-----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, HzlbmnYi2jepJVqzBTPxvGXeBTiEXxlGK/kaR4S1i1FlFVdZXENJrTS1gCvUm473 GJruM9o1ggAW3FI/baV0hg== 0000914317-97-000239.txt : 19970515 0000914317-97-000239.hdr.sgml : 19970515 ACCESSION NUMBER: 0000914317-97-000239 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970514 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: RESURGENCE PROPERTIES INC CENTRAL INDEX KEY: 0000929223 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF NONRESIDENTIAL BUILDINGS [6512] IRS NUMBER: 133757163 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-24740 FILM NUMBER: 97604730 BUSINESS ADDRESS: STREET 1: 411 WEST PUTNAM AVENUE CITY: GREENWICH STATE: CT ZIP: 06830 BUSINESS PHONE: 2148795800 10-Q 1 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1997 Commission file number: 0-24740 RESURGENCE PROPERTIES INC. (Exact name of registrant as specified in its charter) MARYLAND 13-3757163 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) c/o Wexford Management LLC 411 West Putnam Avenue, Greenwich, CT 06830 (Address of principal executive offices) (203) 862-7000 (Registrant's telephone number, including area code) None (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 the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: As of May 1, 1997, there were 10,000,000 shares of Common Stock, $0.01 par value, outstanding. RESURGENCE PROPERTIES INC. FORM 10-Q TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets as of March 31, 1997 and December 31, 1996 Unaudited Consolidated Statements of Operations for the Three Months Ended March 31, 1997 and 1996 Unaudited Consolidated Statement of Shareholders' Equity for the Three Months Ended March 31, 1997 Unaudited Consolidated Statements of Cash Flows for the Three Months Ended March 31, 1997 and 1996 Notes to Unaudited Consolidated Financial Statements Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K SIGNATURES
RESURGENCE PROPERTIES INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share and per share amounts) March 31, December 31, 1997 1996 --------- --------- ASSETS OPERATING REAL ESTATE PROPERTIES: Land .................................................... $ 7,841 $ 7,841 Buildings and improvements .............................. 32,710 32,557 --------- --------- 40,551 40,398 Accumulated depreciation and amortization ............... (3,199) (2,893) --------- --------- Operating real estate properties, net .......... 37,352 37,505 MORTGAGE LOANS ON REAL ESTATE: Non-earning ............................................. -- 3,228 Allowance for possible losses ........................... -- (3,198) --------- --------- Mortgage loans on real estate, net ...................... -- 30 CASH AND CASH EQUIVALENTS ..................................... 28,373 4,378 ACCOUNTS RECEIVABLE (net of allowance for doubtful accounts of $111 and $244) ................. 1,079 1,054 ASSETS HELD FOR SALE .......................................... 26,872 49,387 OTHER ASSETS .................................................. 652 932 --------- --------- TOTAL ASSETS .................................................. $ 94,328 $ 93,286 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY LIABILITIES: Dividends payable ....................................... $ 25,000 $ -- Senior debt ............................................. -- 2,490 Mortgage notes payable .................................. 5,151 5,294 Real estate taxes ....................................... 583 482 Other liabilities ....................................... 702 1,320 --------- --------- Total liabilities .............................. 31,436 9,586 RESURGENCE PROPERTIES INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share and per share amounts)(continued) March 31, December 31, 1997 1996 --------- --------- COMMITMENTS AND CONTINGENCIES REDEEMABLE PREFERRED STOCK .................................... 300 300 SHAREHOLDERS' EQUITY: Common stock, par value $.01; 50,000,000 shares authorized; 10,000,000 shares issued and outstanding 100 100 Paid-in-capital ......................................... 76,045 101,045 Accumulated deficit ..................................... (13,553) (17,745) --------- --------- Total shareholders' equity .................... 62,592 83,400 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY .................... $ 94,328 $ 93,286 ========= ========= See notes to unaudited consolidated financial statements
