-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F3Qq7uLI1MvX36lEAwKISqX/F/GYrOJca/IK7mnDVNRciNir9N4WSa70N9316vIw p5nJTS8NwZFkoxiSnc5PeA== 0000950144-01-505833.txt : 20010815 0000950144-01-505833.hdr.sgml : 20010815 ACCESSION NUMBER: 0000950144-01-505833 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20010814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ORIOLE HOMES CORP CENTRAL INDEX KEY: 0000074928 STANDARD INDUSTRIAL CLASSIFICATION: OPERATIVE BUILDERS [1531] IRS NUMBER: 591228702 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06963 FILM NUMBER: 1710569 BUSINESS ADDRESS: STREET 1: 1690 S CONGRESS AVE STE 200 CITY: DELRAY BEACH STATE: FL ZIP: 33445 BUSINESS PHONE: 4072742000 FORMER COMPANY: FORMER CONFORMED NAME: ORIOLE LAND & DEVELOPMENT CORP DATE OF NAME CHANGE: 19720615 10-Q 1 g71225e10-q.txt ORIOLE HOMES CORP. 1 SECURITIES AND EXCHANGE COMMISSION ---------------------------------- Washington, D.C. 20549 Form 10Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended: June 30, 2001 Commission File No. 1-6963 ORIOLE HOMES CORP. - ----------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Florida 59-1228702 - --------------------------------- --------------------------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 1690 S. Congress Ave., Suite 200 Delray Beach, Fl. 33445 - -------------------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (561) 274-2000 ------------------------------------------------------------------------------ Former name, former address and former fiscal year, if changed since last report. 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, 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 issuers classes of common stock, as of the close of the period covered by this report. Class Outstanding at July 13, 2001 - ------------------------------------- ----------------------------------- Common Stock, Class A, par value $.10 1,863,649 Common Stock, Class B, par value $.10 2,761,875 2 PART 1 - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS ORIOLE HOMES CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ASSETS
June 30, December 31, 2001 2000 (Unaudited) (Audited) ------------ ------------ Cash and cash equivalents $ 16,971,305 $ 21,707,756 ------------ ------------ Inventories Land 57,211,454 62,346,437 Homes completed or under construction 39,788,472 34,445,028 Model homes 4,247,717 4,310,488 ------------ ------------ 101,247,643 101,101,953 Less estimated costs of completion included in inventories 14,902,624 16,242,461 ------------ ------------ 86,345,019 84,859,492 ------------ ------------ Property and equipment, at cost Land 81,379 81,379 Buildings 458,855 664,065 Furniture, fixtures and equipment 3,012,222 3,044,175 ------------ ------------ 3,552,456 3,789,619 Less accumulated depreciation 2,133,166 2,127,155 ------------ ------------ 1,419,290 1,662,464 ------------ ------------ Land held for investment, at cost 1,898,910 1,857,300 Other Prepaid expenses 2,031,631 1,713,099 Unamortized debt issuance costs 312,033 392,752 Other assets 2,733,512 2,384,853 ------------ ------------ 5,077,176 4,490,704 ------------ ------------ Total assets $111,711,700 $114,577,716 ============ ============
The accompanying notes are an integral part of these statements -1- 3 ORIOLE HOMES CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS LIABILITIES AND SHAREHOLDERS' EQUITY
June 30, December 31, 2001 2000 (Unaudited) (Audited) ------------ ------------ Liabilities Line of credit $ -- $ 10,000 Mortgage notes payable 15,317,189 20,415,730 Accounts payable and accrued liabilities 9,476,504 10,022,048 Customer deposits 16,089,768 10,190,140 Senior notes 33,463,364 34,584,277 ------------ ------------ Total liabilities 74,346,825 75,222,195 Shareholders' equity Class A common stock, $.10 par value Authorized - 10,000,000 shares, issued and outstanding - 1,863,649 in 2001 and 2000, respectively 186,365 186,365 Class B common stock, $.10 par value Authorized - 10,000,000 shares, issued and outstanding - 2,761,875 in 2001 and 2000, respectively 276,188 276,188 Additional paid-in capital 19,267,327 19,267,327 Retained earnings 17,634,995 19,625,641 ------------ ------------ Total shareholders' equity 37,364,875 39,355,521 ------------ ------------ Total liabilities and shareholders' equity $111,711,700 $114,577,716 ============ ============
