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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
(Mark one)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal period ended December 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
--------- ---------
COMMISSION FILE NUMBER: No 1934 act file number assigned
(1933 act file no. 2-65481)
SADDLEBROOK RESORTS, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 59-1917822
------------------------ ---------------------------------
(State of incorporation) (IRS employer identification no.)
5700 Saddlebrook Way, Wesley Chapel, Florida 33543-4499
-------------------------------------------------------
(Address of principal executive offices)
813-973-1111
----------------------------------------------------
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: None*
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 [ ]
State the aggregate value of voting stock held by nonaffiliates of the
registrant: None*
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of the latest practicable date: Not applicable*
DOCUMENTS INCORPORATED BY REFERENCE
-----------------------------------
Portions of the registrant's Form S-1 Registration Statement (no. 2-65481) as
declared effective December 28, 1979 are incorporated by reference into Part
IV.
* Registrant has no common stock subject to this annual report.
Exhibit index on Page 28
Page 1 of 27
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PART I
Item 1. Business
Saddlebrook Resorts, Inc., (the "Registrant") was incorporated in the State of
Florida on June 20, 1979 as a wholly-owned subsidiary of Pittway Real Estate,
Inc. ("PREI"). PREI was a wholly-owned subsidiary of Penton Publishing, Inc.
which, in turn, was a wholly-owned subsidiary of Pittway Corporation of
Northbrook, Illinois. The Registrant was formed to acquire an existing golf
course and tennis club and develop it into a condominium resort and residential
homes project.
Thomas L. Dempsey ("Dempsey") effectively purchased one hundred percent (100%)
of the authorized and issued stock of the Registrant from PREI in November
1988. Dempsey is the former Chairman of the Board of Penton Publishing, Inc.
and a former Director and Vice President of Pittway Corporation. Dempsey
subsequently gifted 13,000 shares of the Registrant's non-voting stock to
family trusts (see Item 12. Security Ownership of Certain Beneficial Owners and
Management of this Form 10-K, which is incorporated herein by reference).
Prior to November 1988, the Registrant operated and reported the results of its
operations in two industry segments: (1) the real estate segment was engaged in
the development, construction and sales of resort and residential condominium
units, homes and residential lots and (2) the resort segment was engaged in the
ownership and operation of the resort including its facilities for hotel,
convention, food and beverage, golf, tennis and other recreational activities.
In connection with and immediately prior to the sale of the stock of the
Registrant to Dempsey, the Registrant deeded the property which comprised its
real estate segment to PREI as a dividend from a subsidiary to its parent. The
property that was conveyed to PREI was not used as part of the resort or by its
rental guests or condominium owners.
In June 1998, each share of the Registrant's outstanding capital stock was
exchanged for one share of Saddlebrook Holdings, Inc. ("SHI") stock. After the
exchange, Dempsey and the family trusts own 100% of SHI which owns 100% of the
Registrant.
The operations of the Registrant are not considered to be dependent upon the
availability of raw materials, nor the effect of the duration of patents,
licenses, franchises or concessions held.
The Registrant's resort operations are seasonal with a higher volume of sales
during the winter and spring seasons.
The Registrant's competition includes major golf and tennis resorts nationwide,
which provide luxury accommodations and facilities for conventions and
recreational activities.
At December 31, 2000, there were approximately 830 persons employed by the
Registrant. Management's relationship with employees is excellent and there are
no collective bargaining agreements.
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Item 2. Properties
Saddlebrook Resort is located in south Pasco County, near Tampa, Florida. The
property originally consisted of approximately 330 acres which the Registrant
purchased in July 1979. In addition, approximately 170 and 11 adjoining acres
were purchased and added to the Saddlebrook project in 1984 and 1985,
respectively. The Registrant's property has been approved for 950 residential
and condominium units.
A portion of the Registrant's property that was being developed as residential
single family and cluster homes and improved residential lots known as Fairway
Village was deeded to PREI in November 1988 (see Item 1. Business of this Form
10-K, which is incorporated herein by reference).
Property improvements for the resort consist of condominium units which were
sold or are for sale to outside parties of which there were 546 rental units
participating in a rental pooling program at December 31, 2000 (see Exhibit 28
- - Interest Being Registered of this Form 10-K, which is incorporated herein by
reference).
Certain condominium units and their contents, tennis courts and tracts of real
property held for development which were owned by the Registrant are no longer
encumbered by the Registrant's debt (see Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations of this Form 10-K,
which is incorporated herein by reference). Accordingly, concurrent with the
1998 refinancing of its prior debt, the Registrant effectively distributed the
unencumbered property to SHI at its aggregate book value of approximately
$2,515,000.
In addition to condominium units, resort facilities owned by the Registrant and
its affiliates include a 135,000 square foot convention facility with
approximately 78,000 square feet of meeting space, two 18-hole golf courses, 45
tennis courts, a luxury health spa, a fitness center, three swimming pools,
three restaurants, shops and other facilities necessary for the operation of a
resort.
Item 3. Legal Proceedings
The Registrant is involved in litigation in the ordinary course of business. In
the opinion of management, these matters are adequately covered by insurance or
indemnification from other third parties. The effect, if any, of these claims
is, in management's opinion, immaterial to the Registrant's financial condition
and results of operations.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
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PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
The Registrant's stock is privately held and there is no established market for
the stock (see Item 12. Security Ownership of Certain Beneficial Owners and
Management of this Form 10-K, which is incorporated herein by reference).
Condominium units that were developed and sold by the Registrant are deemed to
be securities due to the rental pool feature (see Exhibit 28 - Interest Being
Registered of this Form 10-K, which is incorporated herein by reference).
However, there is no market for such securities other than the normal real
estate market. Since the security is real estate, no dividends have been paid
or will be paid.
