<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 March 31, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________ to ___________
Commission file number 0-18952
NTS-PROPERTIES PLUS LTD.
(Exact name of a registrant as specified in its charter)
Florida 61-1126478
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10172 Linn Station Road
Louisville, Kentucky 40223
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (502) 426-4800
Not Applicable
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, and (2) has been subject to such filing requirements
for the past 90 days.
YES X NO
Exhibit Index: See page 15
Total Pages: 16
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TABLE OF CONTENTS
Pages
PART I
Item 1. Financial Statements
Balance Sheets and Statement of Partners' Equity
as of March 31, 1996 and December 31, 1995 3
Statements of Operations
For the three months ended March 31, 1996 and 1995 4
Statements of Cash Flows
For the three months ended March 31, 1996 and 1995 5
Notes To Financial Statements 6-7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8-14
PART II
1. Legal Proceedings 15
2. Changes in Securities 15
3. Defaults upon Senior Securities 15
4. Submission of Matters to a Vote of Security Holders 15
5. Other Information 15
6. Exhibits and Reports on Form 8-K 15
Signatures 16
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<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
NTS-PROPERTIES PLUS LTD.
BALANCE SHEETS AND STATEMENT OF PARTNERS' EQUITY
<CAPTION>
As of As of
March 31, 1996 December 31, 1995*
-------------- ------------------
<S> <C> <C>
ASSETS
Cash and equivalents $ 12,263 $ 36,269
Cash and equivalents - restricted 37,336 17,438
Accounts receivable, net of allowance
for doubtful accounts of $4,986 (1996)
and $6,224 (1995) 91,186 105,122
Land, buildings and amenities, net 1,222,813 1,254,828
Land held for development 96,949 96,949
Deferred leasing commissions 163,914 166,071
Organizational and start-up costs, net 1,274 1,357
Other assets 68,970 42,258
----------- -----------
$ 1,694,705 $ 1,720,292
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Mortgage and notes payable $ 3,829,569 $ 3,871,374
Accounts payable - operations 217,957 165,270
Accounts payable - construction -- 14,257
Security deposits 12,675 12,030
Other liabilities 29,739 8,287
----------- -----------
4,089,940 4,071,218
Partners' equity (2,395,235) (2,350,926)
----------- -----------
$ 1,694,705 $ 1,720,292
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
Limited General
Partners Partner Total
-------- ------- -----
<S> <C> <C> <C>
PARTNERS' EQUITY
Capital contributions, net of
offering costs $ 11,784,521 $ 100 $ 11,784,621
Net loss - prior years (11,950,641) (120,713) (12,071,354)
Net loss - current year (43,866) (443) (44,309)
Cash distributions to partners
to date (2,038,520) (20,592) (2,059,112)
Purchases of limited partnership
units (5,081) -- (5,081)
------------ ---------- ------------
Balances at March 31, 1996 $ (2,253,587) $ (141,648) $ (2,395,235)
============ ========== ============
</TABLE>
* Reference is made to the audited financial statements in the Form 10-K as
filed with the Commission on March 29, 1996.
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<PAGE>
<TABLE>
NTS-PROPERTIES PLUS LTD.
STATEMENTS OF OPERATIONS
<CAPTION>
Three Months Ended
March 31,
---------
1996 1995
---- ----
<S> <C> <C>
Revenues:
Rental income, net of provision for
doubtful accounts of $-0- (1996)and
$1,291 (1995) $ 204,630 $ 344,495
Interest and other income 289 1,053
--------- ---------
204,919 345,548
Expenses:
Operating expenses 29,616 55,095
Operating expenses - affiliated 12,502 27,847
Amortization of capitalized leasing
costs -- 4,554
Interest expense 93,812 218,150
Management fees 13,262 21,700
Real estate taxes 19,879 39,901
Professional and administrative
expenses 11,033 14,587
Professional and administrative
expenses - affiliated 28,321 27,015
Depreciation and amortization 40,803 176,228
--------- ---------
249,228 585,077
--------- ---------
Net loss $ (44,309) $(239,529)
========= =========
Net loss allocated to the limited
partners $ (43,866) $(237,134)
========= =========
Net loss per limited partnership
unit $ (.06) $ (.35)
========= =========
Weighted average number of limited
partnership units 685,647 685,647
========= =========
</TABLE>
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<PAGE>
<TABLE>
NTS-PROPERTIES PLUS LTD.
