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FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2008 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ___________ Commission file number 0-2670 60 EAST 42ND ST. ASSOCIATES L.L.C. (Exact name of Registrant as specified in its charter) A New York Limited Liability
Company 13-6077181 (State or other jurisdiction
of (I.R.S. Employer incorporation or
organization) Identification No.) 60 East 42nd Street, New York, New York 10165 (Address of principal executive offices) (Zip Code) (212) 687-8700 (Registrant's telephone number, including area code) N/A (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 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 [ ]. Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes [ ] No [ X ] . Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. Large Accelerated Filer [ ] Accelerated Filer [ ] Non-Accelerated Filer [ ] Smaller Reporting Company [X] PART I. FINANCIAL INFORMATION Item 1. Financial Statements. 60 East 42nd St. Associates L.L.C. (A Limited Liability Company) Condensed Balance Sheets (Unaudited) Assets: June 30, 2008 December 31, 2007 Real estate: Buildings $16,960,000 $16,960,000 Less, accumulated depreciation 16,960,000 16,960,000 0 0 Building improvements and equipment 65,986,655 65,986,655 Less, accumulated depreciation 7,964,507 7,139,176 58,022,148 58,847,479 Land 7,240,000 7,240,000 Total real estate 65,262,148 66,087,479 Cash in banks and money market fund 106,730 273,665 Receivable from participants re: NYS estimated
tax 118,139 - Restricted cash for payment of building
improvement costs 2,724,137 6,547,678 Leasing commissions 4,109,821 4,109,821 Less, accumulated amortization 1,166,138 901,832 2,943,683 3,207,989 Mortgage refinancing costs 2,111,087 2,111,087 Less, accumulated amortization 756,008 650,454 1,355,079 1,460,633 Total assets $72,509,916 $77,577,444 Liabilities and Members' Deficiency: Liabilities: First mortgage payable $82,492,333 $83,323,818 Payable to lessee 473,331 1,328,760 Building improvement costs payable 1,477,269 4,492,906 Accrued mortgage interest and other expenses 367,091 371,713 Total liabilities 84,810,024 89,517,197 Commitments and contingencies - - Members' deficiency (12,300,108) (11,939,753) Total liabilities and members' deficiency $72,509,916 $77,577,444 See notes to the condensed financial
statements. 60 East 42nd St. Associates L.L.C. (A Limited Liability Company) Condensed Statements of Operations (Unaudited) For the Three Months For the Six Months Ended June 30, Ended June 30, 2008 2007 2008 2007 Revenues: Basic rent income, from a related party $1,510,914 $ 903,826 $3,001,339 $1,788,410 Advance of additional rent income, from a related
party 263,450 263,450 526,900 526,900 Total rent income 1,774,364 1,167,276 3,528,239 2,315,310 Dividend income 18,601 50,024 57,690 119,290 Miscellaneous income 0 0 0 1,500 Total revenues 1,792,965 1,217,300 3,585,929 2,436,100 Expenses: Interest on mortgage 1,103,141 947,850 2,211,844 1,895,700 Supervisory services, to a related party
7,845 7,845 15,690 15,690 Depreciation of building improvements and
equipment 412,665 387,102 825,330 772,075 Amortization of leasing commissions 132,881 95,348 264,306 179,295 Amortization of mortgage refinancing costs 52,777 52,777 105,554 105,554 Fees and miscellaneous 0 2,751 350 3,251 Total expenses 1,709,309 1,493,673 3,423,074 2,971,565 Net Income (Loss) $83,656 $(276,373) $162,855 $(535,465) Income (Loss) per $10,000 participation unit, based on 700 participation units outstanding during each period Distributions per $10,000 participation unit consisted of the following: Income Return of capital Total distributions 254.21 $373.72 373.72 $373.72 514.79 $747.44 747.44 $747.44 At June 30, 2008 and 2007, there were
$7,000,000 of Participation units outstanding. See notes to the condensed financial
statements. 60 East 42nd St. Associates L.L.C. (A Limited Liability Company) Statement of Members' Deficiency (Unaudited) For the Six Months Ended Ended June 30, 2008 December 31, 2007 Members' deficiency: January 1, 2008 $(11,939,753) January 1, 2007 $(10,734,058) Add net income: January 1, 2008 through June 30, 2008 162,855 - January 1, 2007 through December 31, 2007 - 8,386,847 (11,776,898) (2,347,211) Less distributions: Monthly distributions: January 1, 2008 through June 30, 2008 523,210 - January 1, 2007 through December 31, 2007 - 1,046,420 Additional distribution on November 30,
