UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM 10-Q
----------------
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
--- SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2004
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
--- SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___ to ___
----------------
Commission File No. 33-10122
----------------
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
State of Organization: California
IRS Employer Identification No. 94-3023671
201 High Ridge Road, Stamford, Connecticut 06927
Telephone - (203) 357-3776
Indicate by check mark whether the registrant:(1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
--- ---
Indicate by check mark whether the registrant is an accelerated filer (as
defined in rule 12b-2 of the Exchange Act). Yes No X
--- ---
This document consists of 15 pages.
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
FORM 10-Q - For the Quarterly Period Ended September 30, 2004
INDEX
Part I. Financial Information Page
Item 1. Financial Statements (Unaudited)
a) Condensed Balance Sheets - September 30, 2004 and
December 31, 2003............................................3
b) Condensed Statements of Operations - Three and Nine Months
Ended September 30, 2004 and 2003............................4
c) Condensed Statements of Changes in Partners' Capital
(Deficit) - Year Ended December 31, 2003
and Nine Months Ended September 30, 2004.....................5
d) Condensed Statements of Cash Flows - Nine Months
Ended September 30, 2004 and 2003............................6
e) Notes to Condensed Financial Statements......................7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations...........10
Item 4. Controls and Procedures.................................13
Part II. Other Information
Item 1. Legal Proceedings.......................................14
Item 6. Exhibits................................................14
Signature ........................................................15
2
Part I. Financial Information
-----------------------------
Item 1. Financial Statements
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
CONDENSED BALANCE SHEETS
(Unaudited)
September 30, December 31,
2004 2003
---- ----
ASSETS:
CASH AND CASH EQUIVALENTS $ 1,664,808 $ 2,524,997
RECEIVABLE FROM AFFILIATE 20,880 --
OTHER RECEIVABLES 1,147 1,836
AIRCRAFT HELD FOR SALE 570,000 400,000
PREPAID EXPENSE 1,138 --
----------- -----------
Total Assets $ 2,257,973 $ 2,926,833
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT):
PAYABLE TO AFFILIATES $ -- $ 96,353
ACCOUNTS PAYABLE AND ACCRUED
LIABILITIES 66,221 54,420
----------- -----------
Total Liabilities 66,221 150,773
----------- -----------
PARTNERS' CAPITAL (DEFICIT):
General Partner (3,868,519) (3,862,671)
Limited Partners, 499,553 units in 2004
and 499,683 units in 2003
issued and outstanding 6,060,271 6,638,731
----------- -----------
Total Partners' Capital 2,191,752 2,776,060
----------- -----------
Total Liabilities and Partners' Capital $ 2,257,973 $ 2,926,833
=========== ===========
The accompanying notes are an integral part of these condensed statements.
3
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2004 2003 2004 2003
---- ---- ---- ----
REVENUES:
Rent from operating leases $ -- $ 441,109 $ -- $ 1,376,965
Interest 7,973 5,555 17,958 17,624
Lessee return condition settlements -- 44,270 -- 44,270
Lessee settlements 81,458 -- 163,982 76,279
----------- ----------- ----------- -----------
Total Revenues 89,431 490,934 181,940 1,515,138
----------- ----------- ----------- -----------
EXPENSES:
Depreciation -- 803,786 -- 1,466,624
Write-up of aircraft held for sale (101,800) -- (170,000) --
Management fees to general partner -- 12,386 -- 38,510
Operating 37,791 13,472 121,519 42,604
Administration and other 69,287 85,688 259,526 258,777
----------- ----------- ----------- -----------
Total Expenses 5,278 915,332 211,045 1,806,515
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ 84,153 $ (424,398) $ (29,105) $ (291,377)
=========== =========== =========== ===========
NET INCOME (LOSS) ALLOCATED
TO THE GENERAL PARTNER $ 841 $ (4,244) $ 49,672 $ 197,478
=========== =========== =========== ===========
NET INCOME (LOSS) ALLOCATED
TO LIMITED PARTNERS $ 83,312 $ (420,154) $ (78,777) $ (488,855)
=========== =========== =========== ===========
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT $ 0.16 $ (0.84) $ (0.16) $ (0.98)
=========== =========== =========== ===========
The accompanying notes are an integral part of these condensed statements.
