SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 [FEE REQUIRED]
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
FOR THE TRANSITION PERIOD FROM _______________ TO _______________.
COMMISSION FILE NUMBER 1-8254
THACKERAY CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 04-2446697
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 MADISON AVENUE, SUITE 1508, NEW YORK, NEW YORK 10017
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 759-3695
Securities registered pursuant to Section 12(b) of the Act:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
- ------------------- -------------------
Common Stock, $.10 par value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such 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 .
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy materials or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
Aggregate market value of the voting stock (which consists solely of shares of
Common Stock) held by non-affiliates of the registrant as of March 14, 1996
computed by reference to the closing sale price of the registrant's Common Stock
on the New York Stock Exchange on such date: $11,004,192.
Number of shares of the registrant's Common Stock outstanding as of March 14,
1996: 5,107,401.
[cover page 1 of 2 pages]
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
1. Certain portions of the registrant's Annual Report to Stockholders for
the fiscal year ended December 31, 1995 (the "Annual Report") are
incorporated by reference into Parts I and II of this report.
[cover page 2 of 2 pages]
<PAGE>
PART I
Item 1. Business
GENERAL DEVELOPMENT OF BUSINESS
Thackeray Corporation ("Thackeray" or the "Company") is a
Delaware corporation which holds real estate and mortgage loans secured by real
estate, for investment. On May 19, 1995, the Company sold its Atlantic Hardware
& Supply Corporation ("Atlantic") subsidiary to Colonial Commercial Corp. for
$3,854,000. Except for $450,000 thereof, which was used to repay advances
previously made by Atlantic to the Company, such proceeds were and will be used
for working capital purposes of the Company. Atlantic's primary business was the
distribution of door hardware, doors and frames used in new building
construction, buildings being rehabilitated, interior tenant buildouts, and
building maintenance.
DESCRIPTION OF BUSINESS
Set forth below is a description of the industry segment in which
the Company currently operates.
Thackeray's business is the management of its mortgage loans and
real estate investments. Thackeray does not presently intend to acquire
additional real estate assets and plans to continue to manage its assets and to
sell some or all of its remaining real estate assets in order to realize a
profit on its investments as advantageous opportunities for such sales occur.
Thackeray is subject to competition from various types of enterprises owning or
investing in properties similar to those owned by Thackeray and otherwise
engaging in activities similar to those of Thackeray. Many of these
enterprises have substantially greater financial and personnel resources and
greater experience in construction, development, management and sale of real
estate properties than Thackeray.
For information with respect to the real estate and mortgage
loans, see Notes 1 and 3 of Notes to Consolidated Financial Statements included
in the Annual Report, which Notes are incorporated herein by reference.
In March 1996, the Company entered into a contract for the sale
of its 90.9 acre Dade County, Florida property for $2.5 million, which amount is
in excess of the carrying value of the property. The closing is contingent on
the buyer's
1
<PAGE>
obtaining development approvals for the intended use of the property. If such
approvals are obtained, the contract contemplates a fourth quarter 1996 closing.
In December 1995, the Company entered into a non-binding letter
of intent with a real estate developer regarding a joint venture development
of the Company's property in Orlando, Florida. Negotiations are continuing
concerning the terms of the proposed joint venture. If an agreement is reached,
it would be subject to the execution of definitive agreements and approval of
the Company's stockholders. There can be no assurance as to whether a definitive
agreement will be reached.
2
<PAGE>
Indebtedness
- ------------
For information with respect to the Company's indebtedness, see
Note 4 of Notes to Consolidated Financial Statements included in the Annual
Report, which Note is incorporated herein by reference.
General
- -------
As of December 31, 1995, the Company had two employees.
Item 2. Properties
----------
For additional information with respect to the Company's
investments in real estate and to its lease obligations, see Notes 1, 3 and 7 of
Notes to Consolidated Financial Statements included in the Annual Report, which
Notes are incorporated herein by reference.
Thackeray's executive offices are located at 400 Madison Avenue,
New York, New York. The lease at this location expires in September 1996 and
provides for an annual base rent of $26,000.
Item 3. Legal Proceedings
-----------------
There are no legal proceedings currently pending against the Company or
its subsidiaries.
Item 4. Submission of Matters to a Vote of Stockholders
-----------------------------------------------
During the quarter ended December 31, 1995, no matters were
submitted to a vote of stockholders through the solicitation of proxies or
otherwise.
3
<PAGE>
PART II
Item 5. Market for Registrant's Common Stock and Related Stockholder
------------------------------------------------------------
Matters
-------
Reference is made to the information set forth in the section
entitled "Market for Thackeray's Common Stock and Related Stockholder Matters"
in the Annual Report, which section is incorporated herein by reference.
Item 6. Selected Financial Data
-----------------------
Reference is made to the information set forth in the section
entitled "Selected Financial Data" in the Annual Report, which section is
incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
-----------------------------------------------------------------------
of Operations
-------------
Reference is made to the information set forth in the section
entitled "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the Annual Report, which section is incorporated
herein by reference.
Item 8. Financial Statements and Supplementary Data
-------------------------------------------
Reference is made to the information set forth in the following
sections of the Annual Report, which sections are incorporated herein by
reference:
1. Report of Independent Public Accountants.
2. Consolidated Balance Sheets -- December 31, 1995 and 1994.
3. Consolidated Statements of Operations for the years ended
December 31, 1995, 1994 and 1993.
4. Consolidated Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993.
5. Notes to Consolidated Financial Statements -- December 31,
1995, 1994 and 1993.