2007 - 8,546,122 Total distributions 523,210 9,592,542 Members' deficiency: June 30, 2008 $(12,300,108) December 31, 2007 $(11,939,753) See notes to the condensed financial
statements. 60 East 42nd St. Associates L.L.C. (A Limited Liability Company) Condensed Statements of Cash Flows (Unaudited) For the Six Months Ended June 30, 2008 For the Six Months Ended June 30, 2007 Cash flows from operating activities: Net income (loss) $162,855 $(535,465) Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities: Depreciation of building improvements and
equipment 825,330 772,075 Amortization of leasing commissions 264,306 179,295 Amortization of mortgage refinancing costs 105,554 105,554 Change in leasing commissions - (687,888) Change in accrued mortgage interest and other
expenses (4,622) 22,111 Net cash provided by (used in) operating
activities 1,353,423 (144,318) Cash flows from investing activities: Purchase of building improvements and
equipment (3,015,636) (3,755,839) Change in restricted cash segregated for payment
of building improvement costs 3,823,541 (1,283,451) Change in receivable from participants (118,139) (103,805) Net cash provided by (used in) investing
activities 689,766 (5,143,095) Cash flows from financing activities: Proceeds from refinancing - 5,000,000 Increase (decrease) in due to lessee (855,429) 693,247 Repayment of first mortgage payable (831,485) - Distributions to participants (523,210) (523,210) Net cash provided by (used in) financing
activities (2,210,124) 5,170,037 Net decrease in cash and cash equivalents (166,935) (117,376) Cash and cash equivalents, beginning of
period 273,665 224,526 Cash and cash equivalents, end of period $106,730 $107,150 Cash paid for: Interest $2,215,544 $1,873,450 See notes to the condensed financial
statements. Notes to Condensed Financial Statements (Unaudited) Note A Interim Period Reporting In the opinion of management, the
accompanying unaudited condensed financial statements of 60 East 42nd St. Associates L.L.C. (the "Registrant") reflect
all adjustments, consisting of normal recurring accruals, necessary to present
fairly the financial position of Registrant as of June 30, 2008 and its results
of operations for the three and six months ended June 30, 2008 and 2007 and cash
flows for the six months ended June 30, 2008 and 2007. Information included in
the condensed balance sheet as of December 31, 2007 has been derived from the
audited balance sheet included in Registrant's Form 10-K for the year ended
December 31, 2007 (the "10-K") previously filed with the Securities and Exchange
Commission (the "SEC"). Pursuant to rules and regulations of the SEC, certain
information and disclosures normally included in financial statements prepared
in accordance with accounting principles generally accepted in the United States
of America have been condensed or omitted from these financial statements unless
significant changes have taken place since the end of the most recent fiscal
year. Accordingly, these unaudited condensed financial statements should be read
in conjunction with the financial statements and notes thereto and the other
information contained in the 10-K. The results of operations for the six months
ended June 30, 2008 are not necessarily indicative of the results to be expected
for the full year. Note B Organization Registrant was originally organized as a
partnership on September 25, 1958. On October 1, 1958, Registrant acquired fee
title to the Lincoln Building (the "Building") and the land thereunder, located
at 60 East 42nd Street, New York, New York (the "Property"). On November 28,
2001, Registrant converted to a limited liability company under New York law and
is now known as 60 East 42nd St. Associates L.L.C. The conversion did not change
any aspect of the assets and operations of Registrant other than to protect its
participants from liability to third parties. Registrant's members ("Members")
are Peter L. Malkin, Anthony E. Malkin and Thomas N. Keltner, Jr. each of whom
also acts as an agent (collectively, the "Agents"), for holders of
participations ("Participations") in his respective member interest in
Registrant (the "Participants"). The members in Registrant hold senior positions
at Wien & Malkin LLC ("Wien & Malkin" or the "Supervisor"), 60 East 42nd
Street, New York, New York, which provides supervisory and other services to
Registrant and to Lessee. See Note E below. Note C Lease Registrant does not operate the Property.
