0000950168-95-000707.txt : 19950818
0000950168-95-000707.hdr.sgml : 19950818
ACCESSION NUMBER: 0000950168-95-000707
CONFORMED SUBMISSION TYPE: 10QSB
PUBLIC DOCUMENT COUNT: 2
CONFORMED PERIOD OF REPORT: 19950630
FILED AS OF DATE: 19950814
SROS: NONE
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: ANGELES PARTNERS XV
CENTRAL INDEX KEY: 0000788331
STANDARD INDUSTRIAL CLASSIFICATION: 6500
IRS NUMBER: 954046025
STATE OF INCORPORATION: CA
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 10QSB
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-15546
FILM NUMBER: 95563397
BUSINESS ADDRESS:
STREET 1: ONE INSIGNIA FINANCIAL PLZ
STREET 2: PO BOX 1089
CITY: GREENVILLE
STATE: SC
ZIP: 29602
BUSINESS PHONE: 8032391000
MAIL ADDRESS:
STREET 1: ONE INSIGNIA FINANCIAL PLAZA
STREET 2: P.O. BOX 1089
CITY: GREENVILLE
STATE: SC
ZIP: 29602
10QSB
1
FORM 10-QSB INSIGNIA 82101
FORM 10-QSB.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period.........to.........
Commission file number 0-15546
ANGELES PARTNERS XV
(Exact name of small business issuer as specified in its charter)
California 95-4046025
(State or other jurisdiction of (IRS 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 (803) 239-1000
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes X No
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) ANGELES PARTNERS XV
STATEMENT OF NET LIABILITIES IN LIQUIDATION
June 30, 1995
Assets
Cash:
Unrestricted $ 296,645
Restricted--tenant security deposits 29,938
Accounts receivable 84,006
Escrow for taxes 60,285
Other assets 54,228
Investment properties 17,475,000
18,000,102
Liabilities
Accounts payable 2,882
Tenant security deposits 28,706
Property taxes 164,736
Interest 2,567,606
Other 26,714
Mortgage notes payable in default 18,804,292
Estimated costs during the period
of liquidation (Note A) 285,242
21,880,178
Net liabilities in liquidation (Note A) $(3,880,076)
See Accompanying Notes to Financial Statements
1
b) ANGELES PARTNERS XV
STATEMENT OF CHANGES IN NET LIABILITIES IN LIQUIDATION
June 30, 1995
Net liabilities in liquidation
at December 31, 1994 $(5,861,591)
Changes in net liabilities in liquidation
attributed to:
Increase in unrestricted cash 118,863
Decrease in restricted cash (27,998)
Decrease in accounts receivable (2,020)
Decrease in escrows for taxes (93,641)
Increase in other assets 7,848
Increase in investment properties 2,373,862
Decrease in accounts payable 65,179
Increase in accrued taxes (17,167)
Decrease in tenant security deposit liabilities 131,234
Increase in accrued interest (1,232,255)
Decrease in other liabilities 244,154
Decrease in mortgage notes payable 21,524
Decrease in estimated costs during the
period of liquidation 391,932
Net liabilities in liquidation at
June 30, 1995 $(3,880,076)
See Accompanying Note to Financial Statements
2
c) ANGELES PARTNERS XV
STATEMENT OF OPERATIONS
(Unaudited)
(Going Concern Basis)
Three Months Ended Six Months Ended
June 30, 1994 June 30, 1994
Revenues:
Rental income $2,034,361 $3,102,548
Other income 53,320 98,557
Total revenues 2,087,681 3,201,105
Expenses:
Operating 143,395 252,383
General and administrative 85,886 150,988
Property management fees 31,039 72,011
Maintenance 145,431 165,269
Depreciation 359,478 776,428
Amortization 18,783 35,160
Interest 886,365 1,796,718
Property taxes 112,082 198,768
Bad debt 39,799 39,799
Tenant reimbursements (120,456) (193,064)
Total expenses 1,701,802 3,294,460
Gain on sale of investment properties -- 408,901
Net income $ 385,879 $ 315,546
Net income allocated to general
partners (1%) $ 3,859 $ 3,155
Net income allocated to limited
partners (99%) 382,020 312,391
Net income $ 385,879 $ 315,546
Net loss per limited partnership unit $ 22.06 $ 18.04
See Accompanying Notes to Financial Statements
3
d) ANGELES PARTNERS XV
STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30, 1994
Cash flows from operating activities:
Net income $ 315,546
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 776,428
Amortization of loan costs and lease
commissions 165,493
Gain on sale of investment properties (408,901)
Bad debt 39,799
Change in accounts:
Restricted cash (41,817)
Accounts receivable (42,358)
Escrow deposits for taxes 413,830
