UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[XX] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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For Quarter Ended June 30, 1996 Commission File No. 33-35148
American Income Fund I-A, a Massachusetts Limited Partnership
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(Exact name of registrant as specified in its charter)
Massachusetts 04-3097216
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
98 North Washington Street, Boston, MA 02114
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 854-5800
------------------------------
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by 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
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court 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 No
--- ---
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
FORM 10-Q
INDEX
Page
----
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Statement of Financial Position
at June 30, 1996 and December 31, 1995 3
Statement of Operations
for the three and six months ended
June 30, 1996 and 1995 4
Statement of Cash Flows
for the six months ended June 30, 1996 and 1995 5
Notes to the Financial Statements 6-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9-12
PART II. OTHER INFORMATION:
Items 1 - 6 13
2
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
STATEMENT OF FINANCIAL POSITION
June 30, 1996 and December 31, 1995
(Unaudited)
June 30, December 31,
1996 1995
----------- ------------
ASSETS
- ------
Cash and cash equivalents $1,470,510 $1,595,008
Rents receivable 30,325 75,152
Accounts receivable - affiliate 66,011 35,962
Equipment at cost, net of accumulated
depreciation of $4,291,899 and
$4,245,887 at June 30, 1996
and December 31, 1995, respectively 813,714 877,302
---------- ----------
Total assets $2,380,560 $2,583,424
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
- ---------------------------------
Notes payable $ $ 5,186
Accrued interest -- 135
Accrued liabilities 57,815 25,830
Accrued liabilities - affiliate 4,757 7,685
Deferred rental income 6,437 9,384
Cash distributions payable to partners 113,003 113,003
---------- ----------
Total liabilities 182,012 161,223
---------- ----------
Partners' capital (deficit):
General Partner (206,957) (195,775)
Limited Partnership Interests
(286,274 Units; initial purchase
price of $25 each) 2,405,505 2,617,976
---------- ----------
Total partners' capital 2,198,548 2,422,201
---------- ----------
Total liabilities and partners'
capital $2,380,560 $2,583,424
========== ==========
The accompanying notes are an integral part
of these financial statements.
3
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
STATEMENT OF OPERATIONS
for the three and six months ended June 30, 1996 and 1995
(Unaudited)
Three Months Six Months
Ended June 30, Ended June 30,
1996 1995 1996 1995
--------- --------- --------- ---------
Income:
Lease revenue $135,066 $211,845 $276,219 $431,809
Interest income 19,552 20,491 39,137 44,093
Gain on sale of equipment 8,689 95,996 21,244 88,883
-------- -------- -------- --------
Total income 163,307 328,332 336,600 564,785
-------- -------- -------- --------
Expenses:
Depreciation and amortization 86,989 137,895 175,127 292,630
Interest expense -- 2,451 -- 6,031
Equipment management fees
- affiliate 6,678 9,064 15,562 18,526
Operating expenses
- affiliate 32,369 13,591 143,558 29,888
-------- -------- -------- --------
Total expenses 126,036 163,001 334,247 347,075
-------- -------- -------- --------
Net income $ 37,271 $165,331 $ 2,353 $217,710
======== ======== ======== ========
Net income
per limited partnership unit $ 0.12 $ 0.55 $ 0.01 $ 0.72
======== ======== ======== ========
Cash distributions declared
per limited partnership unit $ 0.38 $ 0.75 $ 0.75 $ 1.50
======== ======== ======== ========
The accompanying notes are an integral part
of these financial statements.
