-----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, BT+Tw+1y9Ba/P6EI0wqFtHUfboNilOgVKlXw6coHh3ro7T6QmSa+Uq9dv1zcP3vm uQ91vlmDn5rWZVdqtcwrqw== 0000832813-01-000002.txt : 20010223 0000832813-01-000002.hdr.sgml : 20010223 ACCESSION NUMBER: 0000832813-01-000002 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010215 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EXCAL ENTERPRISES INC CENTRAL INDEX KEY: 0000832813 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF NONRESIDENTIAL BUILDINGS [6512] IRS NUMBER: 592855398 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-17069 FILM NUMBER: 1546677 BUSINESS ADDRESS: STREET 1: 100 N TAMPA ST STREET 2: STE 3575 CITY: TAMPA STATE: FL ZIP: 33602 BUSINESS PHONE: 8132240228 MAIL ADDRESS: STREET 1: 100 NORTH TAMPA ST SUITE 3575 STREET 2: 100 NORTH TAMPA ST SUITE 3575 CITY: TAMPA STATE: FL ZIP: 33602 FORMER COMPANY: FORMER CONFORMED NAME: ASSIX INTERNATIONAL INC DATE OF NAME CHANGE: 19920703 10QSB 1 0001.txt U. S. SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2000 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from ____________ to ______________ Commission File No. 0-17069 Excal Enterprises, Inc. --------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) Delaware 59-2855398 - ------------------------------- ---------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 100 North Tampa Street, Suite 3575, Tampa, Florida 33602 -------------------------------------------------------- (Address of principal executive offices) (813) 224-0228 ------------------------- Issuer's telephone number --------------------------------------------------- (Former Name, former address and former fiscal year, if changed since last report) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15 (d) of the Exchange Act during the past 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. [X] Yes [ ] No As of January 31, 2001, there were 3,290,877 shares of the issuer's common stock, par value $0.001, outstanding. Transitional Small Business Disclosure Format (Check One): [ ] Yes [X] No PART I - FINANCIAL INFORMATION Item 1. Financial Statements. EXCAL ENTERPRISES, INC. CONSOLIDATED BALANCE SHEET DECEMBER 31, 2000 ASSETS (unaudited) Current Assets Cash and cash equivalents $ 3,727,410 Marketable securities 48,880 Accounts receivable, less allowance of $151,595 1,359,403 Notes receivable 310,736 Income tax receivable 181,000 Inventory 800,893 Prepaid expenses and deposits 376,878 Deferred tax asset 107,000 ---------- Total current assets 6,912,200 Property, plant and equipment Land 1,600,000 Buildings and improvements 7,309,085 Furniture, fixtures, vehicles and equipment 2,263,498 ---------- 11,172,583 Less accumulated depreciation and amortization 2,464,547 ---------- Net property, plant and equipment 8,708,036 ---------- Note receivable - related parties 961,115 Restricted cash reserves 648,941 Commission costs, less accumulated amortization of $413,081 243,384 Loan costs, less accumulated amortization of $541,440 291,544 ---------- Total Assets $ 17,765,220 ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 791,148 Accrued liabilities 210,915 Reserve for litigation 334,246 Revolving line of credit 373,087 Current portion of long-term debt 473,589 ---------- Total current liabilities 2,182,985 Long-term debt 12,910,847 Deferred tax liability 1,313,000 ---------- Total liabilities 16,406,832 ---------- Minority interest equity 1,041 Stockholders' equity Preferred stock, $.01 par value, 7,500,000 shares authorized, 5,000,000 shares issued, no shares outstanding -- Common stock, $.001 par value, 20,000,000 shares authorized, 4,738,866 shares issued, 3,290,877 shares outstanding 4,738 Additional paid-in capital 3,985,842 Retained earnings 2,251,782 Less 1,447,989 shares of common stock held in treasury at cost ( 3,767,385) ---------- 2,474,977 Less notes receivable from stockholders ( 1,117,630) ---------- Total stockholders' equity 1,357,347 ---------- Total Liabilities and Stockholders' Equity $ 17,765,220 ========== The accompanying notes are an integral part of the consolidated financial statements. EXCAL ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Three months ended Nine months ended December 31 December 31 ------------------------- ------------------------- 2000 1999 2000 1999 --------- --------- --------- --------- Rental revenue $ 1,282,569 $ 1,228,313 $ 3,837,531 $ 3,791,632 Sports licensing sales 1,476,501 1,091,482 2,809,773 2,189,899 --------- --------- --------- --------- Total net revenue 2,759,070 2,319,795 6,647,304 5,981,531 