FORM 10-Q--QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
(As last amended in Rel. No. 312905, eff. 4/26/93.)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of The Securities Exchange
Act of 1934
For the quarterly period ended September 30, 1996
or
[ ] Transition Report Under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period.........to.........
(Amended by Exch Act Rel No. 312905. eff 4/26/93.)
Commission file number 0-11002
CONSOLIDATED CAPITAL PROPERTIES IV
(Exact name of registrant as specified in its charter)
California 94-2768742
(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)
Registrant's telephone number (864) 239-1000
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X . No .
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
<TABLE>
<CAPTION>
September 30, December31,
1996 1995
(Unaudited) (Note)
<S> <C> <C>
Assets
Cash and cash equivalents:
Unrestricted $ 6,468 $ 10,865
Restricted - tenant security deposits 662 665
Investments 2,612 2,637
Prepaid expenses and other assets 5,985 6,900
Note and interest receivable 1,135 1,155
Investment properties:
Land 12,491 12,868
Buildings and personal property 114,719 112,350
127,210 125,218
Less accumulated depreciation (90,217) (86,294)
36,993 38,924
$ 53,855 $ 61,146
Liabilities and Partners' Deficit
Liabilities
Accounts payable and accrued expenses $ 3,125 $ 3,443
Notes and interest payable 71,691 76,336
74,816 79,779
Partners' Deficit
General partner (6,077) (5,951)
Limited partners (342,783 units
outstanding in 1996 and 1995) (14,884) (12,682)
(20,961) (18,633)
$ 53,855 $ 61,146
Note: The balance sheet at December 31, 1995, has been derived from the audited
financial statements at that date but does not include all the information
and footnotes required by generally accepted accounting principles for
complete financial statements.
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
b) CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Revenues:
Rental income $6,945 $6,653 $20,330 $19,867
Interest and other income 177 140 552 503
Total revenues 7,122 6,793 20,882 20,370
Expenses:
Property operations 3,689 3,482 10,556 9,945
Depreciation and amortization 1,771 1,653 5,229 4,940
Interest 1,542 1,661 4,574 4,954
Administrative 300 428 1,125 1,258
Total expenses 7,302 7,224 21,484 21,097
Loss before
extraordinary items (180) (431) (602) (727)
Extraordinary items:
Gain (loss) on refinancing (81) -- (81) 250
Gain on foreclosure of investment
property -- -- 2,999 --
Net income (loss) $ (261) $ (431) $ 2,316 $ (477)
Net income (loss) allocated to general
partner (4%) $ (10) $ (17) $ 93 $ (19)
Net income (loss) allocated to limited
partners (96%) (251) (414) 2,223 (458)
$ (261) $ (431) $ 2,316 $ (477)
Net income (loss) per weighted average
partnership unit:
Loss before extraordinary
items $ (.50) $(1.21) $ (1.69) $ (2.04)
Extraordinary items (.23) -- 8.17 .70
Net income (loss) per weighted average
limited partnership unit $ (.73) $(1.21) $ 6.48 $ (1.34)
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
c) CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' DEFICIT
(Unaudited)
For the Nine Months Ended September 30, 1996 and 1995
(in thousands, except unit data)
<TABLE>
<CAPTION>
Limited Total
Partnership General Limited Partners'
Units Partner Partners Deficit
<S> <C> <C> <C> <C>
Original capital contributions 343,106 $ 1 $171,553 $171,554
Partners' deficit at
December 31, 1994 342,783 $ (5,866) $(10,649) $(16,515)
Net loss for the nine months
ended September 30, 1995 -- (19) (458) (477)
Distributions to Partners -- (37) (884) (921)
Partners' deficit at
September 30, 1995 342,783 $ (5,922) $(11,991) $(17,913)
Partners' deficit at
December 31, 1995 342,783 $(5,951) $(12,682) $(18,633)
Net income for the nine months
ended September 30, 1996 -- 93 2,223 2,316
Distributions to Partners -- (219) (4,425) (4,644)
Partners' deficit at
September 30, 1996 342,783 $(6,077) $(14,884) $(20,961)
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
d) CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 2,316 $ (477)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
cash provided by operating activities:
Depreciation and amortization 5,438 5,171
Loss on disposition of investment property 36 --
Extraordinary gains on foreclosure or refinancing (2,999) (250)
Extraordinary loss on refinancing 81 --
Change in accounts:
Tenant security deposits (9) --
