<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended June 30, 1996
-----------------------------
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
----------- -----------
Commission file number 0-16642
---------------------------------
WINDSOR PARK PROPERTIES 5, A CALIFORNIA LIMITED PARTNERSHIP
------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
California 33-0243223
- ---------------------------------- ---------------------------------
(State or other jurisdiction
of incorporation or organization) (IRS Employer Identification No.)
120 W. Grand Avenue, Suite 202, Escondido, California 92025
------------------------------------------------------------------------
(Address of principal executive offices)
(619) 746-2411
------------------------------------------------------------------------
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 ( )
--- ---
1
<PAGE>
TABLE OF CONTENTS
PART I
------
<TABLE>
<CAPTION>
Page
----
<S> <C>
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II
-------
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURE
</TABLE>
2
<PAGE>
WINDSOR PARK PROPERTIES 5
-------------------------
(A California Limited Partnership)
BALANCE SHEET
-------------
(unaudited)
<TABLE>
<CAPTION>
June 30, 1996
-------------
<S> <C>
ASSETS
- ------
Property held for investment:
Land $ 1,507,800
Buildings and improvements 2,042,200
Fixtures and equipment 28,200
------------
3,578,200
Less accumulated depreciation (802,200)
------------
2,776,000
Investments in joint ventures 2,174,200
Cash and cash equivalents 572,600
Deferred financing costs 56,100
Other assets 66,800
------------
$ 5,645,700
============
LIABILITIES AND PARTNERS' EQUITY
- --------------------------------
Liabilities:
Mortgage note payable $ 1,097,000
Accounts payable 4,100
Accrued expenses 37,000
Tenant deposits and other liabilities 33,800
------------
1,171,900
------------
Partners' equity:
Limited partners 4,646,300
General partners (172,500)
------------
4,473,800
------------
$ 5,645,700
============
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
WINDSOR PARK PROPERTIES 5
-------------------------
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
------------------------
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended June 30,
-----------------------------
1996 1995
--------------- -----------
<S> <C> <C>
REVENUES
- --------
Rent and utilities $ 107,100 $ 106,700
Equity in earnings of joint ventures 22,700 15,600
Interest 8,400 5,300
Other 3,100 3,100
--------------- -----------
141,300 130,700
--------------- -----------
COSTS AND EXPENSES
- ------------------
Property operating 66,900 55,900
Depreciation and amortization 26,600 25,900
Interest 25,400
General and administrative:
Related parties 11,800 11,000
Other 12,700 7,900
--------------- -----------
143,400 100,700
--------------- -----------
Net (loss) income $ (2,100) $ 30,000
=============== ===========
Net income - general partners $ -- $ 300
=============== ===========
Net (loss) income - limited partners $ (2,100) $ 29,700
=============== ===========
Net (loss) income per limited partnership unit $ (0.01) $ 0.12
=============== ===========
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
WINDSOR PARK PROPERTIES 5
-------------------------
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
------------------------
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
-----------------------------
1996 1995
-------------- -----------
<S> <C> <C>
REVENUES
- --------
Rent and utilities $ 211,100 $ 212,400
Equity in earnings of joint ventures 46,400 29,200
Interest 17,700 10,400
Other 6,100 5,400
-------------- -----------
281,300 257,400
-------------- -----------
COSTS AND EXPENSES
- ------------------
Property operating 137,600 106,400
Depreciation and amortization 53,200 51,700
Interest 50,700
General and administrative:
Related parties 24,300 24,400
Other 23,700 19,500
-------------- -----------
289,500 202,000
-------------- -----------
Net (loss) income $ (8,200) $ 55,400
============== ===========
Net (loss) income - general partners $ (100) $ 600
============== ===========
Net (loss) income - limited partners $ (8,100) $ 54,800
============== ===========
Net (loss) income per limited partnership unit $ (0.03) $ 0.22
============== ===========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
WINDSOR PARK PROPERTIES 5
-------------------------
(A California Limited Partnership)
STATEMENTS OF CASH FLOWS
------------------------
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------------
1996 1995
--------------- ------------
<S> <C> <C>
Cash flows from operating activities:
Net (loss) income $ (8,200) $ 55,400
Adjustments to reconcile net (loss) income to net
