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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 SEPTEMBER 30, 1999
Commission file number 0-18042
COMMUNITY INVESTMENT PARTNERS, L.P.
- -----------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MISSOURI 43-1531582
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
12555 Manchester Road
St. Louis, Missouri 63131
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 515-2000
-------------------
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
--- ---
1
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COMMUNITY INVESTMENT PARTNERS, L.P.
INDEX
Page
Number
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Schedule of Portfolio Investments 3
Statement of Financial Condition 4
Statement of Income 5
Statement of Cash Flows 6
Statement of Changes in Partnership Capital 7
Notes to Financial Statements 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Part II. OTHER INFORMATION<F*>
Item 1. Legal Proceedings 11
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 13
[FN]
<F*>Items 2,3,4 and 5 are omitted as they are not applicable
2
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
AS OF SEPTEMBER 30, 1999
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<CAPTION>
Company Nature of Business
Initial Investment Date Investment Cost Fair Value
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<S> <C> <C> <C>
Saztec International, Inc. Provides services for database
(SAZZ) construction and information
conversion
June 7, 1990 27,100 shares of Common Stock $ 78,324 $ 14,397
Intermedia Organized to install and provide
Communications of private, dedicated telecommunication
Florida (ICIX) lines using fiber optic cable
May 31, 1991 13,070 shares of Common Stock 18,397 284,272
Citation Computers Provides clinical
(CITA) laboratory information
October 31, 1991 8,680 shares of Common Stock 21,305 17,360
Isolyser Company, Inc. Makes healthcare disposables from
(OREX) hot-water soluble polymer
August 30, 1996 65,063 shares of Common Stock 248,818 239,920
-------- --------
$366,844 $555,949
======== ========
</TABLE>
3
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENT OF FINANCIAL CONDITION
<CAPTION>
Unaudited
September 30, December 31,
1999 1998
- -----------------------------------------------------------------------------------------
ASSETS
------
<S> <C> <C>
Investments at Fair Value
(cost $366,844 and $392,502, respectively) $555,949 $327,320
Cash and Cash Equivalents 272,052 212,383
Accounts Receivable 22,718 --
-------- --------
TOTAL ASSETS $850,719 $539,703
======== ========
<CAPTION>
LIABILITIES AND PARTNERSHIP CAPITAL
-----------------------------------
<S> <C> <C>
Liabilities:
Accounts Payable and Accrued Expenses $ 10,500 $ 14,000
-------- --------
TOTAL LIABILITIES 10,500 14,000
-------- --------
Partnership Capital:
Capital - Limited Partners 692,226 436,053
Capital - General Partners 147,993 89,650
-------- --------
TOTAL PARTNERSHIP CAPITAL 840,219 525,703
-------- --------
TOTAL LIABILITIES AND
PARTNERSHIP CAPITAL $850,719 $539,703
======== ========
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The accompanying notes are an integral part of these financial statements.
</TABLE>
4
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENT OF INCOME
(UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1999 1998 1999 1998
============================================================================================================
INCOME
------
<S> <C> <C> <C> <C>
Dividend and Interest Income $ -- $ 1,122 $ -- $ 8,723
--------- -------- -------- ----------
TOTAL INCOME -- 1,122 -- 8,723
--------- -------- -------- ----------
<CAPTION>
EXPENSES
--------
<S> <C> <C> <C> <C>
Professional Fees 13,072 4,813 26,338 20,706
Directors Fees -- -- -- 2,000
Other 515 515 515 1,266
--------- -------- -------- ----------
TOTAL EXPENSES 13,587 5,328 26,583 23,972
--------- -------- -------- ----------
Net (Loss) before Net Realized Gains and
Net Unrealized (Losses) Gains (13,587) (4,206) (26,853) (15,249)
Net Realized Gains on
Sale of Investments 84,596 672,380 87,083 1,199,587
Net Unrealized (Losses) Gains on
Investments (171,250) 70,733 254,286 (607,290)
--------- -------- -------- ----------
NET (LOSS) INCOME $(100,241) $738,907 $314,516 $ 577,048
========= ======== ======== ==========
Per Unit Information:
Net Income (Loss) $ (.93) $ 6.85 $ 2.91 $ 5.35
========= ======== ======== ==========
Net Asset Value (as of Sept. 30, 1999
and December 31, 1998) $ 7.79 $ 4.88
======== ==========
Units Outstanding:
Limited Partners 87,820 87,820
General Partners 20,000 20,000
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The accompanying notes are an integral part of these financial statements.
