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(Mark One)
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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2014
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Maryland
(State or other jurisdiction of
incorporation or organization)
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95-6881527
(I.R.S. Employer
Identification Number)
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1114 Avenue of the Americas, 39
th
Floor
New York, NY
(Address of principal executive offices)
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10036
(Zip code)
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Title of each class:
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Name of Exchange on which registered:
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Common Stock, $0.001 par value
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New York Stock Exchange
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8.000% Series D Cumulative Redeemable
Preferred Stock, $0.001 par value
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New York Stock Exchange
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7.875% Series E Cumulative Redeemable
Preferred Stock, $0.001 par value
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New York Stock Exchange
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7.8% Series F Cumulative Redeemable
Preferred Stock, $0.001 par value
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New York Stock Exchange
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7.65% Series G Cumulative Redeemable
Preferred Stock, $0.001 par value
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New York Stock Exchange
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7.50% Series I Cumulative Redeemable
Preferred Stock, $0.001 par value
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New York Stock Exchange
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Title of each class:
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Name of Exchange on which registered:
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4.50% Series J Convertible Perpetual
Preferred Stock, $0.001 par value |
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N/A
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a
smaller reporting company)
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Smaller reporting company
o
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(1)
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For purposes of this Annual Report only, includes all outstanding Common Stock other than Common Stock held directly by the registrant's directors and executive officers.
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1.
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Portions of the registrant's definitive proxy statement for the registrant's
2015
Annual Meeting, to be filed within 120 days after the close of the registrant's fiscal year, are incorporated by reference into Part III of this Annual Report on Form 10-K.
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(a)
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and (c) Financial statements and schedules—see the Company's Annual Report on Form 10-K filed on March 2, 2015. Refer to Exhibit 99.1 to this Amendment No. 1 for the separate audited financial statements and related disclosures of Marina Palms, LLC and Subsidiaries, which is required to be filed under Rule 3-09 of Regulation S-X.
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(b)
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Exhibits—see index below.
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Exhibit
Number
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Document Description
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3.1
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Amended and Restated Charter of the Company (including the Articles Supplementary for each Series of the Company's Preferred Stock).(1)
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3.2
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Amended and Restated Bylaws of the Company.(2)
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3.3
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Articles Supplementary for High Performance Common Stock-Series 1.(4)
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3.4
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Articles Supplementary for High Performance Common Stock-Series 2.(4)
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3.5
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Articles Supplementary for High Performance Common Stock-Series 3.(4)
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3.6
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Articles Supplementary relating to Series E Preferred Stock.(5)
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3.7
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Articles Supplementary relating to Series F Preferred Stock.(29)
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3.8
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Articles Supplementary relating to Series G Preferred Stock.(7)
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3.9
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Articles Supplementary relating to Series I Preferred Stock.(9)
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3.10
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Articles Supplementary relating to Series J Preferred Stock.(17)
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4.1
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Form of 77/8% Series E Cumulative Redeemable Preferred Stock Certificate.(5)
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4.2
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Form of 7.8% Series F Cumulative Redeemable Preferred Stock Certificate.(6)
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4.3
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Form of 7.65% Series G Cumulative Redeemable Preferred Stock Certificate.(7)
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4.4
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Form of 7.50% Series I Cumulative Redeemable Preferred Stock Certificate.(9)
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4.5
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Form of 4.50% Series J Cumulative Convertible Perpetual Preferred Stock Certificate.(23)
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4.6
