<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Quarterly Report Under Section 13
or 15 (d) of the Securities
Exchange Act of 1934
For the Quarter Ended
September 30, 1998 Commission File Number 0-19466
--------------------- -------------------------------
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
----------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 36-3684373
- --------------------------------------- -------------------------------
State or other jurisdiction of IRS Employer Identification
incorporation or organization Number
1300 E. Woodfield Road, Suite 312 Schaumburg, Illinois 60173
- --------------------------------------- -------------------------------
Address of principal executive offices City, State, Zip Code
Registrant's telephone number: (847)240-6200
-------------------------------
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.
(1) Yes x No
--- ---
(2) Yes x No
--- ---
<PAGE> 2
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 1998
PART I - FINANCIAL INFORMATION
<TABLE>
<S> <C>
Item 1.
Index to Financial Statements
Balance Sheets
September 30, 1998 (unaudited) 3
December 31, 1997 4
Statements of Revenue and Expenses (unaudited)
For the three months ended September 30, 1998 5
For the three months ended September 30, 1997 6
For the nine months ended September 30, 1998 7
For the nine months ended September 30, 1997 8
Statements of Changes in Partners' Equity
For the nine months ended September 30, 1998
(unaudited) 9
Statements of Cash Flows (unaudited)
For the nine months ended September 30, 1998 10
For the nine months ended September 30, 1997 11
Notes to Financial Statements (unaudited) 12-13
Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations 14-16
PART II - OTHER INFORMATION
Items 1-6. 17
</TABLE>
2
<PAGE> 3
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
BALANCE SHEETS
September 30, 1998
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ---------- ----------
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents $1,010,643 $1,875,827 $2,886,470
Investments in commercial lease
paper, net 217 3,338 3,555
Net investment in direct
financing leases -- 1,439,544 1,439,544
Diverted and other assets, net 778,877 3,816,267 4,595,144
Datronic assets, net -- -- --
---------- ---------- ----------
$1,789,737 $7,134,976 $8,924,713
========== ========== ==========
LIABILITIES AND PARTNERS' EQUITY
Accounts payable and accrued
expenses $ 6,122 $ 50,710 $ 56,832
Lessee rental deposits 33,007 165,829 198,836
---------- ---------- ----------
Total liabilities 39,129 216,539 255,668
Total partners' equity 1,750,608 6,918,437 8,669,045
---------- ---------- ----------
$1,789,737 $7,134,976 $8,924,713
========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 4
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
BALANCE SHEETS
December 31, 1997
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
---------- ---------- ----------
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents $1,199,924 $1,874,453 $3,074,377
Investments in commercial lease
paper, net 2,072 22,939 25,011
Net investment in direct
financing leases -- 2,866,165 2,866,165
Diverted and other assets, net 778,877 3,816,267 4,595,144
Datronic assets, net -- -- --
---------- ---------- -----------
$1,980,873 $8,579,824 $10,560,697
========== ========== ===========
LIABILITIES AND PARTNERS' EQUITY
Accounts payable and
accrued expenses $ 6,814 $ 55,502 $ 62,316
Lessee rental deposits 41,971 253,663 295,634
---------- ---------- -----------
Total liabilities 48,785 309,165 357,950
Total partners' equity 1,932,088 8,270,659 10,202,747
---------- ---------- -----------
$1,980,873 $8,579,824 $10,560,697
========== ========== ===========
</TABLE>
See accompanying notes to financial statements.
