SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant To Section 13 Or 15(d) of the Securities Exchange
Act of 1934
For the Quarterly Period Ended September 30, 1994
Or
[ ] Transition Report Pursuant To Section 13 Or 15(d) of the Securities Exchange
Act of 1934
For the transition period from to
Commission file number 0-17198
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Oklahoma 73-1329487
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Meridian Tower, Suite 1060
5100 East Skelly Drive
Tulsa, Oklahoma 74135
(Address of principal executive offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: (918) 663-2500
Not applicable
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
<PAGE>
INDEX
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
Balance Sheets as of September 30, 1994 (Unaudited) and December 31, 1993
Schedule of Portfolio Investments as of September 30, 1994 (Unaudited)
Statements of Operations for the Three and Nine Months Ended September 30, 1994
and 1993 (Unaudited)
Statements of Cash Flows for the Nine Months Ended September 30, 1994 and 1993
(Unaudited)
Statement of Changes in Partners' Capital for the Nine Months Ended September
30, 1994 (Unaudited)
Notes to Financial Statements (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Item 2. Changes in Securities.
Item 3. Defaults upon Senior Securities.
Item 4. Submission of Matters to a Vote of Security Holders.
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
BALANCE SHEETS
<TABLE>
September 30, 1994 December 31,
(Unaudited) 1993
<S> <C> <C>
ASSETS
Investments - Note 2
Portfolio investments, at fair value (cost $6,457,034 at
September 30, 1994 and $6,063,931 at December 31, 1993) $ 11,153,887 $ 6,563,579
Short-term investments, at amortized cost 748,918 997,743
Cash and cash equivalents 386,998 880,833
Accrued interest and other receivables 35,694 34,781
Deferred organizational costs, net of accumulated amortization
of $41,754 - Note 2 - 5,964
- -----
TOTAL ASSETS $ 12,325,497 $ 8,482,900
= ========== = =========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable $ 25,150 $ 60,264
Due to Management Company - Note 4 57,843 46,704
Due to Independent General Partners - Note 6 15,000 15,000
------ ------
Total liabilities 97,993 121,968
------ -------
Partners' Capital:
Managing General Partner 75,307 78,613
Individual General Partners 2,910 3,038
Limited Partners (10,248 Units) 7,452,434 7,779,633
Unallocated net unrealized appreciation of investments - Note 2 4,696,853 499,648
--------- -------
Total partners' capital 12,227,504 8,360,932
---------- ---------
TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 12,325,497 $ 8,482,900
= ========== = =========
</TABLE>
See notes to financial statements.
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
SCHEDULE OF PORTFOLIO INVESTMENTS (UNAUDITED)
SEPTEMBER 30, 1994
<TABLE>
Initial Investment
Company / Position Date Cost Fair Value
<S> <C> <C> <C>
Americo Publishing, Inc.
10% Demand Promissory Notes Feb. 1994 $ 225,000 $ 225,000
- --------------------------- --------- - ------- - -------
BACE Manufacturing, Inc.*
1,078 shares of Preferred Stock Feb. 1992 539,000 1,931,200
- ------------------------------- --------- ------- ---------
C.R. Anthony Company
275,317 shares of Common Stock Oct. 1992 600,191 600,191
- ------------------------------ --------- ------- -------
CytoDiagnostics, Inc.*(B)
497,054 shares of Preferred Stock May 1991 921,305 2,137,332
Warrant to purchase 12,539 shares of Common Stock
at $4.30 per share, expiring 10/18/98 0 0
------------------------------------- - -
Data Critical Corp.*(B)(C)
75,000 shares of Preferred Stock April 1993 150,000 150,000
8% Promissory Note due 4/6/95 350,000 350,000
Warrant to purchase 87,500 shares of Common Stock
at $4 per share, expiring 10/6/97 0 0
--------------------------------- - -
Diagnetics, Inc.*(B)(D)
314,807 shares of Preferred Stock April 1991 800,582 800,582
10,006 shares of Common Stock 13,028 13,028
- ----------------------------- ------ ------
Eckerd Corporation*(A)
15,491 shares of Common Stock July 1992 142,992 357,610
- ----------------------------- --------- ------- -------
Enerpro International, Inc.