Item 6. Selected Financial Data
Year ended December 31,
-----------------------------------------------------------------------
2000 1999 1998 1997 1996
----------- ----------- ----------- ----------- -----------
Operating revenues $50,391,000 $47,306,000 $48,395,000 $41,753,000 $37,309,000
Net income before
taxes 4,203,000 2,336,000 5,675,000 3,133,000 1,740,000
Total assets 40,940,000 37,773,000 40,956,000 32,707,000 29,519,000
Notes payable 23,530,000 24,628,000 25,530,000 18,687,000 19,567,000
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources
The Registrant obtained financing from a third-party lender in June 1998, which
replaced its prior debt. The financing has a fixed annual interest rate of
7.7%, monthly principal and interest payments of approximately $244,000 and
matures on June 30, 2013. The Registrant may obtain additional financing from
the same lender of $5,000,000 provided certain financial covenants are met (see
Note 7 Notes Payable of the Notes to Financial Statements in Item 8 of this
Form 10-K, which is incorporated herein by reference).
Construction of Saddlebrook Resort was substantially complete as of December
1982. During the fiscal period ended December 31, 1999, the Registrant
commenced construction on a new facility which expands its group function space
by 18,000 square feet. This structure, named the Grand Pavilion, was completed
in the spring of 2000 at a cost of approximately $2,060,000. During the fiscal
period ended December 31, 1998, the Registrant completed several capital
projects for an aggregate cost of approximately $2,187,000. However, no
individual project had a cost in excess of $1,000,000. There were no other
major capital additions or improvements during the fiscal years ended December
31, 2000, 1999 and 1998.
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Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations (continued)
Significant capital expenditures are not anticipated in the next year. Future
operating costs and planned expenditures for minor capital additions and
improvements will be funded by the resort operations of the Registrant or by
additional funds provided by the refinancing of the Registrant's debt discussed
above.
Management is not aware of any environmental matters that are currently
present.
The Registrant's operations are not considered to be dependent on any
individual or small group of customers, the loss of whom would have a material
adverse effect.
There are no adverse purchase or other commitments outstanding as of December
31, 2000.
Results of Operations
Revenues for the fiscal years ended December 31, 2000, 1999 and 1998 were
comprised of the following areas of operation:
Year ended December 31,
--------------------------
2000 1999 1998
---- ---- ----
Hotel revenues 49% 49% 48%
Merchandise sales 37 37 37
Club fees 13 13 13
Other income 1 1 2
--- --- ---
100% 100% 100%
=== === ===
Total revenues increased $3,085,000 or 7% for the fiscal year ended December
31, 2000 when compared with the previous year. This improvement was the result
of increases in occupied unit nights and the average daily rate at the resort
for the current year when compared to the prior year. Total revenues decreased
$1,089,000 or 2% for the fiscal year ended December 31, 1999 when compared with
its previous year. This decrease resulted from slightly fewer occupied unit
nights in the resort, partially offset by a higher average daily room rate, for
that fiscal period when compared to its prior period. Projections for occupied
unit nights and revenues for the year 2001 and subsequent fiscal periods are
expected to remain at the resort's current volume of business.
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Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations (continued)
Net income increased $1,867,000 or 80% for the fiscal year ended December 31,
2000 when compared with the previous year. This improvement was a direct result
of the increased revenues which were offset by expected increases in general
costs of operation. The net income for the fiscal year ended December 31, 1999
decreased $3,339,000 or 59% when compared with its previous year. This decrease
is a result of lower revenues and expected increases in general costs of
operation.
The Registrant previously elected S Corporation status and is currently a
member of a Qualified Subchapter S Subsidiary Group. Accordingly, the
Registrant has had no income tax expense since the initial election as the tax
is assessed at the shareholder level (see Note 2 Significant Accounting
Policies of the Notes to Financial Statements in Item 8 of this Form 10-K,
which is incorporated herein by reference).
In management's estimation, the effects of inflation and changing prices on the
Registrant's results of operations were negligible in 2000, 1999 and 1998.
Saddlebrook Rental Pool Operation
The Saddlebrook Rental Pool Operation (the "Rental Pool") is described in Note
2 Significant Accounting Policies of the Notes to Financial Statements of
Saddlebrook Resorts, Inc. and in Note 1 Rental Pool Operations and Rental Pool
Agreement of the Notes to Financial Statements of Saddlebrook Rental Pool
Operation in Item 8 of this Form 10-K, which are incorporated herein by
reference.
The average occupancies for the Rental Pool for fiscal 2000, 1999 and 1998 were
53%, 52% and 57%, respectively. The average distributions of Net Rental Income
per participating rental unit for fiscal 2000, 1999 and 1998 were $12,122,
$11,394 and $12,106, respectively.
Item 8. Financial Statements and Supplementary Data
The financial statements, including the Reports of Independent Certified Public
Accountants, for Saddlebrook Resorts, Inc. are included on pages 11 to 21 and
for Saddlebrook Rental Pool Operation on pages 22 to 26. An index to the
financial statements is on page 10.
Financial statement schedules have been omitted because they are not applicable
or the required information is shown in the financial statements or notes
thereto.
Item 9. Changes in and Disagreements on Accounting and Financial Disclosure
Not applicable.
