<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D. C. 20549

                                  FORM 10-KSB
(Mark One)
(X)      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the fiscal year ended              December 31, 2001
                                   --------------------------------------------

( )      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the transition period from                   to
                                        -----------------    ------------------

         Commission file number                     1-6471
                                -----------------------------------------------

                                PGI INCORPORATED
-------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)
            Florida                                           59-0867335
-------------------------------------------------------------------------------
(State or other jurisdiction of                       (IRS Employer Ident. No.)
 incorporation or organization)

212 S. Central, Suite 100;          St. Louis, Missouri          63105
-------------------------------------------------------------------------------
        (Address of principal executive offices)               (Zip Code)

Issuer's Telephone Number, including area code:      (314)    512-8650
                                                ---------------------------

Securities registered pursuant to Section 12 (b) of the Exchange Act:
                                                    Name of each Exchange
         Title of Each Class                        on which Registered
-------------------------------------         ---------------------------------
                  None                                       None
                  None                                       None

Securities registered pursuant to Section 12 (g) of the Exchange Act:

Common Stock, Par Value $.10 per share
6% Convertible Subordinated Debentures due 1992

         Check whether the Issuer (1) has filed all reports required to be
filed by Section 13 or 15 (d) of the Exchange Act during the past 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    X   No
                 -----      -----

         Check if there is no disclosure of delinquent filers pursuant to
Item 405 of Regulation S-B not contained in this form, and no disclosure
will be contained, to the best of the registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of
this Form 10-KSB or any amendment to this Form 10-KSB. (X)

         State the issuer's revenues for its most recent fiscal year $159,000.
                                                                     --------

         The aggregate market value of voting stock held by non-affiliates
of the registrant can not be determined. See page 4 of Form 10-KSB.

         State the number of shares outstanding of each of the Issuer's
classes of common equity as of the last practicable date.

         As of April 15, 2002, 5,317,758 shares of Common Stock $.10 par value
         ---------------------------------------------------------------------
were outstanding.
----------------

The Index to Exhibits is located on pages 38 to 42 of this report.


<PAGE>
<PAGE>

                                PGI INCORPORATED AND SUBSIDIARIES
                                       FORM 10 - KSB - 2001
                                Contents and Cross Reference Index
<TABLE>
<CAPTION>
Part     Item                                                                    Form 10-KSB
No.      No.      Description                                                            Page No.
---      ----     -----------                                                            --------
<S>      <C>      <C>                                                                    <C>
  I       1       Description of Business
                     General                                                                 3
                     Recent Developments                                                     3
          2       Description of Property                                                    4
          3       Legal Proceedings                                                          4
          4       Submission of Matters to a Vote of Security Holders                        4

 II       5       Market for Common Equity and Related
                     Stockholder Matters                                                     4
          6       Management's Discussion and Analysis or Plan of
                     Operation                                                             5 - 10

          7       Financial Statements                                                    11 - 30
          8       Changes in and Disagreements with Accountants on
                  Accounting and Financial Disclosure                                      30

III       9       Directors, Executive Officers, Promoters and Control
                     Persons; Compliance with Section 16 (a) of the Exchange Act            31
         10       Executive Compensation                                                  31 - 32
         11       Security Ownership of Certain Beneficial Owners and
                  Management                                                              32 - 33
         12       Certain Relationships and Related Transactions                          33 - 35

 IV      13       Exhibits and Reports on Form 8-K                                          36

Signatures                                                                                  37

Exhibit Index                                                                             38 - 42
</TABLE>



<PAGE>
<PAGE>

                                   PART I
                                   ------

Item 1.           Description of Business
-------           -----------------------
GENERAL

         As used in this Annual Report on Form 10-KSB, the "Company" refers,
unless the context otherwise requires, to PGI Incorporated and its
subsidiaries. The Company's executive offices are at 212 S. Central, Suite
100, St. Louis, Missouri, 63105, and its telephone number is (314) 512-8650.

         The Company was founded in 1958, and up until the mid 1990's was in
the business of building and selling homes, developing and selling homesites
and selling undeveloped or partially developed tracts of land. In the last
5 years the Company's business focus and emphasis changed substantially as it
concentrated its sales and marketing efforts almost exclusively on the
disposition in bulk of its undeveloped, platted, residential real estate.
This change was prompted by its continuing financial difficulties due to the
principal and interest owed on its debt.

         Presently, the Company's remaining inventory mainly consists of
370 acres located in Hernando County, Florida. In addition, the Company has
been actively pursuing collection on delinquent contract receivables from
homesite sales. The Company owns approximately 34 lots, mostly located in
Citrus County, Florida which are listed for sale.

         As of January 1, 2002 the Company had no employees, all services
provided to the Company are through contract services.

RECENT DEVELOPMENTS

         With the completion of the Suncoast Expressway to Highway 98 in
2001 and the anticipated further extension of the expressway beyond Highway
98 in coming years, the Company believes the 370 acres located in Hernando
County, Florida may become more marketable because of the property's close
proximity to the interchange of the Suncoast Expressway with Highway 98.

         The Company has been actively pursuing repossession of lots with
delinquent contracts receivable. In the past year, 6 lots were reacquired by
obtaining quit claim deeds or through foreclosure, and out of the total
inventory of lots owned, 12 were sold. The Company is in the process of
foreclosing on 10 additional lots.


                                     -3-


<PAGE>
<PAGE>

Item 2.           Description of Property
-------           -----------------------

         The Company's primary investment in properties relates to its
Sugarmill Woods project comprising 370 acres of unimproved land located in
Hernando County, Florida near the interchange of the Suncoast Expressway and
Highway 98. Approximately 40 acres of the property have been approved for
commercial use by the Hernando County Commission. The Company generally has
fee simple title to this property, but substantially all of the Company's
properties are encumbered by mortgages under either its primary lender
agreement with PGIP, LLC or other financing agreements. The property is
adequately covered by liability insurance.

         The Suncoast Expressway opened during 2001. This new highway from
Tampa to the property cut the travel time by at least one third. The Company
believes this event will enhance the sale and/or ability to develop the
property. The Company will determine whether it can generate more revenue by
developing and selling individual commercial properties or by selling the
land in bulk.

Item 3.           Legal Proceedings
-------           -----------------

         The Company is a party to a number of lawsuits incidental to the
normal operation of its business. Based upon information presently
available, the Company does not believe that the resolution of any of the
suits individually, or collectively, will have a material adverse effect on
its financial position (see Note 15 of Item 7).

Item 4.           Submission of Matters to a Vote of Security Holders
-------           ---------------------------------------------------

         A shareholders meeting was not held during the year 2001.

                                   PART II
                                   -------

Item 5.           Market for Common Equity and Related Stockholder Matters
-------           --------------------------------------------------------

         There is no public trading market for the Company's common equity
securities. Based on information received from the National Quotations
Bureau, Inc. there have been no reported transactions in the Company's
common stock since January 29, 1991. No dividends have ever been paid on the
Common Stock, and payment of dividends is restricted under the terms of the
two indentures pursuant to which the Company's outstanding debentures are
issued. As of December 31, 2001 there were 650 holders of record of the
Company's Common Stock and approximately 445 debenture holders.


                                     -4-


<PAGE>
<PAGE>

Item 6.           Management's Discussion and Analysis or Plan of Operation
-------           ---------------------------------------------------------

PRELIMINARY NOTE

         With the completion of the Suncoast Expressway to Highway 98 in
2001 and the anticipated further extension of the expressway in coming
years, the Company will evaluate whether it can generate more revenue by
developing and selling individual commercial properties or by selling land
in bulk.

RESULTS OF OPERATIONS

         Revenues for the year ended December 31, 2001 decreased by $17,000
to $159,000 compared to revenues of $176,000 for the year ended December 31,
2000 mainly as a result of a decrease in other income. The net loss was
$2,150,000 ($.52 per share) for 2001 compared to a net loss of $1,850,000
($.47 per share) for 2000. Included in the 2001 and 2000 earnings per share
computation is $640,000 ($.19 per share of Common Stock) of annual
cumulative preferred stock dividends in arrears.

Real Estate Activities
----------------------

         Sales and Cost of Sales for real estate operations for the years of
2001 and 2000 were:

<TABLE>
<CAPTION>
                                             2001              2000
                                             ----              ----
                                                 ($ in thousands)
<S>                                          <C>               <C>
           Homesite Sales                    $  103            $  103
           Cost of Sales                         40                39
                                             ------            ------
           Gross Profit Margin               $   63            $   64
                                             ======            ======
</TABLE>

Other Income Activities
-----------------------

         Interest income in 2001 decreased by $2,000 to $41,000 from $43,000
compared to a 2000 decrease of $28,000 from 1999, due to a decrease in
restricted cash, and lower interest rates.

         Other income for the years of 2001 and 2000 was:

<TABLE>
<CAPTION>
                                             2001              2000
                                             ----              ----
                                                ($ in thousands)
<S>                                          <C>               <C>
Other income                                 $  15             $  30
                                             =====             =====
</TABLE>

         Other income in 2001 decreased by $15,000 compared to 2000.


                                     -5-


<PAGE>
<PAGE>

Item 6.           Management's Discussion and Analysis or Plan of Operation
-------           ---------------------------------------------------------
                  (continued)
                  -----------

Costs and Expenses
------------------

         General and administrative expenses decreased by $17,000 in 2001
compared to 2000 due to a bond premium incurred in 2000 related to a
restricted escrow fund for real estate taxes in litigation. The restricted
fund was released October 25, 2000 with confirmation from the Citrus County
property appraiser's office that no additional taxes were due for 1994
through 1996 tax years.

Interest expense for the two years ended December 31, 2001 and 2000 was:

<TABLE>
<CAPTION>
                                      2001              2000
                                      ----              ----
                                         ($ in thousands)
<S>                                   <C>               <C>
Interest Expense                      $2,108            $1,989
</TABLE>

         Interest expense in 2001 increased by $119,000 compared to 2000.