Cost of sports licensing sales 1,225,433 740,990 2,302,802 1,601,686 --------- --------- --------- --------- Gross margin 1,533,637 1,578,805 4,344,502 4,379,845 --------- --------- --------- --------- Rental operating costs 585,512 454,330 1,714,384 1,702,414 Sports licensing operating costs 707,358 429,718 1,717,515 1,183,891 Depreciation and amortization 158,662 159,260 468,487 486,046 --------- --------- --------- --------- Total operating costs 1,451,532 1,043,308 3,900,386 3,372,351 --------- --------- --------- --------- Net operating profit 82,105 535,497 444,116 1,007,494 --------- --------- --------- --------- Other expense (income) Interest expense 312,881 317,329 947,126 960,016 Professional fees related to litigation 142,125 95,787 224,662 212,958 Litigation settlement ( 100,000) -- ( 100,000) 2,000 Net realized and unrealized loss on marketable securities 24,557 -- 346,430 -- Gain on disposals of assets ( 6,819) -- ( 8,560) -- Interest income ( 117,037) ( 140,890) ( 392,251) ( 423,813) Miscellaneous income ( 23,657) ( 31,761) ( 48,817) ( 64,304) --------- --------- --------- --------- Net other expense 232,050 240,465 968,590 686,857 --------- --------- --------- --------- Income (loss) before income taxes ( 149,945) 295,032 ( 524,474) 320,637 Income tax provision 205,000 312,000 258,000 467,000 --------- --------- --------- --------- Net loss $( 354,945) $( 16,968) $( 782,474) $( 146,363) ========= ========= ========= ========= Loss per share Basic $( .09) $ -- $( .20) $( .04) ========= ========= ========= ========= Diluted $( .09) $ -- $( .20) $( .04) ========= ========= ========= ========= Weighted average shares outstanding Common 3,852,448 3,951,725 3,866,852 4,171,904 Common and equivalent 3,852,448 3,951,725 3,866,852 4,171,904 The accompanying notes are an integral part of the consolidated financial statements.
EXCAL ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) Nine months ended December 31 ----------------------------- 2000 1999 --------- --------- Cash provided by operating activities Net loss $( 782,474) $( 146,363) Adjustments to reconcile net loss to net cash provided (used) by operating activities: Depreciation and amortization 556,800 572,184 Other adjustments 286,264 409,739 Decrease (increase) in net operating assets ( 1,386,636) ( 499,176) --------- --------- Net cash provided (used) by operating activities ( 1,326,046) 336,384 --------- --------- Cash flows from investing activities Proceeds from sale of assets 35,000 -- Property and equipment additions ( 562,666) ( 40,033) --------- --------- Net cash used by investing activities ( 527,666) ( 40,033) --------- --------- Cash flows from financing activities Loan to related party ( 650,000) ( 261,394) Principal repayments of long-term debt ( 192,208) ( 122,311) Purchase of treasury stock ( 1,061,297) ( 1,713,368) --------- --------- Net cash used by financing activities ( 1,903,505) ( 2,097,093) --------- --------- Decrease in cash ( 3,757,217) ( 1,800,722) --------- --------- Cash and cash equivalents at beginning of period 7,484,627 9,655,973 --------- --------- Cash and cash equivalents at end of period $ 3,727,410 $ 7,855,251 ========= ========= The accompanying notes are an integral part of the consolidated financial statements. EXCAL ENTERPRISES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) NOTE 1 - FINANCIAL STATEMENTS In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of (a) the results of operations for the three-month and nine-month periods ended December 31, 2000 and 1999, (b) the financial position at December 31, 2000, and (c) cash flows for the nine-month periods ended December 31, 2000 and 1999, have been made. Certain reclassifications have been made to the financial statements for the three-month and nine-month periods ended December 31, 1999 to conform to the December 31, 2000 presentation. None of the reclassifications affected the financial position or results of operations. The unaudited consolidated financial statements and notes are presented as permitted by Form 10-QSB. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted. The accompanying consolidated financial statements and notes should be read in conjunction with the audited financial statements and notes of the Company for the fiscal year ended March 31, 2000. The revenue of the sports licensing division has been very seasonal with the majority of its revenue in the months of July through November. The results of operations for the three-month and nine-month periods ended December 31, 2000 are not necessarily indicative of those to be expected for the entire year. NOTE 2 - NOTES PAYABLE The Company's $375,000 line of credit with European American Bank expired on December 29, 2000. The extension was not renewed. In addition, Roxbury was in violation of the financial loan covenants regarding the level of equity and debt-to-equity ratio at December 31, 2000. The Company has been negotiating with European American Bank to develop a long-term extension of the line of credit. However, since no renewal has been signed and no waiver of the financial covenant violations has been received, the entire amount of the term loan is included in the current portion of long-term debt. NOTE 3 - STOCKHOLDERS' EQUITY During the nine months ended December 31, 2000, the Company purchased 600,800 shares of its common stock at an aggregate cost of $ 1,061,297. NOTE 4 - SEGMENT INFORMATION The Company has two reportable business segments. These segments have been determined by product line and consist of the rental of commercial real estate and the manufacture and distribution of sports licensing products. The revenue shown on the face of the financial statements was from external sources. The segment information disclosures not included on the face of the financial statements are detailed in the tables below. The "Other" category includes corporate related items and income and expense items not allocated to reportable segments. Three months ended Nine months ended December 31 December 31 ---------------------- ------------------------ 2000 1999 2000 1999 ------- ------- --------- ------- Segment income (loss) before income taxes Real estate operations $ 345,853 $ 425,031 $ 1,092,393 $ 967,746 Sports licensing operations ( 529,216) ( 107,018) ( 1,389,805) ( 684,125) Other 33,418 ( 22,981) ( 227,062) 37,016 ------- ------- --------- ------- Total income (loss) before income taxes $( 149,945) $ 295,032 $( 524,474) $ 320,637 ======= ======= ========= ======= As of December 31 -------------------------- 2000 1999 ---------- ---------- Identifiable assets Real estate operations $ 12,674,041 $ 13,837,568 Sports licensing operations 2,850,064 2,232,836 Other 2,241,115 4,740,551 ---------- ---------- Total identifiable assets $ 17,765,220 $ 20,810,955 ========== ========== Item 2. Management's Discussion and Analysis. Except for historical matters, the matters discussed in this Form 10-QSB are forward-looking statements based on current expectations. Forward-looking statements, including without limitation, statements relating to the Company's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including without limitation the following: (i) the Company's plans, strategies, objectives, expectations and intentions are subject to change at any time at the discretion of the Company, (ii) the Company's plans and results of operations will be affected by economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services, and prices; and (iii) other risks and uncertainties as indicated from time to time in the Company's filings with the Securities and Exchange Commission. The following discussion should be read in conjunction with the information contained in the financial statements of the Company and the notes thereto appearing elsewhere herein and in conjunction with Management's Discussion and Analysis set forth in the Company's Form 10-KSB for the fiscal year ended March 31, 2000. The following discussion compares the results of operations for the three- month period ended December 31, 2000 (Third Quarter 2001) with the three-month period ended December 31, 1999 (Third Quarter 2000) and for the nine-month period ended December 31, 2000 (2001 YTD) with the nine-month period ended December 31, 1999 (2000 YTD). Results of Continuing Operations The Company's operations fall into two distinct businesses: the manufacture and distribution of sports licensing products and the rental of commercial real estate. Roxbury Industries Corp. ("Roxbury") produces and distributes knit products licensed by most professional and major college teams. The Company owns, leases, and manages a two-story warehouse and office facility containing approximately 1,666,000 square feet of rentable space located on approximately 74 acres in an industrial park in Duval County, Florida. Sports Licensing Products Roxbury's revenue has been very seasonal with the majority of its sales in the months of July through November. Revenue increased by 35% in Third Quarter 2001 and 28% for 2001 YTD as compared to the same periods of the prior year. The majority of the revenue increase was in the 