cash provided by operating activities:
Depreciation and amortization 53,200 51,700
Equity in earnings of joint ventures (46,400) (29,200)
Joint ventures' cash distributions 46,400 29,200
Amortization of deferred financing costs 4,600
Changes in operating assets and liabilities:
Other assets (600) (10,400)
Accounts payable (5,400) (3,400)
Accrued expenses 4,800 14,100
Tenant deposits and other liabilities (1,200) (5,700)
--------------- ------------
Net cash provided by operating activities 47,200 101,700
--------------- ------------
Cash flows from investing activities:
Joint ventures' cash distributions 13,300 6,900
Increase in property held for investment (2,300) (11,700)
Deposit on property (50,000)
--------------- ------------
Net cash provided by (used in) investing activities 11,000 (54,800)
--------------- ------------
Cash flows from financing activities:
Cash distributions (101,000) (101,000)
Repurchase of limited partnership units (2,400) (2,500)
--------------- ------------
Net cash used in financing activities (103,400) (103,500)
--------------- ------------
Net decrease in cash and cash equivalents (45,200) (56,600)
Cash and cash equivalents at beginning of period 617,800 170,500
--------------- ------------
Cash and cash equivalents at end of period $ 572,600 $ 113,900
=============== ============
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest (none capitalized) $ 46,600 $ --
=============== ============
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
WINDSOR PARK PROPERTIES 5
-------------------------
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE 1. BASIS OF PRESENTATION
---------------------
The balance sheet at June 30, 1996 and the related statements of operations for
the three and six months ended June 30, 1996 and 1995 and the statements of cash
flows for the six months ended June 30, 1996 and 1995 are unaudited. However, in
the opinion of the General Partners, they contain all adjustments, of a normal
recurring nature, necessary for a fair presentation of such financial
statements. Interim results are not necessarily indicative of results for a
full year.
The financial statements and notes are presented as permitted by Form 10-QSB and
do not contain certain information included in the Partnership's annual
financial statements and notes.
NOTE 2. INVESTMENTS IN JOINT VENTURES
-----------------------------
The Partnership's investments in joint ventures consist of interests in three
manufactured home communities in 1996 and one manufactured home community in
1995. The combined condensed results of operations of the joint ventures for
the six months ended June 30, 1996 and 1995 follows:
<TABLE>
<CAPTION>
1996 1995
------------- -----------
<S> <C> <C>
Property revenues $ 1,147,500 $ 289,000
------------- -----------
Expenses:
Property operating 493,600 163,000
Interest 314,900
Depreciation 187,000 56,500
------------- -----------
995,500 219,500
------------- -----------
Net income $ 152,000 $ 69,500
============= ===========
</TABLE>
NOTE 3. NET (LOSS) INCOME PER LIMITED PARTNERSHIP UNIT
----------------------------------------------
Net (loss) income per limited partnership unit is calculated based on the
weighted average number of limited partnership units outstanding during the
period and the net (loss) income allocated to the Limited Partners. The
weighted average number of limited partnership units outstanding during the
three and six months ended June 30, 1996 was 241,525 and 241,646, respectively;
and 243,597 and 243,694 for the three and six months ended June 30, 1995,
respectively.
NOTE 4. RELATED PARTY TRANSACTIONS
--------------------------
The General Partners of the Partnership are The Windsor Corporation, a
California corporation, and John A. Coseo, Jr. (Mr. Coseo is also the
president, chief executive officer and the principal stockholder of The Windsor
Corporation).
7
<PAGE>
The General Partners are entitled to receive various fees and compensation from
the Partnership which are summarized as follows:
Operational Stage
- -----------------
The net profits, losses and cash distributions of the Partnership during the
operational stage are allocated 99% to the Limited Partners and 1% to the
General Partners.
The Partnership reimburses The Windsor Corporation for certain direct expenses,
and employee, executive and administrative time, which are incurred on the
Partnership's behalf. The Partnership was charged $13,900 and $12,600 for such
costs during the three months ended June 30, 1996 and 1995, respectively; and
$28,100 and $27,500 for the six months ended June 30, 1996 and 1995,
respectively. These costs are included in property operating and general and
administrative expenses in the accompanying Statements of Operations.
