SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act
of 1934
For Quarter Ended June 30, 1997
Commission File Number: 1-9302
FORUM RETIREMENT PARTNERS, L.P.
(Exact name of registrant as specified in its charter)
Organized in Delaware I.R.S. No.35-1686799
10400 Fernwood Road
Bethesda, MD 20817
Telephone: (301) 380-9000
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name Of Each Exchange On Which Registered
Preferred Depository Units American Stock Exchange
Representing Preferred
Limited Partners' Interests
Securities registered pursuant to Section 12(g) of the Act: None
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
<PAGE>
INDEX
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
<TABLE>
<CAPTION>
<S> <C>
PART I. FINANCIAL INFORMATION PAGE
- ----------------------------- ----
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets --
June 30, 1997 and December 31, 1996 3
Condensed Consolidated Statements of Operations --
Three and six months ended June 30, 1997 and 1996 4
Condensed Consolidated Statement of Partners' Equity --
June 30, 1997 and December 31, 1996 5
Condensed Consolidated Statements of Cash Flows --
Six months ended June 30, 1997 and 1996 6
Notes to Condensed Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. OTHER INFORMATION
- --------------------------
Item 1. Legal Proceedings 12
Item 2. Changes in Securities 12
Item 3. Defaults Upon Senior Securities 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 13
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
------------ ------------
(Unaudited)
ASSETS
------
<S> <C> <C>
Cash and cash equivalents $ 4,252 $ 6,199
Restricted Cash 3,355 2,663
Other assets 7,199 4,628
Property and equipment, net 98,064 97,540
Deferred financing costs, net 1,344 1,528
----------- -----------
TOTAL ASSETS $ 114,214 $ 112,558
=========== ============
LIABILITIES AND PARTNERS' EQUITY
--------------------------------
Debt $ 47,434 $ 47,984
Other liabilities 9,392 8,950
Deferred management fees due to parent of general partner 15,780 15,780
---------- ----------
TOTAL LIABILITIES 72,606 72,714
---------- ----------
General partner's equity in subsidiary partnership 254 236
Partners' equity:
General partner 519 502
Limited partners (15,285 units issued and outstanding) 40,835 39,106
---------- ----------
TOTAL PARTNERS' EQUITY 41,354 39,608
---------- ----------
TOTAL LIABILITIES AND PARTNERS' EQUITY $ 114,214 $ 112,558
========== ==========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Six Months
Ended Ended
June 30, June 30,
-------------------- -------------------
1997 1996 1997 1996
------- -------- -------- -------
(in thousands except per unit amounts)
Revenues:
<S> <C> <C> <C> <C>
Routine revenue $ 12,671 $ 11,692 $25,067 $23,122
Ancillary revenue 2,397 1,475 4,271 3,164
Other income 99 29 140 80
---------- -------- ------- -------
TOTAL REVENUES 15,167 13,196 29,478 26,366
---------- -------- ------- -------
Costs and expenses:
Routine expenses 8,746 8,162 17,495 16,030
Ancillary costs 1,682 1,238 3,220 2,528
Management fees to MSLS 1,209 1,051 2,347 2,092
General and administrative 45 233 146 454
Litigation 122 2 159 116
Depreciation 833 950 1,777 1,898
Interest 1,298 1,301 2,570 2,612
---------- -------- ------- -------
TOTAL COSTS AND EXPENSES 13,935 12,937 27,714 25,730
---------- -------- ------- -------
Income before general partner's interest in income of subsidiary partnership 1,232 259 1,764 636
General partner's interest in income of subsidiary partnership 13 3 18 6
---------- -------- ------- -------
NET INCOME $ 1,219 $ 256 $ 1,746 $ 630
========== ======== ======= =======
General partner's interest in net income $ 12 $ 2 $ 17 $ 6
========== ======== ======= =======
Limited partners' interest in net income $ 1,207 $ 254 $ 1,729 $ 624
========== ======== ======= =======
Average number of units outstanding 15,285 15,285 15,285 15,285
========== ======== ======= =======
Net income per limited partner unit $ 0.08 $ 0.02 $ 0.11 $ 0.04
========== ======== ======= =======
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
