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: September 30, 1997
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 000-16757
CONCORD MILESTONE PLUS, L.P.
(Exact Name of Registrant as Specified in its Charter)
Delaware 52-1494615
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
5200 TOWN CENTER CIRCLE
4TH FLOOR
BOCA RATON, FLORIDA 33486
(Address of Principal Executive Offices) (Zip Code)
(561) 394-9260
Registrant's Telephone Number, Including Area Code
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report
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 for the
past 90 days. Yes X No
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
CONCORD MILESTONE PLUS, L.P.
(a Limited Partnership)
BALANCE SHEETS
SEPTEMBER 30, 1997 (Unaudited) AND DECEMBER 31, 1996
ASSETS
September 30, 1997 December 31, 1996
Property, at cost
Building and improvements .............................................. $ 15,450,083 $ 15,359,462
Less: accumulated depreciation ......................................... 5,265,418 4,829,534
------------ ------------
Building and improvements, net ......................................... 10,184,665 10,529,928
Land ................................................................... 10,987,034 10,987,034
------------ ------------
Total property ......................................................... 21,171,699 21,516,962
Cash and cash equivalents ................................................. 94,894 326,120
Accounts receivable ....................................................... 171,524 200,975
Funds held in escrow ...................................................... 401,835 0
Prepaid expenses .......................................................... 35,794 22,864
Other assets, net ......................................................... 62,813 16,957
Debt financing costs ...................................................... 309,676 2,897
------------ ------------
Total assets ........................................................ $ 22,248,235 $ 22,086,775
============ ============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Mortgage Loans Payable .................................................... $ 16,710,000 $ 0
Bonds payable, net ........................................................ 0 16,473,060
Accrued interest .......................................................... 0 137,100
Accrued expenses and other liabilities .................................... 556,979 255,137
Due to affiliates ......................................................... 80,000 11,985
------------ ------------
Total liabilities ...................................................... 17,346,979 16,877,282
------------ ------------
Commitments and Contingencies
Partners' capital:
General partner ........................................................ (73,552) (70,470)
Limited partners:
Class A Interests, 1,518,800 ........................................... 4,974,808 5,279,963
------------ ------------
Total partners' capital ................................................ 4,901,256 5,209,493
------------ ------------
Total liabilities and partners' capital ................................ $ 22,248,235 $ 22,086,775
============ ============
See Accompanying Notes to Financial Statements
-2-
CONCORD MILESTONE PLUS, L.P.
(a Limited Partnership)
STATEMENTS OF REVENUES AND EXPENSES
(Unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
September 30, 1997 September 30, 1996
Revenues:
Rent ...................................................................... $ 661,118 $ 638,576
Reimbursed expenses ....................................................... 129,401 108,420
Interest and other income ................................................. 7,835 4,966
--------------- ---------------
Total revenues ......................................................... 798,354 751,962
--------------- ---------------
Expenses:
Interest expense .......................................................... 430,341 390,735
Depreciation and amortization ............................................. 141,063 160,996
Management and property expenses .......................................... 221,148 197,191
Administrative and management fees to related party ....................... 28,195 25,810
Professional fees and other expenses ...................................... 29,035 28,152
--------------- ---------------
Total expenses ......................................................... 849,782 802,884
--------------- ---------------
Net loss .................................................................. $ (51,428) $ (50,922)
=============== ===============
Net loss attributable to:
Limited partners ....................................................... $ (50,914) $ (50,413)
General partner ........................................................ (514) (509)
--------------- ---------------
Net loss .................................................................. $ (51,428) $ (50,922)
=============== ===============
Loss per weighted average
Limited Partnership 100 Class A
Interests outstanding ..................................................... $ (3.38) $ (3.35)
=============== ===============
Weighted average number of 100
Class A interests outstanding ............................................. 15,188 15,188
=============== ===============
See Accompanying Notes to Financial Statements
-3-
CONCORD MILESTONE PLUS, L.P.
