UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
(Mark One)
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x
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QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For
the quarterly period ended March 31, 2010
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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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Commission
File Number:
1-8356
DVL,
INC.
(Exact
name of registrant as specified in its charter)
|
Delaware
|
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13-2892858
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|
(State
or other jurisdiction of incorporation or organization)
|
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(I.R.S.
Employer Identification No.)
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70
East 55
th
Street, New York, New York
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10022
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(Address
of principal executive offices)
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(Zip
Code)
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(212)
350-9900
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(registrant’s
telephone number, including area code)
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(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 (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
o
No
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit
and post such files).
o
Yes
o
No
Indicate
by check mark whether the registrant is a large accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of
“large accelerated filer” “accelerated filer” and “smaller reporting company” in
Rule 12b-2 of the Exchange Act.
|
Large
accelerated filer
o
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Accelerated
filer
o
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Non-accelerated
filer (Do not check if a smaller reporting company)
o
|
Smaller
reporting company
x
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).
o
Yes
x
No
The
number of shares outstanding of the issuer’s classes of common equity, as of May
14, 2010 was:
|
Class
|
|
Number of Shares
|
|
|
|
|
|
Common
Stock, $.01 par value
|
|
44,770,345
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INDEX
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Part
I
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Financial
Information:
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Pages
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Item
1. – Financial Statements:
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2 –
3
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4 –
5
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6
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7 –
8
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9 –
14
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15
– 20
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20
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20
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Part
II
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Other
Information:
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21
– 25
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26
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Part
I – FINANCIAL INFORMATION
Item
1. Financial Statements
DVL,
INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
(in
thousands)
|
|
|
March
31,
|
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|
December
31,
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
(unaudited)
|
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|
|
ASSETS
|
|
|
|
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|
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|
Residual
interests in securitized portfolios
|
|
$
|
40,805
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|
$
|
42,699
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage
loans receivable from affiliated partnerships (net
of unearned interest of $3,721 for 2010 and $4,037 for
2009)
|
|
|
13,308
|
|
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13,326
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|
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|
|
|
|
|
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|
Allowance
for loan losses
|
|
|
(2,884
|
)
|
|
|
(2,884
|
)
|
|
|
|
|
|
|
|
|
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|
Net
mortgage loans receivable
|
|
|
10,424
|
|
|
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10,442
|
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|
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|
|
|
|
|
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Cash
(including restricted cash of $269 for 2010 and $274 for
2009)
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1,199
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1,067
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|
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Investments
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Real
estate at cost (net of accumulated depreciation and
|
|
|
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amortization of $1,618 for 2010
and $1,564 for 2009)
|
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9,272
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9,564
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|
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|
|
|
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Affiliated
limited partnerships (net of allowance for
|
|
|
|
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|
|
|
|
|
losses of $375 for 2010 and
2009)
|
|
|
657
|
|
|
|
657
|
|
|
|
|
|
|
|
|
|
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|
Net
deferred tax asset
|
|
|
1,969
|
|
|
|
2,068
|
|
|
|
|
|
|
|
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|
Other
assets
|
|
|
1,682
|
|
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|
1,762
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
of discontinued operations
|
|
|
-
|
|
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|
212
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
66,008
|
|
|
$
|
68,471
|
|
(continued)
See notes
to consolidated financial statements.
DVL,
INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
(in
thousands except share data)
(continued)
|
|
|
March
31,
|
|
|
December
31,
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
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|
|
|
|
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Liabilities:
|
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|
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|
|
|
|
|
|
|
|
|
|
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Notes
payable - residual interests
|
|
$
|
25,551
|
|
|
$
|
28,155
|
|
|
Underlying
mortgages payable
|
|
|
2,545
|
|
|
|
2,708
|
|
|
Debt
- other
|
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|
10,544
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|
|
|
10,694
|
|
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Debt
- affiliates
|
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|
1,162
|
|
|
|
1,129
|
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Interest
rate swaps
|
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|
174
|
|
|
|
176
|
|
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Security
deposits, accounts payable and accrued
|
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|
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liabilities
(including deferred income of $210
|
|
|
|
|
|
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for
2010 and $71 for 2009)
|
|
|
1,263
|
|
|
|
1,194
|
|
|
Total
liabilities
|
|
|
41,239
|
|
|
|
44,056
|
|
|
|
|
|
|
|
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|
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Commitments
and contingencies
|
|
|
|
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Shareholders'
equity:
|
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|
|
|
|
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Preferred
stock, $10.00 par value, authorized, issued
|
|
|
|
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|
and
outstanding 100 shares
|
|
|
1
|
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|
1
|
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|
Preferred
stock, $.01 par value, authorized 5,000,000
|
|
|
|
|
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|
shares,
issued and outstanding -0-
|
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-
|
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|
-
|
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Common
stock, $.01 par value, authorized 90,000,000
|
|
|
|
|
|
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|
shares,
issued and outstanding 44,770,345 for 2010 and
|
|
|
|
|
|
|
|
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|
2009
|
|
|
448
|
|
|
|
448
|
|
|
Additional
paid-in-capital
|
|
|
97,003
|
|
|
|
97,003
|
|
|
Deficit
|
|
|
(72,535
|
)
|
|
|
(72,861
|
)
|
|
Accumulated
other comprehensive loss
|
|
|
(148
|
)
|
|
|
(176
|
)
|
|
Total
shareholders' equity
|
|
|
24,769
|
|
|
|
24,415
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and shareholders' equity
|
|
$
|
66,008
|
|
|
$
|
68,471
|
|
See notes
to consolidated financial statements.
DVL
, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
(in
thousands)
(unaudited)
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Income
from affiliates:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
on mortgage loans
|
|
$
|
486
|
|
|
$
|
528
|
|
|
Partnership
management fees
|
|
|
60
|
|
|
|
53
|
|
|
Management
fees
|
|
|
121
|
|
|
|
153
|
|
|
Transaction
and other fees from partnerships
|
|
|
1
|
|
|
|
25
|
|
|
Distributions
from partnerships
|
|
|
52
|
|
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
from others:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income - residual interests
|
|
|
1,592
|
|
|
|
1,542
|
|
|
Net
rental income (including depreciation and
|
|
|
|
|
|
|
|
|
|
amortization
of $25 for 2010 and $50 for 2009)
|
|
|
128
|
|
|
|
66
|
|
|
Other
income and interest
|
|
|
8
|
|
|
|
21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,448
|
|
|
|
2,464
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General
and administrative
|
|
|
480
|
|
|
|
584
|
|
|
Asset
servicing fee - NPO Management LLC
|
|
|
195
|
|
|
|
195
|
|
|
Legal
and professional fees
|
|
|
214
|
|
|
|
73
|
|
|
Provision
for loan losses
|
|
|
-
|
|
|
|
100
|
|
|
Provision
for impairment
|
|
|
245
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underlying
mortgages
|
|
|
50
|
|
|
|
64
|
|
|
Notes
payable - residual interests
|
|
|
542
|
|
|
|
689
|
|
|
Affiliates
|
|
|
34
|
|
|
|
45
|
|
|
Others
|
|
|
213
|
|
|
|
344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,973
|
|
|
|
2,094
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
from continuing operations before income tax expense
|
|
|
475
|
|
|
|
370
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
tax expense
|
|
|
(99
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
from continuing operations
|
|
|
376
|
|
|
|
370
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
income from discontinued operations - net of tax of $-0-
in
|
|
|
|
|
|
|
|
|
|
both periods
|
|
|
(50
|
)
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
326
|
|
|
$
|
377
|
|
(continued)
See notes
to consolidated financial statements.
DVL,
INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
(in
thousands)
(unaudited)
(continued)
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
from continuing operations
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
(Loss)
income from discontinued operations
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per share:
|
|
|
|
|
|
|
|
|
|
Income
from continuing operations
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
(Loss)
income from discontinued operations
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding - basic
|
|
|
44,770,345
|
|
|
|
44,770,345
|
|
|
Effect
of diluted securities
|
|
|
55,317
|
|
|
|
34,445
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding - diluted
|
|
|
44,825,662
|
|
|
|
44,804,790
|
|
See notes
to consolidated financial statements.
