-----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, Q3ENuhp5WMnrjaCHC/p43ZTLcnAudj307rwGwImkskK5xrOrNfzJRhFFIL9EONe8 Qy+x6VK8vKtGq3PqPpFKkQ== 0000711642-97-000005.txt : 19970325 0000711642-97-000005.hdr.sgml : 19970325 ACCESSION NUMBER: 0000711642-97-000005 CONFORMED SUBMISSION TYPE: 10KSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970324 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: JOHNSTOWN CONSOLIDATED INCOME PARTNERS CENTRAL INDEX KEY: 0000787621 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 943004963 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10KSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-16010 FILM NUMBER: 97561389 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 8032391513 MAIL ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 FORMER COMPANY: FORMER CONFORMED NAME: CONSOLIDATED CAPITAL INCOME GROWTH PARTNERS DATE OF NAME CHANGE: 19860401 10KSB 1 FORM 10-KSB--ANNUAL OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(D) (As last amended by 34-31905, eff. 4/26/93) FORM 10-KSB [X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [No Fee Required] For the fiscal year ended December 31, 1996 or [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [No Fee Required] For the transition period.........to......... Commission file number 0-16010 JOHNSTOWN/CONSOLIDATED INCOME PARTNERS (Name of small business issuer in its charter) California 94-3004963 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) One Insignia Financial Plaza, P.O. Box 1089 Greenville, South Carolina 29602 (Address of principal executive offices) (Zip Code) Issuer's telephone number (864) 239-1000 Securities registered under Section 12(b) of the Exchange Act: None Securities registered under Section 12(g) of the Exchange Act: Units of Depositary Receipt (Title of class) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 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 in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of 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 issuer's revenues for its most recent fiscal year: $2,260,000 State the aggregate market value of the voting partnership interests held by non-affiliates computed by reference to the price at which the partnership interests were sold, or the average bid and asked prices of such partnership interests, as of December 31, 1996: Market value information for the Registrant's partnership interests is not available. Should a trading market develop for these interests, it is management's belief that such trading would not exceed $25,000,000. PART I ITEM 1.BUSINESS Johnstown/Consolidated Income Partners (the "Partnership" or "Registrant") was organized on January 9, 1986, as a limited partnership under the California Revised Limited Partnership Act. On June 20, 1986, the Partnership registered with the Securities and Exchange Commission ("SEC") under the Securities Act of 1933 (File No. 33-2637) and commenced a public offering for sale of $150 million of Units. The Units represent economic rights attributable to the limited partnership interests in the Partnership and entitle the holders thereof (hereinafter referred to as "Unitholders") to the economic benefits attributable to equity interests in the Partnership and to participate in certain allocations and distributions of the Partnership. The limited partner of the Partnership is Johnstown/Consolidated Depositary Corporation (the "Corporate Limited Partner"), an affiliate of the General Partner (as hereinafter defined). The Corporate Limited Partner serves as depositary for the Units pursuant to a Depositary Agreement entered into with the Partnership. The Partnership subsequently filed a Form 8-A Registration Statement with the SEC and registered the Units under the Securities Exchange Act of 1934 (File No. 0-16010). The sale of Units closed on June 19, 1987, with 129,266 Units sold at $250 each, for gross proceeds of approximately $32.3 million to the Partnership. The Partnership has retired a total of 456 Units which were returned to the Partnership by Unitholders. The Partnership gave no consideration for the Units retired. The Partnership may reacquire or retire any Units, at its absolute discretion, but is under no obligation to do so. By the end of fiscal year 1988, approximately 79% of the proceeds raised had been invested in four (4) properties, five (5) mortgage loans, and approximately $1.6 million in guaranteed mortgage-backed securities ("MBS"). Of the remaining 21%, 11.8% was required for organizational and offering expenses and sales commissions and 9.2% was retained in Partnership reserves for working capital as required by the Partnership Agreement. The General Partner of the Partnership is ConCap Equities, Inc., a Delaware corporation (the "General Partner" or "CEI"). The principal place of business for the Partnership and the General Partner is One Insignia Financial Plaza, Greenville, South Carolina 29602. The General Partner and the Corporate Limited Partner shall together be called the "Partners." The Partnership's primary business and only industry segment is real estate related operations. The Partnership was formed for the benefit of its Unitholders: (i) to acquire, own and operate existing income-producing properties and newly constructed properties with income-producing capabilities including office buildings, industrial properties, shopping centers, mobile home parks and residential properties; (ii) to invest in mortgage loans originated or purchased by the Partnership; and (iii) to invest in MBS's. As of December 31, 1996, the Partnership owned three (3) properties and a one-third (1/3) undivided interest in another property. In years previous to 1996, the Partnership liquidated its investments in MBSs, sold two (2) properties (accepting a note on one of the sales), received payment on two (2) of the mortgage loans, completed a judicial foreclosure on three (3) properties which secured three (3) mortgage loans, and disposed of one (1) property which was foreclosed upon by the lender. As of December 31, 1996, the Partnership's working capital reserves are in excess of the 5% of Net Invested Capital (as defined in the Partnership Agreement) as required by the Partnership Agreement. See "Item 6 - Management's Discussion and Analysis" for discussion of Partnership liquidity and capital resources. The real estate business is highly competitive. The Registrant's real property investments are subject to competition from similar types of properties in the markets in which they are located and the Partnership is not a significant factor in its industry. In addition, various limited partnerships have been formed by related parties to engage in business which may be competitive with the Registrant. The Registrant has no employees. Management and administrative services are performed by affiliates of Insignia Financial Group, Inc. ("Insignia"), an affiliate of the General Partner. The property manager is responsible for the day-to-day operations of each property. The General Partner has also selected affiliates of Insignia to provide real estate advisory and asset management services to the Partnership. As advisor, such affiliates provide all partnership accounting and administrative services, investment management, and supervisory services over property management and leasing. For a further discussion of property and partnership management, see "Item 12". Upon the Partnership's formation in 1986, Consolidated Capital Equities Corporation ("CCEC") was the sole General Partner of the Partnership, and Johnstown/Consolidated Depositary Corporation, a wholly-owned subsidiary of CCEC, was the sole limited partner. In 1988, Southmark Corporation ("Southmark") gained control of CCEC. In December 1988, CCEC filed for reorganization under Chapter 11 of the United States Bankruptcy Code. As part of its reorganization plan, CEI acquired CCEC's general partner interests in the Partnership and in 15 other affiliated public limited partnerships (the "Affiliated Partnerships") and replaced CCEC as managing general partner in all 16 partnerships. The selection of CEI as the sole managing general partner was approved by a majority of the Unitholders in the Partnership and the limited partners in each of the Affiliated Partnerships pursuant to a solicitation of the Unitholders dated August 10, 1990. As part of this solicitation, the Unitholders also approved an amendment to the Partnership Agreement to limit changes of control of the Partnership. All of CEI's outstanding stock is owned by GII Realty, Inc. In December 1994, the parent of GII Realty, Inc., entered into a transaction (the "Insignia Transaction") in which an affiliate of Insignia acquired an option (exercisable in whole or in part from time to time) to purchase all of the stock of GII Realty, Inc. and, pursuant to a partial exercise of such option, acquired 50.5% of that stock. As a part of the Insignia Transaction, the Insignia affiliate also acquired all of the outstanding stock of Partnership Services, Inc., an asset management entity and Insignia acquired all of the outstanding stock of Coventry Properties, Inc., a property management entity. In addition, confidentiality, non-competition, and standstill arrangements were entered into between certain of the parties. Those arrangements, among other things, prohibit GII Realty's former sole shareholder from purchasing Partnership Units for a period of three years. On October 24, 1995, the Insignia affiliate exercised the remaining portion of its option to purchase all of the remaining outstanding capital stock of GII Realty, Inc. ITEM 2. DESCRIPTION OF PROPERTY The Partnership originally acquired four (4) properties and funded five (5) loans. At December 31, 1996, the Partnership owns three (3) properties and a one-third (1/3) undivided interest in another property. The following table sets forth the properties held by the Partnership. Additional information about the properties is found in "Item 7 - Financial Statements", "Note K - Investment Properties and Accumulated Depreciation."
