<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 30, 1996 Commission file number 2-22997
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MILLS MUSIC TRUST
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(Exact name of registrant as specified in its charter)
New York 13-6183792
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
c/o Marine Midland Bank, 140 Broadway, New York, NY 10015
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(Address of principal executive offices) (ZIP Code)
Registrant's telephone number, including area code (212) 658-6014
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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
--- ---
Number of Trust Units outstanding as of March 20, 1996 277,712
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PART I - FINANCIAL STATEMENTS
Item 1. Financial Information
MILLS MUSIC TRUST
STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September, 30 September, 30
------------------------- -------------------------
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Receipts:
Mills Music, Inc. $241,365 $367,667 $858,030 $935,661
Undistributed cash
at beginning of
the period 20 27 30 776
Disbursements-
administrative expenses (5,902) (3,248) (22,773) (28,562)
-------- -------- -------- --------
Balance available
for distribution 235,483 364,446 835,287 907,875
Cash distribution
to unit holders 235,472 364,415 835,276 907,844
-------- -------- -------- --------
Undistributed cash at
end of the period $ 11 $ 31 $ 11 $ 31
======== ======== ======== ========
Cash distribution per
unit (based on 277,712
units outstanding) $ .85 $ 1.31 $ 3.01 $ 3.27
======== ======== ======== ========
</TABLE>
See accompanying Notes to Statements of Cash Receipts and Disbursements.
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MILLS MUSIC TRUST
NOTES TO STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
NOTE 1. ACCOUNTING POLICIES AND GENERAL INFORMATION
Mills Music Trust ("the Trust") was created in 1964 for
the purpose of acquiring the rights to receive payments of a
deferred contingent purchase price contract obligation payable by
Mills Music, Inc. ("Mills"). The contingent payments are
determined quarterly, and are based on a formula which takes into
account gross royalty income from certain music copyrights and
licenses of Mills, less royalties paid and amounts deducted by
Mills in accordance with contract terms.
Payments from Mills to the Trust are made in March, June,
September, and December, and include net royalty income of the
preceding calendar quarter. The payments received are accounted
for on a cash basis, as are expenses paid. The Declaration of
Trust requires the distribution of all funds received by the
Trust to the Unit holders after payment of expenses.
The statements of cash receipts and disbursements reflect
only cash transactions and do not present transactions that would
be included in financial statements presented on the accrual
basis of accounting, as contemplated by generally accepted
accounting principles.
There is no book value per unit because cumulative
distributions are in excess of the initial investment in the
Trust.
NOTE 2. RELATED PARTY TRANSACTIONS
The Declaration of Trust provides that each trustee shall
receive reimbursement for expenses reasonably incurred in the
performance of his duties and annual compensation of $2,500 per
year for his services as trustee, provided that such aggregate
compensation to the trustees as a group may not exceed 3% of the
monies received by the Trust in any year. The Declaration of
Trust further provides for reimbursement to the corporate trustee
for its clerical and administrative services to the Trust.
Accordingly, Marine Midland Bank receives reimbursement for such
services and for services performed as Registrar and Transfer
Agent. The Declaration of Trust further provides that if any
trustee performs unusual or extraordinary services, reasonable
compensation for such services shall be paid, subject to certain
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MILLS MUSIC TRUST
NOTES TO STATEMENTS OF CASH RECEIPTS AND DISBURSEMENTS
THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(CONTINUED)
(UNAUDITED)
limitations and to prior confirmation by a majority in interest
of Trust Certificate holders. Pursuant to these provisions,
disbursements to related parties were made as follows for the
nine months ended September 30, 1996 and 1995:
1996 1995
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Trustee Fees:
Bernard D. Fischman $1,875 $1,875
Marine Midland Bank 1,875 1,875
Marine Midland Bank - Transfer
Agent and Registrar 0 6,100
NOTE 3. ROYALTY EXAMINATION
The Trust's claim against Belwin Mills Publishing
Corporation, the former administrators of the Old Mills
Catalogue, in connection with a royalty examination is pending.
It cannot be determined at this time, what, if any, amount may
ultimately be received by the Trust.
Legal and accounting fees paid from inception (1987)
through September 30, 1996 by the Trust in connection with this
examination aggregate $75,438.
No examinations of royalty information have been performed
subsequent to February, 1987.
NOTE 4. FEDERAL INCOME TAXES
No provision for income taxes has been made since the
liability is that of the unit holders and not the Trust.
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PART I - FINANCIAL STATEMENTS
Item 2. Management's Discussion and Analysis of Results of Operations
The Trust's receipts from Mills Music, Inc. are derived
from copyrights established prior to 1964 and such receipts
fluctuate based upon public interest in the "nostalgia" appeal of
older songs.
PART II - OTHER INFORMATION
Items 1 through 6, inclusive, are not applicable.
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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.
MILLS MUSIC TRUST
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(Registrant)
Date 10/24/96 By: BERNARD D. FISCHMAN
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Bernard D. Fischman, Trustee
Date 10/24/96 By: MARCIA MARKOWSKI
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Marine Midland Bank
Corporate Trustee
<PAGE> 7
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
27 FINANCIAL DATA SCHEDULE
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 858,030
<TOTAL-REVENUES> 858,030
<CGS> 22,773
<TOTAL-COSTS> 22,773
<OTHER-EXPENSES> 835,276
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (19)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (19)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
