SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended Commission file number 0-17091
December 31, 1997
CSA Income Fund Limited Partnership II
(Exact name of registrant as specified in its charter)
Massachusetts No. 04-2932178
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
22 Batterymarch St., Boston, MA 02109
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code: (617) 357-1700
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: 78,785
Units of Limited Partnership Interest
Indicate by check whether 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 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
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. [ X ]
Number of shares outstanding of each registrant's classes of
securities:
Number of Units
Title of Each Class at December 31, 1997
Units of Limited Partnership 78,785
Interest: $250 per unit
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
Portions of Part IV are incorporated by reference
to Post-Effective Amendment No. 1 to Form S-1,
Registration No. 33-11272
The exhibit index is located on pages 19 and 20.
Part I
Item 1. Business
CSA Income Fund Limited Partnership II (the "Partnership") was a
limited partnership organized under the provisions of The
Massachusetts Uniform Limited Partnership Act. The Partnership was
composed of CSA Income Funds, Inc., the General Partner (an affiliate
of CSA Financial Corp.),and 1,817 Limited Partners owning 78,785 Units
of Limited Partnership Interest of $250 each, the capital
contributions of which aggregated $19,689,570 at December 31, 1997.
The Partnership was formed on September 17, 1986 and commenced
operations on June 26, 1987. The Partnership terminated its public
offering on June 30, 1988.
THE GENERAL PARTNER COMPLETED THE WIND-UP OF THE PARTNERSHIP DURING 1997.
A FINAL DISTRIBUTION WAS PAID TO ALL LIMITED PARTNERS ON DECEMBER 31, 1997.
THE PARTNERSHIP WILL BE DISSOLVED BY THE GENERAL PARTNER UPON THE FILING OF
A CERTIFICATE OF CANCELLATION WITH THE STATE OF MASSACHUSETTS. THIS IS THE
FINAL PARTNERSHIP 10-K TO BE FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION.
The Partnership was organized to engage in the business of acquiring
income-producing equipment for investment. The Partnership's
principal objectives were:
1.To acquire and lease equipment, primarily through Operating
Leases,to generate income during its entire useful life;
2.To provide quarterly distributions of cash to the Limited
Partners from leasing revenues and from the proceeds of sale or
other disposition of Partnership Equipment; and
3.To reinvest in additional equipment a portion of lease revenues
and a substantial portion of Cash From Sales and Refinancings during
the first years of the Partnership's operations.
The Partnership was formed primarily for investment purposes and not
as a "tax shelter".
The registrant had no direct employees. The General Partner had full
and exclusive discretion in management and control of the Partnership.
Selection of the equipment for purchase and lease was based
principally on the General Partner's evaluation of the usefulness of
the Equipment in commercial or industrial applications and its
estimate of the potential demand for the equipment at the end of the
initial lease term.
<PAGE>
The Partnership's equipment may have included:
1.New and reconditioned computer peripheral equipment, computer
terminal systems and data processing systems primarily manufactured by
International Business Machines, Inc. (IBM) and qualified for IBM
maintenance.
2.New telecommunications and telecomputer equipment consisting
primarily of private automated branch exchanges (PBXs), advanced
high-speed digital telephone switching devices, voice/data
transmission devices and telephone/computer networks as well as
telephone handsets and facsimile transmission products.
3.New office equipment consisting primarily of photocopying and
graphic processing equipment.
4.New highway transportation equipment and new and reconditioned air
transportation equipment consisting primarily of tractors, trailers,
trucks,intermodal equipment, railroad rolling stock, passenger
vehicles and corporate or commercial aircraft.
5.Miscellaneous other types of equipment which met the investment
objective of the Partnership.
The equipment leasing industry is highly competitive. In initiating
its leasing transactions, the Partnership competed with leasing
companies,manufacturers that lease their products directly, equipment
brokers and dealers and financial institutions, including commercial
banks and insurance companies. Many competitors are larger than the
Partnership and have access to more favorable financing. Competitive
factors in the equipment leasing business primarily involve pricing
and other financial arrangements. Marketing capability is also a
factor.
