As filed with the Securities and Exchange Commission on December 13, 1996
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
______________________
INSIGNIA FINANCIAL GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3591193
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
One Insignia Financial Plaza
P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip code)
Warrant Agreements
(Full title of the Plan)
John K. Lines, Esq.
General Counsel
Insignia Financial Group, Inc.
One Insignia Financial Plaza
P.O. Box 1089
Greenville, South Carolina 29602
(864) 239-1000
(Name, address and telephone number,
including area code, of agent for service)
_________________________________
Copies to:
Arnold S. Jacobs, Esq.
Proskauer Rose Goetz & Mendelsohn LLP
1585 Broadway
New York, New York 10036
(212) 969-3000
_________________________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of securities Amount to be Proposed maximum Proposed maximum Amount of
be registered registered offering price aggregate offering registration
per share price fee
<S> <C> <C> <C> <C>
Class A Common
Stock, par value
$0.01 per share 728,000shs(1) $13.5845(2) $9,889,500(2) $2,996.82(2)
<FN>
(1) Registered to cover shares of Class A Common Stock underlying warrant
agreements (the "Warrants").
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h) of the Securities Act of 1933. The Warrants have
varying exercise prices for shares of Class A Common Stock ranging up to
$13.6875 per share, with an average exercise price of $13.5845.
</FN>
</TABLE>
1
<PAGE>
Explanatory Note: Included in this Registration Statement, following Item 9
of Part II, is a "reoffer prospectus" relating to the resale of the securities
covered by this Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents By Reference.
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The following documents filed with the Securities and Exchange Commission
by Insignia Financial Group, Inc., a Delaware corporation (the "Corporation"),
are incorporated herein by reference:
(1) the Corporation's Annual Report on Form 10-K for the year ended
December 31, 1995;
(2) the Corporation's Quarterly Reports on Form 10-Q for the quarters
ended March 31, June 30 and September 30, 1996;
(3) the Corporation's Current Reports on Form 8-K dated January 19,
January 29, July 1, July 1, and December 6, 1996 and Form 8-K/A dated
September 13, 1996; and
(4) the description of the Corporation's Class A Common Stock, par
value $0.01 per share, included in the Corporation's Registration Statement
on Form 8-A, dated September 19, 1995, on Form 8-A/A(1) dated October 3,
1995 and on Form 8-A/A(2) dated June 21, 1996.
All documents subsequently filed by the Corporation with the Commission
pursuant to Sections 13(a), 13(c), 14, and 15(d) of the Securities Exchange Act
of 1934, as amended, prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be part hereof from the date of
filing such documents. Any statement in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus. The
Company will provide without charge to each person to whom this Prospectus is
delivered, upon written request of such person, a copy of any or all documents
incorporated herein by reference (other than exhibits to such documents, unless
such exhibits are specifically incorporated by reference into such documents).
Requests for such copies should be delivered to John K. Lines, General Counsel
and Secretary, Insignia Financial Group, Inc., One Insignia Financial Plaza,
P.O. Box 1089, Greenville, South Carolina 29602 or telephone at (864) 239-1000.
Item 4. Description of Securities.
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Not applicable.
II-1
<PAGE>
Item 5. Interest of Named Experts and Counsel.
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Not applicable.
Item 6. Indemnification of Directors and Officers.
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The Corporation is incorporated in Delaware. Under Section 145 of the
General Corporation Law of the State of Delaware, a Delaware corporation has the
power, under specified circumstances, to indemnify its directors, officers,
employees and agents in connection with actions, suits or proceedings brought
against them by a third party or in the right of the corporation, by reason of
the fact that they were or are such directors, officers, employees or agents,
against expenses incurred in any action, suit or proceeding. Article Seventh of
the Certificate of Incorporation of the Corporation provides for indemnification
of directors and officers to the fullest extent permitted by the General
Corporation Law of the State of Delaware, and the Corporation has entered into
agreements with 20 of its officers and directors with respect to such
indemnification. Reference is made to the Certificate of Incorporation of the
Corporation and such agreements, incorporated by reference as Exhibits to the
Corporation's Registration Statement on Form S-1, File No. 33-67486.
Section 102(b)(7) of the General Corporation Law of the State of Delaware
provides that a certificate of incorporation may contain a provision eliminating
or limiting the personal liability of a director to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director
provided that such provision shall not eliminate or limit the liability of a
director (i) for any breach of the director's duty of loyalty to the corporation
or its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 (relating to liability for unauthorized acquisitions or redemptions
of, or dividends on, capital stock) of the General Corporation Law of the State
of Delaware, or (iv) for any transaction from which the director derived an
improper personal benefit. Article Eighth of the Corporation's Certificate of
Incorporation contains such a provision.
The Corporation currently has a Directors and Officers Liability Insurance
Policy (the "Policy") in place with Federal Insurance Company. The Policy is a
"claims made" policy with a $5,000,000 policy aggregate. However, the Board of
Directors believes that it serves the Corporation's best interest to supplement
this coverage or any coverage which the Corporation may maintain in the future
by agreeing by contract to indemnify directors and executive officers to the
fullest extent permitted under applicable law.
The form of Indemnification Agreement to be entered into by the Corporation
with directors and executive officers of the Corporation is based on the
provisions of the General Corporation Law of the State of Delaware, which are
contained primarily in Section 145 of the General Corporate Law of the State of
Delaware, but is intended to provide broader indemnification than that which is
specifically provided by Section 145. The form of Indemnification Agreement
provides generally that the Corporation will to the fullest extent permitted by
applicable law indemnify the director or executive officer against expenses
arising from any event or occurrence, either prior to or after the time the
Indemnification Agreement is executed, related to the fact that such person is
or was serving as a director or executive officer of the Corporation (or of
another entity at the Corporation's request). To be indemnified, a party must
meet the relevant standards of conduct, but the form of Indemnification
II-2
<PAGE>
Agreement provides that such standard is presumed to have been met unless the
Corporation demonstrates otherwise.
Item 7. Exemption from Registration Claimed.
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Not applicable.
Item 8. Exhibits.
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4.1 Form of warrant (incorporated by reference to the Corporation's Proxy
Statement dated April 22, 1996).