DVL
, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENT OF SHAREHOLDERS’ EQUITY
(in
thousands except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
Preferred
Stock
|
|
|
Common
Stock
|
|
|
Additional
|
|
|
|
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Paid-In
|
|
|
|
|
|
Comprehensive
|
|
|
|
|
Comprehensive
|
|
|
|
|
Shares
|
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Deficit
|
|
|
Income
(Loss)
|
|
|
Total
|
|
|
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
- January 1, 2010
|
|
|
100
|
|
|
|
$
|
1
|
|
|
|
44,770,345
|
|
|
$
|
448
|
|
|
$
|
97,003
|
|
|
$
|
(72,861
|
)
|
|
$
|
(176
|
)
|
|
$
|
24,415
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization
of deferred loss on interest rate
swap agreements
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
28
|
|
|
|
28
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
|
-
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
326
|
|
|
|
-
|
|
|
|
326
|
|
|
|
326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
- March 31, 2010
|
|
|
100
|
|
|
|
$
|
1
|
|
|
|
44,770,345
|
|
|
$
|
448
|
|
|
$
|
97,003
|
|
|
$
|
(72,535
|
)
|
|
$
|
(148
|
)
|
|
$
|
24,769
|
|
|
$
|
354
|
|
See notes
to consolidated financial statements.
DVL
, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in
thousands)
(unaudited
)
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations:
|
|
|
|
|
|
|
|
Net
Income
|
|
$
|
326
|
|
|
$
|
377
|
|
|
Loss
(gain) from discontinued operations
|
|
|
50
|
|
|
|
(7
|
)
|
|
Adjustments
to reconcile income to net cash provided by
|
|
|
|
|
|
|
|
|
|
(used in) operating activities from continuing operations
|
|
|
|
|
|
|
|
|
|
Interest
accretion on residual interests
|
|
|
(53
|
)
|
|
|
(59
|
)
|
|
Net
decrease in accrued interest on debt
|
|
|
(5
|
)
|
|
|
(7
|
)
|
|
Depreciation
and amortization
|
|
|
79
|
|
|
|
61
|
|
|
Provision
for loan losses
|
|
|
-
|
|
|
|
100
|
|
|
Provision
for impairment
|
|
|
245
|
|
|
|
-
|
|
|
Amortization
of unearned interest on loans receivable
|
|
|
(316
|
)
|
|
|
(298
|
)
|
|
Net
decrease in deferred tax asset
|
|
|
99
|
|
|
|
-
|
|
|
Net
decrease in other assets
|
|
|
80
|
|
|
|
345
|
|
|
Net
(decrease) increase in accounts payable, security deposits
|
|
|
|
|
|
|
|
|
|
and accrued liabilities
|
|
|
(70
|
)
|
|
|
156
|
|
|
Net
increase in deferred income
|
|
|
139
|
|
|
|
100
|
|
|
Net
cash provided by continuing operations
|
|
|
574
|
|
|
|
768
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations:
|
|
|
|
|
|
|
|
|
|
(Loss)
gain from discontinued operations
|
|
|
(50
|
)
|
|
|
7
|
|
|
Loss
(gain) on sale of discontinued assets
|
|
|
50
|
|
|
|
(120
|
)
|
|
Net
decrease in assets and liabilities of
|
|
|
|
|
|
|
|
|
|
discontinued operations
|
|
|
-
|
|
|
|
5
|
|
|
Cash
used in discontinued operations
|
|
|
-
|
|
|
|
(108
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net
cash provided by operating activities
|
|
|
574
|
|
|
|
660
|
|
(continued)
See notes
to consolidated financial statements.
DVL,
INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in
thousands)
(unaudited)
(continued)
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collections
on loans receivable
|
|
$
|
334
|
|
|
$
|
467
|
|
|
Principal
collections on retained interests
|
|
|
1,427
|
|
|
|
388
|
|
|
Real
estate capital improvements
|
|
|
(6
|
)
|
|
|
(6
|
)
|
|
Net
proceeds from the sale of discontinued assets
|
|
|
162
|
|
|
|
595
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
cash provided by investing activities
|
|
|
1,917
|
|
|
|
1,444
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from new borrowings
|
|
|
-
|
|
|
|
4,250
|
|
|
Principal
payments on debt
|
|
|
(112
|
)
|
|
|
(4,623
|
)
|
|
Payments
of prepaid financing costs
|
|
|
-
|
|
|
|
(68
|
)
|
|
Payments
on underlying mortgages payable
|
|
|
(163
|
)
|
|
|
(296
|
)
|
|
Payments
on notes payable - residual interest
|
|
|
(2,084
|
)
|
|
|
(986
|
)
|
|
Payments
related to debt redemptions
|
|
|
-
|
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net
cash used in financing activities
|
|
|
(2,359
|
)
|
|
|
(1,728
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase in cash
|
|
|
132
|
|
|
|
376
|
|
|
Cash,
beginning of period
|
|
|
1,067
|
|
|
|
496
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash,
end of period
|
|
$
|
1,199
|
|
|
$
|
872
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
paid during the period for interest
|
|
$
|
813
|
|
|
$
|
972
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
paid for income taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure of non-cash investing and
|
|
|
|
|
|
|
|
|
|
financing
activities:
|
|
|
|
|
|
|
|
|
|
Residual
interests in securitized portfolios -
|
|
|
|
|
|
|
|
|
|
increase / (decrease)
|
|
$
|
(520
|
)
|
|
$
|
498
|
|
|
Notes
payable - residual interests -
|
|
|
|
|
|
|
|
|
|
increase / (decrease)
|
|
$
|
(520
|
)
|
|
$
|
498
|
|
See notes
to consolidated financial statements.
DVL
, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS (UNAUDITED
)
Dollars
in thousands unless otherwise noted
(except
share and per share amounts)
DVL, Inc.
(“DVL” or the “Company”) is a Delaware corporation headquartered in New York,
New York. DVL is a commercial finance company which is primarily
engaged in (a) the ownership of residual interests in securitized portfolios,
(b) the ownership and servicing of a portfolio of secured commercial mortgage
loans made to limited partnerships in which DVL serves as general partner, which
we refer to as an Affiliated Limited Partnership, (c) the ownership of real
estate and (d) the performance of real estate asset management and
administrative services. In the opinion of DVL, the accompanying
consolidated financial statements contain all adjustments (consisting of only
normal accruals) necessary in order to present a fair presentation of the
consolidated financial position of DVL and the consolidated results of its
operations for the periods set forth herein. The results of the Company’s
operations for the three months ended March 31, 2010 should not be regarded as
indicative of the results that may be expected from its operations for the full
year. For further information, refer to the consolidated financial statements
and the accompanying notes included in DVL’s Annual Report on Form 10-K for the
year ended December 31, 2009.
Certain
amounts from 2009 have been reclassified to conform to the 2010
presentation.
|
3.
|
Residual
Interests in Securitized Portfolios
|
The
Company, through its wholly-owned consolidated subsidiary, S2 Holdings, Inc.
(“S2”), owns 99.9% Class B member interests in Receivables II-A LLC, a limited
liability company (“Receivables II-A”) and Receivables II-B, LLC, a limited
liability company (“Receivables II-B”). The Class B member interests,
which are consolidated into S2 for financial statement reporting purposes,
entitle the Company to be allocated 99.9% of all items of income, loss and
distribution of Receivables II-A and Receivables II-B. Receivables
II-A and Receivables II-B receive all the residual cash flow from five
securitized receivable pools after payment to the securitized note
holders. The Company considered whether member interests should be
considered variable interest entities, when consolidating S2’s ownership of its
member interests and determined that S2’s member interests do not meet the
definition of variable interest entities.
