SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1996 Commission File Number n-nnnnn
TWELVE AMH ASSOCIATES LIMITED PARTNERSHIP
(Exact name of small business issuer as specified in its charter)
Massachusetts 04-2833662
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization
One International Place, Boston, MA 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 330-8600
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
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
<TABLE>
STATEMENT OF OPERATIONS
For the Three Months Ended
March 31, 1996 and 1995 (Unaudited) (Note 1) 1996 1995
- - --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
REVENUES:
Interest income $ 23 -
Expenses:
Interest 1,786,302 1,628,915
Related party interest 17,189 38,221
Amortization 101,157 101,157
Related party management fee 75,000 75,000
General and administrative 558 5,255
--------------------------------------
1,980,206 1,848,548
----------------------------------
Loss from Operations (1,980,183) (1,848,548)
Equity in Losses from Operating
Partnerships (1,697,897) (1,504,378)
--------------------------------
Net Loss $(3,678,080) $(3,352,926)
=================================
Net Loss Allocated to General Partners $ (36,781) $ (33,529)
===================================
Net Loss Allocated to Limited Partners $(3,641,299) $(3,319,397)
=================================
Net Loss per Unit of Limited Partnership Interest $ (6.069) $ (5,532)
====================================
</TABLE>
<PAGE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
BALANCE SHEETS
March 31, 1996 and December 31, 1995 March 31, December 31
1996 1996
(Unaudited) (Audited)
ASSETS
<S> <C> <C>
Investments in Operating Partnerships $5,393,118 $ 8,691,341
Deferred financing fee, net of accumulated
amortization of $38,609 and $37,778
respectively 11,391 12,222
Cash and cash equivalents 1,839 40
-------------------------------------
TOTAL ASSETS $ 5,406,348 $ 8,703,603
===================================
LIABILITIES
Purchase Money Note, net of unamortized
discount $47,547,721 $46,149,350
Notes payable 9,873,978 9,873,978
Accrued interest on operating deficit notes 16,509,072 16,121,141
Accrued expenses - 24,084
Due to affiliates 3,637,063 5,018,456
------------------------------------
$77,567,834 $77,187,009
----------------------------------
PARTNERS' CAPITAL (DEFICIT):
Limited partners - Units of Limited
Partnership Interest, $96,250 stated
value per unit; authorized, issued
and outstanding - 600 Units ($70,913,590) ($67,272,291)
General partners ( 1,247,896) ( 1,211,115)
------------------------------------
($72,161,486) ($68,483,406)
TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 5,406,348 $ 8.703,603
====================================
</TABLE>
<PAGE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
STATEMENT OF CASH FLOWS
For the Three Months Ended
March 31, 1996 and 1995 (Unaudited) (Note 1) 1996 1995
- - -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating activities:
Net loss...................................................................... $(3,678,080) $(3,352,926)
Adjustments to reconcile net loss to net cash used
in operating activities:
Amortization.......................................................... 101,157 101,157
Equity in loss of Operating Partnerships 1,697,897 1,504,378
Changes in assets and liabilities:
Interest added to loan principal on Purchase
Money Note........................................................ 1,398,371 1,240,984
Increase in accrued interest on operating deficit notes 387,931 387,931
Decrease in accrued expenses.......................................... ( 24,084) -
(Decrease) increase in due to affiliates (1,381,393) 118,421
----------- ------------
Net cash used in operating activities................................. (1,498,201) ( 55)
Cash flows from investing activities:
Cash distribution from Operating Partnerships 1,500,000 -
------------ ------------
Net cash provided by investing activities 1,500,000 -
------------ ------------
Increase (Decrease) in cash and cash equivalents
during the year............................................................ 1,799 ( 55)
Cash and cash equivalents, beginning of period 40 360
---------------------------
Cash and cash equivalents, end of period...................................... $1,839 $ 305
==================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
STATEMENTS OF CHANGES IN PARTNERS' DEFICIT
UNITS OF INVESTOR
For the Three Months Ended LIMITED LIMITED GENERAL
March 31, 1996 and 1995 PARTNERSHIP PARTNERS' PARTNERS' TOTAL
(Unaudited) (Note 1) INTEREST CAPITAL CAPITAL CAPITAL
- - -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Balance, December 31, 1995 600 $(67,272,291) $( 1,211,115) $(68,483,406)
Net loss ( 3,641,299) ( 36,781) ( 3,678,080)
------------------------------------------------------------------------------------------
Balance March 31, 1996 600 $(70,913,590) $( 1,247,896) $(72,161,486)
======================================================================================
Balance, December 31, 1994 600 $(55,865,456) $( 1,095,894) $(56,961,350)
Net loss ( 3,319,397) ( 33,529) ( 3,352,926)
------------------------------------------------------------------------------------------
Balance March 31, 1995 600 $(59,184,853) $( 1,129,423) $(60,314,276)
======================================================================================
</TABLE>
<PAGE>
The accompanying notes are an integral part of these financial statements.
NOTES TO FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
1. ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein have been prepared
by the Registrant, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. The
Registrant's accounting and financial reporting policies are in
conformity with generally accepted accounting principles and include
adjustments in interim periods considered necessary for a fair
presentation of the results of operations. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and
regulations. It is suggested that these condensed financial
statements be read in conjunction with the financial statements and
the notes thereto included in the Registrant's latest annual report
on Form 10-K.
