10QSB 1 0001.txt FORM 10-QSB FORM 10-QSB--QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Quarterly or Transitional Report U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-QSB (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000 [ ] 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 0-14099 CONSOLIDATED CAPITAL PROPERTIES VI (Exact name of small business issuer as specified in its charter) California 94-2940204 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 55 Beattie Place, PO Box 1089 Greenville, South Carolina 29602 (Address of principal executive offices) (864) 239-1000 (Issuer's telephone number) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Partnership was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No___ PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS a) CONSOLIDATED CAPITAL PROPERTIES VI CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands, except unit data) September 30, 2000
Assets Cash and cash equivalents $ 656 Receivables and deposits 139 Other assets 139 Investment property: Land $ 916 Buildings and related personal property 9,725 10,641 Less accumulated depreciation (4,689) 5,952 $ 6,886 Liabilities and Partners' (Deficit) Capital Liabilities Accounts payable $ 14 Tenant security deposit liabilities 83 Accrued property taxes 101 Other liabilities 115 Mortgage note payable 5,507 Partners' (Deficit) Capital General partner $ (1) Special limited partners (73) Limited partners (181,300 units issued and outstanding) 1,140 1,066 $ 6,886
See Accompanying Notes to Consolidated Financial Statements b) CONSOLIDATED CAPITAL PROPERTIES VI CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data)
Three Months Nine Months Ended September 30, Ended September 30, 2000 1999 2000 1999 Revenues: Rental income $ 423 $ 414 $ 1,281 $ 1,260 Other income 46 42 125 117 Total revenues 469 456 1,406 1,377 Expenses: Operating 200 225 588 548 General and administrative 67 42 152 126 Depreciation 104 68 325 255 Interest 109 109 371 327 Property taxes 34 29 109 83 Total expenses 514 473 1,545 1,339 Net (loss) income $ (45) $ (17) $ (139) $ 38 Net (loss) income allocated to general partner (0.2%) $ -- $ -- $ -- $ -- Net (loss) income allocated to limited partners (99.8%) (45) (17) (139) 38 $ (45) $ (17) $ (139) $ 38 Net (loss) income per limited partnership unit $ (0.25) $ (0.09) $ (0.77) $ 0.21
See Accompanying Notes to Consolidated Financial Statements c) CONSOLIDATED CAPITAL PROPERTIES VI CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL (Unaudited) (in thousands, except unit data)
Limited Special Partnership General Limited Limited Units Partner Partners Partners Total Original capital contributions 181,808 $ 1 $ -- $45,452 $45,453 Partners' (deficit) capital at December 31, 1999 181,300 $ (1) $ (79) $ 1,285 $ 1,205 Amortization of timing difference -- -- 6 (6) -- Net loss for the nine months ended September 30, 2000 -- -- -- (139) (139) Partners' (deficit) capital at September 30, 2000 181,300 $ (1) $ (73) $ 1,140 $ 1,066
See Accompanying Notes to Consolidated Financial Statements d) CONSOLIDATED CAPITAL PROPERTIES VI CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Nine Months Ended September 30, 2000 1999 Cash flows from operating activities: Net (loss) income $ (139) $ 38 Adjustments to reconcile net (loss) income to net cash provided by operating activities: Depreciation 325 255 Amortization of loan costs 5 19 Change in accounts: Receivables and deposits 86 101 Other assets 3 (20) Accounts payable (23) 95 Tenant security deposit liabilities 4 10 Accrued property taxes (19) (27) Other liabilities (104) (7) Net cash provided by operating activities 138 464 Cash flows from investing activities: Property improvements and replacements (234) (279) Net withdrawals from (deposits to) restricted escrows 135 (17) Net cash used in investing activities (99) (296) Cash flows from financing activities: Payments on mortgage notes payable (83) (53) Loan costs paid (35) -- Distributions paid to partners (2,297) -- Net cash used in financing activities (2,415) (53) Net (decrease) increase in cash and cash equivalents (2,376) 115 Cash and cash equivalents at beginning of period 3,032 1,862 Cash and cash equivalents at end of period $ 656 $ 1,977 Supplemental disclosure of cash flow information: Cash paid for interest $ 366 $ 308 Distributions to partners of approximately $2,297,000 was accrued at December 31, 1999 and paid in January 2000.
