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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
Commission file number 0-13517
AMERICAN LEASING INVESTORS VI-A
(Exact name of registrant as specified in its charter)
CALIFORNIA 13-3190452
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
411 West Putnam Avenue, Greenwich, CT 06830
(Address of principal executive offices)
(203) 862-7000
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check 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 [ ]
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AMERICAN LEASING INVESTORS VI-A
(A limited partnership)
FORM 10-Q - MARCH 31, 1996
INDEX
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
BALANCE SHEETS - March 31, 1996 and December 31, 1995
STATEMENTS OF OPERATIONS -
For the three months ended March 31, 1996 and 1995
STATEMENT OF PARTNERS' EQUITY -
For the three months ended March 31, 1996
STATEMENTS OF CASH FLOWS -
For the three months ended March 31, 1996 and 1995
NOTES TO FINANCIAL STATEMENTS
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
SIGNATURES
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
AMERICAN LEASING INVESTORS VI-A
(A limited partnership)
BALANCE SHEETS
March 31, December 31,
1996 1995
----------- -----------
ASSETS
Equipment held for sale ..................... $ 1,596,380 $ 1,596,380
Other assets ................................ 1,374 1,374
Cash and cash equivalents ................... 145 28,987
----------- -----------
$ 1,597,899 $ 1,626,741
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Liabilities
Accounts payable and accrued expenses ....... $ 35,998 $ 45,576
----------- -----------
Commitments and contingencies
Partners' equity
Limited partners' equity (12,319 units issued
and outstanding) ......................... 1,606,460 1,625,531
General partners' deficit ................... (44,559) (44,366)
----------- -----------
Total partners' equity ................... 1,561,901 1,581,165
----------- -----------
$ 1,597,899 $ 1,626,741
=========== ===========
See notes to financial statements.
AMERICAN LEASING INVESTORS VI-A
(A limited partnership)
STATEMENTS OF OPERATIONS
For the three months ended
March 31,
--------------------------
1996 1995
-------- --------
Revenues
Interest ........................................... $ -- $ 1,692
-------- --------
-- 1,692
-------- --------
Costs and expenses
General and administrative ......................... 11,825 15,555
Operating .......................................... 7,439 13,673
-------- --------
19,264 29,228
-------- --------
Net loss ............................................. $(19,264) $(27,536)
======== ========
Net loss attributable to
Limited partners ................................... $(19,071) $(27,261)
General partners ................................... (193) (275)
-------- --------
$(19,264) $(27,536)
======== ========
Net loss per unit of limited partnership interest
(12,319 units outstanding) ......................... $ (1.55) $ (2.21)
======== ========
See notes to financial statements.
AMERICAN LEASING INVESTORS VI-A
(A limited partnership)
STATEMENT OF PARTNERS' EQUITY
Limited General Total
Partners' Partners' Partners'
Equity Deficit Equity
----------- ----------- -----------
Balance, January 1, 1996 ......... $ 1,625,531 $ (44,366) $ 1,581,165
Net loss for the three months
ended March 31, 1996 ........ (19,071) (193) (19,264)
----------- ----------- -----------
Balance, March 31, 1996 .......... $ 1,606,460 $ (44,559) $ 1,561,901
=========== =========== ===========
See notes to financial statements.
AMERICAN LEASING INVESTORS VI-A
(A limited partnership)
STATEMENTS OF CASH FLOWS
For the three months ended
March 31,
--------------------------
1996 1995
--------- ---------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS
Cash flows from operating activities
Net loss ........................................ $ (19,264) $ (27,536)
Changes in assets and liabilities
Other assets ................................. -- 2,700
Accounts payable and accrued expenses ........ (9,578) (2,856)
--------- ---------
Net cash used in operating activities .... (28,842) (27,692)
--------- ---------
Cash flows from investing activities
Other non-operating payments .................... -- (15,823)
--------- ---------
Net cash used in investing activities .... -- (15,823)
--------- ---------
Net decrease in cash and cash equivalents ............ (28,842) (43,515)
Cash and cash equivalents, beginning of period ....... 28,987 149,843
--------- ---------
Cash and cash equivalents, end of period ............. $ 145 $ 106,328
========= =========
See notes to financial statements.
AMERICAN LEASING INVESTORS VI-A
(A limited partnership)
NOTES TO FINANCIAL STATEMENTS
1 INTERIM FINANCIAL INFORMATION
The summarized financial information contained herein is unaudited;
however, in the opinion of management, all adjustments (consisting only
of normal recurring accruals) necessary for a fair presentation of such
financial information have been included. The accompanying financial
statements, footnotes and discussion should be read in conjunction with
the financial statements, related footnotes and discussions contained
in the American Leasing Investors VI-A (the "Partnership") annual
report on Form 10-K for the year ended December 31, 1995. The results
of operations for the three months ended March 31, 1996 are not
necessarily indicative of the results to be expected for the full year.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Equipment Held for Sale
The cost of equipment held for sale (formerly, leased equipment
accounted for under the financing method) represents the initial cost
of the equipment to the Partnership plus miscellaneous acquisition and
closing costs, and is carried at the lower of depreciated cost or net
realizable value. Depreciation is not taken on equipment held for sale.
