FORM 10-KSB--ANNUAL OR TRANSITIONAL REPORT UNDER
SECTION 13 OR 15(d)
(As last amended by 34-31905, eff. 4/26/93)
FORM 10-KSB
[X] ANNUAL REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF
1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1996
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT
OF 1934 [NO FEE REQUIRED]
For the transition period.........to.........
Commission file number 0-15758
JACQUES-MILLER INCOME FUND, L.P. II
(Name of small business issuer in its charter)
Delaware 62-1244325
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
102 Woodmont Boulevard, Suite 420
Nashville, Tennessee 37205
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (864) 239-1000
Securities registered under Section 12(b) of the Exchange Act:
None
Securities registered under Section 12(g) of the Exchange Act:
Units of Limited Partnership Interest
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act of 1934 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
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]
State issuer's revenues for its most recent fiscal year. $1,778,000
State the aggregate market value of the voting partnership interests by non-
affiliates computed by reference to the price at which the partnership interests
were sold, or the average bid and asked prices of such partnership interests, as
of December 31, 1996. Market value information is not available. Should a
trading market develop for these interests, it is the corporate general
partner's belief that such a trading would not exceed $25 million.
DOCUMENTS INCORPORATED BY REFERENCE
1. Portions of the Prospectus of Registrant dated October 16, 1985 (included in
Registration Statement, No.2-99745, of Registrant) are incorporated by
reference into Parts I and III.
PART I
Item 1. Description of Business
Jacques-Miller Income Fund L.P. II ("Registrant" or "Partnership") is a Delaware
limited partnership formed in July 1985 for the purpose of making first mortgage
loans, wrap-around mortgage loans and other loans secured directly or indirectly
by interests in real property substantially all of which may be made to
affiliated public and private real estate limited partnerships. The Registrant
has made loans providing, generally, for repayment of principal between 8 and 15
years after funding.
The offering of the Registrant's limited partnership interests (the "Interests")
terminated on October 15, 1987. The Registrant received gross proceeds from the
offering of approximately $12,390,000 and net proceeds of approximately
$11,200,000.
See "Item 6. Management's Discussion and Analysis or Plan of Operation" for more
information.
Mansion Hill Apartments in Chattanooga, Tennessee, and Kingswood North
Apartments in Norcross, Georgia, were acquired during 1990 through foreclosure
proceedings. During 1991, these properties were sold. During 1991, the
Registrant acquired La Plaza Apartments ("La Plaza") through similar foreclosure
proceedings and during 1992, Willow Oaks Apartments ("Willow Oaks") and Brighton
Way Apartments ("Brighton Way") were foreclosed upon by separate limited
partnerships of which the Registrant is the sole limited partner. On February
1, 1993, Brighton Way was sold, and on January 17, 1995, Willow Oaks was sold.
Also, on May 24, 1996, La Plaza was sold.
Effective June 30, 1989, Jacques-Miller, Inc. sold the economic benefits and
economic rights in Jacques-Miller sponsored limited partnerships, including the
Registrant, to Balanced Holdings Partners, L.P., an affiliate. Effective
December 31, 1991, an affiliate of Insignia Financial Group, Inc. ("Insignia")
of Greenville, South Carolina acquired substantially all of the assets of
Jacques-Miller, Inc.; however, such assets purchased do not include the General
Partner Interest of the Registrant.
The Registrant has no employees. Management and administrative services are
performed by Insignia Residential Group, L.P., an affiliate of Insignia,
pursuant to management and administrative agreements.
Item 2. Description of Properties
As of May 24, 1996, the Partnership no longer owns any investments in real
estate due to the sale of its final investment property, La Plaza.
See "Note D" of the financial statements included in "Item 7." for a description
of the sale.
Item 3. Legal Proceedings
The Partnership is not aware of any pending or outstanding litigation that is
not of a routine nature. The General Partner believes that all such matters are
adequately covered by insurance and will be resolved without a material effect
upon the business, financial condition, statements of operations or liquidity of
the Partnership.
Item 4. Submission of Matters to a Vote of Security Holders
The Registrant did not submit any matter to a vote of its security holders
during the fiscal year covered by this report.