Registrant leases the Property to Lincoln Building Associates L.L.C. ("Lessee")
pursuant to an operating lease (the "Lease") as modified, which is currently set
to expire on September 30, 2033. Lessee is a New York limited liability company
whose members consist of, among others, entities for the benefit of members of
Peter L. Malkin's family. The Lease, as modified, provides that
Lessee is required to pay rent to Registrant as follows: (i) annual basic rent ("Basic Rent") equal
to the sum of $24,000 for supervisory services payable to Supervisor plus the
constant annual mortgage charges on all mortgages reduced by dividends earned on
funds borrowed for the improvement program. In the event of a mortgage
refinancing, unless there is an increase in the mortgage balance, the annual
basic rent will be modified and will be equal to the sum of $24,000 plus an
amount equal to the revised mortgage charges. In the event that such mortgage
refinancing results in an increase in the amount of outstanding principal
balance of the mortgage, the basic rent shall be equal to $24,000 plus an amount
equal to the product of the new debt service percentage rate under the
refinanced mortgage multiplied by the principal balance of the mortgage
immediately prior to the refinancing. In accordance with the Eighth Lease
Modification Agreement dated November 29, 2004, Basic Rent was increased to
cover debt service on a $84,000,000 first mortgage. See Note D. Basic Rent will
be increased or decreased upon the refinancing of the mortgage provided that the
aggregate principal balance of all mortgages now or hereafter placed on the
Property does not exceed $84,000,000 plus refinancing costs. (ii) additional rent ("Additional Rent")
equal to, on an annual basis, the lesser of (x) Lessee's net operating income
(as defined) for the lease year ending September 30 or (y) $1,053,800 ($87,817
per month) and further additional rent ("Further Additional Rent") equal to 50%
of any remaining balance of Lessee's net operating income for such lease year.
(Lessee has no obligation to make any payment of Additional Rent or Further
Additional Rent until after Lessee has recouped any cumulative operating loss
accruing from and after September 30, 1977. There is currently no accumulated
operating loss against which to offset payment of Additional Rent or Further
Additional Rent.) The Lease also requires an advance against
Additional Rent equal to, on an annual basis, the lesser of (x) Lessee's net
operating income for the preceding lease year or (y) $1,053,800, which, in the
latter amount, will permit basic distributions to Participants at an annual rate
of approximately 14.95% per annum on their remaining cash investment in
Registrant; provided, however, if such advances exceed Lessee's net operating
income for any lease year, advances otherwise required during the subsequent
lease year shall be reduced by an amount equal to such excess until Lessee shall
have recovered, through retention of net operating income, the full amount of
such excess. After the Participants have received distributions equal to a
return of 14% per annum, $7,380 is paid to Supervisor from the advances against
Additional Rent. Lessee is required to make an annual
payment to Registrant of Further Additional Rent, which, as explained above, is
the amount representing 50% of the remaining net operating income reported by
Lessee for the lease year ending September 30th after deducting the advance
against Additional Rent. The Lease requires that the report be delivered by
Lessee to Registrant annually within 60 days after the end of each such lease
year. Since it is not practicable to estimate Further Additional Rent for the
lease year ending on the ensuing September 30th
which would be allocable to the first nine months of the lease year until
Lessee, pursuant to the Lease, renders to Registrant a report on the operation
of the Property, Registrant recognizes Further Additional Rent when earned from
the Lessee at the close of the lease year ending September 30th. For the lease year ended September 30,
2007, Lessee reported net operating income of $20,599,567. Lessee paid advances
against Additional Rent of $1,053,800 for that lease year prior to September 30,
2007 and Further Additional Rent of $9,772,882 subsequent to September 30, 2007.
