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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended Commission File No.
June 30, 2003 0-12895
ALL-STATE PROPERTIES L.P.
(Exact name of Registrant as specified in its charter)
Delaware 59-2399204
(State or other jurisdiction or (I.R.S. Employer
incorporation or organization) Identification No.)
Mailing address: P.O. Box 5524
Fort Lauderdale, FL 33310-5524
5500 N.W. 69th Avenue, Lauderhill, Florida 33319
(Address of principal executive offices) (Zip Code)
Registrant?s Telephone number, including area code (954) 572-2113
Securities registered pursuant to Section 12(b) of the Act:
Title of Class Name of Each Exchange on Which Registered
None Not Applicable
Securities registered pursuant to Section 12(g) of the Act:
Title of Class
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 issuer was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
YES X NO
The aggregate market value of the limited partnership units held by non-
affiliates of Registrant is not ascertainable. (See Page II-1)
ALL-STATE PROPERTIES L.P.
FORM 10-K ANNUAL REPORT
FOR THE YEAR ENDED JUNE 30, 2003
I N D E X
PART 1
PAGE
ITEM 1. Business I-3
ITEM 2. Properties I-6
ITEM 3. Legal Proceedings I-6
ITEM 4. Submission of Matters to a Vote of Security
Holders I-6
PART II
ITEM 5. Market for Registrant?s Common Equity II-1
ITEM 6. Selected Financial Data II-2/3
ITEM 7. Management?s Discussion and Analysis of
Financial Condition and Results of
Operations II-4
ITEM 7A Quantiative and Qualitative Disclosure
About Market Risk II-5
ITEM 8. Financial Statements and Supplementary Data II-6/38
ITEM 9. Change in a Disagreements with Accountants on
Accounting and Financial Disclosure III-1
PART III
Item 10. Directors and Executive Officers of the
Registrant III-1
ITEM 11. Executive Compensation III-1
ITEM 12. Security Ownership of Certain Beneficial
Owners and Management and Related Stockholder
Matters III-2
ITEM 13. Certain Relationships and Related Transactions III-2
ITEM 14. Controls and Procedures III-3
ITEM 15. Principal Accountant Fees and Services III-3
ITEM 16. Exhibits, Financial Statement Schedule and
Reports on Form 8-K IV-1/4
Signatures IV-5
Certifications IV-6/7
I-2
PART I
ITEM 1. BUSINESS
(a) General Development of Business
All-State Properties L.P. (a limited partnership) (the
Partnership) was organized under the Revised Uniform Limited Partnership
Act of Delaware on April 27, 1984 to conduct the business formerly
carried on by a predecessor corporation, All-State Properties, Inc. (the
Corporation). The terms Company and Registrant refer to the Partnership
or the Corporation or both of them as the context requires. Pursuant to
a Plan of Liquidation adopted by shareholders of the Corporation on
September 30, 1984, the Corporation transferred substantially all of its
assets to the Partnership, and the Corporation distributed such limited
partnership interests to its shareholders.
Registrant?s principal business has been land development
and the construction and sale of residential housing in Broward County,
Florida. However, it has substantially completed its land development
activities and the sale of residential housing. Its present activities
are:
(i) Through a 36.12% owned Florida limited liability
corporation, Tunicom LLC (?Tunicom?)(formerly known as Unicom
Partnership Ltd.),Registrant was engaged in the operation of an adult
rental apartment project which was sold in August 2002. (See Item
1(b)(1)(i)(a) and Note 2 and 8 to financial statements.)
(ii) Through Tunicom, Registrant was engaged in a
contract to sell its remaining five acres of commercial and residential
land. (See Item 1 (b)(l)(i)(a) and Notes 2 and 8 to financial
statements.)
(b)(1) NARRATIVE DESCRIPTION OF BUSINESS
(i) Adult Rental Apartment Project
On June 25, 1997, Tunicom signed a Letter of Intent with
CareMatrix Corporation (AMEX) to sell its 324-unit rental property which
Letter became effective July 18, 1997. Prior to that date Tunicom,
through its partners representing a majority interest in the partnership
(the Company abstaining) voted to approve the transaction. The documents
memorializing the transaction were executed on August 13, 1997 with an
effective date of July 1, 1997, but dependent upon the completion of due
diligence and the payment of $4,500,000 to Tunicom. On September 24,
1997, CareMatrix made the required payment and the initial phase of the
transaction was completed. Tunicom used the proceeds for transaction
costs ($325,000), partnership obligations ($1,400,000), and distributed
$2,650,000 to certain partners to partially repay funds they invested in
Tunicom.
I-3
The $4,500,000 payment made by CareMatrix to Tunicom
represented an option payment, in consideration for which CareMatrix was
granted the option to purchase the facility in three years on June 30,
2000. The purchase price was 8.75 times the net operating income before
depreciation for the year ended June 30, 2000, plus the then outstanding
mortgage balance and other adjustments, less the $4,500,000 option
payment.
In the interim, CareMatrix leased the facility, retaining
the sums of $518,700-the first year; $775,000-the second year; and
$875,000-the third year out of cash flow each year and after payment of
amounts due in connection with the facility's mortgage insured by the
U.S. Department of Housing and Urban Development ("HUD").
The HUD-approved management company, SRR Management Corp.,
managed the facility at a rate approved by HUD of 4% of collections.
Prior to the closing, the Optionee assigned its option to
acquire Forest Trace. On August 16, 2000, the transaction was
consummated and closed with F.C. Forest Trace L.L.C., the present owner.
The purchase price was $47,159,295, including the outstanding principal
balance plus accrued interest on the existing mortgage in the amount of
$26,720,254,which was satisfied at closing. After giving effect to
various adjustments, prorations and credits, including the deposit of
$4,500,000 previously accounted for, the seller received net proceeds of
$16,379,732. After payment of a brokerage commission in the amount of
$232,190 and bonuses in the amount of $200,000 to key employees of
Forest Trace, none of whom were employees of the Company, $15,000,000
was distributed to partners. The remaining balance of $947,542 was being
held subject to true-up on November 15, 2000 of net operating income
from the facility for the four months ending October 31, 2000. The
Company?s share of the $15,000,000 distribution was $4,665,012. (See
Item 7). Of the amount distributed to the Company, $769,038 was used to
pay liabilities and $2,638,324 was used to pay the Company?s outstanding
debentures together with accrued interest thereon. The balance in the
amount of $1,257,650 was retained by the Company, and together with its
share of the $947,542 being held, determined the amount of a
distribution to the unit owners of $.40 a unit on May 8, 2001.
Tunicom L.L.C. (?Tunicom?) sold the adult retirement
community known as Forest Trace and retained approximately five acres
for sale of a site for an assisted living facility. This represents
Tunicom?s sole remaining asset. After the sale of Forest Trace, Tunicom
negotiated with the buyer of Forest Trace for the sale of the five-acre
parcel at a purchase price of $1,000,000. When the buyer of Forest Trace
advised Tunicom that it had no interest in acquiring the five-acre
parcel, Tunicom sought an alternate purchaser.
I-4
Tunicom has now entered into an agreement of purchase and
sale to sell the property for a price of $1,700,000. Closing the
transaction at that price, however, is contingent upon seller obtaining
at its cost all governmental approvals required before a building permit
can be issued and the availability of financing acceptable to buyer.
Partners of Tunicom (with All-State Properties L.P. and its general
partner abstaining) representing a majority interest in Tunicom voted to
approve the transaction and the payment at closing of a fee in the
amount of $250,000, to All-State Properties L.P.?s general partner for
accomplishing the obtaining of all of the necessary approvals,
governmental and otherwise, required under the agreement of purchase and
sale and for assisting the buyer in securing the required financing. The
general partner of All-State Properties L.P. is the president of the
manager of Tunicom.
As a condition of the sale, the buyer has also insisted
that All-State Properties L.P.?s general partner agree to manage the
facility once built. There can be no assurance that the transaction
contemplated by the agreement of purchase and sale will close.
(ii) Registrant has no plans for any new products.
(iii) Registrant holds no patents, trademarks, etc.
(iv) No part of Registrant?s business is subject to
significant seasonal variation.
(v) Registrant?s only present source of working
capital is the cash distributions made to it by Tunicom.
(vi) No portion of Registrant?s business involved
government contracts.
(vii) Registrant incurs no research and development
expenses.
(viii) Registrant employs one part-time person.
(c) Tunicom had no foreign operations or export sales.
I-5
ITEM 2. PROPERTIES
None.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders of
Registrant during the fourth quarter of the fiscal year covered by this
report.
I-6
PART II
ITEM 5. MARKET FOR THE REGISTRANT?S COMMON EQUITY AND
RELATED SECURITY HOLDER MATTERS
(a) In June, 1988, Registrant advised its unit holders
that in order to avoid classification as a publicly traded limited
partnership under the Internal Revenue Code, it would facilitate the
transfer of units privately commencing July 1, 1988.
There were no trades made through the Registrant?s
matching service for the years ended June 30, 1993 through June 30,
2003. The Company has no knowledge of other transactions. Therefore, no
bid and asked prices could be ascertained.
(b) As of June 30 2003, there were 1,324 holders of
record of 3,117,424 limited partnership interests. In addition, 641
units have not been escheated to various states.
