SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 2O549
FORM 1O-K
(Mark One)
/ x /Annual Report Pursuant to Section 13 or 15 (d) of the Securities and
Exchange Act of 1934 [Fee Required] for the fiscal year ended December 31, 2003.
or / /Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required] for the transition period from
____________ to ______________.
Commission File No. 2-96364.
DSI REALTY INCOME FUND IX, a California Limited Partnership
(Exact name of registrant as specified in governing instruments)
_________California___________________________33-0103189_____
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization identification
number
6700 E. Pacific Coast Hwy., Long Beach, California 9O8O3
(Address of principal executive offices) (Zip Code)
Registrants telephone number, including area code-(562)493-8881
Securities registered pursuant to Section 12(b) of the Act: none.
Securities registered pursuant to Section 12(g) of the Act:
Units of Limited Partnership Interests
(Class of Securities Registered)
Indicate by check mark, whether the registrant (l) 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 9O days. Yes_X____. No______.
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (Section 229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. /x/
The Registrant is a limited partnership and there is no voting stock. All
units of limited partnership sold to date are owned by non-affiliates of the
registrant. All such units were sold at $5OO.OO per unit.
DOCUMENTS INCORPORATED BY REFERENCE
Item 8. Registrant's Financial Statements for its fiscal year ended December 31,
2003, incorporated by reference to Form 10-K, Part II.
Item 11. Registrant's Financial Statements for its fiscal year ended December
31, 2003, incorporated by reference to Form 10-K, Part III.
Item 12. Registration Statement on Form S-11, previously filed with the
Securities and Exchange Commission pursuant to Securities Act of 1933, as
amended, incorporated by reference to Form 10-K Part III.
Item 13. Registrant's Financial Statements for its fiscal year ended December
31, 2003, incorporated by reference to Form 10-K, Part III.
PART I
Item l. BUSINESS
Registrant, DSI Realty Income Fund IX (the "Partnership") is a
publicly-held limited partnership organized under the California Uniform Limited
Partnership Act pursuant to a Certificate and Agreement of Limited Partnership
(hereinafter referred to as "Agreement") dated March 6, 1985, as amended and
restated to November 1, 1985. The General Partners are DSI Properties, Inc., a
California corporation, Robert J. Conway and Joseph W. Conway, brothers. The
General Partners are affiliates of Diversified Securities, Inc., a wholly-owned
subsidiary of DSI Financial, Inc. The General Partners provide similar services
to other partnerships. Through its public offering of Limited Partnership Units,
Registrant sold thirty thousand six hundred ninety-three (30,693) units of
limited partnership interests aggregating Fifteen Million Three Hundred
Forty-Six Thousand Five Hundred Dollars ($15,346,500) The General Partners have
retained a one percent (l%) interest in all profits, losses and distributions
(subject to certain conditions) without making any capital contribution to the
Partnership. The General Partners are not required to make any capital
contributions to the Partnership in the future. Registrant is engaged in the
business of investing in and operating mini-storage facilities with the primary
objectives of generating, for its partners, cash flow, capital appreciation of
its properties, and obtaining federal income tax deductions so that during the
early years of operations, all or a portion of such distributable cash may not
represent taxable income to its partners. Funds obtained by Registrant during
the public offering period of its units were used to acquire five mini-storage
facilities, as well as a joint venture interest with an affiliated Partnership
(DSI Realty Income Fund VIII, a California Limited Partnership) in which the
Partnership has a 70% interest in a mini-storage facility located in Aurora,
Colorado. Registrant does not intend to sell additional limited partnership
units. The term of the Partnership is fifty years but it is anticipated that
Registrant will sell and/or refinance its properties prior to the termination of
the Partnership. The Partnership is intended to be self-liquidating and it is
not intended that proceeds from the sale or refinancing of its operating
properties will be reinvested. Registrant has no full time employees but shares
one or more employees with other publicly-held limited partnerships sponsored by
the General Partners. The General Partners are vested with authority as to the
general management and supervision of the business and affairs of Registrant.
Limited Partners have no right to participate in the management or conduct of
such business and affairs. An independent management company has been retained
to provide day-to-day management services with respect to all of the
Partnership's investment properties.
Average occupancy levels for each of the Partnership's properties for the
years ended December 31, 2003 and December 31, 2002 are as follows:
Location of Property Average Occupancy Average Occupancy
Level for the Level for the
Year Ended Year Ended
Dec. 31, 2003 Dec. 31, 2002
Azusa, CA 84% 85%
Elgin, IL 72% 74%
Everett, WA 79% 80%
Monterey Park, CA 88% 89%
Romeoville, IL 68% 73%
Aurora, CO* 81% 82%
*The Partnership owns a 70% interest in this facility.
The business in which the Partnership is engaged is highly competitive.
Each of its mini-storage facilities is located in or near a major urban area,
and accordingly, competes with a significant number of individuals and
organizations with respect to both the purchase and sale of its properties and
for rentals. Generally, Registrant's business is not affected by the change in
seasons.
Item 2. PROPERTIES
Registrant owns a fee interest in five mini-storage facilities, as well as
a 70% interest in a joint venture with an affiliated partnership (DSI Realty
Income Fund VIII, a California Limited Partnership) which joint venture owns a
mini-storage facility, none of which are subject to long-term indebtedness. The
following table sets forth information as of December 31, 2003 regarding
properties owned by the Partnership.
