<PAGE> 1
FORM 10-KSB-ANNUAL OR TRANSITIONAL REPORT
UNDER SECTION 13 OR 15 (D)
FORM 10-KSB
(Mark one)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934 (NO FEE REQUIRED)
For the fiscal year ended December 31, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
Commission file number 33-20527
BRUNNER COMPANIES INCOME PROPERTIES L.P.I
---------------------------------------------
(Name of small business issuer in its charter)
Delaware 31-1234157
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
3632 Wheeler Road, Suite 2
P.0. Box 204227
Augusta, Georgia 30917-4227
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (706) 863-0823
Securities registered under Section 12(b) of the Exchange Act:
None
----
Securities registered under Section 12(g) of the Exchange Act:
Limited Partnership Units
-------------------------
(Title of class)
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 _
---
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB [X]
State issuer's revenues for its most recent fiscal year: $2,842,000
State the aggregate market value of the voting partnership interest held by
non-affiliates computed by reference to the price at which the partnership
interest were sold, or the average bid and asked prices of such partnership
interest, as of the specified date within the past 60 days: Market value
information for the registrant's partnership interest is not available. Should a
trading market develop for these interest, it is the Managing General Partner's
belief that the aggregate market value of the voting partnership's interest
would not exceed $25,000,000.
----------------------------
DOCUMENTS INCORPORATED BY REFERENCE
1. Portions of the Prospectus of Registrant dated June 10, 1988 (included
in Registration Statement, No. 33-20527, of Registrant) are
incorporated by reference into Parts I and III.
<PAGE> 2
PART I
ITEM 1.
DESCRIPTION OF BUSINESS
Brunner Companies Income Properties L.P. I (the "Registrant" or "Partnership")
is a Delaware limited partnership formed in February 1988. The Partnership will
continue in existence until December 31, 2008, unless earlier dissolved or
terminated. Brunner Management Limited Partnership (the "General Partner"), an
Ohio limited partnership formed in February 1988, is the sole general partner of
the Partnership. 104 Management, Inc. (the "Managing General Partner"), an Ohio
corporation formed in February 1988, is the sole general partner of the General
Partner, and in that capacity manages the business of the Partnership.
Commencing June 10, 1988, the Partnership offered through The Ohio Company up to
552,000 Units of Class A Limited Partnership Interests at $10 per unit
("Units"). Holders of Units are referred to as "Unitholders". An additional
61,333 units of Class B Limited Partnership Interests were issued by the
Partnership to certain affiliates of the Managing General Partner as a part of
the purchase price for an undivided interest in each retail center equivalent to
a then fair market value of $613,330 ("Subordinated Interest"). Holders of
Subordinated Interests are referred to as "Subordinated Limited Partners", and
Unitholders and Subordinated Limited Partners are collectively referred to as
"Limited Partners". Limited Partners are not required to make any additional
capital contributions. There are only two differences between the Class A and
Class B limited partnership interests. First, the holders of Class A units are
entitled to receive their Class A Priority Return before the holders of Class B
units are entitled to receive any portion of their Class B Priority Return.
Second, holders of Class B units, if such holders are affiliates of the General
Partner, are not entitled to vote upon the removal of the General Partner or
upon consideration of a sale of any Retail Center to the General Partner or any
affiliate of the General Partner.
The offering terminated on July 12, 1988. Upon termination of the offering, the
Partnership had accepted subscriptions for 552,000 Units and 61,333 Units of
Subordinated Interests for aggregate gross proceeds of $6,133,330. The
Partnership invested substantially all of the net offering proceeds in the
investment properties (the "Retail Centers"). The Partnership will not acquire
nor invest in any other properties or debt or equity securities of any other
issuers (other than short term investments of cash in high grade United States
government obligations during interim periods between the receipt of revenues
and the distribution of cash to the Limited Partners and pending payment of
operating expenses of the Partnership) and will not issue any additional limited
partnership interests or other equity securities in the Partnership. The
policies of the Partnership noted above can only be changed by an affirmative
vote of limited partners owning a majority in interest and the General Partner.
1
<PAGE> 3
The General Partner and the Managing General Partner are affiliates of a related
group of corporations and partnerships engaged generally in the real estate
development business. Pursuant to an agreement effective December 31, 1992,
IBGP, Inc., an affiliate of Insignia Financial Group, Inc. ("Insignia"),
acquired a majority of the outstanding stock of 104 Management Inc. on March 5,
1993. IBGP, Inc. was an indirect wholly-owned subsidiary of Metropolitan Asset
Enhancement, L.P. ("MAE"), an affiliate of Insignia. Both IBGP, Inc. and
Insignia Brunner, L.P. were affiliates of Metropolitan Asset Enhancement, L.P.
104 Management, Inc. is the managing general partner of Brunner Management
Limited Partnership, which is the general partner of the Registrant. On November
17, 1998, BCIP I & III, LLC purchased 104 Management, Inc. from IBGP, Inc. and
thereby acquired the general partnership interest in Brunner Management Limited
Partnership. BCIP I & III, LLC also purchased the limited partnership interest
in Brunner Management Limited Partnership and all of the outstanding Class B
Limited Partnership units of the Partnership and Brunner Companies Income
Properties L.P. I, an affiliated entity, from Insignia Brunner, L.P.
The Partnership is in the business of owning and operating three Retail Centers:
Georgetown Landing, Georgetown, South Carolina; White Horse Plaza, Greenville,
South Carolina; and Hitchcock Plaza, Aiken, South Carolina. See "Item 2.
Description of Properties" for additional information regarding the Retail
Centers. The real estate business is highly competitive. The Partnership's real
property investments are subject to competition from similar types of properties
in the vicinities in which they are located, and the Partnership is not a
significant factor in its industry. In addition, various limited partnerships
and limited liability companies have been formed by related parties to engage in
businesses which may be competitive with the Partnership.
The Partnership has no employees. Management and administrative services are
performed by affiliates of BCIP I & III, LLC. The property manager is
responsible for the day-to-day operations of each property. The Managing General
Partner has also selected affiliates of BCIP I & III, LLC to provide real estate
advisory and asset management services to the Partnership. As advisor, such
affiliates provide partnership accounting and administrative services,
investment management, and supervisory services over property management and
leasing. For a further discussion of property and partnership management, see
"Item 12", which descriptions are herein incorporated by reference.
There have been, and it is possible there may be other, Federal, state and local
legislation and regulations enacted relating to the protection of the
environment. The Partnership is unable to predict the extent, if any, to which
such new legislation or regulations might occur and the degree to which such
existing or new legislation or regulations might adversely affect the properties
owned by the Partnership.
In certain cases environmental testing has been performed, which resulted in no
material adverse conditions or liabilities. In no case has the Partnership
received notice that it is a potentially responsible party with respect to an
environmental clean up site.
2
<PAGE> 4
ITEM 2.
DESCRIPTION OF PROPERTIES
The following table sets forth the Partnership's investments in properties:
<TABLE>
<CAPTION>
Date of
Property Purchase Type of Ownership Use
- --------------------------------- -------- --------------------------- --------------
<S> <C> <C> <C>
Hitchcock Plaza 7/12/88 Fee ownership, subject to Retail Center
Aiken, South Carolina first mortgage 233,000 sf
White Horse Plaza 7/12/88 Fee ownership, subject to Retail Center
Greenville, South Carolina first mortgage 166,000 sf
Georgetown Landing 7/12/88 Fee ownership, subject Retail Center
Georgetown, South Carolina to first mortgage 50,000 sf
</TABLE>
A significant feature of all the Retail Centers is the fact that approximately
73% of the leasable space is, in the aggregate, leased to anchor tenants with
national or regional name recognition. Although such anchor tenants generally
pay lower base rents than smaller tenants, anchor tenants offer greater security
and stability of long-term leases from well-established and more credit-worthy
tenants and tend to attract greater traffic to the retail centers.
SCHEDULE OF PROPERTIES (IN THOUSANDS)
<TABLE>
<CAPTION>
Gross
carrying Accumulated Useful Federal
Property value depreciation life Method tax basis
- --------------------- ----------- ------------ ----------- --------- ---------
<S> <C> <C> <C> <C> <C>
Hitchcock Plaza $ 14,126 $ 4,151 5-31.5 yrs S/L $ 14,106
White Horse
Plaza 8,782 2,303 5-31.5 yrs S/L 8,845
Georgetown
Landing 2,158 579 31.5 yrs S/L 2,136
=========== ========== ========
$ 25,066 $ 7,033 $ 25,087
=========== ========== ========
</TABLE>
See "Note A" of the Notes to Financial Statements included in "Item 7" for a
description of the Partnership's depreciation policy.
SCHEDULE OF MORTGAGES (IN THOUSANDS):
<TABLE>
<CAPTION>
Principal balance Stated Principal due
at December 31, interest Period Maturity at maturity
Property 1998 rate (1) amortized date (1) (2)
- ---------------- ------------------ --------- ----------- --------- ------------
<S> <C> <C> <C> <C> <C>
Hitchcock
Plaza $ 10,034 7% 18 yrs 5/99 $ 10,034
White Horse
Plaza 6,356 7% 18 yrs 5/99 6,356
Georgetown
Landing 1,410 7% 18 yrs 5/99 1,410
------------ ----------
Total $ 17,800 $ 17,800
============ ==========
</TABLE>
3
<PAGE> 5
(1) On November 30, 1998, the Managing General Partner and the lender, New York
Life Insurance Company, entered into a Loan Extension/Recast Letter Agreement to
extend the maturity dates of the mortgage notes to May 10, 1999. During the
extension period, the mortgage notes bear interest at the rate of 7% per annum
and the Partnership is not required to make principal payments.
(2) The mortgages require a balloon payment at maturity for the remaining
principal balance. These notes are cross-collateralized and cross-defaulted and
are secured by the properties and by a pledge of revenues from the respective
properties.
SCHEDULE OF RENTAL RATES AND OCCUPANCY:
<TABLE>
<CAPTION>
Average Annual
Rental Rates Average Annual
(per square foot) Occupancy
-------------------------------- ------------------------------
1998 1997 1998 1997
------------- ---------------- ------------ -----------
<S> <C> <C> <C> <C>
Hitchcock Plaza $ 5.69 $ 5.95 91% 98%
White Horse Plaza 5.64 5.77 98% 97%
Georgetown Landing 4.80 5.63 94% 91%
</TABLE>
As noted under "Item 1. Description of Business", the real estate industry is
highly competitive. All of the properties of the Partnership are subject to
competition from other retail centers in the area. The Managing General Partner
believes that all of the properties are adequately insured.