Pursuant to the Plan of Liquidation and Dissolution
of All-State Properties, Inc. and the Limited Partnership Agreement of
All-State Properties L.P. upon the dissolution of the Corporation,
stockholders automatically received one unit of partnership interest for
each share of stock held and became record holders of limited
partnership units. However, until the stockholders submitted their stock
certificates for exchange and had taken other necessary steps, they
would not become limited partners.
(c)(d) The Company never paid cash dividends on its common
stock while it was a corporation. The Partnership declared cash
distributions cumulatively totaling $0.85 per unit through August 31,
1989 and distributed $.40 per unit on May 8, 2001.
II-1
ALL-STATE PROPERTIES L.P
(A LIMITED PARTNERSHIP) (NOTE 1A)
SELECTED FINANCIAL DATA
AS OF AND FOR THE YEARS ENDED JUNE 30
SELECTED CASH FLOW AND
AND OPERATING STATEMENT
DATA 2 0 0 3 2 0 0 2 2 0 0 1 2 0 0 0 1 9 9 9
REVENUE:
Equity in net earnings
(Loss) of real estate
partnerships $ (10,082) $ (13,438) $ 6,872,555 $ 683 $ (23,295)
Other income 5,594 7,624 59,564 6,082 7,364
Total $ (4,488) $ (5,814) $ 6,932,119 $ 6,765 $ (15,931)
Income (Loss) before
Extraordinary Items $ (56,121) $ (85,154) $ 6,843,331 $ (174,197) $ (235,948)
Net Income (Loss) $ (56,121) $ (85,154) $ 6,843,331 $ (174,197) $ (235,948)
Per Share/Unit -
fully diluted:
Net income (Loss) be-
fore Extraordinary Items $ (0.02) $ (0.03) $ 2.19 $ (.05) $ (.08)
Net Income (Loss) $ (0.02) $ (0.03) $ 2.19 $ (.05) $ (.08)
SELECTED BALANCE SHEET DATA
Total Assets $ 307,148 $ 345,222 $ 658,146 $ 6,526 $ 21,635
Notes, mortgages and con-
struction loans $ 34,000 $ - $ - $ 612,077 $ 573,225
4% convertible debentures,
due 1989 including
accrued interest $ - $ - $ - $ 2,628,518 $ 2,563,433
Total $ 34,000 $ - $ - $ 3,240,595 $ 3,136,658
Cash Dividends Declared
Per Share/Unit $ NONE $ NONE $ 0.40 $ NONE $ NONE
See notes to financial statements.
II-2
CITY PLANNED COMMUNITIES, (A PARTNERSHIP) AND TUNICOM
PARTNERSHIP LTD.
(A LIMITED PARTNERSHIP)
SELECTED FINANCIAL DATA
AS OF AND FOR THE YEARS ENDED JUNE 30
SELECTED INCOME STATEMENT DATA
2 0 0 3 2 0 0 2 2 0 0 1 2 0 0 0 1 9 9 9
Sales and rental
of real estate $ - $ - $ 21,705,571 $ - $ -
Lease Income - - - 5,744,412 5,352,291
Interest and other
income 778 1,356 2,226,737 13,832 18,818
Total Revenues $ 778 $ 1,356 $ 23,932,308 $ 5,758,244 $ 5,371,109
Net Income(Loss)
Before Extra-
ordinary Items $ 28,939 $ (39,927) $ 22,636,326 $ 419,267 $ 307,173
Net Income(Loss) $ 28,939 $ (39,927) $ 22,636,326 $ 419,267 $ 307,173
SELECTED BALANCE
SHEET DATA
Total Assets $ 855,276 $ 866,154 $ 763,142 $ 30,119,840 $ 30,597,154
Partners' Cash
Distributions $ - $ - $ 16,417,256 $ 848,936 $ 1,572,000
NOTE: Information shown is from the combined financial statements of City Planned Communities
(liquidated July 1, 2001) and Tunicom LLC.
See notes to combined financial statement.
II-3
ITEM 7. MANAGEMENT?S DISCUSSION AND ANALYSIS OF THE
FINANCIAL CONDITION AND RESULTS OF OPERATIONS -
ALL-STATE PROPERTIES L.P.
The following discussion and analysis of our financial condition and
results of operations should be read in conjunction with our financial
statements and notes thereto.
YEAR ENDED JUNE 30, 2003 COMPARED TO YEAR ENDED JUNE 30, 2002
The net income for the year ended June 30, 2003 as compared to the year
ended June 30, 2002 represents the results of operations due to the
administration of the Company and income from its investment in the real
estate partnership, Tunicom LLC.
YEAR ENDED JUNE 30, 2002 COMPARED TO YEAR ENDED JUNE 30, 2001
The net income for the year ended June 30, 2002 as compared to the year
ended June 30, 2001 represents the results of operations due to the
administration of the Company and income from its investment in the real
estate partnership, Tunicom LLC.
YEAR ENDED JUNE 30, 2001 COMPARED TO YEAR ENDED JUNE 30, 2000
The net income for the year ended June 30, 2001 as compared to the year
ended June 30, 2000 reflects the income from its investment in the real
estate partnership, Tunicom LLC that resulted from sale of assets as
described in Note 8 to the financial statements.
II-4
ITEM 7. MANAGEMENT?S DISCUSSION AND ANALAYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATION ?
TUNICOM LLC
The following discussion and analysis of our financial condition and
results of operations should be read in conjunction with our financial
statements and notes thereto.
YEAR ENDED JUNE 30, 2003 COMPARED TO YEAR ENDED JUNE 30, 2002
The net income for the year ended June 30, 2003 as compared to the year
ended June 30, 2002 represents the results of operations due to the
administration of the Company and its lone remaining assets,
approximately five acres of real estate. The Company?s major asset was
sold during the fiscal year ended June 30. 2001.
YEAR ENDED JUNE 30, 2002 COMPARED TO YEAR ENDED JUNE 30, 2001
The net income for the year ended June 30, 2002 as compared to the year
ended June 30, 2001 represents the results of operations due to the
administration of the Company and its lone remaining assets,
approximately five acres of real estate. The Company?s major asset was
sold during the fiscal year ended June 30, 2001.
YEAR ENDED JUNE 30, 2001 COMPARED TO YEAR ENDED JUNE 30, 2000
The net income for the year ended June 30, 2001 as compared to the year
ended June 30, 2000 reflects a gain from the sale of the adult rental
retirement facility which was the company?s major asset as described in
Note 7 to the financial statements.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
II-5
ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
I N D E X
PAGE
Independent Auditor?s Report II-7
FINANCIAL STATEMENTS:
Balance Sheets II-8
Statements of Operations II-9
Statements of Changes in Partners? Capital
(Deficit) II-10
Statements of Cash Flows II-11/12
Notes to Financial Statements II-13/18
SUPPLEMENTAL INFORMATION:
Exhibits indicating the Computation of
Earnings per Unit IV-4
Selected Financial Data II-2
Certification
II-6
FREEMAN, BUCZYNER & GERO
ONE SOUTHEAST THIRD AVENUE
SUITE 2150
MIAMI, FLORIDA 33131
305-375-0766
INDEPENDENT AUDITOR?S REPORT
To the Partners
All-State Properties, L.P.
Lauderhill, Florida
We have audited the accompanying balance sheets of All-State Properties
L.P. as of June 30, 2003, and 2002 and the related statements of
operations, partners? capital and cash flows for each of the three years
in the period ended June 30, 2003. These financial statements are the
responsibility of the partnership?s management. Our responsibility is to
express an opinion on these financial statements based on our audits.
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 audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provided a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of All-State
Properties L.P. at June 30, 2003 and 2002 and the results of its
operations and its cash flows for each of three years in the period
ended June 30, 2003 in conformity with accounting principles generally
accepted in the United States of America.
We have also previously audited, in accordance with auditing standards
generally accepted in the United States of America, the balance sheets
as of June 30, 2001, 2000 and 1999, and the related statements of
operations, partners? capital, and cash flows for the years ended June
30, 2000 and 1999 (none of which are presented herein); and we expressed
unqualified opinions on those financial statements. In our opinion, the
information set forth in the selected financial data for each of the
five years in the period ended June, 30 2003, appearing on page II-2,
and the exhibit indicating the computation of earnings per unit,
appearing on page IV-4, are fairly stated, in all material respects, in
relation to the financial statements from which it has been derived.
September 12, 2003
II-7
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
BALANCE SHEETS
JUNE 30, 2003 AND 2002
(AUDITED)
A S S E T S
JUNE 30
2 0 0 3 2 0 0 2
Cash $ 7,566 $ 34,348
Other assets - 1,210
Investment in real estate
partnership ? related parties
(Notes 1, 2 and 8) 299,582 309,664
Total Assets $ 307,148 $ 345,222
LIABILITIES AND PARTNERS? CAPITAL
LIABILITIES:
Partnership distributions
payable (Note 6) $ 10,152 $ 21,284
Deferred revenue ? related
party 68,207 68,207
Accounts payable and
other liabilities (Note 5) 15,545 14,823
Notes payable ? related
parties (Note 7) 34,000 -
$ 127,904 $ 104,314
COMMITMENTS AND CONTINGENCIES
(Notes 2 and 8)
PARTNERS? CAPITAL:
Partners? capital
(3,772,419 units authorized,
3,118,065 units outstanding)
(Notes 4 and 6) $ 374,024 $ 430,145
Notes receivable-officers/
partners including
accrued interest of
$54,923 in 2003 and
$49,379 in 2002 (Note 3) (194,780) (189,237)
$ 179,244 $ 240,908
TOTAL LIABILITIES AND PARTNERS?
