10-K 1 d96620e10-k.txt FORM 10-K FOR FISCAL YEAR END DECEMBER 31, 2001 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2001 ------------------------------------------------------ [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ---------------------- ---------------------- Commission file number 0-8914 --------------------- UNIVERSITY REAL ESTATE PARTNERSHIP V -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) California 95-3240567 -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 3811 Turtle Creek Blvd, Suite 1850, Dallas, Texas 75219 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) -------------------------------------------------------------------------------- (Former address, if changed since last report) Registrant's telephone number, including area code (214) 651-4000 ----------------------------- Securities registered pursuant to Section 12(b) of the Act: Not applicable Securities registered pursuant to Section 12 (g) of the Act: Limited Partnership Units Indicate by check mark whether the registrant, (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ ] No [X] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] Of the registrant's 34,253 Limited Partnership Units, 6,158 units are held by an affiliate of the registrant. The aggregate market value of units held by non-affiliates is not determinable since there is no public trading market for Limited Partnership Units. Documents Incorporated by Reference: None Exhibit Index: See Page 19 TOTAL OF 43 PAGES UNIVERSITY REAL ESTATE PARTNERSHIP V INDEX TO ANNUAL REPORT ON FORM 10-K
Item No. Page -------- ---- PART I 1 Business................................................................................................ 3 2 Property................................................................................................ 6 3 Legal Proceedings....................................................................................... 6 4 Submission of Matters to a Vote of Security Holders..................................................... 6 PART II 5 Market for Registrant's Units of Limited Partnership and Related Security Holder Matters................ 7 6 Selected Financial Data................................................................................. 8 7 Management's Discussion and Analysis of Financial Condition and Results of Operations................... 9 8 Consolidated Financial Statements and Supplementary Data................................................ 16 PART III 9 Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.................... 17 10 Directors and Executive Officers of the Registrant...................................................... 17 11 Executive Compensation.................................................................................. 17 12 Security Ownership of Certain Beneficial Owners and Management.......................................... 17 13 Certain Relationships and Related Transactions.......................................................... 18 PART IV 14 Exhibits, Consolidated Financial Statements Schedules and Reports on Form 8-K........................... 18
2 PART I ITEM 1. BUSINESS Organization University Real Estate Partnership V (the "Partnership" or "Registrant") was organized on August 12, 1977, as a limited partnership under the provisions of the California Uniform Limited Partnership Act. The general partners are OS General Partner Company ("OSGPC"), a Texas corporation, and OS Holdings, Inc. ("OS"), a Texas corporation. The principal place of business for the General Partners is 3811 Turtle Creek Blvd., Suite 1850, Dallas, Texas 75219. On January 6, 1978, a Registration Statement on Form S-11 was declared effective by the Securities and Exchange Commission pursuant to which the Partnership offered for sale an aggregate of $25,000,000 Income and Growth/Shelter Limited Partnership Units. The Limited Partnership Units represent equity interests in the Partnership and entitle the holders thereof to participate in certain allocations and distributions of the Partnership. The sale of Limited Partnership Units closed on July 13, 1978, with 34,800 Limited Partnership Units sold at $500 each for gross proceeds of $17,400,000. Of the Limited Partnership Units sold, 547 have subsequently been repurchased by the Partnership. Of the 34,253 Limited Partnership Units currently outstanding, 17,723 are Income Units and 16,530 are Growth/Shelter Units. Meridian Realty Advisors, Inc. ("MRA") is responsible for overseeing the management of the Partnership and is a related party to the General Partners (see Item 13). Business Plan It is the General Partners' intent to sell the property. Management began actively marketing the property for sale in October 2001 and subsequently recorded an impairment charge of $2,100,000 against the property based on various letters of intent to purchase the property and the estimated future cashflows to be generated by the property. The property is currently not providing sufficient net operating income to the Partnership to allow the Partnership to service all of its financial obligations due to the lower than anticipated occupancy rates. See Item 7 - "Management's Discussion and Analysis of Financial Condition and Results of Operations." The Registrant is engaged in the business of acquiring, holding, operating and selling real estate acquired. Accordingly, the presentation of information about industry segments is not applicable and would not be material to an understanding of the Registrant's business taken as a whole. Current Operations General: The Partnership's primary business is to own, operate and ultimately dispose of its portfolio of income-producing real properties for the benefit of its partners. The Partnership's only remaining real estate project is up for sale. The project, Superstition Park Apartments, was acquired on July 1, 1999. As of December 31, 2001, the property had a book value of $17,021,260, subsequent to management assessment of a $2,100,000 impairment charge against the property (including the write-down of the remaining, un-amortized, deferred borrowing costs of approximately $400,000). See Item 8 - Notes 4 and 6 to the consolidated financial statements. The Partnership sold Washington Towne Apartments on April 1, 1999. The proceeds from the sale of Washington Towne Apartments were used to acquire Superstition Park. Washington Towne Apartments: The Partnership sold Washington Towne Apartments on April 1, 1999 for $4,100,000. Net cash received totaled $1,914,994 and was placed into escrow until a like-kind apartment complex could be acquired on a tax-free basis. 3 (See Purchase of Superstition Park Apartments below.) The Partnership recognized a gain on the sale of Washington Towne Apartments of $2,212,935. A portion of the transaction was accounted for as a non-cash transaction in the accompanying consolidated statements of cash flows. Purchase of Superstition Park Apartments: On June 25, 1999, Meridian Superstition Park Investors, LLC ("MSPI"), an Arizona limited liability company, was formed as a wholly owned limited liability company by Washington Towne Apartments, LLC ("WTA"), a Georgia limited liability corporation, which is effectively wholly owned by the Partnership. WTA used the escrowed proceeds from the sale of Washington Towne Apartments for a like kind exchange. On July 1, 1999, WTA purchased Superstition Park Apartments for $20,400,000 with the escrowed proceeds and mortgage notes in the amount of $18,630,000. These mortgage notes were to mature on June 30, 2004 and bore interest at LIBOR plus 3.25%. On July 13, 1999, in order to consummate refinancing with a new lender, the Partnership entered into an agreement with Meridian Equity Investors, LP ("MEI"), a Texas limited partnership, in order to operate Meridian Multi-Family Investors 99-IV ("MMFI 99-IV") pursuant to the Limited Partnership Act. The Partnership contributed to MMFI 99-IV its 99% member interest in WTA. As a result the Partnership owns a 99% General Partner interest (both Class A and Class B) in MMFI 99-IV while MEI owns the remaining 1% General Partner interest (both Class A and Class B). MEI is owned by affiliates of the General Partner of the Partnership. On July 20, 1999, the Partnership assigned 99% of the 100 shares of capital stock it owned in Washington Towne, Inc. ("WT") to MSP Genpar, Inc. ("MSP"), a Texas corporation, in order to satisfy the new lender's structural requirements with respect to the refinancing of Superstition Park Apartments. The Partnership retained 1 share of capital stock in WT. In return for the assignment of 99 shares of stock to MSP, the Partnership receives all of the economic benefit that is normally allocated to MSP. MSP is owned by affiliates of the General Partner of the Partnership. After the stock transfer, WT assigned 0.99% of its 1% member interest in WTA to MMFI 99-IV. Therefore, WT is the 0.01% managing member of WTA and MMFI 99-IV is 99.99% member of WTA. On December 15, 1999, the mortgage notes were refinanced with the new lender, in the principal amount of $16,000,000, bearing interest at 7.765%, secured by Superstition Park Apartments, payable in monthly installments of principal and interest of $114,792 and maturing January 2010. In addition to this new note, the MMFI 99-IV entered into an agreement to sell 10% non-recourse participating notes, maturing December 31, 2004 with interest payable quarterly, in the amount of $4,050,000. These 10% non-recourse general obligation promissory notes are secured by a security interest in the Partnership's 0.1% Class B voting limited partnership interest in MMFI 99-IV. The collateral does not include the Partnership's 98.9% Class A non-voting limited partnership interest in MMFI 99-IV. MEI and MSP are effectively minority interest partners. In accordance with various provisions of the Partnership's limited partnership agreement, no income (loss) allocations or cash distributions will be made to MSP. MEI's Minority Partner's Interest in subsidiary losses amounts to $47,416 at December 31, 2001. 4 Competitive Conditions Since the principal business of the Partnership is to own and operate real estate, the Partnership is subject to all of the risks incidental to ownership of real estate and interests therein, many of which relate to the illiquidity of this type of investment. The amount of cash received by the Registrant from the real estate is a function of the net rental revenues generated by the properties owned by the Partnership. Net rental revenues from a multifamily apartment complex depend on the rental and occupancy rates of the property and on the level of operating expenses. Occupancy rates and rents are directly affected by the supply of, and demand for, apartments in the market areas in which a property is located. This, in turn, is affected by several factors such as local or national economic conditions, the amount of new apartment construction and interest rates on single-family mortgage loans. These risks include the availability of permanent mortgage funds, which may render the sale, or refinancing of a property difficult or unattractive. In addition, factors such as government regulation (such as zoning and tax laws), inflation, real estate and other taxes, labor problems and natural disasters can affect the economic operations of a property. The illiquidity of real estate investments generally impairs the ability of the Partnership to respond promptly to changes in these circumstances. The Partnership competes with numerous established companies, private investors (including foreign investors), real estate investment trusts, limited partnerships and other entities (many of which have greater resources than the Partnership and broader experience than the General Partner) in connection with the acquisition, sale, financing and leasing of properties. The property owned by the Registrant competes with a substantial number of other apartment complexes. Apartment complexes also compete with single-family housing that is either owned or leased by potential tenants. The principal method of competition is to offer competitive rental rates. Such properties also compete by emphasizing property location, condition and amenities. The Registrant believes that its property is in compliance in all material respects with federal, state and local regulations regarding hazardous waste and other environmental matters and the Registrant is not aware of any environmental contamination at any of such properties that would require any material capital expenditure by the Registrant for the remediation thereof. The Registrant has no employees. Certain services are provided to the Registrant by certain affiliates (See Item 13.): Subordinated Real Estate commissions Under the Partnership Agreement, the General Partners or an affiliate is entitled to a subordinated real estate commission upon the sale of partnership properties. Payment of the commission is subordinated to distributions to the Limited Partners of original invested capital plus a 9% per annum cumulative return. Subordinated real estate commissions payable totaled $548,757 at both December 31, 2001 and 2000. Compensation and Cost Reimbursement Compensation and reimbursements paid to or accrued for the benefit of OSGPC and affiliates for the years ending December 31 are as follows:
2001 2000 1999 -------- -------- -------- Asset management fee $ 90,000 $112,500 $112,500 Charged to general and administrative expense: Partnership and Financial administration, accounting and tax reporting, and investor relations 22,565 27,178 25,000 -------- -------- -------- Total compensation and reimbursements $112,565 $139,678 $137,500 ======== ======== ========
5 ITEM 2. PROPERTY Description of Real Estate The following table sets forth the investment portfolio of the Partnership at December 31, 2001. The value of the property reflects its new basis after an impairment charge of $2,100,000 recorded to the balance sheet effective December 31, 2001. It is the opinion of management that the property has adequate insurance coverage. A discussion of general competitive conditions to which the property is subject is included in Item 1 hereof. The mortgage note payable at December 31, 2001 secured by Superstition Park Apartments is $15,758,530. Full detail of the mortgage is described in Item 8 - "Note 5 - Notes Payable."
