<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
[Fee Required]
For the fiscal year ended
December 31, 1998
or
[ ] Transition Report to Section 13 or 15(d) of the Securities
Exchange Act of 1934
[Fee Required]
For the transition period from ________to_______
Commission File Number
33-3955-A
MOORE'S LANE PROPERTIES, LTD.
(Exact name of Registrant as specified in its charter)
Tennessee 62-1271931
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification
Number.)
One Belle Meade Place, 4400 Harding Road, Suite 500, Nashville,
Tennessee 37205
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (615) 292-1040
Securities registered pursuant to Section 12(b) of the Act:
None
Title of each class Name of each exchange
on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class)
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 at least the past 90 days.
YES X NO
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (229.405 of this chapter) is
not contained herein, and will not be contained, to the best of the
registrant's knowledge, in definitive proxy of information
statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.
[ X ]
The aggregate sale price of the Units of Limited Partnership
Interest to non-affiliates was $7,500,000 as of February 28,1999.
This does not reflect market value, but is the price at which these
Units of Limited Partnership Interest were sold to the public.
There is no current market for these Units.
DOCUMENTS INCORPORATED BY REFERENCE
Documents Incorporated by Reference in Part IV:
Prospectus of Registrant, dated April 22, 1986, as filed pursuant
to Rule 424(b) of the Securities and Exchange Commission.
<PAGE>
PART I
Item 1. Business
General Development of Business
Moore's Lane Properties, Ltd. ("Registrant"), is a Tennessee
limited partnership organized in December 1985, pursuant to the
provisions of the Tennessee Uniform Limited Partnership Act,
Chapter 2, Title 61, Tennessee Code Annotated, as amended. The
General Partner of Registrant is 222 Partners, Inc. The
Partnership is a venturer in Moore's Lane Venture Associates (the
"Joint Venture") and has controlling interest in this Joint
Venture.
Registrant's primary business, as a consolidated entity with
the Joint Venture, is to hold for investment certain undeveloped
real property located in Franklin, Williamson County, Tennessee
(the
"Property"). Registrant's investment objectives are preservation
of investment capital and appreciation of the value of the Property
due to development of the immediately surrounding areas and the
growth of the community generally.
Financial Information About Industry Segments
The Registrant's activity, investment in land, is within one
industry segment and geographical area. Therefore, financial data
relating to the industry segment and geographical area is included
in Item 6 - Selected Financial Data.
Narrative Description of Business
As of December 31, 1998, the Joint Venture owned approximately
21 saleable acres of partially developed land in Franklin,
Tennessee. The Property is held for resale. The Property is
included in the 1,150 acre Cool Springs Corporate and Retail
Center.
The development of the Property is complete. This work
included construction of several major roads and interchanges,
grading and utility installation.
Competition:
The Cool Springs Corporate and Retail Center is in various
stages of development and is being developed for retail, office and
mixed commercial uses similar to those considered suitable for the
Property. Cool Springs Real Estate Associates, L.P. ("CSREA") owns
much of the undeveloped land in the immediate vicinity of the
Property. CSREA is an institutional real estate investor. Their
asking prices are currently comparable to the Registrant's. There
are several other competitive retail sites at the I-65 and Moore's
Lane Boulevard intersection. However, the General Partner feels
that the market can ultimately absorb all these sites and that the
Registrant's low cost in its land will allow it to compete
effectively.
The Registrant has no employees. Partnership management
services are being provided under a contractual agreement with
Landmark Realty Services Corporation, an affiliate of the General
Partners.
Item 2. Properties
As of December 31, 1998, the Joint Venture of which the
Registrant has a controlling interest owned 21 acres of land in
Franklin, Williamson County, Tennessee. The Property is included
in the Cool Springs Retail and Corporate Center. The Property is
located along Mallory Lane, west and south of the Cool Springs
Galleria Mall.
Item 3. Legal Proceedings
Registrant is not a party to, nor is any of Registrant's
property the subject of any material legal proceedings.
Item 4. Submission of Matters to a Vote of Security Holders
The security holders of Registrant did not vote on any matters
during the fiscal year covered by this report.
PART II
Item 5. Market for Registrant's Units of Limited Partnership
Interest and Related Security Holder Matters
There is no established market for the Units, and it is not
anticipated that any will exist in the future. The Registrant
commenced an offering to the public on April 22, 1986 of 7,500
Units of limited partnership interests. The offering of $7,500,000
was fully subscribed and closed on May 30, 1986. As of February
28, 1999, there were 575 holders of record of 7,500 Units of
limited partnership interests.
