<PAGE>
The registrant is filing restated 1994-1997 financial statements. These
restatements reflect changes discussed in Note 7 to the consolidated financial
statements.
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
Quarterly Report Pursuant to Section 13 or 15(d)
of
The Securities Exchange Act of 1934
For the Quarterly Period ended June 30, 1998
Commission File No. 0-19963
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 (IRS Employer Identification No.)
of incorporation or organization)
801 North Parkcenter Drive, Suite 235
Santa Ana, California 92705
(Address of principal executive office) (Zip Code)
(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 requirement for
the past 90 days.
Yes [X ] No [ ]
<PAGE>
TMP LAND MORTGAGE FUND, LTD
INDEX
PART IFINANCIAL INFORMATION Page
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1998 (unaudited)
and December 31, 1997 3
Consolidated Statements of Operations for the
Three and Six Months ended June 30, 1998 and
1997 (unaudited) 4-5
Consolidated Statements of Cash Flows for the Six Months ended
June 30, 1998 and 1997 (unaudited) 6-7
Notes to Consolidated Financial Statements (unaudited) 8-11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12-16
PART II OTHER INFORMATION
Item 1. Legal Proceedings 17
Item 2. Changes in Securities 17
Item 3. Defaults Upon Senior Securities 17
Item 4. Submission of Matters to a Vote of Security Holders 17
Item 5. Other Information 17
Item 6. Exhibits and Reports on Form 8-K 17
SIGNATURES 18
2
<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Consolidated Balance Sheets
June 30,
1998 December 30,
(unaudited) 1997
----------- ------------
Assets
------
<S> <C> <C>
Cash $ 616,740 $ 960,479
Other Receivable 433,661 125,337
Prepaid expenses 25,019 0
Due from Affiliates (net of unamortized
discount of $161,445 and $103,136,
respectively) 289,293 182,603
Investment in Unimproved Land (net of
valuation allowance of $4,148,274
and $4,042,856, respectively) 11,517,266 10,687,386
Investment in Joint Venture 608,038 607,590
-------------- --------------
Total Assets $ 13,490,017 $ 12,563,395
=============== ===============
Liabilities and Partners' Capital
---------------------------------
Accounts Payable $ 143,205 $ 74,594
Due to Affiliates 5,109 29,294
Due to Manager (Note 1) 4,513 0
Property Taxes Payable 4,677,526 4,206,068
Accrued Expenses (Note 5) 800 800
Construction Loan 36,158 0
-------------- --------------
Total Liabilities 4,831,153 4,310,756
-------------- --------------
Minority Interest 459,992 309,533
Partners' Capital
General Partners (75,575) (77,771)
Limited Partners, 20,000 equity
units authorized; 15,715 units
outstanding as of March 31, 1998
and December 31, 1997 8,238,289 8,020,877
-------------- --------------
Total Partners' Capital 8,162,714 7,943,106
-------------- --------------
Total Liabilities and Partners' Capital $ 13,490,017 $ 12,563,395
=============== ===============
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
3
<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Consolidated Statements of Operations
(Unaudited)
Three Months Ended
June 30, June 30,
1998 1997
---- ----
Income
- ------
<S> <C> <C>
Interest Income $ 9,786 $ 12,751
Joint Venture Income 0 45,124
Gain or Loss on Investments 295,098 (33,837)
Other Income 600 900
-------------- -------------
Total Income 305,484 24,938
-------------- -------------
Expenses
- --------
Loss on Decline in Market Value of Property 4,495 4,761
Discount on Due from Affiliates 73,268 0
Operating Expenses 5,441 0
Outside Services 10,023 0
Joint Venture Expense 0 6,110
-------------- -------------
Total Expenses 93,227 10,871
-------------- -------------
Net Income before Minority Interest 212,257 14,067
Minority Interest (90) (671)
-------------- -------------
Net Income $ 212,167 $ 13,396
=============== ==============
Allocation of Net Income
General Partners $ 2,122 $ 133
=============== ==============
Limited Partners $ 210,045 $ 13,263
=============== ==============
Limited Partners, per unit $ 13.37 $ 0.84
=============== ==============
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
4
<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Consolidated Statements of Operations
(Unaudited)
Six Months Ended
June 30, June 30,
1998 1997
---- ----
Income
- ------
<S> <C> <C>
Interest Income $ 24,294 $ 21,422
Gain or Loss on Investments 268,596 (44,923)
Joint Venture Income 50,000 550,048
Other Income 1,800 1,800
------------- -------------
Total Income 344,690 528,347
------------- -------------
Expenses
- --------
Loss on Decline in Market Value of Property 13,245 4,761
Discount on Due from Affiliates 73,268 0
