FORM 10-KSB - ANNUAL OR TRANSITIONAL REPORT UNDER
SECTION 13 OR 15(D)
U.S. SECURITIES AND EXCHANGE COMMISSION
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
Commission file number 0-9680
CENTURY PROPERTIES FUND XV
(Name of small business issuer in its charter)
California 94-2625577
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip code)
Issuer's telephone number (864) 239-1000
Securities registered under Section 12(b) of the Exchange Act:
None
Securities registered under Section 12(g) of the Exchange Act:
Limited Partnership Units
(Title of class)
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
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. X
State issuer's revenues for its most recent fiscal year. $10,177,000.
State the aggregate market value of the voting stock held by nonaffiliates of
the Registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within the past 60 days. Market value information
for Registrant's Partnership Interests is not available. Should a trading market
develop for these Interests, it is management's belief that such trading would
not exceed $25 million.
DOCUMENTS INCORPORATED BY REFERENCE
None
PART I
ITEM 1. DESCRIPTION OF BUSINESS
Century Properties Fund XV (the "Partnership") was organized in December 1979 as
a California limited partnership under the Uniform Limited Partnership Act of
the California Corporations Code. The general partners are Fox Capital
Management Corporation ("FCMC" or the "Managing General Partner"), a California
corporation, and Fox Realty Investors ("FRI"), a California general partnership.
The Partnership's Registration Statement, filed pursuant to the Securities Act
of 1933 (No. 2-66459), was declared effective by the Securities and Exchange
Commission on May 1, 1980. The Partnership marketed its securities pursuant to
its Prospectus dated May 1, 1980, as revised on May 29, 1980, and thereafter
supplemented (hereinafter the "Prospectus"). This Prospectus was filed with the
Securities and Exchange Commission pursuant to Rule 424 (b) of the Securities
Act of 1933. The principal business of the Partnership is and has been to
acquire, hold for investment and ultimately sell income-producing real property.
Beginning in July 1980 through April 1981, the Partnership offered $90,000,000
in Limited Partnership units and sold units having an initial cost of
$89,980,000.
The net proceeds of this offering were used to acquire seventeen income-
producing real properties. The Partnership's original property portfolio was
geographically diversified with properties acquired in eight states. The
Partnership's acquisition activities were completed in June 1982, and since then
the principal activity of the Partnership has been managing its portfolio. In
the period from 1986 through January 1992, six office buildings, three apartment
buildings, and one shopping center were sold or otherwise disposed of. The
Partnership sold two of its properties in 1995, an additional property was sold
in the first quarter of 1996 and its remaining commercial property was sold in
January 1997. See "Item 2, Description of Properties" for a description of the
Partnership's properties.
On August 10, 1994, National Property Investors, Inc. ("NPI"), the then parent
company of the Managing General Partner, entered into an agreement with an
affiliate of Apollo Real Estate Advisors, L.P. ("Apollo") to sell to Apollo up
to one-third of the stock of NPI. In addition, Apollo obtained general and
limited partnership interests in NPI-AP Management, L.P. ("NPI-AP"), an
affiliate of the Managing General Partner. NPI-AP is a Delaware limited
partnership whose general partner is NPI Property Management Corporation ("NPI
Management"), an affiliate of NPI. NPI-Management became the managing general
partner of NPI-AP, and assigned its interest in the management contract for the
Partnership's properties to the partnership as well as all other properties it
manages for partnerships affiliated with the Managing General Partner.
On October 12, 1994, NPI sold one-third of the stock of NPI to Apollo. Apollo
was entitled to designate three of the seven directors of the Managing General
Partner. In addition, the approval of certain major actions on behalf of the
Partnership required the affirmative vote of at least five directors of the
Managing General Partner.
On October 12, 1994, affiliates of Apollo acquired (i) one-third of the stock of
the respective general partners of DeForest Ventures I L.P. ("DeForest I") and
DeForest Ventures II L.P. ("DeForest II") and (ii) an additional equity interest
in NPI-AP (bringing its total equity interest in such entity to one-third).
NPI-AP is the sole limited partner of DeForest II and one of the limited
partners of DeForest I. DeForest I was formed for the purpose of making tender
offers (the "Tender Offers") for limited partnership interests in 12 affiliated
limited partnerships. DeForest II was formed for the purpose of making tender
offers for limited partnership interests in the Partnership as well as the
remaining six partnerships in the National Property Investors Series.
On August 17, 1995, the stockholders of NPI entered into an agreement to sell to
IFGP Corporation, a Delaware corporation, an affiliate of Insignia Financial
Group, Inc., a Delaware corporation ("Insignia"), all of the issued and
outstanding common stock of NPI. The closing of the transactions contemplated
by the above mentioned agreement (the "Closing") occurred on January 19, 1996.
Upon the Closing, the officers and directors of NPI, NPI Equity II and the
Managing General Partner resigned and an affiliate of Insignia caused new
officers and directors of each of those entities to be elected. See "Item 9,
Directors and Executive Officers of the Partnership".
On January 19, 1996, DeForest I and certain of its affiliates sold all of its
interest in the Partnership to Riverside Drive L.L.C. ("Riverside") an affiliate
of Insignia. Pursuant to a Schedule 13-D filed by Riverside with the Securities
and Exchange Commission, Riverside acquired 35,473.17 limited partnership units
or approximately 39.4% of the total limited partnership units of the
Partnership. (See "Item 11, Security Ownership of Certain Beneficial Owners and
Management.")
The Partnership is involved in only one industry segment, as described above.
The Partnership does not engage in any foreign operations or derive revenues
from foreign sources.
There have been, and it is possible there may be other Federal, state and local
legislation and regulations enacted relating to the protection of the
environment. The Partnership is unable to predict the extent, if any, to which
such new legislation or regulations might occur and the degree to which such
existing or new legislation or regulations might adversely affect the property
owned by the Partnership.
The Partnership monitors its property for evidence of pollutants, toxins and
other dangerous substances, including the presence of asbestos. In certain
cases, environmental testing has been performed which resulted in no material
adverse conditions or liabilities. In no case has the Partnership received
notice that it is a potentially responsible party with respect to an
environmental clean up site.
The Partnership has no full time employees. The Managing General Partner is
vested with full authority as to the general management and supervision of the
business and affairs of the Partnership. The Limited Partners have no right to
participate in the management or conduct of such business and affairs. NPI-AP
provides day-to-day management services to the Partnership's residential
investment properties. With respect to the Partnership's commercial property,
which was sold in January 1997, management was performed by an unaffiliated
third party management company.
The business in which the Partnership is engaged is highly competitive, and the
Partnership is not a significant factor in its industry. The remaining
properties compete for rentals not only with similar apartment communities and
commercial property parks, but also with other types of housing and business
centers throughout the urban area. Such competition is primarily on the basis
of location, rents, services, and amenities. In addition, the Partnership
competes with significant numbers of individuals and organizations (including
similar partnerships, real estate investment trusts and financial institutions)
with respect to the sale of improved real properties, primarily on the basis of
the prices and terms of such transactions.
