<PAGE>1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1996
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Commission file number 1-11060
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AMERICAN INSURED MORTGAGE INVESTORS
- -----------------------------------------------------------------
(Exact name of registrant as specified in charter)
California 13-3180848
- ------------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11200 Rockville Pike, Rockville, Maryland 20852
- ----------------------------------------- ----------------------
(Address of principal executive offices) (Zip Code)
(301) 816-2300
- -----------------------------------------------------------------
(Registrant's telephone number, including area code)
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, and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
As of May 13, 1996, 10,000,000 depositary units of limited partnership
interest were outstanding.
<PAGE>2
AMERICAN INSURED MORTGAGE INVESTORS
INDEX TO FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1996
PAGE
----
PART I. Financial Information (Unaudited)
Item 1. Financial Statements
Balance Sheets - March 31, 1996 (unaudited)
and December 31, 1995.................... 3
Statements of Operations - for the three
months ended March 31, 1996 (unaudited)
and December 31, 1995.................... 4
Statement of Changes in Partners' Equity -
for the three months ended March 31,
1996 (unaudited)......................... 5
Statements of Cash Flows - for the three
months ended March 31, 1996 and 1995
(unaudited).............................. 6
Notes to Financial Statements.............. 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................... 10
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K........... 11
Signature............................................ 12
<PAGE>3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS
BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
------------- ------------
<S> <C> <C>
(Unaudited)
ASSETS
Investment in FHA-Insured Loans,
at amortized cost, net of unamortized
discount:
Acquired Insured Mortgages $ 9,040,134 $ 9,056,545
Originated Insured Mortgages 14,517,853 14,533,066
------------ ------------
23,557,987 23,589,611
Investment in FHA-Insured Certificates,
at fair value:
Acquired Insured Mortgages 14,300,760 14,774,772
Cash and cash equivalents 654,595 673,733
Receivables and other assets 379,586 377,323
------------ ------------
Total assets $ 38,892,928 $ 39,415,439
============ ============
LIABILITIES AND PARTNERS' EQUITY
Distributions payable $ 823,903 $ 823,903
Accounts payable and accrued expenses 96,003 98,292
------------ ------------
Total liabilities 919,906 922,195
------------ ------------
Partners' equity:
Limited partners' equity 39,992,347 40,059,771
General partner's deficit (4,924,414) (4,922,401)
Unrealized gains on investment
in FHA-Insured Certificates 2,905,089 3,355,874
------------ ------------
Total partners' equity 37,973,022 38,493,244
------------ ------------
Total liabilities and partners'
equity $ 38,892,928 $ 39,415,439
============ ============
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>4
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the three months ended
March 31,
1996 1995
------------ ------------
<S> <C> <C>
Income:
Mortgage investment income $ 896,294 $ 917,938
Interest and other income 9,422 9,264
------------ ------------
905,716 927,202
------------ ------------
Expenses:
Asset management fee to related parties 85,773 85,773
General and administrative 65,477 82,962
------------ ------------
151,250 168,735
------------ ------------
Net earnings $ 754,466 $ 758,467
============ ============
Net earnings allocated to:
Limited partners - 97.1% $ 732,586 $ 736,471
General partner - 2.9% 21,880 21,996
------------ ------------
$ 754,466 $ 758,467
============ ============
Net earnings per Unit of limited
partnership interest $ 0.07 $ 0.07
============ ============
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>5
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS
STATEMENT OF CHANGES IN PARTNERS' EQUITY
For the three months ended March 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
Unrealized
Gains on
Investment in
General Limited FHA-Insured
Partner Partners Certificates Total
------------ ------------ -------------- -------------
<S> <C> <C> <C> <C>
Balance, December 31, 1995 $ (4,922,401) $ 40,059,771 $ 3,355,874 $ 38,493,244
Net earnings 21,880 732,586 -- 754,466
Distributions paid or accrued of
$0.08 per Unit (23,893) (800,010) -- (823,903)
Adjustment to unrealized gains
on investment in FHA-Insured
Certificates -- -- (450,785) (450,785)
------------ ------------- ------------- -------------
Balance, March 31, 1996 $ (4,924,414) $ 39,992,347 $ 2,905,089 $ 37,973,022
============ ============= ============= =============
Limited Partnership Units
outstanding - March 31,
1996 10,000,125
=============
</TABLE>
The accompanying notes are an integral part
of these financial statements.
