Document/Exhibit Description Pages Size
1: 8-K C:\Echo\125228.Doc 6± 23K
2: EX-4 Escher Sro Project, L.P. Limited Partnership 81± 304K
3: EX-10 Escher Sro Project, L.P. Certification and 19± 76K
Agreement
Washington, D.C. 20549
F O R M 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
September 12, 1997
BOSTON CAPITAL TAX CREDIT FUND IV L.P.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
33-70564 04-3208648
(Commission File Number) (IRS Employer Identification No.)
c/o Boston Capital Partners, Inc.,
One Boston Place, Boston, Massachusetts 02108-4406
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 624-8900
None
(Former name or former address, if changed since last report)
Item 5. Other Events
On September 12, 1997, Boston Capital Tax Credit Fund IV
L.P., a Delaware limited partnership, specifically Series 26
thereof (the "Partnership") completed various agreements relating
to Escher SRO Project, L.P. a New Jersey limited partnership
(the "Operating Partnership"), including an Amended and Restated
Agreement of Limited Partnership of the Operating Partnership
dated as of September 12, 1997 (the "Operating Partnership
Agreement"), pursuant to which the Partnership acquired a limited
partner interest in the Operating Partnership. Capitalized terms
used and not otherwise defined herein have their meanings set
forth in the Operating Partnership Agreement, a copy of which is
attached hereto as Exhibit (2)(a).
The Operating Partnership owns and operates a recently
renovated apartment complex located at 50 Escher Street, Trenton,
New Jersey, which is known as Escher Street SRO (the "Apartment
Complex"). The Apartment Complex consists of one building which
previously was a vacant factory building and now contains 104
units, of which 100 are single room occupancy residential units
and the remaining four (4) units are for use by the Apartment
Complex superintendent, the Manager and the maintenance staff.
The Apartment Complex is currently in the rent-up stage and is
expected to achieve 100% occupancy by April 30, 1998.
The Operating Partnership is receiving permanent financing
in the amount of $1,590,000 (the "City Loan") from the City of
Trenton, New Jersey (the "City"). The City Loan has a 16 year
term and accrues interest at 9% per annum with a pay rate of 7.5%
per annum. The Operating Partnership is also receiving a loan
from the City in the amount of $100,000 which is being used by
the Operating Partnership to fund a portion of the Operating
Deficit Reserve. The Operating Partnership is also receiving a
loan in the amount of $419,956 (the "Balanced Housing Loan") from
the Balanced Housing Development Corporation, the General Partner
of the Apartment Complex. The proceeds of the Balance Housing
Loan were received by the General Partner from Sovereign Bank,
F.S.B. under the Federal Home Loan Bank Board AHP Program and
were in turn loaned to the Operating Partnership by the General
Partner at the Applicable Federal Rate of interest over a 30-year
term. The Operating Partnership is also receiving a grant in
the amount of $399,791 from the New Jersey Housing and Mortgage
Finance Agency.
It is expected that 100% of the rental apartment units in
the Apartment Complex will qualify for the low-income housing tax
credit (the "Tax Credits") under Section 42 of the Internal
Revenue Code of 1986, as amended (the "Code").
The General Partner of the Operating Partnership is Balanced
Housing Development Corporation, a New Jersey corporation
(the "General Partner"). The General Partner is also serving as
the Developer of the Apartment Complex and an affiliate of
the General Partner, Fela, Inc. d/b/a Emet Realty Management and
Development Company, Inc. is serving as the Management Agent of
the Apartment Complex. Donald Brown is the President of both
the General Partner and the Management Agent. Mr. Brown has an
extensive background in accounting, mortgage banking,
construction, financing development and management of various
forms of real estate, including single room occupancy facilities.
The Partnership acquired its interest in the Operating
Partnership directly from the Operating Partnership in
consideration of an agreement to make a Capital Contribution of
$3,748,125 to the Operating Partnership in six (6) Installments
as follows:
I. $1,992,618 on the latest to occur of (A) Tax Credit Set
Aside, (B) Initial Closing, (C) receipt by Boston
Capital of an acceptable commitment of the City of
Trenton regarding the restructure of the City Loan, (D)
the Admission Date, or (E) receipt by Boston Capital of
an acceptable commitment for title insurance
(the "First Installment");
II. $805,507 on the latest to occur of (A) 75% Construction
Completion, as determined by Boston Capital, (B)
receipt of an owner's title insurance policy
satisfactory to the Special Limited Partner, (C)
confirmation by Boston Capital that each of
the itemized outstanding due diligence matters has been
completed by the General Partner to the reasonable
satisfaction of Boston Capital, or (D) receipt of a
payoff letter from the Contractor stating that all
amounts due and payable to the Contractor have been
paid in full and that the Operating Partnership is not
in violation of the Construction Contract, and
satisfaction of all of the conditions to the payment of
the First Installment (the "Second Installment");
III. $400,000 on the latest to occur of (A) Substantial
Completion, (B) State Designation or (C) Cost
Certification, and satisfaction of all of
the conditions to the payment of the First and Second
Installments (the "Third Installment");
IV. $220,000 on the later to occur of (A) Initial 95%
Occupancy Date (B) Final Closing or (C) First Rental
Achievement, and satisfaction of all conditions to
the payment of the First, Second and Third Installments
(the "Fourth Installment");
V. $320,000 upon (A) Second Rental Achievement and (B)
satisfaction of all conditions to the payment of
the First, Second, Third and Fourth Installments
(the "Fifth Installment"); and
VI. $10,000 upon (A) the receipt by the Partnership of
the Operating Partnership's federal income tax return
for the year in which Rental Achievement occurred and
(B) satisfaction of all conditions to the payment of
the First, Second, Third, Fourth and Fifth Installments
(the "Sixth Installment").