The lessees providing at least 10% of total revenues during 1997 are
as follows:
America West Airlines 18%
K-Mart Corporation 21%
Lucent Technologies Inc. 32%
U.S. West Communications, Inc. 12%
The Partnership's leases and equipment are described more fully in
Notes 3 and 4 to the Financial Statements included in Item 8.
<PAGE>
Item 2. Properties
The Partnership neither owned nor leased office space or equipment for
the purpose of managing its day-to-day affairs. The General Partner,
CSA Income Funds, Inc. (CIF), had exclusive control over all aspects
of the business of the Partnership, including provision for any
necessary office space. As such, CIF was compensated through
Management Fees and reimbursement of General and Administrative costs
related to managing the Partnership's business. Excluded from the
allowable reimbursement to the General Partner,however, was any of
the following:
(1) Expenditures for rent or utilities;(2) Capital equipment and the
related depreciation; and (3) Certain other administrative items.
Item 3. Legal Proceedings
The Partnership was not a party to any pending legal proceedings.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of
1997.
PART II
Item 5. Market for the Registrant's Equity Securities and Related
Security Holder Matters
a.The Partnership's limited partnership interests were not publicly
traded. There was no market for the Partnership's limited partnership
interests.
b.Approximate Number of Equity Security Holders:
Title of Class Number of Limited Partners
Units of Limited Partnership Interests as of 12/31/97
78,785 1,817
c.Distributions were paid at a rate determined by the General
Partner.
Total Distributions paid per Limited Partnership Unit during 1997,
1996,1995, 1994 and 1993 were as follows:
<TABLE>
1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
February $ 4.38 4.38 $ 4.38 $ 4.38 $ 6.25
May 4.38 4.38 4.38 4.38 4.38
August 4.38 4.38 4.38 4.38 4.38
November 4.38 4.38 4.38 4.38 4.38
December 8.32 - - - -
$25.84 $17.52 $17.52 $17.52 $19.39
</TABLE>
<PAGE>
Item 6. Selected Financial Data - Unaudited
The following table sets forth selected financial information
regarding the Partnership's financial position and operating results.
The information should be read in conjunction with the Financial
Statementsand Notes thereto, and General Partner's Discussion and
Analysis of Financial Condition and Results of Operations, which are
included in Items 7 and 8 of this Report.
<TABLE>
<CAPTION>
Years Ended December 31,
(IN THOUSANDS EXCEPT PER UNIT AMOUNTS)
1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
Total Revenues $1,742 $1,958 $2,224 $3,542 $3,559
Net Income 753 597 905 883 1,371
Net Income per
Limited Partnership
Unit 7.59 7.29 11.38 11.10 17.24
Total Assets - 2,552 3,001 3,802 4,892
Notes Payable - 1,126 803 751 1,452
Limited Recourse
Notes Payable - 78 71 292 -
Distributions per
Limited Partnership
Unit 25.84 17.52 17.52 17.52 19.39
</TABLE>
<PAGE>
Item 7.General Partner's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations
During 1997, the General Partner sold all remaining leases and
equipment and paid its final distribution.
Gross rental income for the years ended December 31, 1997, 1996, and
1995 was $1,105,953, $1,882,003 and $2,014,366, respectively. The
decrease in gross rental income over time is attributable to the
expected occurrence of reduced rental rates for re-leased equipment
and to the sale of equipment from the Partnership's portfolio.
Net income for the year ended December 31, 1997 was $753,010 as
compared to net income of $597,769 and $905,421 in the years ended
December 31,1996 and 1995, respectively. The increase in net income
was primarily due to the gain on sale of equipment as the Partnership
was dissolved.
Interest income for 1997, 1996, and 1995 was $5,703, $17,249, and
$60,417, respectively. The 1997 decrease was due to lower cash
balances. Interest expense was $47,414, $92,067, and $67,724, for the
years ended December 31, 1997, 1996, and 1995, respectively. Interest
expense decreased in 1997 primarily due to the reduction of debt
during the year.