CAPITAL $ 307,148 $ 345,222
See accompanying summary of accounting policies and notes to financial
statements.
II-8
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
STATEMENTS OF OPERATIONS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
2 0 0 3 2 0 0 2 2 0 0 1
REVENUES (Note 8):
Income (Loss) from real
estate partnership -
related parties
(Note 2) $ (10,082) $ (13,438) $ 6,872,555
Interest income
(Note 3) 5,594 7,624 59,564
$ (4,488) $ (5,814) $ 6,932,119
COST AND EXPENSES:
General and
administrative
expenses(Note 1E) $ 51,408 $ 79,340 $ 70,128
Interest (Notes 1E) 225 - 18,660
Total $ 51,633 $ 79,340 $ 88,788
NET INCOME (LOSS) $ (56,121) $ (85,154) $ 6,843,331
NET INCOME OR (LOSS)
PER PARTNERSHIP UNIT
(Note 1F) $ (0.02) $ (0.03) $ 2.19
CASH DISTRIBUTIONS PER
UNIT $ NONE $ NONE $ 0.40
See accompanying summary of accounting policies and notes to financial
statements.
II-9
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
STATEMENTS OF CHANGES IN PARTNERS? CAPITAL (DEFICIT)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTES TOTAL
RECEIVABLE PARTNERS
NUMBER GENERAL LIMITED OFFICERS/
CAPITAL
OF UNITS PARTNER PARTNERS PARTNERS (DEFICIT)
BALANCE - June 30, 2000 3,118,065 $ 2 $ (4,558,180) $ (230,049) $ (4,788,229)
Net (Loss) - - 6,843,331 - 6,843,331
Net increase in notes receivable-
Partners - - - 46,406 46,406
Partners distributions - - (1,769,852) - (1,769,852)
BALANCE - June 30, 2001 3,118,065 $ 2 $ 515,299 $ (183,643) $ 331,656
Net income - - (85,154) - (85,154)
Net decrease in notes receivable-
partners - - - (5,594) (5,594)
Partners distributions - - - - -
BALANCE ? June 30, 2002 3,118,065 $ 2 $ 430,143 $ (189,237) $ 240,908
Net (Loss) - - (56,121) - (56,121)
Net increase in notes receivable-
partners - - - (5,543) (5,543)
Partners distribution - - - - -
BALANCE - June 30, 2003 3,118,065 $ 2 $ 374,022 $ (194,780) $ 179,244
See accompanying summary of accounting policies and notes
to financial statements.
II-10
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
STATEMENTS OF CASH FLOWS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
YEARS ENDED JUNE 30,
2 0 0 3 2 0 0 2 2 0 0 1
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS
(Note 1E)
Cash Flows from Operating
Activities:
Interest and other income
received $ - $ 2,030 $ 105,970
Cash paid for general and
administrative expenses (49,650) (55,273) (101,408)
Interest paid - $ - (1,187,175)
Payment for shares escheated (11,132) (314,451) -
Net Cash (Used)
Provided by Operating
Activities $ (60,782) $ (367,694) $ (1,182,613)
Cash Flows from Financing
Activities:
Proceeds(payment) from
notes payable - net $ - $ - $ (508,461)
Proceeds (payments) on
note-related party - net 34,000 - (145,537)
Payment of debentures - - (1,643,198)
Net Cash Provided
(Used) by Financing
Activities $ 34,000 $ - $ (2,297,196)
Cash Flows from Investing
Activities:
Distribution to partners $ - $ - $ (1,707,897)
Distribution from partner-
ship - - 5,584,432
Net Cash Provided (Used)
by Investing Activities $ - $ - $ 3,876,535
See accompanying summary of accounting policies and notes to financial
statements.
II-11 (1 of 2)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
STATEMENTS OF CASH FLOWS (CONTINUED)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
2 0 0 3 2 0 0 2 2 0 0 1
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ (26,782) $ (367,694) $ 396,726
CASH AND CASH EQUIVALENTS
AT BEGINNING OF YEAR 34,348 402,042 5,316
CASH AND CASH EQUIVALENTS
AT END OF YEAR $ 7,566 $ 34,348 $ 402,042
See accompanying summary of accounting policies and notes to financial
statements.
II-11 (2 of 2)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
STATEMENTS OF CASH FLOWS (CONTINUED)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
YEARS ENDED JUNE 30,
2 0 0 3 2 0 0 2 2 0 0 1
Reconciliation of net income(Loss)
to net cash (used) provided
by operating activities:
Net Income (Loss) $ (56,121) $ (85,154) $ 6,843,331
Adjustments to reconcile net
(Loss) to net cash (used)
provided by operating
activities:
(Profit) Loss from real
estate partnership ?
related parties $ 10,082 $ 13,438 $ (6,872,555)
Changes in assets and liabilities:
Decrease in other assets 1,210 - -
(Decrease) in accrued interest -
notes payable - - (103,616)
(Decrease) in accrued interest ?
related party notes (net) - - (79,579)
(Increase) decrease in
notes receivable-partners (5,543) (5,594) 46,406
(Decrease) in 4% convertible
subordinated debenture accrued
interest - - (985,320)
(Decrease) increase in
liabilities 722 12,134 (31,280)
(Decrease) in partnership
distributions payable (11,132) (302,518) -
Total Adjustments $ (4,661) $ (282,540) $ (8,025,944)
NET CASH (USED) PROVIDED BY
OPERATING ACTIVITIES $ (60,782) $ (367,694) $ (1,182,613)
NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Deferred Revenue $ 0 68,207 -
Undistributed earnings in
partnerships ? related
parties $ (10,082) (54,769) -
Income (loss) from real
estate partnership
related parties $ (10,082) (13,438) -
See accompanying summary of accounting policies and notes to financial
statements.
II-12
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Organization and Operations
All-State Properties L.P. (a limited partnership) (the Company)
was organized under the Revised Uniform Limited Partnership Act of
Delaware on April 27, 1984 to conduct the business formerly
carried on by a predecessor corporation, All-State Properties,
Inc. (the Corporation). Pursuant to a Plan of Liquidation adopted
by shareholders of the Corporation on September 30, 1984, the
Corporation transferred substantially all of its assets to All-
State Properties L.P., and the Corporation distributed such
limited partnership interests to its shareholders.
The Company?s principal business has been land development and the
construction and sale of residential housing in Broward County,
Florida. However, it has substantially completed its land
development activities and the sale of residential housing. Its
present activities are:
Through a 36.12% owned Florida limited liability corporation,
Tunicom LLC (Tunicom)(formerly known as Unicom Partnership
Ltd.) the Company was engaged in the operation of a 324-unit
adult rental apartment project that was sold during the year
ended June 30, 2001.
Through a 50% owned real estate joint venture, City Planned
Communities (CPC), The Company was engaged in the development
and sale of commercial and residential land. City Planned
Community was liquidated on July 1, 2001.
B. Revenue Recognition
In accordance with SEC Staff Accounting Bulletin No. 101, ?Revenue
Recognition?, the Company recognizes income from its investment in
real estate partnerships utilizing the equity method, and interest
is recognized as earned with passage of time.
C. Income (Loss) Per Partnership Unit
Income (loss) per partnership unit is computed by dividing the net
income (loss) by the weighted average number of units outstanding.
No effect was given to the convertible debentures that were
dilutive and were repaid in 2001.
II-13
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. Cash and Cash Equivalents
For the purposes of the statements of cash flows, the Company
considers all highly liquid investments with a maturity of three
months or less to be cash equivalents.
E. Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results
could differ from those estimates.
F. Limited Partnership
The accompanying financial statements include only those assets,
liabilities and results of operations, which relate to the business
of All?State Properties, L.P. The financial statements do not
include any assets, liabilities, revenues, or expenses attributable
to the partners? individual activities.
G. Fair Value of Financial Instrument
We estimate that the fair market value of all of our financial
instruments at June 30, 2003 and 2002 are not materially different
from the aggregate carrying value due to the short-term nature of
these instruments.
H. Recent Accounting Pronouncements
In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 142,
?Goodwill and Other Intangible Assets.? Under SFAS No. 142, goodwill
and intangible assets with indefinite lives are no longer amortized
but are reviewed at least annually for impairment. The Company
adopted SFAS No. 142 effective July 1, 2002, which did not have a
material effect on the Company?s financial position or results of
operations.