4
<PAGE>
Item 9. Change in and Disagreements with Accountants on Accounting and
--------------------------------------------------------------
Financial Disclosure
--------------------
Not Applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant
--------------------------------------------------
DIRECTORS OF THE COMPANY
The following table sets forth certain information with respect
to the members of the Board of Directors of the Company. Except as otherwise
indicated, each director has held his present principal occupation for the past
five years.
<TABLE>
<CAPTION>
NAME, AGE (AT MARCH 1, 1996) AND FIRST BECAME
POSITION HELD WITH THE COMPANY PRINCIPAL OCCUPATION A DIRECTOR
- ------------------------------ -------------------- ----------
<S> <C> <C>
Martin J. Rabinowitz (1).... Limited Partner of Odyssey Partners, L.P. 1985
64 ("Odyssey"), an investment partnership, New York,
Chairman of the Board (since New York (since 1993; previously General Partner);
1986) and President (since Director and Chairman of the Board, Eagle Food
1987) Centers, Inc. (since 1992).
Jules Ross(1)............... Principal of Odyssey (since 1987); Director, 1988
63 Monroc, Inc. (since 1988); President, CER
Vice-President, Finance and Corporation, an engineering consulting firm, Las
Treasurer (since 1990) and Vegas, Nevada (1991-1993).
Secretary (since 1991)
Ronald D. Rothberg(2)....... President, The RDR Group Inc., a private 1983
49 investment company (since 1988); Principal of
Odyssey (1982-1988); Vice President and Secretary
of the Company (1983-1991).
Moses Rothman(2)............ Chairman, Black Inc. A.G., a film distributor, 1988
77 London, England (since 1971).
John Sladkus(1)............. Senior Vice President, Peter Sharp & Co., Inc., a 1981
72 real estate management company, New York, New
York; Executive Vice President of Avatar Holdings
Inc., a land development company, Coral Gables,
Florida (1981-1991).
<FN>
(1) Member of the Company's Executive Committee and Nominating Committee.
(2) Member of the Company's Audit Committee.
</TABLE>
5
<PAGE>
None of the present directors is a director of any company with a
class of securities registered pursuant to Section 12 of the Securities Exchange
Act of 1934 or subject to the requirements of Section 15(d) of that Act or any
company registered as an investment company under the Investment Company Act of
1940, except as indicated above.
There are no executive officers of the Company other than those
named above. Officers are generally elected annually at the first meeting of the
directors of the Company following the Annual Meeting of Stockholders.
No family relationships exist between any director or executive
officer of the Company.
Item 11. Executive Compensation
----------------------
The Company qualifies as a "small business issuer" under the rules of
the Securities and Exchange Commission and, accordingly, the information in this
section is furnished in accordance with the rules applicable to such issuers.
SUMMARY COMPENSATION TABLE
The following table sets forth information with respect to the
compensation of the Chief Executive Officer for services in all capacities to
the Company and its subsidiaries in 1993, 1994 and 1995. No executive officer
had compensation during the fiscal year ended December 31, 1995 in excess of
$100,000.
6
<PAGE>
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
----------------------------- ----------------------------------
AWARDS PAYOUTS
----------------------- ----------
OTHER ALL
NAME AND ANNUAL RESTRICTED OPTIONS OTHER
PRINCIPAL COMPEN- STOCK (# OF LTIP COMPEN-
POSITION YEAR SALARY BONUS SATION(1) AWARD(S) SHARES) PAYOUTS SATION
- ----------- ------ ------- ------- --------- ---------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Martin J. 1995 -0- -0- -0- -0- -0- -0- $1,500(1)
Rabinowitz 1994 -0- -0- -0- -0- -0- -0- 1,500(1)
Chairman, 1993 -0- -0- -0- -0- -0- -0- 1,500(1)
CEO and
President
<FN>
- ----------
(1) Mr. Rabinowitz did not receive any salary or other compensation from the Company, except in
his capacity as director.
</TABLE>
Directors of the Company are paid a fee of $500 for each meeting
attended. In addition, the members of the Company's Audit Committee receive a
fee of $500 for each committee meeting attended. No fee is paid for meetings
held by telephone conference call.
7
<PAGE>
Item 12. Security Ownership of Certain
Beneficial Owners and Management
--------------------------------
The following table contains certain information with respect to each
person known to the Company to have been, at February 29, 1996 (or, as otherwise
set forth below), the beneficial owner of more than 5% of the shares of Common
Stock of the Company ("Shares"). Except as otherwise indicated, all Shares are
owned directly.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME AND ADDRESS OF OF BENEFICIAL PERCENT OF
BENEFICIAL OWNER OWNERSHIP CLASS
- ---------------------------------------------------- ---------------------- --------------
<S> <C> <C>
Odyssey Partners, L.P................................. 1,337,625(1) 26.2%
31 West 52nd Street
New York, New York 10019
Estate of Peter Sharp................................. 981,400(2) 19.2%
c/o Peter Sharp & Co., Inc.
1370 Avenue of the Americas
New York, New York 10019
The Peter Jay Sharp Foundation........................ 341,000 6.7%
c/o Peter Sharp & Co., Inc.
