UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange act of 1934 For the quarterly period ended
September 30, 1996.
Commission file number: (S-1) 333-3084
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
RIFKIN ACQUISITION CAPITAL CORP.
Colorado 84-1317717
Colorado 84-1341424
360 South Monroe St., Suite 600
Denver, Colorado 80209
(303) 333-1215
Indicate 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
<PAGE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
RIFKIN ACQUISITION CAPITAL CORP.
INDEX
Page Number
Part I. Financial Information:
Item 1. Financial Statements:
Rifkin Acquisition Partners, L.L.L.P.
a. Consolidated Statement of Operations............... 3
b. Consolidated Balance Sheet......................... 5
c. Consolidated Statement of Cash Flows............... 7
d. Consolidated Statement of Partners' Capital
(Deficit).......................................... 9
e. Notes to Consolidated Financial Statements......... 11
Rifkin Acquisition Capital Corp.
a. Balance Sheet...................................... 14
b. Notes to Balance Sheet............................. 15
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations................... 16
Part II: Other Information:
Item 1. Legal Proceedings--(none)
Item 2. Changes in Securities--(none)
Item 3. Defaults Upon Senior Securities--(none)
Item 4. Submission of Matters to a Vote of Security
Holders--(none)
Item 5. Other Information:
a. Revenue and Operating Cash Flow Report............. 24
Item 6. Exhibits and Reports on Form 8-K--(none)
Signatures..................................................... 26<PAGE>
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
<CAPTION>
Three Months Ended
September 30,
---------------------------
1995(a) 1996
----------- -----------
<S> <C> <C>
REVENUE:
Service................................ $11,998,937 $17,498,967
Installation and other................. 754,430 1,146,782
----------- -----------
Total revenue 12,753,367 18,645,749
COSTS AND EXPENSES:
Operating Expense...................... 1,750,310 2,695,345
Programming Expense.................... 2,579,697 3,837,395
Selling, general and administrative
expense.............................. 1,799,779 2,891,333
Depreciation and amortization.......... 6,050,011 9,331,709
Management Fees........................ 446,340 652,602
Loss on disposal of assets............. 131,691 195,360
----------- -----------
Total costs and expenses......... 12,757,828 19,603,744
Operating income (loss)................ (4,461) (957,995)
Interest expense....................... 3,162,725 5,501,220
----------- -----------
Loss before income taxes............... (3,167,186) (6,459,215)
Income tax benefit..................... (399,000) (783,719)
----------- -----------
Net loss............................... $(2,768,186) $(5,675,496)
=========== ===========
OTHER FINANCIAL DATA:
Adjusted EBITDA........................ $ 6,177,241 $ 8,744,073
=========== ===========
<FN>
(a) 1995 has been reflected on a pro forma basis to account for the
recapitalization discussed in Note 1.
See accompanying notes to financial statements.<PAGE>
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
<CAPTION>
Nine months Ended
September 30,
---------------------------
1995(a) 1996
----------- ------------
<S> <C> <C>
Revenue:
Service................................ $34,984,274 $ 48,764,840
Installation and other................. 2,172,711 3,667,296
----------- ------------
Total revenue 37,156,985 52,432,136
----------- ------------
Costs and Expenses:
Operating Expense...................... 5,313,328 7,591,555
Programming Expense.................... 7,532,853 10,813,312
Selling, general and administrative
expense.............................. 5,153,470 7,734,856
Depreciation and amortization.......... 18,064,468 25,858,464
Management Fees........................ 1,300,374 1,815,516
Loss on disposal of assets............. 264,742 784,618
----------- ------------
Total costs and expenses......... 37,629,235 54,598,321
----------- ------------
Operating loss......................... (472,250) (2,166,185)
Interest expense....................... 9,472,943 16,094,577
----------- ------------
Loss before income taxes............... (9,945,193) (18,260,762)
Income tax benefit..................... (1,253,000) (2,554,719)
----------- ------------
Net loss............................... $(8,692,193) $(15,706,043)
=========== ============
OTHER FINANCIAL DATA:
Adjusted EBITDA........................ $17,856,960 $ 24,441,629
=========== ============
<FN>
(a) 1995 has been reflected on a pro forma basis to account for the
recapitalization discussed in Note 1.
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
CONSOLIDATED BALANCE SHEET
<CAPTION>
ASSETS
December 31, September 30,
1995 1996
(UNAUDITED)
------------ ------------
<S> <C> <C>
Cash................................... $ 318,020 $ 1,243,117
Subscriber accounts receivable,
net of allowance for doubtful
accounts of $292,626 in 1995
and $337,800 in 1996............... 884,908 1,054,397
Other receivables...................... 1,542,667 2,156,141
Prepaid expenses and other............. 924,229 1,549,287
Property, plant and equipment at cost:
Cable television transmission and
distribution systems and related
equipment.......................... 73,994,528 107,194,770
Land, building, vehicles and
furniture and fixtures............. 3,159,116 5,387,434
------------ ------------
77,153,644 112,582,204
Less accumulated depreciation.......... (2,741,453) (11,152,610)
------------ ------------
Net property, plant and equipment 74,412,191 101,429,594
Franchise costs and other intangible
assets, net of accumulated
amortization of $5,128,754 in 1995
and $22,457,616 in 1996.............. 159,963,395 196,610,720
------------ ------------
Total assets................. $238,045,410 $304,043,256
============ ============
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND PARTNERS' CAPITAL
<S> <C> <C>
Accounts payable and accrued
liabilities.......................... $ 5,867,584 $ 9,298,005
Subscriber deposits and prepayments.... 961,528 1,103,044
Interest payable....................... 91,273 3,286,225
Deferred taxes payable................. 21,127,000 18,564,000
Notes payable.......................... 137,500,000 200,000,000
------------ ------------
Total liabilities............. 165,547,385 232,251,274
Commitments
Redeemable partners' interests....... 3,600,000 4,540,000
Partners' capital (deficit):
General partner...................... (1,085,311) (1,209,872)
Limited partners..................... 69,421,043 67,993,797
Preferred equity interest............ 562,293 468,057
------------ ------------
Total partners' capital...... 68,898,025 67,251,982
------------ ------------
Total liabilities and
partners' capital.......... $238,045,410 $304,043,256
============ ============
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
CONSOLIDATED BALANCE SHEET (UNAUDITED)
<CAPTION>
ASSETS
9/30/95 9/30/96
------------- -------------
<S> <C> <C>
Cash.................................... $ 664,115 $ 1,243,117
