UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- ------- EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2003
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- ------- EXCHANGE ACT OF 1934
Commission File Number 33-37704-03
INDEPENDENCE TAX CREDIT PLUS L.P. II
------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3646846
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
625 Madison Avenue, New York, New York 10022
- ---------------------------------------- --------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212)421-5333
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 by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).
Yes No X
----- -----
PART I - Financial Information
Item 1. Financial Statements
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)
============ ============
December 31, March 31,
2003 2003
------------ ------------
ASSETS
Property and equipment at cost,
net of accumulated depreciation
of $29,326,196 and $26,736,066,
respectively $ 80,142,195 $ 82,509,050
Cash and cash equivalents 723,316 992,367
Cash held in escrow 3,219,829 3,032,158
Deferred costs, net of accumulated
amortization of $180,775 and
$168,685, respectively 214,337 226,427
Other assets 659,502 742,400
------------ ------------
Total assets $ 84,959,179 $ 87,502,402
============ ============
2
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)
(continued)
============ ============
December 31, March 31,
2003 2003
------------ ------------
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Liabilities:
Mortgage notes payable $ 57,202,154 $ 57,603,476
Accounts payable and other
liabilities 1,337,721 1,333,488
Accrued interest 13,000,265 12,031,123
Due to local general partners and
affiliates 1,510,999 1,617,113
Due to general partner and
affiliates 3,988,445 3,507,307
------------ ------------
Total liabilities 77,039,584 76,092,507
------------ ------------
Minority interest (405,849) (343,717)
------------ ------------
Commitments and contingencies (Note 3)
Partners' capital (deficit):
Limited partners (58,928 BACs
issued and outstanding) 8,766,140 12,160,026
General partner (440,696) (406,414)
------------ ------------
Total partners' capital (deficit) 8,325,444 11,753,612
------------ ------------
Total liabilities and partners'
capital (deficit) $ 84,959,179 $ 87,502,402
============ ============
See accompanying notes to consolidated financial statements.
3
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
============================ ============================
Three Months Ended Nine Months Ended
December 31, December 31,
---------------------------- ----------------------------
2003 2002 2003 2002
---------------------------- ----------------------------
Revenues
Rental income $ 2,274,211 $ 2,210,730 $ 6,819,913 $ 6,550,673
Other income 55,126 47,962 142,384 136,654
------------ ------------ ------------ ------------
Total revenues 2,329,337 2,258,692 6,962,297 6,687,327
------------ ------------ ------------ ------------
Expenses
General and
administrative 569,150 517,705 1,713,752 1,561,936
General and
administrative-
related parties
(Note 2) 250,732 244,626 746,885 738,338
Repairs and
maintenance 529,536 516,023 1,663,989 1,376,042
Operating 237,059 214,316 793,302 663,825
Taxes 178,159 167,693 538,640 523,907
Insurance 134,176 103,838 482,455 341,677
Financial 844,483 806,228 1,860,184 1,841,890
Depreciation
and amortization 893,357 865,596 2,602,220 2,607,434
------------ ------------ ------------ ------------
Total expenses 3,636,652 3,436,025 10,401,427 9,655,049
------------ ------------ ------------ ------------
Loss before
minority interest (1,307,315) (1,177,333) (3,439,130) (2,967,722)
Minority interest
in loss of subsidiary
partnerships 3,592 1,946 10,962 7,292
------------ ------------ ------------ ------------
Net loss $ (1,303,723) $ (1,175,387) $ (3,428,168) $ (2,960,430)
============ ============ ============ ============
Net loss-limited
partners $ (1,290,685) $ (1,163,633) $ (3,393,886) $ (2,930,826)
============ ============ ============ ============
Number of BACs
outstanding 58,928 58,928 58,928 58,928
============ ============ ============ ============
Net loss per BAC $ (21.90) $ (19.75) $ (57.59) $ (49.74)
============ ============ ============ ============
See accompanying notes to consolidated financial statements.