Location Size of Net Rentable No. of Completion
Parcel Area Rental Units Date
Azusa, CA 2.94 acres 71,059 664 6/11/86
Elgin, IL 4.99 acres 48,363 441 9/29/86
Everett, WA 2.71 acres 50,572 488 12/01/85
Monterey Park,
CA .95 acres 31,654 392 8/23/86
Romeoville, IL 3.956 acres 65,941 690 11/24/86
Aurora, CO(1) 4.6 acres 86,676 887 9/05/85
(1) The Partnership has a 70% fee interest in this facility. DSI Realty Income
Fund VIII, a California Limited Partnership (an affiliated partnership)
owns a 30% fee interest in this facility.
Item 3. LEGAL PROCEEDINGS
Registrant is not a party to any material pending legal proceedings.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II
Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
Registrant, a publicly-held limited partnership, sold 30,693 limited
partnership units during its offering and currently has 1,178 limited partners
of record. There is no intention to sell additional limited partnership units
nor is there a market for these units.
Average cash distributions of $10.09 per Limited Partnership Unit were
declared and paid each quarter for the year ended December 31, 2003 and $11.99
per Limited Partnership Unit were declared and paid each quarter for the year
ended December 31, 2002 and $11.98 per Limited Partnership Unit were declared
and paid each quarter for the year ended December 31, 2001. It is the
Registrant's expectations that distributions will continue to be paid in the
future.
Item 6. SELECTED FINANCIAL DATA
FIVE YEARS ENDED DECEMBER 31, 2003
--------------------------------------------------------------------
2003 2002 2001 2000 1999
---- ---- ---- ---- ----
TOTAL REVENUES
AND OTHER
INCOME $2,848,497 $3,107,226 $ 3,201,000 $ 2,960,225 $ 2,878.176
TOTAL
EXPENSES 1,807,338 1,892,925 1,756,730 1,863,988 1,833,773
MINORITY
INTEREST
IN INCOME OF
REAL ESTATE
JOINT
VENTURE (128,775) (143,534) (168,986) (121,220) (122,453)
----------- ----------- ----------- ------------ -----------
NET
INCOME $ 912,384 $ 1,070,767 $ 1,275,284 $ 975,017 $ 921,950
=========== =========== =========== ============ ===========
TOTAL
ASSETS $ 4,713,603 $ 5,049,395 $ 5,472,712 $ 5,709,174 $ 6,265,344
=========== =========== =========== ============ ===========
CASH FLOW FROM:
OPERATING $ 1,486,963 $ 1,640,392 $ 1,803,290 $ 1,666,833 $ 1,639,711
INVESTING (6,499) (10,438) (28,442) (5,940) (42,758)
FINANCING (1,379,818) (1,631,748) (1,650,755) (1,654,732) (1,727,394)
NET INCOME
PER LIMITED
PARTNERSHIP
UNIT $ 29.43 $ 34.54 $ 41.13 $ 31.45 $ 29.74
=========== =========== =========== ============ ===========
CASH
DISTRIBUTIONS
PER LIMITED
PARTNERSHIP
UNIT $ 40.37 $ 47.96 $ 47.95 $ 47.99 $ 50.47
=========== =========== =========== ============ ===========
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
RESULTS OF OPERATIONS
2003 COMPARED TO 2002
Total revenues decreased from $3,106,379 in 2002 to $2,847,951 in 2003,
total expenses decreased from $1,892,925 to $1,807,338, other income decreased
from $847 to $546 and minority interest in income of the real estate joint
venture decreased from $143,534 to $128,775. As a result of these fluctuations
net income decreased from $1,070,767 to $912,384. The approximate $258,400
(8.3%) decrease in rental revenues can be attributed to lower occupancy and
unit rental rates. Occupancy levels for the Partnership's six mini-storage
facilities averaged 78.4% for the year ended December 31, 2003 and 83.0% for
the year ended December 31, 2002. The Partnership continued its advertising
campaign to attract and keep new tenants in its various mini-storage
facilities. The approximate $70,800 (7.9%) decrease in operating expenses
was due primarily to decreases in yellow pages advertising, maintenance and
repair, office supplies, salaries and wages and workers compensation insurance
expenses. The approximate $28,900 (11.3%) increase in general and admini-
strative expenses was due primarily to an increase in legal and professional
expense, partially offset by decreases in office expense and equipment and
computer lease expenses. Legal expense increased as a result of legal
challenges by dissident Limited Partners to a proposed amendment to the Part-
ners Agreement (see paragraph below). General Partners' incentive management
fees, which are based on cash distributions to Limited Partners, decreased as
a result of a decrease in these distributions. Property management fees,
which are based on rental revenue, decreased as a result of the decrease in
rental revenue.