STATEMENTS OF CASH FLOWS
<CAPTION>
Three Months Ended
March 31,
---------
1996 1995
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (44,309) $(239,529)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Provision for doubtful accounts -- 1,291
Amortization of capitalized leasing costs -- 4,554
Depreciation and amortization 40,803 176,228
Changes in assets and liabilities:
Cash and equivalents - restricted (21,623) (14,633)
Accounts receivable 13,936 23,252
Deferred leasing commissions 2,157 12,407
Other assets (22,868) (11,108)
Accounts payable - operations 52,687 3,385
Security deposits 645 349
Other liabilities 21,453 (21,082)
--------- ---------
Net cash provided by (used in) operating activities 42,881 (64,886)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to land, buildings, amenities and land
held for development (21,732) (55,087)
Increase in cash and equivalents - restricted -- (14,195)
Decrease in cash and equivalents - restricted 1,725 11,745
--------- ---------
Net cash used in investing activities (20,007) (57,537)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on mortgage and notes
payable (41,805) (41,037)
Capital contribution by a joint venture partner -- 94,275
Additions to loan costs (5,075) (17,420)
--------- ---------
Net cash (used in) provided by financing
activities (46,880) 35,818
--------- ---------
Net decrease in cash and equivalents (24,006) (86,605)
CASH AND EQUIVALENTS, beginning of period 36,269 244,288
--------- ---------
CASH AND EQUIVALENTS, end of period $ 12,263 $ 157,683
========= =========
Interest paid on a cash basis $ 94,276 $ 328,565
========= =========
</TABLE>
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<PAGE>
NTS-PROPERTIES PLUS LTD.
NOTES TO FINANCIAL STATEMENTS
The financial statements and schedules included herein should be read in
conjunction with the Partnership's 1995 Annual Report. In the opinion of the
general partner, all adjustments (only consisting of normal recurring accruals)
necessary for a fair presentation have been made to the accompanying financial
statements for the three months ended March 31, 1996 and 1995.
1. Cash and Equivalents - Restricted
---------------------------------
Cash and equivalents - restricted represents funds escrowed with mortgage
companies for property taxes in accordance with the loan agreements.
Cash and equivalents - restricted at December 31, 1995 also included
escrow funds which were to be released as capital expenditures, leasing
commissions and tenant improvements were incurred at the properties owned
by the Lakeshore/University II Joint Venture. In 1996 the remaining
balance of these escrow funds were released.
2. Mortgage and Notes Payable
--------------------------
Mortgage and notes payable consist of the following:
March 31, December 31,
1996 1995
---- ----
Mortgage payable to an insurance
company, bearing interest at a fixed
rate of 8.5%, due November 15, 2005,
secured by land and building $ 1,707,963 $ 1,736,192
Note payable to a bank bearing interest
at a fixed rate of 10.6%, due January
31, 1998, secured by land and building 1,152,418 1,156,943
Note payable to a bank bearing interest
at a fixed rate of 10.6%, due January
31, 1998, secured by land and building 716,992 721,518
Note payable to a bank bearing interest
at a fixed rate of 10.6%, due January
31, 1998, secured by land 150,589 155,114
Note payable to a bank bearing interest
at a fixed rate of 10.6%, due January
31, 1998, secured by land 58,869 58,869
Note payable to a bank bearing interest
at a fixed rate of 10.6%, due January
31, 1998, secured by land 42,738 42,738
---------- ----------
$ 3,829,569 $ 3,871,374
========== ==========
Based on the borrowing rates currently available to the Partnership for
loans with similar terms and average maturities, the fair value of long
term debt is approximately $4,300,000.