Prepaid expenses and other assets 540 (548)
Accounts payable and accrued expenses (232) 907
Accrued interest (54) 144
Net cash provided by operating activities 5,117 4,947
Cash flows from investing activities:
Property improvements and replacements (3,859) (1,769)
Purchase of investments -- (7,176)
Proceeds from sale of investments 25 8,882
Deposits to restricted escrows (734) (556)
Receipts from restricted escrows 868 978
Collections on note receivable 29 27
Net cash (used in) provided by investing activities (3,671) 386
Cash flows from financing activities:
Payments on notes payable (382) (560)
Repayment of notes payable (4,726) (5,573)
Proceeds from long-term borrowings 4,050 7,500
Distributions to partners (4,644) (921)
Loan costs paid (141) (361)
Net cash (used in) provided by
financing activities (5,843) 85
Net (decrease) increase in cash and cash equivalents (4,397) 5,418
Cash and cash equivalents at beginning of period 10,865 4,674
Cash and cash equivalents at end of period $ 6,468 $10,092
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)
Supplemental Disclosures of Cash Flow Information and Non-Cash Activities:
Cash paid for interest was approximately $4,403,000 and $4,562,000 for the nine
months ended September 30, 1996 and 1995, respectively.
Foreclosure
During the nine months ended September 30, 1996, Metro Centre Office Building
was foreclosed upon by the lender. In connection with this foreclosure, the
following accounts were adjusted by the amounts noted below.
September 30, 1996
(in thousands)
Tenant security deposits remitted to the lender $ (12)
Prepaid expenses and other assets (5)
Buildings and personal property (1,605)
Accumulated depreciation 1,079
Accounts payable and accrued expenses 24
Interest payable 1,021
Notes payable 2,497
Gain on foreclosure of investment property (2,999)
See Accompanying Notes to Consolidated Financial Statements
e) CONSOLIDATED CAPITAL PROPERTIES IV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements of Consolidated
Capital Properties IV (the "Partnership" or "Registrant") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of ConCap Equities, Inc. (the "General Partner"),
all adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. Operating results for the three and
nine months ended September 30, 1996, are not necessarily indicative of the
results that may be expected for the fiscal year ending December 31, 1996. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Partnership's annual report on Form 10-K for
the fiscal year ended December 31, 1995.
Consolidation
The consolidated financial statements include the Partnership's equity interest
in a joint-venture partnership which owns South Port Apartments. No minority
interest has been reflected for the joint venture partnership because minority
interests are limited to the extent of their equity capital, and losses in
excess of the minority interest equity capital are charged against the
Partnership's interest.
The Partnership's consolidated financial statements include the accounts of its
wholly-owned limited partnerships, certain other majority-owned limited
partnerships and the Partnership's majority interest in a joint venture
partnership. All intercompany transactions have been eliminated.
Presentation of Accounts
Certain reclassifications have been made to the 1995 information to conform to
the 1996 presentation.
Investments
Investments consisting primarily of U.S. Treasury Notes with original maturities
of more than ninety days are considered to be held-to-maturity securities.
NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has paid property management fees based on collected gross
rental revenues for property management services in each of the nine months
ended September 30, 1996 and 1995. In late December 1994, an affiliate of the
General Partner assumed day-to-day property management responsibilities for all
of the Partnerships' properties except Lake Forest, Post Ridge and South Port
Apartments. On February 15, 1995, an affiliate of the General Partner assumed
day-to-day property management responsibilities for Lake Forest and Post Ridge
Apartments. Property management fees of approximately $979,000 and $926,000
were paid to affiliates of the General Partner for the nine months ended
September 30, 1996 and 1995, respectively. These fees are included in
operating expenses.
