<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20529
---------------------
FORM 10-K
[X] Annual report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (Fee Required) For the fiscal year ended
December 31, 1996
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934. For the transition period from _____________ to
_____________.
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
incorporation or organization) Identification No.)
801 NORTH PARKCENTER DRIVE, SUITE 235 92705
SANTA ANA, CALIFORNIA (ZIP CODE)
(714) 836-5503
(Registrant's telephone number, including area code)
----------------------
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be registered each class is to be registered
N/A N/A
Securities to be registered pursuant to Section 12(g) of the Act:
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class)
Indicate by check mark whether the 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 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 [ ] No [ ]
<PAGE> 2
PART 1
ITEM 1.
BUSINESS
INTRODUCTION
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 to
provide cash distributions on a current basis 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 December
31, 1996, twelve loans had been made by the Partnership.
Beginning April 22, 1992, the Partnership was engaged in the offering of
up to 20,000 units of limited Partnership Units ("Units") at a purchase price of
$1000 per Unit pursuant to a Registration Statement on Form S-11. On April 22,
1994, the Partnership had received and accepted subscriptions of 15,715 Units,
representing total subscription proceeds in the amount of $15,715,000, and the
offering was closed. Upon the conclusion of the offering, all of the
subscription proceeds had been committed to the mortgage loan investments
described below and working capital reserves.
The Partnership was organized to originate and make loans secured by first
deeds of trust (commonly known as "mortgages") on unimproved real properties
primarily in the Inland Empire area of Southern California, which is located
approximately 60 miles east of the city of Los Angeles and 40 miles north of the
City of San Diego. Twelve loans were make for terms of between 6 months and 36
months. The Partnership does not intend to make any further loans other than
those described below. Each loan was make to an unaffiliated borrower who (i)
paid a fee or "points" to obtain the loan, (ii) established a reserve that would
secure the payment of the interest for the interim term of the loan, and (iii)
was to pay the entire principal amount of the loan in one lump sum payment,
commonly referred to as a "balloon" payment, at the end of the loan term. Each
loan was made to an unaffiliated borrower who (i) used the proceeds of the loan
to purchase or refinance a property the General Partners believe has development
potential; (ii) "predevelop" the property by obtaining zoning and other
governmental approvals needed to permit construction of single or multi-family
residences or commercial buildings on the property ("predevelopment work") and
(iii) on completion of the predevelopment work, will either sell the property to
developers or contractors or obtain new financing on the property.
It was intended that the Partnership's loans would be repaid from the
proceeds either of the sale or a refinancing of the property by the borrower.
The Partnership does not participate in any profit that the borrower may realize
on the sale or refinancing of the property. Instead, the Partnership would
receive from the proceeds of the sale or refinancing, the principal amount of
the Partnership's loan and any interest that had been earned, but not paid,
through the date of sale or refinancing.
As a consequence of adverse changes in market conditions and other
factors, nine of the twelve loans made by the Partnership to date have been
foreclosed upon. In the event of foreclosure, the property securing the loan is
put up for public sale approximately four to six months after initiation of
foreclosure proceedings and is sold to the highest bidder. The sales proceeds
then are paid to the first mortgagee, which would be the Partnership, until the
principal amount of its loan, earned but unpaid interest, and foreclosure costs
are repaid. Any surplus then remaining is paid to the borrower. If no one offers
a cash price sufficient to enable the Partnership to recover its investment, the
Partnership, as first mortgagee, is entitled to acquire the property in exchange
for cancellation of the amounts owned by the borrower. In that event, the
General Partners' strategy is to complete any predevelopment work not completed
by the Borrower and to attempt to sell the property for a price that would at
least enable the Partnership to recover
<PAGE> 3
its investment in the property. To date, the Partnership has acquired each of
the properties on which it has foreclosed.
The Partnership's investment in a foreclosed property generally consists
of all amounts owing by the borrower to the Partnership that were secured by the
Partnership's mortgage at the time it acquired the property, the amounts
expended to acquire and then to complete predevelopment of the property and,
unless paid out of the gross proceeds of sale, any expenses incurred to sell the
property. Any cash proceeds in excess of the investment will be distributed to
the Partners.
The Partnership will be terminated as soon as practicable after July 31,
1997 following liquidation of the Partnership assets and distributions of cash
to the Partners. However, the Partnership will not be terminated until mortgage
loans made by it have been repaid and all properties and other assets owned by
it have been sold and payment of the purchase price for those assets is received
or converted into cash. At this time, it is unlikely that the Partnership will
be terminated within the next twelve months.
DEVELOPMENT POTENTIAL OF UNDERLYING PROPERTIES. The Partnership made loans
to borrowers seeking to acquire or refinance, predevelop and then sell,
undeveloped properties in the Inland Empire to developers and contractors. In
most cases, the repayment of the Partnership's loans will depend on the ability
of the borrower (or the Partnership if a foreclosure occurs) to sell or
refinance the property after predevelopment work is completed. Accordingly, one
of the critical factors that affect the ability of the Partnership to achieve
its investment objectives is the potential value and salability of the
properties which secure repayment of the Partnership's loans or which the
Partnership has acquired through foreclosure.
Each loan made by the Partnership is secured by a first mortgage. In the
event of a foreclosure sale, if the property is sold for at least the amount
owned to the Partnership, the entire sales proceeds must be paid to the
Partnership, as first mortgagee, before any proceeds may be paid to anyone else.
If there are no other purchasers, or the other purchase offers made at the
foreclosure sale are not sufficient to pay off the amounts owed to the
Partnership, as first mortgagee the Partnership is entitled to acquire the
property in exchange for cancellation of the amounts owed by the borrower. Under
applicable laws, on any such acquisition, any other mortgages, liens or
encumbrances on the property will be automatically terminated and the
Partnership will own the property free and clear and will have no payment
obligations thereafter, other than (i) the costs of completing any
predevelopment work not completed by the borrower; and (ii) property taxes that
are assessed against the property after the Partnership's acquisition of the
property; and (iii) in some instances special assessment district taxes which
are assessed against the property.
There may be circumstances in which, despite a default, the General
Partners will choose not to initiate foreclosure proceedings immediately. For
example, there may be ongoing sales negotiations or a refinancing may be in
process that would be disrupted by the initiation of foreclosure proceeding or
the General Partners may conclude that the borrower-owner is better able to
complete predevelopment and to sell the property than the Partnership. There
also may be instances in which the General Partners choose not to purchase a
property at the foreclosure sale, even though the Partnership might sustain a
partial or even total loss of the investment on the loan. For example, it may be
preferable to accept a cash purchase offer for the property which is less than
the amount owed on the loan, but which would enable the Partnership to recover
immediately, in cash, the substantial portion of its investment in the loan.
There could also be circumstances in which environmental problems on a property
discovered after loan is made, would make it prudent for the Partnership not to
acquire a property. However, the General Partners believe such a circumstance
would be a rare occurrence.
POSSIBLE CHANGES IN MORTGAGE LOAN POLICIES. The General Partners reserve
the right, without the consent of the Limited Partners, to alter the proposed
policies for mortgage investments to the extent that the General Partners
believe that variation from the policies will be in the best interests of the
Partnership.
<PAGE> 4
EXPANSION OF PRIMARY BUSINESS OBJECTIVES
To offset the potential for loss on the resale of the properties taken
back in foreclosure, the General Partners, in December of 1995, determined that
it would be in the best interest of the Partnership to use Partnership reserves
to engage in a joint venture with an unrelated company, Steadfast HSC, LLC, to
acquire the Hollywood Studio Club Apartments ("HSC"), a 243 unit apartment
complex in Hollywood, California for $6,325,000. In March 1997, HSC was sold for
$8,600,000. Based on an investment of $854,474, the Partnership received a
preferential return of approximately $168,000 and profits of approximately
$486,000.
MORTGAGE LOAN INVESTMENTS
As of December 31, 1996, the Partnership had made twelve mortgage loans.
The status of such loans and other relevant information are summarized below.
PR EQUITIES, LTD. LOANS
The Partnership made two loans ("Loan 1" and "Loan 2") to PR Equities,
Ltd., a California limited partnership. The loans were secured by first trust
deeds on property under predevelopment in San Jacinto, Riverside County,
California. Loan 1 was secured by a first deed of trust on 304 tentative map
lots in 5 separate tracts in Phase II of the Rancho San Jacinto master-planned
community located in the City of San Jacinto, California. Phase 1, consisting of
six parcels and 797 single family dwelling lots, was sold to merchant builders.
Loan 2 was secured by a first deed of trust on two tracts containing 148
tentative map lots which also are part of Phase II of the Rancho San Jacinto
master-planned community. Theses properties received approval of tentative tract
maps which, upon final approval, would divide them into lots suitable for
construction of single family residences. All of the properties are located east
of Hewitt Street and north of Washington Avenue in San Jacinto, Riverside
County, in Southern California.
The Partnership foreclosed on the property securing 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 was
held in September with the property owners and the bond holders, and as a result
of this meeting, the City of Rancho San Jacinto has hired an independent bond
advisor to negotiate the restructuring terms with the bond holders. The City
Council of Rancho San Jacinto is attempting to include the current home owners
with the land owners and developers in the negotiations for the proposed bond
reduction and restructuring. Based on the outcome of the negotiations, the
General Partners will make a definitive decision on whether to proceed with a
program to build homes on the property.
While the General Partners are pursuing these options, the City has been
forced by the terms of the bonds to schedule a sale of the property for
delinquent bond assessments. This sale requires the buyer to pay the full unpaid
assessment, penalties, interest and assume the full amount of the remaining
assessment and make all future payments as they come due. The cost of completion
of the lots, if added to remaining unpaid assessment, exceeds what the market
will bear today. For that reason, the General Partners do not expect to see
anyone offer to buy at the sale. The General Partners plan to redeem the 92 lots
if it appears that someone else may buy the property.
The General Partners anticipate that construction of homes on a portion of
the property will make the remainder of the property more attractive to other
builders.
<PAGE> 5
FRAME LOAN
The Partnership made a third loan ("Loan 3") to Richard D. Frame, an
individual. Loan 3 was secured by a first trust deed to property under
predevelopment in Temecula, Riverside County, California. This loan matured on
February 8, 1994. The loan was extended to April 20, 1994, at which time the
Partnership received payment in full. Part of the proceeds were reloaned in the
Peppertree and Rockfield loans. The balance was added to Partnership reserves.
SUNSET CROSSING LOAN
The Partnership made their fourth loan ("Loan 4") to Sunset Crossing I, a
California Limited partnership. Loan 4 was secured by a first trust deed to
property under predevelopment in Banning, Riverside County, California.
In August of 1994, this loan defaulted.
The property now owned by the Partnership through the default on Loan 4 is
located at the southwest corner of the intersection of Interstate Freeway 10 and
Sunset Avenue in Banning, Riverside County, California. The property consists of
42.47 acres; five acres are currently zoned commercial and the balance is
industrial.