(a Limited Partnership)
STATEMENTS OF REVENUES AND EXPENSES
(Unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
September 30,1997 September 30, 1996
Revenues:
Rent ........................................................................... $ 1,930,091 $ 1,958,228
Reimbursed expenses ............................................................ 368,632 303,868
Interest and other income ...................................................... 23,307 13,337
--------------- ---------------
Total revenues .............................................................. 2,322,030 2,275,433
--------------- ---------------
Expenses:
Interest expense ............................................................... 1,252,941 1,172,205
Depreciation and amortization .................................................. 426,113 479,898
Management and property expenses ............................................... 598,139 604,887
Administrative and management fees to related party ............................ 81,697 80,369
Professional fees and other expenses ........................................... 169,637 99,467
--------------- ---------------
Total expenses .............................................................. 2,528,527 2,436,826
--------------- ---------------
Net loss ....................................................................... $ (206,497) $ (161,393)
=============== ===============
Net loss attributable to:
Limited partners ............................................................ $ (204,432) $ (159,779)
General partner ............................................................. (2,065) (1,614)
--------------- ---------------
Net loss ....................................................................... $ (206,497) $ (161,393)
=============== ===============
Loss per weighted average
Limited Partnership 100 Class A
Interests outstanding .......................................................... $ (13.60) $ (10.63)
=============== ===============
Weighted average number of 100
Class A interests outstanding .................................................. 15,188 15,188
=============== ===============
See Accompanying Notes to Financial Statements
-4-
CONCORD MILESTONE PLUS, L.P.
(a Limited Partnership)
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
General Class A
Total Partner Interests
PARTNERS' CAPITAL (DEFICIT)
January 1, 1997 ...... $ 5,209,493 $ (70,470) $ 5,279,963
Distributions ............. (101,740) (1,017) (100,723)
Net Loss .................. (206,497) (2,065) (204,432)
--------------- --------------- ---------------
PARTNERS' CAPITAL (DEFICIT)
September 30, 1997 ... $ 4,901,256 $ (73,552) $ 4,974,808
=============== =============== ===============
See Accompanying Notes to Financial Statements
-5-
CONCORD MILESTONE PLUS, L.P.
(a Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
September 30,1997 September 30, 1996
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ......................................... $ (206,497) $ (161,393)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization ................. 426,113 479,898
Change in operating assets and liabilities:
Decrease (increase) in accounts receivable 29,451 (15,395)
Increase in prepaid expenses .............. (12,930) (16,872)
(Increase) decrease in other assets, net .. (55,696) 42,753
(Decrease) increase in accrued interest ... (137,100) 390,735
Increase (decrease) in accrued expenses and
other liabilities .................... 301,842 (17,345)
Increase in due to affiliate .............. 68,015 22,240
--------------- ---------------
Net cash provided by operating activities ........ 413,198 724,621
--------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITY:
Property improvements ......................... (90,621) (88,353)
--------------- ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Redemption on bonds payable ................... (16,452,000) 0
Funds held in escrow .......................... (401,835) 0
Debt financing costs .......................... (308,228) 2,897
Proceeds from mortgages payable ............... 16,710,000 0
Cash distributions to partners ................ (101,740) (146,328)
--------------- ---------------
Net cash used in financing activities ......... (553,803) (143,431)
--------------- ---------------
NET (DECREASE) INCREASE IN CASH AND
CASH EQUIVALENTS .............................. (231,226) 492,837
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD ........................... 326,120 218,872
--------------- ---------------
CASH AND CASH EQUIVALENTS,
END OF PERIOD ................................. $ 94,894 $ 711,709
=============== ===============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid during the period for interest ......... $ 1,386,252 $ 781,470
=============== ===============
See Accompanying Notes to Financial Statements
-6-
CONCORD MILESTONE PLUS, L.P.
(a Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
The accompanying financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included. The
financial statements as of and for the period ended September 30, 1997 and 1996
are unaudited. The results of operations for the interim periods are not
necessarily indicative of the results of operations for the fiscal year. Certain
information for 1996 has been reclassified to conform to the 1997 presentation.
These financial statements should be read in conjunction with the financial
statements and footnotes included thereto in the Partnership's financial
statements filed on Form 10-K for the year ended December 31, 1996.
