SECURITIES AND EXCHANGE COMMISSION
Washington, DC. 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
June 30,1995
0-16690
(Commission File Number)
ML MEDIA OPPORTUNITY PARTNERS, L.P.
(Exact name of registrant as specified in its governing
instruments)
Delaware
(State or other jurisdiction of organization)
13-3429969
(IRS Employer Identification No.)
World Financial Center
South Tower - 14th Floor
New York, New York 10080-6114
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(212) 236-6472
N/A
Former name, former address and former fiscal year if changed
since last report
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 .
ML Media Opportunity Partners, L.P.
Part I - Financial Information
Item 1. Financial Statements
TABLE OF CONTENTS
Consolidated Balance Sheets as of June 30, 1995
(Unaudited) and December 31, 1994 (Unaudited)
Consolidated Statements of Operations for the
thirteen and twenty-six week periods ended June
30, 1995 (Unaudited), and June 30, 1994
(Unaudited)
Consolidated Statements of Cash Flows for the
twenty-six week periods ended June 30, 1995
(Unaudited), and June 30, 1994 (Unaudited)
Notes to the Consolidated Financial Statements
for the twenty-six week period ended June 30,
1995 (Unaudited)
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ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 1995 (UNAUDITED) AND
DECEMBER 31, 1994 (UNAUDITED)
June 30, December 31,
Notes 1995 1994
<S> <C> <C> <C>
ASSETS:
Cash and cash
equivalents 2 $ 1,674,333 $ 2,150,473
Investment in joint
venture and common
stock 2 1,228,698 1,261,666
Other assets 82,607 537,901
TOTAL ASSETS $ 2,985,638 $ 3,950,040
LIABILITIES AND
PARTNERS' DEFICIT:
Liabilities:
Accounts payable and
accrued liabilities $ 479,976 $ 688,288
Net Liabilities of
Discontinued
Operations: 2,3
Production Segment 140,711 140,711
Television and Radio
Station Segment 7,786,731 6,137,046
Total Liabilities $ 8,407,418 $ 6,966,045
Commitments and
Contingencies 2
(Continued on the following page)
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ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 1995 (UNAUDITED)
AND DECEMBER 31, 1994 (UNAUDITED)
(continued)
June 30, December 31,
Notes 1995 1994
<S> <C> <C> <C>
Partners' Deficit:
General Partners:
Capital contributions,
net of offering
expenses 1 1,019,428 1,019,428
Cash Distributions (120,077) (90,624)
Cumulative loss (933,077) (938,472)
(33,726) (9,668)
Limited Partners:
Capital contributions,
net of offering
expenses (112,147.1
Units of Limited
Partnership Interest) 1 100,914,316 100,914,316
Tax allowance cash
distribution (2,040,121) (2,040,121)
Other cash distributions
(11,887,582) (8,971,760)
Cumulative loss (92,374,667) (92,908,772)
(5,388,054) (3,006,337)
Total Partners' Deficit
(5,421,780) (3,016,005)
TOTAL LIABILITIES AND
PARTNERS' DEFICIT $ 2,985,638 $ 3,950,040
See Notes to Consolidated Financial Statements (Unaudited).
</TABLE>
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<TABLE>
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ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THIRTEEN AND TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
Thirteen Weeks Twenty-Six Weeks
June 30, June 30, June 30, June 30,
Note 1995 1994 1995 1994
s
<S> <C> <C> <C> <C> <C>
Partnership
Operating
Expenses:
General and
administrative $ 111,726 $ 45,977 $ 148,662 $ 72,733
Amortization - 74,488 - 148,978
Management 588,279 790,610 1,205,294 1,575,253
fees
700,005 911,075 1,353,956 1,796,964
Other Income $ 128,212 $ - $ 128,212 $ -
Interest 42,426 27,112 80,916 48,455
Income
170,638 27,112 209,128 48,455
Loss from
Partnership
operations (529,367) (883,963) (1,144,828) (1,748,509)
(Continued on the following page)
</TABLE>
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<TABLE>
<CAPTION>
ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THIRTEEN AND TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
Thirteen Weeks Twenty-Six Weeks
June 30, June 30, June 30, June 30,
Note 1995 1994 1995 1994
s
<S> <C> <C> <C> <C> <C>
Discontinued
operations:
Income(Loss)
from
discontinued
operations
of: 2,3
Cable
Television
Systems
Segment - - - (6,784,982)
Production
Segment - (4,885) - (10,305)
Television and
Radio Station
Segment
- (829,127) - (2,017,939)
Gain on Sale
of Radio
Station - - 1,684,328 -
NET (LOSS)
INCOME $ (529,367 $(1,717,975) $ 539,500 $(10,561,735)
(Continued on the following page)
</TABLE>
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<CAPTION>
ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THIRTEEN AND TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
Thirteen-Weeks Twenty-Six Weeks
June 30 June 30 June 30, June 30,
Note 1995 1994 1995 1994
s
<S> <C> <C> <C> <C> <C>
Per Unit of
Limited
Partnership
Interest:
Loss from
Partnership
Operations $ (4.67) $ (7.80) $ (10.10) $ (15.43)
Income(loss)
from
discontinued
operations $ - $ (7.37) $ 14.87 $ (77.81)
NET (LOSS)
INCOME $ (4.67) $ (15.17) $ 4.77 $ (93.24)
Number of 112,147.1 112,147.1 112,147.1 112,147.1
Units
</TABLE>
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ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
June 30, June 30,
Notes 1995 1994
<S> <C> <C> <C>
Cash flows from
operating activities:
Net Income(Loss) $ 539,500 $(10,561,735)
Adjustments to reconcile
net income(loss) to net
cash used in operating
activities:
Amortization - 148,976
Gain on Sale of Radio
Station (1,684,328) -
(Continued on the following page)
</TABLE>
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ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
June 30, June 30,
Notes 1995 1994
<S> <C> <C> <C>
Change in operating
assets and liabilities:
Decrease/(Increase) in
other assets 455,294 (43,861)
(Decrease)/Increase in
accounts payable and
accrued liabilities (175,344) 49,526
Change in Net
Liabilities of
Discontinued
Operations:
Cable Television
Systems Segment - 7,108,984
Television and Radio
Station Segment - 2,486,733
(Continued on the following page)
</TABLE>
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<CAPTION>
ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
June 30, June 30,
Notes 1995 1994
<S> <C> <C> <C>
Production Segment - 10,305
Net cash used in
operating activities (864,878) (801,072)
Cash flows from
investing activities:
Purchase of property,
plant and equipment - (513,075)
Proceeds from sale of
radio station 3,334,013 -
Net cash provided
by/(used in)
investing activities 3,334,013 (513,075)
Cash flows from
financing activities:
Cash Distribution (2,945,275) -
(Continued on the following page)
</TABLE>
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<CAPTION>
ML MEDIA OPPORTUNITY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE TWENTY-SIX WEEK PERIODS ENDED
JUNE 30, 1995 (UNAUDITED)
AND JUNE 30, 1994 (UNAUDITED)
June 30, June 30,
Notes 1995 1994
<S> <C> <C> <C>
Net decrease in cash
and cash equivalents (476,140) (1,314,147)
Cash and cash
equivalents at
beginning of year 2,150,473 3,739,678
Cash and cash
equivalents at end of
period $ 1,674,333 $ 2,425,531
Supplemental Disclosure:
Effective February 21, 1995, the Partnership sold the assets of
radio station WMXN-FM.