1370 Avenue of the Americas
New York, New York 10019
Dimensional Fund Advisors Inc......................... 312,300(3) 6.1%
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401
<FN>
8
<PAGE>
- ----------------
(1) Of this amount 1,309,500 shares are owned directly by Odyssey and 28,125
shares are owned directly by Ronald D. Rothberg, formerly a principal of
Odyssey and currently a director of the Company. Leon Levy, Jack Nash,
Stephen Berger, Joshua Nash and Brian F. Wruble, by virtue of being
general partners of Odyssey, share voting and dispositive power with
respect to the common stock owned by Odyssey and, accordingly, may be
deemed beneficial owners of the common stock owned by Odyssey. Each of
the aforesaid persons expressly disclaims any such beneficial ownership
(within the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended) which exceeds the proportionate interest in the common
stock which he may be deemed to own as a general partner of Odyssey. The
Company has been advised that no other person exercises (or may be
deemed to exercise) any voting or investment control over the common
stock owned by Odyssey. Odyssey is a private investment firm with
substantial equity capital invested in marketable securities and closely
held businesses.
(2) Of this amount, 937,500 Shares are owned directly by the Estate of Peter
Sharp and 43,900 Shares are owned directly by Peter Sharp & Co., Inc.,
which is wholly-owned by the Estate of Peter Sharp.
(3) Such information is as of December 31, 1995 and is based upon
information furnished to the Company by Dimensional Fund Advisors Inc.
("Dimensional"). Dimensional, a registered investment advisor, is deemed
to have beneficial ownership of 312,300 Shares as of December 31, 1995,
all of which Shares are held in portfolios of DFA Investment Dimensions
Group Inc., a registered open-end investment company, or in series of
the DFA Investment Trust Company, a Delaware business trust, or the DFA
Group Trust and DFA Participating Group Trust, investment vehicles or
qualified employee benefit plans, all of which Dimensional serves as
investment manager. Dimensional disclaims beneficial ownership of all
such Shares.
</TABLE>
The following table sets forth, as of March 20, 1996, the number
of Shares beneficially owned by each director of the Company, each executive
officer named in the Summary Compensation Table above and by all directors and
executive officers of the Company as a group. Except as otherwise indicated, all
Shares are owned directly.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL PERCENT OF
NAME OR GROUP OWNERSHIP CLASS
------------- --------- -----
<S> <C> <C>
Martin J. Rabinowitz(1)............... __ __
Jules Ross............................ __ __
Ronald D. Rothberg.................... 28,125(2) (3)
Moses Rothman......................... 2,000 (3)
John Sladkus.......................... __ __
All directors and officers as a group
(5 persons)......................... 30,125(4) (3)
<FN>
9
<PAGE>
- --------------
(1) Mr. Rabinowitz is a limited partner of Odyssey. Accordingly, he does not
beneficially own shares owned by Odyssey. Does not include 5,650 Shares
owned by Mr. Rabinowitz's wife as to which Shares Mr. Rabinowitz
disclaims beneficial ownership.
(2) All of such Shares are beneficially owned by Odyssey, but directly owned by
Mr. Rothberg.
(3) Less than 1%.
(4) See footnotes above.
</TABLE>
Item 13. Certain Relationships and Related Transactions
----------------------------------------------
Not Applicable.
10
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K
-----------------------
(a)(1) and (2) - The response to this portion of Item 14 is
submitted as a separate section of this report entitled "List of Financial
Statements and Financial Statement Schedules."
(3) - Exhibits:
3(a)(i) - Certificate of Incorporation of the Company. (1)
3(a)(ii) - Certificate of Designation of $4.15 Cumulative
Preferred Stock. (2)
3(a)(iii)- Amendment to Certificate of Incorporation of the
Company.(3)
3(b) - By-Laws of the Company. (1)
10 - Stock Purchase Agreement, dated as of May 19, 1995, by
and among Thackeray Corporation, Brennand-Paige
Industries, Inc., and Colonial Commercial Corp. (4)
11 - Statement re Computation of Per Share Data.
13 - The Company's 1995 Annual Report to Stockholders.
21 - Subsidiaries of the Company.
27 - Financial Data Schedule.
--------------------
(1) Incorporated by reference to the Company's Registration Statement on
Form S-14 (SEC File No. 2-73435).
11
<PAGE>
(2) Incorporated by reference to the Company's Registration Statement on
Form S-11 (SEC File No. 2-84299).
(3) Incorporated by reference to the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1992.
(4) Incorporated by reference to the Company's Current Report on Form 8-K,
dated May 19, 1995.
(b) - During the quarter ended December 31, 1995, the Company did
not file any reports on Form 8-K.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 20, 1996 THACKERAY CORPORATION
(Registrant)
By: /s/ Martin J. Rabinowitz
----------------------------
Name: Martin J. Rabinowitz
Title: President
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
Chairman of the Board,
President and Director
/s/ Martin J. Rabinowitz (Principal Executive Officer)
- ----------------------------- March 20, 1996
Martin J. Rabinowitz
Vice President, Finance,
Treasurer, Secretary and Director
(Principal Financial
/s/ Jules Ross and Accounting Officer)
- ----------------------------- March 20, 1996
Jules Ross
/s/ Ronald D. Rothberg Director
- ----------------------------- March 20, 1996
Ronald D. Rothberg
/s/ Moses Rothman Director
- ----------------------------- March 20, 1996
Moses Rothman
/s/ John Sladkus Director
- ----------------------------- March 20, 1996
John Sladkus
</TABLE>
13
<PAGE>
ANNUAL REPORT ON FORM 10-K
ITEM 14(a)(1) and (2)
LIST OF FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES
YEAR ENDED DECEMBER 31, 1995
THACKERAY CORPORATION
NEW YORK, NEW YORK
14
<PAGE>
Form 10-K -- Items 14(a)(1) and (2)
THACKERAY CORPORATION
LIST OF FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES
The following consolidated financial statements of Thackeray Corporation,
included in the Annual Report to Stockholders for the year ended December 31,
1995, are incorporated by reference in Item 8 of this report.