FINANCIAL CONDITION

         Assets decreased at December 31, 2001 compared to assets at
December 31, 2000 reflecting the following changes:

<TABLE>
<CAPTION>
                                                                    Increase
                 ($ in thousands)     2001           2000          (Decrease)
                                      ----           ----          ----------
<S>                                  <C>            <C>               <C>
Cash and Cash Equivalents            $  234         $  454            (220)
Restricted Cash                         260            333             (73)
Receivables                             130             49              81
Land and Improvement                    737            760             (23)
Other Assets                            173            164               9
                                     ------         ------            ----
                                     $1,534         $1,760            (226)
                                     ======         ======            ====
</TABLE>

         Cash decreased by $220,000 to $234,000 at December 31, 2001
compared to $454,000 at December 31, 2000. Net cash used in operations was
$114,000 for the year ended December 31, 2001 compared to net cash used in
operations of $568,000 for the year ended December 31, 2000.

         Cash received from operations during 2001 was $140,000, a $17,000
increase from cash received during 2000.


                                     -6-


<PAGE>
<PAGE>

Item 6.           Management's Discussion and Analysis or Plan of Operation
-------           ---------------------------------------------------------
                  (continued)
                  -----------

         Cash expended for operations decreased by $437,000 to $254,000
during 2001 from $691,000 in 2000, reflecting decreases in the following
classifications; real estate operations ($1,000), taxes and assessments
($7,000), consulting and accounting ($309,000), general and administrative
($142,000), interest payments ($1,000) and an increase in legal and
professional ($23,000).

         The $106,000 used in investing activities during 2001 included
$100,000 in advances to Love Investment Company and $11,000 in expenditures
relating to inventory and deferred expenditures offset by $5,000 in proceeds
from notes receivable.

         The $1,009,000 provided during 2000 from investing activities
included $1,029,000 of restricted cash funds released, and $4,000 in
proceeds from notes receivable offset by $24,000 in expenditures relating to
inventory and deferred expenditures.

         The $15,000 utilized during 2000 in financing activities represents
a debt repayment of $15,000 to Love Investment Company.

         In order to satisfy its debt obligations, the Company has been and
intends to continue to:
         -  actively seek buyers for the remaining portion of the
            undeveloped acreage, when appropriate;
         -  diligently pursue collection of its receivables; and
         -  sell the remaining lots.

         No assurances can be made that the Company can achieve any of the
three above alternatives.

         A comparison of the contract receivable delinquency status at
December 31, 2001 and 2000 follows:

<TABLE>
<CAPTION>
                                            2001       %               2000       %
                                            ----     -----             ----     -----
                                                        ($ in thousands)
<S>                                         <C>      <C>               <C>      <C>
Current                                     $  -         -             $  -         -
31 to 90 days delinquent                       -         -                -         -
Over 90 days                                $177     100.0             $222     100.0
                                            ----     -----             ----     -----
         Total delinquents                  $177     100.0             $222     100.0
                                            ----     -----             ----     -----
         Total contracts                    $177     100.0             $222     100.0
                                            ====     =====             ====     =====
</TABLE>


                                     -7-


<PAGE>
<PAGE>

Item 6.           Management's Discussion and Analysis or Plan of Operation
-------           ---------------------------------------------------------
                  (continued)
                  -----------

Contracts receivable on homesite sales and related receivables are fully
provided for cancellation at December 31, 2001 and 2000. The Company has
experienced deterioration in the quality of the contracts receivable
portfolio over the past several years. The Company believes the
deterioration is the result of the adverse publicity regarding community
developers, as well as the difficulty of implementing contract collection
activities for foreign receivables.

         Liabilities were approximately $29,900,000 at December 31, 2001
compared to approximately $28,000,000 at December 31, 2000, reflecting the
following changes:

<TABLE>
<CAPTION>
                                                                              Increase
                                                2001            2000         (Decrease)
                                                ----            ----         ----------
                                                  ($ in thousands)
<S>                                           <C>             <C>             <C>
Accounts payable and accrued expenses         $    73         $   112         $   (39)
Accrued real estate taxes                         382             442             (60)
Accrued interest                               17,004          14,981           2,023
Credit agreements - primary
  lender                                          700             700               -
Notes payable                                   1,198           1,198               -

Convertible subordinated
Debentures payable                              9,059           9,059               -
Convertible debentures payable                  1,500           1,500               -
                                              -------         -------         -------
                                              $29,916         $27,992         $ 1,924
                                              =======         =======         =======
</TABLE>

         The $2,023,000 increase in accrued interest at December 31, 2001
compared to year-end 2000 reflects changes in the following:

<TABLE>
<CAPTION>
                                                                              Increase
                                                2001            2000         (Decrease)
                                                ----            ----         ----------
                                                  ($ in thousands)
<S>                                           <C>             <C>             <C>
Debentures                                    $14,995         $13,077         $ 1,918
Other                                           2,009           1,904             105
                                              -------         -------         -------
                                              $17,004         $14,981         $ 2,023
                                              =======         =======         =======
</TABLE>

         The accrued interest relating to debentures increased due to the
nonpayment of interest on the Company's debentures (see Notes 10 and 11 to
the consolidated financial statements under Item 7).


                                     -8-


<PAGE>
<PAGE>

Item 6.           Management's Discussion and Analysis or Plan of Operation
-------           ---------------------------------------------------------
                  (continued)
                  -----------

         The Company's capital deficiency increased to $28,382,000 at
December 31, 2001 from a $26,232,000 capital deficiency at December 31,
2000, reflecting the 2001 operating loss.

         As of the date of this filing, the Company is in default of the
entire principal plus interest on its subordinated debentures payable in
amounts indicated in the following table:

<TABLE>
<CAPTION>
                                                             12/31/2001
                                                             ----------
                                                     Principal           Unpaid
                                                    Amount Due          Interest
                                                    ----------          --------
                                                          ($ in thousands)
<S>                                                   <C>                <C>
Subordinated debentures due June 1, 1991              1,034              $  826
Subordinated debentures due May 1, 1992               8,025               7,504
                                                      -----              ------
                                                      9,059              $8,330
                                                      =====              ======
</TABLE>

         The Company does not have funds available to make any payments of
either principal or interest on the above debentures. (See Notes 9, 10 and
11 to the consolidated financial statements under Item 7). Since the Company
assets are encumbered by mortgages, the secured lenders have a perfected
security interest and priority over the unsecured debenture holders.

New Accounting Standards
------------------------

         Statements of Financial Accounting Standards (SFAS) 133 (as
amended) regarding derivative instruments will become effective for the
Company immediately subsequent to the year ended December 31, 2000.
Historically, the Company has not entered into derivative contracts either
to hedge existing risks or for speculative purposes. Accordingly, the
adoption of the standard is not expected to affect the Company's financial
statements.

         In July 2001, the Financial Accounting Standards Board issued SFAS
141, "Business Combinations", and SFAS 142, "Goodwill and Other Intangible
Assets". SFAS 141 requires that the purchase method of accounting be used
for all business combinations initiated or completed after June 30, 2001.
SFAS 141 also specifies criteria intangible assets acquired in a purchase
method business combination must meet to be recognized and reported apart
from goodwill. SFAS 142 requires that goodwill and intangible assets with
indefinite useful lives no longer be amortized, but instead tested for
impairment at least annually in accordance with the provisions of SFAS 142.
SFAS 142 also requires that intangible assets with definite useful lives be
amortized over their


                                     -9-


<PAGE>
<PAGE>

respective estimated useful lives to their estimated residual values, and
reviewed for impairment in accordance with SFAS 121, "Accounting for the
Impairment of Long-Lived Assets, and for Long-Lived Assets to be Disposed
of". Management has determined that implementation of SFAS 141 and SFAS 142
will not have an effect on the Company's financial statements.

         The FASB recently adopted SFAS 143, "Accounting for Asset
Retirement Obligations." This Statement requires an entity to record a
liability for an obligation associated with the retirement of an asset at
the time the liability is incurred by capitalizing the cost as part of the
carrying value of the related asset and depreciating it over the remaining
useful life of the asset. SFAS 143 is effective for fiscal years beginning
after June 15, 2002. Management has determined that implementation of SFAS
143 will not have an effect on the Company's financial statements.

         The FASB recently adopted SFAS 144, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed of." This
Statement addresses how and when to measure impairment on long-lived assets
and how to account for long-lived assets that an entity plans to dispose of
either through sale, abandonment, exchange or distribution to owners. The
Statement also requires expected future operating losses from discontinued
operations to be recorded in the period in which the losses are incurred
rather than the measurement date. SFAS 144 is effective for fiscal years
beginning after December 15, 2001. Management has determined that
implementation of SFAS 144 will not have an effect on the Company's
financial statements.


                                    -10-


<PAGE>
<PAGE>

Item 7.           Financial Statements
-------           --------------------

                      Independent Accountants' Report
                      -------------------------------

Board of Directors and Stockholders
PGI Incorporated
St. Louis, Missouri

We have audited the accompanying consolidated statements of financial
position of PGI Incorporated and subsidiaries as of December 31, 2001 and
2000, and the related consolidated statements of operations, stockholders'
deficiency and cash flows for each of the two years in the period ended
December 31, 2001. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of PGI
Incorporated and subsidiaries as of December 31, 2001 and 2000, and the
results of its operations and its cash flows for each of the two years in
the period ended December 31, 2001 in conformity with accounting principles
generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 10 to the
financial statements, the Company is currently in default of certain sinking
fund and interest payments on its convertible subordinated debentures. The
Company has a significant accumulated deficit, and is in default of its
primary debt (Note 9), certain sinking fund and interest payments on its
convertible subordinated debentures (Note 10) and its convertible debentures
(Note 11). These matters raise substantial doubt about the Company's ability
to continue as a going concern. Management's plans in this regard are
described in Note 10. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.