The following is a schedule of the lease expirations for the years 1998-2008:
<TABLE>
<CAPTION>
Number of Annual rent % of Gross
Hitchcock Plaza expirations Square feet (in thousands) Annual Rent
- --------------- ----------- ----------- -------------- -----------
<S> <C> <C> <C> <C>
1999 5 44,100 $ 253 19.4%
2000 4 5,900 65 5.0%
2001 2 2,600 30 2.3%
2002 3 8,200 75 5.8%
2003 2 4,000 41 3.2%
2004 1 4,000 32 2.4%
2005-2006 0 0 0 0.0%
2007 1 49,296 343 26.2%
2008 0 0 0 0.0%
</TABLE>
4
<PAGE> 6
<TABLE>
<S> <C> <C> <C> <C>
White Horse Plaza
1999 2 10,150 62 6.9%
2000 1 2,880 29 3.2%
2001 2 7,200 69 7.7%
2002 2 3,350 40 4.4%
2003 1 8,400 59 6.6%
2004 2 3,750 41 4.5%
2005 0 0 0 0.0%
2006 2 117,844 532 59.3%
2007-2008 0 0 0 0.0%
Georgetown Landing
1999 0 0 0 0.0%
2000 2 2,400 21 8.6%
2001 0 0 0 0.0%
2002 2 2,400 24 9.9%
2003 2 4,920 36 15.0%
2004-2005 0 0 0 0.0%
2006 1 39,824 158 66.5%
2007-2008 0 0 0 0.0%
</TABLE>
The following schedule presents information on tenants occupying 10% or more of
the leasable square feet for each property:
<TABLE>
<CAPTION>
Nature of Square footage Annual rent Lease
business leased per square foot expiration
----------------- ----------------- --------------- -----------
<S> <C> <C> <C> <C>
Hitchcock Plaza Grocery store 49,296 $ 6.95 2/28/07
Discount store 86,479 4.16 6/30/12
Clothing store 35,000 4.04 8/31/99
White Horse Plaza Discount store 81,922 3.64 10/31/06
Grocery store 35,922 6.50 11/05/06
Georgetown Landing Grocery store 39,824 3.97 11/22/06
</TABLE>
5
<PAGE> 7
SCHEDULE OF REAL ESTATE TAXES (IN THOUSANDS) AND RATES:
<TABLE>
<CAPTION>
1998 Taxes 1998 Rate
----------- ------------
<S> <C> <C>
Hitchcock Plaza $ 92 1.99%
White Horse Plaza 76 1.58%
Georgetown Landing 36 1.96%
</TABLE>
ITEM 3.
LEGAL PROCEEDINGS
The Partnership is unaware of any pending litigation that is not of a routine
nature. The Managing General Partner believes that all such pending or
outstanding litigation will be resolved without a material adverse effect upon
the business, financial condition, or operations of the Partnership.
ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fiscal year ended December 31, 1998, no matters were submitted to a
vote of the Unitholders through the solicitation of proxies or otherwise.
PART II
ITEM 5.
MARKET FOR PARTNERSHIP EQUITY AND RELATED PARTNER MATTERS
As of December 31, 1998, the number of holders of record of Limited Partnership
Units and Subordinated Interest Units was 422 and one, respectively. Neither the
Limited Partnership Units nor the Subordinated Interest Units are traded on any
established public trading market, and it is not anticipated that such a market
will develop in the future. See "Item 11. Security Ownership of Certain
Beneficial Owners and Management."
No cash distributions were paid during 1998 or 1997. Future distributions will
depend on the levels of cash generated from operations, refinancings, property
sales and the availability of cash reserves. At this time, the Managing General
Partner does not anticipate making a cash distribution during 1999.
6
<PAGE> 8
ITEM 6.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Results of Operations
The Partnership realized a net loss of $80,000 for the year ended December 31,
1998, compared to a net loss of $101,000 for the year ended December 31, 1997.
The decrease in net loss for the year ended December 31, 1998 is primarily due
to a $96,000 decrease in interest expense. The reduction in interest expense was
due to a reduction of the principal balance and the November 30, 1998 Loan
Extension/Recast Letter Agreement entered into between the Managing General
Partner and the lender holding the mortgage notes. Partially offsetting the
decrease in interest expense was an increase in general and administrative
expenses. General and administrative expenses increased primarily due to an
increase in payments and reimbursements to affiliates of the General Partner for
costs incurred in managing the Partnership. Operating expenses increased $45,000
from 1997 to 1998, for a 14.2% increase. The increase was primarily attributed
to an increase in insurance expenses.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of each of its investment
properties to assess the feasibility of increasing rents, maintaining or
increasing occupancy levels and protecting the Partnership from increases in
expense. As part of this plan, the Managing General Partner attempts to protect
the Partnership from the burden of inflation-related increases in expenses by
increasing rents and maintaining a high overall occupancy level. However, due to
changing market conditions, which can result in the use of rental concessions
and rental reductions to offset softening market conditions, there is no
guarantee that the Managing General Partner will be able to sustain such a plan.
Hitchcock Plaza had a tenant which occupied 20,000 square feet at December 31,
1997, or approximately 9% of the property's total square feet. The tenant's
lease expired January 31, 1998 and was not renewed. The Managing General Partner
is currently negotiating a lease with a new tenant to occupy this space.
White Horse Plaza has a tenant which leases 81,922 square feet, or approximately
49% of the property's total square feet. While this tenant's lease does not
expire until October 31, 2006, and the General Partner expects the tenant to
honor its obligations under its lease, the tenant has vacated the space. The
General Partner expects this vacancy to impact occupancy for the remainder of
the property. In 1999, since this tenant vacated its space, four additional
tenants, leasing a total of 11,150 square feet in the property, or approximately
7% of the property's total square feet, have terminated their leases and have
vacated the property. In addition, a tenant which leases 35,922 square feet, or
approximately 22% of the property's total square feet, has stopped honoring its
contractual lease obligations, including payment of rent. The Managing General
Partner intends to actively pursue the Partnership's legal remedies to require
this tenant to comply with its contractual lease obligations.
7
<PAGE> 9
Liquidity and Capital Resources
The Partnership held cash and cash equivalents of $480,000 at December 31, 1998,
compared to cash and cash equivalents of $333,000 at December 31, 1997. The net
increases in cash and cash equivalents for the years ended December 31, 1998 and
1997, were $147,000 and $1,000, respectively. Net cash provided by operating
activities increased due to the decreased net loss discussed above and a
decrease in receivables, deposits, and other assets. Net cash used in investing
activities increased as a result of deposits to restricted escrows and building
improvements made at Hitchcock Plaza. Cash flow used in financing activities
increased through the first ten months of calendar year 1998 but decreased at
year end due to decreased payments on mortgage notes following the November 30,
1998 Loan Extension/Recast Letter Agreement entered into between the Managing
General Partner and the lender holding the mortgage notes.
The cross-collateralized and cross-defaulted loans on Hitchcock Plaza, White
Horse Plaza, and Georgetown Landing mature on May 10, 1999. The Partnership's
continued ability to operate is dependent on its ability to either restructure
its existing debt or raise additional capital. To that end the managing General
Partner is attempting to extend or modify the mortgage notes, negotiating
alternative financing sources requiring additional capital infusions, and
evaluating the Partnership's alternatives. However, there can be no assurance
that debt restructuring will occur or additional capital will be raised in a
manner that allows the Partnership to continue its operations in its present
form.
No distributions were made in 1998 or 1997 and future cash distributions will
depend on the levels of net cash generated from operations, refinancing,
property sales, and the availability of cash reserves after restructuring of
existing indebtedness. The managing General Partner envisions that additional
funds may need to be raised in the next twelve months in order to refinance the
existing indebtedness.
Year 2000
The "Year 2000 Issue" has arisen because many existing computer programs and
chip-based embedded technology systems use only the last two digits to refer to
a year, and therefore do not properly recognize a year that begins with "20"
instead of the familiar "19." If not corrected, many computer applications could
fail or create erroneous results. The following disclosure provides information
regarding the current status of the Partnership's Year 2000 compliance program.
The Partnership processes its records on computer hardware and software systems
maintained by Hull/Storey Development, LLC ("Hull/Storey"), the management
company retained by the General Partner of the Partnership. Hull/Storey has
adopted a compliance program because it recognizes the importance of minimizing
the number and seriousness of any disruption that may occur as a result of the
Year 2000 issue. Hull/Storey compliance program includes an assessment of its
hardware and software computer systems and embedded systems.
Hull/Storey has invested in the implementation and maintenance of accounting and
reporting systems and equipment that are intended to enable the Partnership to
provide adequately for its information and reporting needs and which are also
Year 2000 compliant. Substantially all of Hull/Storey's in-house systems have
already been certified as Year 2000 compliant
8
<PAGE> 10
through testing and other mechanisms and Hull/Storey has not delayed any systems
projects due to the Year 2000 Issue. Hull/Storey is in the process of engaging a
third party to review its Year 2000 in-house compliance. The Managing General
Partner believes that future costs associated with Year 2000 issues for
Hull/Storey's in-house systems will be insignificant and will therefore not
impact the Partnership's business, financial condition and results of
operations.
Other
Certain items discussed in this annual report may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995 (the "Reform Act") 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 materially different from any future
results, performance, or achievements expressed or implied by such
forward-looking statements. Such forward-looking statements speak only as of the
date of this annual report. The Partnership expressly disclaims any obligation
or undertaking to release publicly any updates of revisions to any
forward-looking statements contained herein to reflect any change in the
Partnership's expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.
9
<PAGE> 11
ITEM 7
FINANCIAL STATEMENTS
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
LIST OF FINANCIAL STATEMENTS
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
FINANCIAL STATEMENTS
Balance Sheet
Statements of operations
Statements of changes in partners' capital (deficit)
Statements of cash flows
Notes to financial statements
10
<PAGE> 12
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Partners
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
We have audited the accompanying balance sheet of BRUNNER COMPANIES
INCOME PROPERTIES L.P. I (the Partnership) as of December 31, 1998, and the
related statements of operations, changes in partners' capital (deficit) and
cash flows for the year then ended. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by the
Partnership's management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of BRUNNER COMPANIES
INCOME PROPERTIES L.P. I as of December 31, 1998, and the results of its
operations and its cash flows for the year then ended, in conformity with
generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that
the Partnership will continue as a going concern. As discussed in Note I to the
financial statements, the Partnership's mortgage notes payable matured in
October 1998. The Partnership received an extension from its lenders which
expires May, 1999. The Partnership's continued ability to operate is dependent
on its ability to either restructure its existing debt or raise additional
capital. These conditions raise substantial doubt about the Partnership's
ability to continue as a going concern. Management's plans regarding these
matters are also describe in Note I. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
/s/ Elliott, Davis & Company, L.L.P.
Augusta, Georgia
February 26, 1999
11
<PAGE> 13
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
The Partners
Brunner Companies Income Properties L.P. I
We have audited the accompanying statements of operations, changes in partners'
capital (deficit) and cash flows of Brunner Companies Income Properties L.P. I
for the year ended December 31, 1997. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by the
Partnership's management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of operations and cash flows of Brunner
Companies Income Properties L.P. I for the year ended December 31, 1997, in
conformity with generally accepted accounting principles.
/s/ Ernst & Young, LLP
Greenville, South Carolina
February 6, 1998
12
<PAGE> 14
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
BALANCE SHEET
(IN THOUSANDS, EXCEPT UNIT DATA)
DECEMBER 31, 1998
<TABLE>
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 480
Accounts receivable - net and deposits 342
Other assets 88
Investment properties - net 18,033
--------
$ 18,943
========
LIABILITIES
Accounts payable and accrued expenses $ 118
Accrued property tax 176
Tenant security deposits payable 20
Mortgage notes payable 17,800
--------
18,114
PARTNERS' CAPITAL (DEFICIT)
General partner's $ (29)
Class A limited partners' - 552,000 units
issued and outstanding 603
Class B limited partners' - 61,333 units
issued and outstanding 255 829
-------- --------
$ 18,943
========
</TABLE>
The accompanying notes are an integral part of this financial statement.