4
<PAGE> 5
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENTS OF REVENUE AND EXPENSES
For the three months ended September 30, 1998
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ---------- ----------
<S> <C> <C> <C>
Revenue:
Lease income $ 407 $ 58,835 $ 59,242
Interest income 4,778 29,080 33,858
----------- ---------- ----------
5,185 87,915 93,100
----------- ---------- ----------
Expenses:
General Partner's expense
reimbursement 30,866 223,467 254,333
Professional fees 2,897 22,357 25,254
Other operating expenses 1,077 5,339 6,416
Credit for lease losses (2,192) (10,737) (12,929)
----------- ---------- ----------
32,648 240,426 273,074
----------- ---------- ----------
Net loss $ (27,463) $ (152,511) $ (179,974)
=========== ========== ==========
Net loss --
General Partner $ (275) $ (1,525) $ (1,800)
=========== ========== ==========
Net loss --
Limited Partners $ (27,188) $ (150,986) $ (178,174)
=========== ========== ==========
Net loss per limited
partnership unit $ (.80) $ (.91)
=========== ==========
Weighted average number
of limited partnership units
outstanding 33,858 165,901
=========== ==========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE> 6
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENTS OF REVENUE AND EXPENSES
For the three months ended September 30, 1997
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ---------- ---------
<S> <C> <C> <C>
Revenue:
Lease income (loss) $ (936) $ 128,215 $ 127,279
Interest income 6,552 36,496 43,048
----------- --------- ---------
5,616 164,711 170,327
----------- --------- ---------
Expenses:
General Partner's
expense reimbursement 47,349 295,499 342,848
Professional fees 21,456 113,236 134,692
Other operating expenses 3,001 14,877 17,878
Credit for lease losses (12,722) (62,334) (75,056)
Credit for loss on commercial
lease paper (2,542) (32,458) (35,000)
----------- --------- ---------
56,542 328,820 385,362
----------- --------- ---------
Net loss $ (50,926) $(164,109) $(215,035)
=========== ========= =========
Net loss --
General Partner $ (509) $ (1,641) $ (2,150)
=========== ========= =========
Net loss --
Limited Partners $ (50,417) $(162,468) $(212,885)
=========== ========= =========
Net loss per limited
partnership unit $ (1.49) $ (.98)
=========== =========
Weighted average number
of limited partnership units
outstanding 33,858 165,901
=========== =========
</TABLE>
See accompanying notes to financial statements.
6
<PAGE> 7
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENTS OF REVENUE AND EXPENSES
For the nine months ended September 30, 1998
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ---------- -----------
<S> <C> <C> <C>
Revenue:
Lease income $ 926 $ 241,560 $ 242,486
Interest income 14,030 88,597 102,627
---------- --------- -----------
14,956 330,157 345,113
---------- --------- -----------
Expenses:
General Partner's expense
reimbursement 93,024 648,611 741,635
Professional fees 104,058 531,480 635,538
Other operating expenses 6,049 35,089 41,138
Credit for lease losses (6,695) (32,801) (39,496)
---------- --------- -----------
196,436 1,182,379 1,378,815
---------- --------- -----------
Net loss $(181,480) $(852,222) $(1,033,702)
========= ========= ===========
Net loss --
General Partner $ (1,815) $ (8,522) $ (10,337)
========= ========= ===========
Net loss --
Limited Partners $(179,665) $(843,700) $(1,023,365)
========= ========= ===========
Net loss per limited
partnership unit $ (5.31) $ (5.09)
========= =========
Weighted average number
of limited partnership units
outstanding 33,858 165,901
========= =========
</TABLE>
See accompanying notes to financial statements.
7
<PAGE> 8
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENTS OF REVENUE AND EXPENSES
For the nine months ended September 30, 1997
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ---------- ----------
<S> <C> <C> <C>
Revenue:
Lease income $ 3,077 $ 483,992 $ 487,069
Interest income 16,913 107,021 123,934
----------- ---------- ----------
19,990 591,013 611,003
----------- ---------- ----------
Expenses:
General Partner's
expense reimbursement 160,742 929,879 1,090,621
Professional fees 53,434 300,378 353,812
Other operating expenses 6,477 33,897 40,374
Credit for lease losses (48,181) (166,072) (214,253)
Credit for loss on commercial
lease paper (2,542) (32,458) (35,000)
----------- ---------- ----------
169,930 1,065,624 1,235,554
----------- ---------- ----------
Net loss $ (149,940) $ (474,611) $ (624,551)
=========== ========== ==========
Net loss --
General Partner $ (1,499) $ (4,746) $ (6,245)
=========== ========== ==========
Net loss --
Limited Partners $ (148,441) $ (469,865) $ (618,306)
=========== ========== ==========
Net loss per limited
partnership unit $ (4.38) $ (2.83)
=========== ==========
Weighted average number
of limited partnership units
outstanding 33,858 165,901
=========== ==========
</TABLE>
See accompanying notes to financial statements.
