SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT
- ---
OF 1934
For the fiscal year ended December 31, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from ................... to ..................
Commission File Number
33-22976-NY
----------------------
INTERVEST CORPORATION OF NEW YORK
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
New York 13-3415815
- ------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10 Rockefeller Plaza, New York, New York 10020-1903
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 757-7300
-----------------------------
Securities Registered Pursuant to Section 12(b) of the Act:
None
----------------
(Title of Class)
Securities Registered Pursuant to Section 12(g) of the Act:
None
----------------
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES (X) NO _______
Indicate by check mark if disclosure of delinquent filers pursuant to item 405
of Regulation SK is not contained herein, and will not be contained, to the best
of Registrant's knowledge in definitive proxy or information statements
incorporated by reference in Part III to this Form 10-K or any amendment to this
Form 10-K (X) .
As of February 29, 1997 there were 31.84 shares of the Registrant's common stock
outstanding.
<PAGE>
TABLE OF CONTENTS
<TABLE>
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PART I
Pages
<S> <C> <C> <C>
Item 1 Description of Business 3
Item 2 Properties 7
Item 3 Legal Proceedings 7
Item 4 Submission of Matters to a Vote of Security Holders 7
PART II
Item 5 Market for the Registrant's Shares and Related Stockholder Matters 8
Item 6 Selected Financial Data 9
Item 7 Management's Discussion and Analysis of Financial Condition and Results of 10
Operations
Item 8 Financial Statements and Supplementary Data 13
Item 9 Changes in and Disagreements with Accountants on Accounting and Financial 28
Disclosure
PART III
Item 10 Directors and Executive Officers of the Registrant 28
Item 11 Executive Compensation 29
Item 12 Security Ownership of Certain Beneficial Owners and Management 29
Item 13 Certain Relationships and Related Transactions 30
PART IV
Item 14 Exhibits, Financial Statement Schedules and Reports on Form 8-K 30
SIGNATURES 33
Supplemental Information to be Furnished with Reports Filed Pursuant to Section 34
15(d) of the Act.
</TABLE>
2
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PART I
Item 1. Description of Business
Intervest Corporation of New York (the "Company") was formed in April 1987 by
Lowell S. Dansker, Lawrence G. Bergman and Helene D. Bergman for the purpose of
engaging in the real estate business, including the acquisition and purchase of
real estate mortgage loans.
The principal offices of the Company are located at 10 Rockefeller Plaza, Suite
1015, New York, New York 10020-1903, and its telephone number is 212-757-7300.
The Company presently has no employees; and only one of its officers serves with
compensation. It presently owns mortgages on real estate, and intends to acquire
and originate additional mortgages on real estate. The Company may in the future
engage in any aspect of the real estate and mortgage finance business.
The Company also has two wholly-owned subsidiaries.
Present Business
The Company owns a portfolio of mortgages on improved real property. The
aggregate outstanding principal balance at December 31, 1996 due on such
mortgages is approximately $70,601,000 ($69,699,000 after adjusting for a
discount of $902,000). The company has in the past and may in the future own
"wraparound mortgages" under which the principal amount of and debt service on
one or more senior mortgages is included within the principal amount of and debt
service on the wraparound mortgage. The holder of the wraparound mortgage is
required to pay the obligations due under such senior mortgages from the
payments which it receives on the wraparound mortgage.
For financial statement reporting purposes, all mortgages contributed or sold to
the Company by affiliates have been recorded at the historical cost of the
affiliate. The historical cost of the mortgage loans which originated in
connection with the sale of real estate includes a discount to reflect an
appropriate market interest rate at the date of origination.
Five mortgages owned by the Company are senior mortgages on net leased, free
standing commercial properties, thirty-five are senior mortgages on multifamily
residential apartment buildings, six are junior mortgages on multifamily
residential apartment buildings, one is a senior mortgage on land, two are
senior mortgages on office buildings and three are participations in first
mortgages on commercial properties. Five of the properties are commercial
properties which are located in various states, and each is leased by the
respective owner to a single commercial tenant under a long term net lease.
Thirty-one of the residential properties are located in New York City, four are
located in suburbs of New York City, five are located in the State of New Jersey
and one is located in the State of Pennsylvania. One of the Company's mortgages
is a blanket mortgage covering several residential properties located in
Philadelphia, Pennsylvania. Three of the residential properties are owned by
cooperative corporations (a form of owner-occupied apartment ownership in New
York City). Thirty-eight of the residential properties are rental properties,
nine of which have commercial space (stores) on the ground floor. Thirty-two of
the Company's mortgages on these properties are first mortgages, and six are
junior mortgages. Three of the mortgages are participations in first mortgages
on commercial properties in Florida. One of the mortgages is a first mortgage on
land located in the State of Florida.
Future Business Operations
The Company plans to engage in the real estate business, including the
acquisition and origination of additional mortgages in the future. Such
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additional mortgages may be purchased from affiliates of the Company or from
unaffiliated parties. It is anticipated that such mortgages will be acquired or
originated using the proceeds of offerings of the Company's debt securities
and/or internally generated funds.
The Company intends to continue to originate new mortgages, to acquire existing
mortgages, and to acquire equity interests in real property. In originating new
mortgages, the Company intends to act as a lender of money to owners of equity
interests in real property. The Company acquired certain existing mortgages from
mortgagees after it commenced business and intends to acquire additional
existing mortgages from mortgagees in the future. The Company does not presently
own any equity interests in real property nor has it acquired such an equity
interest in real property since the date it commenced business. However, the
Company may purchase equity interests in real property in the future or it may
acquire such an equity interest pursuant to a foreclosure upon a mortgage held
by it.
The Company's mortgage loans may include: (i) first mortgage loans; (ii) junior
mortgage loans; and (iii) wraparound mortgage loans.
The Company's mortgage loans will generally be secured by income-producing
properties. In determining whether to make mortgage loans, the Company will
analyze relevant real property and financial factors which may in certain cases
include such factors as the condition and use of the subject property, its
income-producing capacity and the quality, experience and creditworthiness of
the owner of the property. The Company's mortgage loans will generally not be
personal obligations of the borrower and will not be insured or guaranteed by
governmental agencies or otherwise. The Company may make both long- and
short-term mortgage loans. The Company anticipates that generally its mortgage
loans will provide for balloon payments due at the time of their maturity.
With respect to the acquisition of equity interests in real estate, the Company
may acquire and retain title to properties or, may, directly or through a
subsidiary, retain an interest in a partnership formed to acquire and hold title
to real property.
While no such transactions are presently pending, the Company would, in
appropriate circumstances, consider the expansion of its business through
investments in or acquisitions of other companies engaged in real estate or
mortgage business activities.
Real Estate Investment Policies
While the Company has not previously made acquisitions of real property or
managed income-producing property, its management has had substantial experience
in the acquisition and management of properties and, in particular, multifamily
residential properties. The executive officers of the Company have been actively
involved in such activities for many years. (See "Item 10").
Real property that may be acquired will be selected by management of the
Company. The Board of Directors of the Company has not adopted any formal
policies regarding the percentage of the Company's assets that may be invested
in any single property, or in any type of property, or regarding the geographic
location of properties that may be acquired. No vote of any securities holders
of the Company is necessary for any investment in real estate.
The Company anticipates that any equity interests it may acquire will be in
commercial, income-producing properties, primarily multifamily residential
properties located in the New York metropolitan area. The acquisition of real
estate may be financed in reliance upon working capital, mortgage financing or a
combination of both. It is anticipated that properties selected for acquisition
would have potential for appreciation in value. While such properties would
typically generate cash flow from rentals, it is anticipated that income from
properties will generally be reinvested in capital improvements to the
properties.
While the Company would maintain close supervision over any properties that it
may own, independent managing agents may be engaged when deemed appropriate by
4
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management. All such properties would, as a matter of policy, be covered by
property insurance in amounts deemed adequate in the opinion of management.
Mortgage Investment Policy
Future investments in mortgages will be selected by management of the Company.
The Board of Directors of the Company has not adopted any formal policy
regarding the percentage of the Company's assets which may be invested in any
single mortgage, or in any type of mortgage investment, or regarding the
geographic location of properties on which the mortgages owned by the Company
are liens. However, it is the present intention of the management of the Company
to maintain the diversification of the portfolio of mortgages owned by the
Company. No vote of any security holders of the Company is necessary for any
investment in a mortgage.
The Company anticipates that it will acquire or originate senior and junior
mortgages, primarily on multifamily residential properties located in the New
York metropolitan area. The Company anticipates that the amount of each mortgage
it may acquire in the future will not exceed 85% of the fair market value of the
property securing such mortgage. Such mortgages generally will not be insured by
the Federal Housing Administration or guaranteed by the Veterans Administration
or otherwise guaranteed or insured in any way. The Company requires that all
mortgaged properties be covered by property insurance in amounts deemed adequate
in the opinion of management. The Company also acquires or originates mortgages
which are liens on other types of properties, including commercial and office
properties, and may resell mortgages.
Temporary Investment by Affiliates on Behalf of the Company
An affiliate of the Company may make a mortgage loan or purchase a mortgage in
its own name and temporarily hold such investment for the purpose of
facilitating the making of an investment of the Company, provided that any such
investment is acquired by the Company at a cost no greater than the cost of such
investment to the affiliate plus carrying costs and provided there is no other
benefit to the affiliate arising out of such transaction.
