<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from December 31, 1999 to March 31, 2000
Commission File Number 0-18528
INCOME GROWTH PARTNERS, LTD. X
(Exact name of registrant as specified in its charter)
CALIFORNIA 33-0294177
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11300 Sorrento Valley Road, Suite 108, San Diego, California 92121
(Address of principal executive offices) (Zip Code)
(619) 457-2750
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registration (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
filing requirements for the past 90 days. Yes [X] No [ ]
The number of the registrant's Original Limited Partnership Units outstanding as
of May 14, 1999 was 18,826.5. The number of the registrant's Class A Units
outstanding as of May 14, 1999 was 8,100.
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
<PAGE> 3
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
March 31 December 31,
2000 1999
<S> <C> <C>
ASSETS
Rental properties
Land $ 7,078,365 $ 7,078,365
Buildings and improvements 21,987,832 21,907,461
------------ ------------
29,066,197 28,985,826
Less accumulated depreciation (10,534,395) (10,316,949)
------------ ------------
18,531,802 18,668,877
Cash and cash equivalents 369,164 434,712
Deferred loan fees, net of accumulated amortization
of $201,398 and $188,166, respectively 575,785 589,017
Prepaids and other assets 258,850 125,864
------------ ------------
$ 19,735,601 $ 19,818,470
============ ============
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Mortgage loans payable $ 19,363,466 $ 19,382,900
Other liabilities
Loan payable to affiliates 46,040 48,540
Accounts payable and accrued liabilities 177,987 172,559
Accrued interest payable 125,699 120,684
Security deposits 225,802 217,757
------------ ------------
19,938,994 19,942,440
Commitments and contingencies
Partners' capital (deficit) (193,393) (113,970)
Note receivable from general partner (10,000) (10,000)
------------ ------------
$ 19,735,601 $ 19,818,470
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE> 4
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
2000 1999
<S> <C> <C>
REVENUES
Rents $ 1,137,590 $ 1,033,563
Other 50,896 57,063
----------- -----------
Total revenues 1,188,486 1,090,627
----------- -----------
EXPENSES
Operating expenses 498,494 535,123
Depreciation and amortization 230,680 231,798
Interest 391,025 379,292
----------- -----------
Total expenses 1,120,199 1,146,213
----------- -----------
Net income (loss) $ 68,287 $ (55,586)
=========== ===========
BASIC AND DILUTED PER LIMITED PARTNERSHIP UNIT DATA
Net income (loss) per limited partnership unit $ 2.54 $ (2.06)
=========== ===========
Weighted average limited partnership units 26,926 26,926
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE> 5
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
2000 1999
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 68,287 $ (55,586)
Adjustments to reconcile net loss to net cash provided by
operating activities
Depreciation and amortization 230,680 231,798
(Increase) in
Prepaid expenses and other assets (255,488) 2,076
Deferred loan fees 122,500 --
Increase in
Accounts payable, accrued liabilities and accrued
interest payable 10,443 72,762
Security deposits 8,045 2,900
--------- ---------
Net cash provided by operating activities 184,467 252,951
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (80,371) (39,637)
--------- ---------
Net cash used in investing activities (80,371) (39,637)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments under mortgage debt (19,434) (44,463)
Principal payments to affiliate (2,500) --
Distributions to Investors (147,710) (78,842)
--------- ---------
Net cash used by financing activities (169,644) (123,305)
--------- ---------
Net increase (decrease) in cash and cash equivalents (65,548) 90,009
--------- ---------
Cash and cash equivalents at beginning of period 434,712 441,909
--------- ---------
Cash and cash equivalents at end of period $ 369,164 $ 531,918
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE> 6
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
1. BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying unaudited consolidated financial statements of Income
Growth Partners, Ltd. X, a California limited partnership, and
subsidiary (the "Partnership") have been prepared pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain
information and note disclosures normally included in annual financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to those rules and
regulations, although the Partnership believes that the disclosures made
are adequate to make the information presented not misleading. These
consolidated financial statements should be read in conjunction with the
financial statements and the notes thereto included in the Partnership's
latest audited financial statements for the year ended December 31, 1999
filed on Form 10K.
The accompanying consolidated financial statements have not been audited
by independent public accountants, but include all adjustments
(consisting of normal recurring adjustments) which are, in the opinion
of the general partners, necessary for a fair presentation of the
financial condition, results of operations and cash flows for the
periods presented. However, these results are not necessarily indicative
of results for a full year.
Certain prior period amounts have been reclassified to conform with the
current period presentation.
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<PAGE> 7
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following Management's Discussion and Analysis of Financial
Condition and Results of Operations should be read in conjunction
with the financial statements and notes thereto filed herewith.
a. Liquidity and Capital Resources:
Since inception, the Partnership's operating and debt service
obligations have been financed through the sale of Partnership
Units, cash provided by operating activities, and 1995 debt
restructuring activities. During the three months ended March
31, 2000, all of the Partnership's operating and debt service
cash requirements have been met through cash generated from
operations.
The Mission Park mortgage was refinanced in December 1995 at a
fixed interest rate of 7.76%. The Shadowridge Meadows mortgage
was refinanced in October 1997 at a fixed interest rate of
7.49%.
In the event that one or more of the properties is unable to
support its debt service and the Partnership is unable to cover
operational shortfalls from cash reserves, the Partnership may
have to take one or more alternative courses of action. The
general partners would then determine, based on their analysis
of relevant economic conditions and the status of the
properties, a course of action intended to be consistent with
the best interests of the Partnership. Possible courses of
action might include the sacrifice, sale or refinancing of one
or more of the properties, the entry into one or more joint
venture partnerships with other entities, or the filing of
another bankruptcy petition.
Net cash provided by operating activities for the three months
ended March 31, 2000 was approximately $184,467 compared to
approximately $253,951 for the same period in 1999. The
principal reason for this decrease can be attributed to cash
payments made for impound accounts.
Net cash used in investing activities for the three months ended
March 31, 2000 was approximately $80,371 compared to
approximately $39,637 for the same period in 1999. The principal
reason for this increase was an increase in capital
expenditures.
Net cash used in financing activities for the three months ended
March 31, 2000 was approximately $169,644 compared to
approximately $123,305 for the same period in 1999. The
principal reason for this increase was an increase in
distributions to investors.
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<PAGE> 8
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
b. Results of Operations:
COMPARISON OF THREE MONTHS ENDED MARCH 31, 2000 TO THE THREE
MONTHS ENDED MARCH 31, 1999.
Rental revenue for the three months ended March 31, 2000 was
approximately $1,137,590, an increase of 10% over rents of
approximately $1,033,563 for the comparable period in 1999. The
increase is primarily attributable to an increase in monthly
tenant rental rates and steady average occupancy rates.
Operating expenses for the three months ended March 31, 2000
were approximately $498,494, a decrease of 7% over operating
expenses of approximately $535,123 for the comparable period in
1999. The decrease is primarily attributable to a decrease in
administration expenses.
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<PAGE> 9
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS:
There are no pending legal proceedings which may have a material
adverse effect on the Partnership. However, the Partnership is
involved in small claims court proceedings against certain present or
former tenants of its apartment complexes with regard to
landlord-tenant matters, all of which are considered to be in the
ordinary course of its business.
ITEM 2. CHANGES IN SECURITIES:
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES:
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
None
ITEM 5. OTHER INFORMATION:
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:
None
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<PAGE> 10
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARY
A CALIFORNIA LIMITED PARTNERSHIP
- --------------------------------------------------------------------------------
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 12, 2000
INCOME GROWTH PARTNERS, LTD. X,
a California Limited Partnership
By: Income Growth Management, Inc.
General Partner
By: /s/ Timothy C. Maurer
------------------------------------
Timothy C. Maurer
Principal Financial Officer AND
Duly Authorized Officer of the Registrant
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 369,164
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 834,635
<PP&E> 29,066,197
<DEPRECIATION> (10,534,395)
<TOTAL-ASSETS> 19,735,601
<CURRENT-LIABILITIES> 575,528
<BONDS> 19,363,466
0
0
<COMMON> 0
<OTHER-SE> (203,393)
<TOTAL-LIABILITY-AND-EQUITY> 19,735,601
<SALES> 0
<TOTAL-REVENUES> 1,188,486
<CGS> 0
<TOTAL-COSTS> 498,494
<OTHER-EXPENSES> 230,680
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 391,025
<INCOME-PRETAX> 68,287
<INCOME-TAX> 0
<INCOME-CONTINUING> 68,287
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 68,287
<EPS-BASIC> 2.54
<EPS-DILUTED> 2.54
</TABLE>
