<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 MARCH 31, 1999.
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
- ----- EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM JANUARY 1, 1999
TO MARCH 31, 1999.
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 March 31, 1999 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 First Quarter of 1999 Compared with First
Quarter of 1998
The Partnership activities for the first quarter of 1999 and the first
quarter of 1998 were focused on the sale of Partnership property. During the
first quarter of 1999 there were no sales, as compared with the first quarter of
1998, when the Partnership sold 16.918 acres of land fronting Killian Road. The
property sold in the first quarter of 1998 was sold for a gross price of $44,000
per acre and netted, after sales costs, $333,213 in revenue to the Partnership.
The conveyed property was a portion of a larger tract acquired in 1987 for
$17,170 per acre and the larger tract was independently appraised in 1996 for
$13,812 per acre. The site sold in the first quarter of 1998 has more value than
some of the sites in the rear portion of the tract which include 34.5+/- acres
that are situated in the flood plain. Other income during the first quarter of
1999 consisted of interest income of $551 as compared with $1,179 in the first
quarter of 1998. The decrease in interest income was primarily due to a lower
cash reserve remaining after making an owner distribution in the second quarter
of 1998.
Expenses in the first quarter of 1999 included general and
administrative expenses of $5,153 versus $8,398 in the second quarter of 1998.
The decrease was primarily due to lower legal fees and accounting fee accruals.
In addition, the Partnership had $2,025 of management fees in the second quarter
of 1999, which was the same amount incurred in the first quarter of 1998. Other
expenses in the first quarter of 1999 were real estate taxes of $79 and
insurance of $76, which were comparable to the same expenses in the first
quarter of 1998. The Partnership also paid Delaware franchise and excise tax
fees for 1998 that were expensed in the first quarter of 1999. The Partnership
was not aware of this tax liability until 1999. There will be an additional
Delaware franchise and excise tax of $100 due during the second quarter of 1999.
<PAGE> 3
Inflation did not have any material impact on operations during the
first quarter of 1999 and it is not expected to materially impact future
operations.
To facilitate the possible sale of parcels, the Partnership may be
required to 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 so that the clearing for the road was
done at no expense to the Partnership.
The Partnership has not determined to construct the stub road as of
this date.
Liquidity and Capital Resources
The Partnership has cash reserves of $65,964 at March 31, 1999, which
will be used to cover the following estimated annual costs: management fees
$8,100, accounting $12,500, legal $5,000, insurance $300, taxes $316, and other
administrative costs $6,500. In the General Partner's opinion, the Partnership's
reserves will be sufficient for an additional two years. However, if additional
expenses are incurred or should the Partnership decide to construct 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 changes in the Partnership's securities during the first
quarter of fiscal year 1999.
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.
<PAGE> 4
Item 4 - Submission of Matters to a Vote of Security Holders
No matters were submitted to the Partners for a vote during the first
quarter of 1999.