There are no material restrictions upon Registrant's present
or future ability to make distributions in accordance with the
provisions of Registrant's Limited Partnership Agreement.
<PAGE>
Item 6. Selected Financial Data
For the Year Ending
December 31,
1998 1997 1996 1995 1994
Total Revenue $ 1,522,795 1,580,487 54,423 1,437,479 258,112
Net Income (Loss) 907,055 1,214,577 (55,302) 1,364,037 131,947
Net Income (Loss)
per Limited
Partner Unit 68.50 109.16 (7.30) 181.03 17.59
Total Assets 1,883,301 2,629,195 2,957,702 2,964,702 3,469,752
Note Payable - - - - 175,000
Cash Distributions
per Limited Partner
Unit 170 170 - 220 -
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Sales
During 1998, there were several sales totalling approximately 9 acres for
over $2.4 million. The sales proceeds were used to make a $1.8 million cash
distribution to the partners and the remaining proceeds were reserved to
cover expenses related to the sale.
During 1997, there were six sales totalling approximately 30 acres for
over $4.2 million. The sale proceeds were used to retire the $300,000 note
payable, set aside development reserves of $686,571 and distributed
$1,487,000 to the partners. The proceeds distributed from these sales
allowed the Registrant to fully return all capital and preferred return to
the Limited Partners, after which, all cash distributions will be allocated
31% to the general partner and special limited partners and 69% to the
limited partners. The allocation ratio of limited partner to general partner
and special limited partners prior to the return of capital was 99:1.
There were no sales of land in 1996.
Operations
Other than the sales activity noted above, operations of the Registrant are
comparable during 1998, 1997, and 1996 except for the following. The
increase in interest income during 1998 is due to higher cash balances held
during the year, especially in the Restricted cash-escrow accounts. The 1997
increase in interest expense is due to the $300,000 note payable secured in
April 1997. The loan was retired in full in August 1997. During 1997, the
Registrant incurred interest of approximately $11,000 and financing fees of
approximately $9,000. The Registrant also incurred interest on short term
loans totalling $2,000.
Property tax expense includes rollback property taxes paid on the
property sold. Most of the land sold in 1998 and 1997 had been taxed at a
less expensive agricultural rate while the Registrant held it undeveloped.
During 1997, the Registrant was allowed to keep this agricultural tax rate
even though the land was included in the Cool Springs Corporate and Retail
Center because the land was subject to rollback taxes. The city and county
assessed rollback taxes on the date of sale of certain farm land. The tax is
equal to approximately 3 years taxes at a commercial rate. Certain other
parcels of the Registrant's property will be subject to this rollback tax
when sold.
General and administrative expenses were higher in 1998 due to escrow
fees and letter of credit fees. Architect and engineering fees are related
to sales activity and are higher in years with sales. Legal and accounting
fees for 1996 were higher due to additional legal services needed to handle
partnership issues.
Miscellaneous income in 1996 represents a refund of impact fees received
from the City of Franklin. This income is a result of the road development
that the Registrant has completed in the City of Franklin.
Liquidity and Capital Resources
As of January 31, 1999, the Registrant has cash of approximately $872,261.
The General Partner believes that this cash will be sufficient to meet
operating needs for 1999.
On November 10, 1997, W. Gerald Ezell, then the Registrant's general partner,
sold his partnership interest in the Registrant. In accordance with the
partnership agreement, the general partner's interest was converted into a
special limited partner interest and
his general partner responsibilities were transferred to the remaining
general partner, 222 Partners, Inc. Mr. Ezell continues to serve on the
Board of 222 Partners, Inc.
Year 2000
In 1998, the Partnership initiated a plan ("Plan") to identify, and remediate
"Year 2000" issues within each of its significant computer programs and
certain equipment which contain microprocessors. The Plan is addressing the
issue of computer programs and embedded computer chips being unable to
distinguish between the year 1900 and the year 2000, if a program or chip
uses only two digits rather than four to define the applicable year. The
Partnership has divided the Plan into five major phases-assessment, planning,
conversion, implementation and testing. After completing the assessment and
planning phases earlier in the year, the Partnership is currently in the
conversion, implementation, and testing phases. Systems which have been
determined not to be Year 2000 compliant are being either replaced or
reprogrammed, and thereafter tested for Year 2000 compliance. The Plan
anticipates that by mid-1999 the conversion, implementation and testing
phases will be completed. Management believes that the total remediation
costs for the Plan will not be material to the operations or liquidity of the
Partnership.