1. Refinancing of Bonds Payable
As of September 30, 1997, Concord Milestone Plus, L.P. (the
"Partnership"), with the assistance of Tri-Stone Mortgage Company, an affiliate
of the General Partner, closed three new fixed rate first mortgage loans (the
"Mortgage Loans") from Westco Real Estate Finance Corp. (the "Lender") in the
amounts of $2,865,000, $8,445,000 and $5,400,000, respectively. All three
Mortgage Loans are secured by first mortgages on the Partnership's shopping
centers located in Searcy, Arkansas, Valencia, California and Green Valley,
Arizona (collectively, the "Properties"). Prior to September 30, 1997, the
Properties were encumbered by mortgages granted by the Partnership to United
States Trust Company of New York, as trustee for the benefit of the holders of
the Partnership's Escalating Rate Collateralized Mortgage Bonds due November 30,
1997 (the "Bonds"). The Partnership used the proceeds of the Mortgage Loans and
available cash to redeem all of the outstanding Bonds. An aggregate of
$17,015,650 was paid to the holders of the Bonds in connection with such
redemption, of which $16,452,000 was applied to prepay the principal of the
Bonds and $563,650 was applied to pay interest accrued on the Bonds through the
redemption date.
-7-
The Mortgage Loan obtained by the Partnership with respect to the Property
located in Searcy, Arkansas (the "Searcy Loan") is in the principal amount of
$2,865,000 and bears interest at a fixed rate of 8.125% per annum. The Searcy
Loan requires monthly payments of principal and interest of $21,640 through and
including September 1, 2007. On October 1, 2007, the balance of principal and
interest (estimated to be $2,505,981) will be due and payable. The Searcy Loan
may not be prepaid in whole or in part prior to November 1, 2003. Subsequent to
October 31, 2003 and prior to May 31, 2007 it may be prepaid in whole but not in
part on any payment date with a prepayment penalty equal to the greater of (i)
1% of the outstanding principal balance at such time, or (ii) the excess, if
any, of the present value of the remaining scheduled principal and interest
payments (including any balloon payment), discounted at the Discount Rate (as
defined below), over the amount of principal being prepaid. The Searcy Loan may
be prepaid without penalty on any payment date after May 31, 2007. The Discount
Rate is a rate determined as of the week ending prior to the prepayment date and
is based on the published rates of U.S. Government securities having maturities
approximating the maturity date of the Searcy Loan. The Searcy Loan is secured
by first mortgages on all three of the Partnership's Properties and a default
under either of the other two Mortgage Loans will constitute a default under the
Searcy Loan. The Mortgage on the Partnership's shopping center located in
Searcy, Arkansas may be released at the Partnership's option after the Searcy
Loan is fully paid provided that no event of default exists under any of the
Mortgage Loans, the mortgagee has not given the Partnership notice of any event
which, with the passage of time, would constitute an event of default, and
certain other conditions are satisfied.
The Mortgage Loan obtained by the Partnership on the Property located in
Valencia, California (the "Valencia Loan") is in the principal amount of
$8,455,000 and bears interest at a fixed rate of 8.125% per annum. The Valencia
Loan requires monthly payments of principal and interest of $65,881 through and
including September 1, 2007. On October 1, 2007, the balance of principal and
interest (estimated to be $7,003,227) will be due and payable. The Valencia Loan
may not be prepaid in whole or in part prior to November 1, 2003. Subsequent to
October 31, 2003 and prior to May 31, 2007 it may be prepaid in whole but not in
part on any payment date with a prepayment penalty equal to the greater of (i)
1% of the outstanding principal balance at such time, or (ii) the excess, if
any, of the present value of the remaining scheduled principal and interest
payments (including any balloon payment), discounted at the Discount Rate (as
defined below), over the amount of principal being prepaid. The Valencia Loan
may be prepaid without penalty on any payment date after May 31, 2007. The
Discount Rate is a rate determined as of the week ending prior to the prepayment
date and is based on the published rates of U.S. Government securities having
maturities approximating the maturity date of the Valencia Loan. The Valencia
Loan is secured by first mortgages on all three of the Partnership's Properties
and a default under either of the other two Mortgage Loans will constitute a
default under the Valencia Loan.
-8-
The Mortgage on the Partnership's shopping center located in Valencia,
California may be released at the Partnership's option after the Valencia Loan
is fully paid provided that no event of default exists under any of the Mortgage
Loans, the mortgagee has not given the Partnership notice of any event which,
with the passage of time, would constitute an event of default, and certain
other conditions are satisfied. In connection with the Valencia Loan, the
Partnership has deposited $45,000 into an escrow account (the "Valencia Escrow
Account") with Lender. The funds held in the Valencia Escrow Account may be
released upon the satisfactory completion of certain environmental improvements
to the Property located in Valencia, California and the satisfaction of certain
other conditions.