The Further Additional Rent of $9,772,882 represents 50% of the excess of the
Lessee's net operating income of $20,599,567 over $1,053,800, after deducting
$700 for annual New York State limited liability company filing fees, $200,000
added as a cash reserve for contingencies (there were no related charges to
expenses), $76,491 of costs that were incurred in response to an unaffiliated
third party tender offer and $949,569 as an additional required payment to
Supervisor (See Note E), the balance of $8,546,122 was distributed by Registrant
to the Participants on November 30, 2007. As a result of its revenue recognition
policy, rental income for the year ending December 31st includes the advances of Additional Rent income
received from October 1st to December 31st but does not include any portion of Further
Additional Rent based on the Lessee's operations during that period. Note D First Mortgage Payable On November 29, 2004, a new first mortgage
("Mortgage") was placed on the Property in the amount of $84,000,000 with
Prudential Insurance Company of America to provide financing for the improvement
program described below. At closing, $49,000,000 was drawn to pay off the former
first mortgage with Morgan Guaranty Trust Company in the amount of $12,020,814
and the second mortgage in the amount of $27,979,186 with Emigrant Savings Bank.
The remaining $35,000,000 available under the Mortgage was drawn on various
dates through July 5, 2007. The proceeds of $49,000,000 drawn at closing and all
subsequent draws have been or will be used to pay for refinancing costs and
capital improvements as needed. The initial draw of $49,000,000 and all
subsequent draws required constant equal monthly payments of interest only, at
the rate of 5.34% per annum, until July 5, 2007. Commencing August 5, 2007,
Registrant is required to make equal monthly payments of $507,838 applied to
interest and then principal calculated on a 25-year amortization schedule. The
entire $84,000,000 has been drawn on the Mortgage as of June 30, 2008 and
matures on November 5, 2014 at which time the principal balance will be
$69,600,350. The Mortgage may be prepaid at any time,
in whole only, upon payment of a prepayment penalty based on a yield maintenance
formula. There is no prepayment penalty if the Mortgage is paid in full during
the last 60 days of the term. Mortgage refinancing costs of $2,111,087
were capitalized by Registrant and are being amortized ratably over the term of
the Mortgage. In 1999, the Participants of Registrant
and the members in Lessee consented to a building improvements program (the
"Program") estimated to cost approximately $22,800,000. In 2000, the
Participants of Registrant and members in Lessee approved an increase in the
Program from $22,800,000 to approximately $28,000,000 under substantially the
same conditions as had previously been approved. To induce the Lessee to approve
the Program, Registrant agreed to grant to the Lessee, upon completion of the
Program, the right to further extensions of the Lease to 2083. The Program was
further increased in 2004 to up to $100,000,000. Such increase would extend the
lease beyond 2083, based on the net present benefit to Registrant of the
improvements made. The granting of such Lease extension rights upon completion
of the Program is expected to trigger a New York State Transfer Tax under
current tax rules, which will be paid from mortgage proceeds and/or the Lessee's
operating cash flow. As of June 30, 2008, the Registrant had incurred or accrued
costs related to the Program of approximately $64,400,000 and estimates that the
Program will be completed by 2009 and that costs upon completion will be
approximately $85,287,000. The Participants of Registrant and the members in
Lessee have approved increased refinancing of $16,000,000 from the total of
$84,000,000 provided by the Mortgage to up to $100,000,000. The balance of the
costs of the Program will be financed primarily by the $1,246,868 of restricted
cash in excess of building costs payable as of June 30, 2008 and the $16,000,000
of additional financing previously approved, assuming such financing is
available.
