UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1999
Commission File Number 1-8893
ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
----------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 59-2501059
- --------------------------------------------------------------------------------
(State of other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
2501 S. Ocean Drive
Hollywood, Florida 33019
--------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (954) 927-3080
--------------
NONE
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by checkmark 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 the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
CLASS Outstanding at March 31, 1999
----- -----------------------------
Limited Partnership Units 4,485,504 units
<PAGE>
INDEX
PART I. Financial Information
Balance sheets -
March 31, 1999 and
September 30, 1998
Statements of operations -
Three months and six months ended
March 31, 1999 and 1998
Statements of cash flows -
Three months and six months ended
March 31, 1999 and 1998
Notes to financial statements
Management's discussion and analysis
of financial condition and results
of operations
Part II. Other information and signatures
<PAGE>
<TABLE>
<CAPTION>
ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
BALANCE SHEETS
March 31, September 30,
1999 1998
---------- ----------
(unaudited)
<S> <C> <C>
ASSETS
Cash $ 301,726 $ 6,553
Mortgage note and other receivables:
Mortgage note receivable, net of
deferred profit of $264,593 1,033,907 --
Other receivables 1,189 439,825
Property held for sale 2,491,131 4,279,599
Other assets 23,968 59,627
---------- ----------
$3,851,921 $4,785,604
========== ==========
LIABILITIES AND PARTNERS' EQUITY
Liabilities:
Mortgage notes payable, bank $ 659,550 $1,321,750
Accounts payable and other
liabilities 655,657 917,795
Deposit on land sales 125,000 --
---------- ----------
1,440,207 2,239,545
Partners' equity:
4,485,504 units authorized and
outstanding 2,411,714 2,546,059
---------- ----------
$3,851,921 $4,785,604
========== ==========
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS ENDED
MARCH 31, 1999 AND 1998
(UNAUDITED)
Three Months Ended Six Months Ended
March 31, March 31,
-------------------------- --------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Land Revenues:
Gross sales of land $ -- $ 601,000 $ 2,766,500 $ 1,085,500
Less profit deferred until
principal collections are
received -- -- 264,593 --
----------- ----------- ----------- -----------
-- 601,000 2,501,907 1,085,500
Interest income 4,232 3,237 5,544 6,119
Other income -- 16,251 11,035 17,906
----------- ----------- ----------- -----------
4,232 620,488 2,518,486 1,109,525
----------- ----------- ----------- -----------
Cost and expenses:
Cost of sales -- 493,415 2,000,225 871,134
Selling, general and
administrative expenses 182,251 186,954 500,688 313,863
Interest 14,817 23,335 38,803 23,335
Depreciation and
property taxes 55,258 60,906 113,115 111,334
----------- ----------- ----------- -----------
Total costs and expenses 252,326 764,610 2,652,831 1,319,666
----------- ----------- ----------- -----------
Net loss $ (248,094) $ (144,122) $ (134,345) $ (210,141)
=========== =========== =========== ===========
Net loss per unit $ (0.06) $ (0.03) $ (0.03) $ (0.05)
=========== =========== =========== ===========
Weighted average number of
units outstanding 4,485,504 4,485,504 4,485,504 4,485,504
=========== =========== =========== ===========
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
THREE MONTHS AND SIX MONTHS ENDED MARCH 31, 1999 AND 1998
(UNAUDITED)
Three Months Ended Six Months Ended
March 31, March 31,
------------------------- --------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Cash flows from operating
activities:
Cash was received from:
Collections on sales
and receivables $ 50,449 $ 635,449 $ 1,593,064 $ 1,162,455
Interest Income 4,232 3,237 5,544 6,119
Sale of utility system 438,572 228,660 438,572 228,660
Other -- 16,251 11,035 17,906
----------- ----------- ----------- -----------
493,253 883,497 2,048,215 1,415,140
----------- ----------- ----------- -----------
Cash was expended for:
Selling, general and
administrative, property
taxes and other expenses 293,983 284,562 810,077 406,957
Interest paid (net of
amounts capitalized) 14,817 23,335 38,803 23,335
Improvements to property
held for sale 105,450 333,466 241,962 804,303
----------- ----------- ----------- -----------
414,250 641,363 1,090,842 1,234,595
----------- ----------- ----------- -----------
Net cash provided by
operating activities 79,003 242,134 957,373 180,545
----------- ----------- ----------- -----------
Cash flow from financing
activities:
Proceeds from mortgage
notes payable, bank -- 279,399 17,800 662,180
