<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of
The Securities Exchange Act of 1934
for the Quarterly Period ended September 30, 1997
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)
(Address of principal executive office)
(714) 836-5503
(Registrant's telephone number, including area code)
----------------------
Indicate by check mark whether Registrant has [1] filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or such shorter period that the registrant was required
to file such reports) and [2] has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following financial statements are filed as a part of this Form 10-Q:
Balance Sheets as of September 30, 1997 and December 31, 1996,
Statements of Income for the three and nine months ending September 30,
1997 and 1996,
Statements of Cash Flows for the nine months ended September 30, 1997
and 1996.
The accompanying unaudited interim financial statements include all adjustments
(consisting solely of normal recurring adjustments) which are, in the opinion of
the General Partners, necessary to fairly present the financial position of the
Partnership as of September 30, 1997 and the results of its operations, changes
in partners' equity, and cash flows for the nine month period then ended.
<PAGE> 3
TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
Balance Sheets
<TABLE>
<CAPTION>
Sept 30, 1997 Dec 31, 1996
(Unaudited) (Audited)
------------ ------------
<S> <C> <C>
Assets
Cash $ 919,643 $ 131,405
Accounts Receivable 44,942 200
Mortgage Loans on Real Estate -- --
Property Held for Sale 12,492,236 12,939,130
Investment in Joint Venture 2,064,146 2,797,666
------------ ------------
Total Assets $ 15,520,967 $ 15,868,401
============ ============
Liabilities and Partners' Capital
Accounts Payable $ 900 $ 800
Due to Affiliates 49,626 23,885
Property Taxes Payable 3,490,961 2,681,842
------------ ------------
Total Liabilities $ 3,541,487 $ 2,706,527
Partners' Capital
General Partners (47,907) (25,585)
Limited Partners 20,000 equity
units authorized; 15,715 units
outstanding as of June 30, 1997
and December 31, 1996 $ 12,027,387 $ 13,187,459
------------ ------------
Total Partners' Capital $ 11,979,480 $ 13,161,874
------------ ------------
Total Liabilities & Partners' Capital $ 15,520,967 $ 15,868,401
============ ============
</TABLE>
<PAGE> 4
TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Sept 30, Sept 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Income
Property Sales $1,950,000 $ 0 $1,950,000 $ 0
Interest Income 7,037 91,264 13,338 158,015
Joint Venture Income 0 17,347 550,048 81,131
Other Income 900 1,900 2,700 3,700
---------- ---------- ---------- ----------
Total Income $1,957,937 $ 110,511 $2,516,086 $ 242,846
Expenses
Cost of Sales $1,395,665 $ 0 $1,395,665 $ 0
Loan Costs 42,693 0 42,693 0
Outside Services 2,148 0 14,628 1,020
Joint venture Expense 3,863 0 13,129 151
---------- ---------- ---------- ----------
Total Expenses $1,444,369 $ 0 $1,466,115 $ 1,171
---------- ---------- ---------- ----------
Net Income $ 513,568 $ 110,511 $1,049,971 $ 241,675
========== ========== ========== ==========
Allocation of Net Income
General Partners
in the Aggregate: $ 5,135 $ 1,105 $ 10,500 $ 2,417
Limited Partners
in the Aggregate: $ 508,433 $ 109,406 $1,039,471 $ 239,258
Limited Partners
per equity unit: $ 32.35 $ 6.96 $ 66.14 $ 15.22
</TABLE>
<PAGE> 5
TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Sept 30,
1997 1996
<S> <C> <C>
Cash Flow From Operating activities:
Net Income $ 1,049,971 $ 241,675
Adjustments to reconcile net income to net cash provided by operating
activities:
Increase (Decrease) in Accounts Payable 100 (17,476)
Increase (Decrease) in Accrued Expenses 834,860 2,097,263
Decrease (Increase) in Loans Receivable 0 3,320,000
Decrease (Increase) in Accounts Receivable (44,742) 127,036
----------- -----------
Net Cash Provided By (Used In) Operating
Activities $ 1,840,189 $ 5,768,498
(Increase) Decrease in Carrying Cost
of Properties 446,894 (3,575,902)
Decrease (Increase) in investment in
Joint Venture 733,520 (1,430,854)
----------- -----------
Net Cash Provided By (Used In) Investing
Activities $ 1,180,414 $(5,006,756)
Distributions to partners $(2,232,365) $ (682,570)
----------- -----------
Net Cash Provided By (Used In) Financing
Activities $(2,232,365) $ (682,570)
----------- -----------
Net Increase (Decrease) in Cash $ 788,238 $ 79,172
Cash, beginning of period $ 131,405 $ 81,957
----------- -----------
Cash, end of period $ 919,643 $ 161,129
=========== ===========
</TABLE>
<PAGE> 6
TMP LAND MORTGAGE FUND, LTD.
