<PAGE>
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, 1996
Commission file number 33-47917
COMMUNITY INVESTMENT PARTNERS II, L.P.
______________________________________________________________________
(Exact name of registrant as specified in its charter)
MISSOURI 43-1609351
______________________________________________________________________
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
12555 Manchester
St. Louis, Missouri 63131
______________________________________________________________________
(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.
(1) YES X NO (2) YES NO X
____ ____ ____ ____
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COMMUNITY INVESTMENT PARTNERS II, L.P.
INDEX
Page
Number
Part I.FINANCIAL INFORMATION
Item 1.Financial Statements
Balance Sheet ...........................................3
Schedule of Portfolio Investments .......................4
Income Statement ........................................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 *
Item 1.Legal Proceedings.......................................10
Item 6.Exhibits and Reports on Form 8-K........................10
Signatures ..............................................11
* Items 3,4 and 5 are omitted as they are not applicable
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COMMUNITY INVESTMENT PARTNERS II, L.P.
BALANCE SHEET
(Unaudited)
September 30, December 31,
1996 1995
ASSETS
Cash and cash equivalents $656,379 $1,399,026
Investments (at fair market value,
cost $1,312,628 and $545,013,
respectively) 1,312,628 545,013
Deferred organizational costs, net 45,854 73,366
Accrued interest receivable 10,770 9,584
______________ _____________
Total Assets $2,025,631 $2,026,989
=============== =============
LIABILITIES AND PARTNERSHIP CAPITAL
Liabilities:
Accrued expenses $22,784 $12,100
_____________ _____________
Total Liabilities 22,784 12,100
_____________ _____________
Partnership Capital:
Capital - Limited Partners 1,982,652 1,994,572
Capital - General Partners 20,195 20,317
_____________ _____________
Total Partnership Capital 2,002,847 2,014,889
_____________ _____________
Total Liabilities and Partnership
Capital $ 2,025,631 $2,026,989
=========== ===========
The accompanying notes are an integral part of these financial
statements.
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COMMUNITY INVESTMENT PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
AS OF SEPTEMBER 30, 1996
Company/ Nature of Business/ Fair Market
Initial Investment Date Investment Cost Value
Houghton Acquisition Organized for the purpose of
Corporation acquiring Hutchinson Foundry
Products Inc.
March 10, 1993 2,000 shares of Class A
cumulative redeemable
Preferred Stock $200,013 $200,013
Global Surgical Formed to acquire the Urban
Corporation Microscope Division and the
Surgical Mechanical Research
subsidiary of Storz Medical
January 31, 1994 3,000 shares of Common
Stock 300,000 300,000
June 30, 1995 7% Promissory Note 45,000 45,000
January 26, 1996 7% Promissory Note 67,500 67,500
Computer Motion, Inc. The leading developer and
supplier of medical robotics
May 3, 1996 Prime +1% Term Note 125,000 125,000
September 9, 1996 25,000 shares of Series E
Preferred Stock 125,250 125,250
FCOA Acquisition Corp. A chain of greeting card/
(d/b/a Factory Card party stores which offer
Outlet) a full line of products at
discount prices
July 30, 1996 649 shares of Series C
Preferred Stock 249,865 249,865
Permalok Corporation Develops and sells an
innovative steel pipe
joining system to the
domestic underground
utility construction
industry
September 24, 1996 25,000 shares of
Convertible Preferred
Stock 200,000 200,000
__________ __________
$1,312,628 $1,312,628
========== =========
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COMMUNITY INVESTMENT PARTNERS II, L.P.
INCOME STATEMENT
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
INCOME
Interest income $ 12,404 $ 5,871 $ 39,518 $ 41,349
Dividend income 7,620 7,453 16,559 14,818
_________ _________ _________ _________
Total Income 20,024 13,325 56,077 56,166
_________ _________ _________ _________
EXPENSES
Legal fees 2,449 2,920 7,236 8,415
Management fees 7,593 9,956 22,784 29,729
Amortization of deferred
organizational costs 9,171 9,171 27,512 27,512
Independent general partners'
fees 3,000 3,000 9,000 9,000
Professional fees - - - 7,000
Miscellaneous expense 515 569 1,587 1,220
_________ _________ _________ _________
Total Expenses 22,728 25,617 68,119 82,886
_________ _________ _________ _________
Net loss $ (2,704) $(12,292) $(12,042) $(26,720)
======== ======== ======== ========
Per unit of Partnership interest:
Net Loss $ (.02) $ (.11) $ (.11) $ (.24)
======== ======== ======== ========
Net asset value
(9/96 and 12/95) $ 17.80 $ 17.91
======== =========
Units Outstanding:
Limited Partners 111,410
General Partners 1,120
The accompanying notes are an integral part of these financial
statements.
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COMMUNITY INVESTMENT PARTNERS II, L.P.
STATEMENT OF CASH FLOWS
(Unaudited)
Nine Months Nine Months
Ended Ended