The Mortgage Loan obtained by the Partnership on the Property located in
Green Valley, Arizona (the "Green Valley Loan") is in the principal amount of
$5,400,000 and bears interest at a fixed rate of 8.250% per annum. The Green
Valley Loan requires monthly payments of principal and interest of $41,252
through and including September 1, 2007. On October 1, 2007, the balance of
principal and interest (estimated to be $4,738,096) will be due and payable. The
Green Valley Loan may not be prepaid in whole or in part prior to November 1,
2003. Subsequent to October 31, 2003 and prior to May 31, 2007 it may be prepaid
in whole but not in part on any payment date with a prepayment penalty equal to
the greater of (i) 1% of the outstanding principal balance at such time, or (ii)
the excess, if any, of the present value of the remaining scheduled principal
and interest payments (including any balloon payment), discounted at the
Discount Rate (as defined below), over the amount of principal being prepaid.
The Green Valley Loan may be prepaid without penalty on any payment date after
May 31, 2007. The Discount Rate is a rate determined as of the week ending prior
to the prepayment date and is based on the published rates of U.S. Government
securities having maturities approximating the maturity date of the Green Valley
Loan. The Green Valley Loan is secured by first mortgages on all three of the
Partnership's Properties and a default under either of the other two Mortgage
Loans will constitute a default under the Green Valley Loan. The Mortgage on the
Partnership's shopping center located in Green Valley, Arizona may be released
at the Partnership's option after the Green Valley Loan is fully paid provided
that no event of default exists under any of the Mortgage Loans, the mortgagee
has not given the Partnership notice of any event which, with the passage of
time, would constitute an event of default, and certain other conditions are
satisfied. In connection with the Green Valley Loan, the Partnership has
deposited $150,000 into an escrow account (the "Green Valley Escrow Account")
with Lender. The funds held in the Green Valley Escrow Account may be released
upon the execution of a new lease or renewal lease, with a termination date of
July 31, 2004 or later, by a specified tenant of the Property located in Green
Valley, Arizona and the satisfaction of certain other conditions.
CM Plus Corporation, the general partner of the Partnership, guaranteed
the Partnership's obligations under the Mortgage Loans.
-9-
As a result of the Mortgage Loans, the Partnership recorded an aggregate
mortgage payable of $16,710,000 at September 30, 1997. In addition, the Lender
required a deposit of $198,000 into an escrow account for payment of real estate
taxes. The Mortgage Loans will require annual scheduled debt service payments
aggregating $1,545,276 through September 1, 2007. On October 1, 2007, all three
Mortgage Loans will become due and will require a payment currently estimated at
$14,247,304.
2. Commitments and Contingencies
The Lender engaged an independent environmental and geotechnical
consulting firm to perform environmental due diligence on the Properties at the
Partnership's expense. After various tests, the consultant identified chemical
contamination in the soil at a site at the Old Orchard Shopping Center in
Valencia, California which it believes is attributable to improper handling of
dry cleaning solvent by a tenant and its predecessors. Based on the results of
soil sampling and testing and the condition of the site, the environmental
consultant has concluded that the contaminated area is an excellent candidate
for receipt of regulatory closure of environmental issues through the use of a
health-risk assessment process which, if accepted by the California
Environmental Protection Agency, would obviate the need for active remediation
by the Partnership. Currently, the consultant has submitted a plan for a
"risk-based closure" for the site which will require a minimum of three to four
months to complete and is estimated to cost between $28,000 and $100,000,
assuming that the Partnership receives regulatory agency acceptance of the plan.
Based on the aforementioned, the Partnership believes it has made adequate
provision in the accompanying financial statements to cover its costs associated
with the environmental condition at the property.
The Partnership currently is pursuing the course of action recommended by
the environmental consultant. There can be no assurance, however, that the
Partnership will be granted a health-risk-based-closure and will not be
responsible for active remediation of the affected site, the cost of which
cannot be estimated at this time, but which could be substantial.