Other assets (88,706)
Accounts payable (697)
Property taxes (75,692)
Tenant security deposits (51,635)
Accrued interest 378,979
Other liabilities 261,353
Net cash provided by
operating activities 1,641,622
Cash flows from investing activities:
Proceeds from the sale of investment
properties 110,606
Property improvements and replacements (97,418)
Net cash provided by investing
activities 13,188
Cash flows used in financing activities:
Principal payments on notes payable (1,548,776)
Additional borrowings 35,852
Net cash used in financing
activities (1,512,924)
Increase in cash 141,886
Cash at beginning of period 482,508
Cash at end of period $ 624,394
Supplemental cash flow information:
Cash paid during the period for interest $ 1,337,907
See Accompanying Notes to Financial Statements
4
e) ANGELES PARTNERS XV
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Note A Basis of Presentation
As of December 31, 1994, the Partnership adopted the liquidation
basis of accounting. The Partnership has experienced significant
recurring operating losses. Also, the Partnership sold six of the
eleven Cleveland Industrial Complex ("Cleveland") buildings and the
Rancho Park Office Building during 1994. The Partnership is in default
on recourse indebtedness totaling $3,500,000 due to Angeles Mortgage
Investment Trust ("AMIT"). Of this debt, $1,500,000 is secured by one
of the remaining Cleveland buildings and AMIT placed the property in
receivership in January 1995, with the intent to foreclose during 1995.
The remaining $2,000,000 is recourse to the Partnership and AMIT
received a default judgement against the Partnership on January 18,
1995. At this time, the Managing General Partner believes the equity in
the remaining Cleveland buildings is not sufficient to retire the AMIT
debt, therefore, the Managing General Partner expects to transfer the
Partnership's interest in the remaining Cleveland buildings to AMIT as
full satisfaction of the debt. These transactions are anticipated to
occur during the third and fourth quarters of 1995. The Partnership does
not expect to contest any of these proceedings. In March 1995, the
lender on the non-recourse debt secured by the Marina Plaza notified the
Partnership that this debt was in default and initiated foreclosure
proceedings. Marina Plaza was placed into receivership in June 1995 and
was foreclosed upon in August 1995. The Partnership does not intend to
purchase any additional properties and the Managing General Partner has
decided to terminate the Partnership upon foreclosure of the final
property.
As a result of the decision to liquidate the Partnership, the
Partnership changed its basis of accounting for its financial statements
at December 31, 1994, from the going concern basis of accounting to the
liquidation basis of accounting in accordance with generally accepted
accounting principles. Consequently, assets have been valued at
estimated net realizable value (including subsequent actual transactions
described below) and liabilities are presented at their estimated
settlement amounts, including estimated costs associated with carrying
out the liquidation. The valuation of assets and liabilities
necessarily requires many estimates and assumptions and there are
substantial uncertainties in carrying out the liquidation. The actual
realization of assets and settlement of liabilities could be higher or
lower than amounts indicated and is based upon the Managing General
Partner's estimates as of the date of the financial statements.
The statements of consolidated net liabilities in liquidation as
of June 30, 1995, include approximately $285,000 of costs, net of
income, that the Managing General Partner estimates will be incurred
during the period of liquidation, based on the assumption that the
liquidation process will be completed by December 31, 1995. These costs
include anticipated legal fees, administrative expenses, and loss from
property operations. Because the success in realization of assets and
the settlement of liabilities is based on the Managing General Partner's
best estimates, the liquidation period may be shorter than projected or
it may be extended beyond the projected period.