5 Opinion of Proskauer Rose Goetz & Mendelsohn LLP.
23.1 Consent of Ernst & Young LLP (included on Page II-7).
23.2 Consent of Coopers & Lybrand L.L.P. (included on Page II-8).
23.3 Consent of Coopers & Lybrand L.L.P. (included on Page II-9).
23.4 Consent of Imowitz Koenig & Co., LLP (included on Page II-10).
23.5 Consent of Proskauer Rose Goetz & Mendelsohn LLP (included in Exhibit
5).
24 Powers of Attorney.
Item 9. Undertakings.
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(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section
II-3
<PAGE>
13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(h) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE>
PROSPECTUS
728,000 Shares
INSIGNIA FINANCIAL GROUP, INC.
Common Stock
____________________
All of the 728,000 shares of Class A Common Stock par value $0.01 per share
(the "Common Stock") of Insignia Financial Group, Inc. ("Insignia" or the
"Company") are being sold by certain stockholders of the Company (the "Selling
Stockholders"). The shares offered hereby comprise shares which may be acquired
by the Selling Stockholders upon exercise of certain warrants received by them
as employees of the Company. The Company will receive the exercise price on any
such exercise, but will not receive any proceeds from the sale of shares by the
Selling Stockholders. See "Selling Stockholders."
____________________
See "Risk Factors" on page P-5 for a discussion of certain factors to be
considered by prospective investors.
____________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
December 13, 1996
P-1
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement (of which this Prospectus is a part) on
Form S-8 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the Common Stock offered hereby.
This Prospectus, which constitutes part of the Registration Statement, does not
contain all of the information set forth in the Registration Statement, certain
portions of which have been omitted as permitted by the rules and regulations of
the Commission. For further information with respect to the Company and the
Common Stock offered hereby, reference is made to the Registration Statement, to
the documents incorporated by reference therein, and to the schedules and
exhibits thereto.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith, files reports, proxy statements and other information with the
Commission. The Registration Statement, reports, proxy statements and other
information filed by the Company can be inspected and copied at the public
reference facilities of the Commission at its principal office at 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549, and at the Commission's
regional offices at Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661, and at Seven World Trade Center, 13th Floor, New
York, New York 10048. Copies of such materials also may be obtained at
prescribed rates from the Public Reference Section of the Commission at its
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549.
Such documents also are available through the Commission's World Wide Web site
(http://www.sec.gov).
The Common Stock is listed on the New York Stock Exchange ("NYSE").
Reports, proxy statements and other information concerning the Company can be
inspected at the offices of the NYSE, 20 Broad Street, New York, New York 10005.
INCORPORATION BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference: (i) the Company's Annual Report on Form 10-K
for the year ended December 31, 1995; (ii) the Company's Quarterly Reports on
Form 10-Q for the quarters ended March 31, June 30 and September 30, 1996; (iii)
the proxy statement for the Company's Annual Meeting of Stockholders held on May
23, 1996; (iv) the Company's Current Reports on Form 8-K dated September 1,
1995, January 19, 1996, January 29, 1996, July 1, 1996, July 1, 1996, December
9, 1996, December 10, 1996 and December 10, 1996 and Form 8-K/A dated September
13, 1996; (v) the combined consolidated financial statements of NPI Property
Management Corporation, Inc., National Property Investors, Inc. and NPI-CL
Management L.P. contained in the Company's Registration Statement on Form S-3
filed with the Securities and Exchange Commission on September 1, 1995, as
amended by Amendment No. 1 to Form S-3 filed on September 19, 1995, and the
final prospectus filed pursuant to Rule 424(b) on October 13, 1995; and (vi) the
description of the Common Stock contained in Insignia's Registration Statement
on Form 8-A, dated September 19, 1995, on Form 8-A/A(1) dated October 3, 1995
and on Form 8-A/A(2) dated June 21, 1996. All documents subsequently filed by
the Company with the Commission pursuant to Sections 13(a), 13(c), 14, and 15(d)
of the Exchange Act prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be part hereof from the date of
filing such documents. Any statement in a document incorporated or
P-2
<PAGE>
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for the purposes of this Registration Statement to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus. The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written request of such person, a copy of any or
all documents incorporated herein by reference (other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference into
such documents). Requests for such copies should be delivered to John K. Lines,
General Counsel and Secretary, Insignia Financial Group, Inc., One Insignia
Financial Plaza, P.O. Box 1089, Greenville, South Carolina 29602 or telephone at
(864) 239-1000.
TABLE OF CONTENTS
Page
The Company................................................................P-3
Risk Factors...............................................................P-5
Selling Stockholders..................................................... P-12
Legal Opinions........................................................... P-14
Experts...................................................................P-14
THE COMPANY
General
Insignia is a fully integrated real estate services organization
specializing in the operation and ownership of securitized real estate assets.
According to Commercial Property News and the National Multi-Housing Council,
Insignia is the largest property manager in the United States, has been the
largest manager of multi-family residential properties since 1992, and is among
the largest managers of commercial properties. Insignia's real estate services
include property management, providing all of the day-to-day services necessary
to operate a property, whether residential or commercial; asset management,
including long-term financial planning, monitoring and implementing capital
improvement plans, and development and execution of refinancings and
dispositions; real estate leasing and brokerage; maintenance and construction
services; marketing and advertising; investor reporting and accounting; and
investment banking, including assistance in workouts and restructurings, mergers
and acquisitions, and debt and equity securitizations. The Company through its
subsidiary, Compleat Resource Group, Inc. ("CRG"), markets consumer goods and
services to the residents and owners of multi-family properties, including
properties which Insignia manages. CRG has formed a strategic alliance with GE
Capital - ResCom, L.P. for the purpose of providing long-distance telephone and
cable television services.
Insignia commenced operations in December 1990 and since then has grown to
provide property and/or asset management services for over 2,500 properties,
which include approximately 283,000 residential units, and approximately 107
million square feet of commercial space, located in over 500 cities in 48
states. Insignia currently provides partnership administration services to
approximately 900
P-3
<PAGE>
limited partnerships having approximately 400,000 limited partners. Insignia
also owns limited partner interests (ranging from 4% to 54% of the outstanding
interests) in 28 real estate limited partnerships which in the aggregate own 143
properties with approximately 38,100 residential apartment units and
approximately 865,000 square feet of commercial space located in 83 cities in 28
states.
