Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
|X| Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934.
For the quarterly period ended March 31, 2003
|_| Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934.
For the transition period from _______ to _______
Commission File Number 000-23842
ATEL Cash Distribution Fund V, L.P.
(Exact name of registrant as specified in its charter)
California 94-3165807
---------- ----------
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
600 California Street, 6th Floor, San Francisco, California 94108-2733
(Address of principal executive offices)
Registrant's telephone number, including area code: (415) 989-8800
Securities registered pursuant to section 12(b) of the Act: None
Securities registered pursuant to section 12(g) of the Act: Limited Partnership
Units
Indicate by a check mark whether the registrant (1) has filed all reports
required to be filed by section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes |X| No |_|
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes |_| No |X|
The number of Limited Partnership Units outstanding as of March 31, 2003 was
12,471,600
DOCUMENTS INCORPORATED BY REFERENCE
None
1
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited).
2
ATEL CASH DISTRIBUTION FUND V, L.P.
BALANCE SHEETS
MARCH 31, 2003 AND DECEMBER 31, 2002
(Unaudited)
ASSETS
2003 2002
---- ----
Cash and cash equivalents $ 2,082,370 $3,806,560
Accounts receivable, net of allowance for
doubtful accounts of $75,285 in 2003
and 2002 541,993 420,737
Investments in leases 14,458,933 15,647,718
------------------- -----------------
Total assets $ 17,083,296 $19,875,015
=================== =================
LIABILITIES AND PARTNERS' CAPITAL
Non-recourse debt $ 493,376 $ 667,460
Accounts payable:
General Partner 21,482 115,390
Other 183,358 195,877
Accrued interest expense 2,567 3,603
Unearned operating lease income 28,128 27,680
------------------- -----------------
Total liabilities 728,911 1,010,010
Partners' capital:
General Partner 196,551 202,907
Limited Partners 16,157,834 18,662,098
------------------- -----------------
Total partners' capital 16,354,385 18,865,005
------------------- -----------------
Total liabilities and partners' capital $ 17,083,296 $19,875,015
=================== =================
See accompanying notes.
3
ATEL CASH DISTRIBUTION FUND V, L.P.
STATEMENTS OF OPERATIONS
THREE MONTH PERIODS ENDED
MARCH 31, 2003 AND 2002
(Unaudited)
Revenues: 2003 2002
---- ----
Leasing activities:
Operating leases $ 595,244 $1,403,768
Direct financing leases 88,185 112,557
Leveraged leases 2,356 10,844
Gain on sales of assets 64,135 85,435
Interest income 6,943 1,318
Other 1,003 1,739
------------------- -----------------
757,866 1,615,661
Expenses:
Impairment losses 553,426 -
Depreciation and amortization 396,901 1,034,848
Railcar maintenance 156,255 68,764
Cost reimbursements to General Partner 147,440 188,248
Equipment and incentive management fees to General Partner 32,496 60,888
Professional fees 20,632 36,322
Interest expense 9,633 263,930
Other 76,699 60,718
------------------- -----------------
1,393,482 1,713,718
------------------- -----------------
Net loss $ (635,616) $ (98,057)
=================== =================
Net loss:
General Partner $ (6,356) $ (981)
Limited Partners (629,260) (97,076)
------------------- -----------------
$ (635,616) $ (98,057)
=================== =================
Net loss per Limited Partnership Unit $ (0.05) $ (0.01)
Weighted average number of Units outstanding 12,471,600 12,497,000
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
THREE MONTH PERIOD
ENDED MARCH 31, 2003
(Unaudited)
Limited Partners General
Units Amount Partner Total
Balance December 31, 2002 12,471,600 $18,662,098 $ 202,907 $18,865,005
Distributions to limited partners - (1,875,004) - (1,875,004)
Net loss - (629,260) (6,356) (635,616)
----------------- ----------------- ------------------- -----------------
Balance March 31, 2003 12,471,600 $16,157,834 $ 196,551 $16,354,385
================= ================= =================== =================
See accompanying notes.
4
ATEL CASH DISTRIBUTION FUND V, L.P.