The Limited Partnership Agreement ("Partnership Agreement") provides for a
special management fee equal to 9% of the total distributions made to the
limited partners from cash flow from operations to be paid to the General
Partner for executive and administrative management services. The Partnership
paid approximately $392,000 and $80,000 under this provision of the Partnership
Agreement to affiliates of the General Partner during the nine months ended
September 30, 1996 and 1995, respectively.
The Partnership Agreement also provides for reimbursement to the General Partner
and its affiliates for costs incurred in connection with the administration of
Partnership activities. Reimbursements for services of affiliates of
approximately $479,000 and $550,000 were paid to the General Partner and
affiliates for the nine months ended September 30, 1996 and 1995, respectively.
During the nine months ended September 30, 1995, the Partnership incurred
approximately $42,000 of expense reimbursements to an affiliate of the General
Partner related to evaluating the feasibility of refinancing the debt on several
of the Partnership's investment properties. During the nine months ended
September 30, 1996, the Partnership paid this affiliate approximately $6,000 of
loan costs which were capitalized and included in Prepaid expenses and other
assets in the accompanying Consolidated Balance Sheet. These loan costs related
primarily to the refinancing of the Post Ridge Apartments (See "Note D").
In July 1995, the Partnership began insuring its properties under a master
policy through an agency and insurer unaffiliated with the General Partner. An
affiliate of the 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 General Partner who
receives payment on these obligations from the agent. The amount of the
Partnership's insurance premiums accruing to the benefit of the affiliate of the
General Partner by virtue of the agent's obligations is not significant.
NOTE C - COMMITMENTS AND CONTINGENCIES
Commitments
The Partnership is required by the Partnership Agreement to maintain working
capital reserves for contingencies. On September 25, 1995, the partners were
proxied and approved a reduction of the capital reserve requirements to $500 per
apartment unit and $1.00 per square foot of gross leasable commercial space
owned by the Partnership, or approximately $2,129,000. Cash and cash
equivalents, tenant security deposits and investments, totalling approximately
$9,742,000 at September 30, 1996, exceeded the Partnership's reserve
requirements of approximately $2,129,000. Such reserves include approximately
$100,000 of cash and cash equivalents designated for use at the Partnership's
U.S. Department of Housing and Urban Development ("HUD") financed property.
Contingencies
Approximately $2.5 million of nonrecourse mortgage debt secured by the Metro
Centre Office Building, located in Southern California, matured July 1, 1995.
The property had historically encountered difficulty making its scheduled debt
service payments. Since 1985, the property had made quarterly cash flow payments
pursuant to a modified and restructured loan agreement, however, no payments
were made in 1995 or 1996. Given current economic conditions in Southern
California, property operations were not expected to improve sufficiently to
enable the Partnership to refinance the existing indebtedness under current
market conditions. In September 1995, a "Notice of Default and Election to Sell
Under Deed of Trust" was filed by the lender. The Partnership did not contest
this foreclosure notice and the property was foreclosed on February 7, 1996,
resulting in a gain on foreclosure of approximately $2,999,000 to the
Partnership.
Lake Forest Apartments secures a HUD-guaranteed mortgage note and accrued
interest totalling approximately $4,149,000 at September 30, 1996.
NOTE D - NOTE REFINANCING
In March of 1995, the General Partner refinanced two nonrecourse mortgage notes
totalling approximately $5.8 million which were secured by the Nob Hill Villa
Apartments. Under the terms of the refinancing agreement, the new $7.5 million
mortgage note bears interest at 9.2% and matures in April 2005. As a result of
the refinancing, the Partnership realized a $250,000 discount on the second
mortgage which resulted in an extraordinary gain on refinancing. Through the
refinancing, a capital improvement reserve of approximately $219,000 was
established and approximately $298,000 in loan costs were incurred. These loan
costs will be amortized over the life of the loan.
