FORM 10-QSB---QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(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, 2000
[ ] 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 0-9136
ANGELES PARTNERS VIII
(Exact name of small business issuer as specified in its charter)
California 95-3264317
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 Beattie Place, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No___
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a)
ANGELES PARTNERS VIII
CONSOLIDATED STATEMENT OF NET LIABILITIES IN LIQUIDATION
(Unaudited)
(in thousands)
June 30, 2000
Assets
Cash and cash equivalents $ 144
Receivables and deposits 157
Prepaid assets 34
Investment property 5,274
5,609
Liabilities
Accounts payable 25
Tenant security deposit liabilities 31
Accrued property taxes 257
Other liabilities 38
Due to affiliate 67
Accrued interest ($306 in default) 306
Mortgage and notes payable ($5,582 in
default) 5,582
Estimated costs during the period of
liquidation 127
6,433
Net liabilities in liquidation $ (824)
See Accompanying Notes to Consolidated Financial Statements
ANGELES PARTNER VIII
CONSOLIDATED STATEMENT OF CHANGES IN NET LIABILITIES IN LIQUIDATION
(Unaudited)
(in thousands)
Six months Ended June 30, 2000
Net liabilities in liquidation at December 31, 1999 $ (4,116)
Changes in net liabilities in liquidation attributed to:
Decrease in cash and cash equivalents (82)
Increase in receivables and deposits 22
Increase in prepaid assets 34
Increase in estimated net realizable value of
property and improvements 524
Increase in due to affiliate (46)
Decrease in accounts payable 3
Increase in tenant security deposit liabilities (6)
Decrease in accrued interest 2,394
Decrease in accrued property taxes 27
Decrease in other liabilities 43
Decrease in mortgage notes payable 36
Decrease in estimated costs during the period of liquidation 343
Net liabilities in liquidation at June 30, 2000 $ (824)
See Accompanying Notes to Consolidated Financial Statements
b)
ANGELES PARTNERS VIII
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1999 June 30, 1999
Revenues:
<S> <C> <C>
Rental income $ 945 $ 1,873
Other income 53 109
Total revenues 998 1,982
Expenses:
Operating 388 792
General and administrative 22 71
Depreciation 180 350
Interest 481 958
Property taxes 106 221
Total expenses 1,177 2,392
Net loss $ (179) $ (410)
Net loss allocated to general partner (1%) $ (2) $ (4)
Net loss allocated to limited partners (99%) (177) (406)
$ (179) $ (410)
Net loss per limited partnership unit $ (15.05) $ (34.52)
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
c)
ANGELES PARTNERS VIII
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Six months Ended June 30, 1999
Cash flows from operating activities:
Net loss $ (410)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation 350
Amortization of loan costs 28
Change in accounts:
Receivables and deposits 104
Other assets (47)
Accounts payable 93
Tenant security deposit liabilities 2
Accrued property taxes (188)
Accrued interest 281
Other liabilities (2)
Due to affiliates 41
Net cash provided by operating activities 252
Cash flows used in investing activities:
Property improvements and replacements (130)
Cash flows used in financing activities:
Payments on mortgage notes payable (153)
Net decrease in cash and cash equivalents (31)
Cash and cash equivalents at beginning of period 317
Cash and cash equivalents at end of period $ 286
Supplemental disclosure of cash flow information:
Cash paid for interest $ 650
See Accompanying Notes to Consolidated Financial Statements
d)
ANGELES PARTNERS VIII
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note A - Basis of Presentation
As of September 30, 1999, Angeles Partners VIII (the "Partnership" or
"Registrant") adopted the liquidation basis of accounting due to the imminent
loss of its remaining investment property. The Partnership has incurred
recurring operating losses and continues to suffer from inadequate liquidity. In
addition, the Partnership is in default on its first and second mortgage notes
payable and does not generate sufficient cash flows to meet current debt-service
requirements on its subordinated debt. No other sources of additional financing
are available to the Partnership and Angeles Realty Corporation ("ARC" or the
"General Partner") does not have any other plans to remedy the liquidity
problems the Partnership is currently experiencing.
