-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UmMPaYIqYae3Dzqa4pngQ08bPg0PHRVq2hqkNora9/QwIpOQ7vZxCNBjQoXVaP41 HzvXq/rv4JgerksUX05NTA== /in/edgar/work/0001068800-00-000373/0001068800-00-000373.txt : 20001115 0001068800-00-000373.hdr.sgml : 20001115 ACCESSION NUMBER: 0001068800-00-000373 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PGI INC CENTRAL INDEX KEY: 0000081157 STANDARD INDUSTRIAL CLASSIFICATION: [1531 ] IRS NUMBER: 590867335 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 001-06471 FILM NUMBER: 764476 BUSINESS ADDRESS: STREET 1: 212 SOUTH CENTRAL STREET 2: SUITE 100 CITY: ST LOUIS STATE: MO ZIP: 63105 BUSINESS PHONE: 3145128650 MAIL ADDRESS: STREET 1: 212 SOUTH CENTRAL STREET 2: SUITE 100 CITY: ST LOUIS STATE: MO ZIP: 63105 FORMER COMPANY: FORMER CONFORMED NAME: PUNTA GORDA ISLES INC DATE OF NAME CHANGE: 19900403 10QSB 1 0001.txt PGI INCORPORATED FORM 10-QSB PGI INCORPORATED AND SUBSIDIARIES U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10 - QSB (Mark One) / x / QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000 ---------------------------------- / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------------- ---------------------- Commission File Number 1-6471 ----------------------------------------------- PGI INCORPORATED ---------------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) FLORIDA 59-0867335 ---------------------------- ------------------------------------ (State or other jurisdiction (I.R.S. Employer Identification No.) of incorporation 212 SOUTH CENTRAL, SUITE 100, ST. LOUIS, MISSOURI 63105 ---------------------------------------------------------------------- (Address of principal executive offices) (314) 512-8650 ---------------------------------------------------------------------- (Issuer's telephone number) ---------------------------------------------------------------------- (Former Name, Former Address and Former Fiscal year, if changed since last report) Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the past 12 months (or for shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of November 9, 2000 there were 5,317,758 shares of the Registrant's common stock outstanding. Transitional Small Business Disclosure Format (Check one): Yes No X --------- --------- 1 PGI INCORPORATED AND SUBSIDIARIES Form 10 - QSB For the Quarter Ended September 30, 2000 Table of Contents -----------------
Form 10 - QSB Page No. ------------- PART I Financial Information Item 1 Financial Statements Consolidated Statements of Financial Position September 30, 2000 and December 31, 1999 3 Consolidated Statements of Operations Three and Nine Months Ended September 30, 2000 and 1999 4 Condensed Consolidated Statements of Cash Flows Nine Months Ended September 30, 2000 and 1999 5 Notes to Consolidated Financial Statements for Form 10 - QSB 6 - 10 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 11 - 14 PART II Other Information Item 1 Legal Proceedings 15 Item 2 Changes in Securities 15 Item 3 Defaults Upon Senior Securities 15 Item 4 Submission of Matters to a Vote of Security Holders 15 Item 5 Other Information 15 Item 6 Exhibits and Reports on Form 8 - K 15 SIGNATURES 16
2 PGI INCORPORATED AND SUBSIDIARIES Part I Financial Information Item 1 Financial Statements CONSOLIDATED STATEMENTS OF FINANCIAL POSITION ($ in thousands)
September 30, December 31, 2000 1999 ---- ---- ASSETS Cash and cash equivalents $ 26 $ 28 Restricted cash 911 1,441 Receivables 40 43 Land and improvement inventories 757 763 Other assets 182 166 -------- -------- $ 1,916 $ 2,441 ======== ======== LIABILITIES Accounts payable & accrued expenses $ 177 $ 553 Accrued real estate taxes 736 703 Accrued interest: Debentures 12,624 11,323 Other 1,870 1,772 Credit Agreements - Primary lender 700 700 Notes payable 1,198 1,213 Subordinated debentures payable 9,059 9,059 Convertible debentures payable 1,500 1,500 -------- -------- $ 27,864 $ 26,823 ======== ======== STOCKHOLDERS' EQUITY 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) 2,000 2,000 Common stock, par value $.10 per share; authorized 25,000,000 shares; 5,317,758 shares issued and outstanding 532 532 Paid in capital 13,498 13,498 Accumulated deficit (41,978) (40,412) -------- -------- (25,948) (24,382) -------- -------- $ 1,916 $ 2,441 ======== ======== See accompanying notes to consolidated financial statements for Form 10 - QSB.