13
<PAGE> 15
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT UNIT DATA)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
--------------------------
1998 1997
------- --------
<S> <C> <C>
REVENUE
Rental income $ 2,832 $ 2,832
Other income 10 28
------- -------
2,842 2,860
------- -------
EXPENSES
Operating 362 317
General and administrative 105 91
Depreciation 667 670
Interest 1,588 1,684
Property taxes 200 199
------- -------
2,922 2,961
------- -------
NET LOSS FROM OPERATIONS $ (80) $ (101)
======= =======
Net loss allocated to general partner (1%) $ (1) $ (1)
Net loss allocated to Class A limited partners (71) (90)
(89.1%)
Net loss allocated to Class B limited partners
(9.9%) (8) (10)
------- -------
$ (80) $ (101)
======= =======
Net loss per Class A limited partnership unit $ (.13) $ (.16)
======= =======
</TABLE>
14
The accompanying notes are an integral part of these financial statements.
<PAGE> 16
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(IN THOUSANDS)
<TABLE>
<CAPTION>
GENERAL LIMITED PARTNERS
PARTNER CLASS A CLASS B TOTAL
------- -------- ------- -------
<S> <C> <C> <C> <C>
Original capital contributions $ 1 $ 5,520 $ 613 $ 6,134
==== ======= ===== =======
Partners' capital (deficit) at
December 31, 1996 $(27) $ 764 $ 273 $ 1,010
Net loss for the year ended
December 31, 1997 (1) (90) (10) (101)
---- ------- ----- -------
Partners' capital (deficit)
December 31, 1997 (28) 674 263 909
Net loss for the year ended
December 31, 1998 (1) (71) (8) (80)
---- ------- ----- -------
PARTNERS' CAPITAL (DEFICIT)
AT DECEMBER 31, 1998 $(29) $ 603 $ 255 $ 829
==== ======= ===== =======
</TABLE>
The accompanying notes are an integral part of these financial statements.
15
<PAGE> 17
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
DECEMBER 31,
--------------------------
1998 1997
-------- --------
<S> <C> <C>
OPERATING ACTIVITIES
Net loss $ (80) $ (101)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation 667 670
Amortization of loan costs and leasing
commissions 42 43
Change in deferred and accrued amounts
Accounts receivable and deposits 10 (154)
Other assets 34 (19)
Accounts payable and accrued expenses (26) (50)
Accrued property taxes (31) 107
Tenant security deposits payable 3 5
------- -------
Net cash provided by operating activities 619 501
INVESTING ACTIVITIES
Purchase of property improvements and replacements (22) --
Net deposits to restricted escrows -- (1)
------- -------
Net cash used in investing activities (22) (1)
FINANCING ACTIVITIES
Payments on mortgage notes payable (450) (499)
------- -------
Net increase in cash and cash equivalents 147 1
Cash and cash equivalents at beginning of year
333 332
------- -------
Cash and cash equivalents at end of year $ 480 $ 333
======= =======
Supplemental disclosure of cash flow information:
Cash paid for interest $ 1,564 $ 1,667
======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements.
16
<PAGE> 18
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
NOTES TO FINANCIAL STATEMENTS
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Brunner Companies Income Properties L.P. I (the "Partnership") a
Delaware limited partnership, which was formed on February 29, 1988,
for the purpose of acquiring and operating the following retail
centers: Hitchcock Plaza, in Aiken, South Carolina; White Horse Plaza,
in Greenville, South Carolina; and Georgetown Landing, in Georgetown,
South Carolina (collectively referred to as the "Retail Centers"). The
seller of these Retail Centers was related to the then general partners
of the Partnership.
The Partnership shall continue in existence until December 31, 2008,
unless it is earlier dissolved and terminated pursuant to the
provisions of the partnership agreement.
The general partner of the Partnership is Brunner Management Limited
Partnership ("General Partner"). The General Partner is an Ohio limited
partnership whose general partner is 104 Management, Inc. ("Managing
General Partner"). From March 5, 1993 until November 17, 1998, the
majority of the outstanding stock of 104 Management, Inc. was held by
IBGP, Inc., an affiliate of Insignia Financial Group, Inc. Prior to
November 17, 1998, IBGP, Inc. effectively controlled the Managing
General Partner of the Partnership.
On November 17, 1998, BCIP I & III, LLC, (a Georgia limited liability
company and an affiliate of Hull/Storey Development, LLC) purchased all
of the outstanding stock of 104 Management, Inc. and thereby acquired
the general partnership interest in Brunner Management Limited
Partnership. BCIP I & III, LLC also purchased all of the outstanding
Class B Limited Partnership units of the Partnership. As a result of
this transaction, BCIP I & III, LLC effectively controls the Managing
General Partner of the Partnership.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from
those estimates.
(Continued)
17
<PAGE> 19
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
CASH AND CASH EQUIVALENTS
The Partnership considers all highly liquid investments with a
maturity, when purchased, of three months or less to be cash
equivalents as well as operating cash held by the real estate
management company on behalf of the Partnership's individual
properties. At certain times, the amount of cash deposited at a bank
may exceed the limit on insured deposits.
ALLOWANCE FOR DOUBTFUL ACCOUNTS
The Partnership records as an allowance for doubtful accounts 100% of
receivables over ninety days old, 50% of receivables over sixty but
less than ninety-one days old and 100% of receivables from former
tenants.
LEASE COMMISSIONS
Lease commissions are capitalized and are amortized by the
straight-line method over the term of the applicable lease. Lease
commissions of approximately $181,000, net of accumulated amortization
of approximately $116,000, are included in other assets.
LOAN COSTS
Loan costs are amortized on a straight-line basis over the terms of the
respective loans. As of year end, loan costs have been fully amortized.
TENANT SECURITY DEPOSITS
The Partnership requires security deposits from lessees for the
duration of the lease. The security deposits are refunded when the
tenant vacates, provided the tenant has not damaged its space and is
current on its rental payments.
INVESTMENT PROPERTIES
Investment properties are stated at cost less reductions for permanent
impairments. Acquisition fees are capitalized as a cost of real estate.
The Partnership records impairment losses on long-lived assets used in
operations when events and circumstances indicate that the assets might
be impaired and the undiscounted cash flows estimated to be generated
by those assets are less than the carrying amounts of those assets.
DEPRECIATION
Buildings and improvements are depreciated on the straight-line basis
over an estimated useful life of 5 to 31.5 years. Tenant improvements
are depreciated over the term of the applicable leases.
For Federal income tax purposes, the Partnership depreciates a portion
(89 percent attributable to non tax-exempt investors) of the property's
basis using the straight-line method over thirty-one and one-half years
and the balance (11 percent attributable to tax-exempt investors) using
the straight-line method over forty years.
18
(Continued)
<PAGE> 20
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
ADVERTISING
The Partnership expenses the costs of advertising as incurred.
LEASES
The Partnership leases certain commercial space to tenants under
various lease terms. For leases with fixed rental increases during
their term, rents are recognized on a straight-line basis over the
terms of the leases. For all other leases, rents are recognized over
the terms of the leases as earned.
INCOME TAXES
No provision has been made in the financial statements for Federal
income taxes because under current law, no Federal income taxes are
paid directly by the Partnership. The Partners are responsible for
their respective share of Partnership net income or loss.
FAIR VALUE
The Partnership believes that the carrying amount of its financial
instruments (except for long-term debt) approximates their fair value
due to the short term maturity of these instruments. The fair value of
the Partnership's long term debt, after discounting the scheduled loan
payments, based on estimated borrowing rates currently available to the
Partnership, approximate its carrying balance.
RECLASSIFICATIONS
Certain reclassifications have been made to the 1997 information to
conform to the 1998 presentation.
NOTE B - PARTNERSHIP ALLOCATIONS OF INCOME, LOSS AND DISTRIBUTIONS
Distributions of operating cash flow, as defined in the partnership
agreement, will be distributed as follows:
First, to the Class A Limited Partners until they have received a
cumulative noncompounded annual cash return of 10% (Class A priority
return) of their adjusted capital contributions;
Second, to the Class B Limited Partners until they have received a
cumulative noncompounded annual cash return of 10% (Class B priority
return) of their adjusted capital contributions;
Third, to the General Partner to the extent that taxable income for the
fiscal year is allocated to the General Partner; and
Fourth, to the Class A Limited Partners and to the Class B Limited
Partners an amount equal to 90% and 10%, respectively, of the balance,
if any, remaining.
(Continued)
19
<PAGE> 21
NOTE B - PARTNERSHIP ALLOCATION OF INCOME, LOSS AND DISTRIBUTIONS, CONTINUED
Taxable income or loss from operations will be allocated 89.1% to the
Class A Limited Partners, 9.9% to the Class B Limited Partners and 1% to the
General Partner.
All excess proceeds from sales and debt refinancings generally will be
distributed in the following order:
First, to the Class A Limited Partners until their adjusted capital
contributions are reduced to zero;
Second, to the Class B Limited Partners until their adjusted capital
contributions are reduced to zero;
Third, to the Class A Limited Partners for any unpaid priority return
of cash distributions of operating cash flows;
Fourth, to the Class B Limited Partners for any unpaid priority return
of cash distributions of operating cash flows;
Fifth, to the General Partner until its original capital contribution
is reduced to zero; and
The balance, if any, 67.5% to the Class A Limited Partners, 7.5% to the
Class B Limited Partners and 25% to the General Partner.
As of December 31, 1998, the Partnership had an undeclared distribution
arrearage of approximately $4,085,000 or $7.40 per Class A unit and
approximately $642,000 or $10.48 per Class B unit of the cumulative annual 10%
cash returns.
NOTE C - MORTGAGE NOTES PAYABLE
The principle terms of the mortgage notes payable are as follows (in
thousands):
<TABLE>
<CAPTION>
Principal Monthly
balance at payment Stated Balance due
December 31, (interest interest rate Maturity date at maturity(2)
Property 1998 only) (1) (1) (1)
- ------------------ ------------ ------------ ------------- -------------- ---------------
<S> <C> <C> <C> <C> <C>
Hitchcock Plaza $ 10,034 $ 59 7% 5/99 $ 10,034
White Horse
Plaza 6,356 37 7% 5/99 6,356
Georgetown
Landing 1,410 8 7% 5/99 1,410
-------- -------- --------
Total $ 17,800 $ 104 $ 17,800
======== ======== ========
</TABLE>
20
<PAGE> 22
NOTE C - MORTGAGE NOTES PAYABLE, CONTINUED
(1) Pursuant to lender agreements the maturity dates of the mortgage notes
were extended until May 10, 1999. The agreements further provide that,
from and after October 10, 1998 through May 10, 1999, the mortgage notes
accrue interest at a fixed rate per annum of seven (7%) percent. Prior to
the agreements, the stated interest rate of the mortgage notes was nine
(9%) percent. The agreement further provides that, commencing with the
November 1998 payment and continuing monthly through the April 1999
payment, the Partnership is allowed to make interest only payments. The
agreements further provide that the lender, upon fifteen (15) days prior
written notice to the Managing General Partner, shall have the right to
accelerate repayment of the mortgage notes in full and demand the
Partnership repay the mortgage notes in full, with or without cause and
regardless of whether an event of default should exist or not.
(2) Mortgages require a balloon payment at maturity for the remaining principal
balance. These notes are all cross-collateralized and cross-defaulted.
The mortgage notes payable are nonrecourse and are secured by the
properties and by a pledge of revenues from the respective properties.
NOTE D - OPERATING LEASES
Tenants are responsible for their own utilities, maintenance of their
space, and payment of their proportionate share of common area maintenance,
utilities, insurance and real estate taxes. Real estate taxes, insurance, and
common area maintenance expenses are paid directly by the Partnership. The
Partnership is then reimbursed by the tenants for their proportionate share. The
expenses paid by the Partnership are included in the accompanying statements of
operations as property taxes and operating expenses. Amounts reimbursed by the
tenants are included in rental income.
