-----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, Eji1a6rN7KDEQkMN+xjAloEJhNFJ7HO07tPJiyl3jzm5Es574ppLYMLs01ayVMDX RHXv/gG1moEvwPTst4cgCg== 0000914317-98-000260.txt : 19980417 0000914317-98-000260.hdr.sgml : 19980417 ACCESSION NUMBER: 0000914317-98-000260 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980416 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN LEASING INVESTORS VIII-B L P CENTRAL INDEX KEY: 0000783270 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER RENTAL & LEASING [7377] IRS NUMBER: 133275939 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: SEC FILE NUMBER: 000-15801 FILM NUMBER: 98595207 BUSINESS ADDRESS: STREET 1: 411 WEST PUTNAM AVE CITY: GREENWICH STATE: CT ZIP: 06830 BUSINESS PHONE: 2038627000 MAIL ADDRESS: STREET 1: 411 WEST PUTNAM AVE CITY: GREENWICH STATE: CT ZIP: 06830 10-K/A 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A Amendment No. 1 Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended Commission File December 31, 1997 Number 0-15801 AMERICAN LEASING INVESTORS VIII-B, L.P. (Exact name of Registrant as specified in its charter) Delaware 13-3275939 (State or other jurisdiction (IRS Employer of incorporation or organization) Identification No.) 411 West Putnam Avenue, Greenwich, CT 06830 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 203-862-7444 Securities registered pursuant to Section 12(b) of the Act: NONE Securities registered pursuant to Section 12(g) of the Act: UNITS OF LIMITED PARTNERSHIP INTEREST, $500 PER UNIT Indicate by check mark whether 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 [ ] There is no public market for the Limited Partnership Units. Accordingly, information with respect to the aggregate market value of Limited Partnership Units held by non-affiliates of Registrant has not been supplied. Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K [ X ]. Documents Incorporated by Reference Location in Form 10-K in Which Document Document is Incorporated - -------- ------------------------ Registrant's Prospectus, dated Part IV March 26, 1986 as supplemented on November 11, 1986 Exhibit Index: page IV-1 PART I Item 1. Business General Registrant was formed on November 6, 1985 under the Delaware Revised Uniform Limited Partnership Act with ALI Equipment Management Corp. (the "Managing General Partner"), ALI Capital Corp. (the "Corporate General Partner"), and CDG Associates (the "Associate General Partner"), as general partners. The Associate General Partner, the Managing General Partner and the Corporate General Partner, are collectively referred to herein as the "General Partners." Through November 2, 1994, the Managing General Partner and the Corporate General Partner were wholly-owned subsidiaries of Integrated Resources, Inc. ("Integrated"). On November 3, 1994, as a result of the consummation of the reorganization plan relating to Integrated's bankruptcy, indirect ownership of the Managing General Partner and the Corporate General Partner was purchased by Presidio Capital Corp. ("Presidio"). As of February 28, 1995, Presidio Boram Corp., a subsidiary of Presidio replaced CDG Associates as the Associate General Partner. On August 28, 1997, an affiliate of NorthStar Capital Partners acquired all of the Class B shares of Presidio, the corporate parent of the General Partners. This acquisition, when aggregated with previous acquisitions, caused NorthStar Capital Partners to acquire indirect control of the General Partners. Presidio was also party to an Administrative Services Agreement with Wexford Management LLC ("Wexford") pursuant to which Wexford was responsible for the day-to-day management of Presidio and, among other things, had authority to designate directors of the General Partners. On November 2, 1997, the Administrative Services Agreement between Presidio and Wexford expired. Effective November 3, 1997, Wexford and Presidio entered into a new Administrative Services Agreement (the "ASA"), which expires on May 3, 1998. Under the terms of the ASA, Wexford will provide consulting and administrative services to Presidio and its affiliates, including the General Partners. Presidio also entered into a management agreement with NorthStar Presidio Management Company, LLC ("NorthStar Presidio"). Under the terms of the management agreement, NorthStar Presidio will provide the day-to-day management of Presidio and its direct or indirect subsidiaries and affiliates. Effective November 3, 1997, the officers and employees of Wexford that had served as officers and/or Directors of the General Partners tendered their resignations. On the same date, the Board of Directors of Presidio appointed new individuals to serve as officers and/or directors of the General Partners. Registrant had owned one (1) British Aerospace HS 125-800A aircraft (the "DuPont Aircraft") which had been leased to a third party pursuant to a full payout lease through January 31, 1997 and certain packaging line equipment leased to a third party. Registrant does not engage in any other business or any foreign operation and thus a presentation of information about industry segments or geographic areas is not relevant. In an offering, which terminated on December 12, 1986, Registrant sold 20,440 units of limited partnership interest (the "Units") for gross proceeds aggregating $10,220,000. As of December 31, 1987, substantially all of the net proceeds available for investment had been invested in equipment. During the fiscal years ended December 31, 1997, 1996 and 1995, the leasing of transportation equipment constituted approximately 83%, 95% and 94% of Registrant's rental revenues and the leasing of photocopying, telephone and telecommunications and packaging line equipment constituted approximately 17%, 5% and 6% of Registrant's rental revenues. Registrant's rental revenues were derived primarily from lease payments from lessees of its equipment. None of such lessees are affiliated with Registrant. During the fiscal year ended December 31, 1997, lease payments from the following lessees were the source of 10% percent or more of Registrant's gross rental revenues: E.I. DuPont de Nemours and Co. ("DuPont") was the source of approximately 83% with respect to the DuPont Aircraft and Xerox Corporation ("Xerox") was the source of approximately 17% with respect to certain packaging line equipment. The lease of the DuPont Aircraft expired on January 21, 1997 in accordance with its original terms. The associated debt was repaid upon the receipt of the final rental installment. The lessee continued to utilize the DuPont Aircraft until January 31, 1997 at which time the DuPont Aircraft was made available for return inspection on January 31, 1997. On April 16, 1997, Registrant sold the DuPont Aircraft to an unaffiliated third party for a purchase price of $5,400,000, exclusive of selling expenses of approximately $118,000. At the time of the sale, the DuPont Aircraft had a net carrying value of approximately $3,041,800. In early July 1994, upon the receipt of the final rental installment, the original lease of certain packaging line equipment (the "Packaging Line Equipment") was scheduled to expire. In addition, the associated nonrecourse debt was repaid upon the receipt of the final rental installment. The lessee exercised its right to renew the lease through December 1995, in accordance with its "Fair Market Rental Value" renewal option, at a fair market rental rate equal to approximately 42% of the original rent. The foregoing rate was not agreed upon until October 1995. Since January 1, 1996, Registrant and the lessee have attempted to reach agreement for either a lease extension or a sale of the Packaging Line Equipment. Notwithstanding the absence of an agreement on a lease extension, and without the consent of Registrant, the lessee continued to utilize the Packaging Line Equipment while failing to pay any rent. Registrant and the lessee were unable to reach an agreement and, on April 17, 1997, Registrant commenced an action against the lessee. This action was settled during the course of trial which is described in Part 1, Item 3. See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Item 8, "Financial Statements and Supplemental Data," for further information. Recent Developments In January 1998, Registrant received proposed notices of assessment from the City of New York, Department of Finance with respect to Unincorporated Business Tax ("UBT") of approximately $130,000 for the years 1992, 1993 and 1994. The City of New York is alleging that UBT is owed by Registrant with respect to conducting business in New York City. Final assessments have not yet been issued. Registrant intends to vigorously contest the assessment. Although there can be no assurance that Registrant will be successful in its contest of the assessment, Registrant believes the assessment is without merit. Registrant has not recorded any provision or liability as a result of the proposed notices of assessment. Competition At December 31, 1997, Registrant's remaining asset in its portfolio was the Packaging Line Equipment which was sold in January 1998. Employees Registrant does not have any employees. NorthStar Presidio currently performs accounting, secretarial, transfer and administrative services for Registrant. NorthStar Presidio also performs similar services for other affiliates of the Managing General Partner. Integrated Resources Equipment Group, Inc. ("IREG"), an indirect subsidiary of Presidio, manages Registrant's equipment portfolio pursuant to a Management Agreement. See Item 10, "Directors and Executive Officers of Registrant," Item 11, "Executive Compensation," and Item 13, "Certain Relationships and Related Transactions." In April 1995, the Managing General Partner and certain affiliates entered into an agreement with Fieldstone Private Capital Group, L.P. ("Fieldstone") pursuant to which Fieldstone performs certain management and administrative services relating to Registrant as well as to certain other partnerships in which the Managing General Partner serves as general partner. Substantially all costs associated with the retention of Fieldstone are paid by the Managing General Partner. The agreement with Fieldstone was scheduled to expire on November 3, 1997. The Managing General Partner and certain affiliates are currently negotiating a possible extension of the agreement. Fieldstone has indicated that it will continue to perform services with respect to Registrant pending the conclusion of such negotiation. Item 2. Properties As of March 1, 1998, Registrant did not have any interest in equipment. (1) (1) See Item 1, "Business," and Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" for additional information. Item 3. Legal Proceedings On June 30, 1994, Registrant's lease of certain Packaging Line Equipment with Xerox was scheduled to expire in accordance with the original lease terms (the "Xerox Lease"). Upon receipt of the final rental installment due under the Xerox Lease the associated nonrecourse debt was repaid. In late 1993, Xerox had notified Registrant of its intent to exercise its right to extend the Xerox Lease and Xerox and Registrant commenced negotiations to determine the fair market rental value of the Packaging Line Equipment. Pursuant to the terms of the Xerox Lease, Xerox had the right to elect to extend the Xerox Lease for two consecutive periods of one year each. In October 1995, Registrant and Xerox agreed upon a lease rate for an eighteen month lease renewal which expired on December 31, 1995. Since January 1, 1996, Registrant and Xerox have attempted to reach agreement for either a lease extension or a sale of the Packaging Line Equipment. Notwithstanding the absence of an agreement on a lease extension, and without the consent of Registrant, Xerox continued to utilize the Packaging Line Equipment while failing to pay any rent. Registrant and Xerox were unable to reach an agreement and, on April 17, 1997, Registrant commenced an action against Xerox in the Supreme Court of the State of New York, County of New York, seeking compensation and punitive damages relating to Xerox's retention of the Packaging Line Equipment. This action was settled during the course of trial. Xerox, during the course of the litigation, remitted to Registrant the fair market rental value of approximately $31,000 for the two year period from January 1, 1996 through December 31, 1997, as well as a purchase amount for the equipment of approximately $82,000 at January 1, 1998. Item 4. Submission of Matters to a Vote of Security Holders None. PART II Item 5. Market for Registrant's Common Equity and Related Stockholder Matters There is no developed public market for the Units of Registrant. As of March 1, 1998, there were approximately 900 record holders of Units of Registrant, owning an aggregate of 20,442 Units. During the past two fiscal years, Registrant made the following cash distributions with respect to the Units to holders thereof as of the dates set forth below in the amounts set forth opposite such dates:
Distribution with respect to Amount of Distribution Per Unit (1) Quarter Ended 1997 1996 ---------- ---------- March 31 ........................ $ -- $ -- June 30 ......................... $ 252.00 $ -- September 30 .................... $ -- $ -- December 31 ..................... $ -- $ --
(1) The amount listed represents distribution of cash from the sale of the DuPont Aircraft. (See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations", for information relating to Registrant's future distributions). Registrant's quarterly cash from operations reached minimal levels at the end of 1995 and the costs associated with making quarterly cash distributions remain fixed; therefore, the Managing General Partner had decided to discontinue quarterly cash distributions (except that it is anticipated that cash from sales would be distributed with respect to the quarter in which such sales were made). Registrant does not anticipate that it will make any additional distributions until it resolves the issues associated with the tax examination of the Unincorporated Business Tax. See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," for additional information relating to Registrant's ability to make future cash distributions. Item 6. Selected Financial Data
Year ended December 31, ------------------------------------------------------------------------------------ 1997 1996 1995 1994 1993 ------------- --------------- -------------- -------------- --------------- Revenues (1) $ 121,256 $ 927,775 $ 947,892 $ 1,454,168 $ 2,365,043 Net Income (Loss) (1) $ 2,070,316 $ 238,389 $ 886,943 $ (101,662) $ (129,467) Net Income (Loss) Per Unit $ 100.26 $ 11.55 $ 42.95 $ (4.92) $ (6.27) Distribution Per Unit $ 252.00 $ - $ 17.00 $ 10.00 $ 29.00 Total Assets $ 245,725 $ 3,413,378 $ 4,036,097 $ 7,220,488 $ 8,418,078 Long-term Obligations $ - $ - $ 791,382 $ 4,268,227 $ 5,163,456 Total Partners' Equity $ 182,343 $ 3,315,445 $ 3,077,056 $ 2,541,133 $ 2,849,280
(1) Not included in revenues are gains from the disposition of equipment of $2,240,193, $736,487, $4,730 and $18,908 for the years ended December 31, 1997, 1995, 1994 and 1993, respectively. Such gains are included in Net Income (Loss). See Item 8, "Financial Statements and Supplemental Data" and Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations," for a discussion of certain dispositions of equipment which may cause the data reflected herein not to be indicative of Registrant's future financial condition or results of operations. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources Registrant made cash distributions to limited partners with respect to 1997 of $252.00 per Unit. As of December 31, 1997, approximately 4% of Registrant's equipment, on an original cost basis, remained in its portfolio consisting solely of the Packaging Line Equipment which was sold effective January 1, 1998. As of December 31, 1997, Registrant had operating reserves of approximately $177,000 (or approximately $8.57 per Unit), which was comprised of undistributed cash from operations and sales of approximately $74,800, as well as the original working capital of $102,200 (1% of original offering proceeds). Set forth below is a description of various transactions which have impacted the liquidity of Registrant during 1996 and 1997: i) On December 21, 1996, the debt associated with the lease of the DuPont Aircraft was repaid upon the receipt of the final rental installment. On January 21, 1997, the lease of the DuPont Aircraft expired in accordance with its term. The associated debt was repaid upon the receipt of Registrant's final rental installment. The lessee continued to utilize the DuPont Aircraft, with the Registrant's consent, until January 31, 1997 at which time the DuPont Aircraft was made available for its return inspection. On April 16, 1997, Registrant sold the DuPont Aircraft to an unaffiliated third party for a purchase price of $5,400,000, exclusive of selling expenses of approximately $118,000. At the time of sale, the DuPont Aircraft had a net carrying value of approximately $3,041,800. ii) In early July 1994, upon the receipt of the final rental installment during the initial lease term associated with the Packaging Line Equipment, the associated nonrecourse debt was repaid. The lessee of the Packaging Line Equipment exercised its right to renew the lease through December 1995, in accordance with its "Fair Market Rental Value" renewal option at a fair market rental rate equal to approximately 42% of the original rent. Since January 1, 1996, Registrant and the lessee have attempted to reach agreement for either a lease extension or a sale of the Packaging Line Equipment. Notwithstanding the absence of an agreement on a lease extension, and without the consent of Registrant, the lessee continued to utilize the Packaging Line Equipment while failing to pay any rent. Registrant and the lessee were unable to reach an agreement and, on April 17, 1997, Registrant commenced an action against the lessee. The action was settled during the course of trial which is described in Part I, Item 3. The Packaging Line Equipment had a net carrying value of $5,308 and $78,259 at December 31, 1997 and 1996, respectively. At December 31, 1997, Registrant's remaining asset was the Packaging Line Equipment which was sold to Xerox on January 1, 1998. The Managing General Partner has decided to discontinue quarterly cash distributions until the resolution of the tax examination relating to Unincorporated Business Tax. It is Registrant's intention to maintain reserves (including the original working capital reserve) sufficient to support Registrant's future obligations. Upon the consummation of the resolution of the tax examination relating to Unincorporated Business Tax, the Managing General Partner will then prepare a final accounting of Registrant's assets and liabilities, commence the dissolution and termination of Registrant and make a final distribution to partners. Inflation and changing prices have not had any material effect on Registrant's revenues since its inception nor does Registrant anticipate any material effect on its business from these factors. Registrant had no outstanding material commitments for capital expenditures as of December 31, 1997. Year 2000 Costs associated with the year 2000 conversion are not expected to have any impact on the Registrant's operations. Results of Operations for 1997 as Compared to 1996 Registrant's rental revenue decreased for the year ended December 31, 1997 as compared to the year ended December 31, 1996. The decrease was primarily due to the expiration of the lease of the DuPont Aircraft on January 21, 1997. This was partially offset by the interest earned on the proceeds generated from the sale of the DuPont Aircraft available for short term investment. Costs and expenses decreased for 1997 as compared to 1996 due to: (i) less depreciation on the DuPont Aircraft which was sold on April 16, 1997, (ii) reduced interest expense due to the repayment of debt in January 1997 associated with the DuPont Aircraft , (iii) lower equipment management fees due to reduced rentals on which such fee is based, (iv) offset by an increase in general and administrative expenses due to increased legal fees and an increase in operating expenses related to the DuPont Aircraft. Registrant's net income for 1997 was approximately $2,070,000 as compared to net income of approximately $238,000 for 1996. The principal reason for the increase in net income was the gain on the disposition of equipment recognized in 1997 of approximately $2,240,000. The increase in net income was partially offset by the increase in general and administrative expenses. Results of Operations for 1996 as Compared to 1995 Registrant's rental revenues for the year ended December 31, 1996 decreased slightly as compared to the year ended December 31, 1995. Interest expense decreased by approximately 65% for 1996 as compared to 1995, due to the continued reduction of the principal amount of outstanding indebtedness by the application of rental payments on the leveraged transaction. Operating expenses decreased by approximately 48% for 1996 as compared to 1995, primarily due to the reduction of maintenance and administrative expenses associated with leases. General and administrative expenses decreased approximately 35% for 1996 as compared to 1995, primarily due to a decrease in legal and auditing expenses in 1996. Fees to affiliates decreased by approximately 19% for 1996 as compared to 1995, due primarily to the decrease in equipment management fees resulting from a reduction in rental revenues on which such fees are based as well as to the absence of partnership management fees during 1996 Registrant's net income for 1996 was approximately $238,000 as compared to net income of approximately $887,000 for 1995. The principal reason for the change was the gain on the disposition on the foreclosure of the Hawaiian Aircraft recognized in 1995 of approximately $736,000. The decrease in net income was offset primarily by a decrease in interest expense from approximately $105,000 in 1995 to approximately $37,000 in 1996. Item 8. Financial Statements and Supplemental Data AMERICAN LEASING INVESTORS VIII-B, L.P. FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 INDEX Independent Auditor's Report Financial statements - years ended December 31, 1997, 1996 and 1995 Balance sheets Statements of income Statement of partners' equity Statements of cash flows Notes to financial statements Schedule: II -- Valuation and Qualifying Accounts All other schedules have been omitted because they are inapplicable or the information is included in the financial statements or notes thereto. AMERICAN LEASING INVESTORS VIII-B, L.P. FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 To the Partners of American Leasing Investors VIII-B, L.P. Greenwich, Connecticut INDEPENDENT AUDITOR'S REPORT We have audited the accompanying balance sheets of American Leasing Investors VIII-B, L.P. (a limited partnership) as of December 31, 1997 and 1996, and the related statements of income, partners' equity and cash flows for each of the three years in the period ended December 31, 1997. Our audits also included the financial statement schedule listed in the Index at Item 14(a)2. These financial statements and the financial statement schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of American Leasing Investors VIII-B, L.P. as of December 31, 1997 and 1996, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1997 in conformity with generally accepted accounting principles. Also, in our opinion, such financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. As discussed in Note 4, the Partnership sold its remaining asset effective January 1, 1998, and as a result, has completed the liquidation of its asset portfolio. Pending the resolution of a tax claim against the Partnership which is discussed in Note 10, the Partnership anticipates making a final distribution to its partners and dissolving shortly thereafter. /s/Hays & Company - ----------------- Hays & Company February 13, 1998 New York, New York
AMERICAN LEASING INVESTORS VIII-B, L.P. BALANCE SHEETS December 31, ------------------------- 1997 1996 ---------- ---------- ASSETS Cash and cash equivalents ................................. $ 208,631 $ 201,251 Other receivables and prepaid expenses .................... 31,786 50,633 Leased equipment - net .................................... 5,308 3,161,494 ---------- ---------- $ 245,725 $3,413,378 ========== ========== LIABILITIES AND PARTNERS' EQUITY Liabilities Accounts payable and accrued expenses ..................... $ 62,765 $ 44,108 Due to affiliates ......................................... 617 4,025 Deferred income ........................................... -- 49,800 ---------- ---------- Total liabilities .................................. 63,382 97,933 ---------- ---------- Commitments and contingencies (Notes 3, 4, 8 and 10) Partners' equity Limited partners' equity (as restated) (20,442 units issued and outstanding) ....................................... 179,530 3,281,301 General partners' equity (as restated) .................... 2,813 34,144 ---------- ---------- Total partners' equity ............................. 182,343 3,315,445 ---------- ---------- $ 245,725 $3,413,378 ========== ==========
See notes to financial statements.