</TABLE>
See Notes to Consolidated Financial Statements (Unaudited).
ML MEDIA OPPORTUNITY PARTNERS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE TWENTY-SIX WEEK PERIOD ENDED JUNE 30, 1995 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ML Media Opportunity Partners, L.P. (the "Partnership"), was
formed and the Certificate of Limited Partnership was filed under
the Delaware Revised Uniform Limited Partnership Act on June 23,
1987. Operations commenced on March 23, 1988 with the first
closing of the sale of units of limited partnership interest.
Media Opportunity Management Partners (the "General Partner") is
a joint venture, organized as a general partnership under New
York law, between RP Opportunity Management, L.P., a limited
partnership under Delaware law, and ML Opportunity Management
Inc., a Delaware corporation and an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. The General Partner was
formed for the purpose of acting as general partner of the
Partnership. The General Partner's total capital contribution
was $1,132,800 at December 31, 1994 which represents 1% of the
total Partnership capital contributions.
Pursuant to the terms of the Amended and Restated Agreement of
Limited Partnership, the General Partner is liable for all
general obligations of the Partnership to the extent not paid by
the Partnership. The limited partners are not liable for the
obligations of the Partnership in excess of the amount of their
contributed capital.
The purpose of the Partnership is to acquire, finance, hold,
develop, improve, maintain, operate, lease, sell, exchange,
dispose of and otherwise invest in and deal with media businesses
and direct and indirect interests therein.
Certain 1994 items have been reclassified to conform to 1995
presentation.
In the opinion of the General Partner, the financial statements
include all adjustments necessary to reflect fairly the results
of the interim periods presented. All adjustments are of a
normal recurring nature, except as disclosed in Note 3.
Additional information, including the audited year end 1994
Financial Statements and the Summary of Significant Accounting
Policies, is included in the Partnership's filing on Form 10-K
for the year ended December 31, 1994 on file with the Securities
and Exchange Commission.
Statement of Financial Accounting Standards No. 112
Effective January 1, 1994, the Partnership adopted Statement of
Financial Accounting Standards No. 112, "Employers' Accounting
for Postemployment Benefits" ("SFAS No. 112"). This
pronouncement establishes accounting standards for employers who
provide benefits to former or inactive employees after
employment, but before retirement. These benefits include, but
are not limited to, salary-continuation, disability related
benefits including workers' compensation, and continuation of
health care and life insurance benefits. The statement requires
employers to accrue the obligations associated with service
rendered to date for employee benefits accumulated or vested
where payment is probable and can be reasonably estimated. The
effect of the adoption of SFAS No. 112 was not material to the
Partnership's financial position or results of operations.
2. Liquidity
At June 30, 1995, the Partnership had $1,674,333 in cash and cash
equivalents.
The Partnership consummated the sale of WMXN-FM on February 21,
1995 (see below), and made a cash distribution to Limited
Partners of $26 per unit from the net distributable sales
proceeds.
The Partnership is currently marketing TCS for potential sale in
1995 and, on June 30, 1995, entered into an agreement to sell the
stock of Avant Development Corporation, the corporation which
owns television station WRBL-TV (see below).
During 1995, the Partnership will attempt to sell or otherwise
dispose of all of its remaining investments in media properties,
and then liquidate; however, there can be no assurance that the
Partnership will be successful in completing such actions prior
to December 31, 1995. The status of all of the Partnership's
investments is discussed in more detail below.
Sale of WMXN-FM
The Partnership entered into an Option Agreement, effective
January 25, 1994, with US Radio , Inc. ("US Inc."), a Delaware
corporation, and an affiliated entity, US Radio, L.P. ("US
Radio"), a Delaware limited partnership, neither of which is
affiliated with the Partnership. Pursuant to the Option
Agreement, the Partnership granted US Inc. an option (the
"Call"), exercisable at any time prior to January 15, 1995, to
purchase substantially all of the assets of WMXN-FM (the
"Assets") for a cash price of $3.5 million. On September 23,
1994, US Inc. exercised the Call. On October 24, 1994, the
Partnership and US Radio of Norfolk, Inc. ("US Norfolk"), an
affiliate of US Inc. to which US Inc. assigned its option to
purchase WMXN-FM, filed an application with the FCC requesting
assignment of the license of WMXN-FM from the Partnership to US
Norfolk pursuant to the terms of an Asset Purchase Agreement.
Following receipt of FCC approval, on February 21, 1995, US
Norfolk purchased WMXN-FM for approximately $3.5 million, subject
to future adjustment based on a post-closing accounting
reconciliation between US Norfolk and the Partnership required by
the Asset Purchase Agreement. The Partnership does not currently
anticipate that such potential future adjustment will be
material. Following payment of a transaction fee to a third
party unaffiliated with the Partnership, approximately $3.3
million was remitted to the Partnership. In addition, on March
7, 1995, approximately $400,000 was returned to the Partnership
from WMXN-FM's cash balances.