The future minimum rental payments to be received under operating
leases that have initial or remaining noncancellable lease terms in excess of
one year as of December 31, 1998, are as follows (in thousands):
<TABLE>
<S> <C>
1999 $ 2,190
2000 1,914
2001 1,837
2002 1,637
2003 1,473
Thereafter 6,121
----------
$ 15,172
==========
</TABLE>
Five anchor tenants represent $13,073,000 of the above minimum future
rentals under leases expiring 2006, 2007, and 2012.
21
<PAGE> 23
NOTE E - MAJOR TENANTS
Rent from tenants (excluding tenant reimbursements) representing at
least 10% of rental income were as follows (in thousands):
<TABLE>
<CAPTION>
1998 1997
---------------------------------- -----------------------------------
Amount Percent Amount Percent
-------------- --------------- ------------- -----------
<S> <C> <C> <C> <C>
K-Mart Corporation $ 360 13% $ 360 13%
Kroger 343 12 343 12
Wal-Mart Stores, Inc. 298 11 298 11
</TABLE>
See "Note I - Subsequent Events".
NOTE F - INCOME TAXES
The Partnership is classified as a partnership for Federal income tax
purposes. Accordingly, no provision for income taxes is made in the financial
statements of the Partnership. Taxable income or loss of the Partnership is
reported in the income tax returns of its partners.
The following is a reconciliation of reported net loss and Federal
taxable loss (in thousands, except unit data):
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Net loss as reported $ (80) $ (101)
Add (deduct):
Depreciation differences 36 38
Unearned income (14) 8
Miscellaneous 29 (17)
------ ------
Federal taxable loss $ (29) $ (72)
====== ======
Federal taxable loss per Class A
Limited partnership unit $ (.05) $ (.12)
====== ======
</TABLE>
The following is a reconciliation between the Partnership's reported
amounts and Federal tax basis of net assets and liabilities:
<TABLE>
<S> <C>
Net assets as reported $ 829
Land and buildings 21
Accumulated depreciation 443
Syndication costs 667
Other 20
--------
Net assets - Federal tax basis $ 1,980
========
</TABLE>
22
<PAGE> 24
NOTE G - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on the Managing
General Partner and its affiliates for the management and administration of all
partnership activities. The partnership agreement provides for payments to
affiliates for services and for reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership. The following payments were made to
affiliates of the Managing General Partner in 1998 and 1997 (in thousands):
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
Property management fees (included in
operating expenses) $ 86 $ 84
Reimbursement for services of affiliates
(included in general and administrative
expenses) 46 42
Lease commissions for new leases (included in other
assets and amortized over the term of the leases)
37 26
</TABLE>
NOTE H - INVESTMENT PROPERTIES AND ACCUMULATED DEPRECIATION (IN THOUSANDS)
<TABLE>
<CAPTION>
Initial Cost
To Partnership
------------------------------------------
Net costs (removed)
capitalized
Buildings and related subsequent to
Description Encumbrances Land personal property acquisition
- ---------------------- ------------- --------- --------------------- -------------------
<S> <C> <C> <C> <C>
Hitchcock Plaza $ 10,034 $1,797 $ 12,629 $ (300)
Whitehorse Plaza 6,356 1,975 6,931 (124)
Georgetown
Landing 1,410 428 1,711 19
=========== ====== ============ ===========
Totals $ 17,800 $4,200 $ 21,271 $ (405)
=========== ====== ============ ===========
</TABLE>
23
(Continued)
<PAGE> 25
NOTE H - INVESTMENT PROPERTIES AND ACCUMULATED DEPRECIATION (IN THOUSANDS),
CONTINUED
<TABLE>
<CAPTION>
Gross carrying values
at December 31, 1998
----------------------------------------------------------------
Buildings and
related
personal Accumulated Date Depreciable
Description Land property Total depreciation acquired life-years
- ----------------- --------- ------------- --------- ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C>
Hitchcock
Plaza $ 1,756 $ 12,370 $ 14,126 $ 4,151 7/12/88 5-31.5
Whitehorse
Plaza 1,939 6,843 8,782 2,303 7/12/88 5-31.5
Georgetown
Landing 428 1,730 2,158 579 7/12/88 5-31.5
-------- ---------- -------- --------
$ 4,123 $ 20,943 $ 25,066 $ 7,033
======== ========== ======== ========
</TABLE>
The managing General Partner has evaluated the properties as if they
were a going concern and believes there is no impairment as of year end.
Reconciliation of "Investment Properties and Accumulated Depreciation":
<TABLE>
<CAPTION>
1998 1997
-------- --------
<S> <C> <C>
INVESTMENT PROPERTIES
Balance at beginning of year $25,044 $ 25,044
Property improvements 22 --
------- --------
Balance at end of year $25,066 $ 25,044
======= ========
ACCUMULATED DEPRECIATION
Balance at beginning of year $ 6,366 $ 5,696
Additions charged to expense 667 670
------- -------
Balance at end of year $ 7,033 $ 6,366
======= =======
</TABLE>
The aggregate cost of the real estate for Federal income tax purposes
at December 31, 1998 and 1997, is $25,088,000 and $25,065,000, respectively. The
accumulated depreciation balance for Federal income tax purposes at December 31,
1998 and 1997, is $6,591,000 and $5,958,000, respectively.
24
<PAGE> 26
NOTE I - SUBSEQUENT EVENTS
Subsequent to year end, Wal-Mart, a major tenant at White Horse Plaza
vacated the premises. Wal-Mart's lease, and resulting rental obligations under
the lease, do not expire until October 31, 2006. The General Partner expects
Wal-Mart to honor its obligations under its lease, however this vacancy may
impact occupancy for the remainder of the property. Subsequent to year end, four
additional tenants, leasing a total of 11,150 square feet in the property, or
approximately 7% of the property's total square feet, have terminated their
leases and vacated the property. In addition, a tenant which leases 35,922
square feet, or approximately 22% of the property's total square feet, has
stopped honoring its contractual lease obligations, including payment of rent.
The Managing General Partner intends to actively pursue the Partnership's legal
remedies to require this tenant to comply with its contractual lease
obligations.
The cross-collateralized and cross-defaulted loans on Hitchcock Plaza,
White Horse Plaza, and Georgetown Landing matured in October 1998. The
Partnership received an extension from its lenders which expires May 1999. The
Partnership's continued ability to operate is dependent on its ability to either
restructure its existing debt or raise additional capital. To that end the
managing General Partner is attempting to extend or modify the mortgage notes,
negotiating alternative financing sources requiring additional capital
infusions, and evaluating the Partnership's alternatives. However, there can be
no assurance that debt restructuring will occur or additional capital will be
raised in a manner that allows the Partnership to continue its operations in its
present form.
ITEM 8
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
There were no disagreements with Elliott, Davis & Company, L.L.P. regarding the
1998 audit of the Partnership's financial statements nor were there any
disagreements with Ernst & Young L.L.P. regarding the 1997 audit of the
Partnership's financial statements.
On December 18, 1998 the Partnership terminated the engagement of Ernst & Young,
L.L.P., Greenville, South Carolina, as the Partnership's certifying accountants.
On December 18, 1998 the Partnership engaged Elliott, Davis & Company, L.L.P.,
Augusta, Georgia as the Partnership's certifying accountants. The Partnership
has not consulted with Elliott, Davis & Company, L.L.P. during its two most
recent fiscal years nor during any subsequent interim period prior to its
engagement regarding the application of accounting principles to a specified
transaction, either completed or proposed, or the type of audit opinion that
might be rendered on the Partnership's financial statements.
The report of Ernst & Young, L.L.P. on the financial statements for either of
the last two fiscal years did not contain an adverse opinion or a disclaimer of
opinion and was not qualified or modified to uncertainty, audit scope, or
accounting principles.
PART III
ITEM 9
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS, COMPLIANCE WITH
SECTION 16(A) OF THE EXCHANGE ACT
The Partnership has no officers or directors. The Managing General Partner
manages and controls the Partnership and has general responsibility and
authority in all matters affecting its business. The names and ages of the
directors and executive officers of 104 Management, Inc., the Partnership's
Managing General Partner, and the nature of all positions with 104 Management,
Inc. presently held by them are set forth below. There are no family
relationships between or among any officers and directors.
25
<PAGE> 27
<TABLE>
<CAPTION>
Name Age Position
- ---- --- --------
<S> <C> <C>
James M. Hull 47 President and Director
Wayne Grovenstein 30 Vice President
Deborah Moseley 45 Chief Accounting Officer
Frank B. Turner, Jr. 30 Secretary
</TABLE>
James M. Hull has been President and Director of the Managing General Partner
and the Member-Manager of BCIP I & III, LLC since November of 1998. BCIP I &
III, LLC is an affiliate of Hull/Storey Development, LLC ("Hull/Storey") Mr.
Hull has acted as Member-Manager of Hull/Storey since December, 1993.
Wayne Grovenstein has been Vice President of the Managing General Partner since
November 1998. Mr. Grovenstein joined Hull/Storey in July 1995 where he serves
as Hull/Storey's Director of Development and Counsel. Prior to joining
Hull/Storey, Mr. Grovenstein was in the private practice of law in Atlanta,
Georgia.
Deborah Mosely has been the Chief Accounting Officer of the Managing General
Partner since November, 1998. Ms. Mosely joined Hull/Storey in June 1994 and has
served as Hull/Storey's Chief Accounting Officer since that time.
Frank B. Turner, Jr. has been the Secretary of the Managing General Partner
since November 1998. Mr. Turner joined Hull/Storey in February 1998 where he
serves as Counsel. From June 1996 until January 1998 Mr. Turner was an associate
with the Augusta, Georgia law firm of Dunstan, Dunstan & Cleary, P.C.
ITEM 10.
EXECUTIVE COMPENSATION
No direct form of compensation was paid by the Partnership to any director or
officer of the Managing General Partner for the year ended December 31, 1998.
The Partnership has no plans to pay any such remuneration to any director or
officer of the Managing General Partner in the future. However, reimbursements
and other payments have been made to the Partnership's Managing General Partner
and its affiliates, as described in "Item 12. Certain Relationships and
Related Transactions" below.
26
<PAGE> 28
ITEM 11.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of January 1, 1999, there were 552,000 Limited Partnership Units ("Units")
and 61,333 units of Class B Limited Partnership Interest ("Subordinated
Interest") issued and outstanding. The following table sets forth certain
information, as of January 1,1999, with respect to the ownership of Units and
units of Subordinated Interest by: (i) any person or group who is known to the
Partnership to be the beneficial owner of more than 5% of either the Units or
units of Subordinated Interest; (ii) the directors and officers of the Managing
General Partner, naming them; and (iii) the directors and officers of the
Managing General Partner as a group.
<TABLE>
<CAPTION>
Units of subordinated
Units (1) interest (1)
------------------------------- ---------------------------------
Amount Percent Amount Percent
------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C>
Insignia Brunner L.P.
One Insignia Financial Plaza
Greenville, SC 29602 -- -- 61,333 100%
All directors and officers of
The Managing General Partner
(5 persons) as a group -- -- -- --
</TABLE>
(1) The Limited Partners have no right or authority to participate in the
management or control of the Partnership or its business. However, Limited
Partners do have limited rights to approve or disapprove certain fundamental
Partnership matters as provided in "Article 7" of the Partnership Agreement.
Transfer of Units are subject to certain restrictions set forth in "Article 9"
of the Partnership Agreement.
ITEM 12.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The partnership agreement provides for payments to
affiliates for services and for reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership.
