-----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, P7FImBQmAVK1fCrM7CuHvpCjzeN7cNOp/gm4FoaloQ23Mzy3XM9otyWKPrYEAgAL frmItgqSAesMxw5+x3Q69A== 0000927016-02-004015.txt : 20020813 0000927016-02-004015.hdr.sgml : 20020813 20020813111500 ACCESSION NUMBER: 0000927016-02-004015 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20020630 FILED AS OF DATE: 20020813 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COPLEY PENSION PROPERTIES VI CENTRAL INDEX KEY: 0000824209 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 042988542 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-17807 FILM NUMBER: 02728335 BUSINESS ADDRESS: STREET 1: WORLD TRADE CENTER EAST STREET 2: TWO SEAPORT LANE CITY: BOSTON STATE: MA ZIP: 02210 BUSINESS PHONE: 6172619000 MAIL ADDRESS: STREET 1: WORLD TRADE CENTER EAST STREET 2: TWO SEAPORT LANE CITY: BOSTON STATE: MA ZIP: 02210 FORMER COMPANY: FORMER CONFORMED NAME: NEW ENGLAND PENSION PROPERTIES VI DATE OF NAME CHANGE: 19880113 10-Q 1 d10q.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ----------------------------------------- For Quarter Ended June 30, 2002 Commission File Number 0-17807 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP (Exact name of registrant as specified in its charter) Massachusetts 04-2988542 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) World Trade Center East Two Seaport Lane, 16th Floor Boston, Massachusetts 02210 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (617) 261-9000 ---------------------------------------------------------------------------- Former name, former address and former fiscal year if changed since last report Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve (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 1 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP FORM 10-Q FOR QUARTER ENDED JUNE 30, 2002 PART I FINANCIAL INFORMATION 2 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP STATEMENTS OF NET ASSETS IN LIQUIDATION
June 30, 2002 December 31, 2001 (Unaudited) (Audited) --------------- ----------------- Assets Other assets $ 16,369 $ 41,979 Cash and cash equivalents 946,204 1,008,448 --------------- -------------- $ 962,573 1,050,427 =============== ============== Liabilities and Partners' Capital Accounts payable $ 5,667 $ 82,604 Accrued expenses for liquidation 92,204 115,425 --------------- -------------- Total liabilities 97,871 198,029 --------------- -------------- Net assets in liquidation: Limited partners ($0 per unit; 160,000 units authorized 48,788 units issued and outstanding) 800,842 788,661 General partners 63,860 63,737 --------------- -------------- Total partners' capital 864,702 852,398 --------------- -------------- $ 962,573 $ 1,050,427 =============== ==============
(See accompanying notes to unaudited financial statements) 3 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP STATEMENTS OF CHANGES OF NET ASSETS IN LIQUIDATION (Unaudited)
Three Months Ended Six Months Ended June 30, 2002 June 30, 2002 ------------- ------------- Net Assets in liquidation at beginning of period $860,582 $852,398 -------- -------- Increase during period: Operating Activities Interest Income 4,120 12,304 -------- -------- Net change in net assets in liquidation 4,120 12,304 -------- -------- Net assets in liquidation at end of period $864,702 $864,702 ======== ========
(See accompanying notes to unaudited financial statements) 4 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended Six Months Ended June 30, 2001 June 30, 2001 ------------------- --------------- Investment Activity Property rentals $ 197,234 $ 423,743 Property operating expenses (47,081) (110,126) Depreciation and amortization (46,827) (94,905) ----------- ------------ 103,326 218,712 Joint venture earnings 8,255 24,928 ----------- ------------ Total real estate operations 111,581 243,640 Gain (loss) on sale of joint venture (9,788) 962,890 ----------- ------------ Total real estate activity 101,793 1,206,530 Interest on cash equivalents 26,466 57,287 ----------- ------------ Total investment activity 128,259 1,263,817 ----------- ------------ Portfolio Expenses Management fee 31,193 31,193 General and administrative 40,238 76,376 ----------- ------------ 71,431 107,569 ----------- ------------ Net income $ 56,828 $ 1,156,248 =========== ============
5 COPLEY PENSION PROPERTIES VI A REAL ESTATE LIMITED PARTNERSHIP;
Net income per limited partnership unit $ 1.15 $ 23.46 ========== ======== Cash distributions per limited partnership unit $ 24.49 $ 79.49 ========== ======== Number of limited partnership units outstanding during the period 48,788 48,788 ========== ========