See Accompanying Notes to Consolidated Financial Statements e) CONSOLIDATED CAPITAL PROPERTIES VI NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note A - Basis of Presentation The accompanying unaudited consolidated financial statements of Consolidated Capital Properties VI (the "Partnership" or "Registrant") have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of ConCap Equities, Inc. ("CEI" or the "General Partner"), all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine month periods ended September 30, 2000, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2000. For further information, refer to the consolidated financial statements and footnotes thereto included in the Partnership's Annual Report on Form 10-KSB for the fiscal year ended December 31, 1999. Principles of Consolidation The Partnership's financial statements include the accounts of Colony of Springdale Associates, Ltd. ("Colony Associates"), which holds fee title to the Colony of Springdale Apartments. The results of its operations are included in the Partnership's consolidated financial statements. All inter-entity transactions between the Partnership and Colony Associates have been eliminated. Note B - Transfer of Control Pursuant to a series of transactions which closed on October 1, 1998 and February 26, 1999, Insignia Financial Group, Inc. and Insignia Properties Trust merged into Apartment Investment and Management Company ("AIMCO"), a publicly traded real estate investment trust, with AIMCO being the surviving corporation (the "Insignia Merger"). As a result, AIMCO acquired 100% ownership interest in the General Partner. The General Partner does not believe that this transaction has had or will have a material effect on the affairs and operations of the Partnership. Note C - Related Party Transactions The Partnership has no employees and is dependent on the General Partner and its affiliates for the management and administration of all Partnership activities. The Partnership Agreement provides for payments to affiliates for services and the reimbursement of certain expenses incurred by affiliates on behalf of the Partnership. The following expenses were paid or accrued to an affiliate of the General Partner during the nine months ended September 30, 2000 and 1999: 2000 1999 (in thousands) Property management fees (included in operating expenses) $ 69 $ 68 Reimbursement for services of affiliates (included in investment property and operating and general and administrative expenses) 85 44 During the nine months ended September 30, 2000 and 1999, affiliates of the General Partner were entitled to receive 5% of gross receipts from the Partnership's property as compensation for providing property management services. The Partnership paid to such affiliates approximately $69,000 and $68,000 for each of the nine months ended September 30, 2000 and 1999, respectively. An affiliate of the General Partner received reimbursement of accountable administrative expenses amounting to approximately $85,000 and $44,000 for the nine months ended September 30, 2000 and 1999, respectively. In addition to its indirect ownership of the general partner interest in the Partnership, AIMCO and its affiliates currently own 79,035 limited partnership units in the Partnership representing 43.593% of the outstanding units. A number of these units were acquired pursuant to tender offers made by AIMCO or its affiliates. It is possible that AIMCO or its affiliates will make one or more additional offers to acquire additional limited partnership interests in the Partnership for cash or in exchange for units in the operating partnership of AIMCO. In this regard, on August 2, 2000, an affiliate of AIMCO commenced a tender offer to purchase any and all of the remaining Partnership interest for a purchase price of $11.67 per limited partnership unit. As a result, the affiliate of AIMCO acquired 4,783 limited partnership units. Under the Partnership Agreement, unitholders holding a majority of the Units are entitled to take action with respect to a variety of matters, which would include without limitation, voting on certain amendments to the Partnership Agreement and voting to remove the General Partner. As a result of its ownership of 43.593% of the outstanding units, AIMCO is in a position to significantly influence all voting decisions with respect to the Registrant. When voting on matters, AIMCO would in all likelihood vote the Units it acquired in a manner favorable to the interest of the General Partner because of their affiliation with the General Partner. Note D - Commitment The Partnership is required to maintain working capital reserves for contingencies of not less than 5% of Net Invested Capital as defined in the Partnership Agreement. In the event expenditures are made from these reserves, operating revenue shall be allocated to such reserves to the extent necessary to maintain the foregoing level. Reserves, consisting of cash and cash equivalents, tenant security deposits and investments totaling approximately $782,000 are less than the reserve requirement of approximately $2,070,000 at September 30, 2000. On September 16, 2000, the Partnership sought the vote of limited partners to amend the Partnership Agreement to eliminate the requirement for the Partnership to maintain reserves equal to at least 5% of the limited partners' capital contributions less distributions to limited partners and instead permit the General Partner to determine reasonable