<PAGE>
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
-----------------
Commission file number 0-18042
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COMMUNITY INVESTMENT PARTNERS, L.P.
____________________________________________________________________
(Exact name of registrant as specified in its charter)
MISSOURI 43-1531582
____________________________________________________________________
State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
12555 Manchester Road
St. Louis, Missouri 63131
____________________________________________________________________
(Address and principal executive office) Zip Code)
Registrant's telephone number, including area code (314) 515-2000
_________________
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act: None.
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 [ ]
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of Registrant's knowledge in definitive proxy or
information statements incorporated by reference in part III of this
Form 10-K or any amendment to this form 10-K. YES [ ] NO [ X ]
As of March 15, 1999, 71,715 units of limited partnership interest
(Units), representing net assets of $349,664 were held by non-
affiliates. There is no established public market for such Units.
<PAGE>
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Prospectus of the Registrant dated March 12, 1990,
filed with the Securities and Exchange Commission and portions of the
Proxy Statement of the Registrant dated March 12, 1991, and filed with
the Securities and Exchange Commission are incorporated by reference in
Part I, Part II and Part III hereof.
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<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
TABLE OF CONTENTS
<CAPTION>
Page
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<S> <C>
PART I
Item 1. Business 4
Item 2. Properties 5
Item 3. Legal Proceedings 5
Item 4. Submission of Matters to a Vote of Security Holders 5
PART II
Item 5. Market for the Registrant's Common Equity and Related
Stockholder Matters 6
Item 6. Selected Financial Data 7
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Item 8. Index to Financial Statements and Supplementary Data 10
Item 9. Change in and Disagreements with Accountants
on Accounting and Financial Disclosure 24
PART III
Item 10. Directors and Executive Officers of the Registrant 25
Item 11. Executive Compensation 26
Item 12. Security Ownership of Certain Beneficial Owners and
Management 26
Item 13. Certain Relationships and Related Transactions 27
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K 28
SIGNATURES 29
INDEX TO EXHIBITS 30
</TABLE>
<PAGE>
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PART I
Item 1. BUSINESS
Community Investment Partners, L.P. (the "Partnership") was formed
to seek long-term capital appreciation by making investments in
companies and other special investment situations. The Partnership will
not engage in any other business or activity. The Partnership will
dissolve on December 31, 2005, subject to the right of the Individual
General Partners to extend the term for up to two additional two-year
periods.
The Partnership 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 assets in qualifying investments as specified in the Investment
Company Act.
The Partnership was formed on October 10, 1989, under the Revised
Uniform Limited Partnership Act of Missouri. CIP Management, L.P., LLLP,
the Managing General Partner, is a Missouri limited liability limited
partnership formed on October 10, 1989 as a limited partnership and
registered as a limited liability limited partnership on July 23, 1997.
The general partner of CIP Management, L.P., LLLP is CIP Management,
Inc., an indirect subsidiary of Edward D. Jones & Co., L.P.
The Partnership participated in a public offering of its limited
partnership interests in 1990. The Partnership sold 91,820 Units of
limited partnership interest for an aggregate price of $2,295,500.
After offering expenses of approximately $122,000, the Partnership
received approximately $2,173,500 in proceeds available for investment.
The Partnership is no longer making initial portfolio investments,
but may continue to make follow-on investments. For information
regarding the Partnership's current portfolio investments and purchases
and sales during the year, see Item 8 of this Form 10-K.
The information set forth under the captions "Investment
Objectives & Policies" and "Regulation" in the Prospectus of the
Partnership dated March 12, 1990, filed with the Securities and Exchange
Commission pursuant to Rule 497(b) under the Securities Act of 1933, is
incorporated herein by reference.
RISKS OF UNIT OWNERSHIP
The purchase and ownership of Units involve a number of
significant risks and other important factors. The portfolio company
investments of the Partnership involve a high degree of business and
financial risk that can result in substantial losses. Among these are
the risks associated with investments in companies with little operating
history, companies operating at a loss or with substantial variations in
operating results from period to period, companies with the need for
substantial additional capital to support expansion or achieve or
maintain a competitive position, companies which may be highly
leveraged, companies which may not be diversified and companies in which
the Partnership may be the sole or primary lender. The Partnership
invests in only a few companies. Therefore, a loss or other problem
with a single investment would have a material adverse effect on the
Partnership.
Risks may arise due to the period of time (typically four to seven
years or longer) which will elapse before portfolio company investments
have reached a state of maturity such that disposition can be
considered.
<PAGE>
<PAGE>
Portfolio companies may require additional funds and there can be
no assurance that the Partnership will have sufficient funds from
reserves or borrowing to make such follow-on investments which may have
a substantial negative impact on a portfolio company in need of
additional funds.
All decisions with respect to the management of the Partnership,
including identifying and making portfolio investments, are made
exclusively by the General Partners. Limited Partners must rely on the
abilities of the General Partners. The key personnel of the Managing
General Partner have considerable prior experience in investment banking
and in structuring investments.
