UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarter Ended June 30, 1999 Commission file number: 33-2121
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
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(Exact name of registrant as specified in its charter)
ARIZONA 86-0540409
- --------------------------------- ---------------------------------
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
2999 N. 44th Street, Suite 450, Phoenix, Arizona 85018
- ------------------------------------------------ ----------
(Address of principal executive offices) (Zip Code)
(602) 955-4000
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(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 (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. [X] yes [ ] no
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. [X] yes [ ] no
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
Balance Sheet
As of June 30, 1999
Unaudited
ASSETS
Current Assets
Cash $1,185,470.98
-------------
Total Current Assets 1,185,470.98
Land-Baseline & 24th St 2,030,417.39
Land-Peoria & 79th Ave 984,383.98
Land-Baseline & 32nd St 1,139,148.04
Land-Central Ave/Avondale 125,472.02
Land-Van Buren & Central 1,302,319.75
-------------
Total Land 5,581,741.18
Other Assets 859,495.75
-------------
TOTAL ASSETS $7,626,707.91
=============
LIABILITIES
Accounts Payable $ 51,882.79
-------------
Total Liabilities 51,882.79
CAPITAL
Partners' Capital 7,574,825.12
-------------
TOTAL LIABILITIES & CAPITAL $7,626,707.91
=============
2
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
Income Statement
for the Three Months' Ending June 30, 1999
Unaudited
Three
Months Ended
June 30, 1999 Year to Date
------------- ------------
INCOME
Rental Income $ 300.00 $ 600.00
Sales Proceeds -- 588,586.50
Cost of Sales -- (1,477,603.38)
Interest Income 12,220.54 22,150.82
Transfer Fees 1,015.00 1,540.00
Misc. Income 35,041.13 35,041.13
---------- --------------
Total Income 48,576.67 (829,684.93)
EXPENSE
Insurance Expense -- 56.00
Interest Expense -- --
Accounting Expense 4,330.00 14,682.50
Legal Expense 20,659.18
Management Fees 10,472.09 26,887.35
Office Expense -- 25.20
Outside Service 4,624.24 6,784.24
Printing 1,172.75 2,425.18
Postage 38.25 1,441.10
Property Tax 9,730.57 19,434.04
Telephone Expense 22.66 34.84
Trustee Fees 2,750.00 3,250.00
Utilities 245.00 245.00
---------- --------------
Total Expenses 33,385.56 95,924.63
---------- --------------
Profit/Loss $15,191.11 $ (925,609.56)
========== ==============
3
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
PART 1: FINANCIAL INFORMATION
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF PARTNERSHIP
TPI Land Development III Limited Partnership is a limited partnership
formed during 1986 under the laws of the State of Arizona. The Partnership
reached impound on May 27, 1986.
DURATION OF PARTNERSHIP
It has been the intention of the Partnership to acquire property for
investment appreciation purposes. The partnership intends to sell a portion
or all of the properties in the future with a view towards liquidation of
the Partnership. If not terminated prior to December 31, 2001, the
Partnership shall cease to exist at that date.
OTHER ASSETS
Organizational costs represent costs incurred during the formation period
of the Partnership. Organizational costs total $55,663.00. Organizational
costs were amortized over 60 months, and are fully amortized. Syndication
costs represent commissions incurred on the sale of limited partnership
interests and the costs of preparing the prospectuses. Syndication costs
total $31,415.83. Syndication costs are not amortized. Land purchase costs
not previously allocated represent commissions, legal expenses, and other
expenses incurred during the acquisition of the land. Current unallocated
land purchase costs total $828,079.92. The allocation of land purchase
costs to total costs of sale when a parcel is sold is based on the parcel's
original contract price as a percentage of total contract prices of all
remaining parcels.
4
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES
No provision for income tax is made for the Partnership since the reporting
and payment of income tax is the responsibility of the individual partners.
PARTNERS' PREFERRED RETURN ON CAPITAL CONTRIBUTIONS
The preferred return clause was deleted in the Amendments to Agreement of
Limited Partnership of TPI Land Development III Limited Partnership, dated
January 1998.
ALLOCATION OF NET PROFITS, LOSSES, AND DISTRIBUTIONS TO PARTNERS
Net profits/losses (prepared on an accrual basis), and distributions are
allocated to the limited and general partners in accordance with their
respective capital percentages per Amendments to Agreement of Limited
Partnership of TPI Land Development III Limited Partnership, (paragraph
4.1.a), dated January 1998.
NOTE 2: LAND
Costs incurred by the Partnership for acquisition and holding of land as of
March 31, 1999 are as follows:
24th St. & Baseline $2,030,417
79th Ave. & Peoria 984,384
32nd St. & Baseline 1,139,148
Central Ave./Avondale 125,472
Van Buren & Central/ Goodyear 1,302,320
----------
$5,581,741
==========
5
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
NOTE 2: LAND (CONTINUED)
One Triplex apartment building was sold November 1, 1994 for $50,000. Two
Triplex apartment buildings were sold on January 1, 1995 for $100,000.
Rental property was sold on May 23, 1995 for $44, 900. A corner pad (40,000
square feet) at 24th Street and Baseline, in Phoenix, AZ, was sold December
16, 1996 for $400,000. A portion (4 acres) of the property in Casa Grande,
AZ was sold November 11, 1998 for $348,480. The balance of the parcel
(8.775 acres) in Casa Grande, AZ was sold December 24, 1998 for $764,042.