ITEM 2. DESCRIPTION OF PROPERTIES:
The following table sets forth the Partnership's investments in properties:
Date of
Property Purchase Type of Ownership Use
Lakeside Place Apartments 12/80 Fee ownership subject to Residential rental
Houston, Texas first mortgage 734 units
Summerhill Apartments 08/81 Fee ownership subject to Residential rental
Dallas, Texas first mortgage 240 units
Preston Creek Apartments 08/81 Fee ownership subject to Residential rental
Dallas, Texas first mortgage 228 units
Phoenix Business Park 05/82 Fee ownership subject to Office Building
Atlanta, Georgia (1) first mortgage 111,000 sq. ft.
(1) Property was sold in January, 1997.
SCHEDULE OF PROPERTIES:
(Dollar amounts in thousands)
Carrying Accumulated Federal
Property Value Depreciation Rate Method Tax Basis
Lakeside Place $ 30,165 $ 13,811 5-30 yrs. SL $ 17,512
Summerhill 7,902 3,600 5-30 yrs. SL 1,769
Preston Creek 9,122 3,466 5-30 yrs. SL 2,549
Phoenix Business Park 8,334 3,286 5-30 yrs. SL 2,979
$ 55,523 $ 24,163 $ 24,809
See "Note A" of the consolidated financial statements included in "Item 7,
Financial Statements" for a description of the Partnership's depreciation
policy.
SCHEDULE OF MORTGAGES:
(Dollar amounts in thousands)
Principal Principal
Balance At Balance
December 31, Interest Period Maturity Due At
Property 1996 Rate Amortized Date Maturity
Lakeside Place $14,636 9.6% 30 yrs. 7/01/01 $14,029
Summerhill 2,930 9.0% 13 yrs. 12/1/08 --
Preston Creek 4,500 7.33% (1) 11/1/03 4,500
Phoenix Business Park 2,578 (2) (2) (2) (2)
$24,644
(1) Monthly payments are interest only.
(2) Mortgage was paid in full in connection with the sale of the property in
January, 1997. As such, the related information for this table is not
revelant.
SCHEDULE OF RENTAL RATES AND OCCUPANCY:
Average Annual Average
Rental Rates Occupancy
Property 1996 1995 1996 1995
Lakeside Place $ 7,684/unit $ 7,537/unit 93% 94%
Summerhill 5,624/unit 5,296/unit 93% 96%
Preston Creek 7,499/unit 7,072/unit 96% 97%
As Phoenix Business Park was sold in January 1997, the related information for
this table is not relevant.
As noted under "Item 1, Description of Business", the real estate industry is
highly competitive. All of the properties of the Partnership are subject to
competition from other apartment complexes in the area. The General Partner
believes that all of the properties are adequately insured. The multi-family
residential properties' lease terms are for one year or less. No individual
residential property tenant leases 10% or more of the available rental space.
Real estate taxes (in thousands) and rates in 1996 for each property were:
1996 1996
Billing Rate
Lakeside Place Apartments $ 544 2.76%
Summerhill Apartments 108 2.72
Preston Creek Apartments 191 2.59
Phoenix Business Park 66 4.15
ITEM 3. LEGAL PROCEEDINGS
The Partnership is unaware of any pending or outstanding litigation that is not
of a routine in nature. The Managing General Partner of the Partnership
believes that all such pending or outstanding litigation will be resolved
without a material adverse effect upon the business, financial condition, or
operations of the Partnership.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The unit holders of the Partnership did not vote on any matter during the fiscal
year covered by this report.
PART II
ITEM 5. MARKET FOR THE PARTNERSHIP'S COMMON EQUITY AND RELATED SECURITY HOLDER
MATTERS
The Partnership, a publicly-held limited partnership, sold 89,980 Limited
Partnership Units aggregating $89,980,000. The Partnership currently has 89,980
units outstanding and 5,539 Limited Partners of record. There is no intention to
sell additional Limited Partnership Units nor is there an established market for
these units.
During the year ended December 31, 1996, the Partnership distributed
approximately $5,419,000 ($60.23 per limited partnership unit) to the limited
partners and $111,000 to the general partners, representing proceeds from sales.
During the year ended December 31, 1995, the Partnership distributed $6,299,000
($70.00 per limited partnership unit) to the limited partners and $128,000 to
the general partners, representing proceeds from sales. The Managing General
Partner plans to make a distribution of the proceeds from the sale of Phoenix
Business Park in the first half of 1997.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This item should be read in conjunction with the consolidated financial
statements and other items contained elsewhere in this report.
Results of Operations
The Partnership's net loss for the year ended December 31, 1996, was
approximately $1,642,000 versus net income of approximately $9,192,000 for the
year ended December 31, 1995. The decrease in income is primarily attributable
to an $11,484,000 gain on the sales of Plumtree Apartments, which occurred on
April 12, 1995, and Farmers Lane Plaza, which occurred on December 29, 1995,
versus a net gain of only $626,000 in 1996, including a gain on the sale of
Northbank Office Complex of $881,000 and an additional loss of $255,000 due to
additional costs related to the sale of Farmers Lane Plaza.
The Partnership experienced an overall decrease in expenses which can be
attributed to the sale of Plumtree Apartments, Farmer's Lane Plaza, and
Northbank Office Complex. The remaining residential rental properties have
experienced improved operations with the exception of Lakeside Place. In 1996,
Lakeside Place had some non-recurring maintenance expenses related to the
improvement of the appearance of the grounds and the exteriors of the buildings
at the property. Included in operating expense for the Partnership is
approximately $966,000 of major repairs and maintenance comprised primarily of
landscaping, gutters, exterior and interior building repairs, parking lot
repairs and exterior painting, the majority of which were for Lakeside Place.
Phoenix Business Park had improved operations for the year ended December 31,
1996, versus the corresponding period in 1995. This improvement can be
partially attributed to space expansion by an existing tenant. Also
contributing to the improved operations is, at December 31, 1996, Phoenix
Business Park was 100% occupied. General and administrative expense increased
for the year ended December 31, 1996, as compared to the year ended December 31,
1995, due to increases in professional fees including accounting services and
legal fees.
On February 1, 1996, the Partnership sold Northbank Office Complex, located in
Eugene, Oregon to an unaffiliated third party for $4,605,000. After payment of
the mortgage totaling approximately $2,443,000 and closing expenses of
approximately $170,000, the net proceeds received by the Partnership were
approximately $1,992,000. The carrying value of the investment property at the
time of the sale was approximately $3,472,000. For financial statement purposes,
the sale resulted in a gain on disposal of property of approximately $881,000
and an extraordinary loss on early extinguishment of debt of approximately
$96,000.
On April 12, 1995, an affiliate of the Partnership's joint venture partner in
Plumtree Apartments acquired, pursuant to a right of first refusal, Plumtree
Apartments for $12,500,000. After repayment of existing loans of $4,595,000, a
prepayment premium of $42,000 and closing expenses of $113,000, net proceeds
received by the joint venture were $7,750,000. The Partnership retained
$6,229,000 of the $7,750,000 proceeds in accordance with the joint venture
agreement. For financial statement purposes, the sale resulted in a gain of
$7,866,000.