In
accordance with the purchase agreements entered into with respect to the
residual interests, adjustments are made to the receivables and notes payable
based on the performance of the underlying periodic payment receivables, both
increases and decreases, and could be material in the future. Permanent
impairments are recorded immediately through results of operations. Favorable
changes in future cash flows are recognized through results of operations as
interest over the remaining life of the retained interest.
Real
Estate
The
Owned Site-Kearny Property
The
Company currently owns eight buildings totaling 347,000 square feet on eight and
one half acres located in an industrial park in Kearny, NJ leased to various
unrelated tenants (the “Owned Site”). The Owned Site represents a portion of the
Passaic River Development area designated for redevelopment by the town of
Kearny, New Jersey (the “Property”). The Company continues to lease such
Property to multiple tenants until such time as it can redevelop the Property as
described below.
In
connection with the redevelopment of the Kearny Property, on December 11, 2007,
we entered into a Redeveloper Agreement with the Town of
Kearny. Pursuant to the Redeveloper Agreement, the Town of Kearny
designated us as the redeveloper of the Kearny Property. As
redeveloper, we are obligated to redevelop the Kearny Property, at our expense,
in accordance with the plans and specifications described therein, subject to
review and approval of the Planning Board of the Town of Kearny. The initial
plans and specifications provide for the development of up to approximately
150,000 square feet of retail space. The term of the Redeveloper
Agreement along with our rights there under which were originally set to expire
on December 31, 2009, was extended to May 1, 2011. If we are in default of any
terms or conditions of the Redeveloper Agreement and do not cure within the
appropriate time as set forth in the agreement (to the extent that a cure period
is provided for such default), the Town of Kearny is afforded a number of rights
including the right to terminate the Redeveloper Agreement.
The
Company has capitalized costs exclusive of land and building, of $1,064 and
$1,058 at March 31, 2010 and at December 31, 2009, respectively, related to the
development of this project.
In order
to undertake and complete the redevelopment of the Property, we will need to
obtain additional construction financing and, additional loan and equity
financing. Given the current economic conditions, there can be no
assurance that any such additional financing will be obtained on acceptable
terms or at all. Additionally, given the current economic conditions there can
be no assurance that the redevelopment will occur in the five year period
required under the Redevelopment Agreement or at all.
The
Bogota Property
In
October 2004, we entered into an agreement with Bogota Associates and Industrial
Associates, the owners of the land underlying the Bogota, New Jersey leasehold,
pursuant to which the leasehold was cancelled in consideration of the
aforementioned partnerships agreeing to repay certain of our out-of-pocket
expenses including real estate taxes and environmental remediation costs as well
as $50 upon completion of a sale of the property to a third party. In addition,
we own an 8.25% limited partner interest in one of these
partnerships. As of March 31, 2010, the sale has not yet been
consummated. The sale of the property is subject to environmental remediation
which needs to be completed, which will require the Company to expend additional
amounts in excess of the $721 previously expended. The Company cannot
currently estimate the future amounts to be expended. There can be no
assurance that the sale will be consummated and the Company will receive its
reimbursements. The third party continues to lease space. The net
expenses to be reimbursed to us are approximately $721 as of March 31, 2010 not
including the $50 fee or any amounts to be received as a limited
partner.
Foreclosed
Properties
The following table identifies the
properties we have acquired through foreclosure and which were held at March 31,
2010.
|
Location
|
Sq. Ft.
|
Acreage
|
Tenant
|
|
|
|
|
|
|
Brent,
AL
|
34,875
|
5.34
|
Vacant
|
|
Fort
Edward, NY
(1)
|
31,000
|
6.00
|
Vacant
|
|
Soddy
Daisy, TN
|
56,127
|
5.91
|
Vacant
|
|
Kennedy,
TX
|
44,752
|
5.52
|
Vacant
|
|
(1)
|
In
2002 the Company acquired the Fort Edward property through foreclosure
from an affiliated limited partnership. The Company
subsequently discovered that the property had contamination which required
environmental remediation. To date the Company has expended
$1,050 for environmental remediation costs. The environmental
remediation will require the Company to expend additional amounts in
excess of the amounts previously expended. The Company cannot
currently estimate the future amounts to be expended. The
property cannot be sold or otherwise developed until the environmental
remediation is completed. The Company has filed a lawsuit
against the parties it believes are responsible for causing the
environmental contamination. The litigation is ongoing, however
there can be no assurance the Company will be successful in recovering any
funds as a result of the
litigation.
|
|
5.
|
Transactions
with Affiliates
|
Management
Fee Income Earned
The
Company has provided management, accounting, administrative services and office
space to certain entities which are affiliated with NPO Management, LLC (“NPO”)
which are entities engaged in real estate ownership, lending and
management. As compensation, the Company recorded fees of $121 and
$153 during the three months ended March 31, 2010 and 2009,
respectively
Management
and Other Fees and Expenses Incurred
The
Company incurred fees to NPO of $195 for each of the three month periods ended
March 31, 2010 and 2009, under an Asset Servicing Agreement (the “Asset
Servicing Agreement”) between the Company and NPO, pursuant to which NPO
provides the Company with asset management, advisory and administrative services
relating to the assets of the Company and its affiliated limited partnerships.
During 2010 and 2009, the Company provided office space under the Asset
Servicing Agreement to NPO consisting of approximately 500 square feet of the
Company’s New York location.
The
Millennium Group, an affiliate of NPO, received approximately $27 for each of
the three month periods ended March 31, 2010 and 2009, respectively,
representing additional management and analytical services.
Interest
expense on amounts due to Pemmil Funding LLC, members of which are our President
and Chief Executive Officer and members of NPO and their affiliates, with
respect to its loan to DVL were $34 and $45 for the three months ended March 31,
2010 and 2009, respectively.
|
6.
|
Commitments,
Contingent Liabilities and Legal
Proceedings
|
Pursuant to the terms of the Limited
Partnership Settlement, a fund has been established into which DVL is required
to deposit 20% of the cash flow received on certain of its mortgage loans from
Affiliated Limited Partnerships after repayment of certain creditors, 50% of
DVL’s receipts from certain loans to, and general partnership investments in,
Affiliated Limited Partnerships and a contribution of 5% of DVL’s net income
(based on accounting principles generally accepted in the United States of
America) in the years 2004 through 2012 subject to certain
adjustments.
The
Company uses derivatives to manage risks related to interest rate movements on
its floating rate loans. Interest rate swap contracts designated and
qualifying as cash flow hedges are reported at fair value, the Company has
established accounting and reporting standards for derivative
instruments. Specifically, all derivatives are recognized as either
assets or liabilities on the balance sheet and those instruments are measured at
fair value. As of January 1, 2010, the Company decided to discontinue
the use of hedge accounting. Accordingly, changes in the fair value
of derivatives will be reported as a component of interest expense in the
Consolidated Statements of Operations. Additionally, the balance that
existed in other comprehensive income in the Consolidated Statement of
Shareholders’ Equity as of December 31, 2009 will be amortized through the
income statement over the remaining lives of the swap transactions on a
straight-line basis.