                                                    /s/ BKD, LLP
St. Louis, Missouri
March 12, 2002


                                    -11-


<PAGE>
<PAGE>

<TABLE>
                                                 PGI INCORPORATED AND SUBSIDIARIES
                                           CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
                                                    December 31, 2001 and 2000

<CAPTION>
                                            ASSETS                                                             LIABILITIES
                                            ======                                                             ===========
                                     2001            2000                                                 2001             2000
                                     ----            ----                                                 ----             ----
<S>                               <C>             <C>                  <S>                            <C>              <C>
Cash and cash equivalents         $  234,000      $  454,000           Accounts payable                $   73,000       $  112,000
                                                                        and accrued expenses (Note 8)
Restricted cash (Note 3)             260,000         333,000

Receivables on real estate sales-                                      Accrued real estate
net (Note 4)                          16,000          10,000            taxes (Note 8)                    382,000          442,000

Other receivables                    114,000          39,000           Accrued interest:
Land and improvement                                                   Debentures                      14,995,000       13,077,000
 inventories (Note 5)                737,000         760,000           Other                            2,009,000        1,904,000

Other assets (Note 7)                173,000         164,000
                                                                       Credit Agreements - (Note 9)
                                                                          Primary lender                  700,000          700,000
                                                                          Notes payable                 1,198,000        1,198,000
                                                                       Subordinated convertible
                                                                       debentures payable
                                                                        (Note 10)                       9,059,000        9,059,000

                                                                       Convertible debentures
                                                                       payable (Note 11)                1,500,000        1,500,000
                                                                                                       ----------       ----------

                                                                                                       29,916,000       27,992,000
                                                                                                       ----------       ----------
                                                                       Commitments and contingencies
                                                                        (Note 15)
                                                                       STOCKHOLDERS' DEFICIENCY
                                                                       ========================
                                                                       Preferred stock, par value
                                                                       $1.00 per share; authorized
                                                                       5,000,000 shares; 2,000,000
                                                                       Class A cumulative convertible
                                                                       shares issued and outstanding;
                                                                       (liquidation preference of
                                                                       $8,000,000 and cumulative
                                                                       dividends) (Note 13)             2,000,000        2,000,000

                                                                       Common stock, par value
                                                                       $.10 per share; authorized
                                                                       25,000,000 shares; 5,317,758
                                                                       shares issued and outstanding
                                                                       (Note 13)                          532,000          532,000
                                                                       Paid-in capital                 13,498,000       13,498,000

                                                                       Accumulated deficit            (44,412,000)     (42,262,000)
                                                                                                      -----------      -----------
                                                                                                      (28,382,000)     (26,232,000)
                                  ----------      ----------                                          -----------      -----------
                                  $1,534,000      $1,760,000                                           $1,534,000       $1,760,000
                                  ==========      ==========                                          ===========      ===========

                                   See accompanying notes to consolidated financial statements.
</TABLE>


                                    -12-


<PAGE>
<PAGE>

<TABLE>
                            PGI INCORPORATED AND SUBSIDIARIES
                          CONSOLIDATED STATEMENTS OF OPERATIONS
                         Years ended December 31, 2001 and 2000

<CAPTION>
                                                          2001                  2000
                                                          ----                  ----
<S>                                                   <C>                   <C>
Revenues:
         Real estate sales (Note 2)                   $   103,000           $   103,000
         Interest income                                   41,000                43,000
         Other income (Note 2)                             15,000                30,000
                                                      -----------           -----------
                                                          159,000               176,000
                                                      -----------           -----------

Costs and expenses:
         Cost of real estate sales (Note 2)                40,000                39,000
         Interest                                       2,108,000             1,989,000
         Taxes and assessments, net of
           refunds of $297,000 in 2000                      8,000              (185,000)
           (Note 15)
         Consulting and accounting                         40,000                42,000
         Legal and professional                            56,000                67,000
         General and administrative                        57,000                74,000
                                                      -----------           -----------
                                                        2,309,000             2,026,000
                                                      -----------           -----------

Net (Loss)                                            $(2,150,000)          $(1,850,000)
                                                      ===========           ===========

(Loss) Per Share Available to Common                         (.52)                 (.47)
  Stockholders - Basic and Diluted (Note 18)                 ====                  ====



              See accompanying notes to consolidated financial statements.
</TABLE>


                                    -13-


<PAGE>
<PAGE>

<TABLE>
                              PGI INCORPORATED AND SUBSIDIARIES
                            CONSOLIDATED STATEMENTS OF CASH FLOWS
                            Years ended December 31, 2001 and 2000

<CAPTION>
                                                                   2001              2000
                                                                   ----              ----
<S>                                                             <C>               <C>
Cash flows from operating activities:

Cash received from operations:
  Collections from real estate sales and
  receivables on such sales                                     $  97,000         $   94,000
  Interest received                                                23,000             12,000
  Other operating receipts                                         20,000             17,000
                                                                ---------         ----------
                                                                $ 140,000         $  123,000
                                                                ---------         ----------
Cash expended for operations:
  Payments for real estate sales                                   13,000             14,000
  Interest paid                                                         -              1,000
  Taxes and assessments                                            65,000             72,000
  Consulting and accounting                                        42,000            351,000
  Legal and professional                                           66,000             43,000
  General and administrative                                       68,000            210,000
                                                                ---------         ----------
                                                                  254,000            691,000
                                                                ---------         ----------
Net cash flow (used in)
  operating activities                                           (114,000)          (568,000)
                                                                ---------         ----------

Cash flows from investing activities:
  Purchases of inventory and deferred expenditures                (11,000)           (24,000)
  Proceeds from release of restricted cash                              -          1,029,000
  Payments for notes receivable                                  (100,000)                 -
  Proceeds from notes receivable                                    5,000              4,000
                                                                ---------         ----------
Net cash flow provided by (used in) investing activities         (106,000)         1,009,000
                                                                ---------         ----------

Cash flows from financing activities:
Principal payments on debt                                              -            (15,000)
                                                                ---------         ----------
  Net cash flow (used in) financing activities                          -            (15,000)
                                                                ---------         ----------

Net (decrease) increase in cash and cash equivalents             (220,000)           426,000

Cash and cash equivalents at beginning of year                    454,000             28,000
                                                                ---------         ----------
Cash and cash equivalents at end of year                        $ 234,000         $  454,000
                                                                =========         ==========

Non-cash investing and financing activities:
  Earnings capitalized into restricted cash                     $  12,000         $   22,000
                                                                ---------         ----------
  Interest paid from restricted cash                            $  85,000         $  101,000
                                                                ---------         ----------

<CAPTION>
                 See accompanying notes to consolidated financial statements.


                                    -14-


<PAGE>
<PAGE>

                             PGI INCORPORATED AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                          Years ended December 31, 2001 and 2000

                                                              2001                 2000
                                                              ----                 ----
<S>                                                       <C>                 <C>
Reconciliation of net (loss) to net cash (used in)
  operating activities:

Net (loss)                                                $(2,150,000)        $(1,850,000)

Adjustments to reconcile net (loss) to net cash
  (used in) operating activities:
         Earnings capitalized into restricted cash            (12,000)            (22,000)
         Interest released from restricted cash                85,000             101,000

(Increase) decrease in assets:
  Other receivables                                            14,000             (10,000)
  Land and improvement inventories-net                         28,000              16,000
  Prepaid expenses & deposits                                  (3,000)             13,000
Increase (decrease) in liabilities:
  Accounts payable and accrued expenses                       (39,000)           (441,000)
  Accrued real estate taxes                                   (60,000)           (261,000)
  Accrued interest                                          2,023,000           1,886,000
                                                          -----------         -----------

Net cash flow (used in) operating activities              $  (114,000)        $  (568,000)
                                                          ===========         ===========

               See accompanying notes to consolidated financial statements.
</TABLE>


                                    -15-


<PAGE>
<PAGE>

<TABLE>
                                                PGI INCOPORATED AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIENCY
                                             Years ended December 31, 2001 and 2000

<CAPTION>
                                  Preferred Stock                    Common Stock                                   Retained
                                  ---------------                    ------------                                   Earnings
                             Shares          Par Value          Shares         Par Value      Paid-In Capital       (Deficit)
                             ------          ---------          ------         ---------      ---------------       ---------
<S>                         <C>              <C>               <C>              <C>             <C>                <C>
Balances at 1/1/00          2,000,000        $2,000,000        5,317,758        $532,000        $13,498,000        $(40,412,000)

Net Loss                            -                 -                -               -                  -          (1,850,000)
                            ---------        ----------        ---------        --------        -----------        ------------
Balances at 12/31/00        2,000,000        $2,000,000        5,317,758        $532,000        $13,498,000        $(42,262,000)

Net Loss                            -                 -                -               -                  -          (2,150,000)
                            ---------        ----------        ---------        --------        -----------        ------------
Balances at 12/31/01        2,000,000        $2,000,000        5,317,758        $532,000        $13,498,000        $(44,412,000)
                            =========        ==========        =========        ========        ===========        ============


                                  See accompanying notes to consolidated financial statements.
</TABLE>


                                    -16-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.       Significant Accounting Policies:
         --------------------------------
Principles of Consolidation
---------------------------

         The consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries after eliminating all significant
inter-company transactions.

Accounting Estimates
--------------------

         The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

Revenue and Profit Recognition
------------------------------

Homesites
---------

         The Company adopted the installment method of profit recognition in
accordance with Statement of Financial Accounting Standard No. 66
"Accounting for Sales of Real Estate".

Acreage
-------

         Sales of undeveloped and developed acreage tracts are recognized,
net of any deferred revenue and valuation discount, when minimum down
payment and other requirements are met.

Land and Improvement Inventories
--------------------------------

         Land held for sale to customers and land held for bulk sale are
stated at cost, which is not in excess of estimated net realizable value.
Homesite costs are allocated to projects based on area methods, which
consider footage, future improvements costs and frontage.

Property and Equipment
----------------------

         Property and equipment are stated at cost. Depreciation is provided
principally by the straight-line method over the estimated useful lives of
the related assets. Gains or losses resulting from the disposition of
property and equipment are respectively included in other income and other
expense.


                                    -17-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

Cash and Cash Equivalents
-------------------------

         For purposes of the statement of cash flows, the Company considers
all highly liquid debt instruments purchased with a maturity of three months
or less to be cash equivalents.

New Accounting Standards
------------------------

         SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities", as amended, requires companies to recognize all derivative
contracts as either assets or liabilities in the balance sheet and to
measure them at fair value. If certain conditions are met, a derivative may
be specifically designated as a hedge, the objective of which is to match
the timing of the gain or loss recognition on the hedging derivative with
the recognition of (1) the changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk or (2) the earnings
effect of the hedged forecasted transaction. For a derivative not designated
as a hedging instrument, the gain or loss is recognized in income in the
period of change. SFAS No. 133, as amended, is effective for all fiscal
quarters of fiscal years beginning after June 15, 2000. Management has
determined that implementation of FAS 133 on January 1, 2001 did not have an
effect on the Company's financial statements.

