<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
OR
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
COMMISSION FILE NUMBER 33-85492
--------------
CP LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
MARYLAND 38-3140664
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
19500 Hall Road, Clinton Township, Michigan 48038
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (810) 286-3600
Securities registered pursuant to section 12(b) of the Act
and listed on the New York Stock Exchange:
NONE
Securities registered pursuant to Section 12(g) of the Act:
NONE
Indicate by check mark whether the registrant: (l) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Act of 1934
during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [ ]
<PAGE> 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CP LIMITED PARTNERSHIP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE PERIODS ENDED JUNE 30, 1996 AND 1995
(DOLLARS IN THOUSANDS, EXCEPT PER OP UNIT DATA)
---------
<TABLE>
<CAPTION>
Second Quarter First Half
---------------- ----------------
1996 1995 1996 1995
------- ------- ------- -------
<S> <C> <C> <C> <C>
Revenues:
Rental income $16,111 $14,826 $31,850 $29,521
Interest and other income 718 445 1,370 988
------- ------- ------- -------
16,829 15,271 33,220 30,509
------- ------- ------- -------
Expenses:
Property operating and maintenance 4,955 4,110 9,009 7,667
Real estate taxes 1,190 1,109 2,375 2,182
Depreciation 2,911 2,725 5,679 5,438
Administrative 999 989 2,019 2,029
Interest and related amortization 3,175 3,091 6,218 6,227
------- ------- ------- -------
13,230 12,024 25,300 23,543
------- ------- ------- -------
Income before extraordinary item 3,599 3,247 7,920 6,966
Extraordinary charge from early
extinguishment of debt - - - (829)
------- ------- ------- -------
Net income $ 3,599 $ 3,247 $ 7,920 $ 6,137
======= ======= ======= =======
Net income attributed to:
General partner $ 1,473 $ 1,299 $ 3,243 $ 2,425
Limited partner 2,126 1,948 4,677 3,712
------- ------- ------- -------
$ 3,599 $ 3,247 $ 7,920 $ 6,137
======= ======= ======= =======
Earnings per OP unit outstanding:
Income before extraordinary item $ .24 $ .22 $ .53 $ .47
Extraordinary item - - - (.05)
------- ------- ------- -------
Net income $ .24 $ .22 $ .53 $ .42
======= ======= ======= =======
Distribution declared per OP unit outstanding $ .405 $ .375 $ .81 $ .75
======= ======= ======= =======
Weighted average OP units outstanding 14,896 14,724 14,892 14,742
======= ======= ======= =======
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE> 3
CP LIMITED PARTNERSHIP
CONDENSED CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
-------
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
-------- ------------
ASSETS
<S> <C> <C>
Rental property:
Land $ 33,682 $ 32,891
Land and improvements for expansion sites 3,250 2,434
Depreciable property 250,331 241,098
-------- --------
287,263 276,423
Less accumulated depreciation (75,520) (69,868)
-------- --------
211,743 206,555
Cash and cash equivalents 261 944
Receivables 1,678 2,142
Prepaid expenses and other assets 4,372 2,393
-------- --------
Total assets $218,054 $212,034
======== ========
LIABILITIES
Debt $141,298 $132,700
Accounts payable and accrued expenses 8,609 8,444
Tenants' security deposits and rents received in advance 4,564 4,364
Distributions payable 6,031 5,954
-------- --------
Total liabilities 160,502 151,462
PARTNERS' CAPITAL, Unlimited Authorized Units;
14,936,021 and 14,886,214 OP units outstanding at
June 30, 1996 and December 31, 1995, respectively
General partner 23,015 24,308
Limited partners 34,537 36,264
-------- --------
Total partners' capital 57,552 60,572
-------- --------
Total liabilities and partners' capital $218,054 $212,034
======== ========
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE> 4
CP LIMITED PARTNERSHIP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIODS ENDED JUNE 30, 1996 AND 1995
(DOLLARS IN THOUSANDS)
-------
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------
1996 1995
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 7,920 $ 6,137
Adjustments to reconcile to net cash
provided by operating activities:
Extraordinary item - 829
Depreciation 5,679 5,438
Amortization of deferred financing costs 220 264
Decrease (increase) in operating assets (735) 72
Increase (decrease) in operating liabilities 365 2,068
-------- --------
Net cash from operating activities 13,449 14,808
Cash flow from financing activities:
Proceeds from issuance of 8 3/4% Senior Notes - 74,866
Net borrowing (repayments) on line of credit 9,200 (28,900)
Repayment of mortgages - (43,952)
Prepayment penalties - (667)
Principal payments (602) (641)
Payment of deferred financing costs - (933)
Distributions to OP unit holders (11,984) (10,930)