3 PGI INCORPORATED AND SUBSIDIARIES Part I Financial Information (Continued) CONSOLIDATED STATEMENTS OF OPERATIONS ($ in thousands) (Unaudited)
Three Months Ended Nine Months Ended ------------------ ----------------- September 30, September 30, September 30, September 30, 2000 1999 2000 1999 ---- ---- ---- ---- REVENUES Real Estate Sales $ 35 $ 27 $ 35 $ 27 Interest Income 12 14 30 45 Other Income 9 1 13 19 ----- ----- ------- ------- 56 42 78 91 ----- ----- ------- ------- COSTS AND EXPENSES Cost of Real Estate Sales $ 21 $ 3 $ 21 $ 3 Interest 503 469 1,475 1,376 Taxes & Assessments 16 35 53 99 Consulting & Accounting 11 12 32 36 Legal & Professional 5 22 22 66 General & Administrative 9 13 41 65 ----- ----- ------- ------- 565 554 1,644 1,645 ----- ----- ------- ------- NET (LOSS) $(509) $(512) $(1,566) $(1,554) ===== ===== ======= ======= NET (LOSS) PER SHARE (*) $(.13) $(.13) $ (.38) $ (.38) ===== ===== ======= ======= * Considers the effect of cumulative preferred dividends in arrears for the three and nine months ended September 30, 2000 and 1999. See accompanying notes to consolidated financial statements for Form 10 - QSB
4 PGI INCORPORATED AND SUBSIDIARIES Part I Financial Information (Continued) CONSOLIDATED STATEMENTS OF CASH FLOWS ($ in thousands) (Unaudited)
Nine Months Ended ----------------- September 30, September 30, 2000 1999 ---- ---- Net cash (used in) operating activities $(362) $(176) ----- ----- Cash flows from investing activities: Proceeds from release of restricted cash 372 300 Proceeds from notes receivables 3 3 ----- ----- Net cash provided by investing activities 375 303 ----- ----- Cash flows from financing activities: Proceeds from borrowings -- 15 Principal payments on debt (15) (300) ----- ----- Net cash (used in) financing activities (15) (285) ----- ----- Net increase (decrease) in cash (2) (158) Cash at beginning of period 28 161 ----- ----- Cash at end of period $ 26 $ 3 ===== ===== See accompanying notes to consolidated financial statements for Form 10 - QSB
5 PGI INCORPORATED AND SUBSIDIARIES Notes to Consolidated Financial Statements (1) Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10 - QSB and therefore do not include all disclosures necessary for fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. The Company's independent accountants included an explanatory paragraph regarding the Company's ability to continue as a going concern in their opinion on the Company's consolidated financial statements for the year ended December 31, 1999. The Company remains in default under the indentures governing its unsecured subordinated and convertible debentures and in default of its primary debt obligations. A significant payment on the primary debt obligation occurred with the sale of the undeveloped land in Citrus County upon closing May 13, 1998. (See Management's Discussion and Analysis of Financial Condition and Results of Operations and Notes 9 and 16 to the Company's consolidated financial statements for the year ended December 31, 1999, as contained in the Company's Annual Report on Form 10 - KSB). All adjustments (consisting of only normal recurring accruals) necessary for fair presentation of financial position, results of operations and cash flows have been made. The results for the three and nine months ended September 30, 2000 are not necessarily indicative of operations to be expected for the fiscal year ending December 31, 2000 or any other interim period. (2) Per Share Data Primary per share amounts are computed by dividing net income (loss), after considering cumulative dividends in arrears on the Company's preferred stock, by the average number of common shares and common stock equivalents outstanding. For this purpose, the Company's cumulative convertible preferred stock and collateralized convertible debentures are not deemed to be common stock equivalents, but outstanding vested stock options are considered as such. However, under the treasury stock method, no vested stock options were assumed to be exercised, and therefore no common stock equivalents existed, for the calculation of primary per share amounts for the nine months ended September 30, 2000 and 1999. The average number of common shares outstanding for the nine months ended September 30, 2000 and 1999 was 5,317,758. Fully diluted per share amounts are computed by dividing net income (loss) by the average number of common shares outstanding, after adjusting both for the estimated effects of the assumed exercise of stock options and the assumed conversion of all cumulative convertible preferred stock and collateralized convertible debentures into shares of common stock. For the nine months ended September 30, 2000 and 1999, no stock options were assumed to be exercised and the effect of the assumed exercise of stock options and the assumed conversion of all cumulative convertible preferred stock and collateralized convertible debentures would have been anti-dilutive. 6 PGI INCORPORATED AND SUBSIDIARIES Notes to Consolidated Financial Statements (continued) The following is a summary of the calculations used in computing basic and diluted income (loss) per share for the three and nine months ended September 30, 2000 and 1999.
