ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
You should read the following discussion together with the financial statements and the related notes included elsewhere in this Annual Report on Form 10-KSB. This discussion contains forward-looking statements that are based on management's current expectations, estimates and projections about the Company's business and operations. The Company's actual results may differ materially from those currently anticipated and expressed in such forward-looking statements as a result of a number of factors, including those discussed in this Report on Form 10-KSB.

---

Table of Contents

Results of Operations
Year Ended December 31, 2007 and 2006 The Company had a net loss of approximately ($684,040) or ($0.37) per share of Class A Common Stock for the year ended December 31, 2007, compared to net income of approximately $3,681,459 or $1.99 per share of Class A Common Stock for the year ended December 31, 2006. The decrease in net income for the year ended December 31, 2007 was primarily attributable to the recognition of income in 2006 on sale of property of $3,567,735. On July 1, 2006, the Company received $1,783,208 from the maker of its mortgage note receivable as a payment to release 80 acres of the 280 acres securing the loan. The Company recorded a gain on real estate sale of $3,567,735, the balance of income deferred at the time that the promissory note was originally received, as the payment received now allows for the treatment of the sale under the full accrual method. In addition, on July 10, 2006, the Company purchased an additional 1.76% interest in its mortgage note receivable for a total consideration of approximately $70,500. This purchase increased the Company's interest in the mortgage note receivable from 86.47% to 88.23%. Subsequent to December 31, 2006, the Company sold its interest in the note receivable to a related party for $3,411,346.
The Company's expenses increased to $420,753 in 2007, as compared to $322,760 in 2006. This increase was the result of an increase in professional services of approximately $162,000 and general and administration expenses of approximately $43,000, partially offset by a decrease of $105,506 in reserves for loss on sale. The increases in professional services can be attributed to expenses associated with the proposed Transactions.
Net cash used for operating activities in 2007 totaled ($227,637) as contrasted to net cash provided by operating activities of $181,042 in 2006. Net cash provided by investing activities in 2007 and 2006 were $3,534,207 and $1,262,247, respectively. Net cash used for financing activities in 2007 and 2006 were $1,851,025 and $740,400, respectively. Liquidity and Capital Resources
At December 31, 2007, cash and cash equivalents and available for sale securities were $2,229,538 and $1,591,033, respectively. The Company currently has no commitments for any material capital expenditures and does not anticipate any such expenditures in the foreseeable future. The Company believes its cash and cash equivalents and the ability to liquidate trading securities provides sufficient liquidity in the event any material capital expenditure or expense in connection with the contemplated Transactions becomes necessary. Off Balance Sheet Arrangements
We have no off balance sheet arrangements. Dividends
In 2006 and 2007, the Company declared and paid the cash distributions described above in Item 5. The Company has agreed under the Master Agreement not to declare or pay any further dividends prior to the consummation of the Transactions.
In order for the Company to maintain its status as a qualified REIT, it must, among other requirements, pay out in the form of dividends at least 95% of its taxable income (excluding capital gains) to shareholders and must pay taxes at corporate tax rates on capital gains or distribute at least 95% of capital gains as dividends to shareholders. If the Company fails to maintain its status as a REIT, the Company would no longer be entitled to deduct from its federal taxable income (and not pay federal taxes on) dividends paid to shareholders.

---

Table of Contents