4
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Consolidated Statement of Changes in
Partners' Capital (Deficit)
(Unaudited)
=============================================
Limited General
Total Partners Partner
---------------------------------------------
Partners' capital
(deficit) -
April 1, 2003 $ 11,753,612 $ 12,160,026 $ (406,414)
Net loss (3,428,168) (3,393,886) (34,282)
------------ ------------ -------------
Partners' capital
(deficit) -
December 31, 2003 $ 8,325,444 $ 8,766,140 $ (440,696)
============ ============ ============
See accompanying notes to consolidated financial statements.
5
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Decrease) Increase in Cash and Cash Equivalents
(Unaudited)
============================
Nine Months Ended
December 31,
-----------------------------
2003 2002
-----------------------------
Cash flows from operating activities:
Net loss $(3,428,168) $(2,960,430)
----------- -----------
Adjustments to reconcile net loss to
net cash provided by operating
activities:
Depreciation and amortization 2,602,220 2,607,434
Minority interest in loss of subsidiaries (10,962) (7,292)
Decrease in cash held in
escrow 18,118 292,523
Decrease (increase) in other assets 82,898 (171,363)
Increase (decrease) in accounts
payable and other liabilities 4,233 (55,523)
Increase in accrued interest 969,142 897,989
Increase in due to local general
partners and affiliates 32,501 35,787
Decrease in due to local general
partners and affiliates (14,429) (21,349)
Increase in due to
general partner and affiliates 481,138 501,687
----------- -----------
Total adjustments 4,164,859 4,079,893
----------- -----------
Net cash provided by operating
activities 736,691 1,119,463
----------- -----------
Cash flows from investing activities:
Improvements to property and
equipment (223,275) (366,123)
Increase in cash held
in escrow (205,789) (411,594)
Increase in due to local general
partners and affiliates 11,355 207,760
Decrease in due to local general
partners and affiliates (63,925) 0
----------- -----------
Net cash used in investing activities (481,634) (569,957)
----------- -----------
6
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Decrease) Increase in Cash and Cash Equivalents
(Unaudited)
(continued)
============================
Nine Months Ended
December 31,
-----------------------------
2003 2002
-----------------------------
Cash flows from financing activities:
Principal payments of mortgage notes (401,322) (361,374)
Decrease in due to local general
partner and affiliates (71,616) (119,472)
Decrease in capitalization of
consolidated subsidiaries attributable
to minority interest (51,170) 0
----------- -----------
Net cash used in financing activities (524,108) (480,846)
----------- -----------
Net (decrease) increase in cash and
cash equivalents (269,051) 68,660
Cash and cash equivalents at
beginning of period 992,367 1,294,481
----------- -----------
Cash and cash equivalents at
end of period $ 723,316 $ 1,363,141
=========== ===========
See accompanying notes to consolidated financial statements.
7
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2003
(Unaudited)
Note 1 - General
The consolidated financial statements include the accounts of Independence Tax
Credit Plus L.P. II (the "Partnership") and 15 other limited partnerships
("subsidiary partnerships", "subsidiaries" or "Local Partnerships") owning
leveraged apartment complexes that are eligible for the low-income housing tax
credit. The general partner of the Partnership is Related Independence
Associates L.P., a Delaware limited partnership (the "General Partner"). Through
the rights of the Partnership and/or an affiliate of the General Partner, which
affiliate has a contractual obligation to act on behalf of the Partnership, to
remove the general partner of the subsidiary local partnerships and to approve
certain major operating and financial decisions, the Partnership has a
controlling financial interest in the subsidiary partnerships.
For financial reporting purposes, the Partnership's fiscal quarter ends December
31, 2003. All subsidiaries have fiscal quarters ending September 30, 2003.
Accounts of the subsidiaries have been adjusted for intercompany transactions
from October 1 through December 31. The Partnership's fiscal quarter ends
December 31 in order to allow adequate time for the subsidiaries financial
statements to be prepared and consolidated.
All intercompany accounts and transactions with the subsidiary partnerships have
been eliminated in consolidation.
Increases (decreases) in the capitalization of consolidated subsidiaries
attributable to minority interest arise from cash contributions from and cash
distributions to the minority interest partners.
Losses attributable to minority interests which exceed the minority interests'
investment in a subsidiary partnership have been charged to the Partnership.