OP units reacquired (932) (867)
Other financing activities 89 85
-------- --------
Net cash used in financing activities (4,229) (11,939)
Cash flow from investing activities:
Acquisitions of rental properties (8,252) -
Additions to rental property (1,651) (1,527)
-------- --------
Net cash used in investing activities (9,903) (1,527)
Increase (decrease) in cash and cash equivalents (683) 1,342
Cash and cash equivalents, beginning of period 944 3,370
-------- --------
Cash and cash equivalents, end of period $ 261 $ 4,712
======== ========
Supplemental cash flow information:
OP units issued for rental property and joint
venture investment $ 1,964 $ -
======== ========
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE> 5
CP LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
--------
1. BASIS OF PRESENTATION AND FORMATION OF COMPANY:
The accompanying unaudited condensed consolidated financial statements
of CP Limited Partnership (the "Company"), have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all
adjustments considered necessary for a fair presentation have been included,
and such adjustments are of a normal recurring nature. The year-end
condensed consolidated balance sheet was derived from audited consolidated
financial statements, but does not include all disclosures required by
generally accepted accounting principles. For further information, refer to
the consolidated/combined financial statements and footnotes thereto
included in the Company's annual report on Form 10-K for the year ended
December 31, 1995.
Chateau Properties, Inc. ("Chateau"), a Real Estate Investment Trust
("REIT"), is the sole general partner of the Company. On November 23,
1993, Chateau completed a public offering of 5,700,000 shares of $.01 par
value common stock (the "IPO"). Simultaneous with the IPO, Chateau
contributed the net proceeds from the IPO and was admitted as sole general
partner in the Company. The accompanying financial statements include the
accounts of the Company and its six 99 percent owned subsidiary
partnerships. All significant inter-entity balances and transactions have
been eliminated in consolidation. Minority interests represented by
Chateau's one percent interest in the aforementioned six partnerships is
not separately recognized in the Company's financial statements because the
Company reimburses Chateau for all of its expenses in excess of the income
Chateau earns through its one percent interest.
In order to permit the Chateau's qualification as a REIT under the Internal
Revenue Code, the operations of four golf courses and a marina were
previously conducted by GC Properties, Inc. ("GCI"), a corporation wholly
owned by a limited partner of the Company. From November 23, 1993 through
December 31, 1995, the Company recognized net lease income from GCI which
was classified as other income. In early 1996, Chateau received a ruling
from the Internal Revenue Service allowing it to conduct these operations.
Effective January 1, 1996, as a result of acquiring the operations of GCI,
the Company has consolidated these operations. For the six months ended
June 30, 1996 the Company has included approximately $776,000 in revenues
and $494,000 in operating expenses for these operations.
Continued
<PAGE> 6
CP LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS, Continued
-------
2. EQUITY TRANSACTIONS:
On April 10, 1996, the Company purchased and retired 43,334 OP units that
were issued in connection with the acquisition of seven communities in
November 1994. The purchase, at $21.50 per unit, was made pursuant to the
terms of the purchase agreements.
On May 16, 1996, the Company declared a cash distribution of $.405 per OP
unit to OP unit holders of record as of June 24, 1996. The distribution was
paid on July 15, 1996 and is included in distributions payable in the
accompanying condensed consolidated balance sheet as of June 30, 1996.
On February 29, 1996 the Company declared a cash distribution of $.405 per
OP unit to OP unit holders of record as of March 22, 1996. The distribution
was paid on April 15, 1996.
On November 19, 1995, the Company declared a cash distribution of $.40 per
OP unit to OP unit holders of record as of December 22, 1995. The
distribution was paid on January 13, 1996 and is included in distributions
payable in the accompanying condensed consolidated balance sheet as of
December 31, 1995.
3. ACQUISITIONS OF RENTAL PROPERTY:
On May 16, 1996, the Company acquired two communities in Manteno, Illinois.
The communities, Maple Valley and Maple Ridge have a combined total of 276
sites. The purchase price of approximately $5.8 million was paid with
approximately $4.8 million in cash, which was borrowed on the Company's line
of credit and approximately $1.0 million through the issuance of 43,884 OP
units.