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<PAGE>
3. New Accounting Pronouncement
----------------------------
In March 1995, the Financial Accounting Standards Board issued Statement
No. 121 (the "Statement") on accounting for the impairment of long-lived
assets, certain identifiable intangibles, and goodwill related to assets
to be held and used. The Statement also establishes accounting standards
for long-lived assets and certain identifiable intangibles to be disposed
of. The Partnership adopted the Statement as of January 1, 1996 as
required. No adjustments were required.
4. Related Party Transactions
--------------------------
Property management fees of $13,262 and $21,700 were paid to NTS
Development Company, an affiliate of the general partner of the
Partnership, during the three months ended March 31, 1996 and 1995,
respectively. The fee is equal to 6% of all revenues from commercial
properties pursuant to an agreement with the Partnership. Also permitted
by the partnership agreement, NTS Development Company will receive a
repair and maintenance fee equal to 5.9% of costs incurred which relate to
capital improvements. The Partnership has incurred $373 and $971 as a
repair and maintenance fee during the three months ended March 31, 1996
and 1995, respectively, and has capitalized this cost as part of land,
buildings and amenities.
As permitted by the Partnership agreement, the Partnership was also
charged the following amounts from NTS Development Company for the three
months ended March 31, 1996 and 1995. These charges include items which
have been expensed as operating expenses - affiliated or professional and
administrative expenses - affiliated and items which have been capitalized
as deferred leasing commissions, other assets or as land, buildings and
amenities.
1996 1995
-------- --------
Administrative $ 30,404 $ 30,479
Leasing 6,018 14,696
Property manager 6,919 9,508
Other -- 899
------- -------
$ 43,341 $ 55,582
======= =======
Accounts payable - operations includes approximately $144,000 and $113,000
due NTS Development Company at March 31, 1996 and December 31, 1995,
respectively.
5. Reclassification of 1995 Financial Statements
---------------------------------------------
Certain reclassifications have been made to the March 31, 1995 financial
statements to conform with the March 31, 1996 classifications. These
classifications have no effect on previously reported operations.
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<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
Results of Operations
- ---------------------
The occupancy levels at the Partnership properties as of March 31 were as
follows:
1996 1995
---- ----
Wholly-owned Property
- ---------------------
Lakeshore Business Center Phase II (See See below See below
L/U II Joint Venture below) (1) (1)
Property owned in Joint Venture with
NTS-Properties V (ownership % at
March 31, 1996)
- ------------------------------------
University Business Center Phase II (See
L/U II Joint Venture below) See below See below
(1) (1)
Property owned in Joint Venture with
NTS-Properties IV and NTS-Properties VII,
Ltd.(ownership % at March 31, 1996)
- -----------------------------------
Blankenbaker Business Center 1A (39%) 100% 100%
Properties owned through Lakeshore/University
II Joint Venture (L/U II Joint
Venture)(ownership % at March 31, 1996)
- ---------------------------------------
Lakeshore Business Center Phase I (12%) 97% 79%(2)
Lakeshore Business Center Phase II (12%) 72% 77%
University Business Center Phase II (12%) 100% 100%
(1) During the first quarter of 1995, the Partnership's ownership interest in
the property changed. See below for a discussion regarding the change.
(2) The Partnership obtained an interest in this property during the first
quarter of 1995. See below for a discussion regarding this change.
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<PAGE>
Results of Operations - Continued
- ---------------------------------
The rental and other income generated by the Partnership's properties for the
three months ended March 31, 1996 and 1995 was as follows:
1996 1995
---- ----
Wholly-owned Property
- ---------------------
Lakeshore Business Center Phase II (See
L/U II Joint Venture below) N/A $ 98,182 (1)
Property owned in Joint Venture with NTS-
Properties V (ownership % at March 31,
1996)
- ----------------------------------------
University Business Center II (See L/U II
Joint Venture below) N/A $ 82,123 (1)
Property owned in Joint Venture with NTS-
Properties IV and NTS-Properties VII,
Ltd. (ownership % at March 31, 1996)
- ------------------------------------
Blankenbaker Business Center 1A (39%)
$ 91,503 $ 88,418
Properties owned through Lakeshore/
University II Joint Venture (L/U II Joint
Venture (ownership % at March 31, 1996)
- ---------------------------------------
Lakeshore Business Center Phase I (12%) $ 43,056 $ 23,726
Lakeshore Business Center Phase II (12%) $ 32,989 $ 25,354 (2)
University Business Center Phase II (12%) $ 37,231 $ 27,041
Revenues shown in the table above for properties owned through a joint venture
represent only the Partnership's percentage interest in those revenues.