In September of 1996, the Partnership entered into an interim financing
arrangement and refinanced the nonrecourse mortgage note of approximately $4.3
million which was secured by Post Ridge Apartments. Under the terms of the
interim financing arrangement, the new $4.1 million mortgage note bears interest
at 8% through October 31, 1996, and from November 1, 1996, through the maturity
date of November 15, 1996, the note shall bear a rate equal to 2.5% plus the
average one month LIBOR. If long term financing is not obtained by the maturity
date of the interim financing arrangement, the borrower may obtain a one-time
extension of the maturity date to December 31, 1996. If the borrower has not
paid the balance of the interim note in full by the original or extended
maturity date the interim note shall be converted to a seven year fixed rate
amortizing loan with an interest rate equal to the semi-annual yield as reported
in The Wall Street Journal on the maturity date for the current U.S. Treasury
Security with a maturity date most closely approximating the date which is seven
years from such date of calculation, plus 2.15%. As a result of the
refinancing, the Partnership realized a $16,000 gain on the forgiveness of
accrued interest, a $61,000 gain on the forgiveness of advances from prior
years, and a $158,000 loss on the write off of loan costs which resulted in a
net extraordinary loss on refinancing of $81,000.
To facilitate the refinancing, effective August 7, 1996, the Post Ridge
Associates, Ltd.'s Limited Partnership Agreement was amended to convert the
general partnership interest held by Consolidated Capital Properties IV ("CCP
IV") to a limited partnership interest, such that CCP IV shall be the sole
Limited Partner owning a 99.0% limited partnership interest in Post Ridge
Associates, Ltd. Concap Equities, Inc. was admitted as the new General Partner
owning a 1.0% general partner interest and PRA, Inc. withdrew as the Limited
Partner of Post Ridge Associates, Ltd.
NOTE E - DISTRIBUTIONS
In March 1996, the General Partner declared and paid distributions attributable
to cash flow from operations totalling approximately $3,617,000 and
approximately $71,000 representing a return of capital. In conjunction with the
transfer of funds from certain majority-owned sub-tier limited partnerships to
the Partnership, approximately $35,000 was distributed to the general partners
of the majority-owned sub-tier limited partnerships. In September 1996, the
General Partner declared and paid distributions attributable to cash flow from
operations totalling approximately $921,000.
NOTE F - NOTE PAYOFF
In February of 1996 the $484,000 balance of the first-lien note secured by the
Point West Apartments, with an original maturity of May 2001, was paid off to
retire debt with interest rates higher than the current market rate.
NOTE G - NOTE AND INTEREST RECEIVABLE
When the Denbigh Village Apartments was sold in August 1994, the Partnership
accepted a 9% interest-bearing promissory note which matured in March 1996. The
Partnership has negotiated with the purchaser to extend the note until April
1997.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The Partnership's investment properties consist of seventeen apartment
complexes. The following table sets forth the average occupancy of the
properties for the nine months ended September 30, 1996 and 1995:
Average Occupancy
1996 1995
The Apartments
Omaha, NE 93% 95%
Arbor East Apartments
Nashville, TN 95% 98%
Briar Bay Racquet Club Apartments
Miami, FL 97% 92%
Chimney Hills Apartments
Marietta, GA 93% 96%
Citadel Apartments
El Paso, TX 91% 93%
Citadel Village Apartments
Colorado Springs, CO 98% 97%
Foothill Place Apartments
Salt Lake City, UT 97% 97%
Knollwood Apartments
Nashville, TN 98% 98%
Lake Forest Apartments
Omaha, NE 96% 98%
Nob Hill Villa Apartments
Nashville, TN 96% 98%
Overlook Apartments
Memphis, TN 84% 89%
Point West Apartments
Charleston, SC 87% 90%
Post Ridge Apartments
Nashville, TN 97% 97%
Rivers Edge Apartments
Auburn, WA 96% 93%
South Port Apartments
Tulsa, OK 96% 83%
Stratford Place Apartments
Austin, TX 93% 93%
Village East Apartments
Cimarron Hills, CO 99% 99%
The increase in occupancy for Briar Bay Racquet Club Apartments is due to
increased resident retention efforts at the property. The decrease in occupancy
at the Overlook Apartments is due to increased competition in the Memphis market
resulting from the renovation of surrounding properties in the area and an
outflow of tenants who purchased homes. The increase in occupancy at South Port
Apartments is a result of rental rates being lowered slightly as well as a
tightening of the apartment supply in the Tulsa market.