27
<PAGE> 29
The following payments were made to affiliates of the Managing General Partner
in 1998 and 1997 (in thousands):
<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
Property management fees $86 $84
Reimbursement for services of affiliates $46 $42
</TABLE>
Additionally, the Partnership paid approximately $37,000 and $26,000 to an
affiliate of the Managing General Partner for lease commissions related to new
leases at the Partnership's commercial properties during the years ended
December 31, 1998 and 1997, respectively. These lease commissions are included
in other assets and are amortized over the terms of the respective leases.
If the Partnership requires additional funds, the General Partner or its
affiliates may, but are not obligated to, lend funds to the Partnership. Any
such loan and any disposition, re-negotiation or other subsequent transaction
involving such loan, shall be made only upon receipt from an independent and
qualified advisor of an opinion letter to the effect that such proposed loan or
disposition, re-negotiation or subsequent transaction is fair and at least as
favorable to the Partnership as a loan to an unaffiliated borrower in similar
circumstances. The advisors compensation must be paid by the General Partner and
is not reimbursable by the Partnership. No such loan has yet been made by the
General Partner.
A commission of up to 2% of the sale price may be paid to Brunner Management
Limited Partnership upon the sale of each of the Retail Centers, if it performs
substantial services in connection with the sale. Any such commission paid to
the Brunner Management Limited Partnership will be subordinated to the Limited
Partners priority distributions. Total commissions paid will not exceed those
reasonable, customary and competitive in light of the size and location of the
Retail Center sold.
28
<PAGE> 30
13. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: See Exhibit Index contained herein.
(b) Reports on Form 8-K filed during the fourth quarter of 1998:
A Form 8-k was filed with the Securities and Exchange Commission on December 2,
1998. This filing discloses that there was a change in control of the Registrant
as of November 17, 1998 when BCIP I & III, LLC purchased 104 Management, Inc.
from IBGP, Inc. and thereby acquired the general partnership interest in Brunner
Management Limited Partnership. A copy of the General Partnership Sale
Agreement, dated as of November 17, 1998, by and between BCIP I & III, LLC,
IBGP, Inc. And Insignia Brunner, L.P. were also included as an exhibit.
29
<PAGE> 31
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
BRUNNER COMPANIES INCOME PROPERTIES L.P. I
A Delaware Limited Partnership
By: Brunner Management Limited Partnership
Its General Partner
By: 104 Management, Inc.
Its Managing General Partner
By: /s/ James M. Hull
---------------------------------------
James M. Hull
President and Director
Date: April 15, 1999
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
date indicated.
/s/ James M. Hull President and
- ------------------------ Director Date: 4/13/99
James M. Hull
/s/ Deborah Moseley Vice President and
- ----------------------- Chief Accounting Date: 4/13/99
Deborah Moseley Officer
30
<PAGE> 32
INDEX OF EXHIBITS
<TABLE>
<CAPTION>
Exhibit
No. Description
- ------- -----------
<S> <C>
3.1 Partnership Agreement of Brunner Companies Income Properties L.P. I
(the "Partnership"); incorporated by reference to Exhibit 4.3 to Form
10-Q for the fiscal quarter ended September 30, 1988
3.2 Certificate of Limited Partnership for the Partnership; incorporated by
reference to Exhibit 3.2 to Registration Statement No. 33-20527 on Form
S-11
4.1 Form of Class A limited Partnership Interest Unit Certificate;
incorporated by reference to Exhibit 3.1 to Pre-effective Amendment No.
1 to Registration Statement No. 33-20527 on Form S-11
4.2 Form of Class B Limited Partnership Interest Unit Certificate;
incorporated by reference to Exhibit 3.1 to Pre-effective Amendment No.
1 to Registration Statement No. 33-20527 on Form S-11
10.1 Purchase Agreement for Hitchcock Plaza; incorporated by reference to
Exhibit 19.1 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.2 Purchase Agreement for White Horse Plaza; incorporated by reference to
Exhibit 19.2 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.3 Purchase Agreement for Georgetown Landing; incorporated by reference to
Exhibit 19.3 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.4 Management Agreement for Hitchcock Plaza; incorporated by reference to
Exhibit 19.4 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.5 Management Agreement for White Horse Plaza; incorporated by reference
to Exhibit 19.5 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.6 Management Agreement for Georgetown Landing; incorporated by reference
to Exhibit 19.6 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.7 Promissory Note secured by Mortgage on Hitchcock Plaza, with New York
Life Insurance Company, as Payee; incorporated by reference to Exhibit
19.7 to Form 10-Q for the fiscal quarter ended September 30, 1988
</TABLE>
31
<PAGE> 33
<TABLE>
<S> <C>
10.8 Security Agreement relating to Hitchcock Plaza with New York Life
Insurance Company, as Secured Party; incorporated by reference to
Exhibit 19.8 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.9 Assignment of Lessor's Interest in Lease(s) relating to Hitchcock Plaza
with New York Life Insurance Company, as Mortgagee/Assignee;
incorporated by reference to Exhibit 19.9 to Form 10-Q for the fiscal
quarter ended September 30, 1988
10.10 Hitchcock Plaza Mortgage with New York Life Insurance Company;
incorporated by reference to Exhibit 19.10 to Form 10-Q for the fiscal
quarter ended September 30, 1988
10.11 Promissory Note secured by Mortgage on White Horse Plaza, with New York
Life Insurance Company, as Payee; incorporated by reference to Exhibit
19.11 to Form 10-Q for the fiscal quarter ended September 30, 1988
10.12 Security Agreement relating to White Horse Plaza with New York Life
Insurance Company, as Secured Party; incorporated by reference to
Exhibit 19.12 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.13 Assignment of Lessor's Interest in Lease(s) relating to White Horse
Plaza with New York Life Insurance Company, as Mortgagee/Assignee;
incorporated by reference to Exhibit 19.13 to Form 10-Q for the fiscal
quarter ended September 30, 1988
10.14 White Horse Plaza Mortgage with New York Life Insurance Company;
incorporated by reference to Exhibit 19.14 to Form 10-Q for the fiscal
quarter ended September 30, 1988
10.15 Promissory Note secured by Mortgage on Georgetown Landing, with New York
Life Insurance Company, as Payee; incorporated by reference to Exhibit
19.15 to Form 10-Q for the fiscal quarter ended September 30, 1988
10.16 Assignment of Lessor's Interest in Lease(s) relating to Georgetown
Landing with New York Life Insurance Company, as Mortgagee/Assignee;
incorporated by reference to Exhibit 19.16 to Form 10-Q for the fiscal
quarter ended September 30, 1988.
10.17 Security Agreement relating to Georgetown Landing with New York Life
Insurance Company, as Secured Party; incorporated by reference to
Exhibit 19.17 to Form 10-Q for the fiscal quarter ended September 30,
1988
10.18 Georgetown Landing Mortgage with New York Life Insurance Company;
</TABLE>
32
<PAGE> 34
<TABLE>
<S> <C>
incorporated by reference to Exhibit 19.18 to Form 10-Q for the fiscal
quarter ended September 30, 1988
10.19 Commitment letter between New York Life Insurance Company and MBB
Development Associates; incorporated by reference to Exhibit 10.7 to
Registration Statement No. 33-20527 on Form S-11
10.20 Commitment letter between New York Life Insurance Company and Dayton &
Associates VII; incorporated by reference to Exhibit 10.8 to
Registration Statement No. 33-20527 on Form S-11
10.21 Commitment letter between New York Life Insurance Company and Dayton &
Associates VII; incorporated by reference to Exhibit 10.9 to
Registration Statement No. 33-20527 on Form S-11
10.22 Hitchcock Center Lease with Goody's Family Clothing, Inc.; incorporated
by reference to Exhibit 10.10 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.23 Hitchcock Center Lease with Franchise Enterprises, Inc.; incorporated
by reference to Exhibit 10.11 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.24 Hitchcock Center Lease with Key Wholesale Corporation; incorporated by
reference to Exhibit 10.12 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.25 Side Agreement Regarding Rent Guarantee between MBB Development
Associates and the Partnership; incorporated by reference to Exhibit
10.31 to Form 10-K for the fiscal year ended December 31, 1988
10.26 Release and Termination of Lease between the Partnership and Key
Wholesalers of Columbia, Inc.; incorporated by reference to Exhibit
19.1 to Form 10-Q for the fiscal quarter ended June 30, 1989
10.27 Hitchcock Center Lease between the Partnership and Southco, Inc.;
incorporated by reference to Exhibit 19.2 to Form 10-Q for the fiscal
quarter ended June 30, 1989
10.28 Construction Agreement between the Partnership and Gillam & Associates,
Inc. regarding Southco renovations; incorporated by reference to
Exhibit 19.3 to Form 10-Q for fiscal quarter ended June 30, 1989
10.29 Agreement between the Partnership and MBB Development Associates
</TABLE>
33
<PAGE> 35
<TABLE>
<S> <C>
regarding Southco renovations; incorporated by reference to Exhibit
19.4 to Form 10-Q for the fiscal quarter ended June 30, 1989
10.30 Hitchcock Center Lease with The Kroger Company; incorporated by
reference to Exhibit 10.13 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.31 Hitchcock Center Lease with K-Mart Corporation; incorporated by
reference to Exhibit 10.14 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.32 White Horse Plaza Lease with Wal-Mart Stores, Inc.; incorporated by
reference to Exhibit 10.19 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.33 Amendment to Wal-Mart lease with White Horse Plaza; incorporated by
reference to Exhibit 19.1 to Form 10-Q for fiscal quarter ended
September 30, 1989
10.34 Second Amendment to Wal-Mart lease with White Horse Plaza; incorporated
by reference to Exhibit 19.2 to Form 10-Q for fiscal quarter ended
September 30, 1989
10.35 White Horse Plaza Lease with Winn-Dixie Greenville, Inc.; incorporated
by reference to Exhibit 10.20 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.36 Georgetown Landing Transfer and Assignment of Lease with Rhonda and
Leon Detzler; incorporated by reference to Exhibit 10.24 to Pre-
effective Amendment No. 1 to Registration Statement No. 33-20527 on
Form S-11
10.37 Georgetown Landing Lease with Food Lion, Inc.; incorporated by
reference to Exhibit 10.25 to Pre-effective Amendment No. 1 to
Registration Statement No. 33-20527 on Form S-11
10.38 Letter Agreement dated January 14, 1991, amending the Georgetown
Landing Lease with Coast-to-Coast incorporated by reference to Exhibit
10.38 to Form 10-K as of fiscal year end December 31, 1990
10.39 Advisory Agreement made as of September 1, 1991 between Brunner
Companies Income Properties L.P. I and Insignia GP Corporation and
Insignia Financial Group, Inc. incorporated by reference to Exhibit
19.1 to Form 10-Q for the fiscal quarter ended September 30, 1991
</TABLE>
34
<PAGE> 36
<TABLE>
<S> <C>
10.40 First Amendment to Advisory Agreement changing effective date from
September 1, 1991 to October 1, 1991 incorporated by reference to
Exhibit 19.2 to Form 10-Q for the fiscal quarter ended September 30,
1991
10.41 Management Agreement for Georgetown Landing made as of December 1, 1991
between Brunner Companies Income Properties L.P. and Insignia
Management Group, L.P. incorporated by reference to Exhibit 10.41 to
Form 10-K as of fiscal year end December 31, 1991
10.42 Management Agreement for White Horse Plaza made as of December 1, 1991
between Brunner Companies Income Properties L.P. I and Insignia
Management Group, L.P. incorporated by reference to Exhibit 10.42 to
Form 10-K as of fiscal year end December 31, 1991
10.43 Hitchcock Center Lease with Consolidated Stores Corporation
incorporated by reference to Exhibit 10.43 to Form 10-K as of fiscal
year end December 31, 1991
10.44 Transfer Agent Agreement between Brunner Companies Income Properties
L.P. I and Insignia GP Corporation incorporated by reference to Exhibit
10.44 to Form 10-K as of fiscal year end December 31, 1991
10.45 Letter Agreement amending Georgetown Landing Lease with Coast-to-Coast
incorporated by reference to Exhibit 10.45 to Form 10-K as of fiscal
year end December 31, 1991
10.46 Closing Agreement dated October 16, 1992 showing the acquisition of a
majority of the outstanding stock of 104 Management, Inc. by IBGP, Inc.
incorporated by reference to Exhibit 2 to Form 8-K dated March 5, 1993
10.47 Third loan modification and extension agreement, cross-pledge and
default agreement, and mortgage amendment agreement relating to
Hitchcock Plaza effective September 29, 1995 by and between New York
Life Insurance Company and Brunner Companies Income Properties, L.P. I,
a Delaware Limited Partnership incorporated by reference to Exhibit
10.47 to Form 10-QSB for the fiscal quarter ended September 30, 1995.
