FORM 10-QSB.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT
For the transition period.........to.........
Commission file number 0-13309
ANGELES PARTNERS XII
(Exact name of small business issuer as specified in its charter)
California 95-3903623
(State or other jurisdiction of (IRS 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 (803) 239-1000
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) ANGELES PARTNERS XII
BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
September 30, 1995
<S> <C> <C>
Assets
Cash:
Unrestricted $ 3,390,900
Restricted--tenant security deposits 896,989
Accounts receivable, net of allowance for
doubtful accounts of $53,808 164,415
Escrows for taxes 474,034
Restricted escrows 2,224,675
Other assets 2,448,531
Investment in joint venture 198,620
Investment properties:
Land $ 10,340,868
Buildings and related personal property 86,309,416
96,650,284
Less accumulated depreciation (49,879,943) 46,770,341
$ 56,568,505
Liabilities and Partners' Deficit
Liabilities
Accounts payable $ 398,921
Tenant security deposits 884,339
Accrued taxes 893,629
Other liabilities 824,736
Mortgage notes payable 73,524,457
Partners' Deficit
General partner $ (584,559)
Limited partners (44,773 units issued and
outstanding) (19,373,018) (19,957,577)
$ 56,568,505
</TABLE>
[FN]
See Accompanying Notes to Financial Statements
b) ANGELES PARTNERS XII
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Revenues:
Rental income $5,010,124 $4,859,295 $14,800,504 $14,248,547
Other income 373,486 325,789 1,057,793 918,772
Total revenues 5,383,610 5,185,084 15,858,297 15,167,319
Expenses:
Operating 1,269,540 1,273,672 4,011,330 4,064,771
General and administrative 130,449 122,212 411,071 560,270
Property management fees 260,873 250,402 767,629 737,274
Maintenance 665,729 738,943 1,570,774 1,889,594
Depreciation 1,154,555 1,091,289 3,399,548 3,240,710
Amortization 8,821 8,206 25,309 21,230
Interest 1,668,136 1,643,293 4,765,757 5,241,841
Property taxes 520,938 485,559 1,546,665 1,416,784
Bad debt expense 76,517 14,005 151,875 65,923
Loss on disposal of asset 11,713 -- 38,317 6,381
Tenant reimbursements (121,195) (54,215) (172,307) (196,428)
Total expenses 5,646,076 5,573,366 16,515,968 17,048,350
Loss before equity in
income (loss) of joint
venture (262,466) (388,282) (657,671) (1,881,031)
Equity in income (loss) of
joint venture 42,898 26,409 (8,106) 34,423
Net loss $ (219,568) $ (361,873) $ (665,777) $(1,846,608)
Net loss allocated to
general partners (1%) $ (2,196) $ (3,619) $ (6,658) $ (18,466)
Net loss allocated to
limited partners (99%) (217,372) (358,254) (659,119) (1,828,142)
$ (219,568) $ (361,873) $ (665,777) $(1,846,608)
Net loss per limited
partnership unit $ (4.85) $ (8.00) $ (14.72) $ (40.83)
</TABLE>
[FN]
See Accompanying Notes to Financial Statements
c) ANGELES PARTNERS XII
STATEMENT OF CHANGES IN PARTNERS' DEFICIT
(Unaudited)
<TABLE>
<CAPTION>
Limited
Partnership General Limited
Units Partners Partners Total
<S> <C> <C> <C> <C>
Original capital contributions 44,773 $ 1,000 $ 44,773,000 $ 44,774,000
Partners' deficit at
December 31, 1994 44,773 $(577,901) $(18,713,899) $(19,291,800)
Net loss for the nine months
ended September 30, 1995 -- (6,658) (659,119) (665,777)
Partners' deficit at
September 30, 1995 44,773 $(584,559) $(19,373,018) $(19,957,577)
</TABLE>
[FN]
See Accompanying Notes to Consolidated Financial Statements
d) ANGELES PARTNERS XII
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (665,777) $(1,846,608)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation 3,399,548 3,240,710
Amortization of discounts, loan costs, and
leasing commissions 294,676 468,616
Bad debt 151,875 65,923
Loss on disposal of asset 38,317 6,381
Equity in loss (income) of joint venture 8,106 (34,423)
Change in accounts:
Restricted cash (15,732) 63,876
Accounts receivable (183,443) (183,329)
Escrows for taxes 220,701 113,630
Other assets (132,371) (15,393)
Accounts payable (336,095) (155,710)
Tenant security deposit liabilities 4,248 28,387
Accrued taxes (58,590) (78,806)
Other liabilities 197,884 60,808
Net cash provided by operating activities 2,923,347 1,734,062
Cash flows from investing activities:
Property improvements and replacements (1,197,847) (1,183,742)
Deposits to restricted escrows (982,153) (126,038)
Withdrawals from restricted escrows 41,026 817,968
Net cash used in investing activities (2,138,974) (491,812)
Cash flows used in financing activities:
Payments on mortgage notes payable (5,785,875) (441,620)
Proceeds from refinance 6,600,000
