-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MGlDJ5J5W+EOPLZzMBYkCmCd8QuEeHZaI307GseQek6nPcMdZaDzXCKg7iRn+yUq 5MZ5pfGXlrIXb9VzyVBJ9Q== 0000950147-98-000586.txt : 19980807 0000950147-98-000586.hdr.sgml : 19980807 ACCESSION NUMBER: 0000950147-98-000586 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980806 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PARTICIPATING INCOME PROPERTIES II LP CENTRAL INDEX KEY: 0000820806 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF NONRESIDENTIAL BUILDINGS [6512] IRS NUMBER: 860588505 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-18504 FILM NUMBER: 98678007 BUSINESS ADDRESS: STREET 1: 17207 N PERIMETER DR STREET 2: SCOTTSDALE PERIMETER DRIVE CITY: SCOTTSDALE STATE: AZ ZIP: 85255 BUSINESS PHONE: 6025854500 MAIL ADDRESS: STREET 1: 17207 N PERIMETER DR CITY: SCOTTSDALE STATE: AZ ZIP: 85255-5402 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FFCA INVESTOR SERVICES CORP 88-C CENTRAL INDEX KEY: 0000820807 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF NONRESIDENTIAL BUILDINGS [6512] IRS NUMBER: 860588507 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-18512 FILM NUMBER: 98678008 BUSINESS ADDRESS: STREET 1: 17207 N PERIMETER DR STREET 2: SCOTTSDALE PERIMETER CENTER CITY: SCOTTSDALE STATE: AZ ZIP: 85255 BUSINESS PHONE: 6025854500 MAIL ADDRESS: STREET 1: 17207 N PERIMETER DR CITY: SCOTTSDALE STATE: AZ ZIP: 85255-5402 10-Q 1 QUARTERLY REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1998 ------------------------------------------- [ ] 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 0-18504 Commission file number 0-18512 PARTICIPATING INCOME PROPERTIES II, L.P. and FFCA INVESTOR SERVICES CORPORATION 88-C - -------------------------------------------------------------------------------- (Exact Name of Co-Registrants as Specified in Their Organizational Documents) Delaware 86-0588505 - -------------------------------------------------------------------------------- (Partnership State of Organization) (Partnership I.R.S. Employer Identification Number) Delaware 86-0588507 - -------------------------------------------------------------------------------- (Corporation State of Incorporation) (Corporation I.R.S. Employer Identification Number) The Perimeter Center 17207 North Perimeter Drive Scottsdale, Arizona 85255 - -------------------------------------------------------------------------------- (Address of principal executive offices) (zip code) Co-Registrants' telephone number including area code (602) 585-4500 ----------------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- PART 1 - FINANCIAL INFORMATION Item l. Financial Statements. ------- --------------------- PARTICIPATING INCOME PROPERTIES II, L.P. BALANCE SHEETS JUNE 30, 1998 AND DECEMBER 31, 1997 (Unaudited)
June 30, December 31, 1998 1997 ------------ ------------ ASSETS ------ CASH AND CASH EQUIVALENTS $ 4,009,516 $ 3,984,265 RECEIVABLES FROM LESSEES 202,300 197,300 DEFERRED COSTS 9,531 -- PROPERTY SUBJECT TO OPERATING LEASES, at cost Land 11,709,570 11,709,570 Buildings 54,004,577 54,004,577 Equipment 3,832,921 3,832,921 ------------ ------------ 69,547,068 69,547,068 Less - Accumulated depreciation 22,023,018 20,814,945 ------------ ------------ 47,524,050 48,732,123 ------------ ------------ Total assets $ 51,745,397 $ 52,913,688 ============ ============ LIABILITIES AND PARTNERS' CAPITAL --------------------------------- DISTRIBUTION PAYABLE TO LIMITED PARTNERS $ 2,188,296 $ 2,132,357 ACCOUNTS PAYABLE AND ACCRUED LIABILITIES 55,850 72,006 DEFERRED INCOME 457,141 594,251 ------------ ------------ Total liabilities 2,701,287 2,798,614 ------------ ------------ PARTNERS' CAPITAL (DEFICIT): General partners (228,137) (217,427) Limited partners 49,272,247 50,332,501 ------------ ------------ Total partners' capital 49,044,110 50,115,074 ------------ ------------ Total liabilities and partners' capital $ 51,745,397 $ 52,913,688 ============ ============
PARTICIPATING INCOME PROPERTIES II, L.P. STATEMENTS OF INCOME FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1998 AND 1997 (Unaudited)