1. Report of Independent Public Accountants.
2. Consolidated Balance Sheets -- December 31, 1995 and 1994.
3. Consolidated Statements of Operations for the years ended
December 31, 1995, 1994 and 1993.
4. Consolidated Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993.
5. Notes to Consolidated Financial Statements -- December 31,
1995, 1994 and 1993.
The following financial statement schedules of Thackeray Corporation are filed
herewith:
Report of Independent Public Accountants on Financial Statement
Schedules
Schedule II - Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable and therefore have been omitted.
15
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULES
To the Board of Directors and Stockholders of Thackeray Corporation:
We have audited in accordance with generally accepted auditing standards, the
consolidated financial statements included in Thackeray Corporation's 1995
Annual Report to Stockholders incorporated by reference in this Form 10-K, and
have issued our report thereon dated March 20, 1996. Our audit was made for the
purpose of forming an opinion on those statements taken as a whole. The schedule
listed in the List of Financial Statements and Financial Statement Schedules is
the responsibility of the Company's management and is presented for purposes of
complying with the Securities and Exchange Commission's rules and is not part of
the basic consolidated financial statements. This schedule has been subjected to
the auditing procedures applied in the audit of the basic consolidated financial
statements and, in our opinion, fairly states in all material respects the
financial data required to be set forth therein in relation to the basic
consolidated financial statements taken as a whole.
Arthur Andersen LLP
New York, New York
March 20, 1996
16
<PAGE>
<TABLE>
<CAPTION>
THACKERAY CORPORATION AND SUBSIDIARIES SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Allowance for possible investment losses
(Deducted from "Investments in real estate")
Balance at beginning of period $633,000 $197,000 $ 235,000
Charged to costs and expenses 80,000 436,000 -
Other - - (38,000)(a)
-------- -------- ---------
Balance at end of period $713,000 $633,000 $ 197,000
======== ======== =========
<FN>
- --------------------
(a) Represents reclassification of reserves not required as of December 31, 1992.
</TABLE>
17
<PAGE>
EXHIBIT INDEX
TO
THACKERAY CORPORATION
ANNUAL REPORT ON FORM 10-K
FOR FISCAL YEAR ENDED DECEMBER 31, 1995
Sequential
Exhibit No. Description of Document Page No.
- ----------- ----------------------- --------
3(a)(i) -- Certificate of Incorporation of the Company. (1)
3(a)(ii) -- Certificate of Designation of $4.15 Cumulative
Preferred Stock. (2)
3(a)(iii) -- Amendment to Certificate of Incorporation of
the Company. (3)
3(b) -- By-laws of the Company. (1)
10 -- Stock Purchase Agreement, dated as of May 19,
1995, by and among Thackeray Corporation,
Brennand-Paige Industries, Inc.,
and Colonial Commercial Corp. (4)
11 -- Statement re Computation of Per Share Data.*
13 -- The Company's 1995 Annual Report to Stockholders.*
21 -- Subsidiaries of the Company.*
27 -- Financial Data Schedule.*
- ---------------------------
* Filed herewith
(1) Incorporated by reference to the Company's Registration Statement on Form
S-14 (SEC File No. 2-73435).
(2) Incorporated by reference to the Company's Registration Statement on Form
S-11 (SEC File No. 2-84299).
(3) Incorporated by reference to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1992.
(4) Incorporated by reference to the Company's Current Report on Form 8-K,
dated May 19, 1995.
18
EXHIBIT 11
<TABLE>
<CAPTION>
THACKERAY CORPORATION
STATEMENT RE COMPUTATION OF PER SHARE DATA
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
PRIMARY AND FULLY DILUTED
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Weighted average shares outstanding during the year 5,107,401 5,107,401 5,107,401
Net Income (loss) attributable to common stock:
Continuing Operations ($719,000) ($861,000) ($643,000)
Discontinued Operations (1,216,000) 1,031,000 1,201,000
--------- --------- ---------
($1,935,000) $170,000 $558,000
========== ======== ========
Net Income (loss) Per Share
Continuing Operations ($.14) ($.17) ($.13)
Discontinued Operations (.24) .20 .24
--- --- ---
($.38) $.03 $.11
==== ==== ====
</TABLE>
Thackeray Corporation
Annual Report
1995
<PAGE>
Thackeray Corporation
Dear Stockholder:
The net proceeds from the May 1995 sale of Atlantic Hardware & Supply
Corporation have provided the Company with sufficient liquidity for the near
term.
As I mentioned in last year's letter, our principal focus is in
preserving and enhancing the value of our Orlando Property. In that regard, we
recently entered into a non-binding letter of intent with a prominent
developer with respect to the joint development of the property and will keep
you apprised of its progress.
Very truly yours,
/s/ MARTIN J. RABINOWITZ
MARTIN J. RABINOWITZ
Chairman of the Board
March 20, 1996
New York, New York
1
<PAGE>
The Company
Thackeray Corporation ("the Company") is a Delaware corporation which
holds real estate and mortgage loans secured by real estate, for investment.
