-----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, QajcCa+vkbOXKMNHDkd5K2gZv7JjesbJTBQ3mgPZ4LDfuSVKDaC4/a1m/E2Xr1Y+ 1/5lnwXscg2XRWDOIRzcpA== 0000879812-00-000002.txt : 20000515 0000879812-00-000002.hdr.sgml : 20000515 ACCESSION NUMBER: 0000879812-00-000002 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000512 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATEL CASH DISTRIBUTION FUND IV L P CENTRAL INDEX KEY: 0000879812 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EQUIPMENT RENTAL & LEASING, NEC [7359] IRS NUMBER: 943145429 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-21552 FILM NUMBER: 627560 BUSINESS ADDRESS: STREET 1: 235 PINE ST STREET 2: 6TH FL CITY: SAN FRANCISCO STATE: CA ZIP: 94104 BUSINESS PHONE: 4159898800 MAIL ADDRESS: STREET 1: 235 PINE ST STREET 2: 6TH FL CITY: SAN FRANCISCO STATE: CA ZIP: 94104 10QSB 1 REPORT FOR THE FIRST QUARTER OF 2000 Form 10-QSB SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 |X| Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the quarterly period ended March 31, 2000 |_| Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. For the transition period from _______ to _______ Commission File Number 000-21552 ATEL Cash Distribution Fund IV, L.P. (Exact name of registrant as specified in its charter) California 94-3145429 ---------- ---------- (State or other jurisdiction of (I. R. S. Employer incorporation or organization) Identification No.) 235 Pine Street, 6th Floor, San Francisco, California 94104 (Address of principal executive offices) Registrant's telephone number, including area code: (415) 989-8800 Indicate by a 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 |_| DOCUMENTS INCORPORATED BY REFERENCE None 1 Part I. FINANCIAL INFORMATION Item 1. Financial Statements. 2 ATEL CASH DISTRIBUTION FUND IV, L.P. BALANCE SHEET MARCH 31, 2000 (Unaudited) ASSETS Cash and cash equivalents $ 4,829,124 Accounts receivable 433,035 Investments in leases 7,442,460 ------------------ Total assets $12,704,619 ================== LIABILITIES AND PARTNERS' CAPITAL Non-recourse debt $ 2,205,129 Accounts payable: General Partner 96,802 Other 77,912 Accrued interest payable 10,179 Unearned operating lease income 98,276 ------------------ Total liabilities 2,488,298 Partners' capital: General Partner 203,064 Limited Partners 10,013,257 ------------------ Total partners' capital 10,216,321 ------------------ Total liabilities and partners' capital $12,704,619 ================== See accompanying notes. 3 ATEL CASH DISTRIBUTION FUND IV, L.P. INCOME STATEMENTS THREE MONTH PERIODS ENDED MARCH 31, 2000 AND 1999 (Unaudited)
2000 1999 ---- ---- Revenues: Leasing activities: Operating leases $ 651,787 $ 894,736 Direct financing leases 180,615 207,251 Leveraged leases - 67,619 Gain on sale of assets 56,361 1,980,007 Interest 65,235 2,094 Other 35,189 4,851 --------------------- ------------------ 989,187 3,156,558 --------------------- ------------------ Expenses: Depreciation and amortization 283,855 537,595 Railcar maintenance 111,237 - Equipment and incentive management fees to General Partner 64,405 182,397 Interest 59,625 99,461 Administrative cost reimbursements to General Partner 43,987 30,609 Professional fees 14,297 5,959 Other 7,949 60,702 --------------------- ------------------ 585,355 916,723 --------------------- ------------------ Net income $ 403,832 $ 2,239,835 ===================== ================== Net income: General Partner $ 4,038 $ 22,398 Limited Partners 399,794 2,217,437 --------------------- ------------------ $ 403,832 $ 2,239,835 ===================== ================== Net income per Limited Partnership unit $ 0.05 $ 0.30 Weighted average number of units outstanding 7,487,350 7,487,350
STATEMENT OF CHANGES IN PARTNERS' CAPITAL THREE MONTH PERIOD ENDED MARCH 31, 2000 (Unaudited)
Limited Partners General Units Amount Partner Total Balance December 31, 1999 7,487,350 $12,234,093 $199,026 $12,433,119 Distributions to limited partners (2,620,630) - (2,620,630) Net income 399,794 4,038 403,832 ---------------- -------------------- --------------------- ------------------ Balance March 31, 2000 7,487,350 $ 10,013,257 $ 203,064 $10,216,321 ================ ==================== ===================== ==================
See accompanying notes. 4 ATEL CASH DISTRIBUTION FUND IV, L.P. STATEMENTS OF CASH FLOWS THREE MONTH PERIODS ENDED MARCH 31, 2000 AND 1999 (Unaudited)