STATEMENTS OF CASH FLOWS
THREE MONTH PERIODS ENDED
MARCH 31, 2003 AND 2002
(Unaudited)
Operating activities: 2003 2002
---- ----
Net loss $ (635,616) $ (98,057)
Adjustment to reconcile net loss to cash
provided by operating activities:
Impairment losses 553,426 -
Depreciation and amortization 396,901 1,034,848
Gain on sales of lease assets (64,135) (85,435)
Leveraged lease income (2,356) (10,844)
Changes in operating assets and liabilities:
Accounts receivable (121,256) 74,712
Accounts payable, General Partner (93,908) 52,366
Accounts payable, other (12,519) 248,917
Accrued interest expense (1,036) (3,480)
Unearned operating lease income 448 (58,493)
------------------- -----------------
Net cash provided by operations 19,949 1,154,534
------------------- -----------------
Investing activities:
Proceeds from sales of lease assets 150,549 391,850
Reduction of net investment in direct financing leases 108,032 436,935
Reduction of net investment in leveraged leases 46,368 21,688
------------------- -----------------
Net cash provided by investing activities 304,949 850,473
------------------- -----------------
Financing activities:
Distributions to Limited Partners (1,875,004) (1,088,393)
Repayments of non-recourse debt (174,084) (1,407,272)
Repayments of borrowings under line of credit - (1,000,000)
Proceeds of non-recourse debt - 759,436
Borrowings under line of credit - 500,000
------------------- -----------------
Net cash used in financing activities (2,049,088) (2,236,229)
------------------- -----------------
Net decrease in cash and cash equivalents (1,724,190) (231,222)
Cash and cash equivalents at beginning of period 3,806,560 443,772
------------------- -----------------
Cash and cash equivalents at end of period $ 2,082,370 $ 212,550
=================== =================
Supplemental disclosures of cash flow information:
Cash paid during the period for interest $ 10,669 $ 267,410
=================== =================
See accompanying notes.
5
ATEL CASH DISTRIBUTION FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2003
(Unaudited)
1. Summary of significant accounting policies:
Basis of presentation:
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with instructions to Form 10-Q and Article 10 of Regulation S-X. The
unaudited interim financial statements reflect all adjustments which are, in the
opinion of the General Partner, necessary to a fair statement of financial
position and results of operations for the interim periods presented. All such
adjustments are of a normal recurring nature. These unaudited interim financial
statements should be read in conjunction with the financial statements and notes
thereto contained in the report on Form 10-K for the year ended December 31,
2002, filed with the Securities and Exchange Commission.
2. Organization and partnership matters:
ATEL Cash Distribution Fund V, L.P. (the Partnership) was formed under the laws
of the state of California on September 23, 1992, for the purpose of acquiring
equipment to engage in equipment leasing and sales activities.
Upon the sale of the minimum amount of Units of Limited Partnership interest
(Units) of $1,200,000 and the receipt of the proceeds thereof on March 19, 1993,
the Partnership commenced operations.
The Partnership does not make a provision for income taxes since all income and
losses will be allocated to the Partners for inclusion in their individual tax
returns.
ATEL Financial Services, LLC, an affiliated entity, acts as the General Partner
of the Partnership.