The accompanying notes are an integral part of these statements -2- 4 ORIOLE HOMES CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Six Months Ended Three Months Ended June 30, June 30, ------------------------------- ------------------------------- 2001 2000 2001 2000 ------------ ------------ ------------ ------------ Revenues Sales of homes $ 52,041,751 $ 28,532,546 $ 22,128,047 $ 12,455,920 Other operating revenues -- 56,779 -- 20,502 Gain (loss) on sale of land held for investment and other assets, net 95,568 674,740 (6,650) 147,601 Interest, rentals and other income 1,102,919 1,151,278 552,046 589,584 ------------ ------------ ------------ ------------ 53,240,238 30,415,343 22,673,443 13,213,607 ------------ ------------ ------------ ------------ Costs and expenses Cost of homes sold 47,185,238 25,704,441 20,329,495 11,579,080 Costs relating to other operating revenues 4,502 130,362 (1,401) 55,178 Selling, general and administrative expenses 8,041,144 6,915,460 3,618,518 3,161,727 Interest costs incurred 3,427,429 2,744,269 1,640,419 1,306,991 Interest capitalized (deduct) (3,427,429) (2,704,039) (1,640,419) (1,306,991) ------------ ------------ ------------ ------------ 55,230,884 32,790,493 23,946,612 14,795,985 ------------ ------------ ------------ ------------ Net loss $ (1,990,646) $ (2,375,150) $ (1,273,169) $ (1,582,378) ============ ============ ============ ============ Net loss per Class A and B common share available for common stockholders - Basic and Diluted $ (.43) $ (.51) $ (.27) $ (.34) ============ ============ ============ ============ Weighted average number of common stock outstanding - Basic and Diluted 4,625,524 4,625,524 4,625,524 4,625,524 ============ ============ ============ ============
The accompanying notes are an integral part of these statements -3- 5 ORIOLE HOMES CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended June 30, ------------------------------- 2001 2000 ------------ ------------ Cash flows from operating activities Net loss $ (1,990,646) $ (2,375,150) Adjustments to reconcile net (loss) to net cash provided by (used in) operating activities Depreciation 230,461 248,812 Amortization 135,955 315,279 Gain on sales of property and equipment and land held for investment, net (112,144) (674,740) (Increase) decrease in operating assets Receivables -- 262,240 Inventories (1,527,137) 137,030 Other assets (672,340) 53,380 Increase (decrease) in operating liabilities Accounts payable and accrued liabilities (545,544) (115,113) Customer deposits 5,899,628 2,636,495 ------------ ------------ Total adjustments 3,408,879 2,863,383 ------------ ------------ Net cash provided by operating activities 1,418,233 488,233 ------------ ------------ Cash flows from investing activities Return on investment in joint ventures -- 1,242,240 Capital expenditures (104,278) (876,584) Proceeds from the sale of property and equipment and land held for investment 229,135 1,495,385 ------------ ------------ Net cash provided by investing activities 124,857 1,861,041 ------------ ------------ Cash flows from financing activities Proceeds of mortgage notes 9,110,005 394,243 Payment of mortgage notes (14,208,546) (1,603,157) Repayment of line of credit (10,000) -- Repurchase of senior notes (1,171,000) (6,622,000) ------------ ------------ Net cash used in financing activities (6,279,541) (7,830,914) ------------ ------------ Net decrease in cash and cash equivalents (4,736,451) (5,481,640) Cash and cash equivalents at beginning of period 21,707,756 18,708,081 ------------ ------------ Cash and cash equivalents at end of period $ 16,971,305 $ 13,226,441 ============ ============ Supplemental disclosures of cash flow information Cash paid during the period for: Interest (net of amount capitalized) $ 15,169 $ 396,518 Income taxes $ -- $ --
The accompanying notes are an integral part of these statements -4- 6 ORIOLE HOMES CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. The consolidated balance sheet as of June 30, 2001 and the related statements of operations and cash flows for the three months and six months ended June 30, 2001 and 2000 of Oriole Homes Corp. (together with its consolidated subsidiaries, the "Company") have been prepared by the Company without audit. In the opinion of management of the Company, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation of the unaudited interim periods have been reflected herein. Certain footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted. It is suggested that these consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2000 annual report on Form 10K. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. 2. The results of operations for the three months and the six months ended June 30, 2001 are not necessarily indicative of the results for the entire year. The Company allocates certain costs to units delivered based upon estimates of the number of units projected to be delivered and the associated timing of the deliveries. When it becomes apparent that the number of deliveries in a project will vary significantly from the estimates, the Company will revise these cost allocations, which will affect results of operations. The Company's consolidated statements of operations for the three- and six-month periods ended June 30, 2001 include revenues and expenses of the Vizcaya Project, which was acquired in August 2000. Accordingly, the results of operations for the three- and six-month periods ended June 30, 2001 are not directly comparable to the results of operations for the three- and six-month periods ended June 30, 2000. 3. Backlog of contracts for sales of homes:
June 30, 2001 December 31, 2000 ----------------------------------- ------------------------------ Units Amounts Units Amounts --------------- ----------------- ------------ --------------- Single-family 431 $103,617,085 294 $63,914,626 Multi-family 192 29,589,105 166 23,047,090 --- ------------ --- ----------- Total 623 $133,206,190 460 $87,961,716 === ============ === ===========
The Vizcaya Project contributed 156 of the 623 total homes and $30.6 million of the $133.2 million backlog at June 30, 2001, as compared to 123 of 460 total homes and $24.0 million of the $88.0 million backlog at December 31, 2000. -5- 7 ORIOLE HOMES CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 4. Senior notes On January 13, 1993, the Company issued 12 1/2% senior notes ("Senior Notes"), due January 15, 2003. The Senior Notes have a face value of $70,000,000 and were issued at a discount of $1,930,600. The Senior Notes are senior unsecured obligations of the Company currently subject to redemption at the Company's option at 100% of the principal amount. Under the terms of the indenture ("Indenture"), the Company must make sinking fund payments of $17,500,000 by January 15, 2001 and January 15, 2002. As of June 30, 2001, the Company had satisfied the requirements of each of the sinking fund payments. The Indenture also contains provisions restricting the amount and type of indebtedness the Company may incur, the purchase by the Company of its stock and the payment of cash dividends. At June 30, 2001, the payment of cash dividends is prohibited and will be restricted until the Company posts cumulative net income in excess of $80,057,169. On July 16, 2001, the Company effected an optional redemption of the Senior Notes. See Note 10 below. 5. Line of credit At June 30, 2001, the Company had decided not to renew its $10,000,000 Revolving Line of Credit facility and to rely, instead, on its available cash and new credit facilities discussed at Note 10. 6. Mortgage Notes On August 8, 2000, in connection with the Vizcaya project, a wholly owned subsidiary of the Company borrowed an aggregate principal amount of $26,787,200; of which $9,580,430 is for future construction costs (the "Vizcaya Loan"). The Vizcaya Loan is evidenced by a mortgage note, which is due on February 8, 2003 and bears interest at a floating rate equal to the Prime Rate, currently 6.75% per annum. The Vizcaya Loan is secured by real property and other assets acquired in connection with the acquisition of the Vizcaya project. The Company has agreed to guarantee up to an aggregate of $2.0 million of the Vizcaya Loan. Certain individual guarantors, not related to the Company, have agreed to jointly and severally guarantee the Vizcaya Loan. -6- 8 ORIOLE HOMES CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 7. Income taxes At June 30, 2001, the Company has no deferred tax benefit related to its net operating loss as the Company's ability to realize these benefits is not "more likely than not" as defined by SFAS Statement No. 109 "Accounting for Income Taxes". 8. Segment information The Company has the following two reportable segments: home building and rental operations. The home building segment develops and sells residential properties and planned communities. The rental operations segment consists of no units at June 30, 2001 and 23 units at June 30, 2000. Selected segment information is set forth below (in thousands):
Six Months Ending Three Months Ending June 30, June 30, ------------------------ ------------------------ 2001 2000 2001 2000 $ $ $ $ ------- ------- ------- ------- Revenues Home Building 53,002 30,155 22,553 13,095 Rental Operations -- 57 -- 21 Other 238 203 120 97 ------- ------- ------- ------- Total 53,240 30,415 22,673 13,213 ======= ======= ======= ======= Segment net income (loss) Home Building (2,176) (2,396) (1,381) (1,597) Rental Operations -- (74) -- (35) Other 185 95 108 50 ------- ------- ------- ------- Total (1,991) (2,375) (1,273) (1,582) ======= ======= ======= =======
9. Commitments and contingencies The Company is involved, from time to time, in litigation arising in the ordinary course of business, none of which is expected to have a material adverse effect on the Company's consolidated financial position or results of operations. The Company is also subject to the normal obligations associated with entering into contracts for the purchase, development and sale of real estate in the routine conduct of its business. -7- 9 ORIOLE HOMES CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 10. Subsequent Events On July 16, 2001, the Company effected an optional redemption of all of its outstanding 12 1/2% Senior Notes due 2003. The total redemption price, including accrued interest of $2,112,688, was $35,915,688. Of this amount, $33,313,737 was provided by the financing arrangement described below and $2,601,951 from available cash. On July 16, 2001, the Company also borrowed an aggregate principal amount of $49,878,136, of which $15,451,742 was for future construction costs (the "Loans"). The Loans are secured by real property (land and related improvements) by four separate mortgage