<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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, 1998.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM JULY 1, 1998 TO SEPTEMBER 30, 1998.
Commission File number: 0-16835 (formerly 33-12125-A)
-----------------------------
SOUTHEAST ACQUISITIONS I, L.P.
- --------------------------------------------------------------------------------
(Exact name of registrant)
Delaware 23-2454443
- -------- ----------
(State or other jurisdiction of
incorporation or organization) (I.R.S. Employer Identification No.)
301 South Perimeter Park Drive
Nashville, Tennessee 37211
(Address of Principal Executive Offices)
Issuer's Telephone Number: 615-834-0872
------------
Indicate by check mark whether the registrant (a) 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
---- ----
<PAGE> 2
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
The unaudited financial statements of Southeast Acquisitions I, L.P.
(the "Partnership") at September 30, 1998 are attached hereto as Exhibit A.
Item 2 - Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Background
The Partnership was formed to acquire, own and realize appreciation in
a certain 202.72 acre parcel of undeveloped land near Columbia, South Carolina
(the "Property") by holding it for investment and eventual sale. However, there
can be no assurance that the partnership's objectives will be realized.
Results of Operations for Third Quarter of 1998 Compared with Third
Quarter of 1997
The Partnership activities for the third quarter of 1998 and the third
quarter of 1997 were focused on the sale of Partnership property. During the
third quarter of 1998 there were no sales. Other receipts during the third
quarter of 1998 consisted of interest income of $816 compared with $959 in the
third quarter of 1997.
Expenses in the third quarter of 1998 included general and
administrative expenses of $3,744 versus $41,625 in the third quarter of 1997.
The latter amount includes $40,000 for legal and printing costs related to the
proxy statement of September 22, 1997 which made revisions to the Partnership
Agreement including selection of a new General Partner. In addition, the
Partnership had $2,025 of management fees in the third quarter of 1998 as
compared with no such fees in the third quarter of 1997, due to the presence of
a new general partner admitted to the Partnership in the third quarter of 1997.
Other expenses in the third quarter of 1998 were real estate taxes of $69 and
insurance of $81, which were comparable to the same expenses in the third
quarter of 1997.
Inflation did not have any material impact on operations during the
third quarter of 1998 and it is not expected to materially impact future
operations.
To facilitate the possible sale of parcels, the Partnership might build
a short, stub road off Killian Road. To minimize the expense of building such a
road, the Partnership made an agreement with a timber company to timber the
Property and to locate one of their timber roads in an area where the
Partnership would build the spine road. This was done at no expense to the
Partnership.
<PAGE> 3
The Partnership has not determined to construct the stub road as of
this date.
Liquidity and Capital Resources
The Partnership has cash reserves of $81,859 at September 30, 1998, to
cover the following estimated annual costs: management fees $8,100, accounting
$14,000, legal $10,400, insurance $450, taxes $300, and other administrative
costs $3,900. In the General Partner's opinion, the Partnership's reserves will
be sufficient for an additional three years. However, if additional expenses are
incurred or should the Partnership decide to complete construction of the stub
road into the Property (as discussed earlier), the reserves may be inadequate to
cover the Partnership's operating expenses. If the reserves are exhausted, the
Partnership may have to dispose of some of the Property or incur indebtedness on
unfavorable terms.
PART II - OTHER INFORMATION
Item 1 - Legal Proceedings
None
Item 2 - Changes in Securities
There are no change in the Partnership's securities during the third
quarter of fiscal year 1998.
Item 3 - Defaults Upon Senior Securities
There was no default in the payment of principal, interest, a sinking
or purchase fund installment or any other default with respect to any
indebtedness of the Partnership. The Partnership has issued no preferred stock;
accordingly, there has been no arrearages or delinquencies with respect to any
such preferred stock.
Item 4 - Submission of Matters to a Vote of Security Holders
No matters were submitted to the Partners for a vote during the third
quarter of 1998.
<PAGE> 4
Item 5 - Other Information
None
Item 6 - Exhibits and Reports on Form 8-K
Reports on Form 8-K
None
Exhibits (numbered in accordance with Item 601 of Regulation S-K)
Exhibit Numbers Description Page Number
- --------------- ----------- -----------
27 Financial Data Schedule
<PAGE> 5
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the date indicated.
Signature Title Date
- --------- ----- ----
Richard W. Sorenson
- ----------------------------- Member, October 27, 1998
Richard W. Sorenson Southern Management ----------
Group, LLC
<PAGE> 6
EXHIBIT A
SOUTHEAST ACQUISITIONS I, LP
BALANCE SHEETS
<TABLE>
<CAPTION>
SEPTEMBER 30, December 31,
1998 1997
----------- -----------
(Unaudited)
ASSETS
<S> <C> <C>
Land held for sale $ 2,309,693 $ 2,520,000
Cash and cash equivalents 81,859 41,131
Prepaid insurance 81 --
----------- -----------
$ 2,391,633 $ 2,561,131
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Accounts payable and accrued expenses $ 10,111 $ 17,739
Partners' equity:
General partner (9,847) (10,764)
Limited partners (4,225 units outstanding) 2,391,369 2,554,156
----------- -----------
2,381,522 2,543,392
----------- -----------
$ 2,391,633 $ 2,561,131
=========== ===========
</TABLE>
See notes to financial statements.