In connection with the above acquisition, the Company issued an additional
45,506 OP units in return for an investment interest in a joint venture. The
joint venture is currently developing four additional communities
aggregating 2,000 new homesites. The Company may guarantee up to $8 million
of debt of the joint venture in return for a guarantee fee. Also, the
Company will have first rights to purchase the communities when they reach
95 percent occupancy.
Continued
<PAGE> 7
CP LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS, Continued
-------
3. ACQUISITIONS OF RENTAL PROPERTY, CONTINUED:
On March 27, 1996, the Company acquired 134 occupied sites in the Chestnut
Creek Farm community in Davison, Michigan. The purchase price was
approximately $3.4 million, paid in cash, and was financed through a
borrowing on the Company's line of credit. The Company will acquire
approximately 300 additional sites as they are developed and leased by the
seller.
4. DEBT:
The following table sets forth certain information regarding debt at June
30, 1996:
<TABLE>
<CAPTION>
Interest Rate Maturity Date Principal Balance
------------- ------------- -----------------
<S> <C> <C> <C>
Fixed Rate Mortgages:
Del Tura 8.40% 6/00 $ 33,594
Macomb 9.82% 9/99 16,495
Norton Shores/Ferrand Estates 8.00% 4/99 3,580
Oak Hill 8.00% 9/98 1,273
Other Indebtedness:
Unsecured Senior Notes 8.79% 3/00 75,000
Unsecured Line of Credit - 1/99 9,200
Other notes payable various 1996-2020 2,156
--------
$141,298
========
</TABLE>
5. SUBSEQUENT EVENTS:
In July 1996, Chateau and ROC Communities, Inc. ("ROC") signed a definitive
agreement to merge the two companies into a new company called Chateau
Communities, Inc. through a tax-free exchange of stock. Under the terms of
the agreement, the shareholders of Chateau will receive one share of common
stock of Chateau Communities, Inc. for every share they currently hold in
Chateau. OP unit holders of the Company will continue to hold OP units in
the Company. ROC shareholders will receive 1.042 shares of Chateau
Communities, Inc.'s common stock for every share they currently hold in ROC.
The merger is expected to be completed in the fourth quarter of 1996 and is
subject to approval by the shareholders of both companies as well as
customary regulatory and other conditions.
<PAGE> 8
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion and analysis of interim results of operations and
financial condition covers the quarter and first half ended June 30, 1996 and
1995 and should be read in conjunction with the Condensed Consolidated
Financial Statements and Notes thereto included in this report.
RESULTS OF OPERATIONS
Comparison of quarter ended June 30, 1996 to quarter ended June 30, 1995
For the quarter ended June 30, 1996, net income was $3,599,000, an increase of
$352,000 from the same period in 1995. The increase was due primarily to
increases in net operating income from communities owned by the Company as of
June 30, 1995 and to a lesser extent the acquisition of four communities since
June 30, 1995.
Rental revenue in the second quarter 1996 was $16,111,000, an increase of
approximately $1,285,000 or 8.7 percent from second quarter 1995.
Approximately 32 percent of the increase was due to the acquisition of four
communities since June 30, 1995, 42 percent represented the effect of rent
increases and 26 percent was caused by increased occupancy. Weighted average
occupancy for the second quarter 1996 was 18,854 sites, or 5.4 percent higher
than weighted average occupancy for the second quarter 1995. On a per site
basis, weighted average monthly rental revenue for the second quarter 1996
increased to $285 from $276 in 1995, or 3.1 percent. The occupancy rate was
95.1 percent as of June 30, 1996 on 20,003 sites, increased from 93.1 percent
as of June 30, 1995 on 19,263 sites.
Interest and other income increased approximately $273,000 or 62 percent in
1996 from 1995. The increase is due to the inclusion of the results of
operations of four golf courses and a marina for the period beginning January
1, 1996. These operations were previously conducted by GC Properties, Inc.
("GCI"), a corporation wholly owned by a limited partner of the Company, in
order to permit Chateau Properties, Inc.'s ("Chateau") qualification as a REIT
under the Internal Revenue Code. From November 23, 1993 through December 31,
1995, the Company recognized net lease income from GCI which was classified as
other income. In early 1996, Chateau received a ruling from the Internal
Revenue Service allowing it to conduct these operations. Effective January 1,
1996, as a result of acquiring the operations of GCI, the Company has
consolidated these operations. The increase of $296,000 due to the inclusion
of the golf course and marina revenues, was partially offset by a decrease in
interest income of $35,000 due to the Company having less available cash to
invest in the second quarter of 1996.