reserve requirements of the Partnership. The vote was sought pursuant to a Consent Solicitation that expired on October 16, 2000 at which time the amendment was approved by the requisite percent of limited partnership interests. Upon expiration of the consent period, a total number of 110,551 units had voted of which 102,214 units had voted in favor of the amendment, 6,832 voted against the amendment and 1,505 units abstained. Note E - Change in Status of Non-Corporate General Partner During the year ended December 31, 1991, the Partnership Agreement was amended to convert the general partner interests held by the non-corporate general partner, Consolidated Capital Group II ("CCG"), to that of special limited partners ("Special Limited Partners"). The Special Limited Partners do not have a vote and do not have any of the other rights of a Limited Partner except the right to inspect the Partnership's books and records; however, the Special Limited Partners retained the economic interest in the Partnership which they previously owned as general partner. CEI became the sole general partner of the Partnership effective December 31, 1991. In connection with CCG's conversion, a special allocation of gross income was made to the Special Limited Partners in order to eliminate its tax basis negative capital account. After the conversion, the various Special Limited Partners transferred portions of their interests to CEI so that CEI now holds a .2% interest in all allocable items of income, loss and distribution. The differences between the Special Limited Partners' capital accounts for financial statement and tax reporting purposes are being amortized to the Limited Partners' capital accounts as the components of the timing differences which created the balance reverse. Note F - Distributions A distribution of approximately $2,297,000 (approximately $2,250,000 to the limited partners or $12.41 per limited partnership unit) was accrued during December 1999 and paid in January 2000. This distribution consisted of cash from operations of approximately $1,175,000 (approximately $1,128,000 to the limited partners or $6.22 per limited partnership unit) and refinancing proceeds of approximately $1,122,000 to the limited partners ($6.19 per limited partnership unit). No distributions were made during the nine months ended September 30, 1999. Note G - Segment Reporting Description of the types of products and services from which the reportable segment derives its revenues: The Partnership has one reportable segment: residential properties. The Partnership's residential property segment consists of one apartment complex in Ohio. The Partnership rents apartment units to tenants for terms that are typically twelve months or less. Measurement of segment profit or loss: The Partnership evaluates performance based on segment profit (loss) before depreciation. The accounting policies of the reportable segment are the same as those of the Partnership as described in the Partnership's Annual Report on Form 10-KSB for the year ended December 31, 1999. Segment information for the three and nine month periods ended September 30, 2000 and 1999 (in thousands) is shown in the tables below. The "Other" column includes Partnership administration related items and income and expense not allocated to the reportable segment. Three Months Ended September 30, 2000 Residential Other Totals Rental income $ 423 $ -- $ 423 Other income 42 4 46 Interest expense 109 -- 109 Depreciation 104 -- 104 General and administrative expense -- 67 67 Segment profit (loss) 18 (63) (45) Nine Months Ended September 30, 2000 Residential Other Totals Rental income $ 1,281 $ -- $ 1,281 Other income 102 23 125 Interest expense 371 -- 371 Depreciation 325 -- 325 General and administrative expense -- 152 152 Segment loss (10) (129) (139) Total assets 6,474 412 6,886 Capital expenditures for investment property 234 -- 234 Three Months Ended September 30, 1999 Residential Other Totals Rental income $ 414 $ -- $ 414 Other income 30 12 42 Interest expense 109 -- 109 Depreciation 68 -- 68 General and administrative expense -- 42 42 Segment profit (loss) 13 (30) (17) Nine Months Ended September 30, 1999 Residential Other Totals Rental income $ 1,260 $ -- $ 1,260 Other income 70 47 117 Interest expense 327 -- 327 Depreciation 255 -- 255 General and administrative expense -- 126 126 Segment profit (loss) 117 (79) 38 Total assets 6,568 1,812 8,380 Capital expenditures for investment property 279 -- 279 Note H - Legal Proceedings In March 1998, several putative unit holders of limited partnership units of the Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia Financial Group, Inc., et al. in the Superior Court of the State of California for the County of San Mateo. The plaintiffs named as defendants, among others, the Partnership, its General Partner and several of their affiliated partnerships and corporate entities. The action purports to assert claims on behalf of a class of limited partners and derivatively on behalf of a number of limited partnerships (including the Partnership) which are named as nominal defendants, challenging the acquisition of interests in certain general partner entities by Insignia Financial Group, Inc. ("Insignia") and entities which were, at one time, affiliates of Insignia; past tender offers by the Insignia affiliates to acquire limited partnership units; the management of partnerships by the Insignia affiliates; and the Insignia Merger. The plaintiffs