-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tmd8JW0LfpRBT4HzurKOlyIt3XycsHzj/oUhWDIBBkdFXnR/4huIOW0TUlrkHU9T 4Y3NRoQDzSGAkyEzdrSq8w== 0000950134-97-001705.txt : 19970312 0000950134-97-001705.hdr.sgml : 19970312 ACCESSION NUMBER: 0000950134-97-001705 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19961213 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970311 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONTINENTAL MORTGAGE & EQUITY TRUST CENTRAL INDEX KEY: 0000319416 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 942738844 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-10503 FILM NUMBER: 97554500 BUSINESS ADDRESS: STREET 1: 10670 N CENTRAL EXPWY STE 300 CITY: DALLAS STATE: TX ZIP: 75231 BUSINESS PHONE: 2146924700 FORMER COMPANY: FORMER CONFORMED NAME: CONSOLIDATED CAPITAL SPECIAL TRUST DATE OF NAME CHANGE: 19901122 8-K/A 1 AMENDMENT NO. 2 TO FORM 8-K 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K/A AMENDMENT NO. 2 CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 December 13, 1996 --------------------------------------------------- Date of Report (Date of Earliest Event Reported) CONTINENTAL MORTGAGE AND EQUITY TRUST ---------------------------------------------------------- (Exact Name of Registrant as Specified in its Charter) California 0-10503 94-2738844 - -------------------------------------------------------------------------------- (State of Incorporation) (Commission (IRS Employer File No.) Identification No.) 10670 North Central Expressway, Suite 300, Dallas, TX 75231 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, Including Area Code: (214) 692-4700 --------------- Not Applicable ---------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) 1 2 This Form 8-K/A Amendment No. 2 amends the Registrant's current report on Form 8-K/A dated December 13, 1996 as filed with the Securities and Exchange Commission on February 11, 1997. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS - pages 6 through 19. 3 CONTINENTAL MORTGAGE AND EQUITY TRUST PRO FORMA STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 1996
Northpoint 2626 Cole Other Oak Run Office Office Property Property Actual Apartments(1) Building(1) Building(1) Acquisitions(1) Dispositions(1) Pro forma ------------ ------------- ------------ ------------ --------------- -------------- ------------ (dollars in thousands, except per share) Income Rents ................... $ 33,205 $ 662 $ 1,411 $ 1,175 $ 5,770 $ (3,926) $ 38,297 Interest ................ 821 -- -- -- -- -- 821 ------------ ------------ ------------ ------------ ------------ ------------ ------------ 34,026 662 1,411 1,175 5,770 (3,926) 39,118 Expenses Property operations ..... 20,091 465 871 550 3,192 (2,560) 22,609 Interest ................ 9,317 174 410 439 1,827 (1,079) 11,088 Depreciation ............ 3,565 59 133 136 644 (461) 4,076 Provision for losses .... (884) -- -- -- -- -- (884) Advisory fee to affiliate ............ 1,300 -- -- -- -- -- 1,300 General and administrative ....... 1,400 -- -- -- -- -- 1,400 ------------ ------------ ------------ ------------ ------------ ------------ ------------ 34,789 698 1,414 1,125 5,663 (4,100) 39,589 ------------ ------------ ------------ ------------ ------------ ------------ ------------ Income (loss) from operations .............. (763) (36) (3) 50 107 174 (471) Equity in income of partnerships ............ 197 -- -- -- -- -- 197 Gain on sale of real estate .................. 9,397 -- -- -- -- -- 9,397 ------------ ------------ ------------ ------------ ------------ ------------ ------------ Income (loss) before extraordinary gain ...... 8,831 (36) (3) 50 107 174 9,123 Extraordinary gain ......... 812 -- -- -- -- -- 812 ------------ ------------ ------------ ------------ ------------ ------------ ------------ Net income (loss) .......... $ 9,643 $ (36) $ (3) $ 50 $ 107 $ 174 $ 9,935 ============ ============ ============ ============ ============ ============ ============ Earnings per share Net income before extraordinary gain ... $ 2.08 $ 2.15 Extraordinary gain ...... .20 .20 ------------ ------------ Net income .............. $ 2.28 $ 2.35 ============ ============ Shares of beneficial interest outstanding .... 4,243,754 4,243,754 ============ ============
- ------------------ (1) Assumes acquisition or disposition by the Trust on January 1, 1996. Pro forma amounts for other property acquisitions are from January 1 through the date of acquisition only, results subsequent to the date of acquisition are included in the "Actual" column. 6 4 CONTINENTAL MORTGAGE AND EQUITY TRUST PRO FORMA STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1995
Northpoint 2626 Cole Other Oak Run Office Office Property Property Actual Apartments(1) Building(1) Building(1) Acquisitions(1) Dispositions(1) Pro forma ------------ ------------- ------------ ------------ --------------- --------------- ----------- (dollars in thousands, except per share) Income Rents ................... $ 37,586 $ 882 $ 1,881 $ 1,566 $ 7,694 $ (7,339) $ 42,270 Interest ................ 723 -- -- -- -- -- 723 ------------ ------------ ------------ ------------ ------------ ------------ ------------ 38,309 882 1,881 1,566 7,694 (7,339) 42,993 Expenses Property operations ..... 22,682 620 1,161 734 4,255 (4,442) 25,010 Interest ................ 10,009 232 546 584 2,434 (1,990) 11,815 Depreciation ............ 4,279 79 177 182 859 (950) 4,626 Advisory fee to affiliate ............ 