SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of The Securities Exchange Act of 1934
For the Quarter Ended: June 30, 1996
Commission file number: 0-23778
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
(Exact Name of Small Business Issuer as Specified in its Charter)
State of Minnesota 41-1729121
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
(Address of Principal Executive Offices)
(612) 227-7333
(Issuer's telephone number)
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
Check whether the issuer (1) 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
Transitional Small Business Disclosure Format:
Yes No [X]
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
INDEX
PART I. Financial Information
Item 1. Balance Sheet as of June 30, 1996 and December 31, 1995
Statements for the Periods ended June 30, 1996 and 1995:
Income
Cash Flows
Changes in Partners' Capital
Notes to Financial Statements
Item 2. Management's Discussion and Analysis
PART II. Other Information
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
BALANCE SHEET
JUNE 30, 1996 AND DECEMBER 31, 1995
(Unaudited)
ASSETS
1996 1995
CURRENT ASSETS:
Cash and Cash Equivalents $ 878,970 $ 4,833,630
Receivables 46,014 13,671
----------- -----------
Total Current Assets 924,984 4,847,301
----------- -----------
INVESTMENTS IN REAL ESTATE:
Land 7,333,946 6,075,887
Buildings and Equipment 11,620,962 9,218,410
Construction Advances 1,215,483 880,088
Property Acquisition Costs 126,711 174,903
Accumulated Depreciation (534,202) (352,389)
----------- -----------
Net Investments in Real Estate 19,762,900 15,996,899
----------- -----------
Total Assets $20,687,884 $20,844,200
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Payable to AEI Fund Management, Inc. $ 32,340 $ 50,011
Distributions Payable 468,725 468,725
Unearned Rent 34,862 0
----------- -----------
Total Current Liabilities 535,927 518,736
----------- -----------
MINORITY INTEREST 879,829 789,000
PARTNERS' CAPITAL (DEFICIT):
General Partners (14,220) (11,576)
Limited Partners, $1,000 Unit value;
24,000 Units authorized and issued;
23,869 Units outstanding 19,286,348 19,548,040
----------- -----------
Total Partners' Capital 19,272,128 19,536,464
----------- -----------
Total Liabilities and Partners' Capital $20,687,884 $20,844,200
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
STATEMENT OF INCOME
FOR THE PERIODS ENDED JUNE 30
(Unaudited)
Second Quarter Ended Six Months Ended
6/30/96 6/30/95 6/30/96 6/30/95
INCOME:
Rent $ 520,041 $ 318,120 $ 949,016 $ 629,788
Investment Income 40,552 138,518 116,244 279,751
----------- ----------- ----------- -----------
Total Income 560,593 456,638 1,065,260 909,539
----------- ----------- ----------- -----------
EXPENSES:
Partnership Administration-
Affiliates 44,083 55,164 110,766 132,516
Partnership Administration
and Property Management-
Unrelated Parties 12,837 8,161 23,944 25,396
Depreciation 100,067 58,950 181,813 116,808
----------- ----------- ----------- -----------
Total Expenses 156,987 122,275 316,523 274,720
----------- ----------- ----------- -----------
OPERATING INCOME 403,606 334,363 748,737 634,819
MINORITY INTEREST IN
OPERATING INCOME (22,656) 0 (43,379) 0
----------- ----------- ----------- -----------
NET INCOME $ 380,950 $ 334,363 $ 705,358 $ 634,819
=========== =========== =========== ===========
NET INCOME ALLOCATED:
General Partners $ 3,809 $ 3,344 $ 7,053 $ 6,348
Limited Partners 377,141 331,019 698,305 628,471
----------- ----------- ----------- -----------
$ 380,950 $ 334,363 $ 705,358 $ 634,819
=========== =========== =========== ===========
NET INCOME PER
LIMITED PARTNERSHIP UNIT
(23,869, 24,000, 23,869,
and 23,631 weighted average
Units outstanding for the
periods, respectively) $ 15.80 $ 13.79 $ 29.26 $ 26.60
=========== =========== =========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED JUNE 30
(Unaudited)
1996 1995
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 705,358 $ 634,819
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation 181,813 116,808
(Increase) Decrease in Receivables (32,343) 68,519
Increase (Decrease) in Payable to
AEI Fund Management, Inc. (17,671) 2,812
Increase in Unearned Rent 34,862 0
Minority Interest (6,924) 0
----------- -----------
Total Adjustments 159,737 188,139
----------- -----------
Net Cash Provided By
Operating Activities 865,095 822,958
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in Real Estate (3,850,061) (854,218)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital Contributions from Limited Partners 0 1,942,224
Organization and Syndication Costs 0 (221,969)
Increase in Distributions Payable 0 91,086
Distributions to Partners (969,694) (954,549)
----------- -----------
Net Cash Provided By (Used For)
Financing Activities (969,694) 856,792
----------- -----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (3,954,660) 825,532
CASH AND CASH EQUIVALENTS, beginning of period 4,833,630 7,526,387
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 878,970 $ 8,351,919
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE PERIODS ENDED JUNE 30
(Unaudited)
Limited
Partnership
General Limited Units
Partners Partners Total Outstanding
BALANCE, December 31, 1994 $ (6,286) $ 18,354,747 $ 18,348,461 22,057.78
Capital Contributions 0 1,942,224 1,942,224 1,942.22
Organization and Syndication
Costs 0 (221,969) (221,969)
Distributions (9,546) (945,003) (954,549)
Net Income 6,348 628,471 634,819
--------- ----------- ----------- ----------
BALANCE, June 30, 1995 $ (9,484) $19,758,470 $19,748,986 24,000.00
========= =========== =========== ==========
BALANCE, December 31, 1995 $ (11,576) $19,548,040 $19,536,464 23,868.50
Distributions (9,697) (959,997) (969,694)
Net Income 7,053 698,305 705,358
--------- ----------- ----------- ----------
BALANCE, June 30, 1996 $ (14,220) $19,286,348 $19,272,128 23,868.50
========= =========== =========== ==========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996
(Unaudited)
(1) The condensed statements included herein have been prepared
by the Partnership, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission, and
reflect all adjustments which are, in the opinion of
management, necessary to a fair statement of the results of
operations for the interim period, on a basis consistent with
the annual audited statements. The adjustments made to these
condensed statements consist only of normal recurring
adjustments. Certain information, accounting policies, and
footnote disclosures normally included in financial
statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant
to such rules and regulations, although the Partnership
believes that the disclosures are adequate to make the
information presented not misleading. It is suggested that
these condensed financial statements be read in conjunction
with the financial statements and the summary of significant
accounting policies and notes thereto included in the
Partnership's latest annual report on Form 10-KSB.
(2) Organization -
AEI Net Lease Income & Growth Fund XX Limited Partnership
(Partnership) was formed to acquire and lease commercial
properties to operating tenants. The Partnership's
operations are managed by AEI Fund Management XX, Inc.
(AFM), the Managing General Partner of the Partnership.
Robert P. Johnson, the President and sole shareholder of
AFM, serves as the Individual General Partner of the
Partnership. An affiliate of AFM, AEI Fund Management,
Inc., performs the administrative and operating functions
for the Partnership.
The terms of the Partnership offering call for a
subscription price of $1,000 per Limited Partnership Unit,
payable on acceptance of the offer. The Partnership
commenced operations on June 30, 1993 when minimum
subscriptions of 1,500 Limited Partnership Units
($1,500,000) were accepted. On January 19, 1995, the
Partnership's offering terminated when the maximum
subscription limit of 24,000 Limited Partnership Units
($24,000,000) was reached.
Under the terms of the Limited Partnership Agreement, the
Limited Partners and General Partners contributed funds of
$24,000,000 and $1,000, respectively. During the operation
of the Partnership, any Net Cash Flow, as defined, which the
General Partners determine to distribute will be distributed
90% to the Limited Partners and 10% to the General Partners;
provided, however, that such distributions to the General
Partners will be subordinated to the Limited Partners first
receiving an annual, noncumulative distribution of Net Cash
Flow equal to 10% of their Adjusted Capital Contribution, as
defined, and, provided further, that in no event will the
General Partners receive less than 1% of such Net Cash Flow
per annum. Distributions to Limited Partners will be made
pro rata by Units.
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(2) Organization - (Continued)
Any Net Proceeds of Sale, as defined, from the sale or
financing of the Partnership's properties which the General
Partners determine to distribute will, after provisions for
debts and reserves, be paid in the following manner: (i)
first, 99% to the Limited Partners and 1% to the General
Partners until the Limited Partners receive an amount equal
to: (a) their Adjusted Capital Contribution plus (b) an
amount equal to 12% of their Adjusted Capital Contribution
per annum, cumulative but not compounded, to the extent not
previously distributed from Net Cash Flow; (ii) any
remaining balance will be distributed 90% to the Limited
Partners and 10% to the General Partners. Distributions to
the Limited Partners will be made pro rata by Units.
For tax purposes, profits from operations, other than
profits attributable to the sale, exchange, financing,
refinancing or other disposition of the Partnership's
property, will be allocated first in the same ratio in
which, and to the extent, Net Cash Flow is distributed to
the Partners for such year. Any additional profits will be
allocated in the same ratio as the last dollar of Net Cash
Flow is distributed. Net losses from operations will be
allocated 99% to the Limited Partners and 1% to the General
Partners.
For tax purposes, profits arising from the sale, financing,
or other disposition of the Partnership's property will be
allocated in accordance with the Partnership Agreement as
follows: (i) first, to those partners with deficit balances
in their capital accounts in an amount equal to the sum of
such deficit balances; (ii) second, 99% to the Limited
Partners and 1% to the General Partners until the aggregate
balance in the Limited Partners' capital accounts equals the
sum of the Limited Partners' Adjusted Capital Contributions
plus an amount equal to 12% of their Adjusted Capital
Contributions per annum, cumulative but not compounded, to
the extent not previously allocated; (iii) third, the
balance of any remaining gain will then be allocated 90% to
the Limited Partners and 10% to the General Partners.
Losses will be allocated 98% to the Limited Partners and 2%
to the General Partners.
The General Partners are not required to currently fund a
deficit capital balance. Upon liquidation of the
Partnership or withdrawal by a General Partner, the General
Partners will contribute to the Partnership an amount equal
to the lesser of the deficit balances in their capital
accounts or 1% of total Limited Partners' and General
Partners' capital contributions.
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate -
In 1995, the Partnership elected early adoption of the
Statement of Financial Accounting Standards No. 121,
"Accounting for Impairment of Long-Lived Assets and for Long-
Lived Assets to be Disposed Of." This standard requires the
Partnership to compare the carrying amount of its properties
to the estimated future cash flows expected to result from
the property and its eventual disposition. If the sum of
the expected future cash flows is less than the carrying
amount of the property, the Statement requires the
Partnership to recognize an impairment loss by the amount by
which the carrying amount of the property exceeds the fair
value of the property. Adoption of this Statement is not
expected to have a material effect on the Partnership's
financial statements.
The Partnership leases its properties to various tenants
through non-cancelable triple net leases, which are
classified as operating leases. Under a triple net lease,
the lessee is responsible for all real estate taxes,
insurance, maintenance, repairs and operating expenses of
the property. The initial Lease terms are 20 years except
for the Media Play property (18 years) and the Red Robin
restaurants, whose Lease Agreements expire on November 30,
2004, and December 31, 2007. The Leases contain renewal
options which may extend the Lease term an additional 10 to
25 years. The Leases contain rent clauses which entitle the
Partnership to receive additional rent in future years based
on stated rent increases. Certain lessees have been granted
options to purchase the property. Depending on the lease,
the purchase price is either determined by a formula, or is
the greater of the fair market value of the property or the
amount determined by a formula. In all cases, if the option
were to be exercised by the lessee, the purchase price would
be greater than the original cost of the property.
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
The Partnership's properties are all commercial, single-
tenant buildings. The cost of the property and related
accumulated depreciation at June 30, 1996 are as follows:
Buildings and Accumulated
Property Land Equipment Total Depreciation
HomeTown Buffet
Albuquerque, NM $ 602,859 $ 720,987 $ 1,323,846 $ 37,235
Red Robin
Colorado Springs, CO 979,057 1,323,210 2,302,267 104,754
Red Robin
Colorado Springs, CO 721,168 1,034,273 1,755,441 81,880
Arby's/Mrs. Winner's
Smyrna, GA 516,705 723,775 1,240,480 52,730
Applebee's
Middletown, OH 330,557 765,405 1,095,962 58,371
Denny's
Burleson, TX 374,721 548,759 923,480 29,562
Applebee's
McAllen, TX 463,553 856,551 1,320,104 51,183
Applebee's
Lafayette, LA 416,197 760,362 1,176,559 39,626
Applebee's
Brownsville, TX 523,042 855,694 1,378,736 28,075
Denny's
Grapevine, TX 722,668 632,053 1,354,721 13,916
Media Play
Apple Valley, MN 425,360 997,340 1,422,700 18,549
Garden Ridge
Pineville, NC 526,382 1,097,604 1,623,986 9,055
Champps Americana
Lyndhurst, OH 731,677 1,304,949 2,036,626 9,266
----------- ----------- ----------- -----------
$ 7,333,946 $11,620,962 $18,954,908 $ 534,202
=========== =========== =========== ===========
On March 28, 1996, the Partnership purchased a 18.50%
interest in a Garden Ridge store in Pineville, North
Carolina for $1,623,986. The property is leased to Garden
Ridge, Inc. under a Lease Agreement with a primary term of
20 years and annual rental payments of $174,319. The
remaining interest in the property was purchased by AEI Net
Lease Income & Growth Fund XIX Limited Partnership and AEI
Income & Growth Fund XXI Limited Partnership, affiliates of
the Partnership.
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
In August, 1995, the Partnership entered into an Agreement
to purchase an Italianni's restaurant in Columbus, Ohio.
The purchase price will be approximately $1,440,000. The
property will be leased to Ristoranti Karlo, Inc. under a
Lease Agreement with a primary term of 15 years and annual
rental payments of approximately $162,000. Through June 30,
1996, the Partnership had advanced $1,215,483 for the
construction of the property and was charging interest on
the Note at the rate of 7.0%. On May 1, 1996, the
Partnership began charging interest on the Note at the rate
of 11.25%.
On April 10, 1996, the Partnership purchased a 90.71346%
interest in a Champps Americana restaurant in Lyndhurst,
Ohio for $1,928,515. The property is leased to Americana
Dining Corporation under a Lease Agreement with a primary
term of 20 years and annual rental payments of $208,550.
The remaining interest in the property was purchased by the
Individual General Partner of the Partnership, and AEI
Institutional Net Lease Fund '93, an affiliate of the
Partnership.
During 1995, the Partnership sold 59.8646% of the HomeTown
Buffet restaurant in Albuquerque, New Mexico, in four
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $988,838
which resulted in a total net gain of $225,180. The total
cost and accumulated depreciation of the interests sold was
$792,515 and $28,857, respectively.
The Partnership owns the above property as tenants-in-common
with the unrelated third parties. The management of the
property is governed by co-tenancy agreements between the
Partnership and the unrelated third parties, which grant the
Partnership the authority to control the management of the
property. For property owned as tenants-in-common with
third parties, other than affiliated partnerships, the
Partnership accounts for its interest under the full
consolidation method whereby the unrelated third parties'
interests in the property is reflected in the Partnership's
financial statements as a minority interest. For purposes
of financial reporting, the Partnership consolidates
properties in which it is the controlling tenant-in-common
despite having only a minority equity interest in the
property. The Partnership also consolidates the Individual
General Partner's interest in the Champps Americana
restaurant in Lyndhurst, Ohio.
During the first six months of 1996 and the year 1995, the
Partnership distributed $90,164 and $486,375 of net sale
proceeds to the Limited and General Partners as part of
their regular quarterly distributions, which represented a
return of capital of $3.74 and $20.24 per Limited
Partnership Unit, respectively. The remaining net sale
proceeds will either be re-invested in additional properties
or distributed to the Partners in the future.
The Partnership has incurred net costs of $727,764 relating
to the review of potential property acquisitions. Of these
costs, $601,053 have been capitalized and allocated to land,
building and equipment. The remaining costs of $126,711
have been capitalized and will be allocated to property
acquisitions in future periods.
AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(4) Payable to AEI Fund Management, Inc. -
AEI Fund Management, Inc. performs the administrative and
operating functions for the Partnership. The payable to AEI
Fund Management represents the balance due for those
services. This balance is non-interest bearing and
unsecured and is to be paid in the normal course of
business.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
For the six months ended June 30, 1996 and 1995, the
Partnership recognized rental income from properties of $949,016
and $629,788, respectively. During the same periods, the
Partnership also earned $116,244 and $279,751 in investment
income from subscription proceeds which were invested in short-
term money market accounts, commercial paper, federal agency
notes, and construction advances. This investment income
constituted 11% and 31% of total income for the six months ended
June 30, 1996 and 1995, respectively. The percentage of total
income represented by investment income declines as subscription
proceeds are invested in properties.
The annual rent from the thirteen properties acquired, as
of June 30, 1996, is approximately $1,994,000. Since all
properties are leased under triple-net leases, the Partnership
has not incurred, and does not expect to incur, expenses
associated with the operation or maintenance of properties and
the rental income represents the cash flow generated by the
properties to the Partnership.
During the six months ended June 30, 1996 and 1995, the
Partnership paid Partnership administration expenses to
affiliated parties of $110,766 and $132,516, respectively. These
administration expenses include initial start-up costs and
expenses associated with the management of the properties,
processing distributions, reporting requirements and
correspondence to the Limited Partners. The administrative
expenses decrease after completion of the offering and
acquisition phases of the Partnership's operations. During the
same periods, the Partnership incurred Partnership administration
and property management expenses from unrelated parties of
$23,944 and $25,396, respectively. These expenses represent
direct payments to third parties for legal and filing fees,
direct administrative costs, outside audit and accounting costs,
insurance and other property costs.
The Partnership distributes all of its net income during
the offering and acquisition phases, and if net income after
deductions for depreciation is not sufficient to fund the
distributions, the Partnership may distribute other available
cash that constitutes capital for accounting purposes.
As of June 30, 1996, the Partnership's cash distribution
rate was 8.0% on an annualized basis. Distributions of Net Cash
Flow to the General Partners were subordinated to the Limited
Partners as required in the Partnership Agreement. As a result,
99% of distributions and income were allocated to Limited
Partners and 1% to the General Partners.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
Since the Partnership has only recently purchased its real
estate, inflation has had a minimal effect on income from
operations. It is expected that increases in sales volumes of
the tenants due to inflation and real sales growth, will result
in an increase in rental income over the term of the leases.
Inflation also may cause the Partnership's real estate to
appreciate in value. However, inflation and changing prices may
also have an adverse impact on the operating margins of the
properties' tenants which could impair their ability to pay rent
and subsequently reduce the Partnership's Net Cash Flow available
for distributions.
Liquidity and Capital Resources
The Partnership's primary sources of cash are from
proceeds from the sale of Units, investment income, rental income
and proceeds from the sale of property. Its primary uses of cash
are investment in real properties, payment of expenses involved
in the sale of units, the organization of the Partnership, the
acquisition of properties, the management of properties, the
administration of the Partnership, and the payment of
distributions.
While the Partnership is purchasing properties, cash flow
from investing activities (investment in real property) will
remain negative and will constitute the principal use of the
Partnership's available cash flow. This use of cash flow for
investing activities was partially offset by proceeds from the
sale of property.
During 1995, the Partnership sold 59.8646% of the HomeTown
Buffet restaurant in Albuquerque, New Mexico, in four separate
transactions to unrelated third parties. The Partnership
received total net sale proceeds of $988,838 which resulted in a
total net gain of $225,180. The total cost and accumulated
depreciation of the interests sold was $792,515 and $28,857,
respectively. The Partnership owns the property as tenants-in-
common with the unrelated third parties. The management of the
property is governed by co-tenancy agreements between the
Partnership and the unrelated third parties, which grant the
Partnership the authority to control the management of the
property. The Partnership accounts for its interest under the
full consolidation method whereby the unrelated third parties'
interests in the property are reflected in the Partnership's
financial statements as a minority interest. The Partnership
also consolidates the Individual General Partner's interest in
the Champps Americana restaurant in Lyndhurst, Ohio.
During the first six months of 1996 and the year 1995, the
Partnership distributed $90,164 and $486,375 of net sale proceeds
to the Limited and General Partners as part of their regular
quarterly distributions, which represented a return of capital of
$3.74 and $20.24 per Limited Partnership Unit, respectively. The
remaining net sale proceeds will either be re-invested in
additional properties or distributed to the Partners in the
future.
Before the acquisition of properties, cash flow from
operating activities is not significant. Net income after
adjustment for depreciation, which becomes the largest component
of cash flow from operating activities and the largest component
of cash flow after the completion of the acquisition phase, is
lower during the first few years of operations as administrative
expenses remain high and a large amount of the Partnership's
assets remain invested on a short-term basis in lower-yielding
cash equivalents.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
Until the offering of Units was completed, the
Partnership's primary source of cash flow was from the sale of
Limited Partnership Units. From January 20, 1993 to June 30,
1993, the minimum number of Limited Partnership Units (1,500)
needed to form the Partnership were sold and on June 30, 1993, a
total of 1,637.473 Units ($1,637,473) were transferred into the
Partnership. On January 19, 1995, the Partnership's offering
terminated when the maximum subscription limit of 24,000 Limited
Partnership Units ($24,000,000) was reached. From subscription
proceeds, the Partnership paid organization and syndication costs
(which constitute a reduction of capital) of $3,282,051.
After completion of the acquisition phase, the
Partnership's primary use of cash flow is distribution and
redemption payments to Partners. The Partnership declares its
regular quarterly distributions before the end of each quarter
and pays the distribution in the first week after the end of each
quarter. The Partnership attempts to maintain a stable
distribution rate from quarter to quarter. Redemption payments
are paid to redeeming Partners in the fourth quarter of each
year.
The Partnership may acquire Units from Limited Partners
who have tendered their Units to the Partnership. Such Units may
be acquired at a discount. The Partnership is not obligated to
purchase in any year more than 5% of the number of Units
outstanding at the beginning of the year. In no event shall the
Partnership be obligated to purchase Units if, in the sole
discretion of the Managing General Partner, such purchase would
impair the capital or operation of the Partnership.
During 1995, five Limited Partners redeemed a total of
131.5 Partnership Units for $118,350 in accordance with the
Partnership Agreement. The Partnership acquired these Units
using Net Cash Flow from operations. The redemptions increase
the remaining Limited Partners' ownership interest in the
Partnership.
The continuing rent payments from the properties, together
with cash generated from the property sales, should be adequate
to fund continuing distributions and meet other Partnership
obligations on both a short-term and long-term basis.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which
the Partnership is a party or of which the Partnership's
property is subject.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
PART II - OTHER INFORMATION
(Continued)
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
a. Exhibits -
Description
27 Financial Data Schedule for period
ended June 30, 1996.
b. Reports filed on Form 8-K - During the quarter ended June 30,
partnership filed a Form 8-K, dated
March 28, 1996, reporting the
acquisition of the Garden Ridge
store in Pineville, North Carolina.
During the quarter ended June 30,1996,
the Partnership filed a Form 8-K,
dated April 10, 1996, reporting the
acquisition of the Champps restaurant
in Lyndhurst, Ohio.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
Registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Dated: August 9, 1996 AEI Net Lease Income & Growth Fund XX
Limited Partnership
By: AEI Fund Management XX, Inc.
Its: Managing General Partner
By: /s/ Robert P. Johnson
Robert P. Johnson
President
(Principal Executive Officer)
By: /s/ Mark E. Larson
Mark E. Larson
Chief Financial Officer
(Principal Accounting Officer)
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<CIK> 0000894245
<NAME> AEI NET LEASE INCOME & GROWTH FUND XX LIMITED PARTNERSHIP
<S> <C>
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<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
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0
0
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<INCOME-PRETAX> 705,358
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