CONDENSED CONSOLIDATED STATEMENT OF PARTNERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
General Limited
Partner Partners
--------- ---------
(in thousands)
<S> <C> <C>
Balances at January 1, 1997 $ 502 $ 39,106
Net Income 17 1,729
--------- ---------
Balances at June 30, 1997 $ 519 $ 40,835
========= =========
Accumulated balances:
Capital contributions $ 1,173 $ 116,279
Offering costs (4) (6,715)
Cash distributions (255) (29,679)
Accumulated losses (395) (39,050)
--------- ---------
Balances at June 30, 1997 $ 519 $ 40,835
========= =========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
----------------------------------
1997 1996
----------- ---------
(in thousands)
<S> <C> <C>
CASH PROVIDED BY OPERATING ACTIVITIES $ 1,664 $ 3,412
----------- ---------
CASH USED IN INVESTING ACTIVITIES
Additions to property and equipment (2,301) (2,086)
----------- ---------
Cash flows from financing activities:
Reduction of long-term debt (550) (499)
Payments on subordinated debentures (68) (17)
Net (increase) decrease in restricted cash (692) 24
----------- ---------
CASH USED IN FINANCING ACTIVITIES (1,310) (492)
----------- ---------
Increase (decrease) in cash and cash equivalents (1,947) 834
Cash and cash equivalents at beginning of period 6,199 2,960
----------- ---------
Cash and cash equivalents at end of period $ 4,252 $ 3,794
=========== =========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
<PAGE>
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
- -------------------------
The accompanying condensed consolidated financial statements of Forum Retirement
Partners, L.P. (the "Partnership") and subsidiary partnership have been prepared
by the Partnership without audit. Certain information and footnote disclosures
normally included in financial statements presented in accordance with generally
accepted accounting principles have been condensed or omitted. The Partnership
believes the disclosures made are adequate to make the information presented not
misleading. However, the condensed consolidated financial statements should be
read in conjunction with the consolidated financial statements and notes thereto
included in the Partnership's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996.
In the opinion of the Partnership, the accompanying unaudited condensed
consolidated financial statements reflect all adjustments necessary to present
fairly the financial position of the Partnership as of June 30, 1997 and
December 31, 1996, and the results of operations and cash flows for the three
and six months ended June 30, 1997. Interim results are not necessarily
indicative of fiscal year performance because of the impact of seasonal and
short-term variations.
2. Ownership Interest of the General Partner and its Affiliates
- ----------------------------------------------------------------
Forum Retirement, Inc., a wholly-owned subsidiary of Forum Group, Inc. ("Forum
Group"), is the general partner of the Partnership (the "General Partner") and
owns a one percent interest in the Partnership and a one percent partnership
interest in a subsidiary operating partnership in which the Partnership owns a
ninety-nine percent limited partnership interest. The General Partner's interest
in the subsidiary operating partnership is reflected in the statements of
operations as a reduction of the income or loss of the Partnership. Forum Group
beneficially owns approximately 79% of the outstanding Preferred Depository
Units (the "Units") representing preferred limited partner interests in the
Partnership.
On June 21, 1997, HMC Senior Communities, Inc. ("HMCSC"), a wholly-owned
subsidiary of Host Marriott Corporation ("Host Marriott"), acquired all of the
outstanding stock of Forum Group from Marriott Senior Living Services, Inc.
("MSLS"), a subsidiary of Marriott International, Inc. ("MI"). In connection
with the acquisition, Forum Group assigned to MSLS its interest as manager under
a long-term management agreement (the "Management Agreement") for the nine
senior living communities owned by the Partnership.
