-----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, UTtLOyHXXnCOqpLZnCj7FKbDaDy4s1kMhvode/hB4izT+hR3wuUjUtlmlDY9Ow6i yqZr++YxfKezMviqH6iiew== 0001047469-98-038699.txt : 19981102 0001047469-98-038699.hdr.sgml : 19981102 ACCESSION NUMBER: 0001047469-98-038699 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980930 FILED AS OF DATE: 19981030 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KEYSTONE MORTGAGE FUND II CENTRAL INDEX KEY: 0000812084 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] IRS NUMBER: 954061580 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-15537 FILM NUMBER: 98733628 BUSINESS ADDRESS: STREET 1: 11340 W OLYMPIC BLVD STE 300 CITY: LOS ANGELES STATE: CA ZIP: 90064 BUSINESS PHONE: 2134794121 MAIL ADDRESS: STREET 1: 11340 W OLYMPIC BLVD STREET 2: SUITE 300 CITY: LOS ANGELES STATE: CA ZIP: 90064 10-Q 1 10-Q - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 -------------------- FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR QUARTER ENDED COMMISSION FILE NUMBER SEPTEMBER 30, 1998 0-15537 ------------------------- KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP (Exact name of registrant as specified in its charter.) CALIFORNIA 95-4061580 (State of Incorporation) (I.R.S. Employer Identification No.) 11340 W. OLYMPIC BOULEVARD SUITE 300 LOS ANGELES, CALIFORNIA 90064-1661 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (310) 479-4121 ----------------------------------------------- Indicated by check mark whether the registrant (1) has filed all report required to be filed by Section 13 of 15(d) of the Securities Exchange Act of 1934 during the preceding 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 _____ KEYSTONE MORTGAGE FUND II A CALIFORNIA LIMITED PARTNERSHIP INDEX
PAGE ---- PART I. FINANCIAL INFORMATION Item 1. Financial Statements. (a) Condensed Balance Sheets, December 31, 1997 and September 30, 1998.................. 3 (b) Condensed Statements of Income, three and nine months ended, September 30, 1998 and 1997......................................................... 4 (c) Condensed Statements of Partners' Capital (Deficit) for the year ended December 31, 1997 and the nine months ended September 30, 1998...................... 5 (d) Condensed Statements of Cash Flows, nine months ended September 30, 1998 and 1997......................................................... 6 (e) Notes to condensed financial statements............................................. 7 & 8 Item 2. Management's discussion and analysis of financial condition and results of operations............................................................ 9 PART II. OTHER INFORMATION Item 6. Exhibits and reports on Form 8-K................................................. 10 & 11
2 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP BALANCE SHEETS ASSETS
(Unaudited) *December 31 September 30 1997 1998 -------------------------- Current assets: Cash and cash equivalents................................................. $ 12,484 $ 9,281 Short-term investments (market value of $392,695 in 1997 and $473,252 in 1998).................................................. 392,695 473,252 Interest receivable on trust deed notes receivable........................ 9,162 9,043 Current portion of trust deed notes receivable (note B)................... 35,727 1,381,185 ---------- ---------- Total current assets.............................................. 450,068 1,872,761 Trust deed notes receivable, net (note B)................................... 1,368,718 ---------- ---------- $1,818,786 $1,872,761 ---------- ---------- ---------- ---------- LIABILITIES AND PARTNERS' CAPITAL Current Liabilities: Accounts payable and other liabilities................................... $ 11,120 $ 602 Due general partners..................................................... 269,000 276,500 ---------- ---------- Total Current Liabilities........................................ 280,120 277,102 Partners' capital: General Partners......................................................... 632 1,202 Limited Partners - authorized 41,459 units; outstanding 41,459 units.............................................. 1,538,034 1,594,457 ---------- ---------- Net partners' capital............................................ 1,538,666 1,595,659 ---------- ---------- $1,818,786 $1,872,761 ---------- ---------- ---------- ----------
See accompanying notes to financial statements. * Extracted from audited December 31, 1997 financial statements. 3 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP CONDENSED STATEMENTS OF INCOME (UNAUDITED)
Nine Months Ended Three Months Ended September 30 September 30 1998 1997 1998 1997 ---------------------- ---------------------- Revenue: Interest on mortgage loans................................. $ 83,837 $ 84,057 $ 27,706 $ 28,096 Interest on short-term investments......................... 12,618 32,294 3,631 11,541 -------- -------- -------- -------- 96,455 116,351 31,337 39,637 Expenses: Servicing related expenses 26,734 25,810 7,421 4,368 General and administrative expenses 12,728 16,067 4,518 4,724 -------- -------- -------- -------- 39,462 41,877 11,939 9,092 -------- -------- -------- -------- NET INCOME............................................. $ 56,993 $ 74,474 $ 19,398 $ 30,545 -------- -------- -------- -------- -------- -------- -------- -------- Weighted average number of limited partnership units outstanding....................... 41,459 41,459 41,459 41,459 -------- -------- -------- -------- -------- -------- -------- -------- Net income per limited partnership unit...................... $ 1.37 $ 1.80 $ .47 $ .74 -------- -------- -------- -------- -------- -------- -------- --------
See notes to financial statements 4 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP STATEMENTS OF PARTNER'S CAPITAL (DEFICIT)