         In July 2001, the Financial Accounting Standards Board issued SFAS
141, "Business Combinations", and SFAS 142, "Goodwill and Other Intangible
Assets". SFAS 141 requires that the purchase method of accounting be used
for all business combinations initiated or completed after June 30, 2001.
SFAS 141 also specifies criteria intangible assets acquired in a purchase
method business combination must meet to be recognized and reported apart
from goodwill. SFAS 142 requires that goodwill and intangible assets with
indefinite useful lives no longer be amortized, but instead tested for
impairment at least annually in accordance with the provisions of SFAS 142.
SFAS 142 also requires that intangible assets with definite useful lives be
amortized over their respective estimated useful lives to their estimated
residual values, and reviewed for impairment in accordance with SFAS 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of". Management has determined that implementation of
SFAS 141 and SFAS 142 will not have an effect on the Company's financial
statements.

         The FASB recently adopted SFAS 143, "Accounting for Asset
Retirement Obligations." This Statement requires an entity to record a
liability for an obligation associated with the retirement of an asset at
the time the liability is incurred by capitalizing the cost as part of the
carrying value of the related asset and depreciating it over the remaining
useful life of the asset. SFAS 143 is effective for fiscal years


                                    -18-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

beginning after June 15, 2002. Management has determined that implementation
of SFAS 143 will not have an effect on the Company's financial statements.

         The FASB recently adopted SFAS 144, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed of." This
Statement addresses how and when to measure impairment on long-lived assets
and how to account for long-lived assets that an entity plans to dispose of
either through sale, abandonment, exchange or distribution to owners. The
Statement also requires expected future operating losses from discontinued
operations to be recorded in the period in which the losses are incurred
rather than the measurement date. SFAS 144 is effective for fiscal years
beginning after December 15, 2001. Management has determined that
implementation of SFAS 144 will not have an effect on the Company's
financial statements.

2.       Real Estate Sales and Other Income:
         -----------------------------------

Real estate sales and cost of sales consisted of:
<TABLE>
<CAPTION>
                                                        2001              2000
                                                        ----              ----
<S>                                                   <C>               <C>
         Homesites sales                              $103,000          $103,000
         Cost of Sales                                  40,000            39,000
                                                      --------          --------
         Gross Profit Margin                          $ 63,000          $ 64,000
                                                      ========          ========
<CAPTION>
                                                        2001              2000
                                                        ----              ----
<S>                                                   <C>               <C>
Other income for the years of 2001 and 2000 was:
         Other income                                 $ 15,000          $ 30,000
                                                      ========          ========
</TABLE>

3.       Restricted Cash:
         ----------------

         Restricted cash includes restricted proceeds held by the primary
lender as collateral for debt repayment and escrowed receipts related to
sold contracts receivable.

         The primary lender utilized restricted funds to pay the interest
due on the primary lender debt of $85,000 and $102,000 in 2001 and 2000,
respectively.


                                    -19-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

         Restricted cash of $372,000 was released on February 24, 2000. The
restricted fund had been established with the deposit of $250,000 in escrow
for twenty years pursuant to a Permit Agreement entered into June 19, 1973.
The agreement provided for state certification of water quality standards in
conjunction with construction of navigable waterways in Charlotte County,
Florida.

         Restricted cash of $557,000 was released on October 25, 2000 with
confirmation from Citrus County property appraisers office that no
additional taxes are due for 1994 through 1996 tax years. The restricted
fund had been established in May 1998 for payment of disputed taxes for 1994
through 1997 with Citrus County regarding agricultural exemption status.

         Restricted cash of $100,000 was released in 2000 from the
restricted funds held by the primary lender to pay operating expenditures.

4.       Receivables on Real Estate Sales:
         ---------------------------------

         Net receivables on real estate consisted of:

<TABLE>
<CAPTION>
                                               2001               2000
                                               ----               ----
<S>                                         <C>                <C>
Contracts receivable on homesite sales      $ 177,000          $ 222,000
Other                                          16,000             10,000
                                            ---------          ---------
                                            $ 193,000          $ 232,000
Less:  Allowance for cancellations           (177,000)          (222,000)
                                            ---------          ---------
                                            $  16,000          $  10,000
                                            =========          =========
</TABLE>

         The Company generally considers receivables on real estate sales
delinquent if the scheduled installment payment is over 30 days past due. At
December 31, 2001 and 2000 delinquent receivables approximated $177,000 and
$222,000 respectively.

         Contracts receivable on homesite sales and related receivables are
fully provided for cancellation at December 31, 2001 and 2000. The Company
has been actively pursuing collection on the delinquent receivables. An
assessment is made for each contract receivable as to the economic benefit
of reacquisition of the lot considering the cost of foreclosure, delinquent
taxes and association fees due, and estimated current sale value of the lot.
For those with benefit, foreclosure action is begun in the absence of
payment or receipt of a quit claim deed of the property back to the Company.
Three lots and eleven lots were reacquired through foreclosure during 2001
and 2000, respectively.

                                    -20-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

         At December 31, 2001, 49% of the Company's receivables from real
estate sales represented customers who maintain foreign status, and 5%
represented accounts which are IRA's.

         Other receivables relating to real estate sales at December 31,
2001 and 2000 mainly represents receivables on lot sales which occurred in
December, 2001 and 2000, respectively.

5.       Land and Improvements:
         ----------------------
         Land and improvement inventories consisted of:
<TABLE>
<CAPTION>
                                                         2001             2000
                                                         ----             ----
<S>                                                    <C>              <C>
                  Unimproved land                      $613,000         $613,000
                  Fully improved land                   124,000          147,000
                                                       --------         --------
                                                       $737,000         $760,000
                                                       ========         ========
</TABLE>

6.       Property and Equipment:
         -----------------------
         Property and equipment consisted of:
<TABLE>
<CAPTION>
                                                         2001             2000
                                                         ----             ----
<S>                                                    <C>              <C>
                  Furniture, fixtures and other        $ 31,000         $ 31,000
                     equipment
                  Less accumulated depreciation         (31,000)         (31,000)
                                                       --------         --------
                                                       $      -         $      -
                                                       ========         ========
</TABLE>

7.       Other Assets:
         -------------
         Other assets consisted of:
<TABLE>
<CAPTION>
                                                         2001             2000
                                                         ----             ----
<S>                                                    <C>              <C>
                  Deposit with Trustee of 6-1/2%
                     debentures                        $158,000         $152,000
                  Other                                  15,000           12,000
                                                       --------         --------
                                                       $173,000         $164,000
                                                       ========         ========
</TABLE>


                                    -21-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

8.       Accounts Payable and Accrued Expenses:
         --------------------------------------
         Accounts payable and accrued expenses consisted of:
<TABLE>
<CAPTION>
                                                               2001              2000
                                                               ----              ----
<S>                                                         <C>               <C>
                  Accounts payable                          $   48,000        $   56,000
                  Accrued audit/tax expense                     24,000            33,000
                  Accrued consulting fees                            -             2,000
                  Accrued legal expense                          1,000             4,000
                  Estimated recourse liability                       -            17,000
                     for receivables sold
                                                            ----------        ----------
                                                            $   73,000        $  112,000
                                                            ==========        ==========

         Accrued Real Estate Taxes:
         --------------------------
         Accrued real estate taxes consisted of:
                  Current                                       18,000            37,000
                  Delinquent                                   364,000           405,000
                                                            ----------        ----------
                                                            $  382,000        $  442,000
                                                            ==========        ==========
</TABLE>

9.       Credit Agreements - Primary Lender and Notes Payable:
         -----------------------------------------------------
         Credit agreements with the Company's primary lender and notes
payable consisted of the following:
<TABLE>
<CAPTION>
                                                               2001              2000
                                                               ----              ----
<S>                                                         <C>               <C>
                  Credit agreements - primary lender
                     (Balance is past due, bearing
                     interest at prime plus 5.0%):          $  700,000        $  700,000


         Notes payable -
                     $1,176,000 bearing interest at
                     prime rate plus 2%, the
                     remainder bearing interest at
                     12%; all past due                       1,198,000         1,198,000
                                                            ----------        ----------
                                                            $1,898,000        $1,898,000
                                                            ==========        ==========
</TABLE>

The prime rate at December 31, 2001 and 2000 was 4.75% and 9.5%
respectively.


                                    -22-

<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

         At December 31, 2001 assets collateralizing the Company's credit
agreements with its primary lender and notes payable totaled $1,131,000, of
which $255,000 represented escrow held by the primary lender, $177,000
represented gross receivables on real estate sales, $13,000 represented
other receivables, and $686,000 represented land and improvement
inventories.

         The overall weighted average interest rate for the Company's credit
agreements with its primary lender and all remaining notes and mortgages was
approximately 10.0% as of December 31, 2001 and 12.3% as of December 31,
2000.

         Although substantially all of the Company's real and personal
property including all of the stock of the Company's wholly-owned
subsidiaries remains pledged as collateral, the Company negotiated
agreements with its mortgage holders to allow the Company to sell part of
its land holdings without requiring full payment of the secured debt.

         All of the primary lender debt and notes payable are past due.

10.      Subordinated Convertible Debentures Payable:
         --------------------------------------------
         Subordinated debentures payable consisted of:
<TABLE>
<CAPTION>
                                                    2001               2000
                                                    ----               ----
<S>                                              <C>                <C>
                  6 1/2%, due June 1991          $1,034,000         $1,034,000
                  6%, due May 1992                8,025,000          8,025,000
                                                 ----------         ----------
                                                 $9,059,000         $9,059,000
                                                 ==========         ==========
</TABLE>

         Since issuance, $650,000 and $152,000 of the 6 1/2% and 6%
debentures, respectively, have been converted into common stock; however,
this conversion feature is no longer in effect.

         The Company is in default of certain sinking fund and interest
payments on both subordinated debentures totaling $9,059,000 in principal
plus accrued and unpaid interest of $8,330,000 at December 31, 2001 and
$7,461,000 as of December 31, 2000.

         The debentures are not collateralized and are not subordinated to
each other, but are subordinated to senior indebtedness ($3,398,000 at
December 31, 2001). Payment of dividends on the Company's common stock is
restricted under the terms of the two indentures pursuant to which the
outstanding debentures are issued.