Ownership of the Units also entails risk because Limited Partners
may not be able to liquidate their investment in the event of an
emergency or for any other reason due to the substantial restrictions on
transfers contained in the Partnership Agreement and the lack of a
market for the resale of Units.
The information set forth under the captions "Risk and Other
Important Factors" (including the subsections "Risks of Investment,"
"Size of Partnership," "Ability to Invest Funds," "Time Required to
Maturity of Investments; Illiquidity of Investments," "Need for Follow-
on Investments," "Use of Leverage," "Unspecified Investment," "Reliance
on Management," "New Business," "No Market for Units" and "Federal
Income Tax Considerations") on pages 9 through 14 of the Prospectus of
Partnership dated March 12, 1990, filed with the Securities and Exchange
Commission pursuant to Rule 497(b) under the Securities Act of 1933 on
March 12, 1990, is incorporated herein by this reference. (This
information has been restated herein pursuant to section 64(b) of the
Investment Company Act of 1940).
Partners should refer to the Partnership Agreement for more
detailed information.
EMPLOYEES
The Partnership has no employees. The Managing General Partner,
subject to the supervision of the Individual General Partners, manages
the Partnership's portfolio company investments and, pursuant to a
Management Agreement with the Partnership, performs or arranges for
affiliates to perform, the management and administrative services for
the Partnership and is responsible for managing the Partnership's money-
market investments. The Managing General Partner receives no fee under
the Management Agreement but is reimbursed by the Partnership for
certain expenses.
Item 2. PROPERTIES
The Partnership does not own or lease any physical properties.
Item 3. LEGAL PROCEEDINGS
The Partnership is not a party to any material pending legal
proceedings.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the
period covered by this report.
<PAGE>
<PAGE>
PART II
Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
There is no established public trading market for the Limited
Partnership interests. As of March 15, 1999, the total number of
holders of units is 104. The number of limited partnership units
outstanding is 87,820. The number of general partnership units
outstanding is 20,000 as of March 15, 1999.
Cash distributions of $7 per unit and $12.50 per unit were made to
its Partners during the year ended December 31, 1998.
The information set forth under the captions "Partnership
Distributions and Allocations" and "Transferability of Units" in the
Prospectus of the Partnership dated March 12, 1990, filed with the
Securities and Exchange Commission pursuant to Rule 497(b) under the
Securities Act of 1933 is incorporated herein by reference.
<PAGE>
<PAGE>
Item 6. SELECTED FINANCIAL DATA
<TABLE>
STATEMENTS OF FINANCIAL CONDITION:
<CAPTION>
As of
December 31,
--------------------------------------------------------------------
1998 1997 1996 1995 1994
-------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Assets $525,703 $2,143,937 $2,413,382 $3,577,659 $3,221,998
Portfolio
Investments at
Fair Value 327,320 1,951,068 2,341,691 3,217,156 3,075,566
<CAPTION>
STATEMENTS OF INCOME:
For the Years Ended
December 31,
----------------------------------------------------------------------------------
1998 1997 1996 1995 1994
---------- --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C>
Net (Loss) Income
before Realized Gains
(Losses) and Unrealized
(Losses) Gains $ (19,757) $ 37,739 $ (2,416) $(18,790) $(37,323)
Realized Gains (Losses) 1,237,319 486,662 1,647,498 594,681 (73,191)
Unrealized
(Losses) Gains (733,306) (254,746) (652,959) 318,870 97,407
Net Income (Loss) 484,256 269,655 992,123 894,761 (13,107)
Per Unit of
Partnership Interest:
Net Asset Value 4.88 19.88 22.38 33.18 29.88
Net (Loss) Income
before Realized Gains
(Losses) and Unrealized
(Losses) Gains (.18) .35 (.02) (.17) (.35)
Realized Gains (Losses) 11.48 4.51 15.28 5.52 (.68)
Unrealized
(Losses) Gains (6.80) (2.36) (6.06) 2.96 .90
Net Income (Loss) 4.49 2.50 9.20 8.30 (.12)
</TABLE>
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<PAGE>
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
(FISCAL YEAR 1998 VERSUS 1997)
Net income for the year ended December 31, 1998, was $484,256,
compared to net income of $269,655 in 1997, an increase of 80%. The
increase in net income is attributable to realized gains of $1,237,319
offset by net unrealized losses of $733,306.
Realized gains are due to significant gains recognized in 1998
from the sale of stock in Intermedia Communications of Florida and
Innovation Medical Technologies, Inc., see Note 6 to the financial
statements. Innovation Medical Technologies, Inc. shares of Class A and
B Preferred stock and Intermedia Communications of Florida shares of
Common stock were sold resulting in gains of $1,170,602 and $527,207,
respectively. The realized gains were offset by a realized loss in
Vision Partners, L.P. limited partnership interests in the amount of
$460,490. Unrealized losses are due to a decrease in share prices of
portfolio investments from the prior year and to a reversal of previous
unrealized gains on shares sold.