The property in Chandler, AZ was sold February 3, 1999 for $588,586. The
Partnership received $35,000 from the City of Phoenix in payment of an
easement right for a 15,024 square foot alignment along 32nd Street at the
North East Corner of Baseline, Phoenix, AZ.
NOTE 3: PARTNERS' CAPITAL
Partners' capital contributions received and subscribed as of June 30, 1999
are as follows:
Limited partners' contribution $ 9,939,500
Prior years' profit (loss) (1,439,065)
Current year's profit (loss) (925,610)
-----------
Partners' Capital $ 7,574,825
===========
A prior period adjustment was made in 1996 to the prior year's profit
(loss) for $24,381. The previous general partner's original contribution of
$100,399 was in the form of a note payable. The note was written off with
the removal of the general partner and all of his interests. Limited
partners' original contributions were adjusted accordingly. The accounts
receivable balance of $2,079 due to the general partner was written off and
the current year's loss adjusted. The note and the receivable netted in
effect and the capital account was corrected.
6
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
NOTE 4: The partnership is obligated under a Promissory Note dated May 3,
1993, with West Financial Corp. for $285,000. Interest of 14.9% per
annum is paid in monthly installments of $3,538.75 with the remaining
principal and interest due and payable on July 1, 1996. West
Financial Corp. assigned all rights, title and interest in the
Promissory Note and beneficial interest under the Deed of Trust to
Bolco Limited Partnership, in an agreement dated February 12, 1996.
The agreement extends the remaining interest due and payable to June
1, 1997. A $70,000 principal payment was made with proceeds from the
December 16, 1996 sale of a corner pad of the 24th Street and
Baseline, Phoenix, AZ, parcel. In addition, interest was paid in the
amount of $16,202.20. Further, an additional sum of $9,895.28 was
erroneously impounded by the title company. Both parties agreed to
apply $8,395.28 to principal of the note, and to apply $1,500 towards
attorney's fees per the following stipulation: The United States
Bankruptcy Court in the District of Arizona, Chapter 11 issued an
"Order Approving Stipulation Regarding Secured Claim of Bolco Ltd.
Partnership" dated January 15, 1997. The Order extended the maturity
date on the Promissory Note through and including February 2, 1998,
provided a plan of reorganization was filed with the Court on or
before August 1, 1997. All other terms of the original agreement are
upheld. The note was paid in full including principal and interest in
the amount of $272,425.88 on December 30, 1998, at which time a
Release of All Claims was filed and executed. On March 10, 1999 a
fully executed Satisfaction of Deed of Trust, Direction for
Reconveyance and Deed of Release and Reconveyance executed by Bolco
Ltd. Partnership was received.
7
<PAGE>
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
NOTE 5: The tri-plex rental property was readied for a pending sale. A short
term loan from TPI Secured Income 89B was needed in addition to
existing cash reserves to prepare the property for sale. The loan was
repaid on February 1, 1995.
NOTE 6: The Partnership has loaned the sum of $39,500 to an unrelated entity
under a Promissory Note dated August 31, 1993. Interest of 15% per
annum is due monthly and accrues to principal if unpaid monthly. The
Note was foreclosed upon on July 13, 1994 and the property was
converted to an asset to be prepared for sale.
NOTE 7: The Partnership has loaned $25,000 to an unrelated party on October
8, 1993. Interest of 15% accrues to the principal with the balance
all due and payable October 4, 1994. The loan was repaid on October
18, 1994.
8
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATIONS
The partnership offering period ended December 31, 1987. From that date forward
the Partnership entered the operating stage which either held the properties for
appreciation or prepared the properties for disposition. Also during this
period, the final acquisitions were made.
As of June 30, 1999 the Partnership had $1,185,470.98 in cash and money market
instruments. The sources of revenue during the operating period were proceeds
from an easement sale, rental income, interest on the money market account and
transfer fees.
PART 2: OTHER INFORMATION
LEGAL PROCEEDINGS
A petition was filed on July 6, 1995 in the United States Bankruptcy Court for
the District of Arizona, Case No. 95-05828-PHX-CGC, for Chapter 11 Bankruptcy
protection. All parcels of real property are listed for sale, and are being
actively marketed. A plan of reorganization has been prepared and filed.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The general partners, Herve Tessier and TPI Asset Management, Inc., resigned and
have been replaced by the Investors Recovery Group, LLC, which was organized by
existing partners in TPI Land Development III Limited Partnership. The members
of the Investors Recovery Group, LLC are Lawrie Porter, Carl Harwood, Robert
Long, Elizabeth Kowoser, Donald Thomas, and Craig Stevenson. On May 10 and 11,
1996 a Notice of Settlement Agreement regarding the Resignation of General
Partners of TPI III; Notice of Hearing on Approval of Settlement Agreement
regarding Resignation of General Partners of TPI III; and Notice of Selection of
Successor General Partner of TPI III were mailed to all Limited Partners. The
settlement agreement was approved by a court order in the United States
Bankruptcy Court District of Arizona, Chapter 11, Case No. 95-5828-PHX-CGC on
May 24, 1996.
9
<PAGE>
SIGNATURES
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.
TPI LAND DEVELOPMENT III LIMITED PARTNERSHIP
By: /s/ Lawrie Porter
------------------------------
Lawrie Porter, Managing Member
Date: August 11, 1999
----------------------------
10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AT JUNE 30, 1999 AND THE STATEMENT OF OPERATIONS FOR THE THREE MONTHS
ENDED JUNE 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
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<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
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0
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