When equipment is sold or otherwise disposed of, the cost and
accumulated depreciation (and any related allowance for equipment
impairment) are removed from the accounts and any gain or loss on such
sale or disposal is reflected in operations. Normal maintenance and
repairs are charged to operations as incurred. The Partnership provides
allowances for equipment impairment based upon a quarterly review of
all equipment in its portfolio, when management believes that, based
upon market analysis, appraisal reports and leases currently in place
with respect to specific equipment, the investment in such equipment
may not be recoverable.
3 CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES
The corporate general partner of the Partnership, ALI Capital Corp.
(the "Corporate General Partner"), the managing general partner of the
Partnership, ALI Equipment Management Corp. ("Equipment Management"),
and Integrated Resources Equipment Group, Inc. ("IREG") are wholly
owned subsidiaries of Presidio Capital Corp. ("Presidio"). CDG
Associates was the associate general partner of the Partnership through
February 27, 1995. On February 28, 1995, Presidio Boram Corp., a
subsidiary of Presidio, became the associate general partner. Other
limited partnerships and similar investment programs have been formed
by Equipment Management or its affiliates to acquire equipment and,
accordingly, conflicts of interest may arise between the Partnership
and such other limited partnerships. Affiliates of Equipment Management
have also engaged in businesses related to the management of equipment
and the sale of various types of equipment and may transact business
with the Partnership.
3 CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES (continued)
Subject to the rights of the Limited Partners under the Limited
Partnership Agreement, Presidio will control the Partnership through
its direct or indirect ownership of all of the shares of Equipment
Management, the Corporate General Partner and, as of February 28, 1995,
the associate general partner. Presidio is managed by Presidio
Management Company, LLC ("Presidio Management"), a company controlled
by a director of Presidio. Presidio Management is responsible for the
day-to-day management of Presidio and, among other things, has
authority to designate directors of Equipment Management, the Corporate
General Partner and the associate general partner. In March 1996,
Presidio Management assigned its agreement for the day-to-day
management of Presidio to Wexford Management LLC ("Wexford").
Presidio is a liquidating company. Although Presidio has no immediate
plans to do so, it will ultimately seek to dispose of the interests it
acquired from Integrated Resources, Inc. through liquidation; however,
there can be no assurance of the timing of such transaction or the
effect it may have on the Partnership.
In March 1995, Presidio elected new directors for Equipment Management.
Wexford Management Corp., formerly Concurrency Management Corp.,
provides management and administrative services to Presidio, its direct
and indirect subsidiaries, as well as to the Partnership. Effective
January 1, 1996, Wexford Management Corp. assigned its agreement to
provide management and administrative services to Presidio and its
subsidiaries to Wexford. During the three months ended March 31, 1996,
reimbursable expenses to Wexford by the Partnership amounted to $3,300.
The Partnership has a management agreement with IREG, pursuant to which
IREG would receive 5% of annual gross rental revenues on operating
leases; 2% of annual gross rental revenues on full payout leases which
contain net lease provisions; and 1% of annual gross rental revenues if
services are performed by third parties under the active supervision of
IREG, as defined in the Limited Partnership Agreement. The Partnership
did not incur equipment management fees during the three months ended
March 31, 1996 and 1995.
During the operating and sale stage of the Partnership, IREG is
entitled to a partnership management fee equal to 4% of distributions
of distributable cash from operations, as defined in the Limited
Partnership Agreement, subject to increase after the limited partners
have received certain specified minimum returns on their investment. No
such amounts were incurred during the three months ended March 31, 1996
and 1995.
The general partners are entitled to 1% of distributable cash from
operations and cash from sales and an allocation of 1% of taxable net
income or loss of the Partnership.
During the operating and sale stage of the Partnership, IREG may be
entitled to receive certain other fees which are subordinated to the
receipt by the limited partners of their original invested capital and
certain specified minimum returns on their investment.
3 CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES (continued)
Upon the ultimate liquidation of the Partnership, the general partners
may be required to remit to the Partnership certain payments
representing capital account deficit restoration based upon a formula
provided within the Limited Partnership Agreement. Such restoration
amount may be less than the recorded general partners' deficit, which
could result in distributions to the limited partners of less than
their recorded equity.
In April 1995, Equipment Management and certain affiliates entered into
an agreement with Fieldstone Private Capital Group, L.P. ("Fieldstone")
pursuant to which Fieldstone performs certain management and
administrative services relating to the Partnership as well as certain
other partnerships in which Equipment Management serves as general
partner. Substantially all costs associated with the retention of
Fieldstone will be paid by Equipment Management.