The partnership made distributions of $7 and $12.50 per unit
during 1998 representing amounts of $754,740 and $1,347,750,
respectively. Director's fees have been discontinued in 1998 due to the
fact that initial investments will no longer be made by the Partnership.
As of December 31, 1998, unrealized losses on investments totaled
$65,182. The future income or loss of the Partnership is contingent upon
the performance of the portfolio investments.
(FISCAL YEAR 1997 VERSUS 1996)
Net income for the year ended December 31, 1997 was $269,655,
compared to net income of $992,123 for the year ended December 31, 1996.
This decrease in net income is primarily attributable to lower realized
gains on the sale of investments in 1997. See detail of investment
sales in Note 6 to the financial statements. In 1997, there was a net
unrealized loss on investments of $254,746. This was due to a large
unrealized loss recorded for Isolyser Company, Inc. when the share price
declined significantly from the prior year, which was partially offset
by a large unrealized gain recorded for Intermedia Communications of
Florida when the company's share price more than doubled from the prior
year. These unrealized gains and losses also were offset by reversals
of prior period unrealized gains on stock sold during 1997.
In addition, income derived from dividends and interest increased
approximately $44,900 due to dividends declared for the first time that
were recorded on Innovation Medical Technologies, Inc. 6% Class A and 6%
Class B Preferred Stock. Expenses increased approximately $4,700, or
34% from the prior year due to higher trustee fees.
The Partnership made a distribution of $5 per unit during 1997.
As of December 31, 1997, unrealized gains on investments totaled
$668,124. The future income or loss of the Partnership is contingent
upon the performance of the portfolio investments.
<PAGE>
<PAGE>
SUBSEQUENT EVENTS
The Partnership is expected to receive disbursements of $96,750,
$48,375, and $48,375 on July 31, 1999, 2000, and 2001 related to the
escrow agreement from the liquidation of stock in Innovation Medical
Technologies, Inc. dated July 30, 1998. These disbursements are
contingent upon any claims against Innovation Medical Technologies, Inc.
LIQUIDITY AND CAPITAL RESOURCES
Total capital for the Partnership as of December 31, 1998, was
$525,703. This consisted of $436,053 in Limited Partner capital and
$89,650 in General Partner capital.
Net income of $484,256 for 1998 was allocated in the amount of
$394,426 to the Limited Partners and in the amount of $89,830 to the
General Partners.
At December 31, 1998, the Partnership had $212,383 in cash and
cash equivalents.
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.
<PAGE>
<PAGE>
Item 8. INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTARY
FINANCIAL DATA
Page
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Report of Independent Accountants 11
Schedule of Portfolio Investments as of
December 31, 1998 and 1997 12
Statements of Financial Condition as of December 31, 1998 and 1997 15
Statements of Income for the Years Ended
December 31, 1998, 1997 and 1996. 16
Statements of Cash Flows for the Years Ended
December 31, 1998, 1997 and 1996. 17
Statements of Changes in Partnership Capital for the
Years Ended December 31, 1998, 1997 and 1996. 18
Notes to Financial Statements. 19
Financial Statement Schedules:
All financial statement schedules are omitted because they are not
applicable or the required information is shown in the financial
statements or notes thereto.
<PAGE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Partners of
Community Investment Partners, L.P.
In our opinion, the accompanying Statements of Financial Condition,
including the Schedule of Portfolio Investments, and the related
Statements of Income, of Cash Flows and of Changes in Partnership
Capital present fairly, in all material respects, the financial position
of Community Investment Partners, L.P. (the "Partnership") at December
31, 1998 and 1997, and the results of its operations, its cash flows and
the changes in its Partnership Capital for each of the three years in
the period ended December 31, 1998, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Partnership's management; our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits of these financial statements in accordance with
generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe
that our audits, which included confirmation of portfolio investments
owned at December 31, 1998, provide a reasonable basis for the opinion
expressed above.