The total Capital Contribution of the Partnership to
the Operating Partnership is based on the Operating Partnership
receiving $5,949,400 of Tax Credits during the 10-year period
commencing in 1998 of which 99.99% ($5,948,805) will be allocated
to the Partnership as the Investment Limited Partner of
the Operating Partnership. The Special Limited Partner of
the Operating Partnership is BCTC 94, Inc., an affiliate of
the Partnership.
The Partnership believes that the Apartment Complex is
adequately insured.
Ownership interests in the Operating Partnership are as
follows, subject in each case to certain priority allocations and
distributions as set forth in the Operating Partnership
Agreement:
Normal Capital
Operations Transactions Cash Flow
General Partner 0.01% 50% 80%
Partnership 99.99% 50% 20%
The Partnership used the funds obtained from the payments of
the holders of its beneficial assignee certificates to make
the acquisition of its interest in the Operating Partnership.
The Operating Partnership shall pay to Boston Capital or an
affiliate thereof an annual Asset Management Fee in the amount of
$7,500 per annum, commencing in 1998, for services in connection
with the preparation of reports required pursuant to
Section 13.04 of the Operating Partnership Agreement. The Asset
Management Fee for each fiscal year will be payable from Cash
Flow; provided, however, that if in any fiscal year Cash Flow is
insufficient to pay all or any portion of the Asset Management
Fee the unpaid portion, shall accrue, without interest, and be
payable on a cumulative basis in the first year in which there is
sufficient Cash Flow or from the proceeds of a Capital
Transaction as provided in Article XI of the Operating
Partnership Agreement.
The Operating Partnership shall pay to the General Partner a
fee (the "Incentive Partnership Management Fee") commencing in
1998 (pro rata for 1997) for its services in connection with
the managing of the day to day business of the Operating
Partnership in an annual amount equal $7,500 per annum.
The Incentive Partnership Management Fee for each fiscal year of
the Operating Partnership shall be payable from Cash Flow to
the extent Cash Flow is available therefor for such year;
provided, however, that if in any fiscal year commencing with
1998 (pro rata for 1997), Cash Flow is insufficient to pay
the full amount of the Incentive Partnership Management Fee,
the unpaid portion thereof shall accrue, without interest, and be
payable on a cumulative basis in the first year in which there is
sufficient Cash Flow or from the proceeds of a Capital
Transaction as provided in Article XI of the Operating
Partnership Agreement.
In consideration of its consultation, advice and other
services in connection with the construction and development of
the Apartment Complex, the Operating Partnership shall pay to
the Developer a development fee (the "Development Fee") in
the total amount of $964,774. The Development Fee shall be
payable $86,549 from the proceeds of the First Installment,
$220,000 from the proceeds of the Fourth Installment, $320,000
from the proceeds of the Fifth Installment and $10,000 from
the proceeds of the Sixth Installment, with the unpaid balance of
$328,225 (the "Deferred Development Fee") payable as provided in
Article XI of the Operating Partnership Agreement.
The Management Agent for the Apartment Complex will receive a fee
equal to 8.5% of Total Operating Revenue of the Apartment Complex
with potential to increase to a maximum of 10% of Total Operating
Revenue of the Apartment Complex.
Item 7. Exhibits.
(c) Exhibits. Page
(1) (a)<F1> Form of Dealer-Manager Agreement between
Boston Capital Services, Inc. and
the Registrant (including, as an exhibit
thereto, the form of Soliciting Dealer
Agreement)
(2) (a) Amended and Restated Agreement of Limited
Partnership of Escher SRO Project, L.P.
(2) (b) Certification and Agreement relating to
Escher SRO Project, L.P.
(4) (a)2<F2> Agreement of Limited Partnership of
the Partnership
(16) None
(17) None
(21) None
(24) None
(25) None
(28) None
_______________
<F1> Incorporated by reference to Exhibit (1) to Registration
Statement No. 33-70564 on Form S-11, as filed with the
Securities and Exchange Commission.
<F2> Incorporated by reference to Exhibit (4) to Registration
Statement No. 33-70564 on Form S-11, as filed with the
Securities and Exchange Commission.
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 hereto duly authorized.
Dated: April 22, 1998
BOSTON CAPITAL TAX CREDIT FUND IV L.P.
By: Boston Capital Associates IV L.P.,
its General Partner
By: C&M Associates, d/b/a Boston
Capital Associates, its
General Partner
By: /s/ Herbert F. Collins
Herbert F. Collins, Partner
Dates Referenced Herein and Documents Incorporated by Reference
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