$119.51
$(394.82)
$232.65
$(764.95)
$119.51
$ 0
$232.65
$ 0
For the Year
Registrant pays Supervisor for supervisory services and disbursements. Basic fees for supervisory services are $24,000 per annum, payable in equal monthly installments.
The supervisory services provided to Registrant by Supervisor include, but are not limited to, maintaining all of its entity and Participant records, performing physical inspections of the Building, providing or coordinating certain counsel services to Registrant, reviewing insurance coverage and conducting annual supervisory review meetings, receipt of monthly rent from Lessee, payment of monthly and additional distributions to the Participants, payment of all other disbursements, confirmation of the payment of real estate taxes, active review of financial statements submitted to Registrant by Lessee and financial statements audited by and tax information prepared by Registrant's independent registered public accounting firm, and distribution of related materials to the Participants. Supervisor also prepares quarterly, annual and other periodic filings with the SEC and applicable state authorities.
Registrant pays Supervisor for other services at hourly rates.
No remuneration was paid by Registrant during the six-month period ended June 30, 2008 to any of the Members as such.
Supervisor also receives a payment ("Additional Payment") equal to 10% of all distributions to Participants in Registrant in any year in excess of the amount representing a return to them at the rate of 14% per annum on their remaining cash investment in Registrant (which remaining cash investment at June 30, 2008 was equal to the Participants' original cash investment of $7,000,000). For tax purposes, such additional payment is recognized as a profits interest, and the Supervisor is treated as a partner, all without modifying each Participant's distributive share of reportable income and cash distributions. Supervisor receives $7,380 a year as an advance against the Additional Payment, which Registrant expenses monthly.
Reference is made to Note C above for a description of the terms of the Lease between Registrant and Lessee. As of June 30, 2008, Peter L. Malkin owned a member interest in Lessee. The respective interests of the Members in Registrant and Lessee arise solely from ownership of their respective Participations in Registrant and, in the case of Peter L. Malkin, his individual ownership of a member interest in Lessee. The Members as such receive no extra or special benefit not shared on a pro rata basis with all other Participants in Registrant or members in Lessee. However, all of the Members hold senior positions at Supervisor (which supervises Registrant and Lessee) and, by reason of their positions at Supervisor, may receive income attributable to supervisory or other remuneration paid to Supervisor by Registrant and Lessee.
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
Forward Looking Statements
Readers of this discussion are advised that the discussion should be read in conjunction with the financial statements of Registrant (including related notes thereto) appearing elsewhere in this Form 10-Q. Certain statements in this discussion may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect Registrant's current expectations regarding future results of operations, economic performance, financial condition and achievements of Registrant, and do not relate strictly to historical or current facts. Registrant has tried, wherever possible, to identify these forward-looking statements by using words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning.
Although Registrant believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties, which may cause the actual results to differ materially from those projected. Such factors include, but are not limited to, the following: general economic and business conditions, which will, among other things, affect demand for rental space, the availability of prospective tenants, lease rents and the availability of financing; adverse changes in Registrant's real estate market, including, among other things, competition with other real estate owners, risks of real estate development and acquisitions; governmental actions and initiatives; and environmental/safety requirements.
Financial Condition and Results of Operations
Registrant was organized for the purpose of acquiring the Property subject to an operating lease held by Lessee. Registrant is required to pay, from Basic Rent under the Lease, mortgage charges and amounts for supervisory services. Registrant is required to pay from Additional Rent and Further Additional Rent additional payments to Supervisor and then to distribute the balance of such Additional Rent and Further Additional Rent to the Participants. See Note C to the condensed financial statements herein. Under the Lease, Lessee has assumed sole responsibility for the condition, operation, repair, maintenance and management of the Property. Registrant is not required to maintain substantial reserves or otherwise maintain liquid assets to defray any operating expenses of the Property.