1,264 -- -- -- -- -- 1,264 General and administrative ....... 1,207 -- -- -- -- -- 1,207 Provision for losses .... 541 -- -- -- -- -- 541 ------------ ------------ ------------ ------------ ------------ ------------ ------------ 39,982 931 1,884 1,500 7,548 (7,382) 44,463 ------------ ------------ ------------ ------------ ------------ ------------ ------------ Income (loss) from operations .............. (1,673) (49) (3) 66 146 43 (1,470) Equity in income of partnerships ............ 230 -- -- -- -- -- 230 ------------ ------------ ------------ ------------ ------------ ------------ ------------ Net income (loss) .......... $ (1,443) $ (49) $ (3) $ 66 $ 146 $ 43 $ (1,240) ============ ============ ============ ============ ============ ============ ============ Earnings per share Net income .............. $ (.33) $ (.28) ============ ============ Shares of beneficial interest outstanding .... 4,377,165 4,377,165 ============ ============
- ------------------ (1) Assumes acquisition or disposition by the Trust on January 1, 1995. 7 5 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (Continued) (b) Financial statements of properties acquired:
Exhibit Number Description - ------- ----------------------------------------------------------- 99.0 Oak Run Apartments Audited Statement of Revenues and Direct Operating Expenses for the year ended December 31, 1995. 99.1 Northpoint Central Office Building Audited Statement of Revenues and Direct Operating Expenses for the year ended December 31, 1995. 99.2 2626 Cole Office Building Audited Statement of Revenues and Direct Operating Expenses for the Year Ended December 31, 1995.
-------------- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereto duly authorized. CONTINENTAL MORTGAGE AND EQUITY TRUST Date: March 11, 1997 By: /s/ Thomas A. Holland ---------------------- ----------------------------- Thomas A. Holland Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) 8 6 CONTINENTAL MORTGAGE AND EQUITY TRUST EXHIBIT TO ITS CURRENT REPORT ON FORM 8-K Dated December 13, 1996
Exhibit Page Number Description Number - ------- ----------------------------------------------- ------ 99.0 Oak Run Apartments Audited Statement of 10 Revenues and Direct Operating Expenses for the year ended December 31, 1995. 99.1 Northpoint Central Office Building Audited 12 Statement of Revenues and Direct Operating Expenses for the year ended December 31, 1995. 99.2 2626 Cole Office Building Audited Statement 16 of Revenues and Direct Operating Expenses for the year ended December 31, 1995.
EX-99.0 2 OAK RUN AUDITED STATEMENT OF REVENUES 1 EXHIBIT 99.0 [ANDREW V. SCHNURR & CO. LETTERHEAD] December 11, 1996 Philip Edmundson, Trustee Capital Advantage Group 510 Bering Drive, Suite 300 Houston, Texas 77057 Dear Mr. Edmundson: We have audited the accompanying statement of revenues and direct operating expenses of Oak Run Manor for the year ended December 31, 1995. This statement of revenues and direct operating expenses is the responsibility of the Property's management. Our responsibility is to express an opinion on this statement of revenues and direct operating expenses based upon our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of revenues and direct operating expenses is free of material misstatement. An audit included examining, on a test basis, evidence supporting the amounts and disclosures in the statement of revenues and direct operating expenses. An audit also includes assessing the accounting principles used by management, as well as evaluating the overall statement of revenues and direct operating expenses presentation. We believe our audit provides a reasonable basis for our opinion. In our opinion, the statement of revenues and direct operating expenses referred to above presents fairly, in all material respects, the revenues and direct operating expenses of Oak Run Manor for the year ended December 31, 1995, in conformity with generally accepted accounting principles. Respectfully submitted, /s/ ANDREW V. SCHNURR & CO. ------------------------------ Andrew V. Schnurr & Co. 10 2 OAK RUN MANOR STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1995 INCOME ------ Rental Income $879,170. Interset Income, Late Charges, Etc. 2,758. --------- TOTAL INCOME 881,928. ------------ DIRECT EXPENSES --------------- Advertising $18,908. Office Expenses 14,461. Management Fees 42,267. Legal & Accounting 4,645. Telephone 3,373. Janitor Payroll 81,571. Electric 9,189. Water & Sewer 53,331. Exterminating 1,018. Hospitalization 3,828. Repairs - Materials 170,852. Decorating Supplies & Contracts 33,916. Taxes - Real Estate 128,756. - Payroll 10,181. Insurance - Hazard 20,602. Gardening 22,802. Bank Charges 291. -------- TOTAL DIRECT EXPENSES 619,991. --------------------- --------- NET REVENUE $261,937. ----------- =========