The Partnership had an outstanding obligation due to an affiliate of the General
Partner (the "Affiliate") for cumulative unpaid accountable administrative
services. This liability was secured by the Partnership's 99% limited
partnership interest in Brittany Point AP VIII L.P. ("Brittany LP"), the entity
that owned Brittany Point Apartments. During the third quarter of 1999, the
Affiliate exercised remedies with respect to this liability. In such exercise,
effective September 20, 1999, the Affiliate acquired the Partnership's 99%
limited partnership interest in Brittany LP at a public sale in compliance with
the South Carolina Uniform Commercial Code.
The Affiliate has the power to remove the general partner of Brittany LP, an
entity in which the Partnership owns an interest. While the Affiliate did not
effect such a removal during the six month period ended June 30, 2000, there can
be no assurance that such general partner will not be removed at some point in
the future, thereby causing the loss of the Partnership's entire interest in
Brittany LP.
In addition, as of June 1, 2000, the Partnership's non-recourse first mortgage
of approximately $3,861,000 is in default due to the nonpayment of the remaining
balance upon maturity. Also, the Partnership's second mortgage to Angeles
Mortgage Investment Trust ("AMIT") in the amount of approximately $1,350,000,
plus accrued interest of approximately $2,768,000, which is secured by the
Partnership's remaining investment property, Bercado Shores Apartments, has been
in default since 1993 due to nonpayment of interest and the maturity of the note
in 1995. Pursuant to a series of transactions, affiliates of the General Partner
acquired ownership interests in AMIT. On September 17, 1998, AMIT was merged
with and into Insignia Properties Trust ("IPT"), which was the sole shareholder
of the General Partner. On February 26, 1999, IPT was merged into Apartment
Investment and Management Company ("AIMCO"), a publicly traded real estate
investment trust. As a result, AIMCO is the current holder of the AMIT debt.
This indebtedness is recourse to the Partnership and the estimated fair value of
this property is less than the total of its first and second mortgages. This
property was subject to foreclosure under the terms of the second mortgage
agreement. On July 17, 2000, AMIT informed the General Partner of its intention
to exercise remedies with respect to all or a portion of such indebtedness.
The General Partner believed that the use by the Partnership of its limited
resources to contest the exercise of such remedies would be futile and
accordingly, the General Partner executed settlement documents to effect the
exercise of such remedies in a manner that is cost effective to the Partnership.
(See "Note F - Subsequent Event").
Due to the loss of Brittany LP and the then imminent loss of Bercado Shores
Apartments, the General Partner decided in September 1999 to terminate the
Partnership upon the loss of Bercado Shores Apartments. As a result of the
decision to liquidate the Partnership, the Partnership changed its basis of
accounting for its consolidated financial statements at September 30, 1999, to
the liquidation basis of accounting. Consequently, assets have been valued at
their estimated net realizable value and liabilities are presented at their
estimated settlement amounts, including estimated costs associated with carrying
out the liquidation. The valuation of assets and liabilities necessarily
requires many estimates and assumptions and there are substantial uncertainties
in carrying out the liquidation. The actual realization of assets and settlement
of liabilities could be higher or lower than amounts indicated and is based upon
the General Partner's estimates as of the date of the consolidated financial
statements.
The remaining investment property of the Partnership was adjusted to its
estimated net realizable value. Included in liabilities in the statement of net
liabilities in liquidation, as of June 30, 2000, are approximately $127,000 of
costs that the General Partner estimates will be incurred during the period of
liquidation, based on the assumption that the liquidation process will be
completed by December 31, 2000. These costs principally include the estimated
net loss for Bercado Shores and interest and administrative expenses for the
Partnership. Because the success in realization of assets and the settlement of
liabilities is based on the General Partner's best estimates, the liquidation
period may be shorter than projected or it may be extended beyond the projected
period.
Note B - Transfer of Control
Pursuant to a series of transactions which closed on October 1, 1998 and
February 26, 1999, Insignia Financial Group, Inc. and IPT merged into AIMCO,
with AIMCO being the surviving corporation (the "Insignia Merger"). As a result,
AIMCO acquired 100% ownership interest in the General Partner. The General
Partner does not believe that this transaction has had or will have a material
effect on the affairs and operations of the Partnership.