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Form of Stock Certificate for the Company's Common Stock.(32)
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4.7
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Form of Global Note evidencing 5.85% Senior Notes due 2017 issued on March 9, 2007.(21)
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4.8
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Form of Global Note evidencing 5.875% Senior Notes due 2016 issued on February 21, 2006.(16)
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4.9
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Form of Global Note evidencing 6.05% Senior Notes due 2015 issued on April 21, 2005.(14)
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4.10
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Form of Global Note evidencing 9.0% Senior Series B Notes due 2017 issued on July 9, 2012.(26)
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4.11
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Form of Global Note evidencing 7.125% Senior Notes due 2018 issued on November 13, 2012.(27)
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4.12
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Form of Global Note evidencing 3.00% Convertible Senior Notes due 2016 issued on November 13, 2012.(27)
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Exhibit
Number
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Document Description
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4.13
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Form of Global Note evidencing 3.875% Senior Notes due 2016 issued on May 10, 2013.(28)
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4.14
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Form of Global Note evidencing 4.875% Senior Notes due 2018 issued on May 10, 2013.(28)
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4.15
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Form of Rule 144A Global Note evidencing 1.50% Convertible Senior Notes due 2016 issued on
November 19, 2013.(11)
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4.16
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Form of Global Note, No. 1-A evidencing 4.00% Senior Notes due 2017 issued on June 13, 2014.(30)
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4.17
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Form of Global Note, No. 1-B evidencing 4.00% Senior Notes due 2017 issued on June 13, 2014.(30)
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4.18
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Form of Global Note, No. 2-A evidencing 5.00% Senior Notes due 2019 issued on June 13, 2014.(30)
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4.19
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Form of Global Note, No. 2-B evidencing 5.00% Senior Notes due 2019 issued on June 13, 2014.(30)
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4.20
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Eighth Supplemental Indenture, dated as of April 21, 2005, governing the 6.05% Senior Notes due 2015.(15)
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4.21
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Eleventh Supplemental Indenture, dated as of February 21, 2006, governing the 5.875% Senior Notes due 2016.(16)
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4.22
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Seventeenth Supplemental Indenture, dated as of March 9, 2007, governing the 5.85% Senior Notes due 2017.(20)
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4.23
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Base Indenture, dated as of February 5, 2001, between the Company and State Street Bank and Trust Company.(3)
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4.24
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Indenture, dated as of May 8, 2012, between the Company and U.S. Bank National Association governing the 9.0% Senior Series B Notes due 2017.(25)
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4.25
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Twenty-First Supplemental Indenture, dated as of November 13, 2012 governing the 7.125% Senior Notes due 2018.(27)
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4.26
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Twenty-Second Supplemental Indenture, dated as of November 13, 2012 governing the 3.00% Convertible Senior Notes due 2016.(27)
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4.27
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Twenty-Third Supplemental Indenture, dated as of May 10, 2013, governing the 3.875% Senior Notes due 2016.(28)
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4.28
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Twenty-Fourth Supplemental Indenture, dated as of May 10, 2013, governing the 4.875% Senior Notes due 2018.(28)
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4.29
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Twenty-Sixth Supplemental Indenture, dated June 13, 2014, governing the 4.00% Senior Notes due 2017.(30)
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4.30
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Twenty-Seventh Supplemental Indenture, dated June 13, 2014, governing the 5.00% Senior Notes due 2019.(30)
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10.1
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iStar Financial Inc. 2007 Incentive Compensation Plan.(31)
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10.2
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iStar Financial Inc. 2009 Long Term Incentive Compensation Plan.(18)
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10.3
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iStar Financial Inc. 2013 Performance Incentive Plan.(18)
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10.4
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Non-Employee Directors' Deferral Plan.(10)
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10.5
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Form of Restricted Stock Unit Award Agreement.(19)
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10.6
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Form of Restricted Stock Unit Award Agreement (Performance-Based Vesting).(22)
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10.7
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Form of Award Agreement For Investment Pool.