3. Investment in leases:
The Partnership's investment in leases consists of the following:
Depreciation
Balance Expense and Balance
December 31, Impairment Amortization Reclassifications March 31,
2002 Losses of Leases & Dispositions 2003
---- ------ --------- -------------- ----
Net investment in operating
leases $13,484,449 $ (553,426) $ (387,992) $ (541,797) $12,001,234
Net investment in direct
financing lease 1,180,081 - (108,032) (69,998) 1,002,051
Net investment in leveraged
leases 140,012 - (44,012) - 96,000
Assets held for sale or lease 3,523,627 - - (2,187,307) 1,336,320
Reserve for losses (2,712,688) - - 2,712,688 -
Initial direct costs, net of
accumulated amortization of
$286,017 in 2003 and $544,354 in
2002 32,237 - (8,909) - 23,328
----------------- ----------------- ----------------- ------------------- -----------------
$15,647,718 $ (553,426) $ (548,945) $ (86,414) $14,458,933
================= ================= ================= =================== =================
6
ATEL CASH DISTRIBUTION FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2003
(Unaudited)
3. Investment in leases (continued):
Property subject to operating leases consists of the following:
Balance Balance
December 31, Impairment Depreciation Reclassifications March 31,
2002 Losses Expense & Dispositions 2003
---- ------ ------- -------------- ----
Transportation $20,593,171 $ - $ - $ 4,474,108 $25,067,279
Manufacturing 2,666,354 - - - 2,666,354
Construction 2,172,807 - - - 2,172,807
Materials handling 49,550 - - (49,550) -
----------------- ----------------- ----------------- ------------------- -----------------
25,481,882 - - 4,424,558 29,906,440
Less accumulated depreciation (11,997,433) (553,426) (387,992) (4,966,355) (17,905,206)
----------------- ----------------- ----------------- ------------------- -----------------
$13,484,449 $ (553,426) $ (387,992) $ (541,797) $12,001,234
================= ================= ================= =================== =================
All of the property on leases was acquired in 1993, 1994, 1995, 1996 and 1997.
At March 31, 2003, the aggregate amounts of future minimum lease payments are as
follows:
Direct
Operating Financing
Leases Leases Total
Nine months ending December 31, 2003 $1,139,879 $ 562,500 $ 1,702,379
Year ending December 31, 2004 660,036 750,000 1,410,036
2005 224,987 - 224,987
2006 14,122 - 14,122
----------------- ----------------- -------------------
$2,039,024 $1,312,500 $ 3,351,524
================= ================= ===================
Direct financing leases:
As of March 31, 2003, investment in direct financing leases consists of mining
equipment. The following lists the components of the Company's investment in
direct financing leases as of March 31, 2003:
Total minimum lease payments receivable $ 1,312,500
Estimated residual values of leased equipment (unguaranteed) 401
---------------
Investment in direct financing leases 1,312,901
Less unearned income (310,850)
---------------
Net investment in direct financing leases $ 1,002,051
===============
7
ATEL CASH DISTRIBUTION FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2003
(Unaudited)
4. Non-recourse debt:
Notes payable to financial institutions are due in varying monthly, quarterly
and semi-annual installments of principal and interest. The notes are secured by
assignments of lease payments and pledges of the assets which were purchased
with the proceeds of the particular notes. Interest rates on the notes vary from
6.5% to 10.5%.
Future minimum principal payments of non-recourse debt are as follows:
Principal Interest Total
Nine months ending December 31, 2003 $ 166,086 $ 20,603 $ 186,689
Year ending December 31, 2004 151,084 18,384 169,468
2005 162,167 7,301 169,468
2006 14,039 83 14,122
----------------- ----------------- -------------------
$ 493,376 $ 46,371 $ 539,747
================= ================= ===================
5. Related party transactions:
The terms of the Limited Partnership Agreement provide that the General Partner
and/or Affiliates are entitled to receive certain fees for equipment
acquisition, management and resale and for management of the Partnership.
The Limited Partnership Agreement allows for the reimbursement of costs incurred
by the General Partner in providing services to the Partnership. Services
provided include Partnership accounting, investor relations, legal counsel and
lease and equipment documentation. The General Partner is not reimbursed for
services where it is entitled to receive a separate fee as compensation for such
services, such as acquisition and management of equipment. Reimbursable costs
incurred by the General Partner are allocated to the Partnership based upon
actual time incurred by employees working on Partnership business and an
allocation of rent and other costs based on utilization studies.
Substantially all employees of the General Partner record time incurred in
performing services on behalf of all of the Partnerships serviced by the General
Partner. The General Partner believes that the costs reimbursed are the lower of
(i) actual costs incurred on behalf of the Partnership or (ii) the amount the
Partnership would be required to pay independent parties for comparable services
in the same geographic location and are reimbursable in accordance with the
Limited Partnership Agreement.