The Partnership realized a loss before extraordinary items of approximately
$180,000 for the three months ended September 30, 1996, and $602,000 for the
nine months ended September 30, 1996, compared to a loss before extraordinary
items of $431,000 for the three months ended September 30, 1995, and $727,000
for the nine months ended September 30, 1995. For the three and nine months
ended September 30, 1996, the decreased loss is due primarily to increases in
rental income.
Rental income increased for the three and nine months ended September 30, 1996,
compared to the corresponding periods of 1995, due primarily to an increase in
rental rates that was partially offset by increased concessions and a decrease
in occupancy for the nine months ended September 30, 1996, at several of the
Partnership's properties. Interest and other income increased for the three and
nine months ended September 30, 1996, compared to the corresponding period of
1995, due primarily to increased cash available for investment.
Property operations expense increased for the three and nine months ended
September 30, 1996, compared to the three and nine months ended September 30,
1995, due primarily to increased maintenance expenses in efforts to increase the
curb appeal of several of the Partnership's properties and increased property
management fees resulting from increased rental revenues. Depreciation and
amortization expense increased for the three and nine months ended September 30,
1996, compared to the three and nine months ended September 30, 1995, due
primarily to approximately $5.4 million in property improvements and
replacements from September 30, 1995, to September 30, 1996. Interest expense
decreased for the three and nine months ended September 30, 1996, compared to
the three and nine months ended September 30, 1995, due to several of the
Partnership's properties being refinanced in December 1995, and the Point West
Apartments' first-lien note being paid off as discussed below. Administrative
expenses decreased for the three and nine months ended September 30, 1996,
compared to the three and nine months ended September 30, 1995, due to decreased
legal costs due to the nonrecurring nature of the costs associated with amending
the Partnership agreement to reduce the working capital reserve requirements in
1995, and decreased expense reimbursements related primarily to the efforts of
the Dallas partnership administration staff during the management transition
period in 1995, partially offset by $392,000 in special management fees related
to 1996 distributions.
In February of 1996, the $484,000 balance of the first-lien note secured by the
Point West Apartments, with an original maturity of May 2001, was repaid so that
the Partnership could retire debt with interest rates higher than the current
market rate.
The $2,999,000 extraordinary gain on disposition of investment property realized
during the nine months ended September 30, 1996, resulted from the foreclosure
of the Metro Centre Office Building in February of 1996.
When the Denbigh Village Apartments was sold in August 1994, the Partnership
accepted a 9% interest-bearing promissory note which matured in March 1996. The
Partnership has negotiated with the purchaser to extend the note until April
1997.
The $81,000 loss on refinancing realized during the three months ended September
30, 1996, related to the interim financing agreement for the Post Ridge
Apartments. Under the terms of the interim financing arrangement, the new $4.1
million mortgage note bears interest at 8% through October 31, 1996, and from
November 1, 1996, through the maturity date of November 15, 1996, the note shall
bear a rate equal to 2.5% plus the average one month LIBOR. As a result of the
refinancing, the Partnership realized a $16,000 gain on the forgiveness of
accrued interest and a $61,000 gain on the forgiveness of advances from prior
years, offset by a $158,000 loss on the write-off of loan costs.
The $250,000 gain on refinancing realized during the nine months ended September
30, 1995, related to the refinancing of Nob Hill Villa Apartments. Through this
refinancing, a new $7.5 million mortgage note which bears interest at 9.2% and
matures in April 2005, was obtained. As a result of the refinancing, the
Partnership realized a $250,000 discount on the second mortgage resulting in the
extraordinary gain.
As part of the ongoing business plan of the Partnership, the General Partner
monitors the rental market environment of each 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 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
General Partner will be able to sustain such a plan.