Subscriber accounts receivable,
net of allowance for doubtful
accounts of $275,603 in 1995
and $337,800 in 1996.................. 746,647 1,054,397
Other receivables....................... 1,363,486 2,156,141
Prepaid expenses and other.............. 1,092,905 1,549,287
Property, plant and equipment at cost:
Cable television transmission and
distribution systems and related
equipment........................... 71,917,902 107,194,770
Land, building, vehicles and
furniture and fixtures.............. 2,851,055 5,387,434
------------ ------------
74,768,957 112,582,204
Less accumulated depreciation........... (669,520) (11,152,610)
------------ ------------
Net property, plant and
equipment.................... 74,099,437 101,429,594
Franchise costs and other intangible
assets, net of accumulated
amortization of $1,337,280 in 1995
and $22,457,616 in 1996............... 163,271,453 196,610,720
------------ ------------
Total assets................... $241,238,043 $304,043,256
============ ============
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND PARTNERS' CAPITAL
<S> <C> <C>
Accounts payable and accrued
liabilities........................... $ 4,908,531 $ 9,298,005
Subscriber deposits and prepayments..... 1,086,653 1,103,044
Interest payable........................ 59,603 3,286,225
Deferred taxes payable.................. 22,801,000 18,564,000
Notes payable........................... 138,000,000 200,000,000
------------ ------------
Total liabilities.............. 166,855,787 232,251,274
Commitments
Redeemable partners' interests and
detachable warrants................... 3,600,000 4,540,000
Partners' capital (deficit):
General partner....................... (1,066,469) (1,209,872)
Limited partners...................... 71,273,242 67,993,797
Preferred equity interest............. 575,483 468,057
------------ ------------
Total partners' capital........ 70,782,256 67,251,982
------------ ------------
Total liabilities and partners'
capital...................... $241,238,043 $304,043,256
============ ============
<FN>
See accompanying notes to financial statements.<PAGE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED STATEMENT OF CASH FLOW (UNAUDITED)
<CAPTION>
Three Months Ended
September 30,
-------------------------------
1995(a) 1996
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net loss................................. $(2,768,186) $(5,675,496)
Adjustments to reconcile net loss to
net cash provided by operating
activities:
Depreciation and amortization........ 6,050,011 9,331,709
Amortization of deferred loan cost... 97,457 247,247
Loss on disposal of fixed assets..... 131,691 195,360
Decrease in subscriber
accounts receivable................ 182,068 30,586
Increase in other receivables........ (1,103,971) (397,101)
Increase in prepaid
expenses and other................. (255,360) (554,719)
Increase in accounts
payable and accrued liabilities.... 827,189 594,690
Decrease in subscriber
deposits and prepayments........... (278,119) (21,922)
Decrease in deferred taxes payable... (399,000) (784,000)
Increase (decrease) in interest
payable............................ 232,409 (2,893,142)
----------- -----------
Net cash provided by operating
activities................... 2,716,189 73,212
Cash flows from investing activities:
Additions to property, plant and
equipment.............................. (1,569,644) (5,296,563)
Additions to cable television
franchises, net of retirements
and changes in other intangible
assets................................. 210,789 (210,120)
Net proceeds from the sale of assets..... 13,608 49,883
----------- -----------
Net cash used in investing
activities...................... (1,345,247) (5,456,800)
Cash flows from financing activities:
Proceeds from long-term bank debt........ 3,000,000 7,500,000
Deferred loan costs...................... - (89,347)
Payments of long-term bank debt.......... (3,000,000) (2,500,000)
----------- -----------
Net cash provided by
financing activities............ - 4,910,653
----------- -----------
Net increased (decrease) in cash......... 1,370,942 (472,935)
Cash at beginning of quarter............. 1,290,910 1,716,052
----------- -----------
Cash at end of quarter................... $ 2,661,852 $ 1,243,117
=========== ===========
<FN>
(a) 1995 has been reflected on a pro forma basis to account for the recapitalization
discussed in Note 1.
See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
CONSOLIDATED STATEMENT OF CASH FLOW (UNAUDITED)
<CAPTION>
Nine Months Ended
September 30,
1995(a) 1996
----------- ------------
<S> <C> <C>
Cash flows from operating activities:
Net loss.................................... $(8,692,193) $(15,706,043)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Depreciation and amortization............. 18,064,468 25,858,464
Amortization of deferred loan cost........ 306,551 723,313
Loss on disposal of fixed assets.......... 264,742 784,618
Decrease (increase) in subscriber
accounts receivable..................... 154,252 (169,489)
Increase in other
receivables............................. (1,003,783) (613,474)
Increase in prepaid
expenses and other...................... (24,843) (625,058)
Increase in accounts
payable and accrued liabilities......... 181,542 3,430,421
Increase in subscriber deposits
and prepayments......................... 53,571 141,516
Decrease in deferred taxes payable........ (1,253,000) (2,563,000)
Increase in interest payable.............. 429,445 3,194,952
Net cash provided by operating ----------- ------------
activities........................... 8,480,752 14,456,220
Cash flows from investing activities:
Acquisition of Mid-Tennessee Systems........ - (61,804,006)
Acquisition of RCT Systems.................. - (10,159,342)
Additions to property, plant and
equipment................................. (4,835,159) (12,392,908)
Additions to cable television
franchises, net of retirements
and changes in other intangible
assets.................................... 29,087 (708,026)
Net proceeds from the sale of assets........ 40,521 116,132
Net cash used in investing ----------- ------------
activities......................... (4,765,551) (84,948,150)
Cash flows from financing activities:
Proceeds from issuance of senior
subordinated notes........................ - 125,000,000
Proceeds from long-term bank debt........... 7,000,000 17,000,000
Deferred loan costs......................... - (6,082,973)
Payments of long-term bank debt............. (9,250,000) (79,500,000)
Partners' capital contributions............. - 15,000,000
Net cash provided by (used in) ----------- ------------
financing activities............... (2,250,000) 71,417,027
----------- ------------
Net increase in cash........................ 1,465,201 925,097
Cash at beginning of period................. 1,196,651 318,020
----------- ------------
Cash at end of period....................... $ 2,661,852 $ 1,243,117
=========== ============
<FN>
(a) 1995 has been reflected on a pro forma basis to account for the recapitalization
discussed in Note 1.