35,000 shares of Preferred Stock Aug. 1993 350,000 350,000
- -------------------------------- --------- ------- -------
Envirogen, Inc.(A)
150,000 shares of Common Stock Sept. 1991 525,000 350,700
90,000 Warrants to purchase 45,000 shares of Common
Stock at $5.20 per share, expiring 10/13/98 0 14,895
------------------------------------------- - ------
Excel Energy Technologies, Ltd.(B)
16,304 shares of Preferred Stock Oct. 1993 500,000 500,000
17,336 shares of Common Stock 2,500 2,500
- ----------------------------- ----- -----
Great Outdoors Publishing, Inc.*(B)
275,000 shares of Preferred Stock Aug. 1992 275,000 75,000
8% Demand Promissory Notes 50,000 50,000
- -------------------------- ------ ------
Independent Gas Company Holdings, Inc.*
400 shares of Preferred Stock June 1993 400,000 400,000
3,336 shares of Common Stock 3,336 3,336
10% Promissory Note due 2/20/95 14,100 14,100
- ------------------------------- ------ ------
</TABLE>
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
SCHEDULE OF PORTFOLIO INVESTMENTS (UNAUDITED) - CONTINUED
SEPTEMBER 30, 1994
<TABLE>
Initial Investment
Company / Position Date Cost Fair Value
- ------------------ ---- ---- ----------
<S> <C> <C> <C>
QuanTem Laboratories, Inc.*(B)
42,589 shares of Preferred Stock Jan. 1990 $ 75,000 $ 20,000
5,000 shares of Common Stock 0 0
- ---------------------------- - -
Silverado Foods, Inc.* (A)(B)(E)
683,181 shares of Common Stock June 1992 520,000 2,728,454
Warrant to purchase 22,500 shares of Common Stock
at $0.44 per share, expiring 1/19/98 0 79,959
Warrant to purchase 12,121 shares of Common Stock
at $8.25 per share, expiring 6/2/99 0 0
----------------------------------- - -
TOTALS $ 6,457,034 $ 11,153,887
= ========= = ==========
</TABLE>
(A) Public company
(B) Qualifies as an "Oklahoma business venture" under Oklahoma law.
(C) During the quarter, the Partnership purchased promissory notes of Data
Critical Corp. for $175,000. Additionally, in connection with a debt
restructuring, the Partnership exchanged its 8% and 10% notes
aggregating $350,000 in face value and its warrant to purchase 17,500
shares of common stock at $5 per share for a $350,000 8% promissory
note and a warrant to purchase 87,500 shares of common stock at $4 per
share.
(D) On July 1, 1994, the Partnership invested $50,000 in Diagnetics, Inc.
for a convertible promissory note. On July 22, 1994, the Partnership
converted its promissory notes aggregating $250,000 in face value and
accrued interest of $12,812 into 189,073 preferred shares of
Diagnetics. In addition, the Partnership exchanged its warrants and
accrued dividends of $35,770 into 25,734 preferred shares of
Diagnetics.
(E) On August 4, 1994, Silverado Foods, Inc. completed its initial public
offering. In connection with the offering, the Partnership converted
its preferred shares into common shares of the company and the company
effected a 2.25-for-1 split of its outstanding stock. As a result, the
Partnership exchanged its 267,144 preferred shares for 638,181 common
shares and converted its $20,000 subordinated note into 45,000 common
shares of the company. The $180,000 9% senior note and the $100,000 9%
promissory note were repaid with interest.
* These companies may be deemed affiliated persons of the Partnership
as defined in the Investment Company Act of 1940.
See notes to financial statements.