11 EX-99.1 3 NORTHPOINT AUDITED STATEMENT OF REVENUES 1 EXHIBIT 99.1 NORTHPOINT CENTRAL STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES Year Ended December 31, 1995 12 2 Independent Auditors' Report To the Board of Trustees Continental Mortgage and Equity Trust We have audited the accompanying statement of revenues and direct operating expenses of Northpoint Central for the year ended December 31, 1995. This statement of revenues and direct operating expenses is the responsibility of the Property's management. Our responsibility is to express an opinion on this statement of revenues and direct operating expenses based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of revenues and direct operating expenses is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement of revenues and direct operating expenses. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall statement of revenues and direct operating expenses presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying financial statement is prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in Form 8-K of Continental Mortgage and Equity Trust) and, as described in Note 1, is not intended to be a complete presentation of the results of operations. In our opinion, the statement of revenues and direct operating expenses referred to above presents fairly, in all material respects, the revenues and direct operating expenses of Northpoint Central for the year ended December 31, 1995, in conformity with generally accepted accounting principles. Farmer, Fuqua, Hunt & Munselle, P.C. Dallas, Texas February 5, 1997 13 3 NORTHPOINT CENTRAL STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES Year Ended December 31, 1995 REVENUES Net rental revenues $ 1,751,402 Other revenues 40,413 -------------- Total revenues 1,791,815 OPERATING EXPENSES Repairs and maintenance 376,315 Utilities 233,611 Property taxes 203,916 Salaries and benefits 119,222 Insurance 27,829 -------------- Total direct operating expenses 960,893 -------------- REVENUES IN EXCESS OF DIRECT OPERATING EXPENSES $ 830,922 ==============
The accompanying notes are an integral part of this statement. 14 4 NORTHPOINT CENTRAL STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES Year ended December 31, 1995 NOTE 1: ORGANIZATION AND BASIS OF PRESENTATION Northpoint Central is a 176,043 square-foot office building, located in Houston, Texas. During 1996, the property was owned by Alpha Northpoint Associates, L.P. The accompanying financial statement does not include a provision for depreciation and amortization, bad debt expense, interest expense or income taxes. Accordingly, this statement is not intended to be a complete presentation of the results of operations. NOTE 2: OTHER REVENUES Other revenues consist of the following: Rent escalations $ 36,196 Miscellaneous 4,217 ------------- $ 40,413 =============
NOTE 3: 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE 4: SUBSEQUENT EVENT The property was sold to Continental Mortgage and Equity Trust, a California business trust, on December 27, 1996. 15 EX-99.2 4 2626 COLE AUDITED STATEMENT OF REVENUES 1 EXHIBIT 99.2 2626 COLE STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES Year Ended December 31, 1995 16 2 Independent Auditors' Report To the Board of Trustees Continental Mortgage and Equity Trust We have audited the accompanying statement of revenues and direct operating expenses of 2626 Cole for the year ended December 31, 1995. This statement of revenues and direct operating expenses is the responsibility of the Property's management. Our responsibility is to express an opinion on this statement of revenues and direct operating expenses based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of revenues and direct operating expenses is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement of revenues and direct operating expenses. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall statement of revenues and direct operating expenses presentation. We believe that our audit provides a reasonable basis for our opinion. The accompanying financial statement is prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in Form 8-K of Continental Mortgage and Equity Trust) and, as described in Note 1, is not intended to be a complete presentation of the results of operations. In our opinion, the statement of revenues and direct operating expenses referred to above presents fairly, in all material respects, the revenues and direct operating expenses of 2626 Cole for the year ended December 31, 1995, in conformity with generally accepted accounting principles. Farmer, Fuqua, Hunt & Munselle, P.C. Dallas, Texas February 18, 1997 17 3 2626 COLE STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES Year Ended December 31, 1995 REVENUES Net rental revenues $ 1,452,889 Other revenues 113,410 -------------- Total revenues 1,566,299 OPERATING EXPENSES Repairs and maintenance 259,264 Utilities 247,564 Property taxes 136,312 Salaries and benefits 73,453 Insurance 17,307 -------------- Total direct operating expenses 733,900 -------------- REVENUES IN EXCESS OF DIRECT OPERATING EXPENSES $ 832,399 ==============
The accompanying notes are an integral part of this statement. 18 4 2626 COLE STATEMENT OF REVENUES AND DIRECT OPERATING EXPENSES Year ended December 31, 1995 NOTE 1: ORGANIZATION AND BASIS OF PRESENTATION 2626 Cole is a 119,632 square-foot office building, located in Dallas, Texas. During 1995, the property was owned by Amerus Properties, Inc. The accompanying financial statement does not include a provision for depreciation and amortization, bad debt expense, interest expense or income taxes. Accordingly, this statement is not intended to be a complete presentation of the results of operations. NOTE 2: OTHER REVENUES Other revenues consist of the following: Common area maintenance $ 76,021 Miscellaneous 37,389 -------------- $ 113,410 ==============
NOTE 3: 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE 4: SUBSEQUENT EVENT The property was sold to Continental Mortgage and Equity Trust, a California business trust, on December 31, 1996. 19 -----END PRIVACY-ENHANCED MESSAGE-----