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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED DECEMBER 31, 2003 COMMISSION FILE NUMBER 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.)
5500 NW 69th Avenue, Lauderhill, FL 33319
(Address of principal executive offices) (Zip Code)
Mailing address:
P.O. Box 5524,Fort Lauderdale, FL 33310-5524
Registrant's telephone number, including area code (954) 572-2113
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(D) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the Registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
Indicate the number of limited partnership units outstanding as
of the latest practicable date.
Class Outstanding at December 31, 2003
Limited Partnership Units 3,118,303 Units
Page 1
ALL-STATE PROPERTIES L.P.
FORM 10-Q QUARTERLY REPORT
SIX MONTHS ENDED DECEMBER 31, 2003
I N D E X
PART 1 ? FINANCIAL INFORMATION
PAGE
ITEM 1 Financial Statements 2 - 8
ITEM 2 Management?s Discussion and Analysis
of Financial Condition and Results of
Operations. 9
ITEM 3 Quantitative and Qualitative Disclosures
About Market Risk. 9
ITEM 4 Controls and Procedures. 9
Supplemental Information and Exhibits 10 - 12
PART II ? OTHER INFORMATION
ITEM 1 Legal Proceedings 13
ITEM 2 Changes in Securities and Use of Proceeds 13
ITEM 3 Defaults Upon Senior Securities 13
ITEM 4 Submission of Matters to Vote of
Security Holders 13
ITEM 5 Other Information 13
ITEM 6 Exhibits and Reports on Form 8-K 13
Signatures 14
Certifications 15 - 16
ITEM 1 FINANCIAL STATEMENTS
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
* * * * * * * * * * * * * *
FINANCIAL STATEMENTS AND SCHEDULES
SIX MONTHS ENDED DECEMBER 31, 2003
Page 2
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
SIX MONTHS ENDED DECEMBER 31, 2003
I N D E X
PAGE
Independent Accountant?s Report 3
FINANCIAL STATEMENTS:
Condensed Balance Sheets 4
Condensed Statements of Operations 5
Condensed Statements of Cash Flows 6
Notes to Condensed Financial Statements 7 - 8
SUPPLEMENTAL INFORMATION:
Condensed Financial Information for
Real Estate Partnership:
Condensed Balance Sheet 10
Condensed Profit and Loss Information 11
Exhibit - Computation of Income (Loss)
Per Partnership Unit 12
Page 3 (1 of 2)
FREEMAN BUCZYNER & GERO
1 SE THIRD AVENUE
SUITE 2150
MIAMI, FLORIDA 33131
305-375-0766
INDEPENDENT ACCOUNTANT?S REPORT
To the Partners
All-State Properties, L.P.
Lauderhill, Florida
We have reviewed the condensed balance sheet of All-State
Properties L.P. as of December 31, 2003 and the related condensed
statements of operation for the three-month and six?month periods
ended December 31, 2003 and 2002 and cash flows for the six-month
periods ended December 31, 2003 and 2002. These financial
statements are the responsibility of the partnership?s
management.
We conducted our review in accordance with standards established
by the American Institute of Certified Public Accountants. A
review of interim financial information consists principally of
applying analytical procedures to financial data and making
inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit in
accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the
financial statements taken as a whole. Accordingly, we do not
express such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the condensed financial
statements referred to above for them to be in conformity with
generally accepted accounting principles.
We have previously audited, in accordance with auditing standards
generally accepted in the United States of America, the balance
sheet as of June 30, 2003, and the related statements of income,
partners? capital and cash flows for the year then ended (not
presented herein); and in our report dated September 12, 2003, we
expressed an unqualified opinion on those financial statements.
Page 3 (2 of 2)
FREEMAN BUCZYNER & GERO
1 SE THIRD AVENUE
SUITE 2150
MIAMI, FLORIDA 33131
305-375-0766
INDEPENDENT ACCOUNTANT?S REPORT
(CONTINUED)
In our opinion, the information set forth in the accompanying
condensed balance sheet as of June 30, 2003, is fairly stated, in
all material respects, in relation to the balance sheet from
which it has been derived.