Statement of Financial Accounting Standard No. 143, ?Accounting for
Asset Retirement Obligations?, (?SFAS 143?) requires entities to
record the fair value of a liability for an asset retirement
obligation in the period in which it is incurred. When the liability
is initially recorded, the entity capitalizes a cost by increasing
II-14 (1 of 3)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
H. Recent Accounting Pronouncements (Continued)
the carrying amount of the related long-lived asset. Over time, the
liability is accreted to its present value each period, and the
capitalized cost is depreciated over the useful life of the related
asset. Upon settlement of the liability, an entity either settles
the obligation for its recorded amount or incurs a gain or loss upon
settlement. The standard is effective for fiscal years beginning
after June 15, 2002. The adoption of SFAS 143 on July 1, 2002 did
not have a material effect on the Company?s results of operations or
liquidity.
In August 2001, the FASB issued SFAS No. 144, ?Accounting for the
Impairment or Disposal of Long-Lived Assets. This statement
supersedes FASB No. 121, ?Accounting for the Impairment of Long-
Lived Assets and for Long-Lived Assets to Be Disposed of? and the
accounting and reporting provisions of APB Opinion No. 30,
?Reporting the Results of Operations ? Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions.? The Company adopted
SFAS No. 144 effective July 1, 2002. The adoption of SFAS 144 did
not have a material impact on the Company?s financial position or
results from operations.
Statement of Financial Accounting Standards No. 145, ?Rescission of
FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No.
13, and Technical Corrections? (?SFAS 145?) updates, clarifies, and
simplifies existing accounting pronouncements. SFAS No. 145 rescinds
Statement 4, which required all gains and losses from extinguishment
of debt to be aggregated and, if material, classified as an
extraordinary item, net of related income tax effect. As a result,
the criteria in Opinion 30 will now be used to classify those gains
and losses. Statement 64 amended Statement 4, and is no longer
necessary because Statement 4 has been rescinded. Statement 44 was
issued to establish accounting requirements for the effects of
transition to the provisions of the motor Carrier Act of 1980.
Because the transition has been completed, Statement 44 is no longer
necessary. SFAS 145 amends Statement 13 to require that certain
lease modifications that have economic effects similar to sale-
leaseback transactions to accounted for in the same manner as sale-
leaseback transactions. This amendment is consistent with FASB?s
goal requiring similar accounting treatment for transactions that
have similar economic effects. This statement is effective for
fiscal years beginning after May 15, 2002. The adoption of SFAS 145
on July 1, 2002 did not have material impact on the Company?s
financial position, results of operations or liquidity.
II-14 (2 of 3)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
H. Recent Accounting Pronouncements (Continued)
Statement of Financial Accounting Standards No. 146, ?Accounting for
Exit or Disposal Activities? (?SFAS 146?) addresses the recognition,
measurement, and reporting of cost that are associated with exit and
disposal activities that are currently accounted for pursuant to the
guidelines set forth in EITF 94-3, ?Liability Recognition for
Certain Employee Termination Benefits and Other Costs to exit an
Activity (including Certain Cost Incurred in a Restructuring),? cost
related to terminating a contract that is not a capital lease and
one-time benefit arrangements received by employees who are
involuntarily terminated ? nullifying the guidance under EITF 94-3.
Under SFAS 146, the cost associated with an exit or disposal
activity is recognized in the periods in which it is incurred rather
than at the date the Company committed to the exit plan. This
statement is effective for exit or disposal activities initiated
after December 31, 2002 with earlier application encouraged. The
adoption of SFAS 146 did not have a material impact on the Company?s
financial position, results of operations or liquidity.
In December 2002, the FSAB issued Statement of Financial Accounting
Standards No. 148,?Acounting for Stock-Based Compensation ?
Transition and Disclosure? (?SFAS 148?). SFAS 148 provides
alternative methods of transition to SFAS 123?s fair value method of
accounting for stock-based employee compensation. It also amends the
disclosure provisions of Statement 123 and APB Opinion No. 28,
Interim Financial Reporting, to require disclosure in the summary of
significant accounting policies of the effects of an entity?s
accounting with respect to stock-based employee compensation on
reported net income and earnings per share in annual and interim
financial statements. SFAS 148?s amendment of the transition and
annual disclosure requirements of SFAS 123 are effective for fiscal
years ending after December 15, 2002. SFAS 148?s amendment of the
disclosure requirements of Opinion 28 is effective for interim
periods beginning after December 15, 2002 and did not have a
material impact on the Company?s financial position, results of
operations or liquidity.
I. Reclassifications
Certain reclassifications were made to the 2002 financial statements
in order to conform with year 2003 presentation.
II-14 (3 of 3)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 2 - EQUITY (DEFICIENCY) IN PARTNERSHIPS AND NOTE RECEIVABLE
The Company owned a 50% interest in City Planned Communities (a general
partnership) (CPC) and owns a 36.12% limited partnership interest in a
Tunicom LLC (formerly known as Unicom Partnership Ltd.). The beneficial
owners of Tunicom LLC were substantially the same as the beneficial
owners of City Planned Communities. Tunicom LLC acquired land from City
Planned Communities and constructed an adult apartment rental
community.
In June, 1995, the partners of CPC agreed to contribute $13,351,210 in
notes, loans and accrued interest to Tunicom?s capital, and they
received a preferred distribution position. In 2001, through the sale
of substantially all the assets of Tunicom, funds were generated to
repay the preferred capital contributions in full.
The Company discontinued applying the equity method to its investment
in Tunicom LLC (Tunicom) in 1988 when the investment account was
reduced to zero. The Company resumed applying the equity method in 2001
after its share of the net income from Tunicom exceeded the share of
net losses that were not recognized in the amount of approximately
$6,000,000.
The Company?s share of Tunicom?s income (loss) was $(10,082) in 2003,
$13,438 in 2002 and $5,896,110 in 2001.
The Company?s equity (deficiency) in the partnership and the percentage
of the equity (deficit) in the partnerships to the total assets of the
Company as of June 30, is as follows,
TUNICOM
PARTNERSHIP
LTD.
(NOTE 12)
2003 $ 299,582
2003 97.00%
2002 $ 309,664
2002 90.00%
II-15
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 2 - EQUITY (DEFICIENCY) IN PARTNERSHIPS AND NOTE RECEIVABLE (CONTINUED)
In consideration of cash advances in the amount of $13,351,210 made and
services rendered by certain individuals to Tunicom, Tunicom agreed to
distribute to these individuals 26.76% (including 5% to the general
partner of the Company) of any of its cash that becomes available for
distribution.
In accordance with the distribution agreements of Tunicom and CPC, and
after the distribution of $13,351,210 was made in 2001, the Company
received a distribution of approximately $5,800,000 and is presently
entitled to receive 36.12% of future distributions. As a result of
prior years cash advances made to Tunicom by certain individuals on
behalf of the Company, The Company agreed to give these individuals
3.60% of its share of the 36.12%.
The Company also assigned 10.23% of its share of distributions from CPC
to individuals in consideration of funds advanced by them to the
Company.
NOTE 3 - NOTES RECEIVABLE - PARTNERS
In 1984, the Company received cash and notes receivable from the former
treasurer and the general partner of the Company as a result of the
exercise of options to acquire shares of common stock, which were
subsequently exchanged for limited partnership units.
The notes bear interest at 4% per annum, are non-recourse and are
payable solely from the Company?s distributions. The Company has a lien
on and a security interest in the units. All cash distributions are to
be applied first to accrued interest, and then as a reduction of
principal until paid in full. The notes and interest receivable have no
maturity dates and because they are payable solely from the
distributions, are reflected as a reduction of the equity of the
Company.
Based on the potential sale of Tunicom?s land, the Company estimates
that after projected expenses approximately $16,000 will be distributed
to these unit owners. The balance of the notes will be written off after
the actual distribution is applied.
II-16
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 4 - INCOME TAXES
The partnership is not subject to income taxes. Instead, the partners are
required to include in their income tax return their share of the
Company?s income or loss as adjusted to reflect the effects of certain
transactions which are accorded different accounting treatment for federal
income tax purposes. The partnership?s approximate income (losses) for tax
reporting purposes for the years ended June 30, 2003, 2002 and 2001 was
$(58,000), $(85,000) and $6,400,000, respectively, which approximates
income (losses) of ($0.02), ($0.03), and ($2.06) per unit, respectively,
based on 3,118,065 outstanding partnership units.
NOTE 5 - ACCOUNTS PAYABLE AND OTHER LIABILITIES:
Account payable and other
liabilities at June 30
consist of the following:
2 0 0 3 2 0 0 2
Fees $ 15,320 $ 14,981
Other 225 9,192
$ 15,545 $ 24,173
NOTE 6 - PARTNERS? CAPITAL (DEFICIT)
The limited partnership, from inception through June 30, 2003, has
declared accumulated distributions of $1.25 per each partnership unit
outstanding. The partnership distributions payable represent the Company?s
liability to the states for escheated units.
During the year ended June 30, 2003, the Company escheated accumulated
distributions in the amount of $11,132 to the various states.
The Company did not declare any distributions to its unit owners during
the year June 30, 2003.
NOTE 7 ? NOTES PAYABLE RELATED PARTIES
2 0 0 3 2 0 0 2
Note payable general partner
Unsecured non-interest bearing
demand note $ 24,000 $ -
Note payable Tunicom L.L.C.