Liquidity and Capital Resources
During 1997, the Partnership realized cash flow from operations of
$987,329 and $1,628,942 from the sale of equipment. The Partnership
utilized the cash flow from operations and sale of equipment to reduce
notes payable and make distributions to its partners. Notes payable
were reduced by $1,126,931 in 1997 and distributions to the partners
were $2,046,260.
The General Partner informed the Limited Partners in the 1996 Third
Quarter Financial Report mailed on November 14, 1996 that the
Partnership was winding up and the Partnership would be dissolved in
1997. The General Partner completed the wind up in 1997 and paid a
final distribution on December 31, 1997. The Partnership distributed
$8.32 per Limited Partnership Unit on December 31, 1997. Over its
life, the Partnership made cash distributions to the Limited Partners
ranging from 92% to 101% of their initial investment,depending on when
the Limited Partner entered the Partnership.
<PAGE>
Quarterly Financial Data - Unaudited
Summarized unaudited quarterly financial data for the years ended
December 31, 1997 and 1996 is as follows:
<TABLE>
<CAPTION>
1997 Quarter Ended: 12/31 9/30 6/30 3/31
<S> <C> <C> <C> <C>
Total Revenues * $ 752,967 $ 245,638 $ 313,206 $ 430,803
Net Income 613,866 35,744 3,170 100,230
Net Income
Per Limited
Partnership Unit 6.22 .45 .04 .88
Cash Distributions
Paid Per Limited
Partnership Unit 12.70 4.38 4.38 4.38
1996 Quarter Ended: 12/31 9/30 6/30 3/31
Total Revenues *$ 491,904 $ 530,488 $ 541,230 $ 394,546
Net Income 90,294 163,488 205,315 138,672
Net Income
Per Limited
Partnership Unit .92 2.05 2.58 1.74
Cash Distributions
Paid Per Limited
Partnership Unit 4.38 4.38 4.38 4.38
</TABLE>
* Total revenues include the net gains and losses from the sale of
equipment.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
There was no Market Risk related to the Notes Payables of the Partnership
since all Notes were Nonrecourse and had fixed interest rates. There were
no other financial instruments that required Market Risk disclosure.
<PAGE>
Item 8. Financial Statements
<TABLE>
CSA Income Fund Limited Partnership II
Index to Financial Statements
Page
Number
<S> <C>
Independent Auditors' Report 9
Statements of Financial Position
as of December 31, 1997 and 1996 10
Statements for the Years Ended
December 31, 1997, 1996 and 1995:
Cash Flows 12
Changes in Partners' Capital (Deficit) 13
Notes to Financial Statements 14
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Partners of CSA Income Fund Limited Partnership II
We have audited the accompanying statements of financial position
of CSA Income Fund Limited Partnership II as of December 31, 1997
and 1996, and the related statements of operations, cash flows, and
changes in partners' capital (deficit) for the three years then
ended. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
As discussed in note 1 to the financial statements, the General
Partner has completed the wind-up of the Partnership during 1997
and a final distribution was paid to all Limited Partners on
December 31, 1997.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of CSA
Income Fund Limited Partnership II as of December 31, 1997 and
1996, and the results of its operations and its cash flows for the
three years then ended in conformity with generally accepted
accounting principles.
\s\ Sullivan Bille, P.C.