The Partnership is in the process of identifying and contacting critical
suppliers and other vendors whose computerized systems interface with the
Partnership's systems, regarding their plans and progress in addressing their
Year 2000 issues. The Partnership has received varying information from such
third parties on the state of compliance or expected compliance. Contingency
plans are being developed in the event that any critical supplier or customer
is not compliant.
The failure to correct a material Year 2000 problem could result in an
interruption in, or failure of, certain normal business activities or
operations. Such failures could materially and adversely affect the
Partnership's operations, liquidity and financial condition. Due to the
general uncertainty inherent in the Year 2000 problem, resulting in part from
the uncertainty of the Year 2000 readiness of third-party suppliers and
customers, the Partnership is unable to determine at this time whether the
consequences of Year 2000 failures will have a material impact on the
Partnership's operations, liquidity or financial condition.
Item 8. Financial Statements and Supplementary Data
The Financial Statements required by Item 8 are filed at the end of this
Report.
Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of the Registrant
Registrant does not have any directors or officers. 222 Partners, Inc. is
the General Partner of the Registrant and as such has general responsibility
and ultimate authority in matters affecting Registrant's business.
222 Partners, Inc.
222 Partners, Inc. was formed in September, 1986 and serves as general
partner for several other real estate investment limited partnerships.
The executive officers and directors of 222 Partners, Inc. are as
follows:
Steven D. Ezell, age 46, serves as a director, president and sole
shareholder of the corporate general partner. He has been an officer of 222
Partners, Inc. from September 17, 1986 through the current period. Mr. Ezell
is President and 50% owner of Landmark Realty Service Corporation. He was
active for the four years prior to joining Landmark in property acquisitions
for Dean Witter Realty Inc. in New York City, most recently as Senior Vice
President. He is the son of W. Gerald Ezell.
<PAGE>
Michael A. Hartley, age 39, is Secretary/Treasurer and Vice President of
the corporate general partner. He has been an officer of 222 Partners, Inc.
from September 17, 1986 through the current period. He also serves as Vice
President and 50% owner of Landmark Realty Services Corporation. For the
three years prior to joining Landmark, Mr. Hartley was a Vice President of
Dean Witter Realty Inc., a New York-based real estate investment company.
W. Gerald Ezell, age 68, is a director of corporate general partner. Mr.
Ezell is also a general partner of affiliated limited partnerships which own
various real estate properties. Until November 15, 1985, Mr. Ezell had been
for over 20 years an agency manager for Fidelity Mutual Life Insurance
Company and a registered securities principal of Capital Analysts
Incorporated, a wholly owned subsidiary of Fidelity Mutual Life Insurance
Company.
On November 10, 1997, W. Gerald Ezell, then the Registrant's
general partner, sold his partnership interest in the Registrant. In
accordance with the partnership agreement, the general partner's
interest was converted into a special limited partner interest and his
general partner responsibilities were transferred to the remaining general
partner, 222 Partners, Inc. Mr. Ezell continues to serve on the Board of 222
Partners, Inc.
Item 11. Executive Compensation
During 1998, the Registrant was not required to and did not pay
remuneration to any partners of the General Partners or any affiliates,
except as set forth in Item 13 of this report, "Certain Relationships and
Related Transactions." The General Partners do participate in the Profits,
Losses, and Distributions of the Partnership as set forth in the Partnership
Agreement.
The proceeds distributed from the 1997 sales allowed the Registrant to
fully return all capital and preferred return to the Limited Partners. As
stated in the Limited Partnership Agreement, all future cash distributions
will be allocated 69% to the limited partners and 31% to the general partner
and special limited partners. The allocation ratio of limited partner to
general partner and special limited partners prior to the return of capital
was 99:1.
Item 12. Security Ownership of Certain Beneficial Owners and Management
As of February 28, 1999, no person or "group" ( as that term is used in
Section 3 (d) (3) of the Securities Exchange Act of 1934) was known by the
Registrant to beneficially own more than five percent of the Units of
Registrant. Also as of the above date, no director of 222 Partners, Inc. was
known by the Registrant to beneficially own any of the units of the
Registrant. There are no arrangements known by the Registrant, the operation
of which may, at a subsequent date, result in a change in control of the
Registrant.