Three Months Ended Nine Months Ended ------------------ ----------------- September 30, September 30, September 30, September 30, 2000 1999 2000 1999 ---- ---- ---- ---- Net Income (Loss) $ (509,000) $ (512,000) $(1,566,000) $(1,554,000) Preferred Dividends (160,000) (160,000) (480,000) (480,000) ----------- ----------- ----------- ----------- Income (Loss) Available to Common Shareholders $ (669,000) $ (672,000) $(2,046,000) $(2,034,000) =========== =========== =========== =========== Weighted Amount of Shares Outstanding 5,317,758 5,317,758 5,317,758 5,317,758 Basic and Diluted Loss Per Share $ (.13) $ (.13) $ (.38) $ (.38)
(3) Statement of Cash Flows The Financial Accounting Standards Board issued Statement No. 95, "Statement of Cash Flows", which requires a statement of cash flows as part of a full set of financial statements. For quarterly reporting purposes, the Company has elected to condense the reporting of its net cash flows. Interest paid for the nine months ended September 30, 2000 and 1999 was $77,000 and $97,000 respectively. For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. (4) Restricted Cash Restricted cash includes restricted proceeds held by the primary lender as collateral for debt repayment, an escrow for payment of disputed real estate taxes, and escrowed receipts related to sold contracts receivable. (5) Receivables Net receivables consisted of:
September 30, December 31, 2000 1999 ---- ---- ($ in thousands) Contracts receivable on homesite sales $ 291 $ 376 Less: Allowance for cancellations (291) (376) ------- ------- Net receivables on real estate sales 0 0 Other receivables 40 43 ------- ------- $ 40 $ 43 ======= =======
7 PGI INCORPORATED AND SUBSIDIARIES Notes to Consolidated Financial Statements (continued) (6) Land and Improvements Land and improvement inventories consisted of:
September 30, December 31, 2000 1999 ---- ---- ($ in thousands) Unimproved land $ 613 $ 613 Fully improved land 144 150 ------- ------- $ 757 $ 763 ======= =======
(7) Property and Equipment
September 30, December 31, 2000 1999 ---- ---- ($ in thousands) Furniture, fixtures and other equipment $ 31 $ 31 Less: Accumulated depreciation (31) (31) ------- ------- $ 0 $ 0 ======= =======
(8) Other Assets Other assets consisted of:
September 30, December 31, 2000 1999 ---- ---- ($ in thousands) Deposit with Trustee of 6-1/2% debentures $ 150 $ 144 Other 32 22 ------- ------- $ 182 $ 166 ======= =======
(9) Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consisted of:
September 30, December 31, 2000 1999 ---- ---- ($ in thousands) Accounts payable $ 28 $ 37 Accrued consulting fees 105 308 Accrued audit & professional 20 26 Accrued miscellaneous 3 161 Estimated recourse liability for receivables sold 21 21 ------- ------- $ 177 $ 553 ======= =======
8 PGI INCORPORATED AND SUBSIDIARIES Notes to Consolidated Financial Statements (continued) Accrued Real Estate Taxes consisted of: Current real estate taxes $ 27 $ 35 Delinquent real estate taxes 709 668 ------- ------- $ 736 $ 703 ======= =======
(10) Primary Lender Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable Credit agreements with the Company's primary lender and notes payable consisted of the following:
September 30, December 31, 2000 1999 ---- ---- ($ in thousands) Credit agreements - primary lender: (maturing July 8, 1997, bearing interest at prime plus 5%) $ 700 $ 700 Notes payable - $1,176,000 bearing interest at prime plus 2% 1,198 1,213 ------- ------- Subordinated debentures payable: At 6-1/2% interest; due June 1991 1,034 1,034 At 6% interest; due May 1, 1992 8,025 8,025 ------- ------- $ 9,059 $ 9,059 ------- ------- Collateralized convertible debentures payable: At 14% interest; due July 8, 1997, convertible into shares of common stock 1,500 1,500 ------- ------- at $1.72 per share $12,457 $12,472 ======= =======
(11) Real Estate Sales and Other Income Real Estate Sales and Cost of Sales for the three and nine months ended September 30, 2000 and 1999 were as follows:
Three Months Nine Months Ended Ended ----- ----- September 30, September 30, September 30, September 30, 2000 1999 2000 1999 ---- ----- ---- ---- Homesite Sales $ 35 $ 27 $ 35 $ 27 Cost of Sales 21 3 21 3