Our review was made for the purpose of expressing limited
assurance that there are no material modifications that should be
made to the financial statements in order for them to be in
conformity with generally accepted accounting principles. The
information included in the condensed financial information for
Tunicom LLC, appearing on pages 10 and 11, and the exhibit
indicating the computation of earnings per unit, appearing on
page 12, is presented only for supplementary analysis purposes.
Such information has been subjected to the inquiry and analytical
procedures applied in the review of the basic financial
statements, and we are not aware of any material modifications
that should be made thereto.
Freeman, Buczyner & Gero
January 28, 2004
Page 4
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
CONDENSED BALANCE SHEETS
DECEMBER 31, 2003 AND JUNE 30, 2003
(UNAUDITED)
DECEMBER JUNE
31ST 30TH
Assets 2 0 0 3 2 0 0 3
Cash $ 1,532 $ 7,566
Investment in real estate in
partnership ? related parties 285,634 299,582
Total Assets $ 287,166 $ 307,148
Liabilities and Partners' Capital
Liabilities:
Accounts payable and other
liabilities $ 18,080 $ 15,545
Partnership distributions payable 10,152 10,152
Deferred revenue ? related party 68,207 68,207
Notes payable ? related party - 34,000
Bank ? line of credit 50,000 -
$ 146,439 $ 127,904
Partners' Capital $ 338,300 $ 374,024
Notes receivable - officers/partners (197,573) (194,780)
$ 140,727 $ 179,244
Total Liabilities and Partners'
Capital $ 287,166 $ 307,148
See accompanying notes and accountant?s review report.
Page 5
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
CONDENSED STATEMENTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
2 0 0 3 2 0 0 2 2 0 0 3 2 0 0 2
REVENUES:
Profit (loss) from
real estate part-
nerships- related
parties $ (12,539) $ (4,186) $ (13,948) $ (7,202)
Other income 1,394 1,410 2,793 2,841
$ (11,145) $ (2,776) $ (11,155) $ (4,361)
COST AND EXPENSES:
Selling, general
and administrative $ 12,641 $ 25,590 $ 23,890 $ 29,251
Interest 529 - 679 -
$ 13,170 $ 25,590 $ 24,569 $ 29,251
NET INCOME (LOSS) $ (24,315) $ (28,366) $ (35,724) $ (33,612)
NET (LOSS) INCOME PER
PARTNERSHIP UNIT (0.00) (0.01) (0.01) (0.01)
CASH DISTRIBUTIONS PER
UNIT NONE NONE NONE NONE
See accompanying notes and accountant?s review report.
Page 6 (1 of 2)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
CONDENSED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
(UNAUDITED)
2 0 0 3 2 0 0 2
CASH FLOW FROM OPERATING ACTIVITIES:
Interest income - collected $ - $ 45
Cash paid for selling, general and
administrative expenses (21,355) (26,417)
Interest expenses - paid (679) -
Net Cash Consumed by
Operating Activities $ (22,034) $ (26,372)
CASH FLOW FROM FINANCING ACTIVITIES:
Notes payable - related party $ (34,000) $ -
Bank ? line of credit 50,000 -
Net cash provided by financing
activities $ 16,000 $ -
NET (DECREASE) INCREASE IN CASH AND
CASH EQUIVALENTS $ (6,034) $ (26,372)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF YEAR 7,566 34,348
CASH AND CASH EQUIVALENTS AT END
END OF PERIOD $ 1,532 $ 7,976
RECONCILIATION OF NET (LOSS) INCOME
TO NET CASH CONSUMEDBY
OPERATING ACTIVITIES:
Net Loss $ (35,724) $ (33,612)
See accompanying notes and accountant?s review report.