On December 29, 1995, the Partnership sold Farmers Lane Plaza, located in Santa
Rosa, California to an unaffiliated third party for $8,750,000. Net proceeds to
the Partnership after payment of closing costs and existing debt were
approximately $3,995,000. The sale resulted in a gain of $3,618,000.
Subsequent to the closing, the Partnership paid $255,000 in additional costs in
connection with the sale.
In connection with the sales of Plumtree Apartments and Farmers Lane Plaza in
1995, and the repayment of the related outstanding debt, the Partnership
recognized an extraordinary loss on extinguishment of debt of $720,000,
consisting of the write-off of unamortized discounts, deferred loan costs and
prepayment premiums.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of its investment properties to
assess the feasibility of increasing rents, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expenses. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level. However, due to changing market
conditions, which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
Managing General Partner will be able to sustain such a plan.
Liquidity and Capital Resources
At December 31, 1996, the Partnership had unrestricted cash of approximately
$999,000 compared to approximately $5,008,000 at December 31, 1995. Net cash
provided by operating activities decreased as a result of the sale of two
properties in 1995 and the sale of Northbank Office Complex in 1996 as discussed
above. In addition, the Partnership paid deferred costs for leasing commissions
in connection with leasing additional space at Phoenix Business Park. Net cash
provided by investing activities decreased due to a decrease in the proceeds
from the sale of properties. Net cash used in financing activities decreased
due to the payoff of two mortgage notes in 1995 related to the sales while only
one has been paid-off in 1996. The mortgage encumbering Preston Creek was
refinanced in 1996. Also, in 1995, an increased amount of cash was distributed
to the limited partners.
On November 1, 1996, the Partnership refinanced the mortgage encumbering Preston
Creek Apartments with a new first mortgage in the amount of $4,500,000. The new
mortgage carries a stated interest rate of 7.33% and matures on November 1,
2003, with a balloon payment of $4,500,000. Total capitalized loan costs were
approximately $125,000. The early extinguishment of debt resulted in an
extraordinary loss of approximately $899,000, arising from prepayment penalties
of approximately $74,000 and unamortized debt discount of approximately
$825,000.
Subsequent to December 31, 1996, the Partnership sold Phoenix Business Park to
an unrelated third party. The sale was completed on January 15, 1997, at a
contract price of $5,600,000. The Partnership received net proceeds of
approximately $2,314,000.
An affiliate of the Managing General Partner has made available to the
Partnership a credit line of up to $150,000 per property owned by the
Partnership. The Partnership has no outstanding amounts due under this line of
credit. Based on present plans, the Managing General Partner does not
anticipate the need to borrow in the near future. Other than cash and cash
equivalents the line of credit is the Partnership's only unused source of
liquidity.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the Partnership. The
mortgage indebtedness of $24,644,000 is amortized over varying periods with
maturity dates from July 2001 to December 2008. The Partnership distributed
approximately $5,530,000 to the partners during the year ended December 31,
1996, and approximately $6,427,000 to the partners during the year ended
December 31, 1995. The Managing General Partner plans to make a distribution of
the proceeds from the sale of Phoenix Business Park in the first half of 1997.
ITEM 7. FINANCIAL STATEMENTS
CENTURY PROPERTIES FUND XV
LIST OF CONSOLIDATED FINANCIAL STATEMENTS
Independent Auditors' Report
Consolidated Balance Sheet - December 31, 1996
Consolidated Statements of Operations - Years ended December 31, 1996 and
1995
Consolidated Statements of Changes in Partners' Capital (Deficit) - Years
ended December 31, 1996 and 1995
Consolidated Statements of Cash Flows - Years ended December 31, 1996 and
1995
Notes to Consolidated Financial Statements
Independent Auditors' Report
To The Partners
Century Properties Income Fund XV
Greenville, South Carolina
We have audited the accompanying consolidated balance sheet of Century
Properties Fund XV (a limited parntership)(the "Partnership") and its
subsidiaries as of December 31, 1996, and the related consolidated statements of
operations, partners' equity and cash flows for each of the two years in the
period ended December 31, 1996. These consolidated financial statements are the
responsibility of the Partnership's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by the Partnership's management, as well as
evaluating the overall consolidated financial statement presentation. We
believe that out audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Century
Properties Fund XV and its subsidiaries as of December 31, 1996, and the results
of its operations and its cash flows for each of the two years in the period
ended December 31, 1996, in conformity with generally accepted accounting
principles.
/s/Imowitz Koenig & Co., LLP
New York, New York
February 5, 1997
CENTURY PROPERTIES FUND XV
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
December 31, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Cash and cash equivalents $ 999
Deferred costs, net 628
Other assets 1,459
Investment properties:
Land $ 7,511
Buildings and related personal property 48,012
55,523
Less accumulated depreciation (24,163) 31,360
$ 34,446
Liabilities and Partners' Capital (Deficit)
Liabilities
Accrued expenses and other liabilities $ 1,266
Mortgages payable 24,644
Partners' Capital (Deficit):
Limited partners (89,980 units issued and
outstanding) $ 9,661
General partners (1,125) 8,536
$ 34,446
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
Years Ended December 31,
1996 1995
Revenues:
Rental income $ 9,478 $ 11,430
Interest income 73 130
Gain on sale of property 626 11,484
Total revenues 10,177 23,044
Expenses:
Operating 6,217 6,190
Interest 2,430 3,603
Depreciation 1,892 2,250
General and administrative 285 221
Total expenses 10,824 12,264
(Loss) income before extraordinary item and
minority interest in joint venture operations (647) 10,780
Minority interest in joint venture operations -- (868)
Loss) income before extraordinary item (647) 9,912
Extraordinary item - loss on early
extinguishment of debt (995) (720)
Net (loss) income $ (1,642) $ 9,192
Net income allocated to general partner $ 1 $ 388
Net (loss) income allocated to limited partners (1,643) 8,804
Net (loss) income $ (1,642) $ 9,192
Net (loss) income per limited partnership unit:
(Loss) income before extraordinary item $ (7.42) $ 105.69
Extraordinary item (10.84) (7.85)
Net (loss) income $ (18.26) $ 97.84
Distribution per limited partnership unit $ 60.23 $ 70.00
See Accompanying Notes to Consolidated Financial Statements
CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(in thousands, except unit data)
Limited
Partnership General Limited
Units Partners Partners Total
Original Capital contributions 89,980 $ -- $ 89,980 $ 89,980
Partners' (deficit) capital at
December 31, 1994 89,980 $ (1,275)$ 14,218 $ 12,943
Distributions paid -- (128) (6,299) (6,427)
Net income for the year
ended December 31,1995 -- 388 8,804 9,192
Partners' (deficit) capital
at December 31, 1995 89,980 (1,015) 16,723 15,708
Distributions paid -- (111) (5,419) (5,530)
Net income (loss) for the year
ended December 31, 1996 -- 1 (1,643) (1,642)
Partners' (deficit) capital