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10.8
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Credit Agreement, dated as of March 19, 2012, by the Company, the banks set forth therein and Barclays Bank PLC, as administrative agent, Bank Of America, N.A., as syndication agent, JPMorgan Chase Bank, N.A., as documentation agent.(24)
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Exhibit
Number
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Document Description
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10.9
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Security Agreement, dated as of March 19, 2012, made by the Company, and the other parties thereto in favor of Barclays Bank PLC, as administrative agent.(24)
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12.1
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Computation of Ratio of Earnings to fixed charges and Earnings to fixed charges and preferred stock dividends.(32)
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12.2
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Computation of Ratio of Adjusted EBITDA to interest expense and preferred dividends.(32)
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14.0
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iStar Financial Inc. Code of Conduct.(12)
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21.1
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Subsidiaries of the Company.(32)
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23.1
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Consent of PricewaterhouseCoopers LLP.(32)
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23.2
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Consent of Gerson, Preston, Robinson & Co., P.A.
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31.0
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Certifications pursuant to Section 302 of the Sarbanes-Oxley Act.
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32.0
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Certifications pursuant to Section 906 of the Sarbanes-Oxley Act.
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99.1
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Consolidated Financial Statements of Marina Palms, LLC and Subsidiaries for the year ended December 31, 2014 and for the period from April 17, 2013 through December 31, 2013.
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100
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XBRL-related documents.(32)
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101
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Interactive data file.(32)
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(1)
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Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000 filed on May 15, 2000.
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(2)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on October 25, 2013.
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(3)
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Incorporated by reference from the Company's Form S-3 Registration Statement filed on February 12, 2001.
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(4)
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Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2002 filed on November 14, 2002.
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(5)
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Incorporated by reference from the Company's Current Report on Form 8-A filed on July 8, 2003.
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(6)
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Incorporated by reference from the Company's Current Report on Form 8-A filed on September 25, 2003.
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(7)
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Incorporated by reference from the Company's Current Report on Form 8-A filed on December 10, 2003.
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(8)
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Incorporated by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 2003 filed on March 15, 2004.
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(9)
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Incorporated by reference from the Company's Current Report on Form 8-A filed on February 27, 2004.
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(10)
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Incorporated by reference from the Company's Definitive Proxy Statement filed on April 28, 2004.
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(11)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on November 19, 2013.
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(12)
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Incorporated by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 2004 filed on March 16, 2005.
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(13)
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Incorporated by reference from Falcon Financial Investment Trust's Form 8-K filed on January 24, 2005.
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(14)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on April 20, 2005.
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(15)
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Incorporated by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 2005 filed on March 16, 2006.
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(16)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on February 24, 2006.
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(17)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on March 18, 2013.
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(18)
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Incorporated by reference from the Company's Definitive Proxy Statement filed on April 11, 2014.
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(19)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on January 25, 2007.
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(20)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on March 15, 2007.
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(21)
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Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 filed on May 9, 2007.
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(22)
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Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2008 filed on May 9, 2008.
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(23)
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Incorporated by reference from the Company's Current Report on Form 8-A filed on March 18, 2013.
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(24)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on March 23, 2012.
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(25)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on May 11, 2012.
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(26)
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Incorporated by reference from the Company's Form S-4 Registration Statement filed on June 8, 2012.
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(27)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on November 19, 2012.
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(28)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on May 16, 2013.
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(29)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on September 30, 2003.
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(30)
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Incorporated by reference from the Company's Current Report on Form 8-K filed on June 13, 2014.
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(31)
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Incorporated by reference from the Company's Definitive Proxy Statement filed on April 27, 2007.
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(32)
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Incorporated by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 2014 filed on March 2, 2015.
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iSTAR FINANCIAL INC.
