Attached files
file | filename |
---|---|
EX-2.2 - EX-2.2 - CRONOS GLOBAL INCOME FUND XV LP | f59708exv2w2.htm |
EX-2.1 - EX-2.1 - CRONOS GLOBAL INCOME FUND XV LP | f59708exv2w1.htm |
Table of Contents
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
August 1, 2011
Date of Report (Date of Earliest Event Reported)
Date of Report (Date of Earliest Event Reported)
Cronos Global Income Fund XV, L.P.
(Exact name of registrant as specified in its charter)
California
(State or Other Jurisdiction of Incorporation)
0-23886 | 94-3186624 | |
(Commission File Number) | (IRS Employer Identification No.) |
One Front Street, Suite 925, San Francisco, California 94111
(Address of principal executive offices) (Zip Code)
(Address of principal executive offices) (Zip Code)
(415) 677-8990
(Funds Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR § 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR § 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR § 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR § 240.13e-4(c)) |
TABLE OF CONTENTS
Item 1.01 Entry into a Material Definitive Agreement | ||||||||
Item 2.01 Completion of Acquisition or Disposition of Assets | ||||||||
Item 9.01 Financial Statements and Exhibits | ||||||||
SIGNATURES | ||||||||
EXHIBIT INDEX | ||||||||
EX-2.1 | ||||||||
EX-2.2 |
Table of Contents
Item 1.01 | Entry into a Material Definitive Agreement. |
The Registrant, Cronos Global Income Fund XV, L.P., a California limited partnership (the
Fund), was organized on August 26, 1993 to engage in the business of owning and leasing
marine cargo containers to third-party lessees. The Fund is managed by Cronos Capital Corp., a
California corporation (CCC), its general partner.
One of the principal investment objectives of the Fund was to lease its containers for ten to
fifteen years, and then to dispose of them and liquidate. In March 2011, the Partnership commenced
its eighteenth year of operations. Through occasional sales, retirements and casualty losses, the
Fund had sold or disposed of approximately 76% of its container fleet (measured on a TEU-basis) as
of June 30, 2011. With the reduction in the size of the Funds container fleet, the administrative
expenses incurred by the Fund, as a percent of its gross revenues, have increased. For this
reason, and consistent with the Funds investment objectives, CCC, as the general partner,
concluded that it would be in the best interest of the Fund and its limited partners to sell its
remaining containers in bulk.
CCC distributed a request for proposal (RFP) on May 31, 2011 to third parties
seeking their interest in purchasing the Funds remaining containers. As of March 31, 2011 (the
date of the data in the RFP), the Fund owned 5,772 twenty-foot, 2,623 forty-foot, and 900
forty-foot high cube marine dry cargo containers, as well as 12 twenty-foot and 2 forty-foot high
cube refrigerated cargo containers and 180 tank containers.
The RFP included extensive information on the operating performance of the Funds containers,
information about the leases to which the containers are subject, information on the prior sales of
the Funds containers, and copies of the Funds first quarter 2011 10-Q.
No conditions were imposed by CCC on prospective bidders with respect to the contents of their
bids, with the exception of the following: bids had to be received by CCC by June 17, 2011, and
the bidders had to identify the source of capital the bidder would rely upon to fund the purchase,
the number of days required for due diligence (not to exceed 15), the number of days following the
completion of due diligence (not to exceed 15) that the bidder would consider reasonable for
closing, the amount of deposit the bidder would agree to make (not to be less than $10,000), any
conditions, other than the completion of due diligence, which applied to the bid, and the identity
of bidders counsel.
CCC indicated in the RFP that the target for consummating a sale of the Funds remaining
containers was August 1, 2011. CCC retained the discretion to vary the bidding procedures and to
conduct the process leading to any sale of the Funds containers as it determined, in its sole
discretion as general partner of the Fund, to be appropriate.
CCC distributed the RFP to 18 parties, including competitors of CCC in the container leasing
business. Three parties submitted proposals to purchase the Funds remaining containers. CCC
selected the highest bidder, P&R Equipment & Finance
Corporation, a company organized and existing under the laws of
Switzerland (P&R), to conduct final due diligence. During the due
diligence process, P&R teamed with one of its strategic business partners,
2
Table of Contents
Transportation
Capital Partners, LLC (TCP), a California limited
liability company. After conducting due diligence, P&R finalized its joint bid with
TCP for the amount of $11,087,439 (the P&R and TCP Bid), subject to further adjustment for containers not
readily saleable or disposed of prior to the date of closing. CCC accepted the bid on July 22,
2011. As of June 30, 2011, the book value of the Funds remaining containers
and direct financing lease receivables was $3,446,936.