Insignia's principal business strategy is to expand its real estate
services business in three primary ways. First, Insignia seeks to acquire, or to
have an affiliate acquire, controlling positions in entities that own or control
real estate properties, and then, subject to their fiduciary duties, to have
such entities engage Insignia to provide services. Second, Insignia seeks to
enter into special contractual relationships with non-affiliated third parties
that own or control portfolios of real estate properties pursuant to which
Insignia will provide management services. Third, Insignia seeks to expand its
management of properties that are owned by non-affiliated third parties, such as
large insurance companies, banks, government or quasi-government agencies, and
other institutional investors and lenders.
The Company is a Delaware corporation incorporated in July 1990 and its
principal executive offices are located at One Insignia Financial Plaza, P.O.
Box 1089, Greenville, South Carolina 29602, and its telephone number is (864)
239-1000.
Recent Developments
ESG Acquisition
On June 30, 1996, the Company acquired the business and substantially all
of the assets of Edward S. Gordon Company, Incorporated and its affiliates
("ESG"), the fourth largest commercial real estate property services firm in the
United States. ESG's services include commercial real estate leasing, including
tenant and landlord representation, real estate consulting services and
commercial real estate brokerage, as well as commercial property management in
the New York City metropolitan area. The purchase price was approximately $73.8
million. At closing, ESG managed approximately 25.5 million square feet of
commercial space comprised of 57 properties in New York, New Jersey and
Connecticut. The ESG acquisition provided Insignia with a substantial presence
in the commercial segment of the metropolitan New York City market, which
complements its leading presence in the residential segment.
Paragon Acquisition
On June 30, 1996, the Company acquired the commercial real estate services
business of Paragon Group, Inc. ("Paragon"). The services of the acquired
business include commercial property management, leasing and tenant improvement
services performed with respect to Paragon properties, as well as brokerage, fee
development and real estate consulting services performed for various
institutional clients. The purchase price paid was $18.5 million. At closing,
the acquired business managed and leased approximately 22 million square feet of
commercial space comprised of 166 properties located in 17 states: 12.5 million
square feet of office properties, 4.9 million square feet of industrial
properties, and 4.5 million square feet of retail properties. This acquisition
added substantially to the Company's presence in the Southern California and
Dallas markets and provided a substantial presence in the Central Florida
market.
P-4
<PAGE>
Convertible Preferred Securities Offering
On November 1 and 6, 1996, Insignia Financing I, a Delaware business trust
(the "Trust"), issued and sold (the "Convertible Preferred Securities Offering")
2,990,000 of its 6 1/2% Trust Convertible Preferred Securities with an aggregate
liquidation amount of $149.5 million (the "Convertible Preferred Securities").
All of the outstanding common securities of the Trust, with an aggregate
liquidation value of approximately $4.6 million (the "Common Securities"), are
owned by the Company, which entitles it to designate the trustees of the Trust.
The Convertible Preferred Securities were sold to Lehman Brothers, Dillon, Read
& Co. Inc., Goldman, Sachs & Co. and A.G. Edwards & Sons, Inc. (the "Initial
Purchasers") for an aggregate purchase price of $149.5 million. The Company paid
the Initial Purchasers a commission of 3% of the aggregate purchase price. The
Initial Purchasers resold the Convertible Preferred Securities (i) to "qualified
institutional buyers" (as defined in Rule 144A under the Securities Act) in
compliance with Rule 144A, (ii) to other institutional "accredited investors"
(as defined in Rule 501(A) (1), (2), (3) or (7) under the Securities Act) in
compliance with Regulation D under the Securities Act and (iii) outside the
United States to persons other than U.S. persons in reliance on Regulation S
under the Securities Act. The Preferred Securities may be converted at the
option of the holder after December 30, 1996 into shares of Common Stock at the
rate of 1.8868 shares of Common Stock for each Convertible Preferred Security
(equivalent to a conversion price of $26.50 per share of Common Stock). The
Convertible Preferred Securities and the Common Securities represent undivided
beneficial interests in the assets of the Trust, which consist of approximately
$154.1 million aggregate principal amount of the Company's 6 1/2% Convertible
Subordinated Debentures due September 30, 2016.
RISK FACTORS
Prospective investors should consider carefully, in addition to the other
information contained in, and incorporated by reference into, this Prospectus,
the following factors.
Dependence on Management Agreements
Insignia is substantially dependent on revenues received for services under
property and asset management agreements. On a pro forma basis giving effect to
the consummation of the ESG and Paragon acquisitions, for the nine months ended
September 30, 1996, revenues from property and asset management agreements
constituted approximately 95% of total revenues, and, as of such date, property
and asset management agreements constituted approximately 28% of Insignia's
total assets. There can be no assurance that Insignia will be able to maintain
all such agreements. In particular, a majority of agreements with non-affiliated
parties have terms of one year, and many are cancelable by the property owner on
as little as 30 to 60 days' notice. Approximately 78% of Insignia's pro forma
revenues for the nine months ended September 30, 1996, giving effect to such
acquisitions as if effected at the beginning of such period, were derived from
fees for services provided to entities not controlled by Metropolitan Asset
Enhancement, L.P. ("MAE") or Insignia. MAE is an entity in which Insignia holds
a 19.1% limited partner interest and the general partner of which is owned by
Andrew L. Farkas. The loss of a substantial number of management agreements
could have a material adverse effect on Insignia.
P-5
<PAGE>
After giving pro forma effect to the ESG and Paragon acquisitions,
approximately 6% of Insignia's pro forma revenues during the nine months ended
September 30, 1996 were derived from services performed for properties
controlled by a single client, The Balcor Company ("Balcor"). Insignia purchased
the right to manage such properties in 1994 and has contractual arrangements
with Balcor that are intended to reduce the likelihood that such management
agreements will be terminated. As of September 30, 1996, the Company managed
approximately 178 properties, comprising approximately 30,200 units of
multifamily residential housing and 11 million square feet of commercial space,
associated with that acquisition (44 of the properties, comprising approximately
1,600 units of multifamily residential housing and 4.9 million square feet of
commercial space, are not controlled by Balcor). Insignia also manages 6.1
million square feet of commercial space in properties controlled by Balcor which
produced $3.2 million in revenues for the nine months ended September 30, 1996.
The Company believes such properties will be sold in the near future.
