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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 June 30, 1996
______________________
Commission File No. 33-39238
TMP LAND MORTGAGE FUND, LTD.
A CALIFORNIA LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
CALIFORNIA 33-0451040
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
801 North Parkcenter Drive, Suite 235 92705
Santa Ana, California (Zip Code)
(Address of principal executive office)
(714) 836-5503
(Registrant's telephone number, including area code)
______________________
Indicate by check mark whether Registrant has [1] 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 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 [ ]
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The following financial statements are filed as a part of this Form 10-Q:
Balance Sheets as of June 30, 1996 and December 31, 1995
Statements of Income for the three months ended June 30, 1996 and 1995
and for the six months ended June 30, 1996 and 1995
Statements of Cash Flows for the six months ended June 30, 1996 and 1995
The accompanying unaudited interim financial statements include all
adjustments (consisting solely of normal recurring adjustments) which are,
in the opinion of the General Partners, necessary to fairly present the
financial position of the Partnership as of June 30, 1996 and the results
of its operations, changes in partners' equity, and cash flows for the
three month period then ended.
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TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
<TABLE>
<CAPTION>
Balance Sheets
March 31, 1996 December 31, 1995
<S> (Unaudited) (Audited)
Assets <C> <C>
Cash $ 5,534 $ 81,957
Mortgage Loans on Real Estate 2,000,000 3,320,000
Property Held for Sale 12,953,852 9,633,530
Accounts Receivable 1,367 24,285
Investment in Joint Venture 1,368,115 1,325.770
----------- -----------
Total Assets $16,328,868 $ 14,385,542
Liabilities and Partners Capital
Accounts Payable $ 0 $ 17,475
Taxes Payable 2,646,322 762,271
Due to Affiliates 11,833 66,277
------------ ---------
Total Liabilities $ 2,658,185 $ 846,271
Partners' Capital
General Partners $ (20,495) (21,808)
Limited Partners 20,000 equity
units authorized; 15,715 units
outstanding as of June 30, 1996 and
December 31, 1995 $ 13,650,188 $ 13,561,327
Total Partners' Capital $ 13,670,683 $ 13,539,519
</TABLE>
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TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
<TABLE>
<CAPTION>
STATEMENTS OF INCOME
(Unaudited)
For the Three Months Ended For the Six Months Ended
June 30, June 30,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Income
Interest Income $ 28 $159,890 $ 66,751 $ 408,102
Joint Venture Income 9,771 0 63,784 0
Other Income 300 0 1,800 0
--------- --------- -------- ---------
Total Income $ 10,098 $159,890 $132,335 $ 408,102
Expenses
Outside Services $ 0 $ 3,381 $ 1,020 $ 24,333
Joint venture Expense 0 0 151 0
------- --------- --------- ---------
Total Expenses $ 0 $ 3,381 $ 1,171 $ 24,332
Net Income $ 10,098 $ 156,509 $ 131,163 $ 383,770
=========== =========== ========== =========
Allocation of Net Income
General Partners
in the Aggregate: $ 101 $ 1,565 $ 1,312 $ 3,838
Limited Partners
in the Aggregate: $ 9,997 $ 156,944 $ 129,851 $ 379,932
Limited Partners
per equity unit: $ .64 $ 9.86 $ 8.26 $ 24.18
</TABLE>
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TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the Six Months Ended June 30
1996 1995
<S> <C> <C>
Cash Flow Used in Operating activities:
Net Income $131,164 $383,770
Adjustments to reconcile net income
to net cash provided by operating activity:
Increase (Decrease) in Accounts payable $ (17,475) 114,032
Increase (Decrease) in Accrued Expenses 1,829,637 724,835
Decrease (Increase) in Loans Receivable 1,320,000 399,875
Increase in Carrying cost of Properties (3,362,667) 1,281,121)
Decrease (Increase) in Accounts Receivable 22,918 (2,756)
Net Cash provided by (used in)
operating activities $ (207,587) $ 326,971
Cash flow from financing activities:
Distributions to partners $ 0 $ (317,315)
Capital contributions from partners 0 0
Net cash provided by (used in) financing activities 0 0
Net Increase (Decrease) in Cash $ (76,423) $ 9,656
Cash, beginning of period $ 81,957 $ 43,587
Cash, end of period $ 5,534 $ 53,243
============ ===========
</TABLE>
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TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
for the Three Months Ended June 30, 1996
Note 1 - Summary of Significant Accounting Policies
Accounting Method - TMP Land Mortgage Fund, Ltd. (the Partnership) prepares its
financial statements on the accrual method of accounting.
Allowance for Losses on Loans - No provision has been made for an allowance for
losses on loans.