Date of Property Purchase Type of Ownership Use Cedar Brooke 02/27/87 Fee ownership subject Apartment Independence, Missouri to first mortgage 158 units Florida #6 Mini-Warehouse 10/15/90 Fee ownership Storage Cente Lauderhill, Florida 61,121 sq.ft. Florida #11 Mini-Warehouse 10/15/90 Fee ownership Storage Cente Davie, Florida 64,240 sq.ft. Phoenix Business Campus 08/26/86 Fee ownership Office Buildi Atlanta, Georgia 79,196 sq.ft.
SCHEDULE OF PROPERTIES: (dollar amounts in thousands)
Gross Carrying Accumulated Federal Property Value Depreciation Rate Method Tax Basis Cedar Brooke $ 4,044 $2,528 5-19 years S/L $ 2,630 Florida #11 Mini- Warehouse 2,749 563 5-20 years S/L 2,409 Phoenix Business Campus 5,890 2,600 5-28 years S/L 2,783 Totals $12,683 $5,691 $ 7,822 Also, the Partnership's one-third interest in the Florida #6 Mini-Warehouse has been classified as investment property held for sale. At December 31, 1996, the Partnership's net carrying value of the property is approximately $850,000 and a Federal tax basis of approximately $946,000. Johnstown/Consolidated Income Partners/2, an affiliated Partnership, owns the remaining two-thirds interest in the property. See "Note A" of the Financial Statements included in "Item 7" for a description of the Partnership's depreciation policy. SCHEDULE OF MORTGAGES: (dollar amounts in thousands) Principal Principal Balance At Balance December 31, Interest Maturity Due At Property 1996 Rate Date Maturity Cedar Brooke $ 2,325 7.33% 11/03 $ 2,325 1st mortgage SCHEDULE OF RENTAL RATES AND OCCUPANCY: Average Annual Average Rental Rates Occupancy Property 1996 1995 1996 1995 Cedar Brooke $ 5,461/per unit $ 5,231/per unit 98% 99% Florida #6 Mini-Warehouse 10.88/per sq. ft. 10.44/per sq. ft. 91% 90% Florida #11 Mini-Warehouse 10.99/per sq. ft. 10.27/per sq. ft. 96% 96% Phoenix Business Campus 7.52/per sq. ft. 8.76/per sq. ft. 62% 58% The increase in average rental rates at Cedar Brooke and the Florida #6 and #11 Mini-Warehouses is due to higher rental rates being charged at the properties. The decrease in the average rental rate at Phoenix Business Center is due to the lower rental income in 1996 resulting from the continued negative impact on vacancy created by the move out of a large tenant during the first quarter of 1995. The increase in average occupancy at the Phoenix Business Campus is due to a new tenant who moved in in the fourth quarter, occupying 14% of the total square footage. As noted under "Item 1. Description of Business", the real estate industry is highly competitive. All of the properties of the Partnership are subject to competition from other similar properties in the area. The General Partner believes that all of the properties are adequately insured. With the exception of the Phoenix Business Campus, the properties' lease terms are for one year or less and no tenant leases 10% or more of the available rental space. The following is a schedule of lease expirations for the years 1997-2006 (dollar amounts in thousands): Number of % of Gross Expirations Square Feet Annual Rent Annual Rent Phoenix Business Campus 1997 1 3,990 $ 28 6.94% 1998 2 25,776 177 43.28% 1999 1 5,170 41 10.14% 2000 2 6,858 66 16.08% 2001 1 11,092 96 23.56% 2002-2006 0 -- -- -- The following schedule reflects information on tenants leasing 10% or more of the leasable square footage for each property: Square Nature of Footage Annual Rent/ Lease Business Leased Square Foot Expiration Phoenix Business Campus Computer software 17,342 $6.50 1-31-98 Airline services 8,434 $7.57 10-31-98 Mortgage lender 11,092 $8.67 9-30-01 SCHEDULE OF REAL ESTATE TAXES AND RATES: Real estate taxes and rates in 1996 for each property were (dollar amounts in thousands): 1996 1996 Billing Rate Cedar Brooke $43 6.1% Florida #6 Mini-Warehouse (a) 26 2.4% Florida #11 Mini-Warehouse 65 2.6% Phoenix Business Campus 28 3.8% (a) Represents the Partnership's one-third share of real estate taxes. ITEM 3. LEGAL PROCEEDINGS The Partnership is unaware of any pending or outstanding litigation that is not of a routine nature. The General Partner of the Partnership believes that all such pending or outstanding litigation will be resolved without a material adverse effect upon the business, financial condition, or operations of the Partnership. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS During the fourth quarter of the year ended December 31, 1996, no matters were submitted to a vote of the Unitholders, through the solicitation of proxies or otherwise. PART II ITEM 5. MARKET FOR THE REGISTRANT'S UNITS OF DEPOSITARY RECEIPT AND RELATED SECURITY HOLDER MATTERS (A) No established public trading market for the Units exists nor is one expected to develop. (B) Title of Class: Number of Unitholders of Record: Units of Depositary Receipt 2,660 as of December 31, 1996 (C) In March 1996, the General Partner paid distributions attributable to cash flow from operations totalling approximately $490,000 or $3.81 per Unit to the Unitholders, and a corresponding $5,000 General Partner distribution. In September 1996, the General Partner paid distributions attributable to cash flow from operations totalling approximately $500,000 or $3.88 per Unit to the Unitholders, and a corresponding $5,000 distribution to the General Partner. Cumulative distributions to Unitholders since the inception of the Partnership totaled approximately $12.2 million at December 31, 1996. In March 1995, the General Partner paid distributions attributable to cash flow from operations totalling approximately $495,000 or $3.84 per Unit to the Unitholders, and a corresponding $5,000 General Partner distribution. In September 1995, the General Partner paid distribution attributable to cash flow from operations totalling approximately $495,000 or $3.84 per Unit to the unitholders along with a corresponding General Partner distribution of approximately $5,000. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION Results of Operations The Partnership realized a net loss of approximately $109,000 for the year ended December 31, 1996, compared to net income of approximately $350,000 for the year ended December 31, 1995. The decrease in net income is primarily due to a $123,000 decrease in other income, increased maintenance expense and the $231,000 loss realized on the refinancing of the debt secured by the Cedar Brooke Apartments in 1996, partially offset by decreased administrative expenses. The decrease in other income resulted from the Partnership receiving no dividends on its investment in Southmark Preferred Stock during 1996. Maintenance expense increased due to expenditures for exterior painting at the Florida #11 Mini-Warehouse and exterior building improvements made at the Cedar Brooke Apartments in efforts to increase the curb appeal of the Partnership's properties. The maintenance expense increase was partially offset by the decrease in general and administrative expenses resulting from the elimination of expense reimbursements related to efforts of the Dallas partnership administration staff during the management transition in 1995. In November of 1996, the Partnership refinanced the mortgage note of approximately $2,061,000, secured by the Cedar Brooke Apartments. Accordingly, this debt is no longer regulated by the U.S. Department of Housing and Urban Development. The new mortgage indebtedness of $2,325,000 requires monthly interest only payments at a stated rate of 7.33% with a balloon payment due at maturity. A loss on refinancing of approximately $231,000 was realized in 1996. This loss resulted from the write-off of unamortized mortgage discounts and loan costs. Included in maintenance expenses is approximately $69,000 of major repairs and maintenance comprised primarily of exterior painting and exterior building improvements for the year ended December 31, 1996. As part of the ongoing business plan of the Partnership, the General Partner monitors the rental