9 PGI INCORPORATED AND SUBSIDIARIES Notes to Consolidated Financial Statements (continued) Other income for the nine months ended September 30, 2000 and 1999 was $13,000 and $19,000 respectively. The other income mainly consists of recoveries of contracts receivable which have been fully provided for. (12) Commitments and Contingencies The aggregate outstanding balances of all receivables sold and exchanged with recourse totaled $39,000 and $42,000 at September 30, 2000 and December 31, 1999, respectively. Based on its collection experience with such receivables, the Company maintained allowances at September 30, 2000 and December 31, 1999, classified in accounts payable and accrued expenses, of $21,000 for the recourse provision related to all receivables sold. (13) Income Taxes Effective January 1, 1993 the Company adopted Statement of Financial Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes", which requires a change from the deferred method to the asset and liability method of accounting for income taxes. At December 31, 1999, the Company had an operating loss carryforward of approximately $36,000,000 to reduce future taxable income. These operating losses expire at various dates through 2012. The following summarizes the temporary differences of the Company at December 31, 1999 at the current statutory rate: Deferred tax asset: $ 13,600,000 Net operating loss carryforward 12,000 Adjustments to reduce land to net realizable value 56,000 Expenses capitalized under IRC 263(a) 215,000 ITC carryforward (13,711,000) ------------ Valuation allowance 172,000 Deferred tax liability: Basis difference of land and improvement inventories 172,000 ------------ Net deferred tax asset $ 0 ============
10 PGI INCORPORATED AND SUBSIDIARIES Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations Preliminary Note Readers should understand as they read this report that the Company is not presently pursuing its core business. The reason that the Company is no longer pursuing its core business is set forth with more particularity below. During the fiscal year ended December 31, 1996, the Company's business focus and emphasis changed substantially as it concentrated its sales and marketing efforts almost exclusively on the disposition in bulk of its undeveloped, platted, residential real estate. This change was prompted by its continuing financial difficulties due to the principal and interest owed on its debt and management's conclusion that a bulk sale was the best way to reduce the Company's debt service obligations. On May 13, 1998, the Company sold approximately 4,890 acres of undeveloped real estate located mainly in Citrus County, Florida. Its remaining inventory primarily consists of 370 acres located in Hernando County, Florida. The Company intends to make a decision as to whether it will pursue the development and sale of the commercial property in accordance with its historical core business plans or whether it will attempt to sell such property in bulk. That decision will depend, in part, on whether the Company believes it can generate more revenue by developing and selling individual commercial properties or by selling in bulk. Results of Operations Revenues for the first nine months of 2000 decreased by $13,000 to $78,000 from $91,000 for the comparable 1999 period reflecting less interest income due to lower restricted cash balances. A net loss of $1,566,000 was incurred for the first nine months of 2000 compared to net loss of $1,554,000 for the first nine months of 1999. Expenses for the nine months decreased by $1,000. After consideration of cumulative preferred dividends in arrears, totaling $480,000 for each of the nine months ended September 30, 2000 and 1999 ($.15 per share of common stock), net (loss) per share of $(.13) was reported for both nine month periods ended September 30, 2000 and 1999. Real Estate Sales and Cost of Sales consisted of:
Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2000 1999 2000 1999 ---- ---- ---- ---- Homesite Sales $ 36 $ 27 $ 36 $ 27 Cost of Sales 21 3 21 3