Note C - Transactions with Affiliated Parties
The Partnership has no employees and is dependent on the General Partner and its
affiliates for the management and administration of all Partnership activities.
The Partnership Agreement provides for (i) certain payments to affiliates of the
General Partner for services and (ii) reimbursement of certain expenses incurred
by affiliates on behalf of the Partnership.
The following transactions were paid or accrued to the General Partner and its
affiliates during the six months ended June 30, 2000 and 1999, respectively:
2000 1999
(in thousands)
Property management fees (included in
operating expenses in 1999) $ 40 $102
Reimbursement for services of affiliates
(included in general and administrative
expenses in 1999) 48 44
During the six months ended June 30, 2000 and 1999, affiliates of the General
Partner were entitled to receive 5% of gross receipts from the Partnership's
property for providing property management services. The Partnership paid to
such affiliates approximately $40,000 and $102,000 for the six months ended June
30, 2000 and 1999, respectively.
Affiliates of the General Partner were entitled to reimbursements of accountable
administrative expense amounting to approximately $48,000 and $44,000 for the
six months ended June 30, 2000 and 1999, respectively.
In June 1990, AMIT provided secondary financing on the Partnership's investment
property, Bercado Shores Apartments. Total indebtedness was approximately
$1,350,000 at June 30, 2000, and is in default at June 30, 2000. Total interest
expense related to this debt was approximately $318,000 and $384,000 for the six
months ended June 30, 2000 and 1999, respectively. Accrued interest related to
this debt was approximately $2,768,000. As discussed in "Note A - Basis of
Presentation", AIMCO is now the holder of the AMIT debt. The AMIT mortgage
secured by Bercado Shores Apartments has been in default since 1993 due to
nonpayment of interest and the maturity of the note in 1995. Subsequent to June
30, 2000, Bercado Shores Apartments was deeded in lieu of foreclosure to AIMCO
as satisfaction of the AMIT mortgage (see "Note F - Subsequent Event"). The
Partnership also had an outstanding obligation due to an affiliate of the
General Partner (the "Affiliate") for cumulative unpaid accountable
administrative services. This liability was secured by the Partnership's 99%
limited partnership interest in Brittany LP, the entity that owned Brittany
Point Apartments. During the third quarter of 1999, the Affiliate exercised
remedies with respect to this liability. In such exercise, effective September
20, 1999, the Affiliate acquired the Partnership's 99% limited partnership
interest in Brittany LP at a public sale in compliance with the South Carolina
Uniform Commercial Code.
In November 1992, Angeles Acceptance Pool, L.P. ("AAP"), a Delaware limited
partnership which now controls the working capital loan previously provided by
Angeles Capital Investment, Inc. ("ACII"), was organized. Angeles Corporation
("Angeles") is the 99% limited partner of AAP and Angeles Acceptance Directives,
Inc. ("AAD"), which was wholly-owned by IPT, was, until April 14, 1995, the 1%
general partner of AAP. On April 14, 1995, as part of a settlement of claims
between affiliates of the General Partner and Angeles, AAD resigned as general
partner of AAP and simultaneously received a .5% limited partner interest in
AAP. An affiliate of Angeles now serves as the general partner of AAP. The
Partnership's note payable of approximately $371,000, plus accrued interest of
approximately $243,000, due to AAP is in default due to non-payment upon
maturity in November 1997. AAP has filed suit against the Partnership as a
result of this default. A judgment has been awarded to AAP; however, the
Partnership intends to contest the validity of the judgment if AAP attempts to
enforce it. Interest is accruing monthly at prime plus 0.75% (9.25% average rate
at June 30, 2000). Total interest expense for this loan was approximately
$17,000 and $15,000 for the six months ended June 30, 2000 and 1999,
respectively.
Note D - Segment Reporting
The Partnership has only one reportable segment. Moreover, due to the very
nature of the Partnership's operations, the General Partner believes that
segment-based disclosures will not result in a more meaningful presentation than
the financial statements as currently presented.
