Free Motion for Summary Judgment - District Court of Arizona - Arizona

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C&$9 2 ZO4-CV-OO384—RC)S [)OCUlT#@¤{ Fi|9d `I2/18/2005 PéQé‘1_

` SECUPJTIES AND SXCHANGE COHMISSION
WASHINGTON, D.C. 20549
1-·0ru·11o-x ` · .. T " i` 7
1 DC] ANNUAL REPORT PURSUANT IU SECTION 13 OR 15(ci) OF THE SECURITIES EXCHANGE .
_ ACI OF 1934
_ For the fiscal year ended December 31, 2002 =
OR n · h
[ ] TRANSITION REPORT PURSUANT TD SECTION 13 OR 15(C`1) DF THE SECURITIES
EXCHANGE ACT OF 1934 _
· For the transition period from to
Commission Pile Number 1-9977 - V
Heritage Corporation
(EXACT NAME OF REGISTRRNT AS SPECIFIED IN ITS CHARTER)
Maryland 86-0611231
(STATE OR DTHZRR JURISDICIIOH OF (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFIQTIOH N0-)
8501 E. Princess Drive, Suite 290 85255
Scottsdale, Arizona (ZIP COKE)
(ADDRESS OP PRINCIPAL ED{ECUTIVE OFFICES)
' (480) 609-3330 ‘ l
(R.EGIsTRAN’r•s TELEPHONE NUMBER, INCLUDING AREA CODE)
Securities registered pursuant to Section 12 (b) of the Act:
Common Stock, $.01 par value New York Stock Exchange
Securities registered pursuant to Section 12 (g) ol the Act: NCNE
V Indicate by check mark whether the registrant: (1) has filed all reports
required to he filed by Section 13 or 15(d) of the Securities Exchange Act ot
( 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. Yes (I] No [ ]- -
Indicate by check mark it disclosure of delinquent Iztlers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
- best of registrant': knowledge, in definitive proxy or infomation statements
' incorporated by reterence in Part III of this Form 10-K or any amendment to this
Form 10—K. [ ]
Indicate by check mark whether the registrant is an accelerated filu (as
defined in Rule 12b-2 of the lbcchnnge Act). Yes [X] H0 [ ]. _
The aggregate market value ot common stock held by n0n—aff:L11nte¤ of the l
registrant (10,215,050 shares) as of June 28, 2002, was $466,317,03;%, based on
the closing sales price par share as_reported by the New York Stock Bcchange on _
_ such date. The aggregate market value of common) stock hcld by n0n·-affiliates of
the registrant (9,590,758 shares) as of March 14, 2003, was $309,877,39]., based
on the closing sales price per share as reported by the New York Stock Exchange
on such date. For purposes of these computations, all ucecutive officers and
directors of the registrant have been deemed to be affiliates.
The number of shares outstanding of the reg1strant's comnon stock on March 14,
· 2003 was 11,93B,E§4. ‘ '
DOCUMENTS INCORPORATED BY REFERENCE
A Portions from the reg1straut's Proxy Statement relating to the Annual Meetling of
Stockholders to be held on Hay 21, 2003 have been incorporated bytreference into
_ Part III, Items 10. 11. 12 and 13-
L' ' A
· Dgpgof I . ,6 CL .
1 ` · 1'1‘€5
· . 1 _ Debra R\995 TO
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competitors. In addition, we are cournitted to achieving the highest level of '
customer satisfaction as an integral part of our competitive ntrategy. As part
of the sales process, ous: experienced sales personnel keep customers iniomed oi
( their home'}: construction progress. After delivery, our customer care _
departments respond to honebuyerr questions and warranty matters.
PRODUCTS ` l
__ vp _ I Our homes range from ~first—t1me purchasemto :em:1.?cn1:tom·1u:€ury; with base. -· » `iv ·‘T4 ‘~-Y · - · l
prices ranging from $92,000 to $910, 000. A summary of activity by state and
product type as of and for the year ended December 31, 2002, follows (dollars in
_ thousands) : '
N'UHBE.R AVERAGE ` · NUPBE OP
DF HOMES CLOSING HOMES IN DOLLAR VALUE HOME SITES RIé'.l']VE
. CLOSED PRICE BACKLDG OP B¤cx1.0G R.¤·Ux.DiI1¤2(1l CDPDQJNITIBS
Texas — First-Lime -- $ »— 5 5 AQQ 354 1
Texas ·-· Hove-up 2,¤73 183 1,055 2D7,421 BAS} so
Texas - Luxury 17 42E 15 10,634 97 ‘. 3
Azizma -·Ag¤ Restricted 1¤7 203 vs · 15,176 7,s¤a···‘ ·· · 4
Axizcmn — First-time . i45 . 110 ` _ ` fl BSB _ ,338. . 1
` Arircnn e Hove-i.1p_ 1,061 I. {I3 A I 326 BB,194 3,573 18 ’
Arizona - Luxury · 123 641 · 57 39,347 252 6
Qslitfornia - H¤vvc—·up sw :97 279 1:111,620 1,745 7
California; - Luxury 54 574 54 215,307 654 3
· Nevada — M¤ve—up 155 211 Jus 37,7!I3 2,1I3 5
Total 4,574 - 5 243 2,070 $537,764 25,066 gun
(1) 'Hcmge Sites Rema:Ln:Lng' in the estimated ntmxber of homes that could be built _
both on the remaining lotp available for sale and land to be developed into
lots. _
LAND AKDUISITION AND DEVELOPMENT V
' We typically option or purchase land only after necessary entitlements have
been obtained so that development or construction may begin as market conditlonn
dictate. The term "ent;ltlenenQ;¤" refers to development agreements, tentative
maps or recorded plats, depending on the jurisdiction within which the' land 1¤
. located. Dntitlementn generally give the developer the right to obtain building
( _ permits upon compliance with conditions that are dzdinnrlly within the
_ developewfs control. Even though entitlements are usually obtained betore land
` is purchased, va are still required to secure a variety of other governmental
approval: and peru-.it:·. during ·deve1¤p=nent. The pxocenzs oi obtaining auch
approvals and pex‘m.1.t.i can mlbitantially delay the development proqesn. For this -
reauon, ve may coneider, on a limited basin, purchasing unentitled property in
the future bhen we can do no in a ~vnaxmex‘ conslstent 'with 0[.\1' business strategy.
Although hi-ntorically we have generally developed parcels ranging from 100 to
3·0D lots, ln order to achieve and maintain an adequate inventory of lots, we are
beginning to purchase larger parcels, in some canes wiith a joint venture
. partner- _
We select land for development based upon a variety of factors, including:
• internal and external demographic and marketing atudzles;
* project suitability, which generally means developments with fewer
than 300 1¤\:¤; ; l
• suitability tor development generally wirihin a one to four-year time
period from the beginning of the development process to the delivery
_ ot the last home; _ .
* financial review an to the feasibility of the pxoponed project, .
1 including projected profit margins, returns on capital employed, and
the capital payback period; ·
_ ' the ability bo secure governmental approvals and entitlements;
* results of environmental and legal due diligence; ‘
* proximity to local Lratfic corridors and amenities; and .
* mamagement': judgment as to the real estate market and economic
_ _ trends, and our experience in particular markets- · · — · ·~~
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