AMERICAN LEASING INVESTORS VIII-B, L.P. STATEMENTS OF INCOME Year ended December 31, -------------------------------------------- 1997 1996 1995 ----------- ----------- ----------- Revenues Rental .................................. $ 89,278 $ 916,317 $ 922,188 Other, principally interest ............. 31,978 11,458 25,704 ----------- ----------- ----------- 121,256 927,775 947,892 ----------- ----------- ----------- Costs and expenses General and administrative .............. 131,278 61,943 96,006 Depreciation ............................ 114,380 570,089 570,088 Other ................................... 33,680 -- -- Operating ............................... 11,795 1,700 3,245 Interest ................................ -- 37,328 105,351 Fees to affiliates ...................... -- 18,326 22,746 ----------- ----------- ----------- 291,133 689,386 797,436 ----------- ----------- ----------- (169,877) 238,389 150,456 Gain on sale of equipment (Note 9) ........... 2,240,193 -- 736,487 ----------- ----------- ----------- Net income ................................... $ 2,070,316 $ 238,389 $ 886,943 =========== =========== =========== Net income attributable to Limited partners ........................ $ 2,049,613 $ 236,005 $ 878,074 General partners ........................ 20,703 2,384 8,869 ----------- ----------- ----------- $ 2,070,316 $ 238,389 $ 886,943 =========== =========== =========== Net income per unit of limited partnership interest (20,442 units outstanding) ..... $ 100.26 $ 11.55 $ 42.95 =========== =========== ===========
See notes to financial statements.
AMERICAN LEASING INVESTORS VIII-B, L.P. STATEMENT OF PARTNERS' EQUITY YEARS ENDED DECEMBER 31, 1995, 1996 AND 1997 Limited General Total Partners' Partners' Partners' Equity Equity Equity ----------- ----------- ----------- Balance, January 1, 1995 ..................... $ 2,616,942 $ (75,809) $ 2,541,133 Reallocation of partners' equity (Note 6) .... (102,210) 102,210 -- ----------- ----------- ----------- Balance, January 1, 1995 (as restated) ....... 2,514,732 26,401 2,541,133 Net income - 1995 ............................ 878,074 8,869 886,943 Distributions to partners ($17.00 per limited partnership unit) ....................... (347,510) (3,510) (351,020) ----------- ----------- ----------- Balance, December 31, 1995 (as restated) ..... 3,045,296 31,760 3,077,056 Net income - 1996 ............................ 236,005 2,384 238,389 ----------- ----------- ----------- Balance, December 31, 1996 (as restated) ..... 3,281,301 34,144 3,315,445 Net income - 1997 ............................ 2,049,613 20,703 2,070,316 Distributions to partners ($252.00 per limited partnership unit) ....................... (5,151,384) (52,034) (5,203,418) ----------- ----------- ----------- Balance, December 31, 1997 ................... $ 179,530 $ 2,813 $ 182,343 =========== =========== ===========
See notes to financial statements.
STATEMENTS OF CASH FLOWS AMERICAN LEASING INVESTORS VIII-B, L.P. Year ended December 31, --------------------------------------------- 1997 1996 1995 ----------- ----------- ----------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS Cash flows from operating activities Net income ....................................... $ 2,070,316 $ 238,389 $ 886,943 Adjustments to reconcile net income to net cash (used in) provided by operating activities Depreciation .............................. 114,380 570,089 570,088 Gain on sale of equipment ................. (2,240,193) -- (736,487) Changes in assets and liabilities Accounts receivable ........................... -- -- 38,408 Other receivables and prepaid expenses ........ 18,847 (48,799) 2,529 Accounts payable and accrued expenses ......... 18,657 (26,707) (6,016) Deferred income ............................... (49,800) -- 49,800 Due to affiliates ............................. (3,408) (1,721) 3,920 ----------- ----------- ----------- Net cash (used in) provided by operating activities ................. (71,201) 731,251 809,185 ----------- ----------- ----------- Cash flows from investing activities Proceeds from disposition of equipment ........... 5,281,999 -- -- ----------- ----------- ----------- Cash flows from financing activities Distributions to partners ........................ (5,203,418) (41,297) (309,723) Principal payments on notes payable .............. -- (791,382) (780,927) ----------- ----------- ----------- Net cash used in financing activities ..... (5,203,418) (832,679) (1,090,650) ----------- ----------- ----------- Net increase (decrease) in cash and cash equivalents ...................................... 7,380 (101,428) (281,465) Cash and cash equivalents, beginning of year .......... 201,251 302,679 584,144 ----------- ----------- ----------- Cash and cash equivalents, end of year ................ $ 208,631 $ 201,251 $ 302,679 =========== =========== =========== Supplemental disclosure of cash flow information Interest paid .................................... $ -- $ 39,109 $ 118,771 =========== =========== ===========
On August 3, 1995, the Hawaiian Airlines, Inc. ("Hawaiian") lender foreclosed on the Hawaiian aircraft and the Partnership removed the net carrying value of the Hawaiian airacraft of approximately $2,292,000 and the related nonrecourse notes and accrued interest payable of approximately $2,991,000 from its respective accounts (Note 9) See notes to financial statements. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 1 ORGANIZATION American Leasing Investors VIII-B, L.P. (the "Partnership") was organized under the Delaware Revised Uniform Limited Partnership Act as of November 6, 1985 for the purpose of investing in and leasing equipment principally in the United States. The Partnership will terminate on December 31, 2010, or sooner, in accordance with the terms of the Agreement of Limited Partnership (the "Limited Partnership Agreement"). Limited partners' units were originally issued at a price value of $500 per unit. A total of 20,442 units of limited partnership interest were issued for aggregate capital contributions of $10,221,000. In addition, the general partners contributed a total of $1,000 to the Partnership. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Leases The Partnership accounts for all of its leases in accordance with the operating method. Under this method, revenue is recognized on a straight-line basis and expenses (including depreciation) are charged to operations as incurred. Leased equipment and equipment held for sale The cost of leased equipment and equipment held for sale represents the initial cost of the equipment to the Partnership plus miscellaneous acquisition and closing costs, and is carried at the lower of depreciated cost or net realizable value. Depreciation is computed using the straight-line method over the estimated useful lives of such assets (15 years for transportation equipment and 10 years for packaging line equipment). Depreciation is not taken on equipment held for sale. When equipment is sold or otherwise disposed of, the cost and accumulated depreciation (and any related allowance for equipment impairment) are removed from the accounts and any gain or loss on such sale or disposal is reflected in operations. Normal maintenance and repairs are charged to operations as incurred. The Partnership provides allowances for equipment impairment based upon a quarterly review of all equipment in its portfolio, when management believes that, based upon market analysis, appraisal reports and leases currently in place with respect to specific equipment, the investment in such equipment may not be recoverable. The allowance is inherently subjective and is based upon management's best estimate of current conditions and assumptions about expected future conditions. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Financial statements The financial statements include only those assets, liabilities and results of operations, which relate to the business of the Partnership. Cash and cash equivalents For the purpose of the statements of cash flows, the Partnership considers all short-term investments, which have original maturities of three months or less from the date of issuance to be cash equivalents. Substantially all of the Partnership's cash and cash equivalents are held at one financial institution. Net income and distributions per unit of limited partnership interest Net income and distributions per unit of limited partnership interest are computed based upon the number of units outstanding (20,442) during the year. Income taxes No provisions have been made for federal, state and local income taxes, since they are the personal responsibility of the partners. The income tax returns of the Partnership are subject to examination by federal, state and local taxing authorities. Such examinations could result in adjustments to Partnership income, which changes could effect the income tax liability of the individual partners. Reclassifications Certain reclassifications have been made to the financial statements shown for the prior years in order to conform to the current year's classifications. Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Recently issued accounting pronouncements The Financial Accounting Standards Board has recently issued several new accounting pronouncements. Statement No. 128, "Earnings Per Share" established standards for computing and presenting earnings per share, and became effective for financial statements for both interim and annual periods ending after December 15, 1997. Statement No. 129, "Disclosure of Information about Capital Structure" established standards for disclosing information about an entity's capital structure, and became effective for financial statements for periods ending after December 15, 1997. Statement No. 130, "Reporting Comprehensive Income" establishes standards for reporting and display of comprehensive income and its components, and is effective for fiscal years beginning after December 15, 1997. Statement No. 131, "Disclosures about Recently issued accounting pronouncements Segments of an Enterprise and Related Information" establishes standards for the way that public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in interim financial reports issued to shareholders. It also establishes standards for related disclosures about products and services, geographic areas, and major customers, and is effective for financial statements for periods beginning after December 15, 1997. Management of the Partnership does not believe that these new standards have, or will have a material effect on the Partnership's reported operating results, per unit amounts, financial position or cash flows. 