Unsecured 6% per annum demand note
unpaid interest of $225 included
in accounts payable 10,000 -
$ 34,000 $ -
II-17
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 8 - TUNICOM LLC ? OPERATIONS
On August 16, 2000, Tunicom sold the adult rental retirement facility,
including the real property and certain tangible and intangible assets,
for a purchase price of $47,159,295. After giving effect to a deposit of
$4,500,000 previously accounted for, the existing mortgage in the amount
of $26,720,254 and various adjustments, Tunicom received net proceeds of
$16,379,732. Tunicom distributed $16,200,000 to its partners and All-State
Properties, L.P.?s share was approximately $5,800,000, which was used to
pay the Company?s outstanding debentures and accrued interest in the
amount of $2,638,324 and liabilities in the amount of $769,038.
Total revenue includes additional income in the amount of $5,150,666 from
real estate partnerships resulting from the realization of a $4,407,944
(All-State Properties? share) allowance for loss that had been previously
deducted against the investment in Tunicom and the balance from the
adjustment of the Company?s equity in the partnerships.
Tunicom L.L.C. retained approximately five acres for sale as a site for an
assisted living facility. This represents Tunicom?s sole remaining asset.
After the sale of Forest Trace. Tunicom negotiated with the buyer of
Forest Trace for the sale of the five-acre parcel at a purchase price of
$1,000,000. When the buyer of Forest Trace advised Tunicom that it had no
interest in acquiring the five-acre parcel, Tunicom sought an alternate
purchaser.
Tunicom has now entered into an agreement of purchase and sale to sell the
property for a price of $1,700,000. closing the transaction at that price,
however, is contingent upon seller obtaining at its cost all governmental
approvals required before a building permit can be issued and the
availability of financing acceptable buyer. Partners of Tunicom (with All-
State Properties L.P. and its general partner abstaining) representing a
majority interest in Tunicom voted to approve the transaction and the
payment at closing of a fee in the amount of $250,000, to All-State
Properties L.P?s general partner for accomplishing the obtaining of all of
the necessary approvals, governmental and otherwise, required under the
agreement of purchase and sale and for assisting the buyer in securing the
required financing. The general partner of All-State Properties L.P. is
the president of the manager of Tunicom.
As a condition of the sale, the buyer has also insisted that All-State
Properties L.P.?s general partner agree to manage the facility once built.
There can be no assurance that the transaction contemplated by the
agreement of purchase and sale will close.
II-18
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINED FINANCIAL STATEMENTS
JUNE 30, 2003
AUDITED
C O N T E N T S
PAGE
Independent Auditor?s Report II-20
Combined Financial Statements:
Balance Sheets II-21
Statements of Operations II-22
Statements of Partners? Capital (Deficit) II-23
Statements of Cash Flows II-24/25
Notes to Financial Statements II-26/30
Supplemental Information:
Explanation of eliminations to combining
financial statements II-31
Combining Balance Sheets II-32/33
Combining Statements of Operations II-34
Combining Statements of Partners? Capital
(Deficit) II-35
Combining Statements of Cash Flows II-36/38
Selected Financial Data II-3
II-19
FREEMAN, BUCZYNER & GERO
ONE SOUTHEAST THIRD AVENUE
SUITE 2150
MIAMI, FLORIDA 33131
305-375-0766
INDEPENDENT AUDITOR?S REPORT
To the Partners
Tunicom LLC
Lauderhill, Florida
We have audited the accompanying combined balance sheets of City Planned
Communities (liquidated July 1, 2001) and Tunicom LLC (F.K.A. Unicom
Partnernship, Ltd. ? Note 1) as of June 30, 2003, and 2002 and the related
statements of operations, partners? capital and cash flows for each of the
three years in the period ended June 30, 2003. These financial statements are
the responsibility of the partnerships? management. Our responsibility is to
express an opinion on these financial statements based on our audits.
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 audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provided a reasonable basis for our opinion.
In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the financial position of City Planned
Communities and Tunicom LLC (F.K.A. Unicom Partnership, Ltd.) as of June 30,
2003 and 2002, and the results of their operations and their cash flows for
each of three years in the period ended June 30, 2003, in conformity with
accounting principles generally accepted in the United States of America.
We have also previously audited, in accordance with auditing standards
generally accepted in the United States of America, the combined balance
sheets as of June 30, 2001, 2000 and 1999, and the related statements of
operations, partners? capital, and cash flows for the years ended June 30,
2000 and 1999 (none of which are presented herein); and we expressed
unqualified opinions on those financial statements. In our opinion, the
information set forth in the selected financial data for each of the five
years in the period ended June, 30 2003, appearing on page II-3, and the
explanation of eliminations to combining financial statements and related
combining balance sheets and statements of operations, partners? capital and
cash flows, appearing on pages II-31 and through II-38, are fairly stated, in
all material respects, in relation to the financial statements from which it
has been derived.
September 12, 2003
II-20
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINED BALANCE SHEETS
JUNE 30, 2003 AND 2002
(AUDITED)
A S S E T S
JUNE 30
2 0 0 3 2 0 0 2
Land and development costs ( Note 1C) $ 783,253 $ 723,410
Cash 31,773 112,719
Note receivable and accrued interest ?
related party 10,225 -
Prepaid expenses 30,025 30,025
Total Assets $ 855,276 $ 866,154
LIABILITIES AND PARTNERS? CAPITAL
LIABILITIES:
Accounts payable and accrued
expenses (Note 2) $ 26,118 $ 8,835
COMMITMENTS AND CONTINGENCIES
(Note 5) - -
PARTNERS? CAPITAL 829,158 857,319
TOTAL LIABILITIES AND PARTNERS?
CAPITAL $ 855,276 $ 866,154
See accompanying summary of accounting policies and notes
to financial statements.
II-21
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINED STATEMENTS OF OPERATIONS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
2 0 0 3 2 0 0 2 2 0 0 1
REVENUES:
Net sale of assets
(Note 7) $ - $ - $ 21,705,571
Interest and other income 778 1,356 50,487
Forgiveness of interest
(Note 4 and 7) - - 2,226,737
$ 778 $ 1,356 $ 23,982,795
EXPENSES:
General and
administrative
(Note 3) $ 28,939 $ 34,933 $ 982,114
Taxes and insurance - 6,350 92,046
$ 28,939 $ 41,283 $ 1,074,160
NET INCOME (LOSS) BEFORE
DEPRECIATION , AMORTIZ-
ATION AND INTEREST: $ (28,161) $ (39,927) $ 22,908,635
OTHER EXPENSES:
Interest $ - $ - $ 272,309
$ - $ - $ 272,309
NET INCOME (LOSS) $ (28,161) $ (39,927) $ 22,636,326
See accompanying summary of accounting policies and notes
to financial statements.
II-22
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINED STATEMENTS OF PARTNERS? CAPITAL (DEFICIT)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
2 0 0 3 2 0 0 2 2 0 0 1
PARTNERS? CAPITAL
(DEFICIT) - Beginning $ 857,319 $ 758,101 $ (5,460,970)
Distributions
(Note 5) - - (16,417,255)
Liquidation of City
Planned Communities - 136,415 -
Contributions - 2,730 -
Net income (loss) (28,161) (39,927) 22,636,326
PARTNERS? CAPITAL
(DEFICIT) - Ending $ 829,158 $ 857,319 $ 758,101
See accompanying summary of accounting policies and notes to financial
statements.
II?23
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINED STATEMENTS OF CASH FLOWS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
2 0 0 3 2 0 0 2 2 0 0 1
INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS
Cash Flows from Operating
Activities:
Interest received $ 778 $ 1,356 $ 144,191
Cash paid - interest - - (407,180)
Cash paid ? suppliers,
employees and administrative
expenses (11,881) (34,759) (1,482,450)
Net sales of property - - 43,214,691
Net Cash (Used)
Provided by Operating
Activities $ (11,103) $ (33,403) $ 41,469,252
Cash Flows from Investing
Activities:
Capital expenditures - net $ (59,843) $ (19,600) $ -
Partners? (distributions)
contributions - net - - (16,417,256)
Net Cash Provided
(Used) by Investing
Activities $ (59,843) $ (19,600) $ (16,417,256)
Cash Flows from Financing
Activities:
Cash received (paid) ?
related party $ (10,000) $ - $ 200,611
Cash received (paid)
notes and mortgages - - (26,751,910)
Net Cash (Used) Provided
by Financing Activities $ (10,000) $ - $ (26,551,299)
See accompanying summary of accounting policies and notes to financial
statements.
II-24 (1 of 2)
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIAABILITY CORPORATION)
COMBINED STATEMENTS OF CASH FLOWS (CONTINUED)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
2 0 0 3 2 0 0 2 2 0 0 1
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS $ (80,946) $ (53,003) $ (1,499,303)
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR 112,719 165,722 1,665,025
CASH AND CASH EQUIVALENTS -
END OF YEAR $ 31,773 $ 112,719 $ 165,722
See accompanying summary of accounting policies and notes to financial
statements.