                                    -23-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

         In order to satisfy the obligation to debenture holders, the
Company has been and intends to continue to:

-   actively seek buyers for the remaining portion of the undeveloped
    acreage, when appropriate;
-   diligently pursue collection of its receivables; and
-   sell the remaining lots.

         No assurances can be made that the Company can achieve any of the
three above alternatives.

11.      Convertible Debentures Payable:
         -------------------------------

         In July and September 1989, the Company sold $1,282,000 and
$1,000,000 respectively, of convertible debentures to a partnership
affiliated with the Company's preferred shareholder. In connection with the
July 1992 Secured Lender Transaction in partial consideration for the
conveyance of 350 acres of property, the principal amount due to convertible
debenture holders was reduced by $782,000 and accrued interest thereon was
reduced by $389,000 leaving a balance of $1,500,000. The maturity date on
all the remaining debentures was extended to July 8, 1997 so that the
debentures are in default. The past due debentures accrue interest at 14%
compounded quarterly. The Company's primary lender credit agreements,
however, prohibit the payment of interest until such time as the primary
lender loans are repaid. At maturity the Convertible Debentures purchased on
July 24, 1989, were convertible into 868,788 common shares and those
purchased on September 29, 1989, were convertible into 1,726,568 common
shares, or a total of 2,595,356 shares of common stock at an initial
conversion price of $1.72 per share. The conversion price may be adjusted
upon the occurrence of certain events.

         The debentures held by Love-1989 Florida Partners, L.P., which
total $796,950 in principal amount are secured by a second mortgage behind
PGIP, LLC on the approximate 370 acres retained by the Company and a
security interest behind that held by PGIP, LLC in the restricted proceeds
escrow.

         Accrued interest was $6,665,000 and $5,616,000 at December 31, 2001
and 2000 respectively.


                                    -24-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

12.      Income Taxes:
         -------------
         Reconciliation of the statutory federal income tax rates, 34% for
the years ended December 31, 2001 and 2000, to the Company's effective
income tax rates follows:

<TABLE>
<CAPTION>
                                          2001                        2000
                                          ----                        ----
                                                  ($ in thousands)
                               Amount of tax  Percent of   Amount of tax  Percent of
                               ------------- Pre-tax Loss  ------------- Pre-tax Loss
                                             ------------                ------------
<S>                               <C>          <C>            <C>          <C>
Expected tax (credit)             $(731)       (34.0%)        $(629)       (34.0%)
State income taxes, net of          (86)        (4.0%)          (74)        (4.0%)
  federal tax benefits
Increase in valuation               817         38.0%           703         38.0%
  allowance and expiring          -----        -----          -----        -----
  credits                         $   -            -          $   -            -
                                  =====        =====          =====        =====
</TABLE>

         At December 31, 2001, the Company had an operating loss carry
forward of approximately $38,000,000 which will expire at various dates
through 2021.
<TABLE>
<CAPTION>
                                                        2001             2000
                                                        ----             ----
                                                          ($ in thousands)
<S>                                                   <C>              <C>
Deferred tax asset:
         Net operating loss carryover                 $ 15,120         $ 14,303
         Adjustments to reduce land to net
            realizable value                                12               12
         Expenses capitalized under IRC 263(a)              56               56
         ITC carry forward                                  --              215
         Valuation allowance                           (15,016)         (14,414)
                                                      --------         --------
                                                      $    172         $    172
Deferred tax liability:
         Basis difference of land and
            improvement inventories                   $    172         $    172
                                                      --------         --------

Net deferred tax asset                                $     --         $     --
                                                      ========         ========
</TABLE>

13.      Capital Stock:
         --------------

         In March 1987, the Company sold in a private placement 1,875,000
shares of its Class A cumulative convertible preferred stock to Love-PGI
Partners, L.P. ("L-PGI") for a purchase price of $7,500,000 cash ($4.00 per
share). The Company also converted $500,000 of indebtedness owed to a
corporation owned by the Company's former Chairman of the Board of Directors
and members of his family into 125,000 shares of the cumulative convertible
preferred stock.


                                    -25-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

         The holders of the preferred stock are entitled to one vote per
share and, except as provided by law, will vote as one class with the
holders of the common stock. Class A preferred stockholders are also
entitled to receive cumulative dividends at the annual rate of $.32 per
share, an effective yield of 8%. Dividends accrued for an initial two year
period and, at the expiration of this period, preferred stockholders had the
option of receiving accumulated dividends, when and if declared by the Board
of Directors, in cash (unless prohibited by law or contract) or common
stock. At December 31, 2001 cumulative preferred dividends in arrears
totaled $4,276,000 ($640,000 of which related to the year ended December 31,
2001). On May 15, 1997 preferred dividends accrued through April 25, 1995
totaling $4,260,433 were paid in the form of 2,000,203 shares of common
stock.

         As of December 31, 2001, the preferred stock is callable or
redeemable at the option of the Company at $4.00 per share plus accrued and
unpaid dividends. In addition, the preferred stock will be entitled to
preference of $4.00 per share plus accrued and unpaid dividends in the event
of liquidation of the Company.

         At December 31, 2001 the Company had reserved 6,355,356 common
shares for the conversion of preferred stock and debentures.

14.      Quarterly Results:
         ------------------

         In the fourth quarter of 2001 the Company allowed a parcel of land
to be sold for delinquent taxes in Charlotte County, Florida. An adjustment
was made to reduce accrued real estate taxes and real estate tax expense by
$34,000.

15.      Commitments and Contingencies:
         ------------------------------

         The Company is a party to various legal proceedings incidental to
the normal operation of its business.

         One instance of litigation involves Sugarmill Woods, Inc. and
Citrus County Tax Collector. In 1994, the Citrus County Tax Appraiser denied
agricultural exemption status for the undeveloped Sugarmill Woods property
and the Company was forced to sue the County to reclaim the tax benefit. In
1995, the Citrus County Tax Appraiser again denied agricultural exemption
status for the undeveloped Sugarmill Woods property, but was overruled by
the Value Adjustment Board. As a result, the Tax Appraiser sued Sugarmill
Woods, and was again successful in denying the agricultural exemption for
the property. The Company won on appeal, but the Tax Assessor appealed to
the Supreme Court of Florida to reinstate the exemption. On April 1, 1999,
the Supreme Court of Florida issued


                                    -26-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

their opinion in favor of Sugarmill Woods, Inc. On November 9, 1999 the
Circuit Court of Citrus County adjudged the agricultural classification
applicable to tax years 1994, 1995 and 1996 for exemption. The restricted
escrow of $557,000 was released in October, 2000 with the confirmation of no
further liability for tax years 1994, 1995 and 1996. Tax year 1997 remains
in dispute on a matter of timely filing of petition for exemption.

         The aggregate outstanding balances of receivables sold or exchanged
with recourse by the Company totaled approximately $17,000 and $34,000 at
December 31, 2001 and 2000 respectively. Based on its collateral experience
with such receivables, the Company maintained no allowance at December 31,
2001. At December 31, 2000 the Company maintained an allowance of $17,000
classified in accounts payable and accrued expenses for the recourse
provisions related to all receivables sold.

         Under the terms of the receivables sale agreements the Company must
repurchase contracts greater than 90 days past due or exchange current
contracts owned by the Company. The repurchase price is equal to the
outstanding principal balance of the delinquent contract plus accrued
interest. At December 31, 2001, sold contracts receivable were all current.
The related accrued interest is considered immaterial.

16.      Related Party Transactions:
         ---------------------------

         As of December 31, 2001 the Company was in default of its primary
credit agreements with PGIP, LLC ("PGIP").

         PGIP is owned and managed by Love Savings Holding Company ("LSHC"),
Andrew S. Love, Jr. and Laurence A. Schiffer. Messrs. Love and Schiffer are
directors and executive officers of LSHC and own slightly more than half of
all the issued and outstanding voting stock of LSHC. Messrs. Love and
Schiffer serve as the executive officers and directors of the Company and
the other Borrowers and the Guarantors.

         The Company maintains its administration and accounting offices
with Love Real Estate Company ("LREC"). LREC, which is an affiliate of
L-PGI, the Company's preferred shareholder, is paid a monthly fee for the
following:

         1.  Maintain books of original entry;
         2.  Prepare quarterly and annual SEC filings;
         3.  Coordinate the annual audit;
         4.  Assemble information for tax filing, review reports as prepared
             by tax accountants and file same;


                                    -27-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

         5.  Track shareholder records through transfer agent;
         6.  Maintain policies of insurance against property and liability
             exposure;
         7.  Handle day-to-day accounting requirements

         In addition, the Company receives office space, telephone service
and computer service from LREC. A fee of $2,800 per month was paid to LREC
in 2001 and 2000.

         Effective March 25, 1987, the Company entered into a Management
Consulting Agreement with LREC. As a consultant to the Company and in
addition to the above services, LREC provides other services including, but
not limited to, strategic planning, marketing and financing as requested by
the Company. In consideration for these consulting services, the Company
pays LREC a quarterly consulting fee of one-tenth of one per cent of the
book value of the Company's assets, plus reasonable out-of-pocket expenses.
As of December 31, 2001, the book value of the Company's assets was
approximately $1,534,000. Consulting fees totaling $7,000 and $8,000 were
accrued during 2001 and 2000 respectively. The Company made payments of
$7,000 in 2001 and $315,000 in 2000 for consulting fees. As of December 31,
2001 there were no unpaid fees, at December 31, 2000 a total of $2,000 of
unpaid fees had accrued under this agreement.

         An affiliate of L-PGI, the Company's preferred shareholder, Love
Investment Company made an uncollateralized loan to the Company of $15,000
in August 1999. The 1999 loan balance plus accrued interest was paid on
February 28, 2000. Interest charged on the loan was $1,000 for the period
August, 1999 through February, 2000.

         In 1985 a corporation owned by the former Chairman of the Board
and his family made an uncollateralized loan to the Company, which at
December 31, 2001 had an outstanding balance, including accrued interest
of $447,000. Interest accrued on this loan for years 2001 and 2000 was
$16,000 and $20,000 respectively.

         From time to time, the Company invests in short-term debt
obligations of an affiliated bank and holding company. An investment of
$250,000 was made in January, 2001 and repaid in August 2001, plus interest
at the prime rate amounting to $10,000 for the period January to August,
2001.