8
ATEL CASH DISTRIBUTION FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2003
(Unaudited)
5. Related party transactions (continued):
During the three months ended March 31, 2003 and 2002, the General Partner
and/or Affiliates earned fees, commissions and reimbursements, pursuant to the
Limited Partnership Agreement, as follows:
2003 2002
---- ----
Costs reimbursed to General Partner $ 147,440 $ 188,248
Incentive management fees (computed as 5% of distributions of cash from
operations, as defined in the Limited Partnership Agreement) and equipment
management fees (computed as 5% of gross revenues from operating leases, as
defined in the Limited Partnership Agreement plus 2% of gross revenues from full
payout leases, as defined in the Limited Partnership Agreement) 32,496 60,888
------------------- -----------------
$ 179,936 $ 249,136
=================== =================
6. Line of credit:
The Partnership participates with the General Partner and certain of its
affiliates in a $56,191,292 revolving line of credit (comprised of an
acquisition facility and a warehouse facility) with a financial institution that
includes certain financial covenants. The line of credit expires on June 28,
2004. As of March 31, 2003, borrowings under the facility were as follows:
Amount borrowed by the Partnership under the acquisition facility $ -
Amounts borrowed by affiliated partnerships and limited liability companies
under the acquisition facility 17,200,000
-----------------
Total borrowings under the acquisition facility 17,200,000
Amounts borrowed by the General Partner and its sister corporation under the
warehouse facility -
-----------------
Total outstanding balance $ 17,200,000
=================
Total available under the line of credit $ 56,191,292
Total outstanding balance (17,200,000)
-----------------
Remaining availability $ 38,991,292
=================
Draws on the acquisition facility by any individual borrower are secured only by
that borrower's assets, including equipment and related leases. Borrowings on
the warehouse facility are recourse jointly to certain of the affiliated
partnerships and limited liability companies, the Partnership and the General
Partner.
The credit agreement includes certain financial covenants applicable to each
borrower. The Partnership was in compliance with its covenants as of March 31,
2003.
9
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Statements contained in this Item 2, "Management's Discussion and Analysis of
Financial Condition and Results of Operations," and elsewhere in this Form 10-Q,
which are not historical facts, may be forward-looking statements. Such
statements are subject to risks and uncertainties that could cause actual
results to differ materially from those projected. Investors are cautioned not
to attribute undue certainty to these forward-looking statements, which speak
only as of the date of this Form 10-Q. We undertake no obligation to publicly
release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this Form 10-Q or to reflect the occurrence of
unanticipated events, other than as required by law.
Capital Resources and Liquidity
In the first quarters of 2003 and 2002, the Partnership's primary source of cash
was operating lease rents. The liquidity of the Partnership will vary in the
future, increasing to the extent cash flows from leases and proceeds from asset
sales exceed expenses, and decreasing as distributions are made to the limited
partners and to the extent expenses exceed cash flows from leases and proceeds
from sales of assets.
As another source of liquidity, the Partnership has contractual obligations with
a diversified group of lessees for fixed lease terms at fixed rental amounts. As
the initial lease terms expire, the Partnership will re-lease or sell the
equipment. The future liquidity beyond the contractual minimum rentals will
depend on the General Partner's success in re-leasing or selling the equipment
as it comes off lease.
The Partnership participates with the General Partner and certain of its
affiliates in a $56,191,292 revolving line of credit comprised of an acquisition
facility and a warehouse facility) with a financial institution that includes
certain financial covenants. The line of credit expires on June 28, 2004. As of
March 31, 2003, borrowing under the facility were as follows:
Amount borrowed by the Partnership under the acquisition facility $ -
Amounts borrowed by affiliated partnerships and limited liability companies
under the acquisition facility 17,200,000
-----------------
Total borrowings under the acquisition facility 17,200,000
Amounts borrowed by the General Partner and its sister corporation under the
warehouse facility -
-----------------
Total outstanding balance $ 17,200,000
=================
Total available under the line of credit $ 56,191,292
Total outstanding balance (17,200,000)
-----------------
Remaining availability $ 38,991,292
=================
Draws on the acquisition facility by any individual borrower are secured only by
that borrower's assets, including equipment and related leases. Borrowings on
the warehouse facility are recourse jointly to certain of the affiliated
partnerships and limited liability companies, the Partnership and the General
Partner.