2
<PAGE>
Selected Financial Data
Five Year Summary
The following tabulation presents selected financial data as restated for
comparability with continuing operations for Thackeray for each of the five
years in the period ended December 31, 1995 (amounts stated in thousands
except for per share data):
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
------- --------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Real estate revenues.................... $ 80 $ 472 $ 99 $ 95 $ 88
(Loss) from continuing operations before
income taxes.......................... (719) (861) (643) (757) (1,299)
Income taxes............................ -- -- -- -- --
Income (loss) from discontinued
operations, net....................... (1,216) 1,031 1,201 138 (2,170)
Net income (loss)....................... (1,935) 170 558 (619) (3,469)
Net income (loss) per share............. (.38) .03 .11 (.12) (.68)
Total assets............................ 10,203 12,506 13,450 13,447 13,936
Mortgage loans and real estate.......... 7,121 7,254 7,869 7,881 7,935
Stockholders' equity.................... 9,754 11,689 11,519 10,961 11,580
</TABLE>
No dividends were declared on Thackeray's common stock during the period
covered by this tabulation. (See Notes 2 and 4 of Notes to Consolidated
Financial Statements for discussion of discontinued operations.)
Quarterly Financial Data (Unaudited)
Financial data for interim periods were as follows (amounts stated in
thousands except for per share data):
<TABLE>
<CAPTION>
March 31 June 30 September 30 December 31
-------- ------- ------------ -----------
<S> <C> <C> <C> <C>
1995
Real estate revenues.................... $ 20 $ 21 $ 20 $ 19
Income (loss) from real estate
operations........................... (43) (60) (59) (190)
Net income (loss)....................... (201) (1,430) (53) (251)
Net income (loss) per share............. (.04) (.28) (.01) (.05)
1994
Real estate revenues.................... $ 24 $ 355 $ 74 $ 19
Income (loss) from real estate
operations........................... (53) 159 2 (499)
Net Income (loss)....................... (28) 115 157 (74)
Net Income (loss) per share............. (.01) .03 .03 (.02)
</TABLE>
3
<PAGE>
Operating Review
Management's Discussion and Analysis of Financial Condition and
Results of Operations
Liquidity and Capital Resources
The Company believes that its current cash balance will be sufficient to
fund its requirements for the foreseeable future.
At December 31, 1995, the Company had no material commitments for capital
expenditures.
Results of Operations
1995 vs. 1994
Total real estate revenues for 1995 were $80,000 versus $472,000 for the
prior year. 1994 included a real estate sale in the amount of $330,000, as
well as other revenues of $50,000, resulting from a forfeited real estate
deposit.
Property carrying costs for 1995 were $25,000 or 7.6% higher than the
amount incurred for 1994. The increase is largely due to an increase in
professional fees relating to the real estate properties.
General and administrative expenses for 1995 were essentially level with
amounts incurred in 1994.
In 1995, the Company increased its allowance for possible losses on real
estate by $80,000, reducing the carrying value of its Sumter County, Florida
acreage to reflect current market conditions.
1994 vs. 1993
Total real estate revenues for 1994 of $472,000 were $373,000 higher than
the prior year. 1994 included the aforementioned real estate sale of $330,000,
and other revenues of $50,000.
Property carrying costs for 1994 were $63,000 or 23.9% higher than the
amount incurred in 1993. The increase is primarily due to higher property
taxes.
General and administrative expenses for 1994 decreased by $29,000 or 6.1%
from amounts incurred in 1993. The decrease was primarily in professional
costs.
In 1994, the Company increased its allowance for possible losses on real
estate by $436,000, reducing the carrying value of its Dade County, Florida
acreage to reflect current market conditions.
Impact of Inflation
The Company acknowledges that the costs of carrying and operating its
real estate may be adversely affected by inflation, however it also expects
that such increased costs would be offset by commensurate increases in market
value.
4
<PAGE>
Report of Independent Public Accountants
To the Board of Directors
and Stockholders of
Thackeray Corporation:
We have audited the accompanying consolidated balance sheets of Thackeray
Corporation (a Delaware corporation) and subsidiaries as of December 31, 1995
and 1994, and the related consolidated statements of operations and cash flows
for each of the three years in the period ended December 31, 1995. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Thackeray Corporation and
subsidiaries as of December 31, 1995 and 1994, and the results of their
operations and their cash flows for each of the three years in the period
ended December 31, 1995, in conformity with generally accepted accounting
principles.
Arthur Andersen LLP
New York, New York
March 20, 1996
5
<PAGE>
Consolidated Balance Sheets
December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995 1994
------------ ------------
<S> <C> <C>
Assets:
Cash and Cash equivalents................................ $ 3,020,000 $ 130,000
Mortgage loans........................................... 62,000 115,000
Investments in real estate (net of allowance of $713,000
in 1995 and $633,000 in 1994)......................... 7,059,000 7,139,000
Other assets............................................. 62,000 118,000
Net assets of discontinued operations.................... -- 5,004,000
------------ ------------
$ 10,203,000 $ 12,506,000
============ ============
Liabilities and Stockholders' Equity:
Accounts payable and accrued expenses.................... $ 83,000 $ 46,000
Accrued income and other taxes........................... 238,000 193,000
Short-term debt.......................................... -- 450,000
Other liabilities........................................ 128,000 128,000
------------ ------------
Total liabilities................................ 449,000 817,000
------------ ------------
Commitments
Stockholders' equity:
Common stock, $.10 par value (20,000,000 shares
authorized; 6,187,401 shares issued)................ 619,000 619,000
Capital in excess of par value........................ 53,424,000 53,424,000
Accumulated deficit................................... (34,299,000) (32,364,000)
Treasury stock (1,080,000 shares)..................... (9,990,000) (9,990,000)
------------ ------------
Total stockholders' equity....................... 9,754,000 11,689,000
------------ ------------
$ 10,203,000 $ 12,506,000
============ ============
<FN>
The accompanying notes are an integral part of these balance sheets.