market environment of each of its investment properties 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 December 31, 1996, the Partnership held unrestricted cash and cash equivalents of approximately $1,583,000 compared to approximately $1,967,000 at December 31, 1995. Net cash provided by operating activities decreased slightly due primarily to reduced rental and other income, an increase in interest payments and higher maintenance expenses. Net cash provided by investing activities decreased as a result of the Partnership investing primarily in shorter term cash equivalents during 1996, rather than longer term securities and due to the establishment of a restricted capital escrow in conjunction with the refinancing of the mortgage indebtedness secured by the Cedar Brooke Apartments (see "Note E" on the Notes to the Financial Statements in "Item 7"). Net cash used in financing activities decreased as a result of the refinancing of Cedar Brooke in 1996. The Partnership is required by the Partnership Agreement 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, including cash and cash equivalents, tenant security deposits and investments totalling approximately $2,083,000 at December 31, 1996, exceeded the Partnership's reserve requirement of approximately $1,385,000. 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 assets and meet other operating needs of the Partnership. Such assets are currently thought to be sufficient for any near-term needs of the Partnership. The mortgage indebtedness of $2,325,000, matures in 2003, at which time the debt will either be refinanced or the property sold. Future cash distributions will depend on the levels of net cash generated from operations, capital expenditure requirements, property sales and the availability of cash reserves. As part of the Partnership's ongoing attempt to maximize return to the Unitholders, the Partnership is under negotiations to sell its one-third interest in the Florida #6 Mini-Warehouse. Currently, the property disposition is not considered imminent. Cash distributions of approximately $1 million were paid during each of the years ended December 31, 1996 and 1995. ITEM 7. FINANCIAL STATEMENTS JONHSTOWN/CONSOLIDATED INCOME PARTNERS LIST OF FINANCIAL STATEMENTS Report of Independent Auditors Balance Sheet B December 31, 1996 Statements of Operations - Years ended December 31, 1996 and 1995 Statements of Changes in Partners' Capital (Deficit) - Years ended December 31, 1996 and 1995 Statements of Cash Flows - Years ended December 31, 1996 and 1995 Notes to Financial Statements Report of Ernst & Young LLP, Independent Auditors The Partners Johnstown/Consolidated Income Partners We have audited the accompanying balance sheet of Johnstown/Consolidated Income Partners as of December 31, 1996, and the related statements of operations, changes in partners' capital (deficit) and cash flows for each of the two years in the period ended December 31, 1996. These financial statements are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the Partnership's 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 financial statements referred to above present fairly, in all material respects, the financial position of Johnstown/Consolidated Income Partners as of December 31, 1996, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 1996, in conformity with generally accepted accounting principles. /s/ ERNST & YOUNG LLP Greenville, South Carolina January 30, 1997 JOHNSTOWN/CONSOLIDATED INCOME PARTNERS BALANCE SHEET (in thousands, except unit data) December 31, 1996
Assets Cash and cash equivalents: Unrestricted $ 1,583 Restricted - tenant security deposits 53 Investments 447 Accounts receivable, net of allowance 28 Escrows for taxes and insurance 308 Restricted escrows 67 Other assets 246 Investment property held for sale 850 Investment properties: Land $ 1,571 Buildings and related personal property 11,112 12,683 Less accumulated depreciation (5,691) 6,992 $10,574 Liabilities and Partners' Capital (Deficit) Accounts payable $ 104 Tenant security deposits 61 Accrued taxes 47 Other liabilities 82 Mortgage notes payable 2,325 Partners' Capital (Deficit) General partner $ (166) Corporate limited partner on behalf of the Unitholders - (128,810 Units 8,121 7,955 issued and outstanding) $10,574 See Accompanying Notes to Financial Statements
JOHNSTOWN/CONSOLIDATED INCOME PARTNERS STATEMENTS OF OPERATIONS (in thousands, except unit data) Years Ended December 31, 1996 1995 Revenues: Rental income $2,093 $2,172 Other income 167 290 Total revenues 2,260 2,462 Expenses: Operating 725 722 General and administrative 293 335 Maintenance 252 196 Depreciation 514 519 Interest 191 180 Property taxes 163 160 Total expenses 2,138 2,112 Income before extraordinary item 122 350 Extraordinary loss on early extinguishments of debt (231) -- Net (loss) income $ (109) $ 350 Net (loss) income allocated to general partner (1%) $ (1) $ 3 Net (loss) income allocated to limited partners (99%) (108) 347 $ (109) $ 350 Per Unit of Depositary Receipt: Income before extraordinary item .95 2.69 Extraordinary loss on early extinguishments of debt (1.79) -- Net (loss) income per Unit of Depositary Receipt: $ (.84) $ 2.69 See Accompanying Notes to Financial Statements JOHNSTOWN/CONSOLIDATED INCOME PARTNERS STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT) YEARS ENDED DECEMBER 31, 1996 AND 1995 (in thousands, except unit data) Unitholders Units of Units of Depositary General Depositary Receipt Partner Receipt Total Original capital contributions 129,266 $ 1 $32,317 $32,318 Partners' capital (deficit) at December 31, 1994 128,810 (148) 9,862 9,714 Distributions paid -- (10) (990) (1,000) Net income for the year ended December 31, 1995 -- 3 347 350 Partners' capital (deficit) at December 31, 1995 128,810 (155) 9,219 9,064 Distributions paid -- (10) (990) (1,000) Net loss for the year ended December 31, 1996 -- (1) (108) (109) Partners' capital (deficit) at December 31, 1996 128,810 $ (166) $ 8,121 $ 7,955 See Accompanying Notes to Financial Statements JOHNSTOWN/CONSOLIDATED INCOME PARTNERS STATEMENTS OF CASH FLOWS (in thousands) Years Ended December 31, 1996 1995 Cash flows from operating activities: Net (loss) income $ (109) $ 350 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation 514 519 Amortization of lease commissions, loan costs and mortgage discounts 43 39 Loss on refinancing 231 -- Bad debt expense 96 20 Change in accounts: Restricted cash (1) (25) Accounts receivable (91) (21) Escrows for taxes and insurance (29) (3) Other assets 43 (41) Accounts payable 88 (13) Tenant security deposit liabilities 9 8 Accrued taxes 47 -- Other liabilities (8) 50 Net cash provided by operating activities 833 883 Cash flows from investing activities: Property improvements and replacements (152) (112) Purchase of investments -- (1,009) Proceeds from sale of investments -- 2,713 Deposits to restricted escrows (327) (21) Receipts from restricted escrows 138 -- Net cash (used in) provided by investing activities (341) 1,571 Cash flows from financing activities: Payments on mortgage notes payable (50) (51) Repayment of mortgage notes payable (2,061) -- Proceeds from long-term borrowings 2,325 -- Loan costs paid (90) -- Distributions to partners (1,000) (1,000) Net cash used in financing activities (876) (1,051) Net (decrease) increase in cash and cash equivalents (384) 1,403 Cash and cash equivalents at beginning of period 1,967 564 Cash and cash equivalents at end of period $ 1,583 $ 1,967 Supplemental disclosure of cash flow information: Cash paid for interest $ 164 $ 147 See Accompanying Notes to Financial Statements JOHNSTOWN/CONSOLIDATED INCOME PARTNERS NOTES TO FINANCIAL STATEMENTS December 31, 1996 NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Johnstown/Consolidated Income Partners (the "Partnership" or "Registrant"), a California limited partnership, was formed on January 9, 1986, to acquire