2002 COMPARED TO 2001
Total revenues decreased from $3,197,589 in 2001 to $3,106,379 in 2002,
total expenses increased from $1,756,730 to $1,892,925, other income de-
creased from $3,411 to $847 and minority interest in income of the real estate
joint venture decreased from $168,986 to $143,534. As a result of these fluc-
tuations, net income decreased from $1,275,284 to $1,070,767. The approximate
$91,200 (2.9%) decrease in rental revenues can be attributed to lower occupancy
rates. Occupancy levels for the Partnership's six mini-storage facilities
averaged 83.0% for the year ended December 31, 2002 and 87.2% for the year
ended December 31, 2001. The Partnership continued its advertising
campaign to attract and keep new tenants in its various mini-storage
facilities. The approximate $38,300 (4.4%) increase in operating expenses
was due primarily to increases in yellow pages advertising, salaries and wages
and workers compensation insurance, partially offset by decreases in mainten-
ance and repair, security alarm service and power and sweeping expenses. The
approximate $73,600 (40.6%) increase in general and administrative expenses
was due primarily to increases in office supplies, legal and professional
equipment and computer lease expenses. General Partners' incentive management
fees remained relatively constant. Property management fees, which are based
on rental revenue, decreased as a result of the decrease in rental revenue.
Operating expenses consists mainly of expenses such as yellow pages and
other advertising, utilities, repairs and maintenance, real estate taxes,
salaries and wages and their related expenses. General and administrative
expenses consist mainly of expenses such as legal and professional, office
supplies, postage accounting services and computer expenses.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities decreased approximately
$153,400 (9.4%) in 2003 as compared to 2002 primarily as a result of the de-
crease in net income. Net cash provided by operating activities decreased
approximately $162,900 (9.0%) in 2002 as compared to 2001 primarily as a re-
sult of the decrease in net income.
Cash used in financing activities, as set forth in the statements of
cash flows, has been used for distributions to partners and the minority
investor in the Partnership's real estate joint venture. Special distri-
butions of 1.5% of capital contributed by Limited Partners, were declared
and paid on December 15, 2002 and 2001.
Cash used in investing activities, as set forth in the statements of cash
flows, consists of acquisitions of equipment for the Partnership's mini-storage
facilities. The Partnership has no material commitments for capital
expenditures.
On April 22, 2002, the General Partner received a copy of a hostile
tender offer from MacKenzie Patterson, Inc. and associated corporations and
limited partnerships. This offer was also files with the Securities and
Exchange Commission on the same date. The General Partners determined that
the hostile tender offer was not in the best interests of the Limited Partners,
that the offer was grossly inadequate given the performance history of the
Limited Partners reject the hostile tender offer and net tender their Units
pursuant thereto. The offer was subsequently increased and extended to
June 30, 2002 and again to July 22, 2002. The General Partners' initial
determination regarding the offer has not changed. Prior to the expiration
of the offer, Limited Partners tendered 22 Units representing 0.072% of the
outstanding Units of the Partnership.
The Limited Partners have approved an amendment to the Partnership
Agreement granting the General Partners ten days to review certain types of
transfers during which the General Partners may match, exceed or approve the
proposed transfers. The Court has rejected all preliminary attempts to halt
the implementation of the amendment. Subsequently, the dissident Limited
Partners who initiated the legal proceedings decided not to pursue the matter
any further.
The General Partners plan to continue their policy of funding the
continuing improvement and maintenance of Partnership properties with cash
generated from operations. The Partnership anticipates that cash flows
generated from operations of the Partnership's rental real estate operations
will be sufficient to cover operating expenses and distributions for the next
twelve months and beyond.
The General Partners are not aware of any environmental problems which
could have a material adverse effect upon the financial position of the
Partnership.
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Summarized quarterly financial data for the years ended December 31, 2003 and
2002 was as follows:
2003 Quarter Ended
------------------
March 31 June 30 September 30 December 31
-------- ------- ------------ -----------
Total revenues $763,313 $714,842 $704,751 $665,045
Income before
minority interest
in joint venture 314,429 267,387 216,741 242,602
Net income 276,245 235,882 186,617 213,640
Net income per limited
partnership unit $ 8.91 $ 7.61 $ 6.02 $ 6.89
Weighted average number
of limited partnership
units outstanding 30,693 30,693 30,693 30,693
2002 Quarter Ended
------------------
March 31 June 30 September 30 December 31
-------- ------- ------------ -----------
Total revenues $801,209 $770,436 $787,933 $746,801
Income before
minority interest
in joint venture 334,450 284,680 354,055 241,116
Net income 297,262 251,941 317,940 203,624
Net income per limited
partnership unit $ 9.59 $ 8.13 $ 10.26 $ 6.56
Weighted average number
of limited partnership
units outstanding 30,693 30,693 30,693 30,693
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Attached hereto as Exhibit l is the information required to be set forth as
Item 8, Part II hereof.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT'S
GENERAL PARTNER
The General Partners of Registrant are the same as when the Partnership was
formed, i.e., DSI Properties, Inc., a California corporation, Robert J. Conway
and Joseph W. Conway, brothers. As of December 31, 2003, Messrs. Robert J.
Conway and Joseph W. Conway, each of whom own approximately 48.4% of the issued
and outstanding capital stock of DSI Financial, Inc., a California corporation,
together with Mr. Joseph W. Stok, currently comprise the entire Board of
Directors of DSI Properties, Inc.
Mr. Robert J. Conway is 70 years of age and is a licensed California real
estate broker, and since 1965 has been President and a member of the Board of
Directors of Diversified Securities, Inc., and since 1973 President, Chief
Financial Officer and a member of the Board of Directors of DSI Properties, Inc.
Mr. Conway received a Bachelor of Science Degree from Marquette University with
majors in Corporate Finance and Real Estate.