Page 6 (2 of 2)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
CONDENSED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
(UNAUDITED)
ADJUSTMENTS TO RECONCILE NET (LOSS)
INCOME TO NET CASH CONSUMED
BY OPERATING ACTIVITIES:
2 0 0 3 2 0 0 2
(Income) Loss of real estate part-
nerships $ 13,948 $ 7,202
Changes in Assets and Liabilities:
Increase in partnership
distribution payable - 9,191
(Increase) in accrued interest
receivable (2,793) (2,797)
Increase (decrease) in accounts
Payable 2,535 (6,356)
Total adjustments $ 13,690 $ 7,240
NET CASH CONSUMED BY
OPERATING ACTIVITIES $ (22,034) $ (26,372)
See accompanying notes and accountant?s review report.
Page 7
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
NOTES TO CONDENSED FINANCIAL STATEMENTS
SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
1. UNAUDITED INTERIM FINANCIAL INFORMATION
The management of All-State Properties L.P. (a limited
partnership) (the Company) is responsible for the
accompanying unaudited interim financial statements and the
related information included in these notes to the unaudited
interim financial statements. In the opinion of management,
the unaudited interim financial statements reflect all
adjustments, consisting of normal recurring adjustments
necessary for the fair presentation of the Company?s
financial position and results of operations and cash flows
for the period presented. Results of operations of interim
periods are not necessarily indicative of the results to be
expected for the entire year.
These unaudited interim financial statements should be read
in conjunction with the audited financial statements of the
Company as of and for the fiscal year ended June 30, 2003
included in the Company?s Annual Report on Form 10-K for such
year as filed with the Securities and Exchange Commission
(the ?Commission?).
2. ORGANIZATION AND OPERATIONS
All-State Properties L.P. 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 completed its land
development activities and the sale of residential housing.
Page 8 (1 of 2)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
NOTES TO CONDENSED FINANCIAL STATEMENTS
SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
3. 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.
Tunicom retained approximately five acres of the adult
retirement facility and is currently developing the property
for future sale of the site as an assisted living facility.
Tunicom has now entered into an agreement of purchase and
sale to sell the property for $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.
Page 8 (2 of 2)
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
NOTES TO CONDENSED FINANCIAL STATEMENTS
SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
3. TUNICOM LLC ? OPERATIONS (CONTINUED)
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.
4. BANK ? LINE OF CREDIT
The Company is indebted under the terms of a line of credit
agreement. Under this agreement, the Company can borrow funds
up to $100,000, payable on demand, with interest payable in
arrears at the rate of 5.68% per annum thru October 24, 2005.
Thereafter, the interest rate is 2% per annum above the
certificate of deposit rate of a certain bank. Borrowings
under this agreement are secured by an assignment of a
certificate deposit owned by the general partner, Stanley
Rosenthal. The balance outstanding at December 31, 2003 was
$50,000 and the interest expense was $482.
Page 9 (1 of 3)
ITEM 2 MANAGEMENT?S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Registrant?s source of working capital consists of
cash received from Tunicom. No cash was available for
distribution during the three months ended December 31, 2003.
Presently, the cash flow that becomes available for distribution
will be distributed as follows:
3.49% to the non-partner distributees
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 Company)
100.00%
As previously reported, Tunicom L.L.C. (?Tunicom?)
sold the adult retirement community known as Forest Trace and
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 $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
Page 9 (2 of 3)
ITEM 2 MANAGEMENT?S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
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.
ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
None.
ITEM 4 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) 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.
Page 9 (3 of 3)
ITEM 4 CONTROLS AND PROCEDURES (CONTINUED)
(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.
Page 10
CONDENSED FINANCIAL INFORMATION FOR REAL ESTATE PARTNERSHIP
TUNICOM LLC
CONDENSED BALANCE SHEET
AS OF DECEMBER 31, 2003 AND JUNE 30, 2003
(UNAUDITED)
DECEMBER JUNE
31, 2003 30, 2003
ASSETS:
Land and development costs $ 790,664 $ 783,253
Cash 5,543 31,773
Notes receivable and accrued interest
-related party - 10,225
Prepaid expenses 30,025 30,025
Total $ 826,232 $ 855,276
LIABILITIES AND PARTNERS' CAPITAL:
Accounts payable and other
liabilities $ 35,688 $ 26,118
Partners' capital 790,544 829,158
Total $ 826,232 $ 855,276
See accompanying notes and accountant?s review report.