Registrant
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Date:
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March 27, 2015
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/s/ DAVID DISTASO
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David DiStaso
Chief Financial Officer (principal financial and
accounting officer)
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Investment Pool:
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Covers Investments made during the period January 1, 2013 through December 31, 2014
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Date:
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March 27, 2015
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By:
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/s/ JAY SUGARMAN
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||
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Name:
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Jay Sugarman
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Title:
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Chief Executive Officer
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Date:
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March 27, 2015
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By:
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/s/ DAVID DISTASO
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Name:
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David DiStaso
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Title:
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Chief Financial Officer (principal
financial and accounting officer)
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Date:
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March 27, 2015
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By:
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/s/ JAY SUGARMAN
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||
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Name:
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Jay Sugarman
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Title:
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Chief Executive Officer
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Date:
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March 27, 2015
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By:
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/s/ DAVID DISTASO
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Name:
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David DiStaso
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Title:
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Chief Financial Officer (principal
financial and accounting officer)
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|
PAGE
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Independent Auditor’s Report
|
|
|
|
Consolidated Financial Statements:
|
|
Balance Sheets
|
1
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Statements of Operations
|
2
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Statements of Members’ Capital
|
3
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Statements of Cash Flows
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4
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|
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Notes to Consolidated Financial Statements
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5-8
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Marina Palms, LLC and Subsidiaries
|
|||||||
Consolidated Statements of Operations
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|||||||
For the Year Ended December 31, 2014 and
|
|||||||
the Period From April 17, 2013 Through December 31, 2013
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|||||||
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||||
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||||
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|
||||
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2014
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2013
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||||
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(Unaudited)
|
||||
Revenues
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|
||||
Sales of condominiums
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$
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113,992,860
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|
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$
|
—
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|
Forfeited deposits
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5,000
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|
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40,000
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|
||
Interest and other
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127,437
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33,266
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||
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|
||||
Total revenues
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114,125,297
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|
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73,266
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||
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|
||||
Costs and expenses
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|
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|
||||
Condominium cost of sales
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65,632,971
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|
|
—
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|
||
Operating, sales and marketing expenses
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11,486,931
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|
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3,524,903
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||
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|
||||
Total costs and expenses
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77,119,902
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3,524,903
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||
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|
||||
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|
||||
Net income (loss)
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$
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37,005,395
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|
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$
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(3,451,637