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
Three Months Ended Nine Months Ended
September 30, September 30,
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT INCOME AND EXPENSES
Income:
Interest from short-term investments $ 9,295 $ 20,886 $ 29,339 $ 79,231
Interest and other income from portfolio
investments 63,329 31,495 128,408 97,535
------ ------ ------- ------
Totals 72,624 52,381 157,747 176,766
------ ------ ------- -------
Expenses:
Management fee - Note 4 50,000 50,000 150,000 157,552
Professional fees 4,455 15,204 45,455 60,596
Independent General Partners' fees - Note 6 15,359 14,013 39,826 34,926
Mailing and printing 4,187 5,155 15,819 17,933
Amortization of deferred organizational costs
- Note 2 1,192 2,386 5,964 7,158
Custodial fees 1,725 1,816 4,625 4,467
Miscellaneous 10 - 1,180 918
-- - ----- ---
Totals 76,928 88,574 262,869 283,550
------ ------ ------- -------
NET INVESTMENT LOSS (4,304) (36,193) (105,122) (106,784)
Net realized loss from investments sold or
written-off - (692,899) (225,511) (692,899)
- -------- -------- --------
NET REALIZED LOSS FROM OPERATIONS
(allocable to Partners) - Note 3 (4,304) (729,092) (330,633) (799,683)
Net change in unrealized appreciation of
investments 117,995 83,333 4,197,205 (543,209)
------- ------ --------- --------
NET INCREASE (DECREASE) IN
NET ASSETS RESULTING FROM
OPERATIONS $ 113,691 $ (645,759) $ 3,866,572 $ (1,342,892)
= ======= = ======== = ========= = ==========
</TABLE>
See notes to financial statements.
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30,
<TABLE>
1994 1993
---- ----
<S> <C> <C>
CASH FLOWS USED FOR OPERATING ACTIVITIES
Net investment loss $ (105,122) $ (106,784)
Adjustments to reconcile net investment loss to cash used for
operating activities:
Amortization of deferred organizational costs 5,964 7,158
Increase (decrease) in payables (23,975) 6,442
(Increase) decrease in accrued interest on short-term investments (670) 3,293
Increase in accrued interest and other receivables (913) (14,620)
---- --------
Cash used for operating activities (124,716) (104,511)
-------- --------
CASH FLOWS PROVIDED FROM (USED FOR) INVESTING
ACTIVITIES
Purchase of portfolio investments (921,278) (1,816,497)
Proceeds from the sale of portfolio investments 22,664 -
Deposits released from escrow - 70,295
Net return (purchase) of short-term investments 249,495 1,983,516
Repayment of investment in notes 280,000 5,000
------- -----
Cash provided from (used for) investing activities (369,119) 242,314
-------- -------
Increase (decrease) in cash and cash equivalents (493,835) 137,803
Cash and cash equivalents at beginning of period 880,833 524,431
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 386,998 $ 662,234
= ======= = =======
</TABLE>
See notes to financial statements.
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1994
<TABLE>
Unallocated
Managing Individual Net Unrealized
General General Limited Appreciation of
Partner Partners Partners Investments Total
<S> <C> <C> <C> <C> <C>
Balance at beginning
of period $ 78,613 $ 3,038 $ 7,779,633 $ 499,648 $ 8,360,932
Allocation of net
investment loss - Note 3 (1,051) (41) (104,030) - (105,122)
Allocation of net realized
loss on investments - Note 3 (2,255) (87) (223,169) - (225,511)
Net change in unrealized
appreciation of investments - - - 4,197,205 4,197,205
- - - --------- ---------
Balance at end of period $ 75,307 $ 2,910 $ 7,452,434(A) $ 4,696,853 $ 12,227,504
= ====== = ===== = ========= = ========= = ==========
</TABLE>
(A) The net asset value per unit of limited partnership interest, including
an assumed allocation of net unrealized appreciation of investments, was
$1,181.
See notes to financial statements.
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. Organization and Purpose
ML Oklahoma Venture Partners, Limited
Partnership (the "Partnership") was formed on July 15, 1988 under the Revised
Uniform Limited Partnership Act of the State of Oklahoma. The Partnership's
operations commenced on August 14, 1989. MLOK Co., Limited Partnership, the
managing general partner of the Partnership (the "Managing General Partner"), is
an Oklahoma limited partnership formed on July 15, 1988, the general partner of
which is Merrill Lynch Venture Capital Inc. (the "Management Company"), an
indirect subsidiary of Merrill Lynch & Co., Inc.