Registrant does not pay dividends. During the six month period ended June 30, 2008, Registrant made regular monthly distributions of $124.57 for each $10,000 Participation ($1,494.89 per annum for each $10,000 Participation). There are no restrictions on Registrant's present or future ability to make distributions; however, the amount of such distributions, particularly distributions of Additional Rent and Further Additional Rent, depends on the ability of Lessee to make payments of Basic Rent, Additional Rent and Further Additional Rent to Registrant. Registrant expects to make distributions so long as it receives the payments provided for under the Lease.
On November 30, 2007, Registrant made an additional distribution of $12,209 for each $10,000 Participation. Such distribution is derived from Further Additional Rent paid by the Lessee subsequent to September 30, 2007 in accordance with the terms of the Lease after deducting the Additional Payment to Supervisor, establishment of a cash reserve for contingencies, annual New York State Limited Liability Company filing fee and costs incurred in response to an unaffiliated third party tender offer. See Notes C and E to the condensed financial statements herein.
Registrant's results of operations are affected primarily by the amount of rent payable to it under the Lease. The amount of Additional Rent and Further Additional Rent payable to Registrant is affected by the New York City economy and real estate rental market, which is difficult for management to forecast. The following summarizes, with respect to the current period and the corresponding period of the previous year, the material factors regarding Registrant's results of operations for such periods:
Total revenues increased for the three and six-month periods ended June 30, 2008 as compared with the corresponding periods of the prior year. Such increase is the result of an increase in Basic Rent income to cover an increase in debt service and a decrease in dividend income resulting from the short-term investment of proceeds from the additional draws on the mortgage for the three and six-month periods ended June 30, 2008 as compared with the corresponding periods of the prior year.
Total expenses increased for the three and six-month periods ended June 30, 2008 as compared with the corresponding periods of the prior year. Such increase was primarily attributable to an increase in interest on the Mortgage payable by Registrant, an increase in depreciation of building improvements and equipment as a result primarily of the improvement program and amortization of leasing commissions for the three and six-month periods ended June 30, 2008 as compared with the corresponding periods of the prior year.
Liquidity and Capital Resources
Registrant's liquidity has not significantly changed at June 30, 2008 as compared with June 30, 2007. Costs relating to the improvement program were funded from a portion of proceeds of the Mortgage of $84,000,000. Approximately $2,724,000 of mortgage proceeds is available for building improvements and is reflected as restricted cash at June 30, 2008. The Participants of Registrant and the members in Lessee have approved increased financing of $16,000,000 from the total of $84,000,000 provided by the Mortgage to up to $100,000,000. Registrant may from time to time set cash aside for contingencies. Recent adverse developments in credit and investment markets have impaired liquidity in general and may negatively impact Registrant and/or space tenants at the Building. Any such impact should be ameliorated by the fact that (a) each of Registrant and its Lessee has very low debt in relation to asset value, (b) the maturity of Registrant's existing and planned debt will not occur within the next 36 months, and (c) the Building's rental revenue is derived from a substantial number of tenants in diverse businesses with lease termination dates spread over numerous years.
Amortization payments due under the Mortgage commenced August 5, 2007, calculated on a 25-year amortization schedule. The Mortgage matures on November 5, 2014 at which time the principal balance will be $69,600,350. Registrant does not maintain any reserve to cover the payments of such mortgage indebtedness at maturity. Therefore, repayment of the Mortgage will depend on Registrant's ability to arrange a refinancing. Assuming that the Property continues to generate an annual net profit in future years comparable to that in past years, and assuming further that historic real estate trends continue in the geographic area in which the Property is located, Registrant anticipates that the value of the Property would be in excess of the amount of the Mortgage balance at maturity.
