Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 12, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | PGI INC | |
Entity Central Index Key | 81,157 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 5,317,758 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,016 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
ASSETS | ||
Cash | $ 1 | $ 1 |
Restricted cash | 5 | 5 |
Receivables-related party | 149 | 178 |
Land and improvement inventories | 639 | 639 |
Other assets | 46 | 44 |
Total Assets | 840 | 867 |
LIABILITIES | ||
Accounts payable and accrued expenses | 216 | 202 |
Accrued real estate taxes | 2 | 8 |
Accrued interest: | ||
Primary lender-related party | 460 | 450 |
Subordinated convertible debentures payable | 22,796 | 22,484 |
Accrued Interest Debentures-Related Party | 56,520 | 54,558 |
Notes payable | 3,098 | 3,081 |
Credit agreements: | ||
Primary lender-related party | 500 | 500 |
Notes payable | 1,198 | 1,198 |
Subordinated Convertible Debentures Payable | 8,472 | 8,472 |
Convertible Debt-Related Party | 1,500 | 1,500 |
Liabilities Total | 94,762 | 92,453 |
STOCKHOLDERS' DEFICIENCY | ||
Preferred stock, par value $1.00 per share; authorized 5,000,000 shares; 2,000,000 Class A cumulative convertible shares issued and outstanding; (liquidation preference of $8,000 and cumulative dividends) | 2,000 | 2,000 |
Common stock, par value $.10 per share; authorized 25,000,000 shares; 5,317,758 shares issued and outstanding | 532 | 532 |
Paid-in capital | 13,498 | 13,498 |
Accumulated deficit | (109,952) | (107,616) |
Total stockholders' deficiency | (93,922) | (91,586) |
Total liabilities and stockholders' deficiency | $ 840 | $ 867 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
STOCKHOLDERS' DEFICIENCY | ||
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, liquidation preference (excluding cumulative dividends) | $ 8,000 | $ 8,000 |
Preferred stock - Class A cumulative convertible shares, issued | 2,000,000 | 2,000,000 |
Preferred stock - Class A cumulative convertible shares, outstanding | 2,000,000 | 2,000,000 |
Common stock, par value | $ .10 | $ .10 |
Common stock, authorized | 25,000,000 | 25,000,000 |
Common stock, issued | 5,317,758 | 5,317,758 |
Common stock, outstanding | 5,317,758 | 5,317,758 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
REVENUES | ||
Interest income-related party | $ 1 | $ 3 |
Total Revenues | 1 | 3 |
COSTS, EXPENSES AND OTHER | ||
Interest | 328 | 320 |
Forgiveness of debt and interest | 0 | (185) |
Interest-related party | 1,973 | 1,720 |
Taxes and assessments | 2 | 3 |
Consulting and accounting-related party | 9 | 9 |
Legal and professional | 5 | 4 |
General and administrative | 20 | 19 |
Total costs and expenses | 2,337 | 1,890 |
NET LOSS | $ (2,336) | $ (1,887) |
NET LOSS PER SHARE(*) AVAILABLE TO COMMON STOCKHOLDERS-Basic and diluted | $ (0.47) | $ (0.38) |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Cash Flows [Abstract] | ||
Net cash used in operating activities | $ (29) | $ (27) |
Cash flows from investing activities: | ||
Proceeds from notes receivable-related party | 29 | 27 |
Net cash provided by investing activities | 29 | 27 |
Net change in cash | 0 | 0 |
Cash at beginning of period | 1 | 1 |
Cash at end of period | $ 1 | $ 1 |
1. Basis of Presentation
1. Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements of PGI Incorporated and its subsidiaries (the Company) have been prepared in accordance with the instructions to Form 10 - Q and therefore do not include all disclosures necessary for fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. The Company's independent registered public accounting firm included an explanatory paragraph regarding the Company's ability to continue as a going concern in their opinion on the Company's consolidated financial statements for the year ended December 31, 2015. Certain information and note disclosures normally included in the Companys annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Companys Form 10-K annual report for 2015 filed with the Securities and Exchange