RESURGENCE PROPERTIES INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except share and per share amounts) For the three months ended March 31, 1997 1996 ------- ------- REVENUES: Minimum rents ........................................... $ 2,703 $ 3,989 Recoveries from tenants ................................. 578 846 Mortgage loan interest .................................. -- 445 Investment income ....................................... 124 95 Net gain from asset dispositions ........................ 3,296 975 Other ................................................... 80 86 ------- ------- Total revenues ................................. 6,781 6,436 ------- ------- EXPENSES: Property operations ..................................... 1,396 1,904 Interest expense ........................................ 109 1,112 Non-income producing assets ............................. 64 382 Management fees ......................................... 448 512 General and administrative .............................. 167 186 Depreciation and amortization ........................... 398 777 Write-downs for impairment of value ..................... -- 1,709 ------- ------- Total expenses ................................. 2,582 6,582 ------- ------- INCOME (LOSS) BEFORE INCOME TAXES AND EXTRAORDINARY GAIN ..................................... 4,199 (146) Income Taxes ............................................ -- -- ------- ------- INCOME (LOSS) BEFORE EXTRAORDINARY GAIN ....................... 4,199 (146) Extraordinary Gain ...................................... -- 114 ------- ------- NET INCOME (LOSS) ............................................. $ 4,199 $ (32) ======= ======= INCOME (LOSS) PER COMMON SHARE (10,000,000 shares outstanding): INCOME (LOSS) BEFORE EXTRAORDINARY GAIN ....................... $ 0.42 $ (0.01) EXTRAORDINARY GAIN ............................................ -- 0.01 ------- ------- NET INCOME .................................................... $ 0.42 $ 0.00 ======= ======= See notes to unaudited consolidated financial statements.
RESURGENCE PROPERTIES INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY For the Three Months Ended March 31, 1997 (Dollars in thousands, except share amounts) COMMON STOCK PAID - IN ACCUMULATED SHARES AMOUNT CAPITAL DEFICIT TOTAL ------ ------ ------- ------- ----- Balance, December 31, 1996 10,000,000 $ 100 $ 101,045 $ (17,745) $ 83,400 Common stock dividends ... -- -- (25,000) -- (25,000) Preferred stock dividends -- -- -- (7) (7) Net income ............... 4,199 4,199 Balance, March 31, 1997 .. 10,000,000 $ 100 $ 76,045 $ (13,553) $ 62,592 ========== =========== ========== ========== ========== See notes to unaudited consolidated financial statements
RESURGENCE PROPERTIES INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) For the Three Months ended March 31, ---------------------- 1997 1996 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) ................................................ $ 4,199 $ (32) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization: Operating real estate properties ........................ 306 714 Other assets ............................................ 92 63 Net gain from asset dispositions ............................ (3,296) (975) Extraordinary gain .......................................... -- (114) Write-down for impairment of value .......................... -- 1,709 Straight-line adjustment for stepped rentals ................ 84 (13) Net changes in operating assets and liabilities ............. (730) (33) -------- -------- Net cash provided by operating activities ............... 655 1,319 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Net proceeds from sales of assets ........................... 25,834 16,930 Net collections on mortgage loans ........................... 299 266 Improvements to operating properties ........................ (153) (634) Acquisitions ................................................ -- (800) -------- -------- Net cash provided by investing activities ............... 25,980 15,762 -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Senior debt repayments, net ................................. (2,490) (10,200) Mortgage loan repayments .................................... (143) (2,432) Preferred stock dividends ................................... (7) (7) Purchase of interest in senior debt ......................... -- (3,822) -------- -------- Net cash used for financing activities .................. (2,640) (16,461) -------- -------- NET INCREASE IN CASH AND CASH EQUIVALENTS ........................ 23,995 620 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ................. 4,378 8,818 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD ....................... $ 28,373 $ 9,438 ======== ======== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid for interest ...................................... $ 128 $ 1,141 ======== ======== See notes to unaudited consolidated financial statements