PRICEWATERHOUSECOOPERS LLP
St. Louis, Missouri
March 12, 1999
<PAGE>
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<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
As of December 31, 1998
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Company Nature of Business Fair Value
Investment Date Investment Cost (Note 3)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SAZTEC INTERNATIONAL, INC. Provides services for database
(SAZZ) construction and information
conversion
June 7, 1990 27,100 shares Common
Stock $ 78,324 $ 5,929
INTERMEDIA Organized to install and provide
COMMUNICATIONS OF private, dedicated telecommunication
FLORIDA (ICIX) lines using fiber optic cable
May 31, 1991 13,070 shares Common Stock 18,397 225,458
CITATION COMPUTERS Provides clinical
(CITA) laboratory information
October 31, 1991 13,680 shares of Common
Stock 33,578 23,085
ISOLYSER COMPANY, INC. Makes healthcare disposables
(OREX) from hot-water soluble
polymer
August 30, 1996 68,563 shares of Common
Stock 262,203 72,848
-------- --------
TOTAL INVESTMENTS $392,502 $327,320
======== ========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
As of December 31, 1997
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Company Nature of Business Fair Value
Investment Date Investment Cost (Note 3)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SAZTEC INTERNATIONAL, Provides services for database
INC. (SAZZ) construction and information
conversion
June 7, 1990 27,100 shares Common
Stock $ 78,324 $ 8,469
INTERMEDIA Organized to install and provide
COMMUNICATIONS OF private, dedicated telecommunication
FLORIDA (ICIX) lines using fiber optic cable
May 31, 1991 13,535 shares Common Stock 38,109 822,251
INNOVATION MEDICAL Manufactures highly specialized
TECHNOLOGIES, INC. medical instruments for use in
ophthalmic surgery
July 26, 1991 5,769 shares of 6% Class A
Cumulative Convertible
Preferred Stock 149,994 149,994
March 11, 1992 5,625 shares of 6% Class B
Convertible Preferred
Stock 90,000 90,000
September 30, 1992 5% Term Notes, due
December 31, 1997 40,763 40,763
Warrants to purchase
14,440 shares of Common Stock
at $2.50 per share, expiring 12/31/00 - -
May 26, 1994 5% Term Notes, due
December 31, 1997 15,008 15,008
Warrants to purchase
2,800 shares of
Common Stock at $5.00 per share,
expiring 12/31/02 - -
CITATION COMPUTERS Provides clinical
(CITA) laboratory information
October 31, 1991 13,680 shares of Common
Stock 33,578 88,920
The accompanying notes are an integral
part of these financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
As of December 31, 1997
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Company Nature of Business Fair Value
Investment Date Investment Cost (Note 3)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
VISION PARTNERS, L.P. Owns stock in Family
Vision Center, Inc., which
operates leased optical
departments in host stores
October 19, 1992 Limited Partnership
Interests $ 450,000 $ 450,000
December 1, 1993 Limited Partnership
Interests 124,965 124,965
ISOLYSER COMPANY, Makes healthcare disposables
INC. (OREX) from hot-water soluble
polymer
August 30, 1996 68,563 shares of Common
Stock 262,203 160,698
---------- ----------
TOTAL INVESTMENTS $1,282,944 $1,951,068
========== ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
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<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
ASSETS
------
December 31,
--------------------------
1998 1997
-------- ----------
<S> <C> <C>
Investments at Fair Value (Note 3)
(cost $392,502 and $1,282,944, respectively) $327,320 $1,951,068
Cash and Cash Equivalents 212,383 146,085
Accrued Dividend and Interest Receivable - 59,784
-------- ----------
TOTAL ASSETS $539,703 $2,156,937
======== ==========
LIABILITIES AND PARTNERSHIP CAPITAL
-----------------------------------
December 31,
--------------------------
1998 1997
-------- ----------
<S> <C> <C>
Liabilities:
Accrued Expenses $ 14,000 $ 13,000
-------- ----------
TOTAL LIABILITIES 14,000 13,000
-------- ----------
Partnership Capital:
Capital - Limited Partners 436,053 1,754,109
Capital - General Partners 89,650 389,828
-------- ----------
TOTAL PARTNERSHIP CAPITAL 525,703 2,143,937
-------- ----------
TOTAL LIABILITIES AND
PARTNERSHIP CAPITAL $539,703 $2,156,937
======== ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENTS OF INCOME
<CAPTION>
For the Years Ended
December 31,
----------------------------------------------
1998 1997 1996
---------- --------- ----------
<S> <C> <C> <C>
INCOME
------
Dividend and Interest Income $ 8,723 $ 56,358 $ 11,486
---------- --------- ----------
TOTAL INCOME 8,723 56,358 11,486
---------- --------- ----------
EXPENSES
--------
Professional Fees 24,956 17,633 12,274
Other 3,524 986 1,628
---------- --------- ----------
TOTAL EXPENSES 28,480 18,619 13,902
---------- --------- ----------
Net (Loss) Income before Net Realized
Gains and Net Unrealized Losses (19,757) 37,739 (2,416)
Net Realized Gains on
Sale of Investments (Note 6) 1,237,319 486,662 1,647,498
Net Unrealized Losses
on Investments (733,306) (254,746) (652,959)
---------- --------- ----------
NET INCOME $ 484,256 $ 269,655 $ 992,123
========== ========= ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENTS OF CASH FLOWS
<CAPTION>
For the Years Ended
December 31,
-----------------------------------------------
1998 1997 1996
----------- --------- -----------
<S> <C> <C> <C>
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Net income $ 484,256 $ 269,655 $ 992,123
Adjustments to reconcile net income
to net cash provided by operating activities:
Purchase of portfolio investments - (1,197) (262,184)
Sale of portfolio investments 2,127,761 623,736 2,132,188
Unrealized losses on
portfolio investments 733,306 254,746 652,959
Net realized gains on
sale of portfolio investments (1,237,319) (486,662) (1,647,498)
Decrease (increase) in accrued dividend
and interest receivable 59,784 (56,358) 4,596
Increase in accrued expenses 1,000 900 -
Decrease in accounts payable - - (30,918)
----------- --------- -----------
Net cash provided by
operating activities 2,168,788 604,820 1,841,266
----------- --------- -----------
CASH FLOWS USED IN FINANCING ACTIVITIES:
Capital distributions (2,102,490) (539,100) (2,156,400)
----------- --------- -----------
Net cash used in financing activities (2,102,490) (539,100) (2,156,400)
----------- --------- -----------
Net increase (decrease) in cash and
cash equivalents 66,298 65,720 (315,134)
CASH AND CASH EQUIVALENTS:
Beginning of year 146,085 80,365 395,499
----------- --------- -----------
End of year $ 212,383 $ 146,085 $ 80,365
=========== ========= ===========
The accompanying notes are an integral
part of these financial statements.