Loan costs (254,554) (279,618)
Net cash provided by (used in) financing
activities 559,571 (721,238)
Net increase (decrease) in cash 1,343,944 521,012
Cash at beginning of period 2,046,956 2,568,130
Cash at end of period $ 3,390,900 $ 3,089,142
Supplemental disclosure of cash flow information
Cash paid for interest $ 4,436,678 $ 4,706,840
</TABLE>
[FN]
See Accompanying Notes to Financial Statements
e) ANGELES PARTNERS XII
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-QSB and Item 310(b) of
Regulation S-B. 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 management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the nine month period ended September 30,
1995, are not necessarily indicative of the results that may be expected for the
fiscal year ending December 31, 1995. For further information, refer to the
financial statements and footnotes thereto included in the Partnership's annual
report on Form 10-KSB for the fiscal year ended December 31, 1994.
Certain reclassifications have been made to the 1994 information to conform
to the 1995 presentation.
Note B - Investment in Joint Venture
The Partnership owns a 44.5% interest in the Princeton Meadows Golf Course
Joint Venture ("Joint Venture"). The Partnership accounts for its interest in
the Joint Venture on the equity method.
Condensed balance sheet information of the Joint Venture at September 30,
1995 is as follows:
Assets
Cash $ 276,240
Other assets 123,988
Investment properties, net 1,898,912
Total $2,299,140
Liabilities and Partners' Capital
Notes payable to AMIT, in default $1,320,419
Other liabilities 533,382
Partners' capital 445,339
$2,299,140
Note B - Investment in Joint Venture (continued)
The condensed statements of operations of the Joint Venture are summarized
as follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Revenue $ 501,362 $ 429,594 $ 985,090 $ 975,529
Costs and expenses (404,963) (370,247) (1,003,307) (898,174)
Net income (loss) $ 96,399 $ 59,347 $ (18,217) $ 77,355
Note C - 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 for certain expenses incurred by
affiliates on behalf of the Partnership. The following payments were made to
the Managing General Partner and affiliates for the nine months ended September
30, 1995 and 1994:
1995 1994
Property management fees $767,629 $737,274
Marketing services 4,164 10,431
Reimbursement for services of
affiliates 317,171 356,960
The Partnership insures 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 of the affiliate of the Managing General
Partner who receives 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.
Angeles Mortgage Investment Trust ("AMIT"), a real estate investment trust,
currently provides financing to the Joint Venture in the amount of $1,320,419
which is in default at September 30, 1995 (see Part II, Item 1. Legal
Proceedings).
Note C - Transactions with Affiliated Parties (continued)
MAE GP Corporation ("MAE GP), an affiliate of the Managing General Partner,
owns 1,675,113 Class B Shares of AMIT. MAE GP has the option to convert these
Class B Shares, in whole or in part, into Class A Shares on the basis of 1 Class
A Share for every 49 Class B Shares. These Class B Shares entitle MAE GP to
receive 1% of the distributions of net cash distributed by AMIT. These Class B
Shares also entitle MAE GP to vote on the same basis as Class A Shares which
allows MAE GP to vote approximately 37% of the total shares (unless and until
converted to Class A Shares at which time the percentage of the vote controlled
represented by the shares held by MAE GP would approximate 1% of the vote).
Between the date of acquisition of these shares (November 24, 1992) and March
31, 1995, MAE GP declined to vote these shares. Since that date, MAE GP voted
its shares at the 1995 annual meeting in connection with the election of
trustees and other matters. MAE GP has not exerted and continues to decline to
exert any management control over or participate in the management of AMIT.
As part of a settlement of certain disputes with AMIT, MAE GP Corporation
granted to AMIT an option to acquire the Class B Shares. This option can be
exercised at the end of 10 years or when all loans made by AMIT to partnerships
affiliated with MAE GP as of November 9, 1994, (which is the date of execution
of a definitive Settlement Agreement), have been paid in full, but in no event
prior to November 9, 1997. AMIT delivered to MAE GP cash in the sum of
$250,000 at closing, which occurred April 14, 1995, as payment for the option.