Page 11
CONDENSED FINANCIAL INFORMATION FOR REAL ESTATE PARTNERSHIP
TUNICOM LLC
CONDENSED PROFIT AND LOSS INFORMATION
THREE MONTHS AND SIX MONTHS ENDED
DECEMBER 31, 2003 AND 2002
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
2 0 0 3 2 0 0 2 2 0 0 3 2 0 0 2
REVENUES:
Interest and other $ 47 $ 175 $ 205 $ 428
Total income $ 47 $ 175 $ 205 $ 428
EXPENSES:
General and
administrative $ 34,759 $ 9,192 $ 38,819 $ 14,794
Taxes and insurance - 2,573 - 5,573
Total expenses $ 34,759 $ 11,765 $ 38,819 $ 20,367
NET PROFIT (LOSS) $ (34,712) $ (11,590) $ (38,614) $ (19,939)
See accompanying notes and accountant?s review report.
Page 12
ALL-STATE PROPERTIES L.P.
(A LIMITED PARTNERSHIP)
EXHIBIT - COMPUTATION OF INCOME (LOSS) PER PARTNERSHIP UNIT
SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002
2 0 0 3 2 0 0 2
Partnership units outstanding 3,118,303 3,118,303
Net (Loss) Income $ (35,725) $ (33,612)
Net (Loss) Income Per Partnership
Unit $ (0.00) $ (0.01)
See accompanying notes and accountant?s review report.
Page 13
ALL-STATE PROPERTIES L.P.
PART II - OTHER INFORMATION
ITEM 1 ? Legal Proceedings
None.
ITEM 2 - Changes in Securities and Use of Proceeds
There were no changes in the right of limited partners
during the quarter covered by this report.
ITEM 3 - Defaults Upon Senior Securities
There were no defaults by Registrant on its senior
securities during the quarter covered by this report.
ITEM 4 - Submission of Matters to Vote of Security Holders
No matters were submitted during the quarter covered by
this report to a vote of limited partners.
ITEM 5 ? Other Information
None.
ITEM 6 - Exhibits and Reports on Form 8-K
(a) Exhibit - Computation of earnings per partnership
unit.
(b) Exhibit - Form 8-K filed October 8, 1999,
incorporated by reference.
(c) Exhibit ? Form 8-K filed August 16, 2000.
Page 14
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of
1934, 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 ROSENTHAL
General Partner
Dated: January 28, 2004
Page 15 (1 of 2)
ALL-STATE PROPERTIES L.P.
CERTIFICATIONS
I, Stanley Rosenthal, certify that:
1. I have reviewed this quarterly report on Form 10-Q of All-
State Properties L.P.;
2. Based on my knowledge, this quarterly 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
quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly 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
quarterly 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 we 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 quarterly 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 quarterly report (the
?Evaluation Date?); and
c) presented in this quarterly report our conclusions about
the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation
Date;
Page 15 (2 of 2)
ALL-STATE PROPERTIES L.P.
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 quarterly 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: January 28, 2004
_____________________
Stanley Rosenthal
General Partner
Page 16
CERTIFICATION PURSUANT TO
18 U.S.C SECTON 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of All-State
Properties L.P. (the ?Company?) on Form 10-Q for the three months
ended December 31, 2003, as filed with the Securities and
Exchange Commission on the date hereof (the ?Report?), I, Stanley
Rosenthal, General Partner of the Company, certify, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
The Report fully complies with the requirements of
section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
The information contained in the Report fairly
presents, in all material respects, the financial condition and
results of operations of the Company.
Date: January 28, 2004
_____________________
Stanley Rosenthal
General Partner