4
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
CONDENSED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(Unaudited)
Year Ended December 31, 2003 and
Nine Months Ended September 30, 2004
General Limited
Partner Partners Total
------- -------- -----
Balance, December 31, 2002 $(3,784,552) $ 9,420,501 $ 5,635,949
Net income (loss) 199,561 (282,650) (83,089)
Cash distribution to partners
($5.00 per Limited
Partnership Unit) (277,680) (2,499,120) (2,776,800)
----------- ----------- -----------
Balance, December 31, 2003 (3,862,671) 6,638,731 2,776,060
Net income (loss) 49,672 (78,777) (29,105)
Cash distribution to partners
($1.00 per Limited
Partnership Unit) (55,520) (499,683) (555,203)
----------- ----------- -----------
Balance, September 30, 2004 $(3,868,519) $ 6,060,271 $ 2,191,752
=========== =========== ===========
The accompanying notes are an integral part of these condensed statements.
5
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
2004 2003
---- ----
OPERATING ACTIVITIES:
Net loss $ (29,105) $ (291,377)
Adjustments to reconcile net loss to net
cash (used in) provided by operating
activities:
Depreciation -- 1,466,624
Write-up of aircraft held for sale (170,000) --
Changes in operating assets and liabilities:
Increase in receivable from affiliate (20,880) --
Decrease in rent and other receivables 689 97,855
(Decrease) increase in payable to
affiliates (96,353) 4,617
Increase (decrease) in accounts
payable and accrued liabilities 11,801 (59,481)
Decrease in deferred income -- (316,966)
Increase in prepaid expense (1,138) (4,126)
----------- -----------
Net cash (used in) provided by
operating activities (304,986) 897,146
----------- -----------
FINANCING ACTIVITIES:
Cash distributions to partners (555,203) (2,776,800)
----------- -----------
Net cash used in financing
activities (555,203) (2,776,800)
----------- -----------
CHANGES IN CASH AND CASH EQUIVALENTS (860,189) (1,879,654)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 2,524,997 4,118,926
----------- -----------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 1,664,808 $ 2,239,272
=========== ===========
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Transfer of operating lease assets to
assets held for sale $ -- $ 100,000
=========== ===========
The accompanying notes are an integral part of these condensed statements.
6
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Organization and the Partnership
Polaris Aircraft Income Fund III, A California Limited Partnership (PAIF-III or
the Partnership), was formed on June 27, 1984 for the purpose of acquiring and
leasing aircraft. The Partnership will terminate no later than December 2020.
Upon organization, both the General Partner and the initial Limited Partner
contributed $500 to capital. The Partnership recognized no profits or losses
during the periods ended December 31, 1984, 1985 and 1986. The offering of
depositary units (Units), representing assignments of Limited Partnership
interest, terminated on September 30, 1987 at which time the Partnership had
sold 500,000 units of $500, representing $250,000,000. All unit holders were
admitted to the Partnership on or before September 30, 1987 and are referred to
collectively as the Limited Partners. During January 1998, 40 units were
redeemed by the Partnership in accordance with section 18 of the Limited
Partnership Agreement. During the nine months ended September 30, 2004, 130
units were abandoned. At September 30, 2004, there were 499,553 units
outstanding, net of redemptions.
As of September 30, 2004, the Partnership owned four aircraft. On September 20,
2004, the Partnership entered into a Letter of Intent to sell its four remaining
aircraft to an unaffiliated buyer for a total selling price of $800,000. Upon
completion of such sale, the Partnership plans to liquidate all its assets in an
orderly manner, make a final distribution and terminate the Partnership
thereafter; however, it is uncertain when this liquidation will occur. While
there can be no assurance as to either the timing of such sale or whether such
sale may be completed, the General Partner intends to seek to complete such sale
during the fourth quarter of 2004.