2000 1999 ---- ---- Operating activities: Net income $ 403,832 $ 2,239,835 Adjustments to reconcile net income to net cash provided by operations: Leveraged lease income - (67,619) Depreciation and amortization 283,855 537,595 Gain on sale of asset (56,361) (1,980,007) Changes in operating assets and liabilities: Accounts receivable 1,166,377 (100,261) Accounts payable, General Partner 30,226 (353,401) Accounts payable, other (184,848) 43,251 Accrued interest payable (1,559) (2,454) Unearned operating lease income (51,507) (137,757) --------------------- ------------------ Net cash from operations 1,590,015 179,182 --------------------- ------------------ Investing activities: Reduction in investment in direct financing leases 229,860 394,994 Proceeds from sales of lease assets 149,608 3,620,439 Reduction in investment in leveraged leases - 1,240 --------------------- ------------------ Net cash provided by investing activities 379,468 4,016,673 --------------------- ------------------ Financing activities: Distributions to limited partners (2,620,630) (2,621,002) Repayment of non-recourse debt (384,288) (594,664) --------------------- ------------------ Net cash used in financing activities (3,004,918) (3,215,666) --------------------- ------------------ Net (decrease) increase in cash and cash equivalents (1,035,435) 980,189 Cash and cash equivalents at beginning of period 5,864,559 371,891 --------------------- ------------------ Cash and cash equivalents at end of period $ 4,829,124 $ 1,352,080 ===================== ================== Supplemental disclosures of cash flow information: Cash paid during period for interest $ 61,184 $ 101,915 ===================== ==================
See accompanying notes. 5 ATEL CASH DISTRIBUTION FUND IV, L.P. NOTES TO FINANCIAL STATEMENTS MARCH 31, 2000 (Unaudited) 1. Summary of significant accounting policies: Interim financial statements: The unaudited interim financial statements reflect all adjustments which are, in the opinion of the general partners, necessary to a fair statement of financial position and results of operations for the interim periods presented. All such adjustments are of a normal recurring nature. These unaudited interim financial statements should be read in conjunction with the most recent report on Form 10KSB. 2. Organization and partnership matters: ATEL Cash Distribution Fund IV, L.P. (the Partnership), was formed under the laws of the State of California on September 19, 1991, for the purpose of acquiring equipment to engage in equipment leasing and sales activities. Contributions in the aggregate of $600 were received as of October 8, 1991, $100 of which represented the General Partner's continuing interest, and $500 of which represented the Initial Limited Partners' capital investment. Upon the sale of the minimum amount of Units of Limited Partnership interest (Units) of $1,200,000 and the receipt of the proceeds thereof on March 6, 1992, the Partnership commenced operations. The Partnership's business consists of leasing various types of equipment. 3. Investment in leases: The Partnership's investment in leases consists of the following:
Depreciation Expense and Reclassi- December 31, Amortization fications and March 31, 1999 of Leases Dispositions 2000 ---- --------- - ------------- ---- Net investment in operating leases $4,402,707 $ (273,208) $ 422,828 $ 4,552,327 Net investment in direct financing leases 3,412,936 (229,860) (286,244) 2,896,832 Residual value interests 582,057 - - 582,057 Reserve for losses (652,082) - - (652,082) Assets held for sale or lease 242,793 - (229,831) 12,962 Initial direct costs, net of accumulated amortization of $911,060 in 1999 and $412,901 in 2000 61,011 (10,647) - 50,364 ------------------ -------------------- --------------------- ------------------ $8,049,422 $ (513,715) $ (93,247) $ 7,442,460 ================== ==================== ===================== ==================
ATEL CASH DISTRIBUTION FUND IV, L.P. NOTES TO FINANCIAL STATEMENTS MARCH 31, 2000 (Unaudited) 3. Investment in leases (continued): The following schedule provides an analysis of the Partnership's investment in property on operating leases by major classifications as of December 31, 1999, acquisitions and dispositions during the quarter ended March 31, 2000 and as of March 31, 2000.