Such losses aggregated approximately $8,000 and $8,000 and $18,000 and $17,000
for the three and nine months ended December 31, 2003 and 2002, respectively.
The Partnership's investment in each subsidiary is equal to the respective
subsidiary's partners' equity less minority interest capital, if any. Losses
attributable to minority interests which exceed the minority interests'
8
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2003
(Unaudited)
investment in a subsidiary partnership have been charged to the Partnership. In
consolidation, all subsidiary partnership losses are included in the
Partnership's capital account except for losses allocated to minority interest
capital.
Certain information and note disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been omitted or condensed. These condensed financial statements should be
read in conjunction with the financial statements and notes thereto included in
the Partnership's Annual Report on Form 10-K for the year ended March 31, 2003.
The books and records of the Partnership are maintained on the accrual basis of
accounting in accordance with generally accepted accounting principles. In the
opinion of the General Partner of the Partnership, the accompanying unaudited
financial statements contain all adjustments (consisting only of normal
recurring adjustments) necessary to present fairly the financial position of the
Partnership as of December 31, 2003, the results of operations for the three and
nine months ended December 31, 2003 and 2002 and cash flows for the nine months
ended December 31, 2003 and 2002, respectively. However, the operating results
for the nine months ended December 31, 2003 may not be indicative of the results
for the year.
9
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2003
(Unaudited)
Note 2 - Related Party Transactions
An affiliate of the General Partner has a .01% interest as a special limited
partner in each of the Local Partnerships.
The costs incurred to related parties for the three and nine months ended
December 31, 2003 and 2002 were as follows:
Three Months Ended Nine Months Ended
December 31, December 31,
-----------------------------------------
2003 2002 2003 2002
-----------------------------------------
Partnership management
fees (a) $136,500 $136,500 $409,500 $409,500
Expense reimbursement (b) 31,036 26,842 87,085 84,985
Local administrative fee (c) 8,000 8,000 24,000 24,000
-------- -------- -------- --------
Total general and admini-
strative-General Partner 175,536 171,342 520,585 518,485
Property management fees
incurred to affiliates of
the subsidiary partner-
ships' general partners (d) 75,196 73,284 226,300 219,853
-------- -------- -------- --------
Total general and admini-
strative-related parties $250,732 $244,626 $746,885 $738,338
======== ======== ======== ========
(a) The General Partner is entitled to receive a partnership management fee,
after payment of all Partnership expenses, which together with the annual local
administrative fees will not exceed a maximum of 0.5% per annum of invested
assets (as defined in the Partnership Agreement), for administering the affairs
of the Partnership. Subject to the foregoing limitation, the partnership
management fee will be determined by the General Partner in its sole discretion
based upon its review of the Partnership's investments. Unpaid partnership
management fees for any year will be accrued without interest and will be
payable from working capital reserves or to the extent of available funds after
the Partnership has made distributions to the limited partners of sale or
refinancing proceeds equal to their original capital contributions plus a 10%
priority return thereon (to the extent not theretofore paid out of cash flow).
Partnership management fees owed to the General Partner amounting to
approximately $3,202,000 and $2,793,000 were accrued and unpaid as of December
10
INDEPENDENCE TAX CREDIT PLUS L.P. II
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2003
(Unaudited)
31, 2003 and March 31, 2003, respectively. Without the General Partner's
advances and continued accrual without payment of certain fees and expense
reimbursements, the Partnership will not be in a position to meet its
obligations. The General Partner has continued to advance and allow the accrual
without payment of these amounts but is under no obligation to continue to do
so.
(b) The Partnership reimburses the General Partner and its affiliates for actual
Partnership operating expenses incurred by the General Partner and its
affiliates on the Partnership's behalf. The amount of reimbursement from the
Partnership is limited by the provisions of the Partnership Agreement. Another
affiliate of the General Partner performs asset monitoring for the Partnership.
These services include site visits and evaluations of the subsidiary
partnerships' performance.
(c) Independence SLP L.P., a special limited partner of the subsidiary
partnerships, is entitled to receive a local administrative fee of up to $5,000
per year from each subsidiary partnership.
