-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EtNi+GotcHDSqEqotyvgjJhydS3PrYr2d4G9dni/Qv1ILFAs3KwkwS6ozkfwg6yq YyQIneVPnL+aCwS937Snaw== 0000799179-96-000004.txt : 19960430 0000799179-96-000004.hdr.sgml : 19960430 ACCESSION NUMBER: 0000799179-96-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960429 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LEASTEC INCOME FUND IV CENTRAL INDEX KEY: 0000799179 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER RENTAL & LEASING [7377] IRS NUMBER: 680100223 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 033-08115 FILM NUMBER: 96552362 BUSINESS ADDRESS: STREET 1: 2855 MITCHELL DR STE 215 CITY: WALNUT CREEK STATE: CA ZIP: 94598 BUSINESS PHONE: 4159383443 MAIL ADDRESS: STREET 1: 2855 MITCHELL DRIVE SUITE 215 STREET 2: 2855 MITCHELL DRIVE SUITE 215 CITY: WALNUT CREEK STATE: CA ZIP: 94598 10-Q 1 FORM 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended March 31, 1996 Commission file number 338115 Leastec Income Fund IV, A California Limited Partnership (Exact name of registrant as specified in its charter) California 68-0100223 (State of other jurisdiction of (I.R.S. Employer Identifi incorporation or organization) cation Number) 2855 Mitchell Drive, Suite 215, Walnut Creek, California 94598 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (510) 938-3443 ________________________________________________________________________ (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: N/A 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. Yes ___ No ___ APPLICABLE ONLY TO CORPORATE ISSUERS: N/A Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. 2 Part 1. Financial Information LEASTEC INCOME FUND IV A California Limited Partnership CONDENSED BALANCE SHEETS (Unaudited) March 31 December 31 1996 1995 ASSETS: Cash $ 773,981 $1,129,581 Accounts receivable 31,550 61,845 Net investment in direct financing leases 482,575 733,873 Equipment on operating leases, net of accumulated depreciation of $2,201,123 in 1996 and $2,201,123 in 19950 0 0 Equipment held for sale or lease, net of accumulated depreciation of $-0-in 1996 and $-0- in 1995 0 0 __________ __________ Total assets $1,288,106 $1,925,299 ========== ========== LIABILITIES AND PARTNERS' CAPITAL: Liabilities: Payables to affiliates $ 2,872 $ 2,872 Accounts payable 36,282 69,823 Deposits 137,379 150,246 Prepaid rental income 30,335 33,801 Distributions payable 473,684 631,580 _________ __________ Total liabilities 680,552 888,322 _________ __________ Partners' capital: Partners' capital 607,554 1,036,977 _________ _________ Total partners' capital 607,554 1,036,977 _________ _________ Total liabilities & partners' capital $1,288,106 $1,925,299 ========= ========= The accompanying notes are an integral part of these condensed financial statements. 3 LEASTEC INCOME FUND IV A California Limited Partnership CONDENSED STATEMENTS OF INCOME (Unaudited) Three Months Ended March 31 1996 1995 Revenue: Rental income $ 58,266 $ 72,549 Direct financing lease income 17,697 116,443 Gain on sale of equipment 0 39,430 Interest income 4,260 5,978 Other income (loss) 42,472 3,972 _______ _______ Total revenues 122,695 238,372 _______ _______ Expenses: Management fees $ 21,917 $ 56,017 General & administrative 40,559 39,845 Data processing 7,757 9,335 Bad debt 6,690 0 Interest expense 1,512 21,898 _______ _______ Total expenses 78,435 127,095 _______ _______ Net Income $ 44,260 $111,277 ======= ======= Net income per limited partnership unit $ 0.41 $ 1.04 ======= ======= The accompanying notes are an integral part of these condensed financial statements. 4 LEASTEC INCOME FUND IV A California Limited Partnership STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31 1996 1995 ____ ____ Cash flows from operating activities: Net income $ 44,260 $111,277 Adjustments to reconcile net income to net cash provided by operating activities: Gain on disposition of equipment 0 (39,430) Change in assets and liabilities: Decrease(increase) in accounts 30,295 (98,747) receivable Decrease in payable to affiliates 0 (16,731) Decrease in accounts payable (33,541) (75,433) Decrease in deposits (12,866) (19,160) Decrease (increase) in prepaid rental income (3,466) 5,651 Decrease in distributions payable (157,896) (126,316) ________ _______ Net cash used by operating activities (133,214) (258,889) ________ _______ Cash flows from investing activities: Proceeds from disposition of equipment 0 39,430 Decrease in net investment in direct financing leases 251,298 585,744 _______ _______ Net cash provided by investing activities 251,298 625,174 _______ _______ Cash flows from financing activities: Repayment of notes payable 0 (104,696) Net distributions to partners (473,684) (526,317) _______ _______ Net cash used in financing activities (473,684) (631,013) _______ _______ Net Decrease in cash (355,600) (264,728) Cash at beginning of period 1,129,581 928,298 _________ ________ Cash at end of period $ 773,981 $663,570 ========= ======= The accompanying notes are an integral part of these condensed financial statements. 5 LEASTEC INCOME FUND IV A California Limited Partnership NOTES TO CONDENSED FINANCIAL STATEMENTS MARCH 31, 1996, MARCH 31, 1995 AND DECEMBER 31, 1995 (Unaudited) 1. Basis of Condensed Financial Statement Preparation __________________________________________________ In the opinion of the General Partner, the accompanying unaudited condensed financial statements contain all adjustments (consisting principally of normal, recurring accruals) necessary to present fairly the financial position of Leastec Income Fund IV (the Partnership) as of March 31, 1996, March 31, 1995 and December 31, 1995. As provided for in the Partnership agreement and offering document, the Partnership engaged in leasing activities which intended to be completed in approximately eleven years from its inception at which time all remaining partnership assets will have been liquidated and cash proceeds distributed to the registrant's partners. The Partnership has presented its 1996 financial statements to reflect its leasing activities on a basis consistent with prior periods. 2. Wind Down Phase _______________ The Registrant has ceased acquisition of new capital equipment and is in the process of liquidating its lease portfolio. It is intended that the Registrant will be fully liquidated at the end of its eleventh full year of operation, December 1996. 6 LEASTEC INCOME FUND IV A California Limited Partnership MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operation The Registrant has been winding down operations since 1993 by discontinuing new leasing activities and returning cash available from operations to the Registrant's Partners. Although the Registrant has until December 1997 to liquidate operations, the Registrant intends to be fully liquidated by December 1996. In order to complete the liquidation of all assets by the end of 1996, it is the General Partner's policy to allow the early termination of leases when requested, as well as to seek the sale of leased assets in which the lease may extend beyond December 1996. This is the Registrant's final year of operation. The majority of the Registrant's operating leases have terminated. The remaining leases were fully depreciated in the first half of 1995. As operating leases terminate, the equipment is sold. The remaining balance of the lease portfolio is invested in Direct Finance leases which terminate with the lessee's contractually required purchase of equipment. The income and expenses of the Registrant are steadily declining as the lease portfolio size declines. The cash balances and related interest income fluctuate according to the cash flow from rents and equipment and finance lease sales during each quarter. Cash is distributed to the Partners according to their respective tax basis capital accounts. The Partners will not receive a 100% return of their original investment because of shortfalls in the portfolio performance during the life of the Partnership. The Registrant reported a net income of $44,260 or $0.41 per Limited Partnership Unit for the three months ended March 31, 1996, as compared to net income of $111,277 or $1.04 per Limited Partnership Unit for the Three months ended March 31, 1995. Total revenues for the three months ended March 31, 1996, were $122,695 compared to $238,372 for the same period in the prior year. This decrease, due to the shrinking lease portfolio, was not as large as anticipated due to other income of $42,472 for the first quarter. The other income was generated by a certain lessee's penalty for failure to give proper notice of termination. Revenue derived from the Fund's equipment management activities comprised 97% of the total income for the period, with the remaining 3% being interest income. Direct financing lease income decreased from March 31, 1995, to March 31, 1996, ($116,443 to $17,697 respectively). The net investment in direct financing leases decreased from $733,873 at March 31, 1995, to $482,575 at March 31, 1996. 7 Interest income decreased because the Registrant held slightly lower cash balances due to lease termination's, sales and partner distributions during the first three months of 1996 as compared to the same period in the prior year. All available cash is being paid out in distributions to the Fund's partners on a quarterly basis. Total expenses for the three months ended March 31, 1996, were $78,435 compared to $127,095 for the same period in the prior year. Management fees, interest, and general and administrative costs comprised 88% of the total expenses. Interest expense decreased from March 31, 1995 to March 31, 1996, ($21,898 to $1,512 respectively). The gain on sale of equipment for the three months ended March 31, 1996, was $-0- as compared to $39,430 for the same period in 1995. Since of operating leases having been terminated and sold there are limited sources remaining for gains on sale. The contractually obligated purchase of direct financing leases usually does not generate a gain or loss on sale of equipment. General and administrative costs remained fairly constant from $39,845 for the first three months of 1995 to $40,559 for the same period in 1996. The variable expenses of the Registrant have been reduced steadily as the liquidation progressed. There are certain fixed expenses caused by the Partnership Agreement's requirements, Regulatory and Partner reporting which will continue at this level until the Registrants final close of operations. Liquidity and Capital Resources Cash used by operating activities for the three months ended March 31, 1996, was $133,214 compared to $258,889 for the same period in the prior year. Cash provided by investing activities decreased from $625,174 for the three months ended March 31, 1995, to, $251,298 for the same period in 1996, reflecting primarily the shrinking lease portfolio and the aging of rental receipts from the direct finance leases. As rental payments on finance leases are received, the cash is broken up into income and return of principal. As a finance lease the income portion of the rental receipts decrease and the return of principal portion increases. Cash provided by investing activities was used to repay $-0- of debt during the three months ended March 31,1996 as compared to $104,696 for the same period in the prior year. As of March 31, 1996, the Fund's partners were allocated cash distributions of $473,684 payable on April 15, 1996. The size of investor distributions depend on the lease termination's and collections of rents. As a result of the decreasing portfolio of leases, this amount can be expected to gradually decrease during 1996. 8 The cash balance decreased from $928,298 at December 31, 1994, to $663,570 at March 31, 1995, to $1,129,581 at December 31, 1995 and decreased to $773,981 at March 31, 1996. The cash position as of March 31, 1996, was $773,981. The General Partner anticipates that funds from operations will be adequate to cover all operating expenses of the Partnership during 1996. 9 PART II. OTHER INFORMATION Item 1. Legal Proceedings None. Item 2. Changes in Securities None. Item 3. Defaults Upon Senior Securities None. Item 4. Submission of Matters to a Vote of Security Holders None. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits None. (b) Reports on Form 8-K None. 10 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. LEASTEC INCOME FUND IV (Registrant) LEASTEC CORPORATION (General Partner) Date: April 28, 1996 By: _________________________ Ernest V. Lavagetto, President EX-27 2
5 3-MOS DEC-31-1996 JAN-01-1996 MAR-31-1996 773,981 0 514,125 0 0 1,288,106 0 0 1,288,106 680,552 0 0 0 0 607,554 1,288,106 122,695 122,695 0 0 70,233 6,690 1,512 44,260 0 0 0 0 0 44,260 .41 .41
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