<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1995
OR
/ /TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _______________________ to ______________________
Commission file number: 1-9373
SUMMIT TAX EXEMPT BOND FUND, L.P.
--------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 13-3323104
--------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
625 Madison Ave., New York, N.Y. 10022
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 421-5333
N/A
--------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check CK 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 _CK_ No __
<PAGE>
<PAGE>
Part I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SUMMIT TAX EXEMPT BOND FUND, L.P.
(a limited partnership)
STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
<S> <C> <C>
---------------------------------------------------------------------------------------------------
ASSETS
Participating first mortgage bonds, net $ 128,003,516 $127,938,510
Temporary investments 1,885,693 1,915,874
Cash 398,529 173,689
Promissory notes receivable, net 6,968,137 7,071,156
Deferred bond selection fees, net 1,783,244 1,858,273
Interest receivable, net 929,997 944,367
Deferred financing fees, net 324,902 388,816
Other assets 37,334 13,628
------------- ------------
Total assets $ 140,331,352 $140,304,313
------------- ------------
------------- ------------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Loan payable $ 13,680,866 $ 13,680,866
Deferred income 1,300,214 1,469,174
Due to affiliates 309,287 46,422
Accrued interest payable 115,375 --
Accrued expenses 75,092 120,685
------------- ------------
Total liabilities 15,480,834 15,317,147
------------- ------------
Contingencies
Partners' capital
BUC$holders (7,906,234 BUC$ issued and outstanding) 125,212,937 125,346,852
General partners (362,419) (359,686)
------------- ------------
Total partners' capital 124,850,518 124,987,166
------------- ------------
Total liabilities and partners' capital $ 140,331,352 $140,304,313
------------- ------------
------------- ------------
---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
2
<PAGE>
<PAGE>
SUMMIT TAX EXEMPT BOND FUND, L.P.
(a limited partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended Three months ended
June 30, June 30,
------------------------- -------------------------
1995 1994 1995 1994
<S> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------
REVENUES
Interest income from participating first
mortgage bonds, net $4,680,292 $4,812,793 $2,320,794 $2,399,131
Interest income from promissory notes 307,204 314,414 156,729 154,529
Interest income from temporary investments 43,009 17,013 22,197 9,632
---------- ---------- ---------- ----------
5,030,505 5,144,220 2,499,720 2,563,292
---------- ---------- ---------- ----------
EXPENSES
Interest expense 696,280 530,099 350,542 277,779
Management fees 335,938 335,938 167,969 167,969
Legal expense 256,671 30,000 172,671 15,000
General and administrative 184,778 157,873 93,273 78,949
Loan servicing fees 166,157 166,588 83,537 83,754
Amortization of deferred bond selection
fees 75,029 75,029 37,515 37,515
Amortization of deferred financing fees 63,914 63,914 31,958 31,958
---------- ---------- ---------- ----------
1,778,767 1,359,441 937,465 692,924
---------- ---------- ---------- ----------
Net income $3,251,738 $3,784,779 $1,562,255 $1,870,368
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
ALLOCATION OF NET INCOME
BUC$holders $3,186,703 $3,709,083 $1,531,010 $1,832,961
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
General partners $ 65,035 $ 75,696 $ 31,245 $ 37,407
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income per BUC $ .40 $ .47 $ .19 $ .23
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
-----------------------------------------------------------------------------------------------------
</TABLE>
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
<TABLE>
<CAPTION>
GENERAL
BUC$HOLDERS PARTNERS TOTAL
<S> <C> <C> <C>
---------------------------------------------------------------------------------------------------
Partners' capital (deficit)--December 31, 1994 $125,346,852 $(359,686) $124,987,166
Net income 3,186,703 65,035 3,251,738
Distributions (3,320,618) (67,768) (3,388,386)
------------ --------- ------------
Partners' capital (deficit)--June 30, 1995 $125,212,937 $(362,419) $124,850,518
------------ --------- ------------
------------ --------- ------------
---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
3
<PAGE>
<PAGE>
SUMMIT TAX EXEMPT BOND FUND, L.P.