Property operating and maintenance expense for the second quarter 1996
increased approximately $845,000 or 21 percent from the same period a year ago.
Approximately $267,000 of the increase represents the operating costs of the
golf course and marina operations as discussed above. Excluding the operating
expenses of the golf course and
<PAGE> 9
marina operations, property operating and maintenance expense increased 14
percent. The remaining increase is due to the acquisition of four communities
over the last year and increases at communities owned as of June 30, 1995. On
a per site basis, monthly weighted average property operating and maintenance
expense increased from $77 in 1995 to $88 in 1996, or 14 percent. The increase
on a per site basis, excluding the golf course and marina operations, was 8.2
percent due primarily to timing of repairs and maintenance spending in 1996 as
compared with 1995.
Real estate taxes in second quarter 1996 increased $81,000 or 7.3 percent from
second quarter 1995. The increase is due primarily to acquisitions and
expansions of communities. On a per site basis, monthly weighted average real
estate taxes were $21.03 in 1996 compared to $20.66 in 1995, an increase of 1.8
percent. The increase was due to general tax increases. Real estate taxes may
increase or decrease due to inflation, expansions and improvements of
communities, as well as changes in taxation in the tax jurisdictions in which
the Company operates.
Administrative expense for second quarter 1996 increased $10,000 from 1995.
Administrative expense in 1996 was 5.9 percent of revenues as compared to 6.5
percent in 1995.
Interest and related amortization costs increased for second quarter 1996 by
$84,000 or 3 percent from second quarter 1995. Interest expense as a percentage
of average debt outstanding remained relatively stable at 8.8 percent.
Depreciation expense in second quarter 1996 increased $186,000 or 7 percent.
The increase is due to the acquisitions and expansions of communities.
Depreciation expense as a percentage of average depreciable rental property in
1996 from 1995 remained relatively constant.
Comparison of first half ended June 30, 1996 to first half ended June 30, 1995
For the first half ended June 30, 1996, net income was $7,920,000, an increase
of $954,000 from the same period in 1995. The increase was due primarily to
increases in net operating income from communities owned by the Company as of
June 30, 1995 and to a lesser extent the acquisition of four communities since
June 30, 1995. In the first quarter 1995, the Company recognized an
extraordinary charge of $829,000 related to the early extinguishment of debt.
Rental revenue in the first half 1996 was $31,850,000, an increase of
approximately $2,329,000 or 7.9 percent from first half 1995. Approximately 28
percent of the increase was due to the acquisition of four communities since
June 30, 1995, 44 percent represented the effect of annual rent increases and
28 percent was caused by increased occupancy. Weighted average occupancy for
the first half 1996 was 18,700 sites, or 4.7 percent higher than weighted
average occupancy for the first half 1995. On a per site basis, weighted
average monthly rental revenue for the first half 1996 increased to $284 from
$276 in 1995, or 3.0 percent.
<PAGE> 10
Interest and other income increased approximately $382,000 or 39 percent in
1996 from 1995. The increase is due to the inclusion of the results of
operations of four golf courses and a marina for the period beginning January
1, 1996. These operations were previously conducted by GC Properties, Inc.
("GCI"), a corporation wholly owned by a limited partner of the Company, in
order to permit Chateau's qualification as a REIT under the Internal Revenue
Code. From November 23, 1993 through December 31, 1995, the Company recognized
net lease income from GCI which was classified as other income. In early 1996,
Chateau received a ruling from the Internal Revenue Service allowing it to
conduct these operations. Effective January 1, 1996, as a result of acquiring
the operations of GCI, the Company has consolidated these operations. The
increase of $510,000 due to the inclusion of the golf course and marina
revenues, was partially offset by a decrease in interest income of $145,000 due
to the Company having less available cash to invest in the first half of 1996.
Property operating and maintenance expense for the first half 1996 increased
approximately $1,342,000 or 17.5 percent from the same period a year ago.