During the first quarter of 1996, Balcor announced its intention to sell a
significant number of its properties. In connection with the potential sales of
such properties, Balcor has entered into agreements with the Company to provide
additional services (the "Advisory Agreements"), including collection of data,
the preparation of materials for potential purchasers, and assistance with
regard to transition plans. The Advisory Agreements have an initial term of one
year and provide for fees to be paid to the Company if and when a property is
sold (the "Advisory Fees"), regardless of whether or not the purchaser retains
the Company to continue to manage the property. If all sales were consummated
for the properties that Balcor is marketing, approximately $14.4 million in
annual revenues would be lost while approximately $14.7 million in Advisory Fees
would be collected. Through September 30, 1996, 48 properties comprising 14,800
units producing $4.9 million in annual management fees have been sold, with
Advisory Fees received or due aggregating $4.6 million. There are proposed sales
of an additional 113 properties comprising 25,800 units and 3.3 million square
feet of commercial space which generate approximately $9.5 million in management
revenues which would produce Advisory Fees of $10.1 million. The completed and
proposed sales are included in the totals mentioned above. Management believes
that the unamortized purchase price relating to properties managed for Balcor
properly reflects the asset value and that no impairment exists.
The number and timing of property sales by Balcor during the term of the
Advisory Agreements cannot be predicted. Therefore, the Company cannot estimate
with any reasonable accuracy the amount of any Advisory Fees it may receive, the
reduction of its management fees or the amount of unamortized purchase price to
be written off. The Company expects that any potential impact to its EBITDA in
1996 from potential property sales and resulting terminations of the Company's
management agreements would not be material. However, revenues lost and not
replaced through acquisitions of incremental third party servicing would fully
impact 1997 EBITDA.
On a pro forma basis giving effect to the consummation of the ESG and
Paragon acquisitions, approximately 16% of Insignia's revenues for the nine
months ended September 30, 1996 were derived from fees for services provided to
entities controlled by MAE. MAE has agreed to (i) retain Insignia for a
substantial term as property manager for all properties currently controlled by
MAE or of which MAE acquires control, subject to its fiduciary duties and
certain other exceptions, and (ii) make certain payments to Insignia on any
disposition by MAE of its assets. However, there can be no assurance that such
payments will adequately compensate Insignia for the loss of management
agreements that may result from any properties being sold by MAE.
P-6
<PAGE>
Risks Associated with Acquisitions
Insignia's growth since its inception in 1990 has been based principally
upon the acquisition of portfolios of general partner interests in real estate
limited partnerships and the provision by Insignia of management and related
services to such partnerships. Since its inception, Insignia and its affiliates
have acquired control of, or management rights to, 32 portfolios of properties.
The Company's ability to expand successfully through acquisitions depends on
many factors, including the successful identification and acquisition of
businesses and management's ability effectively to integrate the acquired
businesses. The future growth of Insignia will be dependent in part upon the
ability of Insignia or MAE to acquire control of real estate entities at
favorable prices and upon favorable terms and conditions, and to continue to
manage such entities and the properties they own on a profitable basis. In
addition, with respect to a limited portion of the managed portfolio, lenders
may foreclose upon properties which are unable to service their mortgage
indebtedness. In such event, there can be no assurance that Insignia will retain
the contracts to manage such properties.
Acquisitions entail risks that investments will fail to perform in
accordance with expectations, and that business judgments with respect to a
property's revenues, operating expenses, and costs of improvements and the
Company's ability to restructure and benefit from restructurings, will prove
inaccurate. Acquisitions also involve the risks of the diversion of management's
attention, the assimilation of the operations and personnel of the acquired
companies, the amortization of acquired intangible assets and the potential loss
of key employees, each of which could adversely affect the Company's operating
results. In addition, the success of any completed acquisition will depend in
part on the Company's ability effectively to integrate any acquired businesses
into the Company.
There can be no assurance that future acquisition opportunities, if any,
can be consummated on favorable terms, that Insignia will be successful in
acquiring or integrating any businesses or in restructuring the liabilities of
any such entities, or that any such acquisition will enhance the Company's
business.
On a pro forma basis giving effect to the Convertible Preferred Securities
Offering and the use of the net proceeds therefrom, at September 30, 1996 the
Company had $161.4 million in funds available under its agreement with First
Union National Bank of South Carolina and an affiliate of Lehman Brothers Inc.
with respect to a revolving credit facility for acquisitions and its working
capital needs, but there can be no assurance that Insignia's financing resources
will be sufficient to finance future acquisitions, if any. To the extent the
Company issues shares of its Common Stock or rights to acquire shares of its
Common Stock in connection with any such acquisitions, the ownership of existing
stockholders will be diluted.
Potential Conflicts of Interest; Dependence Upon and Control by Andrew L. Farkas
Andrew L. Farkas, the Chairman, President and Chief Executive Officer of
Insignia, may be deemed to be in control of each of Insignia, MAE, and certain
significant stockholders of the Company. Insignia has in the past engaged, and
expects in the future to engage, in certain transactions with each of such
affiliated entities. Such transactions could result in actual or potential
conflicts of interest between Insignia, on the one hand, and Mr. Farkas, MAE, or
such stockholders, as the case may be, on the other hand. In addition, conflicts
may arise between Insignia and the partnerships in which MAE is a general
partner, particularly with respect to determinations of whether to dispose of
properties. Insignia
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<PAGE>
has entered into agreements with MAE and Mr. Farkas to address certain of such
potential conflicts. Insignia also has a policy that all transactions with
affiliates shall be on terms no less favorable to Insignia than could be
obtained from an unaffiliated party and must be approved by either a majority of
independent directors or the Audit Committee of the Board of Directors. There
are no other formal procedures for resolving such conflicts.
As of December 1, 1996, Mr. Farkas beneficially owned approximately 28.4%
of the outstanding Common Stock. Mr. Farkas continues to exercise a controlling
influence over the business and affairs of Insignia, including, but not limited
to, having sufficient voting power to substantially control the election of the
entire Board of Directors of Insignia and, in general, substantially to
determine the outcome of any corporate transaction or other matter submitted to
the stockholders for approval, including mergers, consolidations, or the sale of
substantially all of Insignia's assets or preventing or causing a change in the
control of Insignia.
Insignia is dependent upon the continued services of Mr. Farkas. Mr. Farkas
expects to continue to devote substantially all of his time to Insignia and MAE.