Boston, Massachusetts
March 6, 1998
<PAGE>
<TABLE>
<CAPTION>
CSA INCOME FUND LIMITED PARTNERSHIP II
Statements of Financial Position as of
December 31, 1997 and 1996
1997 1996
<S> <C> <C>
Assets
Cash and cash equivalents $ - $ 556,920
Accounts receivable - affiliates - 69,648
Rental equipment, at cost - 5,509,177
Less accumulated depreciation - (3,613,329)
Net rental equipment - 1,895,848
Total assets $ - $ 2,522,416
Liabilities and Partners' Capital
Accrued management and
reimbursable fees $ - $ 9,758
Accounts payable - 11,226
Deferred income - 3,202
Notes payable - 1,126,931
Limited recourse notes payable - 78,049
Total liabilities - 1,229,166
Partners' capital:
General Partner (deficit):
Capital contribution 1,000 1,000
Cumulative net gain 177,508 22,769
Cumulative cash distributions (178,508) (168,052)
- (144,283)
Limited Partners (78,785 units):
Capital contributions,
net of offering costs 17,563,265 17,563,265
Cumulative net gain 1,112,043 513,772
Cumulative cash distributions (18,675,308) (16,639,504)
- 1,437,533
Total partners' capital - 1,293,250
Total liabilities and
partners' capital $ - $ 2,522,416
See accompanying notes to financial statements
</TABLE>
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP II
Statements of Operations for the
years ended December 31, 1997, 1996 and 1995
<TABLE>
<CAPTION>
1997 1996 1995
<S> <C> <C> <C>
Revenues:
Rental income $ 1,105,953 $ 1,882,003 $ 2,014,366
Interest income 5,703 17,249 60,417
Gain on sale of
equipment 630,958 58,916 149,837
Total revenues 1,742,614 1,958,168 2,224,620
Costs and expenses:
Depreciation 816,236 1,101,087 1,064,341
Interest 47,414 92,067 67,724
Storage and
refurbishment 3,886 3,000 8,400
Management fees 55,297 94,100 100,718
General and
administrative 66,771 70,145 78,016
Total expenses 989,604 1,360,399 1,319,199
Net income $ 753,010 $ 597,769 $ 905,421
Net income allocation:
General Partner $ 154,739 $ 23,382 $ 9,054
Limited Partners 598,271 574,387 896,367
$ 753,010 $ 597,769 $ 905,421
Net income per Limited
Partnership Unit $ 7.59 $ 7.29 $ 11.38
Number of Limited
Partnership Units
Outstanding 78,785 78,785 78,785
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
CSA INCOME FUND LIMITED PARTNERSHIP II
Statements of Cash Flows for the
years ended December 31, 1997, 1996 and 1995
1997 1996 1995
<S> <C> <C> <C>
Cash flows from operations:
Cash received from rental
of equipment $ 1,175,978 $ 2,004,959 $ 1,871,777
Cash paid for operating
and management expenses (146,938) (178,466) (280,280)
Interest paid (47,414) (92,067) (67,724)
Interest received 5,703 17,249 60,417
Net cash from operations 987,329 1,751,675 1,584,190
Cash flows from investments:
Purchase of equipment - (1,409,642) (1,006,788)
Sale of equipment 1,628,942 257,313 1,217,771
Net cash from (used for)
investments 1,628,942 (1,152,329) 210,983
Cash flows from financing:
Proceeds from
notes payable - 1,111,573 601,411
Repayment of
notes payable (1,126,931) (781,111) (771,207)
Payment of cash
distributions (2,046,260) (1,394,254) (1,394,256)
Net cash used for
financing (3,173,191) (1,063,792) (1,564,052)
Net change in cash and
cash equivalents (556,920) (464,446) 231,121
Cash and cash equivalents
at beginning of year 556,920 1,021,366 790,245
Cash and cash equivalents
at end of year $ 0 $ 556,920 $ 1,021,366
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
CSA INCOME FUND LIMITED PARTNERSHIP II
Statement of Changes in Partners' Capital (Deficit)
for the years ended December 31, 1997, 1996 and 1995
Limited General
Partners Partner Total
<S> <C> <C> <C>
Balance at
December 31, 1994 $ 2,727,405 $ (148,835) $ 2,578,570
Net income 896,367 9,054 905,421
Cash distributions (1,380,313) (13,943) (1,394,256)
Balance at
December 31, 1995 2,243,459 (153,724) 2,089,735
Net income 574,387 23,382 597,769
Cash distributions (1,380,313) (13,941) (1,394,254)
Balance at
December 31, 1996 1,437,533 (144,283) 1,293,250
Net income 598,271 154,739 753,010
Cash distributions (2,035,804) (10,456) (2,046,260)
Balance at
December 31, 1997 $ 0 $ 0 $ 0
</TABLE>
See accompanying notes to financial statements.
