Polaris Aircraft Income Fund I – ‘8-K’ for 1/24/96

As of:  Thursday, 2/8/96   ·   For:  1/24/96   ·   Accession #:  748218-96-1   ·   File #:  2-91762

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Current Report   —   Form 8-K
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Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         January 24, 1996 - Other Event                         3     12K 

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 8-K

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CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934

Date of report (date of earliest event reported): January 24, 1996              

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 Commission File No. 2-91762

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POLARIS AIRCRAFT INCOME FUND I

 State of Organization: California
IRS Employer Identification No. 94-2938977
 201 Mission Street, 27th Floor, San Francisco, California 94105
Telephone - (415) 284-7400

This document consists of 3 pages.

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Item 5.   Other Events                                                          

Viscount Air Services, Inc. (Viscount) Default                                  

As discussed in Polaris Aircraft Income Fund I's (the  Partnership's)  Quarterly
Report to the Securities and Exchange  Commission on Form 10-Q for the quarterly
period ended September 30, 1995, the  Partnership  has been in discussions  with
its lessee Viscount to restructure certain of Viscount's  financial  obligations
to  the  Partnership.   While  such  discussions  were  underway,  Viscount  had
undertaken to pay in full, by the end of each month, beginning in June 1995, the
current  month's  obligations by making partial  periodic  payments  during that
month.  Viscount is presently in default on these  financial  obligations to the
Partnership.  As discussed in previous filings, Viscount's failure to perform on
its financial  obligations  with the  Partnership is expected to have an adverse
effect on the Partnership's financial position.                                 

On  December  13,  1995,  the  Partnership  sent a notice of default to Viscount
demanding,  within 10 days,  full  payment  of all  delinquent  amounts  due the
Partnership.  On January 9, 1996, Viscount was notified that the Partnership had
elected  to  terminate  the leases and the  Partnership  demanded  return of the
Aircraft.  On January 24, 1996,  Viscount filed a petition for protection  under
chapter  11 of the  Bankruptcy  Code in the U.S.  Bankruptcy  Court  in  Tucson,
Arizona.  Viscount  presently has possession of the aircraft and engines.  Legal
counsel has been  retained  and the general  partner is  evaluating  the rights,
remedies  and courses of action  available  to the  Partnership  with respect to
Viscount's default and bankruptcy filing.                                       

The  Partnership's  three Boeing  737-200  commercial jet aircraft and two spare
engines were on lease to Viscount prior to the lease termination  notifications.
Viscount  had  sub-leased  one of the  Partnership's  aircraft  to  Nations  Air
Express, Inc. (Nations Air) through February 1998. Payments from Nations Air are
paid directly to the Partnership.  In addition to the two spare engines on lease
to  Viscount,  one spare  engine was sold to  Viscount  in  November  1995.  The
Partnership  agreed to accept payment of the sales price of  approximately  $0.5
million with interest in monthly installments through July 2000. The Partnership
recorded a note receivable for the sales price,  which is secured by the engine.
The payments on the engine finance sale note  receivable  from Viscount are also
currently  in  default.  All  payments,  whether due from  Viscount  directly or
indirectly from Nations Air, may be affected by Viscount's filing for protection
under chapter 11.                                                               

As of December 31, 1995,  the  Partnership  recognized  rent,  loan and interest
receivables from Viscount  aggregating  approximately $1.8 million. In addition,
delinquent  maintenance reserves due from Viscount aggregate  approximately $0.3
million as of December  31, 1995 for a total of  approximately  $2.1  million in
outstanding  obligations.  As previously discussed, the engine finance sale note
receivable,  the balance of which at December  31, 1995 was  approximately  $0.5
million, is secured by the engine. The balance of the line of credit advanced to
Viscount  in  1994  of  approximately  $0.3  million  at  December  31,  1995 is
guaranteed by certain affiliates of the principal  shareholder of Viscount.  The
Partnership  has  recorded  an  allowance  for credit  losses for the  remaining
unsecured receivable balances from Viscount of approximately $1.0 million in the
December 31, 1995 financial statements to be presented in the Partnership's 1995
Annual  Report to the  Securities  and  Exchange  Commission  on Form 10-K.  The
Partnership  has received no additional  payments  from  Viscount  subsequent to
December 31, 1995.                                                              

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 SIGNATURE

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.                                          

                                    POLARIS AIRCRAFT INCOME FUND I
                  (Registrant)
                             By:  Polaris Investment
                                       Management Corporation,
                               General Partner

February 7, 1996                   By: /S/Marc A. Meiches       
---------------------------------              ------------------               
                             Marc A. Meiches
                                     Chief Financial Officer
                                              (principal financial officer and
                                             principal accounting officer of
                                           Polaris Investment Management
                                             Corporation, General Partner of
                             the Registrant)

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Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on:		2/8/96
		2/7/96		3
For Period End:		1/24/96		1		2
		1/9/96		2
		12/31/95		2					10-K
		12/13/95		2
		9/30/95		2					10-Q
									List all Filings