Gross Book Value Occupancy Date Property Description of Property Rate Acquired -------- ----------- ----------- --------- -------- Superstition Park Apartments Apartments Tempe, Arizona 376 units $ 17,021,260 84% July 1999 ==============
Depreciation is taken on the straight-line basis over the estimated useful life of the property (25 years). Operating Data Occupancy Information for Superstition Park for the years 1999 to date:
July 1, 1999* through December 31, 1999 2000 2001 2002** ----------------- ---- ---- ------ Occupancy rate 93% 89% 84% 87% Average effective rental rate per unit $790 $740 $749 $726
* Date of acquisition. ** Through February 25, 2002. ITEM 3. LEGAL PROCEEDINGS A tenant of the Glasshouse Square shopping center (sold in 1998) filed an action against the Partnership and the current owner of the Glasshouse Square shopping center in the San Diego Superior Court. This case involves the failure of a sewer line that served the tenant's premises. The tenant alleged that the defendants are liable for the cost of approximately $90,000 to repair the sewer line and $26,000 of profits lost due to this sewer line's failure. The tenant also seeks to recover its attorney's fees and costs in the action under the terms of the lease. The amounts of fees and costs incurred by the tenant are unknown. The tenant rejected initial attempts to discuss a settlement. The Partnership answered the tenant's complaint by filing a cross-complaint for indemnity against the current owner of the property. The Partnership prevailed against the tenant on a motion for summary judgment in December of 2001. The tenant appealed that ruling; however, the court upheld its prior ruling and the Partnership again prevailed on its motion. The tenant is thought to be in the process of filing an appeal with the California Court of Appeals although no notice has been received by the Partnership. It is not possible to predict the outcome of the motion or the claims against the current owner of the Glasshouse Square shopping center. No accrual has been made in the financial statements in respect of this matter. There are no other material pending legal proceedings to which the Registrant is a party or to which its property is subject. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None. 6 PART II ITEM 5. MARKET FOR REGISTRANT'S UNITS OF LIMITED PARTNERSHIP AND RELATED SECURITY HOLDER MATTERS (A) There is no established public trading market for Limited Partnership Units, nor is one expected to develop. (B) The approximate number of unit holders at March 27, 2002:
Title of Class Number of Record Unit Holders -------------- ----------------------------- Income units 571 Growth/shelter units 791 ------ 1,362 ======
(C) The Partnership did not make distributions during the years ended December 31, 1999 and 2001. However distributions of $18,715 paid during 2000 were for state income taxes withheld and remitted to the State of California on prior year distributions. Cumulative distributions through December 31, 2001, were $16,905,944, $1,786,307, and $590,957 to the Income, Growth/Shelter, and General Partners, respectively. See Item 7. Management Discussion and Analysis of Financial Condition and Results of Operations, for information regarding the sources of funds used for cash distributions and for a discussion of factors, if any, which may adversely affect the Registrant's ability to make future cash distributions. 7 ITEM 6. SELECTED FINANCIAL DATA The following table sets forth a summary of certain financial data for the Partnership. This summary should be read in conjunction with the Partnership's consolidated financial statements and notes thereto appearing in Item 8.
Year Ended December 31, Consolidated Statements ---------------------------------------------------------------------------- Of Operations 2001 2000 1999 1998 1997 ----------------------- ------------ ------------ ------------ ------------ ------------ Rental income $ 2,485,086 $ 2,830,971 $ 1,651,793 $ 1,551,668 $ 2,390,773 Interest income 1,657 6,510 34,592 45,915 32,335 Other income 347,185 261,662 135,306 160,427 84,723 Expenses (4,288,618) (4,164,290) (3,266,482) (2,069,394) (2,886,252) Impairment charge (2,100,000) -- -- -- -- Minority partner's interest 47,416 -- -- -- -- Gain on sale of real estate -- -- 2,212,935 198,610 -- ------------ ------------ ------------ ------------ ------------ Income (loss) before extraordinary items (3,507,274) (1,065,147) 768,144 (112,774) (378,421) Extraordinary items* -- -- -- 420,418 -- ------------ ------------ ------------ ------------ ------------ Net income (loss)** $ (3,507,274) $ (1,065,147) $ 768,144 $ 307,644 $ (378,421) ============ ============ ============ ============ ============ Net income (loss) per Limited Partnership unit: Income (loss) before extraordinary items $ (101.37) $ (30.79) $ 22.20 $ (3.26) $ (10.92) Extraordinary items -- -- -- 12.15 -- ------------ ------------ ------------ ------------ ------------ Net income (loss) $ (101.37) $ (30.79) $ 22.20 $ 8.89 $ (10.92) ============ ============ ============ ============ ============ Distributions per Limited Partnership unit: Income Partners $ -- $ 1.06 $ -- $ 60.64 $ -- Growth/Shelter Partners $ -- $ -- $ -- $ -- $ --
As of December 31, Consolidated Balance --------------------------------------------------------------------------- Sheets 2001 2000 1999 1998 1997 -------------------- ------------ ------------ ------------ ------------ ------------ Real estate, net $ 17,021,260 $ 19,356,674 $ 19,889,398 $ 1,712,837 $ 10,951,261 Notes receivable, net -- -- -- -- 250,000 Total assets 17,272,701 20,406,404 21,397,653 2,135,979 12,248,950 Mortgage and promissory notes payable 19,808,530 19,939,787 19,875,000 1,677,715 10,680,255 Partners' equity (deficit) (4,082,501) (575,227) 508,635 (259,509) 507,540
Net income (loss) per Limited Partnership Unit is computed by dividing net loss allocated to the Limited Partners by the weighted average number of Limited Partnership Units outstanding during the year. Per unit information has been computed based on 34,253 Limited Partnership Units outstanding in 2001, 2000 and 1999, 34,275 Limited Partnership Units outstanding in 1998, 34,301 Units outstanding in 1997. * Related to debt forgiveness. ** See Management's Discussion and Analysis of Financial Condition and Results of Operations. 8 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Forward-Looking Information This report contains forward-looking statements that reflect management's current beliefs and estimates of future economic circumstances, industry conditions, the Partnership's performance and financial results. All statements, trend analysis and other information concerning possible or assumed future results of operations of the Partnership and the real estate investments it has made (including, but not limited to, the information contained in "Management's Discussion and Analysis of Financial Condition and Results of Operations"), constitute forward-looking statements. Unit holders and others should understand that these forward looking statements are subject to numerous risks and uncertainties and a number of factors could affect the future results of the Partnership and could cause those results to differ materially from those expressed in the forward-looking statements contained herein. These factors include local and national economic conditions, the amount of new construction, interest rates on single-family home mortgages, government regulation, price inflation, the level of real estate and other taxes imposed on the properties, labor problems and natural disasters. Outlook The complex was constructed in 1985, acquired by the Partnership in July 1999 and is currently held for sale. Management believes that no significant rehabilitation or deferred maintenance costs are required. Consequently, the Partnership has not entered into any commitments in respect of any significant non-recurring capital expenditures. However, management has recorded and impairment charge of $2,100,000 against the carrying value of the property. Management's cash flow estimates for the year ended December 31, 2002 indicate that operations at the property will improve from the 87% occupancy levels in February 2002 to 90% for the year. This would generate total revenue for the year ended December 31, 2002 of approximately $2,800,000. Net operating income of approximately $1,700,000 is estimated based on projected operating expenses for the year. After mortgage note interest, recurring capital expenditures, and depreciation and amortization, the property is expected to generate a net loss of approximately $400,000 for the year ended December 31, 2002. Liquidity And Capital Resources General: The Partnership's principal capital resources at December 31, 2001 consisted of one apartment complex located in Tempe, Arizona with a carrying value of $17,021,260 as of that date. The number of units available was 376 with an 84% occupancy rate. The apartment complex was acquired by the Partnership through a like-kind exchange in 1999. The acquisition was financed through proceeds of approximately $18,600,000 received from the issuance of two mortgage notes. These notes were subsequently refinanced through the issuance of a $16,000,000 mortgage note and the issuance of general promissory notes of $4,050,000. See Item 7a - Quantitative and Qualitative Disclosures About Market Risk. These general promissory notes include a feature, which will allow the holders to potentially share in appreciation of the property, upon certain circumstances being met. There can be no assurances that the property will appreciate in value. The Partnership does not anticipate acquiring additional properties. Operations did not generate sufficient cash in 2001 to meet all of the Partnership's cash flow needs. In 2001, affiliates of the General Partners advanced $229,125 to the Partnership to enable it to meet its cash requirements. See Note 2 to the Consolidated Financial Statements. There is no assurance that the General Partners will fund the cash short falls of the Partnership in the future. The property is currently being marketed for sale. The net proceeds, if any, from the sale will be distributed to income unit holders after all superior obligations have been paid. It is the General Partners' intent to dissolve the Partnership once distributions have been made. There is no assurance that sufficient, if any, proceeds will be available to satisfy all outstanding obligations of the property (including the subordinated real estate commissions), the Partnership or return the equity to the partners. 9 The following sets forth certain information regarding the real estate owned by the Partnership: Superstition Park Apartments The apartment complex, which is located in Tempe, Arizona, had an average occupancy rate of 86% in 2001, 89% in 2000 and 93% in 1999. This property generated a net operating loss of $1,031,010 in 2001 and net operating income of approximately $1,441,450 and $654,453 for 2000 and 1999, respectively. Debt service payments for this property were approximately:
2001 2000 ---------- ---------- Principal Mortgage note 131,000 110,000 Participation notes -- -- Interest Mortgage notes 1,246,000 1,259,000 Participation notes 405,000 405,000
The mortgage note had a principal balance of approximately $15,759,000 at December 31, 2001. The last principal payment on the underlying mortgage is due January 2010. The outstanding balance of the participation notes were $4,050,000 at December 31, 2001. These notes contain a participation feature whereas the holder of the notes could possibly share in the appreciation of the real estate investment at the time that the property is sold. The property will have to be sold for more than $20,250,000 before the holders of these notes will share in the any appreciation. At December 31, 2001 the Company has not recorded a participation liability for this participation feature as management has estimated that the appreciation of the real investment over the term of these notes will be minimal, if any (see asset quality below). The actual appreciation in the real estate investment could differ from management's estimated resulting in a future liability. These note agreements further preclude the Partnership from making distributions in excess of capital contributions, unless all the principal and interest then due on these notes are paid in full, except for state tax obligations of foreign partners. The participation note agreements call for additional capital contributions to be made by the general partner in years 2002 through 2005 in the event that the Partnership is in default of the interest payments. However the failure to make current interest payments will not cause an event of default unless the Partnership has received sufficient funds from the property. These additional contributions are to be used to make payment on the accrued but unpaid interest. During the first quarter of 2002, the Partnership did not acquire additional properties. The Partnership requires cash to pay its operating and debt service expenses and for periodic distributions to its unit holders. The following table sets forth information regarding cash distributions paid to unit holders during the years shown:
For the Year Ended For the Year Ended For the Year Ended December 31, 2001 December 31, 2000 December 31, 1999 ------------------ ------------------ ------------------ Income units $ -- $ 18,715 $ -- Growth/Shelter units -- -- -- ------------------ ------------------ ------------------ $ -- $ 18,715 $ -- ================== ================== ==================
The principal sources of cash available for the payment of expenses and distributions are: (i) net rental and other revenues generated by the Partnership's real estate, (ii) interest income earned on temporary investments, (iii) undistributed cash held by the Partnership and (iv) advances from the general partner to pay interest on the senior participation notes. Future distributions to unit holders will depend on the amount of net rental and other income and interest income earned by the Partnership and the amount of undistributed cash it holds. The Partnership believes that the cash provided by net rental and other income and interest income, supplemented, if necessary, by cash-on-hand and General Partner advances will be adequate to meet its projected short-term liquidity requirements. Under the terms of its Partnership Agreement, the Partnership has the authority to enter into short-term and long-term debt financing arrangements. The Partnership currently has entered into such arrangements for purposes of 10 debt service payments on the senior participation notes with a related party to the General Partners, but not for making distributions and repurchasing units. The Partnership is not authorized to issue additional units to meet short-term or long-term liquidity requirements. A summary of contractual cash obligations at December 31, 2001 is as follows:
PAYMENTS DUE BY PERIOD --------------------------------------------------------------------------------------- CONTRACTUAL OBLIGATIONS TOTAL 2002 2003 2004 2005 2006 ----------------------- ------------ ------------ ------------ ------------ ------------ ------------ Secured Notes Payable including interest $ 6,887,510 $ 1,377,502 $ 1,377,502 $ 1,377,502 $ 1,377,502 $ 1,377,502 Unsecured notes including interest 5,065,000 405,000 405,000 4,255,000 -- -- Total contractual cash obligations $ 11,952,510 $ 1,782,502 $ 1,782,502 $ 5,632,502 $ 1,377,502 $ 1,377,502
Asset Quality: It is the policy of the Partnership to make a periodic review of its real estate, and adjust, when necessary, the carrying value of such real estate. Real estate property held by the Partnership is recorded at the lower of cost or fair value. The fair value of real estate owned by the Partnership is based on management's best estimate of the fair value of the properties, which may vary from the ultimate value realized from these properties. Management reviews the property for impairment whenever events or changes in circumstances indicate that the carrying value of the property may not be recoverable. The review of recoverability is based on an estimate of undiscounted future cash flows expected to result from its use and eventual disposition. If impairment exists due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value of the property exceeds its estimated value. As indicated in the Outlook section, Management has recorded an impairment charge in the amount of $2,100,000 thereby reducing the carrying value of the property to $17,021,260 at December 31, 2001. The impairment is considered necessary based on the current and estimated future levels of occupancy of the property, potential rehabilitation costs and local real estate market conditions. Comparative Analysis: Cash used in operating activities was $194,269, $25,400 and $521,340 for the twelve months ended December 31, 2001, 2000 and 1999, respectively. For 2001, net loss included non-cash charges of depreciation and amortization of $872,879 and an impairment charge against the carrying value of the property of $2,100,000. Additionally, cash was provided by a decrease in escrow reserves of $81,627, an increase in accounts payable and accrued expenses of $264,071 and an increase in prepaid rent of $55,794. These sources of cash from operations were partially offset by an increase in prepaid expenses and other assets of $18,940, a decrease in security deposits of $5,138, and an increase in accounts receivable of $3,026. For 2000, net loss included non-cash charges of depreciation and amortization of $842,344. Additionally, cash was provided by a decrease in escrow reserves of $121,649, a decrease in prepaid expenses and other assets of $52,236 and an increase in accrued mortgage interest of $151,085. These sources of cash from operations were partially offset by a decrease in accounts payable and accrued expenses of $93,855, a decrease in other payables of $20,422, and a decrease in property taxes of $12,960. For 1999, net income included non-cash charges of depreciation and amortization of $574,277, and non-cash expenses on the acquisition of Superstition Park Apartments of $113,312. In addition, net income included a gain on sale of real estate of $2,212,935. Additionally, cash was provided by a decrease in prepaid expenses and other assets of $42,735, an increase in accounts payable and accrued expenses of $130,156 and an increase in accrued mortgage interest of $317,860. The sources of cash from operations were partially offset by an increase in escrow reserves of $226,387. 11 For 2001, the cash used in investing activities was $122,297 which was used primarily to purchase equipment and building improvements. For 2000, the cash used in investing activities was $206,103 which was used primarily to purchase equipment and building improvements. For 1999, the Partnership received proceeds from the sale of Washington Towne Apartments of $1,914,994 and used cash of $1,900,147 in the acquisition of Superstition Park Apartments, resulting in net cash provided by investing activities of $14,847. Additionally, in 2001 cash flows from financing activities consisted primarily of an advance in the amount of $229,125 from affiliates, offset by principal payments made on mortgage notes payable of $131,257. For 2000, cash flows from financing activities consisted primarily of proceeds received from participating notes payable of $175,000 and a refund on the mortgage note refinancing of $160,000 off-set by principal payments made on the mortgage notes of $110,213. For 1999, the Partnership received cash advances from mortgage notes and participating notes of $19,875,000, and made payments on mortgage notes of $18,636,558. In addition the Partnership used cash of $607,287 for borrowing costs. Should operations deteriorate and present resources not be adequate for current needs, the Partnership has no outside lines of credit on which to draw for its working capital needs. Neither the General Partners, its affiliates nor Median Realty Advisors, Inc. have any obligation to provide financial support to the Partnership, although they have been providing some financial support during 2001 and since December 31, 2001. Accordingly, continued operations of the Partnership is dependent on the Partnership being able to generate cash flow from operations or sale of its remaining operating property or negotiated reductions in requirements related to outstanding debt obligations. If the Partnership is unable to either generate sufficient operating cash flows or ultimately renegotiate its debt structure, the Partnership would have to restructure its agreement with the note holders. Results Of Operations The table below compares the results of operations for each year shown:
For the Year Ended For the Year Ended For the Year Ended December 31, 2001 December 31, 2000 December 31, 1999 ------------------ ------------------ ------------------ Revenues: Rental income $ 2,485,086 $ 2,830,971 $ 1,651,793 Other income 347,185 261,662 135,306 Interest income 1,657 6,510 34,592 ------------------ ------------------ ------------------ 2,833,928 3,099,143 1,821,691 ------------------ ------------------ ------------------ Expenses: Property taxes 169,350 152,384 127,755 Other property operations 1,196,169 994,021 593,663 Impairment charge 2,100,000 -- -- Bad debts 24,498 46,571 17,400 General and administrative 232,449 299,552 353,381 Property management fees 142,472 165,165 75,069 ------------------ ------------------ ------------------ 3,864,938 1,657,693 1,167,268 ------------------ ------------------ ------------------ Net operating income (loss) (1,031,010) 1,441,450 654,423 Depreciation and amortization (872,879) (842,344) (574,277) Interest expense (1,650,801) (1,664,253) (1,524,937) Gain on sale of real estate -- -- 2,212,935 Minority partner's interest 47,416 -- -- ------------------ ------------------ ------------------ Net income (loss) $ (3,507,274) $ (1,065,147) $ 768,144 ================== ================== ==================
12 The table below compares the movement in the results of operations for each year shown:
Movement Movement From 2000 From 1999 ------------ ------------ Revenues: Rental income $ (345,885) $ 1,179,178 Other income 85,523 126,356 Interest income (4,853) (28,082) ------------ ------------ (265,215) 1,277,452 ------------ ------------ Expenses: Property tax expense 16,966 24,629 Other property operations 202,148 400,358 Impairment charge 2,100,000 -- Bad debts (22,073) 29,171 General and administrative (67,103) (53,829) Property management fees (22,693) 90,096 ------------ ------------ 2,207,245 490,425 ------------ ------------ Net operating income (2,472,460) 787,027 Depreciation and amortization (30,535) (268,067) Interest expense 13,452 (139,316) Gain on sale of real estate -- (2,212,935) Minority partner's interest 47,416 -- ------------ ------------ Net income (loss) $ (2,442,127) $ (1,833,291) ============ ============
Revenues: Rental revenues were $2,485,086, $2,830,971, and $1,651,793 for the years ended December 31, 2001, 2000, and 1999, respectively. An increase in vacancy loss attributed to the decrease of revenue for 2001. Prior to April of 1999 the Partnership held an ownership interest in Washington Towne Apartments (a 148-unit apartment complex). The sale of the Washington Towne Apartments in April of 1999, and the subsequent purchase of the larger Superstition Park Apartments (a 376-unit apartment complex) in July of 1999 resulted in an increase in rental revenues from 1999 to 2000 of $1,179,178. Interest income decreased $4,853 and $28,082 from 2000 to 2001 and 1999 to 2000, respectively. Interest income for the year ended December 31, 1999 was largely attributable to the proceeds received from the sale of the Washington Towne Apartments which were held in an interest bearing escrow account until the Superstition Park Apartments were acquired, in addition to the interest earned on funds held in escrow pending the completion of the participating notes payable offering. The Partnership did not earn similar type interest during the years ended December 31, 2000 and 2001. Other income increased $85,523 from 2000 to 2001 and $126,356 from 1999 to 2000. The increase in other income is attributable to increases in cable television revenue and water reimbursements. Expenses: Interest expense was $1,650,801, $1,664,253 and $1,524,937 for the years ended December 31, 2001, 2000 and 1999, respectively. Interest expense for the year ended December 31, 2001 was largely unchanged from the previous year. Interest expense for the years ended December 31, 2000 and 2001 includes a full year of interest on the mortgage note payable collateralized by the Superstition Park Apartments, and the general participating notes payable. Interest expense for the year ended December 31, 1999 includes a partial year of interest on mortgage notes payable collateralized by the Superstition Park Apartments, but does not include any interest on the participating notes 13 payable that were effective December 31, 1999. Interest expense for the year ended December 31, 1999 does include interest charges of $325,000 incurred upon refinancing the original note payable entered into upon acquiring the Superstition Park Apartments. The Partnership sold the Washington Towne Apartments in 1999 resulting in a gain of $2,212,935. There were no sales during the years ended December 31, 2001 or 2000. Depreciation and amortization expense was $872,879, $842,344, and $574,277 for the years ended December 31, 2001, 2000 and 1999, respectively. The increase in depreciation and amortization expense from 2000 to 2001 is attributed to depreciation expense on equipment and building improvements for assets added in 2000 and 2001. The increase in depreciation and amortization expense from 1999 to 2000 is attributable to the Superstition Park Apartments being held by the Partnership for the entire year, versus for only six months in 1999. In addition the Partnership began amortizing debt issuance cost associated with notes payable during 2000, when there was no such amortization in 1999. It is the General Partners' intent to sell the property. Management began actively marketing the property for sale in October 2001 and subsequently, effective December 31, 2001, recorded an impairment charge of $2,100,000 against the property based on various letters of intent to purchase the property and the estimated future cashflows to be generated by the property. Property tax expense was $169,350, $152,384 and $127,755 for the years ended December 31, 2001, 2000 and 1999, respectively. The increase in property tax expense from 2000 to 2001 is consistent with tax increases within the jurisdiction of these properties. The increase in property tax expense from 1999 to 2000 is a result of holding the Superstition Park Apartments for the entire year in 2000, versus for only six months in 1999, and the disposal of the Washington Towne Apartments in 1999. Other property operations expenses were $1,196,169, $994,021 and $593,663 for the years ended December 31, 2001, 2000 and 1999, respectively. The increase in other property operations expense from 2000 to 2001 was consistent with increases in salaries, marketing and maintenance costs. The increase in other property operations expense from 1999 to 2000 is a result of the Superstition Park Apartments being operational for the entire 2000 year, when it was only operational for six months in 1999. In addition, there were approximately three months in 1999 where the Partnership held no real estate and thus incurred no other property operations expenses, which resulted in a decrease of these expenses from 1998 to 1999. In addition, the Superstition Park Apartments is a 376 unit complex, and the Washington Towne Apartments was a 148 unit complex, resulting in higher other property operations expenses being incurred by the Partnership. General and administrative expenses, both non-affiliates and affiliates, were $232,449, $299,552, and $353,381 for the years ended December 31, 2001, 2000 and 1999, respectively. The increase in general and administrative expenses in 1999 as compared to 2000 and 2001 is largely attributable to professional fees incurred with the disposal of the Washington Towne Apartments, and the acquisition of the Superstition Park Apartments. Property management fees were $142,472, $165,165, and $75,069 for the years ended December 31, 2001, 2000 and 1999, respectively. The change in the property management fee is a direct result of the increase or decrease in collected revenue from the previous year. As mentioned earlier, the Partnership sold the 148-unit Washington Towne Apartments complex in April of 1999 and acquired the 376-unit Superstition Park Apartments complex in July of 1999. Revenue from rental operations, and therefore property management fees, increased significantly as a result. New Accounting Pronouncements In July 2001 SFAS 141, Business Combinations, and SFAS 142 Goodwill and Other Intangible Assets, were issued. These pronouncements provide that all business combinations initiated after June 30, 2001 be accounted for using the purchase method and that goodwill be reviewed for impairment rather than amortized, beginning on January 1, 2002. The Company does not believe that the adoption of these pronouncements will have a material effect on its financial statements. Any business combination transactions in the future would be accounted for under this new guidance. 