Since the Partnership foreclosed on the property in August of 1994, the
General Partners have contacted Wal-Mart, the City of Banning, and two Wal-Mart
Shopping Center Developers to determine the extent of continued interest in the
property. TMP Land Mortgage Fund is trying to have the City extend the Sales Tax
Revenue Sharing measure adopted when the loan was made, in the hope that
Wal-Mart will acquire and develop part of the property. The General Partners
have been told that Wal-Mart believes the property will not be ready for
development for another 12 -18 months in light of current market conditions, but
indicates that it remains interested in the property.
FOX-OLSON LOAN
The Partnership's fifth loan ("Loan 5") was made to Marilyn Fox-Olson, an
individual. Loan 5 is secured by a first deed of trust on 10.84 acres of land in
Sun City/Menifee Valley, Riverside County.
Loan 5 was secured by a first trust deed to 10.84 acres of commercially
zoned land at the northeast corner of Newport Road and Bradley Road in the
unincorporated area of Riverside County known as Sun City/Menifee Valley. The
property is well-suited for a shopping center with a supermarket anchor and a
corner pad for either a gas station or a fast food restaurant. The Borrower has
such a site plan approved by the Riverside County Planning Commission, but that
approval has now expired. The intersection of Newport and Bradley Roads is
controlled by a traffic signal and is about a mile west of the I-215 Freeway.
Adjacent to the south of the subject property is a large proposed
mixed-use project with an approved Specific Plan called Menifee Meadows. That
project, if built, will include condominiums, apartments, single-family
residences, an office park, retail center, and parks. A new elementary school
was opened there in 1991.
The current zoning for the subject property is C-1/C-P (General retail and
commercial). The soils report is favorable for development. No faults exist on
or near the property. The site has about 389 feet of frontage on Newport Road,
for which the County has formed an assessment district to widen and improve to
six lanes of traffic to accommodate the current and future traffic. Newport Road
will be a major east-west arterial road connecting the I-15 and I-215 Freeways.
A Phase 1 Environmental (toxic) study was performed by a qualified engineer and
the site is clean of hazardous wastes. The site is vacant, raw land that has
never been developed. The topography is level, with a very gentle slope down to
the north. All utilities are available to the site.
<PAGE> 6
The Partnership took title to this property in November of 1994. The
property is listed for sale at $1,550,000.
ENVIRONMENTAL DEVELOPMENT, LTD.
The Partnership's sixth loan ("Loan 6") was to Environmental Development,
Ltd., a California Limited Partnership. Loan 6 was secured by a first trust deed
to property under predevelopment in San Diego, California.
The Borrower defaulted on the loan in October of 1994. An extension
agreement was signed by Borrower, wherein the Partnership agreed to extend the
term of the loan to May 1, 1995. Borrower was to make all monthly interest
payments, with points and servicing fees added to the principal of the loan.
However, on March 1, 1995, the Borrower defaulted in the payment of interest
due, and the Partnership filed of Notice of Default and subsequently accepted
Deed in Lieu of foreclosure on the property and now holds title to the property.
This property is approximately 52 acres of residentially zoned land at the
southeast quadrant of State Route 905 and Interstate 805 Freeways in the Otay
Mesa area of the City of San Diego. The existing zoning is A1-10 (0-5 units per
acre). The topography is gentle to moderate slopes, mostly southwest facing,
providing distant (approximately 5 miles) white water views of the Pacific
Ocean, San Diego Bay, and the San Diego downtown skyline. The site is only three
miles north of the Mexican border crossing a San Ysidro.
The 52 acres are a portion of the 78.3 acre Remington Hills Precise Plan,
designed for low to moderate priced single-family homes, with no multi-family or
commercial. The Precise Plan and tentative map has been processed and approved.
An Environmental Impact Report is required, with most of the studies completed.
Sewer and water is within 200 feet of the site, with adequate capacity. Natural
gas and electricity are also available. The subject 52 acre portion of Remington
Hills is designed so it can be developed first and stand alone from the
remaining portion. The Environmental Impact Report was approved in 1995.
The tentative map for 181 lots was approved on July 18, 1995, after 5
years of processing. The General Partners have determined that construction of
homes will achieve the highest return to the Partnership. The determination is
based in part on the results of a market feasibility study commissioned by the
Partnership for The Meyers Group, and also in part on the terms of a Joint
Venture Agreement with TMP Homes that will direct the major portion of all sales
proceeds and profits to the Partnership. A Joint Venture has been formed and
actual construction is expected to commence in late 1997.
FOX-OLSON LOAN #2
On June 17, 1993, the Partnership funded its seventh mortgage loan, ("Loan
7") to Marilyn Fox-Olson. Loan #7 was funded on June 17, 1993 and was due on
December 17, 1994. At that time, the Borrower went into default and the
Partnership initiated foreclosure proceedings. Title to this property reverted
to the Partnership on March 29, 1995. The General Partners are making every
effort to market this property and have been approached by several investors
expressing interest in acquiring this property.
Loan #7 is secured by a first deed of trust on 45 lots of residential land
and a 1.84 acre commercial site located in Menifee, California. The Partnership,
together with TMP Homes, has formed a Joint Venture to build homes on this site,
with the major portion of the profit from the sale of the homes going to the
Partnership. TMP Homes is attempting to procure a construction loan for the
project.
<PAGE> 7
SINGLETARY LOAN
On October 12, 1993, the Partnership funded it eighth mortgage loan ("Loan
8"). The loan was secured by a first deed of trust on 96 acres of
industrial/commercial land located in the unincorporated area of Riverside
County known as Rubidoux. The loan came due on April 12, 1995. The borrower
sought to extend the loan, and did pay extension fees and additional interest
for several months. However, the Partnership was forced to file a Notice of
Default when the borrower ceased making payments. The Borrower filed for
personal bankruptcy in order to forestall foreclosure proceedings. After months
of negotiations, the borrower was able to procure additional financing and paid
the loan in full, with all interest owing, on December 13, 1995. This allowed
for a distribution of $2,200,000 to all limited partners.
LAMONTE LOAN
On October 25, 1993 the Partnership funded its ninth loan ("Loan 9")
secured by a first deed of trust on 6.54 acres of commercial land located in the
City of Simi Valley, County of Ventura, California.
This loan bore an interest rate of 12.5%. To facilitate payment, Borrower
deposited an amount equal to twelve months interest due on the loan in a
segregated bank account at Frontier Bank, La Palma, California. This represents
the last twelve months interest. The first six months of interest was paid by
Ventura Pacific Capital Group, a developer who has an Option Agreement and
Ground Lease Agreement with the LaMontes on the subject property. Ventura
Pacific was paying Mr. and Mrs. LaMonte $18,400 per month the ground lease. The
monthly payment on the loan from the Borrowers is $12,708 and Ventura Pacific
paid that portion of the Ground Lease directly to the Partnership for the first
six months of the loan term.
The principal amount of the Loan matured on April 25, 1995. After the
Partnership file a Notice of Default, the borrower transferred the property to a
wholly owned corporation and had the corporation file a Chapter 11 proceeding to
delay a foreclosure. The Partnership succeeding in having the Bankruptcy Court
remove the stay after a contestual Law and Motion Proceeding. The borrower then
filed a state court action asking the court for a temporary injunction based on
alleged irregularities during the foreclosure process. The Partnership acquired
the property through foreclosure in April 1996.
Loan 9 is secured by a first trust deed to 6.54 acres in the City of Simi
Valley, County of Ventura, California. The property is part of the Royal Madeira
Specific Plan area that consists of approximately 29.1 gross acres of
undeveloped land. The property is zoned commercial/recreational (C-R) which
allows for limited commercial uses that provide for the development of
recreational, entertainment and associated retail and service activities.
Ventura Pacific Capital Group VIII, a California Limited Partnership, has
proposed to develop the property in conjunction with the adjacent 6.8 acres
which Ventura Pacific Capital Group currently owns. To that end, significant
engineering and other entitlement work has been completed which includes an
approved development plan for a recreational facility, including an ice rink,
and also for an Albertsons Grocery store, Sav-On Drug and related shop space
users. the previous debtor is attempting, through litigation, to set aside the
foreclosure. The judge has refused to dismiss the petition filed by the General
Partners to remove the lis pendens and end the lawsuit. A cash offer to purchase
the property was received from Lucky's Food Stores in the amount of $1.6
million. Acceptance is delayed until clear title can be achieved.
GREGORY P. LANSING AND JANICE A. LANSING, TTEES OF THE GPLJAL FAMILY TRUST
On March 23, 1994, the Partnership funded it tenth loan ("Loan 10")
secured by a first deed of trust on 28.42 acres of land located in the City of
Murietta, County of Riverside, California.
<PAGE> 8
The collateral for this Loan was approximately 28.42 acres of commercially
zoned land at the northwest corner of Murietta Hot Springs Road and Jefferson
Avenue in the City of Murietta in the western part of Riverside County,
California.
The loan was repaid on September 5, 1995. Proceeds were added to cash
reserves of the Partnership.
ROCKFIELD LOAN
On June 1, 1994, the Partnership funded its eleventh loan, ("Loan 11")
secured by a first deed of trust on 41 residential lots in Rancho Cucamonga,
County of Riverside, California.
This loan was in participation with TMP Mortgage Income Plus, Ltd., a
private syndication of which TMP Investments, Inc. and TMP Properties also serve
as General Partners. The total loan of $250,000 was funded $100,000 by TMP Land
Mortgage Fund, Ltd. and $150,000 by TMP Mortgage Income Plus, Ltd.
The principal amount of the Loan was due and payable in a lump sum or
"balloon" payment on March 1, 1995. After several extensions of the due date,
the Borrower defaulted and the property was foreclosed on January 15, 1996. the
Partnership has sold it interest in the property to TMP Mortgage Income Plus,
Ltd. for the amount of its participation in the loan, as well as monies which
the Partnership has advanced to pursue development of this property. 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.
PEPPERTREE LAND COMPANY LOAN
On June 28, 1994, the Partnership funded it twelfth loan, ("Loan 12")
secured by a first deed of trust on 193 single family residential lots and a
third trust deed on 73 single family residential lots and 15 acres
office/professional use land in Fallbrook, San Diego County, California.
The principal amount of the Loan is due and payable, in a lump sum payment
12 months from the date of the funding of the loan, which was June 28, 1995.
However, the loan agreement called for an extension of an additional 6 months by
written notice to the Lender within 30 days of the due date of the Note. The
interest impound was for the full 18 months and provided that should the
borrower repay the loan within the 12 month period, all unused interest should
be returned to Borrower.
The collateral for this loan is a First Trust Deed on 193 single family
residential lots; and a third Trust Deed on 73 single family residential lots
and a Third Trust Deed on approximately 15 acres of office/professional use land
in Fallbrook, California.
The property is known as Peppertree Park, which has been entitled with an
approved General Plan Amendment, Specific Plan, Tentative Map and a major Use
Permit for the following uses:
(1) Residential (104 single family lots)
(2) Office/Professional (14.88 acres)
(3) Retail Commercial (sold to Vons on October 7, 1993)
(4) On-site amenities (lake, park and hiking trails)
The property which is securing the Loan made by the Partnership is
residential and office/professional land. It is expected that property taxes on
the land will be approximately $30,000 annually. Infrastructure and grading is
proceeding and home construction could begin in mid 1997.