(1) During the first quarter of 1995, the Partnership's ownership interest in
the property changed. The Partnership's proportionate share of rental and
other income from January 23, 1995 to March 31, 1995 is reflected below
(see L/U II Joint Venture). See below for a discussion regarding this
change.
(2) The Partnership obtained an interest in this property during the first
quarter of 1995. See below for a discussion regarding this change.
A wholly-owned subsidiary of The Prudential Insurance Company of America
(Prudential Service Bureau, Inc.) has leased 100% of Blankenbaker Business
Center 1A through July 2005. In addition to monthly rent payments, Prudential
Service Bureau, Inc. is obligated to pay substantially all of the operating
expenses attributable to its space. The change in rental and other income at
Blankenbaker Business Center 1A for the three months ended March 31, 1996 as
compared to the same period in 1995 was not significant.
- 9 -
<PAGE>
Results of Operations - Continued
- ---------------------------------
The 18% increase in occupancy at Lakeshore Business Center Phase I from March
31, 1995 to March 31, 1996 can be attributed to 10 new leases totalling
approximately 23,500 square feet, which includes approximately 7,600 square feet
in expansions by three current tenants. The new leases and expansions are
partially offset by three tenants, who occupied a total of approximately 4,300
square feet, vacating the premises at the end of the lease terms. Average
occupancy for the three months ended March 31 increased from 79% in 1995 to 98%
in 1996. Rental and other income increased at Lakeshore Business Center Phase I
for the three months ended March 31, 1996 as compared to the 1995 period
primarily as a result of the increase in average occupancy and a decrease in the
provision for doubtful accounts. The increase in rental and other income is also
due to the fact that the Partnership acquired an interest in Lakeshore Business
Center Phase I as a result of the Lakeshore/University II Joint Venture (L/U II
Joint Venture) which was formed in January 1995. (See below for a discussion
regarding the Joint Venture).
The 5% decrease in occupancy at Lakeshore Business Center Phase II from March
31, 1995 to March 31, 1996 can be attributed to four tenant move-outs totalling
approximately 11,000 square feet and a downsizing by a current tenant of its
existing space of approximately 6,000 square feet. Two of the move-outs,
totalling approximately 5,100 square feet, represent tenants who vacated prior
to the end of the lease term but are continuing to pay rent through the end of
the lease term. The third tenant, who occupied approximately 1,400 square feet,
vacated the premises and ceased making rental payments in breach of the lease
terms due to bankruptcy. The write-off of accrued income connected with this
lease was not significant. The fourth tenant, who occupied approximately 4,500
square feet, vacated the premises at the end of the lease term. Partially
offsetting the tenant move-outs are four new leases totalling approximately
8,800 square feet and a 3,600 square foot expansion by a current tenant of its
existing space. Average occupancy at Lakeshore Business Center Phase II
decreased for the three months ended March 31 from 78% (1995) to 72% (1996). In
the opinion of the General Partner of the Partnership, the decrease in occupancy
at Lakeshore Business Center Phase II is only a temporary fluctuation and does
not represent a downward occupancy trend. The decrease in rental and other
income at Lakeshore Business Center Phase II for the three months ended March
31, 1996 as compared to the three months ended March 31, 1995 is due to the
decrease in average occupancy and the Partnership's decreased ownership in
Lakeshore Business Center Phase II. See below for a discussion regarding this
change.
During the first quarter of 1996, a new six-year lease was signed at Lakeshore
Business Center Phase II for approximately 7,000 square feet. The tenant took
occupancy in April 1996 improving the business center's occupancy to 80%.