3. Commitments and Contingencies
- ---------------------------------
On January 24, 1994, The Russell F. Knapp Revocable Trust (the "Plaintiff")
filed a complaint (the "Iowa Complaint") in the United States District Court for
the Northern District of Iowa (the "Iowa Court") against the General Partner
alleging breach of the partnership agreement of the Partnership ("Partnership
Agreement"), breach of fiduciary duty, fraud, insider trading, and civil
conspiracy/aiding and abetting. The Plaintiff subsequently amended the Iowa
Complaint, adding Forum Group as a defendant. The Iowa Complaint is a derivative
action seeking recovery of damages and other relief on behalf of, and not from,
the Partnership. The Iowa Complaint alleged, among other things, that the
Plaintiff holds a substantial number of Units, that the Board of Directors of
the General Partner is not comprised of a majority of independent directors as
required by the Partnership Agreement and as allegedly represented in the
Partnership's 1986 Prospectus for its initial public offering, and that the
General Partner's Board of Directors has approved and/or acquiesced to an 8%
management fee charged by Forum Group under the Management Agreement. The Iowa
Complaint further alleged that the "industry standard" for such fees is 4%,
thereby resulting in an "overcharge" to the Partnership estimated by the
Plaintiff at $1.8 million per annum beginning in 1994. The Plaintiff sought the
restoration of certain former directors to the Board of Directors of the General
Partner and the removal of certain other directors from the Board, an injunction
prohibiting the payment of an 8% management fee, and unspecified compensatory
and punitive damages. On April 3, 1995, the Iowa Court entered an order
dismissing the Iowa Complaint on jurisdictional grounds. Although the Plaintiff
filed a notice of appeal of the Iowa Court's ruling, it subsequently dismissed
this appeal.
<PAGE>
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(continued)
On June 15, 1995, the Plaintiff filed a complaint (the "Indiana Complaint") in
the United States District Court for the Southern District of Indiana (the
"Indiana Court") against the General Partner and Forum Group seeking essentially
the same relief. The defendants moved to dismiss the Indiana Complaint for
failure to state a claim for which relief could be granted and, in response, on
December 11, 1995 the Plaintiff amended the Indiana Complaint. The defendants
moved to dismiss the amended complaint on similar grounds, and on May 17, 1996,
the Indiana Court ruled on the defendant's motion by dismissing without
prejudice two of the four counts contained in the amended complaint, namely the
counts for alleged insider trading and civil conspiracy/aiding and abetting. The
litigation is in the pretrial phase, and both the Plaintiff and the defendants
are awaiting the Indiana Court's ruling on their respective motions for summary
judgment. The Indiana Court has set a trial date for December 8, 1997. The
General Partner intends to vigorously defend against this litigation.
<PAGE>
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
Forward-Looking Statements
- --------------------------
Certain matters discussed in the Form 10-Q are forward-looking statements within
the meaning of the Private Litigation Reform Act of 1995 and as such may involve
known and unknown risks, uncertainties, and other factors which may cause the
actual results, performance or achievements of the Partnership to be different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Although the Partnership believes the
expectations reflected in such forward-looking statements are based upon
reasonable assumptions, it can give no assurance that its expectation will be
attained. These risks are detailed from time to time in the Partnership's
filings with the Securities and Exchange Commission. The Partnership undertakes
no obligation to publicly release the result of any revisions to these
forward-looking statements that may be made to reflect any future events or
circumstances.
Results of Operations
- ---------------------
THREE MONTHS ENDED JUNE 30, 1997 AND 1996. As of June 30, 1997 and 1996, the
Partnership owned nine senior living communities, all of which are currently
managed by MSLS. The Partnership reported net income of $1,219,000 for the three
months ended June 30, 1997 compared to net income of $256,000 for the same
period in 1996. Total revenues for the three months ended June 30, 1997
increased by $1,971,000 or 14.9%, to $15,167,000 compared to the same period in
1996. Total revenues consist primarily of routine service and ancillary service
revenues. Routine service revenues are generated from monthly charges for
independent living units and daily charges for assisted living suites and
nursing beds which are recognized monthly based on the terms of the residents'
agreements. Ancillary service revenues are generated on a "fee for service"
basis for supplementary items requested by residents and are recognized as the
services are provided. The revenue increase is primarily the result of increases
in residency fees and charges in the independent living, assisted living and
nursing components, the favorable impact of recently opened expansion units and
increases in therapy and other ancillary healthcare services.