Other income for the nine months ended September 30, 2000 and 1999 was $13,000 and $19,000 respectively. The other income mainly consists of recoveries of contracts receivable which have been fully provided for. 11 PGI INCORPORATED AND SUBSIDIARIES Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) As of September 30, 2000, the Company remained in default of its primary lender indebtedness with PGIP, LLC, ("PGIP"). PGIP holds restricted funds of the Company pursuant to an escrow agreement whereby funds may be disbursed (i) as requested by PGI and agreed to by PGIP, or (ii) as deemed necessary and appropriate by PGIP, in either case, to protect PGIP's interest in the Retained Acreage (as hereinafter defined), including PGIP's right to receive principal and interest under the note agreement securing the remaining indebtedness, or (iii) to PGIP to pay any other obligations owed to PGIP by the Company. The restricted escrow held by the primary lender at September 30, 2000 and December 31, 1999 was $349,000 and $506,000 respectively. The real estate owned by the Company which has not been sold, approximately 370 acres (the "Retained Acreage") remains subject to the primary lender indebtedness. The Company believes that the Retained Acreage in Hernando County, Florida may in the future prove to be of greater value per acre than the 4,890 acres sold in May, 1998 because of a greater ratio of acreage to frontage on the proposed Suncoast Expressway, and because of the close proximity to the planned interchange of the Suncoast Expressway with Highway 98. The Company believes that completion of the highway improvements could reasonably be expected to increase materially the value of the property. In December, 1999, the Hernando County Commission approved a change in land use of 40 acres of the parcel from residential to commercial use. The Company anticipates that completion of the Suncoast Expressway to Highway 98 will occur in the coming year, but will not continue beyond Highway 98 for several years. Any information or projections of enhanced values are purely speculative. Restricted cash of $372,000 was released on February 24, 2000. The restricted fund had been established with the deposit of $250,000 in escrow for twenty years pursuant to a Permit Agreement entered into June 19, 1973. The agreement provided for state certification of water quality standards in conjunction with construction of navigable waterways in Charlotte County, Florida. The escrow fund was extended for five years in 1993 and was going to be extended for another five years in 1998. The Company challenged this extension. A settlement agreement was reached whereby the Company received $212,000 of the escrowed funds and $160,000 was disbursed to the Burnt Store Isles Canal Maintenance Assessment District and the State of Florida Department of Environmental Protection. Contracts receivable on homesite sales and related receivables are fully provided for cancellation at September 30, 2000 and December 31, 1999. The Company has been actively pursuing collection on the delinquent receivables. An assessment is made for each contract receivable as to the economic benefit of reacquisition of the lot considering the cost of foreclosure, delinquent taxes and association fees due, and estimated current sale value of the lot. For those with benefit, foreclosure action is begun in the absence of payment or receipt of a quit claim deed of the property back to the Company. Four lots were reacquired through foreclosure in the nine months ended September 30, 2000. An additional seven lots were reacquired through foreclosure in October, 2000. Cash used in operating activities for the nine months ended September 30, 2000 was $362,000 compared to $176,000 for the comparable 1999 period. With the release of restricted cash in February, 2000, $160,000 was paid in associated settlement fees and the Company paid $150,000 of accrued consulting fees to Love Real Estate Company. Cash used in financing activities in the amount of 12 PGI INCORPORATED AND SUBSIDIARIES Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) $15,000 was for repayment of a note payable to Love Investment Company. Analysis of Financial Condition Assets totaled $1.9 million at September 30, 2000 compared to $2.4 million at December 31, 1999, reflecting the following changes:
September 30, December 31, Increase 2000 1999 (Decrease) ---- ---- ---------- ($ in thousands) Cash and cash equivalents $ 26 $ 28 $ (2) Restricted cash 911 1,441 (530) Receivables 40 43 (3) Land and improvement inventories 757 763 (6) Other assets 182 166 16 ------- ------- ------- $ 1,916 $ 2,441 $ (525) ======= ======= =======
Liabilities were $27.9 million at September 30, 2000 compared to $26.8 million at December 31, 1999 reflecting the following changes among categories:
September 30, December 31, Increase 2000 1999 (Decrease) ---- ---- ---------- ($ in thousands) Accounts payable & accrued expenses $ 177 $ 553 $ (376) Accrued real estate taxes 736 703 33 Accrued interest 14,494 13,095 1,399 Credit agreements - primary lender 700 700 -- Notes 1,198 1,213 (15) Convertible subordinated debentures payable 9,059 9,059 -- Convertible debentures payable 1,500 1,500 -- ------- ------- ------- $27,864 $26,823 $ 1,041 ======= ======= =======
The Company has aggressively taken steps to curtail and simplify operations as well as concentrate on major bulk sales of its undeveloped acreage. The Company remains totally dependent upon the sale of property to fund its operations and debt service requirements. 13 PGI INCORPORATED AND SUBSIDIARIES Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) The Company remains in default of the entire principal plus interest on its subordinated debentures. The amounts due are as indicated in the following table:
September 30, 2000 ------------------ Principal Unpaid Amount Due Interest ---------- -------- ($ in thousands) Subordinated debentures due June 1, 1991 $ 1,034 $ 736 Subordinated debentures due May 1, 1992 8,025 6,512 ------- ------- $ 9,059 $ 7,248 ======= =======
The Company does not have funds available to make any payments of either principal or interest on the above debentures. Year 2000 Issues - ---------------- The year 2000 issue is determined to have had an immaterial effect on the Company. As of January 1, 1999, the Company began maintaining the financial records on different software, which is also used by a related party. The related party was responsible for testing and modifying the software for the year 2000 processing. 14 PGI INCORPORATED AND SUBSIDIARIES PART II Other Information Item 1 Legal Proceedings In 1994, the Citrus County Tax Assessor denied agricultural exemption status for the undeveloped Sugarmill Woods property and the Company was forced to sue the County to reclaim the tax benefit. In 1995, the Citrus County Tax Assessor again denied agricultural exemption status for the undeveloped Sugarmill Woods property, but was overruled by the Value Adjustment Board. As a result, the Tax Assessor sued Sugarmill Woods, and was again successful in denying the agricultural exemption for the property. The Company won on appeal, but the Tax Assessor appealed to the Supreme Court of Florida to reinstate the exemption. On April 1, 1999, the Supreme Court of Florida issued their opinion in favor of Sugarmill Woods, Inc. On November 9, 1999 the Circuit Court of Citrus County adjudged the agricultural classification applicable to tax years 1994, 1995 and 1996. Tax year 1997 remains in dispute on a matter of timely filing of petition for exemption. There is a restricted escrow of $557,000 for payment of the taxes. Item 2 Changes in Securities Not applicable. Item 3 Defaults Upon Senior Securities See discussion in Item 2 with respect to defaults on the Company's subordinated debentures and collateralized convertible debentures, which discussion is incorporated herein by this reference. Item 4 Submission of Matters to a Vote of Security Holders Not applicable. Item 5 Other Information Not applicable. Item 6 Exhibits and Reports on Form 8 - K (a) Exhibits - reference is made to the Exhibit Index contained on page 17 herein for a list of exhibits filed under this Item. (b) No report on Form 8 - K was filed during the quarter ended September 30, 2000. 15 PGI INCORPORATED AND SUBSIDIARIES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. PGI INCORPORATED -------------------------- (Registrant) Date: November 14, 2000 /s/ Laurence A Schiffer ------------------------- ------------------------------- Laurence A. Schiffer President 16 PGI INCORPORATED AND SUBSIDIARIES EXHIBIT INDEX - ------------- 2. Inapplicable. 3. Inapplicable. 4. Inapplicable. 10. Inapplicable. 11. Statements re: Computations of Per Share Earnings. (See Note 2 to the consolidated financial statements.) 15. Inapplicable. 18. Inapplicable. 19. Inapplicable. 22. Inapplicable. 23. Inapplicable. 24. Inapplicable. 27. Financial Data Schedule. 17 EX-27 2 0002.txt FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1999 JUL-01-2000 SEP-30-2000 937,000 0 331,000 (291,000) 757,000 0 31,000 (31,000) 1,916,000 0 12,457,000 532,000 0 2,000,000 (28,480,000) 1,916,000 35,000 21,000 21,000 21,000 41,000 0 503,000 (509,000) 0 0 0 0 0 (509,000) (.13) (.13) CURRENT ASSETS AND CURRENT LIABILITIES VALUES ARE ZERO BECAUSE OF AN UNCLASSIFIED BALANCE SHEET.
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