3 CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES The corporate general partner of the Partnership, ALI Capital Corp. (the "Corporate General Partner"), the managing general partner of the Partnership, ALI Equipment Management Corp. ("Equipment Management") and Integrated Resources Equipment Group, Inc. ("IREG") were wholly owned subsidiaries of Integrated Resources, Inc. ("Integrated") through November 2, 1994. On November 3, 1994, as a result of the consummation of the reorganization plan relating to Integrated's bankruptcy, indirect ownership of the Corporate General Partner, Equipment Management and IREG was purchased by Presidio Capital Corp. ("Presidio"). CDG Associates was the associate general partner of the Partnership through February 27, 1995. On February 28, 1995, Presidio AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 3 CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES (continued) Boram Corp., a subsidiary of Presidio, became the associate general partner. Other limited partnerships and similar investment programs have been formed by Equipment Management or its affiliates to acquire equipment and, accordingly, conflicts of interest may arise between the Partnership and such other limited partnerships. Affiliates of Equipment Management have also engaged in businesses related to the management of equipment and the sale of various types of equipment and may transact business with the Partnership. Subject to the rights of the limited partners under the Limited Partnership Agreement, Presidio controls the Partnership through its direct or indirect ownership of all of the shares of Equipment Management, the Corporate General Partner and, as of February 28, 1995, the associate general partner. On August 28, 1997, an affiliate of NorthStar Capital Partners acquired all of the Class B shares of Presidio, the corporate parent of the general partners. This acquisition, when aggregated with previous acquisitions, caused NorthStar Capital Partners to acquire indirect control of the general partners. Presidio was also party to an Administrative Services Agreement with Wexford Management LLC ("Wexford") pursuant to which Wexford was responsible for the day-to-day management of Presidio and, among other things, had authority to designate directors of the general partners. On November 2, 1997, the Administrative Services Agreement between Presidio and Wexford expired. Effective November 3, 1997, Wexford and Presidio entered into a new Administrative Services Agreement (the "ASA") which expires on May 3, 1998. Under the terms of the ASA, Wexford will provide consulting and administrative services to Presidio and its affiliates, including the general partners and the Partnership. Presidio also entered into a management agreement with NorthStar Presidio Management Company, LLC ("NorthStar Presidio"). Under the terms of the management agreement, NorthStar Presidio will provide the day-to-day management of Presidio and its direct and indirect subsidiaries and affiliates. Effective November 3, 1997, officers and employees of Wexford that had served as officers and/or directors of the general partners tendered their resignations. On the same date, the Board of Directors of Presidio appointed new individuals to serve as officers and/or directors of the general partners. The Partnership has a management agreement with IREG, pursuant to which IREG receives 5% of annual gross rental revenues on operating leases; 2% of annual gross rental revenues on full payout leases which contain net lease provisions; and 1% of annual gross rental revenues, if services are performed by third parties under the active supervision of IREG, as defined in the Limited Partnership Agreement. During the years ended December 31, 1996 and 1995, the Partnership incurred expenses of $18,326 and $18,444, respectively, for such management services. No such fees were incurred during the year ended December 31, 1997. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 3 CONFLICTS OF INTEREST AND TRANSACTIONS WITH RELATED PARTIES (continued) During the operating and sale stage of the Partnership, IREG is entitled to a partnership management fee equal to 4% of distributable cash from operations, as defined in the Limited Partnership Agreement, subject to increase after the limited partners have received certain specified minimum returns on their investment. During the year ended December 31, 1995, the Partnership incurred partnership management fees of $4,302. Such amounts are included in fees to affiliates in the statements of income. No partnership management fees were incurred for the years ended December 31, 1997 and 1996. The general partners are entitled to 1% of distributable cash from operations and cash from sales and an allocation of 1% of taxable net income or loss of the Partnership. During the operating and sale stage of the Partnership, IREG may be entitled to receive certain other fees which are subordinated to the receipt by the limited partners of their original invested capital and certain specified minimum returns on their investment. Upon the ultimate liquidation of the Partnership, the general partners may be required to remit to the Partnership certain payments representing capital account deficit restoration based upon a formula provided within the Limited Partnership Agreement. In April 1995, Equipment Management and certain affiliates entered into an agreement with Fieldstone Private Capital Group, L.P. ("Fieldstone") pursuant to which Fieldstone performs certain management and administrative services relating to the Partnership as well as to certain other partnerships in which Equipment Management serves as general partner. Substantially all costs associated with the retention of Fieldstone are paid by Equipment Management. The agreement with Fieldstone was scheduled to expire on November 3, 1997. Equipment Management and certain affiliates are currently negotiating a possible extension of the agreement. Fieldstone has indicated that it will continue to perform services with respect to the Partnership pending the conclusion of such negotiation. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 4 LEASED EQUIPMENT Leased equipment is summarized as follows:
December 31, -------------------------- 1997 1996 ---------- ---------- Transportation equipment (net of accumulated depreciation of $4,799,637 in 1996) ........ $ -- $3,083,235 Packaging line equipment (net of accumulated depreciation of $805,268 and $732,317) ..... 5,308 78,259 ---------- ---------- $ 5,308 $3,161,494 ========== ==========
The lease of the Partnership's transportation equipment expired during January 1997 and the equipment was sold on April 16, 1997 (Note 9). On June 30, 1994, the Partnership's lease of certain Packaging Line Equipment with Xerox was scheduled to expire in accordance with the original lease terms (the "Xerox Lease"). Upon receipt of the final rental installment due under the Xerox Lease the associated nonrecourse debt was repaid. In late 1993, Xerox had notified the Partnership of its intent to exercise its right to extend the Xerox Lease and Xerox and the Partnership commenced negotiations to determine the fair market rental value of the Packaging Line Equipment. Pursuant to the terms of the Xerox Lease, Xerox had the right to elect to extend the Xerox Lease for two consecutive periods of one year each. In October 1995, the Partnership and Xerox agreed upon a lease rate for an eighteen month lease renewal which expired on December 31, 1995. Since January 1, 1996, the Partnership and Xerox have attempted to reach agreement for either a lease extension or a sale of the Packaging Line Equipment. Notwithstanding the absence of an agreement on a lease extension, and without the consent of the Partnership, Xerox continued to utilize the Packaging Line Equipment while failing to pay any rent. The Partnership and Xerox were unable to reach an agreement and, on April 17, 1997, the Partnership commenced an action against Xerox in the Supreme Court of the State of New York, County of New York, seeking compensation and punitive damages relating to Xerox's retention of the Packaging Line Equipment. This action was settled during the course of trial in early 1998. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 4 LEASED EQUIPMENT (continued) Xerox, during the course of the litigation, remitted to the Partnership the fair market rental value of approximately $31,000 for the two year period from January 1, 1996 through December 31, 1997, as well as a purchase amount for the equipment of approximately $82,000 which is effective as of January 1, 1998. 5 ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consist of the following:
December 31 -------------------------- 1997 1996 ------- ------- Professional fees ........................ $57,670 $23,811 Operating expenses ....................... 3,362 1,058 Sales and income taxes ................... 1,733 19,239 ------- ------- $62,765 $44,108 ======= =======
6 PARTNERS' EQUITY The General Partners hold a 1% equity interest in the Partnership. At the inception of the Partnership, the General Partners' equity account was credited with only the actual capital contributed in cash, $1,000. The Partnership's management determined that this accounting does not appropriately reflect the limited partners' and the General Partners' relative participations in the Partnership's net assets, since it does not reflect the General Partners' 1% equity interest in the Partnership. Thus, the Partnership has restated its financial statements to reallocate $102,210 (1% of the gross proceeds raised at the Partnership's formation) of the partners' equity to the General Partners' equity account. This reallocation was made as of the inception of the Partnership and all periods presented in the financial statements have been restated to reflect this reallocation. The reallocation has no impact on the Partnership's financial position, results of operations, cash flows, distributions to partners, or the partners' tax basis capital accounts. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 7 RECONCILIATION OF NET INCOME AND NET ASSETS PER FINANCIAL STATEMENTS TO TAX BASIS The Partnership filed its tax return on a cash basis until 1987 when, as a requirement of the Tax Reform Act of 1986, it was converted to the accrual basis of accounting eliminating, over time, most timing differences with the exception of accelerated depreciation for tax purposes. A reconciliation of net income per financial statements to the tax basis of accounting is as follows:
Year ended December 31, -------------------------------------------- 1997 1996 1995 ----------- ----------- ----------- Net income per financial statements ................... $ 2,070,316 $ 238,389 $ 886,943 Financial statement depreciation in excess of tax depreciation 114,380 532,347 522,895 Difference between financial statements and tax basis of equipment sold or disposed of 3,008,757 -- 2,291,901 Accrued expenses ............... 67,328 -- -- Difference between financial statements and tax basis of advanced rental payments ..... (49,800) -- 49,800 ----------- ----------- ----------- Net income per tax basis ....... $ 5,210,981 $ 770,736 $ 3,751,539 =========== =========== ===========
The differences between the Partnership's net assets per financial statements and tax basis of accounting are as follows.