notes. Interest is at the specified prime rate of the bank plus 0.50%. At July 16, the interest rate was 7.25%. Interest is to be paid monthly and partial payments of principal are to be made upon delivery of homes. The principal must be paid in full at various maturities ranging from 18 to 24 months. -8- 10 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW GENERAL The results of operations for interim periods during the year are not necessarily indicative of results of operations for the fiscal year. The Company allocates certain costs to units delivered based upon estimates of the number of annual units projected to be delivered and the associated timing of the deliveries. In past years, the Company has experienced inventory valuation adjustments reducing net income when expected deliveries fell short of expectations. These included adjustments of $13.9 million in 1995, $21.6 million in 1997 and $4.9 million in 1999. RESULTS OF OPERATIONS The Company's consolidated statements of operations for the three- and six-month periods ended June 30, 2001 includes the results of operations of the Vizcaya project acquired on August 8, 2000. Accordingly, the results of operations for the three- and six-month periods ended June 30, 2001 are not directly comparable to the results of operations for the three- and six-month periods ended June 30, 2000. Among other things, the acquisition contributed the delivery of 33 homes producing aggregate revenue of $6.7 million and net income of $160,403 for the three-month period ended June 30, 2001 and 95 homes producing aggregate revenue of $19.3 million and net income of $803,403 for the six-month period ended June 30, 2001. The Company's backlog at June 30, 2001 related to the Vizcaya project is 156 homes representing aggregate revenue of $30.6 million. THREE MONTHS ENDED JUNE 30, 2001 COMPARED TO THREE MONTHS ENDED JUNE 30, 2000 The Company's revenues from home sales increased $9.7 million (77.7%) to $22.1 million during the second quarter of 2001 as compared to the comparable quarter of 2000 as a result of an increase in the number of homes delivered and an increase in the average selling price. Oriole delivered 118 homes in the 2001 second quarter compared to 82 in the same period in 2000. The average selling price of homes delivered increased from $151,900 per home to $187,800, primarily as the result of the higher selling prices of homes that were part of the Vizcaya project. The number of contracts signed at 196 and the aggregate dollar value of those contracts at $43.7 million increased in the 2001 second quarter from 143 and $22.5 million, respectively, from the same period in 2000, primarily due to the Vizcaya project. Non-homebuilding revenues remained substantially unchanged in the quarter ended June 30, 2001 as compared to June 30, 2000. Cost of home sales increased to $20.3 million (75.0%) from $11.6 million in 2000 primarily as a result of an increase in the number of homes delivered. As a percentage of home sales, cost of sales decreased to 91.8% from 93.0% in the second quarter of 2001 primarily due to the increased deliveries of homes. Selling, general and administrative expenses increased $456,791 in dollar value and decreased as a percentage of revenues to 16.0% from 23.9% as compared to the same period in 2000 due to the fixed portions of these expenses remaining relatively constant despite the $9.7 million increase in revenues. The Company incurred a net loss for the quarter ended June 30, 2001 of $1.3 million or $0.27 per share compared to a net loss of $1.6 million or $0.34 per share during the same period in 2000. Earnings before interest, taxes, depreciation and amortization (EBITDA) increased $0.6 million to $0.3 million in the second quarter of 2001 as compared to the same period in 2000. -9- 11 SIX MONTHS ENDED JUNE 30, 2001 COMPARED TO SIX MONTHS ENDED JUNE 30, 2000 The Company's revenues from home sales increased $23.5 million (82.4%) to $52.0 million during the six-month period of 2001 as compared to 2000 as a result of an increase in the number of homes delivered and an increase in the average selling price. Oriole delivered 285 homes in the first six months of 2001 compared to 179 in the same period in 2000. The average selling price of homes delivered increased from $159,400 per home to $182,633 primarily as a result of the higher selling prices of homes that were part of the Vizcaya project. The number of contracts signed at 448 and the aggregate dollar value of those contracts at $97.3 million increased in the first six months of 2001 from 336 and $52.8 million, respectively, during the same period in 2000, primarily due to the Vizcaya project. Non-homebuilding revenues decreased $684,310 in the six-month period ended June 30, 2001 as compared to June 30, 2000. This was primarily due to gains associated with the sale of certain properties in 2000. Cost of home sales increased to $47.1 million (83.6%) in 2001 from $25.7 million in 2000 primarily as a result of the increase in the number of homes delivered. As a