8
<PAGE> 9
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENT OF CHANGES IN PARTNERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
General Limited Limited Total
Partner's Partners' Partners' Partners'
Equity Equity Equity Equity
--------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Balance, December 31, 1997* $ -- $1,932,088 $8,270,659 $10,202,747
Distributions to partners -- -- (500,000) (500,000)
Net loss (10,337) (179,665) (843,700) (1,033,702)
Allocation of General
Partner's Equity 10,337 (1,815) (8,522) --
--------- ---------- ---------- ------------
Balance, September 30, 1998 $ -- $1,750,608 $6,918,437 $ 8,669,045
========== ========== ========== ===========
</TABLE>
* Balances are net of $74,954 and $678,650, of General Partner's equity
previously allocated to Liquidating and Continuing Limited Partners'
Equity.
See accompanying notes to financial statements.
9
<PAGE> 10
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENTS OF CASH FLOWS
For the nine months ended September 30, 1998
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ---------- -----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (181,480) $(852,222) $(1,033,702)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Credit for lease losses (6,695) (32,801) (39,496)
Changes in assets and liabilities:
Accounts payable and accrued
expenses (692) (4,792) (5,484)
Lessee rental deposits (8,964) (87,834) (96,798)
----------- ---------- -----------
(197,831) (977,649) (1,175,480)
----------- ---------- -----------
Cash flows from investing activities:
Principal collections on leases 6,695 1,459,422 1,466,117
Repayments of commercial lease paper 1,855 19,601 21,456
----------- ---------- -----------
8,550 1,479,023 1,487,573
----------- ---------- -----------
Cash flows from financing activities:
Distributions to Limited Partners -- (500,000) (500,000)
----------- ---------- -----------
Net increase (decrease) in cash and
cash equivalents (189,281) 1,374 (187,907)
Cash and cash equivalents:
Beginning of year 1,199,924 1,874,453 3,074,377
----------- ---------- -----------
End of third quarter $ 1,010,643 $1,875,827 $ 2,886,470
=========== ========== ===========
</TABLE>
See accompanying notes to financial statements.
10
<PAGE> 11
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
STATEMENTS OF CASH FLOWS
For the nine months ended September 30, 1997
(unaudited)
<TABLE>
<CAPTION>
Liquidating Continuing
Limited Limited
Partners Partners Total
----------- ----------- -----------
<S> <C> <C> <C>
Cash flows used for operating activities:
Net loss $ (149,940) $ (474,611) $ (624,551)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Credit for lease losses (48,181) (166,072) (214,253)
Credit for loss on commercial
lease paper (2,542) (32,458) (35,000)
Changes in assets and liabilities:
Accounts payable and accrued
expenses (31,010) (171,719) (202,729)
Lessee rental deposits (27,230) (184,972) (212,202)
Due from management company 7,747 51,383 59,130
--------- --------- ---------
(251,156) (978,449) (1,229,605)
---------- ---------- ----------
Cash flows from investing activities:
Principal collections on leases 55,228 2,403,782 2,459,010
Repayments of commercial lease paper 8,783 71,142 79,925
---------- ---------- ----------
64,011 2,474,924 2,538,935
---------- ---------- ----------
Cash flows used for financing activities:
Distributions to Limited Partners -- (1,500,147) (1,500,147)
Distributions to General Partner -- (13,289) (13,289)
---------- ---------- ----------
-- (1,513,436) (1,513,436)
---------- ---------- ----------
Net decrease in cash and cash equivalents (187,145) (16,961) (204,106)
Cash and cash equivalents:
Beginning of year 1,446,892 2,130,637 3,577,529
---------- ---------- ----------
End of third quarter $1,259,747 $2,113,676 $3,373,423
========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
11
<PAGE> 12
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
NOTES TO FINANCIAL STATEMENTS
September 30, 1998
(unaudited)
NOTE 1 -- ORGANIZATION:
- -----------------------
Datronic Equipment Income Fund XIX, L.P., a Delaware Limited Partnership (the
"Partnership"), was formed on December 22, 1989 for the purpose of acquiring
and leasing both high-and low-technology equipment. See Notes 5, 8, and 10 to
the Partnership's financial statements included in the 1997 Form 10-K for a
discussion of the alleged diversion of Partnership assets in 1991 and 1992 and
the subsequent litigation and settlement, change in general partner, new
classes of limited partners established and amendments to the Partnership
Agreement which occurred.
