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 March 31, 1998
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________________________ to _____________
--------------------
For Quarter Ended March 31, 1998 Commission File No. 0-19134
American Income Partners V-C Limited Partnership
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Massachusetts 04-3077437
- ---------------------------------------- --------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
88 Broad Street, Boston, MA 02110
- ----------------------------------- --------------------
(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 PARTNERS V-C LIMITED PARTNERSHIP
FORM 10-Q
INDEX
Page
----
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Statement of Financial Position
at March 31, 1998 and December 31, 1997 3
Statement of Operations
for the three months ended March 31, 1998 and 1997 4
Statement of Cash Flows
for the three months ended March 31, 1998 and 1997 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 PARTNERS V-C LIMITED PARTNERSHIP
STATEMENT OF FINANCIAL POSITION
March 31, 1998 and December 31, 1997
(Unaudited)
March 31, December 31,
1998 1997
---------- ----------
ASSETS
Cash and cash equivalents $1,996,126 $1,880,014
Rents receivable 63,179 21,479
Accounts receivable - affiliate 69,403 146,113
Equipment at cost, net of accumulated depreciation
of $7,520,753 and $7,522,412 at March 31, 1998
and December 31, 1997, respectively 287,599 339,677
---------- ----------
Total assets $2,416,307 $2,387,283
---------- ----------
---------- ----------
LIABILITIES AND PARTNERS' CAPITAL
Accrued liabilities $ 9,195 $ 9,200
Accrued liabilities - affiliate 10,077 16,056
Deferred rental income 4,895 5,020
Cash distributions payable to partners 82,643 82,643
---------- ----------
Total liabilities 106,810 112,919
---------- ----------
Partners' capital (deficit):
General Partner (916,035) (917,792)
Limited Partnership Interests
(930,443 Units; initial purchase price of $25 each) 3,225,532 3,192,156
---------- ----------
Total partners' capital 2,309,497 2,274,364
---------- ----------
Total liabilities and partners' capital $2,416,307 $2,387,283
---------- ----------
---------- ----------
The accompanying notes are an integral part
of these financial statements.
3
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
STATEMENT OF OPERATIONS
for the three months ended March 31, 1998 and 1997
(Unaudited)
1998 1997
---------- ----------
Income:
Lease revenue $ 176,806 $ 287,759
Interest income 25,874 19,878
Gain on sale of equipment 10,000 18,276
---------- ----------
Total income 212,680 325,913
---------- ----------
Expenses:
Depreciation 52,078 146,509
Interest expense -- 4,587
Equipment management fees - affiliate 8,603 11,551
Operating expenses - affiliate 34,223 71,186
---------- ----------
Total expenses 94,904 233,833
---------- ----------
Net income $ 117,776 $ 92,080
---------- ----------
---------- ----------
Net income
per limited partnership unit $ 0.12 $ 0.09
---------- ----------
---------- ----------
Cash distribution declared
per limited partnership unit $ 0.08 $ 0.11
---------- ----------
---------- ----------
The accompanying notes are an integral part
of these financial statements.
4
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
for the three months ended March 31, 1998 and 1997
(Unaudited)
1998 1997
---------- ----------
Cash flows from (used in) operating activities:
Net income $ 117,776 $ 92,080
Adjustments to reconcile net income to
net cash from operating activities:
Depreciation 52,078 146,509
Gain on sale of equipment (10,000) (18,276)
Changes in assets and liabilities
Decrease (increase) in:
rents receivable (41,700) 25,777
accounts receivable - affiliate 76,710 (26,468)
Increase (decrease) in:
accrued interest -- (2,609)
accrued liabilities (5) (280)
accrued liabilities - affiliate (5,979) 3,910
deferred rental income (125) (2,318)
---------- ----------
Net cash from operating activities 188,755 218,325
---------- ----------
Cash flows from investing activities:
Proceeds from equipment sales 10,000 75,000
---------- ----------
Net cash from investing activities 10,000 75,000
---------- ----------
Cash flows used in financing activities:
Principal payments - notes payable -- (329,370)
Distributions paid (82,643) (110,184)
---------- ----------
Net cash used in financing activities (82,643) (439,554)
---------- ----------
Net increase (decrease) in cash and cash equivalents 116,112 (146,229)
Cash and cash equivalents at beginning of period 1,880,014 1,584,360
---------- ----------
Cash and cash equivalents at end of period $1,996,126 $1,438,131
---------- ----------
---------- ----------
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ -- $ 7,196
---------- ----------
---------- ----------
Supplemental schedule of non-cash activity:
The Partnership received $21,566 from a lessee prior to 1997, representing
an equipment purchase option. These funds were classified as deferred rental
income on the Statement of Financial Position at December 31, 1996. During the
three months ended March 31, 1997, the Partnership sold the equipment and
recognized these funds as sales proceeds.
