10-Q 1 realmarkiv_10q.txt QUARTERLY REPORT FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2001 Commission File Number: 0-14386 REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP IV -------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 16-1245153 -------------------------- ----------------------------------------- (State of organization) (IRS Employer Identification No.) 2350 North Forest Road, Suite 12A,Getzville, New York 14068 ----------------------------------------------------------- (Address of principal executive offices) (716) 636-0280 -------------- (Registrant's telephone number) Indicate by a 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 [ ] Item 1. Financial Statements Condensed Consolidated Balance Sheets -------------------------------------

Condensed Consolidated Statements of Operations -----------------------------------------------

2 Condensed Consolidated Statements of Cash Flows -----------------------------------------------

Notes to Financial Statements September 30, 2001 and 2000 Organization ------------ Realmark Property Investors Limited Partnership - IV (the Partnership), a Delaware limited partnership, was formed on February 12, 1985, to invest in a diversified portfolio of income producing real estate investments. The general partners are Realmark Properties, Inc. (the corporate general partner) and Joseph M. Jayson (the individual general partner). Joseph M. Jayson is the sole stockholder of J.M. Jayson & Company Inc. Realmark Properties, Inc. is a wholly-owned subsidiary of J.M. Jayson & Company, Inc. Under the partnership agreement, the general partners and their affiliates can receive compensation for services rendered and reimbursement for expenses incurred on behalf of the Partnership. Basis of Presentation --------------------- The accompanying interim financial statements have been prepared in accordance with generally accepted accounting principles and, in the opinion of management, contain all necessary adjustments for a fair presentation, on a going concern basis. However, the Partnership will be dissolved in the near future since it sold its one remaining property in the third quarter of 2001. If the Court approves the settlement of the lawsuit as described in the contingency note below, none of the payable to affiliated parties will be paid and that amount will be effectively converted to capital upon dissolution. The Partnership's significant accounting policies are set forth in its December 31, 2000 Form 10-K. The interim financial statements should be read in conjunction with the financial statements included therein. The interim results should not be considered indicative of the annual results. Certain 3 reclassifications of prior period numbers may have been made to conform to the current period presentation. Property and Equipment ---------------------- Since 1998, the Partnership's only property, the Andover Park apartment complex, has been actively marketed for sale. Depreciation expense not recorded in each of the 2001 and 2000 three and nine month periods was approximately $44,000 and $130,000. In its March 31, 2001 and June 30, 2001 Form 10-Qs, the Partnership reported the existence of a contingent sales agreement covering Andover Park. On August 16, 2001, the sale was consummated with an unaffiliated entity, Andover Park Apartments Limited Partnership, for cash of $5.2 million, resulting in a net gain of approximately $2.4 million. In 2000 and 2001, the results of operations of the Partnership were the same as the results of Andover Park's operations plus administrative expenses of the Partnership. Therefore, presentation of pro forma data is inapplicable. Contingency ----------- The Partnership, as a nominal defendant, the General Partners of all of the Realmark Partnerships and the officers and directors of the Corporate General Partner, as defendants, were served with a Summons and Complaint on April 7, 2000 in a class and derivative lawsuit instituted by Ira Gaines and on August 8, 2000 in a class and derivative lawsuit instituted by Sean O'Reilly and Louise Homburger, each in Supreme Court, County of Erie, State of New York (the"Court"). In September 2000, the Court signed an order consolidating these lawsuits. The consolidated lawsuit alleges claims of mismanagement and improper use of partnership funds relating to the Realmark Partnerships. The consolidated lawsuit seeks declaratory relief, unspecified damages, a receiver, an order liquidating the partnership, punitive damages, attorneys' fees and related relief. While the defendants deny any liability and have vigorously defended this lawsuit, on August 29, 2001, the parties entered into a Stipulation of Settlement (the "Agreement"). On October 4, 2001, the Court issued an "Order Preliminarily Approving Settlement" that, among other things, calls for a hearing on November 21, 2001 to determine whether the Agreement should be approved by the Court. The Agreement provides, among other things, that: * $1 million of the amount owed to the General Partners and/or their affiliates by Realmark Property Investors Limited Partnership IV be forgiven. * The payable to the General Partners and/or their affiliates by Realmark Property Investors Limited Partnership VI-A at March 31, 2001, in the amount of $481,598, cease to accrue interest. * All of the Realmark Partnerships' properties be disposed of within 360 days of the hearing order. The consolidated financial statements do not include any adjustments that might result from the outcome of this matter, pending the action of the Court. Current Accounting Pronouncements --------------------------------- Statements of Financial Accounting Standards Nos. 138 and 133, which concern accounting for derivative instruments and hedging activities, became effective for the Partnership on January 1, 2001 and did not have any effect on the Partnership's financial statements. 4 PART I - Item 2. Management's Discussion and Analysis of Financial Condition ----------------------------------------------------------- and Results of Operations ------------------------- Liquidity and Capital Resources ------------------------------- The net proceeds from the sale of the Andover Park property are in cash and equivalents at September 30, 2001. That balance will be used to pay the remaining trade liabilities of the Partnership with the remainder to be distributed to the limited partners in accordance with the Agreement described above in the contingency note to the financial statements. PART I - Item 3. Quantitative and Qualitative Disclosures About Market Risk ---------------------------------------------------------- The Partnership's cash equivalents are short-term, interest-bearing bank accounts. It has not entered into any derivative contracts. Therefore, it has no market risk exposure. PART II - Item 6 Exhibits and Reports on Form 8-K -------------------------------- On August 31, 2001, the Partnership filed a Form 8-K, reporting the sale of Andover Park under item 2 thereof. 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. REALMARK PROPERTY INVESTORS LIMITED PARTNERHIP IV November 14, 2001 /s/ Joseph M. Jayson ----------------- -------------------------------- Date Joseph M. Jayson, Individual General Partner and Principal Financial Officer 5

REALMARK PROPERTY INVESTORS LTD PARTNERSHIP-IV 10-Q