Operating Expenses 26,941 0
Outside Services 10,023 12,480
California Franchise Taxes 1,600 1,600
Joint Venture Expense 0 9,279
------------- -------------
Total Expenses 125,077 28,120
------------- -------------
Net Income before Minority Interest 219,613 500,027
Minority Interest in Investments (5) (885)
------------- -------------
Net Income $ 219,608 $ 499,342
============== ===============
Allocation of Net Income
General Partners $ 2,196 $ 4,993
============== ===============
Limited Partners $ 217,412 $ 494,349
============== ===============
Limited Partners, per unit $ 13.83 $ 31.46
============== ===============
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
5
<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Consolidated Statements of Cash Flows
(Unaudited)
Six Months Ended
June 30, June 30,
1998 1997
------- -------
<S> <C> <C>
Cash Flows From Operating Activities
Net Income (Loss) $ 219,608 $ 499,342
Adjustments to Reconcile Net Income to
Net Cash Used in Operating Activities:
Loss on Decline in Market Value
of Property 13,245 4,761
(Gain) or Loss on Investments (268,596) 44,923
Gain on Sale of Investment 0 (550,048)
Amortization of discount on
Due from Affiliates (14,958) (9,969)
Discount on Due from Affiliates 73,268 0
Minority Interest in Income of Subsidiary 5 885
Changes in assets and liabilities:
Increase (Decrease) in Accounts Payable 68,611 (4)
Increase in Prepaid Assets (25,019) 0
Increase in Accrued Expenses 0 (800)
Increase in Other Receivable (308,324) (148,083)
Increase in Due from Affiliates (165,000) 79,548
Decrease in Due to Affiliates (24,185) 0
Increase in Due to Manager 4,513 0
--------- ------------
Net Cash Used in Operating Activities (426,837) (79,445)
Cash Flows from Investing Activities:
Proceeds from Sale of Investment 0 1,725,096
Increase in Land Development Costs (332,973) (201,890)
Increase in Minority Interest 150,459 44,974
Increase in Carrying Costs of Property (38,694) (71,590)
Decrease (Increase) in Investment
in Joint Ventures 268,148 (213,763)
-------- -----------
Net Cash Provided by Investing Activities 46,940 1,282,827
-------- ----------
Cash Flows from Financing Activities:
Proceeds from Construction Loan 36,158 0
Distributions to Partners 0 (1,000,045)
-------- ------------
Net Cash Used in Financing Activities 36,158 (1,000,045)
-------- ------------
Net Increase (Decrease) in Cash (343,739) 203,337
Cash, Beginning of Period 960,479 361,515
-------- ------------
Cash, End of Period $ 616,740 $ 564,852
========= =============
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
6
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Consolidated Statements of Cash Flows, continued
(Unaudited)
Supplemental Schedule of Non-Cash Investing and Financing Activities:
Non-cash investing and financing activities during the six months ended June 30,
1998 consists of the Partnership capitalizing property taxes for foreclosed
properties of $703,388 as well as carrying costs of $38,694. A valuation
allowance of $13,245 was recorded to reduce the net carrying value of the
properties to their fair market values.
7
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Notes to Consolidated Financial Statements
(Unaudited)
The accompanying unaudited interim financial statements include all adjustments
(consisting solely of normal recurring adjustments) which are, in the opinion of
management, necessary to present fairly the financial position of the
Partnership as of June 30, 1998 and the results of its operations, and cash
flows for the period then ended in accordance with generally accepted accounting
principles for interim financial information.
NOTE 1 - The Partnership and its Significant Accounting Policies
TMP Land Mortgage Fund, Ltd. (the Partnership) was organized in accordance with
the provisions of the California Uniform Limited Partnership Act for the purpose
of acquiring, developing and operating real property. The General Partners in
the Partnership are William O. Passo, Anthony W. Thompson, Scott E. McDaniel of
TMP Properties, a California General Partnership and TMP Investments Inc.
On March 12, 1998, the General Partners of the Partnership entered into an
agreement (the Agreement) with PacWest Inland Empire, LLC (PacWest), Delaware
limited liability company, whereby PacWest paid the General Partners of the
Partnership and ten other related partnerships, a total of $300,000; and agreed
to pay up to a total of $300,000 for any deficit capital accounts for these 11
partnerships in exchange for the rights to distributions from the General
Partners; referred to as a "distribution fee" as defined by the Agreement.
