UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[X] Annual report pursuant toSection 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 (No Fee Required). For the transition from
_________to____________
---------------
COMMISSION FILE NO. 0-19940
TMP INLAND EMPIRE VI, LTD.,
A CALIFORNIA LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
CALIFORNIA 33-0386437
(State or other jurisdiction of (I.R.S. Employer
Identification No.)
incorporation or organization)
801 N. 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)
-------------
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so 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 (1) has 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 X No
<PAGE>
Table of Contents
Independent Auditor's Report.................................... 1
Balance Sheet................................................... 2
Statement of Income............................................. 3
Statement of Partners' Capital.................................. 4
Statement of Cash Flows......................................... 5
Notes to FinancialStatements.................................... 6-9
Supplementary Information....................................... 10-12
<PAGE>
Independent Auditor's Report
To the Partners
TMP Inland Empire VI, Ltd.
(A California Limited Partnership)
We have audited the accompanying balance sheet of TMP Inland Empire VI, Ltd. (A
California Limited Partnership) as of December 31, 1997 and the related
statements of income, partners' capital, and cash flows for the year then ended.
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 audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit 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 audit provides 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 Inland Empire VI, Ltd. (A
California Limited Partnership) as of December 31, 1997 and the results of its
operations and its cash flows for the year then ended, in conformity with
generally accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplementary information contained in Schedule
I 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.
Balser, Horowitz, Frank & Wakeling
BALSER, HOROWITZ, FRANK & WAKELING
An Accountancy Corporation
Santa Ana, California January 26, 1998 except for Note 6, as to which the date
is August 3, 1998
<PAGE>
<TABLE>
<CAPTION>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Balance Sheet
December 31, 1997
Assets
1997
<S> <C>
Cash $ 126,159
Prepaid interest 43,495
Investment in unimproved land,
at lower of cost or fair value 7,993,186
----------
Total assets $ 8,162,840
=============
Liabilities and Partners' Capital
---------------------------------
Due to affiliates $ 956
Property tax payable 39,151
Franchise tax payable 800
Notes payable 360,000
--------
Total liabilities 400,907
--------
Partners' capital (deficit)
General partners (25,064)
Limited partners; 11,500 equity
units authorized and outstanding 7,786,997
---------
Total partners' capital 7,761,933
---------
Total liabilities and partners' capital $8,162,840
==========
</TABLE>
See Accompanying Notes and Independent Auditor's Report
<PAGE>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Statement of Income
For the Year Ended December 31, 1997
1997
----
Income
- ------
Interest income $ 3,018
Other income 456
-------------
Total income 3,474
Expenses
- --------
Accounting 6,224
General partner fees 19,774
Expense reimbursements 17,933
------------
Total expenses 43,931
------------
Income or (loss) before income taxes (40,457)
State franchise tax 800
------------
Net income or (loss) $ (41,257)
=============
Allocation of net income or (loss):
General partners, in the aggregate $ (413)
=============
Limited partners, in the aggregate $ (40,844)
=============
Limited partners, per equity unit
$ (3.55)
==============
See Accompanying Notes and Independent Auditor's Report
<PAGE>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Statement of Partners' Capital
For the Year Ended December 31, 1997
<TABLE>
<CAPTION>
General Limited
Partners Partners Total
<S> <C> <C> <C>
Partners' capital (deficit),
December 31, 1996 (24,651) 7,827,841 7,803,190
Net (loss) for 1997 (413) (40,844) (41,257)
----------- ---------- ----------
Partners' capital (deficit),
December 31, 1997 $ (25,064) $7,786,997 $7,761,933
========= ========= =========
</TABLE>
See Accompanying Notes and Independent Auditor's Report
<PAGE>
<TABLE>
<CAPTION>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Statement of Cash Flows
For the Year Ended December 31, 1997
<S> <C>
1997
Cash flow from operating activities
Net income or (loss) $ (41,257)
Adjustments to reconcile net income or
(loss) to net cash used in operating activities:
Increase in carrying costs (106,632)
Increase or (decrease) in due to affiliates 387
Increase in prepaid interest (43,495)
Increase or (decrease) in property tax payable 39,151
Increase or (decrease) in deferred income (456)
----------
Net cash (used in) operating activities (152,302)
-----------
Cash flows from investing activities
Land acquisition and development costs (386,554)
Note receivable principal reduction 223,516
--------
Net cash provided by (used in) investing activities (163,038)
--------
Cash flow from financing activities
Borrowings through notes payable 410,000
Reduction in note payable (50,000)
-------
Net cash provided by (used in)
financing activities 360,000
-------
Net increase or (decrease) in cash 44,660
Cash, beginning of year 81,499
Cash, end of year $126,159
=========
Supplemental disclosures of cash flow information
Income taxes paid $ 800
========
Interest paid $ 84,469
========
</TABLE>
Other Disclosures
The Partnership did not enter into any non-cash investing or financing
activities during the year ended December 31, 1997. During the year ended
December 31, 1997 land was acquired on a note foreclosure for $223,516.