5
Note A - Basis of Presentation - continued
The accompanying unaudited, condensed, consolidated financial
statements at June 30, 1995, have been prepared in accordance with
generally accepted accounting principles for interim financial
information under the liquidation basis of accounting 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 the Managing General Partner,
all adjustments considered necessary for a fair presentation on the
liquidation basis have been included. Operating results for the six
month period ended June 30, 1995, are not necessarily indicative of the
results that may be expected for the fiscal year ending December 31,
1995. For further information, refer to the financial statements and
footnotes thereto included in the Partnership's annual report on Form
10-KSB for the year ended December 31, 1994.
Note B - Angeles Acceptance Pool, Angeles Mortgage Investment Trust
In November 1992, Angeles Acceptance Pool ("AAP"), a Delaware
limited partnership was organized to acquire and hold the obligations
evidencing the working capital loan previously provided by Angeles
Capital Investment, Inc. ("ACCI"). Angeles Corporation ("Angeles") is
the 99% limited partner of AAP and Angeles Acceptance Directives,
Inc.("AAD"), an affiliate of the General Partner, was, until April 14,
1995, the 1% General Partner of AAP. On April 14, 1995, as part of a
settlement of claims between affiliates of the General Partner and
Angeles, AAD resigned as general partner of AAP and simultaneously
received a 1/2% limited partner interest in AAP. An affiliate of
Angeles now serves as the general partner of AAP.
AAP's working capital loan funded the Partnership's operating
deficits in prior years. Total indebtedness, which is included as a
note payable, was $1,582,408 at June 30, 1995, and June 30, 1994, with
monthly interest only payments at prime plus 2%. Principal is to be
paid the earlier of i) the availability of funds, ii) the sale of one or
more properties owned by the Partnership, or iii) November 25, 1997.
Total interest expense for this loan was $86,373 for the six months
ended June 30, 1995, and was $67,912 for the six months ended June 30,
1994.
Angeles Mortgage Investment Trust ("AMIT"), a real estate
investment trust, has provided secondary financing to the Partnership
secured by the Partnership's investment properties known as Cleveland
Industrial and Marina Plaza. One of the notes in the amount of $600,000
secured by one of the Cleveland Industrial buildings was assumed by the
purchaser of the building during 1994. Total interest expense was
$335,617 and $261,302 for the six months ended June 30, 1995 and 1994,
respectively.
6
Note B - Angeles Acceptance Pool, Angeles Mortgage Investment Trust
(continued)
MAE GP Corporation ("MAE GP"), an affiliate of the General
Partner, owns 1,675,113 Class B Shares of AMIT. MAE GP has the option
to convert these Class B Shares, in whole or in part, into Class A
Shares on the basis of the 1 Class A Share for every 49 Class B Shares.
These Class B Shares entitle MAE GP to receive 1% of the distributions
of net cash distributed by AMIT. These Class B
Shares also entitle MAE GP to vote on the same basis as Class A Shares
which allows MAE GP to vote approximately 33% of the total shares
(unless and until converted to Class A Shares at which time the
percentage of the vote controlled represented by the shares held by MAE
GP would approximate 1% of the vote). Between the date of acquisition
of these shares (November 24, 1992) and March 31, 1995, MAE GP declined
to vote these shares. Since that date, MAE GP voted its shares at the
1995 annual meeting in connection with the election of trustees and
other matters. To date, MAE GP has abstained from either controlling or
participating in the management of AMIT. However, MAE GP may choose to
vote these shares as it deems appropriate in the future.