<PAGE>
Item 13. Certain Relationships and Related Transactions
No affiliated entities have, for the year ending December 31, 1998, earned
or received compensation or payments for services from the Registrant in
excess of $60,000 except for the following:
Commissions paid to minority interest holder $ 73,443
For a listing of miscellaneous transactions with affiliates refer to Note 4
of the notes to Consolidated Financial Statements herein.
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) (1) Financial Statements
The following Consolidated Financial Statements are
included herein:
Independent Auditors' Report F-1
Financial Statements
Consolidated Balance Sheets F-2
Consolidated Statements of Operations F-3
Consolidated Statements of
Partners' Equity F-4
Consolidated Statements of Cash Flows F-5
Notes to Consolidated Financial Statements F-6
(2) Financial Statement Schedule
Independent Auditors' Report S-1
Schedule III - Real Estate and Accumulated
Depreciation S-2
All other Schedules have been omitted because they are
inapplicable, not required or the information is included in the
Consolidated Financial Statements or notes thereto.
(3) Exhibits
3 Amended and Restated Certificate and Agreement of
Limited Partnership, incorporated by reference to
Exhibit A to the Prospectus of Registrant dated
April 22, 1986 filed pursuant to Rule 424(b) of
the Securities and Exchange Commission.
22 Subsidiaries
27 Financial Data Schedule
(b) No reports on Form 8-K have been filed during the last
quarter of 1998.<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act or 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
MOORE'S LANE PROPERTIES, LTD.
By: 222 Partners, Inc.
General Partner
DATE: March 31, 1999 By:/s/ Steven D. Ezell
President and Director
DATE: March 31, 1999 By:/s/ Michael A. Hartley
Vice President and Director
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following person on
behalf of the Registrant and in the capacities and on the dates
indicated.
MOORE'S LANE PROPERTIES, LTD.
By: 222 Partners, Inc.
General Partner
DATE: March 31, 1999 By:/s/Steven D. Ezell
President and Director
DATE: March 31, 1999 By:/s/Michael A. Hartley
Vice President and Director
Supplemental Information to be Furnished with Reports filed
Pursuant to Section 15(d) of the Act by Registrant Which Have Not
Registered Securities Pursuant to Section 12 of the Act:
No annual report or proxy material has been sent to security
holders.
<PAGE>
Independent Auditors' Report
The Partners
Moore's Lane Properties, Ltd.:
We have audited the accompanying consolidated balance sheets of Moore's Lane
Properties, Ltd. (a limited partnership) and subsidiary as of December 31,
1998 and 1997, and the related consolidated statements of operations,
partners' equity, and cash flows for each of the years in the three-year
period ended December 31, 1998. These consolidated financial statements are
the responsibility of the Partnership's management. Our responsibility is to
express an opinion on these consolidated 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 consolidated 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 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 consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Moore's
Lane Properties, Ltd. and subsidiary at December 31, 1998 and 1997, and the
results of their operations and their cash flows for each of the years in the
three-year period ended December 31, 1998, in conformity with generally
accepted accounting principles.
KPMG LLP
Nashville, Tennessee
January 22, 1999
F-1
<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Consolidated Balance Sheets
December 31, 1998 and 1997
Assets 1998 1997
Cash and cash equivalents $ 5,809 192,693
Restricted cash (note 2) 609,504 742,843
Land and improvements
held for investment (note 5) 1,266,988 1,692,659
Other assets 1,000 1,000
Total Assets $ 1,883,301 2,629,195
Liabilities and Partners' Equity
Liabilities:
Accounts payable and
accrued expenses $ 116,209 47,832
Payable to related party (note 4) 126,500 -
Minority interest in consolidated
joint venture (note 3) 100 100
Total liabilities 242,809 47,932
Partners' equity:
Limited partners (7,500 units
outstanding) 1,636,539 2,397,794
General partners 3,953 3,953
Special limited partners - 179,516
Total partners' equity 1,640,492 2,581,263
Commitments (notes 2, 3, and 4)
Total liabilities and
partners' equity $1,883,301 2,629,195
See accompanying notes to consolidated financial statements.
