FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter ended March 31, 1997
Commission file number 0-16832
IDM Participating Income Company-II
(A California Limited Partnership)
State of California 33-0177934
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organizaion)
2424 S.E. Bristol Street, Suite 200
Newport Beach, California 92660
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (714) 225-7520
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 limited partnership interests outstanding as of March 31, 1997:
200,000
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following financial statements are submitted in the next pages:
PAGE
NUMBER
Balance Sheets - March 31, 1997 and December 31, 1996 4
Statements of Operations - For the Three Months Ended
March 31, 1997 and 1996 5
Statements of Cash Flows - For the Three Months Ended
March 31, 1997 and 1996 6
Notes to Financial Statements 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Overview:
The following discussion should be read in conjunction with the Partnership's
Financial Statements and Notes thereto appearing elsewhere in this Form 10-Q.
The bankruptcy proceeding and the Plan has had, and will continue to have, a
material and substantial impact on the Partnership's liquidity, capital
resources and results of operations, which are discussed below.
Results of Operations:
Comparison of quarter ended March 31, 1997 to March 31, 1996.
Interest income decreased in 1997 as a result of the sale of the Meadow Wood
Village, Ltd. note and junior deed of trust effective September 1, 1996.
Interest continued to accrue at 12.12% through the sale date. For the quarter
ended March 31, 1996, the Partnership recognized interest income of $57,000
related to this loan.
Meadow Wood Village, Ltd. discontinued interest payments in 1996. In the first
quarter of 1996, interest receivable of $77,000 related to the Meadow Wood
Village, Ltd. note was reserved in its entirety.
2
<PAGE>
General and administrative expenses decreased in 1997 as a result of
professional fees incurred for a fair value opinion on the Villa Redondo loan
receivable incurred in 1996. No such costs were incurred in 1997.
Liquidity and Capital Resources:
During the quarter ended March 31, 1997, the Partnership's cash position
increased by the collection of receivables to affiliates and the collection of
interest income. The Partnership is in a liquid position at March 31, 1997 with
cash balances of $707,000 and current liabilities of $17,000. The Partnership
has no plans or commitments for any future capital expenditures.
Inflation:
The Partnership does not expect inflation to be a material factor in its
operations in 1997.
3
<PAGE>
IDM PARTICIPATING INCOME COMPANY - II
(A California Limited Partnership)
BALANCE SHEETS
March 31, 1997 and December 31, 1996
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
-------------- -----------------
<S> <C> <C>
ASSETS
- ------
Cash ............................................... $ 707,000 $ 576,000
Loans to affiliates:
Interest receivable ........................... 8,000 57,000
Principal, less reserve for possible losses
of $8,924,000 at March 31, 1997 and
December 31, 1996 ............................. 415,000 415,000
Receivable from affiliate .......................... 92,000 150,000
---------- ----------
Total Assets ....................................... $1,222,000 $1,198,000
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable ................................... $ 17,000 $ 1,000
Partners' capital:
General Partner .................................... 436,000 436,000
Limited Partners:
200,000 units authorized,
200,000 issued and outstanding ................ 769,000 761,000
---------- ----------
Total Partners' capital ............................ 1,205,000 1,197,000
---------- ----------
Total Liabilities and Partners' capital ........... $1,222,000 $1,198,000
========== ==========
</TABLE>
See accompanying notes
4
<PAGE>
IDM PARTICIPATING INCOME COMPANY - II
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 1997 and 1996
Three Months Ended March 31,
----------------------------
1997 1996
--------- ---------
Interest income .............................. $ 25,000 $ 82,000
General and administrative expenses .......... (17,000) (31,000)
Provision for possible losses ................ 0 (77,000)
--------- ---------
Net income (loss) ............................ $ 8,000 $ (26,000)
========= =========
Net income (loss) allocable to
limited partners .......................... $ 8,000 $ (26,000)
========= =========
Average number of limited
partnership interests outstanding ......... 200,000 200,000
========= =========
Net income (loss) per limited
partnership interest ...................... $ 0.04 $ (0.13)
========= =========
See accompanying notes
5
<PAGE>
IDM PARTICIPATING INCOME COMPANY - II
(A California Limited Partnership)
STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 1997 and 1996
Three Months
Ended March 31,
1997 1996
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) ..................................... $ 8,000 $(26,000)
Adjustments to reconcile net income (loss)
to cash provided by (used in) operating activities:
Decrease (increase) in interest receivable ......... 49,000 (58,000)
Decrease in receivable from affiliate .............. 58,000 0
Provision for possible losses ...................... 0 77,000
Increase in accounts payable ....................... 16,000 0
-------- --------
Net cash provided by (used in) operating activities
operating activities .............................. 131,000 (7,000)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Collections of loans from affiliates .................. 0 0
-------- --------
Net cash provided by investing activities .......... 0 0
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners ............................. 0 0
-------- --------
Net cash used in financing activities ............... 0 0
-------- --------
NET INCREASE IN CASH .................................... 131,000 (7,000)
Cash beginning of period ............................. 576,000 14,000
-------- --------
Cash end of period ................................... $707,000 $ 7,000
======== ========
6
<PAGE>
IDM PARTICIPATING INCOME COMPANY-II
A California Limited Partnership
Notes to Financial Statements
BASIS OF FINANCIAL STATEMENTS
In the opinion of the Partnership's management, these unaudited financial
statements reflect all adjustments which are necessary for a fair presentation
of its financial position at March 31, 1997 and results of operations and cash
flows for the periods presented. All adjustments included in these statements
are of a normal and recurring nature. These financial statements should be read
in conjunction with the financial statements and notes thereto contained in the
Form 10-K of the Partnership for the year ended December 31, 1996.
7
<PAGE>
PART IV - OTHER INFORMATION
ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS:
The following Exhibits are filed herewith pursuant to Rule 601 of Regulation
S-K.
(27) Financial Data Schedule
B. REPORTS ON FORM 8-K
None.
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.
IDM PARTICIPATING INCOME COMPANY-II,
a California Limited Partnership
IDM PARTICIPATING INCOME CORPORATION
General Partner of the General Partner
Date: April 30, 1997 /s/ STEVEN M. SPEIER
Steven M. Speier
President and Director
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE FOLLOWING FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM IDM PARTICIPATING INCOME COMPANY - II MARCH 31, 1997 FINANCIAL
STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 707,000
<SECURITIES> 0
<RECEIVABLES> 515,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 100,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,222,000
<CURRENT-LIABILITIES> 17,000
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,205,000
<TOTAL-LIABILITY-AND-EQUITY> 1,222,000
<SALES> 0
<TOTAL-REVENUES> 25,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 17,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 8,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 8,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,000
<EPS-PRIMARY> .04
<EPS-DILUTED> .04
</TABLE>
