<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) DECEMBER 1, 1997
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
------------------------------------------------------
(Exact name of registrant as specified in its charter)
MARYLAND 1-13232 84-1259577
- ------------------------------- ------------ -------------------
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
1873 SOUTH BELLAIRE STREET, SUITE 1700, DENVER, CO 80222-4348
- -------------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (303) 757-8101
NOT APPLICABLE
-------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 2. ACQUISITION OR DISPOSITION OF ASSETS
On December 1, 1997, AIMCO Properties, L.P. ("Properties"), a
Delaware limited partnership and a subsidiary limited partnership of
Apartment Investment and Management Company, a Maryland corporation (the
"Company"), purchased the property known as Foxchase Apartments ("Foxchase")
from First Alexandria Associates Limited Partnership, a Virginia limited
partnership ("First Alexandria"). Foxchase is a 2,113 unit apartment complex
located at 4447 Duke Street, Alexandria, Virginia. The purchase price for
Foxchase (the "Purchase Price") was approximately $110.3 million of which
approximately $70.0 million was mortgage debt on Foxchase which was assumed
by Properties and the remainder of the Purchase Price (after deducting
closing costs and a 10% sales commission payable to the general partner
pursuant to the purchase agreements executed in the original syndication of
First Alexandria limited partnership units) was paid in units of limited
partnership interest in Properties ("OP Units").
The Purchase Price was determined based on an independent Member
Appraisal Institute appraisal (the "Appraisal") of Foxchase. The appraiser
calculated the estimated value of Foxchase using the cost approach, direct sales
comparison approach and the income approach. The cost approach resulted in an
estimated market value of $105.4 million; the direct sales comparison approach
resulted in an estimated market value of $117.0 million; and the income
approach, the approach used most often in commercial transactions, resulting in
an estimated market value of $110.0 million. The appraiser concluded that the
market value of Foxchase was $110.0 million.
First Alexandria is a limited partnership formed for the purpose of
purchasing and developing Foxchase. The National Housing Partnership, a
District of Columbia limited partnership ("NHP-LP"), is the General Partner of
First Alexandria. On June 3, 1997, the Company acquired NHP Partners, Inc., a
Delaware corporation ("NHP Partners"), which was formerly affiliated with NHP
Incorporated, a Delaware corporation ("NHP"). NHP Partners directly and
indirectly owned interests in various partnerships, including First Alexandria,
which are managed by NHP. As a result of this acquisition, NHP Partners became
a subsidiary of the Company and NHP-LP became an affiliate of Properties.
Previously, on May 5, 1997, the Company acquired 51.3% of the outstanding common
stock of NHP, which managed Foxchase.
On August 12, 1997, Properties commenced a tender offer for any and
all outstanding units of limited partnership of First Alexandria. By
mid-November 1997, limited partners holding approximately 53.17% of the
limited partner interests tendered their units; such interests were purchased
for cash and OP Units valued at approximately $18.27 million in the
aggregate. Following consummation of the tender offer, NHP-LP (as general
partner) and Properties (as majority limited partner) caused First Alexandria
to sell Foxchase to Properties as of December 1, 1997.
1
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Subsequently, on December 8, 1997, the Company acquired the remaining
48.7% of the outstanding common stock of NHP in a merger transaction and thus
NHP is currently a wholly-owned subsidiary of the Company.
Item 5. OTHER EVENTS
As a result of a tender offer commenced on June 27, 1997 and
continuing through mid-November 1997, Properties acquired approximately
53.95% of the limited partner interests in Country Lakes Associates Two
("Country Lakes"). Country Lakes is a limited partnership formed to purchase
the multi-family housing project known as The Greens of Naperville,
Naperville, Illinois. The units of limited partnership interest were
purchased for cash and OP Units valued at approximately $521,000 in the
aggregate. Properties used cash on hand to fund the cash portion of the
purchase price. A subsidiary of NHP Partners is the general partner of
Country Lakes and thus a subsidiary of the Company and an affiliate of
Properties.
As a result of a tender offer commenced on June 30, 1997 and
continuing through mid-November 1997, Properties acquired approximately
61.88% of the limited partner interests in Point West Limited Partnership
("Point West"). Point West is a limited partnership formed to purchase the
multi-family housing project known as Point West Apartments, Lenexa, Kansas.
The units of limited partnership interest were purchased for cash and OP
Units valued at approximately $379,000 in the aggregate. Properties used
cash on hand to fund the cash portion of the purchase price. A subsidiary of
NHP Partners is the general partner of Point West and thus a subsidiary of
the Company and an affiliate of Properties.
As a result of a tender offer commenced on June 30, 1997 and
continuing through mid-November 1997, Properties acquired approximately
72.05% of the limited partner interests in The Oak Park Partnership ("Oak
Park"). Oak Park is a limited partnership formed to purchase the multi-family
housing project known as 100 Forest Place Apartments, Oak Park, Illinois.
The units of limited partnership interest were purchased for cash and OP
Units valued at approximately $3.35 million in the aggregate. Properties
used cash on hand to fund the cash portion of the purchase price. A
subsidiary of NHP Partners is the general partner of Oak Park and thus a
subsidiary of the Company and an affiliate of Properties.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Businesses Acquired
Financial Statement and Independent Auditors' Report for First
Alexandria Associates Limited Partnership, for the Years Ended December 31,
1996, 1995 and 1994 (included as Exhibit 99.3 to this Report and incorporated
herein by this reference).
2
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Financial Statement and Independent Auditors' Report for Country
Lakes Associates Two, for the Years Ended December 31, 1996, 1995 and 1994
(included as Exhibit 99.4 to this Report and incorporated herein by this
reference).
Financial Statement and Independent Auditors' Report for Point West
Limited Partnership, for the Years Ended December 31, 1996, 1995 and 1994
(included as Exhibit 99.5 to this Report).
Statements of Revenues and Certain Expenses for The Oak Park
Partnership, for the Years Ended December 31, 1996, 1995 and 1994 (included
as Exhibit 99.6 to this Report and incorporated herein by this reference).
(b) Pro Forma Financial Information
The required pro forma financial information is included as Exhibit
99.2 to this Report and incorporated herein by this reference.
(c) Exhibits
The following exhibits are filed with this report:
Exhibit
Number Description
- ------- -----------
12.1 Calculation of Ratio of Earnings to Fixed Charges.
12.2 Calculation of Earnings to Combined Fixed Charges and Preferred
Stock Dividends.
23.1 Consent of Reznick Fedder & Silverman.
23.2 Consent of Deloitte & Touche LLP.
23.3 Consent of Warady & Davis LLP.
99.1 Acquisition and Contribution Agreement and Joint Escrow Instructions,
dated December 1, 1997, by and between AIMCO Properties, L.P., as
Transferee, and First Alexandria Associates Limited Partnership, as
Transferor.
99.2 Pro Forma Financial Information of Apartment Investment and Management
Company.
3
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99.3 Financial Statement and Independent Auditors' Report for First
Alexandria Associates Limited Partnership, for the Years Ended
December 31, 1996, 1995 and 1994.
99.4 Financial Statement and Independent Auditors' Report for Country Lakes
Associates Two, for the Years Ended December 31, 1996, 1995 and 1994.
99.5 Financial Statement and Independent Auditors' Report for Point West
Limited Partnership, for the Years Ended December 31, 1996, 1995 and
1994.
99.6 Statements of Revenues and Certain Expenses for The Oak Park
Partnership, for the Years Ended December 31, 1996, 1995 and 1994.
* * * * *
4
<PAGE>
SIGNATURE
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.
APARTMENT INVESTMENT AND
MANAGEMENT COMPANY
Date: December 15, 1997 By:
------------------------------------
Troy D. Butts
Senior Vice President and Chief
Financial Officer
5
<PAGE>
EXHIBIT INDEX TO CURRENT REPORT ON FORM 8-K
Exhibit
Number Description
- ------- -----------
12.1 Calculation of Ratio of Earnings to Fixed Charges.
12.2 Calculation of Earnings to Combined Fixed Charges and Preferred
Stock Dividends.
23.1 Consent of Reznick Fedder & Silverman.
23.2 Consent of Deloitte & Touche LLP.
23.3 Consent of Warady & Davis LLP.
99.1 Acquisition and Contribution Agreement and Joint Escrow Instructions,
dated December 1, 1997, by and between AIMCO Properties, L.P., as
Transferee, and First Alexandria Associates Limited Partnership, as
Transferor.
99.2 Pro Forma Financial Information of Apartment Investment and Management
Company.
99.3 Financial Statement and Independent Auditors' Report for First
Alexandria Associates Limited Partnership, for the Years Ended
December 31, 1996, 1995 and 1994.
99.4 Financial Statement and Independent Auditors' Report for Country Lakes
Associates Two, for the Years Ended December 31, 1996, 1995 and 1994.
99.5 Financial Statement and Independent Auditors' Report for Point West
Limited Partnership, for the Years Ended December 31, 1996, 1995 and
1994.
99.6 Statements of Revenues and Certain Expenses for The Oak Park
Partnership, for the Years Ended December 31, 1996, 1995 and 1994.
<PAGE>
EXHIBIT 12.1
CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN THOUSANDS)
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
<TABLE>
<CAPTION>
PRO FORMA
NINE MONTHS ----------------------------
ENDED YEAR ENDED DECEMBER JANUARY 10, 1994 NINE MONTHS
SEPTEMBER 30, 31, (INCEPTION) ENDED YEAR ENDED
-------------------- -------------------- THROUGH SEPTEMBER 30, DECEMBER 31,
1997 1996 1996 1995 DECEMBER 31, 1994 1997 1996
--------- --------- --------- --------- ----------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Historical:
Income before gain on
disposition of property,
extraordinary item and
minority interests........ $ 20,649 $ 11,132 $ 15,740 $ 14,988 $ 7,702 $ 37,626 $ 33,469
Fixed charges:
Interest expense.......... 33,359 16,775 24,802 13,322 1,576 34,941 43,210
Capitalized interest...... 751 616 821 113 29 751 821
--------- --------- --------- --------- ------- ------------- -------------
Total fixed charges
(A)................... 34,110 17,391 25,623 13,435 1,605 35,692 44,031
--------- --------- --------- --------- ------- ------------- -------------
Earnings before fixed
charges (1)(B)............ $ 54,008 $ 27,907 $ 40,542 $ 28,310 $ 9,278 $ 72,567 $ 76,679
--------- --------- --------- --------- ------- ------------- -------------
--------- --------- --------- --------- ------- ------------- -------------
Ratio of earnings to fixed
charges (B divided by A)..... 1.6:1.0 1.6:1.0 1.6:1.0 2.1:1.0 5.8:1.0 2.0:1.0 1.7:1.0
--------- --------- --------- --------- ------- ------------- -------------
--------- --------- --------- --------- ------- ------------- -------------
</TABLE>
AIMCO PREDECESSORS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER
JANUARY 1, 1994 31,
THROUGH --------------------
JULY 28, 1994 1993 1992
--------------- --------- ---------
<S> <C> <C> <C>
Historical:
Income (loss) before extraordinary item and income taxes................. $ (1,463) $ 627 $ 54
Fixed charges:
Interest expense....................................................... 4,214 3,510 2,741
Capitalized interest................................................... 0 0 0
------ --------- ---------
Total fixed charges (A).............................................. 4,214 3,510 2,741
------ --------- ---------
Earnings before fixed charges (1)(B)..................................... $ 2,751 $ 4,137 $ 2,795
------ --------- ---------
------ --------- ---------
Ratio of earnings to fixed charges (B divided by A)........................ (2) 1.2:1.0 1.0:1.0
------ --------- ---------
------ --------- ---------
</TABLE>
- ---------
(1) Earnings before fixed charges excludes capitalized interest.
(2) Earnings for the period January 1, 1994 through July 28, 1994 were
inadequate to cover fixed charges. The deficiency for the period was $1,463.
<PAGE>
EXHIBIT 12.2
CALCULATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
(DOLLARS IN THOUSANDS)
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
<TABLE>
<CAPTION>
PRO FORMA
NINE MONTHS ----------------------------
ENDED YEAR ENDED DECEMBER JANUARY 10, 1994 NINE MONTHS
SEPTEMBER 30, 31, (INCEPTION) ENDED YEAR ENDED
-------------------- -------------------- THROUGH SEPTEMBER 30, DECEMBER 31,
1997 1996 1996 1995 DECEMBER 31, 1994 1997 1996
--------- --------- --------- --------- ------------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Historical:
Income before gain on
disposition of property,
extraordinary item and
minority interests........ $ 20,649 $ 11,132 $ 15,740 $ 14,988 $ 7,702 $ 37,626 $ 33,469
Fixed charges:
Interest expense.......... 33,359 16,775 24,802 13,322 1,576 34,941 43,210
Capitalized interest...... 751 616 821 113 29 751 821
Preferred stock
dividends............... 846 0 0 5,169 3,114 4,008 5,344
--------- --------- --------- --------- ------ ------------- -------------
Total fixed charges
(A)................... 34,956 17,391 25,623 18,604 4,719 39,700 49,375
--------- --------- --------- --------- ------ ------------- -------------
Earnings before fixed
charges (1)(B)............ $ 54,008 $ 27,907 $ 40,542 $ 28,310 $ 9,278 $ 72,567 $ 76,679
--------- --------- --------- --------- ------ ------------- -------------
--------- --------- --------- --------- ------ ------------- -------------
Ratio of earnings to combined
fixed charges and preferred
stock dividends (B divided by
A)........................... 1.5:1.0 1.6:1.0 1.6:1.0 1.5:1.0 2.0:1.0 1.8:1.0 1.6:1.0
--------- --------- --------- --------- ------ ------------- -------------
--------- --------- --------- --------- ------ ------------- -------------
</TABLE>
AIMCO PREDECESSORS
<TABLE>
<CAPTION>
JANUARY 1, 1994 YEAR ENDED DECEMBER 31,
THROUGH --------------------------
JULY 28, 1994 1993 1992
--------------- ----------- -------------
<S> <C> <C> <C>
Historical:
Income (loss) before extraordinary item and income taxes........... $ (1,463) $ 627 $ 54
Fixed charges:
Interest expense................................................. 4,214 3,510 2,741
Capitalized interest............................................. 0 0 0
Preferred stock dividends (2).................................... 0 0 0
------- ----------- -------------
Total fixed charges (A)........................................ 4,214 3,510 2,741
------- ----------- -------------
------- ----------- -------------
Earnings before fixed charges (1)(B)............................... $ 2,751 $ 4,137 $ 2,795
------- ----------- -------------
------- ----------- -------------
Ratio of earnings to combined fixed charges and preferred stock
dividends (B divided by A).......................................... (3) 1.2:1.0 1.0:1.0
------- ----------- -------------
------- ----------- -------------
</TABLE>
- ---------
(1) Earnings before fixed charges excludes capitalized interest and preferred
stock dividends.
(2) The AIMCO Predecessors did not have any shares of Preferred Stock
outstanding during the period from January 1, 1992 through July 28, 1994.
(3) Earnings for the period January 1, 1994 through July 28, 1994 were
inadequate to cover fixed charges. The deficiency for the period was $1,463.
<PAGE>
Exhibit 23.1
[LETTERHEAD]
CONSENT OF REZNICK FEDDER & SILVERMAN
---------------------
We consent to the incorporation by reference in Registration Statements
on Form S-3 (No. 333-26415, No. 333-98338, No. 333-828, No. 333-4542, No.
333-4546, No. 333-08997, No. 333-17431, No. 333-20755, No. 333-36531 and No.
333-36537), Registration Statement on Form S-4 (No. 333-39357) and
Registration Statements on Form S-8 (No. 333-4550, No. 333-4548, No.
333-14481, No. 333-36803 and No. 333-41719) of Apartment Investment and
Management Company (AIMCO) of our report dated December 11, 1997 with respect
to the Statements of Revenue and Certain Expenses of Country Lakes Associates
Two, A Limited Partnership and First Alexandra Associates, A Limited
Partnership for the years ended December 31, 1996, 1995 and 1994, appearing in
this Current Report of Form 8-K of AIMCO.
/s/ Resnick Fedder & Silverman
-------------------------------
REZNICK FEDDER & SILVERMAN
Bethesda, Maryland
December 15, 1997
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statements on
Form S-3 (No. 333-26415, No. 33-98338, No. 333-828, No. 333-4542, No.
333-4546, No. 333-08997, No. 333-17431, No. 333-20755, No. 333-36531 and No.
333-36537), Registration Statement on Form S-4 (No. 333-39357) and
Registration Statements on Form S-8 (No. 333-4550, No. 333-4548, No.
333-14481, No. 333-36803 and No. 333-41719) of Apartment Investment and
Management Company (AIMCO) of our report dated December 15, 1997 with respect
to the Statements of Revenues and Certain Expenses of Point West Limited
Partnership for the years ended December 31, 1996, 1995 and 1994, appearing
in this Current Report on Form 8-K of AIMCO.
/s/ Deloitte & Touche LLP
McLean, Virginia
December 15, 1997
<PAGE>
EXHIBIT 23.3
[LETTERHEAD]
December 15, 1997
We consent to the incorporation by reference in Registration Statements on
Form S-3 (No. 333-26415, No. 333-98338, No. 333-828, No. 333-4542, No.
333-4546, No. 333-08997, No. 333-17431, No. 333-20755, No. 333-36531 and No.
333-36537), Registration Statement on Form S-4 (No. 333-39357) and
Registration Statements on Form S-8 (No. 333-4550, No. 333-4548, No.
333-14481, No. 333-36803 and No. 333-41719) of Apartment Investment and
Management Company (AIMCO) of our report dated December 11, 1997 with respect
to the Statements of Revenues and Certain Expenses of THE OAK PARK
PARTNERSHIP for the years ended December 31, 1996, 1995 and 1994, appearing
in this Current Report on Form 8-K of AIMCO.
/s/ Warady & Davis LLP
<PAGE>
ACQUISITION AND CONTRIBUTION AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
DATED
DECEMBER 1, 1997
BY AND BETWEEN
AIMCO PROPERTIES, L.P.,
AS TRANSFEREE,
AND
FIRST ALEXANDRIA ASSOCIATES LIMITED PARTNERSHIP,
AS TRANSFEROR
<PAGE>
ACQUISITION AND CONTRIBUTION AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
THIS ACQUISITION AND CONTRIBUTION AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this "AGREEMENT"), is made and entered into as of December 1, 1997
(the "CLOSING DATE"), by and between AIMCO PROPERTIES, L.P., a Delaware limited
partnership ("TRANSFEREE"), and FIRST ALEXANDRIA ASSOCIATES LIMITED PARTNERSHIP,
a Virginia limited partnership ("TRANSFEROR"), for the purpose of setting forth
the agreement of the parties and of instructing Stewart Title Guaranty Company
("ESCROW AGENT") with respect to the transaction contemplated by this Agreement.
R E C I T A L S:
A. Transferor is the owner of an undivided fee simple interest in
the real property located at 766 N. Howard Street, in the City of Alexandria,
County of Fairfax, Commonwealth of Virginia, as more particularly described on
EXHIBIT "A" attached hereto (the "LAND"). The Land, together with the
"Improvements," the balance of the "Real Property," the "Personal Property," and
the "Intangible Property" (each as hereinafter defined), shall be collectively
referred to herein as the "PROPERTY."
B. Transferor and Transferee have, in good faith and at arm's
length, negotiated the terms and conditions of this Agreement, and Transferor
now desires to transfer, contribute and convey the Property to Transferee, and
Transferee now desires to accept such transfer, contribution and conveyance,
upon and subject to the terms and conditions set forth in this Agreement.
A G R E E M E N T:
NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Transferee and Transferor hereby
agree, and instruct Escrow Agent, as follows:
1. TRANSFER, CONTRIBUTION AND CONVEYANCE .
Subject to all of the terms and conditions of this Agreement,
Transferor agrees to transfer, contribute and convey to Transferee, and
Transferee agrees to acquire and accept
<PAGE>
from Transferor, a good and marketable fee simple interest in the Property, upon
the terms and conditions set forth herein.
2. CONTRIBUTION VALUE.
2.1 PAYMENT. The contribution value of the Property (the
"CONTRIBUTION VALUE") shall equal ONE HUNDRED TEN MILLION TWO HUNDRED SEVENTY
THOUSAND TWO HUNDRED SIXTY-EIGHT DOLLARS ($110,270,268.00) less the sum of all
liens, mortgages and encumbrances affecting the Property, subject to adjustment
for prorations and closing costs as hereinafter provided. The Contribution
Value shall be payable at the "Closing" (as hereinafter defined) in the form of
limited partnership units in Transferee (collectively, "OP UNITS"); provided,
however, that a portion of the Contribution Value equal to the sum of all of
Transferor's "Closing Costs" (as herein defined) shall be payable in cash by
wire transfer of federal funds (instead of in the form of OP Units). The number
of OP Units which Transferor shall receive shall be determined by dividing the
Contribution Value (less the sum of all of Transferor's Closing Costs) by the
average trading price of the Class A Common Stock (the "COMMON STOCK") of
Apartment Investment & Management Company, a Maryland corporation, for the ten
(10) "Business Days" (as hereinafter defined) preceding the second (2nd)
Business Day prior to the Closing, which amount shall, for the purposes of this
Section 2.1, be deemed to be the price of the Common Stock.
2.2 ADJUSTMENT FOR PRORATIONS AND CLOSING COSTS. On the Closing
Date, Transferee shall receive as a credit against the Contribution Value an
amount equal to the sum of: (i) all security deposits which were paid by
tenants ("TENANTS") under the "Leases" (as hereinafter defined) to or for the
account of Transferor plus accrued interest, if and to the extent required to be
paid to such Tenants on such security deposits; (ii) expenses and other sums
owed by Transferor to Tenants for work or disputes which occurred prior to the
Closing Date; and (iii) the amount, if any, by which prorated amounts allocated
to Transferor pursuant to Section 5.5 below exceed prorated amounts allocated to
Transferee pursuant to Section 5.5 below.
3. OPENING OF ESCROW.
On the Closing Date, Transferee and Transferor shall cause an escrow
("ESCROW") to be opened with Escrow Agent by delivery to Escrow Agent of a fully
executed copy of this Agreement (the "OPENING OF ESCROW"). This Agreement shall
constitute escrow instructions to the Escrow Agent as well as the agreement of
the parties. Escrow Agent is hereby appointed and designated to act as the
Escrow Agent and instructed to deliver,
2
<PAGE>
pursuant to the terms of this Agreement, the documents and funds to be deposited
into Escrow as herein provided. The parties hereto shall execute such
additional escrow instructions (not inconsistent with this Agreement as
determined by counsel for Transferee and Transferor) as Escrow Agent shall deem
reasonably necessary for its protection, including Escrow Agent's general
provisions (as may be modified by Transferee, Transferor and Escrow Agent). In
the event of any inconsistency between this Agreement and such additional escrow
instructions, the provisions of this Agreement shall govern.
4. DESCRIPTION OF PROPERTY.
4.1 THE IMPROVEMENTS. As used herein, the term "IMPROVEMENTS" shall
mean all buildings, improvements, structures and fixtures now or hereafter
located on or in the Land, including, without limitation, the building located
at 766 N. Howard Street, Alexandria, Virginia, being used for residential
apartments, containing 2113 units, and commonly known as "Foxchase of
Alexandria" and/or "Foxchase Apartments."
4.2 THE REAL PROPERTY. As used herein, the term "REAL PROPERTY"
shall include (i) the Land, (ii) the Improvements, (iii) all apparatus,
equipment and appliances affixed to and used in connection with the operation or
occupancy of the Land and/or any of the Improvements (such as heating, air
conditioning or mechanical systems and facilities used to provide any utility
services, refrigeration, ventilation, waste disposal or other services) and now
or hereafter located on or in the Land or any of the Improvements, and (iv) all
of the rights, privileges and easements appurtenant to or used in connection
with the Land and/or any of the Improvements, including, without limitation, all
minerals, oil, gas and other hydrocarbon substances, all development rights, air
rights, water, water rights and water stock relating to the Land, all strips and
gores, and all of Transferor's right, title and interest in and to any streets,
alleys, easements, rights-of-way, public ways, or other rights appurtenant,
adjacent or connected to the Land.
4.3 THE PERSONAL PROPERTY. As used herein, the term "PERSONAL
PROPERTY" shall mean all of that certain tangible personal property, equipment
and supplies owned by Transferor and situated at the Real Property and used by
Transferor in connection with the use, operation, maintenance or repair of all
or any portion of the Real Property.
4.4 THE INTANGIBLE PROPERTY. As used herein, the term "INTANGIBLE
PROPERTY" shall mean all of that certain intangible property owned by Transferor
and used by Transferor in connection with all or any portion of the Real
Property and/or the Personal Property, including, without limitation, all of
Transferor's right, title and interest in, to and under: (i) all leases,
licenses, tenancies and other occupancy agreements (whether written or oral) now
3
<PAGE>
in effect at the Property (collectively, the "LEASES"); (ii) all contract
rights, books, records, reports, test results, environmental assessments, if
any, as-built plans, specifications and other similar documents and materials
relating to the use, operation, maintenance, repair, construction or fabrication
of all or any portion of the Real Property and/or the Personal Property; (iii)
all rights, if any, in and to the names used by Transferor in operating the
Property, including, without limitation, "Foxchase of Alexandria" and "Foxchase
Apartments;" (iv) all transferable business licenses, architectural, site,
landscaping or other permits, applications, approvals, authorizations and other
entitlements affecting any portion of the Real Property; and (v) all
transferable guarantees, warranties and utility contracts relating to all or any
portion of the Real Property.
5. CLOSING.
5.1 CLOSING DATE. Subject to the provisions of this Agreement, the
Closing shall take place concurrently with the execution of this Agreement. As
used herein, the "CLOSING" shall mean the recordation in the appropriate land
records (the "OFFICIAL RECORDS") of a duly executed and acknowledged special
warranty deed, in the form of EXHIBIT "B" attached hereto (the "DEED"), subject
only to the Permitted Exceptions (as hereinafter defined.
5.2 DELIVERIES BY TRANSFEROR. On the Closing Date, Transferor, at
its sole cost and expense, shall deliver or cause to be delivered into Escrow
the following documents and instruments, each dated as of the Closing Date, in
addition to the other items and payments required by this Agreement to be
delivered by Transferor:
5.2.1 DEED. The original executed and acknowledged Deed
conveying the Real Property to Transferee;
5.2.2 NON-FOREIGN AFFIDAVIT. An original executed non-foreign
affidavit in the form of EXHIBIT "C" attached hereto (the "NON-FOREIGN
AFFIDAVIT");
5.2.3 ASSIGNMENT OF LEASES. Four (4) original executed
counterparts of an assignment of leases and security deposits with respect to
the Property in the form of EXHIBIT "D" attached hereto (the "ASSIGNMENT OF
LEASES");
5.2.4 BILL OF SALE. Four (4) executed originals of a bill of
sale and assignment with respect to the Property in the form of EXHIBIT "E"
attached hereto (the "BILL OF SALE");
4
<PAGE>
5.2.5 INVESTOR QUESTIONNAIRE. An original completed and
executed investor questionnaire in the form of EXHIBIT "F" attached hereto (the
"INVESTOR QUESTIONNAIRE");
5.2.6 ACKNOWLEDGEMENT. Four (4) original executed
counterparts of an acknowledgement in the form of EXHIBIT "G" attached hereto
(the "ACKNOWLEDGEMENT");
5.2.7 PROOF OF AUTHORITY. Such proof of Transferor's
authority and authorization to enter into this Agreement and the transaction
contemplated hereby, and such proof of the power and authority of the
individual(s) executing or delivering any instruments, documents or certificates
on behalf of Transferor to act for and bind Transferor as may be reasonably
required by Transferee or Stewart Title Guaranty Company (in such capacity,
"TITLE COMPANY"); and
5.2.8 OTHER. Such other documents and instruments, signed and
properly acknowledged by Transferor, if appropriate, as may be reasonably
required by Transferee, Title Company, Escrow Agent or otherwise in order to
effectuate the provisions of this Agreement and the Closing of the transaction
contemplated herein (including, without limitation, affidavits reasonably
required by the Title Company in order to facilitate its issuance at the Closing
of an American Land Title Association extended coverage owner's policy of title
insurance ("TRANSFEREE'S TITLE POLICY") for the Real Property in favor of
Transferee, with an effective date not earlier than the Closing Date, with
liability coverage equal to the amount of the Contribution Value, showing fee
title to the Property vested in Transferee or Transferee's nominee, with those
endorsements requested by Transferee, and subject only to those exceptions that
are reasonably acceptable to Transferee (collectively, the "PERMITTED
EXCEPTIONS")).
5.3 DELIVERIES BY TRANSFEREE. On the Closing Date, Transferee, at
its sole cost and expense, shall deliver or cause to be delivered into Escrow
the following documents and instruments, each dated as of the Closing Date, in
addition to the other items and payments required by this Agreement to be
delivered by Transferee:
5.3.1 CONTRIBUTION VALUE AND CLOSING COSTS. One or more
certificates ("CERTIFICATES") representing the OP Units issued pursuant to the
terms of Section 2 hereof, together with cash in an amount equal to the sum of
all Closing Costs;
5.3.2 ASSIGNMENT OF LEASES. Four (4) original executed
counterparts of the Assignment of Leases;
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5.3.3 ACKNOWLEDGEMENT. Four (4) original executed
counterparts of the Acknowledgement;
5.3.4 PROOF OF AUTHORITY. Such proof of Transferee's
authority and authorization to enter into this Agreement and the transaction
contemplated hereby, and such proof of the power and authority of the
individual(s) executing or delivering any instruments, documents or certificates
on behalf of Transferee to act for and bind Transferee as may be reasonably
required by Title Company or Transferor; and
5.3.5 OTHER. Such other documents and instruments signed and
properly acknowledged by Transferee, if appropriate, as may reasonably be
required by Transferor, Title Company, Escrow Agent, or otherwise in order to
effectuate the provisions of this Agreement and the Closing of the transaction
contemplated herein.
5.4 ACTIONS BY ESCROW AGENT. When Transferee and Transferor have
deposited into Escrow the documents and funds required by this Agreement, and
Title Company is irrevocably committed to issue Transferee's Title Policy with
an effective date not earlier than the Closing Date, Escrow Agent shall, in the
order and manner herein below indicated, take the following actions:
5.4.1 FUNDS AND CERTIFICATES. Disburse all funds and deliver
the Certificates deposited with it by Transferee as follows:
5.4.1.1 pursuant to a Closing statement approved by
Transferee and Transferor, retain for Escrow Agent's own account all escrow fees
and costs, disburse to Title Company the fees and expenses incurred in
connection with the issuance of Transferee's Title Policy, and disburse to any
other persons or entities entitled thereto the amount of any other Closing
Costs;
5.4.1.2 deliver the Certificates to Transferor; and
5.4.1.3 disburse to the party who deposited the same
into Escrow any remaining funds in the possession of Escrow Agent after payments
pursuant to Section 5.4.1.1 above have been completed.