(See accompanying notes to unaudited financial statements) 6 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP SUMMARIZED STATEMENT OF CASH FLOWS (Unaudited)
Six Months Ended June 30, 2001 ---------------- Net cash provided by operating activities $ 146,392 ------------ Cash flows from investing activities: Deferred disposition fee 94,703 Investment in joint venture (44,995) Net proceeds from sale 2,807,040 ------------ Net cash provided by investing activities 2,856,748 ------------ Cash flows from financing activity: Distributions to partners (3,878,158) ------------ Net cash used in financing activities (3,878,158) ------------ Net decrease in cash and cash equivalents (875,018) Cash and cash equivalents: Beginning of period 2,053,663 ------------ End of period $ 1,178,645 ============
(See accompanying notes to unaudited financial statements) 7 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Unaudited) In the opinion of management, the accompanying unaudited financial statements contain all adjustments necessary to present fairly the Partnership's financial position as of June 30, 2002 and December 31, 2001 and its changes of net assets in liquidation and its operations for the three and six month periods ended June 30, 2002 and 2001, respectively, and its cash flows for the six months ended June 30, 2001. These adjustments are of a normal recurring nature. See notes to financial statements included in the Partnership's 2001 Annual Report on Form 10-K for additional information relating to the Partnership's financial statements. Note 1 - Organization and Business - ---------------------------------- Copley Pension Properties VI; A Real Estate Limited Partnership (the "Partnership") is a Massachusetts limited partnership organized for the purpose of investing primarily in newly constructed and existing income producing real properties. It primarily serves as an investment for qualified pension and profit sharing plans and other organizations intended to be exempt from federal income tax. The Partnership commenced operations in July 1988 and had disposed of all of its real estate investments as of December 31, 2001. The Partnership sold its last remaining asset in August 2001. On December 31, 2001, the Partnership adopted a plan of liquidation and intends to liquidate and dissolve in 2002. In connection with its adoption of a plan of liquidation on December 31, 2001, the Partnership also adopted the liquidation basis of accounting which, among other things, requires that assets and liabilities be stated at their estimated net realizable value and that estimated costs of liquidating the Partnership be provided to the extent that they are reasonably determinable. Note 2 - Investment in Joint Venture - ------------------------------------ On February 26, 2001, the Prentiss Copystar joint venture investment in which the Partnership and an affiliate were entitled to 69% and 31%, respectively, of the operating activity, sold its property to an unaffiliated third party for gross proceeds of $4,575,000, of which the Partnership's share was $3,156,750. The Partnership received its 69% share of the net proceeds, $3,049,698 after closing costs, and recognized a gain of $953,693 ($19.35 per Limited Partnership Unit) on the sale. A disposition fee of $94,703 was accrued but not paid to AEW Real Estate Advisors, Inc. In accordance with the Partnership agreement, a portion of this previously accrued fee was reversed during the third quarter of 2001, decreasing the fee to $44,826. On March 29, 2001, the Partnership made a capital distribution of $2,683,340 ($55.00 per Limited Partnership Unit) from the proceeds of the sale. 8 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Summarized Financial Information The following summarized financial information is presented in the aggregate for the Prentiss Copystar joint venture: Assets and Liabilities ----------------------
June 30, 2002 December 31, 2001 --------------- ------------------- Assets Other $ - $ 9,500 --------- --------- - 9,500 Liabilities - 9,500 --------- --------- Net assets $ - $ 0 ========= =========
Results of Operations ---------------------
Six Months Ended June 30, 2002 2001 --------- --------- Revenue: Rental income $ - $ 87,305 --------- --------- - 87,305 --------- --------- Expenses: Operating expenses - 51,177 Depreciation and amortization - 12,151 --------- --------- - 63,328 --------- --------- Net income $ - $ 23,977 ========= =========