percentage of home sales, cost of sales increased to 90.7% from 90.0% in the first six months of 2001 due to the Company's decision to reduce sales prices on certain remaining homes to close out completed communities. Selling, general and administrative expenses increased $1.1 million in the first six months of 2001 when compared to the same period in 2000. These expenses decreased as a percentage of revenues to 15.1 % from 22.7% for the same period in 2000 primarily due to increased home sale revenues. The Company incurred a net loss for the first six months of 2001 of $2.0 million, or $.43 per share, compared to a net loss of $2.4 million, or $0.51 per share in the same period of 2000. Earnings before interest, taxes, depreciation and amortization (EBITDA) increased $1.0 million to $1.4 million in the first six months of 2001 as compared to the same period in 2000. LIQUIDITY AND CAPITAL RESOURCES The Company's cash requirements vary from period to period depending upon changes in inventory, land acquisition and development requirements, construction in progress and, to a lesser extent, the Company's current net income. The Company obtains funds for its cash requirements from operations, the sale of investment property and borrowings. In connection with land acquisitions and development, the Company may borrow money secured by land and improvements. During the first six months of 2001, the Company used a portion of available cash to purchase $1.2 million of senior notes and to reduce the net principal of certain mortgage notes by $5.1 million. At June 30, 2001, the Company had approximately $17.0 million in cash and cash equivalents. On June 30, 2001, the Company's line of credit expired. On July 16, 2001 the Company obtained a credit facility having an availability of approximately $15,450,000 for future construction costs secured by mortgages on certain real property. The Company believes that funds from operations, available cash and cash available under this credit facility will be sufficient to provide for its cash requirements through June 30, 2002. FORWARD LOOKING STATEMENTS Certain statements made in this document, including certain statements made in Management's Discussion and Analysis, are "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or similar expressions, or which involve hypothetical events. In addition, any statements concerning future financial performance (including future revenues, earnings, or -10- 12 growth rates), ongoing business strategies or prospects, and possible future Company actions, which may be provided by management, are also forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based upon current expectations and projections about future events and are subject to risks, uncertainties, and assumptions about the Company, economic and market factors and the industry in which the Company does business, among other things. These statements are not guaranties of future performance and the Company has no specific intention to update these statements. Actual events and results may differ materially from those expressed or forecasted in forward-looking statements due to a number of factors. The principal important risk factors that could cause the Company's actual performance and future events and actions to differ materially from such forward-looking statements, include but are not limited to the following: changes in consumer preferences, increases in interest rates, a reduction in labor availability, increases in the cost of labor and materials, changes in the regulatory environment particularly as relates to zoning and land use, competitive pricing pressures, changes in federal income tax laws, the general state of the economy, both nationally and in the Company's market and unseasonable weather trends. -11- 13 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K Exhibits and Reports on Form 8K (a) Exhibits Exhibit 10.37- Stock Option Agreement with Paul Lehrer dated May 10, 2001. Exhibit 10.38- Stock Option Agreement with George Richards dated May 10, 2001. (b) The Company filed Reports on Form 8-K dated June 19, 2001 setting forth in Item 5 and Item 7 a press release regarding the redemption of the Company's Senior Notes due 2003 and financing by the Company relating to the redemption and for working capital purposes. No other Form 8-K was filed for the three months ended June 30, 2001. -12- 14 SIGNATURES Pursuant to the requirements of Section 13, 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. ORIOLE HOMES CORP. ---------------------------------- (Registrant) DATE: AUGUST 13, 2001 /s/ R.D. LEVY - ----------------------- ----------------------------------- R.D. Levy, Chairman of the Board, Chief Executive Officer, Director DATE: AUGUST 13, 2001 /s/ J. PIVINSKI - ----------------------- -------------------------------------- J. Pivinski, Vice President - Finance, Treasurer, Chief Financial Officer -13- EX-10.37 3 g71225ex10-37.txt STOCK OPTION AGREEMENT WITH PAUL LEHRER 1 EXHIBIT 10.37 STOCK OPTION AGREEMENT FOR NONEMPLOYEE