LAND, ORCHARDS AND EQUIPMENT

12 Months Ended

Dec. 31, 2012

(6) LAND, ORCHARDS AND EQUIPMENT

Land, orchards and equipment, stated at cost, consisted of the following at December 31, 2012 and 2011

(000’s):	2012		2011
Land	$	9,884	$	9,884
Improvements	1,980		1,953
Machinery and equipment	5,527		5,245
Irrigation well and equipment	2,592		2,592
Producing orchards	76,325		76,317
Construction work-in-progress	103		—
Land, orchards and equipment (gross)	96,411		95,991
Less accumulated depreciation and amortization	48,384		45,982
Land, orchards and equipment (net)	$	48,027	$	50,009

Depreciation expense was recorded for $2.4 million, $2.4 million, and $2.2 million in 2012, 2011 and 2010, respectively. The Partnership’s interest in trees situated on certain leased macadamia orchard properties are subject to repurchase at the option of the lessors. Such repurchase options grant the lessors the right to purchase all or a portion of these trees after June 30, 2019, at fair market value, as defined in the respective farming lease agreements. If the repurchase options are not exercised prior to expiration of the lease agreements and the lessors do not offer to extend the lease agreements at the then current market lease rates, the lessors are required to repurchase these trees at fair market value at lease expiration. The lessors will be released from their repurchase obligation in the event that the Partnership declines to accept an extension offer from the lessors at fair market lease rates.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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