Mr. Joseph W. Conway is age 75 and has been Executive Vice President,
Treasurer and a member of the Board of Directors of Diversified Securities, Inc.
since 1965 and since 1973 the Vice President, Treasurer and member of the Board
of Directors of DSI Properties, Inc. Mr. Conway received a Bachelor of Arts
Degree from Loras College with a major in Accounting.
Mr. Joseph W. Stok is age 81 and has been a member of the Board of
Directors of DSI Properties, Inc. since 1994, a Vice President of Diversified
Securities, Inc. since 1973, and an Account Executive with Diversified
Securities, Inc. since 1967.
Item 11. EXECUTIVE COMPENSATION (MANAGEMENT REMUNERATION AND
TRANSACTIONS)
The information required to be furnished in Item 11 of Part III is
contained in Registrant's Financial Statements for its fiscal year ended
December 31, 2003, which together with the report of its independent auditors,
Deloitte & Touche LLP, is attached hereto as Exhibit 1 and incorporated herein
by this reference. In addition to such information:
(a) No annuity, pension or retirement benefits are proposed to be paid by
Registrant to any of the General Partners or to any officer or
director of the corporate General Partner;
(b) No standard or other arrangement exists by which directors of the
Registrant are compensated;
(c) The Registrant has not granted any option to purchase any of its
securities; and
(d) The Registrant has no plan, nor does the Registrant presently propose
a plan, which will result in any remuneration being paid to any
officer or director upon termination of employment.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
As of December 31, 2003 no person of record owned more than 5% of the
limited partnership units of Registrant, nor was any person known by Registrant
to own of record and beneficially, or beneficially only, more than 5% thereof.
The balance of the information required to be furnished in Item 12 of Part III
is contained in Registrant's Registration Statement on Form S-11, previously
filed pursuant to the Securities Act of 1933, as amended, and which is
incorporated herein by this reference. The only change to the information
contained in said Registration Statement on Form S-11 is the fact that Messrs.
Benes and Blakley have retired and Messrs. Robert J. Conway and Joseph W. Conway
equity interest in DSI Financial, Inc., parent of DSI Properties, Inc., has
increased. Please see information contained in Item 10 hereinabove.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required to be furnished in Item 13 of Part III is
contained in Registrant's Financial Statements for its fiscal year ended
December 31, 2003, attached hereto as Exhibit l and incorporated herein by this
reference.
PART IV
Item 14 EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a)(l) Attached hereto and incorporated herein by this reference as Exhibit
l are Registrant's Financial Statements and Supplemental Schedule for
its fiscal year ended December 31, 2003, together with the reports of
its independent auditors, Deloitte & Touche. See Index to Financial
Statements and Supplemental Schedule.
(a)(2) Attached hereto and incorporated herein by this reference as Exhibit
2 is Registrant's letter to its Limited Partners regarding its Annual
Report for its fiscal year ended December 31, 2003.
(b) No reports on Form 8K were filed during the fiscal year ended December
31, 2003.
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) 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.
DSI REALTY INCOME FUND IX
by: DSI Properties, Inc., a
California corporation, as
General Partner
By_____________________________ Dated: March 31, 2004
ROBERT J. CONWAY, President
(Chief Executive Officer, Chief
Financial Officer, and Director)
By____________________________ Dated: March 31, 2004
JOSEPH W. CONWAY (Executive
Vice President and Director)
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the registrant and
in the capacities and on the date indicated.
DSI REALTY INCOME FUND IX
by: DSI Properties, Inc., a
California corporation, as
General Partner
By:__________________________ Dated: March 31, 2004
ROBERT J. CONWAY, President,
Chief Executive Officer, Chief
Financial Officer, and Director
By___________________________ Dated: March 31, 2004
JOSEPH W. CONWAY
(Executive Vice President
and Director)
DSI REALTY INCOME FUND IX
CROSS REFERENCE SHEET
FORM 1O-K ITEMS TO ANNUAL REPORT
PART I, Item 3. There are no legal proceedings pending or threatened.
PART I, Item 4. Not applicable.
PART II, Item 5. Not applicable.
PART II, Item 6. The information required is contained in Registrant's Financial
Statements for its fiscal year ended December 31, 2003, attached as Exhibit l to
Form 10-K.
PART II, Item 8. See Exhibit l to Form 10-K filed herewith.
PART II, Item 9. Not applicable.
EXHIBIT l
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
SELECTED FINANCIAL DATA
FIVE YEARS ENDED DECEMBER 31, 2003
--------------------------------------------------------------------
2003 2002 2001 2000 1999
---- ---- ---- ---- ----
TOTAL REVENUES
AND OTHER
INCOME $2,848,497 $3,107,226 $ 3,201,000 $ 2,960,225 $ 2,878.176
TOTAL
EXPENSES 1,807,338 1,892,925 1,756,730 1,863,988 1,833,773
MINORITY
INTEREST
IN INCOME OF
REAL ESTATE
JOINT
VENTURE (128,775) (143,534) (168,986) (121,220) (122,453)
----------- ----------- ----------- ------------ -----------
NET
INCOME $ 912,384 $ 1,070,767 $ 1,275,284 $ 975,017 $ 921,950
=========== =========== =========== ============ ===========
TOTAL
ASSETS $ 4,713,603 $ 5,049,395 $ 5,472,712 $ 5,709,174 $ 6,265,344
=========== =========== =========== ============ ===========
CASH FLOW FROM:
OPERATING $ 1,486,963 $ 1,640,392 $ 1,803,290 $ 1,666,833 $ 1,639,711
INVESTING (6,499) (10,438) (28,442) (5,940) (42,758)
FINANCING (1,379,818) (1,631,748) (1,650,755) (1,654,732) (1,727,394)
NET INCOME
PER LIMITED
PARTNERSHIP
UNIT $ 29.43 $ 34.54 $ 41.13 $ 31.45 $ 29.74
=========== =========== =========== ============ ===========
CASH
DISTRIBUTIONS
PER LIMITED
PARTNERSHIP
UNIT $ 40.37 $ 47.96 $ 47.95 $ 47.99 $ 50.47
=========== =========== =========== ============ ===========
The following are reconciliations between the operating results and partners'
equity per the financial statements and the Partnership's income tax return for
the year ended December 31, 2003.
