SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(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, 2003
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 0-23719
WELLS REAL ESTATE FUND X, L.P.
(Exact name of registrant as specified in its charter)
| Georgia | 58-2250093 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | |
| 6200 The Corners Pkwy., Norcross, Georgia |
30092 | |
| (Address of principal executive offices) | (Zip Code) | |
| Registrant’s telephone number, including area code | (770) 449-7800 | |
(Former name, former address, and former fiscal year, if changed since last report)
Indicate by 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 ¨
FORM 10-Q
WELLS REAL ESTATE FUND X, L.P.
(A Georgia Public Limited Partnership)
| Page No. | ||||||||||
| PART I. |
FINANCIAL INFORMATION | |||||||||
| Item 1. | Financial Statements |
|||||||||
| Balance Sheets—June 30, 2003 (unaudited) and December 31, 2002 |
3 | |||||||||
| 4 | ||||||||||
| 5 | ||||||||||
| Statements of Cash Flows for the Six Months Ended June 30, 2003 (unaudited) and 2002 (unaudited) |
6 | |||||||||
| 7 | ||||||||||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
12 | ||||||||
| Item 3. | 15 | |||||||||
| Item 4. | 15 | |||||||||
| PART II. |
OTHER INFORMATION | 16 | ||||||||
2
WELLS REAL ESTATE FUND X, L.P.
(A Georgia Public Limited Partnership)
| (unaudited) 2003 |
December 31, 2002 | |||||
| ASSETS: |
||||||
| Investments in Joint Ventures |
$ | 18,931,754 | $ | 19,414,110 | ||
| Due from Joint Ventures |
515,587 | 368,624 | ||||
| Cash and cash equivalents |
30,134 | 153,072 | ||||
| Deferred project costs |
3,154 | 3,154 | ||||
| Total assets |
$ | 19,480,629 | $ | 19,938,960 | ||
| LIABILITIES AND PARTNERS’ CAPITAL: |
||||||
| Liabilities: |
||||||
| Partnership distribution payable |
$ | 412,032 | $ | 494,704 | ||
| Accounts payable |
15,554 | 17,726 | ||||
| Total liabilities |
427,586 | 512,430 | ||||
| Partners’ capital: |
||||||
| Limited partners: |
||||||
| Class A—2,354,467 units and 2,328,014 units outstanding as of June 30, 2003 and December 31, 2002, respectively |
19,053,043 | 19,426,530 | ||||
| Class B—358,424 units and 384,877 units outstanding as of June 30, 2003 and December 31, 2002, respectively |
0 | 0 | ||||
| Total partners’ capital |
19,053,043 | 19,426,530 | ||||
| Total liabilities and partners’ capital |
$ | 19,480,629 | $ | 19,938,960 | ||
See accompanying notes
3
WELLS REAL ESTATE FUND X, L.P.
(A Georgia Public Limited Partnership)
| (unaudited) Three Months Ended |
(unaudited) Six Months Ended |
|||||||||||||
| June 30, 2003 |
June 30, 2002 |
June 30, 2003 |
June 30, 2002 |
|||||||||||
| REVENUES: |
||||||||||||||
| Equity in income of Joint Ventures |
$ | 299,626 | $ | 363,478 | $ | 573,282 | $ | 691,518 | ||||||
| Other income |
0 | 460 | 579 | 1,800 | ||||||||||
| 299,626 | 363,938 | 573,861 | 693,318 | |||||||||||
| EXPENSES: |
||||||||||||||
| Partnership administration |
39,510 | 49,786 | 65,724 | 62,676 | ||||||||||
| General and administrative |
7,380 | 1,787 | 8,783 | 3,839 | ||||||||||
| Legal and accounting |
4,011 | 2,992 | 7,510 | 10,301 | ||||||||||
| 50,901 | 54,565 | 82,017 | 76,816 | |||||||||||
| NET INCOME |
$ | 248,725 | $ | 309,373 | $ | 491,844 | $ | 616,502 | ||||||
| NET INCOME ALLOCATED TO CLASS A LIMITED PARTNERS |
$ | 248,725 | $ | 526,938 | $ | 491,844 | $ | 1,037,031 | ||||||
| NET LOSS ALLOCATED TO CLASS B LIMITED PARTNERS |
$ | 0 | $ | (217,565 | ) | $ | 0 | $ | (420,529 | ) | ||||
| NET INCOME PER WEIGHTED AVERAGE CLASS A LIMITED PARTNER UNIT |
$ | 0.11 | $ | 0.23 | $ | 0.21 | $ | 0.45 | ||||||
| NET LOSS PER WEIGHTED AVERAGE CLASS B LIMITED PARTNER UNIT |
$ | 0.00 | $ | (0.56 | ) | $ | 0.00 | $ | (1.08 | ) | ||||
| CASH DISTRIBUTION PER WEIGHTED AVERAGE CLASS A LIMITED PARTNER UNIT |
$ | 0.18 | $ | 0.21 | $ | 0.37 | $ | 0.43 | ||||||
| WEIGHTED AVERAGE LIMITED PARTNER UNITS OUTSTANDING: |
||||||||||||||
| CLASS A |
2,354,467 | 2,327,614 | 2,346,117 | 2,324,748 | ||||||||||
| CLASS B |
358,424 | 385,277 | 366,774 | 388,144 | ||||||||||
See accompanying notes
4
WELLS REAL ESTATE FUND X, L.P.