and operate commercial and residential properties and to invest in mortgage loans and mortgage-backed securities. Consolidated Capital Equities Corporation ("CCEC"), the general partner, and Johnstown/Consolidated Depositary Corporation (the "Corporate Limited Partner"), which serves as depositary of certain Units of Depositary Receipt ("Units"), contributed $1,000 and $100,000, respectively. The Units represent economic rights attributable to the limited partnership interests in the Partnership and entitle the holders thereof ("Unitholders") to the economic benefits attributable to equity interests in the Partnership and to participate in certain allocations and distributions of the Partnership. For this reason, partners' capital (deficit) is herein represented as an interest of the Unitholders. As of December 31, 1996, the Partnership owned one residential and two commercial properties and a one-third undivided interest in another commercial property, all of which are located near major urban areas in the United States. At the time of the Partnership's formation, CCEC was the sole general partner of the Partnership, and the Corporate Limited Partner was a wholly-owned subsidiary of CCEC. In 1988, Southmark Corporation ("Southmark") gained control of CCEC. In December 1988, CCEC filed for reorganization under Chapter 11 of the United States Bankruptcy Code. As part of its reorganization plan, ConCap Equities, Inc. ("General Partners" or "CEI") acquired CCEC's general partner interests in the Partnership and in 15 other affiliated public limited partnerships (the "Affiliated Partnerships") and acquired the stock of the corporate limited partner, replacing CCEC as managing general partner in all 16 partnerships. All of CEI's outstanding stock is owned by GII Realty, Inc., an affiliate of Insignia Financial Group, Inc. ("Insignia"). All of CEI's outstanding stock is owned by GII Realty, Inc. In December 1994, the parent of GII Realty, Inc., entered into a transaction (the "Insignia Transaction") in which, an affiliate of Insignia, acquired an option (exercisable in whole or in part from time to time) to purchase all of the stock of GII Realty, Inc. and, pursuant to a partial exercise of such option, acquired 50.5% of that stock. As a part of the Insignia Transaction, the Insignia affiliate also acquired all of the outstanding stock of Partnership Services, Inc., an asset management entity and Insignia acquired all of the outstanding stock of Coventry Properties, Inc., a property management entity. In addition, confidentiality, non-competition, and standstill arrangements were entered into between certain of the parties. Those arrangements, among other things, prohibit GII Realty's former sole shareholder from purchasing Partnership Units for a period of three years. On October 24, 1995, the Insignia affiliate exercised the remaining portion of its option to purchase all of the remaining outstanding capital stock of GII Realty, Inc. The principal place of business for the Partnership and for the General Partner is One Insignia Financial Plaza, Greenville, South Carolina, 29602. Cash and cash equivalents: Unrestricted - Unrestricted cash includes cash on hand and in banks, demand deposits, money market funds and certificates of deposit with original maturities of 90 days or less. At certain times the amount of cash deposited at a bank may exceed the limit on insured deposits. Restricted cash - tenant security deposits - The Partnership requires security deposits from new lessees for the duration of the lease with such deposits being considered restricted cash. Deposits are refunded when the tenant vacates, provided the tenant has not damaged its space and is current on its rental payments. Depreciation Buildings and improvements are depreciated using the straight-line method over the estimated useful lives of the assets, ranging from 5 to 28 years. Effective December 31, 1996, the Florida #6 Mini-Warehouse was classified as held for sale and no additional depreciation expense will be recorded during the period the assets are held for sale. Reclassifications Certain reclassifications have been made to the 1995 information to conform to the 1996 presentation. Investments The Partnership accounts for its investments in accordance with "Statement of Financial Accounting Standards No. 115, Accounting for Certain Investments in Debt and Equity Securities." Investments, consisting primarily of U.S. Treasury notes with original maturities more than ninety days, are considered to be held- to-maturity securities. As the Investments' fair value approximate their cost, any unrealized gains or losses are immaterial and therefore have not been recorded in the accompanying financial statements. The cost of Investments sold is determined using the specific identification method. The Investments mature as follows (dollar amounts in thousands): Description Cost Maturity U.S. Treasury Note $ 447 October 1997 Fair Value In 1995, the Partnership implemented "Statement of Financial Accounting Standards No. 107, Disclosure about Fair Value of Financial Instruments," which requires disclosure of fair value information about financial instruments for which it is practicable to estimate that value. The carrying amount of the Partnerships' cash and cash equivalents approximates fair value due to short- term maturities. The Partnership estimates the fair value of its fixed rate mortgages by discounted cash flow analysis, based on estimated borrowing rates currently available to the Partnership. Investment Properties Prior to 1995, investment properties were carried at the lower of cost or estimated fair value, which was determined using the higher of the property's non-recourse debt amount, when applicable, or the net operating income of the investment property capitalized at a rate deemed reasonable for the type of property. During 1995, the Partnership adopted "FASB Statement No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying amount. The impairment loss is measured by comparing the fair value of the asset to its carrying amount. The effect of adoption was not material. Investment Property Held for Sale In accordance with "FASB Statement No. 121" at December 31, 1996, the Partnership has classified the Florida #6 Mini-Warehouses as an investment property held for sale. The property has been recorded at the lower of its carrying amount or its fair value less costs to sell. For the year ended December 31, 1996 and 1995, the property realized total net income of approximately $91,000 and $76,000, respectively. Rental Income The Partnership leases its residential property and its commercial mini- warehouses under short-term operating leases. Lease terms are generally one year or less in duration. The Partnership expects that in the normal course of business these leases will be renewed or replaced by other leases. Commercial office property leases vary from one to five years. Rental income is recognized on a straight-line basis over the life of the applicable leases. Deferred Loan Fees Deferred loan fees are amortized using the straight-line method over the lives of the related mortgage notes. Unamortized deferred fees are included in other assets. Lease Commissions Lease commissions are capitalized and amortized using the straight-line method over the life of the applicable lease. Unamortized lease commissions are included in other assets. Allocation of Net Income and Net Loss The Partnership Agreement provides for net income and net losses for both financial and tax reporting purposes to be allocated 99% to the Unitholders and 1% to the General Partner. Advertising Costs The Partnership expenses the cost of advertising as incurred. Advertising expense, which is included in operating expenses, was approximately $39,000 for the years ended December 31, 1996 and 1995. Units of Depositary Receipts Johnstown/Consolidated Depositary Corporation (the "Corporate Limited Partner"), an affiliate of the General Partner, serves as a depositary of certain Units of Depositary Receipt ("Units"). The Units represent economic rights attributable to the limited partnership interests in the Partnership and entitle the holders thereof ("Unitholders") to certain economic benefits, allocations and distributions of the Partnership. For this reason, Partners' capital (deficit) is herein represented as an interest of the Unitholder. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. NOTE B - RELATED PARTY TRANSACTIONS The Partnership has no employees and is dependent on the General Partner and affiliates of Insignia for the management and administration of all of the Partnership activities, as provided for in the Partnership agreement. The Partnership Agreement provides that the Partnership shall pay in monthly installments to the General Partner, or an affiliate, a yearly asset management fee equal to: (i) 3/8 of 1% of the original principal balance of mortgage loans outstanding at the end of the month preceding the installment payment; (ii) 1/8 of 1% of the market value of guaranteed mortgage-backed securities as of the end of the Partnership quarter immediately preceding the installment payment; and (iii) 5/8 of 1% of the purchase price of the properties plus improvements for managing the Partnership's assets. In the event the property was not owned at the beginning or end of the year, such fee shall be pro-rated for the short-year period of ownership. Under this provision, fees of approximately $98,000 were paid to the General Partner and affiliates for each of the years ended December 31, 1996 and 1995, respectively, and are included in general and administrative expenses. The Partnership has paid property management fees based upon collected gross rental revenues for property management services in each of the years ended December 31, 1996 and 1995. Property management fees of approximately $95,000 and $115,000 were paid to an affiliate of the General Partner for each of the years ended December 31, 1996 and 1995, respectively. These fees are included in operating expenses. The Partnership Agreement also provides for reimbursement to the General Partner and its affiliates for costs incurred in connection with the administration of Partnership activities. Reimbursements for services of affiliates of approximately $135,000 and $136,000 were paid to the General Partner and affiliates for each of the years ended December 31, 1996 and 1995, respectively. Reimbursements of costs are classified as general and administrative expenses. Included in these amounts are approximately $6,000 and $4,000 of leasing commissions for 1996 and 1995, respectively, that were paid to an affiliate of Insignia. Leasing commissions are capitalized and included in other assets. In addition, during 1996, the Partnership paid approximately $12,000 to affiliates of the General Partner for reimbursement of services related to the Cedar Brooke loan refinancing (see "Note E"). These charges have been capitalized as loan costs and will be amortized over the life of the loan. In July 1995, the Partnership began insuring its properties under a master policy through an agency and insurer unaffiliated with the General Partner. An affiliate of the General Partner acquired, in the acquisition of a business, certain financial obligations from an insurance agency which was later acquired by the agent who placed the current year's master policy. The current agent assumed the financial obligations to the affiliate of the General Partner who receives payment on these obligations from the agent. The amount of the Partnership's insurance premiums accruing to the benefit of the affiliate of the General Partner by virtue of the agent's obligations is not significant. In December 1995, an affiliate of the General Partner, Liquidity Assistance, LLC, purchased 10,062 units from an unaffiliated Limited Partner at a cash price of $61.04 per unit, or approximately $614,000. NOTE C - COMMITMENT The Partnership is required by the Partnership Agreement to maintain working capital 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 revenues shall be allocated to such reserves to the extent necessary to maintain the foregoing level. Reserves, including cash and cash equivalents, tenant security deposits and investments totalling approximately $2,083,000 at December 31, 1996, exceeded the Partnership's reserve requirement of approximately $1,385,000. NOTE D - DISTRIBUTIONS In March 1996, the General Partner paid distributions attributable to cash flow from operations of approximately $490,000 or $3.81 per Unit to the Unitholders along with a corresponding General Partner distribution of $5,000. In September 1996, the General Partner paid distributions of approximately $500,000 or $3.88 per Unit to the Unitholders, along with a corresponding General Partner distribution of approximately $5,000. In March of 1995, the General Partner paid distributions attributable to cash flow from operations totalling approximately $495,000 or $3.84 per Unit to the Unitholders along with a corresponding General Partner distribution of approximately $5,000. In September 1995, the General Partner paid distributions attributable to cash flow from operations totalling approximately $495,000 or $3.84 per Unit to the Unitholders along with a corresponding General Partner distribution of approximately $5,000. NOTE E - REFINANCING In November of 1996 the Partnership refinanced the mortgage note of approximately $2,061,000, secured by the Cedar Brooke Apartments. Accordingly, this debt is no longer regulated by the U.S. Department of Housing and Urban Development. Under the terms of the financing agreement, the new mortgage indebtedness of $2,325,000 requires monthly interest only payments at a stated interest rate of 7.33% with a balloon payment due November 1, 2003. A loss on refinancing of approximately $231,000 resulting from the write-off of unamortized mortgage discounts and loan costs was realized in 1996. Through the refinancing, a capital improvement reserve of approximately $303,000 was established and approximately $90,000 of loan costs were incurred. These loan costs will be amortized over the life of the loan. NOTE F - MORTGAGE NOTES PAYABLE The principal terms of mortgage notes payable is as follows (dollar amounts in thousands): Principal Monthly Principal Balance At Payment Stated Balance December 31, Including Interest Maturity Due At Property 1996 Interest Rate Date Maturity Cedar Brooke 1st mortgage $2,325 $14(a) 7.33% 11/03 $2,325 (a) Interest-only payment. NOTE F - MORTGAGE NOTES PAYABLE (CONTINUED) The estimated fair value of the Partnerships' debt approximates its carrying value of $2,325,000. This value represents a general approximation of possible value and is not necessarily indicative of the amounts the Partnership might pay in actual market transactions. There are no scheduled maturities of principal during the next five years. A balloon payment of $2,325,000 representing principal is due in 2003. NOTE G - OPERATING LEASES Lessor Tenants of Phoenix Business Campus are responsible for their own utilities and maintenance of their space, and payment of their proportionate share of common area maintenance, utilities, insurance and real estate taxes. A portion of the real estate taxes, insurance, and common area maintenance expenses are paid directly by the Partnership. The Partnership is then reimbursed by the tenants for their proportionate share. The future minimum rental payments at the Partnership's commercial property to be received under operating leases that have initial or remaining noncancellable lease terms in excess of one year as of December 31, 1996, are as follows (in thousands): Years Ending December 31, 1997 $ 433 1998 275 1999 179 2000 141 2001 - Thereafter 78 $ 1,106 NOTE K - INVESTMENT PROPERTIES AND ACCUMULATED DEPRECIATION Initial Cost To Partnership Cost Buildings Capitalized and Related (Written off) Personal Subsequent to Description Encumbrances Land Property Acquisition (in thousands) Cedar Brooke $2,325 $ 275 $ 4,040 $ (271) Florida #11 Mini-Warehouse -- 979 1,741 29 Phoenix Business Campus -- 496 6,148 (754) Totals $2,325 $1,750 $11,929 $ (996)