4 LEASE TERMINATION
On July 1, 1994, upon the receipt of the final rental installment, the
lease of one Fokker F-28 Mark 4000 aircraft (the "Aircraft") with one
spare Rolls Royce 555-15 Spey engine (the "Spare Engine") expired in
accordance with its original terms. The associated nonrecourse debt was
repaid upon the receipt of the final rental installment. The Aircraft
and the Spare Engine are the Partnership's remaining assets and
represent approximately 47% of the original equipment acquired by the
Partnership on an original cost basis. The Aircraft and the Spare
Engine were returned to the Partnership and placed into a storage
facility. The Partnership is currently attempting to sell the Aircraft
with the Spare Engine. The Partnership is encountering severe
competition in attempting to sell the Aircraft and the Spare Engine.
The aircraft industry is highly competitive. Realizable values from the
sale of aircraft vary considerably, depending upon the type of
aircraft, the condition of the aircraft, the number of such type of
aircraft available for sale and the nature of the prospective user.
5 MANAGEMENT'S PLANS
The Partnership's remaining asset currently does not generate any cash
flow to support its operations. The Partnership is attempting to
dispose of its remaining equipment. The Managing General Partner has no
obligation under the Partnership's Agreement of Limited Partnership to
fund cash flow shortfalls or to furnish direct or indirect financial
assistance to the Partnership. However, the Managing General Partner
intends to advance funds to the Partnership to enable it to continue
operating until the sale of the remaining equipment. Upon the
consummation of a sale of its remaining asset, the Partnership will
have completed the liquidation of its equipment portfolio. The Managing
General Partner will then prepare a final accounting of the
Partnership's assets and liabilities, commence the dissolution and
termination of the Partnership and make a final distribution to its
partners.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Partnership did not make a cash distribution with respect to the
quarter ended March 31, 1996. As of March 31, 1996, the Partnership had
no operating reserves remaining. The Partnership has utilized all of
its working capital reserve to fund operations, primarily the
continuation of certain operating expenses. In April 1996, the Managing
General Partner advanced the Partnership $20,000 in order to continue
the Partnership's operations.
The Partnership's remaining asset, a Fokker F-28 Mark 4000 aircraft
(the "Aircraft") with one spare Rolls Royce 555-15 Spey engine (the
"Spare Engine") (lease terminated July 1, 1994) represents
approximately 47% of the Partnership's original portfolio. The
associated debt was re-paid upon the receipt of the final rental
installment. The Aircraft with the Spare Engine was returned to the
Partnership and placed into a storage facility and the Partnership is
currently looking into sales opportunities. The Partnership is
encountering severe competition in attempting to sell the Aircraft with
the Spare Engine, as the aircraft industry is highly competitive.
Realizable values from the sale vary considerably, depending upon the
type of aircraft, the condition of the aircraft, the number of such
type of aircraft available for sale and the nature of the prospective
user.
The Partnership's remaining asset currently does not generate any cash
flow to support the Partnership's operations. The Managing General
Partner has no obligation under the Partnership's Agreement of Limited
Partnership to fund cash flow shortfalls or to furnish direct or
indirect financial assistance to the Partnership. However, the Managing
General Partner intends to advance funds to the Partnership to enable
it to continue operating until the sale of the remaining equipment.
Upon the consummation of a sale of its remaining asset, the Partnership
will have completed the liquidation of its equipment portfolio. The
Managing General Partner will then prepare a final accounting of the
Partnership's assets and liabilities, commence the dissolution and
termination of the Partnership and make a final distribution to
partners.
The Partnership had no outstanding material commitments for capital
expenditures as of March 31, 1996.
Inflation and changing prices have not had any material effect on the
Partnership's revenues since its inception nor does the Partnership
anticipate any material effect on its business from these factors.
In April 1995, the managing general partner of the Partnership, ALI
Equipment Management Corp. ("Equipment Management"), and certain
affiliates entered into an agreement with Fieldstone Private Capital
Group, L.P. ("Fieldstone") pursuant to which Fieldstone will perform
certain management and administrative services relating to the
Partnership as well as certain other partnerships in which Equipment
Management serves as general partner. Such agreement provides that
substantially all costs associated with the retention of Fieldstone
will be paid by Equipment Management.
Results of Operations
The net loss decreased for the quarter ended March 31, 1996 as compared
to the quarter ended March 31, 1995 as the absence of revenues was
partially offset by the decrease in expenses for the quarter ended
March 31, 1996.
Expenses decreased for the quarter ended March 31, 1996 as compared to
the comparable prior year period.
The Partnership did not incur depreciation expense during the quarter
ended March 31, 1996 and 1995; the remaining asset owned by the
Partnership was accounted for as a financing lease and terminated at
July 1, 1994 in accordance with its original lease terms. Operating
expenses decreased significantly for the quarter ended March 31, 1996,
as compared to the corresponding period of the prior year, due to a
reduction in expenses incurred related to the storage of the Aircraft,
which has been off-lease since July 1994, as well as a reduction in
administrative costs.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: None
(b) Reports on Form 8-K: None
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.
AMERICAN LEASING INVESTORS VI-A
By: ALI Equipment Management Corp.
Managing General Partner
/S/ Douglas J. Lambert
----------------------------------
Douglas J. Lambert
President (Principal Executive and
Financial Officer)
May 15, 1996