14 In September 2001, the FASB issued SFAS 143, Asset Retirement Obligations. This Statement addressed financial accounting and reporting for obligation associated with the retirement of tangible long-lived assets and the associated asset retirement costs. The Statement will be effective for the Company's fiscal year ending December 2003. The Company does not believe that the adoption of this pronouncement will have a material effect on its financial statements. In August 2001, the FASB issued SFAS 144, Accounting for Impairment or Disposal of Long-Lived Assets. This Statement addresses financial accounting and reporting for the impairment or disposal of long-lived assets. The Statement will be effective for the Company's fiscal year ending December 2002. The Partnership has, pursuant to this FASB, recorded a $2,100,000 impairment charge against the property. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Partnership's primary market risk exposure is interest rate risk. The Partnership's exposure to market risk for changes in interest rates relates primarily to its long-term borrowings used to fund expansion of the Partnership's real estate portfolio. The Partnership's interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and to lower its overall borrowing costs. To achieve its objectives, the Partnership borrows primarily at fixed rates. The Partnership does not enter into derivative instrument transactions for speculative purposes. At December 31, 2001, the Partnership's long-term borrowings secured by real estate consisted of fixed-rate financing, in addition to its other long-term borrowings, which also consisted of fixed rate financing. The Partnership had no short-term financing at December 31, 2001 other than related party advances. The table below presents principal amounts and weighted average interest rates by year of maturity for the Partnership's borrowings:
2002 2003 2004 2005 2006 Thereafter Total Fixed rate borrowings secured $ 141,972 $ 153,562 $ 162,564 $ 179,368 $ 196,010 $ 14,927,054 $ 15,758,530 by real estate 7.765% 7.765% 7.765% 7.765% 7.765% 7.765% 7.765% Fixed rate borrowings $ -- $ -- $ 4,050,000 $ -- $ -- $ -- $ 4,050,000 - other 10% 10% 10% -- -- 10%- 10%
It is estimated that the above interest rates approximate market rates and that the carrying value of the long-term borrowings approximates their fair value. 15 ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Page Number ------ INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Consolidated Financial Statements: Independent Auditor's Report, December 31, 2001, 2000, and 1999............................. F1 Consolidated Balance Sheets as of December 31, 2001 and 2000................................ F2 Consolidated Statements of Operations for the Years Ended December 31, 2001, 2000 and 1999.......................................................... F3 Consolidated Statement of Partners' Equity (Deficit) for the Years Ended December 31, 2001, 2000 and 1999.......................................................... F4 Consolidated Statements of Cash Flows for the Years Ended December 31, 2001, 2000 and 1999.......................................................... F5 Notes to Consolidated Financial Statements.................................................. F7 Consolidated Supplementary Data: Schedule of Real Estate Investments and Accumulated Depreciation and Amortization.............................................................................. F16 Schedule of Mortgage Loans on Real Estate................................................... F18
16 INDEPENDENT AUDITOR'S REPORT To the Partners University Real Estate Partnership V Dallas, Texas We have audited the accompanying consolidated balance sheets of University Real Estate Partnership V and subsidiaries (the "Partnership") as of December 31, 2001 and 2000, and the related consolidated statements of operations, partners' equity (deficit) and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. The consolidated financial statements of the Partnership for the year ended December 31, 1999 was audited by Wallace Sanders & Company, whose partners merged with McGladrey & Pullen, LLP on September 6, 2000 and whose report dated April 10, 2000, expressed an unqualified opinion on those statements. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of University Real Estate Partnership V as of December 31, 2001 and 2000, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. In connection with our audits of the consolidated financial statements referred to above, we have audited the accompanying financial schedules listed under item 14(a)(2) as of and for the years ended December 31, 2001 and 2000. In our opinion, these financial schedules, when considered in relation to the consolidated financial statements taken as a whole, present fairly, in all material respects, the information stated therein. The accompanying consolidated financial statements have been prepared assuming the Partnership will continue as a going concern. As described in Note 2 of the consolidated financial statements, the Partnership does not generate sufficient cash for its working capital and debt service needs. As a result, there is substantial doubt regarding the Partnership's ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Dallas, Texas April 15, 2002 F1 UNIVERSITY REAL ESTATE PARTNERSHIP V CONSOLIDATED BALANCE SHEETS
December 31, ---------------------------- ASSETS 2001 2000 ------ ------------ ------------ Property held for sale (Notes 4 and 5) Land $ 2,045,356 $ 2,045,356 Buildings and improvements 14,975,904 18,414,312 ------------ ------------ 17,021,260 20,459,668 Less: Accumulated depreciation and amortization -- (1,102,994) ------------ ------------ 17,021,260 19,356,674 ------------ ------------ Cash (including $46,484 and $51,622 for security deposits at December 31, 2001 and 2000, respectively) 62,106 280,804 Accounts receivable 8,454 5,428 Other receivables - related parties 28,311 33,073 Deferred borrowing costs, net (Note 6) -- 515,168 Escrows 133,630 215,257 Prepaid expenses and other assets 18,940 -- ------------ ------------ $ 17,272,701 $ 20,406,404 ============ ============ LIABILITIES AND PARTNERS' DEFICIT Mortgage note payable (Note 5) $ 15,758,530 $ 15,889,787 Participating notes payable (Note 5) 4,050,000 4,050,000 Advances - related party (Note 2) 229,125 -- Accrued mortgage interest 206,620 206,872 Accrued property taxes 84,836 76,192 Accounts payable and other accrued expenses 310,944 107,176 Other payable - related parties 99,481 39,178 Prepaid rent 67,841 12,047 Security deposits 46,484 51,622 Subordinated real estate commissions (Note 3) 548,757 548,757 ------------ ------------ 21,402,618 20,981,631 ------------ ------------ Commitments and contingencies (Note 10) -- -- Minority partner's interest (47,416) -- Partners' deficit: Limited Partners - 50,000 units authorized; 34,253 units issued and outstanding (17,723 Income units and 16,530 Growth/Shelter units) (3,501,306) (29,105) General Partner (581,195) (546,122) ------------ ------------ (4,082,501) (575,227) ------------ ------------ $ 17,272,701 $ 20,406,404 ============ ============
See accompanying notes to consolidated financial statements. F2 UNIVERSITY REAL ESTATE PARTNERSHIP V CONSOLIDATED STATEMENTS OF OPERATIONS
For the Years Ended December 31, -------------------------------------------- 2001 2000 1999 ------------ ------------ ------------ Revenues: Rental income $ 2,485,086 $ 2,830,971 $ 1,651,793 Other income 347,185 261,662 135,306 Interest 1,657 6,510 34,592 ------------ ------------ ------------ Total revenues 2,833,928 3,099,143 1,821,691 ------------ ------------ ------------ Expenses: Property taxes 169,350 152,384 127,755 Other property operations 1,196,169 994,021 593,663 Impairment charge (Note 4) 2,100,000 -- -- Bad debts 24,498 46,571 17,400 Property management fees 142,472 165,165 75,069 General and administrative 119,884 159,874 215,881 General and administrative - affiliates (Note 3) 112,565 139,678 137,500 ------------ ------------ ------------ Total expenses 3,864,938 1,657,693 1,167,268 ------------ ------------ ------------ Net operating income (loss) (1,031,010) 1,441,450 654,423 Interest (1,650,801) (1,664,253) (1,524,937) Depreciation and amortization (872,879) (842,344) (574,277) ------------ ------------ ------------ Net loss, prior to gain on sale of real estate (3,554,690) (1,065,147) (1,444,791) ------------ ------------ ------------ Gain on sale of real estate (Note 8) -- -- 2,212,935 ------------ ------------ ------------ Net (loss) income before minority partner's interest in loss (3,554,690) (1,065,147) 768,144 Minority partner's interest in loss 47,416 -- -- ------------ ------------ ------------ Net income (loss) $ (3,507,274) $ (1,065,147) $ 768,144 ============ ============ ============ Net income (loss) allocable to General Partner (35,073) (10,651) 7,681 Net income (loss) allocable to Limited Partners (3,472,201) (1,054,496) 760,463 ------------ ------------ ------------ Net income (loss) $ (3,507,274) $ (1,065,147) $ 768,144 ============ ============ ============ Net income (loss) per Limited Partnership Unit $ (101.37) $ (30.79) $ 22.20 ============ ============ ============
See accompanying notes to consolidated financial statements. F3 UNIVERSITY REAL ESTATE PARTNERSHIP V CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
Total Partners' General Limited Equity Partner Partners (Deficit) ------------ ------------ ------------ Balance at December 31, 1998 $ (543,152) $ 283,643 $ (259,509) Net income 7,681 760,463 768,144 ------------ ------------ ------------ Balance at December 31, 1999 (535,471) 1,044,106 508,635 Net loss (10,651) (1,054,496) (1,065,147) Distributions -- (18,715) (18,715) ------------ ------------ ------------ Balance at December 31, 2000 (546,122) (29,105) (575,227) Net loss (35,073) (3,472,201) (3,507,274) ------------ ------------ ------------ Balance at December 31, 2001 $ (581,195) $ (3,501,306) $ (4,082,501) ============ ============ ============
See accompanying notes to consolidated financial statements. F4 UNIVERSITY REAL ESTATE PARTNERSHIP V CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, -------------------------------------------- 2001 2000 1999 ------------ ------------ ------------ Cash flows from operating activities: Cash received from tenants $ 2,960,328 $ 3,093,772 $ 1,735,727 Cash paid to suppliers (1,343,709) (1,447,170) (966,772) Interest received 1,657 6,510 34,592 Interest paid (1,651,678) (1,513,168) (1,207,077) Property taxes paid (160,867) (165,344) (117,810) ------------ ------------ ------------ Net cash used in operating activities (194,269) (25,400) (521,340) ------------ ------------ ------------ Cash flows from investing activities: Investment in real estate (122,297) (206,103) (1,900,147) Proceeds on sale of real estate -- -- 1,914,994 ------------ ------------ ------------ Net cash provided by (used in) investing activities (122,297) (206,103) 14,847 ------------ ------------ ------------ Cash flows from financing activities: Principal payments on mortgage notes payable (131,257) (110,213) (18,636,558) Advances on mortgage notes and participating notes payable -- 175,000 19,875,000 Refund on mortgage refinancing -- 160,000 -- Advances - related party 229,125 -- -- Deferred borrowing costs -- (11,395) (607,287) Distributions -- (18,715) -- ------------ ------------ ------------ Net cash provided by financing activities 97,868 194,677 631,155 ------------ ------------ ------------ NET INCREASE (DECREASE) IN CASH (218,698) (36,826) 124,662 CASH AT BEGINNING OF YEAR 280,804 317,630 192,968 ------------ ------------ ------------ CASH AT END OF YEAR $ 62,106 $ 280,804 $ 317,630 ============ ============ ============
See accompanying notes to consolidated financial statements. F5 UNIVERSITY REAL ESTATE PARTNERSHIP V CONSOLIDATED STATEMENTS OF CASH FLOWS Reconciliation of Net Income (Loss) to Net Cash Used in Operating Activities
For the Years Ended December 31, -------------------------------------------- 2001 2000 1999 ------------ ------------ ------------ Net income (loss) $ (3,507,274) (1,065,147) $ 768,144 ------------ ------------ ------------ Adjustments to reconcile net income (loss) to net cash used in operating activities: Depreciation and amortization 872,879 842,344 574,277 Minority partner's interest (47,416) -- -- Gain on sale of real estate -- -- (2,212,935) Impairment charge 2,100,000 -- -- Non-cash income on sale of Washington Towne -- -- (4,475) Non-cash expenses on acquisition of Superstition Park -- -- 113,312 (Increase) decrease in operating assets: Accounts receivable (3,026) (4,305) (17,536) Prepaid expenses and other assets (18,940) 52,236 42,735 Other receivables - related parties 4,762 -- -- Escrows 81,627 121,649 (226,387) Increase (decrease) in operating liabilities: Accounts payable and accrued expenses 203,768 (93,855) 130,156 Other payables - related parties 60,303 (20,422) -- Prepaid rent 55,794 2,380 9,289 Accrued mortgage interest (252) 151,085 317,860 Accrued property taxes 8,644 (12,960) 9,945 Security deposits (5,138) 1,595 (25,725) ------------ ------------ ------------ Total adjustments 3,313,005 1,039,747 (1,289,484) ------------ ------------ ------------ Net cash used in operating activities $ (194,269) $ (25,400) $ (521,340) ============ ============ ============