PART II
Item 5. Market for Partnership Equity and Related Partner Matters
There is no established market for the Units and it is not anticipated that any
will develop in the foreseeable future. As of December 31, 1996, there were
1,218 holders of record owning an aggregate of 12,400 Units.
Pursuant to the terms of the Partnership Agreement, there are restrictions on
the ability of the Limited Partners to transfer their Units. In all cases the
General Partner must consent to any transfer.
The Revenue Act of 1987 contained provisions which have an adverse impact on
investors in "publicly traded partnerships". Accordingly, the General Partner
has established a policy of imposing limited restrictions on the transferability
of the Units in secondary market transactions. Implementation of this policy
should prevent a public trading market from developing and may impact the
ability of an investor to liquidate his investment quickly. It is expected that
such policy will remain in effect until such time, if ever, as further
clarification of the Revenue Act of 1987 may permit the Registrant to lessen the
scope of the restrictions.
During 1995, the Partnership distributed approximately $1,851,000 to the limited
partners and approximately $21,000 to the general partner due to the sale of
Willow Oaks. During 1996, the Partnership distributed approximately $917,000 to
the limited partners and approximately $9,000 to the general partner due to the
sale of La Plaza. There are no material restrictions upon the Registrant's
present or future ability to make distributions in accordance with the
provisions of the Registrant's Partnership Agreement.
Item 6. Management's Discussion and Analysis or Plan of Operation
This item should be read in conjunction with the consolidated financial
statements and other items contained elsewhere in this report.
Results of Operations
The Partnership's net income as reported in the financial statements for the
year ended December 31, 1996, was approximately $1,213,000 compared to net
income of approximately $738,000 for the year ended December 31, 1995 (see "Note
E" of the financial statements for a reconciliation of these amounts to the
Partnership's federal taxable income). The increase in net income for the year
ended December 31, 1996, is primarily attributable to the gain of approximately
$1,348,000 on the sale of La Plaza Apartments, which occurred on May 24, 1996.
Although Willow Oaks Apartments was sold in 1995, the gain realized from that
sale was only approximately $856,000. Offsetting the gain on the sale of La
Plaza Apartments was the recognition of an extraordinary loss on the early
extinguishment of debt of approximately $221,000 due to the write-off of
unamortized loan costs and mortgage discount. Also, operating, general and
administrative, interest, depreciation, maintenance, and property tax expense
all decreased for the year ended December 31, 1996, due to the sale of La Plaza
Apartments. This was partially offset by a decrease in rental income for the
year ended December 31, 1996, also due to the sale of La Plaza. Included in
maintenance expense is approximately $21,000 of major repairs and maintenance
comprised primarily of exterior building and parking lot repairs.
Liquidity and Capital Resources
At December 31, 1996, the Partnership held unrestricted cash of approximately
$736,000 compared to approximately $586,000 at December 31, 1995. Net cash
provided by operating activities increased as a result of the increase in net
income as previously described and a decrease in accrued taxes and accounts
payable due to the fact that the Partnership no longer owns any investment
properties. Net cash provided by investing activities decreased primarily due
to a decrease in the proceeds received from the sale of investment properties.
The Partnership recognized proceeds of approximately $1,613,000 in January 1995,
from the sale of Willow Oaks as compared to proceeds of approximately $927,000
from the sale of La Plaza in May 1996. Also, the decrease is attributable to the
decrease in receipts from restricted escrows in 1996. In 1995, these receipts
were used to fund roof replacement costs. Net cash used in financing activities
decreased primarily due to a decrease in distributions in 1996. The Partnership
made distributions of approximately $1,872,000 during 1995. In August 1996, the
Partnership paid distributions of approximately $926,000 to the partners.
On May 24, 1996, Jacques-Miller Income Fund II Special Asset Partnership (La
Plaza) L.P., which is 99.9% owned by the Partnership, sold La Plaza Apartments,
located in Altamonte Springs, Florida, to an unaffiliated purchaser, Wymore
Equity Associates, L.C., a Florida limited liability company. Wymore Equity
Associates, L.C. purchased La Plaza Apartments for a contract price of $3.2
million. Included as part of this purchase price is the assumption of
approximately $1,984,000 in first and second mortgage debt. The Partnership
received net proceeds of approximately $927,000 after payment of closing costs.