</TABLE> <PAGE>
<PAGE>
<TABLE>
COMMUNITY INVESTMENT PARTNERS, L.P.
STATEMENTS OF CHANGES IN PARTNERSHIP CAPITAL
For the Years Ended December 31, 1998, 1997 and 1996
<CAPTION>
LIMITED GENERAL
PARTNERS PARTNERS TOTAL
----------- --------- -----------
<S> <C> <C> <C>
Balance, December 31, 1995 $ 2,921,886 $ 655,773 $ 3,577,659
Distribution (1,756,400) (400,000) (2,156,400)
Net Income 808,089 184,034 992,123
----------- --------- -----------
Balance, December 31, 1996 $ 1,973,575 $ 439,807 $ 2,413,382
Distribution (439,100) (100,000) (539,100)
Net Income 219,634 50,021 269,655
----------- --------- -----------
Balance, December 31, 1997 $ 1,754,109 $ 389,828 $ 2,143,937
Distribution (1,712,482) (390,008) (2,102,490)
Net Income 394,426 89,830 484,256
----------- --------- -----------
Balance, December 31, 1998 $ 436,053 $ 89,650 $ 525,703
=========== ========= ===========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
<PAGE>
<PAGE>
COMMUNITY INVESTMENT PARTNERS, L.P.
NOTES TO FINANCIAL STATEMENTS
1. GENERAL
Partnership Organization
-------------------------
Community Investment Partners, L.P. (the "Partnership") was
formed on October 10, 1989, under the Revised Uniform Limited
Partnership Act of Missouri. CIP Management, L.P., LLLP, the Managing
General Partner, is a Missouri limited liability limited partnership
formed on October 10, 1989 as a limited partnership and registered as a
limited liability limited partnership on July 23, 1997. The general
partner of CIP Management, L.P., LLLP is CIP Management, Inc., an
indirect subsidiary of Edward D. Jones & Co., L.P.
Business
--------
The Partnership 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 assets in qualifying investments as specified in the Investment
Company Act. The Managing General Partner is responsible for making the
Partnership's investment decisions.
The Partnership has sought and will continue to seek long-
term capital appreciation by making investments in companies and other
special investment situations. The Partnership is not permitted to
engage in any other business or activity. The Partnership will dissolve
on December 31, 2005, subject to the right of the Individual General
Partners to extend the term for up to two additional two-year periods.
As of December 31, 1992, the Partnership is no longer making
initial portfolio investments, but may continue to make follow-on
investments.
Risk of Ownership
-----------------
The purchase and ownership of Partnership Units involve a
number of significant risks and other important factors. The portfolio
company investments of the Partnership involve a high degree of business
and financial risk that can result in substantial losses. Among these
are the risks associated with investments in companies with little
operating history, companies operating at a loss or with substantial
variations in operating results from period to period, companies with
the need for substantial additional capital to support expansion or
achieve or maintain a competitive position, companies which may be
highly leveraged, companies which may not be diversified and companies
in which the Partnership may be the sole or primary lender. The
Partnership intends to invest in only a few companies; therefore, a loss
or other problem with a single investment would have a material adverse
effect on the Partnership.
2. ALLOCATION OF PARTNERSHIP PROFITS AND LOSSES
The Partnership Agreement generally provides for the allocation
of profits and losses pro rata based on the Partners' capital
contributions. Refer to the Partnership Agreement for more detailed
information.
<PAGE>
<PAGE>
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash and Cash Equivalents
-------------------------
All short-term investments with original maturities of three
months or less are considered to be cash equivalents.
Investment Transactions
-----------------------
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.
Use of Estimates
----------------
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of
the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could
differ from those estimates.