F-2
<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Consolidated Statements of Operations
Years ended December 31, 1998, 1997, and 1996
1998 1997 1996
Revenue:
Sales:
Sales of land and
improvements $ 2,448,096 4,205,662 -
Cost of land and
improvements sold (720,714) (2,213,987) -
Selling expenses (note 4) (225,609) (416,942) -
Gain on land sale 1,501,773 1,574,733 -
Interest 20,882 5,754 4,995
Miscellaneous 140 - 49,428
Total revenue 1,522,795 1,580,487 54,423
Expenses:
Interest - 22,284 500
Property taxes 176,661 154,459 60,291
Partnership and property
management fee (note 4) 15,604 15,604 15,604
Legal and accounting
(note 4) 21,903 19,310 25,280
General and administrative 10,455 3,538 5,193
Architect and engineering
fees 12,697 13,613 2,857
Total expenses 237,320 228,808 109,725
Net income (loss)
before minority
interest 1,285,475 1,351,679 (55,302)
Minority Interest 378,420 137,102 -
Net income (loss) $ 907,055 1,214,577 (55,302)
Net income (loss) allocated to:
General partners $ - 4,506 (553)
Special limited partners 393,310 391,363 -
Limited partners 513,745 818,708 (54,749)
Net income (loss) per
limited partner
unit $ 68.50 109.16 (7.30)
Weighted average units
outstanding 7,500 7,500 7,500
See accompanying notes to consolidated financial statements.
F-3<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Consolidated Statements of Partners' Equity
Years ended December 31, 1998, 1997, and 1996
<TABLE>
Special
Limited Limited General
partners partners partners Total
units amounts
<S> <C> <C> <C> <C> <C>
Balance at
December 31, 1995 7,500 2,908,835 - - 2,908,835
Net loss - (54,749) - (553) (55,302)
Balance at
December 31, 1996 7,500 2,854,086 - (553) 2,853,533
Net income - 818,708 391,363 4,506 1,214,577
Distributions
to partners (note 6) - (1,275,000) (211,847) - (1,486,847)
Balance at
December 31, 1997 7,500 $2,397,794 179,516 3,953 2,581,263
Net income - 513,745 393,310 - 907,055
Distributions to
partners (note 6) - (1,275,000) (572,826) - (1,847,826)
Balance at
December 31, 1998 7,500 1,636,539 - 3,953 1,640,492
/TABLE>
See accompanying notes to consolidated financial statements.
F-4<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Consolidated Statements of Cash Flows
Years ended December 31, 1998, 1997, and 1996
</TABLE>
<TABLE>
1998 1997 1996
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 907,055 1,214,577 (55,302)
Adjustments to reconcile net income
(loss) to net cash provided by
(used in) operating activities:
(Increase) decrease in
restricted cash 133,339 (439,260) 54,737
Cost of land and improvements
sold 720,714 2,213,987 -
Cost of land improvements (295,043)(1,279,933) (178,302)
(Decrease) increase in accounts
payable and accrued expenses 68,377 (56,237) 48,302
Increase in payable to related
party 126,500 - -
Net cash provided by (used in)
operating activities 1,660,942 1,653,134 (130,565)
Cash flows from financing activities:
Loan proceeds-other - 445,000 -
Principal payments on note
payable - other - (145,000) -
Principal payments on note
payable - private - (300,000) -
Distributions to partners (1,847,826)(1,486,847) -
Net cash used by financing
activities (1,847,826)(1,486,847) -
Net increase (decrease)
in cash and cash equivalents (186,884) 166,287 (130,565)
Cash and cash equivalents
at beginning of year 192,693 26,406 156,971
Cash and cash equivalents
at end of year $ 5,809 192,693 26,406
Supplemental Disclosures of Cash
flow information:
Cash paid during the year for
interest $ - 15,993 500
</TABLE>
See accompanying notes to consolidated financial statements.
F-5
<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Notes to Consolidated Financial Statements
December 31, 1998 and 1997
(1) Summary of Significant Accounting Policies
(a) Organization
Moore's Lane Properties, Ltd. (the Partnership) was
organized on December 10, 1985 as a Tennessee limited
partnership to acquire and hold for investment
approximately 174 acres of unimproved real property in
Williamson County, Tennessee. On May 30, 1986, a public
offering of limited partnership units closed whereby the
Partnership issued 7,500 limited partnership units and
the original limited partner withdrew. During 1997,
general partner W. Gerald Ezell sold his partnership
interest, and the Partnership was amended to convert his
interest to a "Special limited" partner interest. His
general partner responsibilities were transferred to the
remaining general partner, 222 Partners, Inc. The
Partnership prepares financial statements and Federal
income tax returns on the accrual method and includes
only those assets, liabilities and results of operations
which relate to the business of the Partnership.