December 31, ------------------------------ 1997 1996 ----------- ----------- Net assets per financial statements ...... $ 182,343 $ 3,315,445 Net carrying value of equipment .......... (5,308) (3,128,445) Syndication costs ........................ 1,149,750 1,149,750 Accrued expenses ......................... 67,328 -- Deferred income .......................... -- 49,800 ----------- ----------- Net assets per tax basis ................. $ 1,394,113 $ 1,386,550 =========== ===========
AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 8 MAJOR LESSEES Revenues from equipment leased to individual lessees, which generated 10% or more of rental revenues, are as follows:
Year ended December 31, ------------------------------------ 1997 1996 1995 -------- -------- -------- One Hawker Siddeley 125-800A aircraft $ 73,871 $866,575 $866,575 % of rental revenues ................. 83% 95% 94% Packaging Line Equipment ............. $ 15,407 $ -- -- % of rental revenues ................. 17% -% -%
9 EQUIPMENT SALES DuPont Aircraft On January 21, 1997, the lease of the British Aerospace HS 125-800A aircraft (the "DuPont Aircraft") owned by the Partnership, expired in accordance with its original terms. The associated debt was repaid upon the receipt of the final rental installment. The lessee continued to utilize the DuPont Aircraft, with the Partnership's consent, until January 31, 1997 at which time the DuPont Aircraft was made available for its return inspection. On April 16, 1997, the Partnership sold the DuPont Aircraft to an unaffiliated third party for $5,400,000, exclusive of selling expenses of approximately $118,000. At the time of sale, the DuPont Aircraft had a net carrying value of approximately $3,041,800. Hawaiian Aircraft On September 21, 1993, Hawaiian Airlines, Inc. ("Hawaiian"), filed for reorganization under Chapter 11 of the United States Bankruptcy Code. Hawaiian had leased two de Havilland DHC Dash 7 Series 102 aircraft (collectively the "Hawaiian Aircraft"), owned by the Partnership, pursuant to two separate leases (the "Hawaiian Leases"). The Hawaiian Aircraft were subject to nonrecourse financing (the "Hawaiian Loans") provided by an unaffiliated third party lender (the "Hawaiian Lender"). Hawaiian emerged from bankruptcy on September 12, 1994, and on September 28, 1994, it returned the Hawaiian Aircraft, which had been retired from Hawaiian's fleet since April 18, 1994, to a designated agent of the Hawaiian Lender. In September 1994, the Hawaiian Aircraft were placed into storage in California at the Hawaiian Lender's expense. AMERICAN LEASING INVESTORS VIII-B, L.P. NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1997, 1996 and 1995 9 EQUIPMENT SALES (continued) Hawaiian Aircraft (continued) As a result of a variety of factors, the Partnership believed that there was a limited market for the Hawaiian Aircraft. Accordingly, the Partnership had determined that it would not make any payments to cure the defaults on the Hawaiian Loans. On August 3, 1995, the Hawaiian Lender foreclosed on the Hawaiian Aircraft and held an auction to offer the Hawaiian Aircraft for sale. As a result of the limited market and significant competition with respect to the Hawaiian Aircraft, the Hawaiian Lender was unsuccessful in its attempts to liquidate its security interest through a foreclosure sale. In August 1995, the Partnership removed the net carrying value of the Hawaiian Aircraft of approximately $2,292,000 (which included an allowance for equipment impairment of $2,493,000 previously provided) and the related nonrecourse notes and accrued interest payable of approximately $2,991,000, from its respective accounts. Both the Partnership and the Hawaiian Lender filed proofs of claim in the Hawaiian bankruptcy case. Because the Partnership's claims duplicated those of the Hawaiian Lender (since the Hawaiian Leases and all amounts thereunder were assigned to the Hawaiian Lender as collateral for the Hawaiian Loans), the Partnership withdrew its claims and the Hawaiian Lender assumed the responsibility of pursuing its own claims against Hawaiian. 10 COMMITMENTS AND CONTINGENCIES In January 1998, The Partnership received proposed notices of assessment from the City of New York, Department of Finance with respect to Unincorporated Business Tax ("UBT") of approximately $130,000 for the years 1992, 1993 and 1994. The City of New York is alleging that UBT is owed by the Partnership with respect to conducting business in New York City. Final assessments have not yet been issued. The Partnership intends to vigorously contest the assessment. Although there can be no assurance that the Partnership will be successful in its contest of the assessment, the Partnership believes the assessment is without merit. The Partnership has not recorded any provision or liability as a result of the proposed notices of assessment.
AMERICAN LEASING INVESTORS VIII-B, L.P. SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Additions ---------------------- Balance at Charged to Charged to Balance at Beginning Costs and Other Additions End Description of Period Expenses Accounts (Deductions) of Period ----------- --------- -------- -------- ------------ --------- YEAR ENDED DECEMBER 31, 1997 Equipment held for sale, valuation allowance for equipment impairment Transportation equipment $ - $ - $ - $ - $ - Allowance for uncollectible accounts - accounts receivable - - - - - ---------- -------- -------- ----------- -------- $ - $ - $ - $ - $ - ========== ========= ========= =========== ========= YEAR ENDED DECEMBER 31, 1996 Equipment held for sale, valuation allowance for equipment impairment Transportation equipment $ - $ - $ - $ - $ - Allowance for uncollectible accounts - accounts receivable - - - - - ---------- --------- --------- ----------- --------- $ - $ - $ - $ - $ - ========== ========= ========= =========== ========= YEAR ENDED DECEMBER 31, 1995 Equipment held for sale, valuation allowance for equipment impairment Transportation equipment $2,493,000 $ - $ - $(2,493,000) (A) $ - Allowance for uncollectible accounts - accounts receivable 866,584 - - (866,584) (B) - -------- --------- --------- ---------- --------- $3,359,584 $ - $ - $(3,359,584) $ - =========== ========= ========= =========== =========
(A) Represents valuation allowance for equipment impairment relating to certain transportation equipment disposed of during 1995. (B) Represents allowance for uncollectible accounts relating to assets which were disposed of during 1995. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. PART III Item 10. Directors and Executive Officers of Registrant Registrant has no officers or directors. The Managing General Partner manages and controls substantially all of Registrant's affairs and has general responsibility and ultimate authority in all matters affecting its business. The officers and directors of the Corporate General Partner and the Associate General Partner, in their respective capacities as such, do not devote any material amount of their business time and attention to Registrant's affairs. The names and positions held by the officers and directors of the Managing General Partner are described below. The officers and directors of the Corporate General Partner are the same as the officers and directors of the Managing General Partner.
Has served as a Director and/or Officer of the Managing Partner Name Age Position Held since ---- --- ------------- ----- W. Edward Scheetz 33 Director November 1997 David Hamamoto 38 Director November 1997 Richard Sabella 42 President, Director November 1997 David King 35 Executive VP, Director, Assistant November 1997 Treasurer Lawrence R. Schachter 41 Senior VP, Chief Financial Officer January 1998 Kevin Reardon 39 VP, Secretary, Treasurer, Director November 1997 Allan B. Rothschild 36 Executive VP December 1997 Marc Gordon 33 VP November 1997 Charles Humber 24 VP November 1997 Adam Anhang 24 VP November 1997 Gregory Peck 23 Assistant Secretary November 1997
Each director and officer of the Managing General Partner and of the Corporate General Partner will hold office until his successor is elected and qualified. The Managing General Partner also acts as the managing general partner of National Lease Income Fund 6 L.P. The foregoing partnership is or was in the past engaged in the acquisition, leasing and disposition of equipment. There are no family relationships between or among any of the directors and/or executive officers of the Managing General Partner. W. Edward Scheetz co-founded NorthStar Capital Partners with David Hamamoto in July 1997, having previously been a partner at Apollo Real Estate Advisors L.P. since 1993. From 1988 to 1993, Mr. Scheetz was a principal with Trammell Crow Ventures. David Hamamoto co-founded NorthStar Capital Partners with W. Edward Scheetz in July 1997, having previously been a partner and a co-head of the Real Estate Principal Investment Area at Goldman, Sachs & Co., where he initiated the effort to build a real estate principal investment business in 1988 under the auspices of the Whitehall Funds. Richard Sabella joined NorthStar Capital Partners in November 1997, having previously been the head of real estate and a partner at the law firm of Cahill, Gordon & Reindel since 1989. Mr. Sabella has also been associated with the law firms of Milgrim, Thomajian, Jacobs & Lee, P.C. and Cravath, Swaine & Moore. David King joined NorthStar Capital Partners in November 1997, having previously been a Senior Vice President of Finance at Olympia & York Companies (USA). Prior to joining Olympia & York in 1990, Mr. King worked for Bankers Trust in its real estate finance group. Lawrence R. Schachter joined NorthStar Presidio in January 1998, having previously held the position as Controller at CB Commercial/Hampshire, LLC from 1996 to 1997. Prior to joining CB, Mr. Schachter held the position of Controller at Goodrich Associates in 1996 and at Greenthal/Harlan Realty Services Co. from 1992 to 1995. Mr. Schachter, who holds a CPA, graduated from Miami University (Ohio). Kevin Reardon joined NorthStar Capital Partners in October 1997, having previously held the position of Controller at Lazard Freres Real Estate Investors from 1996 to 1997. Prior to joining Lazard Freres, Mr. Reardon was the Director of Finance in charge of European expansion at the law firm of Dewey Ballantine from 1993 to 1996. Prior to 1993, Mr. Reardon held a financial position at Hearst - ABC - Viacom Entertainment Services. Mr. Reardon, who holds a CPA, graduated from Fordham University with a B.S. in Accounting. Allan B. Rothschild joined NorthStar Presidio in December 1997, having previously been the Senior Vice President and General Counsel of Newkirk Limited Partnership where he managed a large portfolio of net-leased real estate assets. Prior to joining Newkirk in September 1995, Mr. Rothschild was associated with the law firm of Proskauer, Rose LLP in its real estate group. Marc Gordon joined NorthStar Capital Partners in October 1997, having previously been a Vice President in the Real Estate Investment Banking Group at Merrill Lynch where he executed corporate finance and strategic transactions for public and private real estate ownership companies, including REITs, real estate service companies, and real estate intensive operating companies. Prior to joining Merrill Lynch in 1993, Mr. Gordon was in the Real Estate and Banking Group at the law firm of Irell & Manella. Mr. Gordon graduated from Dartmouth College with an A.B. in economics and also holds a J.D. from the UCLA School of Law. Charles Humber joined NorthStar Capital Partners in September 1997, having previously worked for Merrill Lynch's Real Estate Investment Banking Group from 1996 to 1997. Mr. Humber graduated from Brown University with a B.A. in international relations and organizational behavior and management which is where he was prior to 1996. Adam Anhang joined NorthStar Capital Partners in August 1997, having previously worked for The Athena Group's Russia and Former Soviet Union development team from 1996 to 1997. Mr. Anhang