Registrant anticipates that funds for working capital for the Property will be provided by rental payments received from the Lessee and, to the extent necessary, from additional capital investment by the members in Lessee and/or external financing. However, as noted above, Registrant has no requirement to maintain reserves to defray any operating expenses of the Property.
Registrant has the following contractual obligations:
Payments due by period |
|
|
Less than |
|
|
More than |
Long-Term Debt Obligations |
$82,492,333 |
$1,730,924 |
$3,751,214 |
$4,173,031 |
$72,837,164 |
Interest Obligations |
26,211,556 |
4,363,134 |
8,436,901 |
8,015,084 |
5,396,437 |
Capital Lease Obligations |
0 |
0 |
0 |
0 |
0 |
Purchase Obligations |
0 |
0 |
0 |
0 | |
Other Long-Term Liabilities Reflected on the Registrant's Balance Sheet |
0 |
0 |
0 |
0 |
0 |
Total |
$108,703,889 |
$6,094,058 |
$12,188,115 |
$12,188,115 |
$78,233,601 |
Inflation
Registrant believes that there has been no material change in the impact of inflation on its operations since the filing of its report on Form 10-K for the year ended December 31, 2007.
Security Ownership
As of June 30, 2008, the Members in Registrant owned of record and beneficially an aggregate $25,833 of participations in Registrant, representing 0.37% of the currently outstanding Participations therein.
As of June 30, 2008, certain of the Members in Registrant held additional Participations in Registrant as follows:
Peter L. Malkin owned of record as trustee or co-trustee an aggregate of $169,047 of Participations. Peter L. Malkin disclaims any beneficial ownership of such Participations.
Entities for the benefit of members of Peter L. Malkin's family owned of record and beneficially $125,280 of Participations. Peter L. Malkin disclaims any beneficial ownership of such Participations, except that related family trusts or entities are required to complete scheduled payments to him.
Anthony E. Malkin owned of record as co-trustee an aggregate of $25,000 of Participations. Anthony E. Malkin disclaims any beneficial ownership of such Participations.
Thomas N. Keltner, Jr. owned of record as trustee a $2,500 Participation.
Item 4T. Controls and Procedures.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
The property of Registrant was the subject of the following material litigation:Wien & Malkin and Peter L. Malkin, a member in Registrant, were engaged in a proceeding with Lessee's former managing agent, Helmsley-Spear, Inc. commenced in 1997, concerning the management, leasing, and supervision of the property that is subject to the Lease to Lessee. In this connection, certain costs for legal and professional fees and other expenses have been paid by Wien & Malkin and Mr. Malkin. Wien & Malkin and Mr. Malkin have represented that such costs will be recovered only to the extent that (a) a competent tribunal authorizes payment or (b) an investor voluntarily agrees that his or her proportionate share be paid. Accordingly, Registrant's allocable share of such costs is as yet undetermined, and Registrant has not provided for the expense and related liability with respect to such costs in its financial statements. As a result of an August 29, 2006 settlement agreement, which included termination of this proceeding, Registrant will not recognize any gains or losses from this proceeding other than the possible charges for the aforementioned fees and expenses.
