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FORM 10-Q.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
(As last amended in Rel. No. 31326, eff. 10/22/92.)
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 June 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 SIX MONTHS ENDED JUNE 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
June 30, December 31,
1999 1998
<S> <C> <C>
CASH $ 80 $ 114,342
RESTRICTED CASH 140,769 140,769
LAND AND LAND IMPROVEMENTS
HELD FOR INVESTMENT 5,599,928 5,599,928
Total Assets $ 5,740,777 $ 5,855,039
=========== ==========
LIABILITIES AND PARTNERS' DEFICIT
NOTE PAYABLE TO AFFILIATE $ 4,700,000 $ 4,700,000
ACCRUED INTEREST PAYABLE TO
AFFILIATE 3,356,834 3,072,634
ACCOUNTS PAYABLE &
ACCRUED EXPENSES 87,002 133,500
TOTAL LIABILITIES 8,143,836 7,906,134
PARTNERS' DEFICIT:
Limited Partners (1,875
Units Outstanding) (2,403,059) (2,051,095)
General Partner - -
Total Partners' Deficit (2,403,059) (2,051,095)
Total Liabilities &
Partners' Deficit $ 5,740,777 $ 5,855,039
========== ==========
<FN>
See accompanying 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 SIX MONTHS ENDED
June 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
REVENUES:
Interest $ - $ - $ - $ 3,331
------ ------ ------ ------
Total Revenues - - - 3,331
EXPENSES:
Property Taxes 28,681 11,190 57,362 22,380
Interest 141,000 141,000 282,000 282,000
Property Management Fees 750 750 1,500 1,500
Legal and Accounting Fees 7,975 3,734 10,375 11,384
Architect and Engineering
Fees - 1,981 - 9,907
Other Administrative
Expenses 627 1,468 727 1,740
Total Expenses 179,033 160,123 351,964 328,911
Net Loss $(179,033)$(160,123)$(351,964) $(325,580)
Net Loss per limited
partner unit $ (95.48) $(85.40) $(187.71) $(173.64)
<FN>
See accompanying notes to financial statements.
</TABLE>
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<TABLE>
RAINES ROAD, L.P.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Six Months Ended
June 30,
1999 1998
<S> <C> <C>
Cash flows from operating activities:
Net Loss $ (351,964) $ (325,580)
Adjustments to reconcile net
loss to net cash used
in operating activities:
Increase in accrued interest payable 284,200 275,500
Decrease in accounts payable &
Accrued Expenses (46,498) (22,378)
Net Cash used in
operating activities (114,262) (72,458)
NET (DECREASE) INCREASE IN CASH (114,262) (72,458)
CASH AT JANUARY 1, 114,342 98,678
CASH AT JUNE 30, $ 80 $ 26,220
Supplelmental Disclosures of Cash Flow information:
Cash paid during the year for interst $ 4,400 $ -
<FN>
See accompanying notes to financial statements.
</TABLE>
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RAINES ROAD, L.P.
(A Limited Partnership)
NOTES TO THE FINANCIAL STATEMENTS
For the Three and Six Months Ended June 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 six month period ended June 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 first six months were as follows:
1999 1998
Property Management Fees 1,500 1,500
Accounting Fees 1,800 1,300
C. COMPREHENSIVE INCOME
During the three and six month periods ended June 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 six months of 1999
or 1998.
Overall operations of the Registrant are comparable to prior
quarters with the following exception. The increase in architect
and engineering fees in 1998 is due to engineering work done on the
property.
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.
The Plan anticipates that by mid-1999 the conversion,
implementation and testing phases will be completed. Management
believes that the total remediation costs for the Plan will not be
material to the operations or liquidity of the Partnership.
The Partnership is in the process of identifying and
contacting critical suppliers and other vendors whose computerized
systems interface with the Partnership's systems, regarding their
plans and progress in addressing their Year 2000 issues. The
Partnership has received varying information from such third
parties on the state of compliance or expected compliance.
Contingency plans are being developed in the event that any
critical supplier or customer 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 June 30, 1999, the Registrant had $ 80 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: August 13, 1999 By: /s/ Steven D. Ezell
General Partner
By: 222 PARTNERS, INC.
General Partners
Date: August 13, 1999 By: /s/ Michael A. Hartley
Secretary/Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 80
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 5,599,928
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,740,777
<CURRENT-LIABILITIES> 87,002
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,403,059
<TOTAL-LIABILITY-AND-EQUITY> 5,740,777
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 69,964
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 282,000
<INCOME-PRETAX> (351,964)
<INCOME-TAX> 0
<INCOME-CONTINUING> (351,964)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (351,964)
<EPS-BASIC> (187.71)
<EPS-DILUTED> (187.71)
</TABLE>