Liquidation Stage
- -----------------
During the Partnership's liquidation stage, the total compensation paid to all
persons for the sale of investment properties is limited to competitive real
estate commissions, not to exceed 6% of the contract price for the sale of the
property. The General Partners may receive up to one-half of the competitive
real estate commission, not to exceed 3%, if they provide a substantial amount
of services in the sales effort. The General Partners' commission is
subordinated to the Limited Partners receiving a 9% cumulative, non-compounded
annual return (Preferred Return) on their original capital investments. No
commissions were paid to the General Partners during the three and six months
ended June 30, 1996 and 1995.
The General Partners also receive 1% of profits, losses and cash distributions
from the sale or financing of Partnership properties. The participation
increases to 15% after the Limited Partners have received their original
invested capital plus their Preferred Return.
During the three months ended June 30, 1995, the General Partners received cash
distributions of $500; and $1,000 for both the six months ended June 30, 1996
and 1995. The General Partners received no cash distributions during the three
months ended June 30, 1996.
NOTE 5. DISTRIBUTIONS TO LIMITED PARTNERS
---------------------------------
Distributions to limited partners in excess of net income allocated to limited
partners are considered a return of capital. A breakdown of cash distributions
to limited partners for the six months ended June 30, 1996 and 1995 follows:
<TABLE>
<CAPTION>
1996 1995
---------------------- ----------------------
Per Per
Amount Unit Amount Unit
----------- -------- ----------- --------
<S> <C> <C> <C> <C>
Net income
- limited partners $ $ $ 54,800 $ 0.22
Return of capital 100,000 0.41 45,200 0.19
----------- -------- ----------- --------
$ 100,000 $ 0.41 $ 100,000 $ 0.41
=========== ======== =========== ========
</TABLE>
8
<PAGE>
WINDSOR PARK PROPERTIES 5
-------------------------
(A California Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
Changes in Financial Condition
- ------------------------------
June 30, 1996 as compared to December 31, 1995
- ----------------------------------------------
The Partnership's primary source of cash during the six months ended June 30,
1996 was from the operations of its investment properties. The primary use of
cash during the same period was for cash distributions to partners.
There have been no significant changes in the financial condition of the
Partnership since December 31, 1995. Partners' equity decreased from $4,585,400
at December 31, 1995 to $4,473,800 at June 30, 1996 due to cash distributions of
$101,000, repurchased limited partnership units of $2,400 and a net loss of
$8,200.
At June 30, 1996, the Partnership's total mortgage debt, including its
proportionate share of joint venture debt, was $3,138,200 consisting entirely of
variable rate debt. The average rate of interest on the variable rate debt was
8.7% at June 30, 1996.
The future sources of cash for the Partnership will be provided from property
operations, cash reserves, and ultimately from the sale of property. The future
uses of cash will be for Partnership administration, capital expenditures,
distributions to partners and debt service. The General Partners believe that
the future sources of cash are sufficient to meet the working capital
requirements of the Partnership for the foreseeable future.
Results of Operations
- ---------------------
Six months ended June 30, 1996 as compared to six months ended June 30, 1995
- ----------------------------------------------------------------------------
The results of operations for the six months ended June 30, 1996 and 1995 are
not directly comparable due to the purchases of interests in the Rancho Margate
and Winter Haven manufactured home communities in September 1995 and October
1995, respectively. The Partnership incurred a net loss of $8,200 ($0.03 per
limited partnership unit) for the six months ended June 30, 1996 and realized
net income of $55,400 ($0.22 per limited partnership unit) for the six months
ended June 30, 1995.
Rent and utilities revenues decreased slightly from $212,400 in 1995 to $211,100
in 1996. The average overall occupancy of the Partnership's two wholly-owned
properties was approximately 76% for both the six months ended June 30, 1996 and
1995.
Equity in earnings of joint ventures represents the Partnership's share of the
net income of three manufactured home communities in 1996 and one manufactured
home community in 1995, (as mentioned previously, two joint venture interests
were acquired in September and October 1995). Equity in earnings of joint
ventures increased from $29,200 in 1995 to $46,400 in 1996 due mainly to the
purchase of two additional joint venture interests. The overall occupancy of
the Partnership's three joint venture properties was 97% at June 30, 1996,
compared to 100% for one joint venture property at June 30, 1995. Recent rent
increases implemented include $8 and $12 per month at Town and Country effective
May 1996 and May 1995, respectively, and $10 and $13 per month at Winter Haven
and Rancho Margate, respectively, effective January 1996.