Polaris Investment Management Corporation (PIMC), the sole General Partner of
the Partnership, supervises the day-to-day operations of the Partnership.
Polaris Depository Company III (PDC) serves as the depositary. PIMC and PDC are
wholly-owned subsidiaries of Polaris Aircraft Leasing Corporation (PALC).
Polaris Holding Company (PHC) is the parent company of PALC. General Electric
Capital Corporation (GE Capital), an affiliate of General Electric Company, owns
100% of PHC's outstanding common stock. PIMC has entered into a services
agreement dated as of July 1, 1994 with GE Capital Aviation Services, Inc.
(GECAS). Amounts paid and allocations to affiliates are described in Notes 3 and
4.
Note 2. Accounting Principles and Policies
In the opinion of management, the condensed financial statements presented
herein include all adjustments, consisting only of normal recurring items,
necessary to summarize fairly the Partnership's financial position and results
of operations. The financial statements have been prepared in accordance with
the instructions of the Quarterly Report to the Securities and Exchange
Commission (SEC) Form 10-Q. The condensed balance sheet at December 31, 2003,
has been derived from the audited financial statements at that date but does not
include all of the information and note disclosures required by accounting
principles generally accepted in the United States (GAAP). These statements
7
should be read in conjunction with the financial statements and notes thereto
for the years ended December 31, 2003, 2002, and 2001 included in the
Partnership's 2003 Annual Report to the SEC on Form 10-K.
Note 3. Related Parties
Under the Limited Partnership Agreement (the Agreement), the Partnership paid
the following amounts for the current quarter to the General Partner, PIMC, in
connection with services rendered or payments made on behalf of the Partnership:
Payments made during the
Three Months Ended
September 30, 2004
------------------
Out-of-Pocket Operating
Expense Reimbursement $ 68,264
Out-of-Pocket Administrative
Expense Reimbursement 178,363
--------
$246,627
========
As of September 30, 2004, the Partnership also has a net Receivable from
Affiliate of $20,880 which is comprised of a receivable due from PIMC totaling
$37,383 (see Note 6) and a payable due to PIMC totaling $16,503 representing
reimbursement of out-of-pocket administrative expenses.
Note 4. Partners' Capital
The Agreement stipulates different methods by which revenue, income and loss
from operations and gain or loss on the sale of aircraft are to be allocated to
the General Partner and the Limited Partners. Such allocations are made using
income or loss calculated under GAAP for book purposes, which varies from income
or loss calculated for tax purposes.
Cash available for distributions, including the proceeds from the sale of
aircraft, is distributed 10% to the General Partner and 90% to the Limited
Partners.
The different methods of allocating items of income, loss and cash available for
distribution combined with the calculation of items of income and loss for book
and tax purposes result in book basis capital accounts that may vary
significantly from tax basis capital accounts. The ultimate liquidation and
distribution of remaining cash will be based on the tax basis capital accounts
following liquidation, in accordance with the Agreement.
Note 5. Aircraft and Depreciation
The Partnership periodically reviews the estimated realizability of the residual
values at the projected end of each aircraft's economic life. For any downward
adjustment in estimated residual value or decrease in the projected remaining
economic life, the depreciation expense over the projected remaining economic
life of the aircraft has been increased.
8
Aircraft on lease were carried at cost unless deemed impaired, in which case the
asset was recorded at fair value. Aircraft on lease were deemed impaired, if the
projected net cash flow for each aircraft (projected rental revenue, net of
management fees, less projected maintenance costs, if any, plus the estimated
residual value) was less than the carrying value of the aircraft. An impairment
loss was recognized equal to the excess of the net carrying value of the asset
over its fair value.