As part of the above described settlement, MAE GP granted to AMIT
an option to acquire the Class B shares owned by it. This option can be
exercised at the end of 10 years or when all loans made by AMIT to
partnerships affiliated with MAE GP as of November 9, 1997, (which is
the date of execution of a definitive Settlement Agreement) have been
paid in full, but in no event prior to November 9, 1997. AMIT delivered
to MAE GP cash in the sum of $250,000 at closing, which occurred April
14, 1995, as payment for the option. Upon exercise of the option, AMIT
would remit to MAE GP an additional $94,000.
Simultaneously with the execution of the option, MAE GP executed
an irrevocable proxy in favor of AMIT thereby enabling MAE GP to vote
the Class B shares on all matters except those involving transactions
between AMIT and MAE GP affiliated borrowers or the election of any MAE
GP affiliate as an officer or trustee of AMIT. On those matters, MAE GP
granted to the AMIT trustees, in their capacity as trustees of AMIT,
proxies with regard to the Class B shares instructing such trustees to
vote said Class B shares in accordance with the vote of the majority of
Class A Shares voting to be determined without consideration of the
votes of "Excess Class A Shares" as defined in Section 6.13 of the
Declaration of Trust of AMIT.
7
Note C Transactions with Affiliated Parties
The Partnership has no employees and is dependent on the Managing
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 as reimbursement of certain
expenses incurred by affiliates on behalf of the Partnership.
The following transactions with the Managing General Partner and
affiliates for the six months ended June 30, 1995 and 1994 are as
follows:
1995 1994
Property management fees $ 52,628 $ 53,715
Reimbursement for services of affiliates 69,107 91,962 (1)
(1) $23,260 of the reimbursements due to affiliates of Insignia
had not been paid as of June 30, 1995, and $282,471 as of
June 30, 1994.
The Partnership insures its properties under a master policy
through an agency and insurer unaffiliated with the Managing General
Partner. An affiliate of the Managing 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 Managing General Partner, who
receives payments on these obligations from the agent. The amount of
the partnership's insurance premiums accruing to the benefit of the
affiliate of the Managing General Partner by virtue of the agent's
obligations is not significant. See Note B with respect to transactions
between the Partnership and AMIT and AAP.
8
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
As of December 31, 1994, the Partnership adopted the liquidation
basis of accounting. The Partnership has experienced significant
recurring operating losses. Also, the Partnership sold six of the
eleven Cleveland Industrial Complex ("Cleveland") buildings and the
Rancho Park Office Building during 1994. The Partnership is in default
on recourse indebtedness totaling $3,500,000 due to Angeles Mortgage
Investment Trust ("AMIT"). Of this debt, $1,500,000 is secured by one
of the remaining Cleveland buildings and AMIT placed the property in
receivership in January 1995, with the intent to foreclose during 1995.
The remaining $2,000,000 is recourse to the Partnership and AMIT
received a default judgement against the Partnership on January 18,
1995. At this time, the Managing General Partner believes the equity in
the remaining Cleveland buildings is not sufficient to retire the AMIT
debt. The Partnership does not expect to contest any of these
proceedings. In March 1995, the lender on the non-recourse debt secured
by the Marina Plaza notified the Partnership that this debt was in
default and foreclosed on the property in August 1995. The Partnership
does not intend to purchase any additional properties and the Managing
General Partner has decided to terminate the Partnership upon
foreclosure of the final property.
Liquidity and Capital Resources
For the six months ended June 30, 1995, the Partnership recorded a
net decrease in net liabilities in liquidation of $1,981,515. The
decrease is primarily due to an increase in the net realizable value of
its investment properties resulting from an appraisal performed by a
third party on the Cleveland Industrial buildings valuing the property
higher than the Managing General Partner estimated at December 31, 1994.
Also contributing to the decrease in net liabilities in liquidation was
a decrease in estimated costs during the liquidation period. The
Managing General Partner had anticipated that Marina Plaza would
foreclose in September 1995, but the proceedings were completed in early
August. The Managing General Partner also believes that the remaining
Cleveland Industrial buildings will be lost during the fourth quarter of
1995. There can be no assurance that all transactions will be complete
as of December 31, 1995.