at December 31, 1996 89,980 $ (1,125)$ 9,661 $ 8,536
See Accompanying Notes to Consolidated Financial Statements
CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Years Ended December 31,
1996 1995
Cash flows from operating activities:
Net (loss) income $ (1,642) $ 9,192
Adjustments to reconcile net (loss) income to
net cash provided by operating activities:
Depreciation 1,892 2,250
Amortization of loan costs and leasing
commissions 178 531
Minority interest in joint venture operations -- 868
Gain on sale of property (626) (11,484)
Extraordinary loss on extinguishment of debt 995 720
Change in accounts:
Deferred costs (147) (122)
Other assets 298 (379)
Accrued expenses and other liabilities (32) (140)
Net cash provided by
operating activities 916 1,436
Cash flows from investing activities:
Property improvements and replacements (1,269) (1,457)
Net proceeds from the sale of rental properties 4,154 20,875
Net cash provided by investing activities 2,885 19,418
Cash flows from financing activities:
Satisfaction of mortgage notes payable (6,143) (11,121)
Payments on mortgage principal (438) (608)
Proceeds from notes payable 4,500 2,443
Debt extinguishment costs (74) --
Financing costs paid (125) (99)
Cash distributions to partners (5,530) (6,427)
Joint venture partner distributions -- (1,640)
Net cash used in financing activities (7,810) (17,452)
Net (decrease) increase in cash and
cash equivalents (4,009) 3,402
Cash and cash equivalents at beginning of year 5,008 1,606
Cash and cash equivalents at end of year $ 999 $ 5,008
Supplemental disclosure of cash flow:
Cash paid for interest $ 2,253 $ 3,600
Supplemental disclosure of non cash investing and
financing activities:
Property sale expenses accrued $ -- $ 91
Disposition of rental properties. See "Note E"
See Accompanying Notes to Consolidated Financial Statements
CENTURY PROPERTIES FUND XV
Notes to Consolidated Financial Statements
December 31, 1996
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Organization:
Century Properties Fund XV (the "Partnership") is a limited partnership
organized under the laws of the State of California to acquire, hold for
investment, and ultimately sell income-producing real estate. The Partnership
currently owns three residential apartment complexes located in Texas.
Subsequent to December 31, 1996, the Partnership sold its office complex located
in Georgia. The Managing General Partner is Fox Capital Management Corporation
("FCMC" or the "Managing General Partner"). Fox Realty Investors ("FRI"), a
California general partnership, is the co-general partner. The Partnership was
organized in May 1980. Capital contributions of $89,980,000 ($1,000 per unit)
were made by the limited partners.
Principles of Consolidation:
The financial statements include all the accounts of the Partnership and
its majority owned Partnerships. All significant interpartnership balances have
been eliminated. Minority interest is not material and is not shown separately
in the financial statements.
Cash and Cash Equivalents:
The Partnership considers all highly liquid investments with a maturity,
when purchased, of three months or less to be cash equivalents. At certain
times, the amount of cash deposited at a bank may exceed the limit on insured
deposits.
Investment Properties:
In 1995, the Partnership adopted Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of", which requires impairment losses to be
recorded on long-lived assets used in operations when indicators of impairment
are present and the undiscounted cash flows estimated to be generated by those
assets are less than the assets' carrying amount. The impairment loss is
measured by comparing the fair value of the asset to its carrying amount. The
effect of adoption was not material.
Depreciation:
Depreciation is calculated by the straight-line method over the estimated lives
of the rental properties and related personal property ranging from 5 to 40
years.
Leases and Lease Commissions:
The Partnership generally leases apartment units for twelve-month terms or less.
The Partnership leases certain commercial space to tenants under various lease
terms. The Partnership recognizes income as earned on its leases.
Deferred lease commissions on commercial space are amortized using the straight-
line method over the lives of the related leases. Such amortization is charged
to operating expenses. Unamortized lease commissions are included in deferred
costs. At December 31, 1996, accumulated amortization of lease commissions
totaled $88,000.
Loan Costs:
Loan costs of $676,000 are included in "Deferred costs, net" in the accompanying
consolidated balance sheet and are being amortized on a straight-line basis over
the life of the loan. At December 31, 1996, accumulated amortization is
$221,000. Amortization of loan costs is included in interest expense.
Income Taxes:
Taxable income or loss of the Partnership is reported in the income tax returns
of its partners. No provision for income taxes is made in the consolidated
financial statements of the Partnership.
Fair Value:
In 1995, the Partnership implemented "Statement of Financial Accounting
Standards No. 107, Disclosure about Fair Value of Financial Instruments," which
requires disclosure of fair value information about financial instruments for
which it is practicable to estimate that value. The carrying amount of the
Partnership's cash and cash equivalents approximates fair value due to short-
term maturities. The Partnership estimates the fair value of its fixed rate
mortgage by discounted cash flow analysis, based on estimated borrowing rates
currently available to the Partnership ("Note C"). The fair value of the fixed
rate mortgages is approximately $26,209,000 at December 31, 1996, versus a
carrying value of $24,644,000.
Net Income (Loss) Per Weighted Average limited partnership Unit:
Net income (loss) per Limited Partnership Unit is computed by dividing net
income (loss) allocated to the limited partners by 89,980 units outstanding.
Use of Estimates:
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
Reclassifications:
Certain reclassifications have been made to the 1995 balances to conform to the
1996 presentation.
NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership Agreement provides for payments to
affiliates for services and as reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership.
Pursuant to a series of transactions which closed during the first half of 1996,
affiliates of Insignia Financial Group, Inc. ("Insignia") acquired (i) control
of NPI Equity Investments II, Inc. ("NPI Equity"), the managing general partner
of FRI, and (ii) all of the issued and outstanding shares of stock of FCMC. NPI
Equity is a wholly-owned subsidiary of National Property Investors, Inc.
("NPI"). In connection with these transactions, affiliates of Insignia appointed
new officers and directors of NPI Equity and FCMC.
The following transactions with affiliates of Insignia, NPI, and affiliates of
NPI were incurred in 1996 and 1995 (in thousands):
For the Years Ended
December 31,
1996 1995
Property management fees (included in operating
expenses) $ 415 $ 399
Reimbursement for services of affiliates (included
in investment properties, operating expenses and
general and administrative expenses) 165 152
The reimbursement for services of affiliates for the year ended December 31,
1996, includes approximately $22,000 for construction-related services.
In connection with the refinancing of Preston Creek, an affiliate of the
Managing General Partner, received approximately $8,000 in November 1996. This
amount is included in "Deferred costs, net."
On March 29, 1996, an affiliate of Insignia acquired the corporate general
partners owning 1% of the subsidiary partnership which owns Summerhill
Apartments.