The Partnership's objective is to achieve long-term capital appreciation by
making venture capital investments in new or developing companies, primarily
Oklahoma companies, and other special investment situations. The Partnership
shall not engage in any other business or activity. The Partnership will
terminate on December 31, 1998, subject to the right of the Individual General
Partners to extend the term for up to two additional two-year
periods.
2. Significant Accounting Policies
Valuation of Investments - Short-term investments are carried at amortized cost
which approximates market. Portfolio investments are carried at fair value as
determined quarterly by the Managing General Partner under the supervision of
the Individual General Partners. The Managing General Partner determines the
fair value of its portfolio investments by applying consistent guidelines. The
fair value of public securities is adjusted to the average closing public market
price for the last five trading days of the quarter less an appropriate discount
for sales restrictions, the size of the Partnership's holdings and the public
market trading volume. Private securities are carried at cost until significant
developments affecting a portfolio investment provide a basis for change in
valuation. The fair value of private securities is adjusted 1) to reflect
meaningful third-party transactions in the private market or 2) to reflect
significant progress or slippage in the development of the company's business
such that cost is clearly no longer reflective of fair value. As a venture
capital investment fund, the Partnership's portfolio investments involve a high
degree of business and financial risk that can result in substantial losses. The
Managing General Partner considers such risks in determining the fair value of
the Partnership's portfolio investments. Investment Transactions - Investment
transactions are recorded on the accrual method. Portfolio investments are
recorded on the trade date, the date the Partnership obtains an enforceable
right to demand the securities or payment therefor. Realized gains and losses on
investments sold are computed on a specific identification basis.Income Taxes -
No provision for income taxes has been made since all income and losses are
allocable to the Partners for inclusion in their respective tax returns.
Statements of Cash Flows - The Partnership considers its interest-bearing cash
account to be cash equivalents. Organizational Costs - Organizational costs of
$47,718 were amortized over a sixty-month period which commenced August 14,
1989.
<PAGE>
ML OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
3. Allocation of Partnership Profits and Losses
Pursuant to the Partnership Agreement, profits from venture
capital investments are allocated to all Partners in proportion to their capital
contributions until all Partners have been allocated a 10% Priority Return from
liquidated investments. Profits in excess of this amount are allocated 30% to
the Managing General Partner and 70% to all Partners in proportion to their
capital contributions until the Managing General Partner has been allocated 20%
of the total profits from venture capital investments. Thereafter, profits from
venture capital investments are allocated 20% to the Managing General Partner
and 80% to all Partners in proportion to their capital contributions. Profits
from other sources are allocated to all Partners in proportion to their capital
contributions.
Losses are allocated to all Partners in proportion to their capital
contributions. However, if profits had been previously allocated in the 70-30 or
80-20 ratios as discussed above, then losses will be allocated in the reverse
order in which profits were allocated.
4. Related Party Transactions
The Management Company performs, or arranges for others to perform, the
management and administrative services necessary for the operation of the
Partnership. The Management Company receives a management fee at an annual rate
of 2.5% of the gross capital contributions to the Partnership, reduced by
selling commissions and organizational and offering expenses paid by the
Partnership, capital distributed and realized losses, with a minimum annual fee
of $200,000. Such fee is determined and paid quarterly.
5. Limitation on Operating Expenses
The Management Company has undertaken to the Partnership that it will reduce its
management fee or otherwise reimburse the Partnership in order to limit the
annual operating expenses of the Partnership, exclusive of the management fee,
to an amount equal to $203,720.
6. Independent General Partners' Fees
As compensation for services rendered to the Partnership, each of the three
Independent General Partners receives $16,000 annually in quarterly
installments, $1,000 for each meeting of the General Partners attended, $1,000
for each committee meeting attended ($500 if a committee meeting is held on the
same day as a meeting of the General Partners) and $500 for meetings held by
telephone conference.