Affiliates
of CCC manage containers for P&R, on terms CCC deems customary in the
container leasing industry. The fleet of containers that affiliates of
CCC manage for P&R represents approximately 7% (measured by
TEUs) of the container fleet owned and managed by CCC and
affiliates
On August 1, 2011, the Fund completed the sale of 9,055 of its remaining containers
and direct financing lease receivables to P&R and TCP. The final cash purchase amount was $11,087,439. All but 74 containers owned by
the Fund were sold to P&R and TCP, the retained containers consisting of those subject to a
bargain purchase option by the lessee or not readily saleable by reason of the location of the
containers, the credit status of the lessee(s) of the containers, and/or the condition of the containers.
The P&R and TCP Asset Sale Agreements (Agreements) are included with this report as exhibits.
The Agreements contain an
indemnification covenant (§ 9). To allow the Fund to liquidate and dissolve, the Funds indemnification
covenant did not survive the closing of the sale, August 1, 2011. The only recourse for
indemnification that P&R and TCP have under the Agreements is against CCC, which covenant will generally expire on December 31,
2011.
The effective date on the Agreements is July 1, 2011. From and after that date, the buyers, P&R and TCP, are entitled to all net lease revenues and sales proceeds (if any) attributable to the
purchased containers.
P&R and TCP requested that an affiliate of CCC manage the containers purchased by
P&R and TCP from the Fund. Upon the closing of the sale of the Funds containers to
P&R and TCP, CCCs affiliate entered into separate management agreements with P&R and TCP for
the containers bought by P&R and TCP from the Fund. The terms of the management agreements
between CCCs affiliate and both P&R and TCP were negotiated at arms length with each party.
CCCs affiliates management of the Funds containers was not imposed as a condition by
CCC to the proposed sale of the Funds containers to P&R and TCP (or any other party). CCC
believes that the terms of the management agreements between its affiliate and P&R and TCP are
customary in the container leasing industry.
With the completion of this sale of containers, the Fund has now resolved to wind up and
dissolve. CCC will proceed with the orderly liquidation of the Fund, the payment of its remaining
liabilities, and the distribution of the net proceeds of the Funds liquidation to the partners of
the Fund. CCC anticipates that the Fund will make one liquidating distribution to the limited
partners of the Fund, representing the net proceeds from the sale of its containers and direct financing leases and the Funds
other remaining assets (after payment or reservation for payment of the Funds liabilities), to be
paid on or about September 15, 2011 to limited partners of record on August 1, 2011. CCC is not
prepared at this time to estimate the amount of the final distribution, pending disposal of the
Funds remaining containers and completion of an accounting review of the Funds remaining
liabilities to be discharged prior to the Funds termination. CCC anticipates that the Fund will
complete its liquidation by September 30, 2011 and de-register the Funds outstanding Units under
the Securities Exchange Act of 1934, as amended ( Exchange Act), thereby terminating the
Funds obligation to file further periodic reports under the Exchange Act with the Securities and Exchange
Commission.
3
Table of Contents
Item 2.01 | Completion of Acquisition or Disposition of Assets. |
See
the discussion of the sale of the Funds remaining containers
and direct financing leases under Item 1.01 above.
Item 9.01 | Financial Statements and Exhibits |
(c) Exhibits
Exhibit 2.1
|
Asset Sale Agreement, dated as of August 1, 2011, by and among Cronos Capital Corp., Cronos Global Income Fund XV, L.P., and P&R Equipment & Finance Corporation. | |
Exhibit 2.2
|
Asset Sale Agreement, dated as of August 1, 2011, by and among Cronos Capital Corp., Cronos Global Income Fund XV, L.P., and Transportation Capital Partners, LLC. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CRONOS GLOBAL INCOME FUND XV, L.P., |
||||
By Cronos Capital Corp., | ||||
The General Partner | ||||
By |
/s/ Frank P. Vaughan
|
|||
Frank P. Vaughan | ||||
Chief Financial Officer | ||||
Date: August 5, 2011
4
Table of Contents
EXHIBIT INDEX
Exhibit 2.1
|
Asset Sale Agreement, dated as of August 1, 2011, by and among Cronos Capital Corp., Cronos Global Income Fund XV, L.P., and P&R Equipment & Finance Corporation. | |
Exhibit 2.2
|
Asset Sale Agreement, dated as of August 1, 2011, by and among Cronos Capital Corp., Cronos Global Income Fund XV, L.P., and Transportation Capital Partners, LLC. |
5