Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
|X| Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934.
For the quarterly period ended September 30, 2000
|_| 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 0-28368
ATEL Cash Distribution Fund VI, L.P.
(Exact name of registrant as specified in its charter)
California 94-3207229
---------- ----------
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
235 Pine Street, 6th Floor, San Francisco, California 94104
(Address of principal executive offices)
Registrant's telephone number, including area code: (415) 989-8800
Indicate by a check mark whether the 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 |_|
DOCUMENTS INCORPORATED BY REFERENCE
None
1
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements.
2
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
BALANCE SHEETS
SEPTEMBER 30, 2000 AND DECEMBER 31, 1999
(Unaudited)
ASSETS
2000 1999
---- ----
Cash and cash equivalents $ 2,979,142 $ 390,463
Accounts receivable 6,952,307 10,368,154
Investments in leases 71,975,673 99,946,381
----------------- -----------------
Total assets $ 81,907,122 $110,704,998
================= =================
LIABILITIES AND PARTNERS' CAPITAL
Non-recourse debt $ 30,253,794 $ 46,490,585
Line of credit - 8,350,000
Accounts payable:
General Partner 144,234 1,076,757
Equipment purchases 5,452 5,452
Other 505,535 593,862
Accrued interest payable 758,676 1,551,104
Unearned operating lease income 173,322 429,486
----------------- -----------------
Total liabilities 31,841,013 58,497,246
Partners' capital:
General Partner (490,099) (567,944)
Limited Partners 50,556,208 52,775,696
----------------- -----------------
Total partners' capital 50,066,109 52,207,752
----------------- -----------------
Total liabilities and partners' capital $ 81,907,122 $110,704,998
================= =================
See accompanying notes.
3
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
STATEMENTS OF OPERATIONS
NINE AND THREE MONTH PERIODS ENDED
SEPTEMBER 30, 2000 AND 1999
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
------------- -------------
2000 1999 2000 1999
---- ---- ---- ----
Revenues:
Leasing activities:
<S> <C> <C> <C> <C>
Operating leases $17,263,810 $ 26,218,702 $ 5,634,027 $ 8,163,781
Direct financing leases 74,155 82,736 24,147 26,130
Gain (loss) on sales of assets 3,930,585 222,217 (172,840) 64,778
Interest 151,931 5,879 82,822 2,432
Other 20,128 17,367 15,833 4,848
----------------- ------------------ ----------------- -----------------
21,440,609 26,546,901 5,583,989 8,261,969
Expenses:
Depreciation and amortization 12,759,010 17,327,722 3,688,859 5,471,107
Interest expense 2,484,852 3,710,959 754,695 1,193,081
Equipment and incentive management fees to
General Partner 698,937 886,812 208,409 310,796
Other 612,246 521,470 249,235 171,184
Administrative cost reimbursements to General
Partner 340,035 278,463 125,108 128,155
Professional fees 81,813 53,660 12,883 14,999
Provision for losses - 500,000 - 500,000
----------------- ------------------ ----------------- -----------------
16,976,893 23,279,086 5,039,189 7,789,322
----------------- ------------------ ----------------- -----------------
Income before extraordinary item 4,463,716 3,267,815 544,800 472,647
Extraordinary gain on early extinguishment of
debt 3,320,774 - 3,320,774 -
----------------- ------------------ ----------------- -----------------
Net income $ 7,784,490 $ 3,267,815 $ 3,865,574 $ 472,647
================= ================== ================= =================
Net income:
General Partner $ 77,845 $ 32,678 $ 38,656 $ 4,726
Limited Partners 7,706,645 3,235,137 3,826,918 467,921
----------------- ------------------ ----------------- -----------------
$ 7,784,490 $ 3,267,815 $ 3,865,574 $ 472,647
================= ================== ================= =================
Income before extraordinary item per limited
partnership unit $ 0.35 $ 0.26 $ 0.04 $ 0.04
Extraordinary gain on early extinguishment of
debt per limited partnership unit 0.27 - 0.27 -
----------------- ------------------ ----------------- -----------------
Net income per limited partnership unit $ 0.62 $ 0.26 $ 0.31 $ 0.04
================= ================== ================= =================
Weighted average number of Units outstanding 12,500,050 12,500,050 12,500,050 12,500,050
</TABLE>
See accompanying notes.