Upon exercise of the option, AMIT would remit to MAE GP an additional $94,000.
Simultaneously with the execution of the option, MAE GP executed an
irrevocable proxy in favor of AMIT, the result of which is MAE GP will be able
to vote the Class B Shares on all matters except those involving transactions
between AMIT and MAE GP affiliated borrowers or the election of any MAE GP
affiliate as an officer or trustee of AMIT. On those matters, MAE GP granted to
the AMIT trustees, in their capacity as trustees of AMIT, proxies with regard to
the Class B Shares instructing such trustees to vote said Class B Shares in
accordance with the vote of the majority of the Class A Shares voting to be
determined without consideration of the votes of "Excess Class A Shares" as
defined in Section 6.13 of the Declaration of Trust of AMIT.
Note D - Pickwick Place Refinancing
On April 17, 1995, the Partnership refinanced the mortgage encumbering
Pickwick Place. The total mortgage indebtedness which carried a stated interest
rate of 10.5% was in default due to a maturity date of June 1994. The new
mortgage indebtedness of $6,600,000 carries a stated interest rate of 9.10% and
is being amortized over 28 years with a balloon payment due April 1, 2005.
Total capitalized loan costs incurred for the refinancing were $214,136 and
are being amortized over the life of the loan.
Note E - Hunters Glen-Phase I Refinancing
On August 7, 1995, the Partnership refinanced the mortgage encumbering Phase
I of the Hunters Glen Apartments. The total mortgage indebtedness which carried
a variable interest rate based on the monthly LIBOR rate plus 2.375% (8.65% at
refinancing) was in default due to a maturity date of December 1994. The new
mortgage indebtedness of $8,500,000 carries a fixed rate of 8.43% with a balloon
payment due October 15, 2003.
Total capitalized loan costs incurred for the refinancing were $75,418 and
are being amortized over the life of the loan.
Note F - Hunters Glen (Phase I) AP XII Limited Partnership
To facilitate the refinancing of Hunters Glen - Phase I, the property was
restructured into a lower tier partnership known as Hunters Glen (Phase I)
Limited Partnership. Angeles Partners XII is the 99% limited partner in the
lower tier partnership. Although legal ownership of the assets were transferred
to a new entity, Angeles Partners XII retained substantially all economic
benefits from the properties.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
The Partnership's investment properties consist of nine apartment complexes
and one commercial complex. The following table sets forth the average
occupancy of the properties for the nine months ended September 30, 1995 and
1994:
Average
Occupancy
Property 1995 1994
Briarwood
Cedar Rapids, Iowa 97% 98%
Chambers Ridge
Harrisburg, Pennsylvania 91% 91%
Gateway Gardens
Cedar Rapids, Iowa 97% 96%
Hunters Glen - 1
Plainsboro, New Jersey 94% 93%
Hunters Glen - 2
Plainsboro, New Jersey 95% 93%
Hunters Glen - 3
Plainsboro, New Jersey 94% 93%
Pickwick Place
Indianapolis, Indiana 94% 93%
Southpointe
Bedford Heights, Ohio 85% 89%
Twin Lake Towers
Westmont, Illinois 97% 96%
Cooper Pointe Plaza
Olympia, Washington 97% 97%
The Managing General Partner attributes the decrease in occupancy at
Southpointe to personnel turnovers and upgrading the tenant base.
The Partnership's net loss for the three and nine months ended September 30,
1995, was $219,568 and $665,777. The net loss for the corresponding periods of
1994 were $361,873 and $1,846,608 respectively. The decrease in net loss for
the three and nine month periods ended September 30, 1995, is due to increases
in revenues and decreases in administrative, maintenance, and interest
expenses. The increase in revenues is due to an overall increase in occupancy,
clubhouse rentals, laundry income, and lease cancellation fees. Administrative
expense decreased due to decreases in professional fees and reimbursements for
partnership administration. Maintenance expenses decreased due to a less harsh
winter in 1995 as compared to 1994 resulting in decreased snow removal and
maintenance supplies. Interest expense decreased due to a decrease in the
mortgage principal carried by the Partnership as a result of the mortgages
amortizing and the pay off of the second mortgage on Pickwick Place in 1994 and
the refinancing of Pickwick Place and Hunters Glen - Phase I at lower interest
rates. These decreases in expense were partially offset by increases in bad
debt expense related to receivables being reserved or written off at Pickwick
Place, Southpointe, Cooper Pointe Plaza and Hunters Glen. Tenant reimbursements
decreased for the nine month period due to decreases in reimbursable expenses in
1995 and due to changes in the estimate in 1994.