Income Taxes
------------
Income taxes have not been provided for as the Partnership
is a limited partnership and each partner is liable for its own tax
payments. Allocation of Partnership profits and losses for tax purposes
is based upon taxable income which may differ from net income for
financial reporting primarily due to differences between book and tax
accounting for portfolio investments.
Distributions
-------------
When excess cash, if any, becomes available, it is the
Partnership's intent to make distributions. All distributions are
subject to the sole discretion of the Managing General Partner and the
Independent General Partners.
<PAGE>
<PAGE>
4. PER UNIT INFORMATION
There is no market for the Limited Partnership interests. Per
Unit Information is as follows:
<TABLE>
<CAPTION>
For the Years Ended December 31,
---------------------------------------------
1998 1997 1996
--------- -------- --------
<S> <C> <C> <C>
Number of unit holders 104 104 105
========= ======== ========
Limited partnership units 87,820 87,820 87,820
General partnership units 20,000 20,000 20,000
--------- -------- --------
Total units outstanding 107,820 107,820 107,820
========= ======== ========
Net asset value per unit $ 4.88 $ 19.88 $ 22.38
========= ======== ========
Net income per unit $ 4.49 $ 2.50 $ 9.20
========= ======== ========
</TABLE>
5. RELATED PARTY TRANSACTIONS
The Partnership is furnished with certain non-reimbursed
management and accounting services by affiliates, which are not
reflected in the accompanying financial statements.
The Partnership may place its General Partners on Boards of
Directors of portfolio companies.
The Managing General Partner and the Independent General
Partners of the Partnership are also the managing general partner and
independent general partners, respectively, of Community Investment
Partners II, L.P., a business development company. Additionally, the
Managing General Partner is the managing general partner of Community
Investment Partners III L.P., LLLP, another business development
company.
<PAGE>
<PAGE>
6. INVESTMENT TRANSACTIONS
Following is a summary of portfolio investment transactions
during the years ended December 31, 1998, 1997 and 1996, respectively.
<TABLE>
<CAPTION>
For the year ended December 31, 1998
------------------------------------
Type of Realized
Company Investment Cost Proceeds Gain (Loss)
------- ---------- -------- ---------- ----------
<S> <C> <C> <C> <C>
SALES:
Innovation Medical Term Notes
Technologies, Inc. and Warrants $ 40,763 $ 40,763 $ -
Innovation Medical Term Notes
Technologies, Inc. and Warrants 15,008 15,008 -
Innovation Medical Liquidation of
Technologies, Inc. Preferred Stock 239,994 1,410,596 1,170,602
Intermedia Communications
of Florida Common Stock 19,712 546,919 527,207
Vision Partners, L.P. Liquidation of
Limited
Partnership
Interests 574,965 114,475 (460,490)
-------- ---------- ----------
TOTAL SALES $890,442 $2,127,761 $1,237,319
======== ========== ==========
</TABLE>
During 1998, there was a two-for-one stock split on Intermedia
Communications of Florida common stock. The Partnership's 6,535
remaining shares of common stock were converted into a total of 13,070
shares of common stock.
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
For the year ended December 31, 1997
------------------------------------
Type of Realized
Company Investment Cost Proceeds Gain (Loss)
------- ---------- -------- -------- ----------
<S> <C> <C> <C> <C>
PURCHASES:
Intermedia Communications Exercises of
of Florida Warrants $ 1,197
--------
TOTAL PURCHASES $ 1,197
========
SALES:
Intermedia Communications
of Florida Common Stock $ 33,088 $422,268 $389,180
Isolyser Company, Inc. Common Stock 87,860 76,622 (11,238)
PDT, Inc. Common Stock 9,294 101,047 91,753
Citation Computers Common Stock 6,832 23,799 16,967
-------- -------- --------
TOTAL SALES $137,074 $623,736 $486,662
======== ======== ========
</TABLE>
During 1997, there was a one-for-four reverse stock split on Saztec
International, Inc. common stock. The Partnership's 108,400 shares
of common stock were converted to 27,100 shares of common stock.
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
For the year ended December 31, 1996
------------------------------------
Type of Realized
Company Investment Cost Proceeds Gain (Loss)
------- ---------- -------- -------- ----------
<S> <C> <C> <C> <C>
PURCHASES:
Micro Partners, L.P. Limited
Partnership
Interests $256,413
Innovation Medical
Technologies, Inc. Term Notes 5,771
--------
TOTAL PURCHASES $262,184
========
SALES:
Intermedia Communications Common Stock $126,000 $1,005,563 $879,563
Citation Computers Common Stock 148,840 679,375 530,535
Isolyser Company, Inc. Common Stock 206,350 443,750 237,400
Innovation Medical
Technologies, Inc. Term Notes 3,500 3,500 -
-------- ---------- ----------
TOTAL SALES $484,690 $2,132,188 $1,647,498
======== ========== ==========
</TABLE>
As of December 31, 1995, the Partnership held a $300,000 limited
partnership investment in Micro Partners, L.P. During 1996, an
additional investment of $256,413 was made in Micro Partners, L.P.