seek monetary damages and equitable relief, including judicial dissolution of the Partnership. On June 25, 1998, the General Partner filed a motion seeking dismissal of the action. In lieu of responding to the motion, the plaintiffs have filed an amended complaint. The General Partner filed demurrers to the amended complaint which were heard February 1999. Pending the ruling on such demurrers, settlement negotiations commenced. On November 2, 1999, the parties executed and filed a Stipulation of Settlement, settling claims, subject to final court approval, on behalf of the Partnership and all limited partners who owned units as of November 3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999 from the Court, at which time the Court set a final approval hearing for December 10, 1999. Prior to the December 10, 1999 hearing, the Court received various objections to the settlement, including a challenge to the Court's preliminary approval based upon the alleged lack of authority of prior lead counsel to enter the settlement. On December 14, 1999, the General Partner and its affiliates terminated the proposed settlement. In February 2000, counsel for some of the named plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who negotiated the settlement. On June 27, 2000, the Court entered an order disqualifying them from the case. The Court is considering applications for lead counsel and has currently scheduled a hearing on the matter for November 20, 2000. The General Partner does not anticipate that costs associated with this case will be material to the Partnership's overall operations. The Partnership is unaware of any other pending or outstanding litigation that is not of a routine nature arising in the ordinary course of business. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The matters discussed in this Form 10-QSB contain certain forward-looking statements and involve risks and uncertainties (including changing market conditions, competitive and regulatory matters, etc.) detailed in the disclosures contained in this Form 10-QSB and the other filings with the Securities and Exchange Commission made by the Partnership from time to time. The discussion of the Partnership's business and results of operations, including forward-looking statements pertaining to such matters, does not take into account the effects of any changes to the Partnership's business and results of operation. Accordingly, actual results could differ materially from those projected in the forward-looking statements as a result of a number of factors, including those identified herein. The Partnership's investment property consists of one apartment complex, Colony of Springdale Apartments, located in Springdale, Ohio. The average occupancy for the nine month periods ended September 30, 2000 and 1999, was 92% and 94%, respectively. Results of Operations The Partnership realized a net loss of approximately $139,000 compared to net income of approximately $38,000 for the nine months ended September 30, 2000 and 1999, respectively. The Partnership realized a net loss of approximately $45,000 and $17,000 for the three months ended September 30, 2000 and 1999, respectively. The increase in net loss for the three and nine months ended September 30, 2000 is due to an increase in total expenses partially offset by an increase in total revenues. The increase in total expenses for the nine month period is due to increases in operating, general and administrative, depreciation, property tax, and interest expenses. The increase in total expenses for the three month period is due to increases in general and administrative and depreciation expenses partially offset by a decrease in operating expense. The increase in operating expense for the nine month period is due primarily to increased maintenance, insurance, and property expenses. Maintenance expense increased as a result of decreased insurance proceeds received for casualty loss repairs during the nine months ended September 30, 2000 compared to insurance proceeds received for casualty loss repairs during the nine months ended September 30, 1999. Insurance expense increased as a result of the timing of the insurance premium invoice which affected the timing of the accrual during the nine months ended September 30, 1999. Property expense increased as a result of increased salary, employee benefits, and utility expenses at Colony of Springdale Apartments. The decrease in operating expense for the three month period is due primarily to net insurance expense incurred for casualty repairs during the three months ended September 30, 1999. No such costs were incurred during the three months ended September 30, 2000. The increase in general and administrative expense is primarily due to an increase in the costs of services included in the management reimbursements to the General Partner as allowed under the Partnership Agreement. Costs associated with the quarterly and annual communications with investors and regulatory agencies and the annual audit required by the Partnership Agreement are also included at both September 30, 2000 and 1999. The increase in depreciation expense is due to the increase in fixed asset additions during 1999 and 2000. Interest expense increased due to increased interest paid during the nine months ended September 30, 2000 related to the refinancing of the Partnership's property during the fourth quarter of 1999 (see discussion below). The increase in total revenues resulted