The Partnership's equity interest in the loss of the Joint Venture for the
nine months ended September 30, 1995, was $8,106 as compared to income of
$34,423 for the nine months ended September 30, 1994. The loss during 1995 can
be attributed to bad debt expense recorded during the year due to the reserve
for uncollectible receivables.
At September 30, 1995, the Partnership had unrestricted cash of $3,390,900
compared to $3,089,142 at September 30, 1994. Net cash provided by operating
activities increased primarily as a result of the decrease in net loss as
discussed above and a decrease in escrows for taxes and an increase in other
liabilities. This increase was partially offset by a decrease in accounts
payable. Net cash used in investing activities increased as a result of an
increase in deposits to restricted escrows due to the refinancing of Pickwick
Place. Net cash provided by financing activities increased due to proceeds from
the Pickwick Place refinancing.
On April 17, 1995, the Partnership refinanced the mortgage encumbering
Pickwick Place Apartments. The total indebtedness refinanced was $5,332,638
which represented the first mortgage. The new mortgage indebtedness of
$6,600,000 matures in 10 years. (See Note D for a more detailed discussion.)
On August 1, 1995, the Partnership refinanced the mortgage encumbering Phase
I of the Hunters Glen Apartments. The total indebtedness refinanced was an
$8,500,000 interest-only mortgage with an adjustable rate. The new mortgage
indebtedness of $8,500,000, which carries a fixed rate of 8.43%, matures in 8
years (see Note E for a more detailed discussion).
The Princeton Meadows Golf Course property, which is the sole investment
property of the Joint Venture, had an underground fuel storage tank that was
removed in 1992. This fuel storage tank caused contamination to the area.
Reports were filed with the proper authorities. Subsequent to September 30, the
State of New Jersey Department of Environmental Protection issued a corrective
actions letter to the Joint Venture. Based on discussions with environmental
engineers and others, the Managing General Partner expects the remediation costs
to be immaterial to the Partnership.
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 various 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.
Future cash distributions will depend on the levels of net cash generated from
operations, property sales and the availability of cash reserves.
As part of the ongoing business plan of the Partnership, the Managing 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 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.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Angeles Mortgage Investment Trust ("AMIT"), a real estate investment trust,
currently provides financing to the Joint Venture in the amount of $1,320,419
which is in default at June 30, 1995.
MAE GP Corporation ("MAE GP"), an affiliate of the Managing General Partner,
owns 1,675,113 Class B Shares of AMIT. MAE GP has the option to convert these
Class B Shares, in whole or in part, into Class A Shares on the basis of 1 Class
A Share for every 49 Class B Shares. These Class B Shares entitle MAE GP to
receive 1% of the distributions of net cash distributed by AMIT. These Class B
Shares also entitle MAE GP to vote on the same basis as Class A Shares which
allows MAE GP to vote approximately 37% of the total shares (unless and until
converted to Class A Shares at which time the percentage of the vote controlled
represented by the shares held by MAE GP would approximate 1% of the vote).
Between the date of acquisition of these shares (November 24, 1992) and March
31, 1995, MAE GP declined to vote these shares. Since that date, MAE GP voted
its shares at the 1995 annual meeting in connection with the election of
trustees and other matters. MAE GP has not exerted and continues to decline to
exert any management control over or participate in the management of AMIT.
As part of a settlement of certain disputes with AMIT, MAE GP granted to AMIT
an option to acquire the Class B Shares. This option can be exercised at the
end of 10 years or when all loans made by AMIT to partnerships affiliated with
MAE GP as of November 9, 1994, which is the date of execution of a definitive
Settlement Agreement, have been paid in full, but in no event prior to November
9, 1997. AMIT delivered to MAE GP cash in the sum of $250,000 at closing, which
occurred April 14, 1995, as payment for the option. Upon exercise of the
option, AMIT would remit to MAE GP an additional $94,000.