         The Company also has invested in short term debt obligations
with an affiliate of L-PGI, the Company's preferred shareholder, Love
Investment Company in the fourth quarter of 2001. The balance receivable
at December 31, 2001 was $100,000, interest paid on the loans was $3,000
in 2001 for the period October through December.


                                    -28-


<PAGE>
<PAGE>

                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

17.      Fair Value of Financial Instruments:
         ------------------------------------

         The following methods and assumptions were used to estimate the
fair value of each class of financial instrument for which it is practicable
to estimate that value:

Cash and Short-Term Investments:

         The carrying amount approximates fair value because of the short
maturity of those instruments.

Debt:

         It was not practicable to estimate the fair value of the Company's
debt with its primary lender, its notes payable and its convertible
debentures because these debts are in default causing no basis for
estimating value by reference to quoted market prices or current rates
offered to the Company for debt of the same remaining maturities.

Accounts Payable:

         The carrying amount approximates fair value because of the
short-term maturity of those debts. The estimated fair values of the
Company's financial instruments are as follows:
<TABLE>
<CAPTION>
                                                      Carrying              Fair
              2001                                     Amount               Value
              ----                                     ------               -----
<S>                                                  <C>                  <C>
Cash and short-term investments                        $494,000           $494,000
Accounts payable                                         48,000             48,000
Debt                                                 12,457,000                  -
</TABLE>

18.      (Loss) Per Share:
         -----------------
         The following is a summary of the calculations used in computing
basic and diluted (loss) per share:
<TABLE>
<CAPTION>
                                                         2001                       2000
                                                         ----                       ----
<S>                                                  <C>                        <C>
Numerator:
Net (Loss)                                           $(2,150,000)               $(1,850,000)
Preferred Dividends                                     (640,000)                  (640,000)
                                                     -----------                -----------
(Loss) Available to
  Common Shareholders                                $(2,790,000)               $(2,490,000)
                                                     ===========                ===========


                                    -29-


<PAGE>
<PAGE>

<CAPTION>
                      PGI INCORPORATED AND SUBSIDIARIES
           Notes to Consolidated Financial Statements (continued)

<S>                                                  <C>                        <C>
Denominator:
BASIC
Weighted average amount of shares
         outstanding                                   5,317,758                  5,317,758

DILUTED
Weighted average amount of shares
         outstanding                                   5,317,758                  5,317,758
Dilutive effect of assumed conversion
         of Preferred Stock                                    -                          -
                                                       ---------                  ---------
Dilutive common shares                                 5,317,758                  5,317,758
                                                       =========                  =========

(Loss) per share
         Basic                                              (.52)                      (.47)
         Diluted                                            (.52)                      (.47)
</TABLE>


Item 8.           Changes in and Disagreements with Accountants on Accounting
-------           -----------------------------------------------------------
                  and Financial Disclosure
                  ------------------------

         See current report on Registrant's amendment to Form 8-K filed
         December 14, 2001.



                                    -30-


<PAGE>
<PAGE>


                                  PART III
                                  --------

Item 9.           Directors, Executive Officers, Promoters and Control Persons;
-------           -------------------------------------------------------------
                  Compliance with Section 16(a) of the Exchange Act
                  -------------------------------------------------

         The following information, regarding executive officers and
directors of the Company, is as of March 25, 2002.
<TABLE>
<CAPTION>
                                    Position with Company and Business Experience
         Name and Age               During the Last Five Years
         ------------               ----------------------------------------------
<S>                                 <C>
Laurence A. Schiffer                Director of the Company since April 1987; President and
      (age 62)                      Chief Executive Officer of the Company since February
                                    1994; Vice Chairman of the Board since May 1987;
                                    President and Chief Executive Officer of Love Real Estate
                                    Company and Love Investment Company since 1973; Chairman
                                    of Heartland Bank and President of LSHC, the parent
                                    company of Heartland Bank since December 1985; Manager of
                                    PGIP since 1995; member of the Real Estate Board of
                                    Metropolitan St. Louis and the National Association of
                                    Real Estate Boards.

Andrew S. Love Jr.                  Chairman of the Company's Board of Directors since May
      (age 58)                      1987; Secretary since February 1994; Chairman of the
                                    Board of Love Real Estate Company and Secretary of Love
                                    Investment Company since 1973; Partner in St. Louis based
                                    law firm of Bryan, Cave, McPheeters & McRoberts until
                                    1991; Director of Heartland Bank and Chairman of LSHC,
                                    the parent company of Heartland Bank since December 1985;
                                    Manager of PGIP since 1995.
</TABLE>

         Executive officers of the Company are appointed annually by the
Board of Directors to hold office until their successors are appointed and
qualify.

Item 10.          Executive Compensation
--------          ----------------------

         The Company's Chief Executive Officer is Mr. Laurence A. Schiffer.
Because of the Company's impaired financial condition, it does not
compensate Mr. Schiffer or Mr. Love, the Company's only other executive
officer, for the services they perform for the Company in that capacity.
Management services are provided to the Company by Love Real Estate Company
pursuant to that certain Management Consulting Agreement by and between the
Company and LREC dated March 25, 1987 (the "Management Agreement"). Mr.
Schiffer is an employee of, and receives an annual salary from LREC. Mr.
Love receives only a nominal salary from LREC. Neither the Company nor LREC
maintains


                                    -31-


<PAGE>
<PAGE>

records, which would allow either of them to attribute any portion of the
remuneration Mr. Schiffer receives from LREC to the management services he
performs for the Company. See Item 12. "Certain Relationships and Related
Party Transactions" for additional information about the Management
Agreement.

         Neither Mr. Schiffer nor Mr. Love received fees from any source
directly attributable to their services as directors of the Company during
2001.

Item 11.          Security Ownership of Certain Beneficial Owners and Management
--------          --------------------------------------------------------------

         The table below provides certain information as of March 25, 2002
regarding the beneficial ownership of the Common Stock and the Preferred
Stock by each person known by the Company to be the beneficial owner of more
than five percent of either the Common Stock or the Preferred Stock, each
director of the Company (which persons are also the Company's only executive
officers), and by virtue of the foregoing, the directors and executive
officers of the Company as a group.

<TABLE>
<CAPTION>
                                                                            Percent of Total
                                                                            ----------------        Percent of
                                           Common          Preferred       Common    Preferred     Total Voting
         Name                               Stock            Stock        Stock (1)    Stock         Power (1)
         ----                               -----            -----        ---------    -----         ---------
<S>                                     <C>               <C>               <C>        <C>             <C>
Estate of Harold Vernon (9)               998,777(2)(3)           -         18.8%         -            13.7%
Alfred M. Johns (9)                       437,414(4)        125,000(4)       8.2%       6.3%            7.7%
Love-PGI Partners, L.P. (9)             2,260,706(5)      1,875,000(5)      42.5%      93.8%           56.5%
Andrew S. Love, Jr. (9)                   385,516(6)      1,875,000(6)      42.5%      93.8%           56.5%
Laurence A. Schiffer  (9)                 385,516(7)      1,875,000(7)      42.5%      93.8%           56.5%
All executive officers and directors
   as a group (2 persons)                 385,516(8)      1,875,000(8)      42.5%      93.8%           56.5%

<FN>
1.       The above table does not include 2,595,356 shares that may be
         received upon conversion of the Company's Convertible Secured
         Debentures.
2.       The shares of Common Stock owned by Mr. Vernon are currently in the
         possession of the Federal Deposit Insurance Corporation ("FDIC")
         which is the receiver for First American Bank and Trust, Lake
         Worth, Florida ("First American"). First American previously made a
         loan to Mr. Vernon, which was secured by these shares. The loan is
         in default and the Company understands that the FDIC has the right,
         pursuant to a pledge agreement, to vote the shares at any annual or
         special meeting of shareholders.
3.       Information obtained from filings made with the Securities and
         Exchange Commission.
4.       Sole voting and investment power over 302,401 shares of Common
         Stock; shared voting and investment power over 10,100 shares of
         Common Stock included in the table which are owned by Mr. John's
         wife; sole voting and investment power over the 125,000 shares of
         Preferred Stock.
5.       The controlling general partner of L-PGI is Love Investment
         Company, a Missouri Corporation owned by Mr. Love, Love family
         members and trusts, the Estate of Martha Love Symington and Mr.
         Schiffer. Messrs. Love and Schiffer serve as the executive officers
         and directors of Love Investment Company.
6.       These shares are the same shares owned by L-PGI. Mr. Love is an
         indirect owner of L-PGI. See Footnote 5 above and Item 12. "Certain
         Relationships and Related Transactions" for more information.
7.       These shares are the same shares owned by L-PGI. Mr. Schiffer is an
         indirect owner of L-PGI. See Footnote 5 above and Item 12. "Certain
         Relationships and Related Transactions" for more information.
8.       These shares are the same shares reflected in Footnotes 5, 6 and 7.
         See Footnote 5 above and Item 12. "Certain Relationships and
         Related Transactions" for more information.


                                    -32-


<PAGE>
<PAGE>

9.       Addresses for beneficial owners are as follows:
         Estate of Harold Vernon            Love-PGI Partners, L.P.          Laurence A. Schiffer
         3201 W. Rolling Hills Circle       212 So. Central, Suite 100       212 So. Central, Suite 201
         Fort Lauderdale, FL 33328          St. Louis, MO 63105              St. Louis, MO 63105

         Alfred M. Johns                    Andrew S. Love, Jr.
         One Woodland Drive                 212 South Central, Suite 201
         Punta Gorda, FL 33950              St. Louis, MO 63105
</TABLE>

Item 12.          Certain Relationships and Related Transactions
--------          ----------------------------------------------

         The Company's primary lender debt of $700,000 is with PGIP and is
secured by substantially all of the Company's real estate. PGIP became the
primary lender in March 1996, with the assignment by First Union, the
Company's former primary bank lender, of all its right, title and interest
in and to the loan documents. PGIP is 100% owned by LSHC. Messrs. Love and
Schiffer own approximately 52% of all the issued and outstanding voting
stock of LSHC and serve as the directors and officers of LSHC. LSHC along
with Messrs. Love and Schiffer are the managers of PGIP.