graduated from the Wharton School of the University of Pennsylvania with a B.S. in economics with concentrations in finance and real estate, which is where he was prior to 1996. Gregory Peck joined NorthStar Capital Partners in July 1997, having previously worked for the Morgan Stanley Realty Real Estate Funds (MSREF) and Morgan Stanley's Real Estate Investment Banking Group from 1996 to 1997. Prior to joining Morgan Stanley, Mr. Peck worked for Lazard Freres & Co. LLC in the Real Estate Investment Banking Group from 1994 to 1996. Mr. Peck graduated from Columbia College with an A.B. in mathematics and an A.B. in economics. Messrs. Scheetz, Hamamoto, Sabella, King and Reardon also serve as directors of the general partners of the following limited partnerships whose limited partnership units are registered under Section 12 of the Exchange Act: Aircraft Income Partners, L.P., Resources Pension Shares 5, L.P., Vista Properties, Resources Accrued Mortgage Investors 2, L.P., Resources Accrual Mortgage Investors Series 86, L.P., Integrated Resources High Equity Partners - Series 85, High Equity Partners, L.P. - Series 86 and High Equity Partners, L.P. - Series 88. Presidio Boram Corp., the Associate General Partner, is a Wholly-owned subsidiary of Presidio whose directors are Messrs. Scheetz, Hamamoto, Sabella, King and Reardon. Registrant believes, based on written representations received by it, that for 1997 all filing requirements under Section 16(a) of the Securities Exchange Act of 1934 applicable to beneficial owners of Registrant's securities, Registrant's general partners and the officers and directors of such general partners, were complied with. Item 11. Executive Compensation Registrant is not required to pay the officers or directors of the General Partners any remuneration. The Managing General Partner does not presently pay any remuneration to any of its officers or directors. See Item 13, "Certain Relationships and Related Transactions." In addition, certain officers and directors of the Managing General Partner receive compensation from affiliates of the Managing General Partner (but not from Registrant) for services performed for various affiliated entities, which may include services performed for Registrant; however, the Managing General Partner believes that any compensation attributable to services performed for Registrant is immaterial. See Item 13, "Certain Relationships and Related Transactions." Item 12. Security Ownership of Certain Beneficial Owners and Management As of March 1, 1998, no person owned of record or was known by Registrant to own beneficially more than 5% of the Units of Registrant. As of March 1, 1998, neither the General Partners nor their officers and directors were known by Registrant to beneficially own Units or shares of Presidio, the parent of the General Partners. To the knowledge of the Registrant, the following sets forth certain information regarding ownership of the Class A shares of Presidio as of March 11, 1998 (except as otherwise noted) by (i) each person or entity who owns of record or beneficially five percent or more of the Class A shares, (ii) each director and executive officer of Presidio, and (iii) all directors and executive officers of Presidio as a group. To the knowledge of Presidio, each of such shareholders has sole voting and investment power as to the shares shown unless otherwise noted. All outstanding shares of Presidio are owned by Presidio Capital Investment Company, LLC ("PCIC"), a Delaware limited liability company. The interests in PCIC (and beneficial ownership in Presidio) are held as follows:
Percentage Ownership in PCIC and Percentage Beneficial Ownership Name of Beneficial Owner in Presidio ------------------------ ----------------------- Five Percent Holders: Presidio Holding Company, LLC(1) 71.93% AG Presidio Investors, LLC(2) 14.12% DK Presidio Investors, LLC(3) 8.45% Stonehill Partners, L.P.(4) 5.50%
The holdings of the directors and executive officers of Presidio are as follows:
Directors and Officers: Adam Anhang(5) 0% Marc Gordon(5) 0% David Hamamoto(5) 71.93% Charles Humber(5) 0% David King(5) 0% Gregory Peck(5) 0% Kevin Reardon(5) 0% Allan Rothschild(5) 0% Richard J. Sabella(5) 0% Lawrence Schachter(5) 0% W. Edward Scheetz(5) 71.93% Directors and Officers as a group: 71.93%
(1) Presidio Holding Company, LLC is a New York limited liability company whose address is 527 Madison Avenue, 16th Floor, New York, New York 10022. PHC has two members, Polaris Operating LLC ("Polaris") which holds a 1% interest, and Northstar Operating, LLC ("Northstar") which holds a 99% interest. Polaris is a Delaware limited liability company whose address is 527 Madison Avenue, 16th Floor, New York, New York 10022. Polaris has two members, Sextant Operating Corp. ("Sextant"), which holds a 1% interest, and Northstar, which holds a 99% interest. Sextant is a Delaware corporation whose address is 527 Madison Avenue, 16th Floor, New York, New York 10022 and whose sole shareholder is Northstar. Northstar is a Delaware limited liability company whose address is 527 Madison Avenue, 16th Floor, New York, New York 10022. Northstar has two members, Northstar Capital Partners ("NCP"), which holds a 99% interest, and Northstar Capital Holdings I, LLC ("NCHI"), which holds a 1% interest. Both NCP and NCHI are Delaware limited liability companies, whose business address is 527 Madison Avenue, 16th Floor, New York, New York 10022. NCP has two members, NCHI, which holds a 74.75% interest, and Northstar Capital Holdings II LLC ("NCHII"), which holds a 25.25% interest. The business address for NCHII, a Delaware limited liability company is 527 Madison Avenue, 16th Floor, New York, New York 10022. NCHII has three members, NCHI, which holds a 99% interest, Edward Scheetz, who holds a 0.5% interest and David Hamamoto, who holds a 0.5% interest. Mr. Scheetz, a U.S. citizen whose business address is 527 Madison Avenue, 16th Floor, New York, New York 10022, is a founding member of NCP. Mr. Hamamoto, a U.S. citizen whose business address is 527 Madison Avenue, 16th Floor, New York, New York 10022, is a founding member of NCP. NCHI has two members, Mr. Scheetz and Mr. Hamamoto, each of whom holds a 50% interest. Pursuant to that certain Amended and Restated Pledge and Security Agreement (the "Pledge Agreement") dated March 5, 1998 made by PHC in favor of Credit Suisse First Boston Mortgage Capital LLC ("CSFB"), PHC pledged all of its membership interest in PCIC to CSFB as security for loans issued under the Loan Agreement dated as of February 20, 1998 by and among PHC and CSFB and the First Amendment thereon dated March 5, 1998 (together, the "Loan Agreement"). The Pledge Agreement and Loan Agreement contain standard default and event of default provisions which may at a subsequent date result in a change of control of PCIC and, therefore, the Registrant. (2) Each of Angelo, Gordon & Co., L.P., as sole manager of AG Presidio Investors, LLC, and John M. Angelo and Michael L. Gordon, as general partners of the general partner of Angelo, Gordon & Co., L.P. may be deemed to beneficially own for purposes of Rule 13d-3 of the Exchange Act the securities beneficially owned by AG Presidio Investors, LLC. Each of John M. Angelo and Michael L. Gordon disclaim such beneficial ownership. The business address for such persons is c/o Angelo, Gordon & Co, L.P., 345 Park Avenue, 26th Floor, New York, New York 10167. (3) M.H. Davidson & Company, Inc., as sole manager of DK Presidio Investors, LLC may be deemed to beneficially own for purposes of Rule 13d-3 of the Exchange Act, the securities beneficially owned by DK Presidio Investors, LLC. The business address for such person is c/o M.H. Davidson & Company, 885 Third Avenue, New York, New York 10022. (4) Includes shares of PCIC beneficially owned by Stonehill Offshore Partners Limited and Stonehill Institutional Partners, L.P. John A. Motulsky is a managing general partner of Stonehill Partners, L.P., a managing member of the investment advisor to Stonehill Offshore Partners Limited and is a general partner of Stonehill Institutional Partners, L.P. John A. Motulsky disclaims beneficial ownership of the shares held by these entities. The business address for such person is c/o Stonehill Investment Corporation, 110 East 59th Street, New York, New York 10022. (5) The business address for such person is 527 Madison Avenue, 16th Floor, New York, New York 10022. Item 13. Certain Relationships and Related Transactions The following sums were paid to affiliates by Registrant for services rendered to Registrant during 1997:
Name of Recipient Capacity in Which Served Compensation - ----------------- ------------------------ ------------ ALI Equipment Management Corp. Managing General Partner $ 41,628 (1) Presidio Boram Corp. Associate General Partner $ 5,203 (2) ALI Capital Corp. Corporate General Partner $ 5,203 (3) IREG Affiliated Equipment Broker, Equipment Manager and Partnership Manager $ - (4)
(1) This amount represents distributions of distributable cash from sales and operations paid to the Managing General Partner for 1997. Pursuant to the Limited Partnership Agreement, 1% of the income or loss of Registrant is allocated to the General Partners (1/10 of 1% to the Associate General Partner, 1/10 of 1% to the Corporate General Partner and 8/10 of 1% to the Managing General Partner). Pursuant thereto, for 1997, $41,816 of Registrant's taxable income was allocated to the Managing General Partner. (2) These amounts represent distributions of distributable cash from sales and operations paid to the Associate General Partner for 1997. Additionally, pursuant to the Limited Partnership Agreement described in footnote (1) above, for 1997, $5,211 of Registrant's taxable income was allocated to the Associate General Partner. (3) This amount represents distributions of distributable cash from sales paid to the Corporate General Partner for 1997. Additionally, pursuant to the Limited Partnership Agreement described in footnote (1) above, for 1997, $5,211 of Registrant's taxable income was allocated to the Corporate General Partner. (4) IREG provides equipment management services to Registrant pursuant to the Management Agreement, for a fee based upon a percentage of Registrant's gross revenues from the equipment in its portfolio. Such Equipment Management Fees aggregated $0 for 1997. Pursuant to the Management Agreement referred to above, IREG is also entitled to receive partnership management fees of 4% of the cash from operations. The Registrant did not incur any such fees for 1997. Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," for a discussion of the possible impact of declining equipment management fees on IREG and Registrant. PART IV Item 14. Exhibits, Financial Statement Schedule, and Reports on Form 8-K (a)1. Financial Statements (see Index to Financial Statements and Supplemental Data in Item 8). (a)2. Financial Statement Schedule II -- Valuation and Qualifying Accounts (see Index to Financial Statements and Supplemental Data in Item 8). (a)3. Exhibits 3, 4 Agreement of Limited Partnership of Registrant is incorporated by reference to Exhibit A to the Prospectus of Registrant dated March 26, 1986 (File No. 33-1511), filed pursuant to Rule 424 of the Securities Act of 1933, as amended. 3(b) Amendment to Certificate of Limited Partnership. 10(a) Management Agreement between Registrant and ALI Leasing Service Corp. incorporated by reference to Exhibit 10(b) to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(b) Acquisition and Disposition Services Agreement between Registrant and ALI Leasing Service Corp. incorporated by reference to Exhibit 10(c) to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(c) Agreement entered into among CDG Associates, ALI Equipment Management Corp. and Integrated Resources, Inc., incorporated by reference to Exhibit 10(d) to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(d) Bill of Sale dated as of December 16, 1985 between National Lease Income Fund 3, as Seller, and American Leasing Investors VIII-B, L.P., as Purchaser, incorporated by reference to Exhibit 10(g) to Amendment No. 1 to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(e) Lease Schedule dated as of December 16, 1985 between American Leasing Investors VIII-B, L.P., as Owner, and Clark O'Neill, Inc., as Lessee, incorporated by reference to Exhibit 10(h) to Amendment No. 1 to Registration Statement on Form S-1 under the Securities Act of 1933, File No. 33-1511. 