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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 June 30, 1999
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 number 0-18997
SOUTHWEST ROYALTIES INSTITUTIONAL 1990-91 INCOME PROGRAM
Southwest Royalties Institutional Income Fund X-A, L.P.
(Exact name of registrant as specified
in its limited partnership agreement)
Delaware 75-2310852
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
407 N. Big Spring, Suite 300
Midland, Texas 79701
(Address of principal executive offices)
(915) 686-9927
(Registrant's telephone number,
including area code)
Indicate by check mark whether 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 (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
The total number of pages contained in this report is 17.
<PAGE>
PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
The unaudited condensed financial statements included herein have been
prepared by the Registrant (herein also referred to as the "Partnership")
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all
adjustments necessary for a fair presentation have been included and are of
a normal recurring nature. The financial statements should be read in
conjunction with the audited financial statements and the notes thereto for
the year ended December 31, 1998 which are found in the Registrant's Form
10-K Report for 1998 filed with the Securities and Exchange Commission.
The December 31, 1998 balance sheet included herein has been taken from the
Registrant's 1998 Form 10-K Report. Operating results for the three and
six month periods ended June 30, 1999 are not necessarily indicative of the
results that may be expected for the full year.
<PAGE>
Southwest Royalties Institutional Income Fund X-A, L.P.
Balance Sheets
June 30, December 31,
1999 1998
--------- ------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 928 10,631
Receivable from Managing General Partner 26,063 -
--------- ---------
Total current assets 26,991 10,631
--------- ---------
Oil and gas properties - using the
full cost method of accounting 4,240,360 4,284,356
Less accumulated depreciation,
depletion and amortization 4,045,143 4,033,143
--------- ---------
Net oil and gas properties 195,217 251,213
--------- ---------
$ 222,208 261,844
========= =========
Liabilities and Partners' Equity
Current liabilities
Distributions payable $ 428 290
Payable to Managing General Partner - 18,078
--------- ---------
Total current liabilities 428 18,368
--------- ---------
Partners' equity:
General partners (23,461) (22,491)
Limited partners 245,241 265,967
--------- ---------
Total partners' equity 221,780 243,476
--------- ---------
$ 222,208 261,844
========= =========
<PAGE>
Southwest Royalties Institutional Income Fund X-A, L.P.
Statements of Operations
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
Revenues
Income (loss) from net profits
interests $ 38,079 (4,613) 39,523 17,323
Interest - 15 - 104
------- ------- ------- -------
38,079 (4,598) 39,523 17,427
------- ------- ------- -------
Expenses
General and administrative 24,672 26,155 49,219 57,355
Depreciation, depletion and
amortization 5,000 19,000 12,000 37,000
------- ------- ------- -------
29,672 45,155 61,219 94,355
------- ------- ------- -------
Net income (loss) $ 8,407 (49,753) (21,696) (76,928)
======= ======= ======= =======
Net income (loss) allocated to:
Managing General Partner $ 1,207 (2,768) (873) (3,594)
======= ======= ======= =======
General Partner $ 134 (307) (97) (399)
======= ======= ======= =======
Limited partners $ 7,066 (46,678) (20,726) (72,935)
======= ======= ======= =======
Per limited partner unit $ .62 (4.12) (1.83) (6.45)
======= ======= ======= =======
<PAGE>
Southwest Royalties Institutional Income Fund X-A, L.P.
Statements of Cash Flows
(unaudited)
Six Months Ended
June 30,
1999 1998
Cash flows from operating activities:
Cash received from income from net profits
interests $ (10,335) 63,666
Cash paid to suppliers (43,502) (47,438)
Interest received - 104
------- -------
Net cash provided by (used in) operating activities (53,837) 16,332
------- -------
Cash flows provided by investing activities:
Cash received from sale of oil and gas
properties 44,002 45,000
Additions to oil and gas properties (6) -
------- -------
Net cash provided by investing activities 43,996 45,000
------- -------
Cash flows used in financing activities:
Distributions to partners 138 (29,924)
------- -------
Net increase (decrease) in cash and cash equivalents (9,703) 31,408
Beginning of period 10,631 6,301
------- -------
End of period $ 928 37,709
======= =======
(continued)
<PAGE>
Southwest Royalties Institutional Income Fund X-A, L.P.
Statements of Cash Flows, continued
(unaudited)
Six Months Ended
June 30,
1999 1998
Reconciliation of net income (loss) to net
cash provided by (used in) operating activities:
Net income (loss) $ (21,696) (76,928)
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating activities:
Depreciation, depletion and amortization 12,000 37,000
Decrease (increase) in receivables (49,858) 46,343
Increase in payables 5,717 9,917
------- -------
Net cash provided by (used in) operating activities $ (53,837) 16,332
======= =======
<PAGE>
Southwest Royalties Institutional Income Fund X-A, L.P.
(a Delaware limited partnership)
Notes to Financial Statements
1. Organization
Southwest Royalties Institutional Income Fund X-A, L.P. was organized
under the laws of the state of Delaware on January 29, 1990, for the
purpose of acquiring producing oil and gas properties and to produce
and market crude oil and natural gas produced from such properties
for a term of 50 years, unless terminated at an earlier date as
provided for in the Partnership Agreement. The Partnership sells its
oil and gas production to a variety of purchasers with the prices it
receives being dependent upon the oil and gas economy. Southwest
Royalties, Inc. serves as the Managing General Partner and H. H.
Wommack, III, as the individual general partner. Revenues, costs and
expenses are allocated as follows:
Limited General
Partners Partners
-------- --------
Interest income on capital contributions 100% -
Oil and gas sales 90% 10%
All other revenues 90% 10%
Organization and offering costs (1) 100% -
Amortization of organization costs 100% -
Property acquisition costs 100% -
Gain/loss on property disposition 90% 10%
Operating and administrative costs (2) 90% 10%
Depreciation, depletion and amortization
of oil and gas properties 100% -
All other costs 90% 10%
(1) All organization costs in excess of 3% of initial capital
contributions will be paid by the Managing General Partner and
will be treated as a capital contribution. The Partnership paid
the Managing General Partner an amount equal to 3% of initial
capital contributions for such organization costs.
(2) Administrative costs in any year which exceed 2% of capital
contributions shall be paid by the Managing General Partner and
will be treated as a capital contribution.
2. Summary of Significant Accounting Policies
The interim financial information as of June 30, 1999, and for the
three and six months ended June 30, 1999, is unaudited. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted in this Form 10-Q pursuant
to the rules and regulations of the Securities and Exchange
Commission. However, in the opinion of management, these interim
financial statements include all the necessary adjustments to fairly
present the results of the interim periods and all such adjustments
are of a normal recurring nature. The interim consolidated financial
statements should be read in conjunction with the audited financial
statements for the year ended December 31, 1998.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
General
Southwest Royalties Institutional Income Fund X-A, L.P. was organized as a
Delaware limited partnership on January 29, 1990. The offering of such
limited partnership interests began May 11, 1990 as part of a shelf
offering registered under the name Southwest Royalties Institutional 1990-
91 Income Program. Minimum capital requirements for the Partnership were
met on July 30, 1990, with the offering of limited partnership interests
concluding on November 30, 1990, with total limited partner contributions
of $5,658,000.
The Partnership was formed to acquire royalty and net profits interests in
producing oil and gas properties, to produce and market crude oil and
natural gas produced from such properties, and to distribute the net
proceeds from operations to the limited and general partners. Net revenues
from producing oil and gas properties will not be reinvested in other
revenue producing assets except to the extent that production facilities
and wells are improved or reworked or where methods are employed to improve
or enable more efficient recovery of oil and gas reserves.
Increases or decreases in Partnership revenues and, therefore,
distributions to partners will depend primarily on changes in the prices
received for production, changes in volumes of production sold, lease
operating expenses, enhanced recovery projects, offset drilling activities
pursuant to farmout arrangements, sales of properties, and the depletion of
wells. Since wells deplete over time, production can generally be expected
to decline from year to year.
Well operating costs and general and administrative costs usually decrease
with production declines; however, these costs may not decrease
proportionately. Net income available for distribution to the partners is
therefore expected to fluctuate in later years based on these factors.
Based on current conditions, management does not anticipate performing
workovers during the next two years. The Partnership could possibly
experience a normal decline of 8% to 10% per year.
Oil and Gas Properties
Oil and gas properties are accounted for at cost under the full-cost
method. Under this method, all productive and nonproductive costs incurred
in connection with the acquisition, exploration and development of oil and
gas reserves are capitalized. Gain or loss on the sale of oil and gas
properties is not recognized unless significant oil and gas reserves are
involved.
The Partnership's policy for depreciation, depletion and amortization of
oil and gas properties is computed under the units of revenue method.
Under the units of revenue method, depreciation, depletion and amortization
is computed on the basis of current gross revenues from production in
relation to future gross revenues, based on current prices, from estimated
production of proved oil and gas reserves.
Should the net capitalized costs exceed the estimated present value of oil
and gas reserves, discounted at 10%, such excess costs would be charged to
current expense. As of June 30, 1999, the net capitalized costs did not
exceed the estimated present value of oil and gas reserves. The oil price
environment experienced during 1998 had an adverse affect on the Company's
revenues and operating cash flow. Further declines of oil prices during
1999 could result in additional decreases in the carrying value of the
Company's oil and gas properties.
<PAGE>
Results of Operations
A. General Comparison of the Quarters Ended June 30, 1999 and 1998
The following table provides certain information regarding performance
factors for the quarters ended June 30, 1999 and 1998:
Three Months
Ended Percentage
June 30, Increase
1999 1998 (Decrease)
---- ---- ----------
Average price per barrel of oil $ 15.45 11.94 29%
Average price per mcf of gas $ 2.84 2.65 7%
Oil production in barrels 4,110 5,800 (29%)
Gas production in mcf 9,000 9,800 (8%)
Income from net profits interests $ 38,079 (4,613) 926%
Partnership distributions $ - 12,000 (100%)
Limited partner distributions $ - 10,800 (100%)
Per unit distribution to limited
partners $ - .95 (100%)
Number of limited partner units 11,316 11,316
Revenues
The Partnership's income from net profits interests increased to $38,079
from $(4,613) for the quarters ended June 30, 1999 and 1998, respectively,
an increase of 926%. The principal factors affecting the comparison of the
quarters ended June 30, 1999 and 1998 are as follows:
1. The average price for a barrel of oil received by the Partnership
increased during the quarter ended June 30, 1999 as compared to the
quarter ended June 30, 1998 by 29%, or $3.51 per barrel, resulting in
an increase of approximately $20,400 in income from net profits
interests. Oil sales represented 71% of total oil and gas sales during
the quarter ended June 30, 1999 as compared to 73% during the quarter
ended June 30, 1998.
The average price for an mcf of gas received by the Partnership
increased during the same period by 7%, or $.19 per mcf, resulting in
an increase of approximately $1,900 in income from net profits
interests.
The total increase in income from net profits interests due to the
change in prices received from oil and gas production is approximately
$22,300. The market price for oil and gas has been extremely volatile
over the past decade, and management expects a certain amount of
volatility to continue in the foreseeable future.
<PAGE>
2. Oil production decreased approximately 1,690 barrels or 29% during the
quarter ended June 30, 1999 as compared to the quarter ended June 30,
1998, resulting in a decrease of approximately $26,100 in income from
net profits interests.
Gas production decreased approximately 800 mcf or 8% during the same
period, resulting in a decrease of approximately $2,300 in income from
net profits interests.
The total decrease in income from net profits interests due to the
change in production is approximately $28,400. The decrease in oil
production is primarily due to property sales.
3. Lease operating costs and production taxes were 44% lower, or
approximately $43,600 less during the quarter ended June 30, 1999 as
compared to the quarter ended June 30, 1998. The decline in lease
operating costs is primarily in relation to the drop in oil prices
experienced throughout 1998 and into the first six months of 1999,
which made it uneconomical to perform workovers necessary to increase
production and perform major repairs thus making it necessary to shut-
in some wells.
Costs and Expenses
Total costs and expenses decreased to $29,672 from $45,155 for the quarters
ended June 30, 1999 and 1998, respectively, a decrease of 34%. The
decrease is the result of lower depletion expense and general and
administrative expense.
1. General and administrative costs consists of independent accounting and
engineering fees, computer services, postage, and Managing General
Partner personnel costs. General and administrative costs decreased 6%
or approximately $1,500 during the quarter ended June 30, 1999 as
compared to the quarter ended June 30, 1998.
2. Depletion expense decreased to $5,000 for the quarter ended June 30,
1999 from $19,000 for the same period in 1998. This represents a
decrease of 74%. Depletion is calculated using the units of revenue
method of amortization based on a percentage of current period gross
revenues to total future gross oil and gas revenues, as estimated by
the Partnership's independent petroleum consultants. Contributing
factors to the decline in depletion expense between the comparative
periods were the increase in the price of oil and gas used to determine
the Partnership's reserves for April 1, 1999 as compared to 1998 and
the decrease in gross oil and gas revenues.
<PAGE>
B. General Comparison of the Six Month Periods Ended June 30, 1999 and
1998
The following table provides certain information regarding performance
factors for the six month periods ended June 30, 1999 and 1998:
Six Months
Ended Percentage
June 30, Increase
1999 1998 (Decrease)
---- ---- ----------
Average price per barrel of oil $ 12.72 12.70 -
Average price per mcf of gas $ 2.21 2.24 (1%)
Oil production in barrels 8,900 13,200 (33%)
Gas production in mcf 18,300 20,700 (12%)
Income from net profits interests $ 39,523 17,323 128%
Partnership distributions $ - 30,000 (100%)
Limited partner distributions $ - 27,000 (100%)
Per unit distribution to limited
partners $ - 2.39 (100%)
Number of limited partner units 11,316 11,316
Revenues
The Partnership's income from net profits interests increased to $39,523
from $17,323 for the six months ended June 30, 1999 and 1998, respectively,
an increase of 128%. The principal factors affecting the comparison of the
six months ended June 30, 1999 and 1998 are as follows:
1. The average price for a barrel of oil received by the Partnership
increased during the six months ended June 30, 1999 as compared to the
six months ended June 30, 1998 by less than 1%, or $.02 per barrel,
resulting in an increase of approximately $300 in income from net
profits interests. Oil sales represented 74% of total oil and gas
sales during the six months ended June 30, 1999 as compared to 78%
during the six months ended June 30, 1998.
The average price for an mcf of gas received by the Partnership
decreased during the same period by 1%, or $.03 per mcf, resulting in a
decrease of approximately $600 in income from net profits interests.
The net total decrease in income from net profits interests due to the
change in prices received from oil and gas production is approximately
$300. The market price for oil and gas has been extremely volatile
over the past decade, and management expects a certain amount of
volatility to continue in the foreseeable future.
<PAGE>
2. Oil production decreased approximately 4,300 barrels or 33% during the
six months ended June 30, 1999 as compared to the six months ended June
30, 1998, resulting in a decrease of approximately $54,700 in income
from net profits interests.
Gas production decreased approximately 2,400 mcf or 12% during the same
period, resulting in a decrease of approximately $5,300 in income from
net profits interests.
The total decrease in income from net profits interests due to the
change in production is approximately $60,000. The decrease in oil
production is primarily due to property sales.
3. Lease operating costs and production taxes were 42% lower, or
approximately $82,600 less during the six months ended June 30, 1999 as
compared to the six months ended June 30, 1998. The decline in lease
operating costs is primarily in relation to the drop in oil prices
experienced throughout 1998 and into the first six months of 1999,
which made it uneconomical to perform workovers necessary to increase
production and perform major repairs thus making it necessary to shut-
in some wells.
Costs and Expenses
Total costs and expenses decreased to $61,219 from $94,355 for the six
months ended June 30, 1999 and 1998, respectively, a decrease of 35%. The
decrease is the result of lower general and administrative expense and
depletion expense.
1. General and administrative costs consists of independent accounting and
engineering fees, computer services, postage, and Managing General
Partner personnel costs. General and administrative costs decreased
14% or approximately $8,100 during the six months ended June 30, 1999
as compared to the six months ended June 30, 1998. The decrease of
general and administrative costs were in part due to additional
accounting costs incurred in 1998 in relation to the outsourcing of K-1
tax package preparation; a change in auditors requiring opinions from
both the predecessors and successor auditors and a new accounting
pronouncement requiring review by the independent auditors of the 10-
Q's. The Managing General Partner has also made an effort to cut back
on general and administrative costs whenever and wherever possible.
2. Depletion expense decreased to $12,000 for the six months ended June
30, 1999 from $37,000 for the same period in 1998. This represents a
decrease of 68%. Depletion is calculated using the units of revenue
method of amortization based on a percentage of current period gross
revenues to total future gross oil and gas revenues, as estimated by
the Partnership's independent petroleum consultants. Contributing
factors to the decline in depletion expense between the comparative
periods were the increase in the price of oil and gas used to determine
the Partnership's reserves for April 1, 1999 as compared to 1998 and
the decrease in gross oil and gas revenues.
<PAGE>
Liquidity and Capital Resources
The primary source of cash is from operations, the receipt of income from
interests in oil and gas properties. The Partnership knows of no material
change, nor does it anticipate any such change.
Cash flows provided by or (used in) operating activities were approximately
$(53,800) in the six months ended June 30, 1999 as compared to
approximately $16,300 in the six months ended June 30, 1998. Cash flows
used in operating activities were for oil and gas operations.
Cash flows provided by investing activities were approximately $44,000 in
the six months ended June 30, 1999 as compared to approximately $45,000 in
the six months ended June 30, 1998. The source of the 1999 cash flows were
sale of oil and gas properties.
Cash flows used in financing activities were approximately $(100) in the
six months ended June 30, 1999 as compared to approximately $29,900 in the
six months ended June 30, 1998.
There were no distributions during the six months ended June 30, 1999.
Total distributions during the six months ended June 30, 1998 were $30,000
of which $27,000 was distributed to the limited partners and $3,000 to the
general partners. The per unit distribution to limited partners during the
six months ended June 30, 1998 was $2.39.
The sources for the 1998 distributions of $30,000 were oil and gas
operations of approximately $16,300 and the sale of oil and gas properties
of approximately $45,000.
Since inception of the Partnership, cumulative monthly cash distributions
of $3,033,122 have been made to the partners. As of June 30, 1999,
$2,778,161 or $245.51 per limited partner unit has been distributed to the
limited partners, representing a 49% return of the capital contributed.
As of June 30, 1999, the Partnership had approximately $26,600 in working
capital. The Managing General Partner knows of no unusual contractual
commitments and believes the revenues generated from operations are
adequate to meet the needs of the Partnership.
<PAGE>
Liquidity - Managing General Partner
The Managing General Partner has a highly leveraged capital structure with
over $21.0 million of interest payments due in 1999 on its debt
obligations. Due to severely depressed commodity prices, the Managing
General Partner is experiencing difficulty in generating sufficient cash
flow to meet its obligations and sustain its operations. The Managing
General Partner is currently in the process of renegotiating the terms of
its various obligations with its creditors and/or attempting to seek new
lenders or equity investors. Additionally, the Managing General Partner
would consider disposing of certain assets in order to meet its
obligations.
There can be no assurance that the Managing General Partner's debt
restructuring efforts will be successful or that the lenders will agree to
a course of action consistent with the Managing General Partners
requirements in restructuring the obligations. Even if such agreement is
reached, it may require approval of additional lenders, which is not
assured. Furthermore, there can be no assurance that the sales of assets
can be successfully accomplished on terms acceptable to the Managing
General Partner. Under current circumstances, the Managing General
Partner's ability to continue as a going concern depends upon its ability
to (1) successfully restructure its obligations or obtain additional
financing as may be required, (2) maintain compliance with all debt
covenants, (3) generate sufficient cash flow to meet its obligations on a
timely basis, and (4) achieve satisfactory levels of future earnings. If
the Managing General Partner is unsuccessful in its efforts, it may be
unable to meet its obligations making it necessary to undertake such other
actions as may be appropriate to preserve asset values.
Information Systems for the Year 2000
The Managing General Partner provides all data processing needs of the
Partnership. The Managing General Partner is continuing in its effort to
identify and assess its exposure to the potential Year 2000 software and
imbedded chip processing and date sensitivity issue. Through the Managing
General Partners data processing subsidiary, Midland Southwest Software,
Inc., the Managing General Partner proactively initiated a plan to identify
applicable hardware and software, assess impact and effect, estimate costs,
construct and implement corrective actions, and prepare contingency plans.
Identification & Assessment
The Managing General Partner currently believes it has identified the
internal and external software and hardware that may have date sensitivity
problems. Four critical systems and/or functions were identified: (1) the
proprietary software of the Partnership (OGAS) that is used for oil & gas
property management and financial accounting functions, (2) the DEC VAX/VMS
hardware and operating system, (3) various third-party application software
including lease economic analysis, fixed asset management, geological
applications, and payroll/human resource programs, and (4) External Agents.
The proprietary software of the Partnership is currently in process of
meeting compliance requirements with an estimated completion date of mid-
year 1999. Since this is an internally generated software package, the
Managing General Partner has estimated the cost to be approximately $25,000
by estimating the necessary man-hours. These modifications are being made
by internal staff and do not represent additional costs to the Partnership.
The Managing General Partner has not made contingency plans at this time
since the conversion is ahead of schedule and being handled by Managing
General Partner controlled internal programmers. Given the complexity of
the systems being modified, it is anticipated that some problems may arise,
but with an expected early completion date, the Managing General Partner
feels that adequate time is available to overcome unforeseen delays.
DEC has released a fully compliant version of its operating system that is
used by the Partnership on the DEC VAX system. It will be installed in
August 1999, the Managing General Partner believes that this will solve any
potential problems on the system.
<PAGE>
The Managing General Partner has identified various third-party software
that may have date sensitivity problems and is working with the vendors to
secure solutions as well as prepare contingency plans. After review and
evaluation of the vendor plans and status, the Managing General Partner
believes that the problems will be resolved prior to the year 2000 or the
alternate contingency plan will sufficiently and adequately remediate the
problem so that there is no material disruption to business functions.
The External Agents of the Partnership include suppliers, customers,
owners, vendors, banks, product purchasers including pipelines, and other
oil and gas property operators. The Managing General Partner is in the
process of identifying and communicating with each critical External Agent
about its plan and progress thereof in addressing the Year 2000 issue.
This process is on schedule and the Managing General Partner, at this time,
believes that there should be no material interference or disruption
associated with any of the critical External Agent's functions necessary to
the Partnership's business. The Managing General Partner estimates
completion of this audit by mid-year 1999 and believes that alternate plans
can be devised to circumvent any material problems arising from critical
External Agent noncompliance.
Cost
To date, the Managing General Partner has incurred only minimal internal
man-hour costs for identification, planning, and maintenance. The Managing
General Partner believes that the necessary additional costs will also be
minimal and most will fall under normal and general maintenance procedures
and updates. An accurate cost cannot be determined at this time, but it is
expected that the total cost to remediate all systems to be less than
$50,000.
Risks/Contingency
The failure to correct critical systems of the Partnership, or the failure
of a material business partner or External Agent to resolve critical Year
2000 issues could have a serious adverse impact on the ability of the
Partnership to continue operations and meet obligations. Based on the
Managing General Partner's evaluation and assessment to date, it is
believed that any interruption in operation will be minor and short-lived
and pose no material monetary loss, safety, or environmental risk to the
Partnership. However, until all assessment is complete, it is impossible
to accurately identify the risks, quantify potential impacts or establish a
final contingency plan. The Managing General Partner believes that its
assessment and contingency planning will be complete no later than mid-year
1999.
Worst Case Scenario
The Securities and Exchange Commission requires that public companies must
forecast the most reasonably likely worst case Year 2000 scenario, assuming
that the Managing General Partner's Year 2000 plan is not effective.
Analysis of the most reasonably likely worst case Year 2000 scenarios the
Partnership may face leads to contemplation of the following possibilities
which, though considered highly unlikely, must be included in any
consideration of worst cases: widespread failure of electrical, gas, and
similar supplies by utilities serving the Partnership; widespread
disruption of the services of communications common carriers; similar
disruption to means and modes of transportation for the Partnership and its
employees, contractors, suppliers, and customers; significant disruption to
the Partnership's ability to gain access to, and continue working in,
office buildings and other facilities; and the failure, of third-parties
systems, the effects of which would have a cumulative material adverse
impact on the Partnership's critical systems. The Partnership could
experience an inability by customers, traders, and others to pay, on a
timely basis or at all, obligations owed to the Partnership. Under these
circumstances, the adverse effect on the Partnership, and the diminution of
Partnership revenues, could be material, although not quantifiable at this
time.
<PAGE>
PART II. - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matter to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27 Financial Data Schedule
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the
quarter ended June 30, 1999.
<PAGE>
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.
SOUTHWEST ROYALTIES INSTITUTIONAL
INCOME FUND X-A, L.P.
a Delaware limited partnership
By: Southwest Royalties, Inc.
Managing General Partner
By: /s/ Bill E. Coggin
Bill E. Coggin, Vice
President
and Chief Financial Officer
Date: August 15, 1999
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Balance Sheet at June 30, 1999 (Unaudited) and the Statement of Operations
for the Six Months Ended June 30, 1999 (Unaudited) and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 928
<SECURITIES> 0
<RECEIVABLES> 26,063
<ALLOWANCES> 0
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0
0
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