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PART III
Item 10. Directors and Executive Officers of the Registrant
The Directors and Executive Officers of the Registrant are as follows:
Name Position Background
Thomas L. Dempsey Chairman of the Board, Chairman of the Board, Penton
Age 74 and Chief Executive Publishing, Inc., Cleveland, OH,
29822 Fairway Dr. Officer Vice President and Director,
Wesley Chapel, FL Pittway Corp., Northbrook, IL
Eleanor Dempsey Vice Chairman of the Wife of Thomas Dempsey
29822 Fairway Dr. Board
Wesley Chapel, FL
Richard Boehning Director and President General Manager, Doral Hotel
Age 66 and Country Club, Miami, FL
5017 Pinelake Rd.
Wesley Chapel, FL
Gregory R. Riehle Director, Vice President Son-in-law of Thomas Dempsey,
Age 44 and Secretary Attorney, Shumaker, Loop &
30338 Laurelwood Ln. Kendrick, Tampa, FL
Wesley Chapel, FL
Maureen Dempsey Director, Vice President Daughter of Thomas Dempsey,
Age 42 and Assistant Secretary President, Saddlebrook
29812 Fairway Dr. International Tennis, Inc.
Wesley Chapel, FL
Diane L. Riehle Director, Vice President Daughter of Thomas Dempsey,
Age 40 and Assistant Secretary Regional Sales Manager,
30338 Laurelwood Ln. Saddlebrook Resorts, Inc.
Wesley Chapel, FL
Donald L. Allen Vice President and Controller, Kiawah Island,
Age 61 Treasurer Charleston, SC
1314 Foxwood Dr.
Lutz, FL
Robert A. Shaw Assistant Treasurer and Controller, Gulf Shores
Age 44 Corporate Controller Plantation, Gulf Shores, AL,
5404 Saddlebrook Way CPA, Price Waterhouse,
Wesley Chapel, FL Indianapolis, IN
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Item 11. Executive Compensation
The directors and executive officers of the Registrant as of December 31, 2000
are listed in Item 10 of this Form 10-K, which is incorporated herein by
reference. The aggregate remuneration from the Registrant for all directors and
executive officers for the fiscal year ended December 31, 2000 was $1,500,000.
Of this amount, the Registrant's compensation to Thomas Dempsey was $224,000,
Eleanor Dempsey was $190,000, Richard Boehning was $368,000, Gregory Riehle was
$103,000, Maureen Dempsey was $227,000 and Diane Riehle was $228,000. No other
director or executive officer received compensation in excess of $100,000.
Directors and executive staff are allowed to use the Registrant's resort
facilities and are provided various discounts on related purchases in
accordance with hospitality industry standards. The Registrant had no other
compensation plans for directors and executive officers at December 31, 2000.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Title of Name of beneficial Amount and nature of Percent
class owner beneficial ownership of class
Common Saddlebrook Holdings, Inc. 100.0% 100%
Common Thomas L. Dempsey 100.0% 0%
Common Maureen Dempsey Trust 6.5% 0%
Common Diane Lynn Riehle Trust 6.5% 0%
In December 1994, the Registrant's Articles of Incorporation were amended to
increase the number of shares of authorized common stock from 25,000 to 100,000
shares. Each of the 500 shares of stock that was previously outstanding was
then exchanged for 100 shares of voting stock and 100 shares of nonvoting
stock. The par value of each share remains unchanged at $1. On October 1, 1995,
6,500 shares of nonvoting stock was gifted by Thomas L. Dempsey to each of two
family trusts.
In June 1998, each share of the Registrant's outstanding capital stock was
exchanged for one share of Saddlebrook Holdings, Inc. ("SHI") stock. After the
exchange, Thomas L. Dempsey and the family trusts own 100% of SHI which owns
100% of the Registrant.
Item 13. Certain Relationships and Related Transactions
As of December 31, 2000, present and past executive officers and/or directors
of the Registrant have personally accounted for real estate sales totaling
$2,748,000 since inception of the project. Other relationships and related
transactions are described in Note 9 Related Party Transactions of the Notes to
Financial Statements in Item 8 of this Form 10-K, which is incorporated herein
by reference.
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PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) Financial statements and schedules required to be filed are listed in
Item 8 of this Form 10-K, which is incorporated herein by reference.
Exhibits required to be attached by Item 601 of Regulation S-K are listed
in the Index to Exhibits attached to this Form 10-K, which is incorporated
herein by reference.
(b) The Registrant was not required to file a Form 8-K during the year ended
December 31, 2000.
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.
SADDLEBROOK RESORTS, INC.
(Registrant)
Date: March 31, 2001 /s/ Donald L. Allen
-----------------------
Donald L. Allen
Vice President and Treasurer
(Principal Financial and
Accounting Officer)
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 indicated on March 31, 2001.
/s/ Thomas L. Dempsey /s/ Richard Boehning
----------------------- ----------------------
Thomas L. Dempsey Richard Boehning
Chairman of the Board Director and President
(Principal Executive Officer)
/s/ Gregory R. Riehle /s/ Robert A. Shaw
----------------------- ----------------------
Gregory R. Riehle Robert A. Shaw
Director and Vice President Assistant Treasurer
and Corporate Controller
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SADDLEBROOK RESORTS, INC.
INDEX TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
PAGE(S)
Financial Statements
SADDLEBROOK RESORTS, INC.
Report of Independent Certified Public Accountants 11
Balance Sheets at December 31, 2000 and 1999 12
Statements of Income for each of the three years in the period
ended December 31, 2000 13
Statements of Changes in Shareholder's Equity for each of the
three years in the period ended December 31, 2000 14
Statements of Cash Flows for each of the three years in the
period ended December 31, 2000 15
Notes to Financial Statements 16-21
SADDLEBROOK RENTAL POOL OPERATION
Report of Independent Certified Public Accountants 22
Balance Sheets at December 31, 2000 and 1999 23
Statements of Operations for each of the three years in the
period ended December 31, 2000 24
Statements of Changes in Participants' Fund Balance for each
of the three years in the period ended December 31, 2000 25
Notes to Financial Statements 26
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REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholder of
Saddlebrook Resorts, Inc.
In our opinion, the accompanying balance sheets and the related statements of
income, changes in shareholder's equity and of cash flows present fairly, in
all material respects, the financial position of Saddlebrook Resorts, Inc. at
December 31, 2000 and 1999, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2000 in
conformity with accounting principles generally accepted in the United States
of America. 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 of these statements in
accordance with auditing standards generally accepted in the United States of
America, which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Tampa, Florida
March 9, 2001
11
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SADDLEBROOK RESORTS, INC.