The loss of Mr. Farkas's services could have a material adverse effect upon the
business and financial condition of Insignia. Mr. Farkas has entered into an
employment agreement with Insignia, expiring September 1, 1998, providing for,
among other things, an agreement not to compete with Insignia during his
employment and for a period of one year thereafter. Insignia maintains a $10
million key man life insurance policy on Mr. Farkas.
Insignia is required to make certain payments to Mr. Farkas in the event of
certain changes in control which may constitute excess parachute payments and
would not be deductible by Insignia for income tax purposes. In addition,
Insignia may not be permitted to deduct for income tax purposes that portion of
an executive's compensation which exceeds $1 million in any year, excluding
certain performance based compensation. There can be no assurance that Insignia
will be able to deduct the entire amount earned by Mr. Farkas in any year.
Dependence on Property Performance
Insignia's revenues from property management services are generally
percentages of aggregate rent collections from the properties. Accordingly, the
continued success of Insignia will be dependent in large part upon the
performance of the properties it manages. Such performance in turn will depend
in part upon the ability of Insignia to attract and retain creditworthy tenants,
the magnitude of defaults by tenants under their respective leases, Insignia's
ability to control operating expenses (many of which are subject to various
contingencies), governmental regulations, local rent control or stabilization
ordinances which are or may be put into effect, various uninsurable risks,
financial conditions prevailing generally and in the areas in which such
properties are located, the nature and extent of competitive properties in the
areas where such properties are located, and the real estate market generally.
Risks Related to Investment in Limited Partner Interests
The Company owns significant limited partner interests in 28 different real
estate limited partnerships (the "Partnerships") directly or indirectly through
wholly owned subsidiaries and joint ventures. The Company's limited partner
interests, including the Company's interests in two limited partnerships which
are consolidated in Insignia's financial statements, represent approximately 29%
of
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the book value of the Company's assets at September 30, 1996. All of such
limited partnerships own residential, and in some cases commercial, properties.
Limited partner interests are subject to varying degrees of risk incident
to the ownership and operation of commercial and residential real estate,
including possible environmental liabilities. See "-Possible Environmental
Liabilities." The success of an investment in a real estate limited partnership
will depend on factors such as general economic conditions, both on a national
basis and in those areas where a limited partnership's properties are located,
the availability and costs of borrowed funds, real estate tax rates,
construction and property management costs, federal and state income tax laws,
operating expenses, energy costs, and government regulations. Typically,
properties held by the limited partnerships are subject to mortgages and the
loss of a property through foreclosure could adversely affect the value of a
limited partnership interest. In addition, numerous properties compete for
tenants with the properties owned by the limited partnerships in which the
Company has limited partner interests.
No active market for limited partner interests in the Partnerships exists,
none is expected to develop and such interests are typically only transferable
at significant discounts to underlying value. The Company may be limited in its
ability to vary its portfolio promptly in response to changes in economic or
other conditions. The price to be paid for additional limited partner interests
may need to be increased, and the percentage of such interests to be acquired
decreased, in response to competing offers for such interests that may be made.
The Company participates with other entities in ownership of limited
partner interests through partnerships and joint ventures. Partnership and joint
venture investments may, under certain circumstances, involve risks not
otherwise present, including the possibility that such partners or co-venturers
might at any time have business interests or goals inconsistent with the
business interests or goals of the Company and that such partners or
co-venturers may be in a position to take action contrary to the Company's
instructions, requests, policies, or objectives. The Company will, however, seek
to maintain sufficient influence over such partnerships or joint ventures to
permit the Company's business objectives to be achieved. The Company currently
owns limited partner interests in six real estate limited partnerships in which
MAE is the general partner. There can be no assurance that MAE will not transfer
to a third party its general partner interests in those partnerships or that MAE
will not take actions contrary to the Company's interests with respect to those
partnerships. See "-Potential Conflicts of Interests."
Potential Alternative Structuring of Certain Activities
The Company actively is exploring a structure whereby its multifamily real
estate investment and ownership activities would (a) qualify for United States
federal income tax purposes as a Real Estate Investment Trust ("REIT") under the
Internal Revenue Code of 1986, as amended (the "Code"), and (b) obtain equity
and debt capital from parties other than Insignia to expand these activities.
In this regard, Insignia formed Insignia Properties Corporation, a Delaware
corporation and wholly-owned subsidiary, in January 1996 and Insignia Properties
Trust, a Maryland real estate investment trust ("IPT"), in April 1996, with the
intention of implementing a series of transactions that would result in
substantially all of the Company's real estate limited partner interests in real
estate limited partnerships being conveyed to an entity that would intend to
qualify as a REIT. As of
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<PAGE>
the date of this Prospectus, the Company is actively preparing to raise capital
through the private placement of securities in IPT. Such transaction would be
structured such that the Company would continue to own and control a majority
interest in IPT. In addition, the Company has had discussions with the
management of Angeles Mortgage Investment Trust, a publicly-traded California
business trust and REIT ("AMIT"), regarding a potential business combination
transaction with IPT and has acquired the beneficial ownership of approximately
6.0% of the Class A shares of AMIT. These discussions principally have involved
whether general and limited partner interests owned by Insignia in certain
partnerships which own real property could be transferred, through a merger or
otherwise, to AMIT in exchange for securities in AMIT. The Company, however, has
no plans otherwise to dispose of its interests in such partnerships.
There can be no assurance that the transactions that are currently
contemplated and that are discussed herein in connection with the proposed REIT
transaction will be consummated or, if consummated, that they will be
consummated on the terms described herein.
Tender Offer Litigation
Since the latter part of 1994, Insignia, through various subsidiaries, has
acquired limited partner interests in real estate limited partnerships through
public tender offers. Insignia believes that there continue to be opportunities
to acquire limited partner interests and it may acquire such interests through
future public tender offers. Tender offers often result in competing tender
offers, as well as litigation initiated by limited partners in the subject
partnerships or by competing bidders. In some of its tender offers, Insignia has
faced competing offers and litigation which alleged breaches of the federal
securities laws and breaches of fiduciary duties by Insignia. Due to the
inherent uncertainty of litigation, the Company could be subject to adverse
judgments in substantial amounts. Litigation costs and competing offers are
factors considered by the Company prior to initiating tender offers. Insignia
has settled all litigation brought against it in connection with tender offers
made by it with the exception of certain litigation in connection with tender
offers for limited partner interests in limited partnerships controlled by
Balcor.