A California Limited Partnership
for the Nine Months Ended September 30, 1997
NOTE 1 - Summary of Significant Accounting Policies
Accounting Method - TMP Land Mortgage Fund, Ltd. (the Partnership) prepares its
financial statements on the accrual method of accounting.
Allowance for Losses on Loans - No provision has been made for an allowance for
losses on loans.
Income Taxes - The entity is treated as a partnership for income tax purposes
and any income or loss is passed through and taxable at the partner level.
Accordingly, no provision for federal income taxes is provided.
NOTE 2 - Allocation of Profits, Losses and Cash Distributions
Profits, losses and cash distributions are allocated 99 percent to the limited
partners and one percent to the general partners until the limited partners have
received an amount equal to their capital contributions plus a cumulative,
non-compounded return of eight percent per annum, based on their adjusted
capital account balances. At that point, remaining profits, losses and cash
distributions are allocated 76 percent to the limited partners and 24 percent to
the general partners.
As of September 30, 1997 and 1996, profits, losses and cash distributions were
allocated 99 percent to the limited partners and one percent to the general
partners.
The Partnership had 15,715 units outstanding as of September 30, 1997 and 1996.
NOTE 3 - Property Held for Sale
The Partnership had made twelve land loans as of September 30, 1997. Three of
the loans had been repaid in full, and nine of the loans had defaulted. On all
the defaults which had occurred, the Partnership foreclosed on the properties
securing the loans.
NOTE 4 - Investment in Joint Venture
The Partnership has contributed property as an investment in five single family
development joint ventures. The Partnership has a controlling interest in the
entities and the equity method is used to account for its share of the entities'
earnings.
NOTE 5 - Property Taxes Payable
As of September 30, 1997, the Partnership owed approximately $3,454,000 in
property taxes payable on the PR Equities properties. This includes
approximately $2,500,000 of Mello-Roos tax. In addition, the Partnership owed
approximately $36,000 in property taxes on the other Partnership properties. If
the property taxes remain delinquent for five years, the County can foreclose on
the property.
<PAGE> 7
TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
for the Nine Months ended September 30, 1997
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
TMP Land Mortgage Fund, Ltd., is a California Limited Partnership formed in
April, 1992, of which TMP Investments, Inc., a California corporation, and TMP
Properties, a California general partnership, are the General Partners (the
"General Partners"). The Partnership was formed principally to make short-term
loans to unaffiliated parties secured by first trust deeds on unimproved
properties, primarily in the Inland Empire area of Southern California and in
some instances, in other areas of Southern California, and to provide cash
distributions to the Limited Partners, primarily from interest earned on the
mortgage loans. The Partnership is not a mutual fund or any other type of
investment company within the meaning of, and is not subject to regulations
under, the Investment Company Act of 1940.
As of September 30, 1997, the Partnership had received and accepted
subscriptions of 15,715 Units, representing total subscription proceeds in the
amount of $15,715,000. All proceeds had been committed to the twelve mortgage
loan investments made by the Partnership and to working capital reserves. During
1992, the Partnership funded five mortgage loans. Four loans were funded in 1993
and three loans were funded in 1994.
As a consequence of adverse changes in market conditions and other factors,
three of the loans were repaid and nine of the loans were foreclosed upon.