</TABLE>
6
<PAGE>
Consolidated Statements of Operations
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995 1994 1993
----------- ---------- ----------
<S> <C> <C> <C>
Revenues from real estate operations:
Rental and mortgage income..................... $ 73,000 $ 82,000 $ 97,000
Sales of real estate........................... 7,000 340,000 2,000
Other revenues................................. -- 50,000 --
----------- ---------- ----------
Total real estate revenues............. 80,000 472,000 99,000
----------- ---------- ----------
Expenses of real estate operations:
Property carrying costs including real estate
taxes....................................... 352,000 327,000 264,000
Cost of real estate sales...................... -- 100,000 --
Provision for possible losses on real estate... 80,000 436,000 --
----------- ---------- ----------
Total real estate expenses............. 432,000 863,000 264,000
----------- ---------- ----------
Loss from real estate operations............... (352,000) (391,000) (165,000)
----------- ---------- ----------
General and administrative expenses............ 452,000 447,000 476,000
Interest (income) expense, net................. (85,000) 23,000 2,000
----------- ---------- ----------
Loss from continuing operations before
income taxes................................ (719,000) (861,000) (643,000)
Income Taxes................................... -- -- --
----------- ---------- ----------
Loss from continuing operations................ (719,000) (861,000) (643,000)
Income (loss) of discontinued operations (net of
state income tax expense of $56,000 in 1995,
$175,000 in 1994 and $90,000 in 1993)....... (43,000) 1,031,000 1,201,000
Loss on sale of discontinued operations........ (1,173,000) -- --
----------- ---------- ----------
Net income (loss)...................... $(1,935,000) $ 170,000 $ 558,000
============ ========== ==========
Income (loss) per share from:
Continuing operations.......................... $ (0.14) $ (0.17) $ (0.13)
Discontinued operations........................ (0.24) 0.20 0.24
----------- ---------- ----------
Income (loss) per share........................ $ (0.38) $ 0.03 $ 0.11
============ ========== ==========
Number of shares............................... 5,107,401 5,107,401 5,107,401
============ ========== ==========
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
7
<PAGE>
Consolidated Statements of Cash Flows
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Cash Flows provided by (used in) Operating
Activities:
Net income (loss).............................. $(1,935,000) $ 170,000 $ 558,000
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating
activities:
(Income) loss relating to discontinued
operations............................. 1,216,000 (1,031,000) (1,201,000)
Depreciation and amortization............. 18,000 6,000 8,000
Gain on sale of real estate............... -- (230,000) --
Provision for possible real estate
losses................................. 80,000 436,000 --
Changes in assets and liabilities:
Increase (decrease) in accounts payable
and accrued liabilities................ 4,000 (43,000) (468,000)
Other, net................................ 19,000 16,000 81,000
----------- ----------- -----------
Net cash flows provided by (used in)
operating activities................. (598,000) (676,000) (1,022,000)
----------- ----------- -----------
Cash Flows provided by (used in) Investing
Activities:
Proceeds from sale of subsidiaries............. 3,854,000 -- 250,000
Collections of mortgage loans.................. 53,000 79,000 15,000
Proceeds from sale of real estate.............. -- 330,000 --
Proceeds from sale of other investment......... 38,000 -- --
Additions to property, plant and equipment..... (7,000) -- (6,000)
----------- ----------- -----------
Net cash flows provided by (used in)
investing activities................. 3,938,000 409,000 259,000
----------- ----------- -----------
Cash Flows provided by (used in) Financing
Activities:
Proceeds (repayment) of short-term debt........ (450,000) 200,000 250,000
----------- ----------- -----------
Net cash flows provided by (used in)
financing activities................. (450,000) 200,000 250,000
----------- ----------- -----------
Increase (decrease) in cash and cash
equivalents............................ 2,890,000 (67,000) (513,000)
Cash and Cash equivalents--beginning of
period...................................... 130,000 197,000 710,000
----------- ----------- -----------
Cash and Cash equivalents--end of period....... $ 3,020,000 $ 130,000 $ 197,000
============ ============ ============
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
8
<PAGE>
Notes to Consolidated Financial Statements
December 31, 1995, 1994 and 1993
1. Summary of Significant Accounting Policies
Principles of Consolidation
The consolidated financial statements include the accounts of Thackeray
Corporation ("Thackeray" or the "Company") and its subsidiaries, all of which
are wholly owned. All significant intercompany transactions and balances have
been eliminated.
As a result of the sale of Atlantic Hardware & Supply Corporation
("Atlantic"), as more fully described in Note 2 below, the Company's
operations are now comprised exclusively of managing its real estate
investments and mortgage loans. Accordingly, the Company has elected to
prepare an unclassified balance sheet as of December 31, 1995 for its
continuing operations. In addition, the accompanying statements of operations
for the year then ended reflect the activities of such continuing operations.
The consolidated financial statements for all prior periods have been restated
for purposes of comparability.
Cash and Cash Equivalents
For purposes of the consolidated financial statements, the Company
considers investments in certificates of deposit which will mature in three
months or less, to be cash equivalents.
Mortgage Loans
Mortgage loans are stated at their remaining principal balances less, in
certain cases, a market valuation discount. Such discounts were established at
the time the loans were made to provide a market rate of return to Thackeray.
Real Estate
Substantially all of Thackeray's real estate was acquired through or in
lieu of foreclosure. The carrying value of such real estate acquired prior to
January 1, 1978 includes unpaid principal and any funded interest. Any such
real estate acquired subsequent to December 31, 1977 was, at its acquisition
date, recorded at the lower of cost or fair value.