Net Partners'
Income Equity
Per financial statements $ 912,384 $ 3,811,551
Excess book depreciation 35,971 258,965
Accrued incentive management fee 314,602
Joint venture income adjustment (95,347) 297,263
Property acquisition costs 466,135
Recognition of deferred rental revenues 56,021
Excess book distributions 310,030
Accrued property taxes (75,000)
Taxes paid - Buckley Road
----------- -----------
Per Partnership income tax return $ 853,008 $ 5,439,567
=========== ===========
Net taxable income per limited
partnership unit $ 27.51
===========
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE
Page
Independent Auditors' Report F-1
FINANCIAL STATEMENTS:
Consolidated Balance Sheets at December 31, 2003 and 2002 F-2
Consolidated Statements of Income for the Three
Years Ended December 31, 2003 F-3
Consolidated Statements of Changes in Partners' Equity (Deficit)
for the Three Years Ended December 31, 2003 F-4
Consolidated Statements of Cash Flows for the Three Years
Ended December 31, 2003 F-5
Notes to Consolidated Financial Statements F-6
SUPPLEMENTAL SCHEDULE:
Schedule III - Real Estate and Accumulated Depreciation F-9
SCHEDULES OMITTED:
Financial statements and schedules not listed above are omitted because of the
absence of conditions under which they are required or because the
information is included in the financial statements named above, or in the
notes thereto.
CONTROLS AND PROCEDURES
Within 90 days prior to the date of this report, the Partnership evalu-
ated the effectiveness of its desclosure controls and procedures. This
evaluation was performed by the Partnership's Controller with the assis-
tance of the Partnership's President and the Chief Executive Officer.
These disclosure controls and procedures are designed to ensure that the
information required to be disclosed by the Partnership in its periodic
reports filed with the Securities and Exchange Commission (the "Commis-
sion") is recorded processed, summarized and reported, within the time
periods specified by the Commissions's rules and forms, and that the
information is communicated to the certifying officers on a timely basis.
Based on this evaluation, the Partnership concluded that its disclosure
controls and procedures were effective. There have been no significant
changes in the Partnership's internal controls or in other factors that
could significantly affect the internal controls subsequent to the date
of their evaluation.
INDEPENDENT AUDITORS' REPORT
Partners
DSI Realty Income Fund IX:
We have audited the accompanying balance sheets of DSI Realty Income Fund IX, a
California Limited Partnership (the "Partnership") as of December 31, 2003
and 2002, and the related consolidated statements of income, changes in
partners' equity (deficit), and cash flows for each of the three years in the
period ended December 31, 2003. Our audits also included the financial state-
ment schedule listed in the Index at Item 14. These financial statements and
the financial statement schedule are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial statement schedule are free of material
misstatement. An audit includes examining, on a test basis, evidence support-
ing the amounts and disclosures in the financial statements. An audit also in-
cludes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of DSI Realty Income Fund IX
at December 31, 2003 and 2002, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2003,
in conformity with accounting principles generally accepted in the United
States of America. Also, in our opinion, such financial statement schedule,
when considered in relation to the basic financial statements taken as a whole,
presents fairly, in all material respects, the information set forth therein.