See accompanying notes to consolidated financial statements. F6 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization University Real Estate Partnership V (the "Partnership") was organized in 1977, as a limited partnership under the provisions of the California Uniform Limited Partnership Act as then in effect. The general partners are OS General Partner Company ("OSGPC"), a Texas corporation, and OS Holdings, Inc. ("OS"), a Texas corporation. The Partnership was formed to acquire, operate and ultimately dispose of a diversified portfolio of income-producing property. The Partnership shall continue through December 2027 unless terminated sooner. Principles of Consolidation Washington Towne, Inc. ("WT") is the 1% managing member and the Partnership is the 99% member of Washington Towne Apartments, LLC ("WTA"), a Georgia limited liability company. The Partnership is the owner of all the capital stock of WT. Therefore, the Partnership effectively holds a 100% interest in the Washington Towne Apartments. On June 25, 1999, Meridian Superstition Park Investors, LLC ("MSPI"), an Arizona limited liability company, was formed, as a wholly owned limited liability company, by WTA. On July 13, 1999, in order to consummate a refinancing with a new lender, the Partnership entered into an agreement with Meridian Equity Investors, LP ("MEI"), a Texas limited partnership in order to operate Meridian Multi-Family Investors 99-IV ("MMFI 99-IV"), a Texas limited partnership, pursuant to the Limited Partnership Act. The Partnership contributed to MMFI 99-IV its 99% member interest in WTA. The Partnership owns a 99% General Partner interest (both Class A and Class B) in MMFI 99-IV while MEI owns the remaining 1% General Partner interest (both Class A and Class B). MEI is owned by affiliates of the General Partner of the Partnership. On July 20, 1999, the Partnership assigned 99% of the 100 shares of capital stock it owned in WT to MSP Genpar, Inc. ("MSP"), a Texas corporation, in order to satisfy the new lender's structural requirements with respect to the refinancing of Superstition Park Apartments. The Partnership retained 1 share of capital stock in WT. In return for the assignment of 99 shares of stock to MSP, the Partnership receives all of the economic benefit that is normally allocated to MSP. MSP is owned by affiliates of the General Partner of the Partnership. After the stock transfer, WT assigned 0.99% of its 1% member interest in WTA to MMFI 99-IV. Therefore, WT is the 0.01% managing member of WTA and MMFI 99-IV is 99.99% member of WTA. MEI and MSP are effectively minority interest partners, as these entities are not wholly owned by the Partnership. In accordance with various provisions of the Partnership's limited partnership agreement no income (loss) allocations or cash distributions will be made to MSP. MEI's Minority Partner's Interest in subsidiary losses amounts to $47,416 at December 31, 2001. The consolidated financial statements include the accounts of the Partnership, MMFI 99-IV, WT, WTA, and its wholly owned subsidiary, Meridian Superstition Investors, LLC. All significant inter-entity transactions have been eliminated. F7 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Real Estate Investments Real estate investments and improvements are recorded at the lower of cost or fair value. Improvements are capitalized and repairs and maintenance are charged to operations as incurred. Management reviews each property for impairment whenever events or changes in circumstances indicate that the carrying value of a property may not be recoverable. The review of recoverability is based on an estimate of undiscounted future cash flows expected to result from its use and eventual disposition. If impairment exists due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value of the property exceeds its estimated fair value. The Partnership follows Statement of Financial Accounting Standards No. 121, Accounting for Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of (SFAS No. 121) and Statement of Financial Accounting Standards No. 144, Accounting for Impairment or Disposal of Long-Lived Assets (SFAS No. 144) in recording income properties. At December 31, 2001, an impairment charge of $2,100,000 (including the write-down of the remaining, un-amortized, deferred borrowing costs of approximately $400,000) has been recorded in order to reduce cost to fair value less estimated selling costs. Under the accounting standards mentioned above, real estate assets held for sale are to be reviewed for possible impairment whenever events or circumstances indicate the carrying amount of an asset may not be recoverable. If indications are that the carrying amount of an asset may not be recoverable, SFAS No. 121 and SFAS No. 144 require an estimate of future cash flows (undiscounted and without interest charges) expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the assets, an impairment loss must be recognized to write down the assets to its estimated fair value. Preparation of estimated expected future cash flows is inherently subjective and is based on management's best estimate of current conditions and assumptions about expected future conditions, including future costs of development, selling prices and the rate at which residential units are sold. It is reasonably possible that the estimates of future expected cash flows or the fair value of certain of the Partnership's property will be reduced in the near term due to changes in economic conditions or competitive pressures. Depreciation Buildings and improvements are depreciated using the straight-line method over 5 to 25 years. Cash At various times during the year, the Partnership maintained cash balances at financial institutions in excess of federally insured amounts. The Partnership has not experienced any losses in such accounts. Deferred Borrowing Costs Loan fees for long-term financing of real property are capitalized and amortized over the terms of the related mortgage note payable using the effective interest method. Revenue Recognition The Partnership leases its residential property under short-term operating leases. Lease terms generally are less than one year in duration. Rental income is recognized as earned. During the year ended December 31, 1999 the Partnership had leased its commercial property under non-cancelable operating leases that expired over the succeeding 10-year period. Some of these leases provided concessions and periods of escalating or free rent. Rental income was recognized on a straight-line basis over the life of the lease. The excess of the rental income recognized over the contractual rental payments due was recorded as accrued rent receivable. There were no commercial leases held during the years ended December 31, 2001 and 2000. F8 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Income Taxes The Partnership is not a tax paying entity and, accordingly, no provision has been recorded for Federal or state income tax purposes. The partners are individually responsible for reporting their share of the Partnership's taxable income or loss on their income tax returns. In the event of an examination of the Partnership's tax return by the Internal Revenue Service, the tax liability of the partners could be changed if an adjustment in the Partnership's income or loss is ultimately sustained by the taxing authorities. Certain transactions of the Partnership may be subject to accounting methods for income tax purposes that differ from the accounting methods used in preparing these consolidated financial statements in accordance with generally accepted accounting principles. Accordingly, the net income or loss of the Partnership and the resulting balances in the partners' capital (deficit) accounts reported for income tax purposes may differ from the balances reported for those same items in these consolidated financial statements. The tax basis of the Partnership's assets and liabilities was more than the reported amounts by approximately $12,316 at December 31, 2001 and less than the reported amounts by approximately $2,274,000 at December 31, 2000. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Management has estimated that as a result of the impairment charge (see Note 4) recorded against the property held for sale no participation liability needs to be recorded for the participation feature. Actual results could differ from those estimates. Financial Instruments The carrying amounts of financial instruments approximate fair value because of their short maturity or because their related interest rates approximate market rates. Allocation of Net Income and Net Loss The Partnership Agreement provides for net income of the Partnership for both consolidated financial statements and income tax reporting purposes to be allocated 99% to the Limited Partners and 1% to the General Partner. Net income allocated to the Limited Partners shall be allocated first to the Limited Partners holding Growth/Shelter Units in the same ratio and manner that losses were charged to these Limited Partners and up to amounts equal to such previously charged losses and then to all of the Limited Partners in the same ratio that distributions from all sources, other than proceeds from the sale of Limited Partnership units, have been allocated. The Partnership Agreement provides for net losses of the Partnership for both financial statement and income tax reporting purposes to be allocated 1% to the General Partner and 99% to the Growth/Shelter Unit holders. Net Loss Per Limited Partnership Unit Net loss per Limited Partnership Unit is computed by dividing net loss allocated to the Limited Partners by the weighted average number of Limited Partnership Units outstanding during the year. Per unit information has been computed based on 34,253 Limited Partnership Units outstanding in each of 2001, 2000 and 1999. F9 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Distributions Distributions to the Partners are made at the discretion of the General Partner and are subject to payment of expenses of the Partnership, including debt service, and maintenance of reserves. Distributions to the Partners are paid from operations of the Partnership's properties, from sales or refinancing of properties, or from other sources, if any. NOTE 2 - LIQUIDITY The Partnership's principal capital resources at December 31, 2001 consisted of one apartment complex located in Tempe, Arizona with a carrying value of $17,021,260 as of that date. The number of units available was 376 with 316 occupied (an 84% occupancy rate). The apartment complex was acquired by the Partnership through a like-kind exchange in 1999. The acquisition was financed through proceeds of approximately $18,600,000 received from the issuance of mortgage notes. These notes were subsequently refinanced through the issuance of a $16,000,000 mortgage note and the issuance of general promissory notes totaling $4,050,000. See Item 7a - Quantitative and Qualitative Disclosures About Market Risk. These general promissory notes include a feature, which will allow the holders to potentially share in appreciation of the property, upon certain circumstances being met. There can be no assurances that the property will appreciate in value. The Partnership does not anticipate acquiring additional properties. The Partnership has no outside lines of credit on which to draw for its working capital needs. Neither the General Partner and its affiliates nor Meridian Realty Advisors, Inc. have any obligation to provide financial support to the Partnership, except as required by the senior participation note agreements. (See note 5.) Accordingly, continued operations of the Partnership is dependent on the Partnership being able to generate cash flow from operations or sale of its remaining operating property or negotiated reductions in requirements related to outstanding debt obligations. If the Partnership is unable to either generate sufficient operating cash flow or renegotiate its debt structure, the Partnership could be forced to curtail or cease its operations. Operations did not generate sufficient cash flows in 2001 to pay the expenses of the partnership. Affiliates of the general partner have advanced to the Partnership $229,125 through December 31, 2001 to enable it to meet its cash requirements. There is no assurance that the general partner will fund the debt service of the senior participation notes in the future. The property is currently being marketed after a management decision in October 2001 to sell the property. The net proceeds, if any, from the sale will be distributed to income unit holders after all obligations have been paid. It is the general partner's intent to dissolve the Partnership once these distributions have been made. There is no assurance that sufficient, if any, proceeds will be available to satisfy all outstanding obligations of the property. NOTE 3 - TRANSACTIONS WITH AFFILIATES Subordinated Real Estate commissions Under the Partnership Agreement, the General Partners or an affiliate is entitled to a subordinated real estate commission upon the sale of partnership properties. Payment of the commission is subordinated to distributions to the Limited Partners of original invested capital plus a 9% per annum cumulative return. Subordinated real estate commissions payable totaled $548,757 at both December 31, 2001 and 2000. F10 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 3 - TRANSACTIONS WITH AFFILIATES (CONTINUED) Compensation and Cost Reimbursement Compensation and reimbursements paid to or accrued for the benefit of OSGPC and affiliates for the years ending December 31:
2001 2000 1999 ---------- ---------- ---------- Asset management fee $ 90,000 $ 112,500 $ 112,500 Partnership and Financial administration, data processing, accounting and tax reporting, and investor relations 22,565 27,178 25,000 ---------- ---------- ---------- Total compensation and reimbursements $ 112,565 $ 139,678 $ 137,500 ========== ========== ==========
NOTE 4 - PROPERTY HELD FOR SALE The cost, accumulated depreciation and carrying value of the Partnership's Property held for sale at December 31, 2001 and 2000, is set forth in the following tables:
Number Buildings and Accumulated of Units Land Improvements Depreciation Total ------------ ------------ ------------- ------------ ------------ 2001 Superstition Park Apartments 376 $ 2,045,356 $ 14,975,904 $ -- $ 17,021,260 ============ ============ ============ ============ 2000 Superstition Park Apartments 376 $ 2,045,356 $ 18,414,312 $ (1,102,994) $ 19,356,674 ============ ============ ============ ============
At December 31, 2001 an impairment charge of $2,100,000 has been recorded against the depreciated and amortized cost basis of the real estate property (Superstition Park Apartments) held for sale and against the deferred borrowing costs (see Note 6). This impairment charge is based on the current and estimated future levels of occupancy of the property, potential rehabilitation costs and the local real estate market conditions. The impairment results in a new cost basis for both the property and the deferred borrowing costs. F11 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 5 - NOTES PAYABLE The following is a summary of notes payable.
