<PAGE> 1
Page 1 of 10
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------
FORM 10-Q
----------------------------
<TABLE>
<S> <C>
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934
For the transition period from to .
---------- ----------
</TABLE>
Commission file number 0-15571
CAROLINA INVESTMENT PARTNERS, LIMITED PARTNERSHIP
(Exact name or registrant as specified in its charter)
<TABLE>
<S> <C>
North Carolina 56-1494619
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
</TABLE>
Suite 210, 4112 Blue Ridge Road
Raleigh, North Carolina 27612
(Address of principal executive office)
(Zip Code)
(919) 781-1700
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report)
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
------- -------
The Exhibit Index is located on Page 10.
1
<PAGE> 2
Page 2 of 10
PART I - FINANCIAL INFORMATION
Item 1. Financial Information
a) Income Statement
STATEMENTS OF INCOME (Unaudited)
<TABLE>
<CAPTION>
Quarter Ended
March 31
1995 1994
--------- ---------
<S> <C> <C>
Interest income $ 198 $ 309
Other income 35,664 1,748
--------- ---------
Total income 35,862 2,057
General and administrative expenses 11,096 10,325
--------- ---------
NET INCOME (LOSS) $ 24,766 $ (8,268)
========= =========
Allocation of net income (loss) to:
General Partner $ 248 $ -0-
Limited Partner 24,518 ( 8,268)
--------- ---------
$ 24,766 ( 8,268)
========= =========
Net income (loss) per limited
partnership unit
(based on 5,900 weighted
average limited partnership units
outstanding) $ 4.16 $ (1.40)
========= ==========
</TABLE>
See notes to unaudited financial statements.
2
<PAGE> 3
Page 3 of 10
b) Balance Sheets
BALANCE SHEETS
<TABLE>
<CAPTION>
March 31 December 31
1995 1994
(Unaudited)
<S> <C> <C>
ASSETS
Cash $ 284 $ 812
Short-term investment 52,451 3,253
---------- ----------
CASH AND CASH EQUIVALENTS 52,735 4,065
Land held for investment--Note B 4,822,183 4,822,183
Other assets 2,353 103
---------- ----------
TOTAL ASSETS $4,877,271 $4,826,351
========== ==========
LIABILITIES AND PARTNERS' EQUITY
Trade accounts payable and other
accrued liabilities $ 12,304 $ 5,486
Note payable to General
Partner -- Note C 19,336 -0-
--------- ----------
TOTAL LIABILITIES 31,640 5,486
PARTNERS' EQUITY
General partner's equity 248 -0-
Limited partners' equity; 5900
units authorized, issued,
and outstanding 4,845,383 4,820,865
--------- ----------
TOTAL LIABILITIES
AND PARTNERS' EQUITY $4,877,271 $4,826,351
========== ==========
</TABLE>
See notes to unaudited financial statements.
3
<PAGE> 4
Page 4 of 10
c) Statements of Changes in Partners' Capital
STATEMENTS OF CHANGES IN PARTNERS' EQUITY (Unaudited)
<TABLE>
<CAPTION>
Limited General Limited
Partnership Partner's Partners'
Units Equity Equity Total
------- --------- ---------- ----------
<S> <C> <C> <C> <C>
Balance at
January 1, 1995 5,900 $ -0- $4,820,865 $4,820,865
Net income for the
quarter ended
March 31, 1995 248 24,518 24,766
------- --------- ---------- ----------
BALANCE AT
MARCH 31, 1995 5,900 $ 248 $4,845,383 $4,845,631
======= ========= ========== ==========
Balance at
January 1, 1994 5,900 $ -0- $4,853,618 $4,853,618
Net loss for the
quarter ended
March 31, 1994 (8,268) (8,268)
------- --------- ----------- -----------
BALANCE AT
MARCH 31, 1994 5,900 $ -0- $4,845,350 $4,845,350
======= ========= ========== ==========
</TABLE>
See notes to unaudited financial statements.
4
<PAGE> 5
Page 5 of 10
d) Statements of Changes in Financial Position
STATEMENTS OF CASH FLOW (Unaudited)
<TABLE>
<CAPTION>
Quarter Ended
March 31
----------------------------------
1995 1994
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ 24,766 $ (8,268)
Increase in other assets (2,250) (2,250)
Increase (decrease) in trade accounts
payable 6,818 (5,216)
--------- ---------
NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES 29,334 (15,734)
FINANCING ACTIVITIES
Loan from General Partner 55,000 -0-
Repayment of loan from General
Partner (35,664) -0-
--------- ---------
NET CASH PROVIDED (USED) BY
FINANCING ACTIVITIES 19,336 -0-
--------- ---------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 48,670 (15,734)
Cash and cash equivalents at
beginning of period 4,065 56,607
--------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 52,735 $ 40,873
========= =========
SUPPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the quarter for interest was $0
in 1995 and 1994.
</TABLE>
See notes to unaudited financial statements.
5
<PAGE> 6
Page 6 of 10
e) Notes to Financial Statements
NOTES TO UNAUDITED FINANCIAL STATEMENTS
March 31, 1995
NOTE A - SIGNIFICANT ACCOUNTING POLICIES AND PARTNERSHIP MATTERS
Carolina Investment Partners, Limited Partnership (the "Registrant"), was
organized in 1985 to invest in real property which it will sell or lease
undeveloped or develop into office or commercial projects. Walsmith Associates
Two, a North Carolina general partnership, is the general partner (the "General
Partner").
Basis of Presentation:
The accompanying March 31, 1995 financial statements of the Registrant are
unaudited. In the opinion of the General Partner, all adjustments (consisting
of normal accruals) considered necessary for a fair presentation have been
included. Operating results for the period presented are not necessarily
indicative of the results that may be expected for the entire year.