10(f) Master Lease dated as of October 1, 1983 between National Lease Income Fund 2, as Lessor, and Clark O'Neill, Inc., as Lessee, incorporated by reference to Exhibit 10(i) to Amendment No. 1 to Registration Statement on Form S-1 under the Securities Act of 1933, File No. 33-1511. 10(g) Aircraft Lease (N60RA) dated as of December 16, 1986 between First Security Bank of Utah, N.A. (as trustee), as Lessor, and Hawaiian Airlines, Inc., as Lessee, regarding one (1) de Havilland DHC Dash 7 Series 102 Aircraft (serial no. 78), incorporated by reference to Exhibit 10(j) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(h) Assignment of Purchase Agreement dated as of December 16, 1986 between Hawaiian Airlines, Inc. (the Assignor) and First Security Bank of Utah, N.A. (the Assignee), incorporated by reference to Exhibit 10(k) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(i) Aircraft Lease (N890S) dated as of December 17, 1986 between First Security Bank of Utah, N.A. (as trustee), as Lessor, and Hawaiian Airlines, Inc., as Lessee, regarding One (1) de Havilland DHC Dash 7 Series 102 Aircraft (serial no. 13), incorporated by reference to Exhibit 10(l) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(j) Bill of Sale dated as of December 17, 1986 between Hawaiian Airlines, Inc., as Seller, and First Security Bank of Utah, N.A., as Purchaser, incorporated by reference to Exhibit 10(m) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(k) Purchase Agreement dated as of July 25, 1986 between Northern Telecom Inc., as Seller, and Champion International Corporation, as Purchaser, regarding two (2) telecommunications systems, incorporated by reference to Exhibit 10(n) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(l) Assignment of Purchase Agreement dated as of October 31, 1986 between Champion International Corporation, as Assignor, and American Leasing Investors VIII-B, L.P., as Assignee, incorporated by reference to Exhibit 10(o) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(m) Master Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Champion International Corporation, as Lessee, incorporated by reference to Exhibit 10(p) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(n) Loan and Security Agreement dated as of October 31, 1986 between Chase Lincoln Lease/Way, Inc., as Lender, and American Leasing Investors VIII-B, L.P., as Borrower, incorporated by reference to Exhibit 10(q) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(o) Collateral Assignment of Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Chase Lincoln Lease/Way, Inc., as Assignee, incorporated by reference to Exhibit 10(r) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(p) Limited Recourse Note dated as of December 30, 1986 between American Leasing Investors VIII-B, L.P., as Maker, and Chase Lincoln Lease/Way, Inc., as Lender, incorporated by reference to Exhibit 10(s) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-1580l. 10(q) Bill of Sale dated December 31, 1986 between Northern Telecom Inc., as Vendor, and American Leasing Investors VIII-B, L.P., as Customer, incorporated by reference to Exhibit 10(t) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(r) Lease Agreement dated as of September 1, 1986 between Integrated Equipment Holding Corp., as Lessor, and E.I. DuPont de Nemours and Company, as Lessee, incorporated by reference to Exhibit 10(u) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(s) Secured Promissory Note dated September 12, 1986 between Integrated Equipment Holding Corp., as Maker, and Nationwide Life Insurance Company, as the Secured Party, incorporated by reference to Exhibit 10(v) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(t) Assignment of Leasing Agreement dated as of September 1, 1986 between Integrated Equipment Holding Corp., as Assignor, and Nationwide Life Insurance Company, as Assignee, and Consent To Assignment of Leasing Agreement dated as of September 1, 1986 between E.I. DuPont de Nemours and Company, as Lessee, and Assignor and Assignee listed above, incorporated by reference to Exhibit 10(w) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(u) Sales Contract dated August 19, 1986 between British Aerospace, Inc., as Seller, and Integrated Equipment Holding Corp., as Buyer, incorporated by reference to Exhibit 10(x) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(v) Aircraft Modification Agreement dated August 19, 1986 between Arkansas Modification Center, Inc., as Contractor, and Integrated Equipment Holding Corp., as Owner, incorporated by reference to Exhibit 10(y) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(w) Aircraft Bill of Sale dated September 12, 1986 between Integrated Equipment Holding Corp., as Purchaser, and British Aerospace, Inc., as Seller, incorporated by reference to Exhibit 10(z) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(x) Bill of Sale dated as of October 10, 1986 between Integrated Equipment Holding Corp., as Seller, and First Security Bank of Utah, N.A., as Buyer, incorporated by reference to Exhibit 10(aa) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(y) Trailer Lease Agreement dated as of January 1, 1987 between American Leasing Investors VIII-B, L.P., as Lessor, and Marx Truck Trailer Sales, Inc., as Lessee, incorporated by reference to Exhibit 10(bb) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1987, File No. 0-15801. 10(z) Amendment A to Equipment Schedule No. 1 dated as of December 16, 1991 under Master Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Champion International Corporation, as Lessee, is incorporated by reference to Exhibit 10(z) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1991, File No. 0-15801. 10(aa) Amendment A to Equipment Schedule No. 2 dated as of December 16, 1991 under Master Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Champion International Corporation, as Lessee, is incorporated by reference to Exhibit 10(aa) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1991, File No. 0-15801. 10(bb) Lease Amendment Number Three, dated July 1, 1992, to Lease dated December 16, 1986 between Hawaiian Airlines, Inc., as Lessee, and First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 16, 1986, as Lessor, as amended and supplemented by Lease Supplement No. 1 dated December 31, 1986, Amendment Number One dated January 1, 1987, and Lease Amendment Number Two dated February 1, 1988, is incorporated by reference to Exhibit 10(bb) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(cc) Amendment Number Two to Mortgage and Loan Agreement dated as of July 1, 1992 between First Security Bank of Utah, N. A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 16, 1986, as Borrower, and Federal Deposit Insurance Corporation, as receiver for Goldome, successor to Goldome FSB, as Lender, dated November 12, 1992, and accompanying Promissory Note in the principal amount of $1,763,822.58, is incorporated by reference to Exhibit 10(cc) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(dd) Lease Amendment Number Three, dated as of July 1, 1992, to Lease dated December 17, 1986 between Hawaiian Airlines, Inc., as Lessee, and First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 17, 1986, as Lessor, as amended and supplemented by Lease Supplement No. 1 dated December 31, 1986, Amendment Number One dated January 1, 1987, and Lease Amendment Number Two dated February 1, 1988, is incorporated by reference to Exhibit 10(dd) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(ee) Amendment Number Two to Mortgage and Loan Agreement dated as of July 1, 1992 between First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 17, 1986, as Borrower, and Federal Deposit Insurance Corporation, as receiver for Goldome, successor to Goldome FSB, as Lender, dated November 12, 1992, and accompanying Promissory Note in the principal amount of $1,671,209.34, is incorporated by reference to Exhibit 10(ee) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(ff) Lease Supplement No. 3, dated October 22, 1992, to Lease Agreement between Integrated Equipment Holding Corp. ("Integrated"), as Lessor, and E.I. DuPont de Nemours and Company, as Lessee, dated September 1, 1986, as supplemented by Unit Record of Lease dated September 12, 1986, as assigned by Integrated under the Purchase, Assignment and Assumption Agreement dated as of October 10, 1986 to First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under a Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated October 10, 1986, as amended by Lease Supplement Nos. 1 and 2, dated January 22, 1987 and December 20, 1989, respectively, is incorporated by reference to Exhibit 10(ff) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(gg) First Amendment to Loan and Security Agreement, dated as of October 22, 1992, between First Security Bank of Utah, N.A., not in its individual capacity, but solely as Trustee under a Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of October 10,1986, between American Leasing Investors VIII-B, L.P., as Trustee, and Nationwide Life Insurance Company and accompanying Secured Promissory Note in the amount of $344,987.84, is incorporated by reference to Exhibit 10(gg) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(hh) Notice from Marx Truck Trailer Sales to IREG, dated February 26, 1993, regarding direct sale of (19) 1987 Trailmobile Trailers to Action Carrier for $14,000 per trailer is incorporated by reference to Exhibit 10(hh) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801, is incorporated by reference to Exhibit 10(hh) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(ii) Bill of Sale, dated March 16, 1993 of American Leasing Investors VIII-B, L.P. (Seller) to Action Carrier, Inc. (Purchaser) regarding (19) 1987 Trailmobile Refrigerated Van Trailers, Model IANIUAL, is incorporated by reference to Exhibit 10(ii) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(jj) Amendment No. 1 to Equipment Lease No. 6, dated as of October 18, 1995, between American Leasing Investors VIII-B, L.P., as lessor and Xerox Corporation, as lessee is incorporated by reference to Exhibit 10(jj) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1995, File No. 0-15801. (b) Current Reports on Form 8-K filed during the last quarter of Registrant's fiscal year: None. SIGNATURES Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on the 14th day of April 1998. AMERICAN LEASING INVESTORS VIII-B, L.P. By: ALI EQUIPMENT MANAGEMENT CORP. Managing General Partner Date ---- By: /s/ Richard Sabella April 14, 1998 ------------------- Richard Sabella President Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Registrant in their capacities as directors and/or officers (as to the Managing General Partner) on the date indicated below. Signature Title Date --------- ----- ---- /s/ Lawrence Schachter Senior Vice President and April 14, 1998 - ----------------------- Chief Financial Officer Lawrence Schachter /s/ Richard Sabella Director and President April 14, 1998 - ------------------- Richard Sabella /s/ David King Director and Executive April 14, 1998 - -------------- Vice President David King /s/ Kevin Reardon Director and Vice President, April 14, 1998 - ----------------- Treasurer and Secretary Kevin Reardon EXHIBIT INDEX Exhibits 3, 4 Agreement of Limited Partnership of Registrant is incorporated by reference to Exhibit A to the Prospectus of Registrant dated March 26, 1986 (File No. 33-1511), filed pursuant to Rule 424 of the Securities Act of 1933, as amended. 3(b) Amendment to Certificate of Limited Partnership. 