December 31, --------------------------- 2001 2000 ------------ ------------ Mortgage payable bearing interest at 7.765%, secured by the Property held for sale, payable in monthly installments of principal and interest of $114,792; maturing January 2010 $ 15,758,530 $ 15,889,787 Non-recourse 10% general obligation promissory notes, maturing during the years ending December 31, 2004 and 2005 with an option to extend the maturity date to December 31, 2006 under different terms and interest payable quarterly. These notes are secured by a security interest in the Partnership's 0.1% Class B voting limited partnership interest in MMF1 99-IV The notes contain a participation feature whereas the holder of the notes could possibly share in the appreciation of the real estate investment at the time that the property is sold. The property will have to be sold for more than $21,250,000 before the holders of these notes will share in the any appreciation. The Company has not recorded a participation liability for this participation feature as management has estimated that the appreciation of the real investment over the term of these notes will be minimal, if any. The actual appreciation in the real estate investment could differ from management's estimate resulting in a future liability. These note agreements further preclude the Partnership from making distributions in excess of capital contributions, unless all the principal and interest then due on these notes are paid in full, except for state tax obligations of foreign partners. The senior participation note agreements call for additional capital contributions to be made by the general partner in years 2002 through 2005 in the event that the Partnership is in default of the interest payments. However the failure to make current interest payments will not cause an event of default unless the Partnership has received sufficient funds from the property. (See note 2) These additional contributions are to be used to make payment on the accrued interest 4,050,000 4,050,000 ------------ ------------ $ 19,808,530 $ 19,939,787 ============ ============
Scheduled principal maturities of the notes payable under existing terms are as follows at December 31, 2001: 2002 $ 141,972 2003 153,562 2004 4,212,564 2005 179,368 2006 194,010 Thereafter 14,927,054 --------------- Total $ 19,808,530 ===============
F12 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 6 - DEFERRED BORROWING COSTS The following is a summary of deferred borrowing costs:
December 31, ------------------------ 2001 2000 ---------- ---------- Deferred borrowing costs incurred on the 7.765% mortgage payable secured by real estate investments $ 201,547 $ 201,547 Deferred borrowing costs incurred on the 10% non-recourse general obligation promissory notes 417,135 417,135 Accumulated amortization (206,824) (103,514) Impairment (Note 4) (411,858) -- ---------- ---------- Deferred borrowing costs, net of accumulated amortization $ -- $ 515,168 ========== ==========
NOTE 7 - DISTRIBUTIONS Distributions of cash from operations, to the extent deemed available by the General Partner for distribution, are allocated 92% to the Limited Partners and 8% to the General Partner, and are made in the following order: (a) First to the holders of Income Units until they receive a return of 9% per annum cumulative on their adjusted capital investment; then, (b) to the holders of Growth/Shelter Units until they receive a non-cumulative return for the year of distribution equal to 5% per annum on their adjusted capital investment; then, (c) to all the Limited Partners based on number of Units held. Distributions of cash from other sources, including sales and refinancing and cash reserves, are made in the following order: (a) First, 99% to the Limited Partners and 1% to the General Partner until the Limited Partners have received a return of their aggregate capital investment plus a 9% per annum cumulative return on their adjusted capital investment. In this regard, distributions to the Limited Partners are allocated first to holders of Income Units until they have received their entire capital investment and their 9% return. Holders of Growth/Shelter Units then receive return of their entire capital investment and their 9% return. Further distributions to the Limited Partners under this section are allocated generally 20% to holders of Income Units and 80% to holders of Growth/Shelter Units. Distributions then continue; (b) to the General Partner until the General Partner has received 12% of all distributions from other sources; then, (c) 12% to the General Partner and 88% to all the Limited Partners. The Partnership did not make distributions during the years ended December 31, 1999 and 2001. However distributions of $18,715 paid during 2000 were for state income taxes withheld and remitted to the State of California on prior year distributions. Cumulative distributions through December 31, 2001, were $16,905,944, $1,786,307, and $590,957 to the Income, Growth/Shelter, and General Partners, respectively. F13 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 8 - SALE AND ACQUISITION ACTIVITIES Sale of Washington Towne Apartments On April 1, 1999, the Partnership sold Washington Towne Apartments to an unrelated third party for $4,100,000. The transaction was recorded as follows: Net cash received $ 1,914,994 Real estate investment (1,667,797) Accrued interest 275,369 Deferred borrowing costs (94,100) Other assets, liabilities and expenses 113,312 Mortgage notes 1,671,157 ------------ Gain $ 2,212,935 ============
A portion of this transaction was accounted for as a non-cash transaction in the accompanying consolidated statements of cash flows. Purchase of Superstition Park Apartments On July 1, 1999, the Partnership purchased Superstition Park Apartments for $20,400,000. The transaction was recorded as follows: Real estate investment $ 20,253,562 Accrued interest (893) Other assets, liabilities and expenses 277,478 Mortgage notes (18,630,000) ------------ Net cash paid $ 1,900,147 ============
A portion of this transaction was accounted for as a non-cash transaction in the accompanying consolidated statements of cash flows. Considering that the sale of the Washington Towne Apartments, and the purchase of the Superstition Park Apartments took place in 1999, the operating results of the Partnership are not comparable between 1999 and 2000. NOTE 9 - PRO FORMA INFORMATION Pro forma information for the year ended December 31, 1999 has not been provided for the acquisition of Superstition Park Apartments, as the historical information for Superstition Park Apartments is not available. NOTE 10 - COMMITMENTS AND CONTINGENCIES A tenant of the Glasshouse Square shopping center (sold in 1998) filed an action against the Partnership and the current owner of the Glasshouse Square shopping center in the San Diego Superior Court. This case involves the failure of a sewer line that served the tenant's premises. The tenant alleged that the defendants are liable for the cost of approximately $90,000 to repair the sewer line and $26,000 of profits lost due to this sewer line's failure. The tenant also seeks to recover its attorney's fees and costs in the action under the terms of the lease. The amounts of fees and costs incurred by the tenant are unknown. F14 UNIVERSITY REAL ESTATE PARTNERSHIP V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 10 - COMMITMENTS AND CONTINGENCIES (CONTINUED) The tenant rejected initial attempts to discuss a settlement. The partnership answered the tenant's complaint by filing a cross-complaint for indemnity against the current owner of the property. The partnership prevailed against the tenant on a motion for summary judgment in December of 2001. The tenant appealed that ruling; however, the court upheld its prior ruling and the partnership again prevailed on its motion. The tenant is thought to be in the process of filing an appeal with the California Court of Appeals although no notice has been received by the Partnership. It is not possible to predict the outcome of the motion or the claims against the current owner of the Glasshouse Square shopping center. No accrual has been made in the financial statements in respect of this matter. There are no other material pending legal proceedings to which the Partnership is a party or to which its property is subject. NOTE 11 - RECLASSIFICATIONS Certain reclassifications have been made to the prior year's consolidated financial statements in order to conform them to the classifications used for the current year. These reclassifications had no effect on previously reported net income (loss) or partners' equity (deficit). F15 UNIVERSITY REAL ESTATE PARTNERSHIP V SCHEDULE OF REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION AND AMORTIZATION December 31, 2001
Gross Amount at Initial Costs Costs Which Carried at Close of Period ------------------------- Capitalized -------------------------------------- Related Buildings and Subsequent to Impairment Buildings and Description Encumbrances Land Improvements Acquisition Charge Land Improvements Total(s) ----------- ------------ ---------- ------------- ------------- ---------- ---------- ------------- ----------- Superstition Park Apartments Tempe, AZ $ 15,758,530 $2,045,356 $ 18,208,206 $ 328,403 $1,688,142 $2,045,356 $ 14,975,904 $17,021,260 ============ ========== ============= ============= ========== ========== ============= ===========
Accumulated Depreciation And Date of Date Depreciable Description Amortization Construction Acquired Lives (Years) ----------- ------------ ------------ -------- ------------- Superstition Park Apartments Tempe, AZ $ -- 1985 7/99 5-25 ============
F16 UNIVERSITY REAL ESTATE PARTNERSHIP V SCHEDULE OF REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION AND AMORTIZATION Year Ended December 31, 2001, 2000 and 1999 Changes in real estate investments and accumulated depreciation and amortization are as follows:
For the Year Ended December 31, ------------------------------------------- 2001 2000 1999 ------------ ------------ ------------ Real estate: Balance at beginning of year $ 20,459,668 $ 20,253,562 $ 2,588,078 Acquisitions -- -- 20,253,562 Improvements 122,297 206,106 -- New basis adjustment (3,560,705) -- -- Dispositions -- -- (2,588,078) ------------ ------------ ------------ Balance at end of year $ 17,021,260 $ 20,459,668 $ 20,253,562 ============ ============ ============ Accumulated depreciation and amortization: Balance at beginning of year $ 1,102,994 $ 364,164 $ 875,241 Depreciation and amortization 769,569 738,830 409,204 New basis adjustment (1,872,563) -- -- Dispositions -- -- (920,281) ------------ ------------ ------------ Balance at end of year $ -- $ 1,102,994 $ 364,164 ============ ============ ============ Net $ 17,021,260 $ 19,356,674 $ 19,889,398 ============ ============ ============
F17 UNIVERSITY REAL ESTATE PARTNERSHIP V SCHEDULE OF MORTGAGE LOANS ON REAL ESTATE December 31, 2001
Principal Amount Final Periodic Face Carrying of Loans Subject Maturity Payment Prior Amount of Amount of to Delinquent Description Interest Rate Date Terms Liens Mortgage Mortgage Principal or Interest -------------------------------- ------------- ------------ -------- ----- ----------- ----------- --------------------- Mortgage payable on Superstition Park Apartments, secured by a first lien deed of trust 7.765% January 2010 (1) None $16,000,000 $15,758,530 None
(1) Monthly installments of principal and interest of $114,792 F18 PART III ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The Partnership does not have officers or directors. University Advisory Company is the General Partner of the Partnership. OS General Partner Company and OS Holdings, Inc., are the two general partners of UAC. The executive officer and director of the General Partner who controls the affairs of the Partnership is as follows:
Name and Position Age Other Principal Occupations and Other Directorships During the Past 5 Years ----------------- --- --------------------------------------------------------------------------- Curtis R. Boisfontaine, Jr., 42 From 1991 to the present, Mr. Boisfontaine has served as Chief Executive President and Chairman of Officer of Hampton Real Estate Group and as President of Meridian Capital the Board of Directors of OS Corporation. OSGPC was formed in 1995 and Mr. Boisfontaine is the majority General Partner Company shareholder, President and sole director of OSGPC. David K. Ronck, Vice 42 From 1995 to the present, Mr. Ronck has served as Vice President-Chief President and Chief Financial Officer and President of Meridian Realty Advisors, Inc. Prior to Financial Officer of OS that time, Mr. Ronck served as President of ConCap Equities, Inc., the General Partner Company General Partner of fifteen public limited partnerships. He is Vice President and Chief Financial Officer for OSGPC.