Certain Characteristics of the Company's Mortgage Investments
Mortgages typically provide for periodic payments of interest and, in some
cases, principal during the term of the mortgage, with the remaining principal
balance and any accrued interest due at the maturity date. The majority of the
mortgages owned by the Company provide for balloon payments at maturity, which
means that a substantial part or all of the original principal of the mortgage
is due in one lump sum payment at maturity. The property on which the mortgage
is a lien provides the security for the mortgage. If the net revenue from the
property is not sufficient to make all debt service payments due on mortgages on
the property, or if at maturity or the due date of any balloon payment the owner
of the property fails to raise the funds to make the payment (by refinancing,
sale or otherwise), the Company could sustain a loss on its investment in the
mortgage. To the extent that the aggregate net revenues from the Company's
mortgage investments are insufficient to provide funds equal to the payments due
under the Company's debt obligations, then the Company would be required to
utilize its working capital for such purposes or otherwise obtain the necessary
funds from outside sources. No assurance can be given that such funds would be
available to the Company.
With respect to any wraparound mortgages which may be originated by the Company
in the future, such wraparound mortgages are generally negotiated and structured
on an individual, case by case basis, and may be structured to include any or
all of the following provisions:
(i) The Company may lend money to a real property owner who would be
obligated to repay the senior underlying mortgage debt as well as
the new wraparound indebtedness owed to the Company.
(ii) The Company may legally assume the obligation to make the payments
due on the senior underlying mortgage debt.
(iii) The real property owner-debtor may agree to make payments to the
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Company in satisfaction of both the senior underlying mortgage
debt and the new wraparound indebtedness owed to the Company.
(iv) The Company may receive a mortgage on the real property to secure
repayment of the total amount of indebtedness (wraparound
indebtedness and the senior underlying mortgage indebtedness).
The mortgages owned by the Company that are junior mortgages are
subordinate in right of payment to senior mortgages on the various properties.
In all cases, in the opinion of management, the current value of the underlying
property collateralizing the mortgage loan is in excess of the stated amount of
the mortgage loan. Therefore, in the opinion of management of the Company, each
property on which a mortgage owned by the Company is a lien constitutes adequate
collateral for the related mortgage loan. Accordingly, in the event the owner of
a property fails to make required debt service payments, management believes
that, based upon current value, upon a foreclosure of the mortgage and sale of
the property, the Company would recover its entire investment. However, there
can be no assurance that the current value of the underlying property will be
maintained.
Loan Loss Experience
For financial reporting purposes, the Company considers a loan as delinquent or
non-performing when it is contractually past due 90 days or more as to principal
or interest payments. To date, the Company has only experienced a single default
or delinquency in its mortgage portfolio. It is pursuing foreclosure proceedings
with respect to a single mortgage, the principal balance of which is $1,583,700.
The Company evaluates its portfolio of mortgage loans on an individual basis,
comparing the amount at which the investment is carried to its estimated net
realizable value. Since the Company has experienced only a single default or
delinquency, no allowance for loan losses is presently maintained.
Tax Accounting Treatment of Payments Received on Mortgages
The Company derives substantially all of its cash flow from debt service
payments which it receives on mortgages owned by it. The tax accounting
treatment of such debt service payments, as income or return of capital, depends
on the particular mortgage. In the case of mortgages which pay interest only,
the entire debt service payment prior to maturity received by the Company is
treated as income and the repayment of principal is generally considered a
return of capital. In the case of mortgages which include amortization of
principal in the debt service payment received by the Company, the amount
representing amortization of principal is generally treated as a return of
capital for tax accounting purposes. However, the Company will report $199,000
of additional taxable income upon the collection of $875,000 of principal
applicable to five mortgages due to deferrals of taxable income in connection
with prior real estate transactions.
Financial Accounting Treatment of Payments Received on Mortgages
For financial reporting purposes, the Company's basis in mortgages originated in
connection with real estate sale transactions is less than the face amount
outstanding. This difference is attributable to discounts recorded by the
Company to reflect a market rate of interest at the date the loans were
originated. These discounts will be amortized over the lives of the mortgages.
Effect of Government Regulation
Investment in mortgages on real properties presently may be impacted by
government regulation in several ways. Residential properties may be subject to
rent control and rent stabilization laws. As a consequence, the owner of the
property may be restricted in its ability to raise the rents on apartments. If
real estate taxes, fuel costs and maintenance of and repairs to the property
were to increase substantially, and such increases are not offset by increases
in rental income, the ability of the owner of the property to make the payments
due on the mortgage as and when they are due might be adversely affected.
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Laws and regulations relating to asbestos have been adopted in many
jurisdictions, including New York City, which require that whenever any work is
undertaken in a property in an area in which asbestos is present, the asbestos
must be removed or encapsulated in accordance with such applicable local and
federal laws and regulations. The cost of asbestos removal or encapsulation may
be substantial, and if there were not sufficient cash flow from the property,
after debt service on mortgages, to fund the required work, and the owner of the
property fails to fund such work from other sources, the value of the property
could be adversely affected, with consequent impairment of the security for the
mortgage.
Laws regulating the storage, disposal and clean up of hazardous or toxic
substances at real property have been adopted at the federal, state and local
levels. Such laws may impose a lien on the real property superior to any
mortgages on the property. In the event such a lien were imposed on any property
which serves as security for a mortgage owned by the Company, the security for
such mortgage could be impaired.
Indemnification
Pursuant to the bylaws of the Company, the Company is obligated to indemnify
officers and directors of the Company against judgments, fines, amounts paid in
settlement and reasonable expenses, including attorneys' fees, actually and
necessarily incurred by such officers or directors as a result of any action or
proceeding, or any appeal therein, to the extent such indemnification is
permitted under the laws of the State of New York (in which the Company is
incorporated). Insofar as indemnification for liabilities under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling the
Company pursuant to the foregoing provisions, the Company has been informed
that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Securities Act of
1933 and is therefore unenforceable.
Item 2. Properties
None.
Item 3. Legal Proceedings
Except with respect to foreclosure proceedings related to one of its mortgages,
the Company is not engaged in any litigation, nor does it presently know of any
threatened or pending litigation in which it is contemplated that the Company
will be made a party.
Item 4. Submission of Matters to a Vote of Security Holders
None.
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PART II
Item 5. Market for the Registrant's Shares and Related Stockholder Matters
There is no established trading market for the Company's shares of common stock.
As of February 29, 1997, there were four recordholders of the Company's shares
of common stock. In the two most recent fiscal years, no cash dividends were
declared or paid with respect to the Company's common stock.
8
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<TABLE>
<CAPTION>
Item 6. Selected Financial Data
Income Statement Data
Year Ended December 31,
-----------------------
1996 1995 1994 1993 1992
---------- ----------- ----------- ----------- --------
Revenue
<S> <C> <C> <C> <C> <C>
Interest income.............. $ 9,497,000 $ 7,984,000 $ 6,368,000 $ 4,337,000 $ 3,345,000
Other income 372,000 332,000 283,000 802,000 735,000
Gain on early repayment of
discounted mortgage receivable 282,000 82,000 17,000 18,000 20,000
----------- ----------- ----------- ----------- -----------
$10,151,000 $8,398,000 $6,668,000 $5,157,000 $4,100,000
----------- ---------- ---------- ---------- ----------
Expenses
Interest......................... $7,053,000 $6,227,000 $4,591,000 $3,415,000 $2,904,000
General and administrative 948,000 657,000 483,000 188,000 194,000
Amortization of deferred
bond offering costs....... 869,000 748,000 655,000 529,000 460,000
---------- ---------- ---------- ---------- ----------
$8,870,000 $7,632,000 $5,729,000 $4,132,000 $3,558,000
---------- ---------- ---------- ---------- ----------
Income Before Income Taxes $1,281,000 $ 766,000 $ 939,000 $1,025,000 $ 542,000
Provision for Income Taxes 584,000 324,000 403,000 480,000 229,000
----------- ---------- ---------- ---------- ----------
Net Income...................... $ 697,000 $ 442,000 $ 536,000 $ 545,000 $ 313,000
=========== ========== ========== ========== ==========
Ratio of Earnings to Fixed
Charges (1)................... 1.2 1.1 1.2 1.3 1.2
-----------
(1) The actual ratio of earnings to fixed charges has been computed by
dividing earnings (before state and federal taxes and fixed charges) by
fixed charges. Fixed charges consist of interest incurred during the
period and amortization of deferred debenture offering costs.
</TABLE>
<TABLE>
<CAPTION>
Balance Sheet Data
December 31
-----------
1996 1995 1994 1993 1992
------------ ------------- -------------- -------------- --------
<S> <C> <C> <C> <C> <C>
Mortgages receivable.......... $69,699,000 $55,146,000 $56,666,000 $41,521,000 $32,493,000
Total assets...................... 92,223,000 77,579,000 64,745,000 54,650,000 45,140,000
Long term obligations......... 79,006,000 66,850,000 54,427,000 45,239,000 36,584,000
Stockholders' equity........... 10,075,000 9,378,000 8,936,000 8,400,000 7,855,000
</TABLE>
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Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources:
The Company is engaged in the real estate business, including the origination
and purchase of real estate mortgage loans, consisting of first mortgage, junior
mortgage and wraparound mortgage loans. The Company's current investment policy
emphasizes the investment in mortgage loans on income producing properties. The
majority of the Company's loans are expected to mature within approximately five
years.