Income Taxes - The entity is treated as a partnership for income tax
purposes and any income or loss is passed through and taxable at the partner
level. Accordingly, no provision for federal income taxes is provided.
Note 2 - Allocation of Profits, Losses and Cash Distributions
Profits, losses and cash distributions are allocated 99 percent to the limited
partners and one percent to the general partners until the limited partners
have received an amount equal to their capital contributions plus a
cumulative, non-compounded return of eight percent per annum, based on their
adjusted capital account balances. At that point, remaining profits,
losses and cash distributions are allocated 76 percent to the limited
partners and 24 percent to the general partners.
As of June 30, 1996 and 1995, profits, losses and cash distributions were
allocated 99 percent to the limited partners and one percent to the general
partners.
The Partnership had 15,715 units outstanding as of June 30, 1996 and 1995.
Note 3 - Mortgage Loans on Real Estate
The Partnership had made twelve land loans as of June 30, 1996. Three of
the loans had been repaid in full, and nine of the loans had defaulted.
On eight of the defaults which had occurred, the Partnership had acquired
the property securing the loans. On the ninth loan, the Partnership was
in the process of negotiating an extension of the loan while the Borrower
attempted to secure additional funding to repay the loan.
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TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
for the three months ended June 30, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
TMP Land Mortgage Fund, Ltd., is a California Limited Partnership formed
in April, 1992, of which TMP Investments, Inc., a California corporation,
and TMP Properties, a California general partnership, are the General
Partners (the "General Partners"). The Partnership was formed
principally to make short-term loans to unaffiliated parties secured
by first trust deeds on unimproved properties, primarily in the Inland
Empire area of Southern California and in some instances, in other areas of
Southern California, and to provide cash distributions to the Limited
Partners, primarily from interest earned on the mortgage loans. The
Partnership is not a mutual fund or any other type of investment company
within the meaning of, and is not subject to regulations under, the
Investment Company Act of 1940.
As of June 30, 1996, the Partnership had received and accepted subscriptions
of 15,715 Units, representing total subscription proceeds in the amount of
$15,715,000. All proceeds had been committed to the twelve mortgage loan
investments made by the Partnership and to working capital reserves.
During 1992, the Partnership funded five mortgage loans. Four loans
were funded in 1993 and three loans were funded in 1994.
As a consequence of adverse changes in market conditions and other factors,
ten of the twelve loans have defaulted and the Partnership either owns the
property securing the loan or is in negotiation with the Borrower to either
extend the loan or foreclose on the property securing the loan. The
status of the loans and the properties which the Partnership now owns
as a result of the foreclosure proceedings are discussed on the
following pages.
Loan #1 - PR Equities
Loan #2 - PR Equities
The Partnership foreclosed on the property security these loans during 1995
and now owns the property. The current outstanding payments due as a
result of the Mello-Roos tax assessment against the Partnership's lots
taken back in foreclosure is over $2,000,000. This debt, plus the
continuing tax accrual makes the property unsaleable in the current
real estate market. The City of San Jacinto received the overall
appraisal of the properties in the CFD during the first week of July.
The low land values reflected in the appraisal confirmed the General
Partners opinion that the bonds should be restructured, the overall
bonded indebtedness and the annual debt service should be reduced.
A meeting with all of the property owners, the City of San Jacinto and
the bond holders is likely to occur by mid-August. Based on the outcome
of that meeting, the General Partners will make a definitive decision
on whether to proceed with a program to build homes on the lots,
n joint venture with TMP Homes, LLC.
Loan #3 - Frame Loan
Loan was repaid.
Loan #4 - Sunset Crossing
The Partnership acquired this 42 acre commercial site at the off-ramp of
Sunset Crossing and the I-10 Freeway through foreclosure on December 27,
1994. The property has been listed for sale with Caldwell Banker.
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Loan #5 - Fox Olson
The Partnership owns the property at the corner of Newport Avenue and Bradley
Road through foreclosure. CalTrans is in the proceeds of widening Newport
Avenue from 215 to Murietta Avenue and installing sidewalks, curbs and gutters.
New home construction is nearby and the Partnership, in Joint Venture with
TMP Homes, is preparing to build 44 homes on the property acquired via
foreclosure of the Fox-Olson Loan #2. The construction will be financed
through a construction loan from Citizens Bank.
Loan #6 - Environmental Development
The Partnership accepted a deed in lieu of foreclosure and now owns the
property. A Joint Venture with TMP Homes has been formed to build single
family homes on the 181 lots.