For the period from January 19, 1996, to December 31, 1996, the Partnership
insured its properties under a master policy through an agency and insurer
unaffiliated with the Managing General Partner. An affiliate of the Managing
General Partner acquired, in the acquisition of a business, certain financial
obligations from an insurance agency which was later acquired by the agent who
placed the current year's master policy. The current agent assumed the
financial obligations to the affiliate of the Managing General Partner who
received payments on these obligations from the agent. The amount of the
Partnership's insurance premiums accruing to the benefit of the affiliate of the
Managing General Partner by virtue of the agent's obligations is not
significant.
During the year ended December 31, 1995, an affiliate of NPI was paid $57,000
relating to successful real estate tax appeals on the Partnership's investment
properties. This fee is included in operating expenses.
Approximately $259,000 of insurance premiums which were paid to an affiliate of
NPI under a master insurance policy arranged for by such affiliate, and are
included in operating expenses for the year ended December 31, 1995.
In accordance with the partnership agreement, the general partners were
allocated their two percent continuing interest in the Partnership's net income
(loss) and taxable income (loss). Gains from dispositions of the Partnership's
properties were allocated first to the general partners, to the extent of
distributions received or they were entitled to receive, then two percent of the
remainder. Also in accordance with the Partnership Agreement, the general
partners received distributions of $111,000 and $128,000 in 1996 and 1995,
respectively.
NOTE C - MORTGAGES PAYABLE
(Dollar amounts in thousands)
The principle terms of mortgages payable are as follows:
Monthly Principal Principal
Payment Stated Balance Balance At
Including Interest Maturity Due At December 31,
Property Interest Rate Date Maturity 1996
Lakeside Place $ 126 9.60% 7/01/01 $ 14,029 $ 14,636
Summerhill 33 9.00% 12/1/08 -- 2,930
Preston Creek 27 7.33% 11/01/03 4,500 4,500
Phoenix Business Park (1) (1) (1) (1) 2,578
Total $ 24,644
(1) Mortgage was paid in full in January, 1997, in conjunction with the sale
of the property ("Note I").
Scheduled principal payments of the mortgages payable subsequent to December 31,
1996, are as follows:
1997 $ 2,835
1998 282
1999 309
2000 339
2001 14,316
Thereafter 6,563
$ 24,644
NOTE D - INVESTMENT PROPERTIES AND ACCUMULATED DEPRECIATION
(Dollar amounts in thousands)
Initial Cost
To Partnership
Cost
Buildings Capitalized
and Related (Removed)
Personal Subsequent to
Description Encumbrances Land Property Acquisition
SUBSIDIARIES:
Lakeside Place $ 14,636 $ 3,659 $ 21,481 $ 5,025
Summerhill 2,930 1,003 6,069 830
PARTNERSHIP:
Preston Creek 4,500 2,118 5,793 1,211
Phoenix Business Park 2,578 746 5,176 2,412
Total $ 24,644 $ 7,526 $ 38,519 $ 9,478
Gross Amount at Which Carried
At December 31, 1996
Buildings Accum- Year Depre-
And Related lated of ciable
Personal Depre- Const- Life-
Description Land Property Total ciation ion Years
SUBSIDIARIES:
Lakeside Place $ 3,659 $ 26,506 $ 30,165 $ 13,811 10/76 5-30 yrs.
Summerhill 999 6,903 7,902 3,600 9/79 5-30 yrs.
PARTNERSHIP:
Preston Creek 2,107 7,015 9,122 3,466 10/79 5-30 yrs.
Phoenix Business Park 746 7,588 8,334 3,286 6/80 5-39 yrs.
$ 7,511 $ 48,012 $ 55,523 $ 24,163
Reconciliation of Investment Properties and Accumulated Depreciation:
December 31,
1996 1995
Investment Properties
Balance at beginning of year $59,945 $74,737
Property improvements 1,269 1,457
Disposals of property (5,691) (16,249)
Balance at end of year $55,523 $59,945
December 31,
1996 1995
Accumulated Depreciation
Balance at beginning of year $24,490 $29,112
Additions charged to expense 1,892 2,250
Disposals of property (2,219) (6,872)
Balance at end of year $24,163 $24,490
The aggregate cost of the real estate for Federal income tax purposes at
December 31, 1996 and 1995, is $62,974,000 and $68,411,000. The accumulated
depreciation taken for Federal income tax purposes at December 31, 1996 and
1995, is $38,165,000 and $41,204,000.
NOTE E - DISPOSITION OF RENTAL PROPERTIES
On February 1, 1996, the Partnership sold Northbank Office Complex, located in
Eugene, Oregon, to an unaffiliated third party for $4,605,000. After payment of
the mortgage totaling approximately $2,443,000 and closing expenses of
approximately $170,000, the net proceeds received by the Partnership were
approximately $1,992,000. The carrying value of the investment property at the
time of the sale was approximately $3,472,000. For financial statement purposes,
the sale resulted in a gain on disposal of property of approximately $881,000
and an extraordinary loss on early extinguishment of debt of approximately
$96,000.
On April 12, 1995, an affiliate of the Partnership's joint venture partner in
Plumtree Apartments acquired, pursuant to a right of first refusal, Plumtree
Apartments for $12,500,000. After repayment of existing loans of $4,595,000, a
prepayment premium of $42,000 and closing expenses of $113,000, net proceeds
received by the joint venture were $7,750,000. The Partnership retained
$6,229,000 of the $7,750,000 proceeds in accordance with the joint venture
agreement. For financial statement purposes, the sale resulted in a gain of
$7,866,000.
On December 29, 1995, the Partnership sold Farmers Lane Plaza, located in Santa
Rosa, California, to an unaffiliated third party for $8,750,000. Net proceeds
to the Partnership after payment of closing costs and existing debt were
approximately $3,995,000. The sale resulted in a gain of $3,618,000.
Subsequent to the closing, the Partnership paid $255,000 in additional costs in
connection with the sale.
In connection with the sale of properties and the repayment of the related
outstanding debt, the Partnership recognized an extraordinary loss on
extinguishment of debt in 1995 of $720,000, consisting of the write-off of
unamortized discounts, deferred loan costs and prepayment premiums.
NOTE F - REFINANCING AND EXTRAORDINARY LOSS
On November 1, 1996, the Partnership refinanced the mortgage encumbering Preston
Creek Apartments with a new first mortgage in the amount of $4,500,000. The new
mortgage carries a stated interest rate of 7.33% and matures on November 1,
2003, with a balloon payment of $4,500,000. Total capitalized loan costs were
approximately $125,000. The early extinguishment of debt resulted in an
extraordinary loss of approximately $899,000, arising from prepayment penalties
of approximately $74,000 and unamortized debt discount of approximately
$825,000.
NOTE G - DISTRIBUTIONS
During the year ended December 31, 1996, the Partnership distributed
approximately $5,419,000 ($60.23 per limited partnership unit) to the limited
partners and $111,000 to the general partners.
During the year ended December 31, 1995, the Partnership distributed $6,299,000
($70.00 per limited partnership unit) to the limited partners and $128,000 to
the general partners.