(d) Property management fees incurred by the Local Partnerships amounted to
$147,213 and $160,495 and $493,095 and $475,654 for the three and nine months
ended December 31, 2003 and 2002, respectively. Of these fees, $75,196 and
$73,284 and $226,300 and $219,853 were incurred to affiliates of the subsidiary
partnerships' general partners.
Note 3 - Commitments and Contingencies
There were no material changes and/or additions to disclosures regarding the
subsidiary partnerships which were included in the Partnership's Annual Report
on Form 10-K for the year ended March 31, 2003.
11
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources
- -------------------------------
The Partnership's primary source of funds include working capital reserves,
interest earned on working capital reserves and distributions received from the
Local Partnerships. However, none of these sources provides a material amount of
funds.
As of December 31, 2003, the Partnership has invested all of its net proceeds in
fifteen Local Partnerships. Approximately $282,000 of the purchase price remains
to be paid to the Local Partnerships (including approximately $24,000 being held
in escrow).
For the nine months ended December 31, 2003, cash and cash equivalents of the
Partnership and its fifteen consolidated Local Partnerships decreased
approximately $269,000. This decrease is due to improvements in property and
equipment ($223,000), principal payments of mortgage notes ($401,000), an
increase in cash held in escrow relating to investing activities ($206,000), a
net decrease in due to local general partners and affiliates relating to
investing and financing activities ($124,000), and a decrease in capitalization
of consolidated subsidiaries attributable to minority interest ($51,000) which
exceeded cash provided by operating activities ($737,000). Included in the
adjustments to reconcile the net loss to cash provided by operating activities
is depreciation and amortization ($2,602,000).
At December 31, 2003, there was approximately $76,000 in the working capital
reserves. For the nine months ended December 31, 2003, the Partnership did not
receive any distributions from the Local Partnerships. Management anticipates
receiving distributions in the future, although not to a level sufficient to
permit providing cash distributions to the BACs holders. These distributions, if
any, as well as the working capital reserves referred to above and the deferral
of fees by the General Partner referred to below, will be used to meet the
operating expenses of the Partnership.
Partnership management fees owed to the General Partners amounting to
approximately $3,202,000 and $2,793,000 were accrued and unpaid as of December
31, 2003 and March 31, 2003, respectively. Without the General Partner's
advances and continued accrual without payment of certain fees and expense
reimbursements, the Partnership will not be in a position to meet its
obligations. The General Partner has continued to advance and allow the accrual
without payment of these amounts but is under no obligation to continue to do so
(see Note 2).
12
For a discussion of contingencies affecting certain Local Partnerships, see Note
3 to the financial statements. Since the maximum loss the Partnership would be
liable for is its net investment in the respective Local Partnerships, the
resolution of the existing contingencies is not anticipated to impact future
results of operations, liquidity or financial condition in a material way.
However, the Partnership's loss of its investment in a Local Partnership will
eliminate the ability to generate future Tax Credits from such Local Partnership
and may also result in recapture of Tax Credits, if the investment is lost
before the expiration of the compliance period.
Management is not aware of any trends or events, commitments or uncertainties
which have not otherwise been disclosed that will or are likely to impact
liquidity in a material way. Management believes the only impact would be from
laws that have not yet been adopted. The portfolio is diversified by the
location of the properties around the United States so that if one area of the
country is experiencing downturns in the economy, the remaining properties in
the portfolio may be experiencing upswings. However, the geographic
diversification of the portfolio may not protect against a general downturn in
the national economy. The Partnership has fully invested the proceeds of its
offering in fifteen Local Partnerships, all of which fully have their Tax
Credits in place. The Tax Credits are attached to the property for a period of
ten years, and are transferable with the property during the remainder of such
ten-year period. If trends in the real estate market warranted a sale of a
property, the remaining Tax Credits would transfer to the new owner, thereby
adding value to the property on the market. However, such value declines each
year and is not included in the financial statement carrying amount.
Critical Accounting Policies
- ----------------------------
The preparation of consolidated financial statements requires management to make
estimates and assumptions. These estimates and assumptions affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the consolidated financial statements and the
reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates. The following is a summary of certain
accounting estimates considered critical by the Partnership.
