-----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, Nq0hn1lyrXBZeHqYLP3Q4NBM2DKO68+g8FvIXphki+FisS/XVnsiEzvC1yB1prvo JhoRfXd/EOIh33zQEF5pdg== 0000948524-98-000054.txt : 19980515 0000948524-98-000054.hdr.sgml : 19980515 ACCESSION NUMBER: 0000948524-98-000054 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980331 FILED AS OF DATE: 19980514 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: POLARIS AIRCRAFT INCOME FUND IV CENTRAL INDEX KEY: 0000818145 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EQUIPMENT RENTAL & LEASING, NEC [7359] IRS NUMBER: 943039169 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 033-15551 FILM NUMBER: 98620145 BUSINESS ADDRESS: STREET 1: 201 HIGH RIDGE ROAD STREET 2: 27TH FL CITY: STAMFORD STATE: CT ZIP: 06927 BUSINESS PHONE: (203) 357- MAIL ADDRESS: STREET 1: 201 HIGH RIDGE ROAD STREET 2: 27TH FL CITY: STAMFORD STATE: CT ZIP: 06927 10-Q 1 MARCH 31, 1998 10-Q 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, 1998 OR ___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___ to ___ ---------------------- Commission File No. 33-15551 ---------------------- POLARIS AIRCRAFT INCOME FUND IV, a California Limited Partnership State of Organization: California IRS Employer Identification No. 94-3039169 201 High Ridge Road, Stamford, Connecticut 06927 Telephone - (203) 357-3776 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, and (2) has been subject to such filing requirements for the past 90 days. Yes _X_ No ___ This document consists of 11 pages. POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership FORM 10-Q - For the Quarterly Period Ended March 31, 1998 INDEX Part I. Financial Information Page Item 1. Financial Statements a) Balance Sheets - March 31, 1998 and December 31, 1997.............................................. 3 b) Statements of Operations - Three Months Ended March 31, 1998 and 1997........................................ 4 c) Statements of Changes in Partners' Capital (Deficit) - Year Ended December 31, 1997 and Three Months Ended March 31, 1998.......................... 5 d) Statements of Cash Flows - Three Months Ended March 31, 1998 and 1997.................................. 6 e) Notes to Financial Statements.................................. 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations................ 9 Part II. Other Information Item 1. Legal Proceedings............................................ 10 Item 6. Exhibits and Reports on Form 8-K............................. 10 Signature ......................................................... 11 2 Part I. Financial Information ----------------------------- Item 1. Financial Statements POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership BALANCE SHEETS (Unaudited) March 31, December 31, 1998 1997 ---- ---- ASSETS: CASH AND CASH EQUIVALENTS $ 2,068,211 $ 34,023,841 OTHER RECEIVABLES 374 - ------------ ------------ $ 2,068,585 $ 34,023,841 ============ ============ LIABILITIES AND PARTNERS' CAPITAL (DEFICIT): PAYABLE TO AFFILIATES $ 98,949 $ 190,967 ACCOUNTS PAYABLE AND ACCRUED LIABILITIES 420,901 325,984 ------------ ------------ Total Liabilities 519,850 516,951 ------------ ------------ PARTNERS' CAPITAL (DEFICIT): General Partner (7,794,458) (4,825,310) Limited Partners, 499,954 and 499,964 units outstanding in 1998 and 1997, respectively 9,343,193 38,332,200 ------------ ------------ Total Partners' Capital 1,548,735 33,506,890 ------------ ------------ $ 2,068,585 $ 34,023,841 ============ ============ The accompanying notes are an integral part of these statements. 3 POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended March 31, ---------------------------- 1998 1997 ---- ---- REVENUES: Rent from operating leases $ - $2,132,642 Interest 233,496 291,123 Other - 16,333 ---------- ---------- Total Revenues 233,496 2,440,098 ---------- ---------- EXPENSES: Depreciation and amortization - 1,350,966 Management fees to general partner - 106,632 Operating 86,562 5,318 Administration and other 96,123 79,386 ---------- ---------- Total Expenses 182,685 1,542,302 ---------- ---------- NET INCOME $ 50,811 $ 897,796 ========== ========== NET INCOME ALLOCATED TO THE GENERAL PARTNER $ 231,669 $ 258,935 ========== ========== NET INCOME (LOSS) ALLOCATED TO LIMITED PARTNERS $ (180,858) $ 638,861 ========== ========== NET INCOME (LOSS) PER LIMITED PARTNERSHIP UNIT $ (0.36) $ 1.28 ========== ========== The accompanying notes are an integral part of these statements. 4 POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT) (Unaudited) Year Ended December 31, 1997 and Three Months Ended March 31, 1998 --------------------------------- General Limited Partner Partners Total ------- -------- ----- Balance, December 31, 1996 $ (3,975,366) $ 52,044,872 $ 48,069,506 Net income 979,368 2,751,143 3,730,511 Cash distributions to partners (1,829,312) (16,463,815) (18,293,127) ------------ ------------ ------------ Balance, December 31, 1997 (4,825,310) 38,332,200 33,506,890 Net income (loss) 231,669 (180,858) 50,811 Capital redemptions (10 units) - (800) (800) Cash distributions to partners (3,200,817) (28,807,349) (32,008,166) ------------ ------------ ------------ Balance, March 31, 1998 $ (7,794,458) $ 9,343,193 $ 1,548,735 ============ ============ ============ The accompanying notes are an integral part of these statements. 5 POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31, ---------------------------- 1998 1997 ---- ---- OPERATING ACTIVITIES: Net income $ 50,811 $ 897,796 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization - 1,350,966 Changes in operating assets and liabilities: Increase in rent and other receivables (374) (45,702) Increase in other assets - (33,269) Increase (decrease) in payable to affiliates (92,018) 42 Increase (decrease) in accounts payable and accrued liabilities 94,917 (45,482) Increase in lessee security deposits - 12,827 Decrease in maintenance reserves - (151,117) ------------ ------------ Net cash provided by operating activities 53,336 1,986,061 ------------ ------------ FINANCING ACTIVITIES: Capital redemptions (800) - Cash distributions to partners (32,008,166) (2,777,578) ------------ ------------ Net cash used in financing activities (32,008,966) (2,777,578) ------------ ------------ CHANGES IN CASH AND CASH EQUIVALENTS (31,955,630) (791,517) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 34,023,841 23,989,285 ------------ ------------ CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,068,211 $ 23,197,768 ============ ============ The accompanying notes are an integral part of these statements. 6 POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership NOTES TO FINANCIAL STATEMENTS (Unaudited) 1. Accounting Principles and Policies In the opinion of management, the financial statements presented herein include all adjustments, consisting only of normal recurring items, necessary to summarize fairly Polaris Aircraft Income Fund IV's (the Partnership's) financial position and results of operations. The financial statements have been prepared in accordance with the instructions of the Quarterly Report to the Securities and Exchange Commission (SEC) Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles (GAAP). These statements should be read in conjunction with the financial statements and notes thereto for the years ended December 31, 1997, 1996, and 1995 included in the Partnership's 1997 Annual Report to the SEC on Form 10-K. 2. Related Parties Under the Limited Partnership Agreement, the Partnership paid or agreed to pay the following amounts for the current quarter to the general partner, Polaris Investment Management Corporation, in connection with services rendered or payments made on behalf of the Partnership: Payments for Three Months Ended Payable at March 31, 1998 March 31, 1998 -------------- -------------- Out-of-Pocket Administrative Expense Reimbursement $ 67,346 $ 75,851 Out-of-Pocket Operating and Remarketing Expense Reimbursement 129,498 23,098 -------- -------- $196,844 $ 98,949 ======== ======== 3. Partners' Capital The Partnership Agreement (the Agreement) stipulates different methods by which revenue, income and loss from operations and gain or loss on the sale of aircraft are to be allocated to the general partner and the limited partners. Such allocations are made using income or loss calculated under GAAP for book purposes, which varies from income or loss calculated for tax purposes. Cash available for distributions, including the proceeds from the sale of aircraft, is distributed 10% to the general partner and 90% to the limited partners. The different methods of allocating items of income, loss and cash available for distribution combined with the calculation of items of income and loss for book 7 and tax purposes result in book basis capital accounts that may vary significantly from tax basis capital accounts. The ultimate liquidation and distribution of remaining cash will be based on the tax basis capital accounts following liquidation, in accordance with the Agreement. 