<PAGE>6
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the three months ended
March 31,
1996 1995
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 754,466 $ 758,467
Adjustments to reconcile net
earnings to net cash provided by
operating activities:
Changes in assets and liabilities:
Increase in receivables and
other assets (2,263) (748)
(Decrease) increase in accounts
payable and accrued expenses (2,289) 9,815
------------ ------------
Net cash provided by operating
activities 749,914 767,534
------------ ------------
Cash flows from investing activities:
Receipt of mortgage principal from
scheduled payments 54,851 49,572
------------ ------------
Net cash provided by investing
activities 54,851 49,572
------------ ------------
Cash flows from financing activities:
Distributions paid to partners (823,903) (823,903)
------------ ------------
Net cash used in financing activities (823,903) (823,903)
------------ ------------
Net decrease in cash and cash
equivalents (19,138) (6,797)
Cash and cash equivalents, beginning
of period 673,733 722,986
------------ ------------
Cash and cash equivalents, end of
period $ 654,595 $ 716,189
============ ============
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>7
AMERICAN INSURED MORTGAGE INVESTORS
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. ORGANIZATION
American Insured Mortgage Investors (the Partnership) was formed under the
Uniform Limited Partnership Act in the state of California on July 12, 1983. The
Partnership Agreement states that the Partnership will terminate on December 31,
2008, unless previously terminated under the provisions of the Partnership
Agreement.
Effective September 6, 1991, CRIIMI, Inc. (the General Partner) succeeded
the former general partners to become the sole general partner of the
Partnership. CRIIMI, Inc. is a wholly owned subsidiary of CRIIMI MAE Inc.
(CRIIMI MAE).
The Partnership's investment in mortgages consists of participation
certificates evidencing a 100% undivided beneficial interest in government
insured multifamily mortgages issued or sold pursuant to Federal Housing
Administration (FHA) programs (FHA-Insured Certificates) and FHA-insured
mortgage loans (FHA-Insured Loans). The mortgages underlying the FHA-Insured
Certificates and FHA-Insured Loans are non-recourse first liens on multifamily
residential developments.
2. BASIS OF PRESENTATION
In the opinion of the General Partner, the accompanying unaudited financial
statements contain all adjustments of a normal recurring nature necessary to
present fairly the financial position of the Partnership as of March 31, 1996
and December 31, 1995 and the results of its operations and its cash flows for
the three months ended March 31, 1996 and 1995.
These unaudited financial statements have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission. Certain
information and note disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted. While the General Partner believes that the disclosures
presented are adequate to make the information not misleading, it is suggested
that these financial statements be read in conjunction with the financial
statements and the notes to the financial statements included in the
Partnership's Annual Report filed on Form 10-K for the year ended December 31,
1995.
3. INVESTMENT IN FHA-INSURED LOANS
As of March 31, 1996 and December 31, 1995, the Partnership's investment in
FHA-Insured Loans consisted of four Acquired Insured Mortgages and two
Originated Insured Mortgages.
As of March 31, 1996 and December 31, 1995, these investments had an aggregate
amortized cost of $23,557,987 and $23,589,611, respectively, face value of
$26,520,316 and $26,573,553, respectively, and fair value of $27,158,654 and
$27,625,663, respectively. All of the FHA-Insured Loans are current with
respect to payment of principal and interest as of May 10, 1996.