(a limited partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended
June 30,
---------------------------
1995 1994
<S> <C> <C>
----------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Interest received, net $5,635,194 $4,914,758
Loan made to property affiliate (721,266 ) --
Fees and expenses paid (749,978 ) (565,352 )
Interest paid (580,905 ) (614,920 )
----------- -----------
Net cash provided by operating activities 3,583,045 $3,734,486
CASH FLOWS FROM INVESTING ACTIVITIES
Net sale (purchase) of temporary investments 30,181 (400,245 )
CASH FLOWS FROM FINANCING ACTIVITIES
Distributions paid (3,388,386 ) (3,388,386 )
----------- -----------
Net increase (decrease) in cash 224,840 (54,145 )
Cash at beginning of period 173,689 200,227
----------- -----------
Cash at end of period $398,529 $146,082
----------- -----------
----------- -----------
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
SCHEDULE RECONCILING NET INCOME TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
Net income $3,251,738 $3,784,779
----------- -----------
Adjustments to reconcile net income to net cash provided by
operating activities:
Amortization of valuation allowance (65,006 ) (65,006 )
Amortization of deferred income (65,941 ) (64,300 )
Amortization of deferred bond selection fees 75,029 75,029
Amortization of financing fees 63,914 63,914
Changes in:
Promissory notes receivable, net 103,019 75,840
Interest receivable 14,370 (91,401 )
Other assets (23,706 ) (30,582 )
Deferred income (103,019 ) (75,840 )
Accrued expenses (45,593 ) (134,637 )
Accrued interest payable 115,375 (84,821 )
Due to affiliates 262,865 281,511
----------- -----------
Total adjustments 331,307 (50,293 )
----------- -----------
Net cash provided by operating activities $3,583,045 $3,734,486
----------- -----------
----------- -----------
----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements
</TABLE>
4
<PAGE>
<PAGE>
SUMMIT TAX EXEMPT BOND FUND, L.P.
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
A. General
These financial statements have been prepared without audit. In the opinion
of management, the financial statements contain all adjustments (consisting of
only normal recurring adjustments) necessary to present fairly the financial
position of Summit Tax Exempt Bond Fund, L.P. (the ``Partnership'') as of June
30, 1995, the results of its operations for the six and three months ended June
30, 1995 and 1994 and its cash flows for the six months ended June 30, 1995 and
1994. However, the operating results for the interim periods may not be
indicative of the results expected for the full year.
Certain information and footnote disclosures normally included in annual
financial statements prepared in accordance with generally accepted accounting
principles have been omitted. It is suggested that these financial statements be
read in conjunction with the financial statements and notes thereto included in
the Partnership's Annual Report on Form 10-K filed with the Securities and
Exchange Commission (the ``Annual Report'') for the year ended December 31,
1994.
B. Participating First Mortgage Bonds
Effective January 1, 1995, the Partnership adopted Statement of Financial
Accounting Standards (``SFAS'') No. 114, Accounting by Creditors for Impairment
of a Loan. The initial adoption of SFAS No. 114 had no effect on the net income
of the Partnership for the six months ended June 30, 1995.
SFAS No. 114 requires creditors to evaluate the collectibility of both
interest and principal of a participating first mortgage bond (``FMB'') when
determining whether it is impaired. An FMB is considered to be impaired when,
based on current information and events, it is probable the creditor will be
unable to collect all amounts due according to the contractual terms. When an
FMB is considered to be impaired, the amount of the loss accrual is determined
by discounting the expected future cash flows of the FMB at its effective
interest rate or, for practical purposes, from the estimated fair value of the
collateral. To the extent that the owners of properties underlying the FMBs may
require modifications to their forbearance agreements or the FMBs may otherwise
become impaired in subsequent periods, the Partnership may be required to record
additional valuation allowances which could have a material effect on the
Partnership's financial statements.
Prior to January 1, 1995, the original owners of the underlying properties
and obligors of certain FMBs had been replaced by affiliates of Related Tax
Exempt Bond Associates, Inc. (the ``Related General Partner'') who had not made
equity investments in the underlying properties. These FMBs and related income,
which were classified as Assets Held for Sale in prior years, have been
reclassified to FMBs in 1995 for all periods presented.