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP II
Notes to Financial Statements
(1) Organization
The Partnership was formed under the Massachusetts Uniform Limited
Partnership Act on September 17, 1986, with an initial investment of
$1,000, to invest primarily in equipment to be leased to third
parties. On June 26, 1987, the Partnership commenced operations,
admitting 397 Limited Partners who purchased 12,398 partnership units,
contributing $3,098,860 in capital. Subsequent to the initial
closing, the Partnership admitted an additional 469 Limited Partners
whose capital contribution totalled $5,404,800, representing 21,634
partnership units during 1987 and an additional 1,007 Limited Partners
whose capital contributions totalled $11,185,910 representing 44,753
partnership units during 1988. The Partnership terminated its
offering period on June 30, 1988.
During 1997, the General Partner completed the wind-up of the Partnership.
All remaining leases and equipment were sold and a final distribution was
paid to all Limited Partners on December 31, 1997.
Distributable cash from operations, sales or refinancings and profits
or losses for federal income tax purposes were allocated 99% to the
Limited Partners and 1% to the General Partner until Payout occurred,
and thereafter, 85% and 15% respectively. As provided by the
Partnership Agreement, pursuant to Section 8.3 (c), accounting profits
from the sale of equipment that results in the dissolution of the
Partnership, were allocated to each partner first in the amount equal
to the negative balance in the Capital Account of such partner. In
connection with the wind up of the Partnership, certain gains on the
disposition of partnership assets were allocated during the fourth
quarter of 1996 and the year 1997 to the General Partner to reduce its
Capital Account negative balance.
In accordance with the Partnership Agreement, the Partnership was
liable to the General Partner (or its affiliates) for management fees
and reimbursable operating expenses calculated in amounts not to
exceed 5% and 2%, respectively, of gross rental revenues. As of December
31, 1997, all such liabilities had been paid by the Partnership.
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP II
Notes to Financial Statements
(2) Significant Accounting Policies
The Partnership records were maintained on the accrual basis of
accounting.The Partnership accounted for equipment leases as operating
leases; therefore, rental income was reported when earned and the cost
of the equipment was depreciated on a straight-line basis over the
shorter of the initial term of the lease or five years, to estimated
realizable value at the end of such period. On a periodic basis, the
artnership conducted a review of the net book values of its equipment
as compared to the estimated net realizable values for such equipment.
The Partnership recorded additional charges to depreciation expense
when netbook values exceeded estimated net realizable values. Based on
this analysis, the Partnership recorded no additional charges to
depreciation expense in 1995, 1996 or 1997.
No provision for income taxes was made as the liability for such taxes
was that of the partners rather than the Partnership. The
Partnership's federal tax return is prepared solely to arrive at the
Partner's individual taxable income or loss as reported on form K-1.
The Partnership's book income exceeded federal taxable income by
approximately $268,660 for 1997.Partnership federal taxable income
exceeded book income by approximately $40,000 for 1996. The
Partnership's book income exceeded federal taxable income by
approximately $271,000 for 1995. The differences were primarily due
to differences in the depreciation methods for book and income tax
purposes.
The Partnership considered short-term investments with original
maturities of three months or less to be cash equivalents.
The preparation of financial statements in conformity with generally
accepted accounting principles required the General Partner to make
estimates and assumptions that affected the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities as
of the date of the financial statements and the reported amounts of
revenue and expenses during the reporting year. Actual results could
differ from those estimates.
(3) Rental Equipment
The Partnership purchased no equipment during 1997. The Partnership
had purchased equipment in prior years subject to existing leases
either directly from CSA Financial Corp. or the manufacturer. The
purchase price to the Partnership was equal to the lessor of fair
market value or cost as adjusted, if necessary, for rents received and
carrying costs,plus an acquisition fee of 4% of cost.