Payments on mortgage
payable, bank -- (440,000) (680,000) (800,000)
----------- ----------- ----------- -----------
Net cash (used in)
financing activities -- (160,601) (662,200) (137,820)
----------- ----------- ----------- -----------
Net increase in cash 79,003 81,533 295,173 42,725
Cash, beginning of period 222,723 9,930 6,553 48,738
----------- ----------- ----------- -----------
Cash, end of period $ 301,726 $ 91,463 $ 301,726 $ 91,463
=========== =========== =========== ===========
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
RECONCILIATION OF NET LOSS TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
THREE MONTHS AND SIX MONTHS ENDED MARCH 31, 1999 AND 1998
(UNAUDITED)
Three Months Ended Six Months Ended
March 31, March 31,
-------------------------- --------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net loss $ (248,094) $ (144,122) $ (134,345) $ (210,141)
----------- ----------- ----------- -----------
Adjustments to reconcile
net loss to net cash
provided by (used in)
operating activities:
Depreciation and
amortization 246 531 687 1,062
Change in assets and
liabilities:
Decrease in:
Mortgage notes and
other receivables 263,009 305,615
Property held for sale (18,907) 227,110 1,788,468 160,894
Other assets 17,388 1,457 34,972 22,208
Accounts payable and
accrued liabilities (160,651) (95,525) (262,138) (68,951)
Estimated costs of
development of land
and property sold -- (10,326) -- (30,142)
Increase in:
Deposits on land sales 50,000 -- 125,000 --
Mortgage notes and other
receivables 439,021 -- (595,271) --
----------- ----------- ----------- -----------
Total adjustments 327,097 386,256 1,091,718 390,686
----------- ----------- ----------- -----------
Net cash flow provided by
operating activities $ 79,003 $ 242,134 $ 957,373 $ 180,545
=========== =========== =========== ===========
</TABLE>
See notes to financial statements
<PAGE>
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS AND SIX MONTHS ENDED
MARCH 31, 1999 AND 1998
1. Interim financial statements:
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q and do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included.
Operating results for the three months and six months ended March 31,
1999 are not necessarily indicative of the results that may be expected
for the fiscal year ending September 30, 1999. These statements should
be read in conjunction with the financial statements and notes thereto
included in the Company's Annual Report on Form 10-K for the fiscal
year ended September 30, 1998.
2. Income tax:
The Partnership has elected to continue its Partnership status beyond
December 31, 1997, by agreeing to pay an annual 3.5% Federal tax on its
gross income for Federal income tax purposes (principally revenues less
cost of land sold). The partners are required to include in their
income tax returns their share of the Partnership's taxable income or
loss.
<PAGE>
ROYAL PALM BEACH COLONY, LIMITED PARTNERSHIP
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SIX MONTHS ENDED
MARCH 31, 1999 AND 1998
(UNAUDITED)
Note: An extract from the Partnership's Annual Report filed with the Securities
and Exchange Commission with respect to the fiscal year ended September 30, 1998
(the "Incorporated 1998 10K") containing Items 1 and 2 thereof is annexed to
this report as an Exhibit, is incorporated herein by reference, and is hereafter
referred to as the "Incorporated 1998 10K."
Results of Operations
During the six month periods ended March 31, 1999 and 1998, the
Partnership had net revenues totaling $2,518,486 and $1,109,525 respectively,
and net a net loss of ($134,345). or ($0.03) per unit and ($210,141) or ($0.05
per unit), respectively. However, reflecting the fact that there were no
closings of real estate sales during the quarter ended March 31, 1999, the
Partnership's net loss in such quarter was ($248,094) or ($0.06) per unit,
compared with a net loss of ($144,122) or ($0.03) in the quarter ended March 31,
1998.
During the recent six-month period, revenues derived principally from
two sales aggregating 79 lots from phases 2 and 3 of the Crestwood Tract
development (see item 2 of the Incorporated 1998 10-K). These lot sales
aggregating $2,416,500, of which $1,298,500 is represented by a
non-interest-bearing promissory note due in two installments with a final
payment on September 30, 1999. The Partnership recognized a profit of $597,492
on these transactions, of which $264,593 has been deferred until principal
collections are received. In addition, $350,000 in gross sales was generated
from the cash sale 7.7 acres of multi-family zoned land, as to which a profit of
$168,793 was recognized. The Partnership also received $125,000 in deposits and
closing extension fees.