Simultaneously with the execution of the option, MAE GP executed an
irrevocable proxy in favor of AMIT the result of which is MAE GP will be able to
vote the Class B Shares on all matters except those involving transactions
between AMIT and MAE GP affiliated borrowers or the election of any MAE GP
affiliate as an officer or trustee of AMIT. On those matters, MAE GP granted
to the AMIT trustees, in their capacity as trustees of AMIT, proxies with
regard to the Class B Shares instructing such trustees to vote said Class B
Shares in accordance with the vote of the majority of the Class A Shares voting
to be determined without consideration of the votes of "Excess Class A Shares"
as defined in Section 6.13 of the Declaration of Trust of AMIT.
The Registrant is unaware of any other pending or outstanding litigation that
is not of a routine nature. The Managing General Partner of the Registrant
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 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits -
10.18 Contracts related to modification of debt
(a) Agreement of Modification of Mortgage and Security Agreement
dated April 1, 1994, between Hunters Glen (Phase I) AP XII
Limited Partnership and Lexington Mortgage Company.
(b) Agreement of Modification of Mortgage Note dated April 1, 1994,
between Hunters Glen (Phase I) AP XII Limited Partnership and
Lexington Mortgage Company.
27 Financial Data Schedule, is filed as an exhibit to this report.
b) Reports on Form 8-K:
None filed during the quarter ended September 30, 1995.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ANGELES PARTNERS XII
By: Angeles Realty Corporation II
Managing General Partner
By: /s/Carroll D. Vinson
Carroll D. Vinson
President
By: /s/Robert D. Long
Robert D. Long
Controller and Principal
Accounting Officer
Date: November 14, 1995
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Angeles
Partners XII 1995 Third Quarter 10-QSB and is qualified in its entirety by
reference to such 10-QSB.
</LEGEND>
<CIK> 0000720392
<NAME> ANGELES PARTNERS XII
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 3,390,900
<SECURITIES> 0
<RECEIVABLES> 218,223
<ALLOWANCES> (53,808)
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 96,650,284
<DEPRECIATION> (49,879,943)
<TOTAL-ASSETS> 56,568,505
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (19,957,577)
<TOTAL-LIABILITY-AND-EQUITY> 56,568,505
<SALES> 0
<TOTAL-REVENUES> 15,827,737
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 16,485,408
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,765,757
<INCOME-PRETAX> (665,777)
<INCOME-TAX> 0
<INCOME-CONTINUING> (665,777)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (665,777)
<EPS-PRIMARY> (14.72)
<EPS-DILUTED> 0
<FN
<F1>
The Registrant has an unclassifed balance sheet.
</FN>
</TABLE>
HUNTERS GLEN (PHASE I) AP XII LIMITED PARTNERSHIP
a South Carolina limited partnership
(Mortgagor)
and
LEXINGTON MORTGAGE COMPANY,
a Virginia corporation
(Mortgagee)
____________________________
AGREEMENT OF MODIFICATION OF
MORTGAGE AND SECURITY AGREEMENT
Dated: As of April 1, 1994
Location: 1109 Hunters Glen Drive
Plainsboro, New Jersey
County: Middlesex
RECORD AND RETURN TO:
Messrs. Thacher Proffitt & Wood
Two World Trade Center
New York, New York 10048
Attention: James L. Gregory III
File No.: 16248-00157
THIS AGREEMENT OF MODIFICATION OF SECURITY AGREEMENT made as of the
1st day of April, 1994 ("Agreement"), between HUNTERS GLEN (PHASE I) AP XII
LIMITED PARTNERSHIP, a South Carolina limited partnership (hereinafter referred
to as "Mortgagor") and LEXINGTON MORTGAGE COMPANY, a Virginia corporation
(hereinafter referred to as "Mortgagee"),
W I T N E S S E T H :
WHEREAS Mortgagor is the fee owner of the premises described in
EXHIBIT A attached hereto (hereinafter referred to as the "Premises") and
Mortgagee is the owner and holder of the mortgage covering the fee estate of
Mortgagor in the Premises, as more particularly described in EXHIBIT B attached
hereto (hereinafter referred to as the "Mortgage") and of the note, bond or
other obligation secured thereby (hereinafter referred to as the "Note");
WHEREAS there is now owing on the Note and the Mortgage the unpaid
principal sum of $8,500,000.00 and interest (said principal sum, interest and
all other sums which may or shall become due under the Note and/or the Mortgage,
as modified and amended pursuant to the provisions hereof, being hereinafter
collectively referred to as the "Debt"); and
WHEREAS Mortgagor and Mortgagee have by that certain Agreement of
Modification of Mortgage Note dated as of even date herewith agreed in the
manner set forth therein to modify the time and manner of payment and certain
terms and provisions of the Note;
WHEREAS Mortgagor and Mortgagee have agreed in the manner
hereinafter set forth to modify the certain terms and provisions of the
Mortgage;
NOW, THEREFORE, in pursuance of said agreement and in consideration
of one dollar and other good and valuable consideration, Mortgagor hereby
represents and warrants to and covenants and agrees with Mortgagee as follows:
A. All capitalized words or phrases not otherwise defined herein
shall have the meanings ascribed to them in the Mortgage.