10(a) Management Agreement between Registrant and ALI Leasing Service Corp. incorporated by reference to Exhibit 10(b) to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(b) Acquisition and Disposition Services Agreement between Registrant and ALI Leasing Service Corp. incorporated by reference to Exhibit 10(c) to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(c) Agreement entered into among CDG Associates, ALI Equipment Management Corp. and Integrated Resources, Inc., incorporated by reference to Exhibit 10(d) to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(d) Bill of Sale dated as of December 16, 1985 between National Lease Income Fund 3, as Seller, and American Leasing Investors VIII-B, L.P., as Purchaser, incorporated by reference to Exhibit 10(g) to Amendment No. 1 to Form S-1 Registration Statement under the Securities Act of 1933, File No. 33-1511. 10(e) Lease Schedule dated as of December 16, 1985 between American Leasing Investors VIII-B, L.P., as Owner, and Clark O'Neill, Inc., as Lessee, incorporated by reference to Exhibit 10(h) to Amendment No. 1 to Registration Statement on Form S-1 under the Securities Act of 1933, File No. 33-1511. 10(f) Master Lease dated as of October 1, 1983 between National Lease Income Fund 2, as Lessor, and Clark O'Neill, Inc., as Lessee, incorporated by reference to Exhibit 10(i) to Amendment No. 1 to Registration Statement on Form S-1 under the Securities Act of 1933, File No. 33-1511. 10(g) Aircraft Lease (N60RA) dated as of December 16, 1986 between First Security Bank of Utah, N.A. (as trustee), as Lessor, and Hawaiian Airlines, Inc., as Lessee, regarding one (1) de Havilland DHC Dash 7 Series 102 Aircraft (serial no. 78), incorporated by reference to Exhibit 10(j) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(h) Assignment of Purchase Agreement dated as of December 16, 1986 between Hawaiian Airlines, Inc. (the Assignor) and First Security Bank of Utah, N.A. (the Assignee), incorporated by reference to Exhibit 10(k) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(i) Aircraft Lease (N890S) dated as of December 17, 1986 between First Security Bank of Utah, N.A. (as trustee), as Lessor, and Hawaiian Airlines, Inc., as Lessee, regarding One (1) de Havilland DHC Dash 7 Series 102 Aircraft (serial no. 13), incorporated by reference to Exhibit 10(l) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(j) Bill of Sale dated as of December 17, 1986 between Hawaiian Airlines, Inc., as Seller, and First Security Bank of Utah, N.A., as Purchaser, incorporated by reference to Exhibit 10(m) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(k) Purchase Agreement dated as of July 25, 1986 between Northern Telecom Inc., as Seller, and Champion International Corporation, as Purchaser, regarding two (2) telecommunications systems, incorporated by reference to Exhibit 10(n) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(l) Assignment of Purchase Agreement dated as of October 31, 1986 between Champion International Corporation, as Assignor, and American Leasing Investors VIII-B, L.P., as Assignee, incorporated by reference to Exhibit 10(o) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(m) Master Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Champion International Corporation, as Lessee, incorporated by reference to Exhibit 10(p) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(n) Loan and Security Agreement dated as of October 31, 1986 between Chase Lincoln Lease/Way, Inc., as Lender, and American Leasing Investors VIII-B, L.P., as Borrower, incorporated by reference to Exhibit 10(q) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(o) Collateral Assignment of Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Chase Lincoln Lease/Way, Inc., as Assignee, incorporated by reference to Exhibit 10(r) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(p) Limited Recourse Note dated as of December 30, 1986 between American Leasing Investors VIII-B, L.P., as Maker, and Chase Lincoln Lease/Way, Inc., as Lender, incorporated by reference to Exhibit 10(s) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-1580l. 10(q) Bill of Sale dated December 31, 1986 between Northern Telecom Inc., as Vendor, and American Leasing Investors VIII-B, L.P., as Customer, incorporated by reference to Exhibit 10(t) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(r) Lease Agreement dated as of September 1, 1986 between Integrated Equipment Holding Corp., as Lessor, and E.I. DuPont de Nemours and Company, as Lessee, incorporated by reference to Exhibit 10(u) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(s) Secured Promissory Note dated September 12, 1986 between Integrated Equipment Holding Corp., as Maker, and Nationwide Life Insurance Company, as the Secured Party, incorporated by reference to Exhibit 10(v) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(t) Assignment of Leasing Agreement dated as of September 1, 1986 between Integrated Equipment Holding Corp., as Assignor, and Nationwide Life Insurance Company, as Assignee, and Consent To Assignment of Leasing Agreement dated as of September 1, 1986 between E.I. DuPont de Nemours and Company, as Lessee, and Assignor and Assignee listed above, incorporated by reference to Exhibit 10(w) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(u) Sales Contract dated August 19, 1986 between British Aerospace, Inc., as Seller, and Integrated Equipment Holding Corp., as Buyer, incorporated by reference to Exhibit 10(x) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(v) Aircraft Modification Agreement dated August 19, 1986 between Arkansas Modification Center, Inc., as Contractor, and Integrated Equipment Holding Corp., as Owner, incorporated by reference to Exhibit 10(y) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(w) Aircraft Bill of Sale dated September 12, 1986 between Integrated Equipment Holding Corp., as Purchaser, and British Aerospace, Inc., as Seller, incorporated by reference to Exhibit 10(z) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(x) Bill of Sale dated as of October 10, 1986 between Integrated Equipment Holding Corp., as Seller, and First Security Bank of Utah, N.A., as Buyer, incorporated by reference to Exhibit 10(aa) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1986, File No. 0-15801. 10(y) Trailer Lease Agreement dated as of January 1, 1987 between American Leasing Investors VIII-B, L.P., as Lessor, and Marx Truck Trailer Sales, Inc., as Lessee, incorporated by reference to Exhibit 10(bb) to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1987, File No. 0-15801. 10(z) Amendment A to Equipment Schedule No. 1 dated as of December 16, 1991 under Master Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Champion International Corporation, as Lessee, is incorporated by reference to Exhibit 10(z) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1991, File No. 0-15801. 10(aa) Amendment A to Equipment Schedule No. 2 dated as of December 16, 1991 under Master Lease dated as of October 31, 1986 between American Leasing Investors VIII-B, L.P., as Lessor, and Champion International Corporation, as Lessee, is incorporated by reference to Exhibit 10(aa) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1991, File No. 0-15801. 10(bb) Lease Amendment Number Three, dated July 1, 1992, to Lease dated December 16, 1986 between Hawaiian Airlines, Inc., as Lessee, and First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 16, 1986, as Lessor, as amended and supplemented by Lease Supplement No. 1 dated December 31, 1986, Amendment Number One dated January 1, 1987, and Lease Amendment Number Two dated February 1, 1988, is incorporated by reference to Exhibit 10(bb) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(cc) Amendment Number Two to Mortgage and Loan Agreement dated as of July 1, 1992 between First Security Bank of Utah, N. A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 16, 1986, as Borrower, and Federal Deposit Insurance Corporation, as receiver for Goldome, successor to Goldome FSB, as Lender, dated November 12, 1992, and accompanying Promissory Note in the principal amount of $1,763,822.58, is incorporated by reference to Exhibit 10(cc) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(dd) Lease Amendment Number Three, dated as of July 1, 1992, to Lease dated December 17, 1986 between Hawaiian Airlines, Inc., as Lessee, and First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 17, 1986, as Lessor, as amended and supplemented by Lease Supplement No. 1 dated December 31, 1986, Amendment Number One dated January 1, 1987, and Lease Amendment Number Two dated February 1, 1988, is incorporated by reference to Exhibit 10(dd) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(ee) Amendment Number Two to Mortgage and Loan Agreement dated as of July 1, 1992 between First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under the Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of December 17, 1986, as Borrower, and Federal Deposit Insurance Corporation, as receiver for Goldome, successor to Goldome FSB, as Lender, dated November 12, 1992, and accompanying Promissory Note in the principal amount of $1,671,209.34, is incorporated by reference to Exhibit 10(ee) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(ff) Lease Supplement No. 3, dated October 22, 1992, to Lease Agreement between Integrated Equipment Holding Corp. ("Integrated"), as Lessor, and E.I. DuPont de Nemours and Company, as Lessee, dated September 1, 1986, as supplemented by Unit Record of Lease dated September 12, 1986, as assigned by Integrated under the Purchase, Assignment and Assumption Agreement dated as of October 10, 1986 to First Security Bank of Utah, N.A., not in its individual capacity, but solely as trustee under a Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated October 10, 1986, as amended by Lease Supplement Nos. 1 and 2, dated January 22, 1987 and December 20, 1989, respectively, is incorporated by reference to Exhibit 10(ff) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(gg) First Amendment to Loan and Security Agreement, dated as of October 22, 1992, between First Security Bank of Utah, N.A., not in its individual capacity, but solely as Trustee under a Trust Agreement for the benefit of American Leasing Investors VIII-B, L.P., dated as of October 10,1986, between American Leasing Investors VIII-B, L.P., as Trustee, and Nationwide Life Insurance Company and accompanying Secured Promissory Note in the amount of $344,987.84, is incorporated by reference to Exhibit 10(gg) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(hh) Notice from Marx Truck Trailer Sales to IREG, dated February 26, 1993, regarding direct sale of (19) 1987 Trailmobile Trailers to Action Carrier for $14,000 per trailer is incorporated by reference to Exhibit 10(hh) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801, is incorporated by reference to Exhibit 10(hh) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(ii) Bill of Sale, dated March 16, 1993 of American Leasing Investors VIII-B, L.P. (Seller) to Action Carrier, Inc. (Purchaser) regarding (19) 1987 Trailmobile Refrigerated Van Trailers, Model IANIUAL, is incorporated by reference to Exhibit 10(ii) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 0-15801. 10(jj) Amendment No. 1 to Equipment Lease No. 6, dated as of October 18, 1995, between American Leasing Investors VIII-B, L.P., as lessor and Xerox Corporation, as lessee Leasing Investors VIII-B, L.P., as lessor and Xerox Corporation, as lessee is incorporated by reference to Exhibit 10(jj) of Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1995, File No. 0-15801 EX-27 2
5 The schedule contains summary information extracted from the Financial statements of the December 31, 1997 Form 10-K of American Leasing Investors VIII-B, L.P. and is qualified in its entirety by reference to such financial statements. YEAR DEC-31-1997 DEC-31-1997 208,631 0 0 0 0 240,417 810,576 805,268 245,725 63,382 0 0 0 0 182,343 245,725 0 2,361,449 0 176,753 114,380 0 0 2,070,316 0 2,070,316 0 0 0 2,070,316 0 0
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