Since the Partnership's activities consist principally of the sale of
its remaining properties, and the timing of closing dates for such sales is
usually subject to contingencies which often result in changes to such closing
dates, a comparison of sales and income results from corresponding periods in
different years is not considered meaningful.
Cost of Sales
Cost of sales relates to the sales of land as discussed above. This item varies
as a result of dissimilar profit margins and income recognition methods on the
various sales of land and buildings as discussed above.
Selling, Administrative and Other Expenses
Selling, general and administrative expenses were $182,251 in the three months
ended March 31, 1999, compared with $186,954 in the corresponding quarter of
1998 primarily as the result of an increase in brokerage commissions on higher
real estate sales. Depreciation and property taxes have remained relatively
constant over the past two years, although future property taxes are expected to
decline reflecting substantial reductions in real estate inventory.
Liquidity and Capital Resources
Although cash proceeds from collections on sales and receivables totaled
$1,593,064 during the six months ended March 31, 1999, the Partnership expended
cash of $241,962 for improvements to property held for sale and $810,077 for
selling, general and administrative, property taxes and other expenses. After
payment of closing costs, commissions and required reductions in bank debt of
$20,000 per lot, the Partnership realized net cash proceeds of approximately
$650,000 from land sales during the six months ended March 31, 1999. There were
no land sales in the quarter ended March 31, 1999.
Cash increased from $6,553 at September 30, 1998 to $222,723 at December 31,
1998. Cash further increased to $301,726, as of March 31, 1999, due primarily to
a payment to the Partnership of $438,572 in connection with the sale by the
Partnership's corporate predecessor of a utility plant servicing the Village of
Royal Palm Beach. See "Utility Contingent Receivable," in Item 2 the
Incorporated 1998 10-K.See Financial Information and Statements of Cash Flows.
The Company also received $125,000 as consifderation for the extension of
closing dates under previously executed real estate salse contracts.
The Partnership has entered into an Option Agreement, for nominal consideration,
with the Nature Conservancy (on behalf of Palm Beach County) for the sale of a
tract of approximately 483 acres located in Palm Beach County, as described in
"Acreage in the Vicinity of the Village" in the Incorporated 1998 10-K. The
option price, if exercised, would be aproximately $1,385,000, subject to
adjustment if a survey determines that there are fewer than 483 acres in the
tract. The exercise of the option can not be assured, and a number of conditions
must be satisfied by the Partnership prior to such exercise. Accordingly there
can be no assurance that this Option will ultimately result in cash proceeds to
the Partnership.
Affect of Land Sales on Future Cash Flow
The development and marketing status of the Partnership's properties is
described under Item 2 of the Incorporated 1998 10-K. The Partnership's future
revenues will depend solely upon its ability to develop and/or sell its
remaining real estate, and upon receipts from a prior sale of a utility plant.
At March 31, 1999, the Partnership retained and was holding for sale (1) 20
residential lots and commercial property in the "Crestwood tract in the Village,
(2) multi-family zoned land in the Crestwood tract presently zoned for a
remaining total of approximately 359 units, (as to which land zoned for 290 of
such units is under contract) (3) a tract of 4.54 acres in the Village zoned for
approximately 100 multi-family residential units (4) 171 lots in the vicinity of
the Village zoned for single family homes but presently the subject of
litigation as to the availability of building permits , (5) a 470-acre tract in
the vicinity of the Village, and (6) 12 acres in the vicinity of the Village
being jointly developed with an unrelated party - see "Acreage in the Vicinity
of the Village.
Total net cash flow which might become available for distribution is
unpredictable due to uncertain conditions in the South Florida real estate
market in which the Partnership's remaining real estate is located, and
competition from other owners and developers of real estate in the South Florida
market. These conditions will continue to affect the realizable value of the
Partnership's remaining land, including decisions by parties holding options on
the Partnership's land to exercise such options in whole or in part. The rate of
construction in the Village of Royal Palm Beach could also significantly affect
future payments to the Partnership under the contract described under the
caption "Utilities Contingent Receivable" under Item 2 of the Incorporated 1998
10-K. As indicated under such caption, although the amount to be received by the
Partnership in respect of 1998 represents a substantial increase from receipts
in the two preceding years, it is nevertheless considered unlikely that the rate
of new construction or water consumption in such area will be sufficient to
enable the Partnership to receive the full amount of such payments prior to the
expiration of the contingent payment term.