(A Georgia Public Limited Partnership)
STATEMENTS OF PARTNERS’ CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 2002
AND THE SIX MONTHS ENDED JUNE 30, 2003 (UNAUDITED)
| Limited Partners |
Total Partners’ Capital |
||||||||||||||||
| Class A |
Class B |
||||||||||||||||
| Units |
Amounts |
Units |
Amounts |
||||||||||||||
| BALANCE, December 31, 2001 |
2,316,618 | $ | 19,132,021 | 396,273 | $ | 1,031,391 | $ | 20,163,412 | |||||||||
| Net income (loss) |
0 | 1,977,552 | 0 | (737,200 | ) | 1,240,352 | |||||||||||
| Partnership distributions |
0 | (1,977,234 | ) | 0 | 0 | (1,977,234 | ) | ||||||||||
| Class B conversions |
11,396 | 294,191 | (11,396 | ) | (294,191 | ) | 0 | ||||||||||
| BALANCE, December 31, 2002 |
2,328,014 | 19,426,530 | 384,877 | 0 | 19,426,530 | ||||||||||||
| Net income |
0 | 491,844 | 0 | 0 | 491,844 | ||||||||||||
| Partnership distributions |
0 | (865,331 | ) | 0 | 0 | (865,331 | ) | ||||||||||
| Class B conversions |
26,453 | 0 | (26,453 | ) | 0 | 0 | |||||||||||
| BALANCE, June 30, 2003 (unaudited) |
2,354,467 | $ | 19,053,043 | 358,424 | $ | 0 | $ | 19,053,043 | |||||||||
See accompanying notes
5
WELLS REAL ESTATE FUND X, L.P.
(A Georgia Public Limited Partnership)
| (unaudited) Six Months Ended |
||||||||
| June 30, 2003 |
June 30, 2002 |
|||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
| Net income |
$ | 491,844 | $ | 616,502 | ||||
| Adjustments to reconcile net income to net cash used in operating activities: |
||||||||
| Equity in income of Joint Ventures |
(573,282 | ) | (691,518 | ) | ||||
| Changes in assets and liabilities: |
||||||||
| Accounts payable |
(2,172 | ) | (3,896 | ) | ||||
| Net cash used in operating activities |
(83,610 | ) | (78,912 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
| Distributions received from Joint Ventures |
908,675 | 1,074,902 | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
| Distributions to partners |
(948,003 | ) | (1,058,078 | ) | ||||
| NET DECREASE IN CASH AND CASH EQUIVALENTS |
(122,938 | ) | (62,088 | ) | ||||
| CASH AND CASH EQUIVALENTS, beginning of period |
153,072 | 201,387 | ||||||
| CASH AND CASH EQUIVALENTS, end of period |
$ | 30,134 | $ | 139,299 | ||||
| SUPPLEMENTAL DISCLOSURES OF NONCASH ACTIVITIES: |
||||||||
| Due from Joint Ventures |
$ | 515,587 | $ | 491,116 | ||||
| Partnership distributions payable |
$ | 412,032 | $ | 494,619 | ||||
See accompanying notes
6
WELLS REAL ESTATE FUND X, L.P.
(A Georgia Public Limited Partnership)
CONDENSED NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2003 (UNAUDITED)
| 1. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
(a) Organization and Business
Wells Real Estate Fund X, L.P. (the “Partnership”) is a Georgia public limited partnership with Leo F. Wells, III and Wells Partners, L.P. (“Wells Partners”), a Georgia nonpublic limited partnership, serving as the general partners (the “General Partners”). The Partnership was formed on June 20, 1996 for the purpose of acquiring, developing, owning, operating, improving, leasing, and managing income-producing commercial properties for investment purposes. Upon subscription, limited partners elect to have their units treated as Class A Units or Class B Units. Limited partners have the right to change their prior elections to have some or all of their units treated as Class A Units or Class B Units one time during each annual accounting period. Limited partners may vote to, among other things, (a) amend the partnership agreement, subject to certain limitations; (b) change the business purpose or investment objectives of the Partnership; and (c) add or remove a general partner. A majority vote on any of the above described matters will bind the Partnership without the concurrence of the General Partners. Each limited partnership unit has equal voting rights regardless of class.
On December 31, 1996, the Partnership commenced a public offering of up to $35,000,000 of limited partnership units pursuant to a Registration Statement filed on Form S-11 under the Securities Act of 1933. The Partnership commenced active operations on February 4, 1997 upon receiving and accepting subscriptions for 125,000 units. The offer terminated on December 30, 1997 at which time approximately 2,116,099 and 596,792 units had been sold to 1,593 and 219 Class A and Class B limited partners, respectively, for total limited partner Capital Contributions of $27,128,912. As of June 30, 2003, th