Commission. The condensed consolidated balance sheet of the Company as of December 31, 2015 has been derived from the audited consolidated balance sheet as of that date. The Company remains in default under the indentures governing its unsecured subordinated debentures and collateralized convertible debentures and is in default of its primary debt obligations. (See Management's Discussion and Analysis of Financial Condition and Results of Operations and Notes 7, 8, and 9 to the Company's consolidated financial statements for the year ended December 31, 2015, as contained in the Company's Annual Report on Form 10 - K). All adjustments (consisting of only normal recurring accruals) necessary for fair presentation of financial position, results of operations and cash flows have been made. The results for the three months ended March 31, 2016 are not necessarily indicative of operations to be expected for the fiscal year ending December 31, 2016 or any other interim period. |
2. Per Share Data
2. Per Share Data | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Per Share Data | Basic per share amounts are computed by dividing net income (loss), after considering current period dividends on the Company's preferred stock, by the average number of common shares. The average number of common shares outstanding for the three months ended March 31, 2016 and 2015 was 5,317,758. Diluted per share amounts are computed by dividing net income (loss) by the average number of common shares outstanding, after adjusting for the estimated effect of the assumed conversion of all cumulative convertible preferred stock and collateralized convertible debentures into shares of common stock. For the three months ended March 31, 2016 and 2015, the assumed conversion of all cumulative convertible preferred stock and collateralized convertible debentures would have been anti-dilutive. The following is a summary of the calculations used in computing basic and diluted loss per share for the three months ended March 31, 2016 and 2015. Three Months Ended March 31, March 31, 2016 2015 Net Loss $ (2,336,000 ) $ (1,887,000 ) Preferred dividends (160,000 ) (160,000 ) Loss Available to $ (2,496,000 ) $ (2,047,000 ) Common shareholders Weighted Average Number Of Common Shares Outstanding 5,317,758 5,317,758 Basic and Diluted Loss Per Share $ (0.47 ) $ (0.38 ) |
3. Statement of Cash Flows
3. Statement of Cash Flows | 3 Months Ended |
Mar. 31, 2016 | |
Statement of Cash Flows [Abstract] | |
Statement of Cash Flows | The Financial Accounting Standards Board Accounting Standards Codification Topic No. 230, Statement of Cash Flows, requires a statement of cash flows as part of a full set of financial statements. For quarterly reporting purposes, the Company has elected to condense the reporting of its net cash flows. There were no payments of interest for the three month periods ended March 31, 2016 and March 31, 2015. |
4. Restricted Cash
4. Restricted Cash | 3 Months Ended |
Mar. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Restricted Cash | Restricted cash includes restricted proceeds held by PGIP, LLC, the primary lender, as collateral for debt repayment. |
5. Receivables
5. Receivables | 3 Months Ended |
Mar. 31, 2016 | |
Receivables [Abstract] | |
Receivables | Net receivables consisted of: March 31, December 31, 2016 2015 ($ in thousands) Notes receivable - related party $ 149 $ 178 |
6. Land and Improvements
6. Land and Improvements | 3 Months Ended |
Mar. 31, 2016 | |
Real Estate [Abstract] | |
Land and Improvements | Land and improvement inventories consisted of: March 31, December 31, 2016 2015 ($ in thousands) Unimproved land $ 625 $ 625 Fully improved land 14 14 $ 639 $ 639 |
7. Other Assets
7. Other Assets | 3 Months Ended |
Mar. 31, 2016 | |
Other Assets [Abstract] | |
Other Assets | Other assets consisted of: March 31, December 31, 2016 2015 ($ in thousands) Deposit with Trustee of 6-1/2% debentures $ 41 $ 41 Prepaid expenses 1 2 Other 4 1 $ 46 $ 44 |
8. Accounts Payable and Accrued