Aircraft held for sale are carried at the lower of cost or fair value less cost
to sell. During the three and nine months ended September 30, 2004, the
Partnership recognized a write-up of $101,800 and $170,000, respectively, in the
carrying value of aircraft held for sale due to changes in estimated fair market
values based on the selling price of the Partnership's four aircraft in a Letter
of Intent to sell dated September 20, 2004. The adjustments to increase the net
carrying value did not result in a net carrying value in excess of the original
net carrying value of the assets when they were initially designated as held for
sale. Management believes the assumptions related to the fair value of impaired
assets represent the best estimates based on reasonable and supportable
assumptions and projections.
Note 6. Subsequent Events
On November 5, 2004, the Partnership received a payment of $85,853 representing
a distribution from an original administrative rent claim in the amount of
$465,277 filed against a former lessee's bankrupt estate. Also, in November
2004, the Partnership received a payment of $35,683 (plus interest of $1,700)
representing a distribution associated with the original rent claim that was
remitted by the bankruptcy estate to GECAS in December 2002. This payment is
included in Lessee Settlements on the Statement of Operations for the three and
nine months ended September 30, 2004 and is included in Receivable from
Affiliate as of September 30, 2004. Further, the Partnership expects to receive
an additional payment totaling $92,535 from the bankruptcy estate associated
with the administrative rent claim during the fourth quarter of 2004. As such it
is expected that the Partnership will ultimately received 100% of the
administrative claim amount.
9
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Forward-Looking Statements
Certain portions of this Quarterly Report on Form 10-Q contain forward-looking
statements that are based on management's expectations, estimates, projections
and assumptions. Words such as "expects", "anticipates", "plans", "believes",
"scheduled", "estimates" and variations of these words and similar expressions
are intended to identify forward-looking statements, which include but are not
limited to projections of revenues, earnings, cash flows, aircraft disposition
and the like. Forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995, as amended.
These statements are not guarantees of future performance and involve certain
risks and uncertainties, which are difficult to predict. Therefore, actual
future results and trends may differ materially from what is forecast in
forward-looking statements due to a variety of factors, including, without
limitation:
--General U.S. and international political and economic conditions;
--Changing demand preferences for business aircraft, including the
effects of economic conditions on the business-aircraft market;
All forward-looking statements speak only as of the date of this report, or, in
the case of any document incorporated by reference, the date of that document.
All subsequent written and oral forward-looking statements attributable to the
Partnership or any person acting on its behalf are qualified by the cautionary
statements in this report. The Partnership does not undertake any obligation to
update or publicly release any revisions to forward-looking statements to
reflect events, circumstances or changes in expectations after the date of this
report.
Business Overview
At September 30, 2004, Polaris Aircraft Income Fund III (PAIF-III or the
Partnership) owned a portfolio of four used McDonnell Douglas DC-9-30 commercial
jet aircraft (DC-9-30) out of its original portfolio of 38 aircraft. These
DC-9-30 aircraft were being stored in New Mexico and were being marketed for
sale. On September 20, 2004, the Partnership entered into a Letter of Intent to
sell its four remaining aircraft to an unaffiliated buyer for a total selling
price of $800,000. Upon completion of such sale, the Partnership plans to
liquidate all its assets in an orderly manner, make a final distribution and
terminate the Partnership thereafter; however, it is uncertain when this
liquidation will occur. While there can be no assurance as to either the timing
of such sale or whether such sale may be completed, the General Partner intends
to seek to complete such sale during fourth quarter of 2004.
Partnership Operations
The Partnership recorded net income of $84,153, or $0.16 per Limited Partnership
Unit, for the three months ended September 30, 2004, as compared to a net loss
of $424,398, or $0.84 per Limited Partnership Unit, for the three months ended
September 30, 2003. The Partnership recorded a net loss of $29,105, or $0.16 per
Limited Partnership Unit, for the nine months ended September 30, 2004, compared
to a net loss of $291,377, or $0.98 per Limited Partnership Unit, for the nine
months ended September 30, 2003. Variances in net income may not correspond to
variances in net income per Limited Partnership Unit due to the allocation of
components of income and loss in accordance with the Partnership Agreement.