NOTE B - LAND HELD FOR INVESTMENT AND RELATED COMMITMENTS
In July, 1986, the Registrant purchased for $1,223,175 an undeveloped 16.3 acre
parcel of land in Cary, North Carolina, known as the Wellington Parcel, from
Wellington Park Associates ("WPA"), an affiliate of the General Partner. The
land is carried at the lower of (i) contract cost plus capitalized purchase and
closing costs or (ii) net realizable value. The Registrant may, at its option,
require WPA to repurchase the Wellington Parcel for approximately $3,669,000
(the "Put Option"). The contract provides that WPA will share with the
Registrant in any profits resulting from the sale of the Wellington Parcel.
More than 87.5% of the profits will be retained by the Registrant if the
Wellington Parcel is sold to a third party other than by exercise of the Put
Option by the Registrant. If the Put Option is exercised, the Registrant will
retain only 50% of the profit from sale of the Wellington Parcel.
In June, 1986 the Registrant purchased for approximately $3,080,200 an
undeveloped 26.7 acre parcel of land in Cary, North Carolina, known as the
Martin Parcel, from an affiliate of the General Partner. The land is carried
at the lower of (i) contract cost plus capitalized purchase and closing costs
or (ii) net realizable value.
6
<PAGE> 7
Page 7 of 10
NOTE C - NOTE PAYABLE TO GENERAL PARTNER
On February 2, 1995 the Registrant borrowed $55,000 from its General Partner.
The note is payable upon the sale of any of the Registrant's properties or
other sources of funds that become available, but in no case later than June 1,
1996. The note bears interest at the rate of prime plus 1%, which is payable
quarterly.
7
<PAGE> 8
Page 8 of 10
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
The Registrant's operations resulted in a net income of $24,766 during
the quarter ended March 31, 1995, compared to a net loss of $8,268 during the
same period of 1994. The primary differences between 1995 and 1994 were:
1. In 1995 the Registrant had timber removed from one of its properties
resulting in income of $35,664. Income from the sale of timber was
$1,648 in 1994 when the trees were thinned on the Martin East parcel.
2. Expenses in 1995 include interest expense of $756 on a new note (see
below) and the cost of appraisals for the Registrant's properties.
The Registrant has sufficient funds for its present needs. The
Registrant maintains its excess funds in a money market account at Triangle
East Bank. The General Partner believes this account is an appropriate
investment of the Registrant's funds. Until either of the properties is sold,
placed into development and/or refinanced, the Registrant anticipates deficits
from operations and administrative expenses.
On February 2, 1995 the Registrant borrowed $55,000 from the General
Partner to replenish its cash balance which had been depleted by operating
expenses. The note is payable upon the sale of the Registrant's properties or
other sources of funds but must be paid no later than June 1, 1996. The note
bears interest at prime plus one percent. Interest is payable quarterly.
In February and March 1995, the Registrant had timber removed from its
properties. The General Partner anticipates that the timber sale will generate
more than $50,000, which will be used to repay all or a portion of the loan
from the General Partner and/or fund future operating expenses. As of May 5,
1995, $35,664 had been collected from the timber sale and repaid against the
loan.
The Registrant has entered an Agreement for the Purchase and Sale of
Real Estate (the "Agreement") regarding the Registrant's Wellington Parcel. If
this Agreement closes the Registrant's liquidity and financial condition will
substantially improve.
PART II
Item 6. Exhibits and Reports on Form 8-K
(a) 27 Financial Data Schedule (for SEC use only)
(b) Report on Form 8-K dated April 20, 1995 reporting Item 2,
Acquisition or Disposition of Assets.
8
<PAGE> 9
Page 9 of 10
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused the report to be signed on its behalf by the
undersigned thereunto duly authorized.
CAROLINA INVESTMENT PARTNERS
LIMITED PARTNERSHIP (Registrant)
BY: WALSMITH ASSOCIATES TWO,
General Partner
/s/ Alton L. Smith, III
-----------------------------------
Alton L. Smith, III, General Partner
Date: May 8, 1995.
9
<PAGE> 10
Page 10 of 10
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
S-K Reference
and Exhibit Sequential
Number Description Page Number
- -------------- ----------- -----------
<S> <C> <C>
28.1 Offer to Purchase and Contract for The Quarterly
the Sale and Purchase of Real Report on Form
Estate dated as of January 24, 1986, 10-Q for the
between Wellington Park Associates Quarter ended
and the Registrant June 30, 1989.
Page 12.
28.2 Amendment to Offer to Purchase and Annual Report
Contract for Sale of Real Estate on Form 10-K
dated as of February 1, 1990 for the Year
between the Registrant and ended December
Wellington Park Associates 31, 1989. Page
28.
28.3 Agreement for the Purchase and Current Report
Sale of Real Estate Form 8-K dated
April 20, 1995,
Page 4.
27 Financial Data Schedule (for SEC use only)
</TABLE>
10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF CAROLINA INVESTMENT PARTNERS FOR THE THREE MONTHS ENDED
MARCH 31, 1995, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<EXCHANGE-RATE> 1
<CASH> 52,735
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,353
<PP&E> 4,822,183
<DEPRECIATION> 0
<TOTAL-ASSETS> 4,877,271
<CURRENT-LIABILITIES> 31,640
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 4,845,631
<TOTAL-LIABILITY-AND-EQUITY> 4,877,271
<SALES> 0
<TOTAL-REVENUES> 35,862
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 11,096
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 24,766
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,766
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