primarily from an increase in rental income as the result of an increase in average rental rates despite a slight decrease in occupancy. As part of the ongoing business plan of the Partnership, the General Partner monitors the rental market environment of its investment property to assess the feasibility of increasing rents, maintaining or increasing occupancy levels and protecting the Partnership from increases in expenses. As part of this plan, the General Partner attempts to protect the Partnership from the burden of inflation-related increases in expenses by increasing rents and maintaining a high overall occupancy level. However, due to changing market conditions, which can result in the use of rental concessions and rental reductions to offset softening market conditions, there is no guarantee that the General Partner will be able to sustain such a plan. Liquidity and Capital Resources At September 30, 2000, the Partnership had cash and cash equivalents of approximately $656,000 as compared to approximately $1,977,000 at September 30, 1999. For the nine months ended September 30, 2000, cash and cash equivalents decreased by approximately $2,376,000 from the Partnership's year ended December 31, 1999. The decrease in cash and cash equivalents is due to approximately $2,415,000 of cash used in financing activities and approximately $99,000 of cash used in investing activities slightly offset by approximately $138,000 of cash provided by operating activities. Cash used in financing activities consisted primarily of distributions to the partners and, to a lesser extent, loan costs paid, and principal payments made on the mortgage encumbering the Partnership's property. Cash used in investing activities consisted of property improvements and replacements partially offset by net withdrawals from restricted escrows maintained by the mortgage lender. The Partnership invests its working capital reserves in a money market account. The sufficiency of existing liquid assets to meet future liquidity and capital expenditure requirements is directly related to the level of capital expenditures required at the property to adequately maintain the physical asset and other operating needs of the Registrant and to comply with Federal, state, and local legal and regulatory requirements. Capital improvements planned for the Partnership's property are discussed below. During the nine month period ended September 30, 2000, the Partnership completed approximately $234,000 of budgeted and unbudgeted capital improvements at the property. These improvements consisted primarily of appliance and floor covering replacements, structural improvements, and roof replacements. These improvements were funded from operating cash flow and replacement reserves. Approximately $242,000 has been budgeted for capital improvements at Colony of Springdale for the year 2000 consisting primarily of floor coverings, sprinkler systems, plumbing enhancements, and heating units. Additional improvements may be considered and will depend on the physical condition of the property as well as replacement reserves and anticipated cash flow generated by the property. The capital expenditures will be incurred only if cash is available from operations or from Partnership reserves. To the extent that such budgeted capital improvements are completed, the Registrant's distributable cash flow, if any, may be adversely affected at least in the short term. The Partnership is required to maintain working capital reserves for contingencies of not less than 5% of Net Invested Capital as defined in the Partnership Agreement. In the event expenditures are made from these reserves, operating revenue shall be allocated to such reserves to the extent necessary to maintain the foregoing level. Reserves, consisting of cash and cash equivalents and tenant security deposits and investments totaling approximately $782,000 are less than the reserve requirement of approximately $2,070,000 at September 30, 2000. On September 16, 2000, the Partnership sought the vote of limited partners to amend the Partnership Agreement to eliminate the requirement for the Partnership to maintain reserves equal to at least 5% of the limited partners' capital contributions less distributions to limited partners and instead permit the General Partner to determine reasonable reserve requirements of the Partnership. The vote was sought pursuant to a Consent Solicitation that expired on October 16, 2000 at which time the amendment was approved by the requisite percent of limited partnership interests. Upon expiration of the consent period, a total number of 110,551 units had voted of which 102,214 units had voted in favor of the amendment, 6,832 voted against the amendment and 1,505 units abstained. On October 25, 1999, the Partnership refinanced the mortgage encumbering Colony of Springdale Apartments. Interest on the old mortgage was 9.5%. The refinancing replaced indebtedness of $4,247,000 with a new mortgage in the amount of $5,600,000. Interest on the new mortgage is 7.79%. Payments of approximately $46,000 are due on the first day of each month until the loan matures December 1, 2019. Loan costs of approximately $86,000 were capitalized as of December 31, 1999. Additional loan costs of approximately $35,000 were capitalized during the nine months ended September 30, 2000. The loan costs are being amortized over the life of the mortgage and the amortization expense is included in interest expense. The Partnership's