DIRECTORS AGREEMENT dated this 10th day of May, 2001, between Oriole Homes Corp., a Florida corporation (hereinafter called the "Company"), and Paul R. Lehrer (hereinafter called the "Eligible Director"). W I T N E S S E T H: WHEREAS, the Company's shareholders approved (on May 9, 1994) the adoption of the 1994 Stock Option Plan for Nonemployee Directors (the "Plan") pursuant to which each Eligible Director is entitled to receive a grant to purchase 1,200 Shares per year, up to a maximum of 6,000 Shares: WHEREAS, the Company's Board of Directors approved (on May 12, 1999) the adjustment of the maximum Shares pursuant to Article 7 of the 1994 Stock Option Plan for Nonemployee Directors (the "Plan") each Eligible Director is now entitled to a maximum of 12,000 Shares: WHEREAS, the Executive Committee of the Board of Directors of the Company (the "Committee") has this day granted to each Eligible Director an option to purchase 1,200 shares of Class B Common Stock, par value $.10 per share, (the "Shares") of the Company, and at the option price, all as hereinafter stated, such option to be exercisable not more than ten (10) years after the date hereof; and WHEREAS, the Eligible Director is willing to accept said option and to be bound by the terms and conditions thereof; and WHEREAS, the execution and delivery of this Agreement has been duly authorized by the Board of Directors of the Company; NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants herein contained and other good and valuable considerations, the receipt whereof is hereby acknowledged, the parties hereto, including to be legally bound hereby, agree as follows: GRANT OF OPTION: ADJUSTMENT OF SHARES COVERED BY OPTION 1.1 The Company hereby grants to the Eligible Director an option to purchase from the Company, upon the terms and conditions hereinafter set forth, 1,200 shares of Class B Common Stock, par value $.10 per share (the "Shares"), for a cash consideration of $2.80 per share. 1.2 The number of Shares above stated, and the purchase price thereof, may be subject to adjustment from time to time as provided herein. VESTING 2.1 This option shall vest and become nonforfeitable on the day of the Annual Meeting following the date hereof if the Eligible Director continues to serve as a Director. PAYMENTS FOR SHARES 3.1 The option price of the shares to be purchased pursuant to each exercise of the within option shall be paid to the Company by the Eligible Director in full in cash or by bank certified, cashier's or personal check at the time of exercise of the option. 2 EXERCISE OF OPTION 4.1 The within option may be exercised according to the following schedule: 4.1.1 Fifty (50%) percent of the options granted become exercisable on the date of the first Annual Meeting after the date hereof. 4.1.2 The remaining fifty (50%) percent of the options granted become exercisable on the date of the second Annual Meeting after the date hereof. TERM OF OPTION 5.1 The options granted shall expire ten years from the date hereof, but are subject to earlier termination as follows: 5.1.1 In the event of the termination of the optionee's service as a Director, other than by reason of retirement, total and permanent disability, or death, the options granted herein that have not been exercised shall automatically expire on the effective date of termination. 5.1.2 In the event of termination of the optionee by reason of retirement or total and permanent disability, all vested options shall become exercisable to the full extent of the number of Shares remaining then outstanding, regardless of whether such options were previously exercisable and each such option shall expire four years after the date of such termination or on the stated grant expiration date whichever is earlier. 5.1.3 In the event of the death of the optionee while he is still a Director, vested options as per Section 2.1 hereof shall become exercisable, to the full extent of Shares remaining covered by such options, regardless of whether such options were previously exercisable and each such option shall expire four years after the date of death of such optionee or on the stated grant expiration, whichever is earlier. RESTRICTIONS ON EXERCISE OF OPTION AND SALE OF STOCK BY ELIGIBLE DIRECTOR 6.1 The within option shall not be exercisable if: (a) The exercise thereof will involve a violation of any applicable federal or state securities law; or (b) The exercise thereof will require registration under the Securities Act of 1933, as amended, of the shares of stock or other securities of the Company to be purchased by the Eligible Director pursuant to such exercise. 6.2 The Company hereby agrees to make such reasonable efforts to comply with any applicable state securities law as the Committee of the Company shall determine are reasonably necessary but such efforts shall not subject the Company to unreasonable expense or hardship. 6.3 At the time of any exercise of the within option, the Eligible Director shall represent to and agree with the Company in writing that he is acquiring the shares in respect of which the option is being exercised for the purpose of investment and not with a view of distribution. 