<PAGE> 7
EXHIBIT A
SOUTHEAST ACQUISITIONS I, LP
STATEMENTS OF OPERATIONS AND PARTNERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE NINE MONTHS
ENDED SEPT 30 ENDED SEPT 30
---------------------------- ----------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES:
Gain on sale of land $ -- $ -- $ 122,887 $ --
Interest income 816 959 3,715 2,456
Other income -- 225 -- 225
----------- ----------- ----------- -----------
$ 816 $ 1,184 $ 126,602 $ 2,681
----------- ----------- ----------- -----------
EXPENSES:
General and administrative 3,744 41,625 28,441 45,285
Management fee 2,025 -- 6,075 --
Real estate taxes 69 72 212 218
Insurance 81 46 244 138
----------- ----------- ----------- -----------
5,919 41,743 34,972 45,641
----------- ----------- ----------- -----------
NET INCOME (LOSS) (5,103) (40,559) 91,630 (42,960)
Partners' equity,
Beginning of period 2,386,625 2,601,146 2,543,392 2,603,547
----------- ----------- ----------- -----------
Capital distribution -- -- (253,500) --
Partners' equity,
End of period $ 2,381,522 $ 2,560,587 $ 2,381,522 $ 2,560,587
=========== =========== =========== ===========
Weighted average number
of limited partnership
units outstanding 4,225 4,225 4,225 4,225
=========== =========== =========== ===========
Income (loss) from operations
per limited partnership
interest $ (1.19) $ (9.50) $ 21.47 $ (10.07)
=========== =========== =========== ===========
</TABLE>
See notes to financial statements.
<PAGE> 8
EXHIBIT A
SOUTHEAST ACQUISITIONS I, LP
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS
ENDED SEPT 30
-----------------------
1998 1997
--------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Proceeds from sale of land $ 333,194 $ --
Interest income received 3,715 2,456
Other income received -- 225
Cash paid for operating expenses (42,681) (8,597)
--------- --------
Net cash provided by (used in)
operating activities 294,228 (5,916)
CASH FLOWS FROM FINANCING ACTIVITIES:
Distribution to limited partners (253,500) --
--------- --------
Increase (decrease) in cash 40,728 (5,916)
Cash, beginning of period 41,131 91,596
--------- --------
Cash, end of period $ 81,859 $ 85,680
========= ========
RECONCILIATION OF NET INCOME (LOSS) TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Net income (loss) $ 91,630 $(42,960)
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operating activities:
Gain on sale of land (122,887) --
Net proceeds from sale of land 333,194 --
(Decrease) increase in accounts payable and accrued expenses (7,627) 37,044
Increase in prepaid expenses (82) --
--------- --------
Net cash provided by (used in) operating
activities $ 294,228 $ (5,916)
========= ========
</TABLE>
See notes to financial statements.
<PAGE> 9
SOUTHEAST ACQUISITIONS I, LP
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For the Nine Months Ended September 30, 1998
(Unaudited)
A. ACCOUNTING POLICIES
The unaudited financial statements presented herein have been prepared
in accordance with the instructions to Form 10-Q and do not include all
of the information and note disclosures required by generally accepted
accounting principles. These statements should be read in conjunction
with the financial statements and notes thereto included in the
Partnership's Form 10-K for the year ended December 31, 1997. In the
opinion of management, such financial statements include all
adjustments, consisting only of normal recurring adjustments, necessary
to summarize fairly the Partnership's financial position and results of
operations. The results of operations for the nine-month period ended
September 30, 1998 may not be indicative of the results that may be
expected for the year ending December 31, 1998.
B. RELATED PARTY TRANSACTIONS
The General Partner and its affiliates have been actively involved in
managing the Partnership's operations. Compensation earned for these
services in the first nine months were as follows:
<TABLE>
<CAPTION>
1998 1997
------ ----
<S> <C> <C>
Management Fees $6,075 --
Accounting Fees -- --
Transfer Fees $ 600 --
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 81,859
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 81
<PP&E> 2,309,693
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,391,633
<CURRENT-LIABILITIES> 10,111
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,381,522
<TOTAL-LIABILITY-AND-EQUITY> 2,391,633
<SALES> 122,887
<TOTAL-REVENUES> 126,602
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 34,972
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 91,630
<INCOME-TAX> 0
<INCOME-CONTINUING> 91,630
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 91,630
<EPS-PRIMARY> 21.47
<EPS-DILUTED> 21.47
</TABLE>