8. Accounts Payable and Accrued Expenses | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of: March 31, December 31, 2016 2015 ($ in thousands) Accounts payable $ 18 $ 7 Accrued audit & professional 36 40 Accrued legal 5 - Accrued consulting fees-related party 1 1 Environmental remediation obligations 25 25 Accrued debenture fees 130 128 Accrued miscellaneous 1 1 $ 216 $ 202 Accrued real estate taxes consisted of: Current real estate taxes $ 2 $ 8 |
9. Primary Lender Credit Agreem
9. Primary Lender Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable | 3 Months Ended |
Mar. 31, 2016 | |
Primary Lender Credit Agreements Notes Payable Subordinated And Convertible Debentures Payable | |
Primary Lender Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable | Credit agreements with the Companys primary lender and notes payable consisted of the following: March 31, December 31, 2016 2015 ($ in thousands) Credit agreements - primary lender-related party balance is past due, bearing interest at prime plus 5%; due June 1, 1997 $ 500 $ 500 Notes payable - $1,176,000 bearing interest at prime plus 2%, the remainder non-interest bearing, all past due 1,198 1,198 1,698 1,698 Subordinated debentures payable: At 6-1/2% interest; due June 1, 1991 447 447 At 6% interest; due May 1, 1992 8,025 8,025 8,472 8,472 Collateralized convertible debentures payable-related party: At 14% interest; due July 8, 1997, convertible into shares of common stock at $1.72 per share 1,500 1,500 $ 11,670 $ 11,670 The Trustee of the 6.5% subordinated convertible debentures, which matured in June, 1991, with an original face amount of $1,034,000, provided notice of final distribution to holders of such debentures on September 2, 2014. In connection with such final distributions, the Trustee has maintained a debenture reserve fund with a balance of $41,000 as of March 31, 2016 and December 31, 2015, respectively, available for final distribution to holders of such debentures who surrender their respective debenture certificates. During the three month period ended March 31, 2016, there were no subordinated convertible debentures that were surrendered by their respective debenture holders and no funds were utilized from the debenture reserve account. During the year ended December 31, 2015, such subordinated convertible debentures with face amounts of $80,000 have been surrendered by their respective debenture holders. Funds utilized from the debenture reserve account were $7,000 during the year ended December 31, 2015 in payment of a final distribution to such debenture holders. Accordingly, the Company has recognized $73,000 in forgiveness of debt during the year ended December 31, 2015. In addition, accrued interest in the amount of $136,000 on such debentures that have been surrendered was recorded as forgiveness of interest expense during the year ended December 31, 2015. As of March 31, 2016 and December 31, 2015 the outstanding principal balance on such 6.5% subordinated convertible debentures that were not surrendered by the respective holders equals $447,000 plus accrued and unpaid interest of $795,000 and $788,000, respectively. If and when such remaining debentures are surrendered to the Trustee, the applicable portion of such principal and accrued interest will similarly be recorded as debt and accrued interest forgiveness. As the Company has consistently stated in prior filings, the Company believes that any potential claims by the respective debenture holders on such 6.5% subordinated convertible debentures would be barred under the applicable statutes of limitations. |
10. Income Taxes
10. Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | At December 31, 2015, the Company had an operating loss carryforward of approximately $69,321,000 available to reduce future taxable income. These operating losses expire at various dates through 2035. The following summarizes the temporary differences of the Company at March 31, 2016 and December 31, 2015 at the statutory rate: March 31, December 31, 2016 2015 ($ in thousands) Deferred tax asset Net operating loss carryforward $ 27,230 $ 26,342 Adjustments to reduce land to net realizable value 12 12 Expenses capitalized under IRC 263(a) 56 56 Environmental liability 9 9 Valuation allowance (27,135 ) (26,247 ) 172 172 Deferred tax liability: Basis difference of land and improvement inventories 172 172 Net deferred tax asset $ - $ - |