Competition for Personnel
The continued success of Insignia's residential and commercial property
management business will depend, in part, on Insignia's ability to maintain its
experienced management team and to attract additional managers as Insignia's
property management business expands. Insignia believes that there is currently
a shortage of qualified property management personnel. To maintain and attract
qualified individuals, Insignia may be required to increase substantially the
compensation to property managers.
Possible Environmental Liabilities
Under various federal and state environmental laws and regulations, a
current or previous owner or operator of real estate property may be required to
investigate and clean up certain hazardous or toxic substances or petroleum
product releases at the property, and may be held liable to a governmental
entity or to third parties for property damage and for investigation and cleanup
costs incurred by such parties in connection with contamination. In addition,
some environmental laws create a lien on the contaminated site in favor of the
government for damages and costs it incurs in connection with the contamination.
The presence of contamination or the failure to remediate
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<PAGE>
contamination may adversely affect the owner's ability to sell or lease real
estate or to borrow using the real estate as collateral. The owner or operator
of a site may be liable under common law to third parties for damages and
injuries resulting from environmental contamination emanating from the site.
There can be no assurance that Insignia, or any assets owned or controlled by
Insignia, currently are in compliance with all of such laws and regulations, or
that Insignia will not become subject to liabilities that arise in whole or in
part out of any such laws, rules, or regulations. Moreover, there can be no
assurance that any of such liabilities to which Insignia may become subject will
not have a material adverse effect upon the business or financial condition of
Insignia.
Except for (i) environmental audits of approximately 240 properties
conducted in connection with various refinancings and reviews of sellers' files
with respect to environmental matters in connection with certain acquisitions
and (ii) Phase I audits of properties owned by National Property Investors, Inc.
and certain affiliates and related partners in which Insignia acquired limited
partner interests (and certain other investigations in the case of certain such
properties), Insignia has not undertaken any review, on a property-by-property
basis, of the extent of the presence of asbestos or other environmental risks at
any of its owned or controlled properties, the remedial or other requirements of
state and local environmental laws, rules, and regulations in each of the
jurisdictions in which such properties are located, or the costs of any required
remedial work. Although the results of all but a few of the Company's audits did
not require any material remedial work, there can be no assurance that remedial
work may not be required at these or other properties. Most of the structures
situated upon such properties were constructed prior to 1978, in a period when
the use of asbestos in the construction of structures similar to those situated
upon such properties was common. The presence of asbestos or other environmental
risks at any of such properties could result in the incurrence of significant
cleanup costs therefor by Insignia or partnerships in which it owns interests or
the incurrence of toxic tort claims against Insignia or partnerships in which it
owns interests.
There can be no assurance that Insignia will not experience difficulty in
reselling real estate assets owned by partnerships or refinancing any
indebtedness secured by their respective assets as a result of the presence of
asbestos or other environmental risks on the properties, lose its management
contracts with respect to such properties, or become subject to costs and
litigation relating to the presence of asbestos or other environmental risks on
such properties that will have a material adverse effect upon the business or
financial condition of Insignia or any of its affiliates.
Possible Loss of HUD Approval; Restructuring of HUD
Approximately 17% of the residential units which Insignia managed at
September 30, 1996 were housing projects financed under various government
programs administered by the United States Department of Housing and Urban
Development ("HUD"). As a result, certain aspects of Insignia's operations are
subject to regulation by HUD. For the nine months ended September 30, 1996,
revenues from the management of HUD regulated or subsidized units constituted
approximately 7% of Insignia's total pro forma revenues giving effect to the
Paragon and ESG acquisitions. If Insignia were to lose its qualification to
manage HUD properties, Insignia could be precluded from obtaining HUD contracts,
could lose the contracts to manage some or all of the HUD properties then
managed, or could be subject to fines or other penalties, depending on the
reason for such loss of qualification. Such results could have a material
adverse effect on Insignia's business or financial condition.
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<PAGE>
Congress is currently considering various proposals to reorganize and
restructure certain of HUD's housing assistance programs. One proposal calls for
the elimination of HUD by terminating, privatizing, and transferring its
functions. Another proposal contemplates that, rather than providing specific
project-based subsidies, HUD would give qualified participants vouchers to use
at the property of their choice. Since the value of such a voucher would be
fixed, participants electing to move from their present apartment complex would
have to pay the difference between such voucher value and the rent at an
alternative property. Due to a relative lack of amenities in most HUD projects,
residents (if they could afford the price differential) might be inclined to
move from such projects into complexes with more amenities. If such residents
could not be replaced, the occupancy level or rental rates of such project could
be affected and, accordingly, the management fee paid to the property manager
could be reduced. The current proposals with regards to the reorganization are
not sufficiently specific to determine their actual impact, if any, on
management fee revenue paid to Insignia by HUD properties. There can be no
assurance that the proposed changes would not have a material adverse impact on
Insignia's business or financial condition.
SELLING STOCKHOLDERS
The following table sets forth certain information as of the date of this
Prospectus with respect to the Selling Stockholders. All of the shares to be
sold by the Selling Stockholders represent shares which may be acquired by them
on exercise of certain warrants issued to them as employees of the Company. The
Company will receive the exercise price on any such exercise but will not
receive any of the proceeds from the sale of such shares. Each of the Selling
Stockholders is an officer of the Company as indicated below. Based on
information provided by the Selling Stockholders, as of December 1, 1996, Andrew
L. Farkas beneficially owned 28.4% and James A. Aston beneficially owned 1.3%,
respectively, of the outstanding Common Stock. Beneficial ownership after the
offering will depend on the number of shares sold by each Selling Stockholder.
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<PAGE>
Beneficial Number
Selling Stockholder and Positions with Ownership of Shares
Insignia Prior to Offering Offered
Andrew L. Farkas 8,442,722(1) 628,000
Chairman of the Board of Directors,
President and Chief Executive Officer
James A. Aston 371,518(2) 100,000
Office of the Chairman and Chief
Financial Officer
_______________
(1) Includes shares owned by (i) Metropolitan Acquisition Partners IV, L.P.