See accompanying notes to financial statement RIFKIN ACQUISITION PARTNERS, L.L.L.P.
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.P.
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL(DEFICIT)
(UNAUDITED)
Three Months Ended September 30, 1995 and 1996
<CAPTION>
Preferred
Equity General Limited
Interest Partner Partners Total
--------- ------------ ------------- ------------
Two Months Ended 8/31/95
- ------------------------
<S> <C> <C> <C> <C>
Beginning balance at 7/1/95.. $ - $ (604,388) $(89,469,106) $(90,073,494)
Net loss for the two months
ended 8/31/95.............. - (26,903) (2,663,389) (2,690,292)
--------- ------------ ------------ ------------
Balance at 8/31/95........... $ - $ (631,291) $(92,132,495) $(92,763,786)
========= ============ ============ ===========
One Month Ended 9/30/95
- -----------------------
Beginning balance at 9/1/95.. $ - $ - $ - $ -
Net loss for the one month
ended 9/30/95.............. (7,629) (10,899) (1,071,330) (1,089,858)
Partnership contributions.... 583,112 (605,570) 75,494,572 75,472,114
Transfer to Redeemable
Partners' Interest......... - (450,000) (3,150,000) (3,600,000)
--------- ------------ ----------- ------------
Balance at 9/30/95........... $ 575,483 $ (1,066,469) $71,273,242 $ 70,782,256
========= =========== ============ ============
Three Months Ended 9/30/96
- --------------------------
Beginning Balance at 7/1/96.. $ 502,110 $(1,114,617) $73,847,985 $ 73,235,478
Net loss for the three months
ended 9/30/96.............. (34,053) (56,755) (5,584,688) (5,675,496)
Transfer to Redeemable
Partners' Interest......... - (38,500) (269,500) (308,000)
---------- ----------- ------------ ------------
Balance at 9/30/96........... $ 468,057 $(1,209,872) $67,993,797 $ 67,251,982
========== =========== ============ ============
<FN>
See accompanying notes to financial statement.
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
RIFKIN ACQUISITION PARTNERS, L.P.
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL(DEFICIT)
(UNAUDITED)
Nine Months Ended September 30, 1995 and 1996
<CAPTION>
Preferred
Equity General Limited
Interest Partner Partners Total
---------- ------------- ------------- ------------
<S> <C> <C> <C> <C>
Eight Months Ended 8/31/95
- --------------------------
Beginning balance at 1/1/95.. $ - $ (554,220) $(84,502,476) $(85,056,696)
Net loss for the eight months
ended 8/31/95.............. - (77,071) (7,630,019) (7,707,090)
--------- ------------ ------------- ------------
Balance at 8/31/95........... - $ (631,291) $(92,132,495) $(92,763,786)
========= =========== ============ ============
One Month Ended 9/30/95
- -----------------------
Beginning balance at 9/1/95.. $ - $ - $ - $ -
Net loss for the one month
ended 9/30/95.............. (7,629) (10,899) (1,071,330) (1,089,858)
Partnership contributions.... 583,112 (605,570) 75,494,572 75,472,114
Transfer to Redeemable
Partners' Interest......... - (450,000) (3,150,000) (3,600,000)
--------- ----------- ------------ ------------
Balance at 9/30/95........... $ 575,483 $(1,066,469) $ 71,273,242 $ 70,782,256
========= =========== ============ ============
Nine Months Ended 9/30/96
- -------------------------
Beginning balance at 1/1/96.. $ 562,293 $(1,085,311) $ 69,421,043 $ 68,898,025
Net loss for the nine months
ended 9/30/96.............. (94,236) (157,061) (15,454,746) (15,706,043)
Partners' contributions...... - 150,000 14,850,000 15,000,000
Transfer to Redeemable
Partners' Interest......... - (117,500) (822,500) (940,000)
--------- ----------- ------------ ------------
Balance at 9/30/96........... $ 468,057 $(1,209,872) $ 67,993,797 $ 67,251,982
========= =========== ============ ============
<FN>
See accompanying notes to financial statement.
</TABLE>
<PAGE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND TRANSFER OF NET ASSETS
Rifkin Acquisition Partners, L.P. ("RAP L.P.") was formed on December
16, 1988, pursuant to the laws of the State of Colorado, for the purpose
of acquiring and operating cable television (CATV) systems. On
September 1, 1995, RAP L.P. registered as a limited liability limited
partnership, Rifkin Acquisition Partners, L.L.L.P. (the "Partnership"),
pursuant to the laws of the State of Colorado. Rifkin Acquisition
Management, L.P., was the general partner of RAP L.P. and is the general
partner of the Partnership ("General Partner"). The Partnership and its
subsidiaries are hereinafter referred to on a consolidated basis as the
"Company."
The Partnership operates under a limited liability limited partnership
agreement (the "Partnership Agreement") which establishes contribution
requirements, enumerates the rights and responsibilities of the partners
and advisory committee, provides for allocations of income, losses and
distributions, and defines certain items relating thereto.
On September 1, 1995, unrelated third party investors purchased the
interest of certain limited partners in RAP L.P. and contributed
additional equity for an approximate 89% limited partner interest. In
addition, existing RAP L.P. limited and general partner interests were
carried over and additional equity contributed for 10% and 1%,
respectively (the "Carryover Interests"). Further, on September 1,
1995, RAP L.P. was renamed Rifkin Acquisition Partners, L.L.L.P. and a
new basis of accounting was established.