4
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
NINE MONTH PERIOD ENDED
SEPTEMBER 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
Limited Partners General
Units Amount Partner Total
<S> <C> <C> <C> <C>
Balance December 31, 1999 12,500,050 $ 52,775,696 $ (567,944) $ 52,207,752
Distributions to partners (9,926,133) - (9,926,133)
Net income 7,706,645 77,845 7,784,490
----------------- ------------------ ----------------- -----------------
Balance September 30, 2000 12,500,050 $ 50,556,208 $ (490,099) $ 50,066,109
================= ================== ================= =================
</TABLE>
See accompanying notes.
STATEMENTS OF CASH FLOWS
NINE AND THREE MONTH PERIODS ENDED
SEPTEMBER 30, 2000 AND 1999
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
------------- -------------
2000 1999 2000 1999
---- ---- ---- ----
Operating activities:
<S> <C> <C> <C> <C>
Net income $ 7,784,490 $ 3,267,815 $ 3,865,574 $ 472,647
Adjustment to reconcile net income to cash
provided by operating activities:
Depreciation and amortization 12,759,010 17,327,722 3,688,859 5,471,107
(Gain) loss on sales of assets (3,930,585) (222,217) 172,840 (64,778)
Provision for losses - 500,000 - 500,000
Extraordinary gain on early extinguishment of
debt (3,320,774) - (3,320,774) -
Changes in operating assets and liabilities:
Accounts receivable (1,384,153) (2,742,991) (1,755,259) (5,671,357)
Accounts payable, General Partner (932,523) 950,244 (148,836) 93,724
Accounts payable, other (88,327) 126,445 (23,850) 38,855
Accrued interest payable 981,917 904,099 331,944 2,370,820
Unearned lease income (256,164) 116,865 (19,485) 46,452
----------------- ------------------ ----------------- -----------------
Net cash provided by operations 11,612,891 20,227,982 2,791,013 3,257,470
----------------- ------------------ ----------------- -----------------
Investing activities:
Proceeds from sales of assets 18,990,133 1,437,950 136,349 566,759
Reduction in net investment in direct financing
leases 152,150 186,910 38,576 83,043
Purchases of equipment on operating leases - (116,028) - 8,372
----------------- ------------------ ----------------- -----------------
Net cash provided by investing activities 19,142,283 1,508,832 174,925 658,174
----------------- ------------------ ----------------- -----------------
</TABLE>
5
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
STATEMENT OF CASH FLOWS
(CONTINUED)
NINE AND THREE MONTH PERIODS ENDED
SEPTEMBER 30, 2000 AND 1999
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
------------- -------------
2000 1999 2000 1999
---- ---- ---- ----
Financing activities:
<S> <C> <C> <C> <C>
Distributions to Partners (9,926,133) (9,889,704) (3,363,759) (3,282,639)
Repayments of non-recourse debt (9,890,362) (13,822,840) (1,921,667) (1,062,588)
Repayments of borrowings under line of credit (8,350,000) - - -
Borrowings under line of credit - 2,250,000 - 1,000,000
----------------- ------------------ ----------------- -----------------
Net cash used in financing activities (28,166,495) (21,462,544) (5,285,426) (3,345,227)
----------------- ------------------ ----------------- -----------------
Net increase (decrease) in cash and cash
equivalents 2,588,679 274,270 (2,319,488) 570,417
Cash and cash equivalents at beginning of
period 390,463 744,132 5,298,630 447,985
----------------- ------------------ ----------------- -----------------
Cash and cash equivalents at end of period $ 2,979,142 $ 1,018,402 $ 2,979,142 $ 1,018,402
================= ================== ================= =================
Supplemental disclosures of cash flow
information:
Cash paid during the period for interest $ 3,277,280 $ 4,910,896 $ 2,197,096 $ 3,030,333
================= ================== ================= =================
Supplemental disclosure of non-cash
transactions:
Offset of accounts receivable and debt service per
lease and debt agreement:
Accrued interest payable $ (1,774,345) $(2,104,036) $ - $ -
Non-recourse debt (3,025,655) (2,695,964) - -
----------------- ------------------ ----------------- -----------------
Accounts receivable $ (4,800,000) $(4,800,000) $ - $ -
================= ================== ================= =================
</TABLE>
See accompanying notes.