See Accompanying Notes and Independent Auditor's Report
<PAGE>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 1 - Summary of significant accounting policies
Accounting Method - The Partnership's policy is to prepare its
financial statements on the accrual basis of accounting.
Organization Costs - Organization costs include expenses incurred in
the formation of the Partnership that have been capitalized and are
being amortized over a period of 40 years prior to 1992 and 5 years
beginning in 1992.
Investment in Unimproved Land - Investment in unimproved land is
stated at lower of cost or fair value. All costs associated with the
acquisition of a property are capitalized. Additionally, the
Partnership capitalizes all direct carrying costs (such as interest
expense and property taxes.) These costs are added to the cost of the
properties and are deducted from the sales prices to determine gains
when properties are sold.
Syndication Costs -Syndication costs (such as commissions, printing,
and legal fees) totaling $1,231,617 represent costs incurred to raise
capital and, accordingly, are recorded as a reduction in partners'
capital (see Note 3).
Income Taxes - The entity is treated as a partnership for income tax
purposes and any income or loss is passed through and taxable to the
individual partners. Accordingly, there is no provision for federal
income taxes in the accompanying financial statements. However, the
minimum California Franchise tax due by the Partnership at December
31, 1997 and 1996 is $800.
Cash and Cash Equivalents - For purposes of the statements of cash
flows, the Partnership considers all cash in banks and all highly
liquid investments with a maturity of three months or less to be cash
equivalents.
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 investment are
located in the Inland Empire area of 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.
<PAGE>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 2 - Organization of the Partnership
On March 20, 1990, the Partnership was formed with TMP Properties (A
California General Partnership) and TMP Investments, Inc. (A
California Corporation) as the general partners. The partners of TMP
Properties are William O. Passo, Anthony W. Thompson and Scott E.
McDaniel. William O. Passo and Anthony W. Thompson were the
shareholders of TMP Investments, Inc. until October 1, 1995, when
they sold their shares to TMP Group, Inc. and then became the
shareholders of TMP Group, Inc.
The Partnership originally acquired eleven separate parcels of
unimproved real property in Riverside and San Bernardino Counties,
California. The properties are to be held for investment,
appreciation, and ultimate sale and/or improvement of all or a
portion thereof, either alone or in conjunction with a joint venture
partner. During 1995, the Partnership sold one parcel and a portion
of another parcel.
The partnership agreement provides for two types of investments:
Individual Retirement Accounts (IRA) and others. The IRA minimum
purchase requirement was $2,000 and all others were a minimum
purchase requirement of $5,000. The maximum liability of the limited
partners is the amount of their capital contribution.
Note 3 -Partners' contributions
The Partnership offered for sale 11,500 units at $1,000 each to
qualified investors. As of December 31, 1990, all 11,500 units had
been sold for total limited partner contributions of $11,500,000.
There have been no contributions made by the general partners. As
described in Note 1, syndication costs have been recorded as a
reduction in partners' capital.
Note 4 - Allocation of profits, losses and cash distributions
Profits, losses and cash distributions are allocated 99% to the
limited partners and 1% to the general partners until the limited
partners have received an amount equal to their capital contributions
plus a cumulative, non-compounded return of 6% per annum on their
adjusted capital contributions. At that point, the limited partners
are allocated 83.5% and the general partners 16.5% of profits, losses
and cash distributions. There were no distributions in 1997.
<PAGE>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 5 - Related party transactions
Syndication costs (see Note 1) netted against partners' capital
contributions include $1,150,000 in selling commissions paid in prior
years to TMP Capital Corp. for the sale of partnership units of which
a portion was then paid to unrelated registered representatives.
William O. Passo and Anthony W. Thompson were the shareholders of TMP
Capital Corp. until October 1, 1995, when they sold their shares to
TMP Group, Inc.
Investment in unimproved land includes acquisition fees of $650,000
paid in prior years to TMP Properties and TMP Investments, Inc., the
general partners, for services rendered in connection with the
acquisition of the properties.
The Partnership paid $19,774 in partnership management fees to the
general partners during the year ended December 31, 1997.
The Partnership was also charged $14,810 during the year ended
December 31, 1997 by the general partner and an affiliated company of
the general partner for office, secretarial and advertising expenses.