This form 10-Q is being filed in conformity with the SEC requirements
for unaudited consolidated financial statements for the Company and does
not contain all of the necessary footnote disclosures required for a
fair presentation of the balance sheets, statements of operations, of
partners' capital(deficit), and of cash flows in conformity with
generally accepted accounting principles. However, in the opinion of
management, this data includes all adjustments, consisting only of
normal recurring accruals, necessary to present fairly the Company's
consolidated financial position at September 30, 1996, and its
consolidated results of operations and cash flows for the three months
and nine months ended September 30, 1995 and 1996. As a result of the
recapitalization of the Company, the consolidated statements of
operations and cash flows for the three months and nine months ended
September 30, 1995 are shown on a pro forma basis to reflect the
recapitalization as if it had occurred on December 31, 1994. The
consolidated financial statements should be read in conjunction with the
Company's annual consolidated financial statements and notes thereto
included on Form S-1, No. 333-3084, for the year ended December 31,
1995. The results of operations for the three months and nine months
ended September 30, 1996 may not be indicative of the results for the
year ending December 31, 1996.
2. ACQUISITION OF CABLE PROPERTIES
On March 1, 1996, the Company acquired certain cable operating assets
("Mid-Tennessee Systems") from Mid-Tennessee CATV, L.P., and on April 1,
1996 acquired certain cable operating assets ("RCT Systems") from Rifkin
Cablevision of Tennessee, Ltd. Both Mid-Tennessee CATV, L.P. and Rifkin
Cablevision of Tennessee, Ltd. are affiliates of the General Partner.
The acquisition costs were funded by $15 million of additional partner
contributions and the remainder from a portion of the proceeds received
from the issuance of $125 million of 11 1/8% Senior Subordinated Notes
due 2006 (see note 3).
The acquisitions were accounted for using the purchase method of
accounting. The results of operations of the Mid-Tennessee Systems have
been included in the consolidated financial statements since March 1,
1996, and the results of the RCT Systems have been included in the
consolidated financial statements since April 1, 1996. The purchase
price of each was allocated, based on estimated fair values from an
independent appraisal, to property, plant and equipment and franchise
cost as follows (dollars in thousands):
Mid-Tennessee RCT
Systems Systems
-------------- -------
Cash paid.............................. $61,715 $ 9,756
Acquisition costs (appraisal, transfer
fees, and other direct costs).......... 92 27
Working capital assumed................ (3) 376
------- -------
Total acquisition cost................. $61,804 $10,159
======= =======
Allocation:
Property, plant and equipment.......... $18,046 $5,986
Franchise cost and other intangible
assets................................. 43,758 4,173
------- -------
Total cost allocated................... $61,804 $10,159
======= =======
2. ACQUISITION OF CABLE PROPERTIES (continued)
The following unaudited pro forma information presents a summary of
consolidated results of operations for the Company as if the Mid-Tennessee
and RCT Systems acquisition had occurred at the beginning of 1995, with
pro forma adjustments to show the effect on depreciation and amortization
for the acquired assets, management fees on additional revenues and
interest expense on additional debt (dollars in thousands):
Three Months Ended Nine months Ended
September 30 September 30
--------------------- -----------------
1995 1996 1995 1996
--------------------- -----------------
Total revenues....... $16,651 $18,645 $48,518 $55,492
Net Loss........... (6,430) (5,675) (18,942) (16,632)
The pro forma financial information is not necessarily indicative of the
operating results that would have occurred had the Mid-Tennessee Systems
and the RCT Systems actually been acquired on January 1, 1995.
3. Senior Subordinated Notes
On January 26, 1996, the Company and its wholly-owned subsidiary, Rifkin
Acquisition Capital Corp (RAC), co-issued a $125 million aggregate
principal amount of 11 1/8% Senior Subordinated Notes ("the Notes") to
institutional investors. On May 13, 1996, these notes were registered
with the Securities and Exchange Commission. The note exchange was
completed on June 18, 1996. Interest on the Notes is payable in cash,
semi-annually on January 15 and July 15 of each year, commencing on July
15, 1996. The Notes, which mature on January 15, 2006, can be redeemed in
whole or in part, at the Issuers' option, at any time on or after January
15, 2001, at redeemable prices contained in the Notes plus accrued
interest. In addition, at any time on or prior to January 15, 1999, the
Issuers, at their option, may redeem up to 25% of the principle amount of
the notes issued to institutional investors of not less than $25 million.
At September 30, 1996, the Senior Subordinated Notes had a balance of $125
million.
<TABLE>
RIFKIN ACQUISITION CAPITAL CORP.
BALANCE SHEET (UNAUDITED)
September 30, 1996
<CAPTION>
ASSETS
------
<S> <C>
Cash................................................................ $1,000
------
Total Assets.................................................. $1,000
======
STOCKHOLDER'S EQUITY
--------------------
Stockholder's Equity
Common Stock; $1.00 par value; 10,000 shares authorized,
1000 shares issued and outstanding.......................... $1,000
------
Total Stockholder's equity................................ $1,000
======
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
RIFKIN ACQUISITION CAPITAL CORP.
NOTES TO BALANCE SHEET
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Rifkin Acquisition Capital Corp. ("RAC"), a Colorado corporation, was
formed on January 24, 1996, as a wholly-owned subsidiary of Rifkin
Acquisition Partners, L.L.L.P. (the "Partnership") for the purpose of co-
issuing, with the Partnership, $125.0 million in Senior Subordinated Notes
("the Notes") used to repay advances under the Partnership's term debt and
to fund the Partnership's expected acquisitions of certain cable
television systems. Although the Notes were structured to be co-issued,
Notes were not issued by RAC. RAC does not and is not expected to have
operations other than that which is related to its purpose as co-issuer.<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
In August 1995, Rifkin Acquisition Partners, L.L.L.P. (the "Company")
effected a recapitalization in which a group led by VS&A Communications
Partners II, L.P. and further comprised of Greenwich Street (RAP) Partners
I, L.P., IEP Holdings I LLC and Paine Webber Capital, Inc. acquired the
interests of certain limited partners in Rifkin Acquisition Partners, L.P.
(the "Predecessor"). Concurrently, all of the Predecessor's debt was
repaid and the Company entered into a new credit agreement (the "Credit
Agreement") with a syndicate of banks. In addition, in January 1996, the
Company completed the issuance of $125 million of 11 1/8% Senior
Subordinated Notes due 2006 ("Notes") and amended its Credit Agreement to
provide ongoing borrowing availability, including availability to finance
acquisitions.