B. Mortgagor and Mortgagee hereby acknowledge that Mortgagor has
deposited the sum of $86,000 into the Capital Improvements Account. Certain
capital improvements set forth on Exhibit C attached hereto shall hereinafter be
included in the definition of Capital Improvements and such funds shall be
disbursed in accordance with Paragraph 51 of the Mortgage.
C. The "Reserve Account Schedule" referred to in Paragraph 52 of
the Mortgage shall be revised to reflect a new "Required Reserve Amount" equal
to $105,600
and a new "Minimum Reserve Amount" equal to $52,800.
D. Mortgagor shall promptly cause this Agreement to be filed,
registered or recorded in such manner and in such places as may be required by
any present or future law in order to publish notice of and fully to protect the
lien of the Mortgage upon, and the interest of Mortgagee in, the Premises.
Mortgagor will pay all filing, registration and recording fees, and all expenses
incident to the preparation, execution and acknowledgement of this Agreement,
and all Federal, state, county and municipal taxes, duties, imposts, assessments
and charges arising out of or in connection with the filing, registration,
recording, execution and delivery of this Agreement and Mortgagor shall hold
harmless and indemnify Mortgagee against any liability incurred by reason of the
imposition of any tax on the issuance, making, filing, registration or recording
of this Agreement.
E. Mortgagor represents, warrants and covenants that there are no
offsets, counterclaims or defenses against the Debt, this Agreement, the
Mortgage or the Note and that Mortgagor (and the undersigned representative of
Mortgagor, if any) has full power, authority and legal right to execute this
Agreement and to keep and observe all of the terms of this Agreement on
Mortgagor's part to be observed or performed.
F. Except as expressly modified pursuant to this Agreement, all
of the terms, covenants and provisions of the Mortgage shall continue in full
force and effect. In the event of any conflict or ambiguity between the terms,
covenants and provisions of this Agreement and those of the Mortgage, the terms,
covenants and provisions of this Agreement shall control.
G. This Agreement may not be modified, amended, waived, changed
or terminated orally, but only by an agreement in writing signed by the party
against whom the enforcement of the modification, amendment, waiver, change or
termination is sought.
H. This Agreement shall be binding upon and inure to the benefit
of Mortgagor and Mortgagee and their respective successors and assigns.
I. This Agreement may be executed in any number of duplicate
originals and each such duplicate original shall be deemed to constitute but one
and the same instrument.
J. If any term, covenant or condition of this Agreement shall be
held to be invalid, illegal or unenforceable in any respect, this Agreement
shall be construed without such provision.
K. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York and the applicable laws of the
United States of America.
IN WITNESS WHEREOF, Mortgagor and Mortgagee have duly executed this
Agreement as of the day and year first above written.
HUNTERS GLEN (PHASE I) AP XII LIMITED
PARTNERSHIP
By: HUNTERS GLEN GP LIMITED PARTNERSHIP,
General Partner
By: GP SERVICES V, INC., General Partner
By: Robert D. Long, Jr.
Name: Robert D. Long, Jr.
Title: CAO/Controller
LEXINGTON MORTGAGE COMPANY
By: Frank Warfield
Name: Frank Warfield
Title: Senior Vice President
STATE OF Virginia )
) SS:
COUNTY OF Fairfax )
On this 7th day of August, 1995, in the County and State aforesaid, before
me, the subscriber, a Notary Public authorized to take acknowledgements and
proofs in said County and State, personally appeared Frank Warfield, the Senior
Vice President of LEXINGTON MORTGAGE COMPANY, a Virginia corporation, who, I am
satisfied, is the person who, as such Senior Vice President, signed and
delivered the within instrument, and he did acknowledge that he is duly
authorized to sign and deliver the within instrument on behalf of said
corporation and that he signed and delivered the same as the act and deed of
said corporation for the uses and purposes set forth therein.
Judith Ann DiBriezo
Notary Public
STATE OF SC )
) SS:
COUNTY OF Greenville )
On this 1st day of August, 1995, in the County and State aforesaid,
before me, the subscriber, a Notary Public authorized to take acknowledgements
and proofs in said County and State, personally appeared Robert D. Long, Jr.,
the CAO/Controller of GP SERVICES V, INC., a South Carolina corporation and the
general partner of HUNTERS GLEN GP LIMITED PARTNERSHIP, a South Carolina limited
partnership and the general partner of HUNTERS GLEN (PHASE I) AP XII LIMITED
PARTNERSHIP, a South Carolina limited partnership, who I am satisfied, is the
person who, as such CAO/Controller, signed and delivered the within instrument,
and he did acknowledge that he is duly authorized to sign and deliver the within
instrument on behalf of said corporation and that he signed and delivered the
same as the act and deed of said corporation and said partnerships for the uses
and purposes set forth therein.
Antoinette M. Wolf
Notary Public
EXHIBIT A
(Description of the Premises)
EXHIBIT B
1. The Mortgage:
Mortgage and Security Agreement dated as of September 30, 1993 given
by Mortgagor to Mortgagee, in the principal sum of $8,500,000.00 and recorded on
October 26, 1993, in the Middlesex County Clerk's Office, in Book 4566, page
42.
2. The Note:
Mortgage Note dated as of September 30, 1993 given by Mortgagor to
Mortgagee, in the original principal sum $8,500,000.00.
EXHIBIT C
Capital Improvements
AGREEMENT OF MODIFICATION OF MORTGAGE NOTE
THIS AGREEMENT OF MODIFICATION OF MORTGAGE NOTE ("Agreement") made
as of the 1st day of April, 1994, between HUNTERS GLEN (PHASE I) AP XII LIMITED
PARTNERSHIP, a South Carolina limited partnership (hereinafter referred to as
"Maker"), and LEXINGTON MORTGAGE COMPANY, a Virginia corporation (hereinafter
referred to as "Payee"),
W I T N E S S E T H :
WHEREAS Payee is the owner and holder of the mortgage (hereinafter
referred to as the "Mortgage") and of the note, bond or other obligation secured
thereby (hereinafter referred to as the "Note") each more fully described in
EXHIBIT A attached hereto;
WHEREAS there is now owing on the Note and the Mortgage the unpaid
principal sum of $8,500,000.00 and interest (said principal sum, interest and
all other sums which may or shall become due under the Note and/or the Mortgage,
as modified and amended pursuant to the provisions hereof, being hereinafter
collectively referred to as the "Debt"); and
WHEREAS Maker and Payee have by that certain Agreement of
Modification of Mortgage and Security Agreement dated as of even date herewith
agreed in the manner set forth therein to modify certain terms and provisions of
the Mortgage;
WHEREAS Maker and Payee have agreed in the manner hereinafter set
forth to modify the time and manner of payment and the terms and provisions of
the Note;
NOW, THEREFORE, in pursuance of said agreement and in consideration
of one dollar and other good and valuable consideration, Maker hereby represents
and warrants to and covenants and agrees with Payee as follows:
A. All capitalized words or phrases not otherwise defined herein
shall have the meanings ascribed to them in the Note.
B. Section A of the Note entitled "PAYMENT TERMS" is deleted in
its and entirety and the manner of and the time for the payment of the unpaid
principal sum of $8,500,000.00, evidenced by the Note and secured by the
Mortgage (the Note and the Mortgage, as modified and amended pursuant to the
provisions of this Agreement hereinafter set forth, being hereinafter
respectively referred to as the "Note" and the "Mortgage") are hereby modified
as follows:
From the date hereof through the Extended Maturity Date
(hereinafter defined), Maker shall pay to Payee:
(i) a payment of interest only on April 1, 1994 and on the
first day of each calendar month thereafter to and
including the first day of September, 1995;
(ii) a Constant Monthly Payment (hereinafter defined) on
October 1, 1995 and on the first day of each calendar
month thereafter to and including the first day of
October, 2003;
(iii) the balance of the principal sum then outstanding and
all interest thereon shall be due and payable on the
fifteenth day of October 15, 2003 (the "Extended
Maturity Date").
Each of such payments shall be applied as follows:
(i) First to the payment of interest computed at the
Applicable Interest Rate; and
(ii) The balance applied toward the reduction of the
principal sum.
The term "Constant Monthly Payment" as used in this Note shall
mean a payment equal to $64,936.44.