As of September 30, 1996, the Partnership held cash and cash equivalents of
approximately $6,468,000 compared to approximately $10,092,000 at September 30,
1995. Net cash provided by operating activities increased primarily due to
increased rental revenues, the receipt of an insurance refund, an escrow receipt
in 1996 from the refinancing of the Knollwood Apartments debt in December of
1995, and the collection of insurance proceeds resulting from a fire in
December, 1995 at the Overlook Apartments. The fire damage was covered by
insurance and did not have a material effect on the Partnership. These
increases in cash flow were partially offset by a decrease in accounts payable
due to the timing of accounts payable payments and the payment of accrued
interest. Net cash used in investing activities increased primarily due to
increased property improvements and replacements, partially offset by reduced
proceeds from the sale of investments in 1996. The Partnership has primarily
invested in shorter term cash equivalents during 1996, rather than longer term
securities. Net cash used in financing activities increased primarily as a
result of increased distributions to partners in 1996 as well as decreased
proceeds from long term borrowings.
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 meet 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 approximately $71 million matures at various times
with balloon payments due at maturity, at which time the properties will either
be refinanced or sold. Future cash distributions will depend on the levels of
net cash generated from operations, capital expenditure requirements, property
sales and the availability of cash reserves. Cash distributions of
approximately $4,644,000 and $921,000 were declared and paid during the nine
months ended September 30, 1996 and 1995, respectively.
On January 20, 1995, an affiliate of the General Partner, Insignia CCP IV
Acquisition, L.L.C., closed an offer to purchase Units (the "Tender Offer") for
a cash price of $60 per Unit for Limited Partners of record as of December 15,
1994. Approximately 3,370 Limited Partners holding 64,175 Units (18.72% of total
Units) accepted the Tender Offer and sold their Units to Insignia CCP IV
Acquisition, L.L.C. effective January 20, 1995, for an aggregate sales price of
approximately $3.9 million.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to
this report.
Exhibit 10.70, Contracts related to the refinancing of debt
(a) Multifamily Note dated September 30, 1996, between Post Ridge
Associates, Ltd., Limited Partnership, a Tennessee limited
partnership and Lehman Brothers Holdings Inc. d/b/a Lehman
Capital, a Division of Lehman Brothers Holdings Inc.
(b) Rider To Multifamily Note dated September 30, 1996, between Post
Ridge Associates, Ltd., Limited Partnership, a Tennessee limited
partnership and Lehman Brothers Holdings Inc. d/b/a Lehman
Capital, a Division of Lehman Brothers Holdings Inc.
(b) Reports on Form 8-K:
None.
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.
CONSOLIDATED CAPITAL PROPERTIES IV
By: CONCAP EQUITIES, INC.
General Partner
By: /s/Carroll D. Vinson
Carroll D. Vinson
President
By: /s/Robert D. Long, Jr.
Robert D. Long, Jr.
Vice President/CAO
Date: November 6, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Consolidated
Capital Properties IV 1996 Third Quarter 10-QSB and is qualified in its entirety
by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000355804
<NAME> CONSOLIDATED CAPITAL PROPERTIES IV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 6,468
<SECURITIES> 2,612
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 127,210
<DEPRECIATION> 90,217
<TOTAL-ASSETS> 53,855
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 71,280
0
0
<COMMON> 0
<OTHER-SE> (20,961)
<TOTAL-LIABILITY-AND-EQUITY> 53,855
<SALES> 0
<TOTAL-REVENUES> 20,882
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 21,484
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,574
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 2,918
<CHANGES> 0
<NET-INCOME> 2,316
<EPS-PRIMARY> 6.48<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
</TABLE>
MULTIFAMILY NOTE
US $4,050,000.00 New York, New York
As of September 30, 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 FIFTY THOUSAND AND 00/100 DOLLARS ($4,050,000.00),
with interest on the unpaid principal balance from the date of this Note, until
paid, at the Applicable Interest Rate (defined herein). Principal and interest
shall be payable at 3 World Financial Center, New York, New York 10285, or such
other place as the holder hereof may designate in writing, as follows:
(i) payments of interest only commencing on the first day of October, 1996
and thereafter on the first day of each succeeding calendar month up
to and including the Maturity Date (defined herein); and
(ii) the balance of the aggregate outstanding principal sum and all accrued
but unpaid interest thereon shall be due and payable on the Maturity
Date.