This disposition resulted in a gain of approximately $1,348,000 and a loss on
early extinguishment of debt of approximately $221,000 due to the write-off of
unamortized loan costs and mortgage discount.
During 1996 the Partnership agreed to accept a payment of approximately $78,000
in 1997 as full satisfaction of the two notes receivable on Governour's Square.
The outstanding balances for these two notes receivable totaled approximately
$296,000, including accrued interest, and were fully reserved. Governour's
Square sold its sole operating property and the majority of the sales proceeds
were used to pay off the first mortgage.
The Partnership holds five notes receivable at December 31, 1996, totaling
approximately $1,422,000 with approximately $1,386,000 of related accrued
interest, all of which is fully reserved. Included in the provision for
uncollectibles is approximately $1,030,000 of deferred interest revenue. Four
of the five notes in the principal amount of approximately $1,023,000 are due
from related partnerships. These four promissory notes are unsecured by the
related partnerships and are subordinated to the underlying mortgages of the
respective partnerships. Payments on these notes are restricted to excess cash
flow after payment of the first and second mortgages. No payments were received
in 1996 or 1995. Future payments are dependent on excess cash flows from the
properties or sales proceeds.
Future cash distributions will depend on the levels of net cash generated from
operations and the availability of cash reserves. During the year ended
December 31, 1996, a distribution of approximately $926,000 was paid to the
partners in connection with the sale of La Plaza. During the year ended
December 31, 1995, a distribution of approximately $1,872,000 was paid to the
partners in connection with the sale of Willow Oaks Apartments. The General
Partner is currently attempting to sell the notes receivable.
Item 7. Financial Statements
JACQUES-MILLER INCOME FUND, L.P. II
LIST OF CONSOLIDATED FINANCIAL STATEMENTS
Report of Independent Auditors
Consolidated Balance Sheet--December 31, 1996
Consolidated Statements of Operations--Years ended December 31, 1996 and
1995
Consolidated Statements of Changes in Partners' Capital (Deficit)--Years
ended December 31, 1996 and 1995
Consolidated Statements of Cash Flows--Years ended December 31, 1996 and
1995
Notes to Consolidated Financial Statements
Report of Ernst & Young LLP, Independent Auditors
The Partners
Jacques-Miller Income Fund, L.P. II
We have audited the accompanying consolidated balance sheet of Jacques-Miller
Income Fund, L.P. II (A Limited Partnership) as of December 31, 1996, and the
related consolidated statements of operations, changes in partners' capital
(deficit) and cash flows for each of the two years in the period ended December
31, 1996. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by the
Partnership's management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Jacques-Miller
Income Fund, L.P. II (A Limited Partnership) as of December 31, 1996, and the
consolidated results of its operations and its cash flows for each of the two
years in the period ended December 31, 1996, in conformity with generally
accounting principles.