Real Estate--Allowance for Possible Losses
The allowance for possible losses represents the best estimate by
Thackeray's management of the losses that may ultimately be incurred upon the
disposition of its real estate investments over a period of time in an orderly
manner. This is in accordance with generally accepted accounting principles
which require that losses be anticipated and recorded when they can be
estimated or determined. However, unrealized gains or appreciation may not be
anticipated or recorded until actually realized through consummated
transactions. Accordingly, no consideration or recognition has been given to
any unrealized gains or appreciation which may ultimately be realized upon
disposition of real estate.
Earnings Per Share
Net income (loss) applicable to common stock from continuing operations
and from discontinued operations in each of the years 1995, 1994 and 1993 was
divided by the weighted average number of shares outstanding during the
period.
Reclassifications
Certain reclassifications have been made to prior year information in the
Consolidated Financial Statements to conform with current year presentation.
9
<PAGE>
Accounting Estimates
The preparation of these Consolidated Financial Statements required the
use of certain estimates and assumptions by management in determining the
Company's assets, liabilities, revenues and expenses. Actual results could
differ from those estimates.
2. Sale of Businesses
On May 19, 1995, Brennand Paige Industries, Inc. ("BPI"), a direct
subsidiary of the Company, sold all of the outstanding capital stock of
Atlantic, BPI's wholly owned subsidiary, for $3,854,000 in cash. The Company
and the buyer of Atlantic ("Buyer"), each have investments in two entities,
Monroc Inc. and Sals Investors, L.P. The purchase price was negotiated at arms
length between the respective managements of the Company and the Buyer.
Proceeds from the sale in the amount of $450,000 were used to repay advances
previously made by Atlantic to the Company. The remainder of the proceeds is
being used for working capital purposes of the Company.
The operating results of Atlantic are reflected in the accompanying
consolidated statements of operations for the years ended December 31, 1995,
1994 and 1993 as income (losses) of discontinued operations. Net sales of
Atlantic from January 1, 1995 through May 19, 1995 were $6,509,000, and for
the years ended December 31, 1994 and 1993 were $18,741,000 and $13,508,000,
respectively. Net assets of Atlantic as of May 19, 1995 were $4,949,000.
3. Investments in Real Estate
The various classifications of real estate owned by Thackeray, all of
which is located in Florida, at December 31, 1995 and 1994 were as follows:
<TABLE>
<CAPTION>
1995 1994
---------- ----------
<S> <C> <C>
Partially developed land..................................... $1,585,000 $1,585,000
Undeveloped land............................................. 5,762,000 5,762,000
Land leased to others........................................ 425,000 425,000
---------- ----------
7,772,000 7,772,000
Less:
Allowance for possible losses............................ 713,000 633,000
---------- ----------
$7,059,000 $7,139,000
========== ==========
</TABLE>
The determination of the allowance for possible investment losses gives
effect to several variable factors, including estimates of selling prices and
net costs to be incurred during the assumed holding period. To the extent that
these variable factors change, the allowance may be changed.
In December 1995, the Company entered into a non-binding letter of intent
with a real estate developer regarding a joint venture development of the
Company's property in Orlando, Florida. Negotiations are continuing concerning
the terms of the proposed joint venture. If an agreement is reached, it would
be subject to the execution of definitive agreements and approval of the
Company's stockholders. There can be no assurance as to whether a definitive
agreement will be reached.
4. Debt
In connection with the sale of Atlantic (see Note 2), all outstanding
borrowings of the Company were repaid. For the year 1994, the weighted average
interest rate incurred was 8.7%.
There was no interest paid by continuing operations during the years
ended December 31, 1995, 1994, and 1993.
10
<PAGE>
5. Income Taxes
The Company generated taxable losses from continuing operations for each
of the years ended December 31, 1995, 1994 and 1993. Accordingly no income tax
provisions (credits) have been reported for such years for continuing
operations.
On a consolidated basis for each of the years 1995 and 1993, the Company
reported a taxable loss and, therefore, no Federal income taxes were provided.
The Company reported taxable income for the year ended December 31, 1994.
However, the Company had net operating loss carryforwards well in excess of
the reported taxable income and, therefore, no Federal income taxes are
payable for the year ended December 31, 1994. Accordingly, the 1994 Federal
income tax provision ($60,000) has been eliminated through utilization of such
loss carryforwards in the accompanying Consolidated Statements of Operations
through the reversal of the related valuation reserve (see below).
As of December 31, 1995, Thackeray had net operating loss carryforwards
for Federal income tax purposes of approximately $5,600,000, which can be
carried forward to offset future taxable income. The net operating loss
carryforwards will expire in 1998 ($1,300,000), 2007 ($1,800,000), 2008
($100,000) and 2010 ($2,400,000). Net operating loss carryforwards for book
purposes approximate $5,100,000. In addition, the Company has capital loss
carryforwards of $1,800,000, all of which expire in 2000.
In 1993, the Company adopted the provisions of Statement of Financial
Accounting Standards ("SFAS") No. 109 "Accounting for Income Taxes". No
restatements or adjustments to the consolidated financial statements of the
Company were required as a result of such adoption.
As a result of the adoption of SFAS No. 109, the tax effect of these net
operating loss carryforwards has been recorded as a deferred tax asset.
However, because no substantial amount of these net operating loss
carryforwards are expected to be realized, a valuation reserve equal to such
deferred tax asset has been established.
In 1993, in accordance with the provision of SFAS No. 109, the Company
eliminated its excess liability for income taxes in the amount of $688,000.
Such reduction is reflected as a credit to discontinued operations, as the
excess liability related to formerly owned businesses.