Note E - Legal Proceedings
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs named as defendants, among others,
the Partnership, its General Partner and several of their affiliated
partnerships and corporate entities. The action purports to assert claims on
behalf of a class of limited partners and derivatively on behalf of a number of
limited partnerships (including the Partnership) which are named as nominal
defendants, challenging the acquisition of interests in certain general partner
entities by Insignia Financial Group, Inc. and entities which were, at one time,
affiliates of Insignia; past tender offers by the Insignia affiliates to acquire
limited partnership units; the management of partnerships by the Insignia
affiliates; and the Insignia Merger. The plaintiffs seek monetary damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998, the General Partner filed a motion seeking dismissal of the action. In
lieu of responding to the motion, the plaintiffs have filed an amended
complaint. The General Partner filed demurrers to the amended complaint which
were heard February 1999.
Pending the ruling on such demurrers, settlement negotiations commenced. On
November 2, 1999, the parties executed and filed a Stipulation of Settlement,
settling claims, subject to final court approval, on behalf of the Partnership
and all limited partners who owned units as of November 3, 1999. Preliminary
approval of the settlement was obtained on November 3, 1999 from the Court, at
which time the Court set a final approval hearing for December 10, 1999. Prior
to the December 10, 1999 hearing, the Court received various objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement. On
December 14, 1999, the General Partner and its affiliates terminated the
proposed settlement. In February 2000, counsel for some of the named plaintiffs
filed a motion to disqualify plaintiff's lead and liaison counsel who negotiated
the settlement. On June 27, 2000, the Court entered an order disqualifying them
from the case. The Court will entertain applications for lead counsel which must
be filed by August 4, 2000. The Court has scheduled a hearing on August 21, 2000
to address the issue of appointing lead counsel. The General Partner does not
anticipate that costs associated with this case will be material to the
Partnership's overall operations.
The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature arising in the ordinary course of business.
Note F - Subsequent Event
On July 17, 2000, the Partnership delivered a deed in lieu of foreclosure
related to Bercado Shores Apartments to AIMCO in satisfaction of the AMIT second
mortgage of approximately $1,350,000 plus accrued interest of approximately
$2,768,000. In addition, the non-recourse first mortgage of approximately
$3,861,000 has been transferred with the apartment property. Accordingly, at
June 30, 2000 the total mortgage debt and related accrued interest have been
reduced to its estimated settlement value of $5,274,000, which approximates the
estimated net realizable value of Bercado Shores Apartments.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The matters discussed in this Form 10-QSB contain certain forward-looking
statements and involve risks and uncertainties (including changing market
conditions, competitive and regulatory matters, etc.) detailed in the
disclosures contained in this Form 10-QSB and the other filings with the
Securities and Exchange Commission made by the Partnership from time to time.
The discussion of the Registrant's business and results of operations, including
forward-looking statements pertaining to such matters, does not take into
account the effects of any changes to the Registrant's business and results of
operations. Accordingly, actual results could differ materially from those
projected in the forward-looking statements as a result of a number of factors,
including those identified herein.
The Partnership's investment property consists of one apartment complex. The
following table sets forth the average occupancy of the property for the six
months ended June 30, 2000 and 1999:
Average Occupancy
Property 2000 1999
Bercado Shores Apartments 96% 90%
Mishawaka, Indiana
The increase in occupancy is attributed to a change in the types of leases
offered and the staggering of lease expirations so that leases do not all expire
at the same time. Subsequent to June 30, 2000, Bercado Shores was deeded in lieu
of foreclosure to AIMCO as satisfaction of the AMIT mortgage. (See below).
Liquidity and Capital Resources
As of September 30, 1999, the Partnership adopted the liquidation basis of
accounting due to the imminent loss of its remaining investment property. The
Partnership has experienced significant recurring operating losses, is in
default on its first and second mortgage notes payable and does not generate
sufficient cash flow to meet current debt service requirements on its
subordinated debt. No other sources of additional financing are available to the
Partnership and the General Partner does not have any other plans to remedy the
liquidity problems the Partnership is currently experiencing.