The accompanying notes are an integral part
of these financial statements.
5
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
Notes to the Financial Statements
March 31, 1998
(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 1997 Annual Report. Except as
disclosed herein, there has been no material change to the information
presented in the footnotes to the 1997 Annual Report.
In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at March 31, 1998 and December 31, 1997 and results of operations for
the three month periods ended March 31, 1998 and 1997 have been made and are
reflected.
NOTE 2 - CASH
At March 31, 1998, the Partnership had $1,853,211 invested in federal
agency discount notes and 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 or quarterly 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 $658,206
are due as follows:
For the year ending March 31, 1999 $ 412,510
2000 214,048
2001 31,648
---------
Total $ 658,206
---------
---------
NOTE 4 - EQUIPMENT
The following is a summary of equipment owned by the Partnership at March
31, 1998. Remaining Lease Term (Months), as used below, represents the number of
months remaining from March 31, 1998 under contracted lease terms and is
presented as a range when more than one lease agreement is contained in the
stated equipment category. A Remaining Lease Term equal to zero reflects
equipment either held for sale or re-lease or being leased on a month-to-month
basis. In the opinion of EFG, the acquisition cost of the equipment did not
exceed its fair market value.
6
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
Notes to the Financial Statements
(Continued)
Remaining
Lease Term Equipment
Equipment Type (Months) at Cost
-------------- -------- -------
Construction and mining 0-33 $ 2,345,412
Aircraft 0-10 2,132,292
Communications 2 1,278,350
Retail store fixtures 0-9 1,144,958
Materials handling 0-12 689,753
Motor vehicles 11 212,027
Computers and peripherals 0 5,560
----------
Total equipment cost 7,808,352
Accumulated depreciation (7,520,753)
----------
Equipment, net of accumulated depreciation $ 287,599
----------
----------
At March 31, 1998, the Partnership's equipment portfolio included
equipment having a proportionate original cost of $2,132,292, representing
approximately 27% of total equipment cost.
The summary above includes equipment held for re-lease or sale with a cost
and net book value of approximately $902,000 and $197,000, respectively, at
March 31, 1998. This equipment consists of the Partnership's proportionate
interest in a Pratt & Whitney JT9D-7J jet engine, formerly leased to Southern
Air Transport, Inc. The General Partner is currently holding discussions with a
third party related to the sale of the JT9D-7J engine. In addition, the summary
above includes equipment being leased on a month-to-month basis.
NOTE 5 - RELATED PARTY TRANSACTIONS
All operating expenses incurred by the Partnership are paid by EFG on
behalf of the Partnership and EFG is reimbursed at its actual cost for such
expenditures. Fees and other costs incurred during each of the three month
periods ended March 31, 1998 and 1997, which were paid or accrued by the
Partnership to EFG or its Affiliates, are as follows:
1998 1997
-------------- ------------
Equipment management fees $ 8,603 $ 11,551
Administrative charges 13,923 8,187
Reimbursable operating expenses
due to third parties 20,300 62,999
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Total $ 42,826 $ 82,737
------------- ------------
------------- ------------
All rents and proceeds from the sale of equipment are paid directly to
either EFG or to a lender. EFG temporarily deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the Partnership.
At March 31, 1998, the Partnership was owed $69,403 by EFG for such funds and
the interest thereon. These funds were remitted to the Partnership in April
1998.
7
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
Notes to the Financial Statements
(Continued)
NOTE 6 - LEGAL PROCEEDINGS
On or about January 15, 1998, certain plaintiffs (the "Plaintiffs")
filed a class and derivative action, captioned Leonard Rosenblum, et al. v.
Equis Financial Group Limited Partnership, et al., in the United States
District Court for the Southern District of Florida (the "Court") on behalf
of a proposed class of investors in 28 equipment leasing programs sponsored
by EFG, including the Partnership (collectively, the "Nominal Defendants"),
against EFG and a number of its affiliates, including the General Partner, as
defendants (collectively, the "Defendants"). Certain of the Plaintiffs, on or
about June 24, 1997, had filed an earlier derivative action, captioned
Leonard Rosenblum, et al. v. Equis Financial Group Limited Partnership, et
al., in the Superior Court of the Commonwealth of Massachusetts on behalf of
the Nominal Defendants against the Defendants. Both actions are referred to
herein collectively as the "Class Action Lawsuit."