5.4.2 RECORDING. Cause the Deed and any other documents which
the parties hereto may mutually direct to be recorded in the Official Records
and obtain conformed copies thereof for distribution to Transferee and
Transferor.
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5.4.3 TITLE POLICY. Cause the Title Company to issue
Transferee's Title Policy to Transferee.
5.4.4 DELIVERY OF DOCUMENTS. Deliver (a) to Transferee and
Transferor each, two (2) originals of all documents deposited into Escrow (other
than the Deed, the Non-Foreign Affidavit, the Investor Questionnaire and the
Certificates) and (b) to Transferee, the Non-Foreign Affidavit and the Investor
Questionnaire.
5.5 PRORATIONS. Rentals, revenues, and other income, if any, from
the Property, taxes, assessments, improvement bonds, service or other contract
fees, equity costs, and other expenses affecting the Property shall be prorated
between Transferee and Transferor as of the Closing Date based on a 365 day
year. For purposes of calculating prorations, Transferee shall be deemed to be
title holder of the Property, and therefore entitled to the income and
responsible for the expenses, after 12:01 a.m. on the Closing Date. Delinquent
rentals as of the Closing Date shall not be prorated, but when paid to
Transferee shall be delivered by Transferee to Transferor, less the costs and
expenses incurred by Transferee in collecting the same (provided that all
current rent has then been paid with respect to such Leases). After the
Closing, Transferor shall have no right to proceed in any manner or make any
claim against any Tenants for rents that were delinquent as of the Closing Date,
except to the extent that any such person no longer occupies any portion of the
Property. All non-delinquent real estate taxes or assessments on the Property
shall be prorated based on the actual current tax bill, but if such tax bill has
not yet been received by Transferor by the Closing Date or if supplemental taxes
are assessed after the Closing for the period prior to the Closing, the parties
shall make any necessary adjustment after the Closing by cash payment to the
party entitled thereto so that Transferor shall have borne all real property
taxes, including all supplemental taxes, allocable to the period prior to the
Closing and Transferee shall bear all real property taxes, including all
supplemental taxes, allocable to the period from and after the Closing. If any
expenses attributable to the Property and allocable to the period prior to the
Closing are discovered or billed after the Closing, the parties shall make any
necessary adjustment after the Closing by cash payment to the party entitled
thereto so that Transferor shall have borne all expenses allocable to the period
prior to the Closing and Transferee shall bear all expenses allocable to the
period from and after the Closing. The provisions of this Section 5.5 shall
survive the Closing.
5.6 CLOSING COSTS. Each party shall pay its own costs and expenses
arising in connection with the Closing (including, without limitation, its own
attorneys' and advisors' fees), except the following costs (the "CLOSING
COSTS"):
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5.6.1 all documentary transfer, stamp, sales and other taxes
related to the transfer of the Property (other than any State Grantor's Taxes),
which shall be paid by Transferee;
5.6.2 all State Grantor's Taxes, which shall be paid by
Transferor;
5.6.3 Escrow Agent's escrow fees and costs, which shall be
paid one-half (1/2) by Transferor and one-half (1/2) by Transferee;
5.6.4 the cost of the "Disposition Fee" (as defined in that
certain Purchase Agreement, executed in 1980, by and among National Corporation
for Housing Partnerships, The National Housing Partnership and certain limited
partners of Transferor), which shall be paid by Transferor;
5.6.5 the cost of Transferee's Title Policy and all
endorsements thereto, which shall be paid by Transferee; and
5.6.6 all recording fees, which shall be paid by Transferor.
5.7 DELIVERIES OUTSIDE OF ESCROW. Transferor shall deliver
possession of the Property, subject only to the Permitted Exceptions, to
Transferee upon the Closing. Further, Transferor hereby covenants and agrees to
deliver to Transferee, at the Closing, the following items:
5.7.1 INTANGIBLE PROPERTY. The Intangible Property,
including, without limitation, the original Leases.
5.7.2 PERSONAL PROPERTY. The Personal Property, including,
without limitation, any and all keys, pass cards, remote controls, security
codes, computer software and other devices relating to access to the
Improvements.
5.7.3 NOTICES.
5.7.3.1 TENANT NOTICE. A letter to all of the
Tenants in form and substance reasonably acceptable to Transferee, duly executed
by Transferor, dated as of the Closing Date and addressed to all of the Tenants,
informing such Tenants of the transfer of the Property and the assignment of the
Leases to Transferee together with an instruction to pay all amounts due under
the Leases following the Closing Date to Transferee.
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5.7.3.2 SERVICE CONTRACT NOTICE. A letter to all of
the vendors of the service contracts for the Property in form and substance
reasonably acceptable to Transferee, duly executed by Transferor, dated as of
the Closing Date and addressed to all of such vendors, informing said vendors of
the assignment of the service contracts to Transferee.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS.
6.1 TRANSFEROR'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
Transferor represents and warrants to and covenants and agrees with Transferee,
as of the Closing Date, as follows:
6.1.1 TITLE. Transferor is the sole legal and equitable owner
of the Property. No other parties claim any right, title or interest in or to
the Property, or any portion thereof, based on any legal or equitable theory.
6.1.2 AUTHORITY, VALIDITY OF AGREEMENTS. Transferor has the
full right, power and authority to execute this Agreement, to convey the
Property to Transferee as provided herein and to carry out its obligations
hereunder. The individual(s) executing this Agreement and the instruments,
documents and agreements to be executed by Transferor in connection herewith
shall be duly authorized, executed and delivered by Transferor and shall be
valid, binding and enforceable obligations of Transferor.
6.1.3 DUE ORGANIZATION; CONSENTS. Transferor is a limited
partnership duly organized, validly existing and in good standing under the laws
of the Commonwealth of Virginia. All requisite action has been taken by
Transferor in connection with entering into this Agreement, and will be taken
prior to the Closing in connection with the execution and delivery of the
instruments referenced herein and the consummation of the transaction
contemplated hereby. No consent of any partner, shareholder, beneficiary,
creditor, investor, judicial or administrative body, governmental authority or
other party is required in connection herewith which has not been, or prior to
the Closing will not be, obtained.
6.1.4 NO CONFLICTS. The execution and delivery of this
Agreement, the consummation of the transaction herein contemplated, and
compliance with the terms of this Agreement will not conflict with, or, with or
without notice or the passage of time or both, result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture, deed of
trust, mortgage, loan agreement, or other document, or instrument or agreement,
oral or written, to which Transferor is a party or by which Transferor or the
Property is bound, or any applicable regulation of any governmental agency, or
any
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judgment, order or decree of any court having jurisdiction over Transferor or
all or any portion of the Property.
6.1.5 FOREIGN INVESTMENT IN REAL PROPERTY TAX ACT. Transferor
is not a foreign person within the meaning of 42 USCS Section 1445(f)(3).
6.1.6 OP UNITS.
6.1.6.1 Transferor is an "Accredited Investor," as
defined in Rule 501 of the General Rules and Regulations promulgated under the
Securities Act of 1933, as amended (the "ACT").
6.1.6.2 Transferor has had access to such financial
and other information, and has been afforded the opportunity to ask questions of
representatives of Transferee, and to receive answers to those questions, as it
has deemed necessary in connection with the acquisition of the OP Units that are
to be acquired pursuant hereto.
6.1.6.3 Transferor (i) acknowledges that the OP Units
that will be acquired pursuant to this Agreement are being acquired in
transactions not involving any public offering within the meaning of the Act,
and that the OP Units have not been registered and may never be registered under
the Act, and (ii) agrees not to offer, sell, transfer or otherwise dispose of
all or any portion of the OP Units in the absence of registration under the Act
unless it delivers to Transferee an opinion of counsel reasonably satisfactory
to Transferee, in form and substance satisfactory to Transferee, to the effect
that the proposed sale, transfer or other disposition may be effected without
registration under the Act and under applicable state securities or blue sky
laws.
6.1.6.4 Transferor acknowledges and agrees that the
OP Units will be in the form of physical certificates and that unless such OP
Units shall have been registered under the Act, the certificates will bear a
legend to the following effect:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF
ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION, UNLESS THE TRANSFEROR DELIVERS TO THE COMPANY
AN OPINION OF COUNSEL OR OTHER EVIDENCE REASONABLY SATISFACTORY TO THE
COMPANY, IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY, TO THE EFFECT
THAT THE PROPOSED
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SALE, TRANSFER OR OTHER DISPOSITION MAY BE EFFECTED WITHOUT REGISTRATION
UNDER THE ACT AND UNDER APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS.
6.1.6.5 Transferor (i) has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risks of an acquisition of the OP Units and is able to bear the
economic risk of a loss of an investment in the OP Units and (ii) is not
acquiring any OP Units with a view to the distribution of the OP Units or any
present intention of offering or selling any of the OP Units in a transaction
that would violate the Act or the securities laws of any state or any other
applicable jurisdiction.
6.1.6.6 With respect to individual or partnership tax
and other economic considerations involved in the transaction contemplated by
this Agreement, including an investment in OP Units, Transferor is not relying
on Transferee (or any agent or representative of Transferee). Transferor has
carefully considered and has, to the extent it believes such discussion
necessary, discussed with its professional legal, tax, accounting and financial
advisors the suitability of an investment in the OP Units for its particular tax
and financial situation and has determined that the OP Units being acquired by
Transferor are a suitable investment for Transferor.
6.1.6.7 No representations or warranties by
Transferor in this Agreement, nor any document, exhibit, statement, certificate
or schedule heretofore or hereinafter furnished to Transferee pursuant hereto,
or in connection with the transaction contemplated hereby, contains or will
contain any untrue statement of a material fact, or omits or will omit to state
any material fact necessary to make the statements or facts contained therein
not misleading.
6.1.7 SURVIVAL. All of the representations, warranties and
agreements of Transferor set forth in this Agreement shall be true upon the
Closing Date and shall survive the delivery of the Deed and the Closing.
6.2 TRANSFEREE'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
Transferee represents and warrants to and covenants and agrees with Transferor,
as of the Closing Date, as follows:
6.2.1 AUTHORITY, VALIDITY OF AGREEMENTS. Transferee has the
full right, power and authority to execute this Agreement, to accept the
Property from Transferor as provided herein and to carry out its obligations
hereunder. The individual(s) executing this Agreement and the instruments,
documents and agreements to be executed by Transferee
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in connection herewith shall be duly authorized, executed and delivered by
Transferee and shall be valid, binding and enforceable obligations of
Transferee.
6.2.2 DUE ORGANIZATION; CONSENTS. Transferee is a limited
partnership duly organized, validly existing and in good standing under the laws
of the State of Delaware. All requisite partnership action has been taken by
Transferee in connection with entering into this Agreement, and will be taken
prior to the Closing in connection with the execution and delivery of the
instruments referenced herein and the consummation of the transaction
contemplated hereby. No consent of any partner, shareholder, beneficiary,
creditor, investor, judicial or administrative body, governmental authority or
other party is required in connection herewith which has not been, or prior to
the Closing will not be, obtained.
6.2.3 NO CONFLICTS. The execution and delivery of this
Agreement, the consummation of the transaction herein contemplated, and
compliance with the terms of this Agreement will not conflict with, or, with or
without notice or the passage of time or both, result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture, deed of
trust, mortgage, loan agreement, or other document, or instrument or agreement,
oral or written, to which Transferee is a party or by which Transferee is bound,
or any applicable regulation of any governmental agency, or any judgment, order
or decree of any court having jurisdiction over Transferee.
6.2.4 SURVIVAL. All of the representations, warranties and
agreements of Transferee set forth in this Agreement shall be true upon the
Closing Date and shall survive the delivery of the Deed and the Closing.
7. BROKERS.
Transferee and Transferor each hereby represent, warrant to and agree
with each other that it has not had, and shall not have, any dealings with any
third party to whom the payment of any broker's fee, finder's fee, commission or
other similar compensation shall or may become due or payable in connection with
the transaction contemplated hereby.
8. MISCELLANEOUS PROVISIONS.
8.1 GOVERNING LAW. This Agreement and the legal relations between
the parties hereto shall be governed by and construed and enforced in accordance
with the laws of the Commonwealth of Virginia, without regard to its principles
of conflicts of law. The parties each hereby irrevocably consent and submit to
the jurisdiction of the courts in the
12
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Commonwealth of Virginia for the purposes of all legal proceedings arising out
of or relating to this Agreement.
8.2 ENTIRE AGREEMENT; MODIFICATIONS; WAIVER.
8.2.1 ENTIRE AGREEMENT. This Agreement, including, without
limitation, the exhibits attached hereto, constitutes the entire agreement
between Transferee and Transferor pertaining to the subject matter hereof and
supersedes all prior agreements, understandings, letters of intent, negotiations
and discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements, express or implied, made to
either party by the other party in connection with the subject matter hereof
except as specifically set forth herein or in the documents delivered pursuant
hereto or in connection herewith.
8.2.2 MODIFICATIONS; WAIVER. No supplement, modification,
waiver or termination of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. No waiver of any provision of this
Agreement shall be deemed or shall constitute a waiver of any other provision
hereof (whether or not similar), nor shall such waiver constitute a continuing
waiver unless otherwise expressly provided.
8.3 NOTICES. All notices, consents, requests, reports, demands or
other communications hereunder (collectively, "NOTICES") shall be in writing and
may be given personally, by registered or certified mail, by telecopy or by
Federal Express (or other reputable overnight delivery service), as follows:
To Transferee: AIMCO Properties, L.P.
1873 South Bellaire Street, 17th Floor
Denver, Colorado 80222-4348
Attention: Mr. Harry Alcock
Telephone: (303) 757-8101
Telecopy: (303) 504-4889
and to: AIMCO Properties, L.P.
28200 Highway 189, Suite F240
Lake Arrowhead, California 92352
Attention: Mr. Peter K. Kompaniez
Telephone: (909) 336-4821
Telecopy: (909) 336-4826
13
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with a copy to: Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue, Suite 3400
Los Angeles, California 90071
Attention: Allan G. Mutchnik, Esq.
Telephone: (213) 687-5391
Telecopy: (213) 687-5600
To Transferor: First Alexandria Associates Limited Partnership
c/o The National Housing Partnership
8065 Leesburg Pike, Suite 400
Vienna, VA 22182-2738
Attention: General Counsel
Telephone: (703) 394-2400
Telecopy: (703) 394-2930
To Escrow Agent: Stewart Title Guaranty Company
1980 Post Oak Boulevard, Suite 610
Houston, Texas 77056
Attention: Ms. Lolly Avant
Telephone: (800) 729-1906
Telecopy: (713) 552-1703
or to such other address or such other person as the addressee party shall have
last designated by notice to the other parties. All Notices shall be deemed to
have been given when received. All Notices given by telecopy shall be followed
by the delivery of a hard copy of such Notice, provided that such Notice shall
be deemed to have been given when received by telecopy.
8.4 EXPENSES. Subject to the provision for payment of Closing Costs
in accordance with Section 5.6 hereof, whether or not the transaction
contemplated by this Agreement shall be consummated, all fees and expenses
incurred by any party hereto in connection with this Agreement shall be borne by
such party.
8.5 ASSIGNMENT.
8.5.1 TRANSFEROR'S RIGHT TO ASSIGN. Transferor shall not have
the right to assign this Agreement or any portion hereof or to delegate any
duties or obligations arising under this Agreement, voluntarily, involuntarily
or by operation of law, without Transferee's prior written consent.
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8.5.2 TRANSFEREE'S RIGHT TO ASSIGN. Transferee shall have the
right, power and authority to assign this Agreement or any portion of this
Agreement or Transferee's rights hereunder or to delegate any duties or
obligations arising under this Agreement, voluntarily, involuntarily or by
operation of law, without Transferor's consent, to any affiliate of Transferee;
provided, however, that no such assignment or delegation shall relieve
Transferee of its obligations or liabilities under this Agreement.
8.6 SEVERABILITY. Any provision or part of this Agreement which is
invalid or unenforceable in any situation in any jurisdiction shall, as to such
situation and such jurisdiction, be ineffective only to the extent of such
invalidity and shall not affect the enforceability of the remaining provisions
hereof or the validity or enforceability of any such provision in any other
situation or in any other jurisdiction.
8.7 SUCCESSORS AND ASSIGNS; THIRD PARTIES. Subject to and without
waiver of the provisions of Section 8.5 hereof, all of the rights, duties,
benefits, liabilities and obligations of the parties shall inure to the benefit
of, and be binding upon, their respective successors and assigns. Except as
specifically set forth or referred to herein, nothing herein expressed or
implied is intended or shall be construed to confer upon or give to any person
or entity, other than the parties hereto and their successors or permitted
assigns, any rights or remedies under or by reason of this Agreement.
8.8 COUNTERPARTS. This Agreement may be executed in as many
counterparts as may be deemed necessary and convenient, and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed an original, but all such counterparts shall constitute one and the
same instrument.
8.9 HEADINGS. The section headings of this Agreement are for
convenience of reference only and shall not be deemed to modify, explain,
restrict, alter or affect the meaning or interpretation of any provision hereof.
8.10 TIME OF THE ESSENCE. Time shall be of the essence with respect
to all matters contemplated by this Agreement.
8.11 FURTHER ASSURANCES. In addition to the actions recited herein
and contemplated to be performed, executed, and/or delivered by Transferor and
Transferee, Transferor and Transferee agree to perform, execute and/or deliver
or cause to be performed, executed and/or delivered at Closing or after Closing
any and all such further acts, instruments, deeds and assurances as may be
reasonably required to consummate the transaction contemplated hereby.
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8.12 NUMBER AND GENDER. Whenever the singular number is used, and
when required by the context, the same includes the plural, and the masculine
gender includes the feminine and neuter genders.
8.13 CONSTRUCTION. This Agreement shall not be construed more
strictly against one party hereto than against any other party hereto merely by
virtue of the fact that it may have been prepared by counsel for one of the
parties.
8.14 EXHIBITS. All exhibits attached hereto are hereby incorporated
by reference as though set out in full herein.
8.15 ATTORNEY'S FEES. In the event that either party hereto brings
an action or proceeding against the other party to enforce or interpret any of
the covenants, conditions, agreements or provisions of this Agreement, the
prevailing party in such action or proceeding shall be entitled to recover all
reasonable costs and expenses of such action or proceeding, including, without
limitation, reasonable attorneys' fees, charges, disbursements and the
reasonable fees and costs of expert witnesses.
8.16 BUSINESS DAYS. As used herein, the term "BUSINESS DAY" shall
mean a day that is not a Saturday, Sunday or legal holiday. In the event that
the date for the performance of any covenant or obligation under this Agreement
shall fall on a Saturday, Sunday or legal holiday, the date for performance
thereof shall be extended to the next Business Day.
8.17 POST-CLOSING ACCESS TO RECORDS. Upon receipt by Transferor of
Transferee's reasonable written request at anytime and from time to time within
a period of three (3) years after the Closing, Transferor shall, at Transferor's
principal place of business, during Transferor's normal business hours, make all
of Transferor's records relating to the Property available to Transferee for
inspection and copying (at Transferee's sole cost and expense).
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
TRANSFEREE:
AIMCO PROPERTIES, L.P.,
a Delaware limited partnership
By: AIMCO-GP, Inc.,
Its: General Partner
By: /s/ Harry Alcock
----------------------
Harry Alcock
Vice President
TRANSFEROR:
FIRST ALEXANDRIA ASSOCIATES
LIMITED PARTNERSHIP,
a Virginia limited partnership
By: THE NATIONAL HOUSING
PARTNERSHIP,
a District of Columbia limited
partnership
Its: General Partner
By: NATIONAL CORPORATION
FOR HOUSING PARTNERSHIPS,
a District of Columbia corporation
Its: General Partner
By: /s/ Tom Toomey
----------------
Tom Toomey
Executive Vice President
Finance and Administration
17
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ESCROW AGENT:
The undersigned Escrow Agent accepts the foregoing Acquisition and Contribution
Agreement and Joint Escrow Instructions and agrees to act as Escrow Agent
thereunder in strict accordance with its terms.
STEWART TITLE GUARANTY COMPANY
By: /s/
------------
Name:
Title:
18
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LIST OF EXHIBITS
EXHIBIT "A" LEGAL DESCRIPTION OF PROPERTY
EXHIBIT "B" FORM OF SPECIAL WARRANTY DEED
EXHIBIT "C" FORM OF NON-FOREIGN AFFIDAVIT
EXHIBIT "D" FORM OF ASSIGNMENT OF LEASES
EXHIBIT "E" FORM OF BILL OF SALE
EXHIBIT "F" FORM OF INVESTOR QUESTIONNAIRE
EXHIBIT "G" ACKNOWLEDGEMENT
<PAGE>
EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
A-1
<PAGE>
EXHIBIT "B"
SPECIAL WARRANTY DEED
THIS SPECIAL WARRANTY DEED is made and entered into as of this ____ day of
___________, 1997, by and between FIRST ALEXANDRIA ASSOCIATES LIMITED
PARTNERSHIP, a Virginia limited partnership, party of the first part, and AIMCO
PROPERTIES, L.P., a Delaware limited partnership, party of the second part.
WITNESSETH:
THAT, for and in consideration of the sum of Ten Dollars ($10.00) and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the said party of the first part does grant and convey, with
Special Warranty, unto the said party of the second part, in fee simple, that
certain land and premises situate in the County of Fairfax, Virginia, all as
more particularly described on EXHIBIT "A" attached hereto and incorporated by
reference as though fully set forth herein.
TOGETHER with the buildings and improvements thereupon erected, made
or being thereon (or to be erected or made thereon), and all of the estate,
right, title, interest and claim, either at law or in equity, or otherwise
however, of the said party of the first part, of, in, to, or out of the said
land and premises and the rights, alleys, ways, waters, privileges,
appurtenances and advantages, to the same belonging or otherwise appertaining
thereto.
TAX MAP NUMBER: 039.00-04-17-0
GRANTEE'S ADDRESS: AIMCO Properties, L.P.
1873 South Bellaire Street, 17th Floor
Denver, Colorado 80222-4348
Attention: Chief Financial Officer
B-1
<PAGE>
TO HAVE AND TO HOLD, the above land and premises unto the said party of the
second part, its successors and assigns forever, in fee simple subject to the
easements, covenants, restrictions, rights of way and other matters of record,
if any, pertaining thereto among the land records of the County of Fairfax,
Virginia.
AND the said party of the first part, covenants that it will warrant
SPECIALLY the property hereby conveyed, and that it will execute such further
assurances thereof as may be requisite.
IN WITNESS WHEREOF, the said First Alexandria Associates Limited
Partnership, party of the first part, has, as of the day and year first above
written, executed this Special Warranty Deed.
FIRST ALEXANDRIA ASSOCIATES
LIMITED PARTNERSHIP,
a Virginia limited partnership
By: THE NATIONAL HOUSING
PARTNERSHIP,
a District of Columbia limited partnership
Its: General Partner
By: NATIONAL CORPORATION
FOR HOUSING PARTNERSHIPS,
a District of Columbia corporation
Its: General Partner
By:
------------------------
Tom Toomey
Executive Vice President
Finance and Administration
B-2
<PAGE>
STATE OF ________________ )
) : ss.
COUNTY OF _______________ )
On the __ day of_______________, 1997 , before me,________________________
_________________________________________________________, personally appeared
______________________________________________________________________________
_____________________________________________________________________________,
/ / personally known to me or proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
- -------------------------
(SEAL)
B-3
<PAGE>
EXHIBIT "C"
NON-FOREIGN AFFIDAVIT
1. Section 1445 of the Internal Revenue Code of 1986, as amended
(the "IRC"), provides that a transferee of a United States real property
interest must withhold tax if the transferor is a foreign person.
2. In order to inform AIMCO Properties, L.P., a Delaware limited
partnership ("TRANSFEREE"), that withholding of tax is not required upon the
disposition by First Alexandria Associates Limited Partnership, a Virginia
limited partnership ("TRANSFEROR"), of the United States real property more
particularly described on EXHIBIT "A" attached hereto and incorporated herein by
reference (the "PROPERTY"), the undersigned Transferor certifies and declares by
means of this certification, the following:
a. Transferor is not a foreign person, foreign corporation, foreign
partnership, foreign trust or foreign estate (as such terms are
defined in the IRC and the Income Tax Regulations).
b. Transferor is a limited partnership.
c. Record title to the Property is in the name of Transferor.
d. Transferor's federal taxpayer identification number is:
-------------------------
e. Transferor's address is:
First Alexandria Associates Limited Partnership
c/o The National Housing Partnership
8065 Leesburg Pike, Suite 400
Vienna, VA 22182-2738
Attention: General Counsel
3. Transferor understands that this certification may be disclosed
to the Internal Revenue Service by Transferee and that any false statement
contained in this certification may be punished by fine, imprisonment or both.
C-1
<PAGE>
Under penalties of perjury, Transferor declares that it has carefully
examined this certification and it is true, correct and complete.
Executed this ___ day of _________, 1997.
TRANSFEROR:
FIRST ALEXANDRIA ASSOCIATES
LIMITED PARTNERSHIP,
a Virginia limited partnership
By: THE NATIONAL HOUSING
PARTNERSHIP,
a District of Columbia limited
partnership
Its: General Partner
By: NATIONAL CORPORATION
FOR HOUSING PARTNERSHIPS,
a District of Columbia corporation
Its: General Partner
By:
--------------------------
Tom Toomey
Executive Vice President
Finance and Administration
C-2
<PAGE>
EXHIBIT "D"
ASSIGNMENT OF LEASES AND SECURITY DEPOSITS
THIS ASSIGNMENT OF LEASES AND SECURITY DEPOSITS ("ASSIGNMENT") is made and
entered into as of the _______ day of ___________, 1997, by and between AIMCO
PROPERTIES, L.P., a Delaware limited partnership ("ASSIGNEE"), and FIRST
ALEXANDRIA ASSOCIATES LIMITED PARTNERSHIP, a Virginia limited partnership
("ASSIGNOR") .
R E C I T A L S
WHEREAS, Assignor, as landlord, has entered into those certain leases
identified on EXHIBIT "A" attached hereto and incorporated herein by reference
(collectively, together with all amendments, modifications, supplements,
restatements and guarantees thereof, the "LEASES"), for certain property located
in the City of Alexandria, County of Fairfax, Commonwealth of Virginia;
WHEREAS, Assignor and Assignee have entered into that certain Acquisition
and Contribution Agreement and Joint Escrow Instructions, dated as of
__________, 1997 (the "ACQUISITION AGREEMENT"); and
WHEREAS, the Acquisition Agreement requires Assignor and Assignee to
execute this Assignment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree
as follows:
A G R E E M E N T
1. ASSIGNMENT AND ASSUMPTION. From and after the date hereof for the
remainder of the term of each of the Leases, Assignor hereby irrevocably
assigns, sets over, transfers and conveys to Assignee all of Assignor's right,
title and interest in and to (i) the Leases and (ii) all security deposits made
under the Leases (the "SECURITY DEPOSITS"). Subject to the terms and conditions
of the Acquisition Agreement, Assignee hereby accepts this Assignment of the
Leases and Security Deposits and the rights granted herein. Assignee hereby
expressly assumes, for itself and its successors, assigns and legal
representatives, the Leases and all of the obligations and liabilities, fixed
and contingent, of Assignor thereunder accruing from and after the date hereof
D-1
<PAGE>
with respect to the Leases (including, without limitation, the obligation to
account for the Security Deposits) and agrees to (a) be fully bound by all of
the terms, covenants, agreements, provisions, conditions, obligations and
liability of Assignor thereunder, which accrue from and after the date hereof,
and (b) keep, perform and observe all of the covenants and conditions contained
therein on the part of Assignor to be kept, performed and observed, from and
after the date hereof.
2. GENERAL PROVISIONS.
a. SUCCESSORS. This Assignment shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, legal
representatives, successors and assigns.
b. COUNTERPARTS. This Assignment may be executed in as many
counterparts as may be deemed necessary and convenient, and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed an original, but all such counterparts shall constitute one and the
same instrument.
c. GOVERNING LAW. This Assignment and the legal relations of the
parties hereto shall be governed by and construed and enforced in accordance
with the laws of the Commonwealth of Virginia, without regard to its principles
of conflicts of law.
D-2
<PAGE>
IN WITNESS WHEREOF, this Assignment was made and executed as of the date
first above written.
ASSIGNEE:
AIMCO PROPERTIES, L.P.,
a Delaware limited partnership,
By: AIMCO-GP, Inc.,
Its: General Partner
By:
-------------------------
Harry Alcock
Vice President
ASSIGNOR:
FIRST ALEXANDRIA ASSOCIATES
LIMITED PARTNERSHIP,
a Virginia limited partnership
By: THE NATIONAL HOUSING
PARTNERSHIP,
a District of Columbia limited
partnership
Its: General Partner
By: NATIONAL CORPORATION
FOR HOUSING PARTNERSHIPS,
a District of Columbia corporation
Its: General Partner
By:
--------------------------
Tom Toomey
Executive Vice President
Finance and Administration
D-3
<PAGE>
EXHIBIT "A"
LIST OF LEASES
D-4
<PAGE>
EXHIBIT "E"
BILL OF SALE AND ASSIGNMENT
THIS BILL OF SALE AND ASSIGNMENT ("BILL OF SALE") is made and entered into
as of the ___ day of ___________, 1997, by FIRST ALEXANDRIA ASSOCIATES LIMITED
PARTNERSHIP, a Virginia limited partnership ("TRANSFEROR"), to and for the
benefit of AIMCO PROPERTIES, L.P., a Delaware limited partnership
("TRANSFEREE").