NOTE H - INCOME TAXES
Differences between the net income (loss) as reported and Federal taxable loss
result primarily from (1) depreciation over different methods and lives and on
differing cost bases and (2) change in rental income received in advance. The
following is a reconciliation of reported net loss and Federal taxable loss (in
thousands, except unit data):
For the year ended December 31,
1996 1995
Net (loss) income as reported $(1,642) $ 9,192
Add (deduct):
Depreciation (252) (935)
Gain on property dispositions, net 1,909 3,510
Unearned revenue 30 (4)
Amortization of notes payable
discount 893 347
Minority interest -- (1,873)
Other 38 (80)
Net (loss) income-income tax method $ 976 $ 10,157
Taxable (loss) income per limited
partnership unit $ 10 $ 118
The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of partners' equity (in thousands):
1996
Partners' equity as reported $ 8,536
Depreciation (14,002)
Sales commission and organization expenses 10,322
Payments credited to rental properties 81
Unearned revenue 28
Amortization of notes payable discount 7,312
Other 81
Partners' equity-income tax method $ 12,358
NOTE I - SUBSEQUENT EVENT
Subsequent to December 31, 1996, the Partnership sold Phoenix Business Park to
an unrelated third party for a contract price of $5,600,000. After payment of
the mortgage payable, closing costs and related expense of approximately
$227,000, the Partnership received proceeds of approximately $2,314,000. A gain
of approximately $1,000 will be recognized in 1997 on disposition of the
property. A loss on early extinguishment of debt of approximately $233,000 will
be recognized in 1997.
NOTE J - PRO FORMA FINANCIAL INFORMATION
The following pro forma consolidated balance sheet as of December 31, 1996, and
the pro forma consolidated statement of operations for the year ended December
31, 1996, give effect to the sale of Phoenix Business Park. The adjustments
related to the pro forma consolidated balance sheet assume the transaction was
consummated at December 31, 1996, while the adjustments to the pro forma
consolidated income statements assume the transaction was consummated at the
beginning of the year presented. The sale occurred on January 15, 1997.
The pro forma adjustments required are to eliminate the assets, liabilities and
operating activity of Phoenix Business Park and to reflect consideration
received for the property.
These pro forma adjustments are not necessarily reflective of the results that
actually would have occurred if the sale had been in effect as of and for the
periods presented or that may be achieved in the future.
PRO FORMA CONSOLIDATED BALANCE SHEET
December 31, 1996
(in thousands)
Pro Forma
Historical Adjustments Pro Forma
Assets
Cash and cash equivalents $ 999 $ 2,314 $ 3,313
Deferred costs, net 628 (195) 433
Other assets 1,459 (2) 1,457
Investment property:
Real estate 55,523 (8,334) 47,189
Accumulated depreciation (24,163) 3,286 (20,877)
Real estate, net 31,360 (5,048) 26,312
$ 34,446 $ (2,931) $ 31,515
Liabilities and Partners' Equity
Liabilities
Accrued expenses and other liabilities $ 1,266 $ (53) $ 1,213
Mortgages payable 24,644 (2,578) 22,066
25,910 (2,631) 23,279
Partners' Capital 8,536 (300) 8,236
$ 34,446 $ (2,931) $ 31,515
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the twelve months ended December 31, 1996
(in thousands, except unit data)
Pro Forma
Historical Adjustments Pro Forma
Revenues:
Rental income $ 9,478 $ (1,011) $ 8,467
Interest income 73 (10) 63
Gain on sale of property 626 -- 626
Total revenues 10,177 (1,021) 9,156
Expenses:
Operating 6,217 (332) 5,885
Interest 2,430 (235) 2,195
Depreciation 1,892 (395) 1,497
General and administrative 285 -- 285
Total expenses 10,824 (962) 9,862
Loss before extraordinary item (647) (59) (706)
Extraordinary loss on early extinguishment
of debt (995) -- (995)
Net loss $ (1,642) $ (59) $ (1,701)
Net loss per limited partnership unit $ (18.26) $ (0.63) $ (18.89)
The historical information above includes applicable operating results for
the properties sold during 1996, while the pro forma adjustments relate only to
the subsequent sale of Phoenix Business Park.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANT ON ACCOUNTING AND
FINANCIAL DISCLOSURES
There were no disagreements with Imowitz Koenig & Co., LLP regarding the 1996 or
1995 audits of the Partnership's financial statements.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
The Partnership has no officers or directors. Fox Capital Management
Corporation ("FCMC" or the "Managing General Partner"), manages and controls
substantially all of the Partnership's affairs and has general responsibility in
all matters affecting its business.
The names, ages and positions held by executive officers and directors of the
Managing General Partner, as of December 31, 1996, are as follows:
Name Age Position
William H. Jarrard, Jr. 50 President and Director
Ronald Uretta 41 Vice President and
Treasurer
John K. Lines 37 Vice President and
Secretary
Kelley M. Buechler 39 Assistant Secretary
William H. Jarrard, Jr. has been President and Director of the Managing General
Partner since June 1996 and Managing Director - Partnership Administration of
Insignia since January 1991. Mr. Jarrard served as Managing Director -
Partnership Administration and Asset Management from July 1994 to January 1996.
During the five years prior to joining Insignia in 1991, he served in similar
capacities for U. S. Shelter.
Ronald Uretta has been Vice President and Treasurer of the Managing General
Partner since June 1996 and Insignia's Chief Operating Officer since August
1996. From January 1992 to August 1996, Mr. Uretta was Insignia's Chief
Financial Officer. Mr. Uretta was Insignia's Secretary from January 1992 to
June 1994. From May 1988 until September 1990, Mr. Uretta was a self-employed
financial consultant. From January 1978 until January 1988, Mr. Uretta was
employed by Veltri Raynor & Company, independent certified public accountants.
John K. Lines has been Vice President and Secretary of the Managing General
Partner since June 1996, Insignia's General Counsel since June 1994, and General
Counsel and Secretary since July 1994. From May 1993 until June 1994, Mr. Lines
was the Assistant General Counsel and Vice President of Ocwen Financial
Corporation, West Palm Beach, Florida. From October 1991 until May 1993, Mr.
Lines was a Senior Attorney with BANC ONE CORPORATION, Columbus, Ohio. From May
1984 until October 1991, Mr. Lines was an attorney with Squire Sanders &
Dempsey, Columbus, Ohio.
Kelley M. Buechler has been Assistant Secretary of the Managing General Partner
since June 1996. Ms. Buechler has been Assistant Secretary of Insignia since
1991. During the five years prior to joining Insignia in 1991, she served in
similar capacities for U. S. Shelter.
No family relationships exist among any of the officers or directors of the
Managing General Partner.
ITEM 10. EXECUTIVE COMPENSATION
The Partnership is not required to and did not pay any compensation to the
officers or directors of the Managing General Partner. The Managing General
Partner does not presently pay any compensation to any of its officers or
directors. (See "Item 12, Certain Relationships and Related Transactions").
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The Partnership is a limited partnership and has no officers or directors. The
Managing General Partner has discretionary control over most of the decisions
made by or for the Partnership in accordance with the terms of the Partnership
Agreement.