The recapitalization was accounted for using the purchase method of
accounting, resulting in the restatement of the Company's assets and
liabilities to fair market value as of September 1, 1995. In the
discussion of operations which follows, the Company's results of
operations for the three months and nine months ended September 30, 1995
are reflected on a pro forma basis to account for the recapitalization as
if it had occurred on December 31, 1994.
Three months ended September 30, 1996 compared to
pro forma three months ended September 30, 1995
Revenue increased 46.2%, or approximately $5.9 million, to approximately
$18.6 million for the three months ended September 30, 1996 from
approximately $12.8 million for the three months ended September 30, 1995.
This increase resulted from the following: (a) approximately $1.5 million
from growth in basic customers and increases in basic and tier rates, (b)
approximately $3.3 million in total revenue as a result of the March 1,
1996 acquisition of cable systems serving Hickory Hill, Lebanon and
McMinnville, Tennessee (the "Mid-Tennessee Acquisition"), and (c)
approximately $1.1 million in total revenue as a result of the April 1,
1996 acquisition of cable systems serving Fayetteville, Lawrenceburg and
Pulaski, Tennessee (the "RCT Acquisition"). Basic customers increased
40.6% to approximately 183,000 at September 30, 1996 from approximately
130,300 at September 30, 1995. This increase was attributable to the
approximate 33,500 customers acquired in the Mid-Tennessee Acquisition,
the approximate 12,200 customers acquired in the RCT Acquisition, along
with the continued growth in the Georgia (4,600) and Tennessee (1,100)
systems. Average monthly revenue per customer increased 3.2% from $33.05
for the three months ended September 30, 1995 to $34.12 for 1996. Premium
service units increased 33.9% to 107,300 as of September 30, 1996, from
80,100 as of September 30, 1995, largely as a result of the Mid-Tennessee
Acquisition (20,900) and the RCT Acquisition (6,900). The Company's
premium penetration decreased to 58.6% from 61.5% between the comparable
periods in 1996 and 1995 due mainly to decreased premium penetrations in
Tennessee as a result of moving the Disney Channel from premium to tier in
certain of its systems.
Operating expense, which includes costs related to technical personnel,
franchise fees and repairs and maintenance, increased 54.0%, or
approximately $1.0 million to approximately $2.7 million for the three
months ended September 30, 1996 from approximately $1.7 million in 1995,
and increased as a percentage of revenue to 14.5% from 13.7%.
Approximately $500,000 and $200,000 of the increase relates to the
operating expense of the acquired systems in the Mid-Tennessee Acquisition
and RCT Acquisition, respectively.
Programming expense, which includes costs related to basic, tier and
premium services, increased 48.8%, or approximately $1.3 million, to
approximately $3.8 million for the three months ended September 30, 1996
from approximately $2.6 million for the three months ended September 30,
1995, and increased as a percentage of revenue to 20.6% from 20.2%.
Approximately $700,000 and $300,000 of the increase relates to the
programming expenses of the acquired systems in the Mid-Tennessee
Acquisition and RCT Acquisition, respectively.
Selling, general and administrative expense, which includes expenses
related to on-site office and customer-service personnel, customer billing
and postage and marketing, increased 60.6%, or approximately $1.1 million
to approximately $2.9 million for the three months ended September 30,
1996 from $1.8 million for the same period in 1995. As a percentage of
revenue, selling, general and administrative expense increased to 15.5%
for the three months ended September 30, 1996 from 14.2% for the same
period in 1995. Approximately $200,000 of the increase resulted from the
provision for the management incentive plan which became effective January
1, 1996 and approximately $100,000 of the increase resulted from increases
in personnel and related benefits costs, as well as increased customer
billing costs, while approximately $500,000 and $200,000 related to the
selling, general and administrative expense of the acquired systems in the
Mid-Tennessee Acquisition and RCT Acquisition, respectively.
Depreciation and amortization expense of approximately $9.3 million for
the three months ended September 30, 1996 increased approximately $3.3
million from pro forma depreciation and amortization expense for the same
period in 1995. The increases in depreciation resulted primarily from
increases of approximately $1.6 million in the third quarter of 1995 and
approximately $5.3 million in the comparable period in 1996 in property,
plant and equipment. The increases in amortization expense resulted
primarily from the additional amortization related to the Mid-Tennessee
Acquisition and RCT Acquisition, respectively. As a percentage of
revenue, depreciation and amortization expenses increased to 50.0% in the
third quarter of 1996 from 47.4% in the comparable period in 1995.
Management fees, equal to 3.5% of gross revenue, increased to
approximately $700,000 in the third quarter of 1996 from pro forma
management fees of approximately $400,000 in the comparable period of
1995, due to the increase in the Company's revenue as a result of rate
increases as well as the Mid-Tennessee Acquisition and RCT Acquisition,
respectively.
The loss on disposal of assets, primarily the write-off of replaced house
drops and rebuilt trunk and distribution equipment, increased to
approximately $200,000 in the third quarter of 1996 from approximately
$100,000 in the third quarter of 1995.
Interest expense in the third quarter of 1996 increased by approximately
$2.3 million or 73.9% over pro forma interest for the same period in 1995
and increased as a percentage of revenue from 24.8% to 29.5%. Interest
expense was based on an average debt balance of $199.0 million with an
average interest rate of 11.1% and an average debt balance $138.0 million
with an average interest rate of 9.2% for the third quarters of 1996 and
1995, respectively. This increase was primarily a result of the issuance
of the Notes on January 26, 1996 with proceeds being held in escrow until
March 1, 1996, pending the completion of the Mid-Tennessee Acquisition.
The release of the Note proceeds from escrow resulted in the reduction of
the revolver portion of the Credit Agreement by approximately $66.0
million.
The Company is a "pass-through" entity for income tax purposes. All
income or loss flows through to the partners of the Company in accordance
with the Partnership Agreement. An income tax benefit of approximately
$800,000 was recorded for the three months ended September 30, 1996
compared to an income tax benefit of approximately $400,000 for the
comparable period in 1995 on a pro forma basis and relates to deferred
income taxes recorded as a result of the non-cash tax liability of the
Company's corporate subsidiaries in conjunction with the application of
Financial Accounting Standard No. 109 (FAS 109), "Accounting for Income
Taxes."