<PAGE>
The accompanying financial statements reflect the Partnership's
results of operations for an interim period and are not necessarily
indicative of the results of operations for the year ending December
31, 1996.
2. TAX LOSS
The Partnership's taxable loss for 1996 is expected to differ from
that for financial reporting purposes primarily due to accounting
differences in the recognition of depreciation and certain
capitalized costs.
3. RELATED PARTY TRANSACTIONS
Certain loans and interest due to affiliates were repaid from the
$1,500,000 cash distribution from Square 254. These included $129,166
to First Winthrop Corporation as a repayment of its non-interest
bearing advances to the Partnership for administrative expenses; and
to Two Winthrop Properties Inc., $822,284 of accrued interest as of
December 31, 1995, $14,198 of accrued interest for the period January
1 - January 31, 1996, and a $507,934 partial repayment of principal
on its $667,000 note.
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
OF OPERATION
This Item should be read in conjunction with the financial statements and other
items contained elsewhere in the report.
Liquidity and Capital Resources
The Partnership's only assets consist of its 66.67% general partnership
interests in Square 254 Limited Partnership ("Square 254") and National Place
Land Limited Partnership ("National Place"). Square 254 and National Place own a
multiple-use complex located in Washington D.C. known as National Place, and the
underlying land, respectively.
The Partnership's primary source of revenue is distributions from Square 254 and
National Place (collectively, the "Operating Partnerships"). The Partnership
requires cash to pay management fees and general and administrative expenses and
may require cash to satisfy its obligations to fund any operating deficits of
the Operating Partnerships.
The Partnership received no cash distributions from the Operating Partnerships
through 1995. During the three months ended March 31, 1996, the Partnership
received a $1,500,000 distribution from Square 254.
The Partnership's liquidity based on cash and cash equivalents improved from $40
at December 31, 1995 to $1,839 at March 31, 1996. The Partnership's $1,500,000
provided by operating activities was substantially offset by $1,498,201 used in
operating activities including $1,473,582 of loan payments to the general
partner and an affiliate of the general partner.
Based on (i) Square 254's distribution of $665,570 in April 1996, (ii) Square
254's budget for 1996 which shows sufficient reserves at year-end 1996 for a
cash distribution in 1997 and (iii) Square 254's anticipation of a refinancing
of its debt at lower interest rates in 1996 with a resulting decrease in
interest expense in future years, the General Partners believe that Square 254
will continue to generate sufficient cash flow to distribute cash to the
Partnership on a consistent basis in the foreseeable future. However, the
ability of Square 254 to generate sufficient cash flow is subject to many
factors outside the control of the Partnership. Accordingly, there can be no
assurance that Square 254 will be able to make distributions to its partners.
Based on the Partnership's current and expected cash flow, the Partnership will
not have sufficient funds to satisfy its existing indebtedness at maturity
(August 1999). Accordingly, if the Partnership cannot refinance or modify this
indebtedness on favorable terms, or sell its interest in the Operating
Partnerships for sufficient value, the Partnership may lose its interest in the
Operating Partnerships through foreclosure. In addition, any distributions made
by the Operating Partnerships will be applied first to satisfy the remaining
$159,066 plus accrued interest due to affiliates for prior loans made to the
Partnership, and $3,475,000 in accrued management fees due to affiliates. As a
result, at this time it appears that investors in the Partnership will not
receive a return of a significant portion of their investment.
<PAGE>
Results of Operations
The Partnership's expenses for the three months ended March 31, 1996 were
$131,658 (or 7.1%) greater than expenses for the three months ended March 31,
1995. This increase resulted from an increase in accrued interest expense on the
loans made to the Partnership to acquire its interests in the Operating
Partnerships. All interest on such loans is accrued and will be due and payable
upon the maturities of such loans.
Equity in loss from Operating Partnerships for the three months ended March 31,
1996 increased 12.9% (from $1,504,378 to $1,697,897) when compared to the same
period last year. This increase was primarily due to a decline in the operating
results of the Operating Partnerships. Net operating income generated by the
Hotel portion of the mixed-use complex owned by Square 254 decreased for the
three months ended March 31, 1996 compared to the three months ended March 31,
1995, due primarily to lower occupancy levels. The operating results for the
Office Towers portion of the complex increased for the three months ended March
31, 1996, due to the re-leasing of vacant space. Equity in loss from the Land
Partnership increased for the three months ended March 31, 1996 compared to the
three months ended March 31, 1995 primarily as a result of an increase in
interest expense.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
Exhibit 27, Financial Data Schedule, is filed as an exhibit to this
report.
Reports on Form 8-K: No Report on Form 8-K was filed during the
period.
<PAGE>
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.
TWELVE AMH ASSOCIATES
LIMITED PARTNERSHIP
(Registrant)
By: Two Winthrop Properties, Inc.
Managing General Partner
By: /s/ Michael L. Ashner
Michael L. Ashner
Chief Executive Officer
By: /s/ Edward V. Williams
Edward V. Williams
Chief Financial officer
DATED: May 14, 1996
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information
extracted from unaudited financial statements for the
three month period ending March 31, 1996 and is
qualified in its entirety by reference to such financial
statements
</LEGEND>
<CIK> 0000748524
<NAME> TWELVE AMH ASSOCIATES LIMITED PARTNERSHIP
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 1,839
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,839
<PP&E> 0
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0
0
<OTHER-SE> (72,161,486)
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<TOTAL-REVENUES> 23
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<OTHER-EXPENSES> 176,715
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</TABLE>