11. Fair Value of Financial Ins
11. Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2016 | |
Notes to Financial Statements | |
Fair Value of Financial Instruments | The carrying amount of the Companys financial instruments, other than debt, approximates fair value at March 31, 2016 and December 31, 2015 because of the short maturity of those instruments. It was not practicable to estimate the fair value of the Companys debt with its primary lender, its notes payable and its convertible debentures because these debts are in default causing no basis for estimating value by reference to quoted market prices or current rates offered to the Company for debt of the same remaining maturities. |
2. Per Share Data (Tables)
2. Per Share Data (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Summary of the calculations used in computing basic and diluted loss per share | Three Months Ended March 31, March 31, 2016 2015 Net Loss $ (2,336,000 ) $ (1,887,000 ) Preferred dividends (160,000 ) (160,000 ) Loss Available to $ (2,496,000 ) $ (2,047,000 ) Common shareholders Weighted Average Number Of Common Shares Outstanding 5,317,758 5,317,758 Basic and Diluted Loss Per Share $ (0.47 ) $ (0.38 ) |
5. Receivables (Tables)
5. Receivables (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Receivables [Abstract] | |
Receivables | March 31, December 31, 2016 2015 ($ in thousands) Notes receivable - related party $ 149 $ 178 |
6. Land and Improvements (Table
6. Land and Improvements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Real Estate [Abstract] | |
Land and improvement inventories | March 31, December 31, 2016 2015 ($ in thousands) Unimproved land $ 625 $ 625 Fully improved land 14 14 $ 639 $ 639 |
7. Other Assets (Tables)
7. Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Other Assets [Abstract] | |
Other assets consist | March 31, December 31, 2016 2015 ($ in thousands) Deposit with Trustee of 6-1/2% debentures $ 41 $ 41 Prepaid expenses 1 2 Other 4 1 $ 46 $ 44 |
8. Accounts Payable and Accru21
8. Accounts Payable and Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued expenses consist | March 31, December 31, 2016 2015 ($ in thousands) Accounts payable $ 18 $ 7 Accrued audit & professional 36 40 Accrued legal 5 - Accrued consulting fees-related party 1 1 Environmental remediation obligations 25 25 Accrued debenture fees 130 128 Accrued miscellaneous 1 1 $ 216 $ 202 Accrued real estate taxes consisted of: Current real estate taxes $ 2 $ 8 |
9. Primary Lender Credit Agre22
9. Primary Lender Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Primary Lender Credit Agreements Notes Payable Subordinated And Convertible Debentures Payable | |
Credit agreements with the Company primary lender and notes payable | March 31, December 31, 2016 2015 ($ in thousands) Credit agreements - primary lender-related party balance is past due, bearing interest at prime plus 5%; due June 1, 1997 $ 500 $ 500 Notes payable - $1,176,000 bearing interest at prime plus 2%, the remainder non-interest bearing, all past due 1,198 1,198 1,698 1,698 Subordinated debentures payable: At 6-1/2% interest; due June 1, 1991 447 447 At 6% interest; due May 1, 1992 8,025 8,025 8,472 8,472 Collateralized convertible debentures payable-related party: At 14% interest; due July 8, 1997, convertible into shares of common stock at $1.72 per share 1,500 1,500 $ 11,670 $ 11,670 |
10. Income Taxes (Tables)
10. Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Summary of the temporary differences | March 31, December 31, 2016 2015 ($ in thousands) Deferred tax asset Net operating loss carryforward $ 27,230 $ 26,342 Adjustments to reduce land to net realizable value 12 12 Expenses capitalized under IRC 263(a) 56 56 Environmental liability 9 9 Valuation allowance (27,135 ) (26,247 ) 172 172 Deferred tax liability: Basis difference of land and improvement inventories 172 172 Net deferred tax asset $ - $ - |
