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SEC Filings

S-1/A
JONES LANG LASALLE INC filed this Form S-1/A on 07/03/1997
Entire Document
 
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            LA SALLE PARTNERS LIMITED PARTNERSHIP AND SUBSIDIARIES
 
       LA SALLE PARTNERS MANAGEMENT LIMITED PARTNERSHIP AND SUBSIDIARIES
 
                    NOTES TO COMBINED FINANCIAL STATEMENTS
                                (IN THOUSANDS)
 
                       (UNAUDITED AS TO INTERIM PERIODS)
 
(1) ORGANIZATION
 
  LaSalle Partners Limited Partnership ("LPL") and LaSalle Partners Management
Limited Partnership ("LPML"), two Delaware limited partnerships (collectively,
the "Partnerships"), were formed on June 29, 1988 to provide real estate
services to clients including leasing, brokerage, construction and development
management, real property asset management and real estate investment advice.
Prior to June 29, 1988, these real estate services were provided by the
general partners of the Partnerships, DEL-LPL Limited Partnership and DEL-
LPAML Limited Partnership (collectively "DEL"), respectively. Previous to
January 23, 1995, LPML transacted business under the name of LaSalle Partners
Asset Management Limited.
 
  Prior to November 30, 1994, the sole limited partners of LPL and LPML were
DSA-LSPL, Inc. and DSA-LSAM, Inc. (collectively "DSA"), respectively. On that
date, the Partnerships admitted Alex. Brown Kleinwort Benson Realty Advisors
Corporation ("ABKB") as an additional limited partner (note 3). Effective
March 31, 1995, ABKB changed its name to KB-LPL, Inc. DEL, DSA and KB-LPL,
Inc. had ownership interests of 55.6%, 24.4% and 20.0%, respectively, at
December 31, 1995 and 1996.
 
  In August 1995, Dresdner Bank AG ("Dresdner") purchased the parent company
of KB-LPL, Inc. As a result of bank regulatory requirements, Dresdner was
required to sell its interests in the Partnerships. Pursuant to an agreement
reached with Dresdner in May, 1996, DEL re-purchased KB-LPL, Inc.'s ownership
in the Partnerships during the first quarter of 1997.
 
  Under the provisions of the partnership agreements, LPL and LPML partnership
interests are paired on a one-for-one basis and may only be purchased or sold
in tandem. Partnership interests in DEL are also paired on a one-for-one
basis. Further, the partnership agreements provide for changes in ownership
interests. DEL has the right to increase their ownership interest by making
additional capital contributions to the Partnerships. Such additional capital
would be used by the Partnerships to repay subordinated notes payable,
including Class A and Class B notes, to DSA (note 7). If DEL does not exercise
their right, DSA has the right to convert any unpaid principal on the
subordinated notes into an additional capital contribution thus increasing
their ownership interests (note 7). Provisions in the partnership agreements
provide for the repayment of the Class A notes payable to DSA to be made
directly by the Partnerships.
 
  The Partnerships' net cash flow, after appropriate reserves, is generally
distributed to the partners in accordance with their ownership interests. The
partnership agreements permit distributions during each year to the partners
in connection with estimated federal income tax payments owed by the partners.
Net profits and losses of the Partnerships are generally allocated to the
partners in accordance with their ownership interests in effect during each
year.
   
  The Partnerships expect to be subject to a reorganization as part of the
Incorporation Transactions of LaSalle Partners Incorporated ("LPI"). Due to
the existence of a paired share arrangement between LPL and LPML and between
the DEL partnerships, as well as the existence of identical ownership before
and after the Incorporation Transactions, such transactions are expected to be
accounted for in a manner similar to the accounting used for a pooling of
interests. Thus, LPI's financial statements will include the financial
position and results of operations of the Partnerships at their historical
cost basis.     
 
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 Principles of Combination and Consolidation
   
  Due to the existence of a paired share arrangement between LPL and LPML, the
financial position and results of operations of the Partnerships have been
presented on a combined basis. The combined financial     
 
                                      F-7


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