R E C I T A L S
WHEREAS, Transferor is the owner of that certain parcel of real property
located in the City of Alexandria, County of Fairfax, Commonwealth of Virginia
(the "REAL PROPERTY"), as more particularly described on EXHIBIT "A" attached
hereto and incorporated herein by reference;
WHEREAS, Transferee and Transferor have entered into that certain
Acquisition and Contribution Agreement and Joint Escrow Instructions, dated as
of _________, 1997 (the "ACQUISITION AGREEMENT"), with respect to, among other
things, the acquisition of the "Personal Property" and the "Intangible Property"
(each as defined below), and certain other property; and
WHEREAS, the Acquisition Agreement requires Transferor to convey all of
Transferor's right, title and interest in, to and under the Personal Property
and the Intangible Property to Transferee.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Transferor hereby agrees as
follows:
A G R E E M E N T
1. Unless the context otherwise requires, all capitalized terms used but
not otherwise defined herein shall have the respective meanings provided
therefor in the Acquisition Agreement.
2. Transferor does hereby unconditionally, absolutely, and irrevocably
grant, bargain, sell, transfer, assign, convey, set over and deliver unto
Transferee all of Transferor's right, title and interest in and to:
E-1
<PAGE>
a. all of that certain tangible personal property, equipment and
supplies owned by Transferor and situated at the Real Property and used by
Transferor in connection with the use, operation, maintenance or repair of all
or any portion of the Real Property; and
b. all of that certain intangible property owned by Transferor and
used by Transferor in connection with all or any portion of the Real Property
and/or the Personal Property, including, without limitation, all of Transferor's
right, title and interest in, to and under: (i) all contract rights, books,
records, reports, test results, environmental assessments, if any, as-built
plans, specifications and other similar documents and materials relating to the
use, operation, maintenance, repair, construction or fabrication of all or any
portion of the Real Property or the Personal Property; (ii) all rights, if any,
in and to the names used by Transferor in operating the Property, including,
without limitation, "Foxchase of Alexandria" and "Foxchase Apartments;" (iii)
all transferable business licenses, architectural, site, landscaping or other
permits, applications, approvals, authorizations and other entitlements
affecting any portion of the Real Property; and (iv) all transferable
guarantees, warranties and utility contracts relating to all or any portion of
the Real Property.
3. Transferor represents and warrants that it has good title to the
Property and that the Property is free and clear of all options, claims, liens,
mortgages, pledges, security interests, prior assignments, encumbrances,
covenants, conditions, restrictions and any other matters affecting title, other
than the Permitted Exceptions.
4. This Bill of Sale shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, legal representatives, successors
and assigns.
5. This Bill of Sale and the legal relations of the parties hereto shall
be governed by and construed and enforced in accordance with the laws of the
Commonwealth of Virginia, without regard to its principles of conflicts of law.
E-2
<PAGE>
IN WITNESS WHEREOF, this Bill of Sale was made and executed as of the date
first above written.
TRANSFEROR:
FIRST ALEXANDRIA ASSOCIATES
LIMITED PARTNERSHIP,
a Virginia limited partnership
By: THE NATIONAL HOUSING
PARTNERSHIP,
a District of Columbia limited
partnership
Its: General Partner
By: NATIONAL CORPORATION
FOR HOUSING PARTNERSHIPS,
a District of Columbia corporation
Its: General Partner
By:
------------------------
Tom Toomey
Executive Vice President
E-3
<PAGE>
EXHIBIT "F"
INVESTOR QUESTIONNAIRE
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
INDIVIDUAL INVESTOR QUESTIONNAIRE
To: Apartment Investment and Management Company
The information contained in this Questionnaire is being furnished in order
to determine whether the undersigned meets the suitability standards for an
investment in units of limited partnership (the "Securities") of AIMCO
Properties, L.P., a Delaware limited partnership (the "Company").
ALL INFORMATION CONTAINED IN THIS QUESTIONNAIRE WILL BE TREATED
CONFIDENTIALLY. The undersigned understands, however, that the Company may
present this Questionnaire to such parties as it deems appropriate if called
upon to establish that the proposed offer and sale of the Securities is exempt
from registration under the Securities Act of 1933, as amended, or meets the
requirements of applicable state securities or "blue sky" laws. Further, the
undersigned understands that the Company may be required to report the offering
in public filings with the Securities and Exchange Commission and to various
state securities or "blue sky" regulators.
IN ADDITION TO SIGNING THE SIGNATURE PAGE, YOU MUST COMPLETE A FORM W-9.
- --------------------------------------------------------------------------------
IF YOU ARE PURCHASING SECURITIES WITH YOUR SPOUSE, YOU MUST BOTH SIGN THE
SIGNATURE PAGE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
IF YOU ARE PURCHASING SECURITIES WITH ANOTHER PERSON NOT YOUR SPOUSE, YOU
MUST EACH FILL OUT A SEPARATE QUESTIONNAIRE AND FORM W-9.
- --------------------------------------------------------------------------------
F-11
<PAGE>
I. PLEASE INDICATE DESIRED TYPE OF OWNERSHIP OF SECURITIES.
/ / Individual
/ / Joint Tenants (rights of survivorship)
/ / Tenants in Common (no rights of survivorship)
II. PLEASE CHECK ANY OF THE STATEMENTS 1-6 BELOW THAT APPLIES TO YOU
/ / 1. I have an individual net worth* or joint net worth with my
spouse in excess of $1,000,000.
/ / 2. I have had an individual income* in excess of $200,000 in each of
the two most recent years, and I reasonably expect an individual
income in excess of $200,000 for the current year. NOTE: IF YOU
ARE BUYING JOINTLY WITH YOUR SPOUSE, YOU MUST EACH HAVE AN
INDIVIDUAL INCOME IN EXCESS OF $200,000 IN EACH OF THESE YEARS IN
ORDER TO CHECK THIS BOX.
/ / 3. My spouse and I have had a joint income in excess of $300,000 in
each of the two most recent years, and I reasonably expect a
joint income in excess of $300,000 for the current year.
/ / 4. I am a Massachusetts resident, and my investment in the
Securities does not exceed 25% of my net worth or, if I am
married, 25% of the combined net worth of my spouse and me,
excluding principal residence and home furnishings.
- --------------------
* For purposes of this Questionnaire, the term "net worth" means the excess
of total assets over total liabilities. In determining "income," an
investor should add to his or her adjusted gross income any amounts
attributable to tax-exempt income received, losses claimed as a limited
partner in any limited partnership, deductions claimed for depletion,
contributions to IRA or Keogh retirement plan, alimony payments and any
amount by which income from long-term capital gains has been reduced in
arriving at adjusted gross income.
F-1-2
<PAGE>
/ / 5. I am a resident of Alabama or Wisconsin and, either alone or with
my representative, I have such knowledge and experience in
financial and business matters that I am capable of evaluating
the merits and risks of this investment.
/ / 6. I am a director or executive officer of the Company.
III. OTHER CERTIFICATIONS
By signing the Signature Page, I certify as follows (or, if I am purchasing
Securities with my spouse as co-owner, each of us certifies as follows):
(a) that I am at least 21 years of age;
(b) that my purchase of Securities will be solely for my own account and
not for the account of any other person (other than my spouse, if
co-owner); and
(c) that the name, residence address and social security or taxpayer
identification number, as set forth in this Questionnaire, are true,
correct and complete.
IV. GENERAL INFORMATION.
(a) PURCHASER.
Name:
- --------------------------------------------------------------------------------
Social Security or Taxpayer Identification Number:
- --------------------------------------------------------------------------------
Residence Address:
- --------------------------------------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
F-1-3
<PAGE>
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Residence Telephone Number:
- --------------------------------------------------------------------------------
(Area Code) (Number)
Business Name and Address:
- --------------------------------------------------------------------------------
(Name of Business)
- --------------------------------------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Business Telephone Number:
- --------------------------------------------------------------------------------
(Area Code) (Number)
I prefer to have correspondence sent to: / / Residence / / Business
(b) SPOUSE, IF CO-OWNER.
Name:
- --------------------------------------------------------------------------------
Social Security or Taxpayer Identification Number:
- --------------------------------------------------------------------------------
Residence Address (if different from Purchaser's):
- --------------------------------------------------------------------------------
(Number and Street)
F-1-4
<PAGE>
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Residence Telephone Number (if different from Purchaser's):
- --------------------------------------------------------------------------------
(Area Code) (Number)
Business Name and Address (if different from Purchaser's):
- --------------------------------------------------------------------------------
(Business Name)
- --------------------------------------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Business Telephone Number (if different from Purchaser's):
- --------------------------------------------------------------------------------
(Area Code) (Number)
I prefer to have correspondence sent to: / / Residence / / Business
F-1-5
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
INDIVIDUAL SIGNATURE PAGE
Your signature on this Individual Signature Page evidences your agreement
to be bound by the QUESTIONNAIRE.
The undersigned represents that (a) he or she has read and understands the
Private Placement Memorandum of Apartment Investment and Management Company
relating to Securities, (b) the information contained in this Questionnaire is
complete and accurate and (c) he or she will notify Apartment Investment and
Management Company immediately if any material change in any of this information
occurs before the undersigned acquires Securities and will promptly send written
confirmation of such change.
---------------------------------------------
Date
----------------------------------------
Signature
----------------------------------------
Name (Please Type or Print)
----------------------------------------
Signature of Spouse if Co-Owner
----------------------------------------
Name of Spouse if Co-Owner
(Please Type or Print)
- --------------------------------------------------------------------------------
IF YOU ARE PURCHASING UNITS WITH YOUR SPOUSE, YOU MUST BOTH SIGN THE
SIGNATURE PAGE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
IF YOU ARE PURCHASING UNITS WITH ANOTHER PERSON NOT YOUR SPOUSE, YOU MUST
EACH FILL OUT A SEPARATE QUESTIONNAIRE AND FORM W-9. PLEASE MAKE A PHOTOCOPY OF
THE INDIVIDUAL INVESTOR QUESTIONNAIRE AND RETURN BOTH COMPLETED QUESTIONNAIRES
AND FORMS W-9 TO APARTMENT INVESTMENT AND MANAGEMENT COMPANY IN THE SAME
ENVELOPE.
- --------------------------------------------------------------------------------
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
F-1-6
<PAGE>
TRANSFERRED UNLESS SUCH SECURITIES ARE INCLUDED IN AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR AN OPINION OF COUNSEL, CONCURRED IN BY COUNSEL TO THE
COMPANY, HAS BEEN DELIVERED TO THE EFFECT THAT REGISTRATION OF SUCH SECURITIES
IS NOT REQUIRED.
F-1-7
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PARTNERSHIP QUESTIONNAIRE
To: Apartment Investment and Management Company
The information contained in this Questionnaire is being furnished in order
to determine whether the undersigned meets the suitability standards for an
investment in units of limited partnership (the "Securities") of AIMCO
Properties, L.P., a Delaware limited partnership (the "Company").
ALL INFORMATION CONTAINED IN THIS QUESTIONNAIRE WILL BE TREATED
CONFIDENTIALLY. The undersigned Partnership understands, however, that the
Company may present this Questionnaire to such parties as it deems appropriate
if called upon to establish that the proposed offer and sale of the Securities
is exempt from registration under the Securities Act of 1933, as amended, or
meets the requirements of applicable state securities or "blue sky" laws.
Further, the undersigned Partnership understands that the Company may be
required to report the offering in public filings with the Securities and
Exchange Commission and to various state securities or "blue sky" regulators.
IN ADDITION TO SIGNING THE SIGNATURE PAGE, THE UNDERSIGNED PARTNERSHIP MUST
COMPLETE A FORM W-9.
I. PLEASE CHECK ANY OF THE STATEMENTS 1-3 BELOW THAT APPLIES TO THE
PARTNERSHIP.
/ / 1. The undersigned Partnership: (a) has total assets in excess of
$5,000,000; and (b) was not formed for the specific purpose of
acquiring Securities.
/ / 2. Each of the partners of the undersigned Partnership is able to
certify that such partner meets at least one of the following
four conditions:
(a) the partner is a natural person whose individual net worth*
or joint net worth with his or her spouse is in excess of
$1,000,000; or
- -----------------------
* For purposes of this Questionnaire, the term "net worth" means the excess
of total assets over total liabilities. In determining "income," an
investor should add to his or her adjusted gross income any amounts
attributable to tax-exempt income received, losses claims as a limited
partner in any limited partnership, deductions claimed for depletion,
contributions to IRA or Keogh retirement plan, alimony payments and any
amount by which income from long-term capital gains has been reduced in
arriving at adjusted gross income.
F-2-1
<PAGE>
(b) the partner is a natural person whose individual income* was
in excess of $200,000 in each of the two most recent years,
and who reasonably expects an individual income in excess of
$200,000 in the current year;
(c) Each of the partners of the undersigned Partnership is able
to certify that such partner is a natural person who,
together with his or her spouse, has had a joint income in
excess of $300,000 in each of the two most recent years, and
who reasonably expects a joint income in excess of $300,000
in the current year; or
(d) the partner is a director or executive officer of the
Company.
- --------------------------------------------------------------------------------
IF YOU CHECKED STATEMENT 2 OR STATEMENT 3 IN SECTION I AND DID NOT CHECK
STATEMENT 1, YOU MUST PROVIDE A LETTER SIGNED BY A GENERAL PARTNER OF THE
UNDERSIGNED PARTNERSHIP LISTING THE NAME OF EACH PARTNER (WHETHER A GENERAL OR
LIMITED PARTNER) AND THE REASON (UNDER STATEMENT 2 OR STATEMENT 3) SUCH PARTNER
QUALIFIED AS AN ACCREDITED INVESTOR (ON THE BASIS OF NET WORTH, INDIVIDUAL
INCOME OR JOINT INCOME), OR EACH PARTNER MUST PHOTOCOPY AND COMPLETE SECTION II
BELOW.
- --------------------------------------------------------------------------------
II. IF YOU CHECKED STATEMENT 2 OR STATEMENT 3 IN SECTION I ABOVE, EACH PARTNER
MUST CHECK ANY OF THE STATEMENTS 1-6 BELOW THAT APPLIED TO SUCH PARTNER AND SIGN
WHERE INDICATED.
/ / 1. I have an individual net worth or joint net worth with my spouse
in excess $1,000,000.
/ / 2. I have had an individual income in excess of $200,000 in each of
the two most recent years, and I reasonably expect an individual
income in excess of $200,000 for the current year. NOTE: IF YOUR
PARTNERSHIP INTEREST IS HELD JOINTLY WITH YOUR SPOUSE, YOU MUST
EACH HAVE AN INDIVIDUAL INCOME IN EXCESS OF $200,000 IN EACH OF
THESE YEARS IN ORDER TO CHECK THIS BOX.
/ / 3. My spouse and I have had a joint income in excess of $300,000 in
each of the two most recent years, and I reasonably expect a
joint income in excess of $300,000 for the current year.
F-2-2
<PAGE>
/ / 4. I am a Massachusetts resident, and my investment in the
Securities does not exceed 25% of my net worth or, if I am
married, 25% of the combined net worth of my spouse and me,
excluding principal residence and home furnishings.
/ / 5. I am a resident of Alabama or Wisconsin and, either alone or with
my representative, I have such knowledge and experience in
financial and business matters that I am capable of evaluating
the merits and risks of this investment.
/ / 6. I am a director or executive officer of the Company.
------------------------
Print Name of Partner(s)
------------------------
Signature of Partner(s)
III. OTHER CERTIFICATIONS.
By signing the Signature Page, the undersigned Partnership certifies as
follows:
(a) that the Partnership's purchase of the Securities will be solely for
the Partnership's own account and not for the account of any other person;
and
(b) that the Partnership's name, address of principal place of business,
place of formation and taxpayer identification number as set forth in this
Questionnaire are true, correct and complete.
IV. GENERAL INFORMATION.
(a) PURCHASER.
Name:
---------------------------------------------------------------------------
Principal Place of Business
-----------------------------------------------------
(Number and Street)
F-2-3
<PAGE>
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Address for Correspondence (if different):
- --------------------------------------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Telephone Number:
---------------------------------------------------------------
(Area Code) (Number)
State in which Formed:
----------------------------------------------------------
Date of Formation:
--------------------------------------------------------------
Taxpayer Identification Number:
-------------------------------------------------
Number of Partners:
-------------------------------------------------------------
(b) THE PERSON WHO IS EXECUTING THIS QUESTIONNAIRE ON BEHALF OF THE
PARTNERSHIP.
Name:
---------------------------------------------------------------------------
Position or Title:
--------------------------------------------------------------
(c) IF SECTION II HAS BEEN COMPLETED, NAMES OF INDIVIDUAL PARTNERS WHOSE
SIGNATURES MUST APPEAR ON PAGE B-3.
Name(s) of Individual Partners:
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
F-2-4
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PARTNERSHIP SIGNATURE PAGE
Your signature on this Partnership Signature Page evidences the agreement
by the Partnership to be bound by the Questionnaire.
1. The undersigned Partnership represents that (a) the undersigned has
read and understands the Private Placement Memorandum of Apartment Investment
and Management Company relating to Securities, (b) the information contained in
this Questionnaire is complete and accurate and (c) the Partnership will notify
Apartment Investment and Management Company immediately if any material change
in any of this information occurs before the undersigned Partnership acquires
Securities and will promptly send written confirmation of such change.
2. The undersigned Partnership hereby represents and warrants that the
person signing this Questionnaire on behalf of the Partnership is duly
authorized to acquire the Securities and execute this Questionnaire on behalf of
the Partnership and, further, that the undersigned Partnership has all requisite
authority to purchase Securities and execute this Questionnaire.
---------------------------------------------
Date
---------------------------------------------
Name of Partnership (Please Type or Print)
By:
------------------------------------------
(Signature)
Name:
----------------------------------------
(Please Type or Print)
Title:
---------------------------------------
(Please Type or Print)
F-2-5
<PAGE>
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
UNLESS SUCH SECURITIES ARE INCLUDED IN AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE ACT OR AN OPINION OF COUNSEL, CONCURRED IN BY COUNSEL TO THE COMPANY, HAS
BEEN DELIVERED TO THE EFFECT THAT REGISTRATION OF SUCH SECURITIES IS NOT
REQUIRED.
F-2-6
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CORPORATION QUESTIONNAIRE
To: Apartment Investment and Management Company
The information contained in this Questionnaire is being furnished in order
to determine whether the undersigned meets the suitability standards for an
investment in units of limited partnership (the "Securities") of AIMCO
Properties, L.P., a Delaware limited partnership (the "Company").
ALL INFORMATION CONTAINED IN THIS QUESTIONNAIRE WILL BE TREATED
CONFIDENTIALLY. The undersigned Corporation understands, however, that the
Company may present this Questionnaire to such parties as it deems appropriate
if called upon to establish that the proposed offer and sale of the Securities
is exempt from registration under the Securities Act of 1933, as amended, or
meets the requirements of applicable state securities or "blue sky" laws.
Further, the undersigned Corporation understands that the Company may be
required to report the offering in public filings with the Securities and
Exchange Commission and to various state securities or "blue sky" regulators.
IN ADDITION TO SIGNING THE SIGNATURE PAGE, THE UNDERSIGNED CORPORATION MUST
COMPLETE A FORM W-9.
I. PLEASE CHECK ANY OF THE STATEMENTS 1-3 BELOW THAT APPLIES TO THE
CORPORATION.
/ / 1. The undersigned Corporation: (a) has total assets in excess of
$5,000,000; and (b) was not formed for the specific purpose of
acquiring Securities.
/ / 2. Each of the shareholders of the undersigned Corporation is able
to certify that such shareholder meets at least one of the
following three conditions:
F-3-1
<PAGE>
(a) the shareholder is a natural person whose individual net
worth* or joint net worth with his or her spouse is in
excess of $1,000,000; or
(b) the shareholder is a natural person who had an individual
income* in excess of $200,000 in each of the two most recent
years, and who reasonably expects an individual income in
excess of $200,000 in the current year; or
(c) each of the shareholders of the undersigned Corporation is
able to certify that such shareholder is a natural person
who, together with his or her spouse, has had a joint income
in excess of $300,000 in each of the two most recent years,
and who reasonably expects a joint income in excess of
$300,000 in the current year.
/ / 3. The undersigned Corporation is:
(a) a bank as defined in Section 3(a) (2) of the Securities Act; or
(b) a savings and loan association or other institution as defined in
Section 3(a) (5) (A) of the Securities Act whether acting in its
individual or fiduciary capacity; or
(c) a broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934; or
(d) an insurance company as defined in Section 2(13) of the
Securities Act; or
(e) an investment company registered under the Investment Company Act
of 1940 or a business development company as defined in Section
2(a) (48) of the Investment Company Act of 1940; or
- ------------------
* For purposes of this Questionnaire, the term "net worth" means the excess
of total assets over total liabilities. In determining "income," an
investor should add to his or her adjusted gross income any amounts
attributable to tax-exempt income received, losses claimed as a limited
partner in any limited partnership, deductions claimed for depletion,
contributions to IRA or Keogh retirement plan, alimony payments and any
amount by which income from long-term capital gains has been reduced in
arriving at adjusted gross income.
F-3-2
<PAGE>
(f) a small business investment company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958; or
(g) a private business development as defined in Section 202(a) (22)
of the Investment Advisors Act of 1940.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
IF YOU CHECKED STATEMENT 2 OR STATEMENT 3 IN SECTION I AND DID NOT CHECK
STATEMENT 1, YOU MUST PROVIDE A LETTER SIGNED BY AN OFFICER OF THE UNDERSIGNED
CORPORATION LISTING THE NAME OF EACH SHAREHOLDER AND THE REASON (UNDER STATEMENT
2) WHY SUCH SHAREHOLDER QUALIFIES AS AN ACCREDITED INVESTOR (ON THE BASIS OF NET
WORTH, INDIVIDUAL INCOME OR JOINT INCOME), OR EACH SHAREHOLDER MUST PHOTOCOPY
AND COMPLETE SECTION II BELOW.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
II. IF YOU CHECKED STATEMENT 2 IN I ABOVE, EACH SHAREHOLDER MUST CHECK ANY OF
THE STATEMENTS 1-6 BELOW THAT APPLIES TO SUCH SHAREHOLDER AND SIGN BELOW
WHERE INDICATED.
/ / 1. I have an individual net worth or joint net worth with my spouse
in excess of $1,000,000.
/ / 2. I have had an individual income in excess of $200,000 in each of
the two most recent years, and I reasonably expect an individual
income in excess of $200,000 for the current year. NOTE: IF YOU
HOLD SHARES IN THE UNDERSIGNED CORPORATION JOINTLY WITH YOUR
SPOUSE, YOU MUST EACH HAVE AN INDIVIDUAL INCOME IN EXCESS OF
$200,000 IN EACH OF THESE YEARS IN ORDER TO CHECK THIS BOX.
/ / 3. My spouse and I have had a joint income in excess of $300,000 in
each of the two most recent years, and I reasonably expect a
joint income in excess of $300,000 for the current year.
/ / 4. I am a Massachusetts resident, and my investment in Securities
does not exceed 25% of my net worth or, if I am married, 25% of
the combined net worth of my spouse and me, excluding principal
residence and home furnishings.
F-3-3
<PAGE>
/ / 5. I am a resident of Alabama or Wisconsin and, either alone or with
my representative, I have such knowledge and experience in
financial and business matters that I am capable of evaluating
the merits and risks of this investment.
F-3-4
<PAGE>
/ / 6. I am a director or executive officer of the Company.
-------------------------
Print Name of Shareholder(s)
-------------------------
Signature of Shareholder(s)
III. OTHER CERTIFICATIONS.
By signing the Signature Page, the undersigned Corporation certifies as
follows:
(a) that the Corporation's purchase of the Securities will be solely for
the Corporation's own account and not for the account of any other person
or entity; and
(b) that the Corporation's name, address of principal place of business,
place of incorporation and taxpayer identification number as set forth in
this Questionnaire are true, correct and complete.
IV. GENERAL INFORMATION.
(a) PROSPECTIVE PURCHASER (THE CORPORATION):
Name:
---------------------------------------------------------------------------
Principal Place of Business
-----------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Address for Correspondence (if different):
--------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
F-3-5
<PAGE>
Telephone Number:
----------------------------------------------------------------
(Area Code) (Number)
State of Incorporation:
---------------------------------------------------------
Date of Formation:
--------------------------------------------------------------
Taxpayer Identification Number:
-------------------------------------------------
Number of Shareholders:
---------------------------------------------------------
(b) THE INDIVIDUAL WHO IS EXECUTING THIS QUESTIONNAIRE ON BEHALF OF THE
CORPORATION
Name:
---------------------------------------------------------------------------
Position or Title:
--------------------------------------------------------------
(c) IF SECTION II HAS BEEN COMPLETED, NAMES OF INDIVIDUAL SHAREHOLDERS
WHOSE SIGNATURES MUST APPEAR ON PAGE C-4.
Name(s) of Shareholders:
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
F-3-6
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CORPORATION SIGNATURE PAGE
Your signature on this Corporation Signature Page evidences your agreement
to be bound by the Questionnaire.
8.17.1. The undersigned Corporation represents that (a) the undersigned has
read and understands the Private Placement Memorandum of Apartment Investment
and Management Company relating to the Securities, (b) the information contained
in this Questionnaire is complete and accurate and (c) the Corporation will
notify Apartment Investment and Management Company immediately if any material
change in any of this information occurs before the undersigned Corporation
acquires Securities and will promptly send written confirmation of such change.
8.17.2 The undersigned Corporation hereby represents and warrants that the
person signing this Questionnaire on behalf of the Corporation is duly
authorized to acquire the Securities and execute this Questionnaire on behalf
of the Corporation and, further, that the undersigned Corporation has all
requisite authority to purchase Securities and execute this Questionnaire.
--------------------------------------------------
Date
---------------------------------------------
Name of Corporation
(Please Type or Print)
By:
------------------------------------------
(Signature )
Name:
----------------------------------------
(Please Type or Print)
Title:
---------------------------------------
(Please Type or Print)
F-3-7
<PAGE>
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
UNLESS SUCH SECURITIES ARE INCLUDED IN AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE ACT OR AN OPINION OF COUNSEL, CONCURRED IN BY COUNSEL TO THE COMPANY, HAS
BEEN DELIVERED TO THE EFFECT THAT REGISTRATION OF SUCH SECURITIES IS NOT
REQUIRED.
F-3-8
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
TRUST QUESTIONNAIRE
To: Apartment Investment and Management Company
The information contained in this Questionnaire is being furnished in order
to determine whether the undersigned meets the suitability standards for an
investment in units of limited partnership (the "Securities") of AIMCO
Properties, L.P., a Delaware limited partnership (the "Company").
ALL INFORMATION CONTAINED IN THIS QUESTIONNAIRE WILL BE TREATED
CONFIDENTIALLY. The undersigned Trust understands, however, that the Company
may present this Questionnaire to such parties as it deems appropriate if called
upon to establish that the proposed offer and sale of the Securities is exempt
from registration under the Securities Act of 1933, as amended, or meets the
requirements of applicable state securities or "blue sky" laws. Further, the
undersigned Trust understands that the Company may be required to report the
offering in public filings with the Securities and Exchange Commission and to
various state securities or "blue sky" regulators.
IN ADDITION TO SIGNING THE SIGNATURE PAGE, THE UNDERSIGNED TRUST MUST
COMPLETE A FORM W-9.
I. PLEASE CHECK STATEMENTS 1 OR 2 BELOW, AS APPLICABLE.
/ / 8.17.3 (a) the Trust has total assets in excess of $5,000,000; AND
(b) the Trust was not formed for the specific purpose of
acquiring Securities; AND
(c) the purchase by the Trust is directed by a person who
has such knowledge and experience in financial and
business matters that he or she is capable of
evaluating the merits and risks of an investment in the
Securities.
/ / 8.17.4 The Trust is a revocable grantor Trust which the grantor may
revoke at any time without the consent or approval of any
other person; the grantor retains sole investment control
over the assets of the trust; and
F-4-1
<PAGE>
(a) the grantor is a natural person whose individual net
worth (*) or joint net worth with the grantor's spouse
is in excess of $1,000,000; or
(b) the grantor is a natural person who had an individual
income* in excess of $200,000 in each of the two most
recent years, and who reasonably expects an individual
income in excess of $200,000 in the current year; or
(c) the grantor is a natural person who, together with his
or her spouse, has had a joint income in excess of
$300,000 in each of the two most recent years, and who
reasonably expects a joint income in excess of $300,000
in the current year; or
(d) the grantor is a director or executive officer of the
Company.
----------------------------------------------------------------------------
IF THE TRUST IS A REVOCABLE GRANTOR TRUST, EACH GRANTOR MUST PHOTOCOPY AND
COMPLETE SECTION II BELOW.
----------------------------------------------------------------------------
II. FOR REVOCABLE GRANTOR TRUST ONLY: PLEASE CHECK ANY OF STATEMENTS 1-6 BELOW
THAT APPLY TO THE GRANTOR
/ / 8.17.5 I have an individual net worth or joint net worth with my
spouse in excess $1,000,000.
/ / 8.17.6 I have had an individual income in excess of $200,000 in
each of the two most recent years, and I reasonably expect
an individual income in excess of $200,000 for the current
year.
/ / 8.17.7 My spouse and I have had a joint income in excess of
$300,000 in each of the two most recent years, and I
reasonably expect a joint income in excess of $300,000 for
the current year.
- ----------------------------
* For purposes of this Questionnaire, the term "net worth" means the excess
of total liabilities. In determining "income," an investor should add to
his or her adjusted gross income any amounts attributable to tax-exempt
income received, losses claims as a limited partner in any limited
partnership, deductions claimed for depletion, contributions to IRA or
Keogh retirement plan, alimony payments and any amount by which income from
long-term capital gains has been reduced in arriving at adjusted gross
income.
F-4-2
<PAGE>
/ / 8.17.8 I am a Massachusetts resident, and my investment in the
Securities does not exceed 25% of my net worth or, if I am
married, 25% of the combined net worth of my spouse and me,
excluding principal residence and home furnishings.
/ / 8.17.9 I am a resident of Alabama or Wisconsin and, either alone or
with my representative, I have such knowledge and experience
in financial and business matters that I am capable of
evaluating the merits and risks of this investment.
/ / 8.17.10 I am a director or executive officer of the Company.
------------------------------
Name of Grantor(s)
------------------------------
Signature of Grantor(s)
III. OTHER CERTIFICATIONS.
By signing the Signature Page, the undersigned certifies as follows:
(a) that the Trust's purchase of Securities will be solely for the
Trust's own account and not for the account of any other person;
(b) that the Trust's purchase of the Securities is within the investment
powers and authority of the Trust (as set forth in the declaration of
trust or other governing instrument) and that all necessary consents,
approvals and authorizations for such purchase have been obtained and
that each person who signs the Signature Page has all requisite power
and authority as trustee to execute this Questionnaire on behalf of
the Trust;
(c) that the Trust has not been established in connection with either
(i) an employee benefit plan (as defined in Section 3(3) of
ERISA), whether or not subject to the provisions of Title I of
ERISA, or (ii) a plan described in Section 4975(e) (i) of the
Internal Revenue Code; and
(d) that the Trust's name, address, place of formation and taxpayer
identification number, as set forth in this Questionnaire, are true,
correct and complete.