Approximately $494,000 of the increase represents the operating costs of the
golf course and marina operations as discussed above. Excluding the operating
expenses of the golf course and marina operations, property operating and
maintenance expense increased 11.1 percent. The remaining increase is due to
the acquisition of four communities since June 30, 1995 and increases at
communities owned as of June 30, 1995. On a per site basis, monthly weighted
average property operating and maintenance expense increased from $72 in 1995
to $80 in 1996, or 12.2 percent. The increase on a per site basis, excluding
the golf course and marina operations, was 6.1 percent due primarily to timing
of repairs and maintenance spending in 1996 as compared with 1995.
Real estate taxes for the first half 1996 increased $193,000 or 8.8 percent
from first half 1995. The increase is due primarily to acquisitions and
expansions of communities. On a per site basis, monthly weighted average real
estate taxes were $21 in 1996 compared to $20 in 1995, an increase of 4.0
percent due to general tax increases. Real estate taxes may increase or
decrease due to inflation, expansions and improvements of communities, as well
as changes in taxation in the tax jurisdictions in which the Company operates.
Administrative expense for first half 1996 remained relatively constant from
1995. Administrative expense in 1996 was 6.1 percent of revenues as compared
to 6.7 percent in 1995.
Interest and related amortization costs remained relatively unchanged for first
half 1996. Interest expense as a percentage of average debt outstanding
decreased in 1996 due to debt refinancing that occurred in first quarter 1995.
Depreciation expense in first half 1996 increased $241,000 or 4 percent.
Depreciation expense as a percentage of average depreciable rental property in
1996 remained relatively unchanged from 1995.
<PAGE> 11
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities was $13,449,000 for first half 1996
compared to $14,808,000 for first half 1995. The decrease in cash provided by
operating activities was due primarily to changes in operating assets and
liabilities.
Net cash used in financing activities for first half 1996 was $4,229,000
compared to $11,939,000 for first half 1995. The amount used in 1996 consisted
of distributions paid to OP unitholders of $11,984,000 and the payment of
$932,000 to reacquire 43,334 OP units offset by net borrowings of $9,200,000 on
the line of credit to fund the three acquisitions made during the period. The
OP units were reacquired at $21.50 per OP unit pursuant to the terms of
purchase agreements related to the November 1994 acquisition of seven
communities.
Net cash used in investing activities in first half 1996 was $9,903,000. This
amount represented the acquisition of 134 filled sites in the Chestnut Creek
Farm community on March 27, 1996, the acquisition of 276 filled sites in the
Maple Valley and Maple Ridge communities on May 16, 1996, capital expenditures
and construction costs. The Chestnut Creek acquisition was financed by
borrowings on the Company's line of credit. The Maple Valley and Maple Ridge
acquisition was financed with approximately $4.8 million borrowed on the line
of credit and approximately $1 million with the issuance of 43,884 OP units. In
connection with the above acquisition, the Company issued an additional 45,506
OP units in return for an investment interest in a joint venture. The joint
venture is currently developing four additional communities aggregating 2,000
new homesites. The Company may guarantee up to $8 million of debt of the joint
venture in return for a guarantee fee. Also, the Company will have first
rights to purchase the communities when they reach 95 percent occupancy.
For the first half 1996, construction and development costs approximated
$1,069,000, while recurring property capital expenditures, other than
construction and development costs, were approximately $436,000. Aggregate
property capital expenditures for 1996 are anticipated to be approximately
$600,000. Capital expenditures have historically been financed with funds from
operations and it is the Company's intention that such future expenditures will
be financed with funds from operations.
Future acquisitions of communities and land for development of sites will be
financed through borrowings on the line of credit, the issuance of additional
debt securities, contributions from Chateau resulting from Chateau's issuance
of additional equity securities, assumption of existing secured or unsecured
indebtedness, or the issuance of OP units. The development of expansion sites
will be financed primarily by cash flow from operations and borrowings on the
line of credit. Huntington National Bank, as lead agent, along with Bank of
America and NBD Bank, have agreed until January, 1999 to lend the Company up to
$50 million which, subject to customary conditions, is available to finance the
development of expansion sites, the acquisition of additional properties and
for general business obligations. This line of credit is unsecured and
currently bears interest at 150 basis points over LIBOR. At June 30, 1996,
$9,200,000 was outstanding under the line of credit.
<PAGE> 12
The Company expects to meet its short-term liquidity requirements through cash
flow from operations and, if necessary, borrowings under its line of credit.
The Company anticipates meeting its long-term liquidity requirements from
borrowings under the line of credit, proceeds from the issuance of additional
debt securities, contributions from Chateau resulting from Chateau's issuance
of additional equity securities and cash flows from operations.
