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FORM 10-Q--QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
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 period ended September 30, 1998
or
[ ] 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: 33-18089-A
HICKORY HILLS, LTD.
(Exact name of Registrant as specified in its charter)
Tennessee 62-1336904
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification)
One Belle Meade Place, 4400 Harding Road, Suite 500, Nashville,
Tennessee 37205
(Address of principal executive office) (Zip Code)
(615) 292-1040
(Registrant's telephone number, including area code)
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 at least the past 90 days.
YES X NO ___
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PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
HICKORY HILLS, LTD.
(A Tennessee Limited Partnership)
FINANCIAL STATEMENTS
For The Three and Nine Months Ended September 30, 1998 and 1997
INDEX
Financial Statements:
Balance Sheets 3
Statements of Operations 4
Statements of Cash Flows 5
Notes to Financial Statements 6
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HICKORY HILLS, LTD.
(A Limited Partnership)
BALANCE SHEETS
(Unaudited)
September 30, December 31,
1998 1997
--------- ----------
ASSETS
CASH $108,888 $ 180,308
RESTRICTED CASH 173,147 167,859
LAND & IMPROVEMENTS HELD
FOR INVESTMENT 1,710,688 2,071,767
OTHER ASSETS 280 280
Total Assets $1,993,003 $ 2,420,214
========== ==========
LIABILITIES AND PARTNERS' DEFICIT
Accrued Interest Payable $ 718,806 $ 831,855
Note Payable to Affiliate 3,454,300 3,454,300
Other Accrued Expenses 103,510 110,122
TOTAL LIABILITIES 4,276,616 4,396,277
Partners' Deficit:
Limited Partners (1,800 units
outstanding (2,283,713) (1,976,163)
General Partner 100 100
Total Partners' deficit (2,283,613) (1,976,063)
Total Liabilities &
Partners' Deficit $1,993,003 $2,420,214
========== ===========
<FN>
See notes to financial statements.
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HICKORY HILLS, LTD.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Quarter Ending Year to Date
Ending September 30,
1998 1997 1998 1997
------- ------- ------- -------
REVENUE:
Land Sales
Sales of Land
& Improvements $ - $ - $432,650 $436,000
Cost of Land &
Improvements Sold - - (399,049) (280,376)
Closing Costs - - (43,900) (28,877)
Gain(Loss) on
Sale of Land - - (10,299) 126,747
Interest Income 2,413 600 9,298 9,231
Misc. Income 5,332 - 5,332 -
Total Revenue 7,745 600 4,331 135,978
EXPENSES:
Management Fees 750 750 2,250 2,250
Legal &
Accounting Fees 400 - 12,393 12,270
General & Admin.
Expenses 7,656 443 12,965 4,101
Maintenance Fees - 4,982 22,322 23,998
Interest Expense 87,317 87,317 261,951 261,951
Total Expenses 96,123 93,492 311,881 304,570
NET LOSS $(88,378) $(92,892) $(307,550)$(168,592)
<FN>
See notes to financial statements
/TABLE
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HICKORY HILLS, LTD.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Year-to-date
SEPTEMBER 30,
--------------
1998 1997
Cash Flows from
Operating Activities:
Net Loss $(307,550) $(168,592)
Adjustments to reconcile
Net Loss to Net Cash used
in Operating Activities:
(Increase) decrease
in Restricted Cash (5,288) 95,163
Cost of Land
& Improvements Sold 399,049 280,376
Cost of Land & Improvements
held for Investment (37,970) (163,099)
Decrease in Accrued
Interest Payable (113,049) (83,049)
Decrease in other Accrued
Expenses (6,612) (29,237)
Net Cash used in
Operating Activities (71,420) (68,438)
Net Decrease in Cash (71,420) (68,438)
CASH AT JANUARY 1, 180,308 142,345
CASH AT SEPTEMBER 30, $ 108,888 $ 73,907
======== ========
Supplemental Disclosures of
Cash Flow Information:
Cash paid during the year for
interest $ 375,000 $ 345,000
========= =========
<FN>
See notes to financial statements.