RESURGENCE PROPERTIES INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share amounts) A. ORGANIZATION AND ACCOUNTING POLICIES Resurgence Properties Inc. and its subsidiaries (the "Company") are engaged in diversified real estate activities. The Company was incorporated on March 25, 1994 and began its operations on April 7, 1994, when the Company succeeded to most of the assets of Liberte Investors ("Liberte") upon consummation of Liberte's bankruptcy plan ("The Plan of Reorganization"). The Company is managed and administered by Wexford Management LLC ("Wexford"). The accompanying financial statements, notes and discussions should be read in conjunction with the consolidated financial statements, related notes and discussions contained in the Company's annual report on Form 10-K for the year ended December 31, 1996. The interim financial information contained herein is unaudited; however, in the opinion of management, all adjustments (consisting only of normal recurring adjustments, other than write-downs for impairment of value) necessary for the fair presentation of such financial information have been included. The December 31, 1996 year-end balance sheet data presented herein was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles. The results for the interim period are not necessarily indicative of the results to be expected for the year ending December 31, 1997. The Company has approximately $15.3 million of net operating loss carry-forwards ("NOL") available for U.S. income tax purposes expiring in years through 2011. The Company has provided a valuation allowance to offset the full amount of the net deferred tax assets arising from book and tax differences including those from the NOL's. The Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, "Earnings per Share" in February, 1997. This pronouncement establishes standards for computing and presenting earnings per share, and is effective for the Company's 1997 year-end financial statements. The Company's management has determined that this standard will have no impact on the Company's computation or presentation of net income per common share. B. MORTGAGE LOANS ON REAL ESTATE In February 1997, the Company entered into a settlement agreement on the Summerhill Del Ray mortgage loan whereby the Company received $300 in cash and a $100 note due in June 1997 in complete satisfaction of the mortgage loan. The settlement resulted in a net gain of approximately $268. C. ASSETS HELD FOR SALE For the quarter ended March 31, 1997, the Company sold Abco Plaza, Bayshore Club Apartments, Riverbend Shopping Center, 1025 Vermont Avenue and various land assets for net proceeds of approximately $6,539, $3,843, $620, $12,495 and $2,337, respectively. These sales resulted in a net gain of $3,028, after deducting closing costs. D. DIVIDENDS PAYABLE On March 18, 1997, the Board of Directors declared a special dividend of $2.50 per Common Share payable on April 14, 1997 to shareholders of record as of March 28, 1997. E. SENIOR DEBT In January 1997, the Company prepaid the outstanding balance of its Senior Debt, including accrued interest, obtained lien releases on all of its collateralized assets and terminated the Secured Credit Agreement. In February 1996, the Company purchased a participating interest in the Senior Debt in the principal amount of $3,936 for $3,822 and recognized an extraordinary gain of $114. F. SUBSEQUENT EVENTS On April 28, 1997, the Board of Directors approved a plan of complete liquidation and dissolution of the Company (the "Plan") for submission to shareholders for their approval at the annual shareholders meeting which is expected to be held during the third quarter of 1997. The effective date of the Plan will be upon the affirmative vote of a majority of the Company's shareholders. Among the key features of the Plan are: (1) the cessation of all business activities, other than those in furtherance of the Plan; (2) the sale or disposition of all of the Company's assets; (3) the satisfaction of all outstanding liabilities; (4) the payment of liquidating distributions to shareholders in complete redemption of the Common Stock; and (5) the authorization of the filing of Articles of Dissolution. The Board of Directors and Wexford have agreed to an extension of the management agreement with Wexford, which was due to expire on May 4, 1997, under a reduced fee arrangement through December 31, 1997 (the "Extended Management Agreement") and to replace all of the Management Options issued to Wexford with a compensation package designed to provide the same economic benefits as the Management Options. The replacement of the Management Options is contingent upon shareholder approval of the Plan. The Extended Management Agreement provides for a fee payable to Wexford of $1,152,125 for the year ending December 31, 1997 subject to adjustment based on actual expenses. A copy of Amendment No. 2 to the management agreement is filed as an exhibit hereto. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following section includes a discussion and analysis of the results of the Company for the quarter ended March 31, 1997. Plan of Liquidation On April 28, 1997, the Board of Directors approved a plan of complete liquidation and dissolution of the Company (the "Plan") for submission to its shareholders for their approval at the annual shareholders meeting expected to be held during the third quarter of 1997. The effective date of the Plan will be upon the affirmative vote of a majority of the Company's shareholders. Among the key features of the Plan are: (1) the cessation of all business activities, other than those in furtherance of the Plan; (2) the sale or disposition of all of the Company's assets; (3) the satisfaction of all outstanding liabilities; (4) the payment of liquidating distributions to shareholders in complete redemption of the Common Stock; and (5) the authorization of the filing of Articles of Dissolution. Results of Operations - General The Company has disposed of a significant portion of its portfolio acquired under the plan of reorganization of Liberte Investors. The future performance of the Company's portfolio of assets will be subject to prevailing economic conditions and to financial, business and other factors, including the future performance of the real estate market, the availability of financing to prospective asset purchasers, the timing of the liquidation of the Company and to other factors beyond the Company's control. For these reasons, the results of the Company's operations from period to period may not be comparable. Three Months Ended March 31, 1997 Compared To Three Months Ended March 31, 1996 For the three months ended March 31, 1997, revenues related to the operations of the Company's operating properties decreased to $3,281,000 from $4,835,000 for the same period in the prior year, primarily as a result of the disposition of eight operating properties (four during the period from April 1996 through December 1996 and four in the first quarter of 1997). For the same period, property operating expenses correspondingly decreased to $1,396,000 from $1,904,000 in the prior year, primarily as a result of the disposition of the eight properties. Depreciation and amortization for the three months ended March 31, 1997 and 1996 amounted to $398,000 and $777,000, respectively. The decrease in depreciation and amortization is a result of the disposition of the eight operating properties as mentioned above. Mortgage loan interest decreased to zero for the three months ended March 31, 1997 from $445,000 for the same period in the prior year, primarily as a result of the sale and/or repayment of all of the mortgage loans. Investment income increased to $124,000 for the three months ended March 31, 1997 from $95,000 for the same period in the prior year, primarily due to a higher amount of cash available for investment for the three months ended March 31, 1997. Interest expense decreased to $109,000 for the three months ended March 31, 1997 from $1,112,000 for the same period in the prior year, primarily due to the repayment of the entire outstanding balance of the Senior Debt in January 1997. Expenses related to non-income producing assets decreased to $64,000 for the three months ended March 31, 1997 from $382,000 for the same period in the prior year, primarily as a result of asset sales. General and administrative expenses, which primarily consist of insurance, consulting, legal and accounting fees, decreased to $167,000 for the three months ended March 31, 1997 from $186,000 for the same period in the prior year, primarily due to a decrease in insurance and legal fees. In connection with the Company's purchases of interests in the Senior Debt during the three months ended March 31, 1996, the Company recorded an extraordinary gain of $114,000. Capital Expenditures Capital expenditures for the three months ended March 31, 1997 were $153,000, of which approximately $119,000 related to tenant improvements. The balance of the expenditures was for normal property improvements. The source of funds for such capital expenditures was from cash generated from rents and proceeds from the sale of assets. Liquidity and Capital Resources For the three months ended March 31, 1997, cash and cash equivalents increased by $23,995,000. $655,000 was provided by operating activities, $25,980,000 was provided by investing activities and $2,640,000 was used for financing activities. Cash provided by investing activities consisted primarily of net proceeds from asset sales of $25,834,000 and net collections on mortgage loans of $299,000, partially offset by improvements to the operating properties of $153,000. Cash used for financing activities consisted primarily of net Senior Debt repayments of $2,490,000 and mortgage repayments of $143,000. In January 1997, the Company repaid the entire outstanding balance of its Senior Debt, including accrued interest, obtained lien releases on all of its collateralized assets and terminated the Secured Credit Agreement. During the quarter ended March 31, 1997, the Company sold Abco Plaza, Bayshore Club Apartments, Riverbend Shopping Center, 1025 Vermont Avenue and various land assets for net proceeds of approximately $6,539,000, $3,843,000, $620,000, $12,495,000 and $2,337,000, respectively. These sales resulted in a net gain of $3,028,000, after deducting closing costs. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K: (a) Not applicable. Exhibit Number Description -------------- ----------- 10.1 Amendment Number 2, dated May 4, 1997, to the Management Agreement, dated as of May 4, 1994, and as amended by Amendment Number 1, dated March 8, 1995, between Resurgence Properties Inc., Resurgence Properties Texas, L.P. and Wexford Management LLC. (b) None. The Company was not required to file any reports on Form 8-K during the quarter ended March 31, 1997. 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. Resurgence Properties Inc. Date: May 14, 1997 By: /s/ Joseph M. Jacobs -------------------- Joseph M. Jacobs Chief Executive Officer and President (Duly Authorized Officer) Date: May 14, 1997 By: /s/ Jay L. Maymudes ------------------- Jay L. Maymudes Chief Financial Officer, Vice President and Secretary (Principal Financial and Accounting Officer and Duly Authorized Officer) EX-10.1 2 Exhibit 10.1 RESURGENCE PROPERTIES INC. 411 West Putnam Avenue Greenwich, Connecticut 06830 May 4, 1997 Wexford Management LLC 411 West Putnam Avenue Greenwich, Connecticut 06830 Re: Amendment No. 2 to the Management Agreement Dear Sirs: Reference is hereby made to the Management Agreement (the "Management Agreement"), dated as of May 4, 1994, and as amended by Amendment No. 1, dated March 8, 1995, between Resurgence Properties Inc. ("RPI"), a Maryland corporation, Resurgence Properties Texas, L.P., a Delaware limited partnership (RPI and Resurgence Properties Texas, L.P. are hereinafter collectively referred to as the "Company"), and Wexford Management LLC as successor to Concurrency Management Corp. ("Wexford" or the "Manager"). Capitalized terms used but not defined herein shall have the meanings specified in the Management Agreement. The parties desire to further amend the Management Agreement pursuant to this Amendment No. 2. Accordingly, the Company and Wexford hereby agree as follows: 1. Section 4.01 of the Management Agreement is hereby amended and restated in its entirety as follows: 4.01 Management Fee. From January 1, 1997 through the earlier of the termination of this Agreement and December 31, 1997, the Management Fee payable to the Manager shall be (i) $570,500 for the period from January 1, 1997 through May 4, 1997, (ii) $246,000 for the period from May 5, 1997 through June 30, 1997, (iii) $223,750 for the period from July 1, 1997 through September 30, 1997, and (iv) $111,875 for the period from October 1, 1997 through December 31, 1997, for a total of $1,152,125, subject to upward or downward adjustment, upon expiration or termination of this Agreement, to Actual Expenses (as defined below). The Management Fee shall be payable monthly in arrears on the first (1st) day of each calendar month; provided, however, that in respect of any partial month the Management Fee payable for such month shall be pro rated based on the actual number of days in such month prior to the date of expiration or termination. Within 90 days after the expiration or termination of this Agreement, Wexford or a majority of the non-Wexford affiliated members of the Board of Directors of the Company may request that the outside accountants for the Company review the calculation of Actual Expenses, which review shall be final and binding. Any adjustment payment shall be made within 15 days of the delivery of such certification to Wexford and the Board of Directors of the Company. "Actual Expenses" shall be equal to the sum of (i) the cost to Wexford (exclusive of any salary or health or other benefits payable to or on account of Jacobs and Holtz) for the period January 1, 1997 through the earlier of the termination of this Agreement and December 31, 1997 in providing services to the Company under this Agreement, plus (ii) the sum of the annual salaries for Jacobs and Holtz (regardless of whether such salaries have been or will be paid by the Manager and so long as Holtz remains employed by the Manager) in the amounts of (a) $125,000 and $41,667, respectively, for the period from January 1, 1997 through May 4, 1997, (b) $62,500 and $20,833, respectively, for the period from May 5, 1997 through June 30, 1997, (c) $46,875 and $15,625, respectively, for the period from July 1, 1997 through September 30, 1997, and (d) $23,438 and $7,813, respectively, for the period from October 1, 1997 through December 31, 1997 (aggregating $257,813 and $85,938 for Jacobs and Holtz, respectively, for 1997), plus health and other benefits payable in connection therewith. 