Gross Amount At Which Carried At December 31, 1996 Buildings And Related Accumulated Date Depreciable Description Land Personal Total Depreciation Acquired Life-Years (amounts in thousands) Cedar Brooke $ 213 $ 3,831 $ 4,044 $2,528 2/27/87 5-19 Florida #11 979 1,770 2,749 563 10/15/90 5-20 Mini-Warehouse Phoenix Business 379 5,511 5,890 2,600 8/26/86 5-28 Campus Totals $ 1,571 $11,112 $12,683 $5,691 Also, the Partnership's one-third interest in the Florida #6 Mini-Warehouse has been classified as investment property held for sale. At December 31, 1996, the Partnership's net carrying value of the property is approximately $850,000. Johnstown/Consolidated Income Partners/2, an affiliated Partnership, owns the remaining two-thirds interest in the property. Reconciliation of "Investment Properties and Accumulated Depreciation" (in thousands): Years Ended December 31, 1996 1995 Investment Properties Balance at beginning of year $13,624 $15,482 Property improvements 152 112 Allocation of allowance for possible loss -- (1,970) Reclassification of investment property held for sale (1,093) -- Balance at End of Year $12,683 $13,624 Accumulated Depreciation Balance at beginning of year $ 5,420 $ 4,900 Additions charged to expense 514 520 Reclassification of investment property held for sale (243) -- Balance at end of year $ 5,691 $ 5,420 The aggregate cost of the real estate for Federal income tax purposes at December 31, 1996 and 1995, respectively, is approximately $14,596,000 and $14,444,000. The accumulated depreciation taken for Federal income tax purposes at December 31, 1996 and 1995, respectively, is approximately $5,828,000 and $5,215,000. NOTE L - INCOME TAXES Taxable income or loss of the Partnership is reported in the income tax returns of its partners. Accordingly, no provision for income taxes is made in the financial statements of the Partnership. Differences between the net loss or income as reported and Federal taxable income result primarily from (1) depreciation over different methods and lives and on differing cost bases of apartment properties, (2) change in rental income received in advance. The following is a reconciliation of reported net loss or income and Federal taxable income (in thousands, except unit data): 1996 1995 Net (loss) income as reported $ (109) $ 350 Add (deduct): Depreciation differences (99) (81) Unearned income 26 59 Other 340 (231) Accruals and prepaids 30 (35) Federal taxable income $ 188 $ 62 Federal taxable income $ 1.45 $ .48 per limited partnership unit The following is a reconciliation betweent the Partnership's reported amounts and Federal tax basis of net assets and liabilities (in thousands): Net assets as reported $ 7,955 Land and buildings 820 Accumulated depreciation 106 Syndication and distribution costs 3,825 Other 165 Net assets - Federal tax basis $12,871 ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. PART III ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT The Registrant has no officers or directors. The Managing General Partner manages and controls the Registrant and has general responsibility and authority in all matters affecting its business. The name of the directors and executive officers of ConCap Equities, Inc. ("CEI"), the Partnership's General Partner, as of December 31, 1996, their ages and the nature of all positions with CEI presently held by them are set forth below. There are no family relationships between or among any officers and directors. Name Age Position William H. Jarrard, Jr. 50 President Ronald Uretta 41 Vice President/Treasurer Martha L. Long 37 Senior Vice President - Finance/Controller John K. Lines 37 Vice President/Secretary Kelley M. Buechler 39 Assistant Secretary William H. Jarrard, Jr. has been President of CEI since December 1996 and Managing Director - Partnership Administration of Insignia since January 1991. Mr. Jarrard served as Managing Director - Partnership Administration and Asset Management from July 1994 until January 1996. Ronald Uretta has been Insignia's Treasurer since January 1992. Since August 1996, he has also served as Chief Operating Officer. He has also served as Secretary from January 1992 to June 1994 and as Chief Financial Officer from January 1992 to August 1996. Since September 1990, Mr. Uretta has also served as the Chief Financial Officer and Controller of Metropolitan Asset Group. Martha L. Long, Senior Vice President - Finance and Controller. In June 1994, Ms. Long joined Insignia as its Controller, and was promoted to Senior Vice- President - Finance in January 1997. Prior to this time, she was Senior Vice- President and Controller of The First Savings Bank, FSB in Greenville, SC. John K. Lines has been Secretary of CEI since December 1994 and General Counsel and Secretary of Insignia since July 1994. From May 1993 until June 1994, Mr. Lines was the Assistant General Counsel and Vice President of Ocwen Financial Corporation in West Palm Beach, Florida. From October 1991 until April 1993, Mr. Lines was a Senior Attorney with Banc One Corporation in Columbus, Ohio. From May 1984 until October 1991, Mr. Lines was employed as an associate with Squire Sanders & Dempsey in Columbus, Ohio. Kelley M. Buechler has been Assistant Secretary of CEI since December 1994 and Assistant Secretary of Insignia since 1991. During the five years prior to joining Insignia in 1991, she served in a similar capacity for U.S. Shelter. CEI is the General Partner of the Partnership and 15 other affiliated partnerships as of December 31, 1996. ITEM 10. EXECUTIVE COMPENSATION No direct compensation was paid or payable by the Partnership to directors or officers for the year ended December 31, 1996, nor was any direct compensation paid or payable by the Partnership to directors or officers of the General Partner for the year ended December 31, 1996. The Partnership has no plans to pay any such remuneration to any directors or officers of the General Partner in the future. See "Item 7 - Financial Statements, Note B - Related Party Transactions", for amounts of compensation and reimbursement of salaries paid by the Partnership to the General Partner and its affiliates and the former general partner and former affiliates. ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT (a) Security Ownership of Certain Beneficial Owners Except as provided below, as of March 1997, no person was known to CEI to own of record or beneficially more than five percent of the Units of the Partnership. Number of Percent Name and Address Units of total Insignia affiliates 11,572 8.98% One Insignia Financial Plaza Greenville, SC 29602 The majority of the Units noted above were acquired by Liquidity Assistance LLC, an affiliate of Insignia, from an unaffiliated Unitholder in December 1995 at a price of $61.10 per unit. (b) Beneficial Owners of Management Neither CEI nor any of the directors or officers or associates of CEI own any Units of the Partnership of record or beneficially. (c) Changes in Control Beneficial Owners of CEI As of March 1997, the following persons were known to CEI to be the beneficial owners of more than 5 percent (5%) of its common stock: NUMBER OF PERCENT NAME AND ADDRESS CEI SHARES OF TOTAL GII Realty, Inc. 100,000 100% One Insignia Financial Plaza Greenville, SC 29602 GII Realty, Inc. is owned by an affiliate of Insignia. (See "Item 1") ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Transactions with Current Management and Others Except for the transactions described below, neither CEI nor any of its directors, officers or associates, or any associates of any of them, has had any interest