4
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
STATEMENT OF CASH FLOWS
for the six months ended June 30, 1996 and 1995
(Unaudited)
1996 1995
------------ ------------
Cash flows from (used in) operating
activities:
Net income $ 2,353 $ 217,710
Adjustments to reconcile net income to
net cash from operating activities:
Depreciation and amortization 175,127 292,630
Gain on sale of equipment (21,244) (88,883)
Changes in assets and liabilities
Decrease (increase) in:
rents receivable 44,827 (5,397)
accounts receivable - affiliate (30,049) 43,727
Increase (decrease) in:
accrued interest (135) (605)
accrued liabilities 31,985 30
accrued liabilities - affiliate (2,928) --
deferred rental income (2,947) (4,691)
---------- ----------
Net cash from operating activities 196,989 454,521
---------- ----------
Cash flows from (used in) investing
activities:
Purchase of equipment (127,020) --
----------
Proceeds from equipment sales 36,725 206,899
---------- ----------
Net cash from (used in) investing
activities (90,295) 206,899
---------- ----------
Cash flows used in financing activities:
Principal payments - notes payable (5,186) (122,756)
Distributions paid (226,006) (452,012)
---------- ----------
Net cash used in financing activities (231,192) (574,768)
---------- ----------
Net increase (decrease) in cash and
cash equivalents (124,498) 86,652
Cash and cash equivalents at beginning
of period 1,595,008 1,458,958
--------- ---------
Cash and cash equivalents at end of
period $1,470,510 $1,545,610
========== ==========
Supplemental disclosure of cash flow
information:
Cash paid during the period for
interest $ 135 $ 6,636
=========== ==========
Notes to the Financial Statements
June 30, 1996
5
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
Notes to the Financial Statements
June 30, 1996
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
- ------------------------------
The financial statements presented herein are prepared in conformity with
generally accepted accounting principles and the instructions for preparing Form
10-Q under Rule 10-01 of Regulation S-X of the Securities and Exchange
Commission and are unaudited. As such, these financial statements do not
include all information and footnote disclosures required under generally
accepted accounting principles for complete financial statements and,
accordingly, the accompanying financial statements should be read in conjunction
with the footnotes presented in the 1995 Annual Report. Except as disclosed
herein, there has been no material change to the information presented in the
footnotes to the 1995 Annual Report.
In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at June 30, 1996 and December 31, 1995 and results of operations for
the three and six month periods ended June 30, 1996 and 1995 have been made and
are reflected.
NOTE 2 - CASH
- -------------
At June 30, 1996, the Partnership had $1,465,000 invested in reverse
repurchase agreements secured by U.S. Treasury Bills or interests in U.S.
Government securities.
NOTE 3 - REVENUE RECOGNITION
- ----------------------------
Rents are payable to the Partnership monthly, quarterly or semi-annually and
no significant amounts are calculated on factors other than the passage of time.
The leases are accounted for as operating leases and are noncancellable. Rents
received prior to their due dates are deferred. Future minimum rents of
$415,280 are due as follows:
For the year ending June 30, 1997 $260,674
1998 104,949
1999 49,657
--------
Total $415,280
========
6
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
Notes to the Financial Statements
(Continued)
NOTE 4 - EQUIPMENT
- ------------------
The following is a summary of equipment owned by the Partnership at June 30,
1996. In the opinion of American Finance Group ("AFG"), the acquisition cost of
the equipment did not exceed its fair market value.
Lease Term Equipment
Equipment Type (Months) at Cost
- -------------- ---------- ---------
Aircraft 10 - 36 $ 2,845,326
Materials handling 2 - 60 1,512,503
Communications 23 - 60 383,676
Computers & peripherals 1 - 51 239,322
Retail store fixtures 12 - 47 63,750
Tractors & heavy duty trucks 78 61,036
-----------
Total equipment cost 5,105,613
Accumulated depreciation (4,291,899)
-----------
Equipment, net of accumulated depreciation $ 813,714
===========
At June 30, 1996, the Partnership's equipment portfolio included equipment
having a proportionate original cost of $3,036,520, representing approximately
59% of total equipment cost.
The summary above includes equipment held for sale or re-lease with a cost and
net book value of approximately $1,184,000 and $614,000, respectively, at June
30, 1996. This equipment includes the Partnership's proportionate interest in a
Boeing 727-251 Advanced aircraft (the "Aircraft"), formerly leased to Northwest
Airlines, Inc., having a cost and net book value of $1,080,617 and $188,019,
respectively, at June 30, 1996. This aircraft was returned upon expiration of
its lease term on November 30, 1995 and is currently undergoing heavy
maintenance expected to cost the Partnership approximately $70,000, all of which
was accrued during the three months ended March 31, 1996. The Partnership
entered into a new 28-month lease agreement with Transmeridian Airlines to re-
lease the Aircraft at a base rent to the Partnership of $8,294 per month,
effective upon completion of the heavy maintenance. In addition, at June 30,
1996, the Partnership's portfolio included a proportionate interest in two
Boeing 727-251 Advanced aircraft which were sold in July 1996 (See Note 6).
NOTE 5 - RELATED PARTY TRANSACTIONS
- -----------------------------------
All operating expenses incurred by the Partnership are paid by AFG on behalf
of the Partnership and AFG is reimbursed at its actual cost for such
expenditures. Fees and other costs incurred during each of the six month
periods ended June 30, 1996 and 1995, which were paid or accrued by the
Partnership to AFG or its Affiliates, are as follows:
7
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
Notes to the Financial Statements
(Continued)
1996 1995
--------- --------
Equipment management fees $ 15,562 $18,526
Administrative charges 6,276 6,276
Reimbursable operating
expenses due to third parties 137,282 23,612
-------- -------
Total $159,120 $48,414
======== =======
All rents and proceeds from the sale of equipment are paid directly to
either AFG or to a lender. AFG temporarily deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the Partnership.