Deloitte & Touche LLP
March 20, 2004
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2002 AND 2003
- --------------------------------------------------------------------------------
ASSETS 2003 2002
CASH AND CASH EQUIVALENTS $ 732,355 $ 631,709
PROPERTY, net (Note 3) 3,876,070 4,308,446
OTHER ASSETS 105,178 109,240
----------- -----------
TOTAL $ 4,713,603 $ 5,049,395
=========== ===========
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
LIABILITIES:
Distribution due partners(Note 4) $ 310,030 $ 310,030
Incentive management fee payable to
general partners (Note 4) 314,602 315,879
Property management fees payable 8,689 8,657
Customer deposits and other liabilities 87,760 83,648
----------- -----------
Total liabilities 721,081 718,214
----------- -----------
MINORITY INTEREST IN REAL ESTATE
JOINT VENTURE 180,971 180,296
PARTNERS' EQUITY (DEFICIT)(Note 4):
General partners (99,325) (95,932)
Limited partners (30,693 limited
partnership units outstanding
at December 31, 2003 and 2002) 3,910,876 4,246,817
------------ -----------
Total partners' equity 3,811,551 4,150,885
------------ -----------
TOTAL $ 4,713,603 $ 5,049,395
============ ===========
See accompanying notes to financial statements.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
CONSOLIDATED STATEMENTS OF INCOME
THREE YEARS ENDED DECEMBER 31, 2003
- --------------------------------------------------------------------------------
2003 2002 2001
REVENUES:
Rental $2,847,951 $3,106,379 $3,197,589
---------- ---------- ----------
EXPENSES:
Depreciation 438,875 447,817 420,457
Operating 830,375 901,223 862,899
General and administrative 283,615 254,750 181,113
General partners' incentive
management fee (Note 4) 111,612 133,816 133,799
Property management fee 142,861 155,319 158,462
---------- ---------- ----------
Total expenses 1,807,338 1,892,925 1,756,730
---------- ---------- ----------
OPERATING INCOME 1,040,613 1,213,454 1,440,859
OTHER INCOME-
Interest income 546 847 3,411
---------- ---------- ----------
INCOME BEFORE MINORITY INTEREST IN
INCOME OF REAL ESTATE JOINT VENTURE 1,041,159 1,214,301 1,444,270
MINORITY INTEREST IN INCOME OF REAL
ESTATE JOINT VENTURE (128,775) (143,534) (168,986)
---------- ---------- ----------
NET INCOME $ 912,384 $1,070,767 $1,275,284
========== ========== ==========
AGGREGATE NET INCOME ALLOCATED
TO (Note 4):
General partners 9,124 10,708 12,753
Limited partners $ 903,260 $1,060,059 $1,262,531
---------- ---------- ----------
TOTAL $ 912,384 $1,070,767 $1,275,284
========== ========== ==========
NET INCOME PER LIMITED PARTNERSHIP
UNIT (Notes 2 and 4) $ 29.43 $ 34.54 $ 41.13
========== ========== ==========
See accompanying notes to financial statements.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
THREE YEARS ENDED DECEMBER 31, 2003
- --------------------------------------------------------------------------------
General Limited
Partners Partners Total
------- ----------- -----------
BALANCE JANUARY 1, 2001 $(89,657) $ 4,867,996 $ 4,778,339
Net income 12,753 1,262,531 1,275,284
Distributions (14,867) (1,471,788) (1,486,655)
------- ----------- -----------
BALANCE DECEMBER 31, 2001 $(91,771) $ 4,658,739 $ 4,566,968
Net income 10,708 1,060,059 1,070,767
Distributions (14,869) (1,471,981) (1,486,850)
------- ----------- -----------
BALANCE DECEMBER 31, 2002 $(95,932) $ 4,246,817 $ 4,150,885
Net income 9.124 903,260 912.384
Distributions (12,517) (1,239,201) (1,251,718)
------- ----------- -----------
BALANCE, DECEMBER 31, 2003 $(99,325) $ 3,910,876 $ 3,811,551
======= =========== ===========
See accompanying notes to financial statements.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE YEARS ENDED DECEMBER 31, 2003
- --------------------------------------------------------------------------------
2003 2002 2001
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 912,384 $ 1,070,767 $ 1,275,284
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 438,875 447,817 420,457
Minority interest in income
of real estate joint venture 128,775 143,534 168,986
Changes in assets and liabilities:
Other assets 4,062 (15,856) (31,460)
Incentive management
fee payable (1,277) 17 (1,425)
Property management fees payable 32 (802) (390)
Customer deposits and
other liabilities 4,112 (5,085) (28,162)
----------- ----------- ------------
Net cash provided by operating
activities 1,486,963 1,640,392 1,803,290
----------- ----------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES -
Additions to property (6,499) (10,438) (28,442)
----------- ----------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions paid to minority interest
in real estate joint venture (128,100) (144,898) (167,700)
Contributions received from
minority interest in real
estate joint venture 3,600
Distributions to partners (1,251,718) (1,486,850) (1,486,655)
____________ ___________ __________
Net cash used in financing
activities (1,379,818) (1,631,748) (1,650,755)
------------ ----------- ----------
NETINCREASE(DECREASE) IN CASH AND
CASH EQUIVALENTS 100,646 (1,794) 124,093
CASH AND CASH EQUIVALENTS,
AT BEGINNING OF YEAR 631,709 633,503 509,410
----------- ----------- -----------
CASH AND CASH EQUIVALENTS,
AT END OF YEAR $ 732,355 $ 631,709 $ 633,503
=========== =========== ============
See accompanying notes to consolidated financial statements.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE YEARS ENDED DECEMBER 31, 2003
1. GENERAL
DSI Realty Income Fund IX, a California Real Estate Limited Partnership
(the "Partnership"), has three general partners (DSI Properties, Inc.,
Robert J. Conway and Joseph W. Conway) and limited partners owning 30,693
limited partnership units which were purchased for $500 a unit. The
general partners have made no contributions to the Partnership and are not
required to make any capital contribution in the future. The Partnership
has a maximum life of 50 years and was formed on April 12, 1985 under the
California Uniform Limited Partnership Act for the primary purpose of
acquiring and operating real estate.
The Partnership has acquired five mini-storage facilities located in
Monterey Park and Azusa, California; Everett, Washington;and Romeoville and
Elgin, Illinois. The Partnership has also entered into a joint venture with
DSI Realty Income Fund VIII through which the Partnership has a 70%
interest in a mini-storage facility in Aurora, Colorado. The Partnership
is a general partner in the joint venture. The facilities were acquired
from Dahn Corporation ("Dahn"). Dahn is not affiliated with the Partner-
ship. Dahn is affiliated with other partnerships in which DSI
Properties, Inc., Robert J. Conway and Joseph W. Conway are the general
partners. The mini-storage facilities are operated for the Partnership
by Dahn under various agreements which are subject to renewal annually.