The Company's liquidity is managed to ensure that sufficient funds are available
to meet maturities of borrowings or to make other investments, taking into
account anticipated cash flows and available sources of funds. The Company's
principal sources of funds have consisted of borrowings (principally through the
issuance of its subordinated debentures), mortgage repayments and cash flow from
ongoing operations. Total stockholders' equity at December 31, 1996 was
$10,075,000. The Company considers its current liquidity and additional sources
of funds sufficient to satisfy its outstanding commitments and its maturing
liabilities.
Results of Operations:
Year Ended December 31, 1996 and 1995
Interest Income for 1996 was $9,497,000 as compared to $7,984,000 for 1995. The
increase of $1,513,000 resulted mainly from an increase in mortgages receivable,
offset in part by a decrease in interest rates subsequent to July 1995. Interest
paid by the Company on its debentures, as well as the interest earned on many of
its mortgages, is keyed to the prime rate, which was 8 1/2% at December 31,
1995, and decreased to 8 1/4% on February 1, 1996.
Interest expense for the 1996 period was $7,053,000 as compared to $6,227,000
for the 1995 period. The increase of $826,000 resulted mainly from an increase
in long term obligations, offset in part by a decrease in interest rates
subsequent to July 1995.
General and administrative expenses for 1996 was $948,000 as compared to
$657,000 for 1995. The increase of $291,000 resulted mainly from the payment of
an officer's salary and increased advertising expenses.
The provision for income taxes are $584,000 and $324,000 for 1996 and 1995,
respectively. These provisions represent 46% and 42% of pretax income for each
period.
Year Ended December 31, 1995 and 1994
Interest income for 1995 was $7,984,000 as compared to $6,368,000 for 1994. The
increase of $1,616,000 resulted mainly from a higher level of mortgages
receivable, together with an increase in interest rates in 1995. Mortgages
receivable were: $56,666,000 at December 31, 1994, $59,612,000 at March 31,
1995, $59,457,000 at June 30, 1995, $56,145,000 at September 30, 1995 and
$55,146,000 at December 31, 1995. Interest paid by the Company on its debentures
as well as the interest earned on many of its mortgages, is keyed to the prime
rate, which varied from time to time during 1995, from 8 1/2% at December 31,
1994 to a high of 9% and then returning to 8 1/2% at December 31, 1995.
Interest expense for the 1995 period was $6,227,000 as compared to $4,591,000
for the 1994 period. The increase of $1,636,000 resulted mainly from an increase
in long term obligations from $54,427,000 at December 31, 1994 to $66,850,000 at
December 31, 1995 and an increase in interest rates in 1995.
General and administrative expenses for 1995 was $657,000 as compared to
$483,000 for 1994. The increase of $174,000 resulted mainly from an increase in
payroll and office rental expenses.
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The provision for income taxes decreased from $403,000 in 1994 to $324,000 in
1995. These provisions represent 43% and 42% of pretax income for each period.
Since the Company intends to continue to expand its asset base, including its
mortgage portfolio, it is anticipated that its interest income will continue to
grow. To the extent that such growth is funded in reliance upon long-term
obligations, interest expense will likewise increase. The size of any such
increase will, of course, depend upon the principal amounts of the additional
assets or liabilities, as well as interest rates.
Since the Company is engaged in the real estate business, its results of
operations are affected by general economic trends in real estate markets, as
well as by trends in the general economy and the movement of interest rates.
Since the properties underlying the Company's mortgages are concentrated in the
New York City area, the economic condition in that area can also have an impact
on the Company's operations.
The number of instances of prepayment of mortgage loans tends to increase during
periods of declining interest rates and tends to decrease during periods of
increasing interest rates. Certain of the Company's mortgages include prepayment
provisions, and others prohibit prepayment of indebtedness entirely. In any
event, the Company believes that it would be able to reinvest the proceeds of
any prepayments of mortgage loans in comparable mortgages so that prepayments
would not have any materially adverse effect on the Company's business.
The rental housing market in New York City remains stable and the Company
expects that such properties will continue to appreciate in value with little or
no reduction in occupancy rates. The Company's mortgage portfolio is composed
predominantly of mortgages on multi-family residential properties, most of which
are subject to applicable rent control and rent stabilization statutes and
regulations. In both cases, any increases in rent are subject to specific
limitations. As such, properties of the nature of those constituting the most
significant portion of the Company's mortgage portfolio are not affected by the
general movement of real estate values in the same manner as other
income-producing properties.
The Company's mortgages are generally acquired or originated for investment and
not for resale in the secondary market, and it is, in general, the Company's
intention to hold such mortgages to maturity. The Company's mortgage loans
generally do not meet the criteria set forth by relevant federal agencies, and
as a result are not readily marketable in the secondary market.
Impact of Inflation:
The Company may lend at fixed interest rates that exceed the rates applicable,
from time to time, to the Debentures payable by the Company. Under such
circumstances inflation has not had a material effect on the Company's
continuing operations. Should inflation result in rising interest rates, the
Company would have to devote a higher percentage of the interest payments it
receives from its fixed rate mortgages to meet the interest payments due on the
Debentures. The extent to which the Company may be required to allocate the
interest payments it receives to the payment of the interest due on the
Debentures as a result of increasing interest rates is limited because the
interest payable on both principal and accrued interest on the Debentures may
not exceed a certain maximum percent per annum. Should the Company be required
to pay the maximum interest payable on the Debentures, the Company may be
required to use its working capital for purposes of interest payments.
Business:
The Company is engaged in the real estate business and has historically invested
primarily in real estate mortgage loans secured by income producing real
property. Such transactions typically require an understanding of the underlying
real estate transaction and rapid processing and funding as a principal basis
for competing in the making of these loans. The Company does not finance new
construction.
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At December 31, 1996, 60% of the outstanding principal amount of the Company's
loans (net of discounts) were secured by properties located in the greater New
York metropolitan area. The balance of the Company's loans are secured by
properties located in Florida, Georgia, New Jersey, upstate New York,
Pennsylvania and Virginia.
Certain of the Company's real estate mortgage loans bear interest at a fixed
rate. The balance of such loans bear interest at fluctuating rates. As of
December 31, 1996, approximately 35% of the Company's mortgage portfolio was
comprised of fixed rate mortgages. Interest on the loans is usually payable
monthly.
At December 31, 1996, the Company's portfolio consisted of 52 real estate
mortgage loans totaling $70,601,000 in the aggregate face principal amount
($69,699,000 in carrying amount for financial reporting purposes, the difference
representing unearned discounts). Of the principal amount of real estate loans
outstanding at December 31, 1996, 89% represent first mortgage loans and 11%
represent junior mortgage loans.
The Company may also, from time to time, acquire interests in real property,
including fee interests.
Investment Policy-Operations:
The Company's current investment policy related to mortgages emphasizes
investments in real estate mortgages secured by income producing real property,
located primarily in the greater New York metropolitan area.
The properties to be mortgaged are personally inspected by management and
mortgage loans are made only on those properties where management is
knowledgeable as to operating income and expense. The Company generally relies
upon its management in connection with the valuation of properties. From time to
time, however, it may engage independent appraisers and other agents to assist
in determining the value of income-producing properties underlying mortgages, in
which case the costs associated with such services are generally paid by the
mortgagor.
The Company's current investment policy related to real estate acquisitions
emphasizes investments in income-producing properties located primarily in the
New York metropolitan area.
Current Loan Status:
At December 31, 1996, the Company had 52 real estate loans in its portfolio,
totaling $70,601,000 (face amount) in aggregate principal amount. Interest rates
on the mortgage portfolio range between 6% and 24% per annum. Certain mortgages
have been discounted utilizing rates between 12% and 18% per annum.
Certain information concerning the Company's mortgage loans outstanding at
December 31, 1996 is set forth below:
<TABLE>
<CAPTION>
Carrying
Amount of No. of
Mortgage Prior Liens Loans
-------- ----------- -----
<S> <C> <C> <C>
First Mortgage Loans................................ $62,013,000 $ 0 46
Junior Mortgages..................................... 7,686,000 20,983,000 6
----------- ----------- --
$69,699,000 $20,983,000 52
=========== =========== ==
</TABLE>
The historical cost of the mortgage loans which originated in connection with
the sale of real estate includes a discount to reflect an appropriate market
interest rate at the date of origination.
12
<PAGE>
Competition:
The Company competes for acceptable investments with real estate investment
trusts, commercial banks, insurance companies, savings and loan associations,
pension funds and mortgage banking firms, many of which have greater resources
with which to compete for desirable mortgage loans.