Combined average occupancy (calculated based on the number of units occupied
during the respective period) at the nine senior living communities was 94.1%
for the three months ended June 30, 1997, a slight decrease from the prior year.
The combined average monthly rental rate per occupied unit (calculated using
revenue generated from the respective rental components and excluding non-rental
revenues) increased 6% for the three month period ended June 30, 1997 compared
to the same period in 1996, with each of the nine communities experiencing
increases.
Routine expenses and ancillary costs for the three month period ended June 30,
1997 increased $1,028,000, or 10.9%, to $10,428,000 compared to the same period
in 1996. The increased costs and expenses resulted from a higher level of
nursing and therapy staffing as well as an increase in the amount of therapy and
ancillary healthcare services, resulting from the expansions described above.
These recently opened expansion units at four communities impacted the costs
associated with the higher level of housekeeping and dining services.
The foregoing resulted in an increase in Net Operating Income ("NOI") of
$715,000, or 26.3%, to $3,431,000. NOI is calculated as routine and ancillary
revenues ("operating revenues") less routine and ancillary expenses ("operating
expenses") and management fees. Operating margin (operating revenues less
operating expenses) as a percentage of operating revenues increased from 28.6%
for the three month period ended June 30, 1996 to 30.8% for the comparable
period in 1997.
Management fees increased as a function of revenue. Total interest expense for
the three months ended June 30, 1997 decreased by $3,000 compared to total
interest expense for the same period in 1996 due primarily to scheduled
principal amortization of long-term debt.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(continued)
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
SIX MONTHS ENDED JUNE 30, 1997 AND 1996. The Partnership reported net income of
$1,746,000 for the six months ended June 30, 1997 compared to net income of
$630,000 for the same period in 1996. Total revenues for the six months ended
June 30, 1997 increased by $3,112,000, or 11.8%, to $29,478,000 compared to the
same period last year.
Combined average occupancy (calculated based on the number of units occupied
during the respective period) at the nine communities was 93.7% for the six
months ended June 30, 1997, a decrease of approximately one half percentage
point compared to the same period in 1996. The combined average monthly rental
rate per occupied unit (calculated using revenue generated from the respective
rental components and excluding non-rental revenues) increased 6% for the six
months ended June 30, 1997 compared to the same period in 1996, with each of the
nine communities experiencing increases. The revenue increase was favorably
impacted by recently opened expansion units and increases in therapy and other
ancillary services.
Routine expenses and ancillary costs for the six months ended June 30, 1997
increased $2,157,000, or 11.6%, to $20,715,000 compared to the same period in
1996. The increased costs and expenses resulted primarily from a generally
higher level of nursing and therapy healthcare staffing, the increased provision
of therapy and other ancillary healthcare services and other unremarkable
operational trends. NOI increased $640,000, or 11.4%, to $6,276,000 and
operating margin remained unchanged at 29.4%.
Management fees increased as a function of revenue. Total interest expense for
the six months ended June 30, 1997 decreased by $42,000 compared to total
interest expense for the same period in 1996 due primarily to a scheduled
principal amortization of long-term debt.
INCOME TAXES. The Omnibus Budget Reconciliation Act of 1987 provides that
certain publicly traded partnerships will be treated as corporations for federal
income tax purposes. A grandfather provision delays corporate tax status until
1998 for publicly traded partnerships in existence prior to December 18, 1987.
On August 8, 1988 the General Partner was authorized by the limited partners to
do all things deemed necessary or desirable to insure that the Partnership is
not treated as a corporation for federal income tax purposes. Alternatives
available to avoid corporate taxation after 1998 include: (i) selling or
otherwise disposing of all or substantially all of the Partnership's assets
pursuant to a plan of liquidation and (ii) converting the Partnership into a
real estate investment trust or other type of legal entity. Such actions are
prohibited or restricted under the Partnership's current financing and may
require the granting of a waiver by the lender thereunder. There can be no
assurance that any such waiver would be granted. There can be no assurance that
the Partnership will avoid being taxed as a corporation for federal income tax
purposes.