The term "Maturity Date" shall mean November 15, 1996.
Interest on the principal sum of the Note shall be calculated on the basis
of the actual number of days elapsed in a three hundred sixty (360) day year.
All payments to Lender under the Note or this Agreement shall be made by wire
transfer of immediately available federal funds.
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.
POST RIDGE ASSOCIATES, LTD., LIMITED PARTNERSHIP, a
Tennessee limited partnership
By: ConCap Equities, Inc., a Delaware corporation, its
general partner
By: /s/ William H. Jarrard, Jr.
Name: William H. Jarrard, Jr.
Title: Vice President
CORPORATE ACKNOWLEDGEMENT
STATE OF NEW YORK
COUNTY OF NEW YORK
I, Christopher Olenik, a Notary Public of the County and State aforesaid,
certify that William H. Jarrard, Jr., personally appeared before me this day and
acknowledged that he is Vice President of ConCap Equities Inc., a Delaware
corporation, and that by authority duly given and as the act of the corporation
in its capacity as a general partner in and on behalf of Post Ridge Associates,
Ltd., Limited Partnership, a Tennessee limited partnership, the foregoing
instrument was signed in its name by him in his capacity as Vice President.
Witness my hand and official stamp or seal, this 26th day of September,
1996.
Christopher Olenik
Notary Public
My Commission Expires: September 9, 1998
RIDER TO MULTIFAMILY NOTE
THIS RIDER TO MULTIFAMILY NOTE is made as of this 30th day of September,
1996, and is incorporated into and shall be deemed to amend and supplement the
Multifamily Note made by the undersigned (the "Borrower") to LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings Inc.
and its successors, assigns and transferees (the "Lender") dated the same date
as this Rider (the "Note"). The loan evidenced by the Note (the "Loan") is
secured by a Mortgage, Deed of Trust, or Deed to Secure Debt of the same date
(the "Instrument") covering the property described in the Instrument and located
at 595 Hicks Road, Davidson County, Tennessee.
ADDITIONAL COVENANTS. In addition to the covenants and agreements made in
the Note, Borrower further covenants and agrees as follows:
1. INTEREST
(a) The term "Applicable Interest Rate" as used in this Agreement shall
mean a rate per annum (i) from the date of the Note through and including
October 31, 1996 a rate of 8.0%, and (ii) from November 1, 1996 (the "Adjustment
Date") through and including November 15, 1996, a rate equal to 2.5% plus the
LIBO Rate (hereinafter defined). Lender shall notify Borrower of the Applicable
Interest Rate for such period by November 12, 1996.
(b) The term "LIBO Rate" as used herein shall mean the average of the
interbank offered rates for one month United States dollar deposits in the
London market ("One Month LIBOR") as determined two Business Days prior to each
Adjustment Date as follows. Two Business Days prior to each Adjustment Date,
Lender will determine the LIBO Rate on the basis of the One Month LIBOR
quotations of the Reference Banks (hereinafter defined), as such quotations are
available to Lender as of 11:00 a.m. (London time) two Business Days prior to
such Adjustment Date. "Reference Banks" shall mean four leading banks engaged
in transactions in one-month Eurodollar deposits in the international
Eurocurrency market (i) with an established place of business in London, (ii)
whose quotations appear on the Reuters Screen LIBO Page (hereinafter defined)
two Business Days prior to the Adjustment Date in question and (iii) which have
been designated as such by Lender and are able and willing to provide such
quotations to Lender on each Adjustment Date. The term "Reuters Screen LIBO
Page" as used in the Note shall mean the display designated as page "LIBO" on
the Reuters Monitor Money Rates Service (or such other page as may replace the
LIBO page on that service for the purpose of displaying London interbank offered
rate quotations of major banks). The initial Reference Banks will be Bankers
Trust Company, Barclays Bank PLC, National Westminster Bank PLC and The Bank of
Tokyo, Ltd. If any Reference Bank designated by Lender should be removed from
the Reuters Screen LIBO Page or in any other way fails to meet the
qualifications of a Reference Bank, Lender will be required to designate an
alternative Reference Bank.