F-4-3
<PAGE>
IV. GENERAL INFORMATION.
(a) PROSPECTIVE PURCHASER (THE TRUST):
Name:
---------------------------------------------------------------------------
Address:
------------------------------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Address for Correspondence (if different):
--------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Telephone Number:
---------------------------------------------------------------
(Area Code) (Number)
State in which Formed:
----------------------------------------------------------
Date of Formation:
--------------------------------------------------------------
Taxpayer Identification Number:
-------------------------------------------------
(b) TRUSTEE(S) WHO ARE EXECUTING THIS QUESTIONNAIRE ON BEHALF OF THE
TRUST.
Name(s) of Trustee(s):
----------------------------------------------------------
If Grantor Trust, Name(s) of Grantor(s):
----------------------------------------
(c) IF SECTION III HAS BEEN COMPLETED, NAMES OF INDIVIDUAL GRANTORS WHOSE
SIGNATURES MUST APPEAR ON PAGE D-3.
Name(s) of Grantors:
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
- --------------------------------------------------------------------------------
THE TRUST SHOULD ATTACH A COPY OF THE TRUST AGREEMENT, DECLARATION OF TRUST OR
OTHER GOVERNING INSTRUMENT, AS AMENDED, AS WELL AS ALL OTHER DOCUMENTS THAT
AUTHORIZE THE TRUST TO INVEST IN SECURITIES. ALL DOCUMENTATION MUST BE COMPLETE
AND CORRECT.
- --------------------------------------------------------------------------------
F-4-4
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
TRUST SIGNATURE PAGE
Your signature on this Trust Signature Page evidences the agreement by the
Trustee, on behalf of the Trust, to be bound by the Questionnaire.
1. The undersigned Trust represents that (a) the undersigned has read and
understands the Private Placement Memorandum of Apartment Investment and
Management Company relating to the Securities, (b) the information contained in
this Questionnaire is complete and accurate and (c) the Trust will notify
Apartment Investment and Management Company immediately if any material change
in any of this information occurs before the Trust acquires Securities and will
promptly send written confirmation of such change.
2. The undersigned Trust hereby represents and warrants that the person
signing this Questionnaire on behalf of the Trust is duly authorized to acquire
the Securities and to execute this Questionnaire on behalf of the Trust and,
further, that the undersigned Trust has all requisite authority to purchase such
Securities.
------------------------------
Date
Please Type or Print the Exact
Legal Title of Trust as follows:
Trustee's name, as trustee for Title of Trust
[Name of Grantor] under Agreement ------------------------------
[or Declaration] of Trust dated
[Date of Trust Formation] Name of
Trustee:
----------------------
(Please Type or Print)
By:
---------------------------
(Signature of Trustee)
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
UNLESS SUCH SECURITIES ARE INCLUDED IN AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE ACT OR AN OPINION OF COUNSEL, CONCURRED IN BY COUNSEL TO THE COMPANY, HAS
BEEN DELIVERED TO THE EFFECT THAT REGISTRATION OF SUCH SECURITIES IS NOT
REQUIRED.
F-4-5
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
RETIREMENT PLAN QUESTIONNAIRE
To: Apartment Investment and Management Company
The information contained in this Questionnaire is being furnished in order
to determine whether the undersigned meets the suitability standards for an
investment in units of limited partnership (the "Securities") of AIMCO
Properties, L.P., a Delaware limited partnership (the "Company").
ALL INFORMATION CONTAINED IN THIS QUESTIONNAIRE WILL BE TREATED
CONFIDENTIALLY. The undersigned Retirement Plan understands, however, that the
Company may present this Questionnaire to such parties as it deems appropriate
if called upon to establish that the proposed offer and sale of the Securities
is exempt from registration under the Securities Act of 1933, as amended, or
meets the requirements of applicable state securities or "blue sky" laws.
Further, the undersigned Retirement Plan understands that the Company may be
required to report the offering in public filings with the Securities and
Exchange Commission and to various state securities or "blue sky" regulators.
IN ADDITION TO SIGNING THE SIGNATURE PAGE, THE UNDERSIGNED RETIREMENT PLAN
MUST COMPLETE A FORM W-9.
I. PLEASE CHECK ANY OF THE FOLLOWING STATEMENTS, AS APPLICABLE:
/ /1. The undersigned Retirement Plan certifies that it is a Keogh plan
or Individual Retirement Account in which each participant
satisfies at least one of the following conditions:
(a) such person's individual net worth or joint net worth with
his or her spouse is in excess of $1,000,000; or
- ----------------------
* For purposes of this Questionnaire, the term "net worth" means the excess
of total assets over total liabilities. In determining "income," an
investor should add to his or her adjusted gross income any amounts
attributable to tax-exempt income received, losses claimed as a limited
partner in any limited partnership, deductions claimed for depletion,
contributions to IRA or Keogh retirement plan, alimony payments and any
amount by which income from long-term capital gains has been reduced in
arriving at adjusted gross income.
F-5-1
<PAGE>
(b) such person has an individual income* in excess of
$200,000 in each of the two most recent years, and
reasonably expects an individual income in excess of
$200,000 in the current year; or
(c) such person, together with his or her spouse, had a joint
income in excess of $300,000 in each of the two most
recent years, and reasonably expects a joint income in
excess of $300,000 in the current year.
2. The undersigned Retirement Plan certifies that it is an employee
benefit plan within the meaning of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), and:
/ / (a) The undersigned Retirement Plan is self-directed, and each such
person directing his account and for whom the investment is being
made satisfies at least one of the following conditions:
(i) such person's individual net worth or joint net worth with
his or her spouse exceeds $1,000,000; or
(ii) such person had an individual income in excess of $200,000
in each of the two most recent years, and reasonably
expects an individual income in excess of $200,000 in the
current year; or
(iii) such person, together with his or her spouse, had a joint
income in excess of $300,000 in each of the two most
recent years, and reasonably expects a joint income in
excess of $300,000 in the current year.
(iv) such person is a director or executive officer of the
Company.
/ / (b) The undersigned Retirement Plan has total assets in excess of
$5,000,000; or
/ / (c) The investment decisions are made by a plan fiduciary, as defined
in Section 3(21) of ERISA, that is either a bank, savings and
loan association, insurance company or registered investment
advisor.
- --------------------------------------------------------------------------------
IF YOU CHECKED STATEMENT 1 OR STATEMENT 2(a) IN SECTION I ABOVE, EACH RETIREMENT
PLAN PARTICIPANT FOR WHOSE ACCOUNT THE INVESTMENT IS BEING MADE MUST PHOTOCOPY
AND COMPLETE SECTION II BELOW.
- --------------------------------------------------------------------------------
F-5-2
<PAGE>
II. IF YOU CHECKED STATEMENT 1 OR STATEMENT 2(a) IN SECTION I ABOVE, EACH
RETIREMENT PLAN PARTICIPANT FOR WHOSE ACCOUNT THE INVESTMENT IS BEING
MADE MUST CHECK ANY OF THE STATEMENTS 1-6 BELOW THAT APPLIES TO SUCH
PARTICIPANT.
/ / 1. I have an individual net worth or joint net worth with my spouse
in excess of $ 1,000,000.
/ / 2. I have had an individual income in excess of $200,000 in each of
the two most recent years, and I reasonably expect an individual
income in excess of $200,000 for the current year. NOTE: IF YOU
ARE BUYING JOINTLY WITH YOUR SPOUSE, YOU MUST EACH HAVE AN
INDIVIDUAL INCOME IN EXCESS OF $200,000 IN EACH OF THESE YEARS IN
ORDER TO CHECK THIS BOX.
/ / 3. My spouse and I have had a joint income in excess of $300,000 in
each of the two most recent years, and I reasonably expect a
joint income in excess of $300,000 for the current year.
/ / 4. I am a Massachusetts resident, and my investment in the
Securities does not exceed 25% of my net worth or, if I am
married, 25% of the combined net worth of my spouse and me,
excluding principal residence and home furnishings.
/ / 5. I am a resident of Alabama or Wisconsin and, either alone or with
my representative, I have such knowledge and experience in
financial and business matters that I am capable of evaluating
the merits and risks of this investment.
/ / 6. I am a director or executive officer of the Company.
-----------------------------------
Print Name of Participant
-----------------------------------
Signature of Participant
F-5-3
<PAGE>
III. OTHER CERTIFICATIONS.
By signing the Signature Page, the undersigned Retirement Plan certifies as
follows:
(a) that the Retirement Plan's purchase of Securities will be solely for
the Retirement Plan's own account and not for the account of any other
person or entity;
(b) that the Retirement Plan's governing documents duly authorize the type
of investment contemplated herein, and the undersigned is authorized and
empowered to make such investment on behalf of the Retirement Plan; and
(c) that the Retirement Plan's name, address, place of formation and
taxpayer identification number as set forth in this Questionnaire are true,
correct and complete.
IV. GENERAL INFORMATION.
(a) PROSPECTIVE PURCHASER (THE RETIREMENT PLAN):
Name:
-------------------------------------------------------------------------
Address:
----------------------------------------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Address for Correspondence (if different):
--------------------------------------
(Number and Street)
- --------------------------------------------------------------------------------
(City) (State) (Zip Code)
Telephone Number:
-------------------------------------------------------------
(Area Code) (Number)
State in which Formed:
--------------------------------------------------------
Date of Formation:
------------------------------------------------------------
Taxpayer Identification Number:
-----------------------------------------------
F-5-4
<PAGE>
(b) THE INDIVIDUAL WHO IS EXECUTING THIS QUESTIONNAIRE ON BEHALF OF THE
RETIREMENT PLAN (TRUSTEE FOR AN EMPLOYEE BENEFIT PLAN; CUSTODIAN FOR
AN IRA OR KEOGH):
Name:
-------------------------------------------------------------------------
Position or Title:
--------------------------------------------------------------
(c) IF SECTION II HAS BEEN COMPLETED, NAMES OF PARTICIPANTS WHOSE
SIGNATURES MUST APPEAR ON PAGE E-4.
Name(s) of Participants:
--------------------------------------------------
--------------------------------------------------
--------------------------------------------------
- --------------------------------------------------------------------------------
THE RETIREMENT PLAN SHOULD TO ATTACH COPIES OF ALL DOCUMENTS GOVERNING THE PLAN,
AS WELL AS ALL OTHER DOCUMENTS AUTHORIZING THE RETIREMENT PLAN TO INVEST IN THE
SECURITIES. INCLUDE, AS NECESSARY, THE TRUST AGREEMENT AND DOCUMENTS DEFINING
PERMITTED INVESTMENTS BY THE RETIREMENT PLAN AND DEMONSTRATING AUTHORITY OF THE
SIGNING INDIVIDUAL TO ACT ON BEHALF OF THE PLAN. ALL DOCUMENTATION MUST BE
COMPLETE AND CORRECT.
- --------------------------------------------------------------------------------
F-5-5
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
RETIREMENT PLAN SIGNATURE PAGE
Your signature on this Retirement Plan Signature Page evidences the
agreement by the Retirement Plan to be bound by the Questionnaire.
1. The undersigned Retirement Plan hereby represents that (a) the
undersigned has read and understands the Private Placement Memorandum of
Apartment Investment and Management Company relating to Securities, (b) the
information contained in this Questionnaire is complete and accurate and (c) the
Retirement Plan will notify Apartment Investment and Management Company
immediately if any material change in any of this information occurs before the
undersigned Retirement Plan acquires Securities and will promptly send written
confirmation of such change
2. The undersigned hereby represents and warrants that the person signing
this Questionnaire on behalf of the Retirement Plan is duly authorized to
acquire the Securities and execute this Questionnaire on behalf of the
Retirement Plan and, further, that the undersigned Retirement Plan has all
requisite authority to purchase Securities and execute this Questionnaire.
-------------------------------
Date
-------------------------------
Name of Retirement Plan
(Please Type or Print)
By:
----------------------------
(Signature)
Name:
--------------------------
(Please Type or Print)
Title:
-------------------------
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
UNLESS SUCH SECURITIES ARE INCLUDED IN AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE ACT OR AN OPINION OF COUNSEL, CONCURRED IN BY COUNSEL TO THE COMPANY, HAS
BEEN DELIVERED TO THE EFFECT THAT REGISTRATION OF SUCH SECURITIES IS NOT
REQUIRED.
F-5-6
<PAGE>
EXHIBIT "G"
ACKNOWLEDGEMENT AND ACCEPTANCE
OF ADMISSION OF LIMITED PARTNER
Acknowledgement AND ACCEPTANCE OF ADMISSION OF LIMITED PARTNER, dated as of
, 1997 (this "ACKNOWLEDGEMENT"), by and between AIMCO-GP, Inc.,
a Delaware corporation ("AIMCO-GP"), and First Alexandria Associates Limited
Partnership, a Virginia limited partnership (the "ADMITTED"). Capitalized terms
used but not otherwise defined herein shall have the meanings ascribed thereto
in that certain Second Amended and Restated Agreement of Limited Partnership of
AIMCO PROPERTIES, L.P., dated as of July 29, 1994 (as amended, the "PARTNERSHIP
AGREEMENT").
WHEREAS, AIMCO-GP is the general partner of AIMCO PROPERTIES, L.P., a
Delaware limited partnership (the "PARTNERSHIP" or "AIMCO OP"), under the
Partnership Agreement;
WHEREAS, the Admitted has contributed to the Partnership certain assets in
exchange for Partnership Common Units; and
WHEREAS, AIMCO-GP desires to evidence the admission of the Admitted as an
Additional Limited Partner in the Partnership, and the Admitted desires to
evidence acceptance of such admission to the Partnership.
NOW, THEREFORE, in consideration of the foregoing and the covenants of the
parties set forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, subject to the terms
and conditions set forth herein, the parties hereby agree as follows:
1. EXHIBIT "A" to the Partnership Agreement is hereby amended and
supplemented by the addition of the line items set forth in EXHIBIT "A" attached
to this Acknowledgement.
2. In accordance with Sections 4.2A and 12.2.A of the Partnership
Agreement, AIMCO-GP hereby admits the Admitted as an Additional Limited Partner
of the Partnership with the interests in the Partnership set forth in EXHIBIT
"A" to this Acknowledgement.
3. AIMCO-GP hereby certifies that a true and correct copy of the
Partnership Agreement is annexed hereto as EXHIBIT "B" and is made a part
hereof.
G-1
<PAGE>
4. This Acknowledgement shall be binding upon the parties hereto and
their respective successors, assigns, heirs and legal representatives and may be
relied upon by them and by other third parties.
5. By its signature below, the Admitted hereby accepts admission to the
Partnership as an Additional Limited Partner and agrees to be bound by all of
the provisions of the Partnership Agreement, which are incorporated herein by
this reference, including, without limitation, the power of attorney set forth
in Section 2.4 of the Partnership Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Acknowledgement
and the attachment counterpart signature page to the Partnership Agreement
effective as of the date first written above.
AIMCO-GP:
AIMCO-GP, INC.,
a Delaware corporation
By:
-----------------------------------------------
Harry Alcock
Vice President
THE ADMITTED:
FIRST ALEXANDRIA ASSOCIATES
LIMITED PARTNERSHIP,
a Virginia limited partnership
By: THE NATIONAL HOUSING
PARTNERSHIP,
a District of Columbia limited partnership
Its: General Partner
By: NATIONAL CORPORATION
FOR HOUSING PARTNERSHIPS,
a District of Columbia corporation
Its: General Partner
By:
-----------------------------------
Tom Toomey
Executive Vice President
Finance and Administration
G-2
<PAGE>
EXHIBIT "A"
PARTNERS, CONTRIBUTIONS AND PARTNERSHIP INTERESTS
- --------------------------------------------------------------------------------
NAME AND ADDRESS OF NET AGREED PARTNERSHIP
ADDITIONAL LIMITED PARTNER VALUE OF COMMON
CONTRIBUTED UNITS
PROPERTY
- --------------------------------------------------------------------------------
First Alexandria Associates
Limited Partnership
Address:
-------
c/o The National Housing Partnership
8065 Leesburg Pike, Suite 400
Vienna, VA 22182-2738
Attention: General Counsel
- --------------------------------------------------------------------------------
G-3
<PAGE>
EXHIBIT "B"
THE PARTNERSHIP AGREEMENT
G-4
<PAGE>
Exhibit 99.2
PRO FORMA FINANCIAL INFORMATION OF
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
INTRODUCTION
On May 5, 1997, pursuant to a Stock Purchase Agreement, dated as of April
16, 1997 (the "Stock Purchase Agreement"), Apartment Investment and
Management Company, a Maryland corporation ("AIMCO" and, together with its
majority-owned subsidiaries and controlled entities, the "Company"), acquired
2,866,073 shares of common stock ("NHP Common Stock") of NHP Incorporated
("NHP") in exchange for 2,142,857 shares of AIMCO's Class A Common Stock
("AIMCO Common Stock"). AIMCO contributed such shares of NHP Common Stock to
its wholly owned subsidiary, AIMCO-LP, Inc., which contributed such shares of
NHP Common Stock to AIMCO's operating partnership, AIMCO Properties, L.P.
(the "Operating Partnership"), in exchange for additional partnership
interests ("OP Units") in the Operating Partnership. The Operating
Partnership contributed such shares of NHP Common Stock to AIMCO's
unconsolidated subsidiary, AIMCO/NHP Holdings, Inc. ("ANHI"), in exchange for
95,000 shares of ANHI's Series A Preferred Stock (the "First ANHI Stock
Transfer"). In addition, on May 5, 1997, pursuant to the Stock Purchase
Agreement, ANHI acquired 3,630,000 shares of NHP Common Stock for $72.6
million in cash. Such cash consideration was obtained by ANHI from the
proceeds of a loan made pursuant to a Credit Agreement (the "ANHI Credit
Facility"). The acquisition of 6,496,073 shares of NHP Common Stock by
AIMCO and ANHI on May 5, 1997, is hereinafter referred to as the "Initial
NHP Stock Purchase."
On June 3, 1997, the Company acquired a group of companies (the "NHP
Real Estate Companies") previously owned by NHP that hold interests in
partnerships that own 534 conventional and affordable multifamily apartment
properties (the "NHP Properties") containing 87,659 units, a captive
insurance subsidiary and certain related assets (the "NHP Real Estate
Acquisition"). AIMCO is currently engaged in a reorganization (the "NHP Real
Estate Reorganization") of its interests in the NHP Real Estate Companies,
which will result in the vast majority of the assets of the NHP Real Estate
companies being owned by a limited partnership (the "Unconsolidated
Partnership") in which the Operating Partnership will hold a 99% limited
partner interest and certain directors and officers of AIMCO will, directly
or indirectly, hold a 1% general partner interest.
1
<PAGE>
On August 26, 1997, AIMCO sold 2,400,000 shares of AIMCO Common Stock to
an institutional investor, at a price of $31.60 per share, and used
substantially all of the net proceeds from such sale to purchase 3,717,000
shares of NHP Common Stock from ANHI for an aggregate price of $74.3 million
(the "August 1997 Stock Offering"). ANHI used the proceeds from its sale of
such shares of NHP Common Stock to repay its outstanding borrowings under the
ANHI Credit facility, and then terminated the ANHI Credit Facility.
On September 12, 1997, AIMCO sold 2,373,418 shares of AIMCO Common Stock
to an institutional investor at a price of $31.60 per share, and sold 279,000
shares of AIMCO Common Stock to another institutional investor at a price of
$33.125 per share. AIMCO used $40.0 million in proceeds from such sales to
purchase 2,000,000 shares of NHP Common Stock from ANHI (the "Second ANHI
Stock Transfer" and, together with the First ANHI Stock Transfer the "ANHI Stock
Transfers"), $7,039,500 of such proceeds to purchase an additional 351,975
shares of NHP Common Stock pursuant to the Stock Purchase Agreement, and
$35.5 million of such proceeds to reduce the amount outstanding under AIMCO's
credit facility. On September 12, 1997, AIMCO also acquired an additional
82,074 shares of NHP Common Stock pursuant to the Stock Purchase Agreement in
exchange for 61,364 shares of AIMCO Common Stock. AIMCO's acquisition of an
aggregate of 434,049 shares of NHP Common Stock on September 12, 1997
pursuant to the Stock Purchase Agreement, is hereinafter referred to as the
"Subsequent NHP Stock Purchase" and, together with the Initial NHP Stock
Purchase, the "NHP Stock Purchase." AIMCO's sale of an aggregate of 2,652,418
shares of AIMCO Common Stock on September 12, 1997, and the application of
the net proceeds thereof is hereinafter referred to as the "September 1997
Stock Offerings."
As a result of tender offers commenced in June 1997 and continuing
through mid-November 1997, the Company acquired a majority limited partner
interest in three partnerships for which the Company serves as General
Partner (the "LP Acquisitions"): (i) approximately 54% of the limited partner
interests in Country Lakes Associates Two, the owner of the multi-family
apartment community known as The Greens of Naperville, Naperville, Illinois,
for approximately $521,000 in cash and OP Units, (ii) approximately 62% of
the limited partner interests in Point West Limited Partnership, owner of the
multi-family apartment community known as Point West Apartments,
Lenexa, Kansas, for approximately $379,000 in cash and OP Units, and (iii)
approximately 72% of the limited partner interests in The Oak Park
Partnership, the owner of the multi-family apartment community known as 100
Forest Place Apartments, Oak Park, Illinois, for approximately $3.35 million
in cash and OP Units.
On October 31, 1997, the Company purchased a portfolio of 8,175 units in 35
apartment communities from sellers associated with Winthrop Financial
Associates (the "Thirty-five Acquisition Properties"). The aggregate purchase
price of $263.5 million (including $10.0 million of transaction costs) was
comprised of $116.1 million in cash and the creation or assumption of $147.4
million of mortgage indebtedness.
On December 1, 1997, the Company purchased the property known as
Foxchase Apartments ("Foxchase" and such acquisition is defined as the
"Foxchase Acquisition"), a 2,113 unit apartment complex located in
Alexandria, Virginia for approximately $110.3 million in cash, assumed
mortgage obligations and OP Units. The Company purchased Foxchase from a
limited partnership for which the Company serves as General Partner and
majority limited partner.
On December 8, 1997, AIMCO/NHP Acquisition Corp., a wholly-owned
subsidiary of AIMCO ("Merger Sub"), merged (the "Merger") with and into NHP,
with NHP being the surviving corporation after the Merger and becoming a
wholly-owned subsidiary of AIMCO. As a result of the Merger, each
outstanding share of NHP Common Stock, other than NHP Common Stock held by
NHP, AIMCO or Merger Sub, was converted (subject to certain exceptions) into
the right to receive (i) 0.74766 shares of AIMCO Common Stock (the "Stock
Consideration"), or (ii) at the election of the holder, 0.37383 shares of
AIMCO Common Stock and $10.00 in cash (the "Mixed Consideration"). Also in
the Merger, outstanding options to purchase shares of NHP Common Stock were
converted into options to purchase shares of AIMCO Common Stock.
2
<PAGE>
Immediately following the Merger, AIMCO engaged in a restructuring (the
"NHP Reorganization") of the assets and operations of NHP that resulted in
the Master Property Management Agreement being terminated and NHP's
operations being conducted through ANHI and/or other unconsolidated
subsidiaries of AIMCO (together with ANHI, the "Unconsolidated
Subsidiaries"). The Unconsolidated Subsidiaries have an ownership structure
similar to ANHI, in which the Company holds a 95% economic interest through
ownership of shares of non-voting preferred stock, and certain directors and
officers of AIMCO hold a 5% economic interest through direct or indirect
ownership of all of the outstanding shares of common stock. As a result of
the controlling ownership interest in the Unconsolidated Subsidiaries held by
such directors and officers, AIMCO will account for its interest in the
Unconsolidated Subsidiaries using the equity method.
Pursuant to rights distributed to NHP stockholders in May 1997 (the
"Rights Distribution"), upon the effective time of the Merger all of the
outstanding shares of common stock of The WMF Group, Ltd., formerly a wholly
owned subsidiary of NHP ("WMF"), were distributed to NHP stockholders (the
"WMF Spin-Off"). Shares of WMF common stock issued to AIMCO and ANHI in the
WMF Spin-Off were transferred to the sellers of NHP Common Stock pursuant to
the Stock Purchase Agreement.
3
<PAGE>
PRO FORMA FINANCIAL INFORMATION
The following Pro Forma Consolidated Balance Sheet of AIMCO as of
September 30, 1997 has been prepared as if each of the following transactions
had occurred as of September 30, 1997: (i) the Company's sale of 7,000,000
shares of AIMCO Common Stock in October 1997 (the "October 1997 Stock
Offering") and the application of such net proceeds (a) to acquire 35
multifamily apartment properties from Winthrop Financial Associates (the
"Winthrop Acquisition") and (b) to repay indebtedness; (ii) the Company's
disposition of five real estate properties (the "1997 Dispositions"); (iii) the
Company's purchase of the Windward Apartments (the "Windward Acquisition"); (iv)
the Company's purchase of Foxchase Apartments (the "Foxchase Acquisition"); (v)
the acquisition of partnership interests through tender offers in certain
partnerships in which the Company acquired ownership interests in the NHP Real
Estate Acquisition (the "Tender Offers") (vi) the Merger; (vii) the WMF
Spin-Off; and (viii) the NHP Reorganization.
The following Pro Forma Consolidated Statement of Operations of AIMCO
for the year ended December 31, 1996 has been prepared as if each of the
following transactions had occurred as of January 1, 1996: (i) the NHP Stock
Purchase and the ANHI Stock Transfers; (ii) the NHP Real Estate Acquisition;
(iii) the NHP Real Estate Reorganization; (iv) the Company's acquisition
during 1996 of (a) seven multifamily apartment properties, (b) general and
limited partnership interests in limited partnerships owning 22 multifamily
apartment properties, and (c) general partnership interest in and loans to
limited partnerships owning 12 multifamily apartment properties, the related
issuance of AIMCO Common Stock and Partnership Common Units of AIMCO
Properties, L.P., the incurrence of indebtedness to finance such
acquisitions, and the refinancing of such indebtedness (the "1996
Acquisitions"); (v) the Company's disposition of four multifamily apartment
properties (the "1996 Dispositions"); (vi) the Company's purchase of a
management company in the third quarter of 1996 (the "Management Company
Acquisition"); (vii) the Company's acquisition of (a) the Tustin East Village
and The Californian apartments in June 1997, (b) the Vinings at the Waterways
in June 1997, (c) the Stonebrook Apartments in May 1997, and (d) The Bay Club
at Aventura in April 1997 (collectively, the "Recent Property Acquisitions");
(viii) AIMCO's sale of 1,265,000 shares of AIMCO Common Stock in November
1996, and the application of the net proceeds thereof to repay indebtedness
(the "November 1996 Stock Offering"); (ix) AIMCO's sale of 2,015,000 shares
of AIMCO common stock in February 1997, and the application of the net
proceeds thereof to repay indebtedness (the "February 1997 Stock Offering");
(x) AIMCO's sale of 2,300,000 shares of AIMCO common stock in May 1997, and
the application of the net proceeds thereof to repay indebtedness (the "May
1997 Stock Offering"); (xi) AIMCO's August 1997 sale of 750,000 shares of
Class B Preferred Stock and the application of the net proceeds thereof to
repay indebtedness (the "Preferred Stock Offering"); (xii) the August 1997
Stock Offering; (xiii) the September 1997 Stock Offerings; (xiv) the
Company's receipt of a dividend from ANHI from proceeds ANHI received from
the ANHI Stock Transfers (the "ANHI Dividend"); (xv) the Company's purchase
of 886,600 shares of common stock of Ambassador Apartments, Inc. (the
"Ambassador Stock Acquisition"); (xvi) the purchase of third-party notes
payable secured by
4
<PAGE>
three properties owned by real estate partnerships in which the Company
acquired ownership interests in the NHP Real Estate Acquisition, and the
conversion of such notes payable into loans from the general partner (the "Loan
Acquisitions"); (xvii) the purchase of land leased by two properties owned by
real estate partnerships in which the Company acquired ownership interests in
the NHP Real Estate Acquisition (the "Land Lease Acquisitions"); (xviii) the
payment of third-party notes payable secured by one property owned by a real
estate partnership in which the Company acquired ownership interests in the NHP
Real Estate Acquisition (the "Property Loan Payment"); (xix) the Company's
purchase of the Sawgrass Apartments (the "Sawgrass Acquisition"); (xx) the
Company's purchase of an interest in a partnership owning the Morton Towers
Apartments (the "Morton Towers Acquisition"); (xxi) the Company's acquisition
of the Los Arboles Apartments (the "Los Arboles Acquisition"); (xxii) the
October 1997 Stock Offering and the Winthrop Acquisition; (xxiii) the 1997
Dispositions; (xxiv) the Windward Acquisition; (xxv) the Foxchase Acquisition;
(xxvi) the Tender Offers; (xxvii) the Merger; (xxviii) the WMF Spin-Off; and
(xxxi) the NHP Reorganization.
The following Pro Forma Consolidated Statement of Operations of AIMCO for
the nine months ended September 30, 1997 has been prepared as if each of the
following transactions had occurred as of January 1, 1997: (i) the NHP Stock
Purchase and the ANHI Stock Transfers; (ii) the NHP Real Estate Acquisition;
(iii) the Recent Property Acquisitions; (iv) the February 1997 Stock Offering;
(v) the May 1997 Stock Offering; (vi) the Preferred Stock Offering; (vii) the
August 1997 Stock Offering; (viii) the September 1997 Stock Offerings; (ix) the
ANHI Dividend; (x) the Ambassador Stock Acquisition; (xi) the Loan
Acquisitions; (xii) the Land Lease Acquisitions; (xiii) the Property Loan
Payment; (xiv) the Sawgrass Acquisition; (xv) the Morton Towers Acquisition;
(xvi) the Los Arboles Acquisition; (xvii) the October 1997 Stock Offering and
the Winthrop Acquisition; (xviii) the 1997 Dispositions; (xix) the Windward
Acquisition; (xx) the Foxchase Acquisition; (xxi) the Tender Offers; (xxii) the
Merger; (xxiii) the WMF Spin-Off; and (xxiv) the NHP Reorganization.