As a result of the factors discussed above, net loss increased 105.0%, or
approximately $2.9 million in the three months ended September 30, 1996
compared to the comparable period of 1995.
Adjusted EBITDA, defined as income (loss) before interest expense, income
taxes, depreciation and amortization, loss on disposal of assets, non-
recurring interest income (related to the escrowed Notes proceeds) and the
non-cash provision for the management incentive plan increased 41.6%, or
approximately $2.6 million, to approximately $8.7 million in 1996 from a
pro forma $6.2 million in 1995. As a percentage of revenue, Adjusted
EBITDA decreased to 46.9% in the third quarter of 1996 from 48.4% in the
comparable period in 1995 as the impact of the Company's percentage
expense growth out paced the percentage revenue growth. Industry analysts
generally consider Adjusted EBITDA to be an appropriate measure of the
performance of multi-channel television operations. Adjusted EBITDA is
not presented in accordance with generally accepted accounting principles
and should not be considered an alternative to, or more meaningful than,
operating income or operating cash flow as an indication of the Company's
operating performance.
Nine months ended September 30, 1996 compared to
pro forma nine months ended September 30, 1995
Revenue increased 41.1% or approximately $15.3 million, to approximately
$52.4 million for the nine months ended September 30, 1996 from
approximately $37.2 million for the nine months ended September 30, 1995.
This increase resulted from the following: (a) approximately $5.1 million
from growth in basic customers and increases in basic and tier rates, (b)
approximately $7.5 million as a result of the March 1, 1996 Mid-Tennessee
Acquisition, (c) approximately $2.1 million as a result of the April 1,
1996 RCT Acquisition, and (d) approximately $600,000 in non-recurring
interest income related to the escrowed Notes proceeds. Basic customers
increased 40.6% to approximately 183,100 at September 30, 1996 from
approximately 130,300 at September 30, 1995. This increase was
attributable to the approximate 33,500 customers acquired in the Mid-
Tennessee Acquisition, the approximate 12,200 customers acquired in the
RCT Acquisition, along with the continued growth in the Georgia (4,600)
and Tennessee (1,100) systems. Average monthly revenue per customers
increased 13.8% from $32.47 for the nine months ended September 30, 1995
to $36.94 for 1996. Premium service units increased 33.9% to 107,300 as
of September 30, 1996 from 80,100 as of September 30, 1995, largely as a
result of the Mid-Tennessee Acquisition (20,900)and the RCT Acquisition
(6,900). The Company's premium penetration decreased to 58.6% from 61.5%
between comparable periods in 1996 and 1995 due mainly to decreased
premium penetrations in Tennessee as a result of moving the Disney Channel
from premium to tier in certain of its systems.
Operating expense, which includes costs related to technical personnel,
franchise fees and repairs and maintenance, increased 42.9%, or
approximately $2.3 million to approximately $7.6 million for the nine
months ended September 30, 1996 from approximately $5.3 million in 1995,
and increased as a percentage of revenue to 14.5% from 14.3%.
Approximately $1.1 million and $300,000 of the increase relates to the
operating expense of the acquired systems in the Mid-Tennessee Acquisition
and RCT Acquisition, respectively.
Programming expense, which includes costs related to basic, tier and
premium services, increased 43.5%, or approximately $3.3 million, to
approximately $10.8 million for the nine months ended September 30, 1996
from approximately $7.5 million for the nine months ended September 30,
1995, and increased as a percentage of revenue to 20.6% from 20.3%. The
respective approximate amounts of $1.5 million and $600,000 of the
increase relates to the programming expenses of the acquired systems in
the Mid-Tennessee Acquisition and RCT Acquisition, respectively.
Selling, general and administrative expense, which includes expenses
related to on-site office and customer-service personnel, customer billing
and postage and marketing, increased 50.0%, or approximately $2.6 million,
to approximately $7.7 million for the nine months ended September 30, 1996
from $5.2 million for the same period in 1995. As a percentage of
revenue, selling, general and administrative expense increased to 14.8%
for the nine months ended September 30, 1996 from 13.9% for the same
period in 1995. Approximately $500,000 of the increase resulted from the
provision for the management incentive plan which became effective January
1, 1996 and approximately $300,000 of the increase resulted from increases
in personnel and related benefits costs, while approximately $1.1 million
and $400,000, related to the selling, general and administrative expense
of the acquired systems in the Mid-Tennessee Acquisition and RCT
Acquisition, respectively.
Depreciation and amortization expense of approximately $25.9 million for
the nine months ended September 30, 1996 increased approximately $7.8
million from pro forma depreciation and amortization expense for the same
period in 1995. The increases in depreciation resulted primarily from
increases of approximately $4.8 million in the first nine months of 1995
and approximately $12.4 million in the comparable period in 1996 in
property, plant and equipment. The increases in amortization expense
resulted primarily from the additional amortization related to the Mid-
Tennessee Acquisition and RCT Acquisition. As a percentage of revenue,
depreciation and amortization expenses increased to 49.3% in the first
nine months of 1996 from 48.6% in the comparable period in 1995.
Management fees, equal to 3.5% of gross revenue, increased to
approximately $1.8 million in the first nine months of 1996 from pro forma
management fees of approximately $1.3 million in the comparable period of
1995, due to the increase in the Company's revenue as a result of rate
increases as well as the Mid-Tennessee Acquisition and RCT Acquisition.
The loss on disposal of assets, primarily the write-off of replaced house
drops and rebuilt trunk and distribution equipment, increased to
approximately $800,000 in the first nine months of 1996 from approximately
$300,000 in the first nine months of 1995.
Interest expense in the first nine months of 1996 increased by
approximately $6.6 million or 69.9% over pro forma interest for the same
period in 1995 and increased as a percentage of revenue from 25.5% to
30.7%. Interest expense was based on an average debt balance of
approximately $204.2 million with an average interest rate of 10.5% and an
average debt balance of $138.0 million with an average interest rate of
9.2% for the first nine months of 1996 and 1995, respectively. This
increase was primarily a result of the issuance of the Notes on January
26, 1996 with proceeds being held in escrow until March 1, 1996, pending
the completion of the Mid-Tennessee Acquisition. The release of the Note
proceeds from escrow resulted in the reduction of the revolver portion of
the Credit Agreement by approximately $66.0 million.