3. Recently Issued Accounting Pronouncements
The Financial Accounting Standards Board has recently issued several new
accounting pronouncements. Statement No. 128, "Earnings per Share" establishes
standards for computing and presenting earnings per share, and is effective for
financial statements for both interim and annual periods ending after December
15, 1997. Statement No. 129, "Disclosure of Information about Capital Structure"
establishes standards for disclosing information about an entity's capital
structure, and is effective for financial statements for periods ending after
December 15, 1997. Statement No. 130, "Reporting Comprehensive
-10-
Income" establishes standards for reporting and display of comprehensive income
and its components, and is effective for fiscal years beginning after December
15, 1997. Statement No. 131 "Disclosures about Segments of an Enterprise and
Related Information" establishes standards for the way that public business
enterprises report information about operating segments in annual financial
statements and requires that those enterprises report selected information about
operating segments in interim financial reports issued to partners. It also
establishes standards for related disclosures about products and services,
geographic areas, and major customers, and is effective for financial statements
for periods beginning after December 15, 1997.
Management of the Partnership does not believe that these new standards
will have a material effect on the Partnership's reported operating results, per
partnership interest amounts, financial position or cash flows.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
General
Certain statements made in this report may constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 (the "Reform Act"). Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include, among others, the
following: general economic and business conditions, which will, among other
things, affect demand for retail space or retail goods, availability and
creditworthiness of prospective tenants, lease rents and the terms and
availability of financing; adverse changes in the real estate markets including,
among other things, competition with other companies and technology; risks of
real estate development and acquisition; governmental actions and initiatives
;and environmental/safety requirements.
Organization and Capitalization
Concord Milestone Plus, L.P., a Delaware limited partnership (the
"Partnership"), was formed on December 12, 1986, for the purpose of investing in
existing income-producing commercial and industrial real estate. The Partnership
began operations on August 20, 1987, and currently owns and operates three
shopping centers located in Searcy, Arkansas; Valencia, California; and Green
Valley, Arizona.
-11-
The Partnership commenced a public offering on April 8, 1987 in order to
fund the Partnership's real property acquisitions. The Partnership terminated
its public offering on April 2, 1988 and was fully subscribed to with a total of
16,452 Bond Units and 15,188 Equity Units issued. Each Bond Unit consisted of
$1,000 principal amount of Bonds and 36 Class B Interests. Each Equity Unit
consists of 100 Class A Interests and 100 Class B Interests. Capital
contributions to the Partnership consisted of $15,187,840 from the sale of the
Equity Units and $592,272 from the sale of the Bond Units.
Results of Operations
Comparison of Quarter Ended September 30, 1997 to Quarter Ended
September 30, 1996
Revenues of the Partnership increased $46,392, or 6.2%, to $798,354 for
the quarter ended September 30, 1997 as compared to $751,962 for the quarter
ended September 30, 1996, primarily due to an increase in reimbursed expenses.
Reimbursed expenses increased due to increased recovery percentages on both
common area expenses and real estate taxes. Additionally, refunds given to
tenants in 1996 due to an incorrect billing in a prior year were charged to
revenue in 1996.
Management and property expenses increased $23,957, or 12.1%, to $221,957
for the quarter ended September 30, 1997 as compared to $197,191 for the quarter
ended September 30, 1996, primarily due to an increase in real estate taxes at
the Green Valley Mall located in Green Valley, Arizona resulting from
county-level increases in both assessed values and tax rates which occurred
during 1997.
Interest expense increased $39,606, or 10.1%, to $430,341 for the quarter
ended September 30, 1997 as compared to $390,735 for the quarter ended September
30, 1996, due to the increase in the interest rate on the Partnership's Bonds
from 9.50% in 1996 to 10.0% in 1997.
Depreciation and amortization expense decreased $19,933, or 12.4%, to
$141,063 for the quarter ended September 30, 1997 as compared to $160,996 for
the quarter ended September 30,1996, due to a decrease in the amortization of
the net bond premium/discount in 1997.
-12-
Comparison of Nine Months Ended September 30,1997 to Nine Months Ended
September 30, 1996
Revenues of the Partnership increased $46,597, or 2.0%, to $2,322,030 for
the nine months ended September 30, 1997, as compared to $2,275,433 for the nine
months ended September 30, 1996, primarily due to an increase in reimbursed
expenses. Reimbursed expenses increased due to increased recovery percentages on
both common area expenses and real estate taxes. Additionally, refunds given to
tenants in 1996 due to an incorrect billing in a prior year were charged to
revenue in 1996.