/TABLE
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HICKORY HILLS, LTD.
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 1998 and 1997
(Unaudited)
A.ACCOUNTING POLICIES
The unaudited financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q and
do not include all of the information and note disclosures
required by generally accepted accounting principles. These
statements should be read in conjunction with the financial
statements and notes thereto included in the Partnership's Form
10-K for the year ended December 31, 1997. In the opinion of
management, such financial statements include all adjustments,
consisting only of normal recurring adjustments, necessary to
summarize fairly the Partnership's financial position and
results of operations. The results of operations for the nine
month period ended September 30, 1998 may not be indicative of
the results that may be expected for the year ending December
31, 1998.
B.RELATED PARTY TRANSACTIONS
The General Partner and its affiliates have been actively
involved in managing the Partnership's operations. Compensation
earned for these services in the first nine months were as
follows:
1998 1997
Management Fees $ 2,250 $ 2,250
Real Estate Brokerage
Commission $ 16,556 $ 13,080
Accounting Fees $ 1,700 $ 1,600
C. COMPREHENSIVE INCOME
Effective January 1, 1998, the Partnership adopted Statement of
Financial Accounting Standards (SFAS) No. 130. Reporting
Comprehensive Income, SFAS No. 130 established standards for
reporting and display of comprehensive income and its components in
a full set of general-purpose financial statements and requires
that all components of comprehensive income be reported in a
financial statement that is displayed with the same prominence as
other financial statements. Comprehensive income is defined as the
change in equity of a business enterprise, during a period,
associated with transactions and other events and circumstances
from non-owner sources. It includes all changes in equity during
a period except those resulting from investments by owners and
distributions to owners. During the three and nine month periods,
ended September 30, 1998 and 1997, the Partnership had no
components of comprehensive income. Accordingly, comprehensive
income for each of the periods was the same as net loss.
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Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
During 1998, the Registrant sold one lakefront lot at the
Hendersonville Property for $75,000 and 71.53 acres of the
Nashville Property for gross proceeds of $357,650. From these
sales proceeds, $375,000 in accrued interest was paid to the
Lender. The remaining proceeds were retained to cover operating
expenses. Overall operations of the Registrant are comparable to
prior quarters, except for the increase in general administration
which includes certain architect and engineering fees. Since
development of the Hendersonville Property is complete no
additional significant architect and engineering fees are expected
in the future.
During the first nine months of 1997, the Registrant sold 16 lots
at the Hendersonville Property for $23,500 per lot and one lake
front lot for $60,000.
The General Partner has evaluated the impact of year 2000 issues on
our computer systems and applications. The Registrant is affected
by a single personal computer and a commercial software package.
Both are Y2K compliant.
LIQUIDITY
As of October 31, 1998 the Registrant had approximately $40,447 in
cash reserves. These funds are expected to be sufficient through
1998.
The Note payable to Affiliate comes due on December 31, 1998. The
General Partner plans to negotiate an extension of the loan term.
The General Partner does not expect the Registrant to have the
liquidity to retire the debt in full on December 31, 1998. Because
the Registrant and the Lender share the same general partner, it
may be necessary to appoint an independent party to represent the
General Partner for the Registrant, the Lender or both during the
loan negotiations. However, if the loan term is not extended, the
lack of payment would constitute a default on the loan agreement.
In such an event the Lender is required to foreclose the loan.
Currently, the Lender has not foreclosed or accelerated the amounts
due under the loan agreement.
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PART II. OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(b) No 8-K's have been filed during this quarter.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly
authorized.
HICKORY HILLS, LTD.
By: 222 HICKORY, LTD.
General Partner
By: 222 PARTNERS, INC.
General Partner
Date: November 16, 1998 By:/s/ Steven D. Ezell
President
Date: November 16, 1998 By:/s/ Michael A. Hartley
Secretary/Treasurer