5
<PAGE>
<PAGE>
Descriptions of the FMBs owned by the Partnership at June 30, 1995 are as
follows:
<TABLE>
<CAPTION>
Annualized
Interest
Rate Paid
for the six
months
ended Minimum Stated
June 30, Pay Rate Interest Call Maturity Face Carrying
Property Location 1995* June 1995 Rate* Date Date Amount Amount
<S> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------
The Mansion Independence,
Mo 5.70%(B) 5.23% 5.23 % Dec. 2004 May 2010 $19,450,000 $17,800,000
Martin's Creek Summerville, SC 7.97 7.25 8.25 Mar. 2000 May 2010 7,300,000 7,010,972
East Ridge Mt. Pleasant,
SC 7.81 7.25 8.25 Mar. 2000 May 2010 8,700,000 8,371,566
High Pointe
Club Harrisburg, Pa 6.07 (A) 8.50 June 1998 June 2006 8,900,000 8,900,000
Cypress Run Tampa, Fl 7.28 (A) 8.50 Aug. 1998 Aug. 2006 15,402,428 15,402,428
Thomas Lake Eagan, Mn 8.40(C) 8.00 8.50 Aug. 1998 Aug. 2006 12,975,000 12,975,000
North Glen Atlanta, Ga 6.00 6.00 8.50 Aug. 1998 Aug. 2008 12,400,000 12,400,000
Greenway Manor St. Louis, Mo 8.50 (A) 8.50 Oct. 1998 Sept. 2006 12,850,000 12,850,000
Clarendon Hills Hayward, Ca 5.52 5.52 5.52 Dec. 2003 Dec. 2003 17,600,000 17,600,000
Cedar Creek McKinney, Tx 6.60 (A) 8.50 Dec. 1998 Dec. 2006 8,100,000 7,798,550
Sunset Terrace Lancaster, Ca 6.07(D) 7.75 8.00 Feb. 1999 Feb. 2007 10,350,000 10,350,000
------------ ------------
$134,027,428 131,458,516
------------
------------
Less: Allowance for loss on impairment of assets (3,455,000 )
------------
Carrying Amount $128,003,516
------------
------------
* The rate paid represents the interest recorded by the Partnership while the stated rate represents the coupon rate of the FMB.
(A) Pay rate is based on the net cash flow generated by the property.
(B) Includes contingent interest paid during the six months ended June 30, 1995.
(C) Includes receipt of deferred base interest related to prior periods.
(D) See discussion below.
</TABLE>
On March 31, 1995, pursuant to a Court Order, ownership of the Cypress Run
property was transferred to an affiliate of the Related General Partner. The
affiliate has not made an equity investment in the underlying property; however,
it will assume the day-to-day responsibilities and obligations of operating the
property.
Effective with the May 1, 1995 payment date, the Sunset Terrace FMB has made
payments based on the monthly net cash flow generated by the operations of the
underlying property pending finalization of the agreement outlined below.
Pursuant to an executed Letter of Intent, the obligor of the Sunset Terrace FMB
has agreed to enter into a forbearance agreement to be effective as of August 1,
1995. In accordance with the terms of this agreement, the obligor of the FMB
will pay debt service on the FMB to the extent of cash flow generated by the
underlying property. The difference between the pay rate and the stated rate of
this FMB is deferred and payable out of available future cash flow. Pursuant to
the terms of the agreement, the obligor will replace the present property
manager and leasing agent with a new property manager who is an affiliate of the
Related General Partner. Other terms of the agreement call for the deed to be
transferred to the Partnership or its designee no later than January 30, 1997
should the obligor be unable to bring the FMB fully current on all interest due
and payable (including deferred base interest) on or before that date. These
obligations will be secured by a guarantee from an affiliate of the obligor
which is intended to protect certain of the Partnership's rights. Final
documentation of this agreement has not yet been completed. There is no
certainty that this agreement will be finalized. No additional allowance for
loss on impairment was required as a result of this transaction.