Interest expense increased $80,736, or 6.9%, to $1,252,941 for the nine
months ended September 30, 1997, as compared to $1,172,205 for the nine months
ended September 30, 1996 due to the increase in the interest rate on the
Partnership's Bonds from 9.5% in 1996 to 10.0% in 1997.
Depreciation and amortization expense decreased $53,785, or 11.2%, to
$426,113 for the nine months ended September 30, 1997 as compared to $479,898
for the nine months ended September 30, 1996, due to a decrease in the
amortization of the net bond premium/ discount in 1997.
Professional fees and other expenses increased $70,170, or 70.5% to
$169,637 for the nine months ended September 30, 1997 as compared to $99,467 for
the nine months ended September 30, 1996, primarily due to an accrual of
estimated environmental and geotechnical costs for risk-based closure at the Old
Orchard Shopping Center, in Valencia, California.
Liquidity and Capital Resources
The General Partner believes that the Partnership's working capital is
sufficient to meet the Partnership's current operating requirements for the
remainder of the year. Nevertheless, because the cash revenues and expenses of
the Partnership will depend on future facts and circumstances relating to the
Partnership's properties, as well as market and other conditions beyond the
control of the Partnership, a possibility exists that cash flow deficiencies may
occur. Currently, a significant amount of the Partnership's working capital is
in the control of the lender as funds held in escrow pending resolution of
certain circumstances. There are currently no material commitments for capital
expenditures.
-13-
The Partnership has suspended making distributions due to the cost of
addressing environmental issues identified at the Old Orchard Shopping Center in
Valencia, California and payment of certain expenses relative to the refinancing
which are still outstanding. However, future debt service payments on the
mortgage loans will be approximately $100,000 lower per year than the annualized
1997 scheduled payments on the redeemed Bonds. Also, an additional savings of
approximately $25,000 per year will be realized because the Partnership will no
longer be required to pay trustee fees on the Bonds. Resolution of the
environmental situation affecting the Old Orchard Shopping Center is expected
during the first quarter of 1998. The Partnership will continue to suspend
distributions pending the resolution of the environmental condition.
Management is not aware of any other trends, events, commitments or
uncertainties that will or are likely to materially impact the Partnership's
liquidity.
Cash Flows
Net cash provided by operating activities of $413,198 for the nine months
ended September 30, 1997 included (i) a net loss of $206,497, (ii) non-cash
adjustments of $426,113 for depreciation and amortization expense and (iii) a
net change in operating assets and liabilities of $193,582.
Net cash provided by operating activities of $724,621 for the nine months
ended September 30, 1996 included (i) a net loss of $161,393, (ii) non-cash
adjustments of $479,898 for depreciation and amortization expense and (iii) a
net change in operating assets and liabilities of $406,116.
Net cash used in investing activities of $90,621 and $88,353 for the nine
months ended September 30, 1997 and September 30, 1996, respectively, consisted
of capital expenditures for property improvements.
Net cash used in financing activities of $553,803 for the nine months
ended September 30, 1997 included (i) redemption of Bonds payable of
$16,452,000, (ii) funds held in escrow of $401,835, (iii) debt financing costs
of $308,228, (iv) proceeds from mortgages payable of $16,710,000 and (v) cash
distributions to partners of $101,740.
Net cash used in financing activities of $143,431 for the nine months
ended September 30, 1996 included (i) debt financing costs of $2,897 and (ii)
cash distributions to partners of $146,328.
-14-
PART II - OTHER INFORMATION
Item 6. Reports on Form 8-K
(a) The following exhibits are included herein:
Number Exhibit
3.1 Amended and Restated Agreement of Limited Partnership of
Concord Milestone Plus, L.P. incorporated herein by
reference to Exhibit A to the Registrant's Prospectus
included as Part I of the Registrant's Post-Effective
Amendment No. 3 to the Registrant's Registration
Statement on Form S-11 which declared effective on April
3, 1987.
3.2 Amendment No. 1 to Amended and Restated Agreement of
Limited Partnership of Concord Milestone Plus, L.P.,
included as Exhibit 3.2 to Registrant's Form 10-K for
the fiscal year ended December 31, 1987 ("1987 Form
10-K"), which is incorporated herein by reference.