Effective January 31, 1994, the Partnership entered into a Time
Brokerage Agreement (the "LMA") with US Radio. The LMA called
for the Partnership to make broadcasting time available on WMXN-
FM to US Radio and for US Radio to provide radio programs to be
broadcast on WMXN-FM, subject to certain terms and conditions,
including the rules and regulations of the FCC. In exchange for
providing broadcasting time to US Radio, the Partnership received
a monthly fee approximately equal to its cost of operating WMXN-
FM. The LMA continued until the consummation of the acquisition
of WMXN-FM by US Norfolk.
TCS
TCS was in default of covenants under its note agreements as of
June 30, 1995, and had failed to make scheduled principal
payments totaling $3,450,000 as of June 30, 1995. TCS also
expects to default on the majority of its scheduled principal
payments for the remainder of 1995. TCS engaged in discussions
with its note holders regarding a potential restructuring of
TCS's note agreements, but ultimately decided to pursue a sale of
the TCS stations. The Partnership engaged Furman Selz
Incorporated to assist in marketing the TCS television stations
for sale. The marketing of the sale of such stations commenced
in December of 1994. It is the Partnership's intention to
actively pursue a sale of the TCS television stations. On
January 13, 1995, the Partnership entered into a non-binding
letter of intent to sell the stock of Avant Development
Corporation ("Avant"), a 100%-owned corporate subsidiary of TCS,
Inc. which owns WRBL-TV.
On June 20, 1995, TCS Inc. (a wholly-owned subsidiary of TCS)
entered into a Stock Purchase Agreement (the "Stock Purchase
Agreement") with The Spartan Radiocasting Company (the "Buyer")
providing for the sale to the Buyer of all of the outstanding
shares (the "Shares") of capital stock of Avant for a base
purchase price of $20,850,000, subject to certain adjustments,
including an adjustment with respect to the working capital of
Avant. In addition, the Buyer will pay TCS Inc. $1,500,000 for a
covenant-not-to-compete with the Buyer. It is expected that the
entire proceeds of the sale, after application to the expenses
and liabilities relating to the sale, will be applied to repay
indebtedness of TCS which is secured by a pledge of the Shares
and the shares of Fabri Development Corporation, another 100%-
owned subsidiary of TCS Inc. which owns and operates KQTV, St.
Joseph, Missouri, and WTWO-TV Terre Haute, Indiana. Consummation
of the sale pursuant to the Stock Purchase Agreement is subject
to the satisfaction of certain conditions, including obtaining
approvals from TCS' lenders and the Federal Communications
Commission.
During the process of marketing the TCS television stations,
while TCS remains in default, the note holders have the option to
exercise their rights under the notes, which rights include the
right to foreclose on the stock of the operating subsidiaries
that own the three TCS stations, but not the other assets of the
Partnership. Whether or not the Partnership is able to sell the
TCS television stations, it is unlikely that the Partnership will
recover more than a nominal amount of its investment in TCS.
The Partnership is still actively pursuing a sale of the Fabri
television stations which own KQTV and WTWO-TV.
Paradigm
Paradigm and/or BBAD are not currently producing television
programs, and the Partnership has not advanced any funds to
Paradigm and/or BBAD since the second quarter of 1992. Paradigm
and/or BBAD took several steps in 1992 and 1993 to reduce
operating costs, primarily by reducing the number, and
compensation, of employees. However, Paradigm and/or BBAD did not
operate profitably during 1993, and were dependent on outside
sources, primarily Bob Banner Associates Inc. ("Associates"), to
finance BBAD's monthly operating costs. The Partnership elected
not to fund such operating costs. The Partnership has no
obligation to advance any additional funds to Paradigm and/or
BBAD and actively sought a strategic partner that would share in
meeting Paradigm's and/or BBAD's potential future funding needs
but was unable to identify such a partner. Paradigm and/or BBAD
have no liability for borrowed funds. The Partnership has
entered into an agreement with Associates under which Paradigm
retains the three television movies and the series developed by
it, and the other projects and program concepts developed by
Paradigm and/or BBAD were assigned to Associates, and Paradigm
retained a percentage interest in all such projects and concepts.
It is the Partnership's intention to attempt to sell its interest
in the Paradigm and/or BBAD programs and projects. However, it
is unlikely that the Partnership will recover more than a nominal
portion, if any, of its original investment in Paradigm and/or
BBAD.
Investments and EMP, Ltd.
Investments, MVT, EMP, Ltd. and their affiliates are currently
reliant on their cash balances, existing operations, and/or
additional funding from ALP Enterprises or other, as yet
unidentified, financing sources to fund their continuing
operations. The Partnership expects to advance no further funds
to Investments, MVT or their affiliates beyond those funds
already advanced by the Partnership.
Effective August 12, 1994, the Partnership and EMP, Ltd.
restructured the ownership of EMP, Ltd. and certain of its
subsidiaries in order to enable EMP, Ltd. to attract additional
capital from ALP Enterprises and other potential third party
investors. In the restructuring, based on certain
representations from EMP, Ltd. and ALP Enterprises, the
Partnership sold to Clarendon and ALP Enterprises for nominal
consideration the Partnership's shares in EMP, Ltd.
Simultaneously, the Partnership and EMP, Ltd. entered into an
agreement whereby EMP, Ltd.'s 10% interest in Teletext was
transferred, together with a "pound" 350,000 loan (approximately $543,000
at then-current exchange rates) from EMP, Ltd. to a newly formed
entity, MV Technology Limited ("MVT"). After the transfer, the
Partnership owns 13.8% of the issued common shares of MVT, while
EMP, Ltd. owns the remaining 86.2%. MVT's sole purpose is to
manage its 10% interest in Teletext. The Partnership has the
right to require EMP, Ltd. to purchase the Partnership's interest
in MVT at any time between December 31, 1994 and December 31,
1997. EMP, Ltd. has the right to require the Partnership to sell
the Partnership's interest in MVT to EMP, Ltd. at any time
between September 30, 1995 and September 30, 1998. MVT will pay
an annual fee to EMP, Ltd. for management services provided by
EMP, Ltd. in connection with overseeing MVT's investment in
Teletext. Following the restructuring, the Partnership no longer
has any interest in EMP, Ltd. The Partnership elected not to
advance further funds to investments or MVT. During the second
quarter of 1995, MVT made dividend distributions to the
Partnership totaling approximately $33,000. However, it is
likely the Partnership will not recover the majority of its $2
million investment in Investments either from Investments or from
MVT.