BALANCE SHEETS
- ----------------------------------------------------------------------------------
DECEMBER 31,
--------------------------
2000 1999
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $ 8,109,135 $ 5,551,280
Escrowed cash 298,912 372,104
Short-term investments 345,300 --
Short-term escrowed investments 96,979 195,251
Trade accounts receivable, net of allowances for
doubtful accounts of $65,000 and $164,000 3,718,729 2,874,562
Due from related parties 159,406 531,179
Resort inventory and supplies 1,977,469 1,832,538
Prepaid expenses and other assets 405,179 550,830
----------- -----------
Total current assets 15,111,109 11,907,744
Long-term escrowed investments 495,499 398,553
Property, buildings and equipment, net 24,836,026 24,930,026
Deferred charges, net of accumulated amortization of
$100,000 and $60,000 497,266 537,046
----------- -----------
$40,939,900 $37,773,369
=========== ===========
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
Current portion of notes payable $ 1,186,270 $ 1,097,965
Escrowed deposits 891,390 965,908
Accounts payable 877,581 1,515,163
Accrued rental distribution 1,512,299 1,431,301
Accrued expenses and other liabilities 2,555,838 2,921,937
Guest deposits 2,763,681 1,909,517
Due to related parties 646,348 441,318
----------- -----------
Total current liabilities 10,433,407 10,283,109
Notes payable due after one year 22,343,335 23,529,604
----------- -----------
Total liabilities 32,776,742 33,812,713
----------- -----------
Commitments and contingencies (Note 10)
Shareholder's equity:
Common stock, $1 par, 100,000 shares authorized,
issued and outstanding 100,000 100,000
Additional paid-in capital 1,013,127 1,013,127
Accumulated earnings 7,050,031 2,847,529
----------- -----------
Total shareholder's equity 8,163,158 3,960,656
----------- -----------
$40,939,900 $37,773,369
=========== ===========
The accompanying notes are an integral part of these financial statements.
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SADDLEBROOK RESORTS, INC.
STATEMENTS OF INCOME
- -----------------------------------------------------------------------------------
YEAR ENDED
DECEMBER 31,
-----------------------------------------
2000 1999 1998
----------- ----------- -----------
Resort revenues (Note 8) $50,391,067 $47,306,209 $48,394,775
----------- ----------- -----------
Cost and expenses:
Operating costs of resort (Note 8) 33,376,033 32,292,105 31,515,915
Sales and marketing 3,897,922 3,781,059 3,548,950
General and administrative 5,003,277 5,256,616 4,297,181
Depreciation and amortization 2,057,050 1,755,644 1,573,902
Interest 1,854,283 1,885,218 1,784,187
----------- ----------- -----------
Total costs and expenses 46,188,565 44,970,642 42,720,135
----------- ----------- -----------
Net income $ 4,202,502 $ 2,335,567 $ 5,674,640
=========== =========== ===========
The accompanying notes are an integral part of these financial statements.
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SADDLEBROOK RESORTS, INC.
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
- --------------------------------------------------------------------------------------------
TOTAL
COMMON ADDITIONAL ACCUMULATED SHAREHOLDER'S
STOCK PAID-IN CAPITAL EARNINGS EQUITY
----------- --------------- ----------- -------------
Balance at December 31, 1997 $ 100,000 $ 1,013,127 $ 3,859,215 $ 4,972,342
Net income 5,674,640 5,674,640
Distributions to shareholders (2,707,361) (2,707,361)
Distribution of fixed assets to
shareholder (2,514,532) (2,514,532)
----------- ----------- ----------- -----------
Balance at December 31, 1998 100,000 1,013,127 4,311,962 5,425,089
Net income 2,335,567 2,335,567
Distributions to shareholder (3,800,000) (3,800,000)
----------- ----------- ----------- -----------
Balance at December 31, 1999 100,000 1,013,127 2,847,529 3,960,656
Net income 4,202,502 4,202,502
----------- ----------- ----------- -----------
Balance at December 31, 2000 $ 100,000 $ 1,013,127 $ 7,050,031 $ 8,163,158
=========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements.
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SADDLEBROOK RESORTS, INC.
STATEMENTS OF CASH FLOWS
- ---------------------------------------------------------------------------------------------------------
YEAR ENDED
DECEMBER 31,
--------------------------------------------
2000 1999 1998
----------- ----------- ------------
Cash flows from operating activities:
Net income $ 4,202,502 $ 2,335,567 $ 5,674,640
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 2,057,050 1,755,644 1,573,902
(Gain) loss on disposal of property, buildings
and equipment (2,132) 1,188 (124,217)
Provision for doubtful accounts 49,348 12,844 125,300
Change in assets and liabilities:
(Increase) decrease in:
Escrowed cash 73,192 (280,778) 1,194
Investments (345,300) -- --
Escrowed investments 1,326 1,085,008 (389,547)
Trade accounts receivable (893,515) 2,297,749 (1,269,015)
Resort inventory and supplies (144,931) (250,050) (14,516)
Prepaid expenses and other assets 145,651 119,813 (146,968)
Increase (decrease) in:
Escrowed deposits (74,518) (804,230) 388,353
Accounts payable (637,582) (83,541) 1,057,423
Accrued rental distribution 80,998 (181,841) 163,347
Guest deposits 854,164 (78,966) (173,137)
Accrued expenses and other liabilities (366,099) 702,532 (430,015)
----------- ----------- ------------
Net cash provided by operating activities 5,000,154 6,630,939 6,436,744
----------- ----------- ------------
Cash flows from investing activities:
Proceeds from sales of equipment 9,000 1,625 210,000
Capital expenditures (1,930,137) (4,587,029) (2,187,248)
----------- ----------- ------------
Net cash used in investing activities (1,921,137) (4,585,404) (1,977,248)
----------- ----------- ------------
Cash flows from financing activities:
Proceeds from notes payable -- -- 26,000,000
Payments on notes payable (1,097,965) (1,025,244) (19,157,336)
Distribution to shareholders -- (3,800,000) (2,707,361)
Financing costs -- (15,438) (540,637)
Due to/from related parties 576,803 (257,578) (304,753)
----------- ----------- ------------
Net cash (used in) provided by financing activities (521,162) (5,098,260) 3,289,913
----------- ----------- ------------
Net increase (decrease) in cash and cash equivalents 2,557,855 (3,052,725) 7,749,409
Cash and cash equivalents, beginning of year 5,551,280 8,604,005 854,596
----------- ----------- ------------
Cash and cash equivalents, end of year $ 8,109,135 $ 5,551,280 $ 8,604,005
=========== =========== ============
SUPPLEMENTAL DISCLOSURE:
Cash paid for interest $ 1,854,283 $ 1,942,398 $ 1,918,953
NON-CASH FINANCING AND INVESTING ACTIVITIES:
Distribution of fixed assets to shareholder $ -- $ -- $ 2,514,532
Capital lease obligation $ -- $ 123,229 $ --
The accompanying notes are an integral part of these financial statements.
