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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 June 30, 1999
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 Six Months Ended June 30, 1999 and 1998
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>
June 30, 1999 December 31, 1998
------------- -------------
<S> <C> <C>
ASSETS
CASH $ 235,689 $ 192,414
LAND & IMPROVEMENTS HELD
FOR INVESTMENT 1,308,601 1,308,601
Total Assets $1,544,290 $ 1,501,015
========= ==========
LIABILITIES & PARTNERS' EQUITY
Accounts Payable $ 59,000 -
PARTNERS' EQUITY:
Limited partners (4,200
units outstanding) $1,485,290 $ 1,501,015
General partner - -
Total partners' equity $1,544,290 $ 1,501,015
========== ==========
<FN>
See accompanying notes to financial statements.
</TABLE>
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<TABLE>
HICKORY LENDERS, LTD.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30,
----------------------------------
1999 1998 1999 1998
<S> <C> <C> <C> <C>
REVENUE:
Interest Income $ - - 2,880
EXPENSES:
Legal & Accounting Fees 9,953 4,572 12,225 11,472
Property Management Fee 1,750 - 3,500 -
Mortgage Servicing Fee - 1,750 - 3,500
Total Expenses 11,703 6,322 15,725 14,972
NET LOSS $ (11,703) (6,322) (15,725) (12,092)
Net Loss per limited
partner unit $ (2.79) (1.50) (3.74) (2.88)
<FN>
See accompanying notes to financial statements
</TABLE>
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<TABLE>
HICKORY LENDERS, LTD.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
--------------------------
1999 1998
<S> <C> <C>
Cash Flows from Operating Activities:
Net Loss $(15,725) $ (12,092)
Adjustments to reconcile Net
Loss to Net Cash provided by (used in)
Operating Activities:
Increase in Accounts Payable 59,000 -
Net Cash provided by (used in)
Operating Activities 43,275 (12,092)
Cash Flows from Financing Activities:
Distribution to Partners - (636,237)
Principal payments received - 375,000
Net Cash used in Financing Activities: - (261,237)
Net increase (Decrease) in Cash 43,275 (273,329)
CASH AT JANUARY 1, 192,414 322,741
CASH AT JUNE 30, $ 235,689 $ 49,412
========= ========
<FN>
See accompanying notes to financial statements.
</TABLE>
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HICKORY LENDERS, LTD.
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For the Three and Six Months Ended June 30, 1999 and 1998
(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, 1998. In the opinion of management, such
financial statements include all adjustments, consisting only
of normal recurring adjustments, necessary tosummarize
fairly the Partnership's financial position and results of
operations. The results of operations for the six month
period ended June 30, 1999 may not be indicative of the
results that may be expected for the year ending December
31, 1999.
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 six months
were as follows:
<TABLE>
<CAPTION>
1999 1998
-------- -------
<S> <C> <C>
Management Fees $ 3,500 $ 3,500
Accounting Fees 1,800 -
C. COMPREHENSIVE INCOME
During the three and six month periods ended June 30, 1999
and 1998, the Partnership had no components of other
comprehensive income. Accordingly, comprehensive income for
each of the periods was the same as net loss.
D. FORECLOSURE
On December 31, 1998, the Partnership began the process of
foreclosing on the debt to Hickory Hills, Ltd. after the note
matured and payment was not made. The Financial Statements
included herein, as of December 31, 1998 reflect the transfer
of property and excess cash to the Lender. Foreclosure
proceeding were completed on June 29, 1999.
</TABLE>
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Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS FOR THE QUARTER ENDED JUNE 30, 1999.
The Partnership's primary business was to lend monies to Hickory
Hills, Ltd. On December 31, 1998, the Partnership began the
process of foreclosing on the debt to Hickory Hills, Ltd. after
the note matured and payment was not made. The General Partner
determined that the value of the underlying collateral could not
result in full payment of the principal and accrued interest. The
Financial Statements included herein, as of December 31, 1998,
reflect the transfer of property to the Lender. Foreclosure
proceedings were completed on June 29, 1999.
The Registrant's primary business is now to develop and dispose of
certain undeveloped real properties located in Nashville, Davidson
County, Tennessee and Hendersonville, Sumner County, Tennessee (the
"Properties"). Registrant's investment objectives are preservation
of capital, and capital appreciation through the passage of time,
growth in the surrounding areas and the development of the
Properties prior to resale.
The general partner and its affiliates have been actively involved
in managing the Partnership, the Property and the foreclosure.
FINANCIAL CONDITION
LIQUIDITY
At June 30, 1999, the Registrant had approximately $235,689 in cash
reserves. These funds are expected to be sufficient to fund
operations through 1999.
Year 2000
In 1998, the Partnership initiated a plan ("Plan") to identify, and
remediate "Year 2000" issues within each of its significant
computer programs and certain equipment which contain
microprocessors. The Plan is addressing the issue of computer
programs and embedded computer chips being unable to distinguish
between the year 1900 and the year 2000, if a program or chip uses
only two digits rather than four to define the applicable year.
The Partnership has divided the Plan into five major phases-
assessment, planning, conversion, implementation and testing.
After completing the assessment and planning phases earlier year,
the Partnership is currently in the conversion, implementation, and
testing phases. Systems which have been determined not to be Year
2000 compliant are being either replaced or reprogrammed, and
thereafter tested for Year 2000 compliance. The Plan anticipates
that by mid-1999 the conversion, implementation and testing phases
will be completed. Management believes that the total remediation
costs for the Plan will not be material to the operations or
liquidity of the Partnership.
The Partnership is in the process of identifying and contacting
critical suppliers and other vendors whose computerized systems
interface with the Partnership's systems, regarding their plans and
progress in addressing their Year 2000 issues. The Partnership has
received varying information from such third parties on the state
of compliance or expected compliance. Contingency plans are being
developed in the event that any critical supplier or customer is
not compliant.
The failure to correct a material Year 2000 problem could result in
an interruption in, or failure of, certain normal business
activities or operations. Such failures could materially and
adversely affect the Partnership's operations, liquidity and
financial condition. Due to the general uncertainty inherent in
the Year 2000 problem, resulting in part from the uncertainty of
the Year 2000 readiness of third-party suppliers and customers, the
Partnership is unable to determine at this time whether the
consequences of Year 2000 failures will have a material impact on
the Partnership's operations, liquidity or financial condition.
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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
222 PARTNERS, INC.
General Partner
Date: August 13, 1999 By:/s/ Steven D. Ezell
President
Date: August 13, 1999 By:/s/ Michael A. Hartley
Secretary/Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1999
<CASH> 235,689
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 1,308,601
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,544,290
<CURRENT-LIABILITIES> 59,000
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,485,290
<TOTAL-LIABILITY-AND-EQUITY> 1,544,290
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 15,725
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (15,725)
<INCOME-TAX> 0
<INCOME-CONTINUING> (15,725)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (15,725)
<EPS-BASIC> (3.74)
<EPS-DILUTED> (3.74)
</TABLE>
