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FORM 10-Q--QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the period ended September 30, 1998
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the transition period from __________ to _______________
Commission File Number: 33-18089-A
HICKORY LENDERS, LTD.
(Exact name of Registrant as specified in its charter)
Tennessee 62-1336905
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification)
4400 Harding Road, Suite 500, Nashville, Tennessee 37205
(Address of principal executive office) (Zip Code)
(615) 292-1040
(Registrant's telephone number, including area code)
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 ___
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PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
HICKORY LENDERS, LTD.
(A Tennessee Limited Partnership)
FINANCIAL STATEMENTS
For The Three and Nine Months Ended September 30,
1998 and 1997
INDEX
Financial Statements:
Balance Sheets 3
Statements of Operations 4
Statements of Cash Flows 5
Notes to Financial Statements 6
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<TABLE>
HICKORY LENDERS, LTD.
(A Limited Partnership)
BALANCE SHEETS
(Unaudited)
<CAPTION>
September 30, 1998 December 31, 1997
------------- -------------
<S> <C> <C>
ASSETS
CASH $ 47,262 $ 322,741
NOTE RECEIVABLE FROM AFFILIATE 1,458,601 1,833,601
Total Assets $ 1,505,863 $ 2,156,342
========== ==========
PARTNERS' EQUITY
PARTNERS' EQUITY:
Limited partners (4,200
units outstanding) $ 1,505,863 $ 2,156,342
General partner - -
Total partners' equity $ 1,505,863 $ 2,156,342
========== ==========
<FN>
See notes to financial statements.
</TABLE>
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<TABLE>
HICKORY LENDERS, LTD.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Quarter Ending Year to Date Ending
SEPTEMBER 30,
_________________
1998 1997 1998 1997
____ ____ ____ ____
<S> <C> <C> <C> <C>
REVENUE:
Interest $ - $ - $ 2,880 $ 5,269
EXPENSES:
State Income Tax - - - 2,968
Legal &
Accounting Fees 400 - 11,872 11,172
General &
Admin. Expenses - - - 889
Mortgage
Servicing Fee 1,750 1,750 5,250 5,250
Amortization - 4,480 - 13,440
Total Expenses 2,150 6,230 17,122 33,719
NET LOSS $(2,150) $(6,230) $(14,242) $(28,450)
<FN>
See notes to financial statements
</TABLE>
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<TABLE>
HICKORY LENDERS, LTD.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Year-to-date
SEPTEMBER 30,
__________________________
1998 1997
____ ____
<S> <C> <C>
Cash Flows from Operating Activities:
Net Loss $(14,242) $(28,450)
Adjustments to reconcile Net
Loss to Net Cash used in
Operating Activities:
Amortization - 13,440
Net Cash used in
Operating Activities (14,242) (15,010)
Cash Flows from Financing Activities:
Distribution to Partners (636,237) (678,788)
Payments Received on Notes
Receivable applied to Principal 375,000 345,000
Net Cash used in Financing
Activities (261,237) (333,788)
Net Decrease in Cash (275,479) (348,798)
CASH AT JANUARY 1, 322,741 374,088
CASH AT SEPTEMBER 30, $ 47,262 $ 25,290
========= ========
<FN>
See notes to financial statements.
</TABLE>
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HICKORY LENDERS, LTD.
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 1998 and 1997
(Unaudited)
A.ACCOUNTING POLICIES
The unaudited financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q and do
not include all of the information and note disclosures required by
generally accepted accounting principles. These statements should
be read in conjunction with the financial statements and notes
thereto included in the Partnership's Form 10-K for the year ended
December 31, 1997. In the opinion of management, such financial
statements include all adjustments, consisting only of normal
recurring adjustments, necessary to summarize fairly the
Partnership's financial position and results of operations.
The results of operations for the nine month period ended
September 30, 1998 may not be indicative of the results that may be
expected for the year ending December 31, 1998.
B.RELATED PARTY TRANSACTIONS
The General Partner and its affiliates have been actively
involved in managing the Partnership's operations. Compensation
earned for these services in the first nine months were as follows:
1998 1997
Mortgage Servicing Fee $ 5,250 $ 5,250
Accounting Fees $ 2,100 $ 2,100
C. COMPREHENSIVE INCOME
Effective January 1, 1998, the Partnership adopted Statement of
Financial Accounting Standards (SFAS) No. 130. Reporting
Comprehensive Income. SFAS 130 establishes standards for reporting
and display of comprehensive income and its components in a full
set of general-purpose financial statements and required 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 three and nine month periods
ended September 1998 and 1997, the Partnership had no components of
comprehensive income. Accordingly, comprehensive income for each
of the periods was the same as net loss.
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Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The Partnership's primary business is to lend monies to Hickory
Hills, Ltd. Due to the nature of the Registrant, all activity is a
result of transactions in Hickory Hills, Ltd., the loan holder.
The Registrant continues its policy begun in 1991 of not
recognizing interest income for financial reporting purposes on the
Lender Financing. This policy was accepted upon the recommendation
of the Registrant's principal accountants because there had not
been any payments made on the Lender Financing since inception and
there has been no independent verification of the value of the
land held as collateral. Interest income will be recognized for
tax and loan payment purposes.
The Note receivable to Affiliate comes due on December 31, 1998.
The General Partner plans to negotiate an extension of the loan
term. The General Partner does not expect the Borrower to have the
liquidity to retire the debt in full on December 31, 1998. Because
the Borrower and the Registrant share the same general partner, it
may be necessary to appoint an independent party to represent the
general partner for the Registrant, the Borrower or both during the
loan negotiations. However, if the loan term is not extended, the
lack of payment would constitute a default on the loan agreement.
In such an event the Registrant is required to foreclose the loan.
Currently, the Partnership has not foreclosed or accelerated the
amounts due under the loan agreement.
Overall operations of the Registrant have not fluctuated
significantly from previous quarters.
During 1998, the Borrower sold one lakefront lot at the
Hendersonville Property for $75,000 and 71.53 acres of the
Nashville Property for gross proceeds of $357,650. From these
sales proceeds, $375,000 in accrued interest was paid to the
Registrant. Such payments have been applied to the note receivable
principal balance.
The General Partner has evaluated the impact of year 2000 issues on
our computer systems and applications. The Registrant is affected
by a single personal computer and a commercial software package.
Both are Y2K compliant.
LIQUIDITY
At October 31, 1998 the Registrant had approximately $45,511 in
cash reserves. Due to the minimal expenses of the Registrant,
these funds are expected to be sufficient through 1998. <PAGE>
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PART II. OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
(b) No 8-K's have been filed during this quarter.
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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, thereunto duly authorized.
HICKORY LENDERS, LTD.
By: 222 HICKORY, LTD.
General Partner
By: 222 PARTNERS, INC.
General Partner
Date: November 16, 1998 By:/s/ Steven D. Ezell
President
Date: November 16, 1998 By:/s/ Michael A. Hartley
Secretary/Treasurer
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1998
<CASH> 47,262
<SECURITIES> 0
<RECEIVABLES> 1,458,601
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,505,863
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,505,863
<TOTAL-LIABILITY-AND-EQUITY> 1,505,863
<SALES> 0
<TOTAL-REVENUES> 2,880
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 17,122
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (14,242)
<INCOME-TAX> 0
<INCOME-CONTINUING> (14,242)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (14,242)
<EPS-PRIMARY> 3.39
<EPS-DILUTED> 3.39
</TABLE>