4.0T product line which increased by 75% in Third Quarter 2001 and 65% for 2001 YTD. Private label revenue increased by 1% in Third Quarter 2001 and 19% for 2001 YTD. These two product lines accounted for 88% of total revenue in 2001 YTD as compared to 79% in 2000 YTD. The sales orders booked in Third Quarter 2001 were 52% over Third Quarter 2000 and 46% higher in 2001 YTD as compared to 2000 YTD. These increases were the result of a 60% and 82% increase in 4.0T sales orders for Third Quarter 2001 and 2001 YTD, respectively. Increased sales in the 4.0T product line has been the major focus of the Company's marketing efforts this season, especially with the addition of the NFL license for headwear. Sales orders for private label were up 42% for 2001 YTD as compared to 2000 YTD. After evaluating operating costs and gross margins, the Company decided to sell its screen printing operation. The operation closed in June 2000 and the equipment was sold. Screen printing operations only accounted for $160,000 in revenue in the last fiscal year and $44,000 in revenue for 2001 YTD. The cost of goods sold increased in Third Quarter 2001 and 2001 YTD as a result of the increased revenue. The cost of goods sold, as a percentage of revenue, is higher for Third Quarter 2001 (83%) and 2001 YTD (81%) than for Third Quarter 2000 (68%) and 2000 YTD (73%). The increase is due to costs associated with changes in the manufacturing processes that were implemented in Second Quarter 2001 and Third Quarter 2001 that resulted in increased labor costs. It is anticipated that these changes will reduce future manufacturing labor costs, as a percentage revenue, and increase production capacity. As licensed product revenue (4.0T) becomes a larger percentage of total revenue, the gross margin is expected to increase. The operating costs of Roxbury increased by 65% in the Third Quarter 2001 as compared to Third Quarter 2000 and by 45% for 2001 YTD as compared to 2000 YTD. This increase is due to increased expenditures on market research and various marketing programs and the addition of personnel in sales, sales support, operations, customer service and design. In addition, overhead costs are allocated based on revenues of the divisions. Therefore, as revenue has increased, so has the allocation of overhead. Depreciation and amortization included in operating costs and cost of goods sold decreased slightly in Third Quarter 2001 and 2001 YTD as compared to Third Quarter 2000 and 2000 YTD. The net operating loss of the sports licensing division increased from $86,087 in Third Quarter 2000 to $465,759 in Third Quarter 2001 and from $618,483 in 2000 YTD to $1,233,592 in 2001 YTD. The increased loss was the result of the increased operating costs. Commercial Real Estate The commercial real estate operations consist of the lease and management of property located in Jacksonville, Florida (Imeson Center). The property consists of approximately 1,392,000 square feet of warehouse space and 274,000 square feet of office space. The Company's lease agreements are structured to include a base minimum rental fee, a contingent rental fee to reimburse the Company for operating expenses, common area maintenance costs, insurance and property taxes, and a requirement that the tenant pay for its own utilities. In Second Quarter 2001, the Company received notification from Laney & Duke that they would not be renewing their leases for 1,392,000 square feet of warehouse space. The lease of warehouse space to Laney & Duke expired on December 31, 2000. However, Laney & Duke has signed a one-year extension of the lease covering 1,003,660 square feet of warehouse space. The Company is marketing the space currently available. Net revenue increased by 5% to $1,282,569 in Third Quarter 2001 from $1,228,313 in Third Quarter 2000 and increased to $3,837,531 in 2001 YTD from $3,791,632 in 2000 YTD. The base minimum rental fee increased by $34,230 (3%) in Third Quarter 2001 and by $111,712 (4%) in 2001 YTD as a result of increases in the base minimum rent per square foot. The contingent rental fee increased slightly by $20,026 (9%) in Third Quarter 2001 and decreased by $65,813 (8%) in 2001 YTD as a result of decreases in reimbursable operating costs. Operating costs increased by $131,182 (29%) to $585,512 in Third Quarter 2001 from $454,330 in Third Quarter 2000. Operating costs increased by $11,970 in 2001 YTD as compared to 2000 YTD. These increases were primarily the result of increases in professional fees and marketing costs related to the available warehouse