Environmental Matters
There are no environmental contingencies in respect of the Partnership or its
properties. Use of all of the Partnership's properties is subject to compliance
with state and county land use regulations relating to environmental matters,
which the Partnership takes into account in considering the values of its
properties.
Income Taxes
The Partnership, pursuant to the transitional grandfather rules of the Internal
Revenue Code dealing with publicly traded partnerships, reported its income as a
Partnership for taxable years through December 31, 1997. The application of the
grandfather rules terminated for taxable years commencing after December 31,
1997. Under the Taxpayer Relief Act of 1997, a publicly traded partnership that
is currently governed by this provision may elect to continue its Partnership
tax status beyond December 31, 1997 by agreeing to pay an annual 3.5% Federal
Tax on its gross income for federal income tax purposes (principally revenues
less tax cost of land sold). The Partnership has elected to continue its
Partnership status beyond December 31, 1997. Since the Partnership's tax basis
for its real estate assets is significantly higher than its book basis, the
Partnership did not incur any federal tax on gross income for the tax year ended
December 31, 1998 and estimates that future tax year federal taxes will not be
material. See Note 2 to the Financial Statements included with this report.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Partnership is not a party to any significant legal proceedings.
Item 2. Changes in Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other matters
None
Item 6. Exhibits and Reports on Form 8-k
(a) Exhibits -
99 - (a) Option Agreement between Registrant as Seller and
the Nature Conservancy dated March 1, 1999.
99 - (b) Copy of Items 1 and 2 from Annual Report of the
Registrant on Form 10-K for the fiscal year ended
September 30, 1998.
(b) Reports on Form 8-K - None
<PAGE>
SIGNATURES
Pursuant to the requirements 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.
ROYAL PALM BEACH COLONY,
LIMITED PARTNERSHIP
By: Stein Management Partnership, Inc.
Managing General Partner
DATE: May 11, 1999 By:
------------------------
President
OPTION AGREEMENT FOR SALE AND PURCHASE
THIS AGREEMENT is made this 1st day of March 1999 between the Royal Palm Beach
Colony, L.P., a Delaware Limited Partnership, with an address at 2501 South
Ocean Drive, Hollywood, FL 33019, as "Seller" and The Nature Conservancy, a
non-profit District of Columbia corporation, whose address is 222 South
Westmonte Drive, Suite 300, Altamonte Springs, Florida 32714, and its successors
and assigns, as "Purchaser."
1. GRANT OF OPTION. Seller hereby grants to Purchaser and its successors and
assigns the exclusive option to purchase all of Seller's right, title and
interest in and to the real property located in Palm Beach County, Florida,
described in Exhibit "A", together with all improvements, easements and
appurtenances ("Property"), in accordance with the provisions of this Agreement.
This Agreement becomes legally binding upon execution by the parties but
exercise of the option is subject to approval by the Palm Beach County Board of
County Commissioners (the "Board"), whose address is Palm Beach County
Department of Environmental Resources Management, 3323 Belvedere Road, Building
502, West Palm Beach, Florida 33406. If this option is assigned to the Board,
Palm Beach County shall not have any obligations under this Agreement until it
gives written notice of exercise to Seller. If this option is assigned to the
Board, the Board's agents in all matters shall be the Department of
Environmental Resources Management ("ERM") and the County Attorney's Office.
2. OPTION TERMS. The option is One Hundred Dollars ($100) ("Option Payment"),
the receipt and sufficiency of which is hereby acknowledged by Seller. The
option may be exercised during the period beginning with Purchaser's execution
of this Agreement and ending 150 days after execution of this Agreement by
Seller, unless extended by other provisions of this Agreement ("Option
Expiration Date").
3.A. PURCHASE PRICE. The purchase price ("Purchase Price") for the Property is
One Million Three Hundred Eighty Five Thousand and no/100 Dollars $1,385,000.00,
which after reduction by the amount of the Option Payment, will be paid in cash
or certified funds, or, if assigned to the Board, by County check, to Seller at
closing.
3.B. ADJUSTMENT OF PURCHASE PRICE. The Purchase Price is $1,385,000.00. If the
final County approved survey required by paragraph 5 hereof shows that there are
less than 483 acres, then the Purchase Price will be decreased by $3,000.00 for
each acre less than 483 acres.