         As further security to the primary lender indebtedness with PGIP, a
restricted proceeds escrow was established with the closing of the bulk
acreage sale in May 1998. The escrow agreement permits funds to be paid (i)
as requested by PGI and agreed to by PGIP, or (ii) as deemed necessary and
appropriate by PGIP to protect its interest in the remaining real estate,
including its right to receive principal and interest payments on the
indebtedness, or (iii) to PGIP to pay any other obligations owed to PGIP by
the Company. At December 31, 2001 and 2000, the restricted escrow balance
was $255,000 and $327,000 respectively. PGIP released $100,000 of restricted
escrow funds to PGI in 2000 to pay operating expenditures. PGIP utilized
$85,000 and $102,000 in 2001 and 2000, respectively, to pay interest due on
the primary lender debt.

         The Company maintains its administration and accounting offices
with the offices of LREC in St. Louis, Missouri. LREC, a Missouri
Corporation, is an affiliate of L-PGI, and is located at 212 South Central
Avenue, Suite 100, St. Louis, Missouri 63105. A fee of $2,800 per month was
paid to LREC in 2001 and 2000. The following is a list of services provided:

         1.  Maintain books of original entry;
         2.  Prepare quarterly and annual SEC filings;
         3.  Coordinate the annual audit;
         4.  Assemble information for tax filing, review reports as prepared
             by tax accountants and file same;
         5.  Track Shareholder records through transfer agent;
         6.  Maintain policies of insurance against property and liability
             exposure;
         7.  Handle day-to-day accounting requirements; and
         8.  Provide telephone and computer service.


                                    -33-


<PAGE>
<PAGE>

         Although an amount is paid to LREC as reimbursement for expenses
and as a fee for providing management services to the Company, neither the
Company nor LREC maintain records which would allow them to attribute any
portion of the aforementioned monthly fee to reimbursement of particular
expenses or to payment for the management services performed for the Company
by individual employees of LREC, including Messrs. Love and Schiffer.

         Effective as of March 25, 1987, the Company entered into the
Management Agreement with LREC. As a consultant to the Company and in
addition to the above services, LREC provides other services including, but
not limited to, strategic planning, marketing and financing as requested by
the Company. In consideration for these consulting services, the Company
pays LREC a quarterly consulting fee of one-tenth of one per cent of the
book value of the Company's assets, plus reasonable out-of-pocket expenses.
As of December 31, 2001, the book value of the Company's assets was
approximately $1.5 million. Consulting fees totaling $7,000 were accrued
during 2001 and the Company made payments of $9,000 in consulting fees in
2001. As of December 31, 2001, there were no unpaid fees, at December 31,
2000 a total of $2,000 unpaid fees had accrued under this agreement.

         The Management Agreement will continue in effect until terminated
upon 90 days prior written notice by a majority vote of the Company's
directors who have no financial interest in LREC or in any LREC affiliated
entity. Currently all directors have a financial interest in LREC or one of
its affiliates.

         Mr. Love receives a nominal salary from LREC. Although Mr. Schiffer
receives a salary from LREC, such salary compensates him for his services to
LREC, which provides consulting services for numerous other entities
affiliated with the Company, and none of the amount earned by LREC under the
Management Agreement is intended to be allocated or attributable to any
officer or employee, including Mr. Schiffer, of LREC. No part of Mr.
Schiffer's annual salary from LREC is directly attributable to the
management services he performs for the Company as an employee of LREC
pursuant to the Management Agreement.

         In 1989, the Company sold an aggregate $2,282,451 principal amount
of the Convertible Debentures in a private placement to Love-1989. The
general partner of Love-1989 is Love Investment Company, which is owned by
Mr. Love, Love family members and trusts, the Estate of Martha Love
Symington and Mr. Schiffer. The above purchase by Love-1989 of the
Debentures was funded in part with a loan from L-PGI. Love-1989 has since
repaid the debt to L-PGI in full, in part by transferring a portion of the
Debentures held by Love-1989 to L-PGI. In July 1992, as partial
consideration for the Company's conveyance of 350 acres of property to
L-PGI, the Company retired $782,000 in principal amount of the Debentures
held by L-PGI together with $389,000 in accrued interest. The maturity date
on all of the remaining Debentures was extended to July 8, 1997 so that the
Debentures are in default.


                                    -34-


<PAGE>
<PAGE>

         The Debentures were in part collateralized by a second mortgage in
favor of Love-1989 on 650 acres of the Property owned by the Company, which
was sold in May 1998. The 350 acres transferred to L-PGI as described above
were also included in the Property sold. Messrs. Love and Schiffer have
caused the Company to grant a second mortgage on the Retained Acreage to
Love-1989 and in their capacities as control persons of Love-1989, they
caused Love-1989 to release its second mortgage on the 650 acres of the
Property sold and they caused the Company to grant a security interest to
Love-1989 behind that held by PGIP in the restricted proceeds escrow which
is under the control of Messrs. Love and Schiffer since they and a company
they control are the managers of PGIP.

         As of December 31, 2001, Love-1989 held $796,950 in principal
amount of the Debentures with respect to which there was at that date
accrued and unpaid interest in the amount of $3,573,000. In 1990, $703,050
principal amount of the Debentures was transferred by Love-1989 to one of
its (now former) limited partners. That former limited partner continues to
hold such Debentures and as of December 31, 2001 there was accrued and
unpaid interest with respect thereto in the amount of $3,092,000.

         In 1985, a corporation owned by Alfred M. Johns, the former
Chairman of the Company, and his family made an uncollateralized loan to the
Company, which at December 31, 2001 had an outstanding balance, excluding
accrued interest, of $176,000. Besides being a direct owner of Common and
Preferred Stock, Mr. Johns has no other direct or indirect affiliations with
the Company.

         From time to time, the Company invests in short term debt
obligations of an affiliated holding company. An investment of $250,000 was
made in January 2001 and repaid in August 2001, plus interest at the prime
rate amounting to $10,000 for the period January to August, 2001.

         The Company also invested in short term obligations with an
affiliate of L-PGI, the Company's preferred shareholder, Love Investment
Company, in the fourth quarter of 2001. The balance receivable at
December 31, 2001 was $100,000. Interest paid on the loans was $3,000
in 2001 for the period October through December 2001.

         Love Investment Company made uncollateralized loans to the Company,
with a balance of $15,000 at December 31, 1999. The loan plus accrued
interest was paid off on February 28, 2000. Interest charged on the loan was
$1,000 for August, 1999 through February, 2000.

         The Company believes that the affiliated transactions are on terms
comparable to those, which would be obtained from unaffiliated persons.


                                    -35-


<PAGE>
<PAGE>

                                  PART IV
                                  -------

Item 13.          Exhibits, Financial Statement Schedules & Reports on Form 8-K
--------          -------------------------------------------------------------
         Form 10-KSB
(a) 1.   Financial Statements                                       Page Number
         Reports of Independent Accountants                              11
                                                                         --
         Consolidated Statements of Financial Position
           December 31, 2001 and 2000                                    12
                                                                         --
         Consolidated Statements of Operations Years Ended
           December 31, 2001 and 2000                                    13
                                                                         --
         Consolidated Statements of Cash Flows Years Ended
           December 31, 2001 and 2000                                  14-15
                                                                       -----
         Consolidated Statements of Stockholders' Deficiency
           Years Ended December 31, 2001 and 2000                        16
                                                                         --
         Notes to Consolidated Financial Statements                    17-30
                                                                       -----

(a) 2.   Exhibits
         Reference is made to the Exhibit Index contained on pages 38 to 42
         herein for a list of exhibits including each management contract,
         compensatory plan or arrangement required to be filed under this
         Item.

(b)      Reports on Form 8-K.
         Form 8-K/A, with exhibits, related to the Company's change of
         auditors, was filed December 14, 2001, and is incorporated herein
         by reference.


                                    -36-


<PAGE>
<PAGE>

                                 SIGNATURES
                                 ----------

Pursuant to the requirements of Section 13 or 15(d) 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, in the
County of St. Louis, State of Missouri, on this 14th day of May, 2002.

                                          PGI INCORPORATED
                                          (Registrant)

                                          By: /s/ Laurence A. Schiffer
                                              ------------------------
                                          Laurence A. Schiffer, President

Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons in the capacities and
on the dates indicated.

Signature                    Title                            Date
---------                    -----                            ----

/s/ Andrew S. Love, Jr.      Chairman of the Board            May 14, 2002
------------------------     Secretary
Andrew S. Love, Jr.

/s/ Laurence A. Schiffer     Vice Chairman of the             May 14, 2002
------------------------     Board, President, Principal
Laurence A. Schiffer         Executive Officer, Principal
                             Financial Officer and
                             Principal Accounting Officer


                                    -37-


<PAGE>
<PAGE>

EXHIBIT INDEX

2.       Inapplicable.

3.1      Articles of Incorporation (filed as Exhibit 3.1 to Registrant's
         Form 10-K Annual Report for the year ended December 31, 1980 and
         incorporated herein by reference).

3.2      Certificate of the Designation, Powers, Preferences and Relative
         Rights, and the Qualifications, Limitations or Restrictions
         Thereof, which have not been set forth in the Articles of
         Incorporation, of the Class A Cumulative Convertible Preferred
         Stock, effective as of March 24, 1987 (filed as Exhibit 3.2
         to Registrant's Form 10-K Annual Report for the year ended
         December 31, 1986 ("1986 Form 10-K") and incorporated herein by
         reference).

3.3      Bylaws of Registrant, as amended September 1987 (filed as
         Exhibit 3.3 to Registrant's original Form 10-K Annual Report for
         the year ended December 31, 1997 ("Original 1987 Form 10-K") dated
         as of March 29, 1987 and incorporated herein by reference).

3.4      Amendments to the Articles of Incorporation effective March 13,
         1990 and July 27, 1990, dated as of November 13, 1990 (filed as
         Exhibit 19 to the September 30, 1990 Form 10-Q and incorporated
         herein by reference).

3.5      Amendments to the Bylaws of the Registrant by the Board of
         Directors of PGI Incorporated by the Unanimous Written Consent,
         dated as of March 17, 1995 (filed as Exhibit 3.5 to the
         December 31, 1995 Form 10-KSB and incorporated herein by reference).