The Plaintiffs have asserted, among other things, claims against the
Defendants on behalf of the Nominal Defendants for violations of the Securities
Exchange Act of 1934, common law fraud, breach of contract, breach of fiduciary
duty, and violations of the partnership or trust agreements that govern each of
the Nominal Defendants. The Defendants have denied, and continue to deny, that
any of them have committed or threatened to commit any violations of law or
breached any fiduciary duties to the Plaintiffs or the Nominal Defendants.
On March 9, 1998, counsel for the Defendants and the Plaintiffs entered
into a Memorandum of Understanding setting forth the terms pursuant to which a
settlement of the Class Action Lawsuit is intended to be achieved and which,
among other things, is expected to reduce the burdens and expenses attendant to
continuing litigation. The Memorandum of Understanding represents a preliminary
step towards a comprehensive Stipulation of Settlement between the parties that
must be presented to and approved by the Court as a condition precedent to
effecting a settlement. The Memorandum of Understanding (i) prescribes a number
of conditions necessary to achieving a settlement, including providing the
partners (or beneficiaries, as applicable) of the Nominal Defendants with the
opportunity to vote on any settlement and (ii) contemplates various changes
that, if effected, would alter the future operations of the Nominal Defendants.
With respect to the Partnership and 10 affiliated partnerships (hereafter
referred to as the "Exchange Partnerships"), the Memorandum of Understanding
provides for the restructuring of their respective business operations into a
single successor company whose securities would be listed and traded on a
national stock exchange. The partners of the Exchange Partnerships would receive
both common stock in the new company and a cash distribution in exchange for
their existing partnership interests. Such a transaction would, among other
things, allow for the consolidation of the Partnership's operating expenses with
other similarly-organized equipment leasing programs. To the extent that the
parties agree upon a Stipulation of Settlement that is approved by the Court,
the complete terms thereof will be communicated to all of the partners (or
beneficiaries) of the Nominal Defendants to enable them to vote thereon.
There can be no assurance that the parties will agree upon a Stipulation
of Settlement, or that it will be approved by the Court, or that the outcome of
the voting by the partners (or beneficiaries) of the Nominal Defendants,
including the Partnership, will result in a settlement finally being effected or
in the Partnership being included in any such settlement. The General Partner
and its affiliates, in consultation with counsel, concur that there is a
reasonable basis to believe that a Stipulation of Settlement will be agreed upon
by the parties and approved by the Court. In the absence of a Stipulation of
Settlement approved by the Court, the Defendants intend to defend vigorously
against the claims asserted in the Class Action Lawsuit. The General Partner and
its affiliates cannot predict with any degree of certainty the ultimate outcome
of such litigation.
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AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Certain statements in this quarterly report of American Income Partners
V-C Limited Partnership (the "Partnership") that are not historical fact
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and are subject to a variety of risks
and uncertainties. There are a number of important factors that could cause
actual results to differ materially from those expressed in any forward-looking
statements made herein. These factors include, but are not limited to, the
outcome of the Class Action Lawsuit described in Note 6 to the accompanying
financial statements and the ability of Equis Financial
Group Limited Partnership (formerly American Finance Group), a Massachusetts
limited partnership ("EFG"), to collect all rents due under the attendant lease
agreements and successfully remarket the Partnership's equipment upon the
expiration of such leases.
The Year 2000 Issue is the result of computer programs being written using
two digits rather than four digits to define the applicable year. EFG's computer
programs were designed and written using four digits to define the applicable
year. As a result, EFG does not anticipate system failure or miscalculations
causing disruptions of operations. Based on recent assessments, EFG determined
that minimal modification of software is required so that its network operating
system will function properly with respect to dates in the year 2000 and
thereafter. EFG believes that with these modifications to the existing operating
system, the Year 2000 Issue will not pose significant operational problems for
its computer systems. EFG will utilize internal resources to upgrade software
for Year 2000 modifications and anticipates completing the Year 2000 project by
December 31, 1998, which is prior to any anticipated impact on its operating
system. The total cost of the Year 2000 project is expected to be insignificant
and have no effect on the results of operations of the Partnership.
Three months ended March 31, 1998 compared to the three months ended March 31,
1997:
Overview
The Partnership was organized in 1989 as a direct-participation equipment
leasing program to acquire a diversified portfolio of capital equipment subject
to lease agreements with third parties. The value of the Partnership's equipment
portfolio decreases over time due to depreciation resulting from age and usage
of the equipment, as well as technological changes and other market factors. In
addition, the Partnership does not replace equipment as it is sold; therefore,
its aggregate investment value in equipment declines from asset disposals
occurring in the normal course. The Partnership's stated investment objectives
and policies contemplated that the Partnership would wind-up its operations
within approximately seven years of its inception. Presently, the Partnership is
a Nominal Defendant in a Class Action Lawsuit. The outcome of the Class Action
Lawsuit could alter the nature of the Partnership's organization and its future
business operations. See Note 6 to the accompanying financial statements.