7. Interim Financial Statements
In the opinion of MLOK Co., Limited Partnership, the managing general partner of
the Partnership, the unaudited financial statements as of September 30, 1994,
and for the three and nine month periods then ended, reflect all adjustments
necessary for the fair presentation of the results of the interim
periods.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Liquidity and Capital Resources
During the quarter ended September 30, 1994, the Partnership invested
$313,000 in four existing portfolio companies. From August 14, 1989
(commencement of operations) to September 30, 1994, the Partnership had invested
$8.7 million in 17 portfolio companies. At September 30, 1994, approximately
$500,000 of the original net proceeds of $9.2 million remained available for
investment.
At September 30, 1994, the Partnership held $1.1 million in cash and short-term
investments; $749,000 in short-term investments with maturities of less than one
year and $387,000 in an interest-bearing cash account. Interest earned on such
investments for the three and nine months ended September 30, 1994 was $9,000
and $29,000, respectively. Interest earned from short-term investments in future
periods is subject to fluctuations in short-term interest rates and changes in
amounts available for investment in such securities.
Funds needed to cover the Partnership's future investments and operating
expenses will be obtained from existing cash reserves, interest and other
investment income and proceeds from the sale of portfolio investments.
Results of Operations
For the three and nine months ended September 30, 1994, the Partnership had a
net realized loss from operations of $4,000 and $331,000, respectively. For the
three and nine months ended September 30, 1993, the Partnership had a net
realized loss from operations of $729,000 and $800,000, respectively. Net
realized gain or loss from operations is comprised of 1) net realized gains or
losses from portfolio investments sold or written-off and 2) net investment
income or loss.
Realized Gains and Losses from Portfolio Investments - There were no realized
gains or losses from portfolio investments sold or written-off for the three
months ended September 30, 1994. For the nine months ended September 30 , 1994,
the Partnership had a $226,000 net realized loss from portfolio investments sold
or written-off. In June 1994, the Partnership sold its investment in Sports
Tactics International, Inc. in a private transaction for $17,000, realizing a
loss of $83,000. Also, during June 1994, the Partnership sold 10,000 common
stock warrants of Envirogen, Inc. in the public market for $6,000, realizing a
gain of $6,000. Additionally, the Partnership's warrants to purchase common
stock of C.R. Anthony Company expired in June 1994 resulting in a realized loss
of $2,000. During the three months ended March 31, 1994, the Partnership
realized a $146,000 loss from the write off of its remaining investment in Symex
Corp.
For the three and nine months ended September 30, 1993, the Partnership realized
a loss of $693,000 resulting from the write off of its remaining equity
investment in Symex Corp. due to operating difficulties and a financial
restructuring of the company.
Investment Income and Expenses - For the three months ended September 30, 1994
and 1993, the Partnership had a net investment loss of $4,000 and $36,000,
respectively. The decrease in net investment loss for the 1994 period compared
to the 1993 period primarily was a result of an increase in interest and other
income earned from portfolio investments for the 1994 period partially offset by
a decrease in interest earned from the Partnership's short-term investments for
the 1994 period. For the three months ended September 30, 1994 and 1993, the
Partnership earned $63,000 and $31,000 of interest and other income from its
portfolio investments, respectively. The increase for the 1994 period compared
to the 1993 period is a result of $36,000 of preferred stock dividends received
from Diagnetics, Inc. during the 1994 period. Interest earned on short-term
investments for the three months ended September 30, 1994 and 1993, was $9,000
and $21,000, respectively. This decrease can be attributed to a decrease in
funds invested in short-term securities during the 1994 period. Investments in
short-term securities in future periods will decline as funds are used for
operating expenses and follow-on investments in existing portfolio companies. At
September 30, 1994 and 1993, the Partnership had $1.1 million and $2.7 million,
respectively, invested in short-term securities.
For the nine months ended September 30, 1994 and 1993, the Partnership had a net
investment loss of $105,000 and $107,000, respectively. There was no significant
change in net investment loss for the comparable periods. Investment income
declined to $158,000 for the 1994 period from $177,000 for the 1993 period,
primarily due to a $50,000 decrease in interest from short-term investments for
the 1994 period, as discussed above. This decrease was partially offset by a
$31,000 increase in interest and other income from portfolio investments,
primarily relating to the Diagnetics dividend received in 1994, as discussed
above. Operating expenses decreased $21,000 from $284,000 for the 1993 period to
$263,000 for the 1994 period, primarily due to reduced professional fees for the
1994 period.