The Company is a "pass-through" entity for income tax purposes. All
income or loss flows through to the partners of the Company in accordance
with the Partnership Agreement. An income tax benefit of approximately
$2.6 million was recorded for the nine months ended September 30, 1996
compared to an income tax benefit of approximately $1.3 million for the
comparable period in 1995 on a pro forma basis and relates to deferred
income taxes recorded as a result of the non-cash tax liability of the
Company's corporate subsidiaries in conjunction with the application of
Financial Accounting Standard No. 109 (FAS 109), "Accounting for Income
Taxes."
As a result of the factors discussed above, net loss increased 80.7%, or
approximately $7.0 million in the nine months ended September 30, 1996
compared to the comparable period of 1995.
Adjusted EBITDA, defined as income (loss) before interest expense, income
taxes, depreciation and amortization, loss on disposal of assets, non-
recurring interest income (related to the escrowed Notes proceeds) and the
non-cash provision for the management incentive plan increased 36.9%, or
approximately $6.6 million, to approximately $24.4 million in 1996 from a
pro forma $17.9 million in 1995. As a percentage of revenue, Adjusted
EBITDA decreased to 46.6% in the first nine months of 1996 from 48.1% in
the comparable period in 1995 as the impact of the Company's percentage
expense growth slightly out paced the percentage revenue growth. Industry
analysts generally consider Adjusted EBITDA to be an appropriate measure
of the performance of multi-channel television operations. Adjusted
EBITDA is not presented in accordance with generally accepted accounting
principles and should not be considered an alternative to, or more
meaningful than, operating income or operating cash flow as an indication
of the Company's operating performance.
LIQUIDITY AND CAPITAL RESOURCES
The Company has relied upon cash generated by operations, borrowing and
equity contributions to fund capital expenditures and acquisitions,
service its indebtedness and finance its working capital needs. During
the comparable three month periods ended September 30, 1996 and 1995, net
cash provided by operations (including changes in working capital) of the
Company was approximately $100,000 and $2.7 million, respectively. During
the comparable nine month periods ended September 30, 1996 and 1995, net
cash provided by operations (including changes in working capital) of the
Company was approximately $14.5 million and $8.5 million, respectively.
From December 31, 1995, the Company's available cash increased from
approximately $300,000 to approximately $1.2 million. For the same
comparable dates, accounts payable and accrued liabilities increased by
approximately $3.4 million to approximately $9.3 million, due primarily to
the liabilities and accruals related to the systems acquired in the Mid-
Tennessee and RCT Acquisitions. Interest payable increased from
approximately $100,000 to approximately $3.3 million for the same
comparable dates due primarily to the increased debt level as well as the
effect of the timing of payments. Also, for the same comparable dates,
deferred taxes payable decreased approximately $2.6 million to
approximately $18.6 million as a result of differences in book and tax
depreciation and amortization lives and methods. Notes payable increased
by $62.5 million from December 31, 1995 to September 30, 1996 due to the
January 26, 1996 issuance of the Notes offset by the paydown of the
revolver portion of the Credit Agreement.
In order to improve liquidity and increase financial flexibility, the
Company completed its recapitalization in August 1995. In connection with
the recapitalization, the Company obtained $41.6 million in new equity,
made initial borrowings of $138 million under the Credit Facility and
assumed $3 million of subordinated debt. The proceeds of such debt and
equity financings were used to refinance or repay all of the Company's
indebtedness and provide ongoing liquidity for the Company.
Additionally, in conjunction with the issuance of the Notes, the partners
of the Company contributed an additional $15 million of equity.
The Company has increased its total consolidated debt to $200 million as
of September 30, 1996 from $137.5 million at December 31, 1995. The
Company has unused commitments under the Amended and Restated Credit
Agreement of $73.0 million, $13.0 million of which is available for
general corporate purposes. Access to the remaining $60 million of
availability under the Amended and Restated Credit Agreement for general
corporate purposes or Permitted Acquisitions (as defined in the Amended
and Restated Credit Agreement) is subject to the Company's compliance with
all covenants in such facility and the Company's Total Funded Debt Ratio
(defined as the ratio of funded indebtedness of the Company to annualized
Adjusted EBITDA based on the most recent quarter) being below 6.25x. As
of September 30, 1996, the Company's Total Funded Debt Ratio was 5.75.
Interest payments on the Notes and interest and principal payments under
the Amended and Restated Credit Agreement represent significant liquidity
requirements for the Company. The Amended and Restated Credit Agreement
provides for two term loan facilities in a total amount of $65 million.
Term Loan A in the amount of $25 million, matures on March 31, 2003 and
begins amortizing on March 31, 2000. Term Loan B in the amount of $40
million, matures March 31, 2004 and begins amortizing March 31, 2002. The
Amended and Restated Credit Agreement also provides for an $80 million
reducing revolving facility with a final maturity date of March 31, 2003.
The revolving facility will be subject to permanent annual commitment
reductions commencing in 1997. Borrowings under the Amended and Restated
Credit Agreement will bear interest at floating rates and will require
interest payments on various dates depending upon the interest rate
options selected by the Company.
In addition to its debt service obligations, the Company will require
liquidity for capital expenditures and working capital needs. The cable
television business requires substantial financing for construction,
expansion and maintenance of plant and the Company has committed
substantial capital resources to (i) expand its cable systems; (ii)
conduct routine replacement of cable television plant; and (iii) increase
the channel capacity of certain systems.
The Company expects that cash flow from operating activities and available
borrowings will be sufficient to meet its debt service obligations,
anticipated capital expenditure requirements and working capital needs for
the next twelve months, as well as through the maturity date of the Notes.