9
<PAGE>
Interest income increased from $10,400 in 1995 to $17,700 in 1996 due mainly to
higher cash balances maintained by the Partnership.
Property operating expenses increased from $106,400 in 1995 to $137,600 in 1996.
The increase is attributable mainly to higher utilities and promotional costs.
The Partnership is currently offering financial incentives to prospective
residents in an effort to improve occupancy at both the Lakeside and Plantation
communities.
Interest expense of $50,700 in 1996 represents interest incurred on the
$1,097,000 loan obtained by the Partnership in September 1995. No interest
expense was incurred by the Partnership in 1995.
General and administrative expense increased from $43,900 in 1995 to $48,000 in
1996. The increase is due mainly to a $5,500 state tax refund received in 1995,
which reduced the 1995 amounts.
Three months ended June 30, 1996 as compared to three months ended June 30, 1995
- --------------------------------------------------------------------------------
The results of operations for the three months ended June 30, 1996 and 1995 are
not directly comparable due to the purchases of interests in the Rancho Margate
and Winter Haven manufactured home communities in September 1995 and October
1995, respectively, as discussed previously. The Partnership incurred a net
loss of $2,100 ($0.01 per limited partnership unit) for the three months ended
June 30, 1996 and realized net income of $30,000 ($0.12 per limited partnership
unit) for the three months ended June 30, 1995.
Equity in earnings of joint ventures represents the Partnership's share of the
net income of three manufactured home communities in 1996 and one manufactured
home community in 1995, (as mentioned previously, two joint venture interests
were acquired in September and October 1995). Equity in earnings of joint
ventures increased from $15,600 in 1995 to $22,700 in 1996 due mainly to the
purchase of the two additional joint venture interests.
Interest income increased from $5,300 in 1995 to $8,400 in 1996 due mainly to
higher cash balances maintained by the Partnership.
Property operating expenses increased from $55,900 in 1995 to $66,900 in 1996.
The increase is attributable mainly to higher utilities and promotional costs.
As discussed previously, the Partnership is currently offering financial
incentives to prospective residents in an effort to improve occupancy at both
the Lakeside and Plantation communities.
Interest expense of $25,400 in 1996 represents interest incurred on the
$1,097,000 loan obtained by the Partnership in September 1995. No interest
expense was incurred by the Partnership in 1995.
General and administrative expense increased from $18,900 in 1995 to $24,500 in
1996. The increase is due mainly to a $5,500 state tax refund received in 1995,
which reduced the 1995 amounts.
10
<PAGE>
PART II
-------
<TABLE>
<CAPTION>
<C> <S>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
(a) Exhibits and Index of Exhibits
(27) Financial Data Schedule
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the period covered by
this Form 10-QSB.
</TABLE>
11
<PAGE>
SIGNATURE
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
WINDSOR PARK PROPERTIES 5,
A California Limited Partnership
---------------------------------
(Registrant)
By: The Windsor Corporation, a California corporation
By /s/John A. Coseo, Jr.
---------------------------------------------------
JOHN A. COSEO, JR.
Chief Financial Officer
(Principal Accounting Officer)
Date: August 12, 1996
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET OF WINDSOR PARK PROPERTIES 5 AS OF JUNE 30, 1996 AND THE RELATED
STATEMENTS OF OPERATIONS AND OF CASH FLOWS FOR THE SIX MONTHS THEN ENDED AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 572,600
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 3,578,200
<DEPRECIATION> 802,200
<TOTAL-ASSETS> 5,645,700
<CURRENT-LIABILITIES> 0
<BONDS> 1,097,000
0
0
<COMMON> 0
<OTHER-SE> 4,473,800<F1>
<TOTAL-LIABILITY-AND-EQUITY> 5,645,700
<SALES> 0
<TOTAL-REVENUES> 281,300
<CGS> 0
<TOTAL-COSTS> 137,600
<OTHER-EXPENSES> 101,200
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 50,700
<INCOME-PRETAX> (8,200)
<INCOME-TAX> 0
<INCOME-CONTINUING> (8,200)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (8,200)
<EPS-PRIMARY> (0.03)<F2>
<EPS-DILUTED> 0
<FN>
<F1> Limited and general partners equity.
<F2> Net loss per limited partnership unit.
</FN>
</TABLE>