(b) Principles of Consolidation
The consolidated financial statements include the
accounts of Moore's Lane Properties, Ltd. and the
accounts of a majority-owned joint venture. All
significant intercompany accounts and transactions have
been eliminated.
(c) Estimates
Management of the partnership has made certain estimates
and assumptions to prepare these financial statements in
accordance with generally accepted accounting principles.
Actual results could differ from those estimates.
(d) Land and Improvements Held for Investment
Land and improvements held for investment is recorded at
cost and include approximately 21 and 30 acres at
December 31, 1998 and 1997, respectively. Land costs
include amounts to acquire and hold land, including
interest and property taxes during the development
period. Costs to hold land, including interest,
insurance, and property taxes were charged to expense in
1998 since development was substantially complete. Land
improvement costs include development costs expended
subsequent to the acquisition of the tract.
F-6<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Notes to Consolidated Financial Statements
(1) Summary of Significant Accounting Policies (continued)
(e) Impairment of Long-Lived Assets and Long-Lived Assets to
be Disposed of
The Partnership accounts for long-lived assets in
accordance with the provisions of Statement of Financial
Accounting Standards (SFAS) No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets
to be Disposed of." This Statement requires that
long-lived assets to be disposed of be reported at the
lower of the carrying amount or fair value less estimated
costs to sell. If such assets are considered impaired,
the impairment to be recognized is measured by the amount
by which the carrying amount of the assets exceeds the
fair value of the assets less estimated costs to sell.
Impairment is recognized through the establishment of an
allowance for impairment with a corresponding charge to
operations. Losses upon the sale of the assets are
charged to the allowance. Based upon management's
analysis, the Partnership's land and improvements held
for investment does not meet the definitions of
impairment under SFAS No. 121. Accordingly, land and
improvements held for investment is recorded at cost with
no allowance for impairment necessary.
(e) Cash and Cash Equivalents
The Partnership considers all short-term investments with
original maturities of three months or less at the date
of purchase to be cash equivalents. Cash belonging to
the Partnership is combined in an account with funds from
other partnerships related to the general partner.
(f) Revenue Recognition
Income from sales of land and improvements held for investment
is generally recorded on the accrual basis when the buyer's
financial commitment is sufficient to provide economic
substance to the transaction, and when other criteria of SFAS
No. 66 " Accounting for Sales of Real Estate," are satisfied.
For sales of real estate where both cost recovery is
reasonably certain and the collectibility of the contract
price is reasonably assured, but the transaction does not meet
the remaining requirements to be recorded on the accrual
basis, profit is deferred and recognized under the
F-7
<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Notes to Consolidated Financial Statements
(1) Summary of Significant Accounting Policies (continued)
(f) Revenue Recognition(continued)
installment method, which recognizes profit as collections of
principal are received. If developments subsequent to the
adoption of the installment method occur which cause the
transaction to meet the requirements of the full accrual
method, the remaining deferred profit is recognized at that
time. Any losses on sales of real estate are recognized at
the time of the sale.
(g) Income Taxes
No provision has been made for Federal or state income
taxes since such taxes are the personal responsibility of the
partners.
Annually, the partners receive, from the Partnership, IRS Form
K-1's which provide them with their share of taxable income
(or loss), deductions and other tax information. The only
difference between the tax basis and reported amounts of the
Partnership's assets and liabilities is the carrying value of
land and improvements held for investment. The income tax
basis includes additional land development costs not
capitalized for book purposes.
(h) Partnership Allocations
Net profits, losses and distributions of cash flow of the
Partnership are allocated to the partners in accordance with
the Partnership agreement as follows:
Net profits are allocated first to any partner with a negative
balance in their capital account, determined at the end of the
taxable year as if the Partnership had distributed cash flow,
in proportion to the negative capital balance account of all
partners until no partner's capital account is negative. Net
profit allocations are then made to the limited partners up to
the difference between their capital account balances and the
sum of their adjusted capital contributions (capital balance,
net of cumulative cash distributions in excess of preferred
returns - 12% annual cumulative return on capital
contributed). Any remaining net profit is allocated 99% to
the limited partners and 1% to the general partners until the
taxable year in which cumulative distributions to the limited
partners equal their adjusted capital contribution plus an
unpaid preferred return. Net profits are then allocated to
the general partners until the ratio of the general
partners' capital account balance to the capital account
balances, in excess of adjusted capital contributions and
F-8<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Notes to Consolidated Financial Statements
(1) Summary of Significant Accounting Policies (continued)
(h) Partnership Allocations(continued)
unpaid preferred returns, of all limited partners is 31%
to 69%. Thereafter, profits are generally allocated 31%
to the general partners and 69% to the limited partners.