II-24 (2 of 2)
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINED STATEMENTS OF CASH FLOWS (CONTINUED)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
YEARS ENDED JUNE 30,
2 0 0 3 2 0 0 2 2 0 0 1
Reconciliation of net income
to net cash provided (used)
by operating activities:
Net Income (Loss) $ (28,161) $ (39,927) $ 22,636,326
Adjustments to reconcile net
income (loss) to net cash provided
(used)by operating activities:
Decrease in property
plant and equipment $ - $ - $ 24,496,319
(Increase) in accrued
interest ? notes receivable (225) - (134,871)
Decrease in prepaid expenses - - 159,596
Decrease in other assets and
accounts receivable - 2,730 -
Decrease (increase) in
accounts payable and
accrued expenses 17,283 3,794 (1,165,326)
Decrease in deferred
management fee - - 597,440
Decrease in deferred profit - - (2,987,200)
Decrease in unamortized
interest - - (2,212,612)
Decrease in notes receivables - - 79,579
Total Adjustments $ 17,058 $ 6,524 $ 18,832,925
NET CASH (USED) PROVIDED BY
OPERATING ACTIVITIES $ (11,103) $ (33,403) $ 41,469,251
NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Land and development costs $ - (170,518) -
Deferred management fees ?
related parties - 34,103 -
Partners? capital $ - 136,415 -
See accompanying summary of accounting policies and notes to financial
statements.
II-25
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC(A LIMITED LIABILITY CORPORATION)
NOTES TO COMBINED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Organization, Operations and Principles of Combination
1. City Planned Communities (Hereafter CPC)
The Partnership was formed in 1968 and was engaged in the
business of land sales in Broward County, Florida. The two
fifty percent partners of CPC were All-State Properties L.P. (a
limited partnership) and NLI Partners, Ltd. (a limited
partnership). The partnership was liquidated on July 1, 2001.
2. Tunicom LLC (Hereafter Tunicom)
The limited liability corporation (formerly known as Unicom
Partnership, Ltd.) was formed on October 27, 1986 to acquire
land from CPC for the purpose of constructing and operating a
324 unit rental project in Broward County, Florida, which
operated as an adult apartment rental complex (AARC). Effective
July, 1997, Tunicom leased its property and in August 2000 the
rental property was sold (Note 7).
3. Basis for Combination
All-State Properties L.P. and entities under common control
with the partners of NLI Partners, Ltd. Have a 93% limited
partnership interest in Tunicom. Accordingly, the beneficial
owners of Tunicom are substantially the same as those of CPC.
Therefore, the financial statements of CPC and Tunicom are
being presented on a combined basis to offer a more complete
presentation of the related entities. All intercompany
transactions have been eliminated to combination.
In 1987, Tunicom purchased 78 acres of land from CPC. Due to
the related ownership and control of the two entities and in
accordance with prescribed accounting standards. CPC deferred
the gross profit of approximately $3,158,000 from this sale and
a related management fee expense of $631,000. In 2001 when
substantially all the property was sold, CPC recognized
deferred income of $2,987,000 and a management fee of $597,000.
The balance of the deferred revenue of approximately $170,000
and the related management fee expense of $34,000 were
eliminated upon liquidation of CPC in July 2001 and assumed by
the partners.
II-26
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
NOTES TO COMBINED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
A. Organization, Operations and Principles of Combination (Continued)
4. Cash and Cash Equivalent
For purposes of the statements of cash flows, the Company
considers all unrestricted cash with maturities of three months
or less to be cash equivalents.
5. Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles 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 financial statements and the
reported amounts of revenues and expenses during the reporting
periods. Actual results could differ from those estimates.
B. Property and Equipment (Note 7)
1. The building that was sold in August 2000 was depreciated using
the straight-line method over an estimated useful life of 40
years for financial statement purposes, whereas the modified
accelerated cost recovery system (MACRS) method over 27-1/2
years was used for tax presentation. Since the company is a
partnership, income or losses are reported by the partners.
Accordingly, no tax effect resulted from the temporary
differences.
2. Furniture and equipment that were sold in August 2000 were
depreciated using MACRS form both tax and financial statement
presentation. Differences between this method and other
accelerated depreciated methods were not material.
C. Land and Development Cost
Land is recorded at cost and includes costs capitalized in
connection with the development of real estate.
D. Income Tax Reporting
For income tax purposes, CPC reported on the cash basis of
accounting while Tunicom reports on the accrual basis. Both
utilize the accrual basis of accounting for financial reporting
purposes. No provision is made in the financial statements for
income taxes since such taxes are the responsibility of the
partners and not the partnerships.
II-27
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
NOTES TO COMBINED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
E. Partnership and Limited Liability Corporation
The accompanying combined financial statements includes only those
assets, liabilities and results of operations, which relates to the
businesses of City Planned Communities, a Partnership, and Tunicom
LLC, a limited liability corporation. The financial statements do
not include any assets, liabilities, revenues, or expenses
attributable to the partners? and members? individual activities.
NOTE 2 ? ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued
Expenses at June 30, 2003 and
2002 consist of the following:
2 0 0 3 2 0 0 2
Accounts payable $ 20,118 $ 2,723
Real estate taxes 6,000 5,500
$ 26,118 $ 8,223
NOTE 3 ? TRANSACTIONS WITH RELATED PARTIES
Management Agreements
The operations of Tunicom?s adult apartment rental complex was managed
by an individual who is the general partner of All-State Properties L.P.
The agreement with the individual?s management company called for an
assignment of a 5% interest of all available cash flows for services
rendered. The agreement was terminated when the facility was sold in
August 2000. (See Note 5A)
NOTE 4 ? MORTGAGE LOAN PAYABLE
The mortgage on the property that was sold in August 2000, beared interest
at 8% per annum was insured by the Department of Housing and Urban
Development (HUD) and was payable in monthly installments of $198,051.
During the year ended June 30, 2001, total interest incurred of $272,309
was charged to operations. As a result of the mortgage modification in
1985, $2,498,809 in accrued interest was forgiven. This amount was
recorded as a deferred interest adjustment and was being amortized over
the remaining term of the mortgage. The unamortized balance of the
interest forgiveness was recognized in full upon sale of the property.
(See Note 7)
II-28
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
NOTES TO COMBINED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 5 ? COMMITMENTS AND CONTINGENCIES
A. Management Contract (See Note 3)
On July 1, 1997, the tenant of the facility appointed a management
company that is owned by a partner of the Partnership. The management
company was paid a fee equal to 4% of the monthly revenue. The
management agreement was terminated upon sale of the rental property in
August 2000.
B. Distributions
Presently, the cash flow that becomes available for distribution will
be distributed as follows:
3.49% to the non-partner distributes
As to the partners:
1.00% to F. Trace, Inc. the former general
partner of Tunicom
23.27% to the newly admitted limited partners
36.12% to Newnel Partnership
36.12% to the Company (including 3.60% given
to certain individuals who made cash
advances to Tunicom on behalf of the
the Company)
100.00%
C. Lease Agreement
On July 1, 1997, the Partnership entered into an agreement with an
intended purchaser who leased the facility for a three-year period
after which time the purchaser was able to purchase the property or
cancel the option and forfeit their deposit. The agreement called for
the tenant to pay the Partnership a base rent equal to the monthly
principal and interest on the outstanding HUD financing plus the
amounts necessary for payment of the various escrows related to the HUD
financing. The tenant retained $812,712, $1,750,000 and $1,275,000,
respectively, during the three year period, and the Partnership was
paid all other remaining revenue from the facility that exceeded a
certain threshold.
On March 10, 2000 the intended purchaser assigned its interest, rights
and option to purchase the property to an unrelated company. The
Assignee purchased the property on August 16, 2000 (Note 7).
II-29
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
NOTES TO COMBINED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
NOTE 6 - PENSION PLAN
During year ended June 30, 2001, Tunicom had a 401k pension plan.
Employees were eligible to participate in the plan if they have been
employed by the Partnership for one year, work at least 20 hours per week,
work a total of at least 1000 hours per year and were at least 21 years of
age. The employer did not make a matching contribution.
NOTE 7 ? SALE OF THE ADULT RENTAL RETIREMENT FACILITY
In connection with the sale of the adult rental retirement facility which
closed on August 16, 2000, Tunicom LLC (?Tunicom?) (a limited liability
corporation), was formed on August 14, 2000 as the successor to Unicom
Partnership, Ltd. (?Unicom?). Tunicom succeeded to all of the assets and
the liabilities of Unicom.
On August 16, 2000, Tunicom sold the adult rental retirement facility,
including the real property and certain tangible and intangible assets,
for a purchase price of $47,159,295. After giving effect to the deposit of
$4,500,000 previously accounted for, the existing mortgage in the amount
of $26,720,254 and various adjustments, Tunicom LLC received net proceeds
of $16,379,732. Tunicom distributed $16,200,000 to its partners and All-
State Properties, L.P.?s share was approximately $5,800,000.