10
The increase in net income during the three months ended September 30, 2004 and
the decrease in net loss for the nine months ended September 30, 2004, as
compared to the same periods in 2003, is primarily due to the write-up of the
carrying value of aircraft held for sale, an absence of depreciation expense and
management fees to the General Partner, partially offset by an absence of rental
income, along with an increase in operating expenses, as discussed below.
The absence of rental income from operating leases during the three and nine
months ended September 30, 2004, as compared to $441,109 and $1,376,965,
respectively, in the same periods in 2003, is due to all lease terms having
expired during 2003.
Interest income increased slightly during the three and nine months ended
September 30, 2004, as compared to the same periods in 2003, primarily due to
the recent increase in interest rates.
During the three and nine months ended September 30, 2004, the Partnership
recognized lessee settlement income in the amount of $81,458 and $163,982,
respectively, as compared to $0 and $76,279, respectively, recognized during the
same periods in 2003. The payments received during the 2004 and 2003 periods
resulted from distributions by a former lessee's bankrupt estate representing a
portion of the $465,277 administrative rent claims initially filed by the
Partnership pursuant to the bankruptcy (also see Note 6).
Lessee return condition settlements were $44,270 during the three and nine
months ended September 30, 2003, as compared to $0 for the same periods in 2004.
The return condition payment received during the 2003 periods was for an
aircraft that went off lease on September 15, 2003.
Aircraft held for sale are carried at the lower of cost or fair value less cost
to sell. During the three and nine months ended September 30, 2004, the
Partnership recognized income of $101,800 and $170,000, or $0.20 and $0.34,
respectively, per Limited Partnership Unit, on the write-up of the carrying
value of two of its aircraft, which previously had been reduced through
additional depreciation expense as the result of past reviews of estimated
market values. The estimated fair market value of the aircraft held for sale at
September 30, 2004 was based on the selling price of the Partnership's four
aircraft in the Letter of Intent dated September 20, 2004. The carrying value of
the Partnership's two other aircraft was not adjusted at September 30, 2004
because their cost basis determined at lease expiration was less than the
current estimated fair market value. No adjustments to the market value of
aircraft held for sale were made during the same periods in 2003.
The absence of depreciation expense and management fees to the General Partner
during the three and nine months ended September 30, 2004, as compared to the
same periods in 2003, was due to all lease terms having expired during 2003.
Operating expenses increased during the three and nine months ended September
30, 2004, as compared to the same periods in 2003, primarily due to maintenance
and storage-related costs associated with the aircraft while they are being held
for sale. During the three and nine months ended September 30, 2004, four
aircraft were held in storage, as compared to the same periods in 2003, when one
aircraft was kept in storage.
Administration and other expense decreased during the three months September 30,
2004, as compared to the same period in 2003, primarily due to decreased legal
fees related to various SEC and investor reporting matters and printing and
11
postage expenses. Administration and other expense increased slightly during the
nine months ended September 30, 2004, as compared to the same period in 2003.
Liquidity and Cash Distributions
Liquidity - No further rent payments were due during the nine months ended
September 30, 2004 since all lease terms expired during 2003. The Partnership
received all payments due from its sole lessee for the aircraft remaining on
lease during the nine months ended September 30, 2003.
PIMC, the General Partner, has determined that cash reserves be maintained as a
prudent measure to ensure that the Partnership has available funds for winding
up the affairs of the Partnership and for other contingencies. The Partnership
plans to liquidate all its assets in an orderly manner, make a final
distribution and terminate the Partnership thereafter, however, it is uncertain
when this liquidation will occur. On September 20, 2004, the Partnership entered
into a Letter of Intent to sell its four remaining aircraft to an unaffiliated
buyer for a total selling price of $800,000. While there can be no assurance as
to either the timing of such sale or whether such sale may be completed, the
General Partner intends to seek to complete such sale during fourth quarter of
2004. The Partnership's cash reserves will be monitored and may be revised from
time to time as further information becomes available in the future.