Philip Crosby Associates, Inc. ("PCA") has leased 100% of University Business
Center Phase II. The lease term is for seven years, and the tenant took
occupancy in April 1991. The tenant has currently sub-leased approximately
52,000 square feet (or 67%) of University Business Center Phase II. Of the total
being sub-leased, approximately 41,000 square feet (or 79%) is being leased by
Full Sail Recorders, Inc. (a major tenant at University Business Center Phase I,
a neighboring property owned by an affiliate of the General Partner of the
Partnership). In December 1995, Full Sail Recorders, Inc. ("Full Sail") signed a
33 month lease with the L/U II Joint Venture for the approximately 41,000 square
feet it currently sub-leases from PCA. The lease term commences April 1998 when
PCA's lease ends. As part of the lease negotiations, Full Sail will receive a
$200,000 tenant finish allowance in 1996, of which approximately $92,000 will be
reimbursed by Full Sail over a 27-month period beginning January 1996. The Joint
Venture has received notice that PCA will not renew its lease when it expires in
April 1998. At this time it is not known whether the other sublesses will sign
renewal leases with the Joint Venture.
- 10 -
<PAGE>
Results of Operations - Continued
- ---------------------------------
The decrease in rental and other income at University Business Center Phase II
for the three months ended March 31, 1996 as compared to the same period in 1995
is the result of a decrease in common area expense reimbursements. The tenant
reimburses the Joint Venture for common area expenses as part of the lease
agreement. The decrease in rental and other income is also due to the
Partnership's decreased ownership of University Business Center Phase II (See
below for a discussion of this change).
In cases of tenants who cease making rental payments or abandon the premises in
breach of their lease, the Partnership pursues collection through the use of
collection agencies and other remedies available by law.
The change in interest and other income for the three months ended March 31,
1996 as compared to the same period in 1995 was not significant.
The decrease in operating expenses and operating expenses - affiliated for the
three months ended March 31, 1996 as compared to the same period in 1995 is
primarily a result of the Partnership's decrease in ownership of certain
properties which were contributed to the L/U II Joint Venture in January 1995.
(See below for further discussion). The decrease in operating expenses -
affiliated can also be attributed to a decrease in leasing salaries at
Blankenbaker Business Center 1A. Operating expenses affiliated are expenses for
services performed by employees of NTS Development Company, an affiliate of the
General Partner of the Partnership.
The decrease in amortization of capitalized leasing costs for the three months
ended March 31, 1996 as compared to the same period in 1995 is due primarily to
costs capitalized during initial lease-up at University Business Center Phase II
becoming fully amortized in 1995.
Interest expense has decreased for the three months ended March 31, 1996 as
compared to the same period in 1995 primarily as a result of the Partnership's
decrease in ownership of certain properties which were contributed to the L/U II
Joint Venture in January 1995. (See below for further discussion regarding the
Joint Venture). Debt totalling approximately $16.7 million was contributed by
the Partnership to the Joint Venture. The decrease in interest expense can also
be attributed to continued principal payments on L/U II Joint Venture's and
Blankenbaker Business Center 1A's debt.
Management fees are calculated as a percentage of cash collections; however,
revenue for reporting purposes is recorded on the accrual basis. As a result,
the fluctuations of revenues between periods will differ from the fluctuations
of management fee expense. The decrease in management fee expense for the three
months ended March 31, 1996 as compared to the same period in 1995 can also be
attributed to the Partnership's decrease in ownership of certain properties
which were contributed to the L/U II Joint Venture in January 1995. (See below
for further discussion of the Joint Venture).
The decrease in real estate taxes for the three months ended March 31, 1996 as
compared to the same period in 1995 is primarily as a result of the
Partnership's decrease in ownership of certain properties which were contributed
to the L/U II Joint Venture in January 1995. (See below for further discussion
of the Joint Venture).
The change in professional and administrative expenses and professional and
administrative expense - affiliated for the three months ended March 31, 1996 as
compared to the same period in 1995 was not significant. Professional and
administrative expenses - affiliated are expenses for services performed by
employees of NTS Development Company, an affiliate of the General Partner.