The statements of consolidated net liabilities in liquidation as
of June 30, 1995, include approximately $285,000 of costs, net of
income, that the Managing General Partner estimates will be incurred
during the period of liquidation, based on the assumption that the
liquidation process will be completed by December 31, 1995. These costs
include anticipated legal fees ($15,000), administrative expenses
($265,000), and loss from property operations ($5,000). Because the
success in realization of assets and the settlement of liabilities is
based on the Managing General Partner's best estimates, the liquidation
period may be shorter than projected or it may be extended beyond the
projected period.
9
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In January 1995, Angeles Mortgage Investment Trust ("AMIT"), began
foreclosure proceedings on one of the remaining Cleveland Industrial
Buildings and the property was placed in receivership at this time.
Management expects the foreclosure proceedings to be complete by the
third quarter of 1995. In March 1995, the Partnership received a notice
of default from the lender on Marina Plaza and it was foreclosed upon in
August 1995.
MAE GP Corporation ("MAE GP"), an affiliate of the General
Partner, owns 1,675,113 Class B Shares of AMIT. MAE GP has the option
to convert these Class B Shares, in whole or in part, into Class A
Shares on the basis of the 1 Class A Share for every 49 Class B Shares.
These Class B Shares entitle MAE GP to receive 1% of the distributions
of net cash distributed by AMIT. These Class B
Shares also entitle MAE GP to vote on the same basis as Class A Shares
which allows MAE GP to vote approximately 33% of the total shares
(unless and until converted to Class A Shares at which time the
percentage of the vote controlled represented by the shares held by MAE
GP would approximate 1% of the vote). Between the date of acquisition
of these shares (November 24, 1992) and March 31, 1995, MAE GP declined
to vote these shares. Since that date, MAE GP voted its shares at the
1995 annual meeting in connection with the election of trustees and
other matters. MAE GP has not exerted, and continues to decline to
exert, any management control over or participate in the management of
AMIT. However, MAE GP may choose to vote these shares as it deems
appropriate in the future.
As part of the above described settlement, MAE GP granted to AMIT
an option to acquire the Class B shares owned by it. This option can be
exercised at the end of 10 years or when all loans made by AMIT to
partnerships affiliated with MAE GP as of November 9, 1997, (which is
the date of execution of a definitive Settlement Agreement) have been
paid in full, but in no event prior to November 9, 1997. AMIT delivered
to MAE GP cash in the sum of $250,000 at closing, which occurred April
14, 1995, as payment for the option. Upon exercise of the option, AMIT
would remit to MAE GP an additional $94,000.
Simultaneously with the execution of the option, MAE GP executed
an irrevocable proxy in favor of AMIT the result of which is MAE GP will
be able to vote the Class B shares on all matters except those involving
transactions between AMIT and MAE GP affiliated borrowers or the
election of any MAE GP affiliate as an officer or trustee of AMIT. On
those matters, MAE GP granted to the AMIT trustees, in their capacity as
trustees of AMIT, proxies with regard to the Class B shares instructing
such trustees to vote said Class B shares in accordance with the vote of
the majority of Class A Shares voting to be determined without
consideration of the votes of "Excess Class A Shares" as defined in
Section 6.13 of the Declaration of Trust of AMIT.
Except for the issues stated, the Registrant is unaware of any
pending or outstanding litigation that is not of a routine nature. The
Managing General Partner of the Registrant 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.
10
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 June 30, 1995.
11
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.
ANGELES PARTNERS XV
By: Angeles Realty Corporation II
Corporate General Partner
By: /s/Carroll D. Vinson
Carroll D. Vinson
President
By: /s/Robert D. Long, Jr.
Robert D. Long, Jr.
Controller and Principal Accounting
Officer
Date: August 14, 1995
12
EX-27
2
FINANCIAL DATA SCHEDULE
5
1
6-MOS
DEC-31-1995
JUN-30-1995
296,645
0
84,006
0
0
525,102
17,475,000
0
18,000,102
3,075,886
18,804,292
0
0
0
(3,880,076)
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0