in any other transaction to which the Partnership is a party. Please refer to "Item 7 - Financial Statements, Note B - Related Party Transactions", for the amounts and items of permissible compensation and fees paid to the General Partner and its affiliates and other related parties for the last two years. The Partnership Agreement provides that the Partnership shall pay in monthly installments to the General Partner, or an affiliate, a yearly asset management fee equal to: (i) 3/8 of 1% of the original principal balance of mortgage loans outstanding at the end of the month preceding the installment payment; (ii) 1/8 of 1% of the market value of guaranteed mortgage-backed securities ("MBS") as of the end of the Partnership quarter immediately preceding the installment payment; and (iii) 5/8 of 1% of the purchase price of the properties plus improvements for managing the Partnership's assets. In the event the property was not owned at the beginning or end of the year, such fee shall be pro-rated for the short year period of ownership. The Partnership has paid property management fees based upon collected gross rental revenue for property management services in each of the years ended December 31, 1996 and 1995, respectively. All of the above-referenced agreements with affiliates of CEI and related parties of the Partnership are subject to the conditions and limitations imposed by the Partnership Agreement. ITEM 13. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K (a) Exhibits: Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report. See Exhibit Index contained herein for listing of exhibits. (b) Reports on Form 8-K filed during the fourth quarter of 1996: None. SIGNATURES In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. JOHNSTOWN/CONSOLIDATED INCOME PARTNERS By: CONCAP EQUITIES, INC. General Partner /s/William H. Jarrard, Jr. President /s/Ronald Uretta Ronald Uretta Vice President/Treasurer Date: March 24, 1997 In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated. /s/William H. Jarrard, Jr. President William H. Jarrard, Jr. /s/Ronald Uretta Vice President/Treasurer Ronald Uretta INDEX OF EXHIBITS EXHIBIT NO. DOCUMENT DESCRIPTION 3 Certificates of Limited Partnership, as amended to date (Incorporated by refer- ence to the Annual Report on Form 10-K for the year ended December 31, 1991) 10.1 Property Management Agreement No. 114 dated October 23, 1990, by and between the Partnership and CCEC (Incorporated by refer- ence to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.2 Property Management Agreement No. 309 dated October 23, 1990, by and between the Partnership and CCEC (Incorporated by refer- ence to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.3 Bill of Sale and Assignment dated October 23, 1990, by and between CCEC and ConCap Services Company (Incorporated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.4 Assignment and Assumption dated October 23, 1990, by and between CCEC and ConCap Management Limited Partnership ("CCMLP") (Incorporated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.5 Assignment and Agreement as to Certain Property Management Services dated October 23, 1990, by and between CCMLP and ConCap Capital Company (Incorporated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.6 Assignment and Assumption Agreement dated October 23, 1990, by and between CCMLP and The Hayman Company (100 Series of Property Management Contracts) (Incorporated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.7 Assignment and Assumption Agreement dated October 23, 1990, by and between CCMLP and Metro ConCap, Inc. (300 Series of Property Management Contracts) (Incorporated by refer- ence to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.8 Property Management Agreement No. 121 dated October 1, 1991, by and between the Partnership, Johnstown/Consolidated Income Partners/2 ("JCIP/2") and CCMLP (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.9 Property Management Agreement No. 122 dated October 1, 1991, by and between the Partnership and CCMLP (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.10 Assignment and Assumption Agreement dated October 1, 1991, by and between CCMLP and The Hayman Company (Property Management Agreements No. 121 and 122) (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.11 Assignment and Agreement as to Certain Property Management Services dated October 1, 1991, by and between CCMLP and ConCap Capital Company (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.12 Assignment and Assumption Agreement dated September 1, 1991, by and between the Partner- ship, and JCIP Associates, Ltd. (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.13 Construction Management Cost Reimbursement Agreement dated January 1, 1991, by and between the Partnership and Metro ConCap Inc. (Incorpor- ated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.14 Construction Management Cost Reimbursement Agreement dated January 1, 1991, by and between the Partnership and The Hayman Company (the "Hayman Construction Management Agreement") (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.15 Assignment and Assumption Agreement dated September 1, 1991, by and between the Partner- ship, and JCIP Associates, Ltd. (Hayman Con- struction Management Agreement) (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.16 Construction Management Cost Reimbursement Agreement dated October 1, 1991, by and between the Partnership and The Hayman Company (Incor- porated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.17 Construction Management Cost Reimbursement Agreement dated October 1, 1991, by and between the Partnership, Johnstown/Consolidated Income Partners/2 and The Hayman Company (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.18 Investor Services Agreement dated October 23, 1990 by and between the Partnership and CCEC (Incorpor- ated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.19 Assignment and Assumption Agreement (Investor Services Agreement) dated October 23, 1990, by and between CCEC and ConCap Services Company (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1990). 10.20 Letter of Notice dated December 20, 1991, from Partnership Services, Inc. ("PSI") to the Partnership regarding the change in ownership and dissolution of ConCap Services Company whereby PSI assumed the Investor Services Agreement (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.21 Financial Services Agreement dated October 23, 1990, by and between the Partnership and CCEC (Incorporated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.22 Financial Services Agreement dated October 23, 1990, by and between the Partnership and CCEC (Incorpor- ated by reference to the Quarterly Report on Form 10-Q for the quarter ended September 30, 1990). 10.23 Letter of Notice dated December 20, 1991, from PSI to the Partnership regarding the change in ownership and dissolution of ConCap Capital Company whereby PSI assumed the Financial Services Agreement (Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 1991). 10.24 Property Management Agreement No. 502 dated February 16, 1993, by and between the Partnership and Coventry Properties, Inc. (Incorporated by refer- ence to the Annual Report on Form 10-K for the year ended December 31, 1992). 