In addition to base interest payments under originated insured mortgages,
the Partnership is entitled to additional interest based on a percentage of the
net cash flow from the underlying development and of the net proceeds from the
refinancing, sale or other disposition of the underlying development (referred
to as Participations). During the three months ended March 31, 1996 and 1995,
the Partnership received $12,158 and $28,524, respectively, from the
<PAGE>8
AMERICAN INSURED MORTGAGE INVESTORS
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
2. BASIS OF PRESENTATION - Continued
Participations. These amounts are included in mortgage investment income on
the accompanying statements of operations.
4. INVESTMENT IN FHA-INSURED CERTIFICATES
As of March 31, 1996 and December 31, 1995, the Partnership's investment in
FHA-Insured Certificates consisted of nine Acquired Insured Mortgages with an
aggregate amortized cost of $11,395,671 and $11,418,898, respectively, face
value of $13,979,694 and $14,023,399, respectively, and fair value of
$14,300,760 and $14,774,772, respectively. All of the FHA-Insured Certificates
are current with respect to payment of principal and interest as of May 10,
1996.
5. DISTRIBUTIONS TO UNITHOLDERS
The distributions paid or accrued to Unitholders on a per Unit basis for
the three months ended March 31, 1996 and 1995 are as follows:
<TABLE>
<CAPTION>
Quarter Ended 1996 1995
- ------------- -------- --------
<S> <C> <C>
March 31, $ 0.08 $ 0.08
======== ========
</TABLE>
The basis for paying distributions to Unitholders is net proceeds from
mortgage dispositions and cash flow from operations, which includes regular
interest income and principal from insured mortgages. Although Insured
Mortgages yield a fixed monthly mortgage payment once purchased, the cash
distributions paid to the Unitholders will vary during each period due to (1)
the fluctuating yields in the short-term money market where the monthly mortgage
payments received are temporarily invested prior to the payment of quarterly
distributions, (2) the reduction in the asset base due to monthly mortgage
payments received or mortgage dispositions, (3) variations in the cash flow
attributable to the delinquency or default of Insured Mortgages and (4) changes
in the Partnership's operating expenses.
6. TRANSACTIONS WITH RELATED PARTIES
The General Partner and certain affiliated entities have, during the three
months ended March 31, 1996 and 1995, earned or received compensation or
payments for services from the Partnership as follows:
PAGE>9
AMERICAN INSURED MORTGAGE INVESTORS
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
<TABLE>
<CAPTION>
COMPENSATION PAID OR ACCRUED TO RELATED PARTIES
----------------------------------------------
Capacity in Which For the three months ended March 31,
Name of Recipient Served/Item 1996 1995
- ----------------- ---------------------------- -------- --------
<S> <C> <C> <C>
CRIIMI, Inc. General Partner/Distribution $ 21,880 $ 23,893
AIM Acquisition Advisor/Asset Management Fee 85,773 85,773
Partners, L.P.(1)
CRI(2) Affiliate of General Partner/
Expense Reimbursement -- 15,535
CRIIMI MAE Management, Affiliate of General Partner/ 8,969 --
Inc. (2) Expense Reimbursement
<FN>
(1) The Advisor, pursuant to the Partnership Agreement, effective July 12, 1983, is entitled to an Asset Management Fee equal
to 0.95% of Total Invested Assets (as defined in the Partnership Agreement). The sub-advisor to the Partnership (the Sub-advisor)
is entitled to a fee of 0.28% of Total Invested Assets. CRI/AIM Management, Inc., which acted as the Sub-advisor through June 30,
1995, earned a fee equal to $0 and $25,278, for the three months ended March 31, 1996 and 1995. CRIIMI MAE Services Limited
Partnership now serves as the Sub-advisor. Of the amounts paid to the Advisor, CRIIMI MAE Services Limited Partnership earned a fee
equal to $25,278 for the three months ended March 31, 1996.