The borrower has completed the engineering for Phase 1 of Unit 1 and Phase
II and is currently seeking construction financing to repay the Partnership
loan. The loan matured on December 28, 1995.
<PAGE> 9
However, the borrower has requested a 90 day extension with additional interest
and mortgage servicing fees. The Partnership received $1,500,000 in cash as a
repayment, and retains a $500,000 interest in the property as an investor from
which the Partnership will receive a participation in profits from the
development of single family homes.
ITEM 2.
PROPERTIES
The Partnership has acquired nine properties through foreclosure since
inception. Additionally, the Partnership is a joint venture in an LLC in a 243
unit apartment complex in Hollywood, California. All of those properties have
been fully disclosed in Item 1, Business of the Partnership.
ITEM 3.
LEGAL PROCEEDINGS
The Partnership has been named as a defendant in two lawsuits by Albert
and Helen LaMonte, Borrowers in Loan #9, referred to above, and by Southpointe
Corporation, their shell corporation utilized to take title to the property and
file bankruptcy proceedings under Chapter 11 of the Bankruptcy Court.
One lawsuit alleges conspiracy and fraud on behalf of the Partnership. The
General Partners believe the suit to be frivolous, and filed solely for the
purpose of delaying the foreclosure sale.
The other lawsuit is attempting to set aside the foreclosure that occurred
in April 1996. The General Partners believe the suit to be frivolous as well.
Both lawsuits are filed in the County of Ventura and are state court cases. This
suit is set to go to trial April 7, 1997.
ITEM 5
MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
As of December 31, 1996, there were approximately 987 record holders of
Units of Limited Partnership interest, representing total subscription of 15,715
units and subscription proceeds in the amount of $15,715,000. As of such date,
all of the subscription proceeds had been committed to the mortgage loan
investments described in Item 7 and working capital reserves. There is no other
class of security outstanding or authorized. There has not been, and currently
there does not exist, any established public trading market for the Units.
Accordingly, to the General Partners' knowledge, there was no trading activity
during the fiscal year ended December 31, 1995. In 1996, 75 Units were traded at
between $315 and $400 per Unit.
CASH DISTRIBUTIONS
Total interest received on mortgage loans from inception to December 31,
1996 was $3,657,666 and other income from deposits and other sources has been
received in the amount of $284,570. Also during 1996 the Peppertree loan was
repaid in the form of $1,500,000 in cash and a 20% interest in a 163.33 acre
project named Village One that is valued at $500,000. Total distributions to
investors from such income and loan repayments were made in 1996 of $682,571.
Total distributions to investors since inception have been $5,781,298.
<PAGE> 10
ITEM 6.
SELECTED FINANCIAL DATA
The following table summarized selected financial data of the Partnership
for the years ended December 31, 1996, 1995, 1994, 1993, and 1992 and should be
read in conjunction with the more detailed financial statements contained in
Item 8, below.
<TABLE>
<CAPTION>
1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C>
INTEREST INCOME $152,734 $804,573 $1,253,631 $1,272,295 $281,050
OTHER INCOME 154,163 15,262 4,528 0 4,000
TOTAL INCOME $306,897 $819,835 $1,258,159 $1,272,295 $285,050
NET INCOME $304,926 $694,035 $748,442 $1,214,371 $266,391
NET INCOME PER UNIT $19 $44 $47 $83 $32
DISTRIBUTION PER UNIT $43 $160 $77 $86 $22
TOTAL ASSETS $15,868,401 $14,385,542 $15,606,951 $14,614,432 $8,397,315
</TABLE>
Based on 15,715, 15,715, 15,715, 14,461 and 8,334 Units outstanding at December
31, 1996, 1995, 1994, 1993, 1992 respectively
ITEM 7.
MANAGEMENT'S DISCUSSION AND ANALYSES OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
During the period from inception (November 15, 1991) through April 22,
1994, the Partnership was engaged in the formation of the Partnership, the sale
of Units of Limited partnership Interest and the investment of the subscription
proceeds in mortgage loan investments. On April 22, 1994, the offering and sale
of limited Partnership units ceased. As of April 22, 1994, a total of 15,715
Units had been sold by the Partnership for total proceeds of $15,715,000. Excess
proceeds from the sale of units were invested in interest-bearing reserve
accounts. During 1995, the revenues received were interest income earned on
mortgage loans and interest income earned on funds held in reserve. During 1996,
the Partnership received approximately $146,000 of revenues from the investment
in a 243 unit apartment complex in addition to the above revenue sums.
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. As of December 31,
1996, twelve loans had been made by the Partnership. Three loans had been repaid
and seven loans had defaulted and the Partnership had repossessed the property.
See "Item 1 - Business" subcaption "Mortgage Loan Investments."
As of December 31, 1996, the Partnership had cash on hand of $131,404. All
other proceed from the offering had been invested in Loans or working capital
reserves, or had been used in foreclosure proceeds or maintaining the foreclosed
properties for the Partnership. Also as of December 31, 1996, the Partnership
had invested $854,474 in a 243-unit apartment complex in the Los Angeles area as
well as investments in five single family developments in the Southern
California area.
<PAGE> 11
LIQUIDITY AND CAPITAL RESOURCES
From inception to December 31, 1996, the Partnership received a total of
$15,715,000 in gross proceeds from the sale of limited partnership units. During
the period from inception through December 31, 1996, the Partnership made a
total of twelve mortgage loans for a total expenditure of $15,615,000. Three
loans, in the total amount of $4,825,000 was repaid during the fiscal year
ending December 31, 1995.
The Partnership raised a total of $8,334,000, $6,127,000, and $1,254,000
during the calender years ended December 31, 1992, 1993, and 1994, respectively.
The offering was closed on April 22, 1994 and no additional subscriptions were
accepted after that date.
The Partnership made loans of $4,870,000, $7,420,000, and $2,725,000
during the calender years ended December 31, 1992, 1993, and 1994, respectively.
Of the twelve loans made, nine loans totaling $10,190,000 were foreclosed upon
and three loans totaling $4,825,000 were repaid. Proceeds from loan repayments
were either reinvested, added to Partnership reserves, or distributed to
investors.
The Partnership does not intend to make any new land loans with existing
or future Partnership cash. At December 31, 1996, the Partnership had an
investment in a 243 unit apartment complex in the Los Angeles area as well as
development agreements with TMP Homes, an affiliated company, to develop single
family homes on three of the properties the Partnership has acquired through
foreclosure. In addition, the Partnership had a $500,000 investment in a single
family development that resulted from the Peppertree loan. The Partnership was
repaid $1,500,000 of the $2,000,000 loan in cash with the remaining $500,000 as
an investment in the project. The Partnership may incur indebtedness from
nonaffiliated financial institutions in order to complete any development for
projects in which the Partnership is involved.
The nine loans that were foreclosed upon and are owned by the Partnership
produce no income stream. Accordingly, the Partnership is not making
distributions to investors except from the sale proceeds of Partnership assets.
Partnership cash reserves are being used to fund the operating cash needs of the
Partnership. As of December 31, 1996, the Partnership did not have sufficient
cash reserves for the next twelve months. However, in March 1997, the
Partnership's investment in the apartment complex was repaid along with a profit
of approximately $656,000. The Partnership intends to distribute $1,000,000 to
investors and retain the balance as cash reserves to fund future operating cash
needs. In the event the Partnership needs additional cash for operations, it may
also subject Partnership properties it has acquired through foreclosure to
mortgage indebtedness.
The two PR Equities properties that were foreclosed upon have substantial
Mello-Roos taxes that the Partnership does not have the cash to pay, nor is it
in the best interest of the Partnership to pay. The General Partners are
attempting to have the Mello-Roos bonds restructured (See Mortgage Loan
Investments section), however, there is no assurance that this can be
accomplished.
Aside from the foregoing, the Partnership knows of no demands,
commitments, events, or uncertainties which might affect its liquidity or
capital resources in any material way.
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following financial statements are filed as part of the Form 10K:
Page No
-------
(I) For the fiscal years ended December 31, 1996, 1995, and 1994
Independent Auditors' Report FS-1
<PAGE> 12
Balance Sheets of December 31, 1996 and 1995 FS-2
Statements of Income for the years ended
December 31, 1996,1995 and 1994 FS-3
Statements of Partners' Capital for the years ended
December 31, 1996, 1995, 1994 and 1993 FS-4
Statements of Cash Flow for the years ended
December 31, 1996, 1995, 1994 FS-5
Notes to Financial Statements FS-6
Financial Statements Schedules FS-12
All other schedules are omitted since the required information is not present or
is not present in amounts sufficient to require submission of the schedule, or
because the information required is included in the Financial Statements and
Notes thereto.
PART III
ITEM 10.
DIRECTORS AND EXECUTIVE OFFICERS
The Partnership has no employees and no directors or executive officers.
Management of the Partnership is provided by the General Partners.
TMP Properties, a California general partnership, and TMP Investments,
Inc., a California corporation, are the General Partners of the Partnership. TMP
Properties was formed on July 14, 1978. TMP Properties' principal business has
been the acquisition of undeveloped land and the coordination of activities
necessary to add value to such land, primarily through the predevelopment
process. It has syndicated numerous private real estate limited partnerships,
and eight public real estate limited partnerships. All of the properties
purchased by such partnerships were located in the State of California except
for one (an office building) which was located in Oklahoma City, Oklahoma. Each
of such limited partnerships involved a specified real property program in which
TMP Properties was the general partner. In addition, TMP Properties has been and
will continue to be engaged in property management, assets management, real
estate accounting, budgetary services and partnership management on behalf of
existing
<PAGE> 13
limited partnership and limited partnerships which it sponsors in the future.
The general partners of TMP Properties are William O. Passo, Anthony W. Thompson
and Scott E. McDaniel.
TMP Investments, Inc., a California corporation, was formed on December
12, 1984. TMP Investments, Inc. acts as loan servicer for the Partnership,
maintaining records with respect to, and billing and collecting payments on, the
loans made by the Partnership. As compensation for such services, TMP has
received a monthly loan servicing fee from each borrower, and not the
Partnership, in an amount up to 1/8th of 1% of the outstanding principal amount
of the borrower's loan. See "Compensation to the General Partners and their
Affiliates." TMP Investments also performs administrative, bookkeeping and
clerical services for the Partnership. The principals of TMP Investments, Inc.
are William O. Passo and Anthony W. Thompson.
The individual partners of TMP Properties are listed below, together with
information regarding their employment experience and background.
WILLIAM O. PASSO, 55, is a director and the President of TMP
Investments, Inc. He practiced law for 18 years, has been a licensed real estate
broker since 1974 and holds registered representative and general principals
securities licenses through the National Association of Securities Dealers, Inc.
Mr. Passo received his Juris Doctorate Degree from UCLA School of Law in 1967.