OTHER
Management considers Funds from Operations ("FFO") to be a supplemental measure
of the Company's operating performance. FFO is defined by the National
Association of Real Estate Investment Trusts ("NAREIT") as net income excluding
financing costs and gains (or losses) from debt restructuring and sales of
property plus depreciation and amortization and other non-cash items. For all
periods, depreciation of rental property is the only non-cash item. FFO should
not be considered as an alternative to net income, as the primary indicator of
operating performance, or to cash flows as a measure of liquidity nor does it
indicate that cash flows are sufficient to fund all cash needs.
FFO for the second quarter 1996 was $6,486,000 (including depreciation of
$2,887,000) compared to $5,950,000 (including depreciation of $2,703,000) for
the same period in 1995, an increase of $536,000 or 9 percent. The increase in
FFO is due primarily to increased revenues of $1,558,000, partially offset by
increased operating and administrative expenses of $936,000.
FFO for the first half 1996 was $13,554,000 (including depreciation of
$5,634,000) compared to $12,359,000 (including depreciation of $5,393,000) for
the same period in 1995, an increase of $1,195,000 or 9.7 percent. The
increase in FFO is due to increased revenues of $2,711,000, partially offset by
increased operating and administrative expenses of $1,525,000.
In July 1996, Chateau and ROC Communities, Inc. ("ROC") signed a definitive
agreement to merge the two companies into a new company called Chateau
Communities, Inc. through a tax-free exchange of stock. Under the terms of the
agreement, the shareholders of Chateau will receive one share of common stock
of Chateau Communities, Inc. for every share they currently hold in Chateau.
OP unit holders of the Company will continue to hold OP units in the Company.
ROC shareholders will receive 1.042 shares of Chateau Communities, Inc.'s
common stock for every share they currently hold in ROC. The merger is
expected to be completed in the fourth quarter of 1996 and is subject to
approval by the shareholders of both companies as well as meeting customary
regulatory and other conditions.
<PAGE> 13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
There are no material legal proceedings.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters for a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
12 - Computation of Ratio of Earnings to Fixed Charges
27 - Financial Data Schedule
No Reports on Form 8-K were filed.
<PAGE> 14
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, and in the
capacities indicated, on the 14th day of August, 1996.
CP LIMITED PARTNERSHIP
By: Chateau Properties, Inc.
By: /s/ Tamara D. Fischer
----------------------------------
Tamara D. Fischer
Executive Vice President
and Chief Financial Officer
(Duly Authorized Officer and Principal
Financial and Accounting Officer)
<PAGE> 15
EXHIBIT
INDEX
Exhibit Number Exhibit Description
-------------- -------------------
12 Computation of Ratio of Earnings to Fixed Charges
27 Financial Data Schedule
<PAGE> 1
EXHIBIT 12
CP LIMITED PARTNERSHIP
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Company/
Company Predecessor Predecessor
----------------------------------------------- ------------ ----------------------------
For the Quarter For the Year For the Year For the Year For the Year For the Year
Ended Ended Ended Ended Ended Ended
June 30, December 31, December 31, December 31, December 31, December 31,
1996 1995 1994 1993 1992 1991
--------------- ------------ ------------ ------------ ------------ ------------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
EARNINGS:
Income before
extraordinary charges $3,599 $13,979 $14,897 $3,931 $2,921 $341
Fixed charges 3,194 12,488 6,027 12,708 14,334 14,626
------ ------- ------- ------- ------- -------
$6,793 $26,467 $20,924 $16,639 $17,255 $14,967
====== ======= ======= ======= ======= =======
FIXED CHARGES:
Interest expense $3,060 $11,914 $5,560 $12,381 $13,907 $14,206
Amortization of deferred
financing costs 115 538 436 296 396 386
Interest factor on rental
expense (1) 19 36 31 31 31 34
------ ------- ------- ------- ------- -------
$3,194 $12,488 $6,027 $12,708 $14,334 $14,626
====== ======= ======= ======= ======= =======
RATIO OF EARNINGS TO
FIXED CHARGES 2.13 2.12 3.47 1.31 1.20 1.02
====== ======= ======= ======= ======= =======
</TABLE>
(1) Amount represents one third of all rental expense (the proportion deemed
representative of the interest factor).
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
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0
0
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</TABLE>