The following table sets forth certain information regarding limited partnership
units of the Partnership owned by each person who is known by the Partnership to
own beneficially or exercise voting or dispositive control over more than 5% of
the Partnership's limited partnership units, by each of the Managing General
Partner's directors and by all directors and executive officers of the Managing
General Partner as a group as of December 31, 1996.
Name and address of Amount and nature of
Beneficial Owner Beneficial Owner % of Class
Riverside Drive LLC 35,473.17 39.4%
All directors and
executive officers as
a group -- --
There are no arrangements known to the Partnership, the operation of which may,
at a subsequent date, result in a change in control of the Partnership.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership Agreement provides for payments to
affiliates for services and as reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership.
National Property Investors, Inc. ("NPI") is the parent company of the Managing
General Partner. On January 19, 1996, an affiliate of Insignia Financial Group,
Inc. ("Insignia") acquired all of the issued and outstanding stock of NPI.
The following transactions with affiliates of Insignia, NPI, and affiliates of
NPI were incurred in 1996 and 1995 (in thousands):
For the Years Ended
December 31,
1996 1995
Property management fees (included in operating
expenses) $ 415 $ 399
Reimbursement for services of affiliates (included
in investment properties, operating expenses and
general and administrative expenses) 165 152
The reimbursement for services of affiliates for the year ended December 31,
1996, includes approximately $22,000 for construction-related services.
For the period from January 19, 1996, to December 31, 1996, the Partnership
insured its properties under a master policy through an agency and insurer
unaffiliated with the Managing General Partner. An affiliate of the Managing
General Partner acquired, in the acquisition of a business, certain financial
obligations from an insurance agency which was later acquired by the agent who
placed the current year's master policy. The current agent assumed the
financial obligations to the affiliate of the Managing General Partner who
received payments on these obligations from the agent. The amount of the
Partnership's insurance premiums accruing to the benefit of the affiliate of the
Managing General Partner by virtue of the agent's obligations is not
significant.
During the year ended December 31, 1995, an affiliate of NPI was paid $57,000
relating to successful real estate tax appeals on the Partnership's investment
properties. This fee is included in operating expenses.
Approximately $259,000 of insurance premiums which were paid to an affiliate of
NPI, Inc. under a master insurance policy arranged for by such affiliate, are
included in operating expenses for the year ended December 31, 1995.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) See Exhibit Index contained herein.
(b) Reports on Form 8-K filed during the fourth quarter of 1996: None.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Partnership has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
CENTURY PROPERTIES FUND XV
By: FOX CAPITAL MANAGEMENT CORPORATION,
Managing General Partner
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
Date: March 28, 1997
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Partnership and
in the capacities and on the dates indicated.
Signature/Title Title Date
/s/William H. Jarrard, Jr. President and March 28, 1997
William H. Jarrard, Jr. Director
/s/Ronald Uretta Vice President and March 28, 1997
Ronald Uretta Treasurer
CENTURY PROPERTIES INCOME FUND XV
EXHIBIT INDEX
Exhibit Number Description of Exhibit
2.1 NPI, Inc. Stock Purchase Agreement, dated as of
August 17, 1995, incorporated by reference to the
Partnership's Current Report on Form 8-K dated August
17, 1995.
2.2 Partnership Units Purchase Agreement dated as of
August 17, 1995 incorporated by reference to Exhibit
2.1 to Form 8-K filed by Insignia Financial Group,
Inc. ("Insignia") with the Securities and Exchange
Commission on September 1, 1995.
2.3 Management Purchase Agreement dated as of August 17,
1995 incorporated by reference to Exhibit 2.2 to Form
8-K filed by Insignia with the Securities and
Exchange Commission on September 1, 1995.
2.4 Limited Liability Company Agreement of Riverside
Drive L.L.C., dated as of August 17, 1995
incorporated by reference to Exhibit 2.4 to Form 8-K
filed by Insignia with the Securities and Exchange
Commission on September 1, 995.
2.5 Master Indemnity Agreement dated as of August 17,
1995 incorporated by reference to Exhibit 2.5 to Form
8-K filed by Insignia with the Securities and
Exchange Commission on September 1, 1995.
3.4 Agreement of Limited Partnership, incorporated by
reference to Exhibit A to the Prospectus of the
Partnership dated September 20, 1983, as amended on
June 13, 1989, and as thereafter supplemented
contained in the Partnership's Registration Statement
on Form S-11 (Reg. No. 2-79007).
10.1 Deed of Trust Note dated June 1, 1994, made by
Century Lakeside Place, L.P. in favor of Value Line
Mortgage Corporation, incorporated by reference to
the Partnership's Form 10-Q for the quarter ended
June 30, 1994.
10.2 Deed of Trust, Security Agreement and Assignment of
Leases and Rents dated June 1, 1994, from Lakeside
Place, L.P. to Jeffrey H. Gelman for the benefit of
Value Line Mortgage Corporation, incorporated by
reference to the Partnership's Form 10-Q for the
quarter ended September 30, 1994.
10.3 Fifth Amendment to Note dated as of September 14,
1994, by and between the Partnership and New York
Life Insurance Company, incorporated by reference to
the Partnership's Form 10-Q for the quarter ended
September 30, 1994.
10.4 Fifth Modification to Deed to Secure Debt and
Security Agreement dated as of September 14, 1994, by
and between the Partnership and New York Life
Insurance Company, incorporated by reference to the
Partnership's Form 10-Q for the quarter ended
September 30, 1994.
10.5 Amended and Restated Assignment of Leases and Rents
dated as of September 14, 1994, by and between the
Partnership and New York Life Insurance Company,
incorporated by reference to the Partnership's Form
10-Q for the quarter ended September 30, 1994.
10.6 Multifamily Note dated November 1, 1996, by and
between the Partnership and Lehman Brothers Holdings,
Inc. for Preston Creek Apartments.
27 Financial Data Schedule.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XV 1996 Year-End 10-KSB and is qualified in its entirety by
reference to such 10-KSB.
</LEGEND>
<CIK> 0000314690
<NAME> CENTURY PROPERTIES FUND XV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 999
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 55,523
<DEPRECIATION> (24,163)
<TOTAL-ASSETS> 34,446
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 24,644
0
0
<COMMON> 0
<OTHER-SE> 8,536
<TOTAL-LIABILITY-AND-EQUITY> 34,446
<SALES> 0
<TOTAL-REVENUES> 10,177
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 10,824
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,430
<INCOME-PRETAX> (647)
<INCOME-TAX> 0
<INCOME-CONTINUING> (647)
<DISCONTINUED> 0
<EXTRAORDINARY> (995)
<CHANGES> 0
<NET-INCOME> (1,642)
<EPS-PRIMARY> (18.26)<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
</TABLE>
EXHIBIT 10.6
Loan No. 734133553
Preston Creek
MULTIFAMILY NOTE
US $4,500,000.00
New York, New York
As of November 1, 1996
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS HOLDINGS
INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings Inc., 3 World
Financial Center, New York, New York 10285, or order, the principal sum of Four
Million Five Hundred Thousand and 00/100 Dollars, with interest on the unpaid
principal balance from the date of this Note, until paid, at the rate of 7.33
percent per annum. Interest only shall be payable at 3 World Financial Center,
New York, New York 10285, in consecutive monthly installments of Twenty-Seven
Thousand Four Hundred Eighty-Seven and 50/100 Dollars (US $27,487.50) on the
first day of each month beginning December 1, 1996, until the entire
indebtedness evidenced hereby is fully paid, except that any remaining
indebtedness, if not sooner paid, shall be due and payable on November 1, 2003.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default in
the payment of this Note, and if the same is referred to an attorney at law for
collection or any action at law or in equity is brought with respect hereto, the
undersigned shall pay the holder hereof all expenses and costs, including, but
not limited to, attorney's fees.