6.4 The Eligible Director agrees that he will not sell or otherwise dispose of any shares of stock or other securities of the Company purchased by him pursuant to the exercise of all or any portion of the within option at any -2- 3 time unless there is an effective Registration Statement in respect of such shares or other securities under the provisions of the Securities Act of 1933, as amended, or counsel for the Company is reasonably satisfied that an exemption from such registration provisions is available to the Company and the Eligible Director. MISCELLANEOUS 7.1 This Agreement shall be binding upon and inure to the benefit of the Company and its successors and the Eligible Director and his executors, administrators or personal representatives provided that the within option shall be non-transferable by the Eligible Director otherwise than by will or by the laws of descent and distribution, and during the lifetime of the Eligible Director the option shall be exercisable only by him. 7.2 In the event there are any changes in the capitalization of the Company through merger, consolidation, recapitalization, stock dividend or other change in the corporate or capital structure of the Company, appropriate adjustments, as may seem equitable to the Committee shall be made in the number of shares and the exercise price per share of the options to prevent dilution of the rights granted hereunder. 7.3 This Agreement shall be deemed to be made under and shall be construed in accordance with the laws of the State of Florida. 7.4 This Agreement shall become effective as of the date hereof and, unless sooner terminated, shall remain in effect for a period of ten (10) years from the date hereof. This Agreement may be terminated at any time by mutual consent of the parties hereto, but no modification or amendment of this Agreement shall become effective until such modification or amendment shall have been approved by the Committee. IN WITNESS WHEREOF, the Company has caused this Stock Option Agreement to be executed by its President or Vice President and the Eligible Director has executed this Agreement, the day and year first above written. ORIOLE HOMES CORP. --------------------------- Richard D. Levy Chief Executive Officer --------------------------- Paul R. Lehrer, Director -3- EX-10.38 4 g71225ex10-38.txt STOCK OPTION AGREEMENT WITH GEORGE RICHARDS 1 EXHIBIT 10.38 STOCK OPTION AGREEMENT FOR NONEMPLOYEE DIRECTORS AGREEMENT dated this 10th day of May, 2001, between Oriole Homes Corp., a Florida corporation (hereinafter called the "Company"), and George R. Richards (hereinafter called the "Eligible Director"). W I T N E S S E T H: WHEREAS, the Company's shareholders approved (on May 9, 1994) the adoption of the 1994 Stock Option Plan for Nonemployee Directors (the "Plan") pursuant to which each Eligible Director is entitled to receive a grant to purchase 1,200 Shares per year, up to a maximum of 6,000 Shares: WHEREAS, the Company's Board of Directors approved (on May 12, 1999) the adjustment of the maximum Shares pursuant to Article 7 of the 1994 Stock Option Plan for Nonemployee Directors (the "Plan") each Eligible Director is now entitled to a maximum of 12,000 Shares: WHEREAS, the Executive Committee of the Board of Directors of the Company (the "Committee") has this day granted to each Eligible Director an option to purchase 1,200 shares of Class B Common Stock, par value $.10 per share, (the "Shares") of the Company, and at the option price, all as hereinafter stated, such option to be exercisable not more than ten (10) years after the date hereof; and WHEREAS, the Eligible Director is willing to accept said option and to be bound by the terms and conditions thereof; and WHEREAS, the execution and delivery of this Agreement has been duly authorized by the Board of Directors of the Company; NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants herein contained and other good and valuable considerations, the receipt whereof is hereby acknowledged, the parties hereto, including to be legally bound hereby, agree as follows: GRANT OF OPTION: ADJUSTMENT OF SHARES COVERED BY OPTION 1.1 The Company hereby grants to the Eligible Director an option to purchase from the Company, upon the terms and conditions hereinafter set forth, 1,200 shares of Class B Common Stock, par value $.10 per share (the "Shares"), for a cash consideration of $2.80 per share. 1.2 The number of Shares above stated, and the purchase price thereof, may be subject to adjustment from time to time as provided herein. VESTING 2.1 This option shall vest and become nonforfeitable on the day of the Annual Meeting following the date hereof if the Eligible Director continues to serve as a Director. PAYMENTS FOR SHARES 3.1 The option price of the shares to be purchased pursuant to each exercise of the within option shall be paid to the Company by the Eligible Director in full in cash or by bank certified, cashier's or personal check at the time of exercise of the option. 