Three Months Three Months Six Months Six Months Ended Ended Ended Ended 6/30/98 6/30/97 6/30/98 6/30/97 ------------ ------------ ---------- ---------- REVENUES: Rental $1,865,905 $1,865,905 $3,731,810 $3,731,810 Participating rentals 639,277 618,708 1,204,502 1,150,225 Interest and other 44,273 43,061 89,484 98,758 Gain on sale of equipment -- -- -- 2,138 ---------- ---------- ---------- ---------- 2,549,455 2,527,674 5,025,796 4,982,931 ---------- ---------- ---------- ---------- EXPENSES: General partner fees 218,570 217,249 429,606 426,350 Depreciation 594,840 756,141 1,208,073 1,522,539 Operating 52,345 45,246 115,290 106,458 ---------- ---------- ---------- ---------- 865,755 1,018,636 1,752,969 2,055,347 ---------- ---------- ---------- ---------- NET INCOME $1,683,700 $1,509,038 $3,272,827 $2,927,584 ========== ========== ========== ========== NET INCOME ALLOCATED TO: General partners $ 16,837 $ 15,090 $ 32,728 $ 29,276 Limited partners 1,666,863 1,493,948 3,240,099 2,898,308 ---------- ---------- ---------- ---------- $1,683,700 $1,509,038 $3,272,827 $2,927,584 ========== ========== ========== ========== NET INCOME PER LIMITED PARTNERSHIP UNIT (based on 82,834 units held by limited partners) $ 20.12 $ 18.04 $ 39.12 $ 34.99 ========== ========== ========== ==========
PARTICIPATING INCOME PROPERTIES II, L.P. STATEMENT OF CHANGES IN PARTNERS' CAPITAL FOR THE SIX MONTHS ENDED JUNE 30, 1998 (Unaudited)
Limited Partners General --------------------------- Partners Number Total Amount of Units Amount Amount ------------ ------------ ------------ ------------ BALANCE, December 31, 1997 $ (217,427) 82,834 $ 50,332,501 $ 50,115,074 Net income 32,728 -- 3,240,099 3,272,827 Distribution to partners (43,438) -- (4,300,353) (4,343,791) ------------ ------------ ------------ ------------ BALANCE, June 30, 1998 $ (228,137) 82,834 $ 49,272,247 $ 49,044,110 ============ ============ ============ ============
PARTICIPATING INCOME PROPERTIES II, L.P. STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997 (Unaudited)
1998 1997 ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 3,272,827 $ 2,927,584 Adjustments to net income: Depreciation 1,208,073 1,522,539 Gain on sale of equipment -- (2,138) Change in assets and liabilities: Increase in receivables from lessees (5,000) (27,218) Increase in deferred costs (9,531) -- Decrease in payable to general partner -- (18,239) Decrease in accounts payable and accrued expenses (16,156) (5,000) Decrease in deferred income (137,110) (137,109) ----------- ----------- Net cash provided by operating activities 4,313,103 4,260,419 ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sale of property -- 42,750 ----------- ----------- CASH FLOWS FOR FINANCING ACTIVITIES: Partner distributions declared (4,343,791) (4,310,875) Increase in distribution payable to limited partners 55,939 99,559 ----------- ----------- Net cash used in financing activities (4,287,852) (4,211,316) ----------- ----------- NET INCREASE IN CASH AND CASH EQUIVALENTS 25,251 91,853 CASH AND CASH EQUIVALENTS, beginning of period 3,984,265 3,790,885 ----------- ----------- CASH AND CASH EQUIVALENTS, end of period $ 4,009,516 $ 3,882,738 =========== ===========
PART I.- FINANCIAL INFORMATION - ------------------------------ Item 2. Management's Discussion and Analysis of - ------ Financial Condition and Results of Operations --------------------------------------------- As of June 30, 1998, Participating Income Properties II, L.P., a Delaware limited partnership, (the Registrant), had received $82,834,000 in gross proceeds from its offering of Units. Net funds available for investment, after payment of sales commissions, organizational costs and acquisition costs, amounted to $71,956,541. The offering of Units is the Registrant's sole source of capital, and since the final closing of limited partnership units was held on December 11, 1989, the Registrant will not receive additional funds from the offering. The Registrant was fully invested in thirteen travel plaza properties by June 1991 and does not anticipate any further capital expenditures. On February 2, 1998, the Registrant entered into a letter of intent with Flying J. Inc. to sell substantially all of the Registrant's assets for cash of approximately $80 million. The sale is subject to certain conditions specified in the letter of intent, including the negotiation and execution of definitive sale and financing agreements with respect to the assets of the Registrant and the approval, by vote, of a majority of the limited partner interests. In accordance with the partnership agreement, sale of substantially all of the assets will result in dissolution of the partnership and liquidation of the Registrant's remaining assets, net of liabilities. There can be no assurance as to the final terms of the proposed transaction, that the conditions will be satisfied or that the proposed transaction will be consummated. The limited partners will receive a proxy statement containing a complete description of the proposed transaction. The Registrant declared a cash distribution to the limited partners of $2,187,885 for the quarter ended June 30, 1998 (the period) which, combined with the first quarter distribution of $2,112,468, amounts to $4,300,353 