4.A. ENVIRONMENTAL AUDIT. Seller shall, at his sole cost and expense and at leas
45 days prior to the Option Expiration Date, furnish to Purchaser a Phase I
environmental audit of the Property which meets the standards and requirements
of the Division of State Lands of the Florida Department of Environmental
Protection ("DSL"). It is Seller's responsibility to ensure that the consultants
contact Purchaser regarding these standards and requirements. Seller shall use
the services of competent, professional consultants with expertise in the
environmental auditing process to determine the existence and extent, if any, of
"Hazardous Materials" shall mean any hazardous or toxic substance, material or
waste of any kind or any other substance which is regulated by any Environmental
Law ( as hereinafter defined in paragraph 4.B.). The audit shall be certified to
Purchaser and the date of certification shall be within 45 days before the date
of closing.
<PAGE>
4.B. HAZARDOUS MATERIALS. In the event that the environmental audit provided for
in paragraph 4.A confirms the presence of Hazardous Materials on the Property,
Seller shall, at its sole cost and expense and prior to the exercise of the
option and closing, promptly commerce and diligently pursue any assessment,
clean up and monitoring of the Property into full compliance with any and all
applicable federal, state or local laws, statutes, ordinances, rules,
regulations or other governmental restrictions regulating, relating , or
imposing liability or standards of conduct concerning Hazardous Materials
("Environmental Law"), but shall not be required to spend more than $7,000.00.
If the estimated cost of clean up of Hazardous Materials exceed $13,000.00
either party may elect to terminate this Agreement and neither party shall have
any further obligations under this Agreement.
5. SURVEY. Seller shall no later than 45 days prior to the Option Expiration
Date obtain at its sole cost and expense and deliver to Purchaser a current
boundary survey of the Property prepared by a professional land surveyor
licensed by the State of Florida which meets the standards and requirements of
DSL. It is Seller's responsibility to ensure that the surveyor contacts the
Bureau of Survey and Mapping in DSL regarding these standards and requirements
prior to the commencement of the Survey. The Survey shall be certified to
Purchaser and the title insurer and the date of certification shall be within 90
days before the date of closing, unless this 90 day time period is waived by
Purchaser and by the title insurer for purposes of deleting the standard
exceptions for survey matters and easements or claims of easement not shown by
the public records from the owner's title policy. If the Survey shows any
encroachment on the Property or that improvements intended to be located on the
Property encroach on the land of others. The same shall be treated as a title
defect.
6. TITLE INSURANCE. Seller shall, at its sole cost and expense and at least 30
days prior to the Option Expiration Date, furnish to Purchaser a marketable
title insurance commitment, to be followed by an owner's marketable title
insurance policy (ALTA Form "B") from a title company approved by Purchaser,
insuring marketable title of Purchaser to the Property to the Property in the
amount of the purchase Price. At closing, Seller shall require that the title
insurer delete the standard exceptions of such policy referring to : (a) all
taxes, (b) unrecorded rights or claims of parties in possession, (c) survey
matters, (d) unrecorded easements or claims of easements, and (e) unrecorded
mechanics' liens.
7. DEFECTS IN TITLE. Seller shall, within 90 days after notice form Purchaser,
cure all defects in title. Seller agrees to use diligent effort to correct the
defects in title within the time provided therefor, but shall not be required to
bring any lawsuits. If Seller is unsuccessful in removing the title defects
within said time, Purchaser shall have option to either: (a) accept the title as
it then is with no reduction in the Purchase Price, (b) extend the amount of
time, not to exceed and additional 90 days, that Seller has to cure the defects
in title, or (c) terminate this Agreement, thereupon releasing Purchaser and
Seller form all further obligations under this Agreement.
8. INTEREST CONVEYED. At closing, Seller shall execute and deliver to
Purchaser a statutory warranty deed in accordance with Section 689.02, Florida
Statutes, conveying marketable title to the
<PAGE>
Property in fee simple fee and clear of all liens, reservations, restrictions,
easements, leases, tenancies and other encumbrances accepted, in writing, by
Purchaser.
9. PREPARATION OF CLOSING DOCUMENTS. Upon execution of this Agreement, Seller
shall submit to Purchaser a properly completed and executed beneficial affidavit
and disclosure as required by Sections 286.23, and 380.08(2), Florida Statutes,
attached hereto as Addendum No. 1, and, at Closing Seller shall execute an
environmental affidavit, on the form attached hereto as Addendum No. 2 Seller
shall prepare the deed described in paragraph 8 of this Agreement, Purchaser's
and Seller's closing statements and the title, possession and lien affidavit
certified to Purchaser and title insurer in accordance with Section 627.7842,
Florida Statutes, on forms provided by Purchaser. All prepared documents shall
be submitted to Purchaser for review and approval at least 15 days prior to the
Closing Date.