- 11 -
<PAGE>
Results of Operations - Continued
- ---------------------------------
Depreciation and amortization expense has decreased for the three months ended
March 31, 1996 as compared to the same period in 1995 due to a portion of the
assets of the Partnership's joint venture properties becoming fully depreciated.
The decrease in depreciation and amortization is also a result of the
Partnership's decrease in ownership of certain properties which were contributed
to the L/U II Joint Venture in January 1995. (See below for further discussion
of the Joint Venture). Depreciation is computed using the straight-line method
over the estimated useful lives of the assets which are 5 - 30 year for land
improvements, 30 years for buildings, 5 - 30 years for building improvements and
5 - 30 year for amenities. The aggregate cost of the Partnership's properties
for Federal tax purposes is approximately $6,900,000.
Liquidity and Capital Resources
- -------------------------------
Cash provided by (used in) operations was $42,881 and $(64,886) for the three
months ended March 31, 1996 and 1995, respectively. The Partnership has not made
any cash distributions since the quarter ended June 30, 1991. Distributions will
be resumed once the Partnership has established adequate cash reserves and is
generating cash from operations which, in management's opinion, is sufficient to
warrant future distributions. The primary source of future liquidity and
distributions is expected to be derived from cash generated by the Partnership's
properties after adequate cash reserves are established for future leasing
costs, tenant finish costs and capital improvements. Cash reserves (which are
unrestricted cash and equivalents as shown on the Partnership's balance sheet as
of March 31) were $12,263 and $157,683 as of March 31, 1996 and 1995,
respectively.
As previously disclosed in the Partnership's Form 10-K for the year ended
December 31, 1995, a new joint venture known as Lakeshore/University II Joint
Venture (L/U II Joint Venture) was formed on January 23, 1995 among the
Partnership, NTS-Properties IV, NTS-Properties V and NTS/Fort Lauderdale, Ltd.,
affiliates of the general partner of the Partnership, for purposes of owning
Lakeshore Business Center Phases I and II, University Business Center Phase II
and certain undeveloped tracts of land adjacent to the Lakeshore Business Center
development.
As of March 31, 1996, the L/U II Joint Venture had notes payable to banks in the
following amounts: $9, 168,000, $5,704,000, $1,198,000, $468,333 and $340,000.
The notes are a liability of the joint venture in accordance with the Joint
Venture Agreement. The Partnership's proportionate interest in the notes at
March 31, 1996 was $1,152,418, $716,992, $150,589, $58,869 and $42,738,
respectively. As part of the loan agreements with the banks, the Joint Venture
is required to place in escrow funds for capital expenditures, leasing
commissions and tenant improvements at the properties owned by the Joint
Venture. During the term of the loans, the Joint Venture is required to fund a
total of $200,000 to the escrow account. The Joint Venture met this funding
requirement during 1995. As of March 31, 1996, all funds in the escrow account
had been released. The notes bear interest at a fixed rate of 10.6%, are due
January 31, 1998 and are secured by the assets of the joint venture. Principal
payments required on the $9,168,000, $5,704,000 and $1,198,000 notes are as
follows.
a) 12 monthly payments of $3,000 each , the first of which was due at
closing. The second through 12th payments are due on the first
day of February through December 1995.
b) 12 monthly payments of $12,000 each, commencing on January 1, 1996
through December 1, 1996.
c) 13 monthly payments of $15,000 each, commencing on January 1, 1997
through January 1, 1998.
d) Balloon payment due at maturity on January 31, 1998.
- 12 -
<PAGE>
Liquidity and Capital Resources - Continued
- -------------------------------------------
The debt refinancing was concluded in conjunction with the formation of the
Lakeshore/University II Joint Venture. For a discussion regarding the new joint
venture, see above.
As of March 31, 1996, the L/U II Joint Venture has obtained a commitment from an
insurance company for $17.4 million of debt financing. The mortgage will mature
144 months from the closing date and will bear interest at a fixed rate of
8.125%. The repayment of principal will be amortized over 144 months, with
monthly payments of principal and interest in the amount of $189,541. The
proceeds from the loan will be used to pay off the Joint Venture's current debt
financings of approximately $16.9 million. The remaining proceeds will be used
to fund Joint Venture tenant finish improvements, leasing costs and loan closing
costs. The closing date of the permanent financing is expected to take place
before June 30, 1996.