Prepayments shall be applied against the outstanding principal balance of
this Note and shall not extend or postpone the due date of any subsequent
monthly installments or change the amount of such installments, unless the
holder hereof shall agree otherwise in writing. The holder hereof may require
that any partial prepayments be made on the date monthly installments are due
and be in the amount of that part of one or more monthly installments which
would be applicable to principal.
From time to time, without affecting the obligation of the undersigned or
the successors or assigns of the undersigned to pay the outstanding principal
balance of this Note and observe the covenants of the undersigned contained
herein, without affecting the guaranty of any person, corporation, partnership
or other entity for payment of the outstanding principal balance of this Note,
without giving notice to or obtaining the consent of the undersigned, the
successors or assigns of the undersigned or guarantors, and without liability on
the part of the holder hereof, the holder hereof may, at the option of the
holder hereof, extend the time for payment of said outstanding principal balance
or any part thereof, reduce the payments thereon, release anyone liable on any
of said outstanding principal balance, accept a renewal of this Note, modify the
terms and time of payment of said outstanding principal balance, join in any
extension or subordination agreement, release any security given herefor, take
or release other or additional security, and agree in writing with the
undersigned to modify the rate of interest or period of amortization of this
Note or change the amount of the monthly installments payable hereunder.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the joint
and several obligation of all makers, sureties, guarantors and endorsers, and
shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed of
Trust dated as of the date hereof, and reference is made thereto for rights as
to acceleration of the indebtedness evidenced by this Note. This Note shall be
governed by the law of the jurisdiction in which the Property subject to the
Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder within
ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The term "maximum Rate" shall mean the highest lawful rate of interest
applicable to this Note. In determining the Maximum Rate, due regard shall be
given to all payments, fees, charges, deposits, balances and agreements which
may constitute interest or be deducted from principal when calculating interest.
For purposes of determining the Maximum Rate, the Indicated Rate Ceiling
specified in Texas Revised Civil Statutes, Article 5069-1.04 shall be used;
however, if permitted by law, holder hereof may implement any ceiling under that
law used to compute the rate of interest hereunder by notice to the undersigned
as provided in such article. Notwithstanding the foregoing sentence, if Section
501 of the Depository Institutions Deregulation and Monetary Control Act of 1980
(as amended) permits a higher Maximum Rate than Article 5069-1.04 or applicable
state law, such higher Maximum Rate shall apply to this Note.
Interest on the unpaid principal balance of this Note at the rate stated
above in the first paragraph of the first page of this Note (the "Stated Rate")
shall be calculated at a daily rate equal to 1/360 times the Stated Rate (but in
no event greater than the Maximum Rate). Notwithstanding the foregoing, at any
time when the interest contracted for, collected, or charged on the unpaid
balance of this Note shall exceed the Stated Rate, such interest shall be
calculated at a daily rate of 1/365 times such rate (but in no even greater than
the Maximum Rate).
It is expressly stipulated and agreed to be in the intent of the
undersigned and holder hereof at all times to comply with the applicable law
governing the Maximum Rate or amount of interest payable on or in connection
with this Note and the loan (the "Loan") evidence thereby (or applicable United
States federal law to the extent that it permits holder hereof to contract for,
charge, take, reserve or receive a greater amount of interest than under law of
the state in which the Property is located). If the applicable law is ever
judicially interpreted so as to render usurious any amount called for under this
Note or under the Deed of Trust or any other document (collectively, the
"Security Documents") evidencing, securing or executed in connection with Loan,
or contracted for, charged, taken reserved or received with respect to Loan, or
if acceleration of the maturity of this Note or if any prepayment by the
undersigned results in the undersigned having paid any interest in excess of
that permitted by law, then it is the undersigned's and the holder hereof's
express intent that all excess amounts theretofore collected by the holder
hereof be credited on the principal balance of this Note (or, if this Note have
been or would thereby be paid in full, refunded to the undersigned), and the
provisions of this Note, the Deed of Trust and the other Security Documents
immediately be deemed reformed and the amounts thereafter collectible hereunder
the thereunder reduced, without the necessity of the execution of any new
documents, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder and thereunder.
The right to accelerate maturity of this Note does not include the right to
accelerate any interest which has not otherwise accrued on the date of such
acceleration, and holder hereof does not intend to collect any unearned interest
in the event of acceleration. All sums paid or agreed to be paid to holder
hereof for the use, forbearance or detention of the indebtedness evidenced
hereby shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such indebtedness until payment
in full so that the rate or amount of interest on account of such indebtedness
does not exceed the applicable usury ceiling. Notwithstanding any provision
contained in this Note, the Deed of Trust or in any of the other Security
Documents that permits the compounding of interests, including, without
limitation, any provisions by which any accrued interest is added to the
principal amount of this Note, the total amount of interest that the undersigned
is obligated to pay and the holder hereof is entitled to receive with respect to
this Note shall not exceed the amount calculated on a simple (i.e.
noncompounded) interest basis at the Maximum Rate on principal amounts actually
advanced to or for the account of the undersigned, including all current and
prior advances and any advances made pursuant to the Deed of Trust or other
Security Documents (such as for the payment of taxes, insurance premiums and
similar expenses or costs).
The undersigned and all other markers, signers, sureties, guarantors and
endorsers of this Note waive demand, presentment, notice of dishonor, notice of
intent to demand or accelerate payment hereof, diligence in the collecting,
grace, notice and protest and agree to one or more extensions for any period or
periods of time and partial payments, before or after maturity, without
prejudice to the holder hereof; and if collection procedures are ever commenced,
by any means, including legal proceedings or through a probate or bankruptcy
court, of if this Note is placed in the hands of any attorney for collection
after default or maturity, the undersigned agrees to pay all costs of collection
or attempted collection, including reasonable attorney's fees.
IN WITNESS WHEREOF, Borrower has executed this Note or has caused the same
to be executed by its representatives thereunto duly authorized.
BORROWER: CENTURY PROPERTIES FUND XV,
a California limited partnership
BY: Fox Capital Management Corporation,
a California corporation, its general
partner
BY: /s/William H. Jarrard, Jr.
Name: William H. Jarrard. Jr.
Title: President
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 1st day of November, 1996.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman
Brothers Holdings Inc., a Delaware
Corporation
By:/s/Larry J. Kravetz
Name: Larry J. Kravetz
Title: Authorized Signatory