10. PURCHASER REVIEW FOR CLOSING. Purchaser will approve or reject each item
required to be provided by Seller under this Agreement within 20 days after
receipt of all of the required items. Seller still have 15 days thereafter to
cure and resubmit any rejected item. In the event Seller fails to timely deliver
any item, or Purchaser rejects any item after delivery, Purchaser may in its
reasonable discretion extended the Option Expiration Date or Closing Date, as
applicable.
11. EXPENSES. Seller will pay the documentary revenue stamp tax and all other
taxes or costs associated with the conveyance, including the cost of recording
the deed described in paragraph 8. Of this Agreement and any other recordable
instruments which the title company deems necessary to assure good and
marketable title to the Property.
12. TAXES AND ASSESMENTS. If this option is not assigned to the Board , all
real estate taxes and assessments which are or which may become a lien against
the Property shall be prorated between the parties to the date of closing.
Notwithstanding any provision herein to the contrary , if this option is
assigned to the Board, all real estate taxes and assessments which are or which
may become a lien against the Property shall be satisfied of record by Seller at
closing. If this option is assigned to the Board and the Board acquires fee
title to the Property between January 1 and November 1, Seller shall, in
accordance with Section 196.295, Florida Statutes, place in escrow with the
county tax collector an amount equal to the current taxes prorated to the date
of transfer, based upon the current assessment and mileage rates on the
Property. In the event the Board acquires fee title to the Property on or after
November 1, Seller shall pay to the county tax collector an amount equal to the
taxes to be determined to be legally due and payable by the county tax
collector.
13. CLOSING PLACE AND DATE. The closing shall be on or before 30 days after
Purchaser exercises the option, but in no event sooner than June 1, 1999,
provided, however, that if a defect exists in the title to the Property , title
commitment, Survey, environmental audit, or any other documents required to be
provided or completed and executed by Seller, the closing shall occur on either
the original closing date or within 15 days after receipt of documentation
curing the defects, whichever is later. Notwithstanding anything herein before
to the contrary, Purchaser may, in its sole discretion, extend the closing up to
an additional 60 days. The place of closing shall be at the offices of Seller's
attorney in West Palm Beach, Florida, and the date and time shall be agreed to
by Purchaser and Seller.
<PAGE>
14. RISK OF LOSS AND CONDITION OF REAL PROPERTY. Seller assumes all risk of
loss or damage to the Property prior to the date of closing and warrants that
the Property shall be transferred and conveyed to Purchaser in the same or
essentially the same condition as of the date of Seller's execution of this
Agreement. ordinary wear and tear excepted. However, in the event the condition
of the Property is altered by an act of God or other natural force beyond the
control of Seller, Purchaser may elect, at its sole option, to terminate this
Agreement and neither party shall have any further obligations under this
Agreement. Seller represents and warrants that there are no parties other than
Seller in occupancy or possession of any part of the Property.
15. RIGHT TO ENTER PROPERTY AND POSSESSION. Seller agrees that from the date
this Agreement is executed by Seller, Purchaser and its agents, upon reasonable
notice, shall have the right to enter the Property for all lawful purposes in
connection with this Agreement. With regard to any entry by Purchaser upon the
Property prior to closing, Purchaser shall be responsible for damage or injury
to persons or property resulting form Purchaser's liability to Seller or to any
third party shall be subject to the limitations and conditions specified in
Section 768.28, Florida Statutes, and nothing contained herein shall be
constructed as a waiver of sovereign immunity. Seller represents and warrants
that there are no parties other than Seller in occupancy or possession of any
part if the Property. Seller agrees to clean up an remove all abandoned personal
property, refuse, garbage, junk, rubbish, trash, and debris (collectively
referred to herein as the "garbage") from the Property prior to the closing, but
shall not be required to spend more than $1,000.00. If the cost to clean up the
garbage exceeds $1,000.00, then the Purchaser shall contribute up to $6,000.00
to clean up the garbage. If the cost to clean up the garbage exceeds $7,000.00,
either party may elect to terminate this Agreement and neither party shall have
any further obligations under this Agreement.