10.48 Third loan modification and extension agreement, cross-pledge and
default agreement, and mortgage amendment agreement relating to
Whitehorse Plaza effective September 29, 1995 by and between New York
Life Insurance Company and Brunner Companies Income Properties, L.P. I,
a Delaware Limited Partnership incorporated by reference to Exhibit
10.47 to Form 10-QSB for the fiscal quarter ended September 30, 1995.
10.49 Third loan modification and extension agreement, cross-pledge and
default agreement, and mortgage amendment agreement relating to
Georgetown
</TABLE>
35
<PAGE> 37
<TABLE>
<S> <C>
Landing effective September 29, 1995 by and between New York Life
Insurance Company and Brunner Companies Income Properties, L.P. I, a
Delaware Limited Partnership incorporated by reference to Exhibit 10.47
to Form 10-QSB for the fiscal quarter ended September 30, 1995.27
Financial Data Schedule.
10.50 Modification Agreement relating to Hitchcock Plaza with New York Life
Insurance Company, as Secured Party.
10.51 Modification Agreement relating to White Horse Plaza with New York
Life Insurance Company, as Secured Party.
10.52 Modification Agreement relating to Georgetown Plaza with New York Life
Insurance Company, as Secured Party.
27 Financial Data Schedule (for SEC use only).
</TABLE>
36
<PAGE> 1
EXHIBIT 10.50
STATE OF SOUTH CAROLINA )
) MODIFICATION AGREEMENT
COUNTY OF AIKEN ) RELATING INTER ALIA TO THE
) FOLLOWING:
)
) MORTGAGE, ASSIGNMENT OF
) LEASES AND RENTS AND
) SECURITY AGREEMENT
) DATED JUNE 6, 1998 TO
) BE EFFECTIVE JUNE 8, 1988
) AND RECORDED WITH THE
) REGISTER OF DEEDS
) FOR AIKEN COUNTY,
) SOUTH CAROLINA IN MORTGAGE
) BOOK 1052 AT PAGE 198
THIS MODIFICATION AGREEMENT (the "Agreement") executed this 21st Day of
December, 1998 to be effective as of the 10th day of October, 1988 by and
between BRUNNER COMPANIES INCOME PROPERTIES, L.P., I, as successor in interest
to MBB DEVELOPMENT ASSOCIATES, ("Borrower") and NEW YORK LIFE INSURANCE
COMPANY, whose address is 51 Madison Avenue, New York, New York, 10010,
("NYLIC").
WITNESSETH
WHEREAS, NYLIC previously made a loan available to the Borrower in the original
principal amount of Eleven Million Four Hundred Thousand and No/100 Dollars
($11,400,000.00)(the "Loan");
WHEREAS, the Loan was evidenced by that certain promissory note in the original
amount of $11,400,000.00 from Borrower for the benefit of NYLIC (the "Note") and
secured inter alia by a lien on that certain parcel of real property and
improvements thereon pursuant to that certain Mortgage, Assignment of Leases and
Rents and Security Agreement from Borrower dated June 6, 1988 to be effective
June 8, 1988 and recorded with the Register of Deeds for Aiken County, South
Carolina in Mortgage Book 1052 at Page 198 as amended by that certain Loan
Modification and Extension Agreement and Mortgage Amendment, effective as of
June 10, 1993 recorded in Mortgage Book 718, page 337, as further amended by
that certain Second Loan Modification and Extension Agreement and Mortgage
Amendment, effective as of June 10, 1994, recorded in Mortgage Book 777, Page
324 and further amended by that certain Third Loan Modification and Extension
Agreement, Cross Pledge and Default Agreement, and Mortgage Amendment Agreement,
effective September 29, 1995 recorded in Mortgage Book 805, Page 48 (as amended,
modified or assigned, the "Mortgage").
WHEREAS, the Note and the Mortgage and any and all other documents related to
the Loan are collectively referred to as the "Loan Documents".
<PAGE> 2
WHEREAS, except as otherwise provided, all terms herein shall have the
meanings ascribed thereto in the Loan Documents;
WHEREAS, the Loan became due and payable in full on October 10, 1998, which
was the maturity date of the Loan, NYLIC has notified Borrower of the same and
Borrower desires NYLIC to waive the event of default and modify the terms of
the Loan Documents; and
WHEREAS, Borrower and NYLIC have agreed to amend certain terms of the Loan
and the Loan Documents to inter alia change the maturity date of the Loan to May
10, 1999, to provide a new repayment schedule and to modify the interest rate.
NOW, THEREFORE, in consideration of the mutual promises contained
hereinbelow, the sum of Five and No/100 Dollars ($5.00) and other good and
valuable consideration, the receipt, sufficiency and adequacy of which the
parties do hereby acknowledge, the parties do hereby agree as follows:
1. The Note, and Loan Documents as applicable, are amended as follows:
(a) From and after October 10, 1998 through May 10, 1999 (the
"Extended Maturity Date"), the Loan will accrue interest at a
fixed rate per annum equal to seven (7%) percent;
(b) Commencing November 10, 1998 and continuing on the tenth day of
December 1998, January 1999, February 1999, March 1999 and April
1999, interest only payments in the amount of $58,524.22 will be
due and payable;
(c) Commencing November 10, 1998 and continuing on the tenth day of
December 1998, January 1999, February 1999, March 1999 and April
1999, Borrower will deposit into escrow with NYLIC payments for
insurance and ad valorem taxes as required under the Loan
Documents (such monthly payments currently being equal to
$5,758.00);
(d) Unless sooner demanded as provided herein, all outstanding
principal together with accrued unpaid interest due under the Loan
shall be due and payable in full on May 10, 1999;
(e) The Borrower shall be entitled to prepay the Note in full at par
without fee or premium on a date which is designated by Borrower
in writing given to NYLIC at least ten (10) days prior to such
date; and,
(f) Notwithstanding anything to the contrary in the Note or Loan
Documents, NYLIC shall have the right, at its sole option, upon
fifteen (15) days prior written notice to Borrower, with or
without cause and irregardless of
2
<PAGE> 3
whether an event of default shall exist or not, to accelerate
repayment of the Loan in full and demand Borrower repay the Loan
in full.
2. The Loan Documents are amended by deleting all references to the
maturity date of "October 10, 1998" and substituting in lieu thereof the
maturity date of May 10, 1999.
3. The principal balance due and owing under the Loan Documents as of the
date hereof, after giving effect to Borrower's payment of all principal
payments required to be paid hereunder, is $10,032,724.12.
4. The Borrower represents and warrants that, at the time of the execution
and delivery of this Agreement, Borrower has good and absolute title to the
real property encumbered by the Loan Documents, and has full power and
authority to subject the same to the lien of the Loan Documents and the same is
free and clear of all liens, charges and encumbrances whatsoever, except those
created by the Loan Documents or those known to NYLIC and those set forth in
NYLIC's existing title insurance policy for the Loan (the "Title Policy").
5. Except as otherwise modified hereby, the terms and provisions of the
Loan Documents shall remain in full force and effect.
6. As a condition precedent to NYLIC's agreement herein:
(a) Upon the execution of this Agreement, Borrower shall pay all
costs and expenses, including but not limited to attorney's fees,
recording fees and title charges incurred in connection with this
Agreement and/or the consummation of the transaction contemplated
hereby together with all costs and expenses of NYLIC, including
without limitation, all attorney's fees and expenses incurred as
a result of Borrower's failure to pay the amounts due under the
Loan on or before October 10, 1998; provided, however, Borrower
shall not be required to pay any amounts in excess of those
limits agreed to by Borrower and NYLIC in that certain letter
agreement dated November 24, 1998.
(b) no default shall exist under the Loan Documents as of the date
hereof nor shall any event have occurred which with the passage
of time or the giving of notice, or both, would constitute such a
default;
(c) on or before November 30, 1998, NYLIC shall have received (i) a
payment in the amount of $107,517 representing the installment of
principal and accrued interest due on October 10, 1998 and late
charges in the amount of $563.70; and, (ii) an additional payment
of $64,282.22 representing accrued interest through November 10,
1998 and the required escrow deposit due for such date;
3
<PAGE> 4
(d) on or before December 31, 1998, Borrower shall provide or cause
to be provided to NYLIC an independent title report opining that
there are no matters of record filed subsequent to the effective
date of Lender's Title Policy except for such matters as are
expressly approved by NYLIC in its discretion.
7. Borrower and NYLIC agree that it is the intent of the parties that the
execution of this Agreement or any documents as contemplated by this Agreement
or the consummation of any transactions contemplated by this Agreement shall
constitute a modification, restatement and renewal under the Loan and shall not
be construed as a novation.
8. By executing this Agreement, Borrower is reconfirming the accuracy and
correctness of all representations contained in the Loan Documents.
9. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original, but all of which shall constitute one
and the same instrument, and in making proof of this Agreement, it shall not be
necessary to produce or account for more than one such counterpart.
10. Borrower hereby agrees that NYLIC, and its officers, directors,
employees and agents are irrevocably and unconditionally released and
discharged of any and all claims, demands, obligations, liabilities, costs and
expenses, now existing (including, without limitation, any obligations or
commitment of NYLIC to provide any financial accommodations to Borrower under
the Loan Documents) arising out of or related to the Loan Documents.
[THE REST OF THIS PAGE HAS BEEN LEFT BLANK]
4
<PAGE> 5
IN WITNESS WHEREOF, the parties have executed this Agreement as of this
21st Day of December, 1998 to be effective as of October 10, 1998.
WITNESSES AS TO BORROWER: BORROWER:
BRUNNER COMPANIES INCOME
PROPERTIES, L.P.I., as successor in
interest to MBB DEVELOPMENT
ASSOCIATES (SEAL)
By: Brunner Management, LP
----------------------------------------
As Its: General Partner
----------------------------------------
By: /s/
----------------------------------------
/s/ Name: Frank B. Turner, Jr.
- ---------------------------------- ----------------------------------------
/s/ Sharon O. Allen Its: Authorized Agent
- ---------------------------------- ----------------------------------------
Sharon O. Allen
5
<PAGE> 6
IN WITNESS WHEREOF, the parties have executed this Agreement this 21st Day
of December, 1998 to be effective as of October 10, 1998.