Property and Equipment
- ----------------------
Property and equipment to be held and used are carried at cost which includes
the purchase price, acquisition fees and expenses, construction period interest
and any other costs incurred in acquiring the properties. The cost of property
and equipment is depreciated over their estimated useful lives using accelerated
and straight-line methods. Expenditures for repairs and maintenance are charged
to expense as incurred; major renewals and betterments are capitalized. At the
time property and equipment are retired or otherwise disposed of, the cost and
13
accumulated depreciation are eliminated from the assets and accumulated
depreciation accounts and the profit or loss on such disposition is reflected in
earnings. The Partnership complies with Statement of Financial Accounting
Standards (SFAS) No. 144 "Accounting for the Impairment or Disposal of
Long-Lived Assets". A loss on impairment of assets is recorded when management
estimates amounts recoverable through future operations and sale of the property
on an undiscounted basis is below depreciated cost. At that time, property
investments themselves are reduced to estimated fair value (generally using
discounted cash flows).
Income Taxes
- ------------
The Partnership is not required to provide for, or pay, any federal income
taxes. Net income or loss generated by the Partnership is passed through to the
partners and is required to be reported by them. The Partnership may be subject
to state and local taxes in jurisdictions in which it operates. For income tax
purposes, the Partnership has a fiscal year ending December 31.
New Accounting Pronouncements
- -----------------------------
In January 2003, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 46, "Consolidation of Variable Interest Entities" ("FIN 46").
FIN 46 is applicable immediately for variable interest entities created after
January 31, 2003. For variable interest entities created before February 1,
2003, the provisions of FIN 46 are applicable no later than December 15, 2003.
The Partnership has not created any variable interest entities after January 31,
2003. In December 2003 the FASB redeliberated certain proposed modifications and
revised FIN 46 ("FIN 46 (R)"). The revised provisions are applicable no later
than the first reporting period ending after March 15, 2004. The adoption of FIN
46 and FIN 46 (R) is not anticipated to have a material impact on the
Partnership's financial reporting and disclosures.
In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity". SFAS No. 150
changes the accounting for certain financial instruments that, under previous
guidance, could be classified as equity or "mezzanine" equity, by now requiring
those instruments to be classified as liabilities ( or assets in some
circumstances) in the Consolidated Balance Sheets. Further, SFAS No. 150
requires disclosure regarding the terms of those instruments and settlement
14
alternatives. The guidance in SFAS No. 150 generally was effective for all
financial instruments entered into or modified after May 31, 2003, and was
otherwise effective at the beginning of the first interim period beginning after
June 15, 2003. The Partnership has evaluated SFAS No. 150 and determined that it
does not have an impact on the Partnership's financial reporting and
disclosures.
Results of Operations
- ---------------------
The Partnership's results of operations for the three and nine months ended
December 31, 2003 and 2002 consisted primarily of the results of the
Partnership's investment in fifteen consolidated Local Partnerships. The
majority of Local Partnership income continues to be in the form of rental
income with the corresponding expenses being divided among operations,
depreciation and mortgage interest.
Rental income increased approximately 3% and 4% for the three and nine months
ended December 31, 2003 as compared to the corresponding periods in 2002,
primarily due to rental rate increases.
Total expenses, excluding repairs and maintenance, operating and insurance,
remained fairly consistent with increases of approximately 5% and 3% for the
three and nine months ended December 31, 2003 as compared to the corresponding
periods in 2002.
Repairs and maintenance increased approximately $288,000 for the nine months
ended December 31, 2003 as compared to the corresponding period in 2002,
primarily due to increased repairs and maintenance payroll at two Local
Partnerships and upgrades in appliances, painting and carpeting at a third Local
Partnership in the first quarter.
Operating expenses increased approximately $23,000 and $129,000 for the three
and nine months ended December 31, 2003 as compared to the corresponding periods
in 2002, primarily due to an utility refund received at one Local Partnership in
2002 and an underaccrual of gas expense in 2002 at a second Local Partnership.