("MAP IV"), (ii) Metropolitan Acquisition Partners V, L.P. ("MAP V"), (iii)
Metro Shelter Directives, Inc. and MV, Inc., the general partners of MAP IV
and MAP V, respectively, (iv) certain stockholders who have granted proxies
to MAP IV and MAP V, and (v) certain stockholders who are party to a
stockholders agreement with Andrew L. Farkas. Includes 928,000 shares, of
which 628,000 are subject to this Registration Statement, which are subject
to options and warrants.
(2) Includes (i) 217,890 shares subject to options which are exercisable or
will become exercisable within 60 days, (ii) 100,000 shares which are
subject to this Registration Statement, of which 66,668 are subject to
warrants which are exercisable within 60 days and (iii) 20,000 shares owned
by Mr. Aston's spouse, for which Mr. Aston disclaims beneficial ownership.
The sale of the shares by the Selling Stockholders may be effected from
time to time in transactions (which may include block transactions by or for the
account of the Selling Stockholders) on the NYSE or in negotiated transactions,
through the writing of options on such shares, a combination of such methods of
sale, or otherwise. Sales may be made at fixed prices which may be changed, at
market prices prevailing at the time of sale, or at negotiated prices.
Selling Stockholders may effect such transactions by selling their shares
directly to purchasers, through broker-dealers acting as agents for the Selling
Stockholders, or to broker-dealers who may purchase shares as principals and
thereafter sell the shares from time to time on the NYSE in negotiated
transactions, or otherwise. Such broker-dealers, if any, may receive
compensation in the form of discounts, concessions, or commissions from the
Selling Stockholders and/or the purchasers for whom such broker-dealers may act
as agents or to whom they may sell as principals or both (which compensation as
to a particular broker-dealer may be in excess of customary commissions).
The Selling Stockholders and broker-dealers, if any, acting in connection
with such sale might be deemed to be "underwriters" within the meaning of
Section 2(11) of the Securities Act and any commission received by them and any
profit on the resale of such shares might be deemed to be underwriting discounts
and commissions under the Securities Act.
P-13
<PAGE>
LEGAL OPINIONS
The validity of the shares of Common Stock offered hereby will be passed
upon for Insignia and the Selling Stockholders by Proskauer Rose Goetz &
Mendelsohn LLP, New York, New York. The wife of a partner of Proskauer Rose
Goetz & Mendelsohn LLP is a limited partner in each of two of Insignia's
principal stockholders.
EXPERTS
The consolidated financial statements of Insignia Financial Group, Inc.
appearing in Insignia's Annual Report (Form 10-K) for the year ended December
31, 1995, have been audited by Ernst & Young LLP, independent auditors, as set
forth in their report thereon included therein and incorporated herein by
reference. Such financial statements are, and audited financial statements to be
included in subsequently filed documents will be, incorporated herein in
reliance upon the reports of Ernst & Young LLP pertaining to such financial
statements (to the extent covered by consents filed with the Securities and
Exchange Commission) given upon the authority of such firm as experts in
accounting and auditing.
The combined balance sheets of Edward S. Gordon Company, Incorporated and
Edward S. Gordon Company of New Jersey, Inc. as of December 31, 1995 and 1994,
and the related combined statements of operations, shareholders' equity and cash
flows for each of the years ended December 31, 1995, 1994 and 1993 incorporated
by reference in this Registration Statement have been incorporated herein in
reliance on the report of Coopers & Lybrand L.L.P., given upon the authority of
that firm as experts in accounting and auditing.
The combined consolidated balance sheets of NPI Property Management
Corporation, Inc. and Subsidiaries, National Property Investors, Inc. and
Subsidiaries and NPI-CL Management L.P. as of June 30, 1995 and 1994, and the
related combined consolidated statements of operations and cash flows for the
years then ended and the consolidated statement of operations and cash flows of
National Property Investors, Inc. for the year ended June 30, 1993, incorporated
herein by reference have been audited by Coopers & Lybrand L.L.P., independent
auditors, as set forth in their reports thereon and are incorporated herein by
reference in reliance upon such reports given upon the authority of such firm as
experts in accounting and auditing.
The financial statements of the NPI Partnerships appearing in Insignia's
Current Report on Form 8-K dated September 1, 1995 and appearing in Insignia's
Current Report on Form 8-K dated December 10, 1996 have been audited by Imowitz
Koenig & Co., LLP as set forth in their reports included therein and
incorporated herein by reference in reliance upon such reports given upon the
authority of such firm as experts in accounting and auditing.
No dealer, salesperson, or any other person has been authorized to give any
information or make any representations not contained in this Prospectus and, if
given or made, such information or representations must not be relied upon as
having been authorized by Insignia or any Selling Stockholder. This Prospectus
does not constitute an offer of any securities other than those to which it
relates or an offer to sell, or a solicitation of an offer to buy, to any person
in any jurisdiction where such an offer or solicitation would be unlawful.
Neither the delivery of this Prospectus nor
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<PAGE>
any sale made hereunder shall, under any circumstance, create any implication
that the information contained herein is correct as of any time subsequent to
the date hereof.
P-15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that is has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Greenville, State of South Carolina, on this 13th day
of December, 1996.
INSIGNIA FINANCIAL GROUP, INC.
By: /s/ John K. Lines
---------------------
John K. Lines
General Counsel and
Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signatures Title Date
/s/ Andrew L. Farkas* Officer and Director December 13, 1996
--------------------
Andrew L. Farkas (Principal Executive Officer)
/s/ James A. Aston Chief Financial Officer December 13, 1996
------------------
James A. Aston (Principal Financial and
Accounting Officer)
/s/ Robert J. Denison* Director December 13, 1996
----------------------
Robert J. Denison
/s/ Robin L. Farkas* Director December 13, 1996
--------------------
Robin L. Farkas
/s/ Merril M. Halpern* Director December 13, 1996
- ----------------------
Merril M. Halpern
/s/ John F. Jacques* Director December 13, 1996
--------------------
John F. Jacques
/s/ Robert G. Koen* Director December 13, 1996
-----------------------
Robert G. Koen
/s/ Michael I. Lipstein* Director December 13, 1996
------------------------
Michael I. Lipstein
II-5
<PAGE>
Signatures Title Date
/s/ Buck Mickel* Director December 13, 1996
---------------- -------- -----------------
Buck Mickel
*By /s/ John K. Lines
- ---------------------
John K. Lines
Attorney-in-fact
II-6
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-8) and related Prospectus on Form S-3 of Insignia
Financial Group, Inc. for the registration of 728,000 shares of its common stock
and to the incorporation by reference therein of our report dated February 21,
1996, with respect to the consolidated financial statements of Insignia
Financial Group, Inc. included in its Annual Report (Form 10-K) for the year
ended December 31, 1995, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Greenville, South Carolina
December 11, 1996
II-7
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement
on Form S-8 of our report dated April 1, 1996, on our audits of the combined
financial statements of Edward S. Gordon Company, Incorporated and Edward S.