In November 1989, a $600,000 settlement was reached between the previous
developer of High Pointe Club Apartments (the ``Property'') and USF&G, the
construction performance bonding company for the Property. Prior to this
settlement, the previous developer agreed to place the settlement proceeds in
escrow later to be shared with the subsequent developer (``Greenhill Project
Investors, Inc.'') or its successors and assigns pursuant to an arbitration
proceeding. On April 23, 1993, the previous developer agreed to release the
escrowed funds to RHA Inv., Inc. (``RHA''), the successor to Greenhill Project
Investors, Inc. In April 1995, RHA paid to the Partnership approximately
$721,000 consisting of the settlement proceeds plus accrued interest. These
funds were applied as partial payment toward accrued and unpaid interest due
under the High Pointe Club FMB.
During April 1995, the Partnership made a loan in the amount of approximately
$721,000 to the new owner of the Cypress Run property toward payment of
delinquent 1992 and 1993 property taxes. This loan will be self-amortizing over
three years and carry an 8.5% annual interest rate. This loan was recorded in
operating income as a reduction of interest income from participating first
mortgage bonds because the Cypress Run FMB is paying interest on a cash flow
basis.
The Thomas Lake promissory note in the principal amount of $220,000, which is
secured by a second mortgage on the property, matured in April 1995 and was
modified and extended. The modified loan is self-amortizing over thirty months
at an 8.5% interest rate.
6
<PAGE>
<PAGE>
With respect to the FMBs which are subject to forbearance agreements with the
respective obligors, the difference between the stated interest rates and the
rates paid (while deferred and payable out of available future cash flow or,
ultimately, from sale or refinancing proceeds) on FMBs is not accrued for
financial statement purposes. The accrual of interest at the stated interest
rate will resume once a property's ability to pay the stated rate has been
adequately demonstrated. Unrecorded contractual interest income was
approximately $570,000 and $379,000 for the six months ended June 30, 1995 and
1994, respectively.
C. Related Parties
The General Partners and their affiliates perform services for the
Partnership which include, but are not limited to: accounting and financial
management; registrar, transfer and assignment functions; asset management;
investor communications; printing and other administrative services. The General
Partners and their affiliates receive reimbursements for costs incurred in
connection with these services, the amount of which is limited by the provisions
of the Agreement of Limited Partnership (the ``Partnership Agreement''). The
costs and expenses were:
<TABLE>
<CAPTION>
Six months ended Three months ended
June 30, June 30,
--------------------- ---------------------
1995 1994 1995 1994
<S> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------
Prudential-Bache Properties, Inc. (``PBP'') and
affiliates:
General and administrative $56,793 $44,969 $29,991 $20,953
Management fee 167,969 167,969 83,985 83,985
-------- -------- -------- --------
224,762 212,938 113,976 104,938
-------- -------- -------- --------
Related General Partner and affiliates:
General and administrative 24,092 13,403 11,273 7,354
Loan servicing fees 166,157 166,588 83,537 83,754
Management fee 167,969 167,969 83,985 83,984
-------- -------- -------- --------
358,218 347,960 178,795 175,092
-------- -------- -------- --------
$582,980 $560,898 $292,771 $280,030
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
An affiliate of the Related General Partner receives loan servicing fees (see
above) in the amount of .25% per annum of the principal amount outstanding on
FMBs serviced by the affiliate.
The General Partners are paid, in the aggregate, an annual management fee
equal to .5% of the original amount invested in FMBs.
A division of Prudential Securities Incorporated (``PSI''), an affiliate of
PBP, is responsible for the purchase, sale, and safekeeping of the Partnership's
temporary investments. This account is maintained in accordance with the
Partnership Agreement.
Several executive officers and directors of the Related General Partner own
less than 1% of the outstanding BUC$.
D. Contingencies
On October 18, 1993, a putative class action, captioned Kinnes et al. v.
Prudential Securities Group Inc. et al. (93 Civ. 654) was filed in the United
States District Court for the District of Arizona, purportedly on behalf of
investors in the Partnership against the Partnership, PBP, PSI and a number of
other defendants. On November 16, 1993, a putative class action captioned
Connelly et al. v. Prudential-Bache Securities Inc. et al. (93 Civ. 713), was
filed in the United States District Court for the District of Arizona,
purportedly on behalf of investors in the Partnership against the Partnership,
PBP, PSI and a number of other defendants. On January 3, 1992, a putative class
action, captioned Levine v. Prudential-Bache Properties Inc. et al. (92 Civ.