3.3 Amendment No. 2 to Amended and Restated Agreement of Limited
Partnership of Concord Milestone Plus, L.P. included as Exhibit 3.3 to
the 1987 Form 10-K, which is incorporated herein by reference. 3.4
Amendment No. 3 to Amended and Restated Agreement of Limited
Partnership of Concord Milestone Plus, L.P. included as Exhibit 3.4 to
the 1987 Form 10-K, which is incorporated herein by reference.
3.5 Amendment No. 4 to Amended and Restated Agreement of Limited
Partnership of Concord Milestone Plus, L.P. included as Exhibit 3.5 to
the 1987 Form 10-K, which is incorporated herein by reference.
3.6 Amendment No. 5 to Amended and Restated Agreement of Limited
Partnership of Concord Milestone Plus, L.P. included as Exhibit 3.6 to
Registrant's Form 10-K for the fiscal year ended December 31, 1988
which is incorporated herein by reference.
10.1 Fixed Rate Note, dated September 23, 1997, executed by
the Partnership in favor of Lender, relating to the
property located in Green Valley, Arizona.
-15-
Number Exhibit
10.2 Mortgage, Deed of Trust, Assignment of Leases and Rents,
Security Agreement and Fixture Filing, dated September
23, 1997, executed by the Partnership for the benefit of
Lender, relating to the property located in Green
Valley, Arizona.
10.3 Assignment of Leases and Rents, dated September 23,
1997, executed by the Partnership for the benefit of
Lender, relating to the property located in Green
Valley, Arizona.
10.4 Environmental Liabilities Agreement, dated September 23,
1997, executed by the Partnership and CM Plus
Corporation for the benefit of Lender, relating to the
property located in Green Valley, Arizona.
10.5 Tenant Occupancy Escrow and Security Agreement, dated
September 23, 1997, by and between the Partnership and
the Lender, relating to the property located in Green
Valley, Arizona.
10.6 Fixed Rate Note, dated September 23, 1997, executed by
the Partnership in favor of Lender, relating to the
property located in Searcy, Arkansas.
10.7 Mortgage, Deed of Trust and Security Agreement, dated
September 23, 1997, executed by the Partnership for the
benefit of Lender, relating to the property located in
Searcy, Arkansas.
10.8 Assignment of Leases and Rents, dated September 23,
1997, executed by the Partnership for the benefit of
Lender, relating to the property located in Searcy,
Arkansas.
10.9 Environmental Liabilities Agreement, dated September 23,
1997, executed by the Partnership and CM Plus
Corporation for the benefit of Lender, relating to the
property located in Searcy, Arkansas.
10.10 Fixed Rate Note, dated September 23, 1997, executed by
the Partnership in favor of Lender, relating to the
property located in Valencia, California.
10.11 Deed of Trust, Assignment of Leases and Rents, Security
Agreement and Fixture Filing, dated September 23, 1997,
executed by the Partnership for the benefit of Lender,
relating to the property located in Valencia,
California.
-16-
Number Exhibit
10.12 Assignment of Leases and Rents, dated September 23,
1997, executed by the Partnership for the benefit of
Lender, relating to the property located in Valencia,
California.
10.13 Environmental Liabilities Agreement, dated September 23,
1997, executed by the Partnership and CM Plus
Corporation for the benefit of Lender, relating to the
property located in Valencia, California.
10.14 Environmental Escrow and Security Agreement, dated
September 23, 1997, by and between the Partnership and
the Lender, relating to the property located in
Valencia, California.
27. Financial Data Schedule Article 5 included for
Electronic Data Gathering, Analysis, and Retrieval
(EDGAR) purposes only. This Schedule contains summary
financial information extracted from the balance
sheets and statements of revenues and expenses of the
Partnership as of and for the nine month
period ended September 30, 1997, and is qualified in its
entirety by reference to such financial statements.
(b) No reports on form 8-K were filed during the quarter for which this
report is being filed.
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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.
DATE: November 8, 1996 CONCORD MILESTONE PLUS, L.P.
-------------------------- ----------------------------
(Registrant)
BY: CM PLUS CORPORATION
General Partner
By: /S/ Robert Mandor
Robert Mandor
Director and Vice President
By: /S/ Patrick S Kirse
Patrick S Kirse
Treasurer and Controller