The
following table summarizes the notional values of the Company’s derivative
financial instruments. The notional value provides an indication of the extent
of the Company’s involvement in these instruments on March 31, 2010, but does
not represent exposure to credit, interest rate or market risks.
|
Hedge Type
|
Notional Value
|
Rate
|
Termination Date
|
Fair Value
|
|
|
|
|
|
|
|
Interest
rate swap agreement
|
$ 3,689
|
5.94%
|
July
1, 2011
|
$
(148)
|
|
|
|
|
|
|
|
Interest
rate swap agreement
|
$ 1,814
|
6.09%
|
February
1, 2014
|
$ (26)
|
The
following table presents the computation of basic and diluted per share data for
the three months ended March 31, 2010 and 2009.
|
|
|
Three
Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average
|
|
|
|
|
|
|
|
|
Weighted
Average
|
|
|
|
|
|
|
|
|
|
|
Number
of
|
|
|
Per
Share
|
|
|
|
|
|
Number
of
|
|
|
Per
Share
|
|
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
EPS,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income available to common shareholders
|
|
$
|
326
|
|
|
|
44,770,345
|
|
|
$
|
0.01
|
|
|
$
|
377
|
|
|
|
44,770,345
|
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect
of dilutive stock options
|
|
|
-
|
|
|
|
55,317
|
|
|
|
|
|
|
|
-
|
|
|
|
34,445
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
EPS,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income available to common shareholders
|
|
$
|
326
|
|
|
|
44,825,662
|
|
|
$
|
0.01
|
|
|
$
|
377
|
|
|
|
44,804,790
|
|
|
$
|
0.01
|
|
The
Company has two reportable segments; real estate and residual interests. The
real estate business is comprised of real estate assets, mortgage loans on real
estate, real estate management and investments in affiliated limited
partnerships which own real estate. The residual interests business is comprised
of investments in residual interests in securitized receivables portfolios. The
corporate/other net income of $2 in 2010 includes $99 of deferred income tax
expense.
|
|
|
Three
Months Ended
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
Residual
interests
|
|
$
|
1,592
|
|
|
$
|
1,542
|
|
|
Real
estate
|
|
|
848
|
|
|
|
901
|
|
|
Corporate
/ other
|
|
|
8
|
|
|
|
21
|
|
|
Total
consolidated revenues
|
|
$
|
2,448
|
|
|
$
|
2,464
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
|
|
|
|
|
|
|
|
Residual
interests
|
|
$
|
1,043
|
|
|
$
|
846
|
|
|
Real
estate
|
|
|
(669
|
)
|
|
|
(562
|
)
|
|
Corporate
/ other
|
|
|
2
|
|
|
|
86
|
|
|
Total
income from continuing operations
|
|
$
|
376
|
|
|
$
|
370
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
|
As
of
|
|
|
|
|
March
31, 2010
|
|
|
December
31, 2009
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Residual
interests
|
|
$
|
40,805
|
|
|
$
|
42,699
|
|
|
Real
estate
|
|
|
23,234
|
|
|
|
23,704
|
|
|
Corporate
/ other
|
|
|
1,969
|
|
|
|
2,068
|
|
|
Total
consolidated assets
|
|
$
|
66,008
|
|
|
$
|
68,471
|
|
|
10.
|
Fair
Value of Financial Instruments
|
Assets and Liabilities
Recorded at Fair Value
The
Company uses a three-level fair value hierarchy that categorizes assets and
liabilities measured at fair value based on whether the inputs utilized in the
valuation are observable: Level 1 - inputs are quoted prices in active markets
for the identical assets or liabilities; Level 2 - inputs other than quoted
prices that are directly or indirectly observable through market-corroborated
inputs; and Level 3 - inputs are unobservable, or observable but cannot be
market-corroborated, requiring the Company to make assumptions about pricing by
market participants. The following table sets forth information for
the Company’s financial assets and liabilities that are measured at fair value
on a recurring basis:
|
|
|
|
|
|
March
31, 2010
|
|
|
Description
|
|
Carrying
Value
|
|
|
Level
1
|
|
|
Level
2
|
|
|
Level
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Rate Swaps
|
|
$
|
174
|
|
|
$
|
-
|
|
|
$
|
174
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2009
|
|
|
Description
|
|
Carrying
Value
|
|
|
Level
1
|
|
|
Level
2
|
|
|
Level
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Rate Swaps
|
|
$
|
176
|
|
|
$
|
-
|
|
|
$
|
176
|
|
|
$
|
-
|
|
Fair Value of Financial
Instruments
In addition to the above liabilities
which are recorded at fair value, the Company is also required to disclose the
fair value of financial instruments, whether or not recognized in the financial
statements, for which it is practicable to estimate that
value. In cases where quoted market prices are not available,
fair values are estimated using present value or other valuation
techniques. Those assumptions are significantly affected by the
assumptions used, including the estimated market discount rate and the estimated
future cash flows. The following table details the fair value of the
Company’s financial instruments:
|
|
|
March
31, 2010
|
|
|
December
31, 2009
|
|
|
|
|
Carrying
Value
|
|
|
Fair
Value
|
|
|
Carrying
Value
|
|
|
Fair
Value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residual
Interests in Securitized Portfolios
|
|
$
|
40,805
|
|
|
$
|
40,689
|
|
|
$
|
42,699
|
|
|
$
|
41,203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes
Payable - Residual Interests
|
|
|
25,551
|
|
|
|
25,551
|
|
|
|
28,155
|
|
|
|
28,155
|
|
|
11.
|
Discontinued
Operations
|
During
2010 and 2009, the Company disposed of certain real estate
properties. The sale and operation of these properties for all
periods presented have been recorded as discontinued operations in compliance
with our accounting policy.
As of
March 31, 2010, the activities of our Iowa Park, Texas property which was
previously foreclosed on have been included in discontinued operations. This
property was sold during January 2010 for net proceeds of $162 which resulted in
a loss from the sale of discontinued operations of approximately
$50. As of March 31, 2009, the activities of four foreclosed
properties have been included in discontinued operations.
Discontinued
operations for the three months ended March 31, 2010 and 2009 are summarized as
follows:
|
|
|
Three
Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Income
|
|
$
|
-
|
|
|
$
|
16
|
|
|
Expenses
|
|
|
-
|
|
|
|
129
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
from discontinued operations before gain on sale
|
|
|
-
|
|
|
|
(113
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
gain on sale
|
|
|
(50
|
)
|
|
|
120
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
gain from discontinued operations
|
|
$
|
(50
|
)
|
|
$
|
7
|
|
ITEM
2.
MANAGEMENT’S
DISCUSSION AND ANALYSIS
OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(in
thousands)
This
Quarterly Report on Form 10-Q for the quarter ended March 31, 2010 contains
statements which constitute 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. Those statements include statements
regarding the intent, belief or current expectations of DVL, Inc., a Delaware
corporation and its management team. DVL’s shareholders and prospective
investors are cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks and uncertainties, and that
actual results may differ materially from those projected in the forward-looking
statements. Such risks and uncertainties include, among other things, general
economic conditions and other risks and uncertainties that are discussed herein
and in the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2009. All references to “DVL”, “we”, “us”, “our”, or the “Company”
refer to DVL, Inc. and its consolidated subsidiaries.
This
Management’s Discussion and Analysis of Financial Condition and Results of
Operations (“MD&A”) should be read in conjunction with the consolidated
financial statements and accompanying financial statement notes appearing
elsewhere herein and in conjunction with our Annual Report on Form 10-K for the
year ended December 31, 2009.
None of
the recently adopted accounting standards had a material effect on the Company’s
consolidated financial statements.
We are a
commercial finance company which is primarily engaged in (a) the ownership of
residual interests in securitized portfolios, (b) the ownership and servicing of
a portfolio of secured commercial mortgage loans made to Affiliated Limited
Partnerships, (c) the ownership of real estate and (d) the performance of real
estate asset management and administrative services.
We expect that anticipated cash flow
provided by operations and other sources will be sufficient to meet our current
cash requirements through at least the next twelve months. We have in
the past and expect in the future to continue to be required to augment our cash
flow provided by operations with additional cash generated from either the sale
or refinancing of portions of our assets and/or borrowings. We
currently do not generate sufficient cash flow from operations to meet our cash
requirements or to permit us to pay a dividend on our common
stock. Excluding proceeds generated from the sale of assets, our cash
flow would have been a net decrease in cash of $30 for the three months ended
March 31, 2010. Cash flow in any given quarter is not necessarily
indicative of the cash flow from any other quarter because of the seasonality of
cash receipts and disbursements.
Many of the mortgages currently held by
us have underlying loans or are pledged to secure debt, which are serviced by
much if not all of the cash flow generated from the repayment of our mortgage
portfolio. During 2008 and 2009, we foreclosed on six of our mortgage
loans due to the Affiliated Limited Partnerships’ failure to pay amounts due on
such loans. At the time of the foreclosure, the mortgages had a
combined carrying value of $2,760. During the quarter ended March 31,
2010 we sold one of these properties for net proceeds of $162, which resulted in
a loss of $50. During the quarter ended March 31, 2009, we sold one
of these properties and received net proceeds of $595, which resulted in a gain
of $120. All of the properties are being held for lease or sale and
at March 31, 2010 remain vacant and unsold. As a result, we are
obligated for all costs at these properties including property taxes and
insurance. Considering the status of the property markets and the
location of our properties there can be no assurance regarding future leasing or
sale of the properties.
