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FORM 10-Q.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the period ended September 30, 1999
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: 33-26327
RAINES ROAD, L.P.
(Exact name of Registrant as specified in its charter)
Delaware 62-1375245
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification)
4400 Harding Road, Suite 500, Nashville, Tennessee 37205
(Address of principal executive office) (Zip Code)
(615) 292-1040
(Registrant's telephone number, including area code)
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 at least the past 90 days.
YES X NO
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PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
RAINES ROAD, L.P.
(A Delaware Limited Partnership)
FINANCIAL STATEMENTS FOR THE
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
INDEX
Financial Statements
Balance Sheets 3
Statements of Operations 4
Statements of Cash Flows 5
Notes To Financial Statements 6
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<TABLE>
RAINES ROAD, L.P.
(A Limited Partnership)
BALANCE SHEETS
(Unaudited)
<CAPTION>
ASSETS
September 30, December 31,
1999 1998
<S> <C> <C>
CASH $ 93 $ 114,342
RESTRICTED CASH 143,642 140,769
LAND AND LAND IMPROVEMENTS
HELD FOR INVESTMENT 5,599,928 5,599,928
Total Assets $5,743,663 $5,855,039
=========== ==========
LIABILITIES AND PARTNERS' DEFICIT
NOTE PAYABLE TO AFFILIATE $4,700,000 $4,700,000
ACCRUED INTEREST PAYABLE TO
AFFILIATE 3,502,934 3,072,634
ACCOUNTS PAYABLE 128,980 133,500
Total Liabilities 8,331,914 7,906,134
PARTNERS' DEFICIT:
Limited Partners ( 1,875 units
outstanding) (2,588,251) (2,051,095)
General Partner - -
Total Partners' Deficit (2,588,251) (2,051,095)
Total Liabilities &
Partners' Deficit $5,743,663 $5,855,039
========== ==========
<FN>
See notes to financial statements.
</TABLE>
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<TABLE>
RAINES ROAD, L.P.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
REVENUES:
LAND SALES:
Gross Proceeds $ - $ - $ - $ -
Cost of Land
and Improvements Sold - - - -
Closing Costs - - - -
Gain on Land Sales - - - -
Interest - - - 3,331
------ ------ ------ --------
Total Revenues - - - 3,331
EXPENSES:
Property Taxes 41,829 57,943 99,191 80,323
Interest 141,000 141,000 423,000 423,000
Program Management Fees 750 750 2,250 2,250
Legal & Accounting 825 400 11,200 11,784
Architect & Engineering - 437 - 10,344
Other Administrative
Expenses 788 - 1,515 1,740
Total Expenses 185,192 200,530 537,156 529,441
Net Loss $ (185,192)$(200,530) $(537,156) $(526,110)
Net Loss per limited
partner unit $ (98.77) $(106.95) $(286.48) $(280.59)
<FN>
See notes to financial statements.
</TABLE>
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<TABLE>
RAINES ROAD, L.P.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Nine Months Ended
September 30,
1999 1998
<S> <C> <C>
Cash flows from operating activities:
Net Loss $(537,156) $(526,110)
Adjustments to reconcile net
loss to net cash used
by operating activities:
Interest Payable 430,300 414,200
(Decrease) Increase in
Accounts Payable (4,520) 35,565
Increase in Restricted Cash (2,873) -
------- --------
Net Cash used in
Operating Activities: (114,249) (76,345)
NET DECREASE IN CASH (114,249) (76,345)
CASH AT JANUARY 1, 114,342 98,678
CASH AT SEPTEMBER 30, $ 93 $ 22,333
======= =======
Supplemental Disclosures of
Cash Flow Information:
Cash Paid During the Year
For Interest $ 4,400 $ 8,800
====== =======
<FN>
See notes to financial statements.
</TABLE>
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RAINES ROAD, L.P.