During the nine months ended September 30, 1997, the following activity occurred
on the properties which the Partnership owns:
PR Equities Loan #1 and #2
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
regular tax and Mello-Roos tax assessments against the Partnership's lots taken
back in foreclosure is over $3,000,000. 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,
with the overall bonded indebtedness and the annual debt service reduced.
The city was forced by the terms of the bonds to schedule a sale of the property
for delinquent bond assessments. The buyer would be required to pay the full
unpaid assessment, penalties, interest as well as assume the full amount of the
remaining assessment. The sale occurred in April 1997 but there was no buyer for
the properties; therefore, the Partnership continues to own these parcels.
During the third quarter of 1997, the bonds were purchased at a steep discount
and the General Partners believe that the land will ultimately be foreclosed
upon by the new bondholder(s).
<PAGE> 8
Environmental Development Loan
The Partnership accepted a deed in lieu of foreclosure and now owns the
property. A Joint Venture with TMP Homes has been formed to build single family
homes on the 181 lots. The final map and the improvement plans for Phase I and
II have been approved by the city. Tokai Bank has issued a letter of intent to
provide a construction loan.
Fox Olson Loan #2
Property on Newport Avenue west of the Interstate 215 is now owned by the
Partnership. A Joint Venture with TMP Homes has been formed to build 45 single
family homes. The final map has been approved by the city and First Bank & Trust
has expressed an interest in providing a construction loan.
LaMonte Loan
The Partnership acquired this 6.5 acre commercial property through foreclosure
in April, 1996. During September 1997, the property was sold for a profit of
approximately $500,000.
Distributions to investors began August 1, 1992, and continued monthly through
May 1, 1995. On June 1, 1995, the General Partners suspended distributions due
to the default and subsequent foreclosure on several of the mortgage loans.
During 1997, the Partnershhip made two distributions from the proceeds of the
two 1997 property sales.
During the nine months ended September 30, 1997, the Partnership generated
approximately $3,000,000 of cash from the sale of the Hollywood Studio Club
Apartments and the `LaMonte' land. There was no interest received on mortgage
loans. Approximately $2,200,000 was distributed to investors from the proceeds
of these two sales.
Management believes there is sufficient cash to meet anticipated Partnership
cash needs for the next 12 months. However, management does not plan to pay the
Mello Roos taxes on the PR Equities properties unless the bonds can be
restructured under more favorable terms.
The Partnership will maintain reserves for working capital and contingency
reserves in an amount as the General Partners deem necessary for the operation
of the business of the Partnership. In addition, the Partnership may incur
indebtedness as necessary for development or other expenses incurred in holding
the properties and/or developing the property in conjunction with an affiliated
development company. The Partnership is making every effort to develop and/or
sell all of the properties which it holds.
<PAGE> 9
TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
for the Nine Months ended September 30, 1997
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: December 12, 1997
TMP LAND MORTGAGE FUND, LTD.
a California Limited Partnership
By: TMP Investments, Inc., as General Partner
By:_______________________________________
William O. Passo, President
By:_______________________________________
Anthony W. Thompson, Exec. V.P.
By:_______________________________________
Richard Hutton, Jr., Controller
By: TMP Properties, a California General
Partnership as General Partner
By:_______________________________________
William O. Passo, General Partner
By:_______________________________________
Anthony W. Thompson, General Partner
By:_______________________________________
Scott E. McDaniel, General Partner
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 919,643
<SECURITIES> 0
<RECEIVABLES> 44,942
<ALLOWANCES> 0
<INVENTORY> 14,556,382
<CURRENT-ASSETS> 15,520,967
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 15,520,967
<CURRENT-LIABILITIES> 3,541,487
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 11,979,480
<TOTAL-LIABILITY-AND-EQUITY> 15,520,967
<SALES> 1,957,937
<TOTAL-REVENUES> 1,957,937
<CGS> 1,438,358
<TOTAL-COSTS> 1,438,358
<OTHER-EXPENSES> 6,011
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 513,568
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 513,568
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