2. Per Share Data (Details)
2. Per Share Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Basic and Diluted loss per share | ||
Net Loss | $ (2,336) | $ (1,887) |
Preferred Dividends | (160) | (160) |
Loss Available to Common Shareholders | $ (2,496) | $ (2,047) |
Weighted Average Number of Common Shares Outstanding | 5,317,758 | 5,317,758 |
Basic and Diluted Loss Per Share | $ (0.47) | $ (0.38) |
2. Per Share Data (Details Narr
2. Per Share Data (Details Narrative) - shares | Mar. 31, 2016 | Dec. 31, 2015 |
Per Share Data Details Narrative | ||
Common shares outstanding | 5,317,758 | 5,317,758 |
5. Receivables (Details)
5. Receivables (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Net receivables consisted of | ||
Notes receivable - related party | $ 149 | $ 178 |
6. Land and Improvements (Detai
6. Land and Improvements (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Land and improvement inventories | ||
Unimproved land | $ 625 | $ 625 |
Improved Land | 14 | 14 |
Total | $ 639 | $ 639 |
7. Other Assets (Details)
7. Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Other assets consisted of: | ||
Deposit with Trustee of 6-1/2% debentures | $ 41 | $ 41 |
Prepaid expenses | 1 | 2 |
Other | 4 | 1 |
Total Other Assets | $ 46 | $ 44 |
8. Accounts Payable and Accru29
8. Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Accounts payable and accrued expenses | ||
Accounts payable | $ 18 | $ 7 |
Accrued audit & professional | 36 | 40 |
Accrued legal | 5 | 0 |
Accrued consulting fees-related party | 1 | 1 |
Environmental remediation obligations | 25 | 25 |
Accrued debenture fees | 130 | 128 |
Accrued miscellaneous | 1 | 1 |
Total | 216 | 202 |
Accrued real estate taxes consisted of: | ||
Current real estate taxes | $ 2 | $ 8 |
9. Primary Lender Credit Agre30
9. Primary Lender Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Credit agreements primary lender: | ||
Primary lender debt-related party, bearing interest at prime plus 5% | $ 500 | $ 500 |
Notes payable - $1,176,000 bearing interest at prime plus 2%,the remainder non-interest bearing, all past due | 1,198 | 1,198 |
Total credit agreements | 1,698 | 1,698 |
Subordinated debentures payable: | ||
At 6-1/2% interest; due June 1, 1991 | 447 | 447 |
At 6% interest; due May 1, 1992 | 8,025 | 8,025 |
Subordinated convertible debentures payable | 8,472 | 8,472 |
Collateralized convertible debentures payable-related party: | ||
Convertible debt-related party at 14% interest; due July 8, 1997 convertible into shares of common stock at $1.72 per share | 1,500 | 1,500 |
Total | $ 11,670 | $ 11,670 |
9. Primary Lender Credit Agre31
9. Primary Lender Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Mar. 31, 2016 | |
Primary Lender Credit Agreements Notes Payable Subordinated And Convertible Debentures Payable Details Narrative | ||
Debt Instrument surrendered | $ 80 | |
Debenture reserve utilized | 7 | |
Forgiveness of Debt | 73 | |
Forgiveness of interest | 136 | |
Subordinated Convertible Debt Noncurrent | 447 | $ 447 |
Accrued Interest Subordinated Convertible Debentures | $ 788 | $ 795 |
10. Income Taxes (Details)
10. Income Taxes (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Deferred tax asset: | ||
Net operating loss carryforward | $ 27,230 | $ 26,342 |
Adjustments to reduce land to net realizable value | 12 | 12 |
Expenses capitalized under IRC 263(a) | 56 | 56 |
Environmental liability | 9 | 9 |
Valuation allowance | (27,135) | (26,247) |
Total tax asset | 172 | 172 |
Deferred tax liability: | ||
Basis difference of land and improvement inventories | 172 | 172 |
Net deferred tax asset | $ 0 | $ 0 |
10. Income Taxes (Details Narra
10. Income Taxes (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Income Taxes Details Narrative | |
Operating loss carryforward | $ 69,321 |
Operating losses expire date | The operating losses expire at various dates through 2035. |