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SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
- --------------------------------------------------------------------------------
1. ORGANIZATION AND BUSINESS:
Saddlebrook Resorts, Inc. (the "Company") was incorporated in the
State of Florida in June 1979 at which time it purchased a golf course
and tennis complex, as well as certain undeveloped land, located in
Pasco County, Florida, which was developed as a resort-condominium and
residential homes project. Property improvements for the resort
consist of condominiums which were sold or are for sale to outside
parties. The majority of the condominium units sold are provided as
hotel accommodations by their owners under a Rental Pool and Agency
Appointment Agreement. The resort facilities include two 18 hole golf
courses, eight tennis courts, three swimming pools, three restaurants,
a 135,000 square foot convention facility with approximately 78,000
square feet of meeting space, a luxury health spa, a fitness center,
shops and other facilities necessary for the operation of a luxury
resort.
On June 29, 1998, the Company's shareholders exchanged each share of
the outstanding common stock for one share of common stock of
Saddlebrook Holdings, Inc. ("SHI"). After the exchange, the Company's
prior shareholders own 100% of SHI which owns 100% of the Company.
2. SIGNIFICANT ACCOUNTING POLICIES:
A summary of the Company's significant accounting policies follows:
Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
Cash equivalents
All highly liquid debt instruments purchased with an original maturity
of three months or less are considered to be cash equivalents.
Resort inventory and supplies
Inventory includes operating materials and supplies and is accounted
for at the lower of first-in, first-out cost or market.
Investments
Investments held at December 31, 2000 consist of U.S. Treasury
Securities and certificates of deposit which mature on various dates
from January 2001 to May 2003 and bear interest at rates ranging
between 5.5% and 6.5%. Investments are held to maturity, and recorded
at amortized cost, which approximates fair market value. Escrowed
investments relate to rental pool unit owner deposits for the
maintenance reserve fund.
16
17
SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
- --------------------------------------------------------------------------------
Property, buildings and equipment
Property, buildings and equipment are stated at cost. Depreciation is
provided over the estimated useful lives of the assets on a
straight-line basis. Expenditures for renewals and improvements that
significantly add to or extend the useful life of an asset are
capitalized.
Expenditures for repairs and maintenance are charged to expense as
incurred. When property, buildings and equipment are retired or
otherwise disposed, the cost of the assets and related accumulated
depreciation amounts are removed from the accounts, and any resulting
gains or losses are reflected in operations.
Management periodically reviews the potential impairment of property,
buildings and equipment in order to determine the proper carrying
value of property, buildings and equipment as of each balance sheet
date presented. Based on this review, there were no adjustments made
to the carrying value of operating properties during the three years
ended December 31, 2000.
Deferred charges
In connection with the Company's refinancing of its debt during 1998,
financing costs in the amount of $597,000 were incurred and
capitalized. These financing costs are being amortized using a method
that approximates the effective interest method over fifteen years,
the life of the related debt outstanding.
Amortization expense for deferred charges amounted to $40,000, $41,000
and $87,000 for the years ended December 31, 2000, 1999 and 1998,
respectively.
Operating costs of resort
Included in operating costs of resort are service fee revenues
associated with various operating departments, primarily banquets.
Such amounts were $2,391,000, $2,397,000 and $2,577,000 for the years
ended December 31, 2000, 1999 and 1998, respectively.
Resort revenues
Resort revenues are recognized as the related service is performed and
includes rental revenues for condominium units owned by third parties
participating in the rental pool. If these rental units were owned by
the Company, normal costs associated with ownership such as
depreciation, real estate taxes, maintenance, and other costs would
have been incurred. Instead, resort operating expenses for the years
ended December 31, 2000, 1999 and 1998 include rental pool
distributions to condominium unit owners approximating $6,619,000,
$6,278,000 and $6,646,000, respectively.
Income taxes
Effective February 1, 1990, the Company elected S Corporation status
for federal and state income tax purposes. Taxable income and losses
are ultimately passed through to the shareholders, and accordingly, no
provision for income taxes has been made in the accompanying financial
statements. As of December 31, 2000, the Company has approximately
$470,000 in tax net operating loss carryforwards, which expire in
2002, available only to offset future C Corporation taxable income.
17
18
SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
- --------------------------------------------------------------------------------
Reclassifications
Certain prior year balances have been reclassified to conform with
current year presentation.