16. ACCESS. Seller warrants that there is direct legal and actual access to the
Property over public roads or valid , recorded easements that benefit the
Property
17. DEFAULT. If either party defaults under this Agreement, the non-defaulting
party may waive the default and proceed to closing, or may seek any other remedy
available at law or in equity against the defaulting party. In connection with
any dispute arising out of this Agreement, including without limitation
litigation and appeals, the prevailing party will be entitled to recover
reasonable attorney's fees and costs.
18. BROKERS. Seller and Purchaser warrant that no persons, firms, corporations
or other entities are entitled to a real estate commission or other fees as a
result of this Agreement or subsequent closing, except as accurately disclosed
on the disclosure statement required in paragraph 9. Seller and Purchaser shall
indemnify and hold each other harmless from any and all such claims, whether
disclosed for undisclosed . In the event this Agreement is assigned to the
County, any fees due any other third party for its services to the Board shall
be the sole responsibility of the County and The Nature Conservancy shall remain
liable for the indemnification set forth in this paragraph 18.
19. ASSIGNMENT. This Agreement may be assigned by Purchaser only to Palm Beach
County, without the consent of Seller, in which event Purchaser will provide
written notice of assignment to Seller.
<PAGE>
20. TIME. Time is of essence with respect to all dates or times set forth in
this Agreement.
21. WETLAND DONATION. At Seller's request , the parties acknowledge that Seller
intends to donate the wetlands portion of the Property to Palm Beach County.
However, this acknowledgment does not represent any concurrence in Seller's
claimed fair market value of the wetlands. Seller acknowledges and agrees that
this wetland donation is an item of negotiated consideration unique to this
particular transaction and accordingly, this wetland donation shall no be used
as a precedent in any future real estate negotiations.
22. SEVERABILITY. In the event any of the provisions of this Agreement are
deemed to be unenforceable, the enforceability of the remaining provisions of
this Agreement shall not be affected.
23. SUCCESSORS IN INTEREST. Upon Seller's execution of this Agreement, Seller's
heirs legal representatives, successors and assigns will be bound by it. Upon
Purchaser's approval of this Agreement and Purchaser's exercise of the option,
Purchaser and Purchaser's successors and assigns will be bound by it. The
covenants, warranties, representations and indemnities made by Seller to
Purchaser hereunder shall incur to the benefit of Purchaser's successors and
assigns.
24. ENTIRE AGREEMENT. This Agreement contains the entire agreement between the
parties pertaining to the subject matter contained in it and supercedes all
prior and contemporaneous agreements, representations and understandings of the
parties. No supplement, modification or amendment to this Agreement shall be
binding unless executed in writing by the parties.
25. WAIVER. Failure of Purchaser to insist upon strict performance of any
covenant or condition of this Agreement, or to exercise any right herein
contained, shall not be constructed as a waiver or relinquishment for the future
of any such covenant, condition or right; but the same shall remain in full
force and effect.
26. AGREEMENT EFFECTIVE. This Agreement or any modification, amendment or
alteration thereto, shall not be effective or binding upon any of the parties
hereto until it ahs been executed by all of the parties.
27. ADDENDUM. Any addendum attached hereto that is signed by the parties shall
be deemed a part of this Agreement.
28. NOTICE. Whenever either party desires or is required to give notice unto
the other, it must be given by written notice, and either delivered personally
or mailed to the appropriate address indicated on the first page of this
Agreement, or such other address as is designated on writing by a party to this
Agreement.
<PAGE>
THE EXERCISE OF THIS OPTION IS SUBJECT TO: (1) CONFIRMATION THAT THE FINAL
ADJUSTED PURCHASE PRICE IS NOT IN EXCESS OF THE COUNTY APPROVED VALUE OF THE
PROPERTY , AND (2) COUNTY APPROVAL OF ALL DOCUMENTS TO BE FURNISHED HEREUNDER BY
SELLER.
SELLER
ROYAL PALM BEACH COLONY, L.P.
a Delaware Limited Partnership
By: Stein Management Co., Inc. a Florida
Corporation, its sole general partner
By: /s/ Randy Reiger
----------------------------------------
Randy Reiger, Authorized Agent
59-2501-059
----------------------------------------
F.E.I.D. No.
3-1-99
----------------------------------------
Date signed by Seller
Executed by the SELLER on 3-1-99
--------------
<PAGE>
/s/ Jim Hr PURCHASER
Jim Hr THE NATURE CONSERVANCY
- -----------------------
Witness as to Purchaser By: /s/ Robert L. Bendick, Jr.
----------------------------------------
/s/ Jane Berger Robert L. Bendick, Jr.