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations As discussed below under "Liquidity and Cash Distributions," Polaris Investment Management Corporation (PIMC, or the General Partner), is in the process of winding up the business of Polaris Aircraft Income Fund IV (the Partnership). During 1997, the Partnership sold its remaining portfolio of 13 used commercial jet aircraft out of its original portfolio of 33 aircraft. Partnership Operations The Partnership reported net income of $50,811, which, after allocation in accordance with the partnership agreement, resulted in a net loss of $0.36 per limited partnership unit, for the three months ended March 31, 1998, compared to net income of $897,796, or $1.28 per unit, for the same period in 1997. The decline in operating results during the three months ended March 31, 1998, as compared to the same period in 1997, was primarily due to the sale of the Partnership's remaining aircraft in 1997. Interest income decreased during the three months ended March 31, 1998, as compared to the same period in 1997, primarily due to a decrease in the cash reserves in 1998. The decrease in the cash reserves resulted from cash distributions, as discussed in the liquidity section. Another factor contributing to the decrease in interest income was the absence of interest income on the deferred rent payments due from Continental that ended when the final payment was made in 1997. Operating expenses increased during the three months ended March 31, 1998 as compared to the same period in 1997, due to an increase in legal expenses related to the sale of the remaining aircraft. Administration and other expenses increased during the three months ended March 31, 1998 as compared to the same period in 1997, due to increases in printing and postage costs related to an additional distribution. Liquidity and Cash Distributions Liquidity - As previously discussed, the Partnership sold its remaining aircraft during 1997. Polaris Investment Management Corporation, the general partner, has determined that the Partnership maintain cash reserves as a prudent measure to ensure that the Partnership has available sufficient funds to satisfy anticipated contingencies and expenses in connection with winding up its business. The Partnership's cash reserves will be monitored and may be revised from time to time as further information becomes available in the future. Cash Distributions - Cash distributions to limited partners were $28,807,349 or $57.62 per limited partnership unit, and $2,499,820 or $5.00 per limited partnership unit during the three months ended March 31, 1998 and 1997, respectively. The increase, as compared to 1997, is due to the distribution of the proceeds received from the prepayment of a note due from Triton Aviation Services IV LLC on December 30, 1997. The Partnership is now in the process of winding up its business. With the exception of reserves maintained for anticipated expenses and costs of winding up, the Partnership distributed all of its available cash during 1997 and the first quarter of 1998. Consequently, the timing and amount of future cash distributions, if any, are not yet known and will depend upon whether the Partnership's reserves exceed its actual expenses and contingencies in winding up and on the time required to complete the winding up process. 9 Part II. Other Information -------------------------- Item 1. Legal Proceedings As discussed in Item 3 of Part I of Polaris Aircraft Income Fund IV's (the Partnership) 1997 Annual Report to the Securities and Exchange Commission on Form 10-K (Form 10-K), there are a number of pending legal actions or proceedings involving the Partnership. There have been no material developments with respect to any such actions or proceedings during the period covered by this report. Other Proceedings - Item 10 in Part III of the Partnership's 1997 Form 10-K discusses certain actions which have been filed against Polaris Investment Management Corporation and others in connection with the sale of interests in the Partnership and the management of the Partnership. The Partnership is not a party to these actions. There have been no material developments with respect to any of the actions described therein during the period covered by this report. Item 6. Exhibits and Reports on Form 8-K a) Exhibits (numbered in accordance with Item 601 of Regulation S-K) 27. Financial Data Schedule (in electronic format only). b) Reports on Form 8-K A Current Report on Form 8-K, dated December 30, 1997, reporting a prepayment in full of the Promissory Note from Triton Aviation Services IV LLC, was filed on January 5, 1998. 10 SIGNATURE Pursuant to the requirements of section 13 or 15(d) 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. POLARIS AIRCRAFT INCOME FUND IV, A California Limited Partnership (Registrant) By: Polaris Investment Management Corporation, General Partner May 13, 1998 By: /S/Marc A. Meiches - ----------------------------- -------------------------------- Marc A. Meiches Chief Financial Officer (principal financial officer and principal accounting officer of Polaris Investment Management Corporation, General Partner of the Registrant) 11 EX-27 2
5 3-MOS DEC-31-1998 MAR-31-1998 2068211 0 374 0 0 0 0 0 2068585 0 0 0 0 0 1548735 2068585 0 233496 0 0 182685 0 0 50811 0 50811 0 0 0 50811 (0.36) 0
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