NOTE 2 -- BASIS OF FINANCIAL STATEMENTS:
- ----------------------------------------
The accompanying financial statements should be read in conjunction with the
Partnership's financial statements included in the 1997 Form 10-K. The
financial information furnished herein is unaudited but in the opinion of
Management includes all adjustments necessary (all of which are normal
recurring adjustments) for a fair presentation of financial condition and
results of operations. See Note 2 to the Partnership's financial statements
included in the 1997 Form 10-K.
NOTE 3 -- LIMITED PARTNERSHIP DISTRIBUTIONS:
- --------------------------------------------
Distributions to Liquidating Limited Partners were suspended after payment of
the October 1, 1995 distribution. Distributions to Continuing Limited Partners
were suspended after payment of the January 1, 1998 distribution.
NOTE 4 -- SETTLEMENT OF LITIGATION:
- -----------------------------------
On May 5, 1998, Lease Resolution Corporation (LRC), on behalf of Datronic
Equipment Income Funds XVI, XVII, XVIII, XIX, XX and Datronic Finance Income
Fund I, reached an agreement to settle all claims of the aforementioned
partnerships against Weiss & Co. The settlement was contingent upon the
subsequent approval by the United States District Court for the Northern
District of Illinois, Eastern Division (the "District Court") dismissing Weiss
& Co. as a party defendant. On August 19, 1998, the District Court entered an
order dismissing Weiss & Co. as a party defendant, and on September 20, 1998,
$2,437,331 was transferred to LRC in full and final settlement of the Weiss
matter. In connection with this matter, a total of $1,410,950 of expenses
($708,600 for the nine months ended September 30, 1998) consisting primarily of
legal fees, was incurred. After payment of contingent legal fees of $609,333,
a total of $1,827,998 is available for transfer to the Datronic Partnerships.
LRC will determine the appropriate allocation of these amounts among the
Partnerships after resolution of the post-trial motions filed in the Price
Waterhouse matter.
12
<PAGE> 13
On June 10, 1998 a verdict was rendered finding Price Waterhouse liable for
negligence, but not guilty of breach of contract. On July 20, 1998, LRC and
Price Waterhouse both filed post-trial motions requesting relief from the
Court. The Court is not expected to rule on these motions for several months.
13
<PAGE> 14
PART I
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS
- ---------------------
The following discussion and analysis of liquidity and capital resources covers
material changes in the Partnership's financial condition from December 31,
1997 through September 30, 1998. The discussion and analysis of results of
operations is for the three and nine month periods ended September 30, 1998 as
compared to the corresponding periods in 1997.
Liquidity and Capital Resources
- -------------------------------
During the nine months ended September 30, 1998, Partnership assets continued
to be converted to cash in order to pay Partnership operating expenses,
liquidate Partnership liabilities, make distributions to limited partners and
provide for the ultimate liquidation of the Partnership.
During the nine months ended September 30, 1998, the Partnership's cash and
cash equivalents decreased by $188,000 to $2,886,000 at September 30, 1998 from
$3,074,000 at December 31, 1997. This decrease is primarily due to the use of
cash in operations of $1,175,000 and distributions to partners of $500,000,
partially offset by cash receipts from collections on leases of $1,466,000 and
from commercial lease paper of $21,000.
The Partnership's sources of liquidity on both a long-term and short-term basis
are expected to come principally from cash-on-hand and cash receipts from
leases owned by the Partnership. The lease portfolio is scheduled to be
substantially run out by the end of 2000, unless it is determined that it is in
the Partnership's best interest to dispose of the remaining portfolio earlier.
In addition, the Partnership's sources of liquidity on a long-term basis
includes proceeds from the sale of Diverted and other assets. Management
believes that these sources of liquidity in the short and long-term are
sufficient to meet operating cash requirements, provide for ongoing pursuit of
litigation, and an orderly liquidation of the Partnership.
The continued operation and eventual liquidation of the Partnership involves
complex issues some of which have been resolved. These issues relate to the
timing and the amount to be realized from the liquidation of lease-related
assets, Diverted and other assets, Datronic assets, litigation and the
liquidation of the other Datronic Partnerships. These issues make it difficult
to predict the time and costs necessary to operate and liquidate the
Partnership in an orderly manner. Through the second quarter of 1998, it
appeared unlikely that the Partnership would make any additional distributions
until such time as its remaining assets were liquidated and the pending
litigation was resolved. Now that additional assets have been liquidated the
General Partner has determined that an interim cash distribution will be paid
to the Limited Partners shortly after the end of the first quarter 1999. The
General Partner is in the process
14
<PAGE> 15
of determining the amount that will be available for this distribution and its
allocation among each class of Limited Partner. This distribution will be made
to owners of record as of December 31, 1998 even if their units are subsequently
sold.
