UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended: September 30, 1996
Commission file Number: 0-6103
WATERMARK INVESTORS REALTY TRUST
(Exact name of registrant as specified in its charter.)
Texas 75-1372785
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
227 West Trade Street, Suite 2320, Charlotte, NC 28202
(Address of principal executive offices) (Zip Code)
(704)343-9334
(Registrant's telephone number, including area code)
Arlington Realty Investors
10670 N. Central Expressway, Ste. 640, Dallas, TX 75231
(Former Name, Former Address and Former Fiscal Year, if changed)
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 the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical
date:
As of November 11, 1996, there were outstanding 542,413
shares of beneficial interest of the registrant.
PART I. - FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
The accompanying Financial Statements have not been audited
by independent accountants, but in the opinion of management, all
adjustments (which consist of normal recurring accruals)
necessary for a fair presentation of results of operations,
financial position and cash flows at the dates and for the
periods indicated have been included.
WATERMARK INVESTORS REALTY TRUST
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS AND NINE MONTHS
ENDED SEPTEMBER 30, 1996 AND 1995
THREE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995 1996 1995
Gain on sale of land -- $ -- -- $3,765
Professional fees $ 260 $4,940 $15,524 $17,848
Property taxes -- -- -- 2,147
Interest Expense 769 769
Other Expenses 3,248 750 4,824 2,250
Total Expense 4,277 5,690 21,117 22,245
Net earnings (loss) ($ 4,277) ($5,690) ($21,117) ($18,480)
Earnings (loss per
share of beneficial ($0.01) ($0.01) ($0.04) ($0.03)
interest
Shares of beneficial
interest used in 542,413 542,413 542,413 542,413
computing per share
amounts
The accompanying notes are an integral part of these Financial
Statements.
WATERMARK INVESTORS REALTY TRUST
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30 DECEMBER 31
1996 1995
(Unaudited)
ASSETS
Real Estate $168,588 $168,588
Less allowance for
estimated losses (168,588) (168,588)
0 0
Cash 34,056 880
TOTAL ASSETS $34,056 $880
LIABILITIES AND SHAREHOLDER'S DEFICIT
LIABILITIES
Accrued $30,197 $36,673
Liabilities
Note payable 60,769
Unclaimed 20,174 20,174
dividends
111,140 56,847
SHAREHOLDERS' DEFICIT
Shares of
beneficial
interest, $1.00
par value,
authorized 196,235 196,235
10,000,000 shares
with 542,413
issued and
outstanding
Additional paid-in 44,205 44,205
capital
Accumulated (317,524) (296,407)
deficit
(77,084) (55,967)
TOTAL LIABILITIES AND
SHAREHOLDERS' DEFICIT $34,056 $880
The accompanying notes are an integral part of these Financial
Statements.
WATERMARK INVESTORS REALTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
NINE MONTHS ENDED
SEPTEMBER 30,
1996 1995
Cash flow from
operating activities:
Net earnings ($21,117) ($12,790)
(loss)
Adjustment to reconcile
net cash provided by
(used in) operating
activities
Net change in
accrued (5,707) (7,387)
liabilities
Net cash used in ($26,824) ($20,177)
Operations
Cash flows from
financing:
60,000
Proceeds from note
payable
Increase (decrease) in 33,176 (20,177)
cash
Cash
At beginning of 880 33,087
period
At end of period $34,056 $12,910
The accompanying notes are an integral part of these financial
statements.
WATERMARK INVESTORS REALTY TRUST
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
September 30, 1996
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted
accounting principles for interim financial information and with
the instructions to Form 10-Q and Rule 10-01 of Rule S-X.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management,
all adjustments considered necessary for a fair presentation have
been included. All such adjustments were of a normal recurring
nature. For further information refer to the financial
statements and footnotes thereto included as Exhibit 13 to
Corporation's annual report on Form 10-K for the year ended
December 31, 1995.
ITEM II. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources - At September 30, 1996, existing
current liabilities exceed available cash by $77,000.
Balance Sheet Changes - Assets increased by $33,000 for the
quarter. Accrued liabilities decreased by $23,000, as a result
of a $60,000 loan that was made to fund the payment of accrued
expenses.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
(27) Financial Data Schedule
b. Reports on Form 8-K
None.
WATERMARK INVESTORS REALTY TRUST
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
WATERMARK INVESTORS REALTY TRUST
Date: November 13, 1996 By: /s/ David S. Givner
David S. Givner
Trustee, President and
Treasurer
(Principal Executive
Officer and Principal
Financial and Accounting
Officer)
Date: November 13, 1996 By: /s/ Michael S. Verruto
Michael S. Verruto
Trustee, Vice President
and Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the Company's
financial statements contained in its Report on FOrm 10-Q for the quarter ending
September 30, 1996 and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 34,056
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 34,056
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 34,056
<CURRENT-LIABILITIES> 111,140
<BONDS> 0
0
0
<COMMON> 240,440
<OTHER-SE> (317,524)
<TOTAL-LIABILITY-AND-EQUITY> 34,056
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 21,117
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (21,117)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (21,117)
<EPS-PRIMARY> (0.04)
<EPS-DILUTED> (0.04)
</TABLE>