The Partnership had an outstanding obligation due to an affiliate of the General
Partner (the "Affiliate") for cumulative unpaid accountable administrative
services. This liability was secured by the Partnership's 99% limited
partnership interest in Brittany Point AP VIII L.P. ("Brittany LP"), the entity
that owned Brittany Point Apartments. During the third quarter of 1999, the
Affiliate exercised remedies with respect to this liability. In such exercise,
effective September 20, 1999, the Affiliate acquired the Partnership's 99%
limited partnership interest in Brittany LP at a public sale in compliance with
the South Carolina Uniform Commercial Code.
The Affiliate has the power to remove the general partner of Brittany LP, an
entity in which the Partnership owns an interest. While the Affiliate did not
effect such a removal during the six months ended June 30, 2000, there can be no
assurance that such general partner will not be removed at some point in the
future, thereby causing the loss of the Partnership's entire interest in
Brittany LP.
In addition, as of June 1, 2000, the Partnership's non-recourse first mortgage
of approximately $3,861,000 is in default due to the nonpayment of the remaining
balance upon maturity. Also, the Partnership's second mortgage to Angeles
Mortgage Investment Trust ("AMIT") in the amount of approximately $1,350,000,
plus accrued interest of approximately $2,768,000, which is secured by the
Partnership's remaining investment property, Bercado Shores Apartments, has been
in default since 1993 due to nonpayment of interest and the maturity of the note
in 1995. Pursuant to a series of transactions, affiliates of the General Partner
acquired ownership interests in AMIT. On September 17, 1998, AMIT was merged
with and into Insignia Properties Trust ("IPT"), which was the sole shareholder
of the General Partner. On February 26, 1999, IPT was merged into Apartment
Investment and Management Company ("AIMCO"), a publicly traded real estate
investment trust. As a result, AIMCO is the current holder of the AMIT debt.
This indebtedness is recourse to the Partnership and the estimated fair value of
this property is less than the total of its first and second mortgages. This
property was subject to foreclosure under the terms of the second mortgage
agreement. On July 17, 2000, AMIT informed the General Partner of its intention
to exercise remedies with respect to all or a portion of such indebtedness. The
General Partner believed that the use by the Partnership of its limited
resources to contest the exercise of such remedies would be futile and
accordingly, the General Partner executed settlement documents to effect the
exercise of such remedies in a manner that is cost effective to the Partnership.
On July 17, 2000, the Partnership delivered a deed in lieu of foreclosure
related to Bercado Shores Apartments to AIMCO in satisfaction of the AMIT second
mortgage of approximately $1,350,000 plus accrued interest of approximately
$2,768,000. In addition, the non-recourse first mortgage of approximately
$3,861,000 has been transferred with the apartment property. Accordingly, at
June 30, 2000 the total mortgage debt and related accrued interest have been
reduced to its estimated settlement value of $5,274,000, which approximates the
estimated net realizable value of Bercado Shores Apartments.
The Partnership's note payable of approximately $371,000, plus accrued interest
of approximately $243,000, due to AAP is in default due to non-payment upon
maturity in November 1997. AAP has filed suit against the Partnership as a
result of this default. A judgement has been awarded to AAP however the
Partnership intends to contest the validity of the judgment if AAP attempts to
enforce it.
Due to the loss of Brittany LP and the then imminent loss of Bercado Shores
Apartments the General Partner decided in September 1999 to terminate the
Partnership upon the loss of Bercado Shores Apartments. As a result of the
decision to liquidate the Partnership, the Partnership changed its basis of
accounting for its consolidated financial statements at September 30, 1999, to
the liquidation basis of accounting. Consequently, assets have been valued at
their estimated net realizable value and liabilities are presented at their
estimated settlement amounts, including estimated costs associated with carrying
out the liquidation. The valuation of assets and liabilities necessarily
requires many estimates and assumptions and there are substantial uncertainties
in carrying out the liquidation. The actual realization of assets and settlement
of liabilities could be higher or lower than amounts indicated and is based upon
the General Partner's estimates as of the date of the consolidated financial
statements.