ITEM 11. EXECUTIVE COMPENSATION No individual principal or principals as a group received over $60,000 in direct remuneration from the Registrant. The General Partner is not compensated directly for services rendered to the Partnership. Certain officers and directors of the General Partner and Hampton receive compensation from the General Partner or Hampton and/or their affiliates (but not from the Registrant) for services performed for various affiliated entities which may include services performed for the Registrant. See "Item 13 - Certain Relationships and Related Transactions" and Note 3 to the consolidated financial statements appearing in Item 8. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT (A) Security Ownership of certain beneficial owners.
Title of class Name of beneficial owner Number of units Percentage of class -------------- ------------------------ --------------- ------------------- Income Units UREP V Acquisitions, L.P. 3,672 20.72% Growth Units UREP V Acquisitions, L.P. 2,486 15.22%
(B) Security ownership of management. Neither the General Partner nor any of its officers or directors owns any Limited Partnership Units. The General Partner is entitled to distributions of cash from operations and from other sources (primarily from the sale or refinancing of Partnership properties and the reserve account) as set forth in Item 8 - "Note 7 - Distributions." (C) Change in Control. None. 17 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Compensation or reimbursements paid to or accrued for the benefit of OS General Partner Company during 2001 are as follows: Asset management fees $ 90,000 Charged to general and administrative expense: Partnership and financial administration, accounting and tax reporting, and investor relations 22,565 -------- Total compensation and reimbursements $112,565 ========
PART IV ITEM 14. EXHIBITS, CONSOLIDATED FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K (a)(1) Consolidated Financial Statements Consolidated Financial Statements for University Real Estate Partnership V, listed in the Index to the Consolidated Financial Statements and Supplementary Data on page 16, are filed as part of this Annual Report. (a)(2) Consolidated Financial Statement Schedules Consolidated Financial Statement Supplementary Data for University Real Estate Partnership V, listed in the Index to the Consolidated Financial Statements and Supplementary Data on page 16, are filed as part of this Annual Report. (a)(3) Index to Exhibits.................................................. 19 (b) Reports on Form 8-K None. 18 (a)(3) The following documents are filed as part of this report and is an index to the exhibits: Exhibit Number Description 3.1 Limited Partnership Agreement (Incorporated by reference to Registration Statement No. 2-74914 on Form S-11 filed by Registrant). 3.2i Articles of Incorporation of Washington Towne, Inc. executed on August 9, 1995.(6) 3.2ii Washington Towne, Inc. Bylaws.(6) 3.3i Articles of Organization of Washington Towne Apartments, L.L.C. executed on August 9, 1995.(6) 3.3ii Operating Agreement of Washington Towne Apartments, L.L.C. entered into and effective August 9, 1995 by and between Washington Towne, Inc., a Georgia corporation and University Real Estate Partnership V, a California limited partnership.(6) 4. Limited Partnership Agreement (Incorporated by reference to Registration Statement No. 2-74914 on Form S-11 filed by Registrant). 4.1 Trust Indenture Agreement (Incorporated by reference to Exhibit 4.1 to Registration Statement 2-74914 on Form S-11 filed by Registrant). 10.1 Asset Purchase Agreement among Southmark Corporation and its affiliates and SHL Acquisition Corp. III dated March 9, 1993.(2) 10.2 Asset Purchase Agreement among Southmark Corporation and its affiliates and SHL Acquisition Corp. III dated March 9, 1993 as amended by the First Amendment to Asset Purchase Agreement dated April 22, 1993. Incorporated by reference to the Annual Report of the Registrant on Form 10-K for the period ended December 31, 1992, as filed with the Securities and Exchange Commission on May 1, 1993. 10.3 Asset Purchase Agreement among Southmark Corporation and its affiliates and SHL Corp. III dated March 9, 1993, as amended by the Second Amendment to Asset Purchase Agreement dated December 14, 1993.(2) 10.4 University V Option Agreement entered into as of December 16, 1993, by and among University Advisory Company and Hampton Realty Partners, L.P. and/or its Permitted Assigns.(3) 10.5 Portfolio Services Agreement between the Partnership and Hampton UREF Management, Ltd. dated December 16, 1993 to be effective as of December 14, 1992.(3) 10.6 Assignment of Rights of the Asset Purchase Agreement between SHL Acquisition Corp. III and Hampton HCW, Hampton Realty Partners, L.P., and Hampton UREF Management, Ltd. dated December 16, 1993.(3) 10.7 Portfolio Service Subcontract between Hampton UREF Management, Ltd. and IFGP Corporation dated April 20, 1994.(3) 10.8 Property Management Subcontract between Hampton UREF Management, Ltd. and Insignia Management Group, L.P. dated April 20, 1994.(3) 10.9 Purchase Agreement between Hampton Realty Partners, L.P. and Insignia Financial Group, Inc. dated April 20, 1994.(3) 19 10.10 Note dated June 10, 1994 by and between University Real Estate Partnership V, a California limited partnership, and Southmark Corporation, a Georgia corporation, in the amount of $877,000.00.(3) 10.11 Settlement Agreement between PDP Venture V, a California limited partnership, and University Real Estate Partnership V, a California limited partnership, dated June 20, 1994.(3) 10.12 Portfolio Services Subcontract Agreement between Hampton UREF Management, Ltd. and IFGP Corporation dated April 20, 1994 as amended July 31, 1994.(3) 10.13 Termination of Purchase Agreement between Hampton Realty Partners, L.P. and Insignia Financial Group, Inc. dated August 8, 1994.(3) 10.14 Property Management Subcontract Agreement between Hampton UREF Management, Ltd. and Insignia Management Group, L.P. dated April 20, 1994, as amended August 8, 1994.(3) 10.15 Termination of Property Management Agreement between Hampton UREF Management, Ltd. and the Partnership dated August 8, 1994.(3) 10.16 Property Management Agreement between the Partnership and Insignia Commercial Group, Inc. dated August 8, 1994.(3) 10.17 Termination of Property Management Subcontract Agreement between Hampton UREF Management, Ltd. and Insignia Management Group, Ltd. dated September 1, 1994.(3) 10.18 Assignment and Assumption of Portfolio Services Agreement between Hampton UREF Management, Ltd. and JKD Financial Management, Inc. dated December 30, 1994.(4) 10.19 Assignment and Assumption of Option Agreement between Hampton Realty Partners, L.P. and JKD Financial Management, Inc. dated December 30, 1994.(4) 10.20 Modification and/or Extension Agreement dated March 27, 1995 by and between Imperial Bank, a California banking corporation, and University Real Estate Partnership V, a California limited partnership.(5) 10.21 Disbursement Agreement and Deed of Trust dated March 27, 1995, between Imperial Bank, a California banking corporation, and University Real Estate Partnership V, a California limited partnership for the additional line of credit granted to the Partnership in the amount of $400,000.(5) 10.22 Forbearance Agreement dated March 27, 1995 by and between University Real Estate Partnership V, a California limited partnership and Imperial Bank, a California banking corporation.(5) 10.23 Note dated March 31, 1995 by and between University Real Estate Partnership V, a California limited partnership, and Imperial Bank, a California banking corporation in the amount of $250,000.(5) 10.24 Amended and Restated Forbearance Agreement entered into on April 28, 1995 by and between University Real Estate Partnership V, a California limited partnership and Imperial Bank, a California banking corporation.(5) 20 10.25 Promissory Note dated September 13, 1995 by and between Washington Towne Apartments, L.L.C. and First Union National Bank of North Carolina for the principal amount of $1,750,000.(6) 10.26 Deed to Secure Debt and Security Agreement dated September 13, 1995 by and between Washington Towne Apartments, L.L.C. and First Union National Bank of North Carolina.(6) 10.27 Assignment of Leases and Rents dated September 13, 1995, by and between Washington Apartments, L.L.C. and First Union Bank of North Carolina.(6) 10.28 Indemnity and Guaranty Agreement dated September 13, 1995 by and between University Real Estate Partnership V and First Union National Bank.(6) 10.29 Promissory Note dated June 30, 1999 by and between Meridian Superstition Park Investors, L.L.C. and Heller Financial, Inc. for the principal amount of $13,630,000.(23) 10.30 Promissory Note dated June 30, 1999 by and between Meridian Superstition Park Investors, L.L.C. and Heller Financial, Inc. for the principal amount of $5,000,000.(23) 10.31 Note dated December 15, 1999 by and between Meridian Superstition Park Investors, L.L.C., and Berkshire Mortgage Finance Limited Partnership for the principal amount of $16,000,000.(23) 10.32 10% Senior Participating Notes dated from June 30, 1999 through January 12, 2000 by and between Meridian Multi-Family Investors 99-IV, L.P. and 81 note holders for the principal amount of $50,000 each and aggregating $4,050,000.(27) 11. Statement regarding computation of Net Loss per Limited Partnership Unit: Net Loss per Limited Partnership Unit is computed by dividing net loss allocated to the Limited Partners by the number of Limited Partnership Units outstanding. Per unit information has been computed based on 34,301, 34,353 and 34,453 Limited Partnership Units outstanding in 1996, 1995 and 1994, respectively. 16. Letter dated July 18, 1995 from Price Waterhouse LLP with respect to a change in certifying accountant. Incorporated by reference to Form 8-K - Current Report for the period ending September 30, 1995, as filed with the Securities and Exchange Commission on July 24, 1995. (2) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1993, as filed with the Securities and Exchange Commission on March 30, 1995. (3) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1994, as filed with the Securities and Exchange Commission on October 6, 1995. (4) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1994, as filed with the Securities and Exchange Commission on October 10, 1995. (5) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ending March 31, 1995, as filed with the Securities and Exchange Commission on November 20, 1995. (6) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ending September 30, 1995, as filed with the Securities and Exchange Commission on May 23, 1996. (7) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1996, as filed with the Securities and Exchange Commission on May 23, 1996. 21 (8) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1995, as filed with the Securities and Exchange Commission on July 18, 1996. (9) Incorporated by reference to Quarterly Report of the Registrant on form 10-Q for the period ending June 30, 1996, as filed with the Securities and Exchange Commission on July 31, 1996. (10) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1996, as filed with the Securities and Exchange Commission on November 14, 1996. (11) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1996, as filed with the Securities and Exchange Commission on April 16, 1997. (12) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1997, as filed with the Securities and Exchange Commission on May 14, 1997. (13) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 1997, as filed with the Securities and Exchange Commission on August 14, 1997. (14) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1997, as filed with the Securities and Exchange Commission on November 14, 1997. (15) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1997, as filed with the Securities and Exchange Commission on April 1, 1998. (16) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1998, as filed with the Securities and Exchange Commission on May 15, 1998. (17) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 1998, as filed with the Securities and Exchange Commission on September 23, 1998. (18) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1998, as filed with the Securities and Exchange Commission on November 11, 1998. (19) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1998, as filed with the Securities and Exchange Commission on May 13, 1999. (20) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1999, as filed with the Securities and Exchange Commission on May 21, 1999. (21) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 1999, as filed with the Securities and Exchange Commission on August 24, 1999 (22) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1999, as filed with the Securities and Exchange Commission on November 15, 1999. (23) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1999, as filed with the Securities and Exchange Commission on March 30, 2000. (24) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 2000, as filed with the Securities and Exchange Commission on December 12, 2000. (25) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 2000, as filed with the Securities and Exchange Commission on January 15, 2002. (26) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 2000, as filed with the Securities and Exchange Commission on January 15, 2002. 