3. COMMON STOCK:
At December 31, 2000 and 1999, the Company had 50,000 shares of voting
common stock and 50,000 shares of nonvoting common stock authorized,
issued and outstanding. The par value of the voting and nonvoting
common stock was $1.00 at December 31, 2000 and 1999.
4. ESCROWED CASH:
Escrowed cash, restricted as to use, at December 31 is comprised of
the following:
2000 1999
-------- --------
Rental pool unit owner deposits for maintenance reserve fund
held in a bank account which bears an interest rate of 3.6% $282,562 $353,829
Security deposits held on long-term rentals 16,350 18,275
-------- --------
$298,912 $372,104
======== ========
5. PROPERTY, BUILDINGS AND EQUIPMENT, NET:
Property, buildings and equipment, net at December 31 consist of the
following:
ESTIMATED
USEFUL
LIVES 2000 1999
------------ ------------ -----------
Land and land improvements $ 4,412,746 $ 4,412,745
Buildings and recreational facilities 10-40 23,689,312 21,407,692
Machinery and equipment 2-15 11,848,663 11,173,064
Construction in progress 90,715 1,128,285
------------ -----------
40,041,436 38,121,786
Accumulated depreciation (15,205,410) (13,191,760)
------------ -----------
$ 24,836,026 $24,930,026
============ ===========
Substantially all property, buildings and equipment are mortgaged,
pledged or otherwise subject to lien under loan agreements (Note 7).
On June 29, 1998, the Company distributed to its shareholders at its
aggregate book value of approximately $2,515,000, its unencumbered
condominium units, tennis courts and certain tracts of real property.
Depreciation expense amounted to $2,017,000, $1,715,000 and $1,487,000
for the years ended December 31, 2000, 1999 and 1998, respectively.
The Company leases certain equipment under an agreement which is
classified as a capital lease. The equipment and obligations related
to the lease are recorded at the present value of the minimum lease
payments. During 2000 and 1999, the Company recorded approximately
$7,000 and $11,000,
18
19
SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
- --------------------------------------------------------------------------------
respectively, of interest expense related to the lease. Depreciation
is computed on a straight-line basis over the estimated useful life of
the asset. Total depreciation expense on the asset under lease was
approximately $24,000 during 2000 and 1999.
The Company leases certain equipment under operating leases. Some of
the leases contain annual renewal options after the initial lease
term. Lease expense amounted to $228,000, $319,000 and $228,000 for
the years ended December 31, 2000, 1999 and 1998, respectively. Future
minimum lease payments for noncancelable operating leases with initial
lease terms in excess of one year approximate:
2001 $164,355
2002 115,788
2003 110,940
2004 110,940
2005 and thereafter 110,940
--------
$612,963
========
6. ACCRUED EXPENSES AND OTHER LIABILITIES
Accrued expenses and other liabilities consist of the following:
DECEMBER 31,
-------------------------
2000 1999
---------- ----------
Accrued payroll and related expenses $1,060,383 $ 770,608
Accrued taxes 38,250 77,633
Accrued insurance 864,164 568,380
Other accrued expenses and other liabilities 593,041 1,505,316
---------- ----------
$2,555,838 $2,921,937
========== ==========
19
20
SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
- --------------------------------------------------------------------------------
7. NOTES PAYABLE:
Notes payable at December 31 consists of the following:
2000 1999
------------ ------------
Note payable to lender, 15 year term, 7.70%
fixed interest rate, monthly ratable principal
and interest payments, secured by all current
and subsequently acquired real
and personal property $ 23,456,539 $ 24,532,820
Capital lease obligation 73,066 94,749
Less current portion (1,186,270) (1,097,965)
------------ ------------
$ 22,343,335 $ 23,529,604
============ ============
On June 29, 1998, the Company financed a $26 million note payable. The
proceeds from the note payable were used principally to retire the
prior debt. Under the terms of the agreement, the Company is required
to meet debt service coverage ratios as defined. The Company was in
compliance at December 31, 2000. The Company has the ability to obtain
an additional $5 million from the same lender under the terms of the
agreement.
Principal maturities of the note payable are due as follows: 2002 -
$1,281,699; 2003 - $1,377,062; 2004 - $1,463,058; 2005 and thereafter
- $18,221,516.
8. RESORT REVENUES AND OPERATING COSTS OF RESORT:
Resort revenues and operating costs of resort for the years ended
December 31 are comprised of the following:
2000 1999 1998
----------- ----------- -----------
Resort Revenues
Room revenue subject to rental pool agreement $16,444,206 $15,555,374 $16,310,670
Food and beverage 15,683,605 14,764,053 15,682,829
Resort facilities and other 18,263,256 16,986,782 16,401,276
----------- ----------- -----------
$50,391,067 $47,306,209 $48,394,775
=========== =========== ===========
Operating Costs of Resort
Room expense subject to rental pool agreement $ 6,618,602 $ 6,278,003 $ 6,646,176
Food and beverage 10,383,120 10,239,266 9,810,205
Resort facilities and other 16,374,311 15,774,836 15,059,534
----------- ----------- -----------
$33,376,033 $32,292,105 $31,515,915
=========== =========== ===========
20
21
SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
- --------------------------------------------------------------------------------
9. RELATED PARTY TRANSACTIONS
At December 31, 2000 and 1999, a net payable of approximately $584,000
and $326,000, respectively, was due to SHI, the Company's parent (Note
1), primarily relating to dividends declared to the Company's
shareholders during 1994 in the amount of $350,000 which were unpaid
as of December 31, 2000 and net intercompany charges and cash
transfers.
Saddlebrook International Tennis, Inc. ("SIT") is a tennis training
facility and preparatory school operating at the resort. SIT is solely
owned by the Company's parent. The Company charges SIT various amounts
for services provided to SIT guests, which amounted to approximately
$2,363,000, $2,142,000 and $1,947,000 for the years ended December 31,
2000, 1999 and 1998, respectively. In addition, the Company was
reimbursed for expenses and other costs incurred on behalf of SIT. At
December 31, 2000 and 1999, the amounts due to/from SIT were included
in the net payable to SHI.