</TABLE>
5
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENT OF CASH FLOWS
(UNAUDITED)
<CAPTION>
Nine Months Ended
Sept. 30, 1999 Sept. 30, 1998
==============================================================================================================
<S> <C> <C>
CASH FLOWS PROVIDED BY OPERATING
ACTIVITIES:
Net Income $ 314,516 $ 577,048
Adjustments to reconcile Net Income to Net
Cash Provided by Operating Activities -
Sale of Portfolio Investments 22,718 2,063,786
Net Realized Gain (Loss) on Sale of Portfolio Investments 2,939 (1,199,587)
Unrealized (Gain) Loss on Investments (254,286) 607,290
Decrease in Accrued Interest
Receivable -- 59,784
Increase in Accounts Receivable (22,718) --
Decrease in Accounts Payable
and Accrued Expenses (3,500) (3,250)
--------- -----------
Total Cash Provided by
Operating Activities 59,669 2,105,071
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CASH FLOWS USED BY FINANCING ACTIVITIES:
Capital Distribution -- (2,102,490)
--------- -----------
Total Cash Used by Financing Activities -- (2,102,490)
--------- -----------
Net Increase in Cash and Cash Equivalents 59,669 2,581
CASH AND EQUIVALENTS, Beginning of period 212,383 146,085
--------- -----------
CASH AND EQUIVALENTS, End of period $ 272,052 $ 148,666
========= ===========
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The accompanying notes are an integral part of these financial statements.
</TABLE>
6
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENT OF CHANGES IN PARTNERSHIP CAPITAL
(UNAUDITED)
<CAPTION>
Nine Months Ended September 30, 1999 and 1998
Limmited Partners General Partners Total
===================================================================================================
<S> <C> <C> <C>
Balance, December 31, 1997 $ 1,754,109 $ 389,828 $ 2,143,937
Net Income 470,006 107,042 577,048
Distribution (1,712,490) (390,000) (2,102,490)
----------- --------- -----------
Balance, September 30, 1998 $ 511,625 $ 106,870 $ 618,495
=========== ========= ===========
Balance, December 31, 1998 $ 436,053 $ 89,650 $ 525,703
Net Income 256,173 58,343 314,516
----------- --------- -----------
Balance, September 30, 1999 $ 692,226 $ 147,993 $ 840,219
=========== ========= ===========
===================================================================================================
The accompanying notes are an integral part of these financial statements.
</TABLE>
7
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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
COMMUNITY INVESTMENT PARTNERS, L.P.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
BASIS OF PRESENTATION
Community Investment Partners, L.P. (CIP) is a limited partnership
which has elected to be a business development company under the
Investment Company Act of 1940, as amended. As a business development
company, the partnership is required to invest at least 70% of its total
assets in qualifying investments as specified in the Investment Company
Act. CIP Management, L.P., LLLP (Management), a limited liability
limited partnership, is the Managing General Partner of CIP. Management
is responsible for making all decisions regarding CIP's investment
portfolio. CIP is no longer making initial investments.
All portfolio investments are carried at cost until significant
developments affecting an investment provide a basis for revaluation.
Thereafter, portfolio investments are carried at fair value as obtained
from outside sources or at a value determined quarterly by the Managing
General Partner under the supervision of the Independent General
Partners. Due to the inherent uncertainty of valuation, those estimated
values for portfolio investments carried at cost may differ
significantly from the values that would have been used had a ready
market for the investment existed, and the differences could be material
to the financial statements. Investments in securities traded on a
national securities exchange are valued at the latest reported sales
price on the last business day of the period. If no sale has taken
place, the securities are valued at the last bid price. If no bid price
has been reported, or if no exchange quotation is available, the
securities are valued at the quotation obtained from an outside broker.
Investment transactions are recorded on a trade date basis. Income is
recorded on an accrual basis.
8
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Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operation
COMMUNITY INVESTMENT PARTNERS, L.P.
MANAGEMENT'S FINANCIAL DISCUSSION
RESULTS OF OPERATIONS
QUARTER ENDED SEPTEMBER 30, 1999 VERSUS QUARTER ENDED SEPTEMBER 30, 1998
A net loss of $100,241 was recorded for the three months ended
September 30, 1999, compared to net income of $738,907 for the three
months ended September 30, 1998. The net loss for the three months ended
September 30, 1999 is comprised mainly of a net realized gain on
investments in the amount of $84,596 and unrealized losses on
investments in the amount of $171,250. The net realized gain represents
a $87,535 escrow payment received as a result of the 1998 liquidation of
Innovation Medical Technologies Preferred stock, and losses of $479 and
$2,460 related to sales of Citation Computers and Isloyser Company, Inc.
common stock, respectively. The unrealized loss reflects decreases in
the share prices of investments, the most notable being Intermedia
Communications of Florida and Isolyser Company, Inc., which decreased by
28% and 21%, respectively.
Expenses for the three months ended September 30, 1999 were $13,587,
an increase of $8,260 from the same period in 1998. The increase in
expenses was caused by legal fees incurred related to the planned sale
of Partnership assets and eventual dissolution.