52), was filed in the United States District Court for the Northern District of
Illinois purportedly on behalf of investors in the Partnership against the
General Partners, PSI and a number of other defendants. Subsequently the Related
General Partner exited the litigation by way of settlement. On April 14, 1994,
the Judicial Panel on Multidistrict Litigation (the ``Panel'') deferred transfer
of the case to the Southern District of New York (discussed more fully below)
until after the Illinois court decided a pending motion to dismiss the
complaint. On June 3, 1994, that court granted the motion of PBP and PSI and
dismissed the first amended complaint without prejudice. On June 30, 1994,
plaintiffs filed a second amended complaint. The Panel subsequently reaffirmed
the April 14, 1994 transfer. By order dated July 13, 1994, the Panel
unconditionally
7
<PAGE>
<PAGE>
transferred the Levine case for inclusion in the consolidated proceedings in the
Southern District of New York described below.
By its April 14, 1994 order, the Panel transferred (in addition to Levine as
discussed above) the Kinnes case, and by order dated June 8, 1994, the Connelly
case, together with a number of other actions, on each occasion not involving
the Partnership, to a single judge of the United States District Court for the
Southern District of New York and consolidated them for pretrial proceedings
under the caption In re Prudential Securities Incorporated Limited Partnerships
Litigation (MDL Docket 1005). On June 8, 1994, plaintiffs in the transferred
cases filed a complaint that consolidated the previously filed complaints and
named as defendants, among others, PSI, certain of its present and former
employees and the General Partners. The Partnership is not named a defendant in
the consolidated complaint, but the name of the Partnership is listed as being
among the limited partnerships at issue in the case. The consolidated complaint
alleges violations of the federal and New Jersey Racketeer Influenced and
Corrupt Organizations Act (``RICO'') statutes, fraud, negligent
misrepresentation, breach of fiduciary duties, breach of third-party beneficiary
contracts and breach of implied covenants in connection with the marketing and
sales of limited partnership interests. Plaintiffs request relief in the nature
of rescission of the purchase of securities and recovery of all consideration
and expenses in connection therewith, as well as compensation for lost use of
money invested less cash distributions; compensatory damages; consequential
damages; treble damages for defendants' RICO violations (both federal and New
Jersey); general damages for all injuries resulting from negligence, fraud,
breaches of contract, and breaches of duty in an amount to be determined at
trial; disgorgement and restitution of all earnings, profits, benefits and
compensation received by defendants as a result of their unlawful acts; costs
and disbursements of the action; reasonable attorneys' fees; and such other and
further relief as the court deems just and proper.
On November 28, 1994, the transferee court deemed each of the complaints in
the constituent actions (including Kinnes) amended to conform to the allegations
of the consolidated complaint. PSI and PBP, along with various other defendants,
filed a motion to dismiss the consolidated complaint on December 20, 1994. That
motion is pending.
The General Partners and PSI believe they have meritorious defenses to the
complaints and intend to vigorously defend against these actions.
On March 6, 1991, a derivative action entitled Virginia First Savings Bank,
F.S.B., et al. v. Tax Exempt Bond Associates, Inc. et al., No. (L91-726) was
filed in Virginia Circuit Court against the General Partners and others.
Plaintiffs were one named and other unknown individual investors who were
purportedly suing on behalf of the Partnership. Defendants included, among
others, the Partnership and its General Partners. The complaint alleged breach
of fiduciary duty. Plaintiffs sought an indeterminate amount of damages. By
order entered April 5, 1995, the court dismissed this action for want of
prosecution.
E. Subsequent Event
In August 1995, a distribution of approximately $1,660,000 and $34,000 was
paid to the BUC$holders and General Partners, respectively, for the quarter
ended June 30, 1995.
8
<PAGE>
<PAGE>
SUMMIT TAX EXEMPT BOND FUND, L.P.