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)
<TABLE>
<CAPTION>
Exhibit Numbers Description Page Number
- --------------- ----------- -----------
<S> <C> <C>
27 Financial Data Schedule
</TABLE>
<PAGE> 5
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following person on behalf of the
Registrant and in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Richard W. Sorenson
- ------------------------- President, May 12, 1999
Richard W. Sorenson Southern Management ------------
Group, LLC
</TABLE>
<PAGE> 6
EXHIBIT A
SOUTHEAST ACQUISITIONS I, LP
BALANCE SHEETS
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1999 1998
ASSETS (UNAUDITED)
------------ ------------
<S> <C> <C>
LAND HELD FOR SALE $ 2,257,996 $ 2,257,996
CASH AND CASH EQUIVALENTS 65,964 80,029
PREPAID INSURANCE 227 --
----------- -----------
$ 2,324,187 $ 2,338,025
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $ 8,514 $ 13,477
PARTNERS' EQUITY:
GENERAL PARTNER (10,487) (10,417)
LIMITED PARTNERS (4,225 UNITS OUTSTANDING) 2,326,160 2,334,965
----------- -----------
2,315,673 2,324,548
----------- -----------
$ 2,324,187 $ 2,338,025
=========== ===========
</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
ENDED MARCH 31
REVENUES: 1999 1998
---- ----
<S> <C> <C>
GAIN ON SALE OF LAND $ -- $ 122,887
INTEREST INCOME 551 1,179
----------- -----------
551 124,066
----------- -----------
EXPENSES:
GENERAL AND ADMINISTRATIVE 5,153 8,398
MANAGEMENT FEE 2,025 2,025
REAL ESTATE TAXES 79 73
INSURANCE 76 81
DELAWARE FRANCHISE AND EXCISE TAX 230 --
----------- -----------
7,563 10,577
----------- -----------
NET (LOSS) INCOME (7,012) 113,489
PARTNERS' EQUITY,
BEGINNING OF PERIOD 2,324,547 2,543,392
----------- -----------
CAPITAL DISTRIBUTION (1,862) --
PARTNERS' EQUITY,
END OF PERIOD $ 2,315,673 $ 2,656,881
=========== ===========
WEIGHTED AVERAGE NUMBER
OF LIMITED PARTNERSHIP
UNITS OUTSTANDING 4,225 4,225
=========== ===========
INCOME (LOSS) FROM OPERATIONS
PER LIMITED PARTNERSHIP
INTEREST $ (1.64) $ 26.59
=========== ===========
</TABLE>
<PAGE> 8
EXHIBIT A
SOUTHEAST ACQUISITIONS I, LP
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31
----------------------------
1999 1998
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
PROCEEDS FROM SALE OF LAND $ -- $ 333,194
INTEREST INCOME RECEIVED 551 1,179
OTHER INCOME RECEIVED -- --
CASH PAID FOR OPERATING EXPENSES (12,754) (19,641)
---------- -------------
NET CASH (USED IN) PROVIDED BY
OPERATING ACTIVITIES (12,203) 314,732
CASH FLOWS FROM FINANCING ACTIVITIES:
DISTRIBUTION TO LIMITED PARTNERS 1,862 --
---------- -------------
(DECREASE) INCREASE IN CASH (14,065) 314,732
CASH, BEGINNING OF PERIOD 80,029 41,131
---------- -------------
CASH, END OF PERIOD $ 65,964 $ 355,863
========== =============
RECONCILIATION OF NET (LOSS) INCOME TO NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES:
NET (LOSS) INCOME $ (7,012) $ 113,489
ADJUSTMENTS TO RECONCILE NET (LOSS) INCOME
TO NET CASH (USED IN) PROVIDED BY
OPERATING ACTIVITIES:
GAIN ON SALE OF LAND -- (122,887.00)
NET PROCEEDS FROM SALE OF LAND -- 333,194.00
DECREASE IN ACCOUNTS PAYABLE AND ACCRUED EXPENSES (4,964) (8,819)
INCREASE IN PREPAID EXPENSES (227) (245)
--------- -------------
NET CASH (USED IN) PROVIDED BY OPERATING
ACTIVITIES $ (12,203) $ 314,732
========= =============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE> 9
SOUTHEAST ACQUISITIONS I, LP
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For the Three Months Ended March 31, 1999
(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, 1998. 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 three-month period ended March 31, 1999 may not be
indicative of the results that may be expected for the year ending December
31, 1999.
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 three months were as follows:
<TABLE>
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
Management Fees $2,025 $2,025
Accounting Fees -- --
Transfer Fees $ 25 $ 400
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF SOUTHEAST ACQUISITIONS I, L.P. FOR THE THREE MONTHS
ENDED MARCH 31, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 65,964
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 227
<PP&E> 2,257,996
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,324,187
<CURRENT-LIABILITIES> 8,514
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,315,673
<TOTAL-LIABILITY-AND-EQUITY> 2,324,187
<SALES> 0
<TOTAL-REVENUES> 551
<CGS> 0
<TOTAL-COSTS> 7,563
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (7,012)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,012)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,012)
<EPS-PRIMARY> (1.64)
<EPS-DILUTED> (1.64)
</TABLE>