<TABLE>
<CAPTION>
Item 8. Financial Statements and Supplementary Data Pages
<S> <C>
Report of Independent Auditors -- 1996 and 1995.................................................................... 14
Consolidated Balance Sheets as of December 31, 1996 and 1995....................................................... 15
Consolidated Statements of Operations and Retained Earnings
for the Years Ended December 31, 1996, 1995 and 1994......................................................... 16
Consolidated Statements of Cash Flows for the Years Ended December 31, 1996, 1995 and 1994......................... 17
Notes to Financial Statements...................................................................................... 18
Schedule IV -- Mortgage Loans on Real Estate -- December 31, 1996.................................................. 25
</TABLE>
Other financial statement schedules and inapplicable periods with respect to
schedules listed above are omitted because the conditions requiring their filing
do not exist or the information required thereby is included in the financial
statements filed, including the notes thereto.
13
<PAGE>
REPORT OF INDEPENDENT AUDITORS
Board of Directors and Stockholders
Intervest Corporation of New York
New York, New York
We have audited the accompanying consolidated balance sheets of
Intervest Corporation of New York and subsidiaries as at December 31, 1996 and
December 31, 1995, and the related consolidated statements of operations and
retained earnings and cash flows for each of the years in the three-year period
ended December 31, 1996 and Schedule IV. These financial statements and related
schedule are the responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements and related schedule
based on our audits.
We conducted our audits 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 and related schedule
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 management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements enumerated above present
fairly, in all material respects, the consolidated financial position of
Intervest Corporation of New York and subsidiaries at December 31, 1996 and
December 31, 1995, and the consolidated results of their operations and their
consolidated cash flows for each of the years in the three-year period ended
December 31, 1996 in conformity with generally accepted accounting principles.
Further, it is our opinion that the schedule referred to above presents fairly,
in all material respects, the information set forth therein in compliance with
the applicable accounting regulation of the Securities and Exchange Commission.
Richard A. Eisner & Company, LLP
New York, New York
January 22, 1997
- 14 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
December 31,
------------
A S S E T S 1996 1995
------------- ---- ----
<S> <C> <C>
Cash and cash equivalents . . . . . . . . . . . . . . . . . $16,911,000 $17,670,000
Mortgages receivable, including due from affiliates of
$6,250,000 in 1996 and 1995 (Notes 2, 4 and 5) . . . . . 69,699,000 55,146,000
Deferred debenture offering costs, net of accumulated
amortization of $2,262,000 and $2,343,000 (Note 2) . . . 4,475,000 3,865,000
Other assets (Note 7) . . . . . . . . . . . . . . . . . . . 1,138,000 898,000
----------- -----------
T O T A L . . . . . . . . . . . . . . . . . . . . $92,223,000 $77,579,000
=========== ===========
L I A B I L I T I E S
Accounts payable and accrued expenses . . . . . . . . . . . $ 406,000 $ 64,000
Mortgage escrow deposits . . . . . . . . . . . . . . . . . 2,356,000 1,021,000
Mortgage payable . . . . . . . . . . . . . . . . . . . . . 18,000
Subordinated debentures payable (Note 3) . . . . . . . . . 75,500,000 64,700,000
Debenture interest payable at maturity (Note 3) . . . . . . 3,506,000 2,132,000
Deferred mortgage interest and fees . . . . . . . . . . . . 380,000 266,000
----------- -----------
Total liabilities . . . . . . . . . . . . . . . . 82,148,000 68,201,000
----------- -----------
Commitments and other matters (Note 6)
STOCKHOLDERS' EQUITY
Common stock, no par value; authorized 200 shares; issued
and outstanding 32 shares . . . . . . . . . . . . . . . 2,000,000 2,000,000
Additional paid-in capital . . . . . . . . . . . . . . . . 3,509,000 3,509,000
Retained earnings . . . . . . . . . . . . . . . . . . . . . 4,566,000 3,869,000
----------- -----------
Total stockholders' equity . . . . . . . . . . . 10,075,000 9,378,000
----------- -----------
T O T A L . . . . . . . . . . . . . . . . . . . . $92,223,000 $77,579,000
=========== ===========
</TABLE>
See notes to financial
statements.
- 15 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
AND RETAINED EARNINGS
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------
1996 1995 1994
---- ---- ----
Revenue:
Interest income:
<S> <C> <C> <C>
Affiliates . . . . . . . . . . . . . . . $ 693,000 $ 985,000 $ 1,262,000
Others . . . . . . . . . . . . . . . . . 8,804,000 6,999,000 5,106,000
----------- ----------- -----------
T o t a l . . . . . . . . . . . . . 9,497,000 7,984,000 6,368,000
Other income (Note 5) . . . . . . . . . . . 372,000 332,000 283,000
Gain on early repayment of discounted
mortgages receivable (Note 4) . . . . . . 282,000 82,000 17,000
----------- ----------- -----------
10,151,000 8,398,000 6,668,000
----------- ----------- -----------
Expenses:
Interest . . . . . . . . . . . . . . . . . 7,053,000 6,227,000 4,591,000
General and administrative (Note 5) . . . . 948,000 657,000 483,000
Amortization of deferred debenture
offering costs (Note 2) . . . . . . . . . 869,000 748,000 655,000
----------- ----------- -----------
8,870,000 7,632,000 5,729,000
----------- ----------- -----------
Income before income taxes . . . . . . . . . . 1,281,000 766,000 939,000
Provision for income taxes (Note 7) . . . . . 584,000 324,000 403,000
----------- ----------- -----------
NET INCOME . . . . . . . . . . . . . . . . . . 697,000 442,000 536,000
Retained earnings - beginning of year . . . . 3,869,000 3,427,000 2,891,000
----------- ----------- -----------
RETAINED EARNINGS - END OF YEAR . . . . . . . $ 4,566,000 $ 3,869,000 $ 3,427,000
=========== =========== ===========
</TABLE>
See notes to financial
statements.
- 16 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------
1996 1995 1994
------ ------ -----
Cash flows from operating activities:
<S> <C> <C> <C>
Net income . . . . . . . . . . . . . . $ 697,000 $ 442,000 $ 536,000
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Amortization of discount on
mortgages receivable . . . . . . (421,000) (255,000) (210,000)
Amortization of deferred debenture
offering costs . . . . . . . . . 869,000 748,000 655,000
Amortization of premium on
municipal bonds . . . . . . . . 13,000
Gain on early repayment of
discounted mortgages . . . . . . (282,000) (82,000) (17,000)
Changes in operating assets and
liabilities:
(Increase) in other assets . . (240,000) (109,000) (167,000)
Increase (decrease) in
accounts payable and accrued
expenses . . . . . . . . . . 342,000 4,000 (171,000)
Increase in mortgage escrow
deposits . . . . . . . . . . 1,335,000 11,000 544,000
Increase (decrease) in
debenture interest payable
at maturity . . . . . . . . 1,374,000 (1,356,000) 1,004,000
Increase (decrease) in
deferred mortgage
interest and fees . . . . . 114,000 (46,000) (2,000)
------------ ------------ ------------
Net cash provided by (used
in) operating activities . 3,788,000 (643,000) 2,185,000
------------ ------------ ------------
Cash flows from investing activities:
Collection of mortgages receivable . . 20,924,000 18,981,000 3,762,000
Mortgages receivable acquired:
Properties owned by affiliates . . . (2,500,000)
Properties owned by others . . . . . (34,774,000) (17,124,000) (16,180,000)
Collection of loans to stockholders . 3,500,000
Principal payments of mortgages
payable . . . . . . . . . . . . . . (18,000) (21,000) (16,000)
Redemption of governmental obligations 985,000 2,655,000
Purchase of governmental obligations . (985,000)
------------ ------------ ------------
Net cash (used in) provided
by investing activities . (13,868,000) 2,821,000 (9,764,000)
------------ ------------ ------------
Cash flows from financing activities:
Proceeds from subordinated debenture
offerings . . . . . . . . . . . . . 17,000,000 20,000,000 10,000,000
Payment of debenture offering costs . (1,479,000) (1,784,000) (946,000)
Redemption of subordinated debentures (6,200,000) (6,200,000) (1,800,000)
------------ ------------ ------------
Net cash provided by
financing activities . . . 9,321,000 12,016,000 7,254,000
------------ ------------ ------------
(DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS . . . . . . . . . . . . . (759,000) 14,194,000 (325,000)
Cash and cash equivalents at beginning of
year . . . . . . . . . . . . . . . . . 17,670,000 3,476,000 3,801,000
------------ ------------ ------------
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 16,911,000 $ 17,670,000 $ 3,476,000
============ ============ ============
</TABLE>
See notes to financial
statements.
- 17 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 1) - The Company:
Intervest Corporation of New York (the "Company") was formed by Lowell
S. Dansker, Lawrence G. Bergman and Helene D. Bergman for the purpose of
engaging in the real estate business, including the acquisition and purchase of
real estate mortgage loans.
(NOTE 2) - Significant Accounting Policies:
[a] Consolidation policy:
The financial statements include the accounts of all
subsidiaries. Material intercompany items are eliminated in consolidation.
[b] Unearned discount:
Unearned discount is amortized over the life of the related
receivables using the constant interest method.
[c] Allowance for possible losses:
Mortgages receivable are valued at the lower of cost or net
realizable value on an individual basis. The Company will recognize an
impairment loss if it determines that the net realizable value of the mortgage
receivable is below cost. This determination is made based upon the mortgagor's
continuing compliance with the terms of the mortgage and management's ability to
assess the operation of the underlying properties and the rental housing market
where such properties are located. For financial reporting purposes mortgages
are deemed to be delinquent when payment of either principal or interest is more
than 90 days past due.