The Amended and Restated Credit Agreement and the Indenture restrict,
among other things, the Company's and the Subsidiary Guarantors' ability
to incur additional indebtedness, incur liens, pay distributions or make
certain other restricted payments, consummate certain asset sales, enter
into certain transactions with affiliates, merge or consolidate with any
other person or sell, assign, transfer, lease, convey or otherwise dispose
of all or substantially all of the assets of the Company. The Amended and
Restated Credit Agreement also requires the Company to maintain specified
financial ratios and satisfy certain financial condition tests. The
obligations under the Amended and Restated Credit Agreement are secured by
(i) a pledge of all of the equity interest of the Company's subsidiaries
and (ii) subject to certain exceptions, a perfected first priority
security interest in all tangible and intangible assets.
<PAGE>
PART II. OTHER INFORMATION
ITEM 5. Other Information
-----------------
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
REVENUE AND OPERATING CASH FLOW REPORT
(UNAUDITED)
Three Months Ended September 30, 1995 and 1996
<CAPTION>
REVENUES:
1995 1996
----------- ------------
<S> <C> <C>
Georgia................................ $ 5,105,028 $ 5,820,814
Illinois............................... 2,244,841 2,342,937
Michigan............................... 970,607 1,064,640
RTL-Tennessee.......................... 4,432,335 5,021,119
RAP-Tennessee.(3)...................... - 4,363,337
Other(2)............................... 556 32,902
----------- -----------
Total............................... $12,753,367 $18,645,749
=========== ===========
OPERATING CASH FLOW(1):
Georgia................................ $ 2,700,304 $ 3,005,628
Illinois............................... 1,072,923 1,208,603
Michigan............................... 441,768 540,109
RTL-Tennessee.......................... 2,404,582 2,580,686
RAP-Tennessee.(3)...................... - 2,046,377
Other.................................. 4,004 15,272
----------- -----------
Total............................... $ 6,623,581 $ 9,396,675
=========== ===========
OPERATING CASH FLOW AS A PERCENT OF REVENUES:
Georgia................................ 52.9 % 51.6 %
Illinois............................... 47.8 % 51.6 %
Michigan............................... 45.5 % 50.7 %
RTL-Tennessee.......................... 54.3 % 51.4 %
RAP-Tennessee.(3)...................... - 46.9 %
Total (excluding other)............. 51.9 % 50.4 %
<FN>
(1) Excludes management fee expense of $446,340 and $652,602 and net losses related to
the disposition of certain plant assets of $131,691 and $195,360 for the three months
ended September 30, 1995 and 1996, respectively, and non-cash management incentive plan
expense of $174,999 for the three months ended September 30, 1996.
(2) Principally interest income.
(3) Activity relates to the Mid-Tennessee Systems acquired on March 1, 1996 and the RCT
Systems acquired on April 1, 1996.
</TABLE>
<PAGE>
<TABLE>
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
REVENUE AND OPERATING CASH FLOW REPORT
(UNAUDITED)
Nine Months Ended September 30, 1995 and 1996
<CAPTION>
REVENUES:
1995 1996
----------- -----------
<S> <C> <C>
Georgia................................ $14,602,144 $16,948,578
Illinois............................... 6,607,688 7,081,187
Michigan............................... 2,867,883 3,163,046
RTL-Tennessee.......................... 13,076,758 14,883,618
RAP-Tennessee.(3)...................... - 9,670,118
Other(2)............................... 2,512 685,589
----------- ===========
Total............................... $37,156,985 $52,432,136
=========== ===========
OPERATING CASH FLOW(1):
Georgia................................ $ 7,439,541 $ 8,694,950
Illinois............................... 3,357,535 3,549,816
Michigan............................... 1,382,824 1,576,670
RTL-Tennessee.......................... 7,033,049 7,818,369
RAP-Tennessee.(3)...................... - 4,537,642
Other.................................. (55,615) 639,963
----------- -----------
Total............................... $19,157,334 $26,817,410
=========== ===========
OPERATING CASH FLOW AS A PERCENT OF REVENUES:
Georgia................................ 50.9 % 51.3 %
Illinois............................... 50.8 % 50.1 %
Michigan............................... 48.2 % 49.8 %
RTL-Tennessee.......................... 53.8 % 52.5 %
RAP-Tennessee.(3)...................... - 46.9 %
Total (excluding other)............. 51.7 % 50.6 %
<FN>
(1) Excludes management fee expense of $1,300,374 and $1,815,516 and net losses related
to the disposition of certain plant assets of $264,742 and $784,618 for the nine months
ended September 30, 1995 and 1996, respectively, and non-cash management incentive plan
expense of $524,997 for the nine months ended September 30, 1996.
(2) Principally interest income. In addition, 1996 includes interest income from Senior
Subordinated Notes proceeds held in escrow from January 31, 1996 through March 1, 1996,
totalling $560,265.
(3) Activity relates to the Mid-Tennessee Systems acquired on March 1, 1996 and the RCT
Systems acquired on April 1, 1996.
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, as amended,
the Registrant has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City
of Denver, State of Colorado, as of November 14, 1996.
RIFKIN ACQUISITION PARTNERS, L.L.L.P.
By: Rifkin Acquisition Management, L.P.
a Colorado limited partnership, its
general partner
By: RT Investments Corp., a Colorado
corporation, its general partner
By: /s/ Dale D. Wagner
____________________________________
Dale D. Wagner
Its: Vice President & Assistant
Treasurer (Principal Financial
Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001011701
<NAME> RIFKIN ACQUISITION CAPITAL CORP
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,243
<SECURITIES> 0
<RECEIVABLES> 1,054
<ALLOWANCES> 338
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 112,582
<DEPRECIATION> 11,153
<TOTAL-ASSETS> 304,043
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 200,000
0
0
<COMMON> 0
<OTHER-SE> 71,792
<TOTAL-LIABILITY-AND-EQUITY> 304,043
<SALES> 0
<TOTAL-REVENUES> 52,432
<CGS> 0
<TOTAL-COSTS> 53,813
<OTHER-EXPENSES> 785
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,095
<INCOME-PRETAX> (18,261)
<INCOME-TAX> (2,555)
<INCOME-CONTINUING> (15,706)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (15,706)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>The amount shown for current assets and current liabilities is
zero due to an unclassified balance sheet in the financial
statements.
</FN>
</TABLE>