(d) Two Business Days prior to each Adjustment Date, the LIBO Rate will be
established by Lender as follows:
(i) if two Business Days prior to any Adjustment Date two or more of
the Reference Banks provide such offered rate quotations, the
LIBO Rate will be the arithmetic mean of such offered rate
quotations (rounding such arithmetic mean upwards if necessary to
the nearest whole multiple of 1/16%);
(ii) if two Business Days prior to any Adjustment Date only one of the
Reference Banks provides such offered rate quotations, the LIBO
Rate will be whichever is the higher of (A) the LIBO Rate as
determined two Business Days prior to the previous Adjustment
Date and (B) a rate per annum (the "Reserve Interest Rate")
determined by Lender to be either (I) the arithmetic mean
(rounding such arithmetic mean upwards if necessary to the
nearest whole multiple of 1/16%) of the one-month Eurodollar
lending rates that the New York City banks selected by Lender are
quoting two Business days prior to the relevant Adjustment Date)
to the principal London Offices of leading banks in the London
interbank market or (II) if Lender can determine no such
arithmetic mean, the lowest one-month Eurodollar lending rate
that the New York City banks selected by Lender are quoting two
Business Days prior to such Adjustment Date to leading European
banks; and
(iii)if two Business Days prior to any Adjustment Date Lender is
required but is unable to determine the Reserve Interest Rate in
the manner provided in the immediately preceding clause (ii), the
LIBO Rate will be the LIBO Rate as of two Business Days prior to
the previous Adjustment Date, or, in the case of the first
Adjustment Date, 8.0% per annum.
The establishment of the LIBO Rate by Lender, in the absence of manifest
error, will be final and binding.
(e) The term "Business Day" as used in this Agreement shall mean a day upon
which commercial banks are not authorized or required by law to close in New
York, New York or London, England.
2. PREPAYMENT
(a) The principal balance of the Note may be prepaid in whole, but not in
part, upon prior written notice to Lender specifying the date on which such
prepayment is to be made and provided that (i) no Event of Default shall have
occurred; and (ii) Lender shall receive, in addition to such prepayment of
principal (A) all interest accrued and unpaid on the principal balance of the
Note as of the date of such prepayment; and (B) all other sums due to Lender.
(b) If any notice of prepayment is given pursuant to this Section 2, the
amount specified in such notice shall be due and payable on the date specified
in such notice.
3. PROVISION KNOWINGLY AGREED TO BY BORROWER
Borrower recognizes that default by Borrower causing a prepayment of the
Loan will result in Lender incurring additional expense in servicing and
enforcing the Loan, loss to Lender of the use of the money due and interest
accruing thereon, and frustration or impairment of Lender's ability to meet its
commitments to third parties. Borrower agrees that, in the event of any such
prepayment caused by Borrower's default, Lender shall be entitled to damages for
the detriment caused thereby, but that it is extremely difficult and impractical
to ascertain the extent of such damages.
4. LOAN MADE FOR BUSINESS PURPOSES
Borrower represents and warrants that the Loan is made for the purpose of
acquiring or carrying on a business, commercial, or investment activity.
5. NOTICE
Any notice to Lender provided for in this Rider to Multifamily Note shall
be given in the manner provided in the Instrument.
POST RIDGE ASSOCIATES, LTD., LIMITED PARTNERSHIP, a
Tennessee limited partnership
By: ConCap Equities, Inc., a Delaware corporation, its
general partner
By: /s/ William H. Jarrard, Jr.
Name: William H. Jarrard, Jr.
Title: Vice President