General Limited Partners Partners Total -------- -------- ----- Balance at December 31, 1997.............................. $ 632 $1,538,034 $1,538,666 Net income nine months ended September 30, 1998........... 570 56,423 56,993 ---------- ---------- ---------- Balance as of September 30, 1998 (unaudited).............. $ 1,202 $1,594,457 $1,595,659 ---------- ---------- ---------- ---------- ---------- ----------
5 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP STATEMENTS OF CASH FLOWS
Nine Months Ended September 30 ------------------------------ 1998 1997 ---- ---- OPERATING ACTIVITIES: Net Income............................................. $ 56,993 $ 74,474 Changes in operating assets and liabilities: Amortization of net origination fees................ (1,275) (1,275) Decrease in interest and accounts receivable........ 119 119 Increase in due general partners.................... 7,500 7,500 Decrease in accounts payable........................ (10,518) (679) --------- --------- NET CASH PROVIDED BY OPERATING ACTIVITIES...... 52,819 80,139 INVESTING ACTIVITIES: Decrease in notes receivable........................... 24,535 26,429 Increase in short-term investments..................... (80,557) (233,410) FINANCING ACTIVITIES: General Partners contributions........................... - 0 - 206,601 Distribution and withdrawals............................. - 0 - (86,609) --------- --------- Decrease in cash and cash equivalents.................. (3,203) (6,850) Cash and cash equivalents at beginning year............ 12,484 15,808 --------- --------- CASH AND CASH EQUIVALENTS AT END OF PERIOD............................... $ 9,281 $ 8,958 --------- --------- --------- ---------
See notes to financial statements 6 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP NOTES TO CONDENSED FINANCIAL STATEMENTS NOTE A - UNAUDITED BASIS OF PRESENTATION The accompanying unaudited condensed financial statements have been prepared by Keystone Mortgage Fund II in accordance with generally accepted accounting principles, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the accompanying condensed financial statements contain all adjustments necessary, which were of normal recurring nature, for a fair statement of the results for the interim periods presented. It is suggested that these condensed financial statements be read in conjunction with the financial statements and the notes thereto included in Form 10-K for the year ended December 31, 1997 filed by the Company under the Securities Exchange Act of 1934. 7 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (CONTINUED) (B) TRUST DEED NOTES RECEIVABLE
Monthly Payment, including December 31 September 30 interest 1997 1998 -------- ---- ---- First trust deed on industrial building, interest rate, adjusted every six months at 2.65% plus 11th District monthly weighted average cost of funds, due February 1, 1999................... $ 11,426 $1,470,285 $1,445,750 ---------- ---------- Less current portion........................................................ 35,727 1,381,185 Less net deferred loan origination fees..................................... 1,840 565 Less allowance for loss..................................................... 64,000 64,000 ---------- ---------- Net concurrent trust deed notes receivable............................. $1,368,718 $ - 0 - ---------- ---------- ---------- ----------
8 KEYSTONE MORTGAGE FUND II, A CALIFORNIA LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (CONTINUED) ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Revenue for the nine months ended September 30, 1998 decreased $19,896 or 17.1% over the same period September 30, 1997. Revenue for the three months ended September 30, 1998 decreased $8,300 or 20.9% for the same period ending September 30, 1997. This decrease was due to a decrease in interest income as a result of distribution of loan payoff to limited partners. Servicing expenses increased 3.5% and general and administrative expenses decreased 20.8% for the nine months ended September 30, 1998 over the same period ended September 30, 1997. Servicing expenses increased 69.9% and general and administrative expenses increased 4.4% for the three months ended September 30, 1998 over the same perios ended September 30, 1997. Net income decreased $17,481 or 23.5% for the nine months ended September 30, 1998 over the same peiod ended September 30, 1997. Net income decreased $11,147 or 36.5% for the three months ended September 30, 1998 over the same period ended September 30, 1997. Working capital increased $1,595,659 for nine months ended September 30, 1998. The Partnership has adequate working capital and cash reserved to carry on its business. The Partnership continues to distribute to the Limited Partners principal repayments less required reserves. Revenues and net income continue to decrease as the Partnership liquidates its assets. 9 PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) The Registrant filed no reports on Form 8-K during the quarter ended September 30, 1998. 10 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. KEYSTONE MORTGAGE FUND II a California Limited Partnership Date: October 30, 1998 /S/ John P. Sullivan ---------------------------------- Keystone Mortgage Company By: John P. Sullivan, President Date: October 30, 1998 /S/ John P. Sullivan ---------------------------------- John P. Sullivan General Partner Date: October 30, 1998 /S/ Christopher E. Turner ---------------------------------- Christopher E. Turner General Partner 11 EX-27 2 EXHIBIT 27
5 9-MOS DEC-31-1998 SEP-30-1998 9,281 473,252 9,043 0 0 1,872,761 0 0 1,872,761 277,102 0 0 0 0 1,595,659 1,872,761 0 96,455 0 39,462 0 0 0 56,993 0 56,993 0 0 0 56,993 1.37 1.37
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