|
)
|
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Marina Palms, LLC and Subsidiaries
|
|||||||||||
Consolidated Statements of Members' Capital
|
|||||||||||
For the Year Ended December 31, 2014 and
|
|||||||||||
the Period From April 17, 2013 Through December 31, 2013
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|||||||||||
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|
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|
||||||
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|
||||||
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|
||||||
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Retained Earnings/
|
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|
||||||
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Capital
|
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(Accumulated
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Total
|
||||||
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Contributions
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Deficit)
|
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Members' Capital
|
||||||
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|
||||||
Balance, April 17, 2013 (Unaudited)
|
$
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—
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|
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$
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—
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|
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$
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—
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|
|
|
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|
|
|
||||||
Capital contributions
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20,078,750
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|
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—
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20,078,750
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|
|||
|
|
|
|
|
|
||||||
Net (loss)
|
—
|
|
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(3,451,637
|
)
|
|
(3,451,637
|
)
|
|||
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|
|
|
|
|
||||||
Balance, December 31, 2013 (Unaudited)
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20,078,750
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|
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(3,451,637
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)
|
|
16,627,113
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|
|||
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|
|
|
|
|
||||||
Capital contributions
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10,448,230
|
|
|
—
|
|
|
10,448,230
|
|
|||
|
|
|
|
|
|
||||||
Net income
|
—
|
|
|
37,005,395
|
|
|
37,005,395
|
|
|||
|
|
|
|
|
|
||||||
Balance, December 31, 2014
|
$
|
30,526,980
|
|
|
$
|
33,553,758
|
|
|
$
|
64,080,738
|
|
Marina Palms, LLC and Subsidiaries
|
|||||||
Consolidated Statements of Cash Flows
|
|||||||
For the Year Ended December 31, 2014 and
|
|||||||
the Period From April 17, 2013 Through December 31, 2013
|
|||||||
|
|
|
|
||||
|
|
|
|
||||
|
2014
|
|
2013
|
||||
|
|
|
(Unaudited)
|
||||
Operating activities
|
|
|
|
||||
Net income (loss)
|
$
|
37,005,395
|
|
|
$
|
(3,451,637
|
)
|
Adjustments to reconcile net income (loss) to net cash (used in)
|
|
|
|
||||
operating activities:
|
|
|
|
||||
Net change in percentage of completion revenue
|
(54,026,242
|
)
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
(Increase) in restricted cash
|
(7,463,105
|
)
|
|
(80,913,133
|
)
|
||
(Increase) in investment in real estate
|
—
|
|
|
(56,760,681
|
)
|
||
(Increase) in prepaid expenses and other assets
|
(50,927
|
)
|
|
(54,050
|
)
|
||
Increase in accounts payable and accrued expenses
|
8,180,663
|
|
|
3,497,321
|
|
||
Increase in customer deposits
|
—
|
|
|
82,178,423
|
|
||
|
|
|
|
||||
Net cash (used in) operating activities
|
(16,354,216
|
)
|
|
(55,503,757
|
)
|
||
|
|
|
|
||||
Financing activities
|
|
|
|
||||
Proceeds from promissory note
|
—
|
|
|
20,000,000
|
|
||
Repayment of promissory note
|
—
|
|
|
(20,000,000
|
)
|
||
Proceeds from note payable
|
11,012,231
|
|
|
35,802,298
|
|
||
Contributions from members
|
10,448,230
|
|
|
20,078,750
|
|
||
|
|
|
|
||||
Net cash provided by financing activities
|
21,460,461
|
|
|
55,881,048
|
|
||
|
|
|
|
||||
Net increase in cash
|
5,106,245
|
|
|
377,291
|
|
||
|
|
|
|
||||
Cash and cash equivalents, beginning of period
|
377,291
|
|
|
—
|
|
||
|
|
|
|
||||
Cash and cash equivalents, end of period
|
$
|
5,483,536
|
|
|
$
|
377,291
|
|
|
|
|
|
||||
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Interest paid during the period
|
$
|
1,574,303
|
|
|
$
|
1,368,892
|
|
|
|
|
|
||||
Interest capitalized to investment in real estate
|
$
|
1,574,303
|
|
|
$
|
1,368,892
|
|
|
|
|
|
||||
Supplemental disclosures of noncash activities:
|
|
|
|
||||
In connection with percentage of completion revenue recognition:
|
|
|
|
||||
Decrease in investment in real estate due to sales
|
$
|
(65,632,971
|
)
|
|
$
|
—
|
|
Increase in investment in real estate due to capital expenditures
|
39,553,015
|
|
|
|
|||
Increase in sales contracts receivable
|
133,021,548
|
|
|
—
|
|
||
Increase in deferred selling costs
|
8,047,394
|
|
|
—
|
|
||
Decrease in customer deposits
|
58,042,460
|
|
|
—
|
|
||
Increase in deferred revenue
|
(118,453,716
|
)
|
|
—
|
|
||
Increase in accounts payable and accrued expenses
|
(551,488
|
)
|
|
—
|
|
||
|
|
|
|
||||
|
$
|
54,026,242
|
|
|
$
|
—
|
|
1.
|
Formation and Description of Business
|
2.
|
Summary of Significant Accounting Policies
|
2.
|
Summary of Significant Accounting Policies (Cont’d.)
|
2.
|
Summary of Significant Accounting Policies (Cont’d.)
|
3.
|
Concentration of Credit Risk
|
4.
|
Notes Payable
|
5.
|
Fair Value Measurements
|
(a)
|
Fair Value of Financial Instruments
|
•
|
The carrying value of cash and cash equivalents, restricted cash, sales contracts receivables, deferred selling costs, prepaid expenses and other assets, accounts payable and accrued expenses, deferred revenue and customer deposits approximate fair value due to the short maturity of these instruments.
|
•
|
The carrying value of the note payable approximates its fair value due to the interest rate being reset to the market rate on a periodic basis.
|
(b)
|
Fair Value Hierarchy
|
Level 1
|
Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Company has the ability to access at the measurement date.
|
Level 2
|
Inputs to the valuation methodology include:
|
d)
|
Inputs that are derived principally from or corroborated by observable market data by correlation or other means.
|
Level 3
|
Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
|