(a limited partnership)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
Summit Tax Exempt Bond Fund, L.P. (``the Partnership'') has invested in
eleven tax-exempt participating first mortgage bonds (``FMBs'') issued by
various state or local governments or their agencies or authorities. The FMBs
are secured by participating first mortgage loans on multi-family residential
apartment projects.
The second quarter distribution of $1,660,000 ($.21 per BUC) was paid to
BUC$holders in August 1995 from current and previously undistributed adjusted
cash flow from operations. As further discussed in Note B to the financial
statements, the Sunset Terrace FMB may be restructured effective as of August 1,
1995. This restructuring may negatively impact the amount of interest paid from
this FMB in future quarters. Interest payments from FMBs are anticipated to
provide sufficient liquidity to meet the operating expenditures of the
Partnership in future years and to fund distributions.
The Partnership's loan payable has a variable interest rate; therefore,
future levels of interest expense will fluctuate in correlation to movements in
the 30-day commercial paper interest rate.
In July 1994, the owner of the Cypress Run property filed for bankruptcy
under Chapter 11 of the United States Bankruptcy Code in response to the
Partnership's acceleration of its loan. On March 31, 1995, the ownership of the
Cypress Run property was transferred to an affiliate of the Related General
Partner pursuant to a Court Order.
In April 1995, the Partnership received a payment of $721,000 from High
Pointe Club which was applied as accrued and unpaid interest due under the High
Pointe Club FMB. The Partnership made a $721,000 loan to the new owner of the
property underlying the Cypress Run FMB toward payment of delinquent 1992 and
1993 property taxes. See Note B to the financial statements for further
information regarding this loan. The new owner of Cypress Run is currently
escrowing cash toward the payment of 1994 and 1995 real estate taxes which may
impact the amount of interest paid on the Cypress Run FMB to the Partnership.
Results of Operations
Net income decreased by $533,000 and $308,000 for the six and three months
ended June 30, 1995, respectively, as compared to 1994 for the reasons discussed
below.
Interest income from FMBs decreased by $133,000 and $78,000 for the six and
three months ended June 30, 1995, respectively, as compared to 1994. These
decreases were primarily the result of reduced debt service payments received
from the Cypress Run and Sunset Terrace FMBs (see Note B to the financial
statements) and were partially offset by increased interest, including
contingent interest, received from The Mansion FMB and deferred interest from
the Thomas Lake FMB.
Interest income from temporary investments increased by $26,000 and $13,000
for the six and three months ended June 30, 1995, respectively, as compared to
1994 primarily due to higher interest rates and invested balances.
Interest expense increased by $166,000 and $73,000 for the six and three
months ended June 30, 1995, respectively, as compared to 1994 due to interest
rate increases on the Partnership's loan.
General and administrative expenses increased by $27,000 and $14,000 for the
six and three months ended June 30, 1995 as compared to 1994. The variance is
primarily due to the timing of certain accruals recorded in the respective
periods.
Legal expense increased $227,000 and $158,000 for the six and three months
ended June 30, 1995, respectively, as compared to 1994. These increases were
primarily due to legal costs incurred with respect to the Kinnes litigation
discussed in Note D to the financial statements and the Cypress Run bankruptcy
proceedings.
9
<PAGE>
<PAGE>
Property Information
The following table lists the FMBs that the Partnership owns, together with
occupancy rates of the underlying properties, as of July 16, 1995:
<TABLE>
<CAPTION>
Annualized
Interest
Rate Paid
for the six Minimum
months ended Pay Rate
Stated June 30, June
Property Location Face Amount Occupancy Interest Rate* 1995* 1995
<S> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------
The Mansion Independence, Mo $19,450,000 96.9% 5.23% 5.70%(B) 5.23 %
Martin's Creek Summerville, SC 7,300,000 93.9 8.25 7.97 7.25
East Ridge Mt. Pleasant, SC 8,700,000 97.0 8.25 7.81 7.25
High Pointe Club Harrisburg, Pa 8,900,000 98.7 8.50 6.07 (A)
Cypress Run Tampa, Fl 15,402,428 84.1 8.50 7.28 (A)
Thomas Lake Eagan, Mn 12,975,000 100.0 8.50 8.40(C) 8.00
North Glen Atlanta, Ga 12,400,000 99.3 8.50 6.00 6.00
Greenway Manor St. Louis, Mo 12,850,000 98.7 8.50 8.50 (A)
Clarendon Hills Hayward, Ca 17,600,000 97.5 5.52 5.52 5.52
Cedar Creek McKinney, Tx 8,100,000 96.0 8.50 6.60 (A)
Sunset Terrace Lancaster, Ca 10,350,000 85.7 8.00 6.07(D) 7.75
------------
$134,027,428
------------
------------
-----------------------------------------------------------------------------------------------------------------------
* The rate paid represents the interest recorded by the Partnership while the stated rate represents the coupon rate of
the FMB.
