10-Q 1 g72696e10-q.txt SOUTHEAST ACQUISITIONS III, L.P. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 Form 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2001. [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM JANUARY 1, 2001 TO SEPTEMBER 30, 2001. Commission File number: 0-18454 (formerly 33-26759) --------------------------- SOUTHEAST ACQUISITIONS III, L.P. -------------------------------- (Exact name of registrant) Delaware 23-2532708 -------- ---------- (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 3011 Armory Drive, Suite 310 Nashville, Tennessee 37204 (Address of Principal Executive Offices) Issuer's Telephone Number: 615-834-0872 ------------ 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 [ ] PART I - FINANCIAL INFORMATION Item 1 - Financial Statements The unaudited financial statements of Southeast Acquisitions III, L.P. (the "Partnership") at September 30, 2001 are attached hereto as Exhibit A. Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations. Background The Partnership was formed to acquire, own and realize appreciation in the following properties by holding them for investment and eventual sale (each a Property, collectively the Properties) 208 acres of undeveloped land in Fulton County, Georgia; 265 acres of undeveloped land in Henry County, Georgia; 24 acres of undeveloped land near Nashville, Tennessee; 48 acres of undeveloped land near Fort Myers, Florida; and 51 acres of undeveloped land near Columbia, South Carolina. There can be no assurance that the Partnership's objectives will be realized. At September 30, 2001, the remaining land consisted of approximately 108 acres in Fulton County, Georgia and approximately 33 acres in Columbia, South Carolina. Results of Operations for Third Quarter of 2001 Compared with Third Quarter of 2000 The Partnership activities for the third quarter of 2001 and the third quarter of 2000 were focused on the sale of Partnership property. During the third quarter of 2001, as in 2000 there were no sales. However, during the third quarter of 2000, the Partnership did recognize $24,822 in extension fees related to the sale of 100 acres of the Fulton County Property that closed in escrow during the fourth quarter of 1999. This sale was finalized and funded during the second quarter of 2001. During the third quarter of 2001, the Partnership received interest income of $628 as compared to $3,158 of interest earned in the third quarter of 2000. The decrease in interest earned is a result of having a lower average cash reserve during the quarter compared to the same quarter of 2000. There was a decrease in the cash reserve during the third quarter compared to the same quarter of 2000 resulting from a distribution to the limited partners. The Partnership had previously entered into a sales contract to sell all of the remaining South Carolina land for a sales price of $24,000 per acre. This sale was contingent on a FEMA study, which was subsequently completed in September of 2001. As a result of this report, the purchaser is expected to reduce the sales price to reflect a reduction of the usable land by approximately four and half acres. However, contract contingencies could allow the purchaser to terminate the agreement. There can be no assurance that this transaction will close. The Partnership has also entered into a sales contract to sell all of the remaining Fulton County, Georgia land for a sales price of $32,100 per acre. The sale could possibly close as early as December 2001. However, the contract allows for several extension periods which could extend the closing to as late as July 2002. There are contract contingencies that could allow the purchaser to terminate the agreement. There can be no assurance that this transaction will close. Expenses in the third quarter of 2001 included general and administrative expenses of $5,850 versus $6,862 in the third quarter of 2000. The decrease was primarily due to a decrease in accounting fees and office expenses. Other expenses in the third quarter of 2001 included $2,257 for Tennessee state tax and $70 for Tennessee franchise and excise taxes. The Partnership paid no such taxes during the third quarter of 2000. The Partnership also had $6,625 of management fees, the same as was incurred in the third quarter of 2000. Real estate taxes in the third quarter of 2001 were $871 compared with $16,483 in the third quarter of 2000. This decrease was primarily due to the sale of land in Fulton County, Georgia and Ft, Myers, Florida. Insurance in the third quarter of 2001 was $56 compared with $10 in the third quarter of 2000. Inflation did not have any material impact on operations during the third quarter of 2001, and it is not expected to materially impact future operations. Liquidity and Capital Resources The Partnership has cash reserves of $74,320 at September 30, 2001, which will be used to cover the following estimated annual costs: remaining management fees of $6,625, accounting fees of $14,500, legal fees of $8,000, insurance costs of $225, property taxes of $3,540, Tennessee state taxes of $2,257, and other general and administrative expenses of $9,000. In the General Partner's opinion, the Partnership's reserves will be sufficient for an additional year. However, if additional expenses are incurred, the reserves may be inadequate to cover the Partnership's operating expenses. If the reserves are exhausted, the Partnership may have to dispose of some or all of the Properties or incur indebtedness on unfavorable terms. PART II - OTHER INFORMATION Item 1 - Legal Proceedings None Item 2 - Changes in Securities There were no changes in the Partnership's securities during the third quarter of 2001. Item 3 - Defaults Upon Senior Securities There was no default in the payment of principal, interest, a sinking or purchase fund installment or any other default with respect to any indebtedness of the Partnership. The Partnership has issued no preferred stock; accordingly, there have been no arrearages or delinquencies with respect to any such preferred stock. Item 4 - Submission of Matters to a Vote of Security Holders No matters were submitted to the Partners for a vote during the third quarter of 2001. Item 5 - Other Information None Item 6 - Exhibits and Reports on Form 8-K Reports on Form 8-K None Exhibits (numbered in accordance with Item 601 of Regulation S-K) None SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

EXHIBIT A SOUTHEAST ACQUISITIONS III, LP BALANCE SHEETS

See notes to financial statements. EXHIBIT A SOUTHEAST ACQUISITIONS III, LP STATEMENTS OF OPERATIONS AND PARTNERS' EQUITY (UNAUDITED)

* Net income per unit of limited partnership interest for the third quarter of 2000 and the nine months ended September 30, 2000 have been restated to conform to the 2001 year-end presentation. See notes to financial statements. EXHIBIT A SOUTHEAST ACQUISITIONS III, LP STATEMENTS OF CASH FLOWS (UNAUDITED)

See notes to financial statements. SOUTHEAST ACQUISITIONS III, LP (A Limited Partnership) NOTES TO FINANCIAL STATEMENTS For the Nine Months Ended September 30, 2001 (Unaudited) A. ACCOUNTING POLICIES The unaudited financial statements presented herein have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles. These statements should be read in conjunction with the financial statements and notes thereto included in Partnership's Form 10-K for the year ended December 31, 2000. In the opinion of management, such financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to summarize fairly the Partnership's financial position results of operations. The results of operations for the nine-month period ended September 30, 2001 may not be indicative of the results that may be expected for the year ending December 31, 2001. B. RELATED PARTY TRANSACTIONS The General Partner and its affiliates have been actively involved in managing the Partnership's operations. Compensation earned for these services in the first nine months 2000 and 2001 were as follows:

SOUTHEAST ACQUISITIONS III L P 10-Q