2 EXERCISE OF OPTION 4.1 The within option may be exercised according to the following schedule: 4.1.1 Fifty (50%) percent of the options granted become exercisable on the date of the first Annual Meeting after the date hereof. 4.1.2 The remaining fifty (50%) percent of the options granted become exercisable on the date of the second Annual Meeting after the date hereof. TERM OF OPTION 5.1 The options granted shall expire ten years from the date hereof, but are subject to earlier termination as follows: 5.1.1 In the event of the termination of the optionee's service as a Director, other than by reason of retirement, total and permanent disability, or death, the options granted herein that have not been exercised shall automatically expire on the effective date of termination. 5.1.2 In the event of termination of the optionee by reason of retirement or total and permanent disability, all vested options shall become exercisable to the full extent of the number of Shares remaining then outstanding, regardless of whether such options were previously exercisable and each such option shall expire four years after the date of such termination or on the stated grant expiration date whichever is earlier. 5.1.3 In the event of the death of the optionee while he is still a Director, vested options as per Section 2.1 hereof shall become exercisable, to the full extent of Shares remaining covered by such options, regardless of whether such options were previously exercisable and each such option shall expire four years after the date of death of such optionee or on the stated grant expiration, whichever is earlier. RESTRICTIONS ON EXERCISE OF OPTION AND SALE OF STOCK BY ELIGIBLE DIRECTOR 6.1 The within option shall not be exercisable if: (a) The exercise thereof will involve a violation of any applicable federal or state securities law; or (b) The exercise thereof will require registration under the Securities Act of 1933, as amended, of the shares of stock or other securities of the Company to be purchased by the Eligible Director pursuant to such exercise. 6.2 The Company hereby agrees to make such reasonable efforts to comply with any applicable state securities law as the Committee of the Company shall determine are reasonably necessary but such efforts shall not subject the Company to unreasonable expense or hardship. 6.3 At the time of any exercise of the within option, the Eligible Director shall represent to and agree with the Company in writing that he is acquiring the shares in respect of which the option is being exercised for the purpose of investment and not with a view of distribution. 6.4 The Eligible Director agrees that he will not sell or otherwise dispose of any shares of stock or other securities of the Company purchased by him pursuant to the exercise of all or any portion of the within option at any time unless there is an effective Registration Statement in respect of such -2- 3 shares or other securities under the provisions of the Securities Act of 1933, as amended, or counsel for the Company is reasonably satisfied that an exemption from such registration provisions is available to the Company and the Eligible Director. MISCELLANEOUS 7.1 This Agreement shall be binding upon and inure to the benefit of the Company and its successors and the Eligible Director and his executors, administrators or personal representatives provided that the within option shall be non-transferable by the Eligible Director otherwise than by will or by the laws of descent and distribution, and during the lifetime of the Eligible Director the option shall be exercisable only by him. 7.2 In the event there are any changes in the capitalization of the Company through merger, consolidation, recapitalization, stock dividend or other change in the corporate or capital structure of the Company, appropriate adjustments, as may seem equitable to the Committee shall be made in the number of shares and the exercise price per share of the options to prevent dilution of the rights granted hereunder. 7.3 This Agreement shall be deemed to be made under and shall be construed in accordance with the laws of the State of Florida. 7.4 This Agreement shall become effective as of the date hereof and, unless sooner terminated, shall remain in effect for a period of ten (10) years from the date hereof. This Agreement may be terminated at any time by mutual consent of the parties hereto, but no modification or amendment of this Agreement shall become effective until such modification or amendment shall have been approved by the Committee. IN WITNESS WHEREOF, the Company has caused this Stock Option Agreement to be executed by its President or Vice President and the Eligible Director has executed this Agreement, the day and year first above written. ORIOLE HOMES CORP. ---------------------------- Richard D. Levy Chief Executive Officer ---------------------------- George R. Richards, Director -3- -----END PRIVACY-ENHANCED MESSAGE-----