Saddlebrook Investments, Inc. is a broker/dealer for sales of
Saddlebrook Resort condominium units. Saddlebrook Realty, Inc. is a
broker/dealer for the sale of other general real estate. These
companies are solely owned by the majority shareholder of the
Company's parent. At December 31, 2000 and 1999, a net receivable of
approximately $41,000 and a net payable of approximately $98,000,
respectively, resulted from net intercompany charges and cash
transfers with these entities.
The Company performs certain accounting and property management
activities on behalf of the Saddlebrook Resort Condominium Association
(the "Association") and is reimbursed for expenses paid on behalf of
the Association. Expenses paid on behalf of and services provided to
the Association amounted to approximately $1,050,000, $1,012,000 and
$976,000 for the years ended December 31, 2000, 1999 and 1998,
respectively. At December 31, 2000 and 1999, a net receivable of
approximately $95,000 and $101,000 respectively, was due from the
Association.
Due from related parties also consists of other miscellaneous
receivables and employee advances owed the Company of approximately
$23,000 and $25,000 at December 31, 2000 and 1999, respectively.
10. COMMITMENTS AND CONTINGENCIES
The Company is involved in litigation in the ordinary course of
business. In the opinion of management, these matters are adequately
covered by insurance or indemnification from other third parties
and/or the effect, if any, of these claims is not material to the
reported financial condition or results of operations of the Company
as of December 31, 2000.
Insurance pool
The Company has pooled its risks with other resorts by forming an
insurance purchasing group in which they retain an equity interest and
to which they pay insurance premiums. The Company's ownership is less
than 9% and all amounts contributed as capital ($122,950 as of
December 31, 2000) are reflected as prepaid expenses and other assets
in the accompanying Balance Sheets. The Company's investment
approximates the proportionate net book value of the insurance company
as of December 31, 2000. The Company may withdraw from the risk pool
at any renewal date (annually).
21
22
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors of Saddlebrook
Resorts, Inc., as Operators under the Saddlebrook
Rental Pool and Agency Appointment Agreement
In our opinion, the accompanying balance sheets and the related statements of
operations and of changes in participants' fund balance present fairly, in all
material respects, the financial position of the Saddlebrook Rental Pool
Operation (funds created for participants who have entered into a rental pool
agreement as explained in Note 1) at December 31, 2000 and 1999, and the
results of its operations and the changes in participants' fund balance for
each of the three years in the period ended December 31, 2000 in conformity
with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the rental pool's
operators; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in
accordance with auditing standards generally accepted in the United States of
America, which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Tampa, Florida
March 9, 2001
22
23
SADDLEBROOK RENTAL POOL OPERATION
BALANCE SHEETS
- ------------------------------------------------------------------------------
DISTRIBUTION FUND
DECEMBER 31,
------------------------
2000 1999
---------- ----------
ASSETS
Receivable from Saddlebrook Resorts, Inc. $1,551,111 $1,354,525
========== ==========
LIABILITIES AND PARTICIPANTS' FUND BALANCE
Due to participants for rental pool distribution $1,290,258 $1,108,663
Due to maintenance escrow fund 260,853 245,862
Participants' fund balance --
---------- ----------
$1,551,111 $1,354,525
========== ==========
MAINTENANCE ESCROW FUND
DECEMBER 31,
------------------------
2000 1999
---------- ----------
Cash in bank $ 282,562 $ 353,829
Investments 592,478 593,804
Receivables:
Distribution fund 260,853 245,862
Interest 17,774 8,180
Prepaid expenses and other assets 1,620,786 636,669
Linen inventory 250,360 222,188
---------- ----------
$3,024,813 $2,060,532
========== ==========
LIABILITIES AND PARTICIPANTS' FUND BALANCE
Due to Saddlebrook Resorts, Inc. $ 155,299 $ 321,796
Accounts payable 39,136 18,934
Participants' fund balance 2,830,378 1,719,802
---------- ----------
$3,024,813 $2,060,532
========== ==========
The accompanying notes are an integral part of these financial statements.
23
24
SADDLEBROOK RENTAL POOL OPERATION
STATEMENTS OF OPERATIONS
- ---------------------------------------------------------------------------------------
DISTRIBUTION FUND
YEAR ENDED
DECEMBER 31,
----------------------------------------------
2000 1999 1998
------------ ------------ ------------
Rental pool revenues $ 16,444,206 $ 15,555,374 $ 16,310,670
------------ ------------ ------------
Deductions:
Marketing fee 1,233,316 1,166,653 1,223,299
Management fee 2,055,526 1,944,422 2,038,834
Travel agent commissions 851,527 746,589 698,483
Credit card expense 205,612 197,293 160,148
Bad debt expense -- 33,000 53,000
------------ ------------ ------------
4,345,981 4,087,957 4,173,764
------------ ------------ ------------
Net rental income 12,098,225 11,467,417 12,136,906
Operator share of net rental income (5,444,201) (5,160,338) (5,461,608)
Other revenues (expenses):
Complimentary room revenues 103,144 103,488 92,121
Minor repairs and replacements (138,566) (132,564) (121,243)
------------ ------------ ------------
Amounts available for distribution to
participants and maintenance
escrow fund $ 6,618,602 $ 6,278,003 $ 6,646,176
============ ============ ============
The accompanying notes are an integral part of these financial statements.