The Management Company performs, or arranges for others to perform, the
management and administrative services necessary for the operation of the
Partnership. The Management Company receives a management fee of 2.5% of the
gross capital contributions to the Partnership, reduced by selling commissions
and organizational and offering expenses paid by the Partnership, capital
distributed and realized losses, with a minimum fee of $200,000 annually. Such
fee is determined and paid quarterly. The management fee for the three months
ended September 30, 1994 and 1993 was $50,000 for both periods. The management
fee for the nine months ended September 30, 1994 and 1993 was $150,000 and
$158,000, respectively. To the extent possible, the management fee and other
expenses incurred directly by the Partnership are paid with funds provided from
operations.
Unrealized Gains and Losses and Changes in Unrealized Appreciation or
Depreciation of Portfolio Investments - For the nine months ended September 30,
1994, the Partnership had a $4 million net unrealized gain, primarily resulting
from the upward revaluation of its investment in Silverado Foods, Inc. as a
result of the company's initial public offering completed during the quarter.
Additionally, during the nine month period, a net $242,000 was transferred from
unrealized loss to realized loss primarily relating to the sale and write off of
Sports Tactics and Symex, as discussed above. The $4 million unrealized gain and
the $242,000 net transfer from unrealized loss to realized loss resulted in a
$4.2 million increase in net unrealized appreciation of investments for the nine
month period.
For the nine months ended September 30, 1993, the Partnership had an $896,000
unrealized loss, primarily resulting from the downward revaluation of certain
portfolio investments. Additionally, during the nine month period, the
Partnership transferred $353,000 from unrealized loss to realized loss relating
to the write off of Symex, as discussed above. The $896,000 unrealized loss
offset by the $353,000 transfer from unrealized loss to realized loss resulted
in a $543,000 decrease in net unrealized appreciation of investments for the
nine month period.
Net Assets - Changes to net assets resulting from operations is comprised of 1)
net realized gains and losses from operations and 2) changes to net unrealized
appreciation or depreciation of portfolio investments. For the nine months ended
September 30, 1994, the Partnership had a net increase in net assets resulting
from operations of $3.9 million. For the nine months ended September 30, 1993,
the Partnership had a net decrease in net assets resulting from operations of
$1.3 million.
At September 30, 1994, the Partnership's net assets were $12.2 million, an
increase of $3.9 million from $8.4 million at December 31, 1993. This increase
resulted from the $4.2 million increase in net unrealized appreciation of
investments partially offset by the $331,000 net realized loss from operations
for the nine month period.
At September 30, 1993, the Partnership's net assets were $8.6 million, a
decrease of $1.3 million from $10 million at December 31, 1992. This decrease
resulted from the $800,000 net realized loss from operations and the $543,000
decrease in net unrealized appreciation of investments for the nine month
period.
Gains or losses from investments are allocated to the Partners' capital accounts
when realized in accordance with the Partnership Agreement (see Note 3 of Notes
to Financial Statements). However, for purposes of calculating the net asset
value per unit of limited partnership interest, net unrealized appreciation or
depreciation of investments has been included as if the net appreciation or
depreciation had been realized and allocated to the Limited Partners in
accordance with the Partnership Agreement. Pursuant to such calculation, the net
asset value per $1,000 Unit at September 30, 1994 and December 31, 1993 was
$1,181 and $807, respectively.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Partnership is not a party to any material pending legal proceedings.
Item 2. Changes in Securities.
Not applicable.
Item 3. Defaults Upon Senior Securities.
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of security holders during the quarter covered
by this report.
<PAGE>
Item 5. Other Information.
On July 1, 1994, the Partnership purchased a $50,000 convertible promissory note
from Diagnetics, Inc. On July 22, 1994, the Partnership converted its promissory
notes aggregating $250,000 in face value and accrued interest of $12,812 into
189,073 preferred shares of Diagnetics. In addition, the Partnership exchanged
its warrants and accrued dividends of $35,770 into 25,734 preferred shares of
the company.