space. Depreciation and amortization decreased slightly in Third Quarter 2001 to $158,662, and decreased by 4% in 2001 YTD to $468,467 as compared to the same periods of the prior year. The net operating profit of the commercial real estate division decreased from $621,764 in Third Quarter 2000 to $547,864 in Third Quarter 2001. The net operating profit for 2001 YTD was $1,677,708, compared to $1,625,977 for 2000 YTD. Consolidated Operating Results Revenue increased $439,275 (19%) to $2,759,070 for Third Quarter 2001 and increased 11% to $6,647,304 in 2001 YTD as compared to the same periods of the last fiscal year. The increase was primarily due to increased revenues in the sports licensing division. The cost of goods sold increased as a result of the sports licensing division revenue increases. Operating costs increased by 39% to $1,451,532 in Third Quarter 2001 from $1,043,308 in Third Quarter 2000. The increase was related to the increase in marketing costs of the commercial real estate division and by travel, professional fees, and additional sales and marketing expenditures in the sports licensing division. Operating costs increased to $3,900,386 in 2001 YTD as compared to $3,372,351 in 2000 YTD. The increase was primarily in the sports licensing operating costs on a year-to-date basis. The net operating profit declined $453,392 in Third Quarter 2001 to $82,105, as compared to $535,497 in Third Quarter 2000. The net operating profit for 2001 YTD declined $563,378 to $444,116 as compared to $1,007,494 for 2000 YTD. Other Expense (Income) Beginning in the fourth quarter of fiscal 2000, the Company invested excess reserves in publicly traded equity securities. The Company incurred a loss of $24,557 in Third Quarter 2001 and $346,430 in 2001 YTD from these investments. In the fourth quarter of fiscal 1994, the Company recorded a reserve of $350,000 for the Securities and Exchange Commission litigation. In January 2001, the Company settled with the Securities and Exchange Commission without penalty. The reserve was decreased by $100,000 to $250,000. This remaining balance of the reserve represents the Company's obligation to indemnify its officers who were assessed penalties. An income tax provision was recorded in Third Quarter 2001 and 2001 YTD despite having a consolidated loss before income taxes. Also, the income tax provision for Third Quarter 2000 was in excess of income before taxes. These anomalies occurred for two reasons. First, Roxbury files separate income tax returns and the tax benefits from its losses were not recognized. The benefit from these losses will be recognized when Roxbury generates pretax income. Second, the losses on the investment in equity securities are capital losses and can only be deducted to the extent there are capital gains. Therefore, no tax benefit was recorded from these losses. Liquidity and Capital Resources The cash used by operating activities was $1,326,046 in 2001 YTD compared to cash provided of $336,384 in 2000 YTD. The Company's operations provided $60,590 in working capital in 2001 YTD compared to $835,560 of working capital provided in 2000 YTD. The increase in net operating assets for 2001 YTD was primarily from an increase in the accounts receivable and inventory in the sports licensing division and an increase in accounts receivable and prepaid property taxes in the real estate division. The increase in net operating assets for 2000 YTD was the result of an increase in sports licensing accounts receivable and commercial real estate prepaid expenses, offset by an increase in accounts payable and accrued expenses. Property and equipment additions consisted primarily of real estate investment in the commercial real estate division and equipment to be used in the future operations of the sports apparel and accessories product line in 2001 YTD and equipment used in the sports licensing division in 2000 YTD. Cash of $1,903,505 was used by financing activities in 2001 YTD, as compared to cash used by financing activities of $2,097,093 in 2000 YTD. The decrease in cash used by financing activities was related to a reduction in the purchase of its common stock by the Company in 2001 YTD as compared to 2000 YTD. The company loaned a director $650,000 primarily to pay income taxes, penalty, and interest. The amount is shown as a loan to related party. The Company did not have any material commitments for capital expenditures as of December 31, 2000 other than for ordinary expenses incurred during the usual course of business. Laney & Duke has signed a one-year extension