2. Section 4.02 of the Management Agreement is amended by adding the following: The aggregate of (i) the Management Options that have not been granted, (ii) the Management Options that have been granted but have been forfeited and (iii) the Management Options that have been granted but with respect to which a Replacement Agreement, in the form of Exhibit A or Exhibit B, hereto has been or will be executed and delivered to RPI by a holder thereof (the "Replaced Options") are hereby canceled and replaced by an obligation of RPI to pay a cash fee (the "Management Distributions") in an amount determined by multiplying a fraction, the numerator of which is the Replaced Options and the denominator of which is 1,111,111 by ten (10%) percent of all distributions made to the shareholders of RPI (inclusive of the $2.50 per share dividend paid to shareholders of RPI on April 14, 1997 and any other dividends paid to shareholders of RPI prior to the effective date of this Section 2) in excess of $8.50 per share (the "Threshold Distribution"). The Management Distributions shall be fully vested. Jacobs may grant rights ("Rights") in the Management Distributions in the same manner and with the same terms as provided for the Management Options. Jacobs shall be entitled to receive the balance of the Management Distributions with respect to which Rights have not been granted and with respect to which granted Rights have been terminated. The Management Distributions shall be paid to each holder of Rights concurrently with the payment of the related distributions to the shareholders of RPI once the Threshold Distribution has been made. 3. Section 4.08 of the Management Agreement is hereby deleted and removed in its entirety from the Management Agreement. 4. Section 5.01 of the Management Agreement is hereby amended and restated in its entirety as follows: 5.01 Primary Term and Renewals. This Agreement shall become effective on the date the Company executes this Agreement and shall continue in full force and effect until the earlier of (i) December 31, 1997, (ii) the effective date of the Articles of Dissolution filed by RPI with the Maryland State Department of Assessments and Taxation, (iii) such later date as extended in writing by the Manager and the Company (it being agreed that neither party shall have any obligation whatsoever to extend this Agreement), unless, in each such case, otherwise terminated as provided in Sections 5.02 or 5.03 below. 5. Section 5.02 of the Management Agreement is hereby amended and restated in its entirety as follows: Section 5.02 The Company's Right of Termination. Notwithstanding anything to the contrary contained in this Agreement, the Company may terminate this Agreement at any time, with or without cause, and without any penalty, by either (i) the affirmative vote of the majority of the members of the Board of Directors of RPI, or (ii) the affirmative vote or written consent of a majority of the stockholders of RPI. Such termination shall not affect the right of the Manager to receive any compensation due hereunder through such date of termination, or the obligations of the Company under Sections 3.01, 3.03 and 4.02. 6. All other terms and conditions of the Management Agreement shall remain in full force and effect as provided therein. 7. The effective date of Section 1 and Section 3 of this Amendment No. 2 to the Management Agreement shall be the date on which it has been executed and delivered by each of the Manager and the Company. The effective date of the remainder of this Amendment No. 2 to the Management Agreement shall be the date on which the Plan of Complete Liquidation and Dissolution of the Company shall have been approved by the affirmative vote of the holders of a majority of the outstanding shares of the Company's common stock, par value $.01 per share, entitled to vote thereon. Very truly yours, RESURGENCE PROPERTIES INC. By:_______________________ Name: Title: RESURGENCE PROPERTIES TEXAS, L.P. By: RESURGENCE TX GP, INC., General Partner By:________________________ Name: Title: AGREED AND ACCEPTED: WEXFORD MANAGEMENT LLC By:_______________________________ Name: Title: EX-27 3
5 THE SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF THE MARCH 31, 1997 FORM 10Q OF RESURGENCE PROPERTIES INC. AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS DEC-31-1997 MAR-31-1997 28,373,000 0 1,190,000 (111,000) 0 0 0 0 94,328,000 0 0 0 300,000 100,000 62,192,000 94,328,000 0 6,781,000 0 1,396,000 1,077,000 0 109,000 4,199,000 0 4,199,000 0 0 0 4,199,000 0 0
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