The following Pro Forma Financial Information is based, in part, on the
following historical financial statements, which have been previously filed by
AIMCO: (i) the Consolidated Financial Statements of AIMCO for the year ended
December 31, 1996 and the nine months ended September 30, 1997; (ii) the
restated Consolidated Financial Statements of NHP for the year ended December
31, 1996 (which have been restated to reflect WMF as a discontinued operation
as a result of the Rights Distribution) and for the nine months ended September
30, 1997; (iii) the Combined Financial Statements of the NHP Real Estate
Companies for the year ended December 31, 1996 and the three months ended March
31, 1997; (iv) the Financial Statements of NHP Southwest Partners, L.P. for the
year ended December 31, 1996 and the three months ended March 31, 1997; (v) the
Combined Financial Statements of the NHP New LP Entities for the year ended
December 31, 1996 and the three months ended March 31, 1997; (vi) the Combined
Financial Statements of the NHP Borrower Entities for the year ended December
31, 1996 and the three months ended March 31, 1997; (vii) the Historical
Summaries of Gross Income and Certain Expenses of The Bay Club at Aventura for
the year ended December 31, 1996 and the three months ended March 31, 1997;
(viii) the Historical Summary of Gross Income and Direct Operating Expenses of
Morton Towers for the year ended December
5
<PAGE>
31, 1996 and the six months ended June 30, 1997; and (ix) the Combined
Statement of Revenues and Certain Expenses of the Thirty-Five Acquisition
Properties for the year ended December 31, 1996 and the six months ended June
30, 1997. The following Pro Forma Financial Information is also based on (i)
the [Financial Statements of Foxchase] for the year ended December 31, 1996 and
the nine months ended September 30, 1997; (ii) [add other financial
statements]. The following Pro Forma Financial Information should be read in
conjunction with such financial statements and the notes thereto. In the
opinion of AIMCO's management, all material adjustments necessary to reflect
the effects of these transactions have been made.
The unaudited Pro Forma Financial Information has been prepared using the
purchase method of accounting whereby the assets and liabilities of NHP are
adjusted to estimated fair market value, based upon preliminary estimates,
which are subject to change as additional information is obtained. The
allocations of purchase costs are subject to final determination based upon
estimates and other evaluations of fair market value. Therefore, the
allocations reflected in the following unaudited Pro Forma Financial
Information may differ from the amounts ultimately determined.
The following Pro Forma Financial Information assumes that ANHI elects to
receive Mixed Consideration, and all other NHP stockholders elect to receive
Stock Consideration. However, the notes to the pro forma financial statements
disclose the effect of all NHP stockholders electing to receive Mixed
Consideration. The Pro Forma financial information also assumes that no NHP
stockholder will receive cash in lieu of shares in excess of the Ownership
limit in AIMCO's Charter or fractional shares.
The following unaudited Pro Forma Financial Information is presented for
informational purposes only and is not necessarily indicative of the financial
position or results of operations of AIMCO that would have occurred if such
transactions had been completed on the dates indicated, nor does it purport to
be indicative of future financial positions or results of operations. In the
opinion of AIMCO's management, all material adjustments necessary to reflect
the effects of these transactions have been made. The unaudited Pro Forma
Consolidated Statement of Operations for the nine months ended September 30,
1997 is not necessarily indicative of the results of operations to be expected
for the year ending December 31, 1997.
6
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
October 1997
Offering &
AIMCO Winthrop Foxchase NHP
Historical (A) Adjustments (B) Acquisition(C) Acquisition (D) Historical
------------ ------------------- -------------- --------------- ----------
<S> <C> <C> <C> <C> <C>
ASSETS
Real estate $1,107,545 $ 55,897 $ 263,500 $110,270 $ 81,857
Real estate held for sale 25,580 (19,141) - - -
Investments held for sale 25,025 - - - -
Investments in and notes receivable from
Unconsolidated Subsidiaries 19,960 - - - -
Investments in and notes receivable from
real estate partnerships 174,777 (12,525) - (102) -
Investment in NHP Stock 123,078 - - - -
Cash and cash equivalents 45,775 567 19,168 1,654 4,618
Restricted cash 22,019 1,547 - 3,346 2,440
Investment in Management Contracts - - - - 45,478
Goodwill - - - - 5,425
Accounts receivable 24,328 (40) - 7 14,055
Deferred financing costs 7,682 1,073 1,381 1,139 1,034
Net deferred tax asset - - - - 12,883
Other assets 32,426 83 - 338 66,991
---------- -------- --------- -------- --------
$1,608,195 $ 27,461 $ 284,049 $116,652 $234,781
---------- -------- --------- -------- --------
---------- -------- --------- -------- --------
LIABILITIES AND SHAREHOLDERS' EQUITY
Secured long-term notes payable $ 492,977 $ 37,545 $ 148,781 $68,911 $ 71,842
Secured short-term financing 94,297 4,124 (106,212) 13,705 -
Secured long-term tax-exempt
bond financing 74,441 - - - -
Unsecured short-term financing - - - - 62,138
Accrued management contract liability 106,615 - - - -
Accounts payable, accrued and
other liabilities 72,533 (5,807) - 1,641 23,695
Resident security deposits and
prepaid rents 8,919 394 - 376
Other long-term liabilities - - - - 9,592
Deferred tax liability - - - - -
---------- -------- --------- ------- --------
849,782 36,256 42,569 84,633 167,267
---------- -------- --------- ------- --------
Minority interest in other partnerships
and corporations 19,355 (6,922) - 27,452 -
Minority interest in Operating Partnership 111,632 1,124 - 4,567 -
Unrealized gain on investments 1,175 - - - -
Class B Preferred Stock ($.01 par value) 75,000 - - - -
Class A Common Stock ($.01 par value) 283 - 70 - 130
Class B Common Stock ($.01 par value) 3 - - - -
Additional paid-in capital 606,799 - 241,410 - 140,140
Notes due on common stock purchases (30,459) - - - -
Retained earnings (distributions in
excess of earnings) (25,375) (2,997) - - (72,756)
---------- -------- --------- -------- --------
627,426 (2,997) 241,480 - 67,514
---------- -------- --------- -------- --------
$1,608,195 $ 27,461 $ 284,049 $116,652 $234,781
---------- -------- --------- -------- --------
---------- -------- --------- -------- --------
<CAPTION>
AIMCO
Merger Before NHP NHP Reor- Pro Forma
(E)Adjustments (F) Reorganization (G) ganization (H) Total
------------- ------------------ ------------------- ----------
<S> <C> <C>
ASSETS
Real estate $ 18,081 (I) $1,637,150 $(210,036) (N)
(99,938) (O) $1,327,176
Real estate held for sale - 6,439 - 6,439
Investments held for sale - 25,025 - 25,025
Investments in and notes receivable from
Unconsolidated Subsidiaries - 19,960 55,304 (N)
40,000 (P) (Q)
30,742 (N)
17,426 (P) (R) 163,432 (V)
Investments in and notes receivable from
real estate partnerships - 162,150 (22,049) (N)
(9,865) (N)
31,449 (O) 161,685
Investment in NHP Stock 15,581 (J)
121,036 (K)
(259,695) (I)
Cash and cash equivalents - 71,782 (2,558) (N)
(1,379) (O)
(3,239) (P) 64,606
Restricted cash - 29,352 (3,978) (N)
(2,440) (O) 22,934
Investment in Management Contracts 115,415 (I)
(106,615) (L) 54,278 (53,534) (P) (S) 744
Goodwill 120,006 (I) 125,431 (53,147) (P) (T) 72,284
Accounts receivable - 38,350 4 (N)
(1,022) (O)
(13,033) (P) 24,299
Deferred financing costs - 12,309 (1,173) (N)
(1,034) (O) 10,102
Net deferred tax asset (6,000) (M)
(6,883) (I)
Other assets (6,505) (I) (588) (N)
(24,252) (M) 69,081 (190) (O)
(36,044) (P) 32,259
----------- ---------- ------------ -----------
$ (19,831) $2,251,307 $ (340,322) $1,910,985
----------- ---------- ------------ -----------
----------- ---------- ------------ -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Secured long-term notes payable $ - $ 820,056 $ (136,996) (N)
(71,081) (O) $ 611,979
Secured short-term financing 7,791 (J) 13,705 (13,705) (N) (U)
Secured long-term tax-exempt
bond financing - 74,441 - 74,441
Unsecured short-term financing - 62,138 (62,138) (P) -
Accrued management contract liability (106,615) (L) -
Accounts payable, accrued and
other liabilities 4,541 (I) 96,603 (13,085) (N)
(3,297) (O)
(21,439) (P) 58,782
Resident security deposits and
prepaid rents 9,689 (590) (N) 9,099
Other long-term liabilities - 9,592 (9,592) (P) -
Deferred tax liability 8,223 (I) 8,223 (8,223) (P)
----------- ---------- ------------ -----------
(86,060) 1,094,447 (340,146) 754,301
----------- ---------- ------------ -----------
Minority interest in other partnerships
and corporations - 39,885 (176) (O) 39,709
Minority interest in Operating Partnership - 117,323 - 117,323
Unrealized gain on investments - 1,175 - 1,175
Class B Preferred Stock ($.01 par value) - 75,000 - 75,000
Class A Common Stock ($.01 par value) 3 (J)
45 (K)
(130) (I) 401 - 401
Class B Common Stock ($.01 par value) - 3 - 3
Additional paid-in capital 7,787 (J)
120,991 (K)
(140,140) (I)
4,917 (I) 981,904 - 981,904
Notes due on common stock purchases - (30,459) - (30,459)
Retained earnings (distributions in
excess of earnings) (30,252) (M)
103,008 (I) (28,372) - (28,372)
----------- ---------- ------------ -----------
66,229 999,652 - 999,652 (U)
----------- ---------- ------------ -----------
$ (19,831) $2,251,307 $ (340,322) $1,910,985
----------- ---------- ------------ -----------
----------- ---------- ------------ -----------
</TABLE>
7
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(A) Represents AIMCO's unaudited condensed consolidated financial position as of
September 30, 1997, which includes the acquisition of the NHP Real Estate
Companies (including the NHP Real Estate Reorganization) and the NHP
Stock Purchase.
(B) Represents adjustments to reflect (i) the 1997 Dispositions; (ii) the
Windward Acquisition; and (iii) the Tender Offers. The proceeds from the
1997 Dispositions were used to repay indebtedness. The Windward Acquisition
and the Tender Offers were financed with borrowings on the Company's Credit
Facility.
(C) Represents adjustments to reflect the issuance of 7,000,000 shares of AIMCO
Class A Common Stock in the October 1997 Offering, resulting in net proceeds
of $241,480 and the application of such net proceeds (i) to pay $116,100
towards the purchase of the Winthrop Acquisition, with a total purchase
price of $263,500 including $10,000 related to closing and transactions
costs; and (ii) to repay $125,380 of secured short-term financing which
bears interest at a variable rate of LIBOR plus 1.45%. The remainder of the
Winthrop Acquisition will be financed by assuming a mortgage loan in the
amount of $8,345, which bears interest at a rate of 10.04% and matures April
1, 2002, and with borrowings on a mortgage loan of $140,436, including
$1,381 in deferred financing costs, which will bear interest at 7.1% and
mature in 2017.
(D) Represents adjustments to reflect the Foxchase Acquisition, which was
financed with borrowings on the Company's Credit Facility.
8
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(E) Represents the unaudited consolidated financial position of NHP as of
September 30, 1997.
(F) Represents the following adjustments occurring as a result of the Merger:
(i) the issuance of 4,815,918 shares of AIMCO Common Stock, valued at
approximately $128,826 (based on $26.75 per share, the closing sale price on
the NYSE of the AIMCO Common Stock on the date the Letter Agreement was
executed), as Merger Consideration to holders of NHP Common Stock
outstanding as of September 30, 1997 (including 291,240 shares, valued at
$7,790, issued to ANHI and 4,524,701 shares, valued at $121,036, issued to
NHP stockholders); (ii) the additional purchase price consideration of
$4,917 for the Merger resulting from the NHP Stock Options, which vested
upon the consummation of the Stock Purchase and will be converted to options
to purchase shares of AIMCO Common Stock; (iii) the allocation of the
combined purchase price of NHP and the NHP Real Estate Companies based on
the preliminary estimates of relative fair value of the combined assets and
liabilities of NHP and the NHP Real Estate Companies; and (iv) the
elimination of the net assets of WMF as a result of the WMF Spin-Off.
(G) Represents the effects of AIMCO's purchase of NHP immediately after the
Merger. These amounts do not give effect to the NHP Reorganization, which
includes the transfer of certain assets of NHP to the Unconsolidated
Subsidiaries and to the Unconsolidated Partnership. The NHP Reorganization
must occur immediately after the Merger in order for AIMCO to maintain its
qualification as a REIT. This column is included as an intermediate step to
assist the reader in understanding the entire nature of the Merger
transaction. The assets and liabilities of NHP are adjusted to estimated
fair market value, based upon preliminary estimates, which are subject to
change as additional information is obtained. The allocations of purchase
price are subject to final determination based upon estimates and other
evaluations of fair market value; therefore, the amount of goodwill is
subject to change. AIMCO has amortized goodwill associated with the Merger
using the straight-line method over 20 years, which is also preliminary and
is subject to change and could range from five to 20 years.
(H) Represents adjustments related to the NHP Reorganization, whereby AIMCO will
contribute to the combined Unconsolidated Subsidiaries: (i) certain assets
and liabilities of NHP, primarily related to the management operations and
other businesses owned by NHP; and (ii) 16 real estate properties
containing 3,625 apartment units and the related liabilities, and interests
in four real estate partnerships owning four real estate properties
containing 2,836 apartment units. In addition, AIMCO will contribute 12
real estate properties containing 2,905 apartment units to the
Unconsolidated Partnership. The adjustments reflect the transfer of assets
valued at AIMCO's new basis resulting from the allocation of the combined
purchase price of NHP and the NHP Real Estate Companies. AIMCO will receive
notes payable from the Unconsolidated Subsidiaries as consideration for
certain assets sold and will receive equity, in the form of preferred stock
in exchange for certain assets contributed. The businesses of NHP that will
be contributed to and operated by the Unconsolidated Subsidiaries have
goodwill associated with them; therefore, a portion of the goodwill has been
transferred to the Unconsolidated Subsidiaries. The net deferred tax
liability is assumed by the Unconsolidated Subsidiaries as it resulted from
the assets and liabilities transferred to the Unconsolidated Subsidiaries.
(I) On a pro forma basis, AIMCO currently has an investment in NHP Common Stock
of $123,078, comprised of 6,151,049 shares of NHP Common Stock. In
connection with the Merger, (i) AIMCO will issue 291,240 shares of AIMCO
Common Stock valued at $7,790 (based on $26.75 per share, the closing sale
price on the NYSE of the AIMCO Common Stock on the date the Letter Agreement
was executed) and pay cash of $7,791 to acquire 779,073 shares of NHP Common
Stock owned by ANHI; and (ii) AIMCO will issue 4,524,701 shares of AIMCO
Common Stock valued at $121,036 (based on $26.75 per share, the closing sale
price on the NYSE of the AIMCO Common Stock on the date the Letter Agreement
was executed), assuming all NHP stockholders elect to receive Stock
Consideration, to acquire the shares of NHP Common Stock owned by the NHP
stockholders. AIMCO's investment in NHP Common Stock of $259,695, which will
be eliminated upon completion of the Merger, is as follows:
<TABLE>
<S> <C>
Amount of NHP Common Stock at pre-Merger................................................ $ 123,078
Purchase NHP Common Stock from ANHI..................................................... 15,581
Purchase NHP Common Stock from public................................................... 121,036
---------
Total Investment........................................................................ $ 259,695
---------
---------
</TABLE>
9
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
At September 30, 1997, NHP has a deferred tax asset in the amount of
$12,883. In connection with the WMF Spin-Off, the deferred tax asset will be
reduced by $6,000, which relates to net operating loss carryforwards which will
be utilized to reduce taxable gains related to the WMF Spin-Off. The remaining
deferred tax asset of $6,883 was netted against the deferred tax liability of
$15,106, of which the primary component is the difference between the new basis
of the management contracts, as a result of the combined purchase price of NHP
and the NHP Real Estate Companies, and the historical tax basis.
The total purchase price of NHP is $444,643, as follows:
<TABLE>
<S> <C>
Cash paid in the NHP Stock Purchase..................................................... $ 79,640
Issuance of 2,204,221 shares of AIMCO Common Stock in connection with the NHP Stock
Purchase at $26.75 per share.......................................................... 58,962
Issuance of 4,767,365 shares of AIMCO Common Stock in the Merger, at $26.75 per share... 127,527
Cash paid to ANHI as Mixed Consideration in the Merger.................................. 7,791
Assumption of NHP liabilities........................................................... 167,267
Transaction and severance costs......................................................... 5,897
Generation of deferred tax liability.................................................... 8,223
Consideration for NHP Stock Options outstanding......................................... 4,917
Less: Consideration given to ANHI in Merger............................................. (15,581)
---------
Total................................................................................... $ 444,643
---------
---------
</TABLE>
This amount was allocated to the various assets of NHP to be acquired in the
Merger, as follows:
<TABLE>
<S> <C>
Purchase price.......................................................................... $ 444,643
Historical basis of NHP's assets acquired............................................... (204,529)
---------
Step up to record fair value of NHP's assets purchased.................................. $ 240,114
---------
---------
</TABLE>
The step-up was applied to NHP's assets as follows:
<TABLE>
<S> <C>
Real estate............................................................................. $ 18,081
Investment in management contracts...................................................... 115,415
Reduction in value of other assets...................................................... (6,505)
Reclassification of deferred tax asset.................................................. (6,883)
Goodwill................................................................................ 120,006
---------
Total................................................................................... $ 240,114
---------
---------
</TABLE>
Goodwill of $120,006 represents the consideration paid in excess of
identifiable tangible assets and identifiable intangible assets, based on the
preliminary fair market valuation of the tangible and intangible assets,
including businesses owned by NHP that provide (i) group purchasing services;
(ii) comprehensive risk-management and insurance services; (iii) asset
management services; (iv) the origination and underwriting of investments and
long-term asset management services to institutional investors that finance
apartment developments qualifying for the Federal low-income housing tax
credit program; (v) home health care assistance to residents; and (vi) the
placement of insurance coverage for master insurance programs and loss
prevention services.
As of September 30, 1997, NHP's shareholder's equity was $67,514, which is
detailed as follows:
<TABLE>
<S> <C>
Common stock............................................................................ $ 130
Additional paid-in capital.............................................................. 140,140
Retained earnings, of which $28,979 is attributable to WMF.............................. (72,756)
---------
Total shareholders' equity.............................................................. $ 67,514
---------
---------
</TABLE>
Upon completion of the Merger, the entire amount of common stock and
additional paid-in capital is eliminated, along with $103,008 of retained
deficit, representing the total amount of $(72,756), less the $30,252
allocated to WMF.
10
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(J) Represents the issuance of 291,240 shares of AIMCO Common Stock, valued at
approximately $7,790, and borrowings incurred to fund the cash portion of
the Mixed Consideration payable to ANHI of $7,791, in exchange for 779,073
shares of NHP Common Stock owned by ANHI prior to the Merger.
(K) Represents the issuance of 4,524,701 shares of AIMCO Common Stock, valued at
approximately $121,036, to NHP stockholders, in exchange for all of the
shares of NHP Common Stock not owned by AIMCO or ANHI prior to the Merger,
assuming that all NHP stockholders elect to receive Stock Consideration. In
the Merger, NHP stockholders may elect to receive Stock Consideration or
Mixed Consideration. If all NHP stockholders elect to receive Mixed
Consideration, 2,262,351 fewer shares of AIMCO Common Stock would be issued
with a resulting decrease in stockholders' equity of $60,518 and an increase
in unsecured financing of approximately $60,518 (assuming the cash portion
of the Mixed Consideration is financed with additional borrowings.)
(L) Represents the elimination of the accrued liability related to management
contracts acquired in connection with the NHP Real Estate Acquisition.
Subsequent to the Merger, AIMCO will control all parties to the Master
Property Management Agreement and will eliminate such agreement.
(M) Represents the elimination of the net assets of WMF which are being
distributed as a result of the WMF Spin-Off.
(N) Represents the contribution from AIMCO to the Unconsolidated Subsidiaries,
at AIMCO's new basis as a result of the allocation of the combined purchase
prices of NHP and the NHP Real Estate Companies, of 16 real estate
properties containing 3,625 apartment units and the related liabilities, and
the investment in four real estate partnerships owning four real estate
properties containing 2,836 apartment units and the related mortgage notes
payable, which bear interest at 7.98% per annum and mature in four years.
The real estate and the related mortgage notes payable are being contributed
to the Unconsolidated Subsidiaries to reduce future income taxes. In
exchange for such assets, AIMCO will receive notes receivable from the
Unconsolidated Subsidiaries of $55,304 and preferred stock of $30,742.
Certain of the interests in the real estate partnerships contributed to the
Unconsolidated Subsidiaries with a new basis of $22,049 will be controlled
by the Unconsolidated Subsidiaries and, therefore, the assets and
liabilities of such real estate partnerships are consolidated by the
Unconsolidated Subsidiaries. Prior to being contributed to the
Unconsolidated Subsidiaries, such interests in real estate partnerships had
been held by the Unconsolidated Partnership. The remainder of the interests
in real estate partnerships with a new basis of $9,865 will be accounted
for by the Unconsolidated Subsidiaries on the equity method.
(O) Represents the contribution to the Unconsolidated Partnership, at AIMCO's
new basis as a result of the allocation of the combined purchase prices of
NHP and the NHP Real Estate Companies, of the real estate owned by NHP prior
to the Merger, comprised of 12 real estate properties containing 2,905
apartment units.
(P) Represents certain assets and liabilities of NHP, primarily related to the
management operations and other businesses owned by NHP, contributed by
AIMCO to the Unconsolidated Subsidiaries, valued at AIMCO's new basis
resulting from the allocation of the combined purchase price of NHP and the
NHP Real Estate Companies.
(Q) Pursuant to the NHP Reorganization, AIMCO is selling certain net assets to
the Unconsolidated Subsidiaries. In exchange for such assets, AIMCO will
receive a note receivable from the Unconsolidated Subsidiaries. The note
will bear interest at 10% per annum and mature in ten years.
(R) Represents the increase in AIMCO's investment in the Unconsolidated
Subsidiaries to reflect the contribution of the equity in certain assets and
liabilities to the Unconsolidated Subsidiaries.
(S) Represents the contribution to the Unconsolidated Subsidiaries of the
management operations and other businesses of NHP at AIMCO's new basis as a
result of the allocation of the combined purchase prices of NHP and the NHP
Real Estate Companies. The average remaining life of the management
contracts contributed is 15 years.
(T) Represents the contribution of the goodwill related to the management
operations and the service provider businesses of NHP that are being
contributed to, and will be operated by the Unconsolidated Subsidiaries.
(U) Pursuant to the Merger, NHP stockholders may elect to receive Stock
Consideration or Mixed Consideration. If all NHP stockholders elect to
receive Mixed Consideration in the Merger, 2,262,351 fewer shares of AIMCO
Common Stock would be issued with a resulting decrease in stockholders'
equity of $60,518 and an increase in unsecured financing of approximately
$60,518 (assuming the cash portion of the Mixed Consideration is financed
with additional borrowings).
11
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(V) Amount represents notes receivable from the Unconsolidated Subsidiaries of
$95,125, investment in preferred stock of the Unconsolidated Subsidiaries
of $40,855, and retained earnings of $(90). The combined Pro Forma Balance
Sheet of the Unconsolidated Subsidiaries as of September 30, 1997 is
presented below, which reflects the effects of the Merger and the NHP
Reorganization as if such transactions had occurred as of September 30,
1997.
<TABLE>
<CAPTION>
ADJUSTMENTS
---------------------------------------
NHP REOR- PRO FORMA
HISTORICAL (i) MERGER (ii) GANIZATION (iii) TOTAL
------------ ------------ -------------- -----------
<S> <C> <C> <C> <C>
ASSETS
Real estate $45,777 $ - $210,036 (iv) $255,813
Investment in real estate partnerships - - 9,865 (iv) 9,865
Investment in NHP Common Stock 15,491 (15,581) 90 (iv) -
Cash and cash equivalents 5,115 7,791 2,558 (iv)
3,239 (v) 18,703
Restricted cash 1,592 - 3,978 (iv) 5,570
Investment in management
contracts 124 - 53,534 (v) 53,658
Goodwill - - 53,147 (v) 53,147
Deferred financing costs 541 - 1,173 (iv) 1,714
Investment in parent - 7,790 7,790
Other assets 341 - 494 (iv)
49,077 (v) 49,912
------------ ------------ -------------- -----------
$68,981 $ - $387,191 $456,172
------------ ------------ -------------- -----------
------------ ------------ -------------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Mortgage and other notes payable $25,399 $ - $136,996 (iv) $162,395
Secured short-term financing - - 13,705 (iv) 13,705
Notes payable to AIMCO - - 55,125 (iv)(vi)
40,000 (v) (vi) 95,125
Unsecured short-term financing - - 62,138 (v) (vii) 62,138
Accounts payable and
other liabilities 1,438 - 13,675 (iv)
21,439 (v) 36,552
Other long-term liabilities - - 9,592 (v) 9,592
Deferred tax liability - - 8,223 (v) (viii) 8,223
------------ ------------ -------------- -----------
26,837 - 360,893 387,730
Minority interest in consolidated
partnerships 22,274 - (22,049) (iv) (ix) 225
Preferred stock 19,960 - 30,742 (iv)
17,605 (v) 68,307
Common stock 2,000 - - 2,000
Retained earnings (2,090) - - (2,090)
------------ ------------ -------------- -----------
19,870 - 48,347 68,217
------------ ------------ -------------- -----------
$68,981 $ - $387,191 $456,172
------------ ------------ -------------- -----------
------------ ------------ -------------- -----------
</TABLE>
(i) Represents the combined unaudited Unconsolidated Subsidiaries'
consolidated financial position as of September 30, 1997.
(ii) In connection with the Merger, AIMCO will acquire all of the
outstanding shares of NHP Common Stock, including shares owned by ANHI.
ANHI will elect to receive Mixed Consideration of 291,240 shares of
AIMCO Common Stock valued at approximately $7,790 (based on $26.75 per
share, the market price per share of AIMCO Common Stock on the date the
Letter Agreement was executed) and cash of $7,791 in exchange for the
779,073 shares of NHP Common Stock owned by ANHI.
(iii) Represents adjustments related to the NHP Reorganization, whereby
AIMCO will contribute or sell to the combined Unconsolidated
Subsidiaries: (i) certain assets and liabilities of NHP, primarily
related to the management operations and
12
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
other businesses owned by NHP; and (ii) 16 real estate properties
containing 3,625 apartment units and the related liabilities, and
interests in four real estate partnerships owning four real estate
properties containing 2,836 apartment units. In addition, AIMCO will
contribute 12 real estate properties containing 2,905 apartment
units to the Unconsolidated Partnership. The adjustments reflect the
transfer of assets valued at AIMCO's new basis resulting from the
allocation of the combined purchase price of NHP and the NHP Real
Estate Companies. AIMCO will receive notes payable from the
Unconsolidated Subsidiaries as consideration for certain assets sold
and will receive equity, in the form of preferred stock in exchange for
certain assets contributed. The businesses of NHP that will be
contributed to and operated by the Unconsolidated Subsidiaries have
goodwill associated with them; therefore, a portion of the goodwill has
been transferred to the Unconsolidated Subsidiaries. The net deferred
tax liability is assumed by the Unconsolidated Subsidiaries as it
resulted from the assets and liabilities transferred to the
Unconsolidated Subsidiaries.
(iv) Represents the contribution from AIMCO to the Unconsolidated
Subsidiaries, at AIMCO's new basis as a result of the allocation of the
combined purchase prices of NHP and the NHP Real Estate Companies, of
sixteen real estate properties containing 3,625 apartment units and the
related liabilities, and interests in four real estate partnerships
owning four real estate properties containing 2,836 apartment units and
the related mortgage notes payable, which bear interest at 7.98% per
annum and mature in four years. The real estate and the related
mortgage note payable are being contributed to the Unconsolidated
Subsidiaries to reduce the income tax provision. In exchange for such
assets, AIMCO will receive notes receivable from the Unconsolidated
Subsidiaries of $55,304 and preferred stock of $30,742. Certain of the
interests in the real estate partnerships contributed to the
Unconsolidated Subsidiaries with a new basis of $210,036 will be
controlled by the Unconsolidated Subsidiaries and, therefore, the
assets and liabilities of such real estate partnerships are
consolidated by the Unconsolidated Subsidiaries. Prior to being
contributed to the Unconsolidated Subsidiaries, such interests in real
estate partnerships had been held by the Unconsolidated Partnership.
The remainder of the interests in the real estate partnerships with a
new basis of $9,865 will be accounted for by the Unconsolidated
Subsidiaries on the equity method.
(v) Represents certain assets and liabilities of NHP, primarily related to
the management operations and other businesses owned by NHP,
contributed by AIMCO to the Unconsolidated Subsidiaries, valued at
AIMCO's new basis resulting from the allocation of the combined
purchase price of NHP and the NHP Real Estate Companies.
(vi) Represents notes payable to AIMCO in exchange for certain of the
assets sold to the Unconsolidated Subsidiaries as part of the NHP
Reorganization. The notes bear interest at 10% per annum and have an
average life of ten years.
(vii) Represents the contribution of the NHP unsecured line of credit at
September 30, 1997 to the Unconsolidated Subsidiaries as part of the
NHP Reorganization. The NHP unsecured line of credit bears interest at
a floating rate of LIBOR plus 0.75% per annum (6.4% at September 30,
1997) and has a remaining life of one year.
(viii) Represents the establishment of the estimated net deferred federal and
state tax liabilities at a combined rate of 40% for the estimated
difference between the book and tax basis of the net assets (other than
goodwill) of the Unconsolidated Subsidiaries. The primary component of
the deferred tax liability is the difference between the new basis of
the management contracts, as a result of the allocation of the combined
purchase price of NHP and the NHP Real Estate Companies, and the
historical tax basis.
(ix) Represents adjustment to eliminate the minority interest in one real
estate partnership which owns 14 real estate properties. Prior
to the Merger, the Unconsolidated Subsidiaries owned the general
partnership interests in the real estate partnership and AIMCO owned
virtually all of the limited partnership interests. Pursuant to the
NHP Reorganization, AIMCO has contributed its limited partnership
interests to the Unconsolidated Subsidiaries, resulting in the
Unconsolidated Subsidiaries owning 99% of the real estate partnership.