IMP/Intelidata
Effective July 1, 1993, the Partnership entered into three
transactions to sell the business and assets of IMPLP/IMPI and
Intelidata. In two separate transactions, the Partnership sold
the entire business and substantially all of the assets of
IMPLP/IMPI and a portion of the business and assets of Intelidata
to Phillips Business Information, Inc. ("PBI") for future
consideration based on the revenues of IMPLP/IMPI and the portion
of the Intelidata business acquired by PBI. PBI is not
affiliated with the Partnership. At closing, PBI made advances
of $100,000 and $150,000 to IMPLP/IMPI and Intelidata,
respectively, which advances would be recoverable by PBI from any
future consideration payable by PBI to the Partnership. In
addition, PBI agreed to assume certain liabilities of IMPLP/IMPI
and Intelidata.
In the third transaction, the Partnership sold the remaining
business and assets of Intelidata, which were not sold to PBI, to
Romtec plc ("Romtec") in exchange for future consideration, based
on both the amount of assets and liabilities transferred to
Romtec and the combined profits of the portion of the Intelidata
business acquired by Romtec and another, existing division of
Romtec. In addition, certain liabilities of Intelidata were
assumed by Romtec. Romtec is not affiliated with the
Partnership.
As a result of the above transactions, the Partnership recorded a
writedown of approximately $364,000 of certain assets of
IMPLP/IMPI/Intelidata in the second quarter of 1993 to reduce the
Partnership's net investment to a net realizable value of zero.
Subsequent to the sale of the businesses, the Partnership
advanced net additional funds totaling approximately $0.1 million
to IMPLP/IMPI and Intelidata to fund cash shortfalls resulting
from the pre-sale claims of certain creditors. The Partnership
anticipates that it may make additional such advances to
IMPLP/IMPI and Intelidata during 1995. The total of any
Partnership obligations to fund such advances, including certain
contractual obligations, is not currently anticipated to exceed
the amount of the writedown. It is unlikely that the Partnership
will recover any portion of its investment in
IMPLP/IMPI/Intelidata.
GCC/WWC
On January 20, 1994, the majority stockholders of GCC and certain
holders of interest in MARKETS Cellular Limited Partnership
("Markets"), and PN Cellular, Inc. ("PNCI") executed a Memorandum
of Intention (the "Memorandum") pursuant to which the parties
thereto expressed their intent to effect a proposed business
combination of GCC and Markets.
The Partnership executed an Exchange Agreement and Plan of Merger
("Agreement"), dated July 20, 1994, to which the majority
stockholders of GCC and the majority owners of Markets are
parties. Pursuant to the Agreement, the Partnership exchanged
its shares in GCC for an equal number of shares in Western
Wireless Corporation ("WWC"), a new company which was organized
to own the equity interests of GCC and Markets. Following the
consummation of the business combination on July 29, 1994, WWC
became the owner of 100% of the partnership interests in Markets
and approximately 95% of the outstanding common stock of GCC.
WWC holds and operates cellular licenses covering approximately
5.6 million net pops (defined as the population in an area
covered by a cellular franchise) including pending acquisitions.
As of June 30, 1995, the Partnership's 351,665 shares in WWC
represented an ownership percentage equal to approximately 2.4%.
Summary
In summary of the Partnership's liquidity status, the
approximately $1.7 million that the Partnership has available for
working capital is not sufficient to meet all of the contractual
debt obligations of all of its investments, nor is it obligated
to do so. The Partnership has no contractual commitment to
advance funds to any of its investments, other than its
obligation to fund cash shortfalls resulting from pre-sale claims
related to its former investments in IMPLP/IMPI and Intelidata.
3. DISCONTINUED OPERATIONS
Television and Radio Station Segment
Due to the disposition of WMXN-FM on February 21, 1995 and the
Partnership's decision to sell TCS (see Note 2), the Partnership
has presented its Television and Radio Station Segment (comprised
of WMXN-FM and TCS) as discontinued operations. The June 30,
1994 Consolidated Statement of Operations and Consolidated
Statement of Cash Flows, have each been restated to present such
discontinued operations.
The net liabilities of discontinued operations of this segment on
the Consolidated Balance Sheets are comprised of the following:
<TABLE>
<CAPTION>
As of As of
June 30, December 31,
1995 1994
<S> <C> <C>
Property, plant and
equipment, net $ 5,397,921 $ 5,833,854
Intangible assets, net 33,545,402 35,616,068
Other assets 15,738,541 14,597,378
Borrowings (42,999,804) (42,999,804)
Other liabilities (19,468,791) (19,184,542)
Net liabilities of
discontinued operations $ (7,786,731) $ (6,137,046)
</TABLE>
The change in the net liabilities of this segment is due
primarily to the sale of WMXN-FM on February 21, 1995.
Summarized results of the discontinued operations of this segment
on the Consolidated Statements of Operations are as follows:
<TABLE>
<CAPTION>
Thirteen Twenty-Six
Weeks Ended Weeks Ended
June 30, 1994 June 30, 1994
<S> <C> <C>
Operating Revenues $ 3,667,089 $ 7,085,398
Less: Operating Expenses 3,199,730 6,527,120
Operating Income 467,359 558,278
Interest Expense (1,296,486) (2,576,217)
Loss from discontinued
operations $ (829,127) $(2,017,939)
</TABLE>
The Partnership expects to continue to recognize gains on the
disposition of each station comprising its Television and Radio
Station Segment.
Cable Television Systems Segment
Due to the disposition of Windsor and Maryland Cable in 1994, the
results of the Cable Television Segment (comprised of Windsor and
Maryland Cable) have been reported separately in the June 30,
1994 Consolidated Statements of Operations and the consolidated
statement of cash flows as discontinued operations.