6. Stockholders' Equity
Changes in stockholders' equity for the years ended December 31, 1995,
1994 and 1993 were as follows:
<TABLE>
<CAPTION>
Common Stock Capital Treasury Stock
---------------------- in excess --------------------------
Number of Accumulated Number
of Shares Amount Par Value Deficit of Shares Amount
---------- -------- ----------- ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance December 31, 1992............ 6,187,401 $619,000 $53,424,000 $(33,092,000) (1,080,000) $(9,990,000)
Net income for the year.............. -- -- -- 558,000 -- --
---------- -------- ----------- ------------ ---------- -----------
Balance December 31, 1993............ 6,187,401 619,000 53,424,000 (32,534,000) (1,080,000) (9,990,000)
Net income for the year.............. -- -- -- 170,000 -- --
---------- -------- ----------- ------------ ---------- -----------
Balance December 31, 1994............ 6,187,401 619,000 53,424,000 (32,364,000) (1,080,000) (9,990,000)
Net (loss) for the year.............. -- -- -- (1,935,000) -- --
---------- -------- ----------- ------------ ---------- -----------
Balance December 31, 1995............ 6,187,401 $619,000 $53,424,000 $(34,299,000) 1,080,000 $(9,990,000)
========== ======== =========== ============= ========== ===========
</TABLE>
7. Commitments
Thackeray leases office space under a lease agreement which expires in
1996.
Total rent expense of continuing operations amounted to $30,000 in 1995
and 1994, and $19,000 in 1993.
11
<PAGE>
8. Business Segments
Subsequent to the sale of Atlantic, the remaining operations are
comprised exclusively of real estate and mortgage loan management.
9. Subsequent Event
In March 1996, the Company entered into a contract for the sale of its
90.9 acre Dade County, Florida property for $2.5 million. The closing is
contingent on the buyer's obtaining development approvals for the intended use
of the property. If such approvals are obtained, the contract contemplates a
fourth quarter 1996 closing. Such contract amount is in excess of the carrying
value of the property.
12
<PAGE>
Stockholder Reference
Availability of Form 10-K
Stockholders may obtain a copy of Thackeray's Annual Report on Form 10-K for
the year ended December 31, 1995, without exhibits, free of charge by
writing to the Assistant Secretary,
Thackeray Corporation,
400 Madison Avenue, Suite 1508
New York, New York 10017
Registrar and Transfer Agent
Chemical Bank
450 W. 33rd Street
New York, New York 10001
Independent Public Accountants
Arthur Andersen LLP
New York, New York
General Counsel
Weil, Gotshal & Manges LLP
New York, New York
Market for Thackeray's Common Stock and
Related Stockholder Matters
Thackeray's common stock is traded on the New York Stock Exchange. The
following table sets forth the reported high and low sales prices for
Thackeray's common stock during the periods indicated as reported in the
record of composite transactions for New York Stock Exchange listed
securities.
<TABLE>
<CAPTION>
Quarter Ended
-----------------------------------------------
September December
March 31 June 30 30 31
-------- -------- -------- --------
<S> <C> <C> <C> <C>
1995 High 4 3/4 5 5/8 5 1/4 4 5/8
Low 3 7/8 3 5/8 4 1/2 4 1/4
1994 High 4 3/8 4 3/4 4 1/2 4 5/8
Low 4 4 4 1/8 3 3/4
<FN>
As of the close of business on March 20, 1996, there were approximately
1,444 holders of record of Thackeray's common stock.
During the three years ended December 31, 1995, no dividends were paid on
Thackeray's common stock.
</TABLE>
13
<PAGE>
Directors
Martin J. Rabinowitz(1)
Limited Partner, Odyssey Partners, L.P.
an investment partnership
New York, New York
Jules Ross(1)
Principal, Odyssey Partners, L.P.
Ronald D. Rothberg(2)
President, The RDR Group Inc., a private
investment company
Pomona, New York
Moses Rothman(2)
Chairman, Black Inc. A.G., a film distributor
London, England
John Sladkus(1)
Senior Vice President,
Peter Sharp & Co., Inc.,
a real estate management company
New York, New York
Officers
Martin J. Rabinowitz
Chairman of the Board and President
Jules Ross
Vice President, Finance, Treasurer and Secretary
Executive Office
400 Madison Avenue, Suite 1508
New York, New York 10017
(212) 759-3695
(1) Member of Executive Committee and Nominating Committee
(2) Member of Audit Committee
14
EXHIBIT 21
SUBSIDIARIES OF THACKERAY CORPORATION
NAME OF CORPORATION STATE OF INCORPORATION
- ------------------- ----------------------
Wholly-Owned by Thackeray Corporation
- -------------------------------------
Brennand-Paige Industries, Inc. Delaware
14155 Corp. New York
NYFS07...:\55\69555\0001\1628\FRM2136R.02D
20
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Schedule contains summary financial
information extracted from the financial
statements contained in the body of the
accompanying Form 10-K and is qualified in its
entirety by reference to such financial
statements.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 3,020,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 10,203,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 619,000
<OTHER-SE> 9,135,000
<TOTAL-LIABILITY-AND-EQUITY> 10,203,000
<SALES> 0
<TOTAL-REVENUES> 80,000
<CGS> 0
<TOTAL-COSTS> 432,000
<OTHER-EXPENSES> 452,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (85,000)
<INCOME-PRETAX> (719,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (719,000)
<DISCONTINUED> (1,216,000)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,935,000)
<EPS-PRIMARY> (.38)
<EPS-DILUTED> (.38)
</TABLE>