10.25 Property Management Agreement No. 516 dated June 1, 1993, by and between the Partnership and Coventry Properties, Inc. 10.26 Property Management Agreement No. 517 dated June 1, 1993, by and between the Partnership and Coventry Properties, Inc. 10.27 Assignment and Agreement as to Certain Property Management Services dated November 17, 1993, by and between Coventry Properties, Inc. and Partnership Services, Inc. 10.28 Assignment and Agreement as to Certain Property Management Services dated November 17, 1993, by and between Coventry Properties, Inc. and Partnership Services, Inc. 10.29 Stock and Asset Purchase Agreement, dated December 8, 1994 (the "Gordon Agreement"), among MAE-ICC, Inc. ("MAE-ICC"), Gordon Realty Inc. ("Gordon"), GII Realty, Inc. ("GII Realty"), and certain other parties. (Incorporate by reference to Form 8-K dated December 8, 1994) 10.30 Exercise of the Option (as defined in the Gordon Agreement), dated December 8, 1994, between MAE-ICC and Gordon. (Incorporated by reference to Form 8-K dated December 8, 1994) 10.31 Exercise of the remaining portion of the option (as defined in the Gordon Agreement), dated December 8, 1994, between MAE-ICC and Gordon. (Incorporated by reference to Form 8-K dated October 24, 1995) 10.32 Multifamily Note dated November 1, 1996, between Johnstown/Consolidated Income Partners, a California limited partnership, and Lehman Brokers Holdings Inc. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings, Inc. 11 Statement regarding computations of Net Income per Limited Partnership Unit (Incorporated by reference to Note 1 of Item 8 - Financial Statements of this Form 10-K). 16.1 Letter, dated August 12, 1992, from Ernst & Young to the Securities and Exchange Commission regarding change in certifying accountant. (Incorporated by reference to Form 8-K dated August 6, 1992). 16.2 Letter dated May 9, 1995 from the Registrant's former independent accountant regarding its concurrence with the statements made by the Registrant regarding a change in the certifying accountant. (Incorporated by reference to Form 8-K dated May 3, 1995)
EX-27 2
5 This schedule contains summary financial information extracted from Johnstown Consolidated Income Partners 1996 Year-End 10-KSB and is qualified in its entirety by reference to such 10-KSB filing. 0000787621 JOHNSTOWN CONSOLIDATED INCOME PARTNERS 1,000 12-MOS DEC-31-1996 DEC-31-1996 1,583 447 28 0 0 0 12,683 5,691 10,574 0 2,325 0 0 0 7,955 10,574 0 2,260 0 0 2,138 0 191 0 0 0 0 (231) 0 (109) (.84) 0 Registrant has unclassified balance sheet. Multiplier is 1.
EX-10.32 3 Exhibit 10.32 Loan No. 734105908 Cedar Brooke MULTIFAMILY NOTE US $2,325,000.00 New York, New York As of November 1, 1996 FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings Inc., 3 World Financial Center, New York, New York 10285, or order, the principal sum of Two Million Three Hundred Twenty-five Thousand and 00/100 Dollars, with interest on the unpaid principal balance from the date of this Note, until paid, at the rate of 7.33 percent per annum. Interest only shall be payable at 3 World Financial Center, New York, New York 10285, or such other place as the holder hereof may designate in writing, in consecutive monthly installments of Fourteen Thousand Two Hundred One and 88/100 Dollars (US $14,201.88) on the first day of each month beginning December 1, 1996, until the entire indebtedness evidenced hereby is fully paid, except that any remaining indebtedness, if not sooner paid, shall be due and payable on November 1, 2003. If any installment under this Note is not paid when due, the entire principal amount outstanding hereunder and accrued interest thereon shall at once become due and payable, at the option of the holder hereof. The holder hereof may exercise this option to accelerate during any default by the undersigned regardless of any prior forbearance. In the event of any default in the payment of this Note, and if the same is referred to an attorney at law for collection or any action at law or in equity is brought with respect hereto, the undersigned shall pay the holder hereof all expenses and costs, including, but not limited to, attorney's fees. Prepayments shall be applied against the outstanding principal balance of this Note and shall not extend or postpone the due date of any subsequent monthly installments or change the amount of such installments, unless the holder hereof shall agree otherwise in writing. The holder hereof may require that any partial prepayments be made on the date monthly installments are due and be in the amount of that part of one or more monthly installments which would be applicable to principal. From time to time, without affecting the obligation of the undersigned or the successors or assigns of the undersigned to pay the outstanding principal balance of this Note and observe the covenants of the undersigned contained herein, without affecting the guaranty of any person, corporation, partnership or other entity for payment of the outstanding principal balance of this Note, without giving notice to or obtaining the consent of the undersigned, the successors or assigns of the undersigned or guarantors, and without liability on the part of the holder hereof, the holder hereof may, at the option of the holder hereof, extend the time for payment of said outstanding principal balance or any part thereof, reduce the payments thereon, release anyone liable on any of said outstanding principal balance, accept a renewal of this Note, modify the terms and time of payment of said outstanding principal balance, join in any extension or subordination agreement, release any security given herefor, take or release other or additional security, and agree in writing with the undersigned to modify the rate of interest or period of amortization of this Note or change the amount of the monthly installments payable hereunder. Presentment, notice of dishonor, and protest are hereby waived by all makers, sureties, guarantors and endorsers hereof. This Note shall be the joint and several obligation of all makers, sureties, guarantors and endorsers, and shall be binding upon them and their successors and assigns. The indebtedness evidenced by this Note is secured by a Mortgage or Deed of Trust dated as of the date hereof, and reference is made thereto for rights as to acceleration of the indebtedness evidenced by this Note. This Note shall be governed by the law of the jurisdiction in which the Property subject to the Mortgage or Deed of Trust is located. The undersigned shall pay any installment of interest due hereunder within ten (10) calendar days after such installment of interest is due. The undersigned shall pay any other installment due hereunder or due in accordance with the terms of the Mortgage or Deed of Trust securing this Note, within thirty (30) calendar days of the date such installment is due. Oral agreements or commitments to loan money, extend credit or to forbear from enforcing repayment of a debt including promises to extend or renew such debt are not enforceable. To protect you (borrower(s)) and us (creditor) from misunderstanding or disappointment, any agreements we reach covering such matters are contained in this writing, which is the complete and exclusive statement of the agreement between us, except as we may later agree in writing to modify it. The foregoing disclosure has been added pursuant to Sec. 432.045 R.S.Mo. and for purposes thereof, the term "this writing" shall be deemed to mean the Instrument, this Note and all other documents entered into between Borrower and lender of even date herewith. Reference is made to that certain Rider to Multifamily Note (Prepayment Premium/Yield Maintenance), that certain Default Interest Rider to Multifamily Note and that certain Exculpation Rider to Note and Security Instrument, each dated as of the date hereof and each hereby incorporated herein. IN WITNESS WHEREOF, Borrower has executed this Note or has caused the same to be executed by its representatives thereunto duly authorized. JOHNSTOWN/CONSOLIDATED INCOME PARTNERS a California limited partnership By: ConCap Equities, Inc., a Delaware corporation, its general partner By:/s/ William H. Jarrard Name: William H. Jarrard Title: Vice President PAY TO THE ORDER OF FEDERAL HOME LOAN MORTGAGE CORPORATION WITHOUT RECOURSE. This 1st day of November, 1996. LEHMAN BROTHERS HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings Inc., a Delaware corporation By: /s/ Larry J. Kravetz Name: Larry J. Kravets Title: Vice President -----END PRIVACY-ENHANCED MESSAGE-----