Our current strategy is to continue to
maximize the value of our assets and meet our short-term working capital needs
by continuing to manage, administer and service our existing portfolio and
develop, lease and refinance or sell an 8.5 acre retail site located in Kearny,
NJ which we have owned for many years and for which we have been designated as
developer by the Town of Kearny. However, because of the
current economic conditions, the development of the Kearny property will take
longer than originally projected. In the current economic market
there is no assurance that the project will be successful or that the
redevelopment can be completed. In addition, in order for us to
undertake the redevelopment of such property, we need to obtain construction
financing, and, additional loan and equity financing. Given current
economic conditions, there can be no assurance that any such financing will be
obtained on acceptable terms or at all.
CRITICAL
ACCOUNTING POLICIES AND ESTIMATES
There
have been no material changes to the Critical Accounting Policies and Estimates
described in our Annual Report on Form 10-K for the year ended December 31, 2009
filed with the SEC on March 31, 2010.
RESULTS
OF OPERATIONS
Three Months Ended March 31,
2010 Compared to Three Months Ended March 31, 2009
We had
income or losses from continuing operations from each of our business segments
as follows:
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Residual interests segment
|
|
$
|
1,043
|
|
|
$
|
846
|
|
|
Real estate segment
|
|
|
(669
|
)
|
|
|
(562
|
)
|
|
Corporate / other
|
|
|
2
|
|
|
|
86
|
|
|
Income from continuing
operations
|
|
$
|
376
|
|
|
$
|
370
|
|
Interest
income on mortgage loans from affiliates decreased to $486
as a result of principal amortization on certain mortgage
loans. Interest expense decreased as a result of anticipated loan
maturities and the application of a greater percentage of each payment to
mortgage principal balances.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Interest on mortgage loans
|
|
$
|
486
|
|
|
$
|
528
|
|
|
Interest expense on underlying
mortgages
|
|
$
|
50
|
|
|
$
|
64
|
|
Interest
income on residual interest increased due to favorable changes in future cash
flow which are recognized as interest over the remaining life of the retained
interests. Interest expense on the related notes payable decreased as a result
of principal amortization.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Interest income on residual
interests
|
|
$
|
1,592
|
|
|
$
|
1,542
|
|
|
Interest expense on related notes
payable
|
|
$
|
542
|
|
|
$
|
689
|
|
Net
rental income increased primarily as a result of increased gross rental income
and lower expenses on vacant properties held for lease.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Net rental income from
others
|
|
$
|
128
|
|
|
$
|
66
|
|
|
Gross rental income from
others
|
|
$
|
320
|
|
|
$
|
306
|
|
General
and administrative expenses decreased primarily as a result of a decrease in the
number of employees and a reduction in overall employment costs.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
General and administrative
|
|
$
|
480
|
|
|
$
|
584
|
|
The asset
servicing fee paid to NPO Management LLC, the entity which is engaged by us to
provide us with management services, is calculated pursuant to the terms of the
Asset Servicing Agreement, which calls for an adjustment to reflect changes in
the consumer price index.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Asset servicing fee
|
|
$
|
195
|
|
|
$
|
195
|
|
Legal and
professional fees increased primarily as a result of hiring RESIG as our
outsourced accounting function and a change in our independent registered public
accounting firm during the fourth quarter of 2009.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Legal and professional
|
|
$
|
214
|
|
|
$
|
73
|
|
We
recorded an additional provision for losses on our mortgage portfolio of $100
for the three months ended March 31, 2009 due to underlying changes in the value
of the collateral. No such loss was recorded for the three months
ended March 31, 2010.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Provision for loan losses
|
|
$
|
0
|
|
|
$
|
100
|
|
We
recorded a provision for impairment on our real estate portfolio of $245 for the
three months ended March 31, 2010 due to a potential transaction on the Brent,
Alabama property.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Provision for impairment
|
|
$
|
245
|
|
|
$
|
0
|
|
Interest
expense to affiliates decreased for the three months ended March 31, 2010
compared to the three months ended March 31, 2009 as a result of decreased
amount of outstanding debt owed to affiliates.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Interest expense to
affiliates
|
|
$
|
34
|
|
|
$
|
45
|
|
Interest
expense relating to other debts decreased for the three months ended March 31,
2010 as compared to the three months ended March 31, 2009 as a result of
deferred financing costs being fully amortized.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Interest expense – others
|
|
$
|
213
|
|
|
$
|
344
|
|
We
recognized $99 of deferred income tax expense for the three months ended March
31, 2010. The deferred tax impact resulted primarily from the
deferred expense related to the changes in the components of deferred tax
assets. No such deferred income tax was recognized for the three
months ended March 31, 2009.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
$
|
99
|
|
|
$
|
0
|
|
Discontinued
operations consist of the operations of business segments we consider as held
for sale or have disposed of.
|
|
|
2010
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
(Loss) gain from discontinued
operations
|
|
$
|
(50
|
)
|
|
$
|
7
|
|
Liquidity and Capital
Resources
Our cash
balance was $1,199 at March 31, 2010, compared with $1,067 at December 31,
2009. This increase was due to $574 of net cash provided by operating
activities and $1,917 of net cash provided by investing activities, offset by
$2,359 of net cash used in financing activities.
Our cash flow from operating activities
is generated principally from rental income from our ownership of real estate,
distributions in connection with our residual interests in securitized
portfolios, interest on our mortgage portfolio, management fees and transaction
and other fees received as a result of the sale and/or refinancing of
partnership properties and mortgages.
Our cash flow from investing activities
is generated primarily from principal collections on retained interests and to a
lesser extent from collections of loan receivables and net proceeds from the
sale of our Iowa Park, Texas property.
Our cash used in financing activities
consisted primarily of payments on notes payable relating to residual interests
and to a lesser extent principal payments on our debt and underlying
mortgages.
We expect that anticipated cash flow
provided by operations and other sources will be sufficient to meet our current
cash requirements through at least the next twelve months. We have in
the past and expect in the future to continue to be required to augment our cash
flow provided by operations with additional cash generated from either the sale
or refinancing of portions of our assets and/or borrowings. We
currently do not generate sufficient cash flow from operations to meet our cash
requirements or to permit us to pay a dividend on our common
stock. Excluding proceeds generated from the sale of assets, our cash
flow would have been a net decrease in cash of $30 for the three months ended
March 31, 2010. Cash flow in any given quarter is not necessarily
indicative of the cash flow from any other quarter because of the seasonality of
cash receipts and disbursements.
With respect to our residual interests,
pursuant to the terms of the purchase agreements, there are annual minimum and
maximum levels of cash flow that we are entitled to retain, after the payment of
interest and principal on the notes payable. Effective
January 1, 2010 through the final payment to the holder of the notes payable
(expected to be 2014 and 2018 for Receivables II-A and Receivables II-B,
respectively), the annual minimum and maximum levels are $1,050 and $1,150,
respectively.