13
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
October 1997
Offering & NHP Real
AIMCO Winthrop Estate
Historical (A) Adjustments (B) Acquisition (C) Acquisition (D)
---------------- ------------------ ----------------- ----------------
<S> <C> <C> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $100,516 $ 87,738 (I) $48,771 $ 15,852
Property operating expenses (38,400) (49,588) (I) (21,896) (8,839)
Owned property management expense (2,746) (2,978) (I) (2,313) (658)
---------------- ------------------ ----------------- ----------------
Income from property operations
before depreciation 59,370 35,172 24,562 6,355
Depreciation (19,556) (16,565) (I) (9,223) (2,908)
---------------- ------------------ ----------------- ----------------
Income from property operations 39,814 18,607 15,339 3,447
---------------- ------------------ ----------------- ----------------
SERVICE COMPANY BUSINESS
Management fees and other income 8,367 1,962 (J) - 7,173
Management and other expenses (5,352) (1,254) (J) - (6,956)
Corporate overhead allocation (590) - - -
Amortization of management company
goodwill and other assets
depreciation and amortization (718) (508) (K) - -
---------------- ------------------ ----------------- ----------------
Income from service company business 1,707 200 - 217
Minority interest in service company
business 10 - - -
---------------- ------------------ ----------------- ----------------
Company's share of income from
service company business 1,717 200 - 217
---------------- ------------------ ----------------- ----------------
General and administrative expenses (1,512) - - -
Interest expense (24,802) (10,536) (L) (3,174) (11,978)(P)
Interest income 523 - - 2,000
---------------- ------------------ ----------------- ----------------
Income before equity in earnings of
unconsolidated subsidiaries,
gain on disposition of property,
income tax provision and
minority interests 15,740 8,271 12,165 (6,314)
Equity in earnings of unconsolidated
subsidiaries - - - -
Equity in losses of partnerships - (169) (M) - (8,272)
Gain on disposition of property 44 (44) (I) - -
Income tax provision - - - -
---------------- ------------------ ----------------- ----------------
Income before minority interests 15,784 8,058 12,165 (14,586)
Minority Interest in other partnerships (111) 4,560 (N) - 254
---------------- ------------------ ----------------- ----------------
Income before minority interests in
Operating Partnership 15,673 12,618 12,165 (14,332)
Income tax provision - - - -
Minority interest in Operating
Partnership (2,689) (2,694) (EE) (803) (EE) -
---------------- ------------------ ----------------- ----------------
Net income (loss) $12,984 $ 9,924 $11,362 $(14,332)
---------------- ------------------ ----------------- ----------------
---------------- ------------------ ----------------- ----------------
Net income allocable to preferred
stockholder $ -
----------------
----------------
Net income allocable to common
stockholders $12,984
----------------
----------------
Net income per common share (HH) $1.04
----------------
----------------
Weighted average number of common
shares and common share equivalents 12,427
outstanding
----------------
----------------
Foxchase NHP Merger NHP Pro Forma
Acquisition (E) Historical (F) Adjustments (G) Reorganization (H) Total
---------------- ----------------- ------------------ ------------------ ---------
<S> <C> <C> <C> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $ 18,601 $ - $11,002 (P) $(34,387) (V)
(11,002) (W) $237,091
Property operating expenses (7,534) - (5,937) (P) 15,075 (V)
5,937 (W) (111,182)
Owned property management expense (906) - (853) (P) 1,556 (V)
853 (W)
473 (X) (7,572)
---------------- ----------------- -------------------- -------------- ----------
Income from property operations
before depreciation 10,161 - 4,212 (21,495) 118,337
Depreciation (3,859) - (3,741) (P) 7,355 (V)
3,741 (W) (44,756)
---------------- ----------------- -------------------- -------------- ----------
Income from property operations 6,302 - 471 (10,399) 73,581
---------------- ----------------- -------------------- -------------- ----------
SERVICE COMPANY BUSINESS
Management fees and other income - 194,979 (127,266) (Q) (65,429) (Y)
(1,851) (X) 17,935
Management and other expenses - (153,907) 127,266 (Q) 15,274 (Y)
9,654 (R) 250 (Z) (15,025)
Corporate overhead allocation - - - - (590)
Amortization of management company
goodwill and other assets
depreciation and amortization - (6,321) (4,955) (S) 11,028 (Y) (1,474)
---------------- ----------------- -------------------- -------------- ----------
Income from service company business - 34,751 4,699 (40,728) 846
Minority interest in service company
business - - - - 10
---------------- ----------------- -------------------- -------------- ----------
Company's share of income from
service company business - 34,751 4,699 (40,728) 856
---------------- ----------------- -------------------- -------------- ----------
General and administrative expenses - (14,074) - 14,074 (Y)
756 (Z) (756)
Interest expense (6,229) (3,982) (4,082) (P) 3,982 (Y)
(560) (T) 14,069 (V)
4,082 (W) (43,210)(FF)
Interest income - 747 - (747) (Y)
275 (AA)
200 (BB) 2,998
---------------- ----------------- -------------------- -------------- ----------
Income before equity in earnings of
unconsolidated subsidiaries,
gain on disposition of property,
income tax provision and
minority interests 73 17,442 528 (14,436) 33,469
Equity in earnings of unconsolidated
subsidiaries - - - 5,076 (CC)
3,800 (DD)
5,238 (DD) 14,114 (II)
Equity in losses of partnerships (80) - (6,016) (U) 1,077 (V)
(3,508 (W)
1,378 (X) (15,590)
Gain on disposition of property - - - - -
Income tax provision - - - - -
---------------- ----------------- -------------------- -------------- ----------
Income before minority interests (7) 17,442 (5,488) (1,375) 31,993
Minority Interest in other partnerships - - 11 (P) (1,111) (V) 3,603
---------------- ----------------- -------------------- -------------- ----------
Income before minority interests in
Operating Partnership (7) 17,442 (5,477) (2,486) 35,596
Income tax provision - (6,977) - 6,977 (Y) -
Minority interest in Operating
Partnership 2,437 (EE) - (22) (EE) (690)(EE) (4,461)
---------------- ----------------- -------------------- -------------- ----------
Net income (loss) $ 2,430 $ 10,465 $(5,499) $ 3,801 $31,135 (FF)
---------------- ----------------- -------------------- -------------- ----------
---------------- ----------------- -------------------- -------------- ----------
Net income allocable to preferred
stockholder $ 5,344 (GG)
----------
----------
Net income allocable to common
stockholders $25,791 (FF)
----------
----------
Net income per common share (HH) $ 0.67 (FF)
----------
----------
Weighted average number of common
shares and common share equivalents 38,686 (FF)
outstanding ----------
----------
</TABLE>
The pro forma statement above is presented assuming all NHP stockholders
(other than ANHI) elect to receive Stock Consideration. See note (FF) for the
effect on the pro forma statement if all NHP stockholders elect to receive
Mixed Consideration.
- ------------------------------
(A) Represents AIMCO's audited consolidated results of operations for the year
ended December 31, 1996.
14
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(B) Represents adjustments to reflect the following as if they had occurred on
January 1, 1996: (i) the Recent Property Acquisitions; (ii) the November
1996 Stock Offering; (iii) the February 1997 Stock Offering; (iv) the May
1997 Stock Offering; (v) the August 1997 Stock Offering; (vi) the
Preferred Stock Offering; (vii) the September 1997 Stock Offerings;
(viii) the ANHI Dividend; (ix) the Ambassador Stock Acquisition; (x) the
Loan Acquisitions; (xi) the Land Lease Acquisitions; (xii) the Property
Loan Payment; (xiii) the Sawgrass Acquisition; (xiv) the Morton Towers
Acquisition; (xv) the Los Arboles Acquisition; (xvi) the Windward
Acquisition; (xvii) the Tender Offers; (xviii) the 1997 Dispositions;
(xix) the 1996 Acquisitions; (xx) the 1996 Dispositions; and (xxi) the
Management Company Acquisition.
(C) Represents adjustments to reflect the October 1997 Offering and Winthrop
Acquisition as if they had occurred on January 1, 1996.
(D) Represents adjustments to reflect the acquisition of the NHP Real Estate
Companies as if it had occurred on January 1, 1996. The historical financial
statements of the NHP Real Estate Companies consolidate certain real estate
partnerships in which they have an interest that will be presented on the
equity method by AIMCO, as a result of the NHP Real Estate Reorganization.
If AIMCO is not in a position to control the partnership or the real estate
assets owned by any partnership in which it has an interest, such
partnership is not consolidated. Factors which preclude control include, but
are not limited to, not controlling a majority of the general partner
interest, and not owning sufficient interest to control the partnership when
there exists the presence of significant limited partner rights, including
the right to vote on a sale of real estate owned by the partnership or the
refinancing of debt. As a part of the NHP Real Estate Reorganization, AIMCO
transferred its ownership interests in certain partnerships to an
unconsolidated subsidiary or partnership in which AIMCO does not exercise
control; therefore, AIMCO does not consolidate such partnerships. In
addition, represents adjustments to record additional depreciation and
amortization related to the increased basis in the assets of the NHP Real
Estate Companies as a result of the allocation of the purchase price of the
NHP Real Estate Companies and additional interest expense incurred in
connection with borrowings incurred by AIMCO to consummate the NHP Real
Estate Acquisition.
(E) Represents adjustments to reflect the Foxchase Acquisition as if it had
occurred on January 1, 1996.
(F) Represents the audited consolidated results of operations of NHP for the
year ended December 31, 1996, which have been restated to reflect WMF as a
discontinued operation as a result of the Rights Distribution.
(G) Represents the following adjustments occurring as a result of the Merger:
(i) the reclassification of NHP's real estate held for sale to real
estate held for investment; (ii) the offsetting of on-site personnel and
general and administrative cost reimbursement against the related
revenue; (iii) the reduction in personnel costs, primarily severance
costs, pursuant to a restructuring plan; (iv) the incremental
amortization of the purchase price adjustment related to the management
contracts, furniture, fixtures and equipment, and goodwill; and (v) the
amortization of the increased basis in investments in real estate
partnerships based on the purchase price adjustment related to the real
estate and an estimated average life of 17.5 years.
(H) Represents adjustments related to the NHP Reorganization, whereby AIMCO will
contribute to the combined Unconsolidated Subsidiaries: (i) certain assets
and liabilities of NHP, primarily related to the management operations and
other businesses owned by NHP; and (ii) 16 real estate properties
containing 3,625 apartment units and the related liabilities, and interests
in four real estate partnerships owning four real estate properties
containing 2,836 apartment units. In addition, AIMCO will contribute 12
real estate properties containing 2,905 apartment units to the
Unconsolidated Partnership. The adjustments represent (i) the related
revenues and expenses primarily related to the management operations and
other businesses owned by NHP; and (ii) the historical results of operations
of such real estate properties and interests in such real estate
partnerships contributed, with additional depreciation and amortization
recorded related to AIMCO's new basis resulting from the allocation of the
combined purchase price of NHP and the NHP Real Estate Companies.
(I) Represents the pro forma operating results of the 1996 Acquisitions, the
Recent Property Acquisitions, the Sawgrass Acquisition, the Morton Towers
Acquisition, the Los Arboles Acquisition, the Windward Acquisition and the
Tender Offers, less the operating results for the 1996 Dispositions and
the 1997 Dispositions. These pro forma operating results are based on
historical results of the properties, except depreciation, which is based
on AIMCO's investment in the properties.
(J) Represents the pro forma operating results of the management companies
acquired by AIMCO since January 1, 1996. These pro forma operating results
are based on historical results of the management companies; however, they
have been adjusted to eliminate management fee income earned by the
respective management companies from the properties which are consolidated.
(K) Represents amortization of the intangible assets related to management
contracts acquired in the Management Company Acquisition. Management
contracts are amortized using the straight-line method over the terms of the
related management contracts.
15
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(L) Represents adjustments to interest expense for the following:
<TABLE>
<S> <C>
Borrowings on AIMCO's Credit Facility and other loans and mortgages assumed in connection with
the 1996 Acquisitions......................................................................... $ (16,887)
Borrowings on AIMCO's Credit Facility and other loans and mortgages assumed in connection with
the Recent Property Acquisitions.............................................................. (8,192)
Borrowings on AIMCO's new secured short-term financing in connection with the Sawgrass
Acquisition................................................................................... (898)
Borrowings on AIMCO's Credit Facility in connection with the Los Arboles Acquisition............ (897)
Borrowings on AIMCO's Credit Facility in connection with the Morton Towers Acquisition.......... (360)
Borrowings on AIMCO's Credit Facility in connection with the Land Lease Acquisitions............ (1,440)
Borrowings on AIMCO's Credit Facility in connection with the Loan Acquisitions.................. (3,795)
Borrowings on AIMCO's Credit Facility in connection with the Ambassador Stock Acquisition....... (1,431)
Borrowings on AIMCO's Credit Facility in connection with the Windward Acquisition................ (777)
Borrowings on AIMCO's Credit Facility in connection with the Tender Offers...................... (3,311)
Reduction in interest for the payment of loans in connection with the Loan Acquisitions and the
Property Loan Payment......................................................................... 3,327
Repayments on AIMCO's Credit Facility and other indebtedness with proceeds from the 1996
Dispositions, the 1997 Dispositions, the November 1996 Stock Offering, the February 1997 Stock
Offering, the May 1997 Stock Offering, the Preferred Stock Offering, the September 1997 Stock
Offerings..................................................................................... 21,390
Repayments on AIMCO's Credit Facility with proceeds from the ANHI Dividend...................... 2,735
---------
$ (10,536)
---------
---------
</TABLE>
(M) Represents adjustments related to the Tender Offers to eliminate the
historical equity in earnings of unconsolidated partnerships.
(N) Represents the minority interest in consolidated real estate partnerships.
(O) Represents (i) historical interest of the NHP Real Estate Companies of
$10,400; (ii) interest of $4,016 related to borrowings on AIMCO's Credit
Facility of $55,807 to finance the NHP Real Estate Acquisition; offset by
(iii) a decrease in interest of $2,438 related to the presentation of
certain real estate partnerships on the equity method.
(P) Represents the operating results of real estate held for investment by
AIMCO, which was classified as real estate held for sale by NHP prior to
the Initial NHP Stock Purchase.
(Q) Represents the offsetting of on-site personnel and general and
administrative cost reimbursement against the related revenue.
(R) Represents a reduction in personnel costs, primarily severance costs,
pursuant to a restructuring plan, approved by AIMCO senior management,
specifically identifying all significant actions to be taken to complete
the restructuring plan, assuming that the Merger had occurred on
January 1, 1996 and that the restructuring plan was completed on
January 1, 1996.
(S) Represents incremental depreciation and amortization of the tangible and
intangible assets related to the property management and other business
operated by the Unconsolidated Subsidiaries, based on AIMCO's new basis
as adjusted by the allocation of the combined purchase price of NHP and
the NHP Real Estate Companies, including amortization of management
contracts of $3,702, depreciation of furniture, fixtures and equipment
of $1,302 and amortization of goodwill of $6,272, less NHP's historical
depreciation and amortization of $6,321. Management contracts are
amortized using the straight-line method over the weighted average life
of the contracts estimated to be 15 years. Furniture, fixtures and
equipment are depreciated using the straight-line method over the
estimated life of 5 years. Goodwill is amortized using the straight-line
method over 20 years. The allocation of the purchase price of NHP is
preliminary; therefore, the amount and life of goodwill are subject to
change as additional information is obtained and the purchase price
allocation is finalized. The expected life of goodwill will depend upon
the final valuation of the various intangible assets, which could range
from five years to 20 years. If the estimated life of goodwill is
ultimately determined to be five years, goodwill amortization would be
$23,770 net income applicable to common shareholders would be $13,763
and net income per common share would be $0.36.
(T) Represents the interest related to the indebtedness of $7,791 incurred to
finance the cash portion of the Merger Consideration to ANHI. The
borrowings were made under AIMCO's Credit Facility, which bears interest
at LIBOR plus 1.70% per annum.
(U) Represents adjustment for amortization of the increased basis in
investments in real estate partnerships, as a result of the allocation
of the combined purchase price of NHP and the NHP Real Estate Companies,
based on an estimated average life of 17.5 years.
(V) Represents the results of operations of real estate contributed to the
Unconsolidated Subsidiaries, including 16 real estate properties
containing 3,625 apartment units and interests in four real estate
partnerships owning four real estate properties containing 2,836
apartment units.
(W) Represents the contribution of NHP's 12 real estate properties
containing 2,905 apartment units to the Unconsolidated Partnership pursuant
to the NHP Reorganization.
(X) Represents the elimination of the income generated by the management
contracts which are related to the interests in real estate partnerships
owned by AIMCO or the Unconsolidated Partnership.
(Y) Represents the historical income and expenses associated with certain
assets and liabilities of NHP that will be contributed to the
Unconsolidated Subsidiaries, primarily related to the management
operations and other businesses owned by NHP.
(Z) Represents adjustments for management costs that will be incurred by the
Unconsolidated Subsidiaries rather than by AIMCO, primarily related to
personnel costs, for work performed on the businesses contributed to
held by the Unconsolidated Subsidiaries.
(AA) Represents the interest income of $5,513 earned on notes receivable of
$55,304 received as consideration for certain real estate assets and
liabilities and interests in certain real estate partnerships sold to the
Unconsolidated Subsidiaries by AIMCO, net of the elimination of AIMCO's
share of the related interest expense of $5,238 reflected in the equity in
earnings of ANHI's operating results.
(BB) Represents interest income of $4,000 earned on the notes receivable from
the Unconsolidated Subsidiaries, after elimination of AIMCO's share of
$3,800 of the related interest expense.
(CC) Represents adjustment to AIMCO's equity in earnings of the Unconsolidated
Subsidiaries on a post-Merger basis, before elimination of interest expense
on notes receivable from the Unconsolidated Subsidiaries.
(DD) Represents elimination of AIMCO's share of the related interest expense
reflected in the equity in earnings of ANHI's operating results.
16
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(EE) Represents adjustments to minority interest in the Operating Partnership
assuming the Recent Property Acquisitions, the November 1996 Stock
Offering, the February 1997 Stock Offering, the May 1997 Stock Offering,
the July 1997 Stock Sale, the Preferred Stock Offering, the August 1997
Stock Offering, the September 1997 Stock Offerings, the ANHI Dividend,
the Ambassador Stock Acquisition, the Loan Acquisitions, the Land Lease
Acquisitions, the Property Loan Payment, the Sawgrass Acquisition, the
Morton Towers Acquisition, the Los Arboles Acquisition, the Windward
Acquisition, the Tender Offers, the 1996 Acquisitions, the 1996
Dispositions, the 1997 Dispositions, the Management Company Acquisition,
the October 1997 Offering and Winthrop Acquisition, the NHP Stock
Purchase, the NHP Real Estate Acquisition and the Merger had occurred as
of January 1, 1996. On a pro forma basis, without giving effect to the
NHP Stock Purchase, the NHP Real Estate Acquisition and the Merger, as
of December 31, 1996, the minority interest percentage is approximately
15.0%. On a pro forma basis, giving effect to the NHP Stock Purchase and
the NHP Real Estate Acquisition but without giving effect to the Merger,
as of December 31, 1996, the minority interest percentage is
approximately 14.2%. On a pro forma basis, giving effect to the Merger,
as of December 31, 1996, the minority interest percentage is
approximately 12.5%, assuming that ANHI elects Mixed Consideration and
all other NHP stockholders elect Stock Consideration.
(FF) Pursuant to the Merger, NHP stockholders may elect to receive Stock
Consideration or Mixed Consideration. Set forth below is a summary of
the pro forma net income applicable to holders of AIMCO Common Stock and
net income per common share (i) assuming that ANHI elects Mixed
Consideration and all other NHP stockholders, excluding AIMCO, elect to
receive Stock Consideration (Stock Consideration); and (ii) assuming all
NHP stockholders, excluding AIMCO but including ANHI, elect to receive
Mixed Consideration (Mixed Consideration). The detail below assumes an
average interest rate of 7.19% per annum (representing LIBOR plus 1.70%,
the current rate under AIMCO's unsecured credit facility) on the
additional borrowings of $60,518.
<TABLE>
<CAPTION>
STOCK MIXED
CONSIDERATION CONSIDERATION
------------- -------------
<S> <C> <C>
Increase in interest expense........................................ $ -- $ 4,350
------------- -------------
------------- -------------
Income before minority interest in Operating Partnership (after
minority interest in other partnerships).......................... $ 35,596 $ 31,246
Minority interest in Operating Partnership.......................... (4,461) (4,127)
------------- -------------
Net income.......................................................... $ 31,135 $ 27,119
------------- -------------
------------- -------------
Net income attributable to common stockholders...................... $ 25,791 $ 21,775
------------- -------------
------------- -------------
Net income per share................................................ $ 0.67 $ 0.60
------------- -------------
------------- -------------
Minority interest percentage........................................ 12.53% 13.21%
------------- -------------
------------- -------------
Number of common shares and common share equivalents................ 38,686 36,424
------------- -------------
------------- -------------
</TABLE>
Additionally, the following table presents the net impact to pro forma
net income applicable to holders of AIMCO Common Stock and net income per
common share assuming the interest rate increases by 0.25%.
<TABLE>
<CAPTION>
STOCK MIXED
CONSIDERATION CONSIDERATION
------------- -------------
<S> <C> <C>
Increase in interest expense........................................ $ -- $ 4,936
------------- -------------
------------- -------------
Income before minority interest in Operating Partnership (after
minority interest in other partnerships).......................... $ 35,162 $ 30,660
Minority interest in Operating Partnership.......................... (4,406) (4,050)
------------- -------------
Net income.......................................................... $ 30,756 $ 26,610
------------- -------------
------------- -------------
Net income attributable to common stockholders...................... $ 25,412 $ 21,226
------------- -------------
------------- -------------
Net income per share................................................ $ 0.66 $ 0.58
------------- -------------
------------- -------------
Minority interest percentage........................................ 12.53% 13.21%
------------- -------------
------------- -------------
Number of common shares and common share equivalents................ 38,686 36,424
------------- -------------
------------- -------------
</TABLE>
(GG) Represents net income allocable to holders of the AIMCO Class B Preferred
Stock as if the Preferred Stock Offering had occurred on January 1, 1996.
(HH) In February 1997, the Financial Accounting Standards Board issued Statement
128 which specifies the computation, presentation and disclosure
requirements for basic earnings per share and diluted earnings per share.
AIMCO's management believes that adoption of Statement 128 will not have a
material effect on the earnings per share of AIMCO.
17
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(II) Amount represents (i) AIMCO's equity in earnings in the Unconsolidated
Subsidiaries' operating results of $2,007, detailed below; and (ii) the
elimination of AIMCO's share of $9,038 of the interest expense reflected
in the equity in earnings ANHI. The combined Pro Forma Statement of
Operations of the Unconsolidated Subsidiaries for the year ended
December 31, 1996 is presented below, which is based on a series of
transactions, including the Initial NHP Stock Purchase, resulting in
ANHI owning 51.3% of NHP, the ANHI Stock Transfers, resulting in ANHI
owning 6.03% of NHP, and the contribution, from AIMCO to one of the
Unconsolidated Subsidiaries, of the general partnership interest, and
therefore controlling interest, in one real estate partnership (the
"Consolidated Real Estate Partnership"), owning 14 real estate
properties with 2,725 apartment units. Interests held by limited
partners in the real estate partnerships controlled by the
Unconsolidated Subsidiary are reflected as minority interest in
consolidated partnerships.
<TABLE>
<CAPTION>
CONTRIBUTE
NHP STOCK NHP ANHI STOCK REAL
PURCHASE(i) HISTORICAL(ii) ADJUSTMENTS(iii) TRANSFERS(iv) ESTATE(v)
----------- -------------- ---------------- ------------- ----------
<S> <C> <C> <C> <C> <C>
RENTAL PROPERTY
OPERATIONS
Rental and other property
revenues............... $-- $ -- $ 11,002(viii) $(11,002) $12,777
Property operating
expenses............... -- -- (5,937)(viii) 5,937 (8,665)
Owned property management
expense................ -- -- (853)(viii) 853 (613)
----------- -------------- ------------------ ------------- ----------
Income from property
operations before
depreciation........... -- -- 4,212 (4,212) 3,499
Depreciation............. -- -- (3,108)(viii) 3,108 (1,588)
----------- -------------- ------------------ ------------- ----------
Income from property
operations............. -- -- 1,104 (1,104) 1,911
----------- -------------- ------------------ ------------- ----------
Management fees and other
income................. -- 194,979 (127,266)(ix) (67,713) --
Management and other
expenses............... -- (153,907) 127,266(ix) 16,987 --
9,654(x)
Amortization of
management contracts
and goodwill and
depreciation and
amortization of other
assets................. -- (6,321) (3,660)(xi) 9,981 (41)
----------- -------------- ------------------ ------------- ----------
-- 34,751 5,994 (40,745) (41)
----------- -------------- ------------------ ------------- ----------
General and
administrative......... -- (14,074) -- 14,074 --
Interest expense......... (5,932) (3,982) (4,082)(viii) 13,996 (2,640)
Interest income.......... -- 747 -- (747) --
----------- -------------- ------------------ ------------- ----------
Income before income
taxes, equity in
earnings and minority
interests.............. (5,932) 17,442 3,016 (14,526) (770)
Income tax provision..... -- (6,977) (135)(xii) 7,112 --
(249)(xv)
Equity in earnings of
NHP.................... -- -- (3,086)(xiii) 3,717(xvi) --
Equity in losses of
unconsolidated
partnerships -- -- -- -- --
Minority interest in
NHP.................... -- -- (3,652)(xiv) 3,652 --
Minority interest in
partnerships........... -- -- 11(viii) (11) 762
----------- -------------- ------------------ ------------- ----------
Net income............... $(5,932) $ 10,465 $ (3,846) $ (305) $ (8)
----------- -------------- ------------------ ------------- ----------
----------- -------------- ------------------ ------------- ----------
Income attributable to
preferred
stockholder............
Income attributable to
common stockholder.....
ADJUSTMENTS
-----------------------------------
NHP PRO FORMA
MERGER(vi) REORGANIZATION(vii) TOTAL
---------- ---------------------- ----------
<S> <C> <C> <C>
RENTAL PROPERTY
OPERATIONS
Rental and other property
revenues............... $ -- $ 34,387(xvii) $ 47,164
Property operating
expenses............... -- (15,075)(xvii) (23,740)
Owned property management
expense................ -- (1,556)(xvii) (2,169)
----- -------- ---------
Income from property
operations before
depreciation........... -- 17,756 21,255
Depreciation............. -- (7,355)(xvii) (8,943)
----- -------- ---------
Income from property
operations............. -- 10,401 12,312
----- -------- ---------
Management fees and other
income................. -- 65,429(xviii) 65,429
Management and other
expenses............... -- (15,524)(xviii) (15,524)
Amortization of
management contracts
and goodwill and
depreciation and
amortization of other
assets................. -- (11,028)(xviii) (11,069)(xxii)
----- -------- ---------
-- 38,877 38,836
----- -------- ---------
General and
administrative......... -- (14,830)(xviii) (14,830)
Interest expense......... -- (3,982)(xviii) (26,274)
(10,122)(xvii)
(4,000)(xix)
(5,530)(xix)
Interest income.......... -- 747(xviii) 747
----- -------- ---------
Income before income
taxes, equity in
earnings and minority
interests.............. -- 11,561 10,791
Income tax provision..... -- (4,675)(xx) (4,924)
Equity in earnings of
NHP.................... (631) -- --
Equity in losses of
unconsolidated partnerships -- (530)(xviii) (530)
Minority interest in
NHP.................... -- --
Minority interest in
partnerships........... -- (754)(xxi) 8
----- -------- ---------
Net income............... $(631) $ 5,602 $ 5,345
----- -------- ---------
----- -------- ---------
Income attributable to
preferred
stockholder............ $ 5,078
---------
---------
Income attributable to
common stockholder..... $ 267
---------
---------
</TABLE>
-----------------------------------
(i) Represents interest expense related to indebtedness of $72,765
(including deferred financing costs) incurred pursuant to the ANHI
Credit Facility to finance the cash portion of the Initial NHP Stock
Purchase.
18
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(ii) Represents the historical operating results of NHP for the year
ended December 31, 1996, which have been restated to reflect WMF
as a discontinued operation as a result of the Rights Distribution.
(iii) Represents adjustments for the following: (i) operating results of
the real estate held for investment, which was held for sale by NHP;
(ii) an adjustment to offset on-site personnel and general and
administrative cost reimbursement against the related revenue; (iii)
a reduction in personnel costs pursuant to a restructuring plan;
(iv) incremental depreciation and amortization resulting from
stating the tangible and intangible assets related to the property
management and other businesses operated by ANHI at their respective
fair values; (v) adjustment to the estimated Federal and state tax
provisions; and (vi) the allocation of 48.7% of NHP's income owned
by other stockholders to minority interest.
(iv) Represents the sale of 5,717,000 shares of NHP Common Stock to AIMCO
reducing ANHI's ownership of NHP Common Stock from 51.3% to 6.03%;
therefore, ANHI will account for its investment in NHP on the equity
method.
(v) Represents the results of operations of the Consolidated Real Estate
Partnership as if the contribution of the general partnership
interest from AIMCO to the Unconsolidated Subsidiary had occurred
on January 1, 1996.
(vi) Represents adjustments for the Merger. Subsequent to the Merger,
all of the outstanding shares of NHP Common Stock will be owned by
AIMCO.
(vii) Represents adjustments related to the NHP Reorganization, whereby
AIMCO will contribute to the combined Unconsolidated
Subsidiaries: (i) certain assets and liabilities of NHP,
primarily related to the management operations and other
businesses owned by NHP; and (ii) 16 real estate properties
containing 3,625 apartment units and the related liabilities, and
interests in four real estate partnerships owning four real
estate properties containing 2,836 apartment units. Adjustments
reflect (a) income and expenses associated with certain assets
and liabilities of NHP that will be contributed to the
Unconsolidated Subsidiaries, primarily related to the management
operations and other businesses owned by NHP; (b) adjustments for
management costs that will be incurred by the Unconsolidated
Subsidiaries rather than by AIMCO, primarily related to personnel
costs, for work performed on the businesses contributed to the
Unconsolidated Subsidiaries; (c) depreciation and amortization of
the tangible and intangible assets related to the management
operations and other business contributed to the Unconsolidated
Subsidiaries; (d) interest expense associated with NHP's
historical notes payable and on the notes payable to AIMCO; (e)
historical interest income of NHP; (f) income tax provision; and
(g) the historical results of operations of real estate
properties and interests in real estate partnerships contributed,
with additional depreciation and amortization recorded related to
AIMCO's new basis resulting from the allocation of the combined
purchase price of NHP and the NHP Real Estate Companies.