On September 1, 1994, the Partnership purchased a 10% promissory note of
Independent Gas Company Holdings, Inc. for $14,100. This investment is in
addition to the 400 shares of preferred stock and 3,336 shares of common stock
previously owned by the Partnership.
On September 30, 1994, the Partnership purchased a 10% demand note from Americo
Publishing, Inc. for $25,000. This investment is in addition to the $200,000
demand note previously owned by the Partnership.
During the quarter, the Partnership purchased promissory notes of Data Critical
Corp. for $175,000. Additionally, in connection with a debt restructuring, the
Partnership exchanged its 8% and 10% notes aggregating $350,000 in face value
and its warrant to purchase 17,500 shares of common stock at $5 per share for a
$350,000 8% promissory note and a warrant to purchase 87,500 shares of common
stock at $4 per share.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
(3) (a) Amended and Restated Certificate of Limited Partnership of the
Partnership dated as of November 29, 1988.*
(b) Amended and Restated Agreement of Limited Partnership of the Partnership
dated as of November 29, 1988.*
(c) Amended and Restated Agreement of Limited Partnership of the Partnership
dated as of August 14, 1989.**
(10) Management Agreement dated as of November 29, 1988 between the Partnership
and the Management Company.*
(28) (a) Prospectus of the Partnership dated December 1, 1988 filed with the
Securities and Exchange Commission pursuant to Rule 497 (b) under the Securities
Act of 1933, as supplemented by a supplement dated April 25, 1989 filed pursuant
to Rule 497 (d) under the Securities Act of 1933.***
(b) No reports on Form 8-K have been filed during the quarter for which this
report is filed.
<PAGE>
- ------------------------------
* Incorporated by reference to the Partnership's Annual Report on Form
10-K for the fiscal year ended December 31, 1988 filed with the
Securities and Exchange Commission on April 3, 1989.
** Incorporated by reference to the Partnership's Quarterly Report on Form
10-Q for the quarter ended September 30, 1989 filed with the Securities
and Exchange Commission on November 14, 1989.
*** Incorporated by reference to the Partnership's Quarterly Report on Form
10-Q for the quarter ended June 30, 1989 filed with the Securities and
Exchange Commission on May 15, 1989.
<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 OKLAHOMA VENTURE PARTNERS, LIMITED PARTNERSHIP
By: MLOK Co., Limited Partnership
its Managing General Partner
By: Merrill Lynch Venture Capital Inc.
its General Partner
By: /s/ Kevin K. Albert
Kevin K. Albert
President
(Principal Executive Officer)
By: /s/ Joseph W. Sullivan
Joseph W. Sullivan
Treasurer
(Principal Financial and Accounting Officer)
Date: November 11, 1994
<PAGE>
Exhibit Index
Exhibits Page
(3) (a) Amended and Restated Certificate of Limited Partnership of the
Partnership dated as of November 29, 1988.*
(3) (b) Amended and Restated Agreement of Limited Partnership of the Partnership
dated as of November 29, 1988.*
(3) (c) Amended and Restated Agreement of Limited Partnership of the Partnership
dated as of August 14, 1989.**
(10) Management Agreement dated as of November 29, 1988 between the Partnership
and the Management Company.*
(28) (a) Prospectus of the Partnership dated December 1, 1988 filed with the
Securities and Exchange Commission pursuant to Rule 497(b) under the Securities
Act of 1933, as supplemented by a supplement dated April 25, 1989 filed pursuant
to Rule 497(d) under the Securities Act of 1933.***
- ------------------------------
* Incorporated by reference to the Partnership's Annual Report on Form
10-K for the fiscal year ended December 31, 1988 filed with the
Securities and Exchange Commission on April 3, 1989.
** Incorporated by reference to the Partnership's Quarterly Report on Form
10-Q for the quarter ended September 30, 1989 filed with the Securities
and Exchange Commission on November 14, 1989.
*** Incorporated by reference to the Partnership's Quarterly Report on Form
10-Q for the quarter ended June 30, 1989 filed with the Securities and
Exchange Commission on May 15, 1989.