WITNESS AS TO NYLIC: NYLIC:
NEW YORK LIFE INSURANCE COMPANY (SEAL)
By: /S/
----------------------------------------
/S/ Name: /S/ Michael J. Falabella
- ----------------------------------- ----------------------------------------
/S/ Its: Real Estate Vice President
- ----------------------------------- ----------------------------------------
6
<PAGE> 7
STATE OF GEORGIA )
) PROBATE
COUNTY OF RICHMOND )
PERSONALLY appeared before me the undersigned witness and made oath that
s/he saw the within-written Brunner Companies Income Properties, L.P.I., as
successor in interest to MBB Development Associates by Frank B. Turner, Jr.,
its Authorized Agent, sign, seal, and as its act and deed, deliver the
within-written instrument for the uses and purposes therein mentioned, and
that s/he with the other witness whose signature appears above, witnessed the
execution thereof.
/s/
----------------------------------------
Witness
SWORN TO BEFORE me this
17th day of December, 1998.
/s/ Sharon O. Allen (L.S.)
- --------------------
Notary Public for Georgia
My Commission Expires: 8/20/02
7
<PAGE> 8
STATE OF NEW YORK )
) PROBATE
COUNTY OF NEW YORK )
PERSONALLY appeared before me the undersigned witness and made oath
that s/he saw the within-written New York Life Insurance Company, by Michael J.
Falabella, its Real Estate Vice President, sign, seal, and as its act
and deed, deliver the within-written instrument for the uses and purposes
therein mentioned, and that s/he with the other witness whose signature appears
above, witnessed the execution thereof.
/s/ __________________
Witness
SWORN TO before me this
21st day of December, 1998.
/s/ ______________________(L.S.)
Notary Public for New York
My Commission Expires:
8
<PAGE> 1
EXHIBIT 10.51
STATE OF SOUTH CAROLINA )
) MODIFICATION AGREEMENT
COUNTY OF GREENVILLE ) RELATING INTER ALIA TO THE
) FOLLOWING:
)
) MORTGAGE, ASSIGNMENT OF
FILED ) LEASES AND RENTS AND
JAN 13 1999 ) SECURITY AGREEMENT
Judy G. Hix ) DATED JUNE 2, 1988
Register of Deeds ) AND RECORDED WITH THE
) REGISTER OF DEEDS
) FOR GREENVILLE COUNTY,
) SOUTH CAROLINA IN MORTGAGE
) BOOK 1936 AT PAGE 273
THIS MODIFICATION AGREEMENT (the "Agreement") executed this 21st day of
December, 1998 to be effective as of the 10th day of October, 1998 by and
between BRUNNER COMPANIES INCOME PROPERTIES, L.P., I, as successor in interest
to DAYTON & ASSOCIATES VII, ("Borrower") and NEW YORK LIFE INSURANCE COMPANY,
whose address is 51 Madison Avenue, New York, New York 10010, ("NYLIC").
WITNESSETH:
WHEREAS, NYLIC previously made a loan available to the Borrower in the
original principal amount of Seven Million Fifty Thousand and No/100 Dollars
($7,050,000.00) (the "Loan");
WHEREAS, the Loan was evidenced by that certain promissory note in the
original amount of $7,050,000.00 from Borrower for the benefit of NYLIC (the
"Note") and secured inter alia by a lien on that certain parcel of real property
and improvements thereon pursuant to that certain Mortgage, Assignment of Leases
and Rents and Security Agreement from Borrower dated June 2, 1988 and recorded
with the Register of Deeds for Greenville County, South Carolina in Mortgage
Book 1936 at Page 273 as amended by that certain Loan Modification and
Extension Agreement and Mortgage Amendment, effective as of June 10, 1993
recorded in Mortgage Book 2442, page 450, as further amended by that certain
Second Loan Modification and Extension Agreement and Mortgage Amendment,
effective as of June 10, 1994, recorded in Mortgage Book 2632, Page 103 and
further amended by that certain Third Loan Modification and Extension Agreement,
Cross Pledge and Default Agreement, and Mortgage Amendment Agreement, effective
September 29, 1995 recorded in Mortgage Book 2700, Page 1867 (as amended,
modified or assigned, the "Mortgage").
WHEREAS, the Note and the Mortgage and any and all other documents related
to the Loan are collectively referred to as the "Loan Documents".
<PAGE> 2
WHEREAS, except as otherwise provided, all terms herein shall have the
meanings ascribed thereto in the Loan Documents;
WHEREAS, the Loan became due and payable in full on October 10, 1998, which
was the maturity date of the Loan, NYLIC has notified Borrower of the same and
Borrower desires NYLIC to waive the event of default and modify the terms of the
Loan Documents; and
WHEREAS, Borrower and NYLIC have agreed to amend certain terms of the Loan
and the Loan Documents to inter alia change the maturity date of the Loan to May
10, 1999, to provide a new repayment schedule and to modify the interest rate.
NOW, THEREFORE, in consideration of the mutual promises contained
hereinbelow, the sum of Five and No/100 Dollars ($5.00) and other good and
valuable consideration, the receipt, sufficiency and adequacy of which the
parties do hereby acknowledge, the parties do hereby agree as follows:
1. The Note, and Loan Documents as applicable, are amended as follows:
(a) From and after October 10, 1998 through May 10, 1999 (the "Extended
Maturity Date"), the Loan will accrue interest at a fixed rate per
annum equal to seven (7%) percent;
(b) Commencing November 10, 1998 and continuing on the tenth day of
December 1998, January 1999, February 1999, March 1999 and April
1999, interest only payments in the amount of $37,072.47 will be
due and payable;
(c) Commencing November 10, 1998 and continuing on the tenth day of
December 1998, January 1999, February 1999, March 1999 and April
1999, Borrower will deposit into escrow with NYLIC payments for
insurance and ad valorem taxes as required under the Loan Documents
(such monthly payments currently being equal to $8,011.00);
(d) Unless sooner demanded as provided herein, all outstanding
principal together with accrued unpaid interest due under the Loan
shall be due and payable in full on May 10, 1999;
(e) The Borrower shall be entitled to prepay the Note in full at par
without fee or premium on a date which is designated by Borrower in
writing given to NYLIC at least ten (10) days prior to such date;
and,
(f) Notwithstanding anything to the contrary in the Note or Loan
Documents, NYLIC shall have the right, at its sole option, upon
fifteen (15) days prior written notice to Borrower, with or without
cause and irregardless of
2
<PAGE> 3
whether an event of default shall exist or not, to accelerate
repayment of the Loan in full and demand Borrower repay the Loan
in full.
2. The Loan Documents are amended by deleting all references to the
maturity date of "October 10, 1998" and substituting in lieu thereof the
maturity date of May 10, 1999.
3. The principal balance due and owing under the Loan Documents as of the
date hereof, after giving effect to Borrower's payment of all principal payments
required to be paid hereunder is $6,355,280.53.
4. The Borrower represents and warrants that, at the time of the execution
and delivery of this Agreement, Borrower has good and absolute title to the real
property encumbered by the Loan Documents, and has full power and authority to
subject the same to the lien of the Loan Documents and the same is free and
clear of all liens, charges and encumbrances whatsoever, except those created by
the Loan Documents or those known to NYLIC and those set forth in NYLIC's
existing title insurance policy for the Loan (the "Title Policy").
5. Except as otherwise modified hereby, the terms and provisions of the
Loan Documents shall remain in full force and effect.
6. As a condition precedent to NYLIC's agreement herein:
(a) upon the execution of this Agreement, pay all costs and expenses,
including but not limited to attorney's fees, recording fees and
title charges incurred in connection with this Agreement and/or
the consummation of the transaction contemplated hereby together
with all costs and expenses of NYLIC, including attorney's fees
and expenses incurred as a result of Borrower's failure to pay the
amounts due under the Loan on or before October 10, 1998;
provided, however, Borrower shall not be required to pay any
amounts in excess of those limits agreed to by Borrower and NYLIC
in that certain letter agreement dated November 24, 1998;
(b) no default shall exist under the Loan Documents as of the date
hereof nor shall any event have occurred which with the passage of
time or the giving of notice, or both, would constitute such a
default;
(c) on or before November 30, 1998, NYLIC shall have received (i) a
payment in the amount of $72,471.00 representing the installment
of principal and accrued interest due on October 10, 1998 and late
charges in the amount of $357.07; and, (ii) an additional payment
of $45,083.47 representing accrued interest through November 10,
1998 and the required escrow deposit due for such date;
3
<PAGE> 4
(d) on or before December 21, 1998, Borrower shall provide or cause to
be provided to NYLIC an independent title report opining that
there are no matters of record filed subsequent to the effective
date of Lender's Title Policy except for such matters as are
expressly approved by NYLIC in its discretion.
7. Borrower and NYLIC agree that it is the intent of the parties that the
execution of this Agreement or any documents as contemplated by this Agreement
or the consummation of any transactions contemplated by this Agreement shall
constitute a modification, restatement and renewal under the Loan and shall not
be construed as a novation.
8. By executing this Agreement, Borrower is reconfirming the accuracy and
correctness of all representations contained in the Loan Documents.
9. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original, but all of which shall constitute one
and the same instrument, and in making proof of this Agreement, it shall not be
necessary to produce or account for more than one such counterpart.
10. Borrower hereby agrees that NYLIC, and its officers, directors,
employees and agents are irrevocably and unconditionally released and discharged
of any and all claims, demands, obligations, liabilities, costs and expenses,
now existing (including, without limitation, any obligations or commitment of
NYLIC to provide any financial accommodations to Borrower under the Loan
Documents) arising out of or related to the Loan Documents.
[THE REST OF THIS PAGE HAS BEEN LEFT BLANK]
4
<PAGE> 5
IN WITNESS WHEREOF, the parties have executed this Agreement as of this
21st day of December, 1998 to be effective as of October 10, 1998.
WITNESSES AS TO BORROWER: BORROWER
BRUNNER COMPANIES INCOME
PROPERTIES, L.P.I, as successor in
interest to DAYTON & ASSOCIATES VII
(SEAL)
By: Brunner Management, L.P.
------------------------
As Its: General Partner
--------------------
/S/ SHARON O. ALLEN By: /s/ Frank B. Turner, Sr.
- ------------------- ------------------------
Name: Frank B. Turner, Sr.
----------------------
Its: Authorized Agent
-----------------------
5
<PAGE> 6
IN WITNESS WHEREOF, the parties have executed this Agreement this 21st day
of December, 1998 to be effective as of October 10, 1998.
WITNESS AS TO NYLIC: NYLIC:
NEW YORK LIFE INSURANCE COMPANY
(SEAL)
/s/ By: /s/ Michael J. Falabella
- -------------------------------- ------------------------------
Name: Michael J. Falabella
/s/ -----------------------------
- --------------------------------
Its: Real Estate Vice President
-----------------------------
6
<PAGE> 7
STATE OF GEORGIA )
) PROBATE
COUNTY OF RICHMOND )
PERSONALLY appeared before me the undersigned witness and made oath that
s/he saw the within-written Brunner Companies Income Properties, L.P.I, as
successor in interest to Dayton & Associates VII by Frank D. Turner, Jr., its
Authorized Agent, sign, seal, and as its act and deed, deliver the
within-written instrument for the uses and purposes therein mentioned, and that
s/he with the other witness whose signature appears above, witnessed the
execution thereof.
/s/___________________
Witness
SWORN TO before me this
17th day of December, 1998.
/s/ Sharon O. Allen (L.S.)
- -------------------
Notary Public for Georgia
My Commission Expires: 8/20/02
7
<PAGE> 8
STATE OF NEW YORK )
) PROBATE
COUNTY OF NEW YORK )
PERSONALLY appeared before me the undersigned witness and made oath that
s/he saw the within-written New York Life Insurance Company, by Michael J.