22 (27) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 2000, as filed with the Securities and Exchange Commission on January 15, 2002 (28) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 2001, as filed with the Securities and Exchange Commission on May 6, 2002. (29) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 2001, as filed with the Securities and Exchange Commission on May 6, 2002. (30) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 2001, as filed with the Securities and Exchange Commission on May 6, 2002. 23 UNIVERSITY REAL ESTATE PARTNERSHIP V SIGNATURE PAGE Pursuant to the requirements of Section 13 or 15(d) 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. UNIVERSITY REAL ESTATE PARTNERSHIP V By: UNIVERSITY ADVISORY COMPANY General Partner By: OS GENERAL PARTNER COMPANY May 10, 2002 By: /s/ Curtis R. Boisfontaine, Jr. ---------------------------------- -------------------------------------- Date Curtis R. Boisfontaine, Jr., President Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. May 10, 2002 By: /s/ Curtis R. Boisfontaine, Jr. ---------------------------------- -------------------------------------- Date Curtis R. Boisfontaine, Jr., President, Principal Executive Officer and Director of OS General Partner Company May 10, 2002 By: /s/ David K. Ronck ---------------------------------- -------------------------------------- Date David K. Ronck Vice President and Chief Accounting Officer of OS General Partner Company 24 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------ ----------- 3.1 Limited Partnership Agreement (Incorporated by reference to Registration Statement No. 2-74914 on Form S-11 filed by Registrant). 3.2i Articles of Incorporation of Washington Towne, Inc. executed on August 9, 1995.(6) 3.2ii Washington Towne, Inc. Bylaws.(6) 3.3i Articles of Organization of Washington Towne Apartments, L.L.C. executed on August 9, 1995.(6) 3.3ii Operating Agreement of Washington Towne Apartments, L.L.C. entered into and effective August 9, 1995 by and between Washington Towne, Inc., a Georgia corporation and University Real Estate Partnership V, a California limited partnership.(6) 4. Limited Partnership Agreement (Incorporated by reference to Registration Statement No. 2-74914 on Form S-11 filed by Registrant). 4.1 Trust Indenture Agreement (Incorporated by reference to Exhibit 4.1 to Registration Statement 2-74914 on Form S-11 filed by Registrant). 10.1 Asset Purchase Agreement among Southmark Corporation and its affiliates and SHL Acquisition Corp. III dated March 9, 1993.(2) 10.2 Asset Purchase Agreement among Southmark Corporation and its affiliates and SHL Acquisition Corp. III dated March 9, 1993 as amended by the First Amendment to Asset Purchase Agreement dated April 22, 1993. Incorporated by reference to the Annual Report of the Registrant on Form 10-K for the period ended December 31, 1992, as filed with the Securities and Exchange Commission on May 1, 1993. 10.3 Asset Purchase Agreement among Southmark Corporation and its affiliates and SHL Corp. III dated March 9, 1993, as amended by the Second Amendment to Asset Purchase Agreement dated December 14, 1993.(2) 10.4 University V Option Agreement entered into as of December 16, 1993, by and among University Advisory Company and Hampton Realty Partners, L.P. and/or its Permitted Assigns.(3) 10.5 Portfolio Services Agreement between the Partnership and Hampton UREF Management, Ltd. dated December 16, 1993 to be effective as of December 14, 1992.(3) 10.6 Assignment of Rights of the Asset Purchase Agreement between SHL Acquisition Corp. III and Hampton HCW, Hampton Realty Partners, L.P., and Hampton UREF Management, Ltd. dated December 16, 1993.(3) 10.7 Portfolio Service Subcontract between Hampton UREF Management, Ltd. and IFGP Corporation dated April 20, 1994.(3) 10.8 Property Management Subcontract between Hampton UREF Management, Ltd. and Insignia Management Group, L.P. dated April 20, 1994.(3) 10.9 Purchase Agreement between Hampton Realty Partners, L.P. and Insignia Financial Group, Inc. dated April 20, 1994.(3)
10.10 Note dated June 10, 1994 by and between University Real Estate Partnership V, a California limited partnership, and Southmark Corporation, a Georgia corporation, in the amount of $877,000.00.(3) 10.11 Settlement Agreement between PDP Venture V, a California limited partnership, and University Real Estate Partnership V, a California limited partnership, dated June 20, 1994.(3) 10.12 Portfolio Services Subcontract Agreement between Hampton UREF Management, Ltd. and IFGP Corporation dated April 20, 1994 as amended July 31, 1994.(3) 10.13 Termination of Purchase Agreement between Hampton Realty Partners, L.P. and Insignia Financial Group, Inc. dated August 8, 1994.(3) 10.14 Property Management Subcontract Agreement between Hampton UREF Management, Ltd. and Insignia Management Group, L.P. dated April 20, 1994, as amended August 8, 1994.(3) 10.15 Termination of Property Management Agreement between Hampton UREF Management, Ltd. and the Partnership dated August 8, 1994.(3) 10.16 Property Management Agreement between the Partnership and Insignia Commercial Group, Inc. dated August 8, 1994.(3) 10.17 Termination of Property Management Subcontract Agreement between Hampton UREF Management, Ltd. and Insignia Management Group, Ltd. dated September 1, 1994.(3) 10.18 Assignment and Assumption of Portfolio Services Agreement between Hampton UREF Management, Ltd. and JKD Financial Management, Inc. dated December 30, 1994.(4) 10.19 Assignment and Assumption of Option Agreement between Hampton Realty Partners, L.P. and JKD Financial Management, Inc. dated December 30, 1994.(4) 10.20 Modification and/or Extension Agreement dated March 27, 1995 by and between Imperial Bank, a California banking corporation, and University Real Estate Partnership V, a California limited partnership.(5) 10.21 Disbursement Agreement and Deed of Trust dated March 27, 1995, between Imperial Bank, a California banking corporation, and University Real Estate Partnership V, a California limited partnership for the additional line of credit granted to the Partnership in the amount of $400,000.(5) 10.22 Forbearance Agreement dated March 27, 1995 by and between University Real Estate Partnership V, a California limited partnership and Imperial Bank, a California banking corporation.(5) 10.23 Note dated March 31, 1995 by and between University Real Estate Partnership V, a California limited partnership, and Imperial Bank, a California banking corporation in the amount of $250,000.(5) 10.24 Amended and Restated Forbearance Agreement entered into on April 28, 1995 by and between University Real Estate Partnership V, a California limited partnership and Imperial Bank, a California banking corporation.(5)
10.25 Promissory Note dated September 13, 1995 by and between Washington Towne Apartments, L.L.C. and First Union National Bank of North Carolina for the principal amount of $1,750,000.(6) 10.26 Deed to Secure Debt and Security Agreement dated September 13, 1995 by and between Washington Towne Apartments, L.L.C. and First Union National Bank of North Carolina.(6) 10.27 Assignment of Leases and Rents dated September 13, 1995, by and between Washington Apartments, L.L.C. and First Union Bank of North Carolina.(6) 10.28 Indemnity and Guaranty Agreement dated September 13, 1995 by and between University Real Estate Partnership V and First Union National Bank.(6) 10.29 Promissory Note dated June 30, 1999 by and between Meridian Superstition Park Investors, L.L.C. and Heller Financial, Inc. for the principal amount of $13,630,000.(23) 10.30 Promissory Note dated June 30, 1999 by and between Meridian Superstition Park Investors, L.L.C. and Heller Financial, Inc. for the principal amount of $5,000,000.(23) 10.31 Note dated December 15, 1999 by and between Meridian Superstition Park Investors, L.L.C., and Berkshire Mortgage Finance Limited Partnership for the principal amount of $16,000,000.(23) 10.32 10% Senior Participating Notes dated from June 30, 1999 through January 12, 2000 by and between Meridian Multi-Family Investors 99-IV, L.P. and 81 note holders for the principal amount of $50,000 each and aggregating $4,050,000.(27) 11. Statement regarding computation of Net Loss per Limited Partnership Unit: Net Loss per Limited Partnership Unit is computed by dividing net loss allocated to the Limited Partners by the number of Limited Partnership Units outstanding. Per unit information has been computed based on 34,301, 34,353 and 34,453 Limited Partnership Units outstanding in 1996, 1995 and 1994, respectively. 16. Letter dated July 18, 1995 from Price Waterhouse LLP with respect to a change in certifying accountant. Incorporated by reference to Form 8-K - Current Report for the period ending September 30, 1995, as filed with the Securities and Exchange Commission on July 24, 1995. (2) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1993, as filed with the Securities and Exchange Commission on March 30, 1995. (3) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1994, as filed with the Securities and Exchange Commission on October 6, 1995. (4) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1994, as filed with the Securities and Exchange Commission on October 10, 1995. (5) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ending March 31, 1995, as filed with the Securities and Exchange Commission on November 20, 1995. (6) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ending September 30, 1995, as filed with the Securities and Exchange Commission on May 23, 1996. (7) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1996, as filed with the Securities and Exchange Commission on May 23, 1996.
(8) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1995, as filed with the Securities and Exchange Commission on July 18, 1996. (9) Incorporated by reference to Quarterly Report of the Registrant on form 10-Q for the period ending June 30, 1996, as filed with the Securities and Exchange Commission on July 31, 1996. (10) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1996, as filed with the Securities and Exchange Commission on November 14, 1996. (11) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1996, as filed with the Securities and Exchange Commission on April 16, 1997. (12) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1997, as filed with the Securities and Exchange Commission on May 14, 1997. (13) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 1997, as filed with the Securities and Exchange Commission on August 14, 1997. (14) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1997, as filed with the Securities and Exchange Commission on November 14, 1997. (15) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1997, as filed with the Securities and Exchange Commission on April 1, 1998. (16) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1998, as filed with the Securities and Exchange Commission on May 15, 1998. (17) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 1998, as filed with the Securities and Exchange Commission on September 23, 1998. (18) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1998, as filed with the Securities and Exchange Commission on November 11, 1998. (19) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1998, as filed with the Securities and Exchange Commission on May 13, 1999. (20) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 1999, as filed with the Securities and Exchange Commission on May 21, 1999. (21) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 1999, as filed with the Securities and Exchange Commission on August 24, 1999 (22) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 1999, as filed with the Securities and Exchange Commission on November 15, 1999. (23) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 1999, as filed with the Securities and Exchange Commission on March 30, 2000. (24) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 2000, as filed with the Securities and Exchange Commission on December 12, 2000. (25) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 2000, as filed with the Securities and Exchange Commission on January 15, 2002. (26) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 2000, as filed with the Securities and Exchange Commission on January 15, 2002.
(27) Incorporated by reference to Annual Report of the Registrant on Form 10-K for the period ended December 31, 2000, as filed with the Securities and Exchange Commission on January 15, 2002 (28) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended March 31, 2001, as filed with the Securities and Exchange Commission on May 6, 2002. (29) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended June 30, 2001, as filed with the Securities and Exchange Commission on May 6, 2002. (30) Incorporated by reference to Quarterly Report of the Registrant on Form 10-Q for the period ended September 30, 2001, as filed with the Securities and Exchange Commission on May 6, 2002.