PacWest entered into a management, administrative and consulting agreement as of
April 1, 1998, with the General Partners of the Partnership to provide the
Partnership with overall management, administrative and consulting services.
PacWest currently contracts with Preferred Partnership Services, Inc. and other
entities to perform certain of the financial, accounting and investor relation
services for the Partnership. As of June 30, 1998 the Partnership owes PacWest
$4,513 relating to this agreement. PacWest has also agreed to provide certain
liquidity to the Partnership as discussed in the MD&A section of this report.
The following is a summary of the Partnership significant accounting policies.
Basis of Presentation - The Partnership prepares its financial statements on the
- ---------------------
accrual basis of accounting.
Principles of Consolidation - The consolidated financial statements include the
- ---------------------------
accounts of the Partnership and its majority-owned investments, TMP Homes
Remington, LLC (Remington) and TMP Homes Flowerfield-Sun City, LLC (Sun City).
All significant intercompany accounts and transactions have been eliminated in
consolidation.
8
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 1 - The Partnership and its Significant Accounting Policies, Continued
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
Profit, losses, and cash distributions are allocated ninety-nine 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 which time, remaining profits, losses and
cash distributions are allocated seventy-six percent to the limited partners and
twenty-four percent to the general partners. Distributions of cash from
operations, if any, are made monthly within 30 days after the end of the month.
NOTE 3 - Investment in Unimproved Land
The Partnership had made twelve land loans as of June 30, 1998. 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 - Investments
The Partnership has a 75% membership interest in Flowerfield, which was
organized for the purpose of acquiring, owning and developing certain parcels of
land into single family home developments in San Jacinto, California. The equity
method is used to account for the Partnership's share of Flowerfield's earnings
or losses which is not materially different than the consolidation of this
majority owned investment.
The Partnership has a 20% interest in Peppertree, which was formed to acquire
and develop certain property in San Diego, California. The Partnership's 20%
interest is stated at its cost of $500,000. During 1998, Peppertree sold a
parcel of land for a total sales price of $5,455,000. The Partnership recorded
$50,000 for their portion of the gain on the sale of this property which is
included in other income on the consolidated statements of operations.
NOTE 5 - Property Taxes Payable
As of June 30, 1998, the Partnership owed approximately $4,400,000 in property
taxes payable on the PR Equities properties. This includes approximately
$3,600,000 of Mello-Roos tax. In addition, the
9
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 5 - Property Taxes Payable, continued
Partnership owed approximately $270,000 in property taxes on the other
Partnership properties. If the property taxes remain delinquent for five years,
the County can foreclose on the property.
NOTE 6 - Related Party Transactions
During 1996, the Partnership deeded a parcel of land and adnvaced funds to an
affiliate, Mortgage Income Plus and recorded a receivable for the total of
$285,739. Since the terms of the transaction call for a five-year interest free
note receivable, the Partnership recorded the note receivable at a discount of
12%. The Partnership is amortizing this discount over a five-year period. The
total amortization into income for the six months ending June 30, 1998 was
$11,234.
During the six months ended June 30, 1998 the Partnership loaned $165,000 to an
affiliate, Mortgage Income Plus. Since the terms of the transaction call for a
five-year interest free note receivable, the Partnership recorded the note
receivable at a discount of 12%. The Partnership is amortizing this discount
over a five-year period. The total discount recorded during the six months ended
June 30, 1998 was $73,268, and the amortization into income was $3,724.
NOTE 7 - Restatement and reissuance of 1994-1997 Financial Statements
In 1992, the Partnership made two loans totaling $3,500,000 to PR Equities,
Ltd., a California Limited Partnership. The loans were secured by first trust
deeds on residential property located in San Jacinto, California. In 1994, the
Partnership foreclosed on the properties securing these loans and continues to
own these properties. In accordance with generally accepted accounting
principles, assets acquired through foreclosure should be recorded at the lower
of cost or fair value less costs of disposal at the date of foreclosure. The
1994-1997 financial statements originally issued reported this property at the
amount of the outstanding mortgage balances due on these loans at the time of
foreclosure, which did not represent their fair value less costs of disposal.
Management has subsequently determined that a valuation allowance for these
properties should have been established for approximately $3.8 million at the
date of foreclosure in 1994. The valuation allowance should have been adjusted
each year thereafter such that the only value for these properties is the
capitalized direct carrying costs that represent the total accumulated property
taxes and Mello-Roos bond assessments. Therefore, the consolidated financial
statements for 1994 through 1996 have been restated to record the valuation
allowance and to adjust these properties to their fair value for those years.