The Partnership anticipates reinvesting a portion of lease payments from assets
owned in new leasing transactions. Such reinvestment will occur only after the
payment of all obligations, including debt service (both principal and
interest), the payment of management and acquisition fees to the General Partner
and providing for cash distributions to the Limited Partners.
The Partnership currently has available adequate reserves to meet contingencies,
but in the event those reserves were found to be inadequate, the Partnership
would likely be in a position to borrow against its current portfolio to meet
such requirements. The General Partner envisions no such requirements for
operating purposes.
As of March 31, 2003, the Partnership had borrowed $59,077,347 on a non-recourse
basis with remaining unpaid balances of $493,376. Borrowings are to be generally
non-recourse to the Partnership, that is, the only recourse of the lender upon a
default by the lessee on the underlying lease will be to the equipment or
corresponding lease acquired with the loan proceeds. The General Partner does
not anticipate any future non-recourse borrowings.
If inflation in the general economy becomes significant, it may affect the
Partnership inasmuch as the residual (resale) values and rates on re-leases of
the Partnership's leased assets may increase as the costs of similar assets
increase. However, the Partnership's revenues from existing leases would not
increase, as such rates are generally fixed for the terms of the leases without
adjustment for inflation.
10
If interest rates increase significantly, the lease rates that the Partnership
can obtain on future leases will be expected to increase as the cost of capital
is a significant factor in the pricing of lease financing. Leases already in
place, for the most part, would not be affected by changes in interest rates.
Cash Flows
In the first quarter of 2003, the Partnership's primary operating source of cash
was sales proceeds, whereas in the first quarter of 2002 it was from revenues
from operating leases. Operating lease revenues decreased by $808,524, primarily
as a result of sales of operating lease assets over the last year. In addition,
off lease inventory increased from $700,516 in the first quarter of 2002 to
$1,336,320 in the first quarter of 2003 resulting in decreased rental income.
In the first quarter of 2003, the Partnership's primary source of cash flows
from investing activities was proceeds from sales of lease assets. Such sales
proceeds are not expected to be consistent from one period to another. In the
first quarter of 2002, the primary source of cash flows from investing
activities was direct finance lease rents.
In the first quarters of 2003 and 2002, the single largest financing use of cash
was distributions to limited partners. The amount of such distributions
increased to $1,875,004 in the first quarter of 2003 from $1,088,393 in the
first quarter of 2002. As a result of scheduled debt payments, certain notes
have been paid off. This led to an overall reduction in the amounts of cash used
to repay debt in the current period compared to the same period in 2002.
Results of operations
First quarter operations resulted in a net loss of $635,616 in 2003, compared to
a net loss of $98,057 in 2002.
Operating lease revenues (and the related depreciation expense) have decreased
as a result of sales of assets over the last year. The original cost of assets
on operating leases has declined from $50,630,296 at March 31, 2002 to
$29,906,440 at March 31, 2003. Direct financing lease revenues have decreased
due to the same cause.
As scheduled debt payments have been made, debt balances have been reduced. This
decrease in indebtedness caused interest expense to decrease by $254,297 in the
current period compared to the same period in 2002.
Sales of lease assets decreased in the first quarter of 2003 compared to the
same period in 2002. Gains recognized on these sales decreased from $85,435 in
2002 to $64,135 in 2003.
In 2003, there were charges to net income for impairments of operating lease
assets in the amount of $553,426. The charges related to covered grain hopper
cars on lease to various lessees. The impairment resulted from decreased
estimated cash flows expected to be generated by the assets over their remaining
lives.
Item 3. Quantitative and Qualitative Disclosures of Market Risk.
The Partnership, like most other companies, is exposed to certain market risks,
including primarily changes in interest rates. The Partnership believes its
exposure to other market risks including foreign currency exchange rate risk,
commodity risk and equity price risk are insignificant to both its financial
position and results of operations.
In general, the Partnership manages its exposure to interest rate risk by
obtaining fixed rate debt. The fixed rate debt is structured so as to match the
cash flows required to service the debt to the payment streams under fixed rate
lease receivables. The payments under the leases are assigned to the lenders in
satisfaction of the debt. Furthermore, the Partnership has historically been
able to maintain a stable spread between its cost of funds and lease yields in
both periods of rising and falling rates.