3.6      Articles of Incorporation of PGI Incorporated as amended through
         December 22, 1997 (filed as Exhibit 3.1 to Registrant's June 30,
         1998 Form 10-QSB and incorporated herein by reference).

3.7      Restated Articles of Incorporation of PGI Incorporated executed
         September 4, 1998 with certificate from the State of Florida
         dated October 27, 1998 (filed as Exhibit 3.1 to Registrant's
         September 30, 1998 Form 10-QSB and incorporated herein by reference).

4.1      Extension and Forbearance Agreement among PGI Incorporated, Punta
         Gorda Developers, Inc., Burnt Store Marina, Inc., and Gulf Coast
         Credit Corporation and BancFlorida (formerly Naples Federal Savings
         and Loan Association), dated as of March 25, 1987 (filed as
         Exhibit 4.4 to the 1986 Form 10-K and incorporated herein by
         reference).


                                    -38-


<PAGE>
<PAGE>

4.2      Seventh Mortgage and Loan Modification Agreement among PGI
         Incorporated, Punta Gorda Developers, Inc., Burnt Store Marina,
         Inc., and Gulf Coast Credit Corporation and BancFlorida, dated as
         of March 25, 1987 (filed as Exhibit 4.5 to the 1986 Form 10-K and
         incorporated herein by reference).

4.3      Eighth Mortgage and Loan modification Agreement among PGI
         Incorporated, Punta Gorda Developers, Inc., Burnt Store Marina,
         Inc., and Gulf Coast Credit Corporation and BancFlorida, dated as
         of March 25, 1987 (filed as Exhibit 4.6 to the 1986 Form 10-K and
         incorporated herein by reference).

4.4      Restated Loan and Security Agreement among PGI Incorporated, Punta
         Gorda Developers, Inc., Burnt Store Marina, Inc., and Gulf Coast
         Credit Corporation and BancFlorida, as well as Restated Consolidating
         Substituted Renewal Note and Future Advance Mortgage Note related
         thereto, dated as of March 25, 1987 (filed as Exhibit 4.7 to the
         1986 Form 10-K and incorporated herein by reference).

4.5      Forbearance Agreement among PGI Incorporated, Punta Gorda
         Developers, Inc., Burnt Store Marina, Inc., and Gulf Coast Credit
         Corporation and BancFlorida (Restated Loan Agreement No.1), dated
         as of October 19, 1985 (filed as Exhibit 4.1 to the Registrant's
         Form 10-Q Quarterly Report for the quarter ended September 30, 1985
         and incorporated herein by reference).

4.6      Amendment to Restated Loan Agreement No. 1 (Receivables Loan), as
         well as Restated Consolidating Substituted Renewal Note relating
         thereto, dated as of March 25, 1987 (filed as Exhibit 4.9 to the
         1986 Form 10-K and incorporated herein by reference).

4.7      Extension, Forbearance and Modification Agreement between PGI
         Incorporated, Punta Gorda Developers, Inc., Burnt Store Marina,
         Inc., and Gulf Coast Credit Corporation, and BancFlorida, dated as
         of May 20, 1988 (filed as Exhibit 4.1 to the Registrant's Form 10-Q
         Quarterly Report for the quarter ended June 30, 1988 and
         incorporated herein by reference).

4.8      Ninth Mortgage and Loan Modification Agreement between PGI
         Incorporated, Punta Gorda Developers, Inc., Burnt Store Marina,
         Inc., and Gulf Coast Credit Corporation, and BancFlorida, dated as
         of May 20, 1988 (filed as Exhibit 4.2 to Registrant's Form 10-Q
         Quarterly Report for the quarter ended June 30, 1988 and
         incorporated herein by reference).

4.9      Purchase Agreement among Finova Financial Services, PGI
         Incorporated and Punta Gorda Developers, Inc., as well as certain
         Exhibits and the Mortgage related thereto, dated March 15, 1988
         (filed as Exhibit 1 to Registrant's Form 8-K dated as of March 28,
         1988 and incorporated herein by reference).


                                    -39-


<PAGE>
<PAGE>

4.10     Tenth Mortgage and Loan Modification Agreement between PGI
         Incorporated, Punta Gorda Developers, Inc., as well as certain
         Exhibits and the Mortgage related thereto, dated May 30, 1989
         (filed as Exhibit 1 to Registrant's Form 8-K dated as of June 8,
         1989 and incorporated herein by reference).

4.11     Eleventh Mortgage and Loan Modification among PGI Incorporated
         (formerly Punta Gorda Isles, Inc.), Sugarmill Woods, Inc. (formerly
         Punta Gorda Developers, Inc.), Burnt Store Marina, Inc. and Gulf
         Coast Credit Corporation and BancFlorida (formerly Naples Federal
         Savings and Loan Association), dated as of June 1, 1990 (filed as
         Exhibit 4.2 to Registrant's Form 10-Q Quarterly Report for the
         quarter ended June 30, 1990 and incorporated herein by reference).

4.12     Loan Forbearance Agreement among PGI Incorporated (formerly Punta
         Gorda Isles, Inc.), Sugarmill Woods, Inc, (formerly Punta Gorda
         Developers, Inc.), Burnt Store Marina, Inc. and Gulf Coast Credit
         Corporation and BancFlorida (formerly Naples Federal Savings
         and Loan Association), dated as of October 17, 1991 (filed as
         Exhibit 4.12 to Registrant's Form 10-K dated March 30, 1994 and
         incorporated herein by reference).

4.13     Twelfth mortgage and loan modification among PGI Incorporated,
         Sugarmill Woods, Inc., Burnt Store Marina, Inc. and Gulf Coast
         Credit Corporation and BancFlorida, dated as of July 8, 1992 (filed
         as Exhibit 4.1 to Registrant's Form 8-K dated as of July 24, 1992,
         and incorporated herein by reference).

4.14     Thirteenth mortgage and loan modification agreement among PGI
         Incorporated, Sugarmill Woods, Inc., Burnt Store Marina, Inc., Gulf
         Coast Credit Corporation and First Union, dated as of May 13, 1994
         (filed as Exhibit 4.1 to Registrant's Form 8-K dated May 27, 1994
         and incorporated herein by reference).

4.15     Forbearance Agreement dated as of October 12, 1995 by First Union
         National Bank of Florida, PGI Incorporated, Sugarmill Woods, Inc.,
         Burnt Store Marina, Inc., Gulf Coast Credit Corporation, Southern
         Woods, Incorporated, Punta Gorda Isles, Inc., Deep Creek Utilities,
         Inc., Burnt Store Utilities, Inc., and Sugarmill Woods Sales, Inc.
         (filed as Exhibit 4(i) to Registrant's Form 8-K on November 1, 1995
         and incorporated herein by reference).

4.16     Note and Loan Document Purchase Agreement dated as of October 12,
         1995 by First Union National Bank of Florida, PGIP, L.L.C., PGI
         Incorporated, Sugarmill Woods, Inc., Burnt Store Marina, Inc., and
         Gulf Coast Credit Corporation (filed as Exhibit 4 (ii) to
         Registrant's Form 8-K on November 1, 1995 and incorporated herein
         by reference).

                                    -40-


<PAGE>
<PAGE>

4.17     Note Purchase and Loan Transaction dated as of March 28, 1996, by
         First Union National Bank of Florida, PGIP, LLC, PGI Incorporated,
         Sugarmill Woods, Inc., Burnt Store Marina, Inc. and Gulf Coast
         Credit Corporation (filed as Exhibit 4.17 to Registrant's
         Form 10-KSB/A dated August 27, 1997, and incorporated herein
         by reference).

10.      Inapplicable.

10.1     PGI Incorporated Restated 1981 Incentive Stock Option Plan, as
         amended (filed as Exhibit 10.1 to the Original 1987 Form 10-K and
         incorporated herein by reference).

10.2     PGI Incorporated 1987 Non-Qualified Stock Option and Stock
         Appreciation Rights Plan (filed as Exhibit 10.2 to the Original
         1987 Form 10-K and incorporated herein by reference).

10.3     Preferred Stock Purchase Agreement by and between PGI Incorporated
         and Love Development and Investment Company, dated as of February 16,
         1987 (filed as Exhibit (i) to the Registrant's Form 8-K Current
         Report dated February 25, 1987 and incorporated herein by
         reference).

10.4     Form of Convertible Debenture Agreement due April 30, 1992 between
         PGI Incorporated and Love-1989 Florida Partners, L.P. and Mortgage
         and Security Agreement dated July 28, 1989 between Sugarmill Woods,
         Inc. and Love-1989 Florida Partners, L.P. (filed as Exhibit 10.9 to
         the Registrant's Form 10-K Annual Report for the year ended
         December 31, 1989 and incorporated herein by reference).

10.5     Consulting Agreement between PGI Incorporated and Love Real Estate
         Company, dated as of March 25, 1987 (filed as Exhibit 10.7 to the
         1986 Form 10-K and incorporated herein by reference).

10.6     Option Agreement For Sale and Purchase dated January 31, 1997,
         between Sugarmill Woods, Inc., Love-PGI Partners, L.P., and The
         Nature Conservancy (filed as Exhibit 10.6 to Registrant's
         Form 10-KSB/A dated August 27, 1997 and incorporated herein
         by reference).

10.7     First Amendment to Option Agreement for Sale and Purchase dated
         August 25, 1997 between Sugarmill Woods, Inc., Love-PGI Partners,
         L.P., and The Nature Conservancy (filed as part of Appendix B to
         Registrant's Proxy Statement dated December 8, 1997 and
         incorporated herein by reference).


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10.8     Second Amendment to Option Agreement for Sale and Purchase dated
         September 29, 1997 between Sugarmill Woods, Inc., Love-PGI
         Partners, L.P., and The Nature Conservancy (filed as part of
         Appendix B to Registrant's Proxy Statement dated December 8, 1997
         and incorporated herein by reference).

11.      See Note 18 to the consolidated financial statements.

13.      Inapplicable.

16.      BDO Seidman's letter to the SEC dated December 11, 2001 filed
         December 14, 2001 as Exhibit 16.1 to the Registrant's amendment to
         Form 8-K and incorporated herein by reference.

18.      Inapplicable.

21.      Subsidiaries of the Registrant, filed herein.

22.      Inapplicable.

23.      Consent of Independent Accountants, filed herein.

24.      Inapplicable.

99.      Inapplicable.


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