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP II
Notes to Financial Statements
(4) Leases
Four lessees provided approximately 83% (32%, 21%, 18% and 12%,
respectively) of the Partnership's rental income in 1997 as compared
with four lessees providing 60% (22%, 16%, 12% and 10%, respectively)
and two lessees providing approximately 28% (14% and 14%, espectively)
in 1996 and 1995, respectively.
(5) Notes Payable
Notes payable consisted of notes due in monthly installments, with
interest rates that ranged from 7.00% to 9.11% per annum. Such notes
were all paid in full as part of the dissolution of the Partnership.
(6) Limited Recourse Notes Payable
The Limited recourse notes payable of $78,049, which matured in 1997,
consisted of notes due with interest (9.2% to 10.3%) at maturity which
coincided with the expiration of the initial lease term of the related
equipment.
(7) Fair Values of Financial Instruments
The following methods and assumptions were used to estimate the fair
value of financial instruments:
Cash and Cash Equivalents
The carrying amount of cash and cash equivalents approximated its fair
value due to their short maturity.
Notes Payable
The fair value of the Partnership's notes payable was based on the
market price for the same or similar debt issues or on the current
rates offered to the Partnership for debt with the same remaining
maturity. The carrying amount of notes payable approximated fair
value.
Limited Recourse Notes Payable
The carrying amount of the limited recourse notes payable approximated
its fair value due to their short maturities.
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP II
Notes to Financial Statements
(8) Related Party Transactions
Fees and other expenses paid or accrued by the Partnership to the
General Partner or affiliates of the General Partner for the years
1997, 1996 and 1995 were as follows:
<TABLE>
<CAPTION>
1997 1996 1995
<S> <C> <C> <C>
Equipment acquisition fees $ - $ 54,217 $ 36,542
Management fees 55,297 94,100 100,718
Reimbursable operating expenses 22,119 37,640 40,287
Storage and Refurbishment fees 3,886 3,000 8,400
Total $ 81,302 $ 188,957 $ 185,947
</TABLE>
(9) Net Cash Provided from Operations
The reconciliation of net income to net cash from operations for the
years 1997, 1996 and 1995 is as follows:
<TABLE>
<CAPTION>
1997 1996 1995
<S> <C> <C> <C>
Net income $ 753,010 $ 597,769 $ 905,421
Depreciation 816,236 1,101,087 1,064,341
Gain on sale
of equipment (630,958) (58,916) (149,837)
(Increase) decrease
in receivables 69,648 124,590 (93,630)
Other 3,579 - -
Decrease in payables
and deferred income (24,186) (12,855) (142,105)
Net cash from operations $987,329 $ 1,751,675 $1,584,190
</TABLE>
In addition, there were noncash financing transactions that reduced
Limited recourse notes payable by $78,049 during 1997.
<PAGE>
PART III
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None
Item 10. Directors and Executive Officers of the Registrant
The Partnership had no directors or officers. All management
functions were performed by CSA Income Funds, Inc., the corporate
General Partner. The current directors and officers of the corporate
General Partner are:
<TABLE>
<CAPTION>
Name Age Title(s) Elected
<S> <C> <C> <C>
J. Frank Keohane 61 Director & President 04/01/88
Richard P. Timmons 43 Controller 03/01/95
Trevor A. Keohane 31 Director 05/28/93
</TABLE>
Term of Office: Until a successor is elected.
Item 11. Executive Compensation
(a), (b), (c), (d) and (e): The Officers and Directors of the General
Partner received no current or proposed direct remuneration in such
capacities, pursuant to any standard arrangements or otherwise, from
the Partnership. In addition, the Partnership did not pay and does
not propose to pay any options, warrants or rights to the Officers and
Directors of the General Partner. There exists no remuneration plan
or arrangement with any Officer or Director of the General Partner
resulting from resignation, retirement or any other termination. See
Note 8 of the Notes to Financial Statements included in Item 8 of this
report for a description of the remuneration paid by the Partnership
to the General Partner and its affiliates.