Results of Operations
For the three months ended March 31, 1998, the Partnership recognized
lease revenue of $176,806 compared to $287,759 for the same period in 1997. The
decrease in lease revenue from 1997 to 1998 was expected and resulted
principally from renewal 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 an affiliated equipment leasing program
sponsored by EFG. 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 March 31, 1998, the Partnership sold equipment
that had been fully depreciated to existing lessees and third parties. These
sales resulted in a net gain, for financial statement purposes, of
9
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
$10,000 compared to a net gain of $18,276 on equipment having a net book value
of $78,290 for the same period in 1997.
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 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 EFG'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. EFG 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 expense was $52,078 and $146,509 for the three months ended
March 31, 1998 and 1997, respectively. 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 $4,587 or 1.6% of lease revenue for the three months
ended March 31, 1997. There was no interest expense during the same period in
1998 as the Partnership's notes payable were fully amortized during the three
months ended March 31, 1997.
Management fees were approximately 4.9% and 4% of lease revenue for the
three months ended March 31, 1998 and 1997, respectively. 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. Operating expenses were $34,223 for the three months ended March 31,
1998 compared to $71,186 for the same period in 1997. Significant operating
expenses were incurred in 1997 due to heavy maintenance and airframe overhaul
costs incurred or accrued to facilitate the remarketing of two Boeing 727
aircraft in which the Partnership has an ownership interest. 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.
10
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
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 generally provided by the collection of
periodic rents. These cash inflows are used to pay management fees and operating
costs. In addition, in 1997 such cash inflows were used to satisfy debt service
obligations associated with leveraged leases. Operating activities generated net
cash inflows of $188,755 and $218,325 for the three months ended March 31, 1998
and 1997, respectively. Future renewal, re-lease and equipment sale activities
will cause a 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
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 realized from asset disposal transactions is reported under investing
activities on the accompanying Statement of Cash Flows. During the three months
ended March 31, 1998, the Partnership realized $10,000 in equipment sale
proceeds compared to $75,000 for the same period in 1997. In addition, the
Partnership received $21,566 from a lessee prior to 1997, representing an
equipment purchase option. These funds were classified as deferred rental income
on the Statement of Financial Position at December 31, 1996. During the three
months ended March 31, 1997, the Partnership sold the equipment and recognized
these funds as sales proceeds. 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.
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. The Partnership's notes payable
were fully amortized during the three months ended March 31, 1997.
Cash distributions to the General Partner and Recognized Owners 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 three months ended March 31, 1998, the
Partnership declared total cash distributions of Distributable Cash From
Operations and Distributable Cash From Sales and Refinancings of $82,643. In
accordance with the Amended and Restated Agreement and Certificate of Limited
Partnership, the Recognized Owners were allocated 95% of these distributions, or
$78,511, and the General Partner was allocated 5%, or $4,132. The first quarter
1998 cash distribution was paid on April 14, 1998.
Cash distributions paid to the Recognized Owners consist of both a return
of and a return on 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 EFG 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, as well as the outcome of the Class Action Lawsuit described in Note
6 to the accompanying financial statements. The General Partner anticipates that
cash proceeds resulting from the collection of contractual rents and the outcome
of residual activities will
11
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
satisfy the Partnership's future expense obligations. However, the amount of
cash available for distribution in future periods will fluctuate. Equipment
lease expirations and asset disposals will cause the Partnership's net cash from
operating activities to diminish over time; and equipment sale proceeds will
vary in amount and period of realization. In addition, the Partnership may be
required to incur asset refurbishment or upgrade costs in connection with future
remarketing activities. Accordingly, fluctuations in the level of future
quarterly cash distributions are anticipated.
12
AMERICAN INCOME PARTNERS V-C LIMITED PARTNERSHIP
FORM 10-Q
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Response:
Refer to Note 6 to the financial statements herein.
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 PARTNERS V-C LIMITED PARTNERSHIP
By: AFG Leasing IV Incorporated, a Massachusetts
corporation and the General Partner of the
Registrant.
By: /s/ Michael J. Butterfield
-------------------------------------------------
Michael J. Butterfield
Treasurer of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Accounting Officer)
Date: May 15, 1998
-------------------------------------------------
By: /s/ Gary M. Romano
-------------------------------------------------
Gary M. Romano
Clerk of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Financial Officer)
Date: May 15, 1998
-------------------------------------------------
14