[d] Deferred debenture offering costs:
Costs relating to offerings of debentures are amortized over the
terms of the debentures based on serial maturities. Deferred debenture offering
costs consist primarily of underwriters' commissions.
[e] Statement of cash flows:
For purposes of the statement of cash flows, the Company
considers all highly liquid instruments purchased with an original maturity of
three months or less to be cash equivalents. Interest and income taxes were paid
as follows:
Year Ended
December 31, Interest Income Taxes
------------ -------- ------------
1996 . . . . . . . . $5,679,000 $196,000
1995 . . . . . . . . 7,584,000 331,000
1994 . . . . . . . . 3,586,000 318,000
[f] Estimated fair value of financial instruments:
The Company considers the carrying amounts presented for
mortgages receivable and subordinated debentures payable on the consolidated
balance sheets to be reasonable approximations of fair value. The Company's
variable or floating interest rates on large portions of its receivables and
payables approximate those which would prevail in current market transactions.
Considerable judgement is necessarily required in interpreting market data to
develop the estimates of fair value, and accordingly, the estimates are not
necessarily indicative of the amounts that the Company could realize in a
current market transaction.
(continued)
- 18 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 2) - Significant Accounting Policies: (continued)
[g] 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 reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
[h] Concentration of credit risk:
[1] The Company places its temporary cash investments with
higher credit-quality financial institutions and in governmental obligations.
Such investments are generally in excess of the FDIC insurance limit. The
Company has not experienced any losses from such investments.
[2] The Company's mortgage portfolio is composed predominantly
of mortgages on multi-family residential properties in the New York City area,
most of which are subject to applicable rent control and rent stabilization
statutes and regulations. In both cases, any increases in rent are subject to
specific limitations. As such, properties of the nature of those constituting
the most significant portion of the Company's mortgage portfolio are not
affected by the general movement of real estate values in the same manner as
other income-producing properties. The rental housing market in New York City
remains stable and the Company expects that such properties will continue to
appreciate in value with little or no reduction in occupancy rates.
(continued)
- 19 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 3) - Subordinated Debentures Payable:
The Company's Registered Floating Rate Redeemable Debentures consist of
the following:
December 31,
------------
1996 1995
---- ----
Series 1989, interest at 2% above prime . . $ 1,200,000
Series 10/4/89, interest at 1% above prime. $ 2,000,000 4,000,000
Series 3/28/90, interest at 1% above prime. 2,000,000 4,000,000
Series 5/13/91, interest at 2% above prime. 6,000,000 6,000,000
Series 2/20/92, interest at 2% above prime. 4,500,000 4,500,000
Series 6/29/92, interest at 2% above prime. 7,000,000 7,000,000
Series 9/13/93, interest at 2% above prime. 8,000,000 8,000,000
Series 1/28/94, interest at 1% above prime. 500,000
Series 1/28/94, interest at 2% above prime. 4,500,000 4,500,000
Series 10/28/94, interest at 1% above prime 500,000
Series 10/28/94, interest at 2% above prime 4,500,000 4,500,000
Series 5/12/95, interest at 1% above prime. 1,000,000 1,000,000
Series 5/12/95, interest at 2% above prime. 9,000,000 9,000,000
Series 10/19/95, interest at 1% above prime 1,000,000 1,000,000
Series 10/19/95, interest at 2% above prime 9,000,000 9,000,000
Series 5/10/96, interest at 1% above prime. 1,000,000
Series 5/10/96, interest at 2% above prime. 10,000,000
Series 10/15/96, interest at 1% above prime 500,000
Series 10/15/96, interest at 2% above prime 5,500,000
-----------
$75,500,000 $64,700,000
=========== ===========
"Prime" refers to the prime rate of Chase Manhattan Bank.
Prime was 8 1/4% on December 31, 1996. Minimum interest is 9 1/2% and
maximum interest is 15% on Series 10/4/89, 3/28/90 and 5/13/91. Series 2/20/92
has minimum interest of 8% and maximum interest of 14%, Series 6/29/92 has
maximum interest of 14% and Series 9/13/93, 1/28/94, 10/28/94, 5/12/95,
10/19/95, 5/10/96 and 10/15/96 have maximum interest of 12%.
Payment of interest on an aggregate of $14,930,000 of debentures is
deferred until maturity and earns interest at prime. Any debenture holder who
has deferred receipt of interest may at any time elect to receive the deferred
interest and subsequently receive regular payments of interest.
The debentures may be redeemed, in whole or in part, at any time at the
option of the Company. For debentures issued after 1994, redemption would
generally be at a premium of 1% or 2% if the redemption is prior to 1998.
(continued)
- 20 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 3) - Subordinated Debentures Payable: (continued)
The debentures are unsecured and subordinate to all present and future
senior indebtedness, as defined.
Maturities of debentures are summarized as follows:
Year Ending
December 31,
------------
1997. . . . . . . . . . . . . . . . . . . $ 3,000,000
1998. . . . . . . . . . . . . . . . . . . 4,000,000
1999. . . . . . . . . . . . . . . . . . . 11,000,000
2000. . . . . . . . . . . . . . . . . . . 7,000,000
2001. . . . . . . . . . . . . . . . . . . 8,000,000
Thereafter until 2005 . . . . . . . . . . 42,500,000
-----------
T o t a l . . . . . . . . . . . $75,500,000
===========
(NOTE 4) - Mortgages Receivable:
Information as to mortgages receivable is summarized as follows:
December 31,
------------
1996 1995
---- ----
First mortgages . . . . . . . . $62,914,000 $48,685,000
Junior mortgages. . . . . . . . 7,687,000 6,906,000
Wraparound mortgage . . . . . . 329,000
------------ -----------
70,601,000 55,920,000
Less unearned discount. . . . . 902,000 774,000
------------ -----------
T o t a l . . . . . . . $69,699,000 $55,146,000
============ ===========
Interest rates on mortgages range from 6% to 24%. Certain mortgages have
been discounted utilizing rates ranging from 12% to 18%.
During 1994, 1995 and 1996 certain mortgages were paid in full prior to
their maturity date. This resulted in the recognition of a gain, which
represents the balance of the unamortized discount applicable to these
mortgages.
Maturities of mortgages receivable are summarized as follows:
Year Ending
December 31,
------------
1997. . . . . . . . . . . . . . . . . $22,472,000
1998. . . . . . . . . . . . . . . . . 9,144,000
1999. . . . . . . . . . . . . . . . . 14,292,000
2000. . . . . . . . . . . . . . . . . 2,767,000
2001. . . . . . . . . . . . . . . . . 766,000
Thereafter until 2015 . . . . . . . . 21,160,000
-----------
T o t a l . . . . . . . . . $70,601,000
===========
The Company evaluates its portfolio of mortgage loans on an individual
basis, comparing the amount at which the investment is carried to its estimated
net realizable value. At the respective balance sheet dates, no allowances were
required.
(continued)
- 21 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 5) - Related Party Transactions:
During 1995 and 1994 affiliates sold, to unrelated third parties,
properties subject to mortgages held by the Company. In connection with those
sales, the Company's mortgages in the original aggregate amounts of $6,958,000
and $4,000,000, respectively, were refinanced and the Company received new first
mortgages totaling $9,670,000 and $5,610,000, respectively.
During 1994 a mortgage of $100,000, representing a lien on property
owned by an affiliated company was acquired from a third party. This mortgage
was recorded at cost. In addition, during 1994 the Company made mortgage loans
of $2,400,000 on properties owned by affiliated companies.
Interest income - others includes $120,000 earned on notes receivable
from stockholders in 1994.
Other income includes the following amounts from affiliates:
Year Ended December 31,
-----------------------
1996 1995 1994
---- ---- ----
Real estate sales commissions . . . . $135,000
Mortgage modification fees . . . . . $ 8,000 $ 42,000 121,000
-------- -------- --------
T o t a l . . . . . . . . . $ 8,000 $ 42,000 $256,000
======== ======== ========
The Company utilizes personnel and other facilities of affiliated
entities and is charged service fees for general and administrative expenses for
placing mortgages, servicing mortgages and distributing debenture interest
checks. Such fees amounted to $367,000, $342,000 and $354,000 in 1996, 1995 and
1994, respectively. Management believes these service fees are reasonable.
(NOTE 6) - Commitments:
[a] Office lease:
The Company occupies its office space under a lease which
commenced October 1, 1994 and terminates on September 30, 2004. In addition to
minimum rents the Company is required to pay its proportionate share of
increases in the building's real estate taxes and costs of operation and
maintenance as additional rent. Rent expense amounted to $180,000, $177,000 and
$44,000 for 1996, 1995 and 1994, respectively.
Future minimum rents under the lease are as follows:
1997. . . . . . . . . . . . . . . . . . . $ 157,976
1998. . . . . . . . . . . . . . . . . . . 174,902
1999. . . . . . . . . . . . . . . . . . . 174,902
2000. . . . . . . . . . . . . . . . . . . 179,133
2001. . . . . . . . . . . . . . . . . . . 191,828
Thereafter. . . . . . . . . . . . . . . . 527,527
----------
T o t a l . . . . . . . . . . . $1,406,268
==========
The Company shares this space with affiliates who were charged
rent of $63,000, $77,000 and $12,000 in 1996, 1995 and 1994, respectively.
