Note 12. Subsequent Events

On July 11, 2012, the Company made an interest payment of approximately $225,000 to the IRS finalizing obligations related to the May 16, 2012 settlement with IRS Appeals for the tax years 2005 through 2007. See Note 5. Income Taxes.

On July 25, 2012, Alico-Agri reached an agreement with Private Equity Group, LLC to sell three parcels of land in Lee County, Florida totaling approximately 5,200 acres. The sales price of the property is $10,000,000 and the closings are scheduled on July 25, 2012 and October 3, 2012.

The Company recorded an impairment loss of approximately $1,868,000 on the Lee County Properties during the quarter ended June 30, 2012. During the third quarter ended June 30, 2012, management committed to a plan to sell the Properties and actively locate a buyer, thereby meeting the criteria for assets held for sale. The Company entered into a sales contract for the Properties on July 25, 2012, which triggered the impairment of the Properties based on the negotiated sales price. See Note 4. Property, Building and Equipment, Net.

In July 2012, the Company's Board of Directors authorized management to proceed with a plan to acquire and permit land to construct the initial phase of a citrus tree nursery in North Central Florida.