He has been a senior partner first of Passo, Yates and Nissen until 1975, then
of Passo & Davis until March 1983 when he resigned from the partnership to take
a leading role in the management of the affairs of TMP Properties. Mr. Passo has
been involved in public and private real-estate syndication since 1970, and has
acted as principal, investor, general partner, and counsel in real estate
transactions involving apartments, office buildings, agricultural groves and
unimproved land. Mr. Passo is a director and officer of William O. Passo, Inc.
d.b.a. TMP Management, a property management company, and an officer of TMP
Capital Corp., an NASD registered broker-dealer.
SCOTT E. MCDANIEL, 50, is a general partner of TMP Properties.
He is a graduate of the US Naval Academy at Annapolis, majoring in
engineering. Mr. McDaniel is a California licensed general contractor and
has been a licensed California real estate broker since 1976. He was the
founder and president of Scott E. McDaniel, Inc. (dba Regal Realty). Mr.
McDaniel has developed office complexes and industrial space in Southern
California and has personally brokered over $125 million of real estate since
1982. Through an affiliated company, DeVille Construction Co., Inc., Mr.
McDaniel has directed general contracting operations in Southern California
since 1982.
ANTHONY W. "TONY" THOMPSON, 50, is Director and Vice President of
TMP Investments, Inc. A graduate of Sterling College in 1969, with a Bachelors
Degree in Science and Economics, Mr. Thompson holds the professional designation
of Charter Life underwriter and chartered Financial Consultant from the American
College. Mr. Thompson is a registered principal with the NASD and is a principal
in TMP Capital Corp., a NASD registered Broker Dealer. Mr. Thompson has been
involved in the securities and the real estate investment fields since 1970, and
a General Partner of TMP since its formation in 1978. Mr. Thompson's primary
responsibility is marketing TMP offerings through the broker-dealer community.
In addition to being a General Partner of the Partnership, TMP
Properties, and some of its affiliates, has been and continues to be a general
partner of other limited partnerships. If any such other limited partnerships'
assets should become insufficient to meet Partnership obligations, TMP
Properties, as a general partner of such other limited partnerships, might be
subject to liabilities on behalf of such partnerships.
<PAGE> 14
ITEM 11.
EXECUTIVE COMPENSATION
During the period since the formation of the Partnership (November 15,
1991) through the fiscal year ended December 31, 1996, the Partnership paid no
fees to the General Partners. The General Partners did receive collectively
$6,826 during the fiscal year ended December 31, 1996 as their share of
Partnership distributions. (See Item 13. "Certain Relationships and Related
Transactions".) The Partnership has no officers or employees and, therefore,
paid no other compensation other than that paid to the General Partners as
indicated above.
ITEM 12.
SECURITY OWNERSHIP OR CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of December 31, 1996 the Partnership has 15,715 units of Limited
Partnership interest (the "Units") issued and outstanding. To the knowledge of
the General Partners, no person beneficially owns more than 5% of the Units. The
following table sets forth the number of Units beneficially owned as of December
31, 1996 by each officer, director and general partner of the General Partners
and by all such persons as a group.
<TABLE>
<CAPTION>
Number of Percent of
Name of Beneficial Owner Units Class
- ------------------------ ----- -----
<S> <C> <C>
William O. Passo 1 .012%
All officers, directors and general
partners as a group (1 person
including the above) 1 .012%
</TABLE>
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
TRANSACTIONS WITH AFFILIATES
TMP Capital Corp., a California corporation which is an affiliate of
the General Partners, is the Managing Broker-Dealer for the offer and sale of
the Units. TMP Capital Corp. is a member firm of the National Association of
Securities Dealers, Inc. The Managing Broker-Dealer was established to
provide underwriting, wholesaling, and other securities related services to
partnerships sponsored by the General Partners. The directors and executive
officers of TMP Capital Corp. are: Anthony W. Thompson, President and
Director, and William O. Passo, secretary, vice-president, and director.
(See Item 10 "Directors and Executive Officers" for information regarding
Messrs. Thompson and Passo).
The following information summarizes the forms and estimated amounts of
compensation (some of which involve cost reimbursements) to be paid either by
the Partnership, or others, to the General Partners and their Affiliates. None
of these fees were determined by arm's length negotiations. Except as disclosed
below, neither the General Partner nor any of their affiliates, directors,
officers, employees, agents, or counselors are participating, directly or
indirectly, in any other compensation or remuneration with respect to the
offering.
<PAGE> 15
OFFERING AND ORGANIZATIONAL STAGE
<TABLE>
<CAPTION>
Estimated Dollar
Form of Compensation Amount of
and Recipient Description of Payment Compensation
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
Selling Commissions (TMP At no expense to the Partnership, $100,000 - $105,000 if
Capital Corp. and Soliciting up to a maximum of 10% Gross the minimum number of
Dealers) Proceeds, a minimum of 8% of which Units are sold;
will be reallocated to participating $2,000,000 to $2,100,000
Soliciting Dealers (which may include if the maximum number
TMP Capital Corp.) on Units sold by of Units are sold.
them. Up to an additional 0.5% may
be paid to Soliciting Dealers
(which may include TMP Capital
Corp.) for due diligence
activities. All such amounts will
be payable by TMP Realty, Inc.
("TMP Realty"), a licensed real
estate broker and an Affiliate of
the General Partners. It is
anticipated that most of the Units
will be sold through Soliciting
Dealers; the actual amount of
selling commissions payable to TMP
Capital Corp. will depend on the
number of Units sold by it.
Reimbursement of At no expense to the Partnership, Not determinable
</TABLE>
<PAGE> 16
<TABLE>
<S> <C> <C>
Organizational Expenses Organizational Expenses such as at this time.
(General Partners) advertising, mailing, printing costs,
clerical expenses, legal and
accounting fees will be paid by
TMP Realty, an Affiliate of the
General Partners.
Reimbursement of Loan The General Partners will be Not determinable
Expenses (General Partners) reimbursed for all out of pocket at this time.
expenses, if any, directly related
to the loans which may be made by
the Partnership, including actual
interest incurred on all funds
advanced for the benefit of the
Partnership, and the following
expenses which typically will be
paid by the Borrower; escrow
expenses, title fees, extension
payments, appraisal fees, expenses
of feasibility and other studies
performed by third parties
unaffiliated with the General
Partners and similar expenses but
not to include the General
Partners' overhead, salaries,
travel or like expenses.
</TABLE>
OPERATING AND LIQUIDATION STAGE
<TABLE>
<CAPTION>
ESTIMATED DOLLAR
FORM OF COMPENSATION AMOUNT OF
AND RECIPIENT DESCRIPTION OF PAYMENT COMPENSATION
- -----------------------------------------------------------------------------------------
<S> <C> <C>
Loan Servicing Fee For servicing the loans made by the About $14,700 per year if
(General Partners) Partnership, the General Partners the minimum of 1,000
will receive a monthly Loan Servicing Units are sold, or
Fee that will be charged to and be $294,000 per year if all
paid by each borrower in an amount up 20,000 Units are sold.
to 1/8 of 1% of the outstanding
principal amount of this mortgage loan.
Broker Loan Placement TMP Realty, a licensed real estate broker If all 20,000 Units were
Fee (Licensed Real and an Affiliate of the General Partners, sold, then on the Initial
Estate Broker Affiliated had contracted with the Partnership to Funding of the Loans and
with General Partners) use its best efforts to obtain qualified after paying Selling
borrowers and to assist in negotiating Commissions and
loan terms. TMP Realty will be Organizational Expenses,
entitled to charge the borrowers a loan TMP would retain up to
origination or extension fee (Broker $1,903,000 of Points; and
Loan Placement Fee) for such services. on the next $11,200,000
TMP Realty may retain the amount of loans made (from re-
by which the Broker Loan Placement payments of Initial
Fees received on all loans until the Loans), TMP Realty
aggregate amount of loans made by would retain $1,008,000
</TABLE>
<PAGE> 17
<TABLE>
<S> <C> <C>
the Partnership equals the Gross of the Points. On any
Proceeds of this offering (the "Initial loans made thereafter,
Loans" or the "Initial Funding of the Partnership would
Loans") exceeds the sum of Selling receive 50% of the Points
Commissions and the Organizational and TMP Realty would
Expenses. On all loans made there- receive 50% subject to
after, TMP Realty may retain 50% of subordination to the
any Broker Placement Fee, 25% will Limited Partners'
be remitted to the Partnership, until Priority Return.
TMP Realty has satisfied it obligation
to pay, out of the Borrower Loan
Placement Fees, Selling Commissions and
the due diligence fees. On all loans
made thereafter, TMP Realty may retain
50% of any Broker Loan Placement Fees,
and the remaining 50% will be remitted
to the Partnership; provided, however,
that TMP Realty's right to retain it
50% portion shall be subordinated to a
cumulative noncompounded return of 8%
per annum to the Limited Partners on
their Adjusted Capital Contributions.
Interest in Partnership 1% interest in all Partnership allocation Not determinable at this
Allocation of each Net Income, net loss, and Distributions time.
Material Item (General of Distributable Cash from Operations.
Partners)
Subordinated
Participation A 24% interest in allocation of Net Not determinable
(General Partners) Income and Distributions of Cash at this time.
from Loan Repayments or from the Sale
or Refinancing of a property acquired
through foreclosure or otherwise, all
subordinated to a return of all the
Limited Partners of 8% per annum on
their Adjusted Capital Contributions.
Subordinated Real Estate Real Estate commissions with respect Not determinable at this
Commission (General to the sale of any properties acquired time.
Partners or an Affiliate) through foreclosure or otherwise,
which are equal to the lessor of: (1)
3% of the gross sales price of a
property equal to one-half the normal
and competitive rate charged by
unaffiliated parties, but such payment
shall be subordinated to a return of
all of the Limited partners' Capital
Contributions, plus a non-compounded
return to the Limited Partners of 8%
per annum on their Adjusted Capital
Contributions.
</TABLE>
(1) The amount of the Broker Loan Fees to be received by TMP Realty will depend
on (i) the dollar amount of Units sold in this offering; (ii) the duration or
term of the loans made by the Partnership; and
<PAGE> 18
(iii) market conditions which will affect the points that can be charged. Based
on the assumptions that $20,000,000 of Units are sold, the duration of all of
the loans is 36 months, and the points charged are equal to 1/2% of the loan
amount per month, on the Initial Funding of Loans TMP Realty would receive
points of $3,528,000. However, TMP Realty will pay $1,500,000 of that amount as
Selling Commissions and due diligence fees, and approximately $125,000 for
Organization and Offering Expenses, which would result in compensation to TMP
Realty of $1,903,000 or about 9.5% of the Gross Proceeds of the Offering. On the
next $11,200,000 of loans made, after payment of the remaining Selling
Commissions, TMP Realty would retain Broker Loan Fees of $1,008,000, assuming
all such Loans are made for 36 month terms. However, based on their experience,
the General Partners believe that most loans will be made for 12-to-24 month
terms and, therefore, on the Initial Funding of Loans, the points that would be
paid and TMP Realty's compensation would be substantially lower (see note (2)
below). If only $1,000,000 of Units are sold, assuming loans are made for 36
month terms and points of 1/2% per month are paid, TMP Realty would receive
points aggregating $176,400 on the Initial Funding of Loans, but would be
obligated to pay Selling Commissions and Organization and Offering Expenses
aggregating approximately $200,000.