Under the terms of the agreements, the Partnership is required to pay
Dahn a property management fee equal to 5% of gross revenue from
operations, defined as the entire amount of all receipts from the renting
or leasing of storage compartments and sale of locks.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation - The accompanying consolidated financial
statements include the accounts of DSI Realty Income Fund IX and its 70%
owned real estate joint venture. All significant intercompany accounts and
transactions have been eliminated in consolidation.
Cash and Cash Equivalents - The Partnership classifies its short-term
investments purchased with an original maturity of three months or less as
cash equivalents.
Property and Depreciation - Property is recorded at cost and is composed
primarily of mini-storage facilities. Depreciation is provided for using
the straight-line method over an estimated useful life ranging from 15 to
20 years for the facilities. Improvements are depreciated over a five-
year period.
Income Taxes - No provision has been made for income taxes in the
accompanying financial statements. The taxable income or loss of the
Partnership is allocated to each partner in accordance with the terms of
the Agreement of Limited Partnership. Each partner's tax status, in turn,
determines the appropriate income tax for its allocated share of the
Partnership's taxable income or loss. The net difference between the basis
of the Partnership's assets and liabilities for federal income tax purposes
and as reported for financial statement purposes is $59,376.
Revenues - Rental revenue is recognized using the accrual method based on
contractual amounts provided for in the lease agreements, which
approximates recognition on a straight-line basis. The term of the lease
agreements is usually less than one year.
Net Income per Limited Partnership Unit - Net income per limited
partnership unit is computed by dividing the net income allocated to the
limited partners by the weighted average number of limited partnership
units outstanding during each year.
Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires the Partnership's management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ
from those estimates.
Impairment of Long-Lived Assets - The Partnership regularly reviews long-
lived assets for impairment whenever events or changes in circumstances
indicate that the carrying amount of the asset may not be recoverable.
If the sum of the expected undiscounted future cash flow is less than the
carrying amount of the asset, the Partnership would recognize an impairment
to the extent the carrying value exceeded the fair value of the property.
No impairment losses were required in 2003, 2002 or 2001.
Fair Value of Financial Instruments - The Partnership's financial
instruments consist primarily of cash, receivables, accounts payable and
accrued liabilities. The carrying values of all financial instruments
are representative of their fair values due to their short-term maturities.
Concentrations of Credit Risk - Financial instruments that potentially
subject the Partnership to concentrations of credit risk consist primarily
of cash and cash equivalents and rent receivables. The Partnership places
its cash equivalents with high credit quality institutions.
Impact of Recent Accounting Pronouncements - In 2003, the Partnership
adopted the following pronouncements: Statement of Financial Accounting
Standards ("SFAS") No. 144, Accounting for Impairment or Disposal of Long-
Lived Assets', and SFAS No. 145, Rescission of FASB Statements No. 4, 44,
and 64, Amendment of FASB Statement No. 13, and Technical Corrections.
The adoption of these pronouncements did not have a material impact on the
Partnership's financial position or results of operations. The Partnership
believes the adoption of Financial Accounting Standards Board Interpre-
tation No. 46, Consolidation of Variable Interest Entities, will not have
a material impact on the consolidated financial statements.
3. PROPERTY
The total cost of property and the accumulated depreciation is as follows
as of December 31:
2003 2002
Land $ 2,729,790 $ 2,729,790
Buildings and improvements 11,069,318 11,062,819
----------- -----------
Total 13,799,108 13,792,609
Accumulated depreciation (9,923,038) (9,484,163)
----------- ----------
Property, net $ 3,876,070 $ 4,308,446
=========== ===========
4. ALLOCATION OF PROFITS AND LOSSES AND GENERAL PARTNERS' INCENTIVE
MANAGEMENT FEE
Under the Agreement of Limited Partnership, the general partners are to be
allocated 1% of the net profits or net losses from operations, and the
limited partners are to be allocated the balance of the net profits or
losses from operations in proportion to their limited partnership
interests. The general partners are also entitled to receive a percent-
age, based on a predetermined formula, of any cash distribution from
the sale, other disposition, or refinancing of the real estate project.
In addition, the general partners are entitled to an incentive management
fee for supervising the operations of the Partnership. The fee is to be
paid in an amount equal to 9% per annum of Partnership distributions
made from cash available for distribution, calculated as cash generated
from operations less capital expenditures.