on a majority of the warehouse space it had leased. They are not expected to extend the lease beyond the current December 31, 2001 termination date. This lessee accounted for the majority of the commercial rental revenue and non- renewal will have a significant impact on the Company's operating results and liquidity. The Company is looking for additional tenants for Imeson Center for the remaining 41,000 square feet of office space, the warehouse space currently available, the warehouse space occupied by Laney & Duke and the office space occupied by America Online. It is expected that any new tenant will require the Company to incur significant costs related to renovation of the property to meet the tenant's needs. Additionally, the Company is considering opportunities to develop outparcels at the Imeson Center. Roxbury is incurring additional marketing expenses to expand its revenue base and distribution channels. These expanded marketing activities may not generate the revenue projected and result in future losses. Although, the Company has not identified any specific opportunities at this time, the Company is expending resources to identify potential opportunities to expand the Company's business operations into other areas. Any new business operation will likely involve a substantial commitment of Company resources and a significant degree of risk. The Company also has potential liability related to litigation. In addition, the Company has been and expects to continue repurchasing shares of its stock. While the Company has a significant current liquidity position, any of the above mentioned items could require significant capital resources in excess of the Company's current liquidity position, requiring it to raise additional capital through public or private debt or equity financing. The availability of these capital sources will depend upon prevailing market conditions, interest rates, and the then existing financial position and results of operations of the Company. Therefore, no assurances can be made by the Company that such additional capital will be available. PART II - OTHER INFORMATION Item 1. - Legal Proceedings No material events have occurred in the Company's ongoing litigation matters other than those described below. For the history of such litigation, please refer to the Company's Annual Report on Form 10-KSB for the fiscal year ended March 31, 2000. Securities and Exchange Commission The Company settled its dispute with the Securities and Exchange Commission with no fines or penalties. The Company, without admitting or denying any wrongdoing, consented to a final judgment enjoining it from future violations of various sections of the federal securities laws. The Company chairman and former CEO also signed a consent decree neither admitting nor denying any wrongdoing, and agreed to pay $405,000 in penalties, disgorgement of profits, and prejudgment interest. Eisenberg Group The Company voluntarily dismissed the case without prejudice. ASX Investment Corporation On August 22, 2000, the United States District Court granted the Company's motion to dismiss Count I to the extent that ASX Investment Corporation is barred from asserting claims against the Company based on alleged violations of section 10(b) and Rule 10b-5 that ASX Investment Corporation discovered in April 1994. The Court denied the Company's motion to dismiss Counts II, III, and IV. The Company answered the amended complaint on September 6, 2000 denying the claims of ASX Investment Corporation. Harvey Moore The appellate court has upheld the majority of the District Court's ruling on reimbursement of legal fees. However, there were a few issues that the appellate court remanded back to the district court. Item 2. Exhibits and Reports on Form 8-K. (a) Exhibits None (b) Reports on Form 8-K. On January 26, 2001, the Company filed an 8-K announcing that Laney & Duke had signed a one-year lease extension covering 307,538 square feet of the first floor warehouse space and all 696,122 square feet of the second floor warehouse space at Imeson Center. (c) Sales of Unregistered Securities. None. SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. EXCAL ENTERPRISES, INC. ------------------------------------- Registrant Dated: February 14, 2001 /s/ W. CAREY WEBB ------------------------------------- W. Carey Webb President and Chief Executive Officer Dated: February 14, 2001 /s/ TIMOTHY R. BARNES ------------------------------------------ Timothy R. Barnes Vice President and Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----