Outstanding
Financings
Outstanding
loans payable as of March 31, 2010 which are scheduled to become due through
2014 are as follows:
|
Creditor
|
|
Original
Loan
Amount
|
|
Outstanding
Balance
Including Accrued Interest at
March 31,
2010
|
|
Interest Rate
|
|
Annual
Debt
Service
|
|
Maturity
|
|
Amount
due at
Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pemmil
(1)
|
|
$
2,500
|
|
$
1,162
|
|
12%
|
|
(1)
|
|
12/31/11
|
|
$
1,162
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaffiliated
Bank (2)
|
|
$
2,200
|
|
$
1,824
|
|
LIBOR
+ 4%
|
|
(2)
|
|
02/01/14
|
|
$
-0-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaffiliated
Bank (3)
|
|
$
1,500
|
|
$
1,357
|
|
6.25%
|
|
(3)
|
|
06/05/12
|
|
$
1,050
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaffiliated
Bank (4)
|
|
$
6,450
|
|
$
3,498
|
|
>of
6% or Prime +1%
|
|
(4)
|
|
01/21/11
|
|
$
3,498
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaffiliated
Bank
|
|
$
250
|
|
$
157
|
|
7.5%
|
|
$60
|
|
02/01/13
|
|
$
-0-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaffiliated
Bank (5)
|
|
$
3,800
|
|
$
3,708
|
|
LIBOR
+ 2.1%
|
|
(5)
|
|
07/01/11
|
|
$
3,598
|
|
(1)
|
Pemmil
is an affiliated entity. Loan requires payments only to the
extent of 50% of the proceeds from capital transactions. If
proceeds are insufficient to satisfy monthly interest payments, interest
is added to principal. Loan is secured by a subordinated lien
on our interest in S-2 Holdings Inc. and a first priority lien on two
mortgages.
|
|
(2)
|
Loan
is secured by first priority interest in four first mortgages and contains
a restriction on pledging mortgages for additional
debt. Requires monthly payments of interest plus a fixed
principal payment of $39.
|
|
(3)
|
Loan
requires monthly payments of interest only as well as an annual principal
payment of $100.
|
|
(4)
|
Initial
advance under the loan was $4,250 with an additional $2,200 to be advanced
upon the satisfaction of certain conditions, if at
all. Requires payments of interest only. One year
extension option subject to certain terms and
conditions.
|
|
(5)
|
Secured
by a certain building on the Owned-Site. Requires annual debt
service of approximately $292.
|
We use
derivatives to manage risks related to interest rate movements on our floating
rate debt. Interest rate swap contracts designated and qualifying as
cash flow hedges are reported at fair value. During September 2008,
the Company entered into an interest rate swap agreement related to one of its
floating rate loans. Valued separately, the interest rate swap
agreement represents a liability as of March 31, 2010, in the amount of
$148. During April 2009, the Company entered into a second interest
rate swap agreement related to another of its floating rate
loans. Valued separately, the interest rate swap agreement represents
a liability as of March 31, 2010 in the amount of $26. This value
represents the fair value of the current difference in interest paid and
received under the swap agreements over the remaining term of the
agreements. As of January 1, 2010 we decided to discontinue the use
of hedge accounting. Accordingly, changes in the fair value of
derivatives will be reported as a component of interest expense in the
consolidated statements of operations. Additionally, the balance that
existed in other comprehensive income in the Consolidated Statement of
Shareholders’ Equity as of December 31, 2009 will be amortized through the
income statement over the remaining lives of the swap transactions on a
straight-line basis. The following table summarizes the notional values of our
derivative financial instruments. The notional value provides an
indication of the extent of our involvement in these instruments on March 31,
2010, but does not represent exposure to credit, interest rate or market
risks.
|
Hedge Type
|
Notional Value
|
Rate
|
Termination Date
|
Fair Value
|
|
|
|
|
|
|
|
Interest
rate swap agreement
|
$ 3,689
|
5.94%
|
July
1, 2011
|
$ (148)
|
The
outstanding principal of the Note is payable in monthly installments of $5
beginning on August 1, 2008 and continuing on the first day of each month
thereafter. Annual debt service is approximately $292. The
final monthly installment of the Note is due and payable at maturity on July 1,
2011 or before, at the option of the Bank upon any defaults after the expiration
of all applicable notice and cure periods as specified therein.
|
Hedge Type
|
Notional Value
|
Rate
|
Termination Date
|
Fair Value
|
|
|
|
|
|
|
|
Interest
rate swap agreement
|
$ 1,814
|
6.09%
|
February
1, 2014
|
$ (26)
|
The
outstanding principal of the Note is payable in monthly installments of $39
beginning on June 1, 2009 and continuing on the first day of each month
thereafter. The final monthly installment of the Note is due and
payable at maturity on February 1, 2014 or before, at the option of the Bank
upon any defaults after the expiration of all applicable notice and cure periods
as specified therein.
IMPACT OF INFLATION AND
CHANGES IN INTEREST RATES
Our
portfolio of mortgage loans made to Affiliated Limited Partnerships consists
primarily of loans made at fixed rates of interest. Therefore,
increases or decreases in market interest rates are generally not expected to
have an effect on our earnings. Other than as a factor in determining
market interest rates, inflation has not had a significant effect on our net
income.
ITEM
3.
QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
We are a
smaller reporting Company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 (the “Exchange Act”) and are not required to provide the information
under this item.
ITEM
4T.
CONTROLS AND
PROCEDURES
|
(a)
|
Disclosure Controls
and Procedures
|
Disclosure
controls and procedures are controls and other procedures that are designed to
ensure that information required to be disclosed in company reports filed or
submitted under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commission’s
rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed in our reports filed under the Exchange Act, is accumulated and
communicated to management, including our principal executive officer and
principal financial officer, as appropriate, to allow timely decisions regarding
required disclosure.
As
required by Rule 13a-15 under the Exchange Act, we are required to carry out an
evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures as of the end of the period covered by this
report. This evaluation was carried out with the participation of our
principal executive officer and principal financial officer. Based
upon that evaluation, our principal executive officer concluded that our
disclosure controls and procedures were effective at a reasonable assurance
level such that the information relating to us and our consolidated subsidiaries
required to be disclosed in our Exchange Act reports (i) is recorded, processed,
summarized and reported within the time periods specified in the SEC’s rules and
forms, and (ii) is accumulated and communicated to our management, including our
principal executive officer and principal financial officer, as appropriate to
allow timely decisions regarding required disclosure
.
|
(b)
|
Changes in Internal
Control Over Financial
Reporting.
|
There has
been no change in our internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) during
the period ended March 31, 2010 that has materially affected, or is reasonably
likely to materially affect, our internal control over financial
reporting.
PART
II. OTHER INFORMATION
Item
6.
Exhibits
Exhibits
required by Item 601 of Regulation S-K are filed herewith or incorporated herein
by reference and are listed in the attached Exhibit Index.
EXHIBIT
INDEX
|
3.
|
ARTICLES
OF INCORPORATION AND BY-LAWS.
|
|
(a)
|
DVL’s
Certificate of Incorporation, filed March 28, 1977 (Incorporated by
reference to Exhibit 6(d) to DVL’s Form S-1 Registration Statement No.
2-58847 dated April 28, 1977.)
|
|
(b)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed July 13,
1977 (Incorporated by reference to Exhibit 6(e) to Amendment No. 1 to
DVL’s Form S-1 Registration Statement No. 2-58847 dated August 25,
1977.)
|
|
(c)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed August 3,
1982. (Incorporated by reference to Exhibit 3(c) to DVL’s Form
10-K for the fiscal year ended December 31,
1982.)
|
|
(d)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed May 27,
1983. (Incorporated by reference to Exhibit 3(d) to DVL’s Form
10-K for the fiscal year ended December 31,
1983.)
|
|
(e)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed July 24,
1987. (Incorporated by reference to Exhibit 3(e) to DVL’s Form
10-K for the fiscal year ended December 31,
1987.)
|
|
(f)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed December
20, 1983. (Incorporated by reference to DVL’s Form 10-K for the fiscal
year ended December 31, 1993.)
|
|
(g)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed December
4, 1995. (Incorporated by reference to DVL’s proxy statement
dated October 13, 1995 – Exhibit
A.)
|
|
(h)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed September
17, 1996. (Incorporated by reference to DVL’s proxy statement
dated July 31, 1996 – Exhibit I.)
|
|
(i)
|
DVL’s
Certificate of Amendment to Certificate of Incorporation, filed February
7, 2000. (Incorporated by reference to DVL’s Form 10-K for the
fiscal year ended December 31,
1999.)
|
|
(j)
|
DVL’s
By-Laws, as in full force and effect at all times since March 28,
1977. (Incorporated by reference to Exhibit 3(c) to DVL’s Form
10-K for the fiscal year ended December 31,
1980.)