Liabilities and expenses exclude amounts owed and attributable to the Partnership and its affiliate on behalf of their various financing arrangements with the joint venture. 9 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Note 3 - Property - ----------------- On August 8, 2001, the Partnership sold its Wilmington Industrial investment to an unaffiliated third party for gross proceeds of $8,217,781. The Partnership received net proceeds of $7,914,742 and recognized a gain on the sale of $3,702,297 ($75.13 per Unit). On September 28, 2001, the Partnership made a capital distribution of $7,025,472 ($144.00 per Unit) from the proceeds of the sale. The following is the balance of Wilmington Industrial's net operating assets, which consist of working capital:
June 30, 2002 December 31, 2001 --------------- ----------------- Net operating assets $ 16,369 $ 41,979 -------- -------- $ 16,369 $ 41,979 ======== ========
Note 4 - Accrued expenses for liquidation - ----------------------------------------- Accrued expenses for liquidation as of June 30, 2002 include estimates of costs to be incurred in carrying out the dissolution and liquidation of the Partnership. These costs include estimates of legal fees, accounting fees, tax preparation and filing fees and other professional services. During the three and six month periods ended June 30, 2002, the Partnership incurred $18,468 and $23,221, respectively, of such expenses. The actual costs could vary from the related provisions due to the uncertainty related to the length of time required to complete the liquidation and dissolution of the Partnership. The accrued expenses do not take into consideration possible litigation arising from the customary representations and warranties made as part of each sale. Such costs are unknown and are not estimable at this time. 10 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Management's Discussion and Analysis of Financial Condition and - --------------------------------------------------------------- Results of Operations - --------------------- Accounting Policies - ------------------- Revenue recognition The Partnership recognizes rental revenue on a straight-line basis over the lease terms. The Partnership accounts for its investments in joint ventures using the equity method of accounting. Under the equity method of accounting, the net equity investment of the Partnership is reflected on the balance sheets, and the Partnership's share of net income or loss from the joint ventures is included in the statements of operations. The Partnership records real estate sales at the time a sale is consummated. A sale is consummated when the parties are bound by the terms of a contract, all consideration has been exchanged, all conditions precedent to closing have been met, and title has passed from seller to buyer. Liquidation Basis of Accounting The Partnership adopted a plan of liquidation on December 31, 2001, and, as a result, the Partnership also adopted the liquidation basis of accounting which, among other things, requires that assets and liabilities be stated at their estimated net realizable value and that estimated costs of liquidating the Partnership be provided to the extent that they are reasonably determinable. Accrued expenses for liquidation as of December 31, 2001 include estimates of costs to be incurred in carrying out the dissolution and liquidation of the Partnership. These costs include estimates of legal fees, accounting fees, tax preparation and filing fees and other professional services. The actual costs could vary from the related provisions due to the uncertainty related to the length of time required to complete the liquidation and dissolution of the Partnership. The accrued expenses do not take into consideration possible litigation arising from the customary representations and warranties made as part of each sale. Such costs, if any, are unknown and are not estimable at this time. Similarly, there can be no assurance as to the timing of a distribution of the Partnership's assets or the amount of assets that will be distributed to the Partnership's Unit holders. Liquidity and Capital Resources The Partnership completed its offering of units of limited partnership interest on December 31, 1988. A total of 48,788 units were sold. The Partnership received proceeds of $43,472,858, net of selling commissions and other offering costs, which have been used for investment in real estate and for the payment of related acquisition costs, or retained as working capital reserves. The Partnership made seven real estate investments; one investment was sold in each of 1990, 1994 and 1997 and two investments were sold both in 1998 and 2001. Through June 30, 2002, capital of $48,788,000 ($1,000 per limited partnership unit) has been returned to the limited partners; $45,903,165 as a result of sales and $2,884,835, as a result of a discretionary reduction of original working capital previously held in reserves. 