Insurance increased approximately $30,000 and $141,000 for the three and nine
months ended December 31, 2003 as compared to the corresponding periods in 2002,
primarily due to increased premiums at the Local Partnerships.
15
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
- ------------------------------------------------
The Chief Executive Officer and Chief Financial Officer of Related Independence
Associates Inc., the general partner of Related Independence Associates L.P.,
which is the General Partner of the Partnership, have evaluated the
Partnership's disclosure controls and procedures (as such term is defined in
Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the
"Exchange Act")) as of December 31, 2003 (the "Evaluation Date"). Based on such
evaluation, such officers have concluded that, as of the Evaluation Date, the
Partnership's disclosure controls and procedures are effective in alerting them,
on a timely basis, to material information relating to the Partnership required
to be included in the Partnership's reports filed or submitted under the
Exchange Act .
Changes in Internal Control Over Financial Reporting
- ----------------------------------------------------------
There has been no significant change in the Partnership's internal control over
financial reporting during the Partnership's fiscal quarter ended December 31,
2003 which has materially affected, or is reasonably likely to materially
affect, such internal control over financial reporting .
16
PART II. OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities and Use of Proceeds - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
(3A) Agreement of Limited Partnership of Independence Tax
Credit Plus L.P. II as adopted on February 11, 1992*
(3B) Form of Amended and Restated Agreement of Limited
Partnership of Independence Tax Credit Plus L.P. II, attached to the Prospectus
as Exhibit A**
(3C) Certificate of Limited Partnership of Independence Tax
Credit Plus L.P. II as filed on February 11, 1992*
(10A) Form of Subscription Agreement attached to the Prospectus
as Exhibit B**
(10B) Escrow Agreement between Independence Tax Credit Plus L.P.
II and Bankers Trust Company*
(10C) Form of Purchase and Sales Agreement pertaining to the
Partnership's acquisition of Local Partnership Interests*
(10D) Form of Amended and Restated Agreement of Limited
Partnership of Local Partnerships*
31.1 Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a).
31.2 Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a).
32.1 Certification Pursuant to Rule 13a-14(b) or Rule 15d-14(b)
and Section 1350 of Title 18 of the United States Code (18 U.S.C. 1350).
17
32.2 Certification Pursuant to Rule 13a-14(b) or Rule 15d-14(b)
and Section 1350 of Title 18 of the United States Code (18 U.S.C. 1350).
* Incorporated herein as an exhibit by reference to exhibits
filed with Post-Effective Amendment No. 4 to the Registration Statement on Form
S-11 (Registration No. 33-37704)
** Incorporated herein as an exhibit by reference to
exhibits filed with Post-Effective Amendment No. 8 to the Registration Statement
on Form S-11 (Registration No. 33-37704)
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter.
18
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INDEPENDENCE TAX CREDIT PLUS L.P. II
------------------------------------
(Registrant)
By: RELATED INDEPENDENCE
ASSOCIATES L.P., General Partner
By: RELATED INDEPENDENCE
ASSOCIATES INC., General Partner
Date: January 30, 2004
By: /s/ Alan P. Hirmes
------------------
Alan P. Hirmes,
Senior Vice President
(principal financial officer)
Date: January 30, 2004
By: /s/ Glenn F. Hopps
------------------
Glenn F. Hopps,
Treasurer
(principal accounting officer)
Exhibit 31.1
CERTIFICATION PURSUANT TO RULE
13a-14(a) OR RULE 15d-14(a)
I, Michael Brenner, Chief Executive Officer of Related Independence Associates
Inc. ("RIAI") the general partner of Related Independence Associates L.P. the
General Partner of Independence Tax Credit Plus L.P. II (the "Partnership"),
hereby certify that:
1. I have reviewed this quarterly report on Form 10-Q for the period
ending December 31, 2003 of the Partnership;
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 in order 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 Partnership as of, and for, the periods presented in
this quarterly report;
4. I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over financial reporting (as defined in
Exchange Act Rues 13a-15(f) and 15d-15(f)) for the Partnership and I
have:
a) designed such disclosure controls and procedures or caused such
disclosure controls and procedures to be designed under my supervision,
to ensure that material information relating to the Partnership
including its consolidated subsidiaries, is made known to me by others
within those entities, particularly during the period in which this
quarterly report was being prepared;
b) designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under my
supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting
principles; and
c) evaluated the effectiveness of the Partnership's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures as of the end
of the period covered by this quarterly report based on such
evaluation; and
d) disclosed in this quarterly report any change in the Partnership's
internal control over financial reporting that occurred during the
period ending December 31, 2003 that has materially affected, or is
reasonably likely to materially affect, the Partnership's internal
control over financial reporting; and
5. I have disclosed, based on my most recent evaluation of internal
control over financial reporting, to the Partnership's auditors and to
the boards of directors of the General Partners:
a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the Partnership's ability to
record, process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Partnership's
internal control over financial reporting.