Summarized results of discontinued operations of this segment on
the Consolidated Statement of Operations are as follows:
<TABLE>
<CAPTION>
Thirteen Twenty-Six
Weeks Ended Weeks Ended
June 30, 1994 June 30, 1994
<S> <C> <C>
Operating Revenues $ - $10,730,711
Less: Operating Expenses - 9,750,040
Operating Income 980,671
Interest Expense - (7,765,653)
Loss from discontinued operations $ - $(6,784,982)
</TABLE>
Production Segment
Due to the expected disposition of Paradigm in 1995, the
Partnership's Production Segment is presented as discontinued
operations. The June 30, 1994 Consolidated Statement of
Operations and Consolidated Statement of Cash Flows have each
been restated to present such discontinued operations.
The net liabilities of the discontinued operations of this
segment on the Consolidated Balance Sheets are comprised of the
following:
<TABLE>
<CAPTION>
As of As of
June 30, December 31,
1995 1994
<S> <C> <C>
Cash $ 62,695 $ 105,650
Accounts payable and
accrued liabilities (203,406) (246,361)
Net liabilities of
discontinued operations $ (140,711) $ (140,711)
</TABLE>
Summarized results of the discontinued operations of this segment
on the Consolidated Statements of Operations are as follows:
<TABLE>
<CAPTION>
Thirteen Twenty-Six
Weeks Ended Weeks Ended
June 30, 1994 June 30, 1994
<S> <C>
Operating Revenues $ 901 $ 1,806
Less: Operating Expenses 5,949 11,943
Operating Loss (5,048) (10,137)
Minority Interest 163 (168)
Loss from discontinued
operations $ (4,885) $ (10,305)
</TABLE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Liquidity and Capital Resources
At June 30, 1995, Registrant had $1,674,333 in cash and cash
equivalents.
Registrant consummated the sale of WMXN-FM on February 21, 1995
(see below), and made a cash distribution to Limited Partners of
$26 per unit from the net distributable sale proceeds.
Registrant is currently marketing TCS for potential sale in 1995
and, on June 30, 1995, entered into an agreement to sell the
stock of Avant Development Corporation, the corporation which
owns television station WRBL-TV (see below).
During 1995, Registrant will attempt to sell or otherwise dispose
of all of its remaining investments in media properties, and then
liquidate; however, there can be no assurance that Registrant
will be successful in completing such actions prior to December
31, 1995.
In summary of Registrant's liquidity status, the approximately
$1.7 million that Registrant has available for working capital is
not sufficient to meet all of the contractual debt obligations of
all of its investments, nor is it obligated to do so. Registrant
has no contractual commitment to advance funds to any of its
investments, other than its obligation to fund cash shortfalls
resulting from pre-sale claims related to its former investments
in IMPLP/IMPI and Intelidata.
WMXN-FM
Registrant entered into an Option Agreement, effective January
25, 1994, with US Radio , Inc. ("US Inc."), a Delaware
corporation, and an affiliated entity, US Radio, L.P. ("US
Radio"), a Delaware limited partnership, neither of which is
affiliated with Registrant. Pursuant to the Option Agreement,
Registrant granted US Inc. an option (the "Call"), exercisable at
any time prior to January 15, 1995, to purchase substantially all
of the assets of WMXN-FM (the "Assets") for a cash price of $3.5
million. On September 23, 1994, US Inc. exercised the Call. On
October 24, 1994, Registrant and US Radio of Norfolk, Inc. ("US
Norfolk"), an affiliate of US Inc. to which US Inc. assigned its
option to purchase WMXN-FM, filed an application with the FCC
requesting assignment of the license of WMXN-FM from Registrant
to US Norfolk pursuant to the terms of an Asset Purchase
Agreement.
Following receipt of FCC approval, on February 21, 1995, US
Norfolk purchased WMXN-FM for approximately $3.5 million, subject
to future adjustment based on a post-closing accounting
reconciliation between US Norfolk and Registrant required by the
Asset Purchase Agreement. Registrant does not currently
anticipate that such potential future adjustment will be
material. Following payment of a transaction fee to a third party
not affiliated with Registrant or its affiliates, approximately
$3.3 million was remitted to Registrant. In addition, on March
7, 1995, approximately $400,000 was returned to Registrant from
WMXN's cash balances.
Effective January 31, 1994, Registrant entered into a Time
Brokerage Agreement (the "LMA") with US Radio. The LMA called
for Registrant to make broadcasting time available on WMXN-FM to
US Radio and for US Radio to provide radio programs to be
broadcast on WMXN-FM, subject to certain terms and conditions,
including the rules and regulations of the FCC. In exchange for
providing broadcasting time to US Radio, Registrant received a
monthly fee approximately equal to its cost of operating WMXN-FM.
The LMA continued until the consummation of the acquisition of
WMXN-FM by US Norfolk.
TCS
As of June 30, 1995, TCS was in default of covenants under its
note agreements and had failed to make scheduled principal
payments totaling $3,450,000 as of June 30, 1995. In addition,
TCS expects to default on the majority of its scheduled principal
payments for the remainder of 1995. TCS engaged in discussions
with its note holders, but ultimately decided to pursue a sale of
the TCS stations. Registrant engaged Furman Selz Incorporated to
assist in marketing the TCS stations for sale. The marketing of
the sale of such stations commenced in December of 1994. It is
Registrant's intention to actively pursue a sale of the TCS
television stations. On January 13, 1995, Registrant entered
into a non-binding letter of intent to sell the stock of Avant
Development Corporation ("Avant"), a 100%-owned corporate
subsidiary of TCS, Inc. which owns WRBL-TV.
On June 20, 1995, TCS Inc. (a wholly-owned subsidiary of TCS)
entered into a Stock Purchase Agreement (the "Stock Purchase
Agreement") with The Spartan Radiocasting Company (the "Buyer")
providing for the sale to the Buyer of all of the outstanding
shares (the "Shares") of capital stock of Avant for a base
purchase price of $20,850,000, subject to certain adjustments,
including an adjustment with respect to the working capital of
Avant. In addition, the Buyer will pay TCS Inc. $1,500,000 for a
covenant-not-to-compete with the Buyer. It is expected that the
entire proceeds of the sale, after application to the expenses
and liabilities relating to the sale, will be applied to repay
indebtedness of TCS which is secured by a pledge of the Shares
and the shares of Fabri Development Corporation, another 100%-
owned subsidiary of TCS Inc. which owns and operates KQTV, St.