current assets are thought to be sufficient for any near-term needs (exclusive of capital improvements) of the Partnership. The mortgage indebtedness of approximately $5,507,000 is amortized over 240 months and matures December 1, 2019. The General Partner will attempt to refinance such indebtedness and/or sell the property prior to such maturity date. If the property cannot be refinanced or sold for a sufficient amount, the Partnership will risk losing such property through foreclosure. A distribution of approximately $2,297,000 (approximately $2,250,000 to the limited partners or $12.41 per limited partnership unit) was accrued during December 1999 and paid in January 2000. This distribution consisted of cash from operations of approximately $1,175,000 (approximately $1,128,000 to the limited partners or $6.22 per limited partnership unit) and refinancing proceeds of approximately $1,122,000 to the limited partners ($6.19 per limited partnership unit). No distributions were made during the nine months ended September 30, 1999. Future cash distributions will depend on the levels of net cash generated from operations, the availability of cash reserves and the timing of the debt maturity, refinancing and/or property sale. The Registrant's distribution policy is reviewed on an annual basis. There can be no assurance, however, that the Registrant will generate sufficient funds from operations after required capital improvements to permit further distributions to its partners during the remainder of 2000 or subsequent periods. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In March 1998, several putative unit holders of limited partnership units of the Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia Financial Group, Inc., et al. in the Superior Court of the State of California for the County of San Mateo. The plaintiffs named as defendants, among others, the Partnership, its General Partner and several of their affiliated partnerships and corporate entities. The action purports to assert claims on behalf of a class of limited partners and derivatively on behalf of a number of limited partnerships (including the Partnership) which are named as nominal defendants, challenging the acquisition of interests in certain general partner entities by Insignia Financial Group, Inc. ("Insignia") and entities which were, at one time, affiliates of Insignia; past tender offers by the Insignia affiliates to acquire limited partnership units; the management of partnerships by the Insignia affiliates; and the Insignia Merger. The plaintiffs seek monetary damages and equitable relief, including judicial dissolution of the Partnership. On June 25, 1998, the General Partner filed a motion seeking dismissal of the action. In lieu of responding to the motion, the plaintiffs have filed an amended complaint. The General Partner filed demurrers to the amended complaint which were heard February 1999. Pending the ruling on such demurrers, settlement negotiations commenced. On November 2, 1999, the parties executed and filed a Stipulation of Settlement, settling claims, subject to final court approval, on behalf of the Partnership and all limited partners who owned units as of November 3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999 from the Court, at which time the Court set a final approval hearing for December 10, 1999. Prior to the December 10, 1999 hearing, the Court received various objections to the settlement, including a challenge to the Court's preliminary approval based upon the alleged lack of authority of prior lead counsel to enter the settlement. On December 14, 1999, the General Partner and its affiliates terminated the proposed settlement. In February 2000, counsel for some of the named plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who negotiated the settlement. On June 27, 2000, the Court entered an order disqualifying them from the case. The Court is considering applications for lead counsel and has currently scheduled a hearing on the matter for November 20, 2000. The General Partner does not anticipate that costs associated with this case will be material to the Partnership's overall operations. Item 4. Submission of Matters to a Vote of Security Holders On September 16, 2000, the Partnership sought the vote of limited partners to amend the Partnership Agreement to eliminate the requirement for the Partnership to maintain reserves equal to at least 5% of the limited partners' capital contributions less distributions to limited partners and instead permit the General Partner to determine reasonable reserve requirements of the Partnership. The vote was sought pursuant to a Consent Solicitation that expired on October 16, 2000 at which time the amendment was approved by the requisite percent of limited partnership interests. Upon expiration of the consent period, a total number of 110,551 units had voted of which 102,214 units had voted in favor of the amendment, 6,832 voted against the amendment and 1,505 units abstained. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a) Exhibits: Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report. b) Reports on Form 8-K: None filed during the quarter ended September 30, 2000. SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CONSOLIDATED CAPITAL PROPERTIES VI By: CONCAP EQUITIES, INC. General Partner By: /s/Patrick J. Foye Patrick J. Foye Executive Vice President By: /s/Martha L. Long Martha L. Long Senior Vice President and Controller Date: