-----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, Fqtlr8h9k+aSi/x0Kt4vH9uKEHgnx7YrISQe+rc6GZ0kOZS3mPentcyR0MWcWBNM YULszXJ5ZMQFDO4cIJBjCg== 0000799179-96-000008.txt : 19960801 0000799179-96-000008.hdr.sgml : 19960801 ACCESSION NUMBER: 0000799179-96-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960731 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: 96601678 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 June 30, 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 or other jurisdiction of (I.R.S. Employer Identification incorporation or organization) 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)
June 30 December 31 1996 1995 ------ ----------- ASSETS: Cash $ 421,792 $ 1,129,581 Accounts receivable 0 61,845 Net investment in direct financing leases 340,787 733,873 Equipment on operating leases, net of accumulated depreciation of $2,201,123 in 1996 and $2,201,123 in 1995 0 0 Equipment held for sale or lease, net of accumulated depreciation of $-0- in 1996 and $-0- in 1995. 0 0 -------- --------- Total assets $ 762,579 $ 1,925,299 ======== ========= LIABILITIES AND PARTNERS' CAPITAL: Liabilities: Payables to affiliates $ 8,665 $ 2,872 Accounts payable 49,060 69,823 Deposits 72,543 150,246 Prepaid rental income 19,422 33,801 Distributions payable 94,737 631,580 ------- -------- Total liabilities 244,427 888,322 ------- -------- Partners' capital: Partners' capital 518,152 1,036,977 ------- --------- Total partners' capital 518,152 1,036,977 ------- --------- Total liabilities & partners' capital $762,579 $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)
Six Months Quarter Ended Ended June 30 June 30 1996 1995 1996 1995 ---- ---- ---- ---- Revenue: Rental income $116,084 $ 156,497 57,818 83,948 Direct financing lease income 37,062 302,424 19,365 185,981 Gain (loss) on sale of equipment 0 54,313 0 14,883 Interest income 6,348 13,525 2,088 7,547 Other income 42,472 596,029 0 592,057 ------- --------- ------- ------- Total revenues 201,966 1,122,788 79,271 884,416 ------- --------- ------- ------- Expenses: Management fees 39,979 192,792 18,062 136,775 General & administrative 96,171 101,428 48,921 61,583 Data processing 14,109 18,759 6,352 9,424 lnterest expense 2,113 29,112 601 7,214 ------- --------- ------- ------- Total expenses 152,372 342,091 73,936 214,996 ------- --------- ------- ------- Net Income $ 49,594 $ 780,697 $ 5,335 $669,420 ======= ========= ====== ======= Net income per limited partnership unit $ 0.46 $ 7.27 $ 0.05 $ 6.24 ======= ======== ====== =======
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)
Six Months Ended June 30 1996 1995 ____ ____ Cash flows from operating activities: Net income $ 49,594 780,697 Adjustments to reconcile net income to net cash provided by operating activities: Gain on disposition of equipment 0 (54,313) Change in assets and liabilities: Decrease in accounts receivable 61,845 1,484 Increase (decrease) in payable to affiliates 5,793 (1,792) Decrease in accounts payable (20,763) (44,667) Decrease in deposits (77,702) (151,260) (Decrease) increase in prepaid rental income (14,379) 5,531 (Decrease) increase in distributions payable (536,842) 663,152 --------- --------- Net cash (used) provided by operating activities (532,454) 1,198,832 --------- --------- Cash flows from investing activities: Proceeds from disposition of equipment 0 207,065 Decrease in net investment in direct financing leases 393,086 1,733,377 --------- --------- Net cash provided by investing activities 393,086 1,940,442 --------- --------- Cash flows from financing activities: Repayment of notes payable 0 (305,610) Net distributions to partners (568,421) (1,841,992) --------- --------- Net cash used in financing activities (568,421) (2,147,602) --------- --------- Net (decrease) increase in cash (707,789) 991,672 Cash at beginning of period 1,129,581 928,298 --------- --------- Cash at end of period $ 421,792 $ 1,919,970 ========= =========
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 June 30, 1996, June 30, 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 June 30, 1996, June 30, 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 ten 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 tenth 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 lease portfolio is invested in Direct Finance leases which terminate with the lessee's contractually required purchase of equipment. The income of the Registrant is rapidly declining as the lease portfolio size declines. The cash balances and related interest income fluctuates according to the cash flow from rents and finance lease termination payments during each quarter. Cash is distributed to the Partners according to their respective tax basis capital accounts. It is anticipated that the Partners will receive a return of approximately 70% of their original investment because of shortfalls in portfolio performance and a difficult economic environment during the life of the Partnerhsip. The Registrant reported a net income of $49,594 or $0.46 per Limited Partnership Unit for the six months ended June 30, 1996 as compared to net income of $780,697 or $7.27 per Limited Partnership Unit for the six months ended June 30, 1995. Total revenues for the six months ended June 30, 1996, were $201,966 compared to $1,122,788 for the same period in the prior year. This decrease reflects a reduced rental income from both operating and finance leases due to the gradual liquidation of the Registrant's lease portfolio. 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 June 30, 1995, to June 30, 1996, ($302,424 to $37,062 respectively). The net investment in direct financing leases decreased from $1,185,261 at June 30, 1995, to $340,787 at June 30, 1996. Interest income decreased because the Registrant held lower cash balances due to distributions to Partners and lease termination's during the first six 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. 7 Total expenses for the six months ended June 30, 1996, were $152,372 compared to $342,091 for the same period in the prior year. Management fees, interest, and general and administrative costs comprised 91% of the total expenses. Interest expense decreased from June 30, 1995, to June 30, 1996, ($29,112 to $2,113 respectively). General and administrative costs decreased from $101,428 for the first six months of 1995 to $96,171 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 for Regulatory and Partner reporting which will continue at their current level until the Registrant's final close of operations. Liquidity and Capital Resources _______________________________ Cash used by operating activities for the six months ended June 30, 1996, was $532,454 compared to cash provided of $1,198,832 for the same period in the prior year. The decrease in cash from operating activities reflects the continued winding down of the operating lease portfolio and large decrease in distributions payable to Partners. Cash provided by investing activities decreased from $1,940,442 in the first half of 1995 to $393,086 for the first half of 1996, reflecting the lack of sales from the remaining operating lease equipment in the first half of 1996, lease terminations and fluctuation of rental receipts from the direct finance lease portfolio. As rental payment on finance leases are received, the cash is broken up into income and return of principal. As a finance lease ages the income portion of the rental receipts decreases and the return of principal portion increases. Cash provided by investing activities was used to repay notes payable of $305,610 in the first six months of 1995 compared to $-0- for the same period in 1996. As of June 30, 1996, the Fund's partners were allocated cash distributions of $94,737 payable on July 15, 1996. The size of investor distributions depend on the timing of lease termination's and collections of rents. As a result of the decreasing portfolio of leases, this amount can be expected to decrease during 1996. The cash balance increased from $928,298 at December 31, 1994, to $1,919,970 at June 30, 1995, and decreased from $1,129,581 at December 31, 1995, to $421,792 at June 30, 1996. The cash position as of June 30, 1996, was $421,792. The General Partner anticipates that funds from operations will be adequate to cover all operating expenses of the Partnership during 1996. 8 PART II. OTHER INFORMATION Item 1. Legal Proceeding 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. 8 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: July 29, 1996 By: _____________________________ Ernest V. Lavagetto, President EX-27 2
5 6-MOS DEC-31-1995 JAN-01-1996 JUN-30-1996 421,793 0 340,787 0 0 762,579 0 0 762,579 244,427 0 0 0 0 518,152 762,579 201,966 201,966 0 0 152,372 0 0 49,594 0 0 0 0 0 49,594 0.46 0.46
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