Joseph, Missouri, and WTWO-TV Terre Haute, Indiana. Consummation
of the sale pursuant to the Stock Purchase Agreement is subject
to the satisfaction of certain conditions, including obtaining
approvals from TCS' lenders and the Federal Communications
Commission.
During the process of marketing the TCS television stations,
while TCS remains in default, the note holders have the option to
exercise their rights under the notes, which rights include the
right to foreclose on the stock of the operating subsidiaries
that own the three TCS stations, but not the other assets of
Registrant. It is unlikely that Registrant will recover more
than a nominal amount of its investment in TCS.
Registrant is still actively pursuing a sale of the Fabri
television stations which own KQTV and WTWO-TV.
Paradigm
Paradigm and/or BBAD are not currently producing television
programs, and Registrant has not advanced any funds to Paradigm
and/or BBAD since the second quarter of 1992. Paradigm and/or
BBAD took several steps in 1992 and 1993 to reduce operating
costs, primarily by reducing the number, and compensation, of
employees. However, Paradigm and/or BBAD did not operate
profitably during 1993, and were dependent on outside sources,
primarily Bob Banner Associates Inc. ("Associates"), to finance
BBAD's monthly operating costs. Registrant elected not to fund
such operating costs. Registrant has no obligation to advance
any additional funds to Paradigm and/or BBAD and actively sought
a strategic partner that would share in meeting Paradigm's and/or
BBAD's potential future funding needs, but was unable to identify
such a partner. Registrant has entered into an agreement with
Associates under which Paradigm retains the three television
movies and the series developed by it, and the other projects and
program concepts developed by Paradigm and/or BBAD were assigned
to Associates, and Paradigm retained a percentage interest in all
such projects and concepts. It is Registrant's intention to
attempt to sell its interest in the Paradigm and/or BBAD programs
and projects. However, it is unlikely that Registrant will
recover more than a nominal portion, if any, of its original
investment in Paradigm and/or BBAD.
Investments and EMP, Ltd. and MVT
Investments, MVT, EMP, Ltd. and their affiliates are currently
reliant on their cash balances, existing operations, and/or
additional funding from ALP Enterprises or other, as yet
unidentified, financing sources to fund their continuing
operations. Registrant expects to advance no further funds to
Investments, MVT, or their affiliates beyond those funds already
advanced by Registrant.
Effective August 12, 1994, Registrant and EMP, Ltd. restructured
the ownership of EMP, Ltd. and certain of its subsidiaries in
order to enable EMP, Ltd. to attract additional capital from ALP
Enterprises and other potential third party investors. In the
restructuring, based on certain representations from EMP, Ltd.
and ALP Enterprises, Registrant sold to Clarendon and ALP
Enterprises for nominal consideration Registrant's shares in EMP,
Ltd. Simultaneously, Registrant and EMP, Ltd. entered into an
agreement whereby EMP, Ltd.'s 10% interest in Teletext was
transferred, together with a "pound" 350,000 loan (approximately $543,000
at then-current exchange rates) from EMP, Ltd. to a newly formed
entity, MV Technology Limited ("MVT"). After the transfer,
Registrant owns 13.8% of the issued common shares of MVT, while
EMP, Ltd. owns the remaining 86.2%. MVT's sole purpose is to
manage its 10% interest in Teletext. Registrant has the right to
require EMP, Ltd. to purchase Registrant's interest in MVT at any
time between December 31, 1994 and December 31, 1997. EMP, Ltd.
has the right to require Registrant to sell Registrant's interest
in MVT to EMP, Ltd. at any time between September 30, 1995 and
September 30, 1998. MVT will pay an annual fee to EMP, Ltd. for
management services provided by EMP, Ltd. in connection with
overseeing MVT's investment in Teletext. Following the
restructuring, Registrant no longer has any interest in EMP, Ltd.
Registrant elected not to advance further funds to Investments or
MVT. During the second quarter of 1995, MVT made dividend
distributions to Registrant totaling approximately $33,000.
However, it is likely that Registrant will not recover the
majority of its $2 million investment in Investments either from
Investments or from MVT.
IMP/Intelidata
Effective July 1, 1993, Registrant entered into three
transactions to sell the business and assets of IMPLP/IMPI and
Intelidata. In two separate transactions, Registrant sold the
entire business and substantially all of the assets of IMPLP/IMPI
and a portion of the business and assets of Intelidata to
Phillips Business Information, Inc. ("PBI") for future
consideration based on the revenues of IMPLP/IMPI and the portion
of the Intelidata business acquired by PBI. PBI is not
affiliated with Registrant. At closing, PBI made advances of
$100,000 and $150,000 to IMPLP/IMPI and Intelidata, respectively,
which advances would be recoverable by PBI from any future
consideration payable by PBI to Registrant. In addition, PBI
agreed to assume certain liabilities of IMPLP/IMPI and
Intelidata.
In the third transaction, Registrant sold the remaining business
and assets of Intelidata, which were not sold to PBI, to Romtec
plc ("Romtec") in exchange for future consideration, based on
both the amount of assets and liabilities transferred to Romtec
and the combined profits of the portion of the Intelidata
business acquired by Romtec and another, existing division of
Romtec. In addition, certain liabilities of Intelidata were
assumed by Romtec. Romtec is not affiliated with Registrant.
As a result of the above transactions, Registrant recorded a
writedown of approximately $364,000 of certain assets of
IMPLP/IMPI/Intelidata in the second quarter of 1993 to reduce
Registrant's net investment to a net realizable value of zero.
Subsequent to the sale of the businesses, Registrant advanced net
additional funds totaling approximately $0.1 million to
IMPLP/IMPI and Intelidata to fund cash shortfalls resulting from
the pre-sale claims of certain creditors. Registrant anticipates
that it may make additional such advances to IMPLP/IMPI and
Intelidata during 1995. The total of any Registrant obligations
to fund such advances, including certain contractual obligations,
is not currently anticipated to exceed the amount of the
writedown. It is unlikely that Registrant will recover any
portion of its investment in IMPLP/IMPI/Intelidata.