11 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP At June 30, 2002, the Partnership had $946,204 in cash and cash equivalents, which is being retained primarily as a reserve in connection with the liquidation of the Partnership. There have been no operating cash distributions made since the fourth quarter of 1999 due to Prentiss Copystar's vacancy from September 1999 through August 2000 and it's subsequent sale in February 2001 as well as insufficient cash flow from Wilmington Industrial as a result of property level obligations which reduced its cash flow to the Partnership and its subsequent sale in August 2001. However, a capital distribution of original working capital previously held in reserves was made on April 26, 2001 in the amount of $24.49 per Unit and a distribution of operational cash previously held in reserves was made on July 26, 2001 in the amount of $6.40 per Unit. Results of Operations - --------------------- Form of Real Estate Investments The Wilmington Industrial investment was a wholly-owned property and was sold on August 8, 2001. The Prentiss Copystar real estate investment was structured as a joint venture. Prentiss Copystar was sold on February 26, 2001. Operating Factors As mentioned above, the Prentiss Copystar joint venture investment in which the Partnership and an affiliate were entitled to 69% and 31% of the operating activity, respectively, sold its property on February 26, 2001. The Partnership recognized its 69% share of the gain of $953,693. At the time of the sale, Prentiss Copystar was 100% leased. As mentioned above, the Wilmington Industrial property was sold on August 8, 2001 and the Partnership recognized a gain of $3,702,297. At the time of sale the property was 100% leased. Investment Results The investment results for the three and six month periods ended June 30, 2002 and 2001 are not comparable due to the sale of the Partnership's last two remaining properties in 2001, as discussed above. Portfolio Expenses The Partnership management fee is 9% of distributable cash flow from operations after any increase or decrease in working capital reserves as determined by the managing general partner. The Partnership incurred management fees during the three and six months ended June 30, 2001 related to the distribution of operational cash previously held in reserves, as discussed above. No management fees have been incurred during 2002. 12 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP General and administrative expenses consist primarily of real estate appraisal, printing, legal, accounting and investor servicing fees. General and administrative expenses for the three and six month periods ended June 30, 2001 were $40,238 and 76,376, respectively. Costs to dissolve and liquidate the Partnership include legal fees, accounting fees, tax preparation fees, filing fees and other professional services. During the three and six month periods ended June 30, 2002, the Partnership incurred $18,468 and $23,221, respectively, of such expenses. 13 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP FORM 10-Q FOR QUARTER ENDED JUNE 30, 2002 PART II OTHER INFORMATION Item 6. Reports on Form 8-K Reports on Form 8-K: No Current Reports on Form 8-K were filed during the quarter ended June 30, 2002. 14 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. COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP (Registrant) August 13, 2002 /s/ Alison L. Husid ------------------------------- Alison L. Husid President, Chief Executive Officer And Director of Managing General Partner, Sixth Copley Corp. August 13, 2002 /s/ Jonathan Martin -------------------------------- Jonathan Martin Principal Financial and Accounting Officer of Managing General Partner, Sixth Copley Corp. 15 STATEMENT PURSUANT TO 18 U.S.C.SS.1350 Pursuant to 18 U.S.C. ss.1350, each of the undersigned certifies that this Quarterly Report on Form 10-Q for the period ended June 30, 2002 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in this report fairly presents, in all material respects, the financial condition of Copley Pension Properties VI at the end of such period and the results of operations of Copley Pension Properties VI for such period. Dated: August 13, 2002 /s/Alison L. Husid ----------------------------------------- President and Chief Executive Officer of the Managing General Partner, Sixth Copley Corp. Dated: August 13, 2002 /s/Jonathan Martin ----------------------------------------- Treasurer and Chief Financial Officer of the Managing General Partner, Sixth Copley Corp. 16 -----END PRIVACY-ENHANCED MESSAGE-----