At June 30, 1996, the Partnership was owed $66,011 by AFG for such funds and the
interest thereon. These funds were remitted to the Partnership in July 1996.
NOTE 6 - SUBSEQUENT EVENT
- -------------------------
During July 1996, the Partnership sold its interest in two Boeing 727-251
Advanced aircraft to the lessee, Northwest Airlines, Inc. The Partnership
received lease termination rents of $64,140 and sale proceeds of $148,460. At
June 30, 1996, the net carrying value of these aircraft to the Partnership was
$106,544.
8
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
FORM 10-Q
PART I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and Results
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of Operations.
- --------------
Three and six months ended June 30, 1996 compared to the three and six months
- -----------------------------------------------------------------------------
ended June 30, 1995:
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Overview
- --------
As an equipment leasing partnership, the Partnership was organized to acquire
a diversified portfolio of capital equipment subject to lease agreements with
third parties. The Partnership was designed to progress through three principal
phases: acquisitions, operations, and liquidation. During the operations
phase, a period of approximately six years, all equipment in the Partnership's
portfolio will progress through various stages. Initially, all equipment will
generate rental revenue under primary term lease agreements. During the life of
the Partnership, these agreements will expire on an intermittent basis and
equipment held pursuant to the related leases will be renewed, re-leased or
sold, depending on prevailing market conditions and the assessment of such
conditions by AFG to obtain the most advantageous economic benefit. Over time,
a greater portion of the Partnership's original equipment portfolio will become
available for remarketing and cash generated from operations and from sales or
refinancings will begin to fluctuate. Ultimately, all equipment will be sold
and the Partnership will be dissolved. The Partnership's operations commenced
in 1990.
Results of Operations
- ---------------------
For the three and six months ended June 30, 1996, the Partnership recognized
lease revenue of $135,066 and $276,219, respectively, compared to $211,845 and
$431,809 for the same periods in 1995. The decrease in lease revenue from 1995
to 1996 was expected and resulted principally from primary lease term
expirations and the sale of equipment. The Partnership also earns interest
income from temporary investments of rental receipts and equipment sales
proceeds in short-term instruments.
The Partnership's equipment portfolio includes certain assets in which the
Partnership holds a proportionate ownership interest. In such cases, the
remaining interests are owned by AFG or an affiliated equipment leasing program
sponsored by AFG. Proportionate equipment ownership enables the Partnership to
further diversify its equipment portfolio by participating in the ownership of
selected assets, thereby reducing the general levels of risk which could result
from a concentration in any single equipment type, industry or lessee. The
Partnership and each affiliate individually report, in proportion to their
respective ownership interests, their respective shares of assets, liabilities,
revenues, and expenses associated with the equipment.
For the three months ended June 30, 1996, the Partnership sold equipment
having a net book value of $7,137 to existing lessees and third parties. These
sales resulted in a net gain, for financial statement purposes, of $8,689
compared to a net gain of $95,996 on equipment having a net book value of
$73,403 for the same period in 1995.
For the six months ended June 30, 1996, the Partnership sold equipment having
a net book value of $15,481 to existing lessees and third parties. These sales
resulted in a net gain, for financial statement purposes, of $21,244 compared to
a net gain of $88,883 on equipment having a net book value of $118,016 for the
same period in 1995.
It cannot be determined whether future sales of equipment will result in a net
gain or a net loss to the Partnership, as such transactions will be dependent
upon the condition and type of equipment being sold and
9
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
FORM 10-Q
PART I. FINANCIAL INFORMATION
its marketability at the time of sale. In addition, the amount of gain or loss
reported for financial statement purposes is partly a function of the amount of
accumulated depreciation associated with the equipment being sold.
The ultimate realization of residual value for any type of equipment is
dependent upon many factors, including AFG's ability to sell and re-lease
equipment. Changing market conditions, industry trends, technological advances,
and many other events can converge to enhance or detract from asset values at
any given time. AFG attempts to monitor these changes in order to identify
opportunities which may be advantageous to the Partnership and which will
maximize total cash returns for each asset.
The total economic value realized upon final disposition of each asset is
comprised of all primary lease term revenue generated from that asset, together
with its residual value. The latter consists of cash proceeds realized upon the
asset's sale in addition to all other cash receipts obtained from renting the
asset on a re-lease, renewal or month-to-month basis. The Partnership
classifies such residual rental payments as lease revenue. Consequently, the
amount of gain or loss reported in the financial statements is not necessarily
indicative of the total residual value the Partnership achieved from leasing the
equipment.