Results of Operations
- ---------------------
The Partnership had a net loss of $180,000 and $1,034,000 for the three and
nine months ended September 30, 1998, respectively, in the aggregate for all
classes of partners. This compares to an aggregate net loss of $215,000 and
$625,000 for the same periods in 1997, respectively. Differences in operating
results between Liquidating and Continuing Limited Partners are attributable to
lease income, acquisition costs, and expenses associated with new lease
investments made since the March 4, 1993 Settlement. Liquidating Limited
Partners do not participate in these post Settlement activities. Significant
factors affecting overall operating results for the three and nine month
periods ended September 30, 1998 as compared to the same periods in 1997
include the following:
Lease income:
Since August 1996, the Partnership has been in its Liquidation Phase which
prohibits investing in any new leases. Accordingly, the lease portfolio has
continued to decrease as collections are made, resulting in a continued decline
in lease income for the three and nine months ended September 30, 1998 as
compared to the corresponding periods in 1997.
Interest income:
Interest income decreased for the three and nine month ended September 30, 1998
as compared to the corresponding periods in 1997 as a result of decreased
invested cash balances.
General Partner's expense reimbursement:
The decrease for the three and nine month periods ended September 30, 1998 is
primarily due to the elimination of premium payments for D&O insurance and
relocation costs as well as reductions in staff and related costs. Through the
first quarter 1997, D&O insurance premiums were paid on an annual basis;
however, in September 1997 a one-time premium was paid that extended coverage
through the ultimate liquidation date of the Partnership. Included in the
second quarter 1997 is a one-time charge for relocating staff to reduced office
space.
Professional fees:
The increase for the nine month period ended September 30, 1998 primarily
reflects fees paid during the second quarter of 1998 in connection with the
trial against one of the Partnership's former accountants. This increase is
partially offset by the decreasing level of professional services required in
such areas as collections, consulting and auditing. These decreases are the
result of the decrease in the Partnership's lease portfolio and related
activities. The decrease for the three months ended September 30, 1998
primarily reflects the reduction in fees paid in connection with the ongoing
litigation. There was little activity while awaiting rulings on post-
15
<PAGE> 16
trial motions filed in July 1998. See Note 4 to the Partnership's financial
statements included in Item 1.
Credit for lease losses:
This credit primarily reflects collections on previously reserved balances.
16
<PAGE> 17
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Reference is made to Item 3 -- Legal Proceedings in the Partnership's December
31, 1997 Form 10-K for a discussion of material legal proceedings involving the
Partnership.
Reference is made to Part I, Item 1, Note 4 for a discussion of legal
proceedings involving claims against Weiss & Co.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS
SEE EXHIBIT INDEX.
(B) REPORTS ON FORM 8-K
None.
17
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized, on the 16th day of November 1998.
DATRONIC EQUIPMENT INCOME FUND XIX, L.P.
Registrant
By: /s/ DONALD D. TORISKY
-----------------------------------------
Donald D. Torisky
Chairman and Chief Executive Officer,
Lease Resolution Corporation
General Partner of
Datronic Equipment Income Fund XIX, L.P.
By: /s/ ROBERT P. SCHAEN
-----------------------------------------
Robert P. Schaen
Vice-Chairman and Chief Financial Officer,
Lease Resolution Corporation
General Partner of
Datronic Equipment Income Fund XIX, L.P.
18
<PAGE> 19
EXHIBIT INDEX
-------------
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<TABLE>
<S> <C>
27 Financial Data Schedule, which is submitted electronically
to the Securities and Exchange Commission for information
only and not filed.
</TABLE>
19
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AND THE STATEMENTS OF REVENUE AND EXPENSES AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH REPORT ON FORM 10-Q
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 2,886,470
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 8,924,713
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 8,669,045
<TOTAL-LIABILITY-AND-EQUITY> 8,924,713
<SALES> 0
<TOTAL-REVENUES> 345,113
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 41,138
<LOSS-PROVISION> (39,496)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,033,702)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