<PAGE>
Item 12. Security Ownership of Certain Beneficial Owners and
Management
By virtue of its organization as a limited partnership, the
Partnership had outstanding no securities possessing traditional
voting rights. However, as provided for in Section 13.2 of the
Agreement of Limited Partnership (subject to Section 13.3), a
majority in interest of the Limited Partners had voting rights with
respect to:
1. Amendment of the Limited Partnership Agreement.
2. Termination of the Partnership.
3. Removal of the General Partner.
4. Approval or disapproval of the sale of substantially all
the assets of the Partnership, if such sale occured prior to June 30,
1995.
No person or group was known by the General Partner to own
beneficially more than 5% of the Partnership's outstanding Limited
Partnership Units as of December 31, 1997.
Item 13. Certain Relationships and Related Transactions
The General Partner is affiliated with the General Partner for CSA
Income Fund Limited Partnership III and CSA Income Fund IV Limited
Partnership and may act in that capacity for other income fund
limited partnerships in the future.
PART IV
Item 14. Exhibits, Financial Statements, Schedules and Reports
on Form 8-K
(a) (1) Financial Statements - See accompanying Index to Financial
Statements - Item 8.
(2) Financial Statement Schedules - All schedules have been
omitted as not required, not applicable or the information
required to be shown therein is included in the Financial
Statements and related notes.
(3) Exhibits Index
Except as set forth below, all exhibits to Form 10-K, as
set forth in item 601 of Regulation S-K are not applicable.
<PAGE>
<TABLE>
Page Number or
Exhibit Incorporated by
Number Description Reference
<S> <C> <C>
4.1 Agreement of Limited Partnership *
4.2 Subscription Agreement **
4.3 Certificate of Limited Partnership and ***
Agreement of Limited Partnership dated
September 17, 1986
4.4 First Amended and Restated Certificate ***
of Limited Partnership and Agreement
of Limited Partnership dated January 9,1987
4.5 Second Amended and Restated Certificate ****
of Limited Partnership and Agreement of
Limited Partnership dated March 10, 1987
10. Material Contracts ***
10.1 Escrow Agreement ****
27.1 Financial Data Schedule
</TABLE>
* Included as Exhibit A to Amendment No. 1 to Form S-1,
Registration Statement No. 33-11272 filed with the Securities
and Exchange Commission on March 11, 1987.
** Included as Exhibit C to Amendment No. 1 to Form S-1 to
Registration Statement No. 33-11272 filed with the Securities
and Exchange Commission on March 11, 1987.
*** Included with the Exhibit Volume to Form S-1, Registration
Statement No. 33-11272 filed with the Securities and Exchange
Commission on January 12, 1987.
**** Included with the Exhibit Volume to Amendment No. 1 to Form
S-1, Registration Statement No. 33-11272 filed with the
Securities and Exchange Commission on March 11, 1987.
(b) Reports on Form 8-K: There were no reports filed during the
fourth quarter of 1997.
<PAGE>
Signatures
Pursuant to the requirements of Section 13 or 15(d) 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.
CSA Income Fund Limited
Partnership II (Registrant)
By its General Partner,
CSA Income Funds, Inc.
Date:
/s/ J. Frank Keohane, President
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 dates indicated.
By its General Partner,
CSA Income Funds, Inc.
Date:
/s/ J. Frank Keohane
President & Director
Principal Executive Officer
Date:
/s/ Christopher R. Guiod
Senior Vice President
Finance and Administration
Date:
/s/ Richard P. Timmons
Controller
Principal Accounting and
Finance officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from CSA income
Fund Limited Partnership II's Statement of Financial Position as of December
31, 1997 and Statement of Operations for the twelve months then ended and is
qualified in its entirely by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 1,742,614
<CGS> 0
<TOTAL-COSTS> 875,419
<OTHER-EXPENSES> 66,771
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 47,414
<INCOME-PRETAX> 753,010
<INCOME-TAX> 0
<INCOME-CONTINUING> 753,010
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 753,010
<EPS-PRIMARY> 7.59
<EPS-DILUTED> 7.59
<FN>
<F1>The Registrant maintains an unclassified Statement of Financial Position.
</FN>
</TABLE>