(continued)
- 22 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 6) - Commitments: (continued)
[b] Employment agreement:
Effective as of July 1, 1995, the Company entered into an
employment agreement with its Executive Vice President, who is related to the
stockholders, for a term of ten years at an annual salary of $125,000, which is
subject to increase annually by six percent or by the percentage increase in the
consumer price index, if higher. In the event of the executive's death or
disability, one-half of this amount will continue to be paid for a term as
defined in the agreement.
(NOTE 7) - Income Taxes:
The Company has provided for income taxes in the periods presented based
on the federal, state and city tax rates in effect for these periods.
The provision for income taxes consists of the following components:
Year Ended December 31,
-----------------------
1996 1995 1994
---- ---- ----
Current taxes:
Federal . . . . . . . . . . . . . $324,000 $143,000 $202,000
State and local . . . . . . . . . 216,000 102,000 164,000
Deferred taxes:
Federal . . . . . . . . . . . . . 26,000 46,000 22,000
State and local . . . . . . . . . 18,000 33,000 15,000
-------- -------- --------
Total tax provision . . . $584,000 $324,000 $403,000
======== ======== ========
Temporary differences exist between financial accounting and tax
reporting which result in a net deferred tax asset, included in other assets, as
follows:
Year Ended December 31,
-----------------------
1996 1995 1994
---- ---- ----
Debenture underwriting commissions . . . $ 19,000 $ 32,000 $ 51,000
Deferred fees and interest . . . . . . . 58,000 68,000 110,000
Discount on mortgages receivable . . . . (70,000) (49,000) (31,000)
--------- --------- ---------
T o t a l . . . . . $ 7,000 $ 51,000 $ 130,000
========= ========= =========
(continued)
- 23 -
<PAGE>
INTERVEST CORPORATION OF NEW YORK
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(NOTE 7) - Income Taxes: (continued)
The amounts of income taxes provided varied from the amounts which would
be "expected" to be provided at the statutory federal income tax rates in effect
for the following reasons:
December 31,
------------
1996 1995 1994
---- ---- ----
Tax computed based upon the
statutory federal tax rate . . . . . . $ 435,000 $ 260,000 $ 319,000
State and local income tax,
net of federal income tax
benefit . . . . . . . . . . . . . . . 158,000 98,000 118,000
Nontaxable income . . . . . . . . . . (9,000) (10,000) (23,000)
Other . . . . . . . . . . . . . . . . (24,000) (11,000)
--------- --------- ---------
T o t a l . . . . . . . . . $ 584,000 $ 324,000 $ 403,000
========= ========= =========
- 24 -
<PAGE>
<TABLE>
<CAPTION>
INTERVEST CORPORATION OF NEW YORK
SCHEDULE IV--MORTGAGE LOANS ON REAL ESTATE
DECEMBER 31, 1996
EFFECTIVE ACTUAL FINAL FACE CARRYING PREPAYMENT
INTEREST INTEREST MATURITY PRIOR AMOUNT OF AMOUNT OF PENALTY/
DESCRIPTION RATE RATE DATE PERIODIC PAYMENT TERMS LIENS MORTGAGES MORTGAGES OTHER FEES
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
COMMERCIAL FIRST MORTGAGES:
OFFICE BUILDINGS:
NEW CITY, NEW YORK 12.25 6.20 12/08/10 PRIN. AND INTEREST ANNUALLY 300,000 147,000 (F)
EATONTOWN, NEW JERSEY 16.10 14.25 (B) 04/26/97 (C) 3,925,000 3,754,000 1% FEE.
BOHEMIA, NEW YORK 16.00 14.25 (B) 08/06/98 (C) 3,600,000 3,506,000
ONE MONTH'S INTEREST
RESTAURANTS:
MANASSAS, VIRGINIA 12.375 6.50 12/01/05 PRIN. AND INTEREST ANNUALLY 300,000 130,000 0.5%
IRONDEQUOIT, NEW YORK 12.50 7.20 12/01/12 PRIN. AND INTEREST ANNUALLY 340,000 197,000 1%
DECATUR AND JONESBORO, GEORGIA 13.00 8.50 04/01/13 (C) 583,000 379,000 (F)
PARTICIPATIONS:
FT. MYERS, FLORIDA 8.75 8.75 09/24/06 350,000 348,000 (F)
ORLANDO, FLORIDA 8.50 8.50 11/18/11 125,000 125,000 (F)
FT. LAUDERDALE, FLORIDA 8.75 8.75 (I) 325,000 325,000 (F)
RESIDENTIAL FIRST MORTGAGES:
CO-OPERATIVE APARTMENT BUILDINGS:
NEW YORK, NEW YORK 11.51 11.51 10/31/97 (C) 950,000 933,000 (E)
NEW YORK, NEW YORK 11.51 11.51 07/31/97 (D) 850,000 850,000 (E)
NEW YORK, NEW YORK 9.00 9.00 11/01/99 (C) 367,000 320,000 (E)
RENTAL APARTMENT BUILDINGS:
BRONX, NEW YORK 9.00 9.00 (A) 07/01/06 (C) 895,000 785,000
NOT PREPAYABLE UNTIL 1/1/2000.
BRONX, NEW YORK 10.50 10.50 (A) 11/01/12 (C) 2,445,000 2,237,000
NOT PREPAYABLE UNTIL 2/2003.
BRONX, NEW YORK 12.53 12.53 (A) 08/01/12 (C) 900,000 900,000
NOT PREPAYABLE UNTIL BALANCE UNDER $200,000,
2% FEE ON UNPAID BALANCE
NEW YORK, NEW YORK 10.00 10.00 10/01/00 (D) 265,000 265,000
NOT PREPAYABLE UNTIL 1/1/1997.
NEW YORK, NEW YORK 10.00 10.00 (A) 05/01/05 (C) 1,335,000 1,298,000 1% FEE
BRONX, NEW YORK 13.37 13.37 (A) 09/01/11 (C) 2,850,000 2,850,000
NOT PREPAYABLE UNTIL 3/1/2004
BRONX, NEW YORK 12.75 12.75 (A) 01/01/11 (C) 1,175,000 1,157,000 (E)
BRONX, NEW YORK 12.50 12.50 (A) 08/01/10 (C) 1,045,000 995,000
NOT PREPAYABLE UNTIL BALANCE UNDER $200,000.
BRONX, NEW YORK 13.50 9.53 (A) 03/01/97 (C) 625,000 591,000 (F)
BRONX, NEW YORK 13.50 9.57 (A) 03/01/97 (C) 670,000 633,000 (F)
BRONX, NEW YORK 13.75 13.75 (A) 06/01/13 (C) 2,000,000 1,934,000 (E)
BRONX, NEW YORK 9.00 9.00 (A) 11/01/15 (C) 1,260,000 1,188,000
NOT PREPAYABLE UNTIL 3/1999.
BRONX, NEW YORK 13.00 13.00 (A) 01/01/10 (C) 1,650,000 1,603,000
NOT PREPAYABLE UNTIL 10/1/2000.
NEW YORK, NEW YORK 10.00 10.00 10/01/00 (D) 1,445,000 144,000
NOT PREPAYABLE UNTIL 1/1/1997.
BRONX, NEW YORK 12.75 12.75 (A) 11/01/11 (C) 1,850,000 1,831,000
NOT PREPAYABLE UNTIL 1/1/2003.
NEW YORK, NEW YORK 11.00 10.00 03/15/10 (C) 1,150,000 1,056,000 (F)
NEW YORK, NEW YORK 11.00 10.00 03/15/10 (C) 300,000 279,000 (F)
BRONX, NEW YORK 12.77 12.77 (A) 11/01/13 (C) 4,510,000 4,510,000 (E)
NEW YORK, NEW YORK 10.00 10.00 10/01/00 (D) 425,000 425,000
NOT PREPAYABLE UNTIL 1/1/1997.
NEW YORK, NEW YORK 11.00 11.00 03/01/99 (D) 1,100,000 1,100,000 (F)
CITY ISLAND, BRONX, NEW YORK 24.00 24.00 09/30/96 (D) 650,000 346,000 (F)
NEW YORK, NEW YORK 13.50 13.50 (B) 02/28/97 (C) 1,300,000 1,272,000 1%FEE
HYDE PARK, NEW YORK 16.35 14.50 (B) 03/31/97 (C) 1,931,000 1,805,000 1% FEE.
-25-
<PAGE>
RESIDENTIAL FIRST MORTGAGES,
RENTAL APARTMENT BUILDINGS: (CONTINUED)
EAST ORANGE, NEW JERSEY 15.65 14.25 (B) 04/15/98 (C) 750,000 727,000
NOT PREPAYABLE PRIOR TO 7/15/1997; THEN 1% FEE.
CAMDEN, NEW JERSEY 15.83 14.00 (B) 07/01/97 (C) 1,200,000 1,003,000 1% FEE.
IRVINGTON, NEW JERSEY 17.80 16.00 (B) 08/01/97 (C) 1,600,000(G) 230,000
NOT PREPAYABLE PRIOR TO 5/1/1997; THEN 1% FEE.