|
|
(k)
|
DVL’s
First Amendment to By-Laws dated as of January 1,
1994. (Incorporated by reference to Exhibit 3(d) to DVL’s Form
10-K for the fiscal year ended December 31,
1995.)
|
|
(l)
|
DVL’s
Second Amendment to By-Laws, effective September 17,
1996. (Incorporated by reference to DVL’s proxy statement dated
July 31, 1996 – Exhibit J.)
|
|
(m)
|
DVL’s
Third Amendment to the By-Laws, effective February 1,
2000. (Incorporated by reference to DVL’s Form 10-K for the
fiscal year ended December 31,
1999.)
|
|
10.1
|
Stipulation
of Settlement of IN RE KENBEE LIMITED PARTNERSHIP LITIGATION
dated August 12, 1992. (Incorporated by reference to Exhibit
10(b)(25) to DVL’s Form 10-K for the fiscal year ended December 31,
1995.)
|
|
10.2
|
Stipulation
of Partial Settlement and Order IN RE DEL-VAL FINANCIAL CORPORATION
SECURITIES LITIGATION Master File #MDL872. (Incorporated by
reference to Exhibit 10(b)(28) to DVL’s Form 10-K for the fiscal year
ended December 31, 1995.)
|
|
10.3
|
Asset
Servicing Agreement between DVL, PSC, KENBEE Realty and NPO dated as of
March 27, 1996. (Incorporated by reference to Exhibit 10(b)(34)
to DVL’s Form 10-K for the fiscal year ended December 31,
1995.)
|
|
10.4
|
Asset
Servicing Agreement between DVL and NPO. (Incorporated by
reference to DVL’s Proxy Statement dated July 31, 1996 - Exhibit
C.)
|
|
10.5
|
Common
Stock Warrant issued by DVL to NPO. (Incorporated
by reference to DVL’s Proxy Statement dated July 31, 1996 -
Exhibit F.)
|
|
10.6
|
DVL
1996 Stock Option Plan. (Incorporated by reference to DVL’s
Proxy Statement dated July 31, 1996 – Exhibit
K.)
|
|
10.7
|
Amendment
to DVL 1996 Stock Option Plan effective February 1, 2000. (Incorporated by
reference to DVL’s Form 10-K for the fiscal year ended December 31,
1999.)
|
|
10.8
|
Promissory
Note dated as of October 20, 1997, in the original Principal amount of
$1,760,000 from DVL to Blackacre. (Incorporated by reference to
Exhibit 10.2 to DVL’s Form 10-Q for the quarter ended September 30,
1997.)
|
|
10.9
|
Subordination
Agreement, dated as of October 20, 1997 among DVL, Blackacre, NPM, and
NPO. (Incorporated by reference to Exhibit 10.3 to DVL’s Form
10-Q for the quarter ended September 30,
1997.)
|
|
10.10
|
Agreement
among Members dated April 10, 1998, by and among Blackacre, PNM, Pemmil
and DVL. (Incorporated by reference to DVL’s Form 10-K for the
fiscal year ended December 31,
1998.)
|
|
10.11
|
Management
Services Agreement dated June 1, 1998, by and between DVL and PBD
Holdings, L.P. (“PBD”). (Incorporated by reference to DVL’s
Form 10-K for the fiscal year ended December 31,
1998.)
|
|
10.12
|
Loan
Agreement, Promissory Note and Pledge, Collateral Agreement and Security
Agreement, each dated as of March, 2000, each relating to a loan from
Pennsylvania Business Bank to DVL in the original principal amount of
$1,000,000. (Incorporated by reference to DVL’s Form 10-K for
the quarter ended June 30, 2000.)
|
|
10.13
|
Term
Loan Note and Term Loan Agreement, each dated as of March, 2000, each
relating to a loan from Bank Philadelphia to DVL in the original principal
amount of $1,450,000. (Incorporated by reference to DVL’s Form
10-Q for the quarter year ended June 30,
2000.)
|
|
10.14
|
First
Amendment to Loan Agreement, Pledge Agreement, Promissory Note and other
documents dated August 2000, relating to a loan from Pennsylvania Business
Bank to DVL, Inc. in the original principal amount of
$1,000,000. (Incorporated by reference to DVL’s Form 10-Q for
the quarter ended September 30,
2000.)
|
|
10.15
|
Purchase
Agreement, dated April 27, 2001, by and among J.G. Wentworth
Receivables II LLC, Receivables II-A LLC, Receivables II-A Holding
Company, LLC, J.G. Wentworth S.S.C., Limited Partnership, J.G. Wentworth
Management Company, Inc., S2 Holdings, Inc., and DVL, Inc. for the
purchase of residual interests in securitized
portfolios. (Incorporated by reference to DVL’s Form 8-K dated
May 9, 2001.)
|
|
10.16
|
Non-Negotiable,
Secured Purchase Money Promissory Note dated April 27, 2001 in the
original principal amount of $22,073,270 payable to the order of J.G.
Wentworth S.S.C., Limited Partnership from S2 Holdings, Inc. (Incorporated
by reference to DVL’s Form 8-K dated May 9,
2001.)
|
|
10.17
|
Non-Negotiable,
Secured Purchase Money Promissory Note dated April 27, 2001 in the
original principal amount of $3,252,730 payable to the order of J.G.
Wentworth S.S.C., Limited Partnership from S2 Holdings, Inc. (Incorporated
by reference to DVL’s Form 8-K dated May 9,
2001.)
|
|
10.18
|
Guaranty
and Surety Agreement dated April 27, 2001 by and from DVL, Inc. in favor
of J.G. Wentworth S.S.C., Limited Partnership from S2 Holdings,
Inc. (Incorporated by reference to DVL’s Form 8-K dated May 9,
2001.)
|
|
10.19
|
Common
Stock Warrant dated April 27, 2001. (Incorporated by Reference
to DVL’s Form 8-K dated May 9,
2001.)
|
|
10.20
|
Purchase
Agreement, dated as of August 20, 2001, by and among J.G. Wentworth
Receivables II LLC, Receivables II-B LLC, Receivables II-B Holding Company
LLC, J.G. Wentworth S.S.C. Limited Partnership, J.G. Wentworth Management
Company, Inc., S2 Holding, Inc. and DVL, Inc. for the purchase of residual
interests in securitized portfolios. (Incorporated by reference
to DVL’s Form 8-K dated August 28,
2001.)
|
|
10.21
|
Non-Negotiable,
Secured Purchase Money Promissory Note dated as of August 15, 2001 in the
original principal amount of $7,931,560.00 payable to the order of J.G.
Wentworth S.S.C., Limited Partnership from S2 Holdings, Inc. (Incorporated
by reference to DVL’s Form 8-K dated August 28,
2001.)
|
|
10.22
|
Non-Negotiable,
Secured Purchase Money Promissory Note dated as of August 15, 2001 in the
original principal amount of $1,168,440.00 payable to the order of J.G.