In addition, management has determined that the amount of property taxes payable
as recorded in June, 1994, and subsequent periods, were understated by
approximately $368,000. Accordingly, the consolidated financial statements for
those periods have been restated for this understatement by adjusting the
carrying value of the land and the property taxes payable in the appropriate
fiscal years.
10
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 7 - Restatement and reissuance of 1994-1997 Financial Statements, continued
In accordance with generally accepted accounting principles, the financial
statements of majority-owned investments are required to be consolidated. The
1995, 1996 and 1997 financial statements originally issued did not properly
account for the consolidation of all significant majority-owned investments.
Therefore, the financial statements of these material majority owned entities
have been consolidated with the financial statements of the Partnership's and
have been restated for fiscal years 1995, 1996 and 1997 to reflect the
consolidation and related minority interests of $310,000 for Remington and Sun
City as of December 31, 1997 and $460,000 at June 30, 1998.
In November, 1996, the Partnership entered into a non-interest bearing note for
$286,000. In accordance with generally accepted accounting principles, the note
should have been discounted at the date of execution and interest accreted over
the period of the note for $127,000. The consolidated financial statements have
been restated for this discount and accretion of interest.
11
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion and analysis provides information that the
Partnership's management believes is relevant to an assessment and understanding
of the Partnership's results of operations and financial condition. This
discussion should be read in conjunction with the financial statements and
footnotes which appear elsewhere in this report.
This discussion and analysis contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of
the Securities Act of 1933, which are subject to the "safe harbor" created by
that section. Words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," "estimates" and similar expressions or variations of such
works are intended to identify forward-looking statements, but are not the
exclusive means of identifying forward-looking statements in this Report.
Additionally, statements concerning future matters such as the features,
benefits and advantages of the Partnerships properties regarding matters that
are not historical are forward-looking statements. Such statements are subject
to certain risks and uncertainties and the Partnership's actual future results
could differ materially from those projected in the forward-looking statements.
The Partnership assumes no obligation to update the forward-looking statements.
Readers are urged to review and consider carefully the various disclosures made
by the Partnership in this Report, which attempts to advise interested parties
of the risks and factors that may affect the Partnership's business, financial
condition and results of operations.
See restatement and resissuance of financial statements in Note 7 to the
Partnership's consolidated financial statements.
TMP Land Mortgage Fund, Ltd., is a California Limited Partnership formed in
April 1992, of which TMP Investments, Inc., a California corporation, and TMP
Properties, a California general partnership, are the General Partners (the
"General Partners"). The Partnership was formed principally to make short-term
loans to unaffiliated parties secured by first trust deeds on unimproved
properties, primarily in the Inland Empire area of Southern California and in
some instances, in other areas of Southern California, and to provide cash
distributions to the Limited partners, primarily from interest earned on the
mortgage loans. The Partnership is not a mutual fund or any other type of
investment company within the meaning of, and is not subject to regulations
under, the Investment Company Act of 1940.
As of June 30, 1998, 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. As of
June 30, 1998, the following activity occurred on the properties that the
Partnership owns:
12
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations, Continued
PR Equities Loan/San Jacinto #1 and #2
The Partnership foreclosed on the property that secured these loans during 1994
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 $4,400,000. 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
Community Facilities District during the first week of July 1999. 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, and 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 deep discount
and the General Partners believe that the land will ultimately be foreclosed
upon by the new bondholder(s).
Environmental Development Loan
This land was acquired through foreclosure from Environmental Development and
has been developed into a 181-lot subdivision. All entitlements on the property
are complete and a construction loan is considered imminent. Grading should
commence by mid-June 1998.
Peppertree Loan
In satisfaction of its $1.5 million loan to Peppertree, the Partnership received
the $1.5 million principal together with $138,000 in accrued interest and
charges in cash on July 1996, along with a 20% joint venture interest in
Peppertree Park, the property being developed as residential housing. The first
phase of that project has been sold to a prominent homebuilder and the proceeds
were used to pay off the initial development loan. As future phases are sold,
proceeds should be available to the Partnership, which can be distributed to the
limited partners. It is expected that approximately $500,000 will ultimately be
received from this joint venture.
13
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations, Continued
Sunset Crossing
42.48 commercial acres in Banning, California. The Partnership's initial goals
for this property involve the preparation of a new site plan which would allow a
lot-line adjustment in order to sell the corner of the parcel to a gas station
or fast food user, and create new interest for a Wal-Mart or other major
retailer to consider this site. As those efforts achieve results, the property
will be offered for sale. It is not presently intended that the Partnership
would be involved in developing this property.