24
25
SADDLEBROOK RENTAL POOL OPERATION
STATEMENTS OF CHANGES IN PARTICIPANTS' FUND BALANCE
- ----------------------------------------------------------------------------------------------
DISTRIBUTION FUND
YEAR ENDED
DECEMBER 31,
-------------------------------------------
2000 1999 1998
----------- ----------- -----------
Balance, beginning of period $ -- $ -- $ --
Additions:
Amounts available for distribution 6,618,602 6,278,003 6,646,176
Reductions:
Amounts withheld for maintenance
escrow fund (1,174,401) (1,117,665) (1,184,568)
Amounts accrued or paid to participants (5,444,201) (5,160,338) (5,461,608)
----------- ----------- -----------
Balance, end of period $ -- $ -- $ --
=========== =========== ===========
MAINTENANCE ESCROW FUND
YEAR ENDED
DECEMBER 31,
-------------------------------------------
2000 1999 1998
----------- ----------- -----------
Balance, beginning of period $ 1,719,802 $ 2,440,102 $ 1,852,584
Additions:
Amount withheld from distribution fund 1,174,401 1,117,665 1,184,568
Unit owner payments 1,393,582 288,909 554,024
Interest earned 57,273 77,792 79,361
Reductions:
Unit renovations (904,795) (1,690,746) (716,219)
Refunds of excess amounts in escrow accounts (118,608) (209,874) (145,966)
Maintenance charges (421,461) (217,416) (249,025)
Linen amortization (69,816) (86,630) (119,225)
----------- ----------- -----------
Balance, end of period $ 2,830,378 $ 1,719,802 $ 2,440,102
=========== =========== ===========
The accompanying notes are an integral part of these financial statements.
25
26
SADDLEBROOK RESORTS, INC.
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. RENTAL POOL OPERATIONS AND RENTAL POOL AGREEMENT:
Condominium units are provided as rental (hotel) accommodations by
their owners under the Rental Pool and Agency Appointment Agreement
(the "Agreement") with Saddlebrook Resorts, Inc. (collectively, the
"Rental Pool"). Saddlebrook Resorts, Inc. ("Saddlebrook") acts as
operator of the Rental Pool, which provides for the distribution of a
percentage of net rental income, as defined, to the owners.
The Saddlebrook Rental Pool Operation consists of two funds, the
Rental Pool Income Distribution Fund ("Distribution Fund") and the
Maintenance and Furniture Replacement Escrow Fund ("Maintenance Escrow
Fund"). The operations of the Distribution Fund reflect the earnings
of the Rental Pool. The Distribution Fund balance sheets reflect
amounts due from Saddlebrook for the rental pool distribution payable
to participants and amounts due to the Maintenance Escrow Fund. The
amounts due from Saddlebrook are required to be distributed no later
than forty-five days following the end of each calendar quarter. The
Maintenance Escrow Fund reflects the accounting for escrowed assets
used to maintain unit interiors and replace furniture as it becomes
necessary.
Rental pool participants and Saddlebrook share rental revenues
according to the provisions of the Agreement. Net Rental Income shared
consists of rentals received less a marketing surcharge of 7.5%, a
12.5% management fee, travel agent commissions, credit card expense
and provision for bad debts, if warranted. Saddlebrook receives 45% of
Net Rental Income as operator of the Rental Pool. The remaining 55% of
Net Rental Income after adjustments for complimentary room revenues
(ten percent of the normal unit rental price paid by Saddlebrook for
promotional use of the unit) and certain minor repair and replacement
charges is available for distribution to the participants and
maintenance escrow fund based upon each participants' respective
participation factor (computed using the value of a furnished unit and
the number of days it was available to the pool). Quarterly, 45% of
Net Rental Income is distributed to participants, and 10%, as adjusted
for complimentary room revenues and minor interior maintenance and
replacement charges, is deposited in an escrow account until a maximum
of 20% of the set value of the individual owner's furniture package
has been accumulated. Excess escrow balances are refunded to
participants.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of accounting
The accounting records of the funds are maintained on the accrual
basis of accounting.
Investments
Investments consist of U.S. Treasury Securities which bear interest at
rates ranging from 5.5% to 6.5% (4.6% to 6.5% for 1999). At December
31, 2000 and 1999, investments of $293,652 and $195,251, respectively,
mature in one year or less.
Income taxes
No federal or state taxes have been reflected in the accompanying
financial statements as the tax effect of fund activities accrues to
the rental pool participants and operator.
26
27
INDEX TO EXHIBITS
Sequential
Number and Description of Exhibit Page Number
3.1 Articles of Incorporation of Saddlebrook Resorts, Inc., a
Florida corporation (incorporated by reference to Exhibit A*).
3.2 Corporate By-laws of Saddlebrook Resorts, Inc. (incorporated
by reference to Exhibit B*).
4. Declaration of Condominium, together with
the following: (1) Articles of Incorporation of the Saddlebrook
Association of Condominium Owners, Inc. a Florida non-profit
corporation; (2) By-laws of the Saddlebrook Association of
Condominium Owners, Inc., and (3) Rules and Regulations of the
Saddlebrook Association of Condominium Owners, Inc. (incorporated
by reference to Exhibit C*).
10.1 Management Contract between Saddlebrook Resorts, Inc. and the
Saddlebrook Association of Condominium Owners, Inc.
(incorporated by reference to Exhibit C*).
10.2 Saddlebrook Rental Pool and Agency Appointment Agreement.
10.3 Saddlebrook Rental Management Agency Employment (incorporated
by reference to Exhibit E*).
10.4 Form of Purchase Agreement (incorporated by reference to
Exhibit H*).
10.5 Form of Deed (incorporated by reference to Exhibit I*).
10.6 Form of Bill of Sale (incorporated by reference to
Exhibit J*).
28. Interest Being Registered. Pages 21 and 22 of the
Post-Effective Amendment No. 9 to Registration Statement on
Form S-1 No. 2-65481 filed by the Registrant on March 25,
1986.
* Identification of exhibit incorporated by reference from the
Registration Statement No. 2-65481 previously filed by
Registrant, effective December 28, 1979.
27