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For the Three and Nine Months Ended September 30, 1999 and 1998
(Unaudited)
A.ACCOUNTING POLICIES
The unaudited financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q and do
not include all of the information and note disclosures required by
generally accepted accounting principles. These statements should
be read in conjunction with the financial statements and notes
thereto included in the Partnership's Form 10-K for the year ended
December 31, 1998. In the opinion of management such financial
statements include all adjustments, consisting only of normal
recurring adjustments, necessary to summarize fairly the
Partnership's financial position and results of operations. The
results of operations for the nine month period ended September 30,
1999 may not be indicative of the results that may be expected for
the year ending December 31, 1999.
B.RELATED PARTY TRANSACTIONS
The General Partner and its affiliates have been actively involved
in managing the property. Compensation earned for these services
for the nine months were as follows:
1999 1998
Program Management Fee $ 2,250 $ 2,250
Accounting Fees $ 2,200 $ 1,700
C.COMPREHENSIVE INCOME
During the three and nine month periods ended September 30, 1999
and 1998, the Partnership had no components of other comprehensive
income. Accordingly, comprehensive income for each of the periods
was the same as net loss.
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Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
There have been no sales during the first nine months of 1999 or
1998. The General Partner is reviewing and changing the marketing
efforts used to promote property sales. We anticipate these
changes to yield sales in the short term.
Overall operations of the Registrant are comparable to prior
quarters with the following exception. The architect and
engineering fees in 1998 were for engineering work done on the
property in preparation for or in anticipation of a land sale.
During the fourth quarter, Management will update its evaluation of
the values of the Property and if necessary, any impairment
reserves will be recorded.
Year 2000
In 1998, the Partnership initiated a plan ("Plan") to identify, and
remediate "Year 2000" issues within each of its significant
computer programs and certain equipment which contain
microprocessors. The Plan is addressing the issue of computer
programs and embedded computer chips being unable to distinguish
between the year 1900 and the year 2000, if a program or chip uses
only two digits rather than four to define the applicable year.
The Partnership has divided the Plan into five major
phases-assessment, planning, conversion, implementation and
testing. After completing the assessment and planning phases
earlier year, the Partnership is currently in the conversion,
implementation, and testing phases. Systems which have been
determined not to be Year 2000 compliant are being either replaced
or reprogrammed, and thereafter tested for Year 2000 compliance.
Contingency plans are being developed in the event that any
critical system is not compliant.
The failure to correct a material Year 2000 problem could result in
an interruption in, or failure of, certain normal business
activities or operations. Such failures could materially and
adversely affect the Partnership's operations, liquidity and
financial condition. Due to the general uncertainty inherent in
the Year 2000 problem, resulting in part from the uncertainty of
the Year 2000 readiness of third-party suppliers and customers, the
Partnership is unable to determine at this time whether the
consequences of Year 2000 failures will have a material impact on
the Partnership's operations, liquidity or financial condition.
Financial Condition and Liquidity
As of October 31, 1999, the Registrant had $ 34 in cash
reserves. This balance is not sufficient to meet the operating
needs of the Registrant. Unless there are property sales, the
General Partner will assist the Registrant in meeting operational
needs through affiliated loans.
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Part II. OTHER INFORMATION
Item 6.Exhibits and Reports on Form 8-K
(a) Exhibit 27 - Financial Data Schedule
(b) No 8-K's have been filed during this quarter.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
RAINES ROAD, L.P.
By: 222 RAINES LTD.
General Partner
Date: November 11, 1999 By: /s/ Steven D. Ezell
General Partner
By: 222 PARTNERS, INC.
General Partners
Date: November 11, 1999 By: /s/ Michael A. Hartley
Secretary/Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 93
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 5,599,928
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,743,663
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> (2,489,060)
<TOTAL-LIABILITY-AND-EQUITY> 5,743,663
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 114,156
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 423,000
<INCOME-PRETAX> (537,156)
<INCOME-TAX> 0
<INCOME-CONTINUING> (537,156)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (537,156)
<EPS-BASIC> (280.59)
<EPS-DILUTED> (280.59)
</TABLE>