Item 4. Controls and procedures.
Internal Controls
As of March 31, 2003, an evaluation was performed under the supervision and with
the participation of the Partnership's management, including the CEO and CFO of
the General Partner, of the effectiveness of the design and operation of the
Partnership's disclosure controls and procedures. Based on that evaluation, the
Partnership's management, including the CEO and CFO of the General Partner,
concluded that the Partnership's disclosure controls and procedures were
effective as of March 31, 2003. There have been no significant changes in the
Partnership's internal controls or in other factors that could significantly
affect internal controls subsequent to March 31, 2003.
Changes in internal controls
There have been no significant changes in our internal controls or in other
factors that could significantly affect our disclosure controls and procedures
subsequent to the evaluation date, nor were there any significant deficiencies
or material weaknesses in our internal controls.
11
Evaluation of disclosure controls and procedures
Under the supervision and with the participation of our management, including
the CEO and CFO, an evaluation of the effectiveness of the design and operation
of the Partnership's disclosure controls and procedures, as defined in Rules
240.13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934 was
performed as of a date within ninety days before the filing date of this
quarterly report. Based upon this evaluation, the CEO and CFO of the General
Partner concluded that, as of the evaluation date, our disclosure controls and
procedures were effective for the purposes of recording, processing, summarizing
and timely reporting information required to be disclosed by us in the reports
that we file under the Securities Exchange Act of 1934 and that such information
is accumulated and communicated to our management in order to allow timely
decisions regarding required disclosure.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
The following is a discussion of legal matters involving the Partnership, but
which do not represent claims against the Partnership or its assets. No other
material legal proceedings are currently pending against the Partnership or
against any of its assets.
Quaker Coal Company:
On December 31, 1997, Quaker Coal Company (the "Debtor"), one of the
Partnership's lessees, requested a moratorium on lease payments from January
through March 1998. No lease payments were made by the lessee through June 1998,
and as a result, the General Partner declared the Debtor in default.
Subsequently, the Debtor cured the outstanding payments and eventually satisfied
substantially all lease payments due under the lease; however, the General
Partner refused to waive the default and insisted on contractual damages. The
General Partner filed a suit against the Debtor for its contractual damages in
the U.S. District Court of Northern California (the "Court"). On June 16, 2000,
the Debtor filed for protection under Chapter 11 of the U.S. Bankruptcy Code.
The amounts of these damages have not been included in the financial statements
included in Part I, Item 1 of this report.
The Partnership obtained a stipulation for relief from the automatic bankruptcy
stay to allow the Court to issue its ruling, and filed a request to participate
on the Official Committee of Unsecured Creditors in the bankruptcy proceedings.
The Partnership succeeded upon securing the return of its equipment, which has
since been liquidated. The Court issued a ruling on March 4, 2001, denying the
Partnership's claim for damages. The Debtor subsequently filed a claim against
the Partnership for reimbursement of its legal expenses. The General Partner
believes the Court's decision is erroneous as a matter law, and has filed an
appeal of the decision in the U.S. District Court of Appeals. (See discussion
below).
The Debtor filed a plan of reorganization, which was objected to by several
large creditors, including the General Partner. These creditors were also
seeking a formal role on the creditors committee or formation of their own
committee.
Upon the termination of the Debtor's exclusivity period, competing plans were
filed by other creditors to the plan, and voting on the competing plans occurred
October 8, 2001. The results of the vote were that another of the creditor's
(i.e., American Electric Power's ("AEP"), Plan of Reorganization ("AEP Plan")
was successful. Under the AEP Plan, the claim of the Partnership has been
assigned to a liquidating trustee for resolution and satisfaction from the
Debtor's estate.
In January 2002, the Partnership attended an appellate settlement conference
seeking to resolve the outstanding disputed claim. A reserve has been set aside
by the Debtor's liquidating trustee in the amount of $1.2 million in partial
satisfaction of the Partnership's claim, although this claim amount remains in
dispute. In January 2003, the Federal Appellate Court in San Francisco heard an
appeal of the lower Court's decision. The results of that appellate decision was
handed down in March of 2003 and was adverse to the Partnership's position. The
Partnership is currently considering requesting a rehearing of that decision.