Wentworth S.S.C., Limited Partnership from S2 Holdings, Inc. (Incorporated
by reference to DVL’s Form 8-K dated August 28,
2001.)
|
|
10.23
|
Guaranty
& Surety Agreement dated as of August 20, 2001 by and from DVL, Inc.
in favor of J.G. Wentworth S.S.C., Limited
Partnership. (Incorporated by reference to DVL’s Form 8-K
dated
|
August
28, 2001.)
|
10.24
|
Pledge
Agreement, dated as of August 20, 2001 by S2 Holdings, Inc. for the
benefit of J.G. Wentworth S.S.C. Limited Partnership. (Incorporated by
reference to DVL’s Form 8-K dated August 28,
2001.)
|
|
10.25
|
Common
Stock Warrant dated as of August 15, 2001. (Incorporated by
reference to DVL’s Form 8-K dated August 28,
2001.)
|
|
10.26
|
Client
Service Agreement between the Company and Compensation Solutions, Inc.
dated March 28, 2003. (Incorporated by reference to DVL’s Form 10-Q for
the quarter ended March 31, 2003.)
|
|
10.27
|
$1,450,000
Promissory Note issued by DVL, Inc. in favor of Pennsylvania Business
Bank, dated April 28, 2004. (Incorporated by reference to Exhibit 10.1 to
DVL’s Form 10-Q for the quarter ended June 30,
2004.)
|
|
10.28
|
Loan
Agreement between DVL, Inc. and Pennsylvania Business Bank dated April 28,
2004. (Incorporated by reference to Exhibit 10.2 to DVL’s Form
10-Q for the quarter ended June 30,
2004.)
|
|
10.29
|
Promissory
Note, dated December 28, 2004, issued by DVL Mortgage Holdings, LLC and
DVL, Inc. in favor of Harleysville National Bank and Trust
Company. (Incorporated by reference to Exhibit 10.29 to DVL’s
Form 10-KSB filed for the year ended December 31,
2005.)
|
|
10.30
|
Assignment
Agreement, dated as of December 28, 2004, between Rumson Mortgage Holdings
LLC and DVL Mortgage Holdings LLC, Inc. (Incorporated by
reference to Exhibit 10.30 to DVL’s Form 10-KSB filed for the year ended
December 31, 2005.)
|
|
10.31
|
Loan
Agreement, dated December 28, 2004, by and among Harleysville National
Bank and Trust Company and DVL Mortgage Holdings LLC. (Incorporated by to
Exhibit 10.31 to DVL’s Form 10-KSB filed for the year ended December 31,
2005.)
|
|
10.32
|
Stock
Repurchase Agreement dated March 16, 2007 between DVL, Inc., Blackacre
Bridge Capital, L.L.C. and Blackacre Capital Group, L.P. (Incorporated by
reference to Exhibit 10.33 to DVL’s Form 10-KSB for fiscal year ended
December 31, 2006.)
|
|
10.33
|
Loan
and Security Agreement, dated June 5, 2006 by and between DVL, Inc. and
First Penn Bank. (Incorporated by reference to Exhibit 10.1 to DVL’s Form
10-QSB filed on August 14, 2006.)
|
|
10.34
|
Change
in Terms Agreement, dated September 1, 2006 by and between DVL, Inc. and
Pennsylvania Business Bank. (Incorporated by reference to Exhibit 10.1 to
DVL’s Form 10-QSB filed on November 14,
2006.)
|
|
10.35
|
Agreement
between the Town of Kearny, New Jersey and DVL, Inc. approved on October
24, 2006. (Incorporated by reference to Exhibit 10.34 to DVL’s Form 10-KSB
for the fiscal year ended December 31,
2006.)
|
|
10.36
|
Agreement
of Sale dated April 27, 2006 by and between DVL, Inc. and 354 Broadway
Associates, LLC. (Incorporated by reference to Exhibit 10.38 to DVL’s Form
10-KSB for the fiscal year ended December 31,
2006.)
|
|
10.37
|
First
Amendment of Agreement of Sale dated June 28, 2006 by and between DVL,
Inc. and 354 Broadway Associates, LLC. (Incorporated by reference to
Exhibit 10.39 to DVL’s Form 10-KSB for the fiscal year ended December 31,
2006.)
|
|
10.38
|
Second
Amendment of Agreement of Sale dated September 25, 2006 by and between
DVL, Inc. and 354 Broadway Associates, LLC. (Incorporated by reference to
Exhibit 10.40 to DVL, Inc.’s Form 10-KSB for the fiscal year ended
December 31, 2006.)
|
|
10.39
|
Loan
Extension Agreement between Pennsylvania Business Bank and Del Toch, LLC,
Delborne Land Company LLC, and Delbrook Holding, LLC dated March 2,
2007. (Incorporated by reference to Exhibit 10.1 to DVL’s Form
10-QSB for the quarter ended March 31,
2007.)
|
|
10.40
|
Loan
Extension Agreement between Pennsylvania Business Bank and Del Toch, LLC,
Delborne Land Company, LLC and Delbrook Holding LLC, dated June 1, 2007.
(Incorporated by reference to Exhibit 10.1 to DVL’s Form 10-QSB for the
quarter ended June 30, 2007.)
|
|
10.41
|
Construction
Loan Agreement dated August 2007 between DVL Kearny Holdings LLC, CapMark
Bank, Urban Development Fund II LLC, and Paramount Community Development
Fund. (Incorporated by reference to Exhibit 10.43 to DVL’s Form
10-KSB for the year ended December 31,
2007.)
|
|
10.42
|
Asset
Servicing Extension Agreement dated October 31, 2007 between DVL, Inc.,
Professional Services Corporation, K.M. Realty Corporation, and NPO
Management, LLC. (Incorporated by reference to Exhibit 10.44 to
DVL’s Form 10-KSB for the year ended December 31,
2007.)
|
|
10.43
|
First
Amendment to Lease dated August 10, 2007 to that certain lease dated
November 7, 2002 between DVL, Inc. and Amstad Property, Inc. (Incorporated
by reference to Exhibit 10.45 to DVL’s Form 10-KSB for the year ended
December 31, 2007.)
|
|
10.44
|
Construction
Loan Agreement between Capmark Bank, Urban Development Fund II, LLC,
Paramount Community Development Fund, LLC, and DVL Kearny Holdings, LLC
(dated August 14, 2007). (Incorporated by reference to DVL’s
Form 10-QSB for the quarter ended September 30,
2007.)
|
|
10.45
|
Asset
Servicing Extension Agreement between DVL, Inc., Professional Services
Corporation, KM Realty Corporation and NPO Management, LLC dated October,
2007. (Incorporated by reference to DVL’s Form 10-QSB for the quarter
ended September 30, 2007.)
|
|
10.46
|
Redeveloper
Agreement dated December 11, 2007 between DVL, Inc., DVL Kearny Holdings,
LLC, and the Town of Kearny, New Jersey. (Incorporated by reference to
DVL’s Current Event Report on Form 8-K dated December 11,
2007.)
|
|
10.47
|
Developer
Services Agreement between DVL, Inc., P&A Associates, and Pemmil
Management, LLC. (Incorporated by reference to DVL’s Current Event Report
on Form 8-K dated December 11,
2007.)
|
|
10.48
|
Mortgage
Note for the principal amount of $3,800,000 in favor of Delbrook Holding,
LLC. (Incorporated by reference to DVL’s Form 10-Q for the period ended
June 30, 2008.)
|
|
10.49
|
Amendment
No. 2 to the Construction Loan Agreement. (Incorporated by Reference to
DVL’s Form 10-Q for the period ended September 30,
2008.)
|
|
10.50
|
Pledge
and Security Agreement dated as of August 1,
2008. (Incorporated by reference to DVL’s Form 10-Q for the
period ended September 30, 2008.)
|
|
10.51
|
Amendment
No. 2 to the Loan and Security Agreement with Pemmil Funding, LLC, dated
November 10, 2008. (Incorporated by reference to DVL’s Form
10-Q for the period ended September 30,
2008.)
|
|
10.52
|
Mortgage,
Security Agreement and Agreement of Leases and Rents dated January 21,
2009 by DVL Kearny Holdings LLC in favor of Signature
Bank.
|
|
10.53
|
Guaranty
dated January 21, 2009 by DVL, Inc. to Signature
Bank.
|
|
10.54
|
Amended
and Restated Loan and Security Agreement, dated as of December 31, 2009,
by and between DVL, Inc. and Pemmil Funding, LLC. (Incorporated by
reference to DVL’s Form 10-K for the year ended December 31,
2009.)
|
|
31.1
|
Chief
Executive Officer’s Certificate, pursuant to Section 302 of The
Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Chief
Financial Officer’s Certificate, pursuant to Section 302 of The
Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification
of Chief Executive Officer and Chief Financial Officer, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|
Pursuant
to the requirements 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.
|
|
DVL,
Inc.
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/
Neil Koenig
|
|
|
|
Neil
Koenig, Executive Vice President and
Chief
Financial Officer
|
May 14,
2010