As of March 31, 1996, the Blankenbaker Business Center Joint Venture had a
mortgage payable with an insurance company (obtained November 1994) in the
amount of $4,427,069. The mortgage is recorded as a liability of the Joint
Venture and is secured by the assets of the Joint Venture. The Partnership's
proportionate interest in the mortgage at March 31, 1996 is $1,707,963. The
mortgage bears interest at a fixed rate of 8.5% and is due November 15, 2005.
Monthly principal payments are based upon an 11-year amortization schedule. At
maturity, the mortgage will have been repaid based on the current rate of
amortization.
The majority of the Partnership's 1996 cash flow was derived from operating
activities. The majority of the Partnership's 1995 cash flows was derived from
the use of cash reserves. Cash flows used in investing activities include tenant
finish improvements. Changes to current tenant finish improvements are a typical
part of any lease negotiation. Improvements generally include a revision to the
current floor plan to accommodate a tenant's needs, new carpeting and paint
and/or wallcovering. The extent and cost of these improvements are determined by
the size of the space and whether the improvements are for a new tenant or
incurred because of a lease renewal. Cash flows used in investing activities in
1995 also include cash which is being escrowed for capital expenditures, leasing
commissions and tenant improvements at the properties owned by the L/U II Joint
Venture. Cash flows provided by investing activities in 1996 were the result of
a release of these escrow funds. Cash flows provided by investing activities in
1995 were the result of a release from the funds escrowed for tenant finish
improvements at Lakeshore Business Center Phase II as required by a July 1993
loan extension agreement. Cash flows used in investing activities were funded by
cash flow from operating activities and capital contributions (as discussed
above). Cash flows used in financing activities are for loan costs and principal
payments on mortgage and notes payable. The capital contribution by a joint
venture partner represents the Partnership's interest in the L/U II Joint
Venture's increase in cash which resulted from a capital contribution. The
Partnership utilizes the proportionate consolidation method of accounting for
joint venture properties. The Partnership's interest in the joint venture's
assets, liabilities, revenues, expenses and cash flows are combined on a
line-by-line basis with the Partnership's own assets, liabilities, revenues,
expenses and cash flows. The Partnership does not expect any material change in
the mix and relative cost of capital resources except that which is discussed in
the following paragraph.
In the next 12 months, the demand on future liquidity will increase as a result
of the L/U II Joint Venture debt financings (see above). The Partnership also
expects the demand on future liquidity to increase as a result of future leasing
activity at Lakeshore Business Center Phases I and II. At this time, the future
leasing and tenant finish costs which will be required to renew the current
leases or obtain new tenants are unknown. It is anticipated that the cash flow
from operations and cash reserves will be sufficient to meet the needs of the
Partnership.
- 13 -
<PAGE>
Liquidity and Capital Resources - Continued
- -------------------------------------------
Due to the fact that no distributions were made during the three months ended
March 31, 1996 or 1995, the table which presents that portion of the
distribution that represents a return of capital on a Generally Accepted
Accounting Principle basis has been omitted.
At March 31, 1996, none of the Partnership's properties were in the construction
stage.
Currently, the Partnership's plans for renovations and other major capital
expenditures include tenant improvements at the Partnership's properties as
required by lease negotiations. Changes to current tenant finish improvements
are a typical part of any lease negotiation. Improvements generally include a
revision to the current floor plan to accommodate a tenant's needs, new
carpeting and paint and/or wallcovering. The extent and cost of the improvements
are determined by the size of the space being leased and whether the
improvements are for a new tenant or incurred because of a lease renewal. The
tenant finish improvements will be funded by cash flow from operations and cash
reserves.
As of March 31, 1996 , the L/U II Joint Venture had a commitment for an
approximately $105,000 special tenant finish allowance as a result of a new
six-year lease for approximately 7,000 square feet at Lakeshore Business Center
Phase II. The Partnership's proportionate share of this commitment is
approximately $13,000 or 12%.