(2) Based on the experience and knowledge of the market conditions, the
General Partners do not believe it to be a realistic assumption that all loans
will be of 36 months' duration. Land loans most often are made for periods
ranging from 12-to-24 months and the General Partners believe that the term of
the loans will average about 18 months. If the Partnership were funded at
$20,000,000 in Gross Proceeds, and assuming the term of the loans made averages
18 months, resulting in the payment by borrowers of an average of 9 points, the
Partnership would not participate in the points paid on the first $19,600,000 of
loans made. Such points would total $1,764,000, would be used by TMP Realty to
pay Selling Commissions, due diligence fees and Organization and other Offering
Expenses. The Partnership would receive 25%, or approximately $600,000, of the
points (or a total of approximately $2,400,000) on approximately the next
$26,667,000 of loans made (with repaid principal or by loan extensions); and
would receive at least 50% of points on all loans made thereafter.
(3) Points, like interest, represent a cost to the borrower for a loan. As a
result, it may be possible to obtain more points from borrowers by decreasing
the rate of interest charged on a loan. An increase in points in exchange for a
reduction in interest rates would increase the compensation that would be
received by TMP Realty. For this reason, the General Partners have placed a
ceiling on the points that may be charged on loans at 1/2% per month, which is
comparable to the points charged by other mortgage lenders on similar loans
being made in Southern California. In addition, borrowers ordinarily will resist
increases in points because points must be paid in advance; however, for tax
purposes, points may not be deducted when paid. Finally, to compete with other
mortgage lenders the Partnership will have to keep its mortgage terms, including
points, in line with those offered by other mortgage lenders.
(4) A Limited Partner's Adjusted Capital Contribution is the amount the
Limited Partner paid for his or her Units, reduced by any cash distributions the
source of which is other than interest or fees on loans made by the Partnership.
See Item 1, "BUSINESS", subcaption "Distributions, Net Income and Net Loss".
ITEM 14.
EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8K
(a) For a listing of financial statements, reference is made to Item
8 included in this form 10K.
(b) Exhibits:
3 & 4 Amended and Restated Agreement of Limited Partnership
incorporated by reference to Exhibit 4.1 filed in Form S-11, SEC File No.
33-39238 on April 13, 1992.
10 Material contracts are incorporated by reference as
follows:
<PAGE> 19
Incorporated by reference to Amendment No. 1 as filed with
the SEC on September 14, 1992.
10.1.1 Loan Agreement - PR Equities Loan (Loan #1)
10.1.2 Promissory Note - PR Equities Loan (Loan #1)
10.1.3 Deed of Trust - PR Equities Loan (Loan #1)
10.2.1 Loan Commitment - PR Equities Loan (Loan #2)
10.3.1 Loan Agreement - Frame Loan (Loan #3)
10.3.2 Promissory Note - Frame Loan (Loan #3)
10.3.3 Deed of Trust - Frame Loan (Loan #3)
10.4.1 Loan Agreement - Sunset Crossing Loan (Loan #4)
10.4.2 Promissory Note - Sunset Crossing Loan (Loan #4)
10.4.3 Deed of Trust - Sunset Crossing Loan (Loan #4)
10.4.4 Personal Guaranty - Sunset Crossing Loan (Loan #4)
10.4.5 Promissory Note - Bank Loan for Bridge
Financing - Sunset Crossing Loan (Loan #4)
Incorporated by reference to Amendment No. 3 as filed with
the SEC on February 24, 1993.
10.7.1 Loan Agreement - PR Equities Loan (Loan #2)
10.7.2 Promissory Note - PR Equities Loan (Loan #2)
10.7.3 Deed of Trust - PR Equities Loan (Loan #2)
10.10.1 Loan Agreement - Fox-Olson Loan (Loan #5)
10.10.2 Promissory Note- Fox-Olson Loan (Loan #5)
10.10.3 Deed of Trust - Fox-Olson Loan (Loan #5)
10.11.1 Loan Agreement - Environmental
Development, Ltd. (Loan #6)
10.11.2 Promissory Note - Environmental Development,
Ltd. (Loan #6)
10.11.3 Deed of Trust - Environmental Development
Ltd. (Loan #6)
Incorporated by reference to Amendment No. 6 as filed with the
SEC on September 14, 1993:
10.8.4 Modification of Promissory Note - Frame
Loan (Loan #3)
10.12.1 Loan Agreement - Fox-Olson Loan 2 (Loan #7)
10.12.2 Promissory Note - Fox-Olson Loan 2 (Loan #7)
10.12.3 Deed of Trust - Fox-Olson Loan 2 (Loan #7)
Incorporated herein by reference to Exhibits A through H filed
with the Registrant's Current Report on Form 8-K, dated October 12, 1993, SEC
File No. 0-19933:
10.13.1 Loan Agreement - Singletary Loan (Loan #8)
10.13.2 Promissory Note - Singletary Loan (Loan #8)
10.13.3 Deed of Trust - Singletary Loan (Loan #8)
10.14.1 Loan Agreement - LaMonte Loan (Loan #9)
10.14.2 Promissory Note - LaMonte Loan (Loan #9)
<PAGE> 20
10.14.3 Deed of Trust - LaMonte Loan (Loan #9)
10.14.4 Subordination, Non-disturbance and
Attornment Agreement - LaMonte Loan
(Loan #9)
10.14.5 Consent to and Subordination of Deed of
Trust - LaMonte Loan (Loan #9)
<PAGE> 21
TMP LAND MORTGAGE FUND, LTD.
(A CALIFORNIA LIMITED PARTNERSHIP)
FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
<PAGE> 22
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Financial Statements
December 31, 1996 and 1995
Table of Contents
<TABLE>
<CAPTION>
<S> <C>
Independent Auditor's Report............................................ 1
Balance Sheets.......................................................... 2
Statements of Income.................................................... 3
Statements of Partners' Capital......................................... 4
Statements of Cash Flows................................................ 5
Notes to Financial Statements........................................... 6-11
Supplementary Information............................................... 12-17
</TABLE>
<PAGE> 23
BALSER, HOROWITZ, FRANK & WAKELING LETTERHEAD
AN ACCOUNTANCY CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
Independent Auditor's Report
To the Partners
TMP Land Mortgage Fund, Ltd.
A California Limited Partnership
We have audited the accompanying balance sheets of TMP Land Mortgage Fund, Ltd.
(A California Limited Partnership) as of December 31, 1996 and 1995, and the
related statements of income, partners' capital and cash flows for the years
ended December 31, 1996, 1995 and 1994. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of TMP Land Mortgage Fund, Ltd. (A
California Limited Partnership) as of December 31, 1996 and 1995, and the
results of its operations and cash flows for the years ended December 31, 1996,
1995 and 1994 in conformity with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplementary information contained
in Schedules I and II is presented for purposes of additional analysis and is
not a required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, is stated fairly in all material respects in
relation to the basic financial statements taken as a whole.
/s/ BALSER, HOROWITZ, FRANK & WAKELING LETTERHEAD
BALSER, HOROWITZ, FRANK & WAKELING
An Accountancy Corporation
Santa Ana, California
February 3, 1997
3000 WEST MACARTHUR BLVD., SUITE 600, SANTA ANA, CALIFORNIA 92704
TELEPHONE (714) 754-1040 - (562) 425-8585 * FAX (714) 754-0362
BRANCH OFFICE: LONG BEACH
MEMBERS: AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS AND CALIFORNIA
SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
<PAGE> 24
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Balance Sheets
December 31, 1996 and 1995
Assets
------
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Cash $ 131,405 $ 81,957
Other receivable 200 24,285
Mortgage loans on real estate (Schedule I) 0 3,320,000
Investments 2,797,666 1,325,770
Properties held for sale (Schedule II) 12,939,130 9,633,530
----------- -----------
Total assets $15,868,401 $14,385,542
=========== ===========
Liabilities and Partners' Capital
---------------------------------
Accounts payable $ 0 $ 17,475
Due to affiliates 23,885 66,277
Accrued expenses 2,682,642 762,271
----------- -----------
Total liabilities 2,706,527 846,023
----------- -----------
Partners' capital (deficit)
General partners (25,585) (21,808)
Limited partners, 20,000 equity units
authorized, 15,715 units outstanding
at December 31, 1996 and 1995 13,187,459 13,561,327
----------- -----------
Total partners' capital 13,161,874 13,539,519
----------- -----------
Total liabilities and partners' capital $15,868,401 $14,385,542
=========== ============
</TABLE>
See Accompanying Notes and Independent Auditor's Report
-2-
<PAGE> 25
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Statements of Income
For the Years Ended December 31, 1996, 1995 and 1994
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Revenue:
Mortgage loan interest income $152,734 $697,431 $1,216,528
Bank deposit interest income 3,552 19,142 37,103
Investment income 146,011 11,662 -0
Other income 4,600 3,600 4,528
-------- -------- ----------
Total revenue 306,897 731,835 1,258,159
-------- -------- ----------
Expenses:
Accounting and legal 1,020 18,352 24,059
Advertising 0 642 -0
California Franchise Tax 800 800 800
Foreclosure costs 0 0 40,061
Loan administration 151 0 35
Office expenses 0 3,044 3,210
Postage and printing 0 5,502 6,677
Property taxes 0 0 423,224
Secretarial and bookkeeping support 0 9,460 11,651
-------- -------- ----------
Total expenses 1,971 37,800 509,717
-------- -------- ----------
Net income $304,926 $694,035 $ 748,442
======== ======== ==========
Allocation of net income:
General partners, in the aggregate $ 3,049 $ 6,940 $ 7,484
======== ======== ==========
Limited partners, in the aggregate $301,877 $687,095 $ 740,958
======== ======== ==========
Limited partners, per equity unit $ 19 $ 44 $ 47
======== ======== ==========
</TABLE>
See Accompanying Notes and Independent Auditor's Report
-3-
<PAGE> 26
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Statements of Partners' Capital
For the Years Ended December 31, 1996, 1995 and 1994
<TABLE>
<CAPTION>
General Limited
Partners Partners Total
-------- -------- -----
<S> <C> <C> <C>
Partners' capital, December 31, 1993 $ 1,408 $ 14,605,314 $ 14,606,722
Capital contributed in 1994 0 1,254,000 1,254,000
Net income for 1994 7,484 740,958 748,442
Distributions to partners in 1994 (12,244) (1,211,972) (1,224,216)
-------- ------------ ------------
Partners' capital (deficit),
December 31, 1994 (3,352) 15,388,300 15,384,948
Net income for 1995 6,940 687,095 694,035
Distributions to partners in 1995 (25,396) (2,514,068) (2,539,464)
-------- ------------ ------------
Partner's capital (deficit),
December 31, 1995 (21,808) 13,561,327 13,539,519
Net income for 1996 3,049 301,877 304,926
Distributions to partners in 1996 (6,826) (675,745) (682,571)
-------- ------------ ------------
Partner's capital (deficit),
December 31, 1996 $(25,585) $ 13,187,459 $ 13,161,874
======== ============ ============
</TABLE>
Distributions to Limited Partners, per equity unit, for 1996, 1995 and 1994 were
$43, $160 and $77, respectively, as determined by dividing the distributions to
partners for the year by the number of units outstanding at the end of the year.