/s/ERNST & YOUNG LLP
Greenville, South Carolina
February 27, 1997
JACQUES-MILLER INCOME FUND, L.P. II
CONSOLIDATED BALANCE SHEET
(in thousands)
December 31, 1996
Assets
Cash and cash equivalents $ 736
Notes receivable (net of allowance of
approximately $2,808,000) 78
$ 814
Liabilities and Partners' Capital (Deficit)
Liabilities
Other liabilities $ 22
Partners' Capital (Deficit)
General partner $ (106)
Limited partners (12,400
units issued and outstanding) 898 792
$ 814
See Accompanying Notes to Consolidated Financial Statements
JACQUES-MILLER INCOME FUND, L.P. II
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
Years Ended December 31,
1996 1995
Revenues:
Rental income $ 290 $ 776
Other income 140 97
Gain on sale of property 1,348 856
Total revenues 1,778 1,729
Expenses:
Operating 147 376
General and administrative 44 119
Maintenance 56 106
Depreciation -- 118
Interest 73 204
Property taxes 24 68
Total expenses 344 991
Income before extraordinary item 1,434 738
Extraordinary item-loss on early extinguishment of debt (221) --
Net income $ 1,213 $ 738
Net income allocated to general partner (1%) $ 12 $ 7
Net income allocated to limited partners (99%) 1,201 731
$ 1,213 $ 738
Per limited partnership unit:
Income before extraordinary item $114.52 $58.91
Extraordinary item - loss on early extinguishment of debt (17.63) --
Net income per limited partnership unit $ 96.89 $58.91
See Accompanying Notes to Consolidated Financial Statements
JACQUES-MILLER INCOME FUND, L.P. II
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(in thousands, except unit data)
Limited
Partnership General Limited
Units Partner Partners Total
Partners' capital (deficit) at
December 31, 1994 12,400 $ (95) $1,734 $ 1,639
Net income for the year
ended December 31, 1995 7 731 738
Distributions (21) (1,851) (1,872)
Partners' capital (deficit)
at December 31, 1995 12,400 (109) 614 505
Net income for the year ended
December 31, 1996 12 1,201 1,213
Distributions
(9) (917) (926)
Partners' capital (deficit) at
December 31, 1996 12,400 $(106) $ 898 $ 792
See Accompanying Notes to Consolidated Financial Statements
JACQUES-MILLER INCOME FUND, L.P. II
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Years Ended December 31,
1996 1995
Cash flows from operating activities:
Net income $ 1,213 $ 738
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation -- 118
Amortization of discounts and loan costs 13 31
Gain on sale of property (1,348) (856)
Extraordinary item - loss on early
extinguishment of debt 221 --
Change in accounts:
Restricted cash 26 61
Accounts receivable -- 5
Notes receivable (78) --
Escrows for taxes 17 139
Other assets 11 (5)
Accounts payable (38) (159)
Tenant security deposit liabilities 2 (64)
Accrued taxes -- (176)
Other liabilities 33 (46)
Net cash provided by (used in)
operating activities 72 (214)
Cash flows from investing activities:
Property improvements and replacements (13) (42)
Deposits to restricted escrows (15) (49)
Receipts from restricted escrows 126 463
Proceeds from sale of investment property 927 1,613
Net cash provided by investing activities 1,025 1,985
Cash flows from financing activities:
Payments on mortgage notes payable (21) (57)
Distributions (926) (1,872)
Net cash used in financing activities (947) (1,929)
Net increase (decrease) in cash 150 (158)
Cash and cash equivalents at beginning of year 586 744
Cash and cash equivalents at end of year $ 736 $ 586
Supplemental disclosure of cash
flow information:
Cash paid for interest $ 67 $ 191
See Accompanying Notes to Consolidated Financial Statements
Supplemental Disclosure of Non-Cash Activity
Property Improvements and Replacements
Notes receivable were adjusted approximately $166,000 and $268,000 at December
31, 1996, and 1995, respectively for non-cash amounts in connection with accrued
interest on the notes receivable. This amount was fully reserved.
Note A - Organization and Significant Accounting Policies
Organization: Jacques-Miller Income Fund, L.P. II (the "Partnership") is a
Delaware limited partnership organized in December 1985 to make long-term junior
mortgage loans, including wraparound mortgage loans and, to a lesser extent,
other mortgage loans including first mortgage loans primarily to affiliated
public and private real estate limited partnerships. The Partnership currently
holds five notes receivable.
Principles of Consolidation: The financial statements include all the accounts
of the Partnership and its one 99.9% owned partnership. All significant
interpartnership balances have been eliminated.
Use of Estimates: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Allocations to Partners: Net income (loss) of the Partnership and taxable
income (loss) are allocated 99% to the limited partners and 1% to the general
partner. Distributions of available cash, as defined by the partnership
agreement, are allocated among the limited partners and the general partner in
accordance with the agreement of limited partnership.
Cash and Cash Equivalents: It is the Partnership's policy to classify all
highly liquid investments with an original maturity of three months or less as
cash equivalents. At certain times, the amount of cash deposited at a bank may
exceed the limit on insured deposits.