Net losses are allocated to the 99% to the limited
partners and 1% to the general partner.
Partnership distributions are allocated to the limited
partners in an amount equal to their preferred return
(12% annual cumulative return on capital contributed) to
the extent unpaid to date. Any remaining distributions
are allocated 99% to the limited partners and 1% to the
general partners until the limited partners have received
an amount equal to their adjusted capital contributions,
and thereafter, 69% to the limited partners and 31% to
the general partners.
The Special limited partners, created with the sale of W.
Gerald Ezell's general partnership interest in 1997, are
allocated income, losses and distributions previously
allocated to the general partner.
(i) Comprehensive Income
Effective January 1, 1998, the Partnership adopted SFAS
No. 130 "Reporting Comprehensive Income". SFAS No. 130
establishes standards for reporting and presentation of
comprehensive income and its components in a full set of
financial statements and requires that all components of
comprehensive income be reported in a financial statement
that is displayed with the same prominence as other
financial statements. Comprehensive income is defined as
the change in equity of a business enterprise, during a
period, associated with transactions and other events and
circumstances from non-owner sources. It includes all
changes in equity during a period except those resulting
from investments by owners and distributions to owners.
During the years ended December 31, 1998 and 1997, the
Partnership had no components of other comprehensive
components ofincome. Accordingly, comprehensive income
for each of the years was the same as net income(loss).
<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Notes to Consolidated Financial Statements
(2) Restricted Cash
At December 31, 1998 and 1997, the Partnership has restricted
cash balances of $609,504 and $742,843, respectively, to be
used to fund property improvements, consisting of road and
utility work, and property taxes.
(3) Moore's Lane Venture Associates
On May 29, 1986, Moore's Lane Venture Associates (the Joint
Venture) was formed with the Partnership and Southeast Venture
Companies (Southeast) as joint venturers. On March 4, 1987,
the Partnership contributed its land held for investment to
the Joint Venture. The contribution of land was accounted for
at book value.
Southeast will contribute services for overseeing the
implementation of the master land use plan and ensuring that
any improvements proceed on schedule. The joint venture
agreement provides that Southeast will receive 17% of the
proceeds of any disposition of the property after the limited
partners have received an amount equal to their capital
contributions plus their preferred return as defined in the
partnership agreement.
(4) Related Party Transactions
The General Partners and their affiliates have been
actively involved in managing the Partnerships. At
December 31, 1998, the Partnership had a payable to an
affiliate of $126,500. Affiliates of the general
partners receive fees and commissions as consideration
for performing certain services. Expenses incurred for
these services during 1998, 1997, and 1996 are as
follows: 1998 1997 1996
Commission paid to minority
interest holder $ 73,443 130,810 -
Development fees
(Selling Expense) 48,962 83,199 -
Accounting fees 3,603 1,750 2,900
Land management fee 15,604 15,604 15,604
F-9
<PAGE>
MOORE'S LANE PROPERTIES, LTD. AND SUBSIDIARY
(A Limited Partnership)
Notes to Consolidated Financial Statements
(5) Land and Improvements Held for Investment
The components of land and improvements held for investment at
December 31, are as follows: 1998 1997
Land and carrying costs $ 581,131 922,409
Land Improvements 685,857 770,250
$ 1,266,988 1,692,659
Aggregate cost for Federal income tax purposes for this
property was $1,330,706 and $1,725,060 at December 31,
1998 and 1997, respectively.
(6) Distributions
For the years ended December 31, 1998 and 1997, the
Partnership made distributions of $1,847,826 and
$1,486,847, respectively. Of these amounts, $1,275,000
and $1,275,000 ($170 and $170 per unit), respectively,
were allocated to the limited partners, $572,826, and
$211,847, respectively, were allocated to the Special limited
partners, and $-0- and $-0- were allocated to the general
partners. There were no distributions in 1996.