See Accompanying Notes and Independent Auditor's Report
-4-
<PAGE> 27
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Statements of Cash Flows
For the Years Ended December 31, 1996, 1995 and 1994
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Cash flow from operating activities:
Net income $ 304,926 $ 694,035 $ 748,442
Adjustments to reconcile net income to net
cash provided by operating activities:
Decrease in accrued interest receivable 0 91,902 42,415
(Increase) or decrease in other receivable 24,085 (24,285) 0
Increase or (decrease) in accounts payable (17,475) 1,298 12,612
Increase in accrued expenses 1,920,371 557,314 204,157
Increase or (decrease) in due to affiliates (42,392) 65,408 (2,476)
----------- ----------- -----------
Net cash provided by operating activities 2,189,515 1,385,672 1,005,150
----------- ----------- -----------
Cash flow provided by or (used in) investing activities:
Funding of loans receivable 0 0 (2,725,000)
Proceeds from maturity of loans receivable 1,500,000 4,950,000 600,000
Acquisition of properties (2,085,600) (2,832,068) 0
Increase in investments (871,896) (1,325,770) 0
Payment for development and carrying costs 0 0 (56,462)
----------- ----------- -----------
Net cash (used in) investing activities (1,457,496) 792,162 (2,181,462)
----------- ----------- -----------
Cash flow provided by or (used in) financing activities:
Capital contributions 0 0 1,254,000
Distributions to partners (682,571) (2,539,464) (1,224,216)
----------- ----------- -----------
Net cash provided by or (used in) financing
activities (682,571) (2,539,464) 29,784
----------- ----------- -----------
Net increase or (decrease) in cash 49,448 (361,630) (1,146,528)
Cash, beginning of year 81,957 443,587 1,590,115
----------- ----------- -----------
Cash, end of year $ 131,405 $ 81,957 $ 443,587
=========== =========== ===========
Supplemental disclosures of cash flow information:
Income taxes paid $ 800 $ 800 $ 800
</TABLE>
Other disclosures:
Non-cash investing and financing activities during the year ended December 31,
1996 and 1995 consisted of acquiring land parcels through foreclosure
proceedings on loans receivable. Total outstanding loan balances of $1,320,000,
$2,125,000 and $6,745,000 for 1996, 1995 and 1994, respectively, were
transferred to properties held for sale.
See Accompanying Notes and Independent Auditor's Report
-5-
<PAGE> 28
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1996 and 1995
Note 1 - Organization and summary of significant accounting policies
Organization - TMP Land Mortgage Fund, Ltd., A California Limited
Partnership (the "Partnership"), was formed on November 15, 1991 by TMP
Properties and TMP Investments, Inc. (collectively referred to as the
"General Partners"). The purpose of the Partnership is to raise capital
and make short-term (generally one to three-year) loans to unaffiliated
persons or entities secured by first trust deeds (mortgages) on
unimproved real property primarily in the Inland Empire area of Southern
California, and to provide cash distributions on a current basis to the
partners, primarily from interest earned on the mortgage loans. No
mortgage loans will be made with maturities beyond July 31, 1997; and the
general partners intend to cease making loans by January 31, 1997 and to
liquidate the Partnership's assets and dissolve the Partnership as soon
as practicable thereafter. In accordance with certain provisions of the
Partnership Agreement (the "Agreement"), the Partnership may be dissolved
earlier than 1997.
The General Partners manage and control the affairs of the Partnership,
including having final approval of all loans and investments, and have
ultimate authority for matters affecting the interest of the Partnership.
All organization and offering expenses of the Partnership were paid by an
affiliate of the General Partners.
Accounting Method - The Partnership's policy is to prepare its financial
statements on the accrual basis of accounting.
Partners' Equity - The Partnership raised capital through a public
offering of units at $1,000 per unit. The minimum offering size was 1,000
units or $1,000,000. The maximum offering size was 20,000 units or
$20,000,000. As of December 31, 1994, 15,715 units were sold for total
capital contributions of $15,715,000. No contributions were accepted
after April 21, 1994.
The partnership agreement provides for two types of investments:
Individual Retirement Accounts (IRA) and others. The IRA minimum purchase
requirement is $2,000 and all others are a minimum purchase requirement
of $5,000. The maximum liability of the limited partners is the amount of
their capital contribution.
Allocation of net income and net losses from operations - Net income from
operations shall generally be allocated 99% to all limited partnership
units, which will be further allocated among such units on a pro rata
basis, and 1% to the general partners. Net losses shall be allocated to
the partners with positive capital accounts, in accordance with the ratio
of their positive capital account balances, until no partner has a
positive capital account; and thereafter, net losses will be allocated
100% to the general partners.
See Independent Auditor's Report
-6-
<PAGE> 29
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1996 and 1995
Note 1 - Organization and summary of significant accounting policies (Continued)
Allocation of profits and losses on sales of property - Profits and
losses on sales of property (which would ordinarily be acquired, if at
all, on foreclosure of a defaulted loan) will be allocated first to the
limited partners, until they have received a cumulative, non-compounded
8% per annum return on their adjusted capital contributions and then 76%
to the limited partners and 24% to the general partners. In the case of
any losses that might be incurred on the sale of foreclosed property,
such losses will be allocated first to any of the partners, whether
general or limited, with positive balances in their capital accounts,
until such time as no general or limited partner has a positive balance
in his or her capital account. Thereafter, all losses on sales of
foreclosed property will be allocated to the general partners.
Distributions of cash from operations - Distributions of cash from
operations, if any, will be made monthly within 30 days after the end of
each calendar month, and shall be allocated 99% to the limited partners
and 1% to the general partners. Distributions made during 1996, 1995 and
1994 are shown on the accompanying statements of partners' capital.
Cash from loan repayments and from sales or refinancing of property -
Cash from loan repayments and from any sale or financing of a foreclosed
property that is not reinvested in new mortgage loans or retained for
operations of the Partnership will be distributed 99% to the limited
partners and 1% to the general partners until the limited partners have
received cumulative cash distributions in an aggregate amount equal to
their capital contributions plus their priority return. Thereafter cash
from loan repayments and from sales or refinancing will be distributed
24% to the general partners and 76% to the limited partners. A limited
partner's priority return will be equal to a cumulative, but not
compounded, return of 8% per annum on his or her adjusted capital
contribution. A limited partner's adjusted capital contribution is the
amount which the limited partner paid for his or her units, reduced by
the amount of cash distributed to him or her other than cash from
operations and cash from loan repayments or sales or financing that must
be applied to satisfy the limited partners' priority return.
Properties Held for Sale - Properties held for sale consist of unimproved
land and are stated at the balances of the foreclosed loans plus carrying
costs incurred since foreclosure. All costs associated with the
acquisition of a property are capitalized. Additionally, the Partnership
capitalizes all carrying costs which includes interest expense and
property taxes. Such costs are added to the cost of the properties and
are deducted from the sales prices to determine gains when properties are
sold.
Income Taxes - No provision for federal income taxes has been made in
these financial statements as all profit and losses will flow through to
the respective partners and are recognized on their income tax returns.
However, the minimum California Franchise tax due by the Partnership at
December 31, 1996, 1995 and 1994 was $800 per year.
See Independent Auditor's Report
-7-
<PAGE> 30
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1996 and 1995
Note 1 - Organization and summary of significant accounting policies (Continued)
Allowance for Losses on Loans - In view of the relationship of the loan
amounts to market values of the properties mortgaged, there is no
provision for an allowance for losses on loans. Factors that could be
considered in establishing the timing and amount of an allowance for
losses would include the market value of the collateral compared to the
loan balance, the borrower's ability to repay the loan and prospects for
selling the collateral.
Cash and Cash Equivalents - For the purpose of the statements of cash
flows, the Partnership considers all highly liquid investments with a
maturity of three months or less when purchased to be cash equivalents.
During the normal course of its business, the Partnership accumulates
cash and maintains deposits at various banks. Occasionally, the cash
deposit at a particular bank may exceed the federally insured limit. Any
accounting loss or cash requirement resulting from the failure of a bank
would be limited to such excess amounts. Cash deposits in excess of the
federally insured limits totaled $42,797 and $341,599 at December 31,
1996 and 1995, respectively.
Estimates - In preparing financial statements in conformity with
generally accepted accounting principles, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at
the date of the financial statements and revenues and expenses during the
reporting period. Actual results could differ from these estimates.
Concentration - All unimproved land parcels held for sale are located in
Southern California. The eventual sales price of all parcels is highly
dependent on the real estate market condition. The Partnership attempts
to mitigate any potential risk by monitoring the market condition and
holding the land parcels until the real estate market recovers.
Note 2 - Related Party Transactions
Unaffiliated borrowers paid broker loan placement fees to TMP Realty,
Inc., an affiliate of the General Partners, of $40,000, $88,000 and
$258,750 during 1996, 1995 and 1994, respectively, for assistance in
negotiating loan terms with the Partnership. TMP Realty, Inc. pays all
organization and offering expenses, including all legal, accounting,
printing, registration and other costs. In addition, the borrowers paid
loan servicing fees to TMP Investments, Inc., a general partner of the
Partnership, of $10,000, $33,000 and $69,375 during 1996, 1995 and 1994,
respectively. At December 31, 1995, the partnership owed TMP Investments,
Inc. $22,000 for loan servicing fees.
See Independent Auditor's Report
-8-
<PAGE> 31
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1996 and 1995
Note 2 - Related Party Transactions (Continued)
Under the terms of the Agreement, if the General Partners or their
affiliates provide a substantial amount of services in connection with
the sale of a property, or a portion of it, acquired through foreclosure
or otherwise, they shall be paid a commission not to exceed the lesser of
1) one-half of the normal and competitive percentage of gross sales price
charged for similar services by an unaffiliated partner; or 2) 3% of the
gross sales price of the property. The payment shall be subordinate to a
return of all of the limited partners' capital contributions and the
payment to the limited partners of their cumulative unpaid priority
returns.
Units were offered to the public through TMP Capital Corp. ("TMP
Capital"), an affiliate of the General Partners, as managing
broker-dealer. As the managing broker-dealer, TMP Capital received a
sales commission of up to 10% of the gross proceeds, up to 8% of which
was reallocated to soliciting dealers on units sold by them. These sales
commissions were paid by TMP Realty, Inc.
During 1996, 1995 and 1994, the Partnership was charged $21,421, $17,624
and $21,381, respectively, (of which $105, $0 and $869 is included in the
accrued expense balance at year-end) by TMP Investments, Inc. for cost
reimbursements for office and secretarial expenses.
Note 3 - Mortgage loans on real estate
The loan agreements require borrowers to place funds from the loan
proceeds in a restricted bank account equal to the total interest
payments over the term of the loan.