Reclassi- December 31, fications and March 31, 1999 Depreciation Dispositions 2000 ---- ------------ - ------------- ---- Transportation $2,763,271 $ 513,879 $ 3,277,150 Printing 3,478,749 - 3,478,749 Construction 2,058,733 (263,984) 1,794,749 Other 272,267 (188,627) 83,640 Manufacturing 457,670 - 457,670 Ground support 1,127,988 - 1,127,988 Materials handling 291,920 - 291,920 ---------------- -------------------- --------------------- ------------------ 10,450,598 61,268 10,511,866 Less accumulated depreciation (6,047,891) $ (273,208) 361,560 (5,959,539) ---------------- -------------------- --------------------- ------------------ $4,402,707 $ (273,208) $ 422,828 $ 4,552,327 ================ ==================== ===================== ==================
All of the property on operating leases was acquired during 1992, 1993, 1994, 1995 and 1996. At March 31, 2000, the aggregate amounts of future minimum lease payments are as follows: Year ending Operating Direct Financing December 31, Leases Leases Total ------------ ------ ------ ----- 2000 $1,330,329 $ 1,191,455 $ 2,521,784 2001 1,166,277 1,086,349 2,252,626 2002 847,229 648,317 1,495,546 2003 612,330 561,360 1,173,690 2004 - 424,000 424,000 ---------------- -------------------- --------------------- $3,956,165 $ 3,911,481 $ 7,867,646 ================ ==================== ===================== 6 ATEL CASH DISTRIBUTION FUND IV, L.P. NOTES TO FINANCIAL STATEMENTS MARCH 31, 2000 (Unaudited) 4. Non-recourse debt: Notes payable to financial institutions are due in varying monthly, quarterly and semi-annual installments of principal and interest. The notes are secured by assignments of lease payments and pledges of the assets which were purchased with the proceeds of the particular notes. Interest rates on the notes vary from 6.5% to 8.85%. Future minimum principal payments of non-recourse debt are as follows: Year ending December 31, Principal Interest Total - ------------ --------- -------- ----- 2000 $1,150,917 $ 114,229 $ 1,265,146 2001 697,282 56,062 753,344 2002 250,450 19,870 270,320 2003 106,480 2,861 109,341 ---------------- -------------------- --------------------- $2,205,129 $ 193,022 $ 2,398,151 ================ ==================== ===================== 5. Related party transactions: The terms of the Limited Partnership Agreement provide that the General Partner and/or Affiliates are entitled to receive certain fees for equipment acquisition, management and resale and for management of the Partnership. The General Partner and/or Affiliates earned the following fees, commissions and reimbursements, pursuant to the Limited Partnership Agreement as follows:
2000 1999 ---- ---- Incentive management fees (computed as 5% of distributions of cash from operations, as defined in the Limited Partnership Agreement) and equipment management fees (computed as 5% of gross revenues from operating leases, as defined in the Limited Partnership Agreement plus 2% of gross revenues from full payout leases, as defined in the Limited Partnership Agreement). $ 64,405 $182,397 Administrative costs reimbursed to General Partner 43,987 30,609 ------------- ------------- $ 108,392 $ 213,006 ============= =============
7 ATEL CASH DISTRIBUTION FUND IV, L.P. NOTES TO FINANCIAL STATEMENTS MARCH 31, 2000 (Unaudited) 6. Line of credit: The Partnership participates with the General Partner and certain of its Affiliates in a $95,000,000 revolving credit agreement with a group of financial institutions which expires on July 28, 2000. The agreement includes an acquisition facility to be used by the Partnership and Affiliates to provide bridge financing for assets on leases. Draws on the acquisition facility by any individual borrower are secured only by that borrower's assets, including equipment and related leases. From July 1, 2000 through July 28, 2000, the maximum available under the line of credit shall be the then current balance or $85,000,000, which ever is less. The Partnership had no borrowings under the agreement during 2000. The credit agreement includes certain financial covenants applicable to each borrower. The Partnership was in compliance with its covenants as of March 31, 2000. 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Capital Resources and Liquidity During 2000, the Partnership's primary source of liquidity was rents from operating leases. During 1999, the Partnership's primary source of liquidity was proceeds from sales of lease assets. The liquidity of the Partnership will vary in the future, increasing to the extent cash flows from leases exceed expenses and proceeds from lease asset sales, and decreasing as distributions are made to the limited partners and to the extent expenses exceed cash flows from leases and proceeds from lease asset sales. As another source of liquidity, the Partnership has contractual obligations with a diversified group of lessees for fixed lease terms at fixed rental amounts. As the initial lease terms expire the Partnership will re-lease or sell the equipment. The future liquidity beyond the contractual minimum rentals will depend on the General Partner's success in re-leasing or selling the equipment as it comes off lease. The Partnership participates with the General Partner and certain of its affiliates in a $95,000,000 revolving line of credit with a financial institution. The line of credit expires on July 28, 2000. From July 1, 2000 through July 28, 2000, the maximum available under the line of credit shall be the then current balance or $85,000,000, which ever is less. The Partnership currently has available adequate reserves to meet contingencies, but in the event those reserves were found to be inadequate, the Partnership would likely be in a position to