Item 6. Exhibits
EXHIBIT INDEX
Number |
Document |
Page* |
3 (a) |
Attached hereto as Exhibit 3 (c) is Registrant's Consent and Operating Agreement dated as of November 28, 2001 as a Limited Liability Company, which incorporates by reference the Registrant's prior Partnership Agreement, dated September 25, 1958, which was filed by letter dated March 31, 1981 (Commission File No. 0-2670) filed as Exhibit No. 1 to Registrant's Registration Statement on Form S-1 as amended (the "Registration Statement"), and is itself incorporated by reference as an exhibit hereto. |
|
3 (c) |
Registrant's Consent and Operating Agreement dated as of November 28, 2001 |
|
3 (d) |
Certificate of Conversion of Registrant to a limited liability company dated November 28, 2001 filed with the New York Secretary of State on December 3, 2001. |
|
24 |
Powers of Attorney dated October 9, 2003, October 22, 2003 and October 23, 2003 between Partners of Registrant and Mark Labell which is filed as Exhibit 24 to Registrant's 10-Q for the quarter ended September 30, 2003 and is incorporated by reference as an exhibit hereto. |
|
31.1 |
Certification of Mark Labell, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
31.2 |
Certification of Mark Labell, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
Number |
EXHIBIT INDEX (cont.) Document |
Page* |
32.1 |
Certification of Mark Labell, Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
32.2 |
Certification of Mark Labell, Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
*Page references are based on sequential
numbering system.
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.
The individual signing this report on behalf of Registrant is Attorney-in-Fact for Registrant and each of the Members in Registrant, pursuant to Powers of Attorney, dated October 9, 2003, October 22, 2003 and October 23, 2003 (collectively, the "Power").
60 EAST 42ND ST. ASSOCIATES L.L.C.
(Registrant)
By: /s/ Mark Labell
Mark Labell, Attorney-in-Fact*
Dated: November 6, 2008
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the undersigned as Attorney-in-Fact for each of the Members in Registrant, pursuant to the Power, on behalf of Registrant on the date indicated.
By: /s/ Mark Labell
Mark Labell, Attorney-in-Fact*
Dated: November 6, 2008
*Mr. Labell supervises accounting functions for Registrant.
Exhibit 31.1
CERTIFICATIONS
I, Mark Labell, certify that:
Date: November 6, 2008
By /s/ Mark Labell
Name: Mark Labell
Title: Senior Vice President, Finance
Wien & Malkin LLC, Supervisor of 60 East 42nd St. Associates L.L.C.
Exhibit 31.2
CERTIFICATIONS
I, Mark Labell, certify that:
Date: November 6, 2008
By /s/ Mark
Labell
Name: Mark Labell
Title:Senior Member of Financial/Accounting Staff
Wien & Malkin LLC, Supervisor of 60 East 42nd St. Associates L.L.C.
Exhibit 32.1
Certification Pursuant to 18 U.S.C., Section 1350 as adopted
Pursuant to Section 906
of Sarbanes - Oxley Act of 2002
The undersigned, Mark Labell, is signing this Chief Executive Officer certification as Senior Vice President, Finance of Wien & Malkin LLC, the supervisor* of 60 East 42nd St. Associates L.L.C. ("Registrant") to certify that:
Dated: November 6, 2008
By /s/ Mark Labell
Mark Labell
Senior Vice President, Finance
Wien & Malkin LLC, Supervisor
*Registrant's organizational documents do not provide for a Chief Executive Officer or other officer with equivalent rights and duties. As described in the Report, Registrant is a limited liability company which is supervised by Wien & Malkin LLC. Accordingly, this Chief Executive Officer certification is being signed by a senior executive of Registrant's supervisor.
Exhibit 32.2
Certification Pursuant to 18 U.S.C., Section 1350 as adopted
Pursuant to Section 906
of Sarbanes - Oxley Act of 2002
The undersigned, Mark Labell, is signing this Chief Financial Officer certification as a senior member of the financial/accounting staff of Wien & Malkin LLC, the supervisor* of 60 East 42nd St. Associates L.L.C. ("Registrant"), to certify that:
Dated: November 6, 2008
By /s/ Mark Labell
Mark Labell
Senior Vice President, Finance
Wien & Malkin LLC, Supervisor
*Registrant's organizational documents do not provide for a Chief Financial Officer or other officer with equivalent rights and duties. As described in the Report, Registrant is a limited liability company which is supervised by Wien & Malkin LLC. Accordingly, this Chief Financial Officer certification is being signed by a senior member of the financial/accounting staff of Registrant's supervisor.
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