5. BUSINESS SEGMENT INFORMATION
The following disclosure about segment reporting of the Partnership is
made in accordance with the requirements of SFAS No. 131, "Disclosures
about Segments of an Enterprise and Related Information." The Partner-
ship operates in a single segment; storage facility operations, under
which the Partnership rents its storage facilities to its customers on
a need basis and charges rent on a predetermined rate.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
REAL ESTATE AND ACCUMULATED DEPRECIATION
- --------------------------------------------------------------------------------
Costs Capitalized
Initial Cost to Subsequent to Gross Amount at Which Carried
Partnership Acquisition at Close of Period
------------------- ----------------- -----------------------------
Buildings Buildings Date
and Improve- Carrying and Accum. of Date
Description Encumbrances Land Improvements ments Costs Land Improvements Total Deprec. Const. Acq. Life
MINI-U-STORAGE
Monterey Park, CA None $420,200 $1,409,050 $12,620 $420,200 $1,421,670 $1,841,870 $1,223,599 08/86 12/85 20 Yrs
Azusa, CA None 696,000 2,095,965 14,726 696,000 2,110,691 2,806,691 1,844,929 06/86 01/86 20 Yrs
Everett, WA None 352,350 1,252,536 6,431 352,350 1,258,967 1,611,317 1,136,824 11/85 06/85 20 Yrs
Romeoville, IL None 298,740 2,180,802 57,366 298,740 2,238,168 2,536,908 1,893,058 01/87 05/86 20 Yrs
Elgin, IL None 376,000 1,424,577 12,462 376,000 1,437,039 1,813,039 1,225,860 09/86 03/86 20 Yrs
Aurora, CO None 586,500 2,521,560 81,223 586,500 2,602,783 3,189,283 2,598,768 02/85 09/85 15 Yrs
-------- ---------- ------- -------- ---------- ---------- ----------
$2,729,790 $10,884,490 $184,828 $2,729,790 $11,069,318 $13,799,108*$9,923,038
========== ========== ======== ========== ========== =========== ==========
Real Estate Accumulated
at Cost Depreciation
Balance, December 31, 2000 $13,753,729 $8,615,889
Additions 28,442 420,457
----------- ----------
Balance, December 31, 2001 $13,782,171 $9,036,346
Additions 10,438 447,817
----------- ----------
Balance, December 31, 2002 $13,792,609 $9,484,163
Additions 6,499 438,875
----------- ----------
Balance, December 31, 2003 $13,799,108 $9,923,038
=========== ==========
SCHEDULE 2
March 20, 2004
ANNUAL REPORT TO LIMITED PARTNERS OF
DSI REALTY INCOME FUND X
Dear Limited Partners:
This reprot contains the Partnership's balance sheets as of December 31,
2003 and 2002, and the related statements of income, changes in partner' equity
and cash flows for each of the three years in the period ended December 31,
2003 accompanied by an independent auditors' report. The Partnership owns
five mini-storage facilities and a 70% interest in a sixth mini-storage facility
on a joint venture basis with an affiliated Partnership, DSI Realty Income
Fund VIII. The Partnership's properties were each purchased for all cash and
funded solely from subscriptions for limited partnership interests without the
use of mortgage financing.
Your attention is directed to the section entitled Management's Discussion
and Analysis of Financial Condition and Results of Operations for the General
Partners' discussion and analysis of the financial statements and operations
of the Partnership.
Average occupancy levels for each of the Partnership's six properties
for the years ended December 31, 2003 and December 31, 2002 were as follows:
Location of Property Average Occupancy Average Occupancy
Level for the Level for the
Year Ended Year Ended
Dec. 31, 2003 Dec. 31, 2002
Azusa, CA 84% 85%
Elgin, IL 72% 74%
Everett, WA 79% 80%
Monterey Park, CA 88% 89%
Romeoville, IL 68% 73%
Aurora, CO* 81% 82%
*The Partnership owns a 70% interest in this facility.
We will keep you informed of the activities of DSI Realty Income Fund IX
as they develop. If you have any questions, please contact us at your con-
venience at (562) 493-3022.
If you would like a copy of the Partnership's Annual Report on Form 10-K
for the year ended December 31, 2003 which was filed with the Securities and
Exchange Commission (which report includes the enclosed Financial Statements),
we will forward a copy of the report to you upon written request.
Very truly yours,
DSI REALTY INCOME FUND IX
By: DSI Properties, Inc.
Robert J. Conway, President
CERTIFICATIONS
I, Robert J. Conway, certify that:
1. I have reviewed this annual report on Form 10-K of DSI Realty Income
Fund IX;
2. Based on my knowledge, this annual 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 cover-
ed by this annual report.
3. Based on my knowledge, the financial statements, and other financial
information included in this annual 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 annual 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 have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its con-
solidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual 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 annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effec-
tiveness of the disclosure controls and procedures based on our evalu-
ation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to re-
cord, 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 in-
ternal controls; and
6. The registrnat's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls sub-
sequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: March 20, 2004
Robert J. Conway
Chief Executive Officer
CERTIFICATIONS
I, Richard P. Conway, certify that:
1. I have reviewed this annual report on Form 10-K of DSI Realty Income
Fund IX;
2. Based on my knowledge, this annual 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 cover-
ed by this annual report.
3. Based on my knowledge, the financial statements, and other financial
information included in this annual 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 annual 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 have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its con-
solidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual 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 annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effec-
tiveness of the disclosure controls and procedures based on our evalu-
ation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to re-
cord, 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 in-
ternal controls; and
6. The registrnat's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls sub-
sequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: March 20, 2004
Richard P. Conway
Vice President
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of DSI Realty Income Fund IX (the
"Partnership") on Form 10-K for the period ending December 31, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Robert J. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 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.
Robert J. Conway
Chief Executive Officer
March 20, 2004
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of DSI Realty Income Fund IX (the
"Partnership") on Form 10-K for the period ending December 31, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Richard P. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 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.
Richard P. Conway
Vice President
March 20, 2004