(A) Pay rate is based on the net cash flow generated by the property.
(B) Includes contingent interest paid during the six months ended June 30, 1995.
(C) Includes receipt of deferred base interest relating to prior periods.
(D) See Note B to the financial statements.
</TABLE>
General
The determination as to whether it is in the best interest of the Partnership
to enter into forbearance agreements on the FMBs or, alternatively, to pursue
its remedies under the loan documents, including foreclosure, is based upon
several factors. These factors include, but are not limited to, property
performance, owner cooperation and projected legal costs.
From time to time, certain property owners have elected to supplement the
cash flow generated by the properties to meet the required FMB interest
payments. There can be no assurance that in the future any property owner will
continue to elect to supplement property cash flow to satisfy FMB interest
requirements, if necessary. The owner of the Sunset Terrace property
supplemented the cash flow generated by the property to meet the interest
payments made during the first five months of 1995.
10
<PAGE>
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings--Incorporated by reference to Note D to the financial
statements filed herewith in Item 1 of Part I of the Registrant's
Quarterly Report.
Item 2. Changes in Securities--None
Item 3. Defaults Upon Senior Securities--None
Item 4. Submission of Matters to a Vote of Security Holders--None
Item 5. Other Information--None
Item 6. Exhibits and Reports on Form 8-K--
(a) Exhibits:
4(a)--Partnership Agreement, incorporated by reference to Exhibit A to
the Prospectus of Registrant, dated February 19, 1986, filed pursuant
to Rule 424(b) under the Securities Act of 1933, File No. 33-2421.
4(b)--Amended and Restated Certificate of Limited Partnership,
incorporated by reference to Exhibit 4 to Registration Statement on
Form S-11, File No. 33-2421.
27--Financial Data Schedule (filed herewith).
(b) Reports on Form 8-K--No reports on Form 8-K were filed during the
quarter.
11
<PAGE>
<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.
Summit Tax Exempt Bond Fund, L.P.
By: Prudential-Bache Properties, Inc.
A Delaware corporation, General Partner
By: /s/ Robert J. Alexander Date: August 14, 1995
---------------------------------------------
Robert J. Alexander
Vice President
Chief Accounting Officer for the Registrant
By: Related Tax Exempt Bond Associates, Inc.
A Delaware corporation, General Partner
By: /s/ Alan P. Hirmes Date: August 14, 1995
---------------------------------------------
Alan P. Hirmes
Vice President
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial
information extracted from the financial
statements for Summit Tax Exempt Bond Fund LP
and is qualified in its entirety by reference
to such financial statements
</LEGEND>
<RESTATED>
<CIK> 0000786156
<NAME> Summit Tax Exempt Bond Fund LP
<MULTIPLIER> 1
<FISCAL-YEAR-END> Dec-31-1995
<PERIOD-START> Jan-1-1995
<PERIOD-END> Jun-30-1995
<PERIOD-TYPE> 6-Mos
<CASH> 398,529
<SECURITIES> 129,889,209
<RECEIVABLES> 10,043,614
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 140,331,352
<CURRENT-LIABILITIES> 1,799,968
<BONDS> 13,680,866
0
0
<COMMON> 0
<OTHER-SE> 124,850,518
<TOTAL-LIABILITY-AND-EQUITY> 140,331,352
<SALES> 0
<TOTAL-REVENUES> 5,030,505
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,082,487
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 696,280
<INCOME-PRETAX> 3,251,738
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,251,738
<EPS-PRIMARY> .40
<EPS-DILUTED> 0
</TABLE>