Falabella, its Real Estate Vice President, sign, seal, and as its act and deed,
deliver the within-written instrument for the uses and purposes therein
mentioned, and that s/he with the other witness whose signature appears above,
witnessed the execution thereof.
/s/
-----------------------------------
Witness
SWORN TO before me this
21st day of December, 1998.
/s/ Modesta R. Kraemer
----------------------------------
Notary Public for New York
My Commission Expires: 1/26/99
---------------
8
<PAGE> 1
EXHIBIT 10.52
STATE OF SOUTH CAROLINA )
) MODIFICATION AGREEMENT
COUNTY OF GEORGETOWN ) RELATING INTER ALIA TO THE
) FOLLOWING:
)
) MORTGAGE, ASSIGNMENT OF
) LEASES AND RENTS AND
) SECURITY AGREEMENT
) DATED JUNE 2, 1988
) AND RECORDED WITH THE
) REGISTER OF DEEDS
) FOR GEORGETOWN COUNTY,
) SOUTH CAROLINA IN MORTGAGE
) BOOK 337 AT PAGE 133
THIS MODIFICATION AGREEMENT (the "Agreement") executed this ____ Day of
December, 1998 to be effective as of the 10th day of October, 1998 by and
between BRUNNER COMPANIES INCOME PROPERTIES, L.P., I, as successor in interest
to DAYTON & ASSOCIATES XII, ("Borrower") and NEW YORK LIFE INSURANCE COMPANY,
whose address is 51 Madison Avenue, New York, New York 10010, ("NYLIC").
WITNESSETH:
WHEREAS, NYLIC previously made a loan available to the Borrower in the
original principal amount of One Million Six Hundred Thousand and No/100 Dollars
($1,600,000.00) (the "Loan");
WHEREAS, the Loan was evidenced by that certain promissory note in the
original amount of $1,600,000.00 from Borrower for the benefit of NYLIC (the
"Note:") and secured inter alia by a lien on that certain parcel of real
property and improvements thereon pursuant to that certain Mortgage, Assignment
of Leases and Rents and Security Agreement from Borrower dated June 2, 1988 and
recorded with the Register of Deeds for Georgetown County, South Carolina in
Mortgage Book 337 at Page 133 as amended by that certain Loan Modification and
Extension Agreement and Mortgage Amendment, effective as of June 10, 1993
recorded in Mortgage Book 642, page 299, as further amended by that certain
Second Loan Modification and Extension Agreement and Mortgage Amendment,
effective as of June 10, 1994, recorded in Mortgage Book 742, Page 248 and
further amended by that certain Third Loan Modification and Extension Agreement,
Cross Pledge and Default Agreement, and Mortgage Amendment Agreement, effective
September 29, 1995 recorded in Mortgage Book 796, Page 144 (as amended, modified
or assigned, the "Mortgage").
WHEREAS, the Note and the Mortgage and any and all other documents related
to the Loan are collectively referred to as the "Loan Documents".
<PAGE> 2
WHEREAS, except as otherwise provided, all terms herein shall have the
meanings ascribed thereto in the Loan Documents;
WHEREAS, the Loan became due and payable in full on October 10, 1998, which
was the maturity date of the Loan, NYLIC has notified Borrower of the same and
Borrower desires NYLIC to waive the event of default and modify the terms of the
Loan Documents; and
WHEREAS, Borrower and NYLIC have agreed to amend certain terms of the Loan
and the Loan Documents to inter alia change the maturity date of the Loan to May
10, 1999, to provide a new repayment schedule and to modify the interest rate.
NOW, THEREFORE, in consideration of the mutual promises contained
hereinbelow, the sum of Five and No/100 Dollars ($5.00) and other good and
valuable consideration, the receipt, sufficiency and adequacy of which the
parties do hereby acknowledge, the parties do hereby agree as follows:
1. The Note, and Loan Documents as applicable, are amended as follows:
(a) From and after October 10, 1998 through May 10, 1999 (the "Extended
Maturity Date"), the Loan will accrue interest at a fixed rate per
annum equal to seven (7%) percent;
(b) Commencing November 10, 1998 and continuing on the tenth day of
December 1998, January 1999, February 1999, March 1999 and April
1999, interest only payments in the amount of $8,226.27 will be due
and payable;
(c) Commencing November 10, 1998 and continuing on the tenth day of
December 1998, January 1999, February 1999, March 1999 and April
1999, Borrower will deposit into escrow with NYLIC payments for
insurance and ad valorem taxes as required under the Loan Documents
(such monthly payments currently being equal to $3,444.00);
(d) Unless sooner demanded as provided herein, all outstanding
principal together with accrued unpaid interest due under the Loan
shall be due and payable in full on May 10, 1999;
(e) The Borrower shall be entitled to prepay the Note in full at par
without fee or premium on a date which is designated by Borrower in
writing given to NYLIC at least ten (10) days prior to such date;
and,
(f) Notwithstanding anything to the contrary in the Note or Loan
Documents, NYLIC shall have the right, at its sole option, upon
fifteen (15) days prior written notice to Borrower, with or without
cause and irregardless of
2
<PAGE> 3
whether an event of default shall exist or not, to accelerate
repayment of the Loan in full and demand Borrower repay the Loan
in full.
2. The Loan Documents are amended by deleting all references to the
maturity date of "October 10, 1998" and substituting in lieu thereof the
maturity date of May 10, 1999.
3. The principal balance due and owing under the Loan Documents as of the
date hereof, after giving effect to Borrower's payment of all principal payments
required to be paid hereunder, is $1,410,217.91.
4. The Borrower represents and warrants that, at the time of the execution
and delivery of this Agreement, Borrower has good and absolute title to the real
property encumbered by the Loan Documents, and has full power and authority to
subject the same to the lien of the Loan Documents and the same is free and
clear of all liens, charges and encumbrances whatsoever, except those created by
the Loan Documents or those known to NYLIC and those set forth in NYLIC's
existing title insurance policy for the Loan (the "Title Policy").
5. Except as otherwise modified hereby, the terms and provisions of the
Loan Documents shall remain in full force and effect.
6. As a condition precedent to NYLIC's agreement herein:
(a) upon the execution of this Agreement, Borrower shall pay all costs
and expenses, including but not limited to attorney's fees,
recording fees and title charges incurred in connection with this
Agreement and/or the consummation of the transaction contemplated
hereby together with all costs and expenses of NYLIC, including
without limitation, all attorney's fees and expenses incurred as a
result of Borrower's failure to pay the amounts due under the Loan
on or before October 10, 1998; provided, however, Borrower shall
not be required to pay any amounts in excess of those limits
agreed to by Borrower and NYLIC in that certain letter agreement
dated November 24, 1998.
(b) no default shall exist under the Loan Documents as of the date
hereof nor shall any event have occurred which with the passage of
time or the giving of notice, or both, would constitute such a
default;
(c) on or before November 30, 1998, NYLIC shall have received (i) a
payment in the amount of $18,320.16 representing the installment
of principal and accrued interest due on October 10, 1998 and late
charges in the amount of $79.23; (ii) an additional payment of
$11,670.27 representing accrued interest through November 10, 1998
and the required escrow deposit due for such date; and, (iii) the
escrow shortage in the amount of $10,807.28;
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<PAGE> 4
(d) on or before December 21, 1998, Borrower shall provide or cause to
be provided to NYLIC an independent title report opining that
there are no matters of record filed subsequent to the effective
date of Lender's Title Policy except for such matters as are
expressly approved by NYLIC in its discretion.
7. Borrower and NYLIC agree that it is the intent of the parties that the
execution of this Agreement or any documents as contemplated by this Agreement
or the consummation of any transactions contemplated by this Agreement shall
constitute a modification, restatement and renewal under the Loan and shall not
be construed as a novation.
8. By executing this Agreement, Borrower is reconfirming the accuracy and
correctness of all representations contained in the Loan Documents.
9. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original, but all of which shall constitute one
and the same instrument, and in making proof of this Agreement, it shall not be
necessary to produce or account for more than one such counterpart.
10. Borrower hereby agrees that NYLIC, and its officers, directors,
employees and agents are irrevocably and unconditionally released and discharged
of any and all claims, demands, obligations, liabilities, costs and expenses,
now existing (including, without limitation, any obligations or commitment of
NYLIC to provide any financial accommodations to Borrower under the Loan
Documents) arising out of or related to the Loan Documents.
[THE REST OF THIS PAGE HAS BEEN LEFT BLANK]
4
<PAGE> 5
IN WITNESS WHEREOF, the parties have executed this Agreement as of this
21st day of December, 1998 to be effective as of October 10, 1998.
WITNESSES AS TO BORROWER: BORROWER:
BRUNNER COMPANIES INCOME
PROPERTIES, L.P.I, as successor in
interest to DAYTON & ASSOCIATES XII
(SEAL)
By: Brunner Management, LP
As Its: General Partner
By: /s/
---------------------------
Name: Frank B. Turner, Jr.
--------------------------
Its: Authorized Agent
---------------------------
/s/
- -------------------
/s/ Sharon O. Allen
- -------------------
5
<PAGE> 6
IN WITNESS WHEREOF, the parties have executed this Agreement as of this
21st day of December, 1998 to be effective as of October 10, 1998.
WITNESSES AS TO NYLIC: NYLIC:
NEW YORK LIFE INSURANCE COMPANY
(SEAL)
By: /s/
----------------------------
Name: Michael J. Falabella
---------------------------
Its: Real Estate Vice President
----------------------------
/s/
- -------------------
/s/
- -------------------
6
<PAGE> 7
STATE OF GEORGIA )
) PROBATE
COUNTY OF RICHMOND )
PERSONALLY appeared before me the undersigned witness and made oath that
s/he saw the within-written Brunner Companies Income Properties, L.P.I., as
successor in interest to Dayton & Associates XII by Frank B. Turner, Jr. , its
Authorized Agent, sign, seal, and as its act and deed, deliver the
within-written instrument for the uses and purposes therein mentioned, and that
s/he with the other witness whose signature appears above, witnessed the
execution thereof.
/s/
---------------------------
Witness
SWORN TO before me this
17th day of December, 1998.
/s/ Sharon O. Allen
- ----------------------(L.S.)
Notary Public for Georgia
My commission Expires: 8/20/02
7
<PAGE> 8
STATE OF GEORGIA )
) PROBATE
COUNTY OF ________ )
PERSONALLY appeared before me the undersigned witness and made oath that
s/he saw the within-written New York Life Insurance Company, by Michael J.
Falabella, its Real Estate Vice President, sign, seal, and as its act and
deed, deliver the within-written instrument for the uses and purposes therein
mentioned, and that s/he with the other witness whose signature appears above,
witnessed the execution thereof.
/s/
---------------------------
Witness
SWORN TO before me this
__ day of December, 1998.
/s/
- ----------------------(L.S.)
Notary Public for New York
My commission Expires: ____
8
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<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<CASH> (80,000)
<SECURITIES> 0
<RECEIVABLES> 342,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 822,000
<PP&E> 25,066,000
<DEPRECIATION> 7,033,000
<TOTAL-ASSETS> 18,943,000
<CURRENT-LIABILITIES> 118,000
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 829,000
<TOTAL-LIABILITY-AND-EQUITY> 18,943,000
<SALES> 2,842,000
<TOTAL-REVENUES> 2,842,000
<CGS> 0
<TOTAL-COSTS> 2,922,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (80,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (80,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (80,000)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