borrow against its current portfolio to meet such requirements. The General Partners envision no such requirements for operating purposes. Through March 31, 2000, the Partnership had borrowed approximately $38,342,000 with a remaining unpaid balance of approximately $2,205,000. Borrowings are to be generally non-recourse to the Partnership, that is, the only recourse of the lender for a default by the lessee on the underlying lease will be to the equipment or corresponding lease acquired with the loan proceeds. The General Partners expect that aggregate borrowings in the future will not exceed 40% of aggregate equipment cost. In any event, the Agreement of Limited Partnership limits such borrowings to 40% of the total cost of equipment, in aggregate. No commitments of capital have been made or are expected to be made. If inflation in the general economy becomes significant, it may affect the Partnership inasmuch as the residual (resale) values and rates on re-leases of the Partnership's leased assets may increase as the costs of similar assets increase. However, the Partnership's revenues from existing leases would not increase, as such rates are generally fixed for the terms of the leases without adjustment for inflation. If interest rates increase significantly, the lease rates that the Partnership can obtain on future leases will be expected to increase as the cost of capital is a significant factor in the pricing of lease financing. Leases already in place, for the most part, would not be affected by changes in interest rates. The Partnership made distributions of cash from 2000 first quarter operations in February, March and April 2000. The amount of the distributions totaled $.35 per Unit. This was paid in either monthly amounts of $.11667 per Unit or in one quarterly payment of $.35 per Unit in April 2000. These distributions are equal to an annualized distribution rate of 14%. 9 Cash Flows Rents from operating leases were the primary sources of cash flows from operations in the first quarter of both 2000 and 1999. The amounts of such rents decreased from 1999 to 2000 by $242,949. Sources of cash from investing activities in 2000 and 1999 consisted of the proceeds of the sales of lease assets and cash flows from direct financing leases. Proceeds from the sales of lease assets are not expected to be consistent from one period to another. Cash flows from direct financing leases decreased by $165,1344. Lease rents have declined due to lease terminations and sales of assets. In the first quarter of 2000 and 1999, there were no financing sources of cash flows. Repayments of non-recourse debt have decreased as a result of the scheduled debt payments. Results of Operations Operations in the first quarter of 2000 resulted in net income of $403,832 compared to $2,239,835 in 1999. Operating lease revenues and the related depreciation expense have decreased as a result of asset sales over the last year. Sales of these assets were not significant in the first quarter of 2000. In 1999, sales of lease assets were significantly greater and the amounts of gains recognized on those sales were also significantly higher. Sales of assets are not expected to be consistent from one period to another. Depreciation expense has decreased as a result of operating lease asset sales over the last year. As scheduled debt payments have been made over the last year, debt balances have been significantly reduced. As a result, interest expense has decreased compared to the prior year. Although total distributions to the Limited Partners was almost unchanged, a larger portion was subject to the incentive management fee in 1999 than in 2000. As a result, incentive management fees decreased from $167,925 in 1999 to $37,241 in 2000. Equipment management fees are related to gross lease rents and as those rents have decreased as a result of asset sales, the fees have decreased from $44,473 in 1999 to $25,842 in 2000. 10 PART II. OTHER INFORMATION Item 1. Legal Proceedings. Inapplicable. Item 2. Changes In Securities. Inapplicable. Item 3. Defaults Upon Senior Securities. Inapplicable. Item 4. Submission Of Matters To A Vote Of Security Holders. Inapplicable. Item 5. Other Information. Inapplicable. Item 6. Exhibits And Reports On Form 8-K. (a)Documents filed as a part of this report 1. Financial Statements Included in Part I of this report: Balance Sheet, March 31, 2000. Income statements for the three month periods ended March 31, 2000 and 1999. Statement of changes in partners' capital for the three months ended March 31, 2000. Statements of cash flows for the three month periods ended March 31, 2000 and 1999. Notes to the Financial Statements 2. Financial Statement Schedules All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted. (b) Report on Form 8-K None 11 SIGNATURES 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. Date: May 12, 2000 ATEL CASH DISTRIBUTION FUND IV, L.P. (Registrant) By: ATEL Financial Corporation General Partner of Registrant By: /s/ A. J. Batt ------------------------------------- A. J. Batt President and Chief Executive Officer of General Partner By: /s/ Dean L. Cash ------------------------------------- Dean L. Cash Executive Vice President of General Partner By: /s/ Paritosh K. Choksi ----------------------------------- Paritosh K. Choksi Principal financial officer of registrant By: /s/ Donald E. Carpenter ----------------------------------- Donald E. Carpenter Principal accounting officer of registrant EX-27 2 FDS --
5 3-MOS DEC-31-2000 DEC-31-2000 4,829,124 0 433,035 0 0 0 0 0 12,704,619 0 0 0 0 0 10,216,321 12,704,619 0 989,187 0 0 525,730 0 59,625 403,832 0 403,832 0 0 0 403,832 0 0
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