II-30
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC(A LIMITED LIABILITY CORPORATION)
EXPLAINATION OF COMBINING FINANCIAL STATEMENTS
JUNE 30, 2001
AUDITED
The combining financial statements for City Planned Communities (CPC)
(liquidated July 1, 2001) and Tunicom LLC, (Tunicom) are presented for the
year ended June 30, 2001 as supplemental information to the combined financial
statements. All significant transactions between CPC and Tunicom for the year
ended June 30, 2001 have been eliminated. Descriptions of the eliminations are
as follows:
(a) Cost of land purchased by Tunicom from CPC in 1987 has been adjusted to
reflect the carrying value of property, computed as follows:
Land cost $ 250,578
Land development cost 571,704
Closing cost 20,000
Carrying value of property $ 842,282
Selling price (4,000,000)
Adjustment to land and construction in
progress and deferred profit $ (3,157,718)
Amount realized on sale of property
in 2001 2,987,200
$ (170,518)
II-31
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING BALANCE SHEETS
JUNE 30, 2001
AUDITED
CITY TUNICOM LLC COMBINED
PLANNED BALANCE
COMMUNITIES ELIMINATIONS SHEET
ASSETS
Property and equip-
ment at cost:
Land and develop-
ment costs $ - $ 703,810 $ (170,518)(a) $ 533,292*
$ - $ 703,810 $ (170,518) $ 533,292
Cash - 165,722 - 165,722
Deferred management
fees - related
party 34,103 - - 34,103
Other assets - 30,025 - 30,025*
TOTAL ASSETS $ 34,103 $ 899,557 $ (170,518) $ 763,142
* Reclassified for comparative purposes.
See accompanying summary of accounting policies and notes to financial
statements.
II-32
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING BALANCE SHEETS (CONTINUED)
JUNE 30, 2001
AUDITED
CITY TUNICOM LLC COMBINED
PLANNED BALANCE
COMMUNITIES ELIMINATIONS SHEET
LIABILITIES AND PARTNERS? CAPITAL (DEFICIT)
LIABILITIES:
Accounts payable
and accrued
expenses $ - $ 5,041 $ - $ 5,041
Tenant security
deposits - - - -
Deferred profit 170,518 - (170,518) -
$ 170,518 $ 5,041 $ (170,518) $ 5,041
COMMITMENTS AND
CONTINGENCIES - - - -
PARTNERS? CAPITAL
(DEFICIT) (136,415) 894,516 - 758,101
TOTAL LIABILITIES
AND PARTNERS?
CAPITAL (DEFICIT) $ 34,103 $ 899,557 $ (170,518) $ 763,142
See accompanying summary of accounting policies and notes to financial
statements.
II-33
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING STATEMENTS OF OPERATIONS
JUNE 30, 2001
AUDITED
CITY TUNICOM LLC COMBINED
PLANNED STATEMENT OF
COMMUNITIES ELIMINATIONS OPERATIONS
REVENUES:
Net sale assets $ 16,134 $ 17,505,001 $ 2,987,200 $ 20,508,335
Interest and
other income 1,758 48,729 - 50,487
Forgiveness of
Interest - 2,226,737 - 2,226,737
Deferred profit
on sale of land 2,987,200 - (2,987,200) -
$ 3,005,092 $ 19,780,467 $ - $ 22,785,559
EXPENSES:
General and
administrative $ 604,640 $ 377,474 $ - $ 982,114
Taxes and
insurance - 92,046 - 92,046
$ 604,640 $ 469,520 $ - $ 1,074,160
NET INCOME BEFORE
DEPRECIATION,
AMORTIZATION AND
INTEREST $ 2,400,452 $ 19,310,947 $ - $ 21,711,399
OTHER EXPENSES:
Interest $ - $ 272,309 $ - $ 272,309
NET (L0SS) INCOME $ 2,400,452 $ 19,038,638 $ - $ 21,439,090
See accompanying summary of accounting policies and notes to financial
statements.
II-34
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING STATEMENTS OF PARTNERS? CAPITAL (DEFICIT)
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
AUDITED
COMBINED
STATEMENT
CITY TUNICOM LLC OF PARTNERS'
PLANNED CAPITAL
COMMUNITIES ELIMINATIONS (DEFICIT)
PARTNERS'
CAPITAL
(DEFICIT) -
June 30,
2000 $ (2,319,611) $ (3,141,359) $ - $ (5,460,970)
Net Income
(Loss)2001 2,400,452 20,235,875 - 22,636,327
Distribution (217,256) (16,200,000) - (16,417,256)
PARTNERS?
CAPITAL
(DEFICIT)-
June 30,
2001 $ (136,415) $ 894,516 $ - $ 758,101
Net income
(Loss) -
2002 - (39,927) - (39,927)
Liquidation 136,415 - - 136,415
Contribution - 2,730 - 2,730
PARTNERS'
CAPITAL -
June 30,
2002 $ - $ 857,319 $ - $ 857,319
Net Income
(Loss) -
2003 - (28,161) - (28,161)
PARTNERS?
CAPITAL ?
June 30,
2003 $ - $ 829,158 $ - $ 829,158
See accompanying summary of accounting policies and notes to financial
statements.
II-35
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING STATEMENTS OF CASH FLOWS
YEAR ENDED JUNE 30, 2001
AUDITED
CITY TUNICOM LLC COMBINED
PLANNED STATEMENT OF
COMMUNITIES ELIMINATONS CASH FLOWS
INCREASE (DECREASE)
IN CASH AND CASH
EQUIVALENTS
Cash Flows from
Operating Activi-
ties:
Interest received $ 81,337 $ 62,854 $ - $ 144,191
Cash paid - interest - (407,180) - (407,180)
Cash paid - suppliers,
employees and admini-
strative expenses (35,724) (1,446,726) - (1,482,450)
Net sale of property 25,800 43,188,890 - 43,214,690
Net Cash (Used)
Provided by Opera-
ting Activities $ 71,413 $ 41,397,838 $ - $ 41,469,251
Cash Flows from Invest-
ing Activities:
Partner distribution $ (217,256) $ (16,200,000) - $ (16,417,256)
Net Cash (Used) Provided
by Investing Acti-
vities $ (217,256)$ (16,200,000) $ - $ (16,417,256)
Cash Flows from Fi-
nancing Activities:
Cash received
(paid) - related
party $ 145,537 $ 55,074 $ - $ 200,611
Cash (paid)
received -
notes and
mortgages - (26,751,910) - (26,751,910)
Net Cash Provided
(Used) by Financ-
ing Activities $ 145,537 $ (26,696,836) $ - $ (26,551,299)
See accompanying summary of accounting policies and notes to financial
statements.
II-36
CITY PLANNED COMMUNITIES (A PARTNERSHIP (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING STATEMENTS OF CASH FLOWS (CONTINUED)
YEAR ENDED JUNE 30, 2001
AUDITED
COMBINED
CITY STATEMENT
PLANNED OF
COMMUNITIES TUNICOM LLC ELIMINATONS CASH FLOWS
NET (DECREASE) INCREASE
IN CASH AND CASH
EQUIVALENTS $ (306) $ (1,498,997) $ - $ (1,499,303)
CASH AND CASH EQUIVA-
LENTS BEGINNING OF
YEAR 306 1,664,719 - 1,665,025
CASH AND CASH EQUIVA-
LENTS END OF YEAR $ - $ 165,722 $ - $ 165,722
See accompanying summary of accounting policies and notes to financial
statements.
II-37
CITY PLANNED COMMUNITIES (A PARTNERSHIP) (LIQUIDATED JULY 1, 2001)
AND TUNICOM LLC (A LIMITED LIABILITY CORPORATION)
COMBINING STATEMENTS OF CASH FLOWS (CONTINUED)
YEAR ENDED JUNE 30, 2001
AUDITED
CITY COMBINED
PLANNED STATEMENT OF
COMMUNITIES TUNICOM LLC ELIMINATONS CASH FLOWS
Reconciliation of net
profit (Loss) to net
cash provided (used)
by operating activities:
Net income $ 2,400,452 $ 20,235,874 $ - $ 22,636,326
Adjustments to recon-
cile to net income (used)
by operating activities:
Decrease in property,
plant and equipment $ 9,666 $ 24,486,653 $ - $ 24,496,319
Decrease in deferred
management fees 597,440 - - 597,440
Decrease in deferred
profit (2,987,200) - - (2,987,200)
Decrease in un-
amortized interest - (2,212,612) - (2,212,612)
Decrease in accounts
expenses (35,410) (1,129,916) - (1,165,326)
Decrease of notes
receivable 79,579 - - 79,579
Decrease in prepaid
expenses 6,886 152,710 - 159,596
Decrease in notes
payable - (134,871) - (134,871)
Total Adjustments $ 2,329,039 $ 21,161,964 $ - $ 18,832,925
NET CASH PROVIDED (USED)
BY OPERATING ACTIVI-
TIES $ 71,413 $ 41,397,838 $ - $ 41,469,251
See accompanying summary of accounting policies and notes to financial
statements.
II-38
PART II
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT
The following information is provided with respect to each general
partner and officer of Registrant.
BUSINESS EXPERIENCE DURING
NAME AGE PAST FIVE YEARS
Stanley R. Rosenthal 74 General Partner;
President and Chief
Executive Officer of
predecessor All-State
Properties, Inc. since
1971
Managing Partner of
Tunicom LLC.
since 1989
President of SRR Consulting
Corp. and President of SRR
Management Corp. since July,
1997
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth aggregate cash compensation paid or
accrued by the Registrant to the General Partner during the twelve months
ended June 30, 2003.