At December 31, 1997 the Partnership had a payable of $956 to the
general partner and the affiliated company.
Note 6 - Re-statement and re-issuance of 1997 financial statements
In compliance with Statement of Financial Accounting Standards No. 121
Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of (SFAS 121), the 1996 financial statements
reported an expense for the decline in fair value of unimproved land
of $2,013,087. The 1997 financial statements originally issued with
the auditor's report dated January 28, 1998 reported $1,948,003 of
income due to appreciation in fair value of land. Current
clarification reveals that SFAS 121 does not provide for recording
appreciation in fair value of an asset even in view of previously
recording a decline in value. Therefore, these financial statements
have been re-stated to remove the appreciation in fair value of land.
In addition, certain carrying costs of land that were previously
capitalized have been re-stated as current expenses in the amount of
$43,811.
<PAGE>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Notes to Financial Statements
December 31, 1997
Note 7 - Note payable
The Partnership entered into a loan agreement with an outside party who
provided engineering services for the partnership. The total loan
amount is $110,000. The principal amount is payable in full upon sale
of the land parcels that engineering services were performed on or upon
recordation of the final tract maps for the same parcels and is secured
by those parcels. The loans are guaranteed by the three general
partners of TMP Properties and by TMP Properties.
The Partnership entered into a loan agreement with an outside party by
offering parcels owned by the partnership as collateral. The total loan
amount is $250,000. This note matures in July of 1999.
Note 8 - Contingency
The Partnership entered into a loan agreement with an outside party who
provided engineering services for a land parcel. The loan of $108,408
was secured by a deed of trust and accrued interest at 10% per annum.
The principal amount was payable upon sale of the land. In August 1995,
the Partnership sold the land parcel and the new owner assumed the
loan. However, the loan was guaranteed by the Partnership, the three
general partners of TMP Properties, and TMP Properties, a general
partnership.
<PAGE>
<TABLE>
SUPPLEMENTARY INFORMATION
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1997
<CAPTION>
COSTS CAPITALIZED
SUBSEQUENT Gross
TO ACQUISITION amount
---------------------- at which Estimated
Initial Carrying Carried at Accumulated Date of Date Dep.
Description of Assets Encumbrances Costs Improvements Costs Year-End Depreciation Construction Acquired Life
- --------------------- ------------ ----- ------------ ----- -------- ------------ ------------ -------- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unimproved land -
San Jacinto, CA -0- $ 1,560,977 -0- $181,235 $ 1,742,212 -0- n/a 6/21/90 n/a
Unimproved land -
Rancho Cal., CA -0- 1,744,082 -0- 168,223 1,912,305 -0- n/a 7/12/90 n/a
Unimproved land -
Palm Desert, CA -0- 3,534,200 -0- 371,434 3,905,634 -0- n/a 6/15/90 n/a
Unimproved land -
Perris, CA -0- 171,386 -0- 22,119 193,505 -0- n/a 1/30/90 n/a
Unimproved land -
Perris, CA -0- 246,869 -0- 28,227 275,096 -0- n/a 7/9/90 n/a
Unimproved land -
Perris, CA -0- 159,823 -0- 12,490 172,313 -0- n/a 4/16/90 n/a
Unimproved land -
Perris, CA -0- 237,466 -0- 24,788 262,254 -0- n/a 10/31/90 n/a
Unimproved land -
Elsinore, CA -0- 442,302 177 46,792 489,271 -0- n/a 9/19/90 n/a
Unimproved land -
Elsinore, CA -0- 97,000 4,580 9,831 111,411 -0- n/a 8/31/90 n/a
Unimproved land -
Adelanto, CA -0- 386,554 -0- 15,641 402,195 -0- n/a 7/23/97 n/a
Unimproved land -
Adelanto, CA -0- 477,783 -0- 62,294 540,077 -0- n/a 5/25/90 n/a
--- ----------- ----- -------- --------- ---
-0- $ 9,058,442 $4,757 $943,074 $10,006,273 -0-
=== =========== ===== ======== ========== ===
Reconciliation of carrying amount
Beginning balance $ 9,513,087
Additions
Initial costs $386,554
Carrying costs 106,632
-------
Total additions 493,186
-------
10,006,273
Allowance for decline in fair
value of unimproved land (2,013,087)
Ending balance $ 7,993,186
See Accompanying Notes and Independent Auditor's Report
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1996
COSTS CAPITALIZED
SUBSEQUENT Gross
TO ACQUISITION amount
---------------------- at which Estimated
Initial Carrying Carried at Accumulated Date of Date Dep.