On August 5, 1997, President Clinton signed the Taxpayer Relief Act of 1997 (the
"Act"). A provision in the Act allows certain publicly traded partnerships which
would become subject to tax as a corporation beginning in 1998 to elect to be
subject to a special tax on gross income from its active conduct of a trade or
business, and continue to avoid being treated as a corporation for federal
income tax purposes. The tax generally applies to a partnership's gross income
at the rate of three and one half percent, effective for taxable years beginning
after December 31, 1997. The General Partner intends to evaluate the impact
making the election allowed by the Act would have on the Partnership.
Financial condition
- -------------------
LIQUIDITY AND CAPITAL RESOURCES. At June 30, 1997, the Partnership had cash and
cash equivalents of $4,252,000 and restricted cash of $3,355,000. Cash provided
by operating activities was $1,664,000 for the six months ended June 30, 1997,
$1,748,000 less than the prior year due principally to an increase in accounts
receivable and a decrease in accounts payable and accrued expenses. The
Partnership believes that it has adequate liquidity to meet its foreseeable
working capital requirements.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(continued)
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
The Partnership has ongoing expansion programs relating to certain of its
communities in an effort to further improve the Partnership's results of
operations. Currently, four expansion projects have been completed, two
expansion projects are under construction and another three expansion projects
are in active development or design. Two of the three projects currently in
development or design are expected to begin construction by the end of 1997. The
four completed projects increased the number of living and nursing units owned
by the Partnership by approximately 4% at a capital cost of $6.4 million. The
five projects which are either under construction or are in active development
or design are expected to increase the number of living and nursing units owned
by the Partnership by approximately 16% at an estimated capital cost of $21.9
million. The expansions are designed to modify the uses of or add capacity to
existing facilities without incurring substantial land acquisition and common
area build-out costs. Certain expansions will require additional regulatory
approvals. The Partnership expended $2,301,000 and $2,086,000 for the six months
ended June 30, 1997 and 1996, respectively, related to these expansion projects,
and renewal and replacement projects for existing properties.
The Partnership is financing and intends to continue to finance this expansion
program from the Partnership's cash flow from operations. If cash flow from
operations is insufficient to complete future expansion on a timely basis, the
expansion may be delayed, reduced in scope or discontinued. The terms of the
Partnership's current long-term debt agreement restrict the Partnership from
incurring additional third-party financing (other than $1 million of equipment
financing) and prohibit the imposition of liens on the Partnership's assets.
There can be no assurance that a waiver can be obtained from the lender to
permit any third-party financing, or whether, when and on what terms any such
financing may be available. As a result of the capital required to fund the
expansion program, the Partnership does not expect to make distributions in
respect of limited partner units in the foreseeable future.
The implementation of the expansion program and its impact on the value of an
investment in the Partnership is subject to a number of variables, including
without limitation, the availability of cash flow from operations, the ability
to obtain required zoning variances and permits from local governmental
authorities and the timing thereof, whether development and construction costs
are higher or lower than anticipated, whether construction is completed faster
or slower than anticipated, whether newly added living units are occupied faster
or slower than anticipated and whether operating costs are higher or lower than
anticipated.
Cash used in financing activities was $1,310,000 for the six months ended June
30, 1997, an increase of $818,000 over the prior year principally due to an
increase in restricted cash.