NAME OF INDIVIDUAL OR REGISTRANT?S SHARE
NUMBER OF PERSONS CAPACITIES OF CASH
IN GROUP IN WHICH SERVED COMPENSATION
Stanley R. Rosenthal General Partner $ -0-
All officers as a group (1 person) $ -0-
III-1
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth as of June 30, 2002 information
concerning: (i) all the persons who are known to the Registrant to be the
beneficial owners of more than 5% of the units of limited partnership
interest; and (ii) the beneficial ownership of limited partnership units by
the General Partner.
AMOUNT
BENEFICIALLY PERCENTAGE
TITLE OF CLASS NAME & ADDRESS OWNED OF CLASS
Limited J.W. Sopher
Partnership 425 E. 61 Street
Units New York, N.Y. 165,000 (1) 5.3%
Limited Stanley R. Rosenthal
Partnership c/o All-State
Units Properties L.P.
P.O. Box 5524
Ft. Lauderdale, FL 156,474 5.0%
(1) Included 48,000 units owned directly and 117,000 units owned
beneficially (67,000 units owned by a pension trust and 50,000 units owned by
a corporation in which Mr. Sopher holds a 50% interest and in which Mr. Sopher
holds shared voting and dispositive powers).
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The following discussion of certain relationships and related
transactions should be read in conjunction with our financial statements and
notes thereto.
Name of specified person: Stanley R. Rosenthal
Relationship of such person: General Partner with
5% ownership interest
Amount of transactions: Notes receivable
(4% interest, non-recourse) $ 94,503
Accrued interest
receivable (non-recourse) $ 36,798
Note payable (no interest) $ (24,000)
Name of specified entity: Tunicom LLC
Relationship of such entity: 36.12% ownership interest in entity
Amount of transaction: Notes payable (6% interest) $ (10,000)
Accrued interest payable $ (225)
III-2
ITEM 14. CONTROLS AND PROCEDURES
(a) Evaluation of disclosure controls and procedures
The Company?s general partner, after evaluating the effectiveness
of our disclosure controls and procedures (as defined in Exchange Act Rules
13a-14(c) and 150d-14(c)) as of a date within 90 days of filing date of this
annual report (the ?Evaluation Date?), have concluded that as of the
Evaluation Date, our disclosure controls and procedures were adequate and
effective to ensure that material information relating to the Company would be
made known to them by others within the Company, particularly during the
period in which this annual report was being prepared.
(b) Changes in internal controls:
There were no significant changes in our internal controls or in
other factors that could significantly affect our internal controls and
procedures subsequent to the Evaluation Date, nor any significant deficiencies
or material weaknesses in such internal controls and procedures requiring
corrective actions. As a result, no corrective actions were taken.
ITEM 15. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following fees were invoiced by the auditing firm for the
years ended June 30,
2 0 0 3 2 0 0 2
Audit fees $ 19,500 $ 23,000
Tax fees 5,000 5,500
Other fees - -
$ 24,500 $ 28,500
The above services were not recognized at the time of engagement to be non-
audit services, and such services are approved by the Company?s general
partner prior to the completion of the audit.
III-3
PART IV
ITEM 16. EXHIBITS FINANCIAL STATEMENT SCHEDULE AND REPORTS ON
FORM 8-K
PAGE
(a) 1. Financial Statements included in Part II
of this report:
FINANCIAL STATEMENTS:
Registrant:
Balance Sheets as of June 30, 2003 and 2002 II-8
Statements of Operations for the years ended
June 30, 2003, 2002, and 2001 II-9
Statements of Changes in Partners' Capital
(Deficit) for the years ended June 30, 2003,
2002 and 2001 II-10
Statements of Cash Flows for the years ended
June 30, 2003, 2002 and 2001 II-11/12
Notes to Financial Statements for the years
ended June 30, 2003, 2002 and 2001 II-13/18
All other schedules are omitted, as the required information is not applicable
or the information is presented in the financial statements or related notes.
The registrant has not filed a Form 8-K during the fourth quarter of the
fiscal year.
IV-1
(b) (1) REPORTS ON FORM 8-K
PAGE NO. OR INCORPORATION
(C) EXHIBITS BY REFERENCE
(3) Limited Partnership Incorporated by reference
Agreement, All-State to the Registration
Properties L.P. Statement of Registrant
No. 2-90988
(4) (ii) Instruments
Defining Rights of
Security Holders,
included Debentures:
4% Convertible Sub- Incorporated by reference
ordinated Debenture, to Form 10-K for the year
due 1989 ended June 30, 1985
(10)(iii) (A) Material
Contracts:
a. Stock Purchase Incorporated by reference
agreement dated to the Registration
April 18, 1984 Statement of Registrant
between All-State No. 2-90988
Properties, Inc.
and Security
Management Corp.
b. Loan Agreement Incorporated by reference
between All-State to Form 10-K for the
Properties, L.P. and year ended June 30, 1987
City Nat'l Bank of
Florida dated April
20, 1987 - $2,400,000
c. Tunicom Partnership Incorporated by reference
Ltd. Limited Partner- to Form 10-K for the
ship Agreement dated year ended June 30, 1987
September 23, 1986
d. Loan Agreement Incorporated by reference
between Tunicom Partner- to Form 10-K for the year
ship Ltd. and Puller ended June 30, 1987
Mortgage Associates,
Inc. dated 4/23/87 -
$27,749,100
e. Management Contract Incorporated by reference
between Tunicom Partner- to Form 10-K for the year
ship Ltd. and Basic ended June 30, 1987
American Medical Inc.
dated Sept. 29, 1986
IV-2
f. Contract of Sale Incorporated by reference
between CPC and to Form 8-K dated
Centex Real Estate July 7, 1989
Corporation dated
May 2, 1989
g. Management Contract Incorporated by reference
between Tunicom Partner- to Form 10-K for the year
ship Ltd. and Senior ended June 30, 1989
Lifestyle Corporation
dated 7/1/89
h. Settlement Agreement Incorporated by reference
between CPC and MFM Group to Form 10-K for the year
dated March 28, 1990 ended June 30, 1990
i. Settlement Agreement Incorporated by reference
between Tunicom and MFM to Form 10-K for the year
Group dated March 28, 1990 ended June 30, 1990.
j. Amendment to Management Incorporated by reference
Contract between Tunicom and to Form 10-K for the year
Senior Lifestyle Corporation ended June 30, 1992
dated as of Jan. 1, 1992
k. Management Agreement Incorporated by reference
between Tunicom and Stanley to Form 10-K for the year
R. Rosenthal, Managing ended June 30, 1995
Partner of Owner dated
August 1, 1995
l. Employment Agreement Incorporated by reference
between Tunicom and Stanley to Form 10-K for the year
R. Rosenthal, effective ended June 30, 1995
August 1, 1995
m. Lease and option to pur- Incorporated by reference
chase agreements between to Form 8-K dated October
Tunicom and CareMatrix 10, 1997
Corporation effective
as of July 1, 1997
n. Disposition of assets in Incorporated by reference
accordance with Option to Form 8-K dated August
Agreement on August 16, 2000 16, 2000
(11) Exhibits indicating computa- IV-4
tion of earnings per unit for
the years ended June 30, 2003,
2002 and 2001.
(22) Subsidiaries of the Registrant:
(d) NONE
Signature Page IV-5
IV-3
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP) (NOTE 1A)
EXHIBITS INDICATING THE COMPUTATION OF EARNINGS PER UNIT
YEARS ENDED JUNE 30, 2003, 2002 AND 2001
2 0 0 3 2 0 0 2 2 0 0 1
Computation of pri-
mary earnings per
unit:
Units issued 3,118,065 3,118,065 3,118,065
3,118,065 3,118,065 3,118,065
Net Income (Loss)
Before Extraordinary
Items $ (56,121) $ (85,154) $ 6,843,331
Computation of Fully
diluted income (Loss)
per unit Before Extra-
ordinary Items $ (0.02) $ (0.03) $ 2.19
Net Income (Loss)
After Extraordinary
Items $ (56,121) $ (85,154) $ 6,843,311
Computation of Fully
diluted income (Loss)
per unit after Extra-
ordinary Items $ (0.02) $ (0.03) $ 2.19
(A) Weighted average number of units outstanding
See notes to financial statements.
IV-4
SIGNATURES
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.
ALL-STATE PROPERTIES L.P.
By: ____________________
STANLEY R. ROSENTHAL
General Partner
Date: September 12, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following person on behalf of the
Registrant and in the capacity and on the date indicated.
ALL-STATE PROPERTIES L.P.
By: ____________________
STANLEY R. ROSENTHAL
General Partner
Date: September 12, 2003
IV-5
Page 18 (1 of 2)
ALL-STATE PROPERTIES L.P.
CERTIFICATIONS
I, Stanley Rosenthal, certify that:
1. I have reviewed this annual report on Form 10-K of All-State Properties L.P.;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of , and for, the periods presented in this annual report;
4. The registrant?s other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being
prepared;
b) evaluated the effectiveness of the registrant?s disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
annual report (the ?Evaluation Date?); and
c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
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Page 18 (2 of 2)
CERTIFICATIONS
(Continued)
5. The registrant?s other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant?s auditors and the audit
committee of registrant?s board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant?s ability to record,
process, summarize and report financial data and have identified for the
registrant?s auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant?s internal
controls; and
6. The registrant?s other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
Date: September 12, 2003
_____________________
Stanley Rosenthal
General Partner
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