GCC/WWC
On January 20, 1994, the majority stockholders of GCC and certain
holders of interest in MARKETS Cellular Limited Partnership
("Markets"), and PN Cellular, Inc. ("PNCI") executed a Memorandum
of Intention (the "Memorandum") pursuant to which the parties
thereto expressed their intent to effect a proposed business
combination of GCC and Markets.
Registrant executed an Exchange Agreement and Plan of Merger
("Agreement"), dated July 20, 1994, to which the majority
stockholders of GCC and the majority owners of Markets are
parties. Pursuant to the Agreement, Registrant exchanged its
shares in GCC for an equal number of shares in Western Wireless
Corporation ("WWC"), a new company which was organized to own the
equity interests of GCC and Markets. Following the consummation
of the business combination on July 29, 1994, WWC became the
owner of 100% of the Partnership interests in Markets and
approximately 95% of the outstanding common stock of GCC. WWC
holds and operates cellular licenses covering approximately 5.6
million net pops (defined as the population in an area covered by
a cellular franchise) including pending acquisitions.
As of June 30, 1995, Registrant's 351,665 shares in WWC
represented an ownership percentage equal to approximately 2.4%.
Results of Operations
For the thirteen week periods ended June 30, 1995 and June 30,
1994:
Registrant generated a loss from Partnership operations in the
second quarter of 1995 of approximately $0.5 million, which was
comprised primarily of the following components: (1)interest and
other income of approximately $0.2 million, (2) general and
administrative expenses of approximately $0.1 million, and
management fees of approximately $0.6 million.
The loss from Partnership operations decreased from approximately
$0.9 million in the second quarter of 1994 to approximately $0.5
million in the second quarter of 1995 primarily due to reduced
management fees as a result of fewer operating properties in the
second quarter of 1995, and no amortization expense in the second
quarter 1995 due to the full amortization of certain deferred
assets at the end of 1994. In addition, the Partnership
recognized income in the second quarter of 1995 related to
management services it provided to Maryland Cable prior to its
disposition of Maryland Cable.
Registrant's net loss in the second quarter of 1995 of
approximately $0.5 million is not comparable to Registrant's net
loss of approximately $1.7 million in the second quarter of 1994
due primarily to the treatment of its Television and Radio
Station Segment as discontinued operations.
For the twenty-six week periods ended June 30, 1995 and June 30,
1994:
Registrant generated net income for the first half of 1995 of
approximately $0.5 million, which was comprised primarily of a
gain of approximately $1.7 million on the sale of radio station
WMXN-FM, partially offset by management fees of approximately
$1.2 million.
The loss from Partnership operations decreased from approximately
1.7 million for the first two quarters of 1994 to approximately
$1.1 million for the first two quarters of 1995. The decrease is
primarily due to a reduction in management fees paid as a result
of fewer operating properties in the first half of 1995, and no
amortization expense in the first half of 1995 due to the full
amortization of certain deferred assets at the end of 1994. In
addition, Registrant recognized income in the second quarter of
1995 related to management services it provided to Maryland Cable
prior to its disposition of Maryland Cable.
Registrant's net income in the first half of 1995 of
approximately $0.5 million is not comparable to Registrant's net
loss of approximately $10.5 million in the first half of 1994 due
primarily to the disposition of Maryland Cable (which was
Registrant's major operating property) during 1994.
PART II - OTHER INFORMATION
Item 3. Defaults Upon Senior Securities
Reference is hereby made to Part I Item 1. Financial Statements
Footnote 2. Liquidity.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
A). Exhibits:
Exhibit # Description
10.1 Agreement by and among Bob Banner
Associates, Inc. and Paradigm.
27. Financial Data Schedule
B). Reports on Form 8-K
During the period covered by this report, Registrant
filed with the Securities and Exchange Commission a
Current Report on Form 8-K dated June 20, 1995. This
current report contained details regarding the Stock
Purchase Agreement providing for the sale of the capital
stock of Avant Development Corporation.
<PAGE>
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.
ML MEDIA OPPORTUNITY PARTNERS, L.P.
By: RP Opportunity Management, L.P.
General Partner
By: IMP Opportunity Management Inc.
Dated: August 15, 1995 /s/ I. Martin Pompadur
I. Martin Pompadur
Director and President
(principal executive officer
of the Registrant)
<PAGE>
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.
ML MEDIA OPPORTUNITY PARTNERS, L.P.
By: Media Opportunity Management Partners
General Partner
By: ML Opportunity Management Inc.
Dated: August 15, 1995 /s/ Kevin K. Albert
Kevin K. Albert
Director and President
Dated: August 15, 1995 /s/ Robert F. Aufenanger
Robert F. Aufenanger
Director and Executive Vice President
Dated: August 15, 1995 /s/ Diane T. Herte
Diane T. Herte
Treasurer
(principal accounting officer and
principal financial officer
of the Registrant)
AGREEMENT
THIS AGREEMENT made and entered into as of the 31st day of
October, 1993, by and among BOB BANNER ASSOCIATES, INC., a
California corporation ("BBA"), and PARADIGM ENTERTAINMENT, L.P.,
a Delaware limited partnership ("PARADIGM"). BBA and PARADIGM
will hereinafter collectively be referred to as the "Partners" or
individually as a "Partner". The partnership shall be referred
to as BOB BANNER ASSOCIATES DEVELOPMENT ("BBAD").
The Partners hereby agree as follows:
1. Effective January 1, 1992, BBA and PARADIGM formed
BBAD to develop and produce television programming
pursuant to a partnership agreement dated as of
January 1, 1992. No other written agreement
evidencing the terms of the partnership was ever
executed. Tax returns were filed for BBAD for the
year 1992. The Partners have agreed to terminate BBAD
effective December 31, 1993. This agreement is
intended to cover all matters pertaining to the
partnership, and to divide up the assets of the
partnership amongst the Partners, subject to the terms
and conditions provided herein.
2(a) During the period from January 1, 1992, through
October 31, 1993, PARADIGM has made contributions to
BBAD in the sum of $1,239,136.72, and BBA has made
contributions to BBAD in the sum of $1,139,572.24.