Depreciation and amortization expense for the three and six months ended June
30, 1996 was $86,989 and $175,127, respectively, compared to $137,895 and
$292,630 for the same periods in 1995. For financial reporting purposes, to the
extent that an asset is held on primary lease term, the Partnership depreciates
the difference between (i) the cost of the asset and (ii) the estimated residual
value of the asset on a straight-line basis over such term. For purposes of
this policy, estimated residual values represent estimates of equipment values
at the date of primary lease expiration. To the extent that an asset is held
beyond its primary lease term, the Partnership continues to depreciate the
remaining net book value of the asset on a straight-line basis over the asset's
remaining economic life.
Interest expense was $2,451 and $6,031, or 1.2% and 1.4% of lease revenue for
the three and six months ended June 30, 1995, respectively. Management fees
were 4.9% and 5.6% of lease revenue for the three and six months periods ended
June 30, 1996, respectively, compared to 4.3% of lease revenue for each of the
same periods in 1995. Management fees during the six months ended June 30, 1996
include $2,088 resulting from an underaccrual in 1995. Management fees are
based on 5% of gross lease revenue generated by operating leases and 2% of gross
lease revenue generated by full payout leases.
Operating expenses consist principally of administrative charges, professional
service costs, such as audit and legal fees, as well as printing, distribution
and remarketing expenses. In certain cases, equipment storage or repairs and
maintenance costs may be incurred in connection with equipment being remarketed.
The increase in operating expenses from 1995 to 1996 is due primarily to heavy
maintenance and airframe overhaul costs incurred or accrued in connection with
certain of the Partnership's interests in Boeing 727 aircraft. The amount of
future operating expenses cannot be predicted with certainty; however, such
expenses are usually higher during the acquisition and liquidation phases of a
partnership. Other fluctuations typically occur in relation to the volume and
timing of remarketing activities.
Liquidity and Capital Resources and Discussion of Cash Flows
- ------------------------------------------------------------
The Partnership by its nature is a limited life entity which was established
for specific purposes described in the preceding "Overview". As an equipment
leasing program, the Partnership's principal operating activities derive from
asset rental transactions. Accordingly, the Partnership's principal source of
cash from operations is provided by the collection of periodic rents. These
cash inflows are used to satisfy debt service
10
AMERICAN INCOME FUND I-A
a Massachusetts Limited Partnership
FORM 10-Q
PART I. FINANCIAL INFORMATION
obligations associated with leveraged leases, and to pay management fees and
operating costs. For the six months ended June 30, 1996, operating activities
generated net cash inflows of $196,989 compared to $454,521 for the same period
in 1995. Future renewal, re-lease and equipment sale activities will continue to
cause a gradual decline in the Partnership's lease revenue and corresponding
sources of operating cash. Overall, expenses associated with rental activities,
such as management fees, and net cash flow from operating activities will also
continue to decline as the Partnership experiences a higher frequency of
remarketing events.
Ultimately, the Partnership will dispose of all assets under lease. This will
occur principally through sale transactions whereby each asset will be sold to
the existing lessee or to a third party. Generally, this will occur upon
expiration of each asset's primary or renewal/re-lease term. In certain
instances, casualty or early termination events may result in the disposal of an
asset. Such circumstances are infrequent and usually result in the collection
of stipulated cash settlements pursuant to terms and conditions contained in the
underlying lease agreements.
Cash expended for equipment acquisitions and cash realized from asset disposal
transactions are reported under investing activities on the accompanying
Statement of Cash Flows. During the six months ended June 30, 1996, the
Partnership expended $127,020 to replace certain aircraft engines to facilitate
the re-lease of this aircraft to Transmeridian Airlines, discussed below. There
were no equipment acquisitions during the same period in 1995. During the six
months ended June 30, 1996, the Partnership realized $36,725 in equipment sale
proceeds compared to $206,899 for the same period in 1995. Future inflows of
cash from asset disposals will vary in timing and amount and will be influenced
by many factors including, but not limited to, the frequency and timing of lease
expirations, the type of equipment being sold, its condition and age, and future
market conditions.