(viii) Represents the operating results of the real estate held for
investment by AIMCO, which was previously held for sale by NHP.
(ix) Represents an adjustment to offset certain property management costs
and related reimbursements against the related revenue.
(x) Represents a reduction in personnel costs pursuant to a
restructuring plan, approved by AIMCO senior management, assuming
that the acquisition of NHP had occurred on January 1, 1996 and that
the restructuring plan was completed on January 1, 1996. The
restructuring plan specifically identifies all significant actions
to be taken to complete the restructuring plan, including the
reduction of personnel, job functions, location and the date of
completion.
(xi) Represents depreciation and amortization of the tangible and
intangible assets related to the property management and other
businesses operated by ANHI, including amortization of management
contracts of $1,899, depreciation of furniture, fixtures and
equipment of $669, and amortization of goodwill of $4,335, less
ANHI's 51.3% share of NHP's historical depreciation and
amortization of $3,243. Management contracts are amortized using
the straight-line method over the weighted average life of 15
years. Furniture, fixtures and equipment are depreciated using
the straight-line method over the estimated life of 5 years.
Goodwill is amortized using the straight-line method over 20
years.
(xii) Represents the adjustment to the estimated Federal and state tax
provisions calculated on the operating results of ANHI, excluding
the amortization of goodwill which is not deductible for tax
purposes.
(xiii) Represents the equity in earnings of NHP attributable to ANHI's
ownership of 51.3% of the NHP Common Stock outstanding as a
result of the Inital NHP Stock Purchase.
(xiv) Represents the share of NHP income attributable to the 48.7% of the
NHP Common Stock owned by other stockholders.
(xv) Represents the adjustment to the estimated Federal and state tax
provisions calculated on the operating results of ANHI, as adjusted
for the ANHI Stock Transfers.
(xvi) Represents the adjustment for the reduction in equity in earnings of
NHP resulting from the ANHI Stock Transfers, reducing ANHI's
investment in NHP from 51.3% to 6.03% as of January 1, 1996.
(xvii) Represents adjustments for the historical results of operations of
the real estate properties and interest in real estate
partnerships contributed, with additional depreciation and
amortization recorded related to AIMCO's new basis resulting from
the allocation of the combined purchase price of NHP and the NHP
Real Estate Companies.
(xviii) Represents adjustments to reflect income and expenses associated
with certain assets and liabilities of NHP contributed.
(xix) Represents the interest expense incurred on notes payable to AIMCO
of $40,000 issued in connection with the sale of certain assets
and liabilities to the Unconsolidated Subsidiaries and $55,304
issued in connection with the sale of certain real estate assets
and related liabilities and interests in certain real estate
partnerships to the Unconsolidated Subsidiaries.
(xx) Represents the estimated Federal and state tax provisions, which are
calculated on the operating results of the Unconsolidated
Subsidiaries, excluding amortization of goodwill which is not
deductible for tax purposes. The Unconsolidated Subsidiaries
current tax provision for the year ended December 31, 1996 would
be approximately $1,324 which differs from the book tax provision
primarily due to differences in amortization of tangible and
intangible assets and expensing of lease and severance costs
which are included in purchase consideration for financial
reporting.
(xxi) Represents the reduction of minority interest in one real estate
partnership owning 14 real estate properties containing
2,725 apartment units. As part of the NHP Reorganization, AIMCO
will contribute the limited partnership interests in the
partnership currently consolidated by the Unconsolidated
Subsidiaries. Therefore, the Unconsolidated Subsidiaries will own
99% of the interests in such partnership.
(xxii) The allocation of the purchase price of NHP is preliminary;
therefore, the amount and life of goodwill are subject to change
as additional information is obtained and the purchase price
allocation is finalized. In addition, a 20-year life for goodwill
is preliminary and is subject to change. The expected life of
goodwill will depend upon the final valuation of the various
intangible assets, which could range from five years to 20 years.
If the estimated life of goodwill is ultimately determined to be
five years, amortization of management contracts and goodwill and
depreciation and amortization of other assets would be $29,884
and net loss would be $(9,133).
19
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the Nine Months Ended September 30, 1997
(In thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
October 1997
Offering &
AIMCO Winthrop
Historical (A) Adjustments (B) Acquisition (C)
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $ 127,083 $ 24,243 (I) $ 37,399
Property operating expenses (50,737) (12,256) (I) (16,841)
Owned property management expense (4,344) (607) (I) (1,367)
-------------------------------------------------------------
Income from property operations
before depreciation 72,002 11,380 19,191
Depreciation (23,848) (4,993) (I) (6,917)
-------------------------------------------------------------
Income from property operations 48,154 6,387 12,274
-------------------------------------------------------------
SERVICE COMPANY BUSINESS
Management fees and other income 9,173 - -
Management and other expenses (5,029) - -
Corporate overhead allocation (441) - -
Amortization of management company
goodwill and other assets
depreciation and amortization (947) - -
-------------------------------------------------------------
Income from service company business 2,756 - -
Minority interest in service company
business 48 - -
-------------------------------------------------------------
Company's share of income from
service company busines 2,804 - -
-------------------------------------------------------------
General and administrative expenses (1,408) - -
Interest expense (33,359) 2 (J) (2,490)
Interest income 4,458 - -
Equity in earnings of unconsolidated
subsidiaries 456 - -
Equity in losses of unconsolidated
partnerships (463) (50) (K) -
Minority Interest in other partnerships (777) 934 -
-------------------------------------------------------------
Income before extraordinary item, gain
(loss) on dosposition of properties and
minority interest in Operating Partnership 19,865 7,273 9,784
Extraordinary item (269) 269 -
Gain (loss) on disposition of properties (169) 169 -
-------------------------------------------------------------
Income before minority interests in
Operating Partnership 19,427 7,711 9,784
Income tax provision - -
Minority interest in Operating Partnership (2,612) (1,246) (FF) (568) (FF)
-------------------------------------------------------------
Net income $ 16,815 $ 6,465 $ 9,216
-------------------------------------------------------------
-------------------------------------------------------------
Net income allocable to preferred stockholder $ 835
--------------
--------------
Net income allocable to common stockholders $ 15,980
--------------
--------------
Net income per common share (II) $ 0.77
--------------
--------------
Weighted average number of common
shares and common share equivalents 20,629
outstanding
--------------
--------------
NHP Real
Estate Foxchase
Acquisition (D) Acquisition (E)
----------------------------------------
<S> <C> <C> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $ 6,660 (L) $ 14,195
Property operating expenses (2,941) (L) (4,461)
Owned property management expense (282) (L) (761)
----------------------------------------
Income from property operations
before depreciation 3,437 8,973
Depreciation (1,346) (L) (2,895)
----------------------------------------
Income from property operations 2,091 6,078
SERVICE COMPANY BUSINESS ----------------------------------------
Management fees and other income 1,405 (M) -
Management and other expenses (4,878) (M) -
2,615 (N)
Corporate overhead allocation
Amortization of management company - -
goodwill and other assets
depreciation and amortization - -
----------------------------------------
Income from service company business (858) -
Minority interest in service company
business - -
----------------------------------------
Company's share of income from
service company busines (858) -
----------------------------------------
General and administrative expenses - -
Interest expense (3,391) (L) (4,624)
(1,631) (O)
Interest income 540 (M) -
Equity in earnings of unconsolidated
subsidiaries - -
Equity in losses of unconsolidated
partnerships (2,432) (L) (72)
(790) (P)
Minority Interest in other partnerships 16 (L) -
Income before extraordinary item, gain ----------------------------------------
(loss) on disposition of properties
and minority interest in Operating
Partnership (6,455) 1,382
Extraordinary item - -
Gain (loss) on disposition of properties - -
----------------------------------------
Income before minority interests in
Operating Partnership (6,455) 1,382
Income tax provision -
Minority interest in Operating Partnership - 536
----------------------------------------
Net income $ (6,455) $ 1,918
----------------------------------------
Net income allocable to preferred stock ----------------------------------------
Net income allocable to common stockholders
Net income per common share (II)
Weighted average number of common
shares and common share equivalent
outstanding
NHP Merger NHP Reor- Pro Forma
Historical (F) Adjustments (G) ganization (H) Total
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $ 7,310 $ 6,006 (Q) $ (24,188) (X)
(7,310) (Y) $ 191,398
Property operating expenses (4,639) (3,786) (Q) 8,090 (X)
4,639 (Y) (82,932)
Owned property management expense - (426) (Q) 1,198 (X)
355 (Z)
(6,234)
-------------------------------------------------------------------------
Income from property operations
before depreciation 2,671 1,794 (17,216) 102,232
Depreciation (750) (3,387) (Q) 4,830 (X)
4,137 (Y) (35,169)
-------------------------------------------------------------------------
Income from property operations 1,921 (1,593) (8,249) 67,063
-------------------------------------------------------------------------
SERVICE COMPANY BUSINESS
Management fees and other income 154,778 (99,467) (R) (53,598) (AA)
(1,388) (Z) 10,903
Management and other expenses (121,724) 99,467 (R) 21,161 (AA)
(8,388)
Corporate overhead allocation - - - (441)
Amortization of management company
goodwill and other assets
depreciation and amortization (7,725) (1,384) (S) 8,923 (AA) (1,133)
-------------------------------------------------------------------------
Income from service company business 25,329 (1,384) (24,902) 941
Minority interest in service company
business - - - 48
-------------------------------------------------------------------------
Company's share of income from
service company business 25,329 (1,384) (24,902) 989
-------------------------------------------------------------------------
General and administrative expenses (17,729) 6,501 (T) 11,795 (AA)
(841)
Interest expense (6,651) (2,164) (Q) 4,358 (AA)
(416) (U) 10,552 (X)
4,873 (Y) (34,941) (GG)
Interest income 1,663 - (1,663) (AA)
208 (BB)
150 (CC) 5,356
Equity in earnings of unconsolidated
subsidiaries - (1,295) (V) 980 (DD)
2,850 (EE)
3,929 (EE) 6,920 (JJ)
Equity in losses of unconsolidated
partnerships - (4,512) (W) 767 (X)
(6,329) (Y)
929 (Z) (12,952)
Minority Interest in other partnerships - 7 (Q) (512) (Y) (332)
-------------------------------------------------------------------------
Income before extraordinary item, gain
(loss) on disposition of properties and
minority interest in Operating Partnership 4,533 (4,856) (264) 31,262
Extraordinary item - - - -
Gain (loss) on disposition of properties - - - -
-------------------------------------------------------------------------
Income before minority interests in
Operating Partnership 4,533 (4,856) (264) 31,262
Income tax provision (1,813) - 1,813 (AA) -
Minority interest in Operating Partnership - 755 (FF) (294) (FF) (3,429)
-------------------------------------------------------------------------
Net income $ 2,720 $ (4,101) $ 1,255 $ 27,833 (GG)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net income allocable to preferred stockholder $ 4,008 (HH)
----------
----------
Net income allocable to common stockholders $ 23,825 (GG)
----------
----------
Net income per common share (II) $ 0.59 (GG)
----------
----------
Weighted average number of common
shares and common share equivalents 40,396 (GG)
outstanding
----------
----------
</TABLE>
The pro forma statement above is presented assuming all NHP stockholders (other
than ANHI) elect to receive Stock Consideration. See note (GG) for the effect
on the pro forma statement if all NHP stockholders elect to receive Mixed
Consideration.
20
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(A) Represents AIMCO's unaudited consolidated results of operations for the
nine months ended September 30, 1997.
(B) Represents adjustments to reflect the following as if they had occurred on
January 1, 1996: (i) the Recent Property Acquisitions; (ii) the February
1997 Stock Offering; (iii) the May 1997 Stock Offering; (iv) the Preferred
Stock Offering (v) the September 1997 Stock Offerings; (vi) the ANHI
Dividend; (vii) the Ambassador Stock Acquisition; (viii) the Loan
Acquisitions; (ix) the Land Lease Acquisitions; (x) the Property Loan
Payment; (xi) the Sawgrass Acquisition; (xii) the Morton Towers
Acquisition; (xiii) the Los Arboles Acquisition; (xiv) the Windward
Acquisition; (xv) the Tender Offers; and (xvi) the 1997 Dispositions.
(C) Represents adjustments to reflect the October 1997 Offering and Winthrop
Acquisition as if they had occurred on January 1, 1996.
(D) Represents the adjustment to reflect the acquisition of the NHP Real Estate
Companies as if it had occurred on January 1, 1996. The historical financial
statements of the NHP Real Estate Companies consolidate certain real estate
partnerships in which they have an interest that will be presented on the
equity method by AIMCO as a result of the NHP Real Estate Reorganization. If
AIMCO is not in a position to control the partnership or the real estate
assets owned by any partnership in which it has an interest, such
partnership is not consolidated. Factors which preclude control include, but
are not limited to, not controlling a majority of the general partner
interest, and not owning sufficient interest to control the partnership when
there exists the presence of significant limited partner rights, including
the right to vote on a sale of real estate owned by the partnership or the
refinancing of debt. As part of the NHP Real Estate Reorganization, AIMCO
transferred its ownership interests in certain partnerships to an
unconsolidated subsidiary or partnership in which AIMCO does not exercise
control; therefore, AIMCO does not consolidate such partnerships. In
addition, represents adjustments to record additional depreciation and
amortization related to the increased basis in the assets of the NHP Real
Estate Companies as a result of the allocation of the purchase price of the
NHP Real Estate Companies and additional interest expense incurred in
connection with borrowings incurred by AIMCO to consummate the NHP Real
Estate Acquisition.
(E) Represents adjustments to reflect the Foxchase Acquisition as if it had
occurred on January 1, 1996.
(F) Represents the unaudited consolidated results of operations of NHP for the
nine months ended September 30, 1997.
(G) Represents the following adjustments occurring as a result of the Merger:
(i) the reclassification of NHP's real estate held for sale to real estate
held for investment; (ii) the offsetting of on-site personnel and general
and administrative cost reimbursement against the related revenue; (iii) the
reduction in personnel costs, primarily severance costs, pursuant to a
restructuring plan; (iv) the incremental amortization of the purchase price
adjustment related to the management contracts, furniture, fixtures and
equipment, and goodwill; (v) the reversal of equity in earnings in NHP
during the pre-merger period when AIMCO held a 47.62% interest in NHP; and
(vi) the amortization of the increased basis in investments in real estate
partnerships based on the purchase price adjustment related to the real
estate and an estimated average life of 17.5 years.
(H) Represents adjustments related to the NHP Reorganization, whereby AIMCO will
contribute or sell to the combined Unconsolidated Subsidiaries: (i) certain
assets and liabilities of NHP, primarily related to the management
operations and other businesses owned by NHP; and (ii) 16 real estate
properties containing 3,625 apartment units and the related liabilities, and
interests in four real estate partnerships owning four real estate
properties containing 2,836 apartment units. In addition, AIMCO will
contribute 12 real estate properties containing 2,905 apartment units to
the Unconsolidated Partnership. The adjustments represent (i) the related
revenues and expenses primarily related to the management operations and
other businesses owned by NHP; and (ii) the historical results of operations
of such real estate properties and interests in such real estate
partnerships contributed, with additional depreciation and amortization
recorded related to AIMCO's new basis resulting from the allocation of the
combined purchase price of NHP and the NHP Real Estate Companies.
(I) Represents adjustments to reflect the Recent Property Acquisitions the
Sawgrass Acquisition, the Morton Towers Acquisition, the Los Arboles
Acquisition, the Windward Acquisition and the Tender Offers, less the 1997
Dispositions as if they had occurred on January 1, 1996. These pro forma
operating results are based on historical results of the properties, except
for depreciation, which is based on AIMCO's investment in the properties.
(J) Represents adjustments to interest expense for the following:
<TABLE>
<S> <C>
Borrowings on AIMCO's Credit Facility and other loans and mortgages assumed in connection with
the Recent Property Acquisitions............................................................... $ (2,961)
Borrowings on AIMCO's new secured short-term financing in connection with the Sawgrass
Acquisition.................................................................................... (498)
Borrowings on AIMCO's Credit Facility in connection with the Los Arboles Acquisition............. (654)
Borrowings on AIMCO's Credit Facility in connection with the Morton Towers Acquisition........... (256)
Borrowings on AIMCO's Credit Facility in connection with the Land Lease Acquisitions............. (136)
Borrowings on AIMCO's Credit Facility in connection with the Loan Acquisitions................... (1,873)
Borrowings on AIMCO's Credit Facility in connection with the Ambassador Stock Acquisition........ (707)
Borrowings on AIMCO's Credit Facility in connection with the Windward Acquisition................. (576)
Borrowings on AIMCO's Credit Facility in connection with the Tender Offers....................... (2,362)
Reduction in interest for the payment of loans in connection with the Loan Acquisitions and the
Property Loan Payment.......................................................................... 1,265
Repayments on AIMCO's Credit Facility and other indebtedness with proceeds from the 1997
Dispositions, the February 1997 Stock Offering, the May 1997 Stock Offering, the Preferred
Stock Offering, and the September 1997 Stock Offerings......................................... 6,871
Repayments on AIMCO's Credit Facility with proceeds from the ANHI Dividend....................... 1,889
---------
$ 2
---------
---------
</TABLE>
21
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(K) Represents adjustments related to the Tender Offers to eliminate the
historical equity in earnings of unconsolidated partnerships.
(L) Represents adjustments to reflect the acquisition of the NHP Real Estate
Companies and the corresponding historical results of operations as if they
had occurred on January 1, 1996, including reflecting the NHP Real Estate
Reorganization.
(M) Represents the adjustment to record the revenues and expenses from
ancillary businesses purchased from the NHP Real Estate Companies as if
the acquisition had occurred on January 1, 1996.
(N) Represents a reduction in personnel costs pursuant to a restructuring plan,
approved by AIMCO senior management, assuming that the acquisition of the
NHP Real Estate Companies had occurred on January 1, 1996 and that the
restructuring plan was completed on January 1, 1996. The restructuring plan
specifically identifies all significant actions to be taken to complete the
restructuring plan, including the reduction of personnel, job functions,
location and the date of completion.
(O) Represents the increase in interest expense related to borrowings on
AIMCO's Credit Facility of $55,807 to finance the NHP Real Estate
Acquisition.
(P) Represents amortization of the increased basis in investment in real estate
partnerships, as a result of the allocation of the purchase price of the
NHP Real Estate Companies, based on an estimated average life of 17.5
years.
(Q) Represents the operating results of real estate held for investment by
AIMCO, which was classified as real estate held for sale by NHP prior to
the Initial NHP Stock Purchase.
(R) Represents the offsetting of on-site personnel and general and
administrative cost reimbursement against the related revenue.
(S) Represents incremental depreciation and amortization of the tangible and
intangible assets related to the property management and other business
operated by the Unconsolidated Subsidiaries, based on AIMCO's new basis as
adusted by the allocation of the combined purchase price of NHP and the NHP
Real Estate Companies, including amortization of management contracts of
$2,777, depreciation of furniture, fixtures and equipment of $977 and
amortization of goodwill of $4,704, less NHP's historical depreciation and
amortization of $(7,074). Management contracts are amortized using the
straight-line method over the weighted average life of the contracts
estimated to be 15 years. Furniture, fixtures and equipment are
depreciated using the straight-line method over the estimated life of 5
years. Goodwill is amortized using the straight-line method over 20 years.
The allocation of the purchase price of NHP is preliminary; therefore, the
amount and life of goodwill are subject to change as additional information
is obtained and the purchase price allocation is finalized. The expected
life of goodwill will depend upon the final valuation of the various
intangible assets, which could range from five years to 20 years. If the
estimated life of goodwill is ultimately determined to be five years,
goodwill amortization would be $17,805, net income applicable to common
shareholders would be $14,639 and net income per common share would be
$0.36.
(T) Represents a reduction in personnel costs, primarily severance costs,
pursuant to a restructuring plan, approved by AIMCO senior management,
specifically identifying all significant actions to be taken to complete
the restructuring plan, assuming that the Merger had occurred on
January 1, 1996 and that the restructuring plan was completed on
January 1, 1996.
(U) Represents the interest related to the indebtedness of $7,791 incurred to
finance the cash portion of the Merger Consideration to ANHI. The
borrowings were made under AIMCO's Credit Facility, which bears interest
at LIBOR plus 1.70% per annum.
(V) Represents the reversal of equity in earnings in NHP during the pre-merger
period when AIMCO held a 47.62% interest in NHP, as a result of AIMCO's
acquisition of 100% of the NHP Common Stock.
(W) Represents adjustment for amortization of the increased basis in
investments in real estate partnerships, as a result of the allocation of
the combined purchase price of NHP and the NHP Real Estate Companies,
based on an estimated average life of 17.5 years.
22
<PAGE>
(X) Represents the results of operations of real estate contributed to the
Unconsolidated Subsidiaries, including 16 real estate properties
containing 3,625 apartment units and interests in four real estate
partnerships owning four real estate properties containing 2,836 apartment
units.
(Y) Represents the contribution of NHP's 12 real estate properties
containing 2,905 apartment units to the Unconsolidated Partnership pursuant
to the NHP Reorganization.
(Z) Represents the elimination of the income generated by the management
contracts which are related to the interests in real estate partnerships
owned by AIMCO or the Unconsolidated Partnership.
(AA) Represents the historical income and expenses associated with certain
assets and liabilities of NHP that will be contributed to the
Unconsolidated Subsidiaries, primarily related to the management
operations and other businesses owned by NHP.
(BB) Represents the interest income of $4,148 earned on notes payable of $55,304
to AIMCO issued as consideration for certain real estate assets and
liabilities and interests in certain real estate partnerships sold to the
Unconsolidated Subsidiaries by AIMCO, net of the elimination of AIMCO's
share of the related interest expense of $3,940 reflected in the equity in
earnings of ANHI's operating results.
(CC) Represents interest income of $3,000 earned on the notes receivable from
the Unconsolidated Subsidiaries, after elimination of AIMCO's share of
$2,850 of the related interest expense.
(DD) Represents adjustment to AIMCO's equity in income (loss) of the
Unconsolidated Subsidiaries on a post-Merger basis, before elimination of
interest expense on notes receivable from the Unconsolidated Subsidiaries.
(EE) Represents elimination of AIMCO's share of the related interest expense
reflected in the equity in earnings of ANHI's operating results.
(FF) Represents adjustments to minority interest in the Operating Partnership
assuming the Recent Property Acquisitions, the February 1997 Stock
Offering, the May 1997 Stock Offering, the July 1997 Stock Sale, the
Preferred Stock Offering, the August 1997 Stock Offering, the September
1997 Stock Offerings, the ANHI Dividend, the Ambassador Stock Acquisition,
the Loan Acquisitions, the Land Lease Acquisitions, the Property Loan
Payment, the Sawgrass Acquisition, the Morton Towers Acquisition, the
Los Arboles Acquisition, the Windward Acquisition, the Tender Offers, the
NHP Stock Purchase and the NHP Real Estate Acquisitions, the October 1997
Offering and Winthrop Acquisition and the Merger, had occurred as of
January 1, 1996. On a pro forma basis, without giving effect to the
Merger, as of September 30, 1997, the minority interest percentage is
approximately 12.4%. On a pro forma basis, giving effect to the Merger,
as of September 30, 1997, the minority interest percentage is approximately
11.0%, assuming that ANHI elects Mixed Consideration and all other NHP
stockholders elect Stock Consideration.
(GG) Pursuant to the Merger, NHP stockholders may elect to receive Stock
Consideration or Mixed Consideration. Set forth below is a summary of the
pro forma net income applicable to holders of AIMCO Common Stock and net
income per share of AIMCO Common Stock (i) assuming that ANHI elects Mixed
Consideration and all other NHP stockholders, excluding AIMCO, elect to
receive Stock Consideration (Stock Consideration); and assuming all NHP
stockholders, excluding AIMCO but including ANHI, elect to receive Mixed
Consideration (Mixed Consideration). The detail below assumes an average
interest rate of 7.36% per annum (representing LIBOR plus 1.70%, the
current rate under AIMCO's unsecured credit facility) on the additional
borrowings of $60,518.
<TABLE>
<CAPTION>
STOCK MIXED
CONSIDERATION CONSIDERATION
------------- -------------
<S> <C> <C>
Increase in interest expense........................................ $ -- $ 2,231
------------- -------------
------------- -------------
Income before minority interest in Operating Partnership (after
minority interest in other partnerships).......................... $ 31,262 $ 29,031
Minority interest in Operating Partnership.......................... (3,429) (3,351)
------------- -------------
Net income.......................................................... $ 27,833 $ 25,680
------------- -------------
------------- -------------
Net income attributable to common stockholders...................... $ 23,825 $ 21,672
------------- -------------
------------- -------------
Net income per share................................................ $ 0.59 $ 0.57
------------- -------------
------------- -------------
Minority interest percentage in Operating Partnership............... 10.97% 11.54%
------------- -------------
------------- -------------
Number of common shares and common share equivalents................ 40,396 38,134
------------- -------------
------------- -------------
</TABLE>
Additionally, the following table presents the net impact to pro forma net
income applicable to holders of AIMCO Common Stock and net income per share
of AIMCO Common Stock assuming the interest rate per annum increases by
0.25%.
<TABLE>
<CAPTION>
STOCK MIXED
CONSIDERATION CONSIDERATION
------------- -------------
<S> <C> <C>
Increase in interest expense........................................ $ -- $ 2,668
------------- -------------
------------- -------------
Income before minority interest in Operating Partnership (after
minority interest in other partnerships).......................... $ 30,934 $ 28,592
Minority interest in Operating Partnership.......................... (3,393) (3,299)
------------- -------------
Net income.......................................................... $ 27,541 $ 25,293
------------- -------------
------------- -------------
Net income attributable to common stockholders...................... $ 23,533 $ 21,285
------------- -------------
------------- -------------
Net income per share................................................ $ 0.58 $ 0.56
------------- -------------
------------- -------------
Minority interest percentage in Operating Partnership............... 10.97% 11.54%
------------- -------------
------------- -------------
Number of common shares and common share equivalents................ 40,396 38,134
------------- -------------
------------- -------------
</TABLE>
(HH) Represents the net income allocated to holders of the AIMCO Class B
Preferred Stock as if the Preferred Stock Offering had occurred as of
January 1, 1996.
(II) In February 1997, the Financial Accounting Standards Board issued Statement
128 which specifies the computation, presentation and disclosure
requirements for basic earnings per share and diluted earnings per share.
AIMCO's management believes that adoption of Statement 128 will not have a
material effect on the earnings per share of AIMCO.
23
<PAGE>
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(CONTINUED)
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
(JJ) Amount represents (i) AIMCO's equity in earnings in the Unconsolidated
Subsidiaries' operating results of $40, detailed below; and (ii) AIMCO's
equity in earnings of $571 for its 47.62% interest in NHP. The combined Pro
Forma Statement of Operations (pre-Merger) of the Unconsolidated
Subsidiaries for the nine months ended September 30, 1997 is presented
below, which is based on a series of transactions, including the Initial
NHP Stock Purchase, resulting in ANHI owning 51.3% of NHP, the ANHI Stock
Transfers, resulting in ANHI owning only 6.03% of NHP, and the
contribution, from AIMCO to one of the Unconsolidated Subsidiaries, of the
general partnership interest, and therefore controlling interest, in one
real estate partnership, owning 14 real estate properties with 2,725
apartment units. Interests held by limited partners in the real estate
partnerships controlled by the Unconsolidated Subsidiary are reflected as
minority interest in consolidated partnerships.
<TABLE>
<CAPTION>
ANHI Contribute
Stock Real
Historical (i) Transfers (ii) Estate (iii) Merger (iv)
-------------------------------------------------------------------
<S> <C> <C> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $10,675 $ (6,194) $ 4,987
Property operating expenses (7,135) 3,355 (1,404)
Owned property management expenses (355) 147 (260)
-------------------------------------------------------------------
Income from property operations before
depreciation 3,185 (2,692) 3,323 $ -
Depreciation (1,567) 1,038 (662)
-------------------------------------------------------------------
1,618 (1,654) 2,661 -
-------------------------------------------------------------------
SERVICE COMPANY BUSINESS
Management fees and other income 23,776 (23,776) -
Management and other expenses (11,733) 11,733 -
Amortization of management contracts
and goodwill and depreciation and
amortization of other assets (3,726) 3,726 (31)
-------------------------------------------------------------------
8,317 (8,317) (31) -
-------------------------------------------------------------------
General and administrative - - -
Interest expense (6,847) 6,058 (986)
Interest income 979 (979) -
-------------------------------------------------------------------
Income before income taxes, equity in
earnings and minority interests 4,067 (4,892) 1,644 -
Income tax provision (1,882) 1,808 -
Equity in earnings of NHP 161 3 - (164)
Equity in losses of partnerships (1,028) 1,028 -
Minority interest in NHP (2,217) 2,217 -
Minority interest in partnerships - - (798)
-------------------------------------------------------------------
Net Income $ (899) $ 164 $ 846 $(164)
-------------------------------------------------------------------
-------------------------------------------------------------------
Income attributable to preferred
stockholder $ 105
---------
---------
Income attributable to common
stockholders $ (1,004)
---------
---------
NHP Reor- Pro Forma
ganization (v) Total
-------------------------------
<S> <C> <C>
RENTAL PROPERTY OPERATIONS
Rental and other property revenues $ 24,188 (vi) $ 33,656
Property operating expenses (8,090)(vi) (13,274)
Owned property management expenses (1,198)(vi) (1,666)
-------------------------------
Income from property operations before
depreciation 14,900 18,716
Depreciation (4,830) (vi) (6,021)
-------------------------------
10,070 12,695
SERVICE COMPANY BUSINESS
Management fees and other income 53,598 (vii) 53,598
Management and other expenses (21,161) (vii) (21,161)
Amortization of management contracts
and goodwill and depreciation and
amortization of other assets (8,923) (vii) (8,954) (xi)
-------------------------------
23,514 23,483
-------------------------------
General and administrative (11,795) (vii) (11,795)
Interest expense (4,358) (vii)
(10,538) (vi)
(3,000) (viii)
(4,148) (viii) (23,819)
Interest income 1,663 (vii) 1,663
-------------------------------
Income before income taxes, equity in
earnings and minority interests 1,408 2,227
Income tax provision (1,046) (ix) (1,120)
Equity in earnings of NHP -
Equity in losses of partnerships (663) (vi) (663)
Minority interest in NHP -
Minority interest in partnerships 502 (x) (296)
-------------------------------
Net Income $ 201 $ 148
Income attributable to preferred
stockholder $ 141
---------
---------
Income attributable to common
stockholders $ 7
---------
---------
</TABLE>
- ------------------------------
(i) Represents the unaudited combined results of operations of the
Unconsolidated Subsidiaries for the nine months ended September 30, 1997,
excluding the income from discontinued operations of WMF.