These contributions are listed and described in
Exhibits A-1 and A-2, respectively. Based thereon,
the ratio of participation in any BBAD Recoupment
Funds to be received from Seawolf and any unrecouped
development costs, as may become due and available
from any sources under the provisions contained below,
shall be divided 52% to PARADIGM and 48% to BBA.
2(b) The parties acknowledge that certain book adjustments
were made with mutual approval after October 31, 1993,
which affected the respective losses reported by each
of the partners for the calendar year 1993, and which
resulted in changes to the partnership accounts as of
September 30, 1994. Such subsequent actions shall not
affect the application of the percentages as specified
under paragraph 2(a) above.
3(a) BBAD shall render to the Partners a complete list of
all assets and liabilities as of October 31, 1993, not
later than November 30, 1993. BBAD shall specify
therein details regarding any contingent obligations,
including any deferred payments or residuals for which
reserves must be established. The parties shall
mutually agree on the disposition of any non-liquid
assets owned by the Partnership, other than the films
and projects which are covered by this agreement. BBA
shall be entitled to ownership of all furniture and
equipment of BBAD (whether on the books of BBAD or
PARADIGM) in its offices as of October 31, 1993.
3(b) With respect to the various cash and related accounts,
the parties have reviewed the figures from the books
and accounts and verify and agree upon the following:
(i) BBAD is entitled to $27,659.50 from the Seawolf
Account, net of producer's share of payments due
to Fenady Productions.
(ii) As of October 31, 1993, the net assets in the
BBAD account was $53,224.42, representing cash
plus receivables minus liabilities, exclusive of
the Seawolf funds.
(iii) The total of the above two figures is
$80,883.91, and 52% of that amount is
$42,059.63. PARADIGM shall be paid this amount
in cash, on a deferred basis, to the extent and
at such times that cash becomes available to
either party from the following sources:
(1) BBAD cash on hand;
(2) Seawolf funds; and
(3) From any and all BBAD Recoupment Funds
that are received (including both the PARADIGM
and BBA shares thereof) from the properties in
which PARADIGM has an interest under the
settlement agreement until PARADIGM has
recouped said sum of $42,059.63.
(iv) After such recoupment by PARADIGM, BBA shall be
entitled to the next sums received until it has
received $38,824.28.
(v) After such recoupment by BBA, the balance of any
additional sums received shall be divided 52% to
PARADIGM and 48% to BBA.
3(c) BBA represents and warrants that no other BBAD
liabilities exist, and BBA agrees that it shall be
responsible to pay and indemnify and hold PARADIGM
harmless from any obligations of BBAD arising from the
operation of BBAD, subject to the reserve residual
obligation of $27,000 in Seawolf.
4. BBA shall have the right to continue its employees on
the payroll of BBAD until December 31, 1993, for
bookkeeping convenience. If it so elects, BBA shall
provide to BBAD one hundred percent (100%) of the
funds required to cover such payroll, including all
applicable fringes and taxes, which shall not be
deemed contributions to BBAD.
5. PARADIGM has produced three completed films: (1) Yes,
Virginia; (2) A Thousand Heroes (also known as Crash
Landing); and (3) With Murder In Mind (also known as
Savage Intent). These films are and shall be the sole
and exclusive property of PARADIGM, subject to the
applicable contractual and union obligations relating
thereto as provided in Exhibit C attached hereto. BBA
represents and warrants that all obligations relating
to these projects as of this date have been paid, that
it is not aware of any liabilities in respect thereto
except for future residuals arising from future
exhibitions not yet reported, and BBA agrees to pay,
indemnify, and hold PARADIGM harmless in respect to
any such past obligations. PARADIGM shall have sole
responsibility to pay and indemnify and hold BBA
harmless from any claims pursuant to the future
residual obligations as provided in Exhibit C hereto.
Video Challenge and Deadly Affair are also
acknowledged to be the sole property of PARADIGM.
6. BBAD has produced the movie of the week, Seawolf, for
Turner Entertainment, and Turner is the owner of
Seawolf. BBAD is entitled to certain shares of the
revenues derived by Turner from Seawolf, which
revenues shall be deemed BBAD Recoupment Funds, and
any such sums due from Turner shall be paid directly
to PARADIGM and BBA by Turner in accordance with
assignment notices to be sent to Turner, after the
total sums payable under paragraph 3(b)(iii) and (iv)
above have been paid.
7. BBA has submitted to PARADIGM a complete list of all
projects which were developed by BBAD under the
partnership, set forth in Exhibit B attached hereto.
BBA represents and warrants that all of the Exhibits
attached to this agreement and the lists of projects
contained therein include all projects developed by
BBA, BBAD, and PARADIGM during the term of the BBAD
agreement. Both parties have discussed the status of
each of the projects, and the relative contributions
by BBAD to date in comparison to the stage of the
development of the project, future development, and
other factors regarding the packaging and production
of the projects. Based on such discussions, and good
faith negotiations, it has been agreed that such
projects shall either remain with, revert to, or be
assigned to BBA, to be owned solely and exclusively by
BBA, subject to BBA's agreement to pay to PARADIGM the
participations as specifically set forth in Exhibit B.
The parties agree to prepare and execute any further
documents that may be required in order to effectuate the proper
termination of the partnership and the implementation of the
terms of this agreement.
IN WITNESS WHEREOF, the parties have hereunto signed
this agreement on the dates indicated.
BOB BANNER ASSOCIATES, INC.
Dated: 4/19/95 By: s/ Bob Banner
PARADIGM ENTERTAINMENT, L.P.
Dated: 4/14/95 By: s/ I. Martin Pompadur
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> This schedule contains summary financial
information extracted from the quarter ended 1995 Form
10-Q Consolidated Balance Sheets and Consolidated
Statements of Operations as of June 30, 1995, and is
qualified in its entirety by reference to such
financial statements.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUNE-30-1995
<CASH> 1,674
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,986
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (5,422)
<TOTAL-LIABILITY-AND-EQUITY> 2,986
<SALES> 0
<TOTAL-REVENUES> 209
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,205
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,145)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,145)
<DISCONTINUED> 1,684
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 539
<EPS-PRIMARY> 4.77
<EPS-DILUTED> 0
</TABLE>