PINE HILL, NEW JERSEY 16.00 14.25 (B) 05/01/99 (C) 7,200,000 7,063,000
NOT PREPAYABLE PRIOR TO 11/12/1997; THEN 1% FEE.
PHILADELPHIA, PENNSYLVANIA 16.00 14.25 (B) 06/12/99 (C) 3,800,000 3,670,000
NOT PREPAYABLE PRIOR TO 6/12/1997; THEN 1% FEE.
NEW YORK, NEW YORK 16.50 14.75 (B) 04/30/97 (C) 2,400,000(H)1,545,000 1% FEE.
ELLENVILLE, NEW YORK 16.62 14.75 (B) 04/30/97 (C) 950,000 873,000 1% FEE.
NEW YORK, NEW YORK 16.10 14.25 (B) 09/25/98 (C) 2,700,000 2,617,000
NOT PREPAYABLE PRIOR TO 6/26/1997;
THEN ONE MONTH'S INTEREST
EAST WINDSOR, NEW JERSEY 16.60 14.25 (B) 12/29/97 (C) 1,200,000 1,194,000
ONE MONTH'S INTEREST
FIRST MORTGAGES ON LAND:
OSCEOLA COUNTY, FLORIDA 16.20 14.25 (B) 07/10/97 (C) 1,600,000 1,571,000 1% FEE
RESIDENTIAL SECOND MORTGAGES,
RENTAL APARTMENT BUILDINGS:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NEW YORK, NEW YORK 12.00 12.00 02/01/99 (D) 4,832,000 1,050,000 1050,000 (F)
NEW YORK, NEW YORK 11.00 11.00 02/01/97 (D) 5,666,000 3,300,000 3,300,000 (F)
NEW YORK, NEW YORK 10.50 10.50 (B) 02/01/98 (D) 2,320,000 1,400,000 1,400,000 (F)
ASTORIA, N
EW YORK 14.25 14.25 (B) 01/17/99 (C) 6,289,000 1,160,000 1149,000
ONE MONTH'S INTEREST
NEW ROCHELLE, NEW YORK 11.50 11.50 (B) 03/01/96 (D) 1,300,000 500,000 500,000 (F)
ROCKVILLE CENTRE, NEW YORK 16.50 14.75 (B) 03/31/97 (C) 576,000 300,000 288,000 1% FEE
--------- --------- --------
$20,983,000 $74,901,000 $69,699,000
=========== =========== ===========
</TABLE>
(A) INTEREST PAYMENTS ARE FIXED. INTEREST RATE SHOWN IS APPROXIMATE.
(B) INTEREST AT FLUCTUATING RATE BASED ON BANK PRIME RATE.
(C) PRIN. AND INTEREST MONTHLY.
(D) INTEREST ONLY, PRIN. AT MATURITY.
(E) NO PREPAYMENT PERMITTED.
(F) NONE
(G) $1,250,000 OF PARTICIPATION OF MORTGAGE WAS SOLD IN 1996.
(H) $750,000 OF PARTICIPATION OF MORTGAGE WAS SOLD IN 1996.
(I) THE PARTICIPATING INTEREST WAS PAID IN FULL IN JANUARY 1997.
(J) THE CARRYING AMOUNT OF MORTGAGES APPROXIMATES COST FOR INCOME TAX
PURPOSES.
-26-
<PAGE>
INTERVEST CORPORATION OF NEW YORK
SCHEDULE IV--MORTGAGE LOANS ON REAL ESTATE--Continued
The following summary reconciles mortgages receivable at their carrying values:
Year Ended December 31
----------------------
1996 1995 1994
---- ---- ----
Balance at beginning of period $55,146,000 $56,666,000 $41,521,000
Additions during period:
Mortgages acquired 34,774,000 17,124,000 18,680,000
----------- ----------- -----------
89,920,000 73,790,000 60,201,000
Deductions during period:
Collections of principal, net
of amortization of discounts 2,221,000 18,644,000 3,535,000
----------- ----------- -----------
BALANCE AT CLOSE OF PERIOD $69,699,000 $55,146,000 $56,666,000
=========== =========== ===========
27
<PAGE>
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None
PART III
Item 10. Directors and Executive Officers of the Registrant
The current directors and executive officers of the Company are as follows:
Lawrence G. Bergman, age 52, serves as a Director, and as Vice President and
Secretary of the Company and has served in such capacities since the Company was
organized. Mr. Bergman received a Bachelor of Science degree and a Master of
Engineering (Electrical) degree from Cornell University, and a Master of Science
in Engineering and a Ph.D degree from The Johns Hopkins University. Mr. Bergman
is also a Director, Vice- President and Secretary of Intervest Bancshares
Corporation, and Co-Chairman of the Board of Directors and a member of the Loan
Committee of Intervest Bank. During the past five years, Mr. Bergman has been
actively involved in the ownership and operation fo real estate and mortgages
through certain family-owned entities.
Michael A. Callen, age 56, serves as a Director of the Company, and has served
in such capacity since October, 1992. Mr. Callen received a Bachelor of Arts
degree from the University of Wisconsin in Economics and Russian. Mr. Callen is
Senior Advisor, The National Commercial Bank, Jeddah, Saudi Arabia and prior to
1993 was a Director and Sector Executive at Citicorp/Citibank , responsible for
corporate banking activities in North America, Europe and Japan. Mr. Callen is a
Director of Intervest Bancshares Corporation and a Director of AMBAC, Inc.
Jean Dansker, age 75, serves as Vice President of the Company and has served in
such capacity since June, 1996. Mrs. Dansker received a Bachelor of Arts degree
from Brooklyn College in Economics. Mrs. Dansker has been an active investor in
real estate and mortgages for more than five years.
Jerome Dansker, age 78, serves as a Director and as Executive Vice President of
the Company, and has served in such capacity since November, 1993. Mr. Dansker
became Chairman of the Board of Directors in June, 1996. Mr. Dansker received a
Bachelor of Science degree from the New York University School of Commerce,
Accounts and Finance, a law degree from the New York University School of Law,
and is admitted to practice as an attorney in the State of New York. Mr. Dansker
is a Director, Chairman of the Board and Executive Vice President of Intervest
Bancshares Corporation. He is also a Director and Chairman of the Loan Committee
of Intervest Bank. During the past five years, Mr. Dansker has been actively
involved in the ownership and operation of real estate and mortgages through
certainfamily-owned entities.
Lowell S. Dansker, age 46, serves as a Director, and as President and Treasurer
of the Company, and has served in such capacities since the Company was
organized. Mr. Dansker received a Bachelor of Science in Business Administration
from Babson College, a law degree from the University of Akron School of Law,
and is admitted to practice as an attorney in New York, Ohio, Florida and the
District of Columbia. Mr. Dansker is also a Director, President and Treasurer of
Intervest Bancshares Corporation, an affiliated bank holding company and
Co-Chairman of the Board of Directors and a member of the Loan Committee of
Intervest Bank, a Florida state-chartered bank which is majority owned by
Intervest Bancshares Corporation. During the past five years, Mr. Dansker has
been actively involved in the ownership and operation of real estate and
mortgages through certain family-owned entities.
Milton F. Gidge, age 67, serves as a Director of the Company, and has served in
such capacity since December, 1988. Mr. Gidge received a Bachelor of Business
Administration degree in Accounting from Adelphi University and a Masters Degree
in Banking and Finance from New York University. Mr. Gidge retired in 1994 and,
prior to his retirment, was a Director and Chairman-Credit Policy of Lincoln
Savings Bank, F.S.B. (headquartered in New York City). He is also a Director of
Intervest Bancshares Corporation, Interboro Mutual Indemnity Insurance Company
and Vicon Industries, Inc. Mr. Gidge was an officer of Lincoln Savings Bank,
F.S.B. for more than five years.
28
<PAGE>
William F. Holly, age 68, serves as a Director of the Company and has served in
such capacity since December, 1990. Mr. Holly received a Bachelor of Arts degree
in Economics from Alfred University. Mr. Holly is Chairman of the Board and
Chief Executive Officer of Sage, Rutty & Co., Inc., members of the Boston Stock
Exchange, with offices in Rochester, New York and Canandaigua, New York, and is
also a Director of Intervest Bancshares Corporation and a Trustee of Alfred
University. Mr. Holly has been an officer and director of Sage, Rutty & Co.,
Inc. for more than five years.
David J. Willmott, age 58, serves as a Director of the Company, and has served
in such capacity since June, 1989. Mr. Willmott is a graduate of Becker Junior
College and attended New York University Extension and Long Island University
Extension of Southampton College. Mr. Willmott is the Editor and Publisher of
Suffolk Life Newspapers, which he founded more than 25 years ago. Mr. Willmott
is also a Director of Intervest Bancshares Corporation.
Wesley T. Wood, age 54, serves as a Director of the Company, and has served in
such capacity since April, 1992. Mr. Wood received a Bachelor of Science degree
from New York University, School of Commerce. Mr. Wood is President of Marketing
Capital Corporation, an international marketing consulting and investment firm
which he founded in 1973. He is also a Director of Intervest Bancshares
Corporation, a Director of the Center of Direct Marketing at New York
University, a member of the Marketing Committee at Fairfield University in
Connecticut, and a Trustee of St. Dominics in Oyster Bay, New York.