Lot development and project engineering plans are 90% complete and nearly
ready to be submitted to the City of San Diego for plan check. TMP Homes
is in the process of negotiating participation agreements with the City for
the offsite improvements on Otay Mesa Road, and is working with San Diego
Gas and electric to determine the plans for the realignment of the 69KV
overhead transmission lines that must be moved to accommodate the
residential development. Architectural and floor plan development
is planned to begin in August. A Meyers Group market survey and
feasibility study indicate that homes can be built and sold at a profit
on this project.
The General Partners would then seek construction financing for the models
and the first phase of production homes. After receiving its full
land base, the Partnership will also receive 75% of any profits generated
from the sale of the houses.
Loan #7- Fox Olson #2
Property on Newport Avenue west of the Interstate 215 is now owned by
the Partnership. TMP Homes has received a construction loan commitment
from Citizens Business Bank to build single family homes on the 45 lots.
The County of Riverside is processing the final subdivision map and it
is anticipated that the map recordation and offsite construction could
commence before November 1996.
Loan # 8 - Singletary
Loan was repaid in December of 1995 and the proceeds were distributed to the
limited partners as a return of capital.
Loan #9 - LaMonte
The Partnership has acquired this 6.5 commercial property through foreclosure
in April, 1996. However, the previous debtor is attempting, through
litigation, to set aside the foreclosure. Counsel for the Partnership
is preparing a motion for a summary judgment against the debtor, which,
if successful, will remove the lis pendens and end the lawsuit.
Loan #10 - Lansing
This loan was repaid to the partnership in September of 1995.
Loan #11 - Rockfield Development
The Partnership provided $100,000 of a total $250,000 loan in participation
with TMP mortgage Income Plus, Ltd. In order to achieve orderly foreclosure,
TMP mortgage Income Plus, Ltd. Became owner of the note and owes TMP Land
Mortgage Fund, Ltd. $100,000. TMP Mortgage Income Plus, Ltd. Has entered
into a joint venture with TMP Homes to build homes on the 29 lots that
secured this loan and the 13 adjacent lots previously acquired by TMP
Mortgage Income Plus through foreclosure.
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Loan 12 - Peppertree
As of June 30, 1996, the Partnership had extended the loan on a
month-to-month basis while the borrower attempted to secured loan approval
from Hawthorne Savings to repay the Partnership. On July 28, 1996, the
Partnership received $1.5 million in principal, together with $138,000
in accrued interest and charges. The loan was approved with contingencies
which include a stipulation that a joint venture be formed between the
debtor and TMP Land Mortgage Fund, Ltd. To build out the property.
The Partnership will hold a $500,000 equity position in the joint venture.
Total interest received on mortgage loans during the first six months of 1996
was $66,751. There were no distributions made to investors during the first
six months of 1996. Distributions to investors began August 1, 1992, and
continued monthly through May 1, 1995. On June 1, 1995, the General
Partners suspended distributions due to the default and subsequent
foreclosure on several of the mortgage loans.
The General Partners intend to meet currently anticipated cash requirements
for at least the next twelve months by first using funds from the repayment of
Loan #12, the Peppertree loan, which was repaid on July 28, 1996. As of
this date, the General Partners had made no decision whether or how much
of the capital balance and interest income would be returned to the
Limited Partners in the form of a distribution. The General Partners
are negotiating with the City of San Jacinto and plan to delay the
payment of the Mello Roos taxes on the property in San Jacinto. In the
meantime, distributions to investors have been suspended and the
Partnership has defaulted on the payment of the Mello-Roos obligations
and the property taxes on these properties.
The Partnership established reserves of approximately 2% of the Partnership's
capital. Some of the capital has been used as partial payment for Mello-Roos
tax liabilities. The Partnership will maintain reserves for working capital
and contingency reserves in an amount as the General Partners deem necessary
for the operation of the business of the Partnership. In addition,
the Partnership may incur indebtedness as necessary for development or
other expenses incurred in holding the properties and/or developing the
property in conjunction with an affiliated development company. The
Partnership is making every effort to develop and/or sell all of the
properties which it holds.
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TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
for the three months ended September 30, 1995
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.
Date: August 10, 1996
TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
By: TMP Investments, Inc., as General Partner
\s\ William O. Passo
By:___________________________________
William O. Passo, President
\s\ Jenny Rex
By:___________________________________
Jenny Rex, Secretary
\s\ Michael Sun
By:___________________________________
Michael Sun, Chief Financial Officer
By: TMP Properties, a California General
Partnership as General Partner
\s\ William O. Passo
By:___________________________________
William O. Passo, General Partner
\s\ Anthony W. Thompson
By:___________________________________
Anthony W. Thompson, General Partner
\s\ Scott E. McDaniel
By ____________________________________
Scott E. McDaniel