Additional investments have not been made during the third quarter of
1999. Subsequent to September 30, 1999 the Partnership voted to
dissolve. The remaining investments will be sold, with net proceeds
distributed to unitholders.
NINE MONTHS ENDED SEPTEMBER 30, 1999 VERSUS NINE MONTHS ENDED SEPTEMBER
30, 1998
Net income for the nine months ended September 30, 1999 and 1998 was
$314,516 and $577,048, respectively. Dividend and interest income
decreased $8,723 from the nine months ended September 30, 1998 due to
the liquidation of Innovation Medical Technologies, Inc. preferred stock
in 1998. Expenses increased $2,881, due to an increase in legal expenses
partially offset by a $2,000 decrease in directors' fees. Direcctors'
fees were discontinued after the second quarter of 1998.
Realized gains on investments resulted from $90,474 of escrow
payments from the Innovation Medical Technologies Preferred Stock
liquidation and realized losses of $2,939 from the sales of Citation
Computers and Isolyser Company, Inc. common stock. Net unrealized gains
on investments were attributable to increases in the share prices of
Intermedia Communications, Inc. and Isolyser Company, Inc. common stock
over their 1998 amounts.
9
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Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operation
INVESTMENT TRANSACTIONS
Following is a summary of portfolio investment transactions during the
period ended September 30, 1999.
<TABLE>
<CAPTION>
Type of Realized
Company Transaction Cost Proceeds Gain (Loss)
- ------------------------- ----------------- ------- -------- -----------
<S> <C> <C> <C> <C>
SALES:
- ------
Quarter 3 ended:
- ----------------
Citation Computers Sale of 5,000
shares of
Common Stock $12,272 $ 9,812 $(2,460)
Isolyser Company, Inc. Sale of 3,500
shares of
Common Stock $13,385 12,906 $ (479)
------- ------- -------
Total Sales $25,657 22,718 $ 2,939
======= ======= =======
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
Total Partnership capital was $840,219 as of September 30, 1999, which
consisted of $692,226 in limited partner capital and $147,993 in general
partner capital. Net income was allocated to the limited partners in the
amount of $256,173 and to the general partners in the amount of $58,343.
At September 30, 1999, the Partnership had $272,052 in cash and cash
equivalents.
SUBSEQUENT EVENTS
Subsequent to September 30, 1999, unitholders of the Partnership voted
to liquidate the Partnership's remaining publicly held investments and
entered into an agreement to sell remaining privately-held investments to
EDJ Ventures Ltd., which owns a 98% limited partnership interest in the
Partnership's general partner, CIP Management, L.P. According to section
9.1.1 of the Partnership Agreement, the Partnership shall dissolve upon
the sale of substantially all of the Partnership's assets. As of November
15, 1999, investments with a cost basis of $242,525 were sold, resulting
in a net gain of $297,345. The Partnership has assets with a cost basis
of $124,319 remaining to be sold prior to dissolution.
YEAR 2000 ISSUE
Although the Partnership has no Year 2000 issues that would result
from its own information systems, the Partnership has investments in
publicly and privately placed securities and loans. The Partnership may
be exposed to credit risk to the extent that the related borrowers are
materially adversely impacted by the Year 2000 issue.
10
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Part II. OTHER INFORMATION
COMMUNITY INVESTMENT PARTNERS, L.P.
Item 1: Legal Proceedings
The partnership is not a party to any material pending legal
proceedings.
Item 6: Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
No reports were filed on Form 8-K for the quarter ended
September 30, 1999.
11
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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.
COMMUNITY INVESTMENT PARTNERS, L.P.
By: CIP Management, L.P., LLLP, Managing General Partner
By: CIP Management, Inc., its Managing General Partner
/s/ Daniel A. Burkhardt
-------------------- President, Treasurer and Director November 15, 1999
Daniel A. Burkhardt
/s/ Ray L. Robbins, Jr.
-------------------- Vice-President and Director November 15, 1999
Ray L. Robbins, Jr.
12
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements for Community Investment Partners, L.P. for the
quarter ended September 30, 1999 and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<INVESTMENTS-AT-COST> 366,844
<INVESTMENTS-AT-VALUE> 555,949
<RECEIVABLES> 22,718
<ASSETS-OTHER> 272,052
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 850,719
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 10,500
<TOTAL-LIABILITIES> 10,500
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 107,820
<SHARES-COMMON-PRIOR> 107,820
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 840,219
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 87,083
<APPREC-INCREASE-CURRENT> 254,286
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 26,583
<AVERAGE-NET-ASSETS> 682,961
<PER-SHARE-NAV-BEGIN> 4.88
<PER-SHARE-NII> 2.91
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.79
<EXPENSE-RATIO> 0
</TABLE>