For the six months ended June 30, 2000, the Partnership recorded a net decrease
in net liabilities in liquidation of approximately $343,000. The statement of
net liabilities in liquidation as of June 30, 2000 includes approximately
$127,000 of costs that the General Partner estimates will be incurred during the
period of liquidation based on the assumption that the liquidation process will
be complete by December 31, 2000. These costs include the estimated net loss for
the year ended December 31, 2000 for the remaining property, Bercado Shores. In
addition, the costs also include anticipated legal fees and administrative
expenses for the year ended December 31, 2000. Because the success in
realization of assets and the settlement of liabilities is based on the General
Partner's best estimates, the liquidation period may be shorter than projected
or it may be extended beyond the projected period.
The following is a general description of the tax consequences that may result
to a limited partner of the transfer of the Partnership's property and the
removal of the general partner of Brittany LP. Each limited partner should
consult with his or her own tax advisor to determine his or her particular tax
consequences. The transfer of the limited partnership interests in Brittany LP
in satisfaction of Partnership debt resulted in the taxable sale or exchange of
the limited partnership interests. The removal of the general partner of
Brittany Point LP will result in a deemed cash distribution to the general
partner. The transfer of Bercado Shores in satisfaction of secured, recourse
Partnership debt resulted in taxable gain to the extent the amount of the senior
indebtedness plus the amount of the subordinate indebtedness exceeds the
property's tax basis. A portion of such gain may constitute cancellation of
indebtedness income, if and to the extent the subordinated indebtedness exceeded
the fair market value of the property. The taxable gain and income resulting
from the transfer of the Partnership property and the removal of the general
partner will pass through to the limited partners, and will likely result in
income tax liability to the limited partners without any distribution of cash
from the Partnership.
There were no distributions paid for the six months ended June 30, 2000 or 1999.
Future cash distributions will depend on the estimated levels of net cash
generated from the liquidation of the Partnership. However, based on the
Partnership's liabilities upon liquidation, it is unlikely that any such
distribution will be made.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs named as defendants, among others,
the Partnership, its General Partner and several of their affiliated
partnerships and corporate entities. The action purports to assert claims on
behalf of a class of limited partners and derivatively on behalf of a number of
limited partnerships (including the Partnership) which are named as nominal
defendants, challenging the acquisition of interests in certain general partner
entities by Insignia Financial Group, Inc. and entities which were, at one time,
affiliates of Insignia; past tender offers by the Insignia affiliates to acquire
limited partnership units; the management of partnerships by the Insignia
affiliates; and the Insignia Merger. The plaintiffs seek monetary damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998, the General Partner filed a motion seeking dismissal of the action. In
lieu of responding to the motion, the plaintiffs have filed an amended
complaint. The General Partner filed demurrers to the amended complaint which
were heard February 1999.
Pending the ruling on such demurrers, settlement negotiations commenced. On
November 2, 1999, the parties executed and filed a Stipulation of Settlement,
settling claims, subject to final court approval, on behalf of the Partnership
and all limited partners who owned units as of November 3, 1999. Preliminary
approval of the settlement was obtained on November 3, 1999 from the Court, at
which time the Court set a final approval hearing for December 10, 1999. Prior
to the December 10, 1999 hearing, the Court received various objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement. On
December 14, 1999, the General Partner and its affiliates terminated the
proposed settlement. In February 2000, counsel for some of the named plaintiffs
filed a motion to disqualify plaintiff's lead and liaison counsel who negotiated
the settlement. On June 27, 2000, the Court entered an order disqualifying them
from the case. The Court will entertain applications for lead counsel which must
be filed by August 4, 2000. The Court has scheduled a hearing on August 21, 2000
to address the issue of appointing lead counsel. The General Partner does not
anticipate that costs associated with this case will be material to the
Partnership's overall operations.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to
this report.
b) Reports on Form 8-K:
None filed during the quarter ended June 30, 2000.
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ANGELES PARTNERS VIII LIMITED PARTNERSHIP
By: Angeles Realty Corporation
Its General Partner
By: /s/Patrick J. Foye
Patrick J. Foye
Executive Vice President
By: /s/Martha L. Long
Martha L. Long
Senior Vice President and
Controller
Date: August 22, 2000