All of the directors of the Company have been elected to serve as directors
until the next annual meeting of the Company's shareholders. Each of the
officers of the Company has been elected to serve as an officer until the next
annual meeting of the Company's directors.
Mr. Bergman's wife is the sister of Lowell S. Dansker and Jerome Dansker is the
father of Lowell S. Dansker and Mrs. Bergman. Jean Dansker is the wife of Jerome
Dansker and the mother of Lowell S. Dansker and Mrs. Bergman.
Item 11. Executive Compensation
Prior to July 1, 1995, no compensation was paid to or accrued by the Company for
any executive officer or director of the Company (other than fees paid to
directors for attending Board meetings). Each of the directors receives a fee of
$250 for each meeting of the Board of Directors he attends. Effective as of July
1, 1995, the Company entered into an employment agreement with Mr. Jerome
Dansker, its Executive vice President. The agreement is for a term of ten years
and provides for the payment of an annual salary in the present amount of
$132,500, which is subject to increase annually by six percent or by the
percentage increase in the consumer price index, if higher. The agreement also
provides for monthly expense account payments, the use of a car and medical
benefits. In the event of Mr. Dansker's death or disability, monthly payments of
one-half of the amount which otherwise would have been paid to Mr. Dansker will
continue until the greater of (i) the balance of the term of employment, and
(ii) three years.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information concerning the ownership of the
outstanding common stock of the Company, all of which is beneficially owned by
the three individuals listed below:
29
<PAGE>
Amount and Nature of Percent of
Name and Address of Beneficial Owner Beneficial Ownership Class
- ------------------------------------ -------------------- ------------
Lowell S. Dansker 15.92 shares (1) 50.0%
360 West 55th Street
New York, New York 10019
Lawrence G. Bergman 3.79 shares 11.9%
201 East 62nd Street,
New York, New York 10021
Helene D. Bergman 12.13 shares (2) 38.1%
---------------- -----
201 East 62nd Street,
New York, New York 10021
Total Outstanding 31.84 shares 100.0%
================ =====
(1) Of the 15.92 shares beneficially owned by Mr. Dansker, 0.20 shares are owned
legally and of record by Mr. Dansker's wife, Randi O. Dansker, and 0.40 shares
are owned by Mr. Dansker as custodian for his two children under the Uniform
Gifts to Minors Act of the State of New York.
(2) Of the 12.13 shares beneficially owned by Mrs. Bergman, 0.40 shares are
owned by her as custodian for her two children under the Uniform Gifts to Minors
Act of the State of New York.
Item 13. Certain Relationships and Related Transactions
During 1995, Capital Holding Company and New York Properties Trust sold to third
parties four properties subject to mortgages held by the Company. In connection
with those sales the Company's mortgages were refinanced and the Company
acquired first mortgages totaling $9,670,000.
During 1994, New York Investment Company and Central Properties Trust sold to
third parties two properties subject to mortgages held by the Company. In
connection with those sales, the Company purchased a junior mortgage from an
unaffiliated party in the amount of $100,000, at a purchase price equal to its
then outstanding principal balance, and, the Company's mortgages were refinanced
and the Company acquired first mortgages totaling $5,610,000.
During 1994, the Company made mortgage loans in the amount of $2,400,000 on
properties owned by Capital Holding Company.
An annual mortgage servicing fee which is based on certain percentage of the
face amount of mortgages receivable is paid by the Company monthly to Capital
Holding Company, an affiliate of the Company. The services provided to the
Company by Capital Holding Company in consideration for such mortgage servicing
fee include (i) the collection of mortgages receivable, (ii) the payment of
mortgages payable, (iii) the payment of property taxes for the mortgaged
premises after receipt of such tax payments from mortgagors and (iv) the payment
of property insurance premiums for the mortgaged properties after receipt of
such insurance payments from mortgagors. For the fiscal year ended December 31,
1996, the amount of the mortgage servicing fee paid by the Company was $367,000.
Mr. William F. Holly, who is a director of the Company, also serves as Chairman
of the Board and Chief Executive Officer of Sage, Rutty & Co., Inc., which firm
has acted as an underwriter in connection with the Company's offerings of
debentures, including the offering of debentures conducted during fiscal 1996.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) (1) Financial Statements:
See Item 8 "Financial Statements and Supplementary Data"
30
<PAGE>
(a) (2) Financial Statement Schedules: IV - Mortgage Loans on Real Estate
All other schedules have been omitted because they are
inapplicable, not required, or the information is included in the
Financial Statements or Notes thereto.
(a) (3) Exhibits:
3.1 Certificate of Incorporation of the Company, incorporated by
reference to the Company's Registration Statement on Form S-18
(File No. 33-27404-NY), declared effective on May 12, 1989.
3.2 By-laws of the Company, incorporated by reference to the Company's
Registration Statement on Form S-11 (File No. 33-39971), declared
effective on May 13, 1991.
4.1 Form of Indenture between the Company and First American Bank of
Georgia, as trustee, dated as of October 15, 1989, incorporated by
reference to the Company's Registration Statement on Form S-11 (No.
33- 30758), declared effective on October 4, 1989.
4.2 Form of Indenture between the Company and First American Bank of
Georgia, as trustee, dated as of April 15, 1990, incorporated by
reference to the Company's Registration Statement on Form S-11 (No.
33- 33500), declared effective on March 28, 1990.
4.3 Form of Indenture between the Company and First American Bank of
Georgia, as trustee, dated as of June 1, 1991, incorporated by
reference to the Company's Registration Statement on Form S-11 (No.
33- 39971), declared effective on May 13, 1991.
4.4 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of March 1, 1992, incorporated by reference to
the Company's Registration Statement on Form S-11 (File No.
33-44085), declared effective on February 20, 1992.
4.5 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of July 1, 1992, incorporated by reference to the
Company's Registration Statement on Form S-11 (File No. 33-47801),
declared effective on June 29, 1992.
4.6 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of September, 15, 1993, incorporated by reference
to the Company's Registration Statement on Form S-11 (File No.
33-65812), declared effective on September 13, 1993.
4.7 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of February 1, 1994, incorporated by reference to
the Company's Registration Statement on Form S-11 (File No.
33-73108), declared effective on January 28, 1994.
4.8 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of November 1, 1994, incorporated by reference to
the Company's Registration Statement on Form-S11 (File No.
33-84812), declared effective on October 28, 1994.
4.9 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of June 1, 1995, incorporated by reference to the
Company's Registration Statement on Form-S11 (File No. 33-90596)
declared effective on May 12, 1995.
4.10 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of November 1, 1995, incorporated by reference to
the Company's Registration Statement on Form S-11 (File No.
33-96662), declared effective on October 19, 1995.
31
<PAGE>
4.11 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of June 1, 1996, incorporated by reference to the
Company's Registration Statement on Form S-11 (File No. 333-2459),
declared effective on May 10, 1996.
4.12 Form of Indenture between the Company and The Bank of New York, as
trustee, dated as of November 1, 1996, incorporated by reference to
the Company's Registration Statement on Form S-11 (File No.
333-11413), declared effective on October 15, 1996.
4.13 Agreements of Resignation, Appointment and Acceptance dated as of
April 30, 1992, by and among the Company, First American Bank of
Georgia, N.A. and The Bank of New York, incorporated by reference
to the Company's annual report on Form 10K for the year ended
December 31, 1992 wherein such documents were filed as exhibit 4.8.
10.0 Employment Agreement between the Company and Jerome Dansker dated
as of July 1, 1995, incorporated by reference to the Company's
Registration Statement on Form S-11 (File #33-96662), declared
effective on October 19, 1995.
22. List of Subsidiaries.
(b) Reports on Form 8-K:
None
32
<PAGE>
SIGNATURES
PURSUANT to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
INTERVEST CORPORATION OF NEW YORK
Dated: March 25, 1997 By: /S/ Lowell S. Dansker
---------------------
Lowell S. Dansker, President
PURSUANT to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.
Signatures
- ----------
President
(Principal Executive Officer),
/S/ Lowell S. Dansker Treasurer (Principal Financial
- ---------------------------
Lowell S. Dansker Officer and Principal Accounting
Dated: March 25, 1997 Officer) and Director
/S/ Lawrence G. Bergman Vice President
- ---------------------------
Lawrence G. Bergman Secretary and Director
Dated: March 25, 1997
Director
- ---------------------------
Michael A. Callen
Dated: March 25, 1997
/S/ Jerome Dansker Director, Executive Vice President
- ---------------------------
Jerome Dansker
Dated: March 25, 1997
Director
- ---------------------------
Milton F. Gidge
Dated: March 25, 1997
/S/ William F. Holly Director
- ---------------------------
William F. Holly
Dated: March 25, 1997
Director
- ---------------------------
David J. Willmott
Dated: March 25, 1997
/S/ Wesley T. Wood Director
- ---------------------------
Wesley T. Wood
Dated: March 25, 1997
33
<PAGE>
Supplemental Information to be Furnished with Reports Filled Pursuant to Section
15(d) of the Act by Registrants Which Have Not Registered Securities Pursuant to
Section 12 of the Act:
Registrant does not distribute annual proxy statements to holders of its
Debentures. The annual report to holders of its Debentures has not as yet been
distributed.
When the annual report has been distributed to the holders of Debentures, four
copies will be sent to the Commission.
34
<PAGE>