(ii) Represents the sale of 5,717,000 shares of NHP Common Stock to AIMCO
reducing ANHI's ownership of NHP Common Stock from 51.3% to 6.03%;
therefore, ANHI will account for its investment in NHP on the equity
method.
(iii) Represents the results of operations of the Consolidated Real Estate
Partnership as if the contribution of the general partnership interest
from AIMCO to the Unconsolidated Subsidiary had occurred on January 1,
1996.
(iv) Represents adjustments for the Merger. Subsequent to the Merger, all of
the outstanding shares of NHP Common Stock will be owned by AIMCO.
(v) Represents adjustments related to the NHP Reorganization, whereby AIMCO
will contribute to the combined Unconsolidated Subsidiaries: (i) certain
assets and liabilities of NHP, primarily related to the management
operations and other businesses owned by NHP; and (ii) 16 real
estate properties containing 3,625 apartment units and the related
liabilities, and interests in four real estate partnerships owning four
real estate properties containing 2,836 apartment units. Adjustments
reflect (i) income and expenses associated with certain assets and
liabilities of NHP that will be contributed to the Unconsolidated
Subsidiaries, primarily related to the management operations and other
businesses owned by NHP; (ii) adjustments for management costs that will
be incurred by the Unconsolidated Subsidiaries rather than by AIMCO,
primarily related to personnel costs, for work performed on the
businesses contributed to by the Unconsolidated Subsidiaries;
(iii) depreciation and amortization of the tangible and intangible assets
related to the management operations and other business contributed to
the Unconsolidated Subsidiaries; (iv) interest expense associated with
NHP's historical notes payable and on the notes payable to AIMCO;
(v) historical interest income of NHP; (vi) income tax provision; and
(vii) the historical results of operations of real estate properties and
interests in real estate partnerships contributed, with additional
depreciation and amortization recorded related to AIMCO's new basis
resulting from the allocation of the combined purchase price of NHP and
the NHP Real Estate Companies.
(vi) Represents adjustments for the historical results of operations of the
real estate properties and interest in real estate partnerships
contributed, with additional depreciation and amortization recorded
related to AIMCO's new basis resulting from the allocation of the
combined purchase price of NHP and the NHP Real Estate Companies.
(vii) Represents adjustments to reflect income and expenses associated with
certain assets and liabilities of NHP contributed.
(viii) Represents the interest expense incurred on notes payable to AIMCO of
$40,000 issued in connection with the sale of certain assets and
liabilities to the Unconsolidated Subsidiaries and $55,304 issued in
connection with the sale of certain real estate assets and related
liabilities and interests in certain real estate partnerships to the
Unconsolidated Subsidiaries.
(ix) Represents the estimated Federal and state tax provisions, which are
calculated on the operating results of the Unconsolidated Subsidiaries,
excluding amortization of goodwill which is not deductible for tax
purposes. The Unconsolidated Subsidiaries current tax provision for the
nine months ended September 30, 1997 would be approximately $520, which
differs from the book tax provision primarily due to differences in
amortization of tangible and intangible assets and expensing of lease
costs which are included in purchase consideration for financial
reporting.
(x) Represents the reduction of minority interest in one real estate
partnership owning fourteen real estate properties containing 2,725
apartment units. As part of the NHP Reorganization, AIMCO will
contribute the limited partnership interests in the partnership
currently consolidated by the Unconsolidated Subsidiaries. Therefore,
the Unconsolidated Subsidiaries will own 99% of the interests in such
partnership.
(xi) The allocation of the purchase price of NHP is preliminary; therefore,
the amount and life of goodwill are subject to change as additional
information is obtained and the purchase price allocation is finalized.
In addition a 20-year life for goodwill is preliminary and is subject
to change. The expected life of goodwill will depend upon the final
valuation of the various intangible assets, which could range from five
years to 20 years. If the life of goodwill is ultimately determined to
be five years, amortization of management contracts and goodwill and
depreciation and amortization of other assets would be $23,064 and net
loss would be $(10,779).
24
<PAGE>
FINANCIAL STATEMENT AND
INDEPENDENT AUDITORS' REPORT
FIRST ALEXANDRIA ASSOCIATES
A LIMITED PARTNERSHIP
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<PAGE>
First Alexandria Associates
A Limited Partnership
TABLE OF CONTENTS
PAGE
INDEPENDENT AUDITORS' REPORT 3
FINANCIAL STATEMENT
STATEMENT OF REVENUES AND CERTAIN EXPENSES 4
NOTES TO STATEMENT OF REVENUES AND CERTAIN EXPENSES 5
<PAGE>
[Letterhead]
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
NHP Incorporated
We have audited the accompanying statement of revenues and certain
expenses of First Alexandria Associates, A Limited Partnership, for the years
ended December 31, 1996, 1995 and 1994. This financial statement is the
responsibility of NHP Incorporated. Our responsibility is to express an
opinion on the statement of revenues and certain expenses based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform our audit to
obtain reasonable assurance about whether the financial statement is free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statement.
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.
The accompanying statement of revenues and certain expenses was
prepared in compliance with the rules and regulations of the Securities and
Exchange Commission and, as described in Note A, is not intended to be a
complete presentation of the property's revenues and expenses.
In our opinion, the financial statement referred to above presents
fairly, in all material respects, the revenues and certain expenses of the
property, for the years ended December 31, 1996, 1995 and 1994, in conformity
with generally accepted accounting principles.
/s/ Reznick Fedder & Silverman
Bethesda, Maryland
December 11, 1997
-3-
<PAGE>
FIRST ALEXANDRIA ASSOCIATES
A LIMITED PARTNERSHIP
STATEMENT OF REVENUES AND CERTAIN EXPENSES
<TABLE>
<CAPTION>
For the Nine Months
Ended September 30, 1997 For the Year Ended For the Year Ended For the Year Ended
(unaudited) December 31, 1996 December 31, 1995 December 31, 1994
------------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
REVENUES:
Rental Income $ 13,912,090 $ 18,176,552 $ 17,900,608 $ 18,405,886
Other Income 283,288 424,836 393,861 352,404
------------------------ ------------------ ------------------ ------------------
Total Revenues 14,195,378 18,601,388 18,294,469 18,758,290
------------------------ ------------------ ------------------ ------------------
CERTAIN EXPENSES:
Leasing 180,642 262,309 319,657 267,720
Payroll and benefits 1,147,188 1,749,257 1,680,799 1,610,614
General and administrative 94,165 456,426 504,436 429,749
Management Fees 760,897 905,650 886,481 902,229
Utilities 607,351 820,883 826,747 767,561
Repairs and maintenance 936,541 1,987,780 1,853,128 2,164,915
Janitorial 75,419 46,446 45,546 47,976
Painting and decorating 176,323 250,914 251,813 265,959
Insurance 197,682 607,340 600,904 613,868
Payroll Taxes 85,241 133,420 130,938 120,814
Real Estate Taxes 961,086 1,219,627 1,270,255 1,293,439
------------------------ ------------------ ------------------ ------------------
Total Certain Expenses 5,222,535 8,440,052 8,370,704 8,484,844
------------------------ ------------------ ------------------ ------------------
REVENUES IN EXCESS OF CERTAIN EXPENSES $ 8,972,843 $ 10,161,336 $ 9,923,765 $ 10,273,446
------------------------ ------------------ ------------------ ------------------
------------------------ ------------------ ------------------ ------------------
</TABLE>
See notes to Statement of Revenues and Certain Expenses
-4-
<PAGE>
First Alexandria Associates
A Limited Partnership
NOTES TO STATEMENT OF REVENUES AND CERTAIN EXPENSES
Years ended December 31, 1996, 1995 and 1994
NOTE A - ORGANIZATION AND BASIS OF PRESENTATION
ORGANIZATION
The accompanying statement of revenues and certain expenses (the statement)
includes the operations of First Alexandria Associates, A Limited
Partnership (the property), owned by NHP Incorporated.
Apartment Investment and Management Company (AIMCO), an unaffiliated party
to the property, has entered into a Purchase and Sale Agreement related to
the acquisition of the property through AIMCO Properties, L.P. (the
operating partnership). A wholly-owned subsidiary of AIMCO is the sole
general partner and a wholly-owned subsidiary of AIMCO is a limited partner
which owns a majority interest in the operating partnership. The property
consists of 2,113 units located in Alexandria, Virginia, and is currently
operating under the name Foxchase of Alexandria.
The property will be acquired for cash and the assumption of debt.
BASIS OF PRESENTATION
The accompanying statement was prepared to comply with the rules and
regulations of the Securities and Exchange Commission (the SEC).
The accompanying statement is not representative of the actual operations
for the period presented as certain revenues and expenses have been
excluded that may not be comparable to the revenues and expenses expected
to be incurred by the operating partnership in the proposed future
operations of the property. Revenues excluded consist of interest income.
Expenses excluded consist of depreciation, amortization, interest on
non-assumed debt and other costs not directly related to the expected
future operations of the property.
-5-
<PAGE>
First Alexandria Associates
A Limited Partnership
NOTES TO STATEMENT OF REVENUES AND CERTAIN EXPENSES -
CONTINUED
Years ended December 31, 1996, 1995 and 1994
NOTE A - ORGANIZATION AND BASIS OF PRESENTATION (Continued)
INTERIM UNAUDITED STATEMENT OF REVENUES AND CERTAIN EXPENSES
The statement of revenues and certain expenses for the nine months ended
September 30, 1997 is unaudited; however, in the opinion of management,
all adjustments necessary for the fair presentation of the statement of
revenues and certain expenses for such interim period have been included.
The results for the nine months ended September 30, 1997 are not
necessarily indicative of the results to be obtained for the year ending
December 31, 1997.
INCOME RECOGNITION
The multifamily property has operating leases with terms generally of one
year or less. Rental income is recognized when earned.
ESTIMATES
The preparation of a financial statement in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses
during the reporting period. The ultimate results could differ from
those estimates.
-6-
<PAGE>
FINANCIAL STATEMENT AND
INDEPENDENT AUDITORS' REPORT
COUNTRY LAKES ASSOCIATES TWO
A LIMITED PARTNERSHIP
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<PAGE>
Country Lakes Associates Two
A Limited Partnership
TABLE OF CONTENTS
PAGE
INDEPENDENT AUDITORS' REPORT 3
FINANCIAL STATEMENT
STATEMENT OF REVENUES AND CERTAIN EXPENSES 4
NOTES TO STATEMENT OF REVENUES AND CERTAIN EXPENSES 5
<PAGE>
[LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
NHP Incorporated
We have audited the accompanying statement of revenues and certain expenses
of Country Lakes Associates Two, A Limited Partnership, for the years ended
December 31, 1996, 1995 and 1994. This financial statement is the
responsibility of NHP Incorporated. Our responsibility is to express an opinion
on the statement of revenues and certain expenses based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform our audit to obtain
reasonable assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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.
The accompanying statement of revenues and certain expenses was prepared in
compliance with the rules and regulations of the Securities and Exchange
Commission and, as described in Note A, is not intended to be a complete
presentation of the property's revenues and expenses.
In our opinion, the financial statement referred to above presents fairly,
in all material respects, the revenues and certain expenses of the property, for
the years ended December 31, 1996, 1995 and 1994, in conformity with generally
accepted accounting principles.
/s/ Reznick Fedder & Silverman
Bethesda, Maryland
December 11, 1997
-3-
<PAGE>
COUNTRY LAKES ASSOCIATES TWO
A LIMITED PARTNERSHIP
STATEMENT OF REVENUES AND CERTAIN EXPENSES
<TABLE>
<CAPTION>
For the Nine Months
Ended September 30, 1997 For the Year Ended For the Year Ended For the Year Ended
(unaudited) December 31, 1996 December 31, 1995 December 31, 1994
------------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
REVENUES:
Rental income $ 2,470,833 $ 3,532,484 $ 3,445,209 $ 3,314,666
Other income 60,840 132,172 129,926 157,192
------------------------ ------------------ ------------------ ------------------
Total Revenues 2,531,673 3,664,656 3,575,135 3,471,858
------------------------ ------------------ ------------------ ------------------
CERTAIN EXPENSES:
Leasing 49,959 31,106 33,992 78,199
Payroll and benefits 229,749 247,183 229,163 219.488
General and administrative 34,934 354,700 336,471 416,834
Management fees 100,546 141,899 138,739 132,140
Utilities 128,171 150,440 145,059 164,312
Repairs and maintenance 196,466 188,471 118,033 235,024
Janitorial 27,670 20,565 17,740 25,400
Painting and decorating 61,354 89,933 94,712 90,152
Insurance 34,791 48,421 48,494 40,402
Payroll taxes 19,161 23,523 22,579 21,231
Real estate taxes 315,290 376,325 330,858 370,672
------------------------ ------------------ ------------------ ------------------
Total Certain Expenses 1,198,091 1,672,566 1,515,840 1,793,854
------------------------ ------------------ ------------------ ------------------
REVENUES IN EXCESS OF
CERTAIN EXPENSES $ 1,333,582 $ 1,992,090 $ 2,059,295 $ 1,678,004
------------------------ ------------------ ------------------ ------------------
------------------------ ------------------ ------------------ ------------------
</TABLE>
See notes to Statement of Revenues and Certain Expenses
-4-
<PAGE>
Country Lakes Associates Two
A Limited Partnership
NOTES TO SCHEDULE OF REVENUES AND CERTAIN EXPENSES
Years ended December 31, 1996, 1995 and 1994
NOTE A - ORGANIZATION AND BASIS OF PRESENTATION
ORGANIZATION
The accompanying statement of revenues and certain expenses (the statement)
includes the operations of Country Lakes Associates Two, A Limited
Partnership (the property), owned by NHP Incorporated.
Apartment Investment and Management Company (AIMC0), an unaffiliated party
to the property, has entered into a Purchase and Sale Agreement related to
the acquisition of the property through AIMCO Properties, L.P. (the
operating partnership). A wholly-owned subsidiary of AIMCO is the sole
general partner and a wholly-owned subsidiary of AIMCO is a limited partner
which owns a majority interest in the operating partnership. The property
consists of 240 units located in Naperville, Illinois, and is currently
operating under the name Greens of Naperville.
The property will be acquired for cash and the assumption of debt.
BASIS OF PRESENTATION
The accompanying statement was prepared to comply with the rules and
regulations of the Securities and Exchange Commission (the SEC).
The accompanying statement is not representative of the actual operations
for the period presented as certain revenues and expenses have been
excluded that may not be comparable to the revenues and expenses expected
to be incurred by the operating partnership in the proposed future
operations of the property. Revenues excluded consist of interest income.
Expenses excluded consist of depreciation, amortization, interest on
non-assumed debt and other costs not directly related to the expected
future operations of the property.
-5-
<PAGE>
Country Lakes Associates Two
A Limited Partnership
NOTES TO STATMENT OF REVENUES AND CERTAIN EXPENSES -
CONTINUED
Years ended December 31, 1996, 1995 and 1994
NOTE A - ORGANIZATION AND BASIS OF PRESENTATION (Continued)
INTERIM UNAUDITED STATEMENT OF REVENUES AND CERTAIN EXPENSES
The statement of revenues and certain expenses for the nine months ended
September 30, 1997 is unaudited, however; in the opinion of management, all
adjustments necessary for the fair presentation of the statement of
revenues and certain expenses for such interim period have been included.
The results for the nine months ended September 30, 1997 are not
necessarily indicative of the results to be obtained for the year ending
December 31, 1997.
INCOME RECOGNITION
The multifamily property has operating leases with terms generally of one
year or less. Rental income is recognized when earned.
ESTIMATES
The preparation of a financial statement in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses
during the reporting period. The ultimate results could differ from those
estimates.
-6-
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Partners of
Point West Limited Partnership
Washington, DC
We have audited the accompanying statements of revenues and certain expenses
of Point West Limited Partnership, A Limited Partnership, 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 the statements of revenues and certain expenses based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform our 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 audits provide a
reasonable basis for our opinion.
The accompanying statements of revenues and certain expenses were prepared in
compliance with the rules and regulations of the Securities and Exchange
Commission and, as described in Note 1, are not intended to be a complete
presentation of Point West Limited Partnership's revenues and expenses.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the revenues and certain expenses of Point West Limited
Partnership, as described in Note 1, for the years ended December 31, 1996,
1995 and 1994 in conformity with generally accepted accounting principles.
/s/ Deloitte & Touche LLP
McLean, Virginia
December 15, 1997
<PAGE>
POINT WEST LIMITED PARTNERSHIP
A LIMITED PARTNERSHIP
- ------------------------------
<TABLE>
<CAPTION>
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
- ----------------------------------------------------------------------------------------------------------------------------
For the Nine Months Ended
September 30, 1997 For the Year Ended For the Year Ended For the Year Ended
(Unaudited) December 31, 1996 December 31, 1995 December 31, 1994
------------------------- ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
REVENUES:
Rental $ 848,025 $ 1,106,478 $ 1,064,136 $ 1,038,295
Financial 28,094 44,999 29,201 5,495
Other 39,722 56,246 58,095 51,097
--------- ----------- ----------- -----------
Total revenue 915,841 1,207,723 1,151,432 1,094,887
--------- ----------- ----------- -----------
CERTAIN EXPENSES:
Administrative 150,631 220,281 193,662 200,520
Utilities 38,103 47,119 60,118 62,441
Operating and maintenance 140,854 155,312 147,680 201,280
Taxes and Insurance 105,979 141,270 134,824 111,589
Interest 334,891 446,558 378,225 303,724
--------- ----------- ----------- -----------
Total certain expenses 770,458 1,010,540 914,509 879,554
--------- ----------- ----------- -----------
REVENUES IN EXCESS OF
CERTAIN EXPENSES $ 145,383 $ 197,183 $ 236,923 $ 215,333
--------- ----------- ----------- -----------
--------- ----------- ----------- -----------
</TABLE>
See notes to statements of revenues and certain expenses.
<PAGE>
POINT WEST LIMITED PARTNERSHIP
A LIMITED PARTNERSHIP
- ------------------------------
NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES
- ----------------------------------------------------------------------------
Note 1 -- ORGANIZATION AND BASIS OF PRESENTATION
ORGANIZATION
The Partnership was formed as a limited partnership under the laws of the
State of Kansas on November 5, 1985, for the purpose of constructing and
operating a 172 unit rental housing project in Lenexa, Kansas.
In September 1997, AIMCO Properties, L.P. ("Properties"), a Delaware limited
partnership and a subsidiary limited partnership of Apartment Investment and
Management Company, a Maryland corporation (the "Company"), acquired
approximately 61.88% of the limited partner interests in Point West Limited
Partnership (the "Partnership") as a result of a tender offer commenced on
June 30, 1997 and continuing through mid-November 1997. The units of limited
partnership interest were purchased for cash and OP Units valued at
approximately $379,000 in the aggregate. Properties used cash on hand to fund
the cash portion of the purchase price. A subsidiary of NHP Partners is the
general partner of the Partnership and thus a subsidiary of the Company and an
affiliate of Properties, and prior to the tender offer owned a 10.9% General
Partnership Interest in the Partnership.
BASIS OF PRESENTATION
The accompanying statements of revenues and certain expenses (the Statements)
were prepared to comply with the rules and regulations of the Securities and
Exchange Commission (the SEC).
The accompanying Statements are not representative of the actual operations
for the periods presented as certain revenues and expenses have been
excluded that may not be comparable to the revenues and expenses expected to
be incurred by the operating partnership in the proposed future operations of
Point West Limited Partnership. Revenues excluded consist of an extraordinary
gain of $859,662 recognized in 1995 related to the early extinguishment of
debt resulting from the refinancing of mortgage debt. Expenses excluded
consist of depreciation and amortization not directly related to the expected
future operations of Point West Limited Partnership.
INTERIM UNAUDITED STATEMENT OF REVENUES AND CERTAIN EXPENSES
The statement of revenues and certain expenses for the nine months ended
September 30, 1997 is unaudited, however, in the opinion of management, all
adjustments necessary for the fair presentation of the statement of revenues
and certain expenses for such interim period have been included. The results
for the nine months ended September 30, 1997 are not necessarily indicative
of the results to be obtained for the year ending December 31, 1997.
<PAGE>
INCOME RECOGNITION
The Partnership has operating leases with terms generally of one year or less.
Rental income is recognized when earned.
ESTIMATES
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of revenues and expenses during the
reporting period. The ultimate results could differ from those estimates.
Note 2 - RELATED PARTY TRANSACTIONS
NHP Management Company (NHPMC), a wholly owned subsidiary of the Company, is
the project management agent under an agreement which extends, subject to
certain conditions, to the year 2020.
Personnel working at the project site are employees of NHP Incorporated, a
wholly owned subsidiary of the Company. The project reimbursed NHP
Incorporated for the actual salaries and related benefits. During 1996, 1995
and 1994, NHPMC received a fee for its services equal to 5% of the project's
rental collections. In addition, NHPMC and other affiliates of NHP received
$16,246, $14,992 and $14,575, in 1996, 1995 and 1994, respectively, for
services provided to the project.
<PAGE>
THE OAK PARK PARTNERSHIP
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEARS ENDED
DECEMBER 31, 1996, 1995 AND 1994
<PAGE>
THE OAK PARK PARTNERSHIP
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INDEPENDENT AUDITORS' REPORT ........................................... 3
STATEMENTS OF REVENUES AND CERTAIN EXPENSES............................. 4
NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES.................... 5-7
<PAGE>
[LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
To the Partners of
The Oak Park Partnership
We have audited the accompanying statements of revenues and certain
expenses of THE OAK PARK PARTNERSHIP (an Illinois Limited Partnership), as
defined in Note 1, 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 the statements
of revenues and certain expenses based on our audits.
We conducted our audits 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 audits
provide a reasonable basis for our opinion.
The accompanying statements of revenues and certain expenses were prepared
in compliance with the rules and regulations of the Securities and Exchange
Commission and, as described in Note 1, are not intended to be a complete
presentation of THE OAK PARK PARTNERSHIP'S revenues and expenses.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the revenues and certain expenses of THE OAK PARK
PARTNERSHIP, as described in Note 1, for the years ended December 31, 1996,
1995 and 1994, in conformity with generally accepted accounting principles.
/s/ WARADY & DAVIS LLP
December 11, 1997
<PAGE>
THE OAK PARK PARTNERSHIP
- -------------------------------------------------------------------------------
STATEMENTS OF REVENUES AND CERTAIN EXPENSES (NOTE 1)
<TABLE>
<CAPTION>
(Unaudited)
For the Nine (Audited) (Audited) (Audited)
Months Ended For the Year Ended For the Year Ended For the Year Ended
September 30, 1997 December 31, 1996 December 31, 1995 December 31, 1994
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES
Rental Income $ 2,594,100 $ 3,358,978 $ 3,257,261 $ 3,229,196
Less Vacancy Losses 116,409 212,113 150,864 140,693
---------------- ---------------- ---------------- ---------------
2,477,691 3,146,865 3,106,397 3,088,503
Other Income 82,308 107,560 158,195 109,300
---------------- ---------------- ---------------- ---------------
2,559,999 3,254,425 3,264,592 3,197,803
---------------- ---------------- ---------------- ---------------
Expenses
Administrative Expenses 282,690 371,479 431,254 545,776
Utilities Expense 127,779 147,084 134,461 119,896
Operating and Maintenance 397,021 445,017 340,166 307,522
Taxes and Insurance 434,199 555,695 599,742 490,912
Financial Expenses 830,896 1,120,000 1,120,000 1,120,000
---------------- ---------------- ---------------- ---------------
2,072,085 2,639,275 2,625,623 2,584,106
---------------- ---------------- ---------------- ---------------
REVENUES IN EXCESS
OF CERTAIN EXPENSES $ 487,414 $ 615,150 $ 638,969 $ 613,697
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to Statements of Revenues and Certain Expenses.
4
<PAGE>
THE OAK PARK PARTNERSHIP
- -------------------------------------------------------------------------------
NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES
- -------------------------------------------------------------------------------
NOTE 1--ORGANIZATION AND BASIS OF PRESENTATION
ORGANIZATION
The accompanying statements of revenues and certain expenses (the Statements)
include the operations of a 234-unit multifamily apartment community and
8,335 square feet of commercial rental property owned by The Oak Park
Partnership.
During 1997, Apartment Investment and Management Company (AIMCO) acquired all
of the general partners interest representing 2.0% and 83.17% of the limited
partners interests for total ownership in the partnership of 85.17%. Due to
these acquisitions and pursuant to generally accepted accounting principles,
AIMCO will have to include in its financial statements the financial
position, results of operations and cash flows of the Partnership.
BASIS OF PRESENTATION
The accompanying statements were prepared to comply with the rules and
regulations of the Securities and Exchange Commission (the SEC).
The accompanying statements are not representative of the actual operations
for the periods presented as certain revenues and expenses have been excluded
that may not be comparable to the revenues and expenses expected to be
incurred by the Operating Partnership in the proposed future operations of
The Oak Park Partnership. Revenues excluded consists of interest income.
Expenses excluded consist of depreciation, amortization, interest on
non-assumed debt and other costs not directly related to the expected future
operations of The Oak Park Partnership.
INTERIM UNAUDITED STATEMENT OF REVENUES AND CERTAIN EXPENSES
The statement of revenues and certain expenses for the nine months ended
September 30, 1997 is unaudited. However, in the opinion of management, all
adjustments necessary for the fair presentation of the statement of revenues
and certain expenses for such interim period have been included. The results
for the nine months ended September 30, 1997 are not necessarily indicative of
the results to be obtained for the year ending December 31, 1997.
INCOME RECOGNITION
The multifamily apartments have operating leases with terms generally of one
year or less. Commercial space also has operating leases with terms which
range from two to four years. Rental income is recognized when earned.
ESTIMATES
The preparation of a financial statement in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of revenues and expenses during the
reporting period. The ultimate results could differ from those estimates.
5
<PAGE>
THE OAK PARK PARTNERSHIP
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NOTE 2--RELATED PARTY TRANSACTIONS
Pursuant to a management agreement, the property is managed by NHP Management
Company, an affiliate of AIMCO. The Partnership pays management fees at the
rate of 3.25% of gross rental collections.
NOTE 3--SIGNIFICANT TRANSACTIONS
On July 16, 1996 the Partnership refinanced its Mortgage Note Payable and
Note Payable to the Village of Oak Park. These transactions are described
below:
MORTGAGE NOTE PAYABLE
During 1996, NHP successfully renegotiated with the bondholders and the
Village of Oak Park to enter into an agreement which allowed the Partnership
to extinguish bond indebtedness of $15,990,000, related collateralized credit
instrument and restructure the Village of Oak Park note payable obligation
(see below). The renegotiations resulted in a discount to the partnership in
excess of $2,970,000 on its third party debt obligations. Such discount is not
reflected in the Statements.
On July 16, 1996, the Partnership refinanced these obligations with a new
$15,700,000 Multifamily Housing Reverance Refunding Bond Obligation issued by
the Village of Oak Park. The bonds in the amount of $15,700,000 were used to
fund a first mortgage loan to the Partnership and simultaneously, the
mortgage loan was assigned to the Federal National Mortgage Association in
exchange for a Guaranteed Mortgage Pass-through Certificate.
The first mortgage note bears interest at the rate of 6.81% per annum and the
monthly principal and interest payment is $100,373. The term of the loan is
30 years and matures on August 1, 2026. During the first ten years, the note
may be prepaid by payment of a prepayment premium in the first year of 6.83%
of the note balance and annually declines to .80% in the tenth year. No
prepayment premium is due after the tenth year through the maturity date.
The Partnership is required to remarket the bonds after ten years and before
September 1, 2006 ("remarketing date"). Upon remarketing the underlying
bonds, the Partnership shall pay interest on the mortgage note payable equal
to the Remarketing Rate plus .85% and an additional amount sufficient to pay
any unpaid remarketing costs (expressed as a percentage), if any. If the
bonds are not remarketed the new interest rate shall be 12% per annum plus
.85% and an additional amount sufficient to pay any unpaid costs (expressed as
a percentage), if any. Monthly payment of principal and interest will be
adjusted the month after the remarketing date to an amount which will
amortize the remaining principal balance over the balance of the loan term at
the interest rate then in effect on the note.
The first mortgage loan is nonrecourse and is collateralized by a first
mortgage on the real estate, improvements and personal property. The
Partnership is also required to make monthly payments into a real estate tax
escrow, insurance escrow and replacement reserve escrow of $47,151, $1,708,
and $2,925, respectively.
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THE OAK PARK PARTNERSHIP
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NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES
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MORTGAGE NOTE PAYABLE (Continued)
As of December 31, 1996, the balance of the first mortgage loan is
$15,648,970.
Scheduled principal payments for the next five years are approximately as
follows:
1997.......................... $175,700
1998.......................... 187,600
1999.......................... 200,400
2000.......................... 214,100
2001.......................... 228,700
NOTES PAYABLE - VILLAGE OF OAK PARK
The Partnership originally issued a note payable to the Village of Oak Park
for the purchase of the land for the Project in the amount of $889,000. As of
December 31, 1995 the amount due on the note was $889,000 plus accrued
interest of approximately $799,000. As described in Note 5, the Partnership
refinanced the property on July 16, 1996. The Village of Oak Park received
$625,000 and reduced the amount due on the note for principal and interest to
$264,000.
The balance accrues interest at 8% per annum and
is due in installments of $132,000 on July 1, 1997 and 1998......... $264,000
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ADVANCES FROM PARTNER
Advances from NHP consist of the following:
Date Interest
Partner Incurred Rate Amount
- --------------- --------------- ------------- -----------
NHP 1989-1990 Prime + 2% $557,899
In 1996, proceeds from the refinancing of $210,814 was used to repay advances
from partners.
The financial expenses have been adjusted to $1,120,000 to reflect interest
expense that would have been incurred under the terms of the refinanced
Mortgage Note, Note Payable - Village of Oak Park and Advances from Partners,
if such notes were in effect for the 1994, 1995 and 1996 calendar years.
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