The Partnership receives a first security interest in said account as
additional collateral for the payment of the note. The borrowers instruct
the bank to pay to the Partnership the amount of the monthly loan
payment. In view of this, the only accrual of interest on the loans is
for the portion of each month the loan is earning interest until the
first of the following month when the funds are released from the
restricted account.
In the event of foreclosure, the collateral would be recorded at its fair
value at the time of foreclosure. Fair value would be considered to be
the lower of (a) appraised value determined by an independent real estate
appraiser, or (b) the general partners' determination of the value of the
property based on their analysis.
See Independent Auditor's Report
-9-
<PAGE> 32
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1996 and 1995
Note 3 - Mortgage loans on real estate (Continued)
The Partnership would consider collateral for a loan in substance
foreclosed if all the following criteria are met:
1. The borrower has little or no equity in the collateral,
considering the current fair value of the collateral; and
2. Proceeds for repayment of the loan can be expected to come
only from the operation or sale of the collateral; and
3. The borrower has either:
(a) formally or effectively abandoned control of the
collateral to the Partnership, or
(b) retained control of the collateral but, because of
the current financial condition of the borrower, or
the economic prospects for the borrower and/or the
collateral in the foreseeable future, it is doubtful
that the borrower will be able to rebuild equity in
the collateral or otherwise repay the loan in the
foreseeable future.
If this occurred, the collateral would be considered foreclosed and would
be recorded at its fair value.
The Olson #2 note for $500,000 matured December 17, 1994, went into
default and was foreclosed on April 26, 1995. The collateral (land) was
recorded in the accounts at the loan amount which approximates the fair
value of the land.
The Environmental Development loan for $1,625,000 matured October 15,
1994, went into default and was foreclosed on August 23, 1995. The
collateral (land) was recorded in the accounts at the loan amount which
approximates the fair value of the land.
During the year ended December 31, 1995 the Singletary loan for
$2,200,000 and the Lansing loan for $625,000 were paid in full.
The LaMonte loan for $1,220,000 defaulted on April 26, 1995 and was
foreclosed January 17, 1996. The collateral (land) was recorded in the
accounts at the loan amount which approximates the fair value of the
land.
See Independent Auditor's Report
-10-
<PAGE> 33
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1996 and 1995
Note 3 - Mortgage loans on real estate (Continued)
The Rockfield Development loan for $100,000 defaulted on April 13, 1995
and foreclosure was completed on January 17, 1996. The Partnership
acquired the collateral (land) and transferred it to TMP Mortgage Income
Plus, Ltd. in exchange for an interest in a project.
The Peppertree loan for $2,000,000 matured June 28, 1995 and was paid
July 30, 1996. $1,500,000 was received in cash and $500,000 was received
in the form of a 20% interest in a 163.33 acre project named Village One.
Note 4 - Investments
Following is a summary of the investments of the Partnership as of
December 31, 1996 and 1995.
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
TMP Flowerfield, LLC $ 140,233 $ 216,144
TMP Remington, LLC 523,803 241,247
Steadfast HSC, LLC 1,006,206 868,378
TMP Flowerfield - Sun City, LLC 341,685 0
Peppertree Park, LLC 500,000 0
TMP Mortgage Income Plus, L.P. project 285,739 0
---------- ----------
$2,797,666 $1,325,769
========== ==========
</TABLE>
The Partnership has a controlling interest in the above entities and the
equity method is used to account for its share of the entities' earnings.
None of the assets or liabilities of the entities are reflected in the
Partnerships accounts.
See Independent Auditor's Report
-11-
<PAGE> 34
Supplementary Information
<PAGE> 35
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Schedule I - Mortgage Loans on Real Estate
(Schedule XII, Rule 12-29, for SEC Reporting Purposes)
December 31, 1996
<TABLE>
<CAPTION>
COLUMN A B C D E F G H
- -----------------------------------------------------------------------------------------------------------------
Principal
Amount of
Loans Subject
Final Periodic Face Carrying to Delinquent
Description Interest Maturity Payment Prior Amount of Amount of Principal or
of Loans (A) Rate Date Term Liens Mortgages Mortgages Interest
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
None n/a n/a n/a n/a 0 0 0
Beginning balance $ 3,320,000
Additions during period:
New mortgage loans 0
Reduction during period
Loans paid off (2,000,000)
Loans foreclosed (1,320,000)
-----------
Ending balance $ 0
===========
</TABLE>
-12-
<PAGE> 36
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Schedule I - Mortgage Loans on Real Estate
(Schedule XII, Rule 12-29, for SEC Reporting Purposes)
December 31, 1995
<TABLE>
<CAPTION>
COLUMN A B C D E F G H
- ------------------------------------------------------------------------------------------------------------------
Principal
Amount of
Loans Subject
Final Periodic Face Carrying to Delinquent
Description Interest Maturity Payment Prior Amount of Amount of Principal or
of Loans (A) Rate Date Term Liens Mortgages Mortgages Interest
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1. Rockfield Development (Note 3) 12.5% 3/1/95 (B) None $ 100,000 $ 100,000 $ 100,000
2. La Monte (Note 3) 12.5% 4/25/95 (B) None 1,220,000 1,220,000 1,220,000
3. Peppertree Land Company (Note 3) 12.5% 6/28/95(C) (B) None 2,000,000 2,000,000 None
---------- ---------- ----------
$3,320,000 $3,320,000 $1,320,000
========== ========== ==========
Beginning balance $8,270,000
Additions during period:
New mortgage loans 0
Reduction during period
Loans paid off ( 2,825,000)
Loans foreclosed ( 2,125,000)
----------
Ending balance $ 3,320,000
==========
</TABLE>
(A) All loans are first mortgage on unimproved property in the Southern
California area.
(B) All loans provide for level monthly payments of interest only with the
entire face amount of the mortgage due at maturity.
(C) This loan was originally due on June 28, 1995 and was extended up to
December 28, 1995. Currently under another agreement it is on a
month-to-month basis.
-13-
<PAGE> 37
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Schedule I - Mortgage Loans on Real Estate
(Schedule XII, Rule 12-29, for SEC Reporting Purposes)
December 31, 1994
<TABLE>
<CAPTION>
COLUMN A B C D E F G H
- ------------------------------------------------------------------------------------------------------------------------
Principal
Amount of
Loans Subject
Final Periodic Face Carrying to Delinquent
Description Interest Maturity Payment Prior Amount of Amount of Principal or
of Loans (A) Rate Date Term Liens Mortgages Mortgages Interest
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. Olson #2 (Note 3) 12.5% 12/17/94 (B) None $ 500,000 $ 500,000 $500,000
2. Rockfield Development 12.5% 3/1/95 (B) None 100,000 100,000 None
3. Singletary 12.5% 4/12/95 (B) None 2,200,000 2,200,000 None
4. La Monte 12.5% 4/25/95 (B) None 1,220,000 1,220,000 None
5. Environmental Development 12.5% 5/15/95 (B) None 1,625,000 1,625,000 None
6. Peppertree Land Company 12.5% 6/28/95 (B) None 2,000,000 2,000,000 None
7. Gregg Lansing 12.5% 9/23/95 (B) None 625,000 625,000 None
---------- --------- --------
$ 8,270,000 $8,270,000 $500,000
=========== ========== ========
Beginning balance $12,890,000
Additions during period:
New mortgage loans 2,725,000
Reduction during period
Loans paid off ( 600,000)
Loans foreclosed ( 6,745,000)
----------
Ending balance $ 8,270,000
==========
</TABLE>
(A) All loans are first mortgage on unimproved property in the Southern
California area.
(B) All loans provide for level monthly payments of interest only with the
entire face amount of the mortgage due at maturity.
-14-
<PAGE> 38
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Schedule I - Mortgage Loans on Real Estate
(Schedule XII, Rule 12-29, for SEC Reporting Purposes)
December 31, 1993
<TABLE>
<CAPTION>
COLUMN A B C D E F G H
- ------------------------------------------------------------------------------------------------------------------======
Principal
Amount of
Loans Subject
Final Periodic Face Carrying to Delinquent
Description Interest Maturity Payment Prior Amount of Amount of Principal or
of Loans (A) Rate Date Term Liens Mortgages Mortgages Interest
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. PR Equities 12.5% 1/13/94 (B) None $2,400,000 $2,400,000 None
2. Frame 12.5% 1/28/94 (B) None 600,000 600,000 None
3. Sunset Crossing 12.5% 8/27/94 (B) None 1,875,000 1,875,000 None
4. PR Equities 12.5% 5/30/94 (B) None 1,150,000 1,150,000 None
5. Olson 12.5% 6/24/94 (B) None 1,320,000 1,320,000 None
--------- ---------
$7,345,000 $7,345,000
</TABLE>
(A) All loans are first mortgage on unimproved property in the Southern
California area.
(B) All loans provide for level monthly payments of interest only with the
entire face amount of the mortgage due at maturity.
-15-
<PAGE> 39
TMP LAND MORTGAGE FUND, LTD.
(A California Limited Partnership)
Schedule I - Mortgage Loans on Real Estate
(Schedule XII, Rule 12-29, for SEC Reporting Purposes)
December 31, 1993
<TABLE>
<CAPTION>
COLUMN A B C D E F G H
- ------------------------------------------------------------------------------------------------------------------------
Principal
Amount of
Loans Subject
Final Periodic Face Carrying to Delinquent
Description Interest Maturity Payment Prior Amount of Amount of Principal or
of Loans (A) Rate Date Term Liens Mortgages Mortgages Interest
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. PR Equities (Note 3) 12.5% 1/14/94 (B) None $ 2,400,000 $ 2,400,000 None
2. Toman Company (Note 3) 12.5% 7/28/94 (B) None 600,000 600,000 None
3. Sunset Crossing (Note 3) 12.5% 8/27/94 (B) None 1,875,000 1,875,000 None
4. PR Equities 12.5% 5/30/94 (B) None 1,150,000 1,150,000 None
5. Olson 12.5% 6/24/94 (B) None 1,320,000 1,320,000 None
6. Environmental Development 12.5% 10/15/94 (B) None 1,625,000 1,625,000 None
7. Olson #2 12.5% 12/17/94 (B) None 500,000 500,000 None
8. Singletary 12.5% 4/12/95 (B) None 2,200,000 2,200,000 None
9. La Monte 12.5% 4/25/95 (B) None 1,220,000 1,220,000 None
---------- ----------
$12,890,000 $12,890,000
Beginning balance $ 7,345,000
Additions during period:
New mortgage loans 5,545,000
Ending balance $12,890,000
</TABLE>
(A) All loans are first mortgage on unimproved property in the Southern
California area.
(B) All loans provide for level monthly payments of interest only with the
entire face amount of the mortgage due at maturity.
-16-
<PAGE> 40
TMP LAND MORTAGE FUND, LTD.