On November 30, 1995, upon the expiration of its lease term, Northwest
Airlines, Inc. ("Northwest"), returned a Boeing 727-251 Advanced aircraft (the
"Aircraft") in which the Partnership has an 11.6% ownership interest. The
Partnership's interest in the Aircraft had a cost and net book value of
$1,080,617 and $188,019, respectively, at June 30, 1996. The Aircraft is
currently undergoing heavy maintenance expected to cost the Partnership
approximately $70,000, all of which was accrued during the three months ended
March 31, 1996. The Partnership entered into a new 28-month lease agreement with
Transmeridian Airlines to re-lease the Aircraft at a base rent to the
Partnership of $8,294 per month, effective upon completion of the heavy
maintenance.
The Partnership obtained long-term financing in connection with certain
equipment leases. The repayments of principal related to such indebtedness are
reported as a component of financing activities. Each note payable is recourse
only to the specific equipment financed and to the minimum rental payments
contracted to be received during the debt amortization period (which period
generally coincides with the lease rental term). As rental payments are
collected, a portion or all of the rental payment is used to repay the
associated indebtedness. The Partnership's notes payable were fully amortized
during the six months ended June 30, 1996.
Cash distributions to the General and Limited Partners are declared and
generally paid within fifteen days following the end of each calendar quarter.
The payment of such distributions is presented as a component of financing
activities. For the six months ended June 30, 1996, the Partnership declared
total cash distributions of Distributable Cash from Operations and Distributable
Cash From Sales and Refinancings of $226,006. In accordance with the Amended
and Restated Agreement and Certificate of Limited Partnership, the Limited
Partners were allocated 95% of these distributions, or $214,706, and the General
Partner was allocated 5%, or $11,300. The second quarter 1996 cash distribution
was paid on July 15, 1996.
11
AMERICAN INCOME FUND I-A
a Massachusetts Limited Partnership
FORM 10-Q
PART I. FINANCIAL INFORMATION
Cash distributions paid to the Limited Partners consist of both a return of
and a return on capital. To the extent that cash distributions consist of Cash
From Sales or Refinancings, substantially all of such cash distributions should
be viewed as a return of capital. Cash distributions do not represent and are
not indicative of yield on investment. Actual yield on investment cannot be
determined with any certainty until conclusion of the Partnership and will be
dependent upon the collection of all future contracted rents, the generation of
renewal and/or re-lease rents, and the residual value realized for each asset at
its disposal date. Future market conditions, technological changes, the ability
of AFG to manage and remarket the assets, and many other events and
circumstances, could enhance or detract from individual asset yields and the
collective performance of the Partnership's equipment portfolio.
The future liquidity of the Partnership will be influenced by the foregoing
and will be greatly dependent upon the collection of contractual rents and the
outcome of residual activities. In July 1996, the Partnership will collect cash
of $212,600, consisting of lease termination rents equal to $64,140 and sale
proceeds equal to $148,460, from the sale of its interests in two Boeing 727-
Advanced jet aircraft to the lessee, Northwest. The amount of cash available for
distribution to the Partners in future periods will be affected by this and
other remarketing activities, which, depending upon timing, the amounts realized
and other considerations, such as market conditions and any cash reserves
retained by the Partnership, may cause the level of future quarterly cash
distributions to fluctuate. Further, equipment lease expirations and asset
disposals will cause the Partnership's net cash from operating activities to
diminish over time. In addition, the Partnership may be required to incur asset
refurbishment or upgrade costs in connection with future remarketing activities.
Notwithstanding such circumstances, the General Partner anticipates that cash
proceeds resulting from the Partnership's rental and remarketing activities will
satisfy the Partnership's future expense obligations.
12
AMERICAN INCOME FUND I-A,
a Massachusetts Limited Partnership
FORM 10-Q
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Response: None
Item 2. Changes in Securities
Response: None
Item 3. Defaults upon Senior Securities
Response: None
Item 4. Submission of Matters to a Vote of Security Holders
Response: None
Item 5. Other Information
Response: None
Item 6(a). Exhibits
Response: None
Item 6(b). Reports on Form 8-K
Response: None
13
SIGNATURE PAGE
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below on behalf of the registrant and in the capacity and
on the date indicated.
AMERICAN INCOME FUND I-A, a Massachusetts Limited Partnership
By: AFG Leasing VI Incorporated, a Massachusetts
corporation and the General Partner of
the Registrant.
By: /s/ Michael J. Butterfield
--------------------------------------------------
Michael J. Butterfield
Treasurer of AFG Leasing VI Incorporated
(Duly Authorized Officer and
Principal Accounting Officer)
Date: August 14, 1996
------------------------------------------------
By: /s/ Gary M. Romano
--------------------------------------------------
Gary M. Romano
Clerk of AFG Leasing VI Incorporated
(Duly Authorized Officer and
Principal Financial Officer)
Date: August 14, 1996
------------------------------------------------
14