Jane Berger
- ---------------------- Its: Vice President
Witness as to Puchaser
Robert L. Bendick, Jr.
(Corporate Seal)
53-0242652
----------------------------------------
F.E.I.D. No.
3/18/99
----------------------------------------
Date signed by Purchaser
<PAGE>
ADDNDUM No. 1
BENEFICIAL INTEREST AND DISCLOSURE
OTHER
STATE OF ) FLORIDA
)
COUNTY OF ) DADE
Before me, the undersigned authority, personally appeared Randy Rieger,
Authorized Agent. This 1st day of March, 1998 who, first being duly sworn,
deposes and says:
1) That Royal Palm Beach Colony a Delaware Limited Partnership, whose
address is 2501 South Ocean Drive, Hollywood, FL 33019, is the record owner of
the Property. The following is a list of every "person" (as defined in Section
1.03 (3), Florida Statutes) holding 5% or more of the beneficial interest in the
Property.
(if more space is needed, attach separate sheet)
Name Address Interest
- ---- ------- --------
Royal Palm Beach Colony, a Delaware Limited Partnership, is registered with the
Federal Securities Exchange Commission and is exempt from the requirements of s.
286.23 pursuant to ss. 286.23 (3) (a), Florida Statutes.
<PAGE>
2) That to the best of the affiant's knowledge, all persons who have a
financial interest in this real estate transaction or who have received or who
will receive real estate commission, attorney's or consultant's fees or any
other benefits incident to the sale of the property are:
Name Address Reason for Payment Amount
- ---- ------- ------------------ ------
Moyle Flanigan 625 N. Flagler Drive Attorney Fees. Amount to
West Palm Beach, FL 33401 be determined.
RTL Realty, Inc. 1541 Sunset Drive Real Estate Commission
Coral Gables, FL 33143
EnviroDesign Associates, 298 Pineapple Grove Way Phase I Environmental site
Inc. Delray Beach, FL 33444 assessment
3) That, to the best of the affiant's knowledge, the following is a true
history of all financial transactions (including any mortgages and amendments or
modifications thereto, or existing options or purchase agreements in favor of
affront) concerning the Property which have taken place or will take place
during the last five years prior to the conveyance of title to Palm Beach
County, Florida:
Name and Address Type of Amount of
of Parties Involved Date Transaction Transaction
- ------------------- ---- ----------- -----------
NONE
This affidavit is given with the provisions of Sections 286.23 , and 380.08 (2),
Florida
Statutes.
AND FURTHER AFFIANT SAYETH NOT.
/s/ Randy Rieger
------------------------------
Randy Rieger, Authorized Agent
<PAGE>
SWORN TO and subscribed before me this 1st day of March 1999, by Authorized
Agent who is personally known to me or who has produced & drivers license as
identification and who did take an oath.
/s/ Rebecca Santamaria
---------------------------------
Rebecca Santmaria
Notary Public
Rebecca Sanamaria
---------------------------------
(Printed or Typed Name of Notary)
Commission No.: CC 799693
-----------------
My Commission Expires: 12/28/02
-----------
<PAGE>
EXHIBIT "A"
TO
FISRT AMENDMENT TO
OPTION AGREEMENT FOR SALE AND PURCHASE
LEGAL DESCRIPTION
That portion of Sections 19 and 20, Township 41 South, Range 41 East, Palm Beach
County, Florida, lying south of the Seaboard A.L. Railroad.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> MAR-31-1999
<CASH> 301,726
<SECURITIES> 0
<RECEIVABLES> 1,035,096
<ALLOWANCES> 0
<INVENTORY> 2,491,131
<CURRENT-ASSETS> 23,294
<PP&E> 21,843
<DEPRECIATION> 21,169
<TOTAL-ASSETS> 3,851,921
<CURRENT-LIABILITIES> 780,657
<BONDS> 659,550
0
0
<COMMON> 0
<OTHER-SE> 2,411,714
<TOTAL-LIABILITY-AND-EQUITY> 3,851,921
<SALES> 2,501,907
<TOTAL-REVENUES> 2,518,486
<CGS> 2,000,225
<TOTAL-COSTS> 2,000,225
<OTHER-EXPENSES> 613,803
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 38,803
<INCOME-PRETAX> (134,345)
<INCOME-TAX> 0
<INCOME-CONTINUING> (134,345)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (134,345)
<EPS-BASIC> (.03)
<EPS-DILUTED> 0
</TABLE>