Currently, the likelihood of recovery of amounts above the payment of the lease
rent and the liquidation of the equipment already received remains speculative
and highly uncertain.
Ingersoll International:
At December 31, 2002, the Partnership had commenced action against Ingersoll
International (the "Lessee") as the Partnership had declared them in default for
making an unauthorized assignment of part of the leased equipment. Subsequent to
December 31, 2002, the Partnership, the Lessee and the unauthorized party
reached an agreement in principal to have the unauthorized party assume a
portion of the lease. This matter was resolved by March 31, 2003.
Item 2. Changes In Securities.
Inapplicable.
12
Item 3. Defaults Upon Senior Securities.
Inapplicable.
Item 4. Submission Of Matters To A Vote Of Security Holders.
Inapplicable.
Item 5. Other Information.
Inapplicable.
Item 6. Exhibits And Reports On Form 8-K.
(a) Documents filed as a part of this report
1. Financial Statements
Included in Part I of this report:
Balance Sheets, March 31, 2003 and December 31, 2002.
Statements of Operations for the three month periods ended March 31,
2003 and 2002.
Statement of Changes in Partners' Capital for the three month period
ended March 31, 2003.
Statements of Cash Flows for the three month periods ended March 31,
2003 and 2002.
Notes to the Financial Statements
2. Financial Statement Schedules
All other schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission are
not required under the related instructions or are inapplicable, and
therefore have been omitted.
(b) Report on Form 8-K
None
13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date:
May 13, 2003
ATEL CASH DISTRIBUTION FUND V, L.P.
(Registrant)
By: ATEL Financial Corporation
General Partner of Registrant
By: /s/ Dean L. Cash
------------------------------------
Dean L. Cash
President and Chief Executive Officer
of General Partner
By: /s/ Paritosh K. Choksi
------------------------------------
Paritosh K. Choksi
Principal Financial Officer
of Registrant
By: /s/ Donald E. Carpenter
------------------------------------
------------------------------------
Donald E. Carpenter
Principal Accounting
Officer of Registrant
14
CERTIFICATIONS
I, Paritosh K. Choksi, certify that:
1. I have reviewed this quarterly report on Form 10-Q of ATEL Cash Distribution
Fund V, LP;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
Date:
May 13, 2003
/s/ Paritosh K. Choksi
- ------------------------------
Paritosh K. Choksi
Principal Financial Officer of Registrant, Executive
Vice President of General Partner
15
CERTIFICATIONS
I, Dean L. Cash, certify that:
1. I have reviewed this quarterly report on Form 10-Q of ATEL Cash Distribution
Fund V, LP;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
Date:
May 13, 2003
/s/ Dean L. Cash
- ------------------------------
Dean L. Cash
President and Chief Executive
Officer of General Partner
16
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly report on Form 10-Q of ATEL Cash Distribution
Fund V, LP, (the "Partnership") for the period ended March 31, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
and pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the
Sarbanes-Oxley Act of 2002, I, Dean L. Cash, Chief Executive Officer of ATEL
Financial Services, LLC, general partner of the Partnership, hereby certify
that:
1. The Report fully complies with the requirements of section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Partnership.
Date:
May 13, 2003
/s/ Dean L. Cash
- ------------------------------
Dean L. Cash
President and Chief Executive
Officer of General Partner
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly report on Form 10-Q of ATEL Cash Distribution
Fund V, LP, (the "Partnership") for the period ended March 31, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
and pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the
Sarbanes-Oxley Act of 2002, I, Paritosh K. Choksi, Chief Financial Officer of
ATEL Financial Services, LLC, general partner of the Partnership, hereby certify
that:
1. The Report fully complies with the requirements of section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Partnership.
Date:
May 13, 2003
/s/ Paritosh K. Choksi
- -------------------------------
Paritosh K. Choksi
Executive Vice President of General
Partner, Principal Financial Officer of Registrant
17