C. The first paragraph of Section B of the Note entitled
"INTEREST" is deleted in its entirety and the following is substituted therefor:
The term "Applicable Interest Rate" shall mean (a) during the
period beginning on April 1, 1994 up to and including August 9, 1995, a rate
equal to the Initial Interest Rate, and (b) from and including August 10, 1995
to the Extended Maturity Date, a rate equal to 8.43%.
D. The first sentence and the beginning of the second sentence up
to and including the words "at any time thereafter," of Section D of the Note
entitled "PREPAYMENT" are deleted in their entirety.
E. Maker waives presentment and demand for payment, notice of
dishonor, protest and notice of protest of the Note.
F. Maker represents, warrants and covenants that there are no
offsets, counterclaims or defenses against the Debt, this Agreement, the
Mortgage or the Note and that Maker (and the undersigned representative of
Maker, if any) has full power, authority and legal right to execute this
Agreement and to keep and observe all of the terms of this Agreement on Maker's
part to be observed or performed.
G. Except as expressly modified pursuant to this Agreement, all
of the terms, covenants and provisions of the Note shall continue in full force
and effect. In the event of any conflict or ambiguity between the terms,
covenants and provisions of this Agreement and those of the Note, the terms,
covenants and provisions of this Agreement shall control.
H. This Agreement may not be modified, amended, waived, changed
or terminated orally, but only by an agreement in writing signed by the party
against whom the enforcement of the modification, amendment, waiver, change or
termination is sought.
I. This Agreement shall be binding upon and inure to the benefit
of Maker and Payee and their respective successors and assigns.
J. This Agreement may be executed in any number of duplicate
originals and each such duplicate original shall be deemed to constitute but one
and the same instrument.
K. If any term, covenant or condition of this Agreement shall be
held to be invalid, illegal or unenforceable in any respect, this Agreement
shall be construed without such provision.
L. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York and the applicable laws of the
United States of America.
IN WITNESS WHEREOF, Maker and Payee have duly executed this
Agreement as of the day and year first above written.
HUNTERS GLEN (PHASE I) AP XII LIMITED PARTNERSHIP
By: HUNTERS GLEN GP LIMITED PARTNERSHIP, General
Partner
By: GP SERVICES V, INC., General Partner
By: Robert D. Long, Jr.
Name: Robert D. Long, Jr.
Title: CAO/Controller
LEXINGTON MORTGAGE COMPANY
By: Frank Warfield
Name: Frank Warfield
Title: Senior Vice President
STATE OF Virginia )
) SS:
COUNTY OF Fairfax )
On this 7th day of August, 1995, in the County and State aforesaid, before
me, the subscriber, a Notary Public authorized to take acknowledgements and
proofs in said County and State, personally appeared Frank Warfield, the Senior
Vice President of LEXINGTON MORTGAGE COMPANY, a Virginia corporation, who, I am
satisfied, is the person who, as such Senior Vice President, signed and
delivered the within instrument, and he did acknowledge that he is duly
authorized to sign and deliver the within instrument on behalf of said
corporation and that he signed and delivered the same as the act and deed of
said corporation for the uses and purposes set forth therein.
Judith Ann DiBriezo
Notary Public
STATE OF SC )
) SS:
COUNTY OF Greenville )
On this 1st day of August, 1995, in the County and State aforesaid, before
me, the subscriber, a Notary Public authorized to take acknowledgements and
proofs in said County and State, personally appeared Robert D. Long, Jr., the
CAO/Controller of GP SERVICES V, INC., a South Carolina corporation and the
general partner of HUNTERS GLEN GP LIMITED PARTNERSHIP, a South Carolina limited
partnership and the general partner of HUNTERS GLEN (PHASE I) AP XII LIMITED
PARTNERSHIP, a South Carolina limited partnership, who I am satisfied, is the
person who, as such CAO/Controller, signed and delivered the within instrument,
and he did acknowledge that he is duly authorized to sign and deliver the within
instrument on behalf of said corporation and that he signed and delivered the
same as the act and deed of said corporation and said partnerships for the uses
and purposes set forth therein.
Antoinette M. Wolf
Notary Public
EXHIBIT A
1. The Mortgage:
Mortgage and Security Agreement dated as of September 30, 1993 given
by Maker to Payee, in the principal sum of $8,500,000.00 and recorded on October
26, 1993, in the Middlesex County Clerk's Office, in Book 4566, page 22.
2. The Note:
Mortgage Note dated as of September 30, 1993 given by Maker to
Payee, in the original principal sum $8,500,000.00.