(7) Fair Value of Financial Instruments
At December 31, 1998 and 1997, the Partnership had
financial instruments including cash, restricted cash,
accounts payable, and accrued expenses and payable to
related party. The carrying amounts of these financial
instruments approximate their fair value because of the
short term nature of those financial instruments.
(8) Subsequent Event
On January 21, 1999, the Partnership sold 6.5 acres of land for
approximately $1.5 Million gross proceeds. From the sale, $706,521
was distributed to the partners.
F-10<PAGE>
Independent Auditors' Report
The Partners
Moore's Lane Properties, Ltd.:
Under date of January 22, 1999, we reported on the consolidated balance
sheets of Moore's Lane Properties, Ltd. and subsidiary as of December 31,
1998 and 1997, and the related consolidated statements of operations,
partners' equity, and cash flows for each of the years in the three-year
period ended December 31, 1998. The consolidated financial statements and
our report thereon are included elsewhere herein. In connection with our
audits of the aforementioned consolidated financial statements, we have also
audited the related financial statement schedule following. This financial
statement schedule is the responsibility of the Partnership's management.
Our responsibility is to express an opinion on this financial statement
schedule based on our audits.
In our opinion, such financial statement schedule, when considered in
relation to the basic consolidated financial statements taken as a whole,
presents fairly, in all material respects, the information set forth therein.
KPMG LLP
Nashville, Tennessee
January 22, 1999
S-1
<PAGE>
<TABLE>
MOORE'S LANE PROPERTIES, LTD. and Subsidiary
(A Limited Partnership)
Schedule III
Real Estate and Accumulated Depreciation
Initial Cost to Cost capitalized Gross amount at
Partnership subsequent which carried
to acquisition at close of period
<CAPTION>
Description Encum- Land Buildings Improve- Carrying Land Buildings Total Accumu- Date of Date
brances and improve- ments costs and improve- lated de- construc- acquired
ments ments preciation tion
<S>___________ <C>______ <C>____ <C>________<C>________<C>________<C>____<C>________<C>_____ <C>_______<C>_______ <C>____
20 acres of undeveloped
land in Williamson county,
Tennessee $ - $ 331,144 - 685,857 249,987 331,144 935,844 1,266,988 - - 12/11/85
S-2
</TABLE>
<PAGE>
MOORE'S LANE PROPERTIES, LTD. and Subsidiary
(A Limited Partnership)
Schedule III
Real Estate and Accumulated Depreciation
(continued)
1998 1997 1996
(1) Balance at beginning $ 1,692,659 2,626,713 2,448,411 of
Period
Additions during period:
Improvements 295,043 1,279,933 178,302
Deductions during period:
Cost of real estate
sold 720,714 2,213,987 -
Balance at close of
period $ 1,266,988 1,692,659 2,626,713
(2) Aggregate cost for
Federal income tax
purposes $ 1,330,706 1,725,060 2,880,071
See accompanying independent auditors' report.
S-2
<PAGE>
Exhibits filed pursuant to Item 14 (a) (3):
MOORE'S LANE PROPERTIES, LTD.
(A Tennessee Limited Partnership)
Exhibit Index
Exhibit
3 Amended and Restated Certificate and Agreement of Limited
Partnership, incorporated by reference to Exhibit to a
Prospectus of Registrant dated April 22, 1986 (Registration
No. 33-3395-A)
22 Subsidiaries
27 Financial Data Schedule
<PAGE>
Exhibit 22. Subsidiaries
MOORE'S LANE PROPERTIES, LTD.
(A Tennessee Limited Partnership)
MOORE'S LANE VENTURE ASSOCIATES
A Tennessee Joint Venture
One Belle Meade Place
4400 Harding Road, Suite 500
Nashville, TN 37205
EIN 62-1310146
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000790609
<NAME> MOORE'S LANE PROPERTIES LTD.
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 5,809
<SECURITIES> 609,504
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 1,266,988
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,883,301
<CURRENT-LIABILITIES> 242,709
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,640,492
<TOTAL-LIABILITY-AND-EQUITY> 1,883,301
<SALES> 2,448,096
<TOTAL-REVENUES> 1,522,795
<CGS> 720,714
<TOTAL-COSTS> 946,323
<OTHER-EXPENSES> 237,320
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 907,055
<INCOME-TAX> 0
<INCOME-CONTINUING> 907,055
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 907,055
<EPS-PRIMARY> 68.50
<EPS-DILUTED> 68.50
</TABLE>