Gordon Company of New Jersey, Inc. as of December 31, 1995 and 1994 and for each
of the years ended December 31, 1995, 1994 and 1993. We also consent to the
reference to our firm under the caption "Experts."
/s/ COOPERS & LYBRAND L.L.P.
New York, New York
December 12, 1996
II-8
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement
on Form S-8 of our report dated August 18, 1995, on our audits of the combined
consolidated balance sheets of NPI Property Management Corporation, Inc.,
National Property Investors, Inc. and NPI-CL Management L.P. as of June 30, 1995
and 1994, and the related combined consolidated statements of operations and
cash flows for the years then ended, and the consolidated statements of
operations and cash flows of National Property Investors, Inc. ("NPI Florida"
see Note 1 to the financial statements referenced herein) for the year ended
June 30, 1993. We also consent to the reference to our firm under the caption
"Experts."
/s/ COOPERS & LYBRAND L.L.P.
Atlanta, Georgia
December 12, 1996
II-9
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) of Insignia Financial Group, Inc. of our reports dated January 18,
1995, January 13, 1995, January 11, 1995, January 20, 1995, January 20, 1995,
February 1, 1995, January 16, 1995, February 6, 1995, January 28, 1995, January
21, 1995, January 20, 1995, February 1, 1995, January 20, 1995 and January 18,
1995 with respect to the financial statements of National Property Investors II,
National Property Investors III, National Property Investors 4, National
Property Investors 5, National Property Investors 6, National Property Investors
7, National Property Investors 8, Century Properties Fund XIV, Century
Properties Fund XV, Century Properties Fund XVI, Century Properties Fund XVII,
Century Properties Fund XVIII, Century Properties Fund XIX and Century
Properties Growth Fund XXII, respectively, included in the Current Report on
Form 8-K of Insignia Financial Group, Inc. filed with the Securities and
Exchange Commission on September 1, 1995. We consent to the incorporation by
reference in the Registration Statement (Form S-8) of Insignia Financial Group,
Inc. of our reports dated January 22, 1996, January 23, 1996, January 30, 1996,
January 22, 1996, January 31, 1996, January 22, 1996, January 22, 1996, February
12, 1996, except for Notes 10 and 11, which are dated March 7, 1996, February 4,
1996, January 22, 1996, January 26, 1996, January 22, 1996, February 20, 1996
and January 23, 1996 with respect to the financial statements of National
Property Investors II, National Property Investors III, National Property
Investors 4, National Property Investors 5, National Property Investors 6,
National Property Investors 7, National Property Investors 8, Century Properties
Fund XIV, Century Properties Fund XV, Century Properties Fund XVI, Century
Properties Fund XVII, Century Properties Fund XVIII, Century Properties Fund XIX
and Century Properties Growth Fund XXII, respectively, included in the Current
Report on Form 8-K of Insignia Financial Group, Inc. filed with the Securities
and Exchange Commission on December 10, 1996. We also consent to the reference
to our firm under the caption "Experts."
/s/ IMOWITZ KOENIG & CO., LLP
New York, New York
December 12, 1996
II-10
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below constitutes and appoints Andrew L. Farkas, James A. Aston and John K.
Lines, and each of them, his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, to act, without the other, for
him and in his name, place, and stead, in any and all capacities, to sign a
Registration Statement on Form S-8 of Insignia Financial Group, Inc., and any or
all amendments (including post-effective amendments) thereto, relating to the
offering of shares of its Class A Common Stock, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as full to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, their
substitute or substitutes may lawfully do or cause to be done by virtue hereof.
/s/ Andrew L. Farkas /s/ John F. Jacques
- -------------------- -------------------
Andrew L. Farkas John F. Jacques
/s/ Robert J. Denison /s/ Robert G. Koen
- --------------------- ------------------
Robert J. Denison Robert G. Koen
/s/ Robin L. Farkas /s/ Michael I. Lipstein
- ------------------- -----------------------
Robin L. Farkas Michael I. Lipstein
/s/ Merril M. Halpern /s/ Buck Mickel
- --------------------- ---------------
Merril M. Halpern Buck Mickel
Insignia Financial Group, Inc.
December 12, 1996
Page 1
EXHIBIT 5
December 12, 1996
Insignia Financial Group, Inc.
One Insignia Financial Plaza
Greenville, NC 29602
Dear Sirs:
We are acting as counsel to Insignia Financial Group, Inc., a Delaware
corporation (the "Company"), in connection with the Registration Statement on
Form S-8 with exhibits thereto (the "Registration Statement") filed by the
Company under the Securities Act of 1933 (the "Act"), relating to the
registration of 728,000 shares (the "Shares") of Class A Common Stock, par value
$0.01 per share, of the Company. The Shares are issuable by the Company upon
exercise of certain warrants (the "Warrants") granted to certain employees of
the Company.
We have examined and relied upon originals or copies, certified or
otherwise authenticated to our satisfaction, of all such corporate records,
documents, agreements and certificates of public officials and of
representatives of the Company, and have made such investigation of law and
fact, as we have deemed proper and necessary for purposes of this opinion.
Based upon, and subject to, the foregoing, we are of the opinion that the
Shares are duly authorized and, upon exercise of the Warrants in accordance with
their terms against payment of the exercise price thereunder, will be validly
issued, fully paid, and non-assessable.
<PAGE>
Insignia Financial Group, Inc.
December 12, 1996
Page 2
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement. In giving the foregoing consent, we do not admit that we
are in the category of persons whose consent is required under Section 7 of the
Act.
Very truly yours,
Proskauer Rose Goetz & Mendelsohn LLP
By /s/ Allan Williams