Description of Assets Encumbrances Costs Improvements Costs Year-End Depreciation Construction Acquired Life
- --------------------- ------------ ----- ------------ ----- ---------- ------------ ------------ -------- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unimproved land -
San Jacinto, CA -0- $1,560,977 -0- $163,819 $1,724,796 -0- n/a 6/21/90 n/a
Unimproved land -
Rancho Cal., CA -0- 1,744,082 -0- 151,235 1,895,317 -0- n/a 7/12/90 n/a
Unimproved land -
Palm Desert, CA -0- 3,534,200 -0- 333,862 3,868,062 -0- n/a 6/15/90 n/a
Unimproved land -
Perris, CA -0- 171,386 -0- 19,614 191,000 -0- n/a 1/30/90 n/a
Unimproved land -
Perris, CA -0- 246,869 -0- 25,546 272,415 -0- n/a 7/9/90 n/a
Unimproved land -
Perris, CA -0- 159,823 -0- 11,858 171,681 -0- n/a 4/16/90 n/a
Unimproved land -
Perris, CA -0- 237,466 -0- 22,577 260,043 -0- n/a 10/31/90 n/a
Unimproved land -
Elsinore, CA -0- 442,302 177 43,217 485,696 -0- n/a 9/19/90 n/a
Unimproved land -
Elsinore, CA -0- 97,000 4,580 8,907 110,487 -0- n/a 8/31/90 n/a
Unimproved land -
Adelanto, CA -0- 477,783 -0- 55,807 533,590 -0- n/a 5/25/90 n/a
--- ---------- ------ ------- ----------- ---
-0- $8,671,888 $4,757 $836,442 $9,513,087 -0-
=== ========= ===== ======= ========= ===
Reconciliation of carrying amount
Beginning balance $9,427,903
Additions
Initial costs $ 0
Carrying costs 85,184
------
Total additions 85,184
----------
9,513,087
Allowance for decline in fair
value of unimproved land (2,013,087)
----------
Ending balance $7,500,000
==========
See Accompanying Notes and Independent Auditor's Report
TMP INLAND EMPIRE VI, LTD.
(A California Limited Partnership)
Schedule I - Real Estate and Accumulated Depreciation
(Schedule XI, Rule 12-28, For SEC Reporting Purposes)
For the Year Ended December 31, 1995
COSTS CAPITALIZED
SUBSEQUENT Gross
TO ACQUISITION amount
---------------------- at which Estimated
Initial Carrying Carried at Accumulated Date of Date Dep.
Description of Assets Encumbrances Costs Improvements Costs Year-End Depreciation Construction Acquired Life
- --------------------- ------------ ----- ------------ ----- ---------- ------------ ------------ -------- ------
S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Unimproved land -
San Jacinto, CA -0- $1,560,977 -0- $155,501 $1,716,478 -0- n/a 6/21/90 n/a
Unimproved land -
Rancho Cal., CA -0- 1,744,082 -0- 132,684 1,876,766 -0- n/a 7/12/90 n/a
Unimproved land -
Palm Desert, CA -0- 3,534,200 -0- 294,142 3,828,342 -0- n/a 6/15/90 n/a
Unimproved land -
Perris, CA -0- 171,386 -0- 17,503 188,889 -0- n/a 1/30/90 n/a
Unimproved land -
Perris, CA -0- 246,869 -0- 22,227 269,096 -0- n/a 7/9/90 n/a
Unimproved land -
Perris, CA -0- 159,823 -0- 10,432 170,255 -0- n/a 4/16/90 n/a
Unimproved land -
Perris, CA -0- 237,466 -0- 20,398 257,864 -0- n/a 10/31/90 n/a
Unimproved land -
Elsinore, CA -0- 442,302 177 39,988 482,467 -0- n/a 9/19/90 n/a
Unimproved land -
Elsinore, CA -0- 97,000 4,580 8,295 109,875 -0- n/a 8/31/90 n/a
Unimproved land -
Adelanto, CA -0- 477,783 -0- 50,088 527,871 -0- n/a 5/25/90 n/a
--- ---------- ------ ------- --------- ---
-0- $8,671,888 $4,757 $751,258 $9,427,903 -0-
=== ========= ===== ======= ========= ===
Reconciliation of carrying amount
Beginning balance $10,754,365
Additions
Improvements $ 177
Carrying costs 181,457
-------
Total additions 181,634
-------
Deductions
Initial costs 1,331,996
Improvements 220
Carrying costs 175,880
---------
Total deductions 1,508,096
---------
Ending balance $ 9,427,903
==========
See Accompanying Notes and Independent Auditor's Report
</TABLE>
<PAGE>