(2) Prior to CRIIMI MAE becoming a self-administered REIT, amounts were paid to CRI as reimbursement for expenses incurred
prior to June 30, 1995 on behalf of the General Partner and the Partnership. The transaction in which CRIIMI MAE became a self-
administered REIT has no impact on the payments required to be made by the Partnership, other than that the expense reimbursement
previously paid by the Partnership to CRI in connection with the provision of services by the Sub-advisor are, effective June 30,
1995, paid to a wholly-owned subsidiary of CRIIMI MAE, CRIIMI MAE Management, Inc.
</FN>
</TABLE>
<PAGE>10
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
General
- -------
As of March 31, 1996, the Partnership had invested in 15 Insured Mortgage
Investments, with an aggregate amortized cost of approximately $35 million, face
value of approximately $41 million and fair value of approximately $41 million.
All of the mortgage investments are current with respect to payment of
principal and interest as of May 10, 1996.
Results of Operations
- ---------------------
Net earnings did not change significantly for the three months ended March
31, 1996 as compared to the corresponding period in 1995.
Mortgage investment income and interest and other income did not change
significantly for the three months ended March 31, 1996 as compared to the
corresponding period in 1995.
Asset management fees did not change for the three months ended March 31,
1996 as compared to the corresponding period in 1995.
General and administrative expenses decreased for the three months ended
March 31, 1996, as compared to the corresponding periods in 1995. These
decreases were due primarily to decreases in investor services expenses, annual
and quarterly reporting expenses and payroll.
The Partnership did not dispose of any mortgage investments during the
three months ended March 31, 1996 and 1995.
Liquidity and Capital Resources
- -------------------------------
The Partnership's operating cash receipts, derived from payments of
principal and interest on insured mortgages, plus cash receipts from interest on
short-term investments, were sufficient for the three months ended March 31,
1996 to meet operating requirements.
The basis for paying distributions to Unitholders is net proceeds from
insured mortgage dispositions, if any, and cash flow from operations, which
includes regular interest income and principal from insured mortgages. Although
insured mortgages yield a fixed monthly mortgage payment once purchased, the
cash distributions paid to the Unitholders will vary during each period due to
(1) the fluctuating yields in the short-term money market where the monthly
mortgage payments received are temporarily invested prior to the payment of
quarterly distributions, (2) the reduction in the asset base due to monthly
mortgage payments received or mortgage dispositions, (3) variations in the cash
flow attributable to the delinquency or default of insured mortgages and (4)
changes in the Partnership's operating expenses.
Net cash provided by operating activities decreased for the three months
ended March 31, 1996 as compared to the corresponding period in 1995 primarily
due to a reduction in accounts payable.
Net cash provided by investing activities increased for the three months
ended March 31, 1996 as compared to the corresponding period in 1995 primarily
due to an increase in the receipt of mortgage principal from scheduled payments.
Net cash used in financing activities did not change for the three months
ended March 31, 1996 as compared to the corresponding period in 1995.
<PAGE>11
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
No reports on Form 8-K were filed with the Securities and Exchange
Commission during the quarter ended March 31, 1996.
The exhibits filed as part of this report are listed below:
Exhibit No. Description
- ------------- -----------------------
27 Financial Data Schedule
<PAGE>12
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN INSURED MORTGAGE
INVESTORS (Registrant)
By: CRIIMI, Inc.
General Partner
May 14, 1996 By: /s/ Cynthia O. Azzara
- ------------- ------------------------
Date Cynthia O. Azzara
Principal Financial
and Accounting Officer<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED
FROM THE QUARTERLY REPORT ON FORM 10-Q AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH QUARTERLY REPORT ON FORM 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 655
<SECURITIES> 14,301
<RECEIVABLES> 23,937
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 38,893
<CURRENT-LIABILITIES> 920
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 37,973
<TOTAL-LIABILITY-AND-EQUITY> 38,893
<SALES> 0
<TOTAL-REVENUES> 905
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 151
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 754
<INCOME-TAX> 0
<INCOME-CONTINUING> 754
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 754
<EPS-PRIMARY> .07
<EPS-DILUTED> 0
</TABLE>