(A California Limited Partnership)
Schedule II - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
December 31, 1996
<TABLE>
<CAPTION>
COLUMN A B C D E
- ---------------------------------------------------------------------------------------------------------------------------
COSTS CAPITALIZED
SUBSEQUENT Gross
TO ACQUISITION amount
at which
Initial Carrying Carried at
Description of Assets Encumbrances Costs Improvements Costs Year-End
--------------------- ------------ ----- ------------ ----- --------
<S> <C> <C> <C> <C> <C>
Unimproved land - San Jacinto, CA 0 $3,550,000 $ 63,737 $2,459,279 $ 6,073,016
Unimproved land - Sun City, CA 0 1,320,000 638 25,619 1,346,257
Unimproved land - Banning, CA 0 1,875,000 1,500 48,581 1,925,081
Unimproved land - San Diego 0 1,658,000 15,207 63,870 1,737,077
Unimproved land - Sun City 0 500,000 4,780 5,162 509,942
Unimproved land - Simi Valley 0 1,220,000 72,794 54,963 1,347,757
- --------- ------ ------ ---------
0 $10,123,000 $158,656 $2,657,474 $12,939,130
= =========== ======== ========== ===========
Reconciliation of carrying amount
Beginning balance $ 9,633,530
Additions
Initial costs $1,220,000
Improvements 67,569
Carrying costs 2,018,031
----------
Total additions 3,305,600
-----------
Ending balance $12,939,130
===========
</TABLE>
<TABLE>
<CAPTION>
------------------------------------------------------
F G H I
------------------------------------------------------
Estimated
Accumulated Date of Date Depreciable
Description of Assets Depreciation Construction Acquired Life
--------------------- ------------ ------------ -------- ----
<S> <C> <C> <C> <C>
Unimproved land - San Jacinto, CA 0 n/a 6/2/94 &
8/11/94 n/a
Unimproved land - Sun City, CA 0 n/a 11/2/94 n/a
Unimproved land - Banning, CA 0 n/a 12/21/94 n/a
Unimproved land - San Diego 0 n/a 8/23/95 n/a
Unimproved land - Sun City 0 n/a 4/26/95 n/a
Unimproved land - Simi Valley 0 n/a 4/22/96 n/a
-
0
=
Reconciliation of carrying amount
Beginning balance
Additions
Initial costs
Improvements
Carrying costs
Total additions
Ending balance
</TABLE>
-17-
<PAGE> 41
TMP LAND MORTAGE FUND, LTD.
(A California Limited Partnership)
Schedule II - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
December 31, 1995
<TABLE>
<CAPTION>
COLUMN A B C D E
- --------------------------------------------------------------------------------------------------------------------------
COSTS CAPITALIZED Gross
SUBSEQUENT amount
TO ACQUISITION
at which
Initial Carrying Carried at
Description of Assets Encumbrances Costs Improvements Costs Year-End
--------------------- ------------ ----- ------------ ----- --------
<S> <C> <C> <C> <C> <C>
Unimproved land - San Jacinto, CA 0 $3,550,000 $63,737 $566,979 $4,180,7160
Unimproved land - Sun City, CA 0 1,320,000 637 11,377 1,332,014
Unimproved land - Banning, CA 0 1,875,000 0 25,739 1,900,739
Unimproved land - San Diego 0 1,658,000 13,399 33,299 1,704,698
Unimproved land - Sun City 0 500,000 4,780 2,049 506,829
Unimproved land - Simi Valley 0 0 8,534(A) 0 8,534
- - ----- - -----
0 $8,903,000 $91,087 $639,443 $9,633,530
= ========== ======= ======== ==========
Reconciliation of carrying amount
Beginning balance $6,801,462
Additions
Initial costs $2,158,000
Improvements 41,696
Carrying costs 632,372
----------
Total additions 2,832,068
----------
Ending balance $9,633,530
==========
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------------
F G H I
---------------------------------------------------------------
Estimated
Accumulated Date of Date Depreciable
Description of Assets Depreciation Construction Acquired Life
--------------------- ------------ ------------ -------- ----
<S> <C> <C> <C> <C>
Unimproved land - San Jacinto, CA 0 n/a 6/2/94 &
8/11/94 n/a
Unimproved land - Sun City, CA 0 n/a 11/2/94 n/a
Unimproved land - Banning, CA 0 n/a 12/21/94 n/a
Unimproved land - San Diego 0 n/a 8/23/95 n/a
Unimproved land - Sun City 0 n/a 4/26/95 n/a
Unimproved land - Simi Valley 0 n/a (A) n/a
-
0
=
Reconciliation of carrying amount
Beginning balance
Additions
Initial costs
Improvements
Carrying costs
Total additions
Ending balance
</TABLE>
(A) Costs incurred for defaulted loan. The property is under foreclosure as of
December 31, 1995. (See Note 3)
-18-
<PAGE> 42
TMP LAND MORTAGE FUND, LTD.
(A California Limited Partnership)
Schedule II - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
December 31, 1994
<TABLE>
<CAPTION>
COLUMN A B C D E
- --------------------------------------------------------------------------------------------------------------------------
COSTS CAPITALIZED Gross
SUBSEQUENT amount
TO ACQUISITION
at which
Initial Carrying Carried at
Description of Assets Encumbrances Costs Improvements Costs Year-End
--------------------- ------------ ----- ------------ ----- --------
<S> <C> <C> <C> <C> <C>
Unimproved land - San Jacinto, CA 0 $3,550,000 $49,391 0 $3,599,391
Unimproved land - Sun City, CA 0 1,320,000 0 0 1,320,000
Unimproved land - Banning, CA 0 1,875,000 0 7,071 1,882,071
- --------- - ----- ---------
0 $6,745,000 $49,391 $ 7,071 $6,801,462
= ========== ======= ======= ==========
Reconciliation of carrying amount
Beginning balance $ 0
Additions
Initial costs $6,745,000
Improvements 49,391
Carrying costs 7,071
----------
Total additions 6,801,462
----------
Ending balance $6,801,462
==========
</TABLE>
<TABLE>
<CAPTION>
-----------------------------------------------------------
F G H I
-----------------------------------------------------------
Estimated
Accumulated Date of Date Depreciable
Description of Assets Depreciation Construction Acquired Life
--------------------- ------------- ------------ -------- ----
<S> <C> <C> <C> <C>
Unimproved land - San Jacinto, CA 0 n/a 6/2/94 &
8/11/94 n/a
Unimproved land - Sun City, CA 0 n/a 11/2/94 n/a
Unimproved land - Banning, CA 0 n/a 12/21/94 n/a
-
0
=
Reconciliation of carrying amount
Beginning balance
Additions
Initial costs
Improvements
Carrying costs
Total additions
Ending balance
</TABLE>
-19-
<PAGE> 43
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Dated April 14, 1997.
TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
by TMP INVESTMENTS, INC.,
a California corporation as co-general
Partner
By /s/ WILLAIM O. PASSO
------------------------------------
William O. Passo, President
By /s/ ANTHONY W. THOMPSON
------------------------------------
Anthony W. Thompson, Executive Vice
President
By /s/ JENNY REX
------------------------------------
Jenny Rex, Vice President Operations
and TMP PROPERTIES, a California General
Partnership as co-general Partner
By /s/ WILLIAM O. PASSO
------------------------------------
William O. Passo
By /s/ ANTHONY W. THOMPSON
------------------------------------
Anthony W. Thompson
By /s/ SCOTT E. McDANIEL
------------------------------------
Scott E. McDaniel
<PAGE> 44
EXHIBIT INDEX
3 & 4 Amended and Restated Agreement of Limited
Partnership incorporated by reference to Exhibit 4.1 filed in Form S-11,
SEC File No. 33-39238 on April 13, 1992.
10 Material contracts are incorporated by reference
as follows:
Incorporated by reference to Amendment No. 1 as filed with
the SEC on September 14, 1992.
10.1.1 Loan Agreement - PR Equities Loan (Loan #1)
10.1.2 Promissory Note - PR Equities Loan (Loan #1)
10.1.3 Deed of Trust - PR Equities Loan (Loan #1)
10.2.1 Loan Commitment - PR Equities Loan (Loan #2)
10.3.1 Loan Agreement - Frame Loan (Loan #3)
10.3.2 Promissory Note - Frame Loan (Loan #3)
10.3.3 Deed of Trust - Frame Loan (Loan #3)
10.4.1 Loan Agreement - Sunset Crossing Loan (Loan #4)
10.4.2 Promissory Note - Sunset Crossing Loan (Loan #4)
10.4.3 Deed of Trust - Sunset Crossing Loan (Loan #4)
10.4.4 Personal Guaranty - Sunset Crossing Loan (Loan #4)
10.4.5 Promissory Note - Bank Loan for Bridge
Financing - Sunset Crossing Loan (Loan #4)
Incorporated by reference to Amendment No. 3 as filed with
the SEC on February 24, 1993.
10.7.1 Loan Agreement - PR Equities Loan (Loan #2)
10.7.2 Promissory Note - PR Equities Loan (Loan #2)
10.7.3 Deed of Trust - PR Equities Loan (Loan #2)
10.10.1 Loan Agreement - Fox-Olson Loan (Loan #5)
10.10.2 Promissory Note- Fox-Olson Loan (Loan #5)
10.10.3 Deed of Trust - Fox-Olson Loan (Loan #5)
10.11.1 Loan Agreement - Environmental
Development, Ltd. (Loan #6)
10.11.2 Promissory Note - Environmental Development,
Ltd. (Loan #6)
10.11.3 Deed of Trust - Environmental Development
Ltd. (Loan #6)
Incorporated by reference to Amendment No. 6 as filed with the
SEC on September 14, 1993:
10.8.4 Modification of Promissory Note - Frame
Loan (Loan #3)
10.12.1 Loan Agreement - Fox-Olson Loan 2 (Loan #7)
10.12.2 Promissory Note - Fox-Olson Loan 2 (Loan #7)
10.12.3 Deed of Trust - Fox-Olson Loan 2 (Loan #7)
Incorporated herein by reference to Exhibits A through H filed
with the Registrant's Current Report on Form 8-K, dated October 12, 1993, SEC
File No. 0-19933:
10.13.1 Loan Agreement - Singletary Loan (Loan #8)
10.13.2 Promissory Note - Singletary Loan (Loan #8)
10.13.3 Deed of Trust - Singletary Loan (Loan #8)
10.14.1 Loan Agreement - LaMonte Loan (Loan #9)
10.14.2 Promissory Note - LaMonte Loan (Loan #9)
10.14.3 Deed of Trust - LaMonte Loan (Loan #9)
10.14.4 Subordination, Non-disturbance and
Attornment Agreement - LaMonte Loan
(Loan #9)
10.14.5 Consent to and Subordination of Deed of
Trust - LaMonte Loan (Loan #9)
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000872836
<NAME> TMP LAND MORTGAGE FUND, LTD.
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 131,405
<SECURITIES> 0
<RECEIVABLES> 200
<ALLOWANCES> 0
<INVENTORY> 15,736,796
<CURRENT-ASSETS> 15,868,401
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 15,868,401
<CURRENT-LIABILITIES> 2,706,526
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 13,161,875
<TOTAL-LIABILITY-AND-EQUITY> 15,868,401
<SALES> 64,051
<TOTAL-REVENUES> 64,051
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 800
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 63,251
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 63,251
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