year to date. During the period, all net proceeds not invested in real estate were invested in Government Agency discount notes and bank repurchase agreements (which are secured by United States Treasury and Government obligations). During the period, the Registrant received base rental revenue pursuant to its lease arrangements in the amount of $1,865,905, unchanged from the comparable period of the prior year (year-to-date base rental revenues are similarly unchanged). Base rental revenue for the period includes the recognition of approximately $69,000 of income previously deferred. In addition, the Registrant received or accrued participating rentals of $639,277 for the period representing an increase over participating rentals of $618,708 for the comparable period in 1997. On June 1, 1996, CFJ Properties (the Registrant's only lessee) curtailed its relationship with a large third party billing company for the trucking industry. The billing company requested changes to its contract that were unacceptable to CFJ Properties' management due to the significant long-term ramifications of the proposed change on CFJ Properties' future business. This resulted in reduced volume and margins, which contributed to low participating rental revenues in the quarter ended June 30, 1997 as compared to the quarter ended June 30, 1998. Participating rentals for the corresponding year-to-date periods were similarly affected. Total expenses decreased by $152,881 during the period ($302,378 year-to-date) as compared to the prior periods due to a decrease in depreciation expense related to the sale of travel plaza equipment in the last twelve months. The decrease in total assets reflected in the Registrant's financial statements filed with this report is mainly attributable to the depreciation allowance, which is deducted for accounting purposes from the cost of the assets on the Registrant's books. In the opinion of management, the financial information included in this report reflects all adjustments necessary for fair presentation. All such adjustments are of a normal recurring nature. FFCA INVESTOR SERVICES CORPORATION 88-C --------------------------------------- BALANCE SHEET - JUNE 30, 1998 ----------------------------- ASSETS Cash $100 Investment in Participating Income Properties II, L.P., at cost 100 ---- Total Assets $200 ==== LIABILITY Payable to Parent $100 ---- STOCKHOLDER'S EQUITY Common Stock; $l par value; 100 shares authorized, issued and outstanding 100 ---- Liability and Stockholder's Equity $200 ==== Note: FFCA Investor Services Corporation 88-C (88-C) was organized on August 11, 1987 to act as the assignor limited partner in Participating Income Properties II, L.P. (PIP-II). The assignor limited partner is the owner of record of the limited partnership units of PIP-II. All rights and powers of 88-C have been assigned to the holders, who are the registered and beneficial owners of the units. Other than to serve as assignor limited partner, 88-C has no other business purpose and will not engage in any other activity or incur any debt. SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have caused this report to be signed on their behalf by the undersigned thereunto duly authorized. PARTICIPATING INCOME PROPERTIES II, L.P. By FRANCHISE FINANCE CORPORATION OF AMERICA II Corporate General Partner Date: August 3, 1998 By /s/ John Barravecchia ------------------------------------------ John Barravecchia, Chief Financial Officer SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the co-registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized. FFCA INVESTOR SERVICES CORPORATION 88-C Date: August 3, 1998 By /s/ John Barravecchia --------------------------------------------- John Barravecchia, President EX-27.1 2 FINANCIAL DATA SCHEDULE FOR 2ND QUARTER 10-Q
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AS OF JUNE 30, 1998 AND THE STATEMENT OF INCOME FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 820806 PARTICIPATING INCOME PROPERTIES II, L.P. 1 U.S. DOLLARS 6-MOS DEC-31-1998 JAN-01-1998 JUN-30-1998 1 4,009,516 0 202,300 0 0 0 69,547,068 22,023,018 51,745,397 0 0 0 0 0 49,044,110 51,745,397 0 5,025,796 0 1,752,969 0 0 0 3,272,827 0 3,272,827 0 0 0 3,272,827 39.51 0
EX-27.2 3 FINANCIAL DATA SCHEDULE FOR 2ND QUARTER 10-Q
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AS OF JUNE 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH BALANCE SHEET. 820807 FFCA INVESTOR SERVICES CORPORATION 88-C 1 U.S. DOLLARS 6-MOS DEC-31-1998 JAN-01-1998 JUN-30-1998 1 100 0 0 0 0 0 0 0 200 0 0 0 0 100 0 200 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
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