As of March 31, 1996, the L/U II Joint Venture also had a commitment for a
$200,000 special tenant finish allowance, of which approximately $92,000 will be
reimbursed by the tenant over a 27-month period beginning in January 1996. This
commitment is the result of lease negotiations with Full Sail Recorders, Inc.
("Full Sail") which currently sub-leases approximately 41,000 square feet from
Philip Crosby Associates, Inc. ("PCA") at University Business Center Phase II.
PCA currently leases 100% of the business center through April 1998. Full Sail's
lease term with the Joint Venture is for 33 months (April 1998 to December
2000). The Partnership's proportionate share of net commitment ($200,000 less
$92,000) is approximately $13,000 or 12%.
The Partnership had no other material commitments for renovations or capital
improvements at March 31, 1996.
The L/U II Joint Venture owns approximately 6 acres of land adjacent to the
Lakeshore Business Center development in Ft. Lauderdale, Florida. The
Partnership's proportionate interest at March 31, 1996 in the land held for
development is approximately $97,000. The Joint Venture currently has a contract
for the sale of .7 acres of this land for $175,000.
Historically, extremely weak economic conditions in Ft. Lauderdale, Florida have
caused the low occupancy levels at Lakeshore Business Center Phases I and II. In
the opinion of the general partner, leasing activity is improving in this part
of Florida. In an effort to continue to improve the occupancy at Lakeshore
Business Center Phases I and II, the Partnership has an on-site leasing agent,
an employee of NTS Development Company (an affiliate of the general partner),
who makes calls to potential tenants, negotiates lease renewals with current
tenants and manages local advertising with the assistance of NTS Development
Company's marketing staff. The leasing and renewal negotiations of University
Business Center Phase II are handled by a leasing agent, an employee of NTS
Development Company, located at the University Business Center development.
Leases at the Partnership's properties provide for tenants to contribute toward
the payment of common area expenses, insurance and real estate taxes. Leases at
the Partnership's properties also provide for rent increases which are based
upon increases in the consumer price index. These lease provisions should
protect the Partnership's operations from the impact of inflation and changing
prices.
- 14 -
<PAGE>
PART II. OTHER INFORMATION
l. Legal Proceedings
None
2. Changes in Securities
None
3. Defaults upon Senior Securities
None
4. Submission of Matters to a Vote of Security Holders
None
5. Other Information
None
6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit 27. Financial Data Schedule
(b) Reports on Form 8-K:
There were no Form 8-K reports filed for the three months ended
March 31, 1996.
- 15 -
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities exchange
Act of 1934, NTS-Properties Plus Ltd. has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
NTS-PROPERTIES PLUS LTD.
(Registrant)
BY: NTS-Properties Plus
Associates,
BY: NTS Capital Corporation,
General Partner
/s/ John W. Hampton
John W. Hampton
Senior Vice President
Date: May 14 , 1996
- 16 -
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
BALANCE SHEET AS OF MARCH 31, 1996 AND FROM THE STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 49,599
<SECURITIES> 0
<RECEIVABLES> 91,186
<ALLOWANCES> 4,986
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 1,222,813
<DEPRECIATION> 0<F2>
<TOTAL-ASSETS> 1,694,705
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 3,829,569
0
0
<COMMON> 0
<OTHER-SE> (2,395,235)
<TOTAL-LIABILITY-AND-EQUITY> 1,694,705
<SALES> 204,630
<TOTAL-REVENUES> 204,919
<CGS> 0
<TOTAL-COSTS> 116,062
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 93,812
<INCOME-PRETAX> (44,309)
<INCOME-TAX> 0
<INCOME-CONTINUING> (44,309)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (44,309)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>THE PARTNERSHIP HAS AN UNCLASSIFIED BALANCE SHEET; THEREFORE; THE VALUE
IS $0.
<F2>THIS INFORMATION IS NOT DISCLOSED IN THE PARTNERSHIP'S FORM 10-Q FILING.
</FN>
</TABLE>