Fox Olson Loan #2
10.84 commercial acres, Sun City California. Formerly owned by Fox-Olsen, this
property is listed for sale for $1.5 million. TMP has received an offer for $1.2
million and will counter at $1.5 million. It is adjacent to the 45 lots acquired
through foreclosure from Fox-Olsen, which are being developed as a 45-home
sub-division in a joint venture with TMP Homes, LLC. The project is known as
Flowerfield Sun City. The construction loan is in place and grading commenced in
April 1998.
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 the investors began August 1, 1992, and continued monthly
through May 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 Partnership made two distributions from the proceeds of the two
1997 property sales.
Results of Operations
Partnership revenue during the three months period ended June 30, 1998 and 1997
consisted primarily of interest income and joint venture income. During the year
ended December 31, 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.
14
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations, Continued
Liquidity and Capital Resources
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. PacWest has agreed to loan and/or
secure a loan for the six TMP Land Partnerships in the total amount of
$2,500,000. Loan proceeds will be allocated to eleven (11) TMP Land
Partnerships, based on partnership needs, from recommendations made by PacWest,
and under the approval and/or direction of the General Partners. A portion of
these funds will be made available to the Partnership, at 12% simple interest
over a 24 month period beginning April 1, 1998, secured by the Partnership's
properties, as funds are needed in the opinion of the General Partners. These
funds are not to exceed 50% of the 1997 appraised value of the properties, and
will primarily be used to pay or on-going property maintenance, pay down
existing debt, back taxes and appropriate entitlement costs. It is not the
General Partners' intention to use any of the PacWest loans for this
Partnership.
PacWest, at their option, can make additional advances with the agreement of the
General Partners; however, the aggregate amount of cash loaned to all TMP
partnership is limited to a maximum of $2.5 million.
TMP Properties and TMP Investments, Inc. will remain as General Partners,
however, PacWest has acquired the General Partner's unsubordinated 1% interest
in the Partnership and assumed responsibility for all partnership
administration. PacWest will charge a fee for its administrative services equal
to an amount not to exceed the average reimbursements to the general Partner for
such services over the past five years.
As Partnership properties are sold, cash will be used to first repay any PacWest
loans, then other creditors, then to accrued but unpaid Partnership
indebtedness.
Sale proceeds in excess of the amount necessary to pay Partnership indebtedness
shall be split as follows:
<TABLE>
<CAPTION>
PacWest Property Partnership
<S> <C> <C>
3% FlowerField, 97%
Remmington
and Peppertree
13% San Jacinto, 87%
Sun City and
Sunset Crossing
</TABLE>
15
<PAGE>
TMP Land Mortgage Fund, LTD.
A California Limited Partnership
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations, Continued
Year 2000 Compliance
Many currently installed computer systems and software products are coded to
accept only two digit entries in the date code field. Beginning in the year
2000, these date codes fields will need to accept four digit entries to
distinguish 21st century dates from 20th century dates. As a result, computer
systems and/or software used by organizations may need to upgraded to comply
with the "Y2K" requirements. There is significant uncertainty in the software
and information services industries concerning the potential effects associated
with such compliance. While the Partnership believes that its systems are
compatible with Y2K applications, there can be no assurance that all Partnership
systems will function properly in all operating environments and on all
platforms. The failure to comply with Y2K requirements by systems not designed
by the Partnership may also have a material adverse on the Partnership's
business, financial condition and results of operations. The Partnership is
currently developing and implementing a plan to identify and address potential
difficulties associated with Y2K issues and does not expect to expend any
significant funds as a result of these issues.
16
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
None.
17
<PAGE>
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: JUNE 11, 1999
TMP Land Mortgage Fund, Ltd.
A California Limited Partnership
By: TMP Investments, Inc., as General Partner
By: /S/ WILLIAM O PASSO
-------------------------------------------
William O. Passo, President
By: /S/ ANTHONY W THOMPSON
-------------------------------------------
Anthony W. Thompson, Exec. VP
By: /S/ RICHARD HUTTON JR
-------------------------------------------
Richard Hutton, Jr., Controller
By: TMP Properties, a California General
Partnership as General Partner
By: /S/ WILLIAM O PASSO
-------------------------------------------
William O. Passo, General Partner
By: /S/ ANTHONY W THOMPSON
-------------------------------------------
Anthony W. Thompson, General Partner
By: /S/ SCOTT E MCDANIEL
------------------------------------------
Scott E. McDaniel, General Partner
18