Subsequent to this investment, the Micro Partners, L.P. partnership was
dissolved and the Partnership received 88,220 shares of common stock in
Microtek. Then, Microtek merged with Isolyser Company and the
Partnership received 145,563 shares of Isolyser Company stock.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURES
None
<PAGE>
<PAGE>
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
There are two Independent General Partners and one Managing
General Partner of the Partnership. These Independent General Partners
and the Managing General Partner are responsible for the management and
administration of the Partnership. The General Partners are "interested
persons" of the Partnership as defined by the Investment Company Act of
1940, but the Partnership has obtained an exemptive order from the
Securities and Exchange Commission permitting them to be considered
disinterested persons. The Independent General Partners provide overall
guidance and supervision with respect to the operations of the
Partnership and perform the various duties imposed on the directors of a
business development company by the Investment Company Act. In addition
to general fiduciary duties, the Independent General Partners supervise
the management and underwriting arrangement of the Partnership, the
custody arrangement with respect to portfolio securities, the selection
of accountants, fidelity bonding and transactions with affiliates.
Specific Information regarding the Independent General Partners:
Tommy L. Gleason, Jr., 53, has been an Independent General Partner
of the Partnership since February 1990. He is also an independent
general partner of Community Investment Partners II, L.P., a business
development company. Mr. Gleason is the Chairman and Chief Executive
Officer of Galaxy Systems Management, Inc., the general Partner of
Galaxy Telecom, L.P., which is involved in management of cable
television systems located in sixteen states and serving approximately
175,000 subscribers. Mr. Gleason owns 4,000 Units.
E. Stanley Kroenke, 51, has served as an Independent General
Partner of the Partnership since February 1990. He is also an
independent general partner of Community Investment Partners II, L.P., a
business development company. Mr. Kroenke leads a company that is a
national investor, developer, and owner of commercial real estate. The
company is a developer and owner of numerous shopping centers, office
buildings and apartment projects around the country. Mr. Kroenke is co-
owner of the St. Louis Rams National Football League franchise. He
serves as a member of the board of directors of Wal-Mart Stores, Inc.,
Bentonville, Arkansas; Central Bancompany, Jefferson City, Missouri; and
Boone County National Bank, Columbia, Missouri. He is a trustee of the
College of the Ozarks in Point Lookout, Missouri. He also serves on the
boards of the Greater St. Louis Area Council Boy Scouts of America and
the St. Louis Art Museum. Mr. Kroenke owns 4,000 Units.
CIP Management, L.P., LLLP, (the "Managing General Partner") is
the Managing General Partner of Community Investment Partners, L.P. The
Managing General Partner is also managing general partner of Community
Investment Partners II, L.P. and Community Investment Partners III L.P.,
LLLP, which are also business development companies. The General
Partners of the Managing General Partner are CIP Management, Inc., a
Missouri corporation and a wholly-owned subsidiary of Edward D. Jones &
Co., L.P., and Daniel A. Burkhardt.
<PAGE>
<PAGE>
The Directors and Officers of CIP Management, Inc. are as follows:
Daniel A. Burkhardt, 51, President, Treasurer and Director of CIP
Management, Inc. since October 1989 and general partner of CIP
Management, L.P., LLLP since February 1990. He is a general partner of
The Jones Financial Companies, L.L.L.P., the parent company of Edward D.
Jones & Co., L.P. where he has specialized in investment banking and
structuring investments since 1980. He is also a director of St.
Joseph Light & Power Co. and SEMCO Energy, Inc. Mr. Burkhardt is the
beneficial owner of 2,105 Units.
Ray L. Robbins, Jr., 54, Vice President and Director of CIP
Management, Inc. since October 1989. He is a general partner of The
Jones Financial Companies, L.L.L.P., the parent company of Edward D.
Jones & Co., L.P., where he has specialized in securities analysis since
1984, and where he was responsible for municipal bond transactions from
1975 to 1983. Mr. Robbins is Co-Chairman of the Edward D. Jones & Co.,
L.P. Investment Policy Committee. Mr. Robbins is a beneficial owner of
2,000 Units.
Marilyn A. Gaffney, 40, Secretary of CIP Management, Inc. since
October 1989. She is a Limited Partner of The Jones Financial
Companies, L.L.L.P., the parent company of Edward D. Jones & Co., L.P.,
where she has been a senior investment adviser in investment banking
since 1980. Ms. Gaffney is the beneficial owner of 200 Units.
Item 11. EXECUTIVE COMPENSATION
The information set forth under the caption "Partnership
Distributions and Allocations" in the Prospectus of the Partnership
dated March 12, 1990, filed with the Securities and Exchange Commission
pursuant to Rule 497(b) under the Securities Act of 1933, is
incorporated herein by reference.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The information concerning the security ownership of the General
Partner, Independent General Partners and the Officers and Directors of
CIP Management, Inc., described in Items 1 and 10, is herein
incorporated by reference.