Date: January 30, 2004
----------------
By: /s/ Michael Brenner
-------------------
Michael Brenner
Chief Executive Officer
Exhibit 31.2
CERTIFICATION PURSUANT TO RULE
13a-14(a) OR RULE 15d-14(a)
I, Alan P. Hirmes, Chief Financial Officer of Related Independence Associates
Inc. ("RIAI") the general partner of Related Independence Associates L.P. the
General Partner of Independence Tax Credit Plus L.P. II (the "Partnership"),
hereby certify that:
1. I have reviewed this quarterly report on Form 10-Q for the period
ending December 31, 2003 of the Partnership;
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 in order 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 Partnership as of, and for, the periods presented in
this quarterly report;
4. I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over financial reporting (as defined in
Exchange Act Rues 13a-15(f) and 15d-15(f)) for the Partnership and I
have:
a) designed such disclosure controls and procedures or caused such
disclosure controls and procedures to be designed under my supervision,
to ensure that material information relating to the Partnership
including its consolidated subsidiaries, is made known to me by others
within those entities, particularly during the period in which this
quarterly report was being prepared;
b) designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under my
supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting
principles; and
c) evaluated the effectiveness of the Partnership's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures as of the end
of the period covered by this quarterly report based on such
evaluation; and
d) disclosed in this quarterly report any change in the Partnership's
internal control over financial reporting that occurred during the
period ending December 31, 2003 that has materially affected, or is
reasonably likely to materially affect, the Partnership's internal
control over financial reporting; and
5. I have disclosed, based on my most recent evaluation of internal
control over financial reporting, to the Partnership's auditors and to
the boards of directors of the General Partners:
a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the Partnership's ability to
record, process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Partnership's
internal control over financial reporting.
Date: January 30, 2004
----------------
By: /s/ Alan P. Hirmes
------------------
Alan P. Hirmes
Chief Financial Officer
Exhibit 32.1
CERTIFICATION PURSUANT
TO RULE 13a-14(b) OR RULE 15d-14(b)
AND SECTION 1350 OF TITLE 18
OF THE UNITED STATES CODE (18 U.S.C. 1350)
In connection with the Quarterly Report of Independence Tax Credit Plus L.P. II
(the "Partnership") on Form 10-Q for the period ending December 31, 2003 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Michael Brenner, Chief Executive Officer of Related Independence
Associates Inc. the general partner of Related Independence Associates L.P., the
General Partner of the Partnership, certify, pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
By: /s/ Michael Brenner
-------------------
Michael Brenner
Chief Executive Officer
January 30, 2004
Exhibit 32.2
CERTIFICATION PURSUANT
TO RULE 13a-14(b) OR RULE 15d-14(b)
AND SECTION 1350 OF TITLE 18
OF THE UNITED STATES CODE (18 U.S.C. 1350)
In connection with the Quarterly Report of Independence Tax Credit Plus L.P. II
(the "Partnership") on Form 10-Q for the period ending December 31, 2003 as
filed with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Alan P. Hirmes, Chief Financial Officer of Related Independence
Associates Inc. the general partner of Related Independence Associates L.P., the
General Partner of the Partnership, certify, pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
By: /s/ Alan P. Hirmes
------------------
Alan P. Hirmes
Chief Financial Officer
January 30, 2004