Cash Distributions - Cash distributions to Limited Partners during the nine
months ended September 30, 2004 and 2003 were $499,683, or $1.00 per Limited
Partnership Unit, and $2,499,120, or $5.00 per Unit, respectively. The General
Partner has determined that it is in the best interests of the Partnership to
suspend any further cash distributions until the Partnership is in a position to
dissolve, wind up and terminate, and make a final distribution of its remaining
cash. In reaching this conclusion, the General Partner considered the
anticipated costs of storing and insuring the aircraft pending sale, the
anticipated costs of marketing and preparing the aircraft for sale, the
anticipated costs of winding up the Partnership's business, the uncertainty as
to the period of time required to sell the aircraft and wind up the Partnership,
the uncertainty as to the terms on which the Partnership's aircraft may be sold
and the desirability of maintaining a prudent level of cash reserves for
Partnership needs and contingencies.
The Partnership does not have any material off-balance sheet commitments or
obligations.
12
Item 4. Controls and Procedures
(a) Evaluation of disclosure controls and procedures
PIMC management reviewed the Partnership's internal controls and procedures and
the effectiveness of these controls. As of September 30, 2004, PIMC management,
including its Chief Executive Officer and Chief Financial Officer, carried out
an evaluation of the effectiveness of the design and operation of the
Partnership's disclosure controls and procedures pursuant to Rules 13a-14(c) and
15d-14(c) of the Securities Exchange Act of 1934. Based upon that evaluation,
the Chief Executive Officer and Chief Financial Officer concluded that the
Partnership's disclosure controls and procedures are effective in timely
alerting them to material information relating to the Partnership required to be
included in its periodic SEC filings.
(b) Change to internal controls
There was no change in the Partnership's internal controls over financial
reporting or in other factors during the Partnership's last quarter that
materially affected, or are reasonably likely to materially affect, the
Partnership's internal controls over financial reporting. There were no
significant deficiencies or material weaknesses, and therefore no corrective
actions taken.
13
Part II. Other Information
--------------------------
Item 1. Legal Proceedings
As discussed in Item 3 of Part I of Polaris Aircraft Income Fund III's (the
Partnership) 2003 Annual Report to the Securities and Exchange Commission (SEC)
on Form 10-K (Form 10-K) and in Item 1 of Part II of the Partnership's Quarterly
Report to the SEC on Form 10-Q (Form 10-Q) for the period ended June 30, 2004,
there are several pending legal proceedings involving the Partnership. There
have been no material developments with respect to such proceedings during the
period covered by this report. However, the Partnership has received the
payments described in Note 6 to the Financial Statements.
Other Proceedings - Item 10 in Part III of the Partnership's 2003 Form 10-K and
Item 1 of Part II of the Partnership's Quarterly Report to the SEC on Form 10-Q
for the period ended June 30, 2004 discuss certain actions which have been filed
against Polaris Investment Management Corporation and others in connection with
the sale of interests in the Partnership and the management of the Partnership.
The Partnership is not a party to these actions. There have been no material
developments with respect to any of the actions described therein during the
period covered by this report.
Item 6. Exhibits
a) Exhibits (numbered in accordance with Item 601 of Regulation S-K)
31.1 CEO Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
31.2 CFO Certification Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
32.1 Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
14
SIGNATURE
Pursuant to the requirements of section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
POLARIS AIRCRAFT INCOME FUND III,
A California Limited Partnership
(Registrant)
By: Polaris Investment
Management Corporation,
General Partner
November 15, 2004 By: /s/Stephen E. Yost
- ----------------- ----------------------
Stephen E. Yost, Chief Financial Officer
15