<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A NO. 1
AMENDMENT TO
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): February 3, 1997
IEA INCOME FUND XI, L.P.
(Exact name of registrant as specified in its charter)
California 0-19770 94-3122430
(State or other jurisdiction (IRS Employer
of incorporation or organization) (Commission File No.) Identification No.)
444 Market Street, 15th Floor, San Francisco, California 94111
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (415) 677-8990
<PAGE> 2
Item 4. Changes in Registrant's Certifying Accountant.
(a) On February 3, 1997, Arthur Andersen, London,
England, resigned as auditors of The Cronos Group, a Luxembourg corporation
headquartered in Orchard Lea, England (the "Parent Company") (NASDAQ -- CRNSF).
The Parent Company is the indirect corporate parent of Cronos Capital Corp.,
the Managing General Partner of the Registrant. In its letter of resignation,
Arthur Andersen states that it was unable to obtain adequate information in
response to inquiries it had made in connection with its audit of the Parent
Company for the year ended December 31, 1996. In connection with its
resignation, Arthur Andersen also prepared a report pursuant to the provisions
of Section 10A(b)(2) of the Securities Exchange Act of 1934, as amended, for
filing by the Parent Company with the SEC. In this report, Arthur Andersen
explains, based upon the information it then had available, that:
(i) A disbursement of $1.5 million by the Parent
Company and subsequent correspondence from the Parent Company's bank concerning
the repayment of the disbursement to the Parent Company may have violated laws
and regulations to which the Parent Company is subject, including U.S.
securities laws, and that these matters may have a material effect upon the
1996 financial statements of the Parent Company;
(ii) Senior management of the Parent Company had
not taken, and the Board of Directors of the Parent Company had not caused
senior management to take, timely and appropriate remedial actions with respect
to these matters; and
(iii) The circumstances of these matters and
failure to take remedial action warranted Arthur Andersen's resignation as
outside auditors of the Parent Company.
The Arthur Andersen report appears to constitute a "reportable
event" pursuant to Item 304 of Regulation S-K in that the report appears to
constitute advice to the management of The Cronos Group that information has
come to the attention of Arthur Andersen that has made it unwilling to be
associated with the financial statements prepared by the management of The
Cronos Group.
In its letter of resignation to the Parent Company, Arthur
Andersen states that it is resigning as auditors of the Parent Company and of
all other entities affiliated with the Parent Company. While its letter of
resignation is not addressed to the General Partner or the Registrant, Arthur
Andersen has confirmed to the General Partner that its resignation as auditors
of the entities referred to in its letter of resignation includes its
resignation as auditors of Cronos Capital Corp. and the Registrant.
The General Partner also understands that the three outside
directors on the Parent Company's six-member Board of Directors have resigned.
<PAGE> 3
The Registrant does not, at this time, have sufficient
information to respond to the concerns raised by Arthur Andersen with respect
to its 1996 audit of the Parent Company. However, the General Partner of
the Registrant does not believe, based upon the information currently
available to it, that Arthur Andersen's resignation was triggered by any
concern over the accounting policies and procedures followed by the Registrant.
Arthur Andersen's report on the financial statements of Cronos
Capital Corp. and the Registrant, for either of the past two years, has not
contained an adverse opinion or a disclaimer of opinion, nor was any such
report qualified or modified as to uncertainty, audit scope, or accounting
principles.
During the Registrant's two most recent fiscal years and the
subsequent interim period preceding Arthur Andersen's resignation, there have
been no disagreements between Cronos Capital Corp. or the Registrant and Arthur
Andersen on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure.
(b) The Registrant has yet to retain a new auditor.
Item 5. Other Events.
See Item 4 above.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired. Not
applicable.
(b) Pro forma financial information. Not applicable.
(c) Exhibits.
16.1 Letter of resignation from Arthur Andersen to
the Board of Directors of the Cronos Group,
dated February 3, 1997.
16.2 Report of Arthur Andersen pursuant to Section
10A(b)(2) of the Securities Exchange Act of
1934, as amended, dated February 3, 1997,
addressed to the Board of Directors of the
Cronos Group.
16.3 Arthur Andersen's confirmation of its
resignation as auditor of the Registrant,
dated February 6, 1997.
16.4 Letter from Arthur Andersen to the Office of
Chief Accountant, Securities and Exchange
Commission, dated February 21, 1997, stating
agreement with the statements contained in
this current report.
<PAGE> 4
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 hereunto duly authorized.
IEA INCOME FUND XI, L.P.
By: CRONOS CAPITAL CORP.
The General Partner
By: /s/ DENNIS J. TIETZ
--------------------------------
Dennis J. Tietz
President
Date: February 24, 1997
<PAGE> 5
EXHIBIT INDEX
Exhibit Method of
No. Description Filing
- -------- ----------- -------------
16.1 Letter of resignation from Arthur Andersen to the Filed with
Board of Directors of the Cronos Group, dated this document
February 3, 1997.
16.2 Report of Arthur Andersen pursuant to Section Filed with
10A(b)(2) of the Securities Exchange Act of 1934, this document
as amended, dated February 3, 1997, addressed to
the Board of Directors of the Cronos Group.
16.3 Arthur Andersen's confirmation of its resignation Filed with
as auditor of the Registrant, dated February 6, this document
1997.
16.4 Letter from Arthur Andersen to the Office of Chief Filed with
Accountant, Securities and Exchange Commission, this document
dated February 21, 1997, stating agreement with the
statements contained in this current report.
<PAGE> 1
EXHIBIT 16.1
ARTHUR
ANDERSEN
-----------------------
1 Surrey Street
London WC2R 2PS
0171 438 3000 Telephone
0171 831 1133 Facsimile
3 February 1997
The Board of Directors
The Cronos Group
35 Rue Glesener
L-1631 Luxembourg
Dear Sirs:
We have concluded that we have not received a satisfactory response from the
Board to our letters of 9 January 1997, 16 January 1997, and 24 January 1997.
The "collective response from the Board" contained in the letter to us dated 28
January 1997 and signed by Mr. Eriksen on behalf of himself and Mr. Palatin did
not appropriately address or explain the issues and inconsistencies which were
set out in our letters. We were subsequently informed by Mr. Palatin in a
telephone conversation on 31 January 1997 that no further explanations would be
forthcoming or investigations undertaken.
Since we have been, and continue to be, unable to obtain the information and
explanations we require for the purposes of our 31 December 1996 audit of the
Group, the circumstances no longer exist in which we will be able to perform
such an audit in accordance with generally accepted auditing standards.
Further, as we informed you in our previous letters, we are now obliged to
submit a report to you pursuant to our obligations under Section 10A(b)(2) of
the United Stated Securities Exchange Act of 1934, as amended by Title III of
the United States Private Securities Litigation Reform Act of 1995.
Accordingly:
1 We hereby resign with immediate effect as auditors of the consolidated
Cronos Group and of its holding company, The Cronos Group societe
anonyme, and of all other entities within the Cronos Group.
2 We enclose the report referred to above arising from our
responsibilities under US Federal securities laws. The Board is
required to notify the United States Securities and Exchange Commission
of the receipt and contents of this report, together with certain other
specified information, not later than one business day after the report
has been received and to provide us with a copy of such notice. We
assume that the Board will be taking US legal advise as to the
fulfilment of its reporting obligation.
Yours faithfully
ARTHUR ANDERSEN
<PAGE> 1
EXHIBIT 16.2
ARTHUR
ANDERSEN
-----------------------
PO Box 55
1 Surrey Street
London WC2R 2NT
0171 438 3000 Telephone
0171 831 1133 Facsimile
Direct line 0171 438 3120
3 February 1997
The Board of Directors
The Cronos Group
35 Rue Glesener
L-1631 Luxembourg
PRIVATE AND CONFIDENTIAL
Dear Sirs
RE: Report Required by Section 10A(b)(2) of the United States Securities
Exchange Act of 1934, as Amended by Title III of the United States
Private Securities Litigation Reform Act of 1995
We are submitting this report to you in response to our obligations under
Section 10A(b)(2), of the US Securities Exchange Act of 1934, as amended by
Title III of the US Private Securities Litigation Reform Act of 1995.
We refer to our letter of 24 January 1997 to the Board concerning certain
matters which have come to our attention during the course of our audit at 31
December 1996, and for which we have been unable to obtain satisfactory
explanation and support. In our letter of 24 January 1997, we stated that we
require a response from the Board on the matters referred to in our letters of
9 January 1997 and 16 January 1997, by 5pm on Tuesday, 28 January 1997 (London
time). We have considered the information received and conclude that we have
not received a response that appropriately addresses the matters cited in those
communications. Accordingly, as we previously informed you, we are required by
US Federal securities laws to submit this report to you.
We have concluded, based on the information we have as of the date of this
letter, that
(a) The disbursement of US $1.5 million and the subsequent correspondence
from National Westminster Bank concerning repayment of that disbursement
(copies of which you have previously received) may have violated laws
and regulations to which Cronos is subject, including US Federal
securities laws, and that these matters may have a material effect on
the 1996 financial statements of Cronos.
(b) Senior management has not taken, and the Board of Directors has not
caused senior management to take, timely and appropriate remedial
actions with respect to these matters; and
<PAGE> 2
[ARTHUR ANDERSEN LETTERHEAD]
-2-
The Board of Directors 3 February 1997
(c) The circumstances of these matters and failure to take remedial action
warrants our resignation from the engagement and we have so resigned.
By receipt of this report, we hereby advise you that under Section 10A(b)(3) of
the Securities Exchange Act of 1934, the Board is required to inform the US
Securities and Exchange Commission by notice not later than one business day
after receipt of this report that this report has been received, and provide us
with a copy of such notice.
Under Section 10A(b)(3), if we do not receive a copy of the notice referred to
above by close of business UK time on 4 February 1997 we are required to, and
will furnish a copy of this report to the SEC within one business day
following failure to receive notice.
Yours faithfully
/s/ Arthur Andersen
- ----------------------
<PAGE> 1
EXHIBIT 16.3
ARTHUR
ANDERSEN
February 6, 1997
Mr. Dennis Tietz, President
Cronos Capital Corp.
444 Market Street, 15th floor
San Francisco, California 94111
Dear Dennis:
This is to confirm that the client-auditor relationship between the following
entities and Arthur Andersen LLP has ceased.
IEA Marine Container Fund I
IEA Marine Container Fund II
IEA Marine Container Income Fund III
IEA Marine Container Income Fund IV
IEA Marine Container Income Fund V (A)
IEA Marine Container Income Fund V (B)
IEA Income Fund VI
IEA Income Fund VII
IEA Income Fund VIII
IEA Income Fund IX
IEA Income Fund X
IEA Income Fund XI
IEA Income Fund XII
Cronos Global Income Fund XIV, L.P.
Cronos Global Income Fund XV, L.P.
Cronos Global Income Fund XVI, L.P.
Very truly yours,
[SIG]
ARTHUR ANDERSEN LLP
Copy to: Office of Chief Accountant
Securities and Exchange Commission
<PAGE> 1
EXHIBIT 16.4
ARTHUR
ANDERSEN
February 21, 1997
Office of Chief Accountant
Securities and Exchange Commission
Washington, D.C.
Gentlemen:
We have read Item 4 included in the Form 8-K's, as amended on February 24, 1997
by the filings in which this letter is included, filed with the Securities and
Exchange Commission for the following registrants, and are in agreement with
the statements contained therein:
IEA Marine Container Fund I
IEA Marine Container Fund II
IEA Marine Container Income Fund III
IEA Marine Container Income Fund IV
IEA Marine Container Income Fund V (A)
IEA Marine Container Income Fund V (B)
IEA Income Fund VI
IEA Income Fund VII
IEA Income Fund VIII
IEA Income Fund IX
IEA Income Fund X
IEA Income Fund XI
IEA Income Fund XII
Cronos Global Income Fund XIV, L.P.
Cronos Global Income Fund XV, L.P.
Cronos Global Income Fund XVI, L.P.
Very truly yours,
/s/ ARTHUR ANDERSEN LLP