As of March 15, 1999, the following parties are known by the
Partnership to be the beneficial owners of more than 5% of the Units.
<TABLE>
<CAPTION>
Amount of
Beneficial % of Limited
Name Ownership of Units Partnership Capital
- ---- ---------------------------------------------
<S> <C> <C>
Iowa Illinois Investment Co. 10,000 11.39%
EDJ Ventures Ltd. 19,800 22.55%
Richard P. Kiphart 4,590 5.23%
</TABLE>
The Partnership is not aware of any arrangement which may, at a
subsequent date, result in a change of control of the Partnership.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain relationships and related transactions, described in Item
10, are herein incorporated by reference.
<PAGE>
<PAGE>
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
a. The following documents are filed as part of this report:
1. Financial Statements:
--------------------
See Index to Financial Statements and Supplementary
Data contained in Item 8 of this Form 10-K.
2. Financial Statement Schedules:
-----------------------------
All financial statement schedules are omitted because they
are not applicable or the required information is
included in the balance sheet or notes thereto.
3. Exhibits:
--------
(3) Amended and Restated Certificate and Agreement of
Limited Partnership dated as of March 29, 1990.
(4) Form of Unit Certificate.<F*>
(10) Management Agreement dated March 28, 1990, between the
Partnership and CIP Management, L.P., LLLP<F**>
(28) Prospectus of the Partnership dated March 12, 1990,
filed with the Securities and Exchange
Commission in connection with Registration
Statement No. 33-31649 on Form N-2 under the
Securities Act of 1933. <F***>
[FN]
<F*> Incorporated by reference to Exhibit A of the
Prospectus of the Partnership dated March 12,
1990 filed with the Securities and Exchange
Commission pursuant to Rule 497(b) under the
Securities Act of 1933.
<F**> Incorporated by reference to the Partnership's Proxy
Statement filed with the Securities Exchange
Commission on March 11, 1991.
<F***>Incorporated by reference to the Partnership's
Registration Statement No. 33-31649 on Form N-2
under the Securities Act of 1933.
b. No reports on Form 8-K were filed during the quarter ended
December 31, 1998.
c. Exhibits filed as part of this report are included in Item
(14) (a)(3) above.
d. All financial statement schedules are omitted because they
are not applicable or the required information is
included in the balance sheet or notes thereto.
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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, on
this 22nd day of March, 1999.
Community Investment Partners, L.P.
By: CIP Management, L.P., LLLP, its
Managing General Partner
By: CIP Management, Inc., its
Managing General Partner
/s/ Daniel A. Burkhardt, President
-----------------------------------------
By: Daniel A. Burkhardt, President
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the Registrant and in the capacities indicated.
/s/ Daniel A. Burkhardt
- ------------------------------ General Partner of CIP Management
Daniel A. Burkhardt L.P., LLLP, President, Treasurer and
Director of CIP Management, Inc.
/s/ Ray L. Robbins
- ------------------------------ Vice President and Director of CIP
Ray L. Robbins Management, Inc.
/s/ Tommy L. Gleason, Jr.
- ------------------------------ Individual General Partner,
Tommy L. Gleason, Jr. Community Investment Partners, L.P.
/s/ E. Stanley Kroenke
- ------------------------------ Individual General Partner,
E. Stanley Kroenke Community Investment Partners, L.P.
<PAGE>
<PAGE>
<TABLE>
INDEX TO EXHIBITS
<CAPTION>
Exhibit
Number Description of Exhibit Page
- ------ ---------------------- ----
<C> <S> <C>
(3) Amended and Restated Certificate and
Agreement of Limited Partnership dated
as of March 29, 1990 <F*>
(4) Form of Unit Certificate <F*>
(10) Management Agreement dated March 28, 1990,
between the Partnership and CIP Management,
L.P., LLLP <F*>
(28) Prospectus of the Partnership dated March 12,
1990, filed with the Securities and Exchange
Commission in connection with Registration
Statement No. 33-31649 on Form N-2 under the
Securities Act of 1933 <F*>
<FN>
______________________
<F*>Incorporated by reference
</TABLE>
<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
year ended December 31, 1998 and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<INVESTMENTS-AT-COST> 392,502
<INVESTMENTS-AT-VALUE> 327,320
<RECEIVABLES> 0
<ASSETS-OTHER> 212,383
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 539,703
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 14,000
<TOTAL-LIABILITIES> 14,000
<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> 525,703
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 8,723
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 1,237,319
<APPREC-INCREASE-CURRENT> (733,306)
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> (2,102,490)
<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> 28,480
<AVERAGE-NET-ASSETS> 1,334,820
<PER-SHARE-NAV-BEGIN> 19.88
<PER-SHARE-NII> 4.49
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (19.50)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 4.88
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