<PAGE>
PART II. Other Information
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
Item 1. Legal Proceedings
- --------------------------
On January 24, 1994, The Russell F. Knapp Revocable Trust (the "Plaintiff")
filed a complaint (the "Iowa Complaint") in the United States District Court for
the Northern District of Iowa (the "Iowa Court") against the General Partner
alleging breach of the Partnership Agreement, breach of fiduciary duty, fraud,
insider trading, and civil conspiracy/aiding and abetting. The Plaintiff
subsequently amended the Iowa Complaint, adding Forum Group as a defendant. The
Iowa Compliant is a derivative action seeking damages and other relief on behalf
of, and not from, the Partnership. The Iowa Complaint alleged, among other
things, that the Plaintiff holds a substantial number of Units, that the Board
of Directors of the General Partner is not comprised of a majority of
independent directors as required by the Partnership Agreement and as allegedly
represented in the Partnership's 1986 Prospectus for its initial public
offering, and that the General Partner's Board of Directors has approved and/or
acquiesced to an 8% management fee charged by Forum Group under the Management
Agreement. The Iowa Complaint further alleged that the "industry standard" for
such fees is 4%, thereby resulting in an "overcharge" to the Partnership
estimated by the Plaintiff at $1.8 million per annum beginning in 1994. The
Plaintiff sought the restoration of certain former directors to the Board of
Directors of the General Partner and the removal of certain other Directors from
the Board, an injunction prohibiting the payment of an 8% management fee, and
unspecified compensatory and punitive damages. On April 3, 1995, the Iowa Court
entered an order dismissing the Iowa Complaint on jurisdictional grounds.
Although the Plaintiff filed a notice of appeal of the Iowa Court's ruling, it
subsequently dismissed this appeal.
On June 15, 1995, the Plaintiff filed a complaint (the "Indiana Complaint") in
the United States District Court for the Southern District of Indiana (the
"Indiana Court") against the General Partner and Forum Group seeking essentially
the same relief. The defendants moved to dismiss the Indiana Complaint for
failure to state a claim for which relief could be granted and, in response, on
December 11, 1995 the Plaintiff amended the Indiana Complaint. The defendants
moved to dismiss the amended complaint on similar grounds, and on May 17, 1996,
the Indiana Court ruled on the defendant's motion by dismissing without
prejudice two of the four counts contained in the amended complaint, namely the
counts for alleged insider trading and civil conspiracy/aiding and abetting. The
litigation is in pretrial phase, and both the Plaintiff and the defendant are
awaiting the Indiana Court's ruling on their respective motions for summary
judgment. The Indiana Court has set a trial date for December 8, 1997. The
General Partner intends to vigorously defend against this litigation.
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.
<PAGE>
PART II. Other Information (continued)
FORUM RETIREMENT PARTNERS, L.P. AND SUBSIDIARY PARTNERSHIP
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
(a) Exhibits
None.
(b) Reports on Form 8-K.
July 7, 1997 - Report of the announcement that HMC Senior
Communities, Inc., a wholly-owned subsidiary of Host Marriott
Corporation, acquired all of the outstanding stock of Forum
Group, Inc. ("Forum Group") from Marriott Senior Living Services,
Inc., a subsidiary of Marriott International, Inc. Forum Group
owns all of the outstanding stock of Forum Retirement, Inc., the
general partner of the Partnership, and also indirectly owns
approximately 79% of the outstanding preferred depository units
of the Partnership.
<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 hereunto duly authorized.
FORUM RETIREMENT PARTNERS, L.P.,
a Delaware Limited Partnership
By: FORUM RETIREMENT, INC., GENERAL PARTNER
-------------------------------------------
By: /s/ Donald D. Olinger
-------------------------------------------
Donald D. Olinger
Vice President
August 14, 1997
- ---------------
Date
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Retirement Partners, L.P. Condensed Consolidated Balance Sheet and Condensed
Consolidated Statement of Operations as of and for the six months ended June 30,
1997 and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000804752
<NAME> Forum Retirement Partners, L.P.
<MULTIPLIER> 1,000
<CURRENCY> $
<S> <C>
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> Dec-31-1997
<PERIOD-START> Jan-1-1997
<PERIOD-END> Jun-30-1997
<EXCHANGE-RATE> 1
<CASH> 4,252
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 131,564
<DEPRECIATION> 33,501
<TOTAL-ASSETS> 114,214
<CURRENT-LIABILITIES> 0
<BONDS> 47,434
0
0
<COMMON> 0
<OTHER-SE> 41,354
<TOTAL-LIABILITY-AND-EQUITY> 114,214
<SALES> 29,478
<TOTAL-REVENUES> 29,478
<CGS> 0
<TOTAL-COSTS> 20,715
<OTHER-EXPENSES> 4,429
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,570
<INCOME-PRETAX> 1,746
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,746
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,746
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>