Deferred Revenue: Deferred revenue results from accrued but unpaid interest
receivable, realization of which is dependent upon appreciation of the property
which collateralizes the receivable. The net interest revenue is recognized
when collectibility is assured.
Depreciation: Depreciation was provided by the straight-line method over the
estimated lives of the apartment properties and related personal property. For
Federal income tax purposes, as a result of the Tax Reform Act of 1986, the
modified accelerated cost recovery method was used for depreciation of (1) real
property over 27 1/2 years and (2) personal property additions over 7 years.
Leases: The Partnership generally leased apartment units for twelve-month terms
or less. The Partnership recognized income as earned on its leases.
Investment Properties: In March 1995, the FASB issued "Statement No. 121,
Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed of" ("Statement 121"), which requires impairment losses to be
recorded on long-lived assets used in operation when indicators of impairment
are present and the undiscounted cash flows estimated to be generated by those
assets are less than the assets' carrying amount. Statement 121 also addresses
the accounting for long-lived assets that are expected to be disposed of. The
Partnership adopted Statement 121 in 1996; the effect of adoption was not
material.
Advertising: The Partnership expenses the costs of advertising as incurred.
Advertising expense, included in operating expenses, was approximately $3,000
and $29,000 for the years ended December 31, 1996 and 1995, respectively.
Fair Value: The carrying amount of the Partnership's cash and cash equivalents
approximates fair value due to short-term maturities. Management of the
Partnership believes the carrying amount of the notes receivable approximates
their fair value.
Reclassifications: Certain reclassifications have been made to the 1995
information to conform to the 1996 presentation.
Note B - Notes Receivable
Notes receivable consist of (in thousands):
December 31,
1996
Notes receivable $ 1,500
Accrued interest receivable on
notes receivable 1,386
2,886
Provision for uncollectibles
(including approximately $1,030,000
of deferred interest revenue) (2,808)
$ 78
The Partnership holds five notes receivable at December 31, 1996, totaling
approximately $1,422,000 with approximately $1,386,000 of related accrued
interest, all of which is fully reserved. Included in the provision for
uncollectibles is approximately $1,030,000 of deferred interest revenue. Four
of the five notes in the principal amount of approximately $1,023,000 are due
from related partnerships. These four promissory notes bear interest at rates
ranging from 11% to 12.5%, and are unsecured by the related partnerships and are
subordinated to the underlying mortgages of the respective partnerships.
During 1996, the Partnership agreed to accept a payment of approximately $78,000
in 1997 as full satisfaction of the two notes receivable on Governour's Square.
The outstanding balances for these two notes receivable totaled approximately
$296,000, including accrued interest, and were fully reserved. Governour's
Square sold its sole operating property and the majority of the sales proceeds
were used to pay off the first mortgage. The income was recorded as a result of
the reduction in the allowance on the notes and is included in other income on
the 1996 statement of operations.
During 1996, one of the five notes became due and was in default at December 31,
1996. Another note became due and was in default at January 1, 1997. The other
three notes are scheduled to mature in 1997. The General Partner is currently
attempting to sell all of the remaining notes.
Note C - Sale of Willow Oaks
On January 17, 1995, Jacques-Miller Income Fund II Special Asset Partnership
(Willow Oaks), L.P., which was 99.9% owned by the Partnership, sold Willow Oaks
to an unaffiliated purchaser, Willow Bryan Apartments, L.P., a Delaware limited
partnership. The buyer assumed the mortgages which totaled approximately
$5,439,000 including interest. The Partnership received net proceeds of
approximately $1,613,000 after payment of closing costs. This disposition
resulted in a gain of approximately $856,000. Revenues and expenses from Willow
Oaks were approximately $90,000 and $80,000, respectively, in 1995. The
Partnership dissolved Willow Oaks in 1995.
Note D - Sale of La Plaza
On May 24, 1996, Jacques-Miller Income Fund II Special Asset Partnership (La
Plaza) L.P., which is 99.9% owned by the Partnership, sold La Plaza Apartments,
located in Altamonte Springs, Florida, to an unaffiliated purchaser, Wymore
Equity Associates, L.C., a Florida limited liability company. Wymore Equity
Associates, L.C. purchased La Plaza Apartments for a contract price of $3.2
million. Included as part of this purchase price is the assumption of
approximately $1,984,000 in first and second mortgage debt. The Partnership
received net proceeds of approximately $927,000 after payment of closing costs.
This disposition resulted in a gain of approximately $1,348,000 and a loss on
early extinguishment of debt of approximately $221,000 due to the write-off of
unamortized loan costs and mortgage discount. The Partnership will dissolve
LaPlaza in 1997.
Revenues and expenses from La Plaza were approximately $328,000 and $299,000,
respectively, in 1996 and approximately $758,000 and $791,000, respectively, in
1995.
Note E - Income Taxes
The Partnership has received a ruling from the Internal Revenue Service that it
will be classified as a partnership for federal income tax purposes.
Accordingly, no provision for income taxes is made in the financial statements
of the Partnership. Taxable income or loss of the Partnership is reported in the
income tax returns of its partners.
The following is a reconciliation of reported net income and Federal taxable
income (loss) (in thousands, except unit data):
1996 1995
Net income as reported $ 1,213 $ 738
Add (deduct):
Depreciation differences (44) 17
Bad debt (194) --
Disposal of property (39) 68
Other 4 (1)
Federal taxable income $ 940 $ 822
Federal taxable income
per limited partnership unit $ 75.07 $65.66
The following is a reconciliation between the Partnership's reported amounts
and Federal tax basis of net assets and liabilities (in thousands):
Net assets as reported $ 792
Allowance for doubtful accounts 1,778
Other 22
Net assets - Federal tax basis $2,592
Note F - Transactions with Affiliated Parties
The Partnership has outstanding notes receivable with affiliated partnerships.
During 1996, the Partnership agreed to accept a payment of approximately $78,000
in 1997 in full satisfaction of the two notes receivable on Governour's Square.
The outstanding balances for these two notes receivable totaled approximately
$296,000, including accrued interest, and were fully reserved.
Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
PART III
Item 9. Directors and Executive Officers of the Partnership
The General Partner of the Registrant is:
Jacques-Miller, Inc., a Tennessee Corporation
Jacques-Miller, Inc., the Managing General Partner, was formed under the laws
of the State of Tennessee in 1972.
The principal executive officer and director of the Managing General Partner
is:
Name Age Position
C. David Griggin 50 President, Chief Operating Officer and
Director
Biographies
C. David Griffin. Mr. Griffin became President and Chief Operating Officer of
Jacques-Miller, Inc. in August 1987. He is an officer and director of Jacques-
Miller Property Management, Inc. and several other wholly owned subsidiaries of
Jacques-Miller, Inc., all of which render ancillary services to the partnerships
sponsored by the General Partner.
Balanced Holding Partners, L.P. Transaction
In December of 1989, Balanced Holdings Partners, L.P., a Delaware limited
partnership ("BHP"), purchased from Jacques-Miller, Inc. and certain of its
subsidiaries ("Jacques-Miller") certain real estate assets, which included,
among other things, the general partner's economic benefits and economic rights
in Jacques-Miller sponsored limited partnerships, including the Registrant.
Jacques-Miller remained as the general partner, but was indemnified by BHP to
the full extent of BHP's assets up to a maximum aggregate amount of $2,000,000
of which approximately all has been utilized.
As the general partner, Jacques-Miller itself remains liable for the recourse
obligations of the Registrant to the extent that the Registrant's cash flow and
assets become insufficient to meet Registrant's obligations, and could be
required to make payments on behalf of the Registrant in such events.
As the general partner, Jacques-Miller receives a residual interest in the
proceeds of the disposition of Registrant's assets, typically computed as a
percentage of net proceeds from the sale or refinancing of partnership assets
and subordinated to the recovery by the limited partners of their investments
plus a specified cumulative annual return. Jacques-Miller effectively sold all
of its residual interest to BHP in connection with this transaction.
Insignia Transaction
On December 31, 1991, an affiliate of Insignia Financial Group, Inc.
("Insignia") acquired substantially all of the assets of Jacques-Miller, Inc.
(the General partner Interest of the Registrant) including Jacques-Miller's
property management organization. However, the General Partner Interest of
Registrant was not acquired during this transaction. As a result of a separate
Advisory Agreement between the Registrant and IFGP Corporation (an affiliate of
Insignia) Insignia and its affiliates succeeded to those asset management and
property management duties previously performed by Jacques-Miller.
Item 10. Executive Compensation
The Registrant was not required to and did not pay remuneration to officers
and/or directors of the Managing General Partner during 1996 or 1995. See "Item
12. Certain Relationships and Related Transactions" below for a discussion of
compensation and reimbursements paid to the General Partner and certain
affiliates.
Item 11. Security Ownership of Certain Beneficial Owners and Management
No person or group is known by the Registrant to own beneficially more than 5%
of the outstanding Interests of Registrant, as of December 31, 1996.
No officer or director of the General Partner of the Registrant owns, nor do the
officers or directors as a group own, any of the Registrant's Interests as of
December 31, 1996. No officer or director of the General Partner possesses a
right to acquire beneficial ownership of Interests of the Registrant.
Item 12. Certain Relationships and Related Transactions
None.
Item 13. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report.
(b) Reports on Form 8-K filed in the fourth quarter of fiscal year 1996:
None.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
JACQUES-MILLER INCOME FUND, L.P. II
By: Jacques-Miller, Inc.
Corporate General Partner
BY: /s/C. David Griffin
C. David Griffin
President and Chief Operating
Officer
Date: March 20, 1997
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
date indicated.
/s/C. David Griffin President and Chief Operating
C. David Griffin Officer (Principal Executive Officer)
EXHIBIT INDEX
Exhibit
3 Partnership Agreement is incorporated by reference to Exhibit A of the
Prospectus contained in the Registrant's Registration Statement (2-99745)
as filed with the Commission pursuant to Rule 424(b) under the Act.
4 Form of Certificate representing interests in the Registrant. [Exhibit 4
to Registration Statement on Form S-11 dated October 16, 1985,
Registration Number 2-99745 is incorporated herein by reference.]
10A Promissory Note dated July 20, 1990 in the amount of $476,000.00 payable
to the Registrant executed by Balanced Holding Partners, L.P. [Filed as
Exhibit 10A to Form 10K for the year ended December 30, 1990, and
incorporated herein by reference.]
10B Settlement Agreement dated July 25, 1991 between Jacques-Miller Income
Fund L.P. II and Balanced Holdings Partners, L.P., Jacques-Miller, Inc.,
and Jacques-Miller Mortgage, Inc. of Tennessee. [Filed as Exhibit 10B to
Form 10K for the year ended December 31, 1991, and incorporated herein by
reference.]
10C Advisory Agreement, dated December 30, 1991, between Jacques-Miller
Income Fund L.P. II and Insignia GP Corporation. [Filed as Exhibit 10C
to Form 10K for the year ended December 31, 1991, and incorporated herein
by reference.]
10D Contracts related to refinancing of debt:
(a) First Mortgage and Security Agreement dated October 28, 1992 between
Jacques-Miller Income Fund II Special Asset Partnership (La Plaza),
L.P. and First Commonwealth Realty Credit Corporation, a Virginia
Corporation, securing La Plaza Apartments. *
(b) First Deed of Trust and Security Agreement dated October 28, 1992
between Jacques-Miller Income Fund II Special Asset Partnership
(Willow Oaks), L.P. and First Commonwealth Realty Credit Corporation,
a Virginia Corporation, securing Willow Oaks Apartments. *
(c) Second Mortgage and Security Agreement dated October 28, 1992 between
Jacques-Miller Income Fund II Special Asset Partnership (La Plaza),
L.P. and First Commonwealth Realty Credit Corporation, a Virginia
Corporation, securing La Plaza Apartments.
(d) Second Deed of Trust and Security Agreement dated October 28, 1992
between Jacques-Miller Income Fund II Special Asset Partnership
(Willow Oaks), L.P. and First Commonwealth Realty Credit Corporation,
a Virginia Corporation, securing Willow Oaks Apartments. *
(e) First Assignment of Leases and Rents dated October 28, 1992 between
Jacques-Miller Income Fund II Special Asset Partnership (La Plaza),
L.P. and First Commonwealth Realty Credit Corporation, a Virginia
Corporation, securing La Plaza Apartments. *
(f) First Assignment of Leases and Rents dated October 28, 1992 between
Jacques-Miller Income Fund II Special Asset Partnership (Willow Oaks),
L.P. and First Commonwealth Realty Credit Corporation, a Virginia
Corporation, securing Willow Oaks Apartments. *
(g) Second Assignment of Leases and Rents dated October 28, 1992 between
Jacques-Miller Income Fund II Special Asset Partnership (La Plaza),
L.P. and First Commonwealth Realty Credit Corporation, a Virginia
Corporation, securing La Plaza Apartments. *
(h) Second Assignment of Leases and Rents dated October 28, 1992 between
Jacques-Miller Income Fund II Special Asset Partnership (Willow Oaks),
L.P. and First Commonwealth Realty Credit Corporation, a Virginia
Corporation, securing Willow Oaks Apartments. *
(i) First Mortgage Note dated October 28, 1992 between Jacques-Miller
Income Fund II Special Asset Partnership (La Plaza), L.P. and First
Commonwealth Realty Credit Corporation, relating to La Plaza
Apartments. *
(j) First Deed of Trust Note dated October 28, 1992 between Jacques-Miller
Income Fund II Special Asset Partnership (Willow Oaks), L.P. and First
Commonwealth Realty Credit Corporation, relating to Willow Oaks
Apartments. *
(k) Second Mortgage Note dated October 28, 1992 between Jacques-Miller
Income Fund II Special Asset Partnership (La Plaza), L.P. and First
Commonwealth Realty Credit Corporation, relating to La Plaza
Apartments. *
(l) Second Deed of Trust Note dated October 28, 1992 between Jacques-
Miller Income Fund II Special Asset Partnership (Willow Oaks), L.P.
and First Commonwealth Realty Credit Corporation, relating to Willow
Oaks Apartments. *
* Filed as Exhibits 10D (a) through (l), respectively, to Form 10KSB for
the year ended December 31, 1992 and incorporated herein by reference.
21 Subsidiaries of the Registrant
27 Financial Data Schedule
99A Agreement of Limited Partnership for Jacques-Miller Income Fund II
Special Asset Partnership (La Plaza), L.P. between Jacques-Miller, Inc.
and Jacques-Miller Income Fund II, L.P. entered into August 21, 1991.
[Filed as Exhibit 28A to Form 10KSB for the year ended December 31,
1992, and incorporated herein by reference.]
99B Agreement of Limited Partnership for Jacques-Miller Income Fund II
Special Asset Partnership (Willow Oaks), L.P. between Jacques-Miller,
Inc. and Jacques-Miller Income Fund II, L.P. entered into December 16,
1991. [Filed as Exhibit 28B to Form 10KSB for the year ended December
31, 1992, and incorporated herein by reference.]
99C Agreement of Limited Partnership for Jacques-Miller Income Fund II
Special Asset Partnership (Brighton Way), L.P. between Jacques-Miller,
Inc. and Jacques-Miller Income Fund II, L.P. entered into December 16,
1991. [Filed as Exhibit 28C to Form 10KSB for the year ended December
31, 1992, and incorporated herein by reference.]
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
Jacques-Miller Income Fund, L.P. II 1996 Year-End 10-KSB and is qualified in its
entirety by reference to such 10-KSB filing.
</LEGEND>
<CIK> 0000774655
<NAME> JACQUES-MILLER INCOME FUND, L.P. II
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 736
<SECURITIES> 0
<RECEIVABLES> 78
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 814
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 792
<TOTAL-LIABILITY-AND-EQUITY> 814
<SALES> 0
<TOTAL-REVENUES> 1,778
<CGS> 0
<TOTAL-COSTS> 344
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 73
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> (221)
<CHANGES> 0
<NET-INCOME> 1,213
<EPS-PRIMARY> 96.89<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
</TABLE>