6
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(Unaudited)
1. Summary of significant accounting policies:
Interim financial statements:
The unaudited interim financial statements reflect all adjustments which are, in
the opinion of the general partners, necessary to a fair statement of financial
position and results of operations for the interim periods presented. All such
adjustments are of a normal recurring nature. These unaudited interim financial
statements should be read in conjunction with the most recent report on Form
10K.
2. Organization and partnership matters:
ATEL Cash Distribution Fund VI, L.P. (the Fund), was formed under the laws of
the State of California on June 29 , 1994, for the purpose of acquiring
equipment to engage in equipment leasing and sales activities. Contributions in
the amount of $600 were received as of July 21, 1994, $100 of which represented
the General Partner's (ATEL Financial Corporation's) continuing interest, and
$500 of which represented the Initial Limited Partners' capital investment.
Upon the sale of the minimum amount of Units of Limited Partnership interest
(Units) of $1,200,000 and the receipt of the proceeds thereof on January 3,
1995, the Partnership commenced operations.
The Partnership does not make a provision for income taxes since all income and
losses will be allocated to the Partners for inclusion in their individual tax
returns.
3. Investment in leases:
The Partnership's investment in leases consists of the following:
<TABLE>
<CAPTION>
Depreciation
Balance Expense or Reclass- Balance
December 31, Amortization ifications & September 30,
1999 of Leases Dispositions 2000
---- --------- ------------ ----
<S> <C> <C> <C> <C>
Net investment in operating leases $102,305,273 $(12,359,613) $(18,289,284) $ 71,656,376
Equipment held for sale or lease 645,593 - 3,222,804 3,868,397
Initial direct costs, net of accumulated
amortization of $2,923,6172,094,732 in
2000 and $2,568,966 in 1999 1,494,753 (399,397) - 1,095,356
Net investment in direct financing leases 1,019,587 (152,150) 6,932 874,369
Residual interests 379,551 - - 379,551
Reserve for losses (5,898,376) - - (5,898,376)
----------------- ------------------ ----------------- -----------------
$99,946,381 $(12,911,160) $(15,059,548) $ 71,975,673
================= ================== ================= =================
</TABLE>
7
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(Unaudited)
3. Investment in leases (continued):
Property on operating leases consists of the following:
<TABLE>
<CAPTION>
Balance Balance
December 31, Acquisitions, Dispositions & Reclassifications September 30,
----------------------------------------------
1999 1st Quarter 2nd Quarter 3rd Quarter 2000
---- ----------- ----------- ----------- ----
<S> <C> <C> <C> <C> <C>
Transportation $ 109,727,891 $ (18,286,459) $ 5,238,438 $(5,340,899) $ 91,338,971
Materials handling 19,507,740 (77,768) (2,717,599) 2,310,088 19,022,461
Construction 17,753,581 (1,250,021) (756,654) - 15,746,906
Manufacturing 29,440,009 (18,320,603) - - 11,119,406
Office automation 6,578,010 (741,224) (2,645,923) 890,149 4,081,012
Other 2,964,538 (347,462) (1,345,729) 750,300 2,021,647
------------------ ----------------- ------------------ ----------------- -----------------
185,971,769 (39,023,537) (2,227,467) (1,390,362) 143,330,403
Less accumulated depreciation (83,666,496) 16,261,566 (1,969,591) (2,299,506) (71,674,027)
------------------ ----------------- ------------------ ----------------- -----------------
$ 102,305,273 $ (22,761,971) $(4,197,058) $(3,689,868) $ 71,656,376
================== ================= ================== ================= =================
</TABLE>
All of the property on leases was acquired in 1995, 1996 and 1997.
At September 30, 2000, the aggregate amounts of future minimum lease payments
are as follows:
<TABLE>
<CAPTION>
Direct
Operating Financing
Leases Leases Total
<S> <C> <C> <C>
Three months ending December 31, 2000 $ 3,898,870 $ 64,252 $ 3,963,122
Year ending December 31, 2001 10,704,207 231,853 10,936,060
2002 5,335,918 158,720 5,494,638
2003 3,299,765 98,760 3,398,525
2004 2,808,012 98,760 2,906,772
Thereafter 14,867,061 296,280 15,163,341
----------------- ------------------ -----------------
$40,913,833 $ 948,625 $ 41,862,458
================= ================== =================
</TABLE>
8
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(Unaudited)
4. Non-recourse debt:
Notes payable to financial institutions are due in varying monthly, quarterly
and semi-annual installments of principal and interest. The notes are secured by
assignments of lease payments and pledges of the assets which were purchased
with the proceeds of the particular notes. Interest rates on the notes vary from
6.37% to 15.54%.
Future minimum principal payments of non-recourse debt as of September 30, 2000
are as follows:
<TABLE>
<CAPTION>
Principal Interest Total
<S> <C> <C> <C>
Three months ending December 31, 2000 $ 1,050,612 $ 363,054 $ 1,413,666
Year ending December 31, 2001 7,448,433 2,478,980 9,927,413
2002 5,745,613 1,828,731 7,574,344
2003 5,487,689 1,239,498 6,727,187
2004 822,894 635,737 1,458,631
Thereafter 9,698,553 3,649,283 13,347,836
----------------- ------------------ -----------------
$30,253,794 $ 10,195,283 $ 40,449,077
================= ================== =================
</TABLE>
5. Related party transactions:
The terms of the Limited Partnership Agreement provide that the General Partner
and/or Affiliates are entitled to receive certain fees for equipment
acquisition, management and resale and for management of the Partnership.
The General Partner and/or Affiliates earned fees, commissions and
reimbursements, pursuant to the Limited Partnership Agreement as follows:
<TABLE>
<CAPTION>
2000 1999
---- ----
<S> <C> <C>
Incentive management fees (computed as 3.25% of distributions of cash from
operations, as defined in the Limited Partnership Agreement) and equipment
management fees (computed as 3.5% of gross revenues from operating leases, as
defined in the Limited Partnership Agreement plus 2% of gross revenues from full
payout leases, as defined in the Limited Partnership Agreement). $ 698,937 $ 886,812
Administrative cost reimbursements to General Partner 340,035 278,463
----------------- -----------------
$ 1,038,972 $ 1,165,275
================= =================
</TABLE>
The Limited Partnership Agreement allows for the reimbursement of costs incurred
by the General Partner in providing administrative services to the Partnership.
Administrative services provided include Partnership accounting, investor
relations, legal counsel and lease and equipment documentation. The General
Partner is not reimbursed for services where it is entitled to receive a
separate fee as compensation for such services, such as acquisition and
management of equipment. Reimbursable costs incurred by the General Partner are
allocated to the Partnership based upon actual time incurred by employees
working on Partnership business and an allocation of rent and other costs based
on utilization studies.
9
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(Unaudited)
5. Related party transactions (continued):
Substantially all employees of the General Partner record time incurred in
performing administrative services on behalf of all of the Partnerships serviced
by the General Partner. The General Partner believes that the costs reimbursed
are the lower of actual costs incurred on behalf of the Partnership or the
amount the Partnership would be required to pay independent parties for
comparable administrative services in the same geographic location and are
reimbursable in accordance with the Limited Partnership Agreement.
6. Partner's capital:
As of September 30, 2000, 12,500,050 Units ($125,000,500) were issued and
outstanding. The Fund is authorized to issue up to 12,500,050 Units, including
the 50 Units issued to the initial limited partners.
The Partnership Net Profits, Net Losses, and Tax Credits are to be allocated 99%
to the Limited Partners and 1% to the General Partner.
Available Cash from Operations and Cash from Sales and Refinancing, as defined
in the Limited Partnership Agreement, shall be distributed as follows:
First, 95.75% of Distributions of Cash from Operations to the Limited Partners,
1% of Distributions of Cash from Operations to the General Partner and 3.25% to
an affiliate of the General Partner as Incentive Management Compensation, 99% of
Distributions of Cash from Sales or Refinancing to the Limited Partners and 1%
of Cash from Sales or Refinancing to the General Partner.
Second, the balance to the Limited Partners until the Limited Partners have
received Aggregate Distributions in an amount equal to their Original Invested
Capital, as defined, plus a 10% per annum cumulative (compounded daily) return
on their Adjusted Invested Capital.
Third, an affiliate of the General Partner will receive as Incentive Management
Compensation, 3.25% of remaining Cash from Sales or Refinancing.
Fourth, the balance to the Limited Partners.
10
<PAGE>
ATEL CASH DISTRIBUTION FUND VI, L.P.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(Unaudited)
7. Line of credit:
The Partnership participates with the General Partner and certain of its
Affiliates in a $77,500,000 revolving credit agreement with a group of financial
institutions which expires on July 28, 2001. The agreement includes an
acquisition facility and a warehouse facility which are used to provide bridge
financing for assets on leases. Draws on the acquisition facility by any
individual borrower are secured only by that borrower's assets, including
equipment and related leases. Borrowings on the warehouse facility are recourse
jointly to certain of the Affiliates, the Partnership and the General Partner.
At September 30, 2000, the Partnership had no borrowings under the line of
credit.
The credit agreement includes certain financial covenants applicable to each
borrower. The Partnership was incompliance with its covenants as of September
30, 2000.
11
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Capital Resources and Liquidity
In 2000, the Partnership's primary activity was equipment leasing and sales
activities.
The Partnership's primary source of liquidity during the first nine months of
2000 was lease rents and proceeds from the sales of lease assets. The
Partnership's primary source of liquidity during the first nine months of 1999
was lease rents. The liquidity of the Partnership will vary in the future,
increasing to the extent cash flows from leases exceed expenses, and decreasing
as lease assets are acquired, as distributions are made to the limited partners
and to the extent expenses exceed cash flows from leases.
As another source of liquidity, the Partnership has contractual obligations with
a diversified group of lessees which consist primarily of fixed lease terms at
fixed rental amounts. As the initial lease terms expire, the Partnership will
re-lease or sell the equipment. The future liquidity beyond the contractual
minimum rentals will depend on the General Partner's success in re-leasing or
selling the equipment as it comes off lease.
The Partnership participates with the General Partner and certain of its
affiliates in a $77,500,000 revolving line of credit with a group of financial
institutions. The line of credit expires on July 28, 2001.
The Partnership anticipates reinvesting a portion of lease payments from assets
owned in new leasing transactions. Such reinvestment will occur only after the
payment of all obligations, including debt service (both principal and
interest), the payment of management and acquisition fees to the General Partner
and providing for cash distributions to the Limited Partners.
The Partnership currently has available adequate reserves to meet contingencies,
but in the event those reserves were found to be inadequate, the Partnership
would likely be in a position to borrow against its current portfolio to meet
such requirements. The General Partner envisions no such requirements for
operating purposes.
As of September 30, 2000, the Partnership had borrowed $100,521,405 with a
remaining unpaid balance of $33,574,568. The General Partner expects that
aggregate borrowings in the future will not exceed 50% of aggregate equipment
cost. In any event, the Agreement of Limited Partnership limits such borrowings
to 50% of the total cost of equipment, in aggregate.
No commitments of capital have been or are expected to be made other than for
the acquisition of additional equipment. There were no such commitments as of
September 30, 2000.
If inflation in the general economy becomes significant, it may affect the
Partnership inasmuch as the residual (resale) values and rates on re-leases of
the Partnership's leased assets may increase as the costs of similar assets
increase. However, the Partnership's revenues from existing leases would not
increase, as such rates are generally fixed for the terms of the leases without
adjustment for inflation.
If interest rates increase significantly, the lease rates that the Partnership
can obtain on future leases will be expected to increase as the cost of capital
is a significant factor in the pricing of lease financing. Leases already in
place, for the most part, would not be affected by changes in interest rates.
2000 vs. 1999:
In 2000 and 1999, lease rents were the Partnership's primary source of cash from
operating activities. Lease rents have declined as a result of lease
terminations and asset sales over the last year.
Proceeds from the sales of assets and direct financing lease rents were the only
investing sources of cash. Proceeds from sales of such assets increased by
$17,552,183 compared to 1999. Most of the proceeds from sales in 2000 resulted
from the sales of assets on lease to Consolidated Rail and NEC Electronics. The
only investing use of cash in 1999 was payments on the purchase of assets on
operating leases. There were none in 2000.
Financing sources of cash consisted of borrowings on the line of credit in 1999.
Repayments of non-recourse debt have decreased as a result of scheduled debt
payments.
12
<PAGE>
Results of operations
For the nine month periods, operations resulted in net income of $4,463,716 in
2000 and $3,767,815 in 1999. For the three month periods, operations resulted in
net income of $544,800 in 2000 and a net loss of $$972,642 in 1999. The
Partnership's primary source of revenues is from operating leases.
Operating lease revenues decreased slightly for both the nine and three month
periods compared to 1999 as a result of lease terminations and asset sales over
the last year.
Depreciation expense has declined by $4,568,712 (nine months) and $1,782,248
(three months) compared to 1999. The decreases were the result of asset sales
over the last year.
Non-recourse debt balances have been reduced in 2000 compared to 1999 as a
result of scheduled debt payments. This has led to the reduction of interest
expense of $1,226,107 in 2000 compared to 1999 for the nine month period and
$438,386 for the three month period.
In December 1999, one of the Partnership's lessees (Applied Magnetics) defaulted
on its leases and sought protection under the Bankruptcy Act. As a result,
reserves were established related to those assets which had been leased to
Applied Magnetics as of December 31, 1999. During the third quarter of 2000,
most of the lease assets were sold at auction and the non-recourse debt which
had been used to finance a significant portion of the assets was extinguished,
giving rise to an extraordinary gain.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Quaker Coal Company
On December 31, 1997, Quaker Coal Company requested a moratorium on lease
payments from January through March 1998. No lease payments were made through
June of 1998. As a result, the General Partner declared the lease in default.
Subsequently, the lessee made the outstanding payments, however, the General
Partner refused to waive the default and insisted on additional damages in the
range of $1,428,000 to $1,743,000. The General Partner sued the lessee for
damages and was awaiting judgment from the court when on June 16, 2000, the
lessee filed for protection under the U. S. Bankruptcy Act.
The Partnership has filed a stipulation for relief from stay to allow the court
to issue its ruling, and has filed a request to participate on the Official
Committee of Unsecured Creditors. The Partnership has succeeded upon securing
the return of its equipment which it is currently liquidating. The amounts of
these damages have not been included in the financial statements included in
Item 1 of this report, however the liklihood of recovery of amounts above the
liquidation of the equipment is speculative.
Applied Magnetics Corporation
In January 2000, Applied Magnetics Corporation, a lessee of the Partnership,
filed for protection from creditors under Chapter 11 of the U. S. Bankruptcy
Act. The Partnership has assets with a total net book value of $5,113,290 leased
to Applied Magnetics Corporation. On January 31, 2000, the General Partner was
appointed to the Official Committee of Unsecured Creditors and currently serves
as the Chairperson of the Committee. Procedures were quickly undertaken for the
liquidation of the Partnership's leased equipment, which proceeds were used to
satisfy non-recourse debt secured by the equipment. Other than the proceeds
received from the liquidation of the Partnership's equipment, additional
recoveries by the Partnership, resulting from this default, are fairly
speculative.
13
<PAGE>
The Partnership anticipates additional amounts may be recoverable through the
reorganization of the lessee's business, however, any recoveries above the
amounts received upon liquidation of the Partnership's equipment are highly
uncertain and speculative. As of November 1, 2000, liquidation of the assets was
completed.
Item 2. Changes In Securities.
Inapplicable.
Item 3. Defaults Upon Senior Securities.
Inapplicable.
Item 4. Submission Of Matters To A Vote Of Security Holders.
Inapplicable.
Item 5. Other Information.
Inapplicable.
Item 6. Exhibits And Reports On Form 8-K.
(a)Documents filed as a part of this report
1. Financial Statements
Included in Part I of this report:
Balance Sheets, September 30, 2000 and December 31,
1999.
Statement of changes in partners' capital for the nine
month period ended September 30, 2000.
Statements of operations for the nine and three month
periods ended September 30, 2000 and 1999.
Statements of cash flows for the nine and three month
periods ended September 30, 2000 and 1999.
Notes to the Financial Statements
2. Financial Statement Schedules
All other schedules for which provision is made in the
applicable accounting regulations of the Securities and
Exchange Commission are not required under the related
instructions or are inapplicable, and therefore have
been omitted.
(b) Report on Form 8-K
None
14
<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.
Date:
November 9, 2000
ATEL CASH DISTRIBUTION FUND VI, L.P.
(Registrant)
By: ATEL Financial Corporation
General Partner of Registrant
By: /s/ A. J. BATT
--------------------------------------------
A. J. Batt
President and Chief Executive Officer of
General Partner
By: /s/ DEAN L. CASH
--------------------------------------------
Dean L. Cash
Executive Vice President of General Partner
By: /s/ PARITOSH K. CHOKSI
--------------------------------------------
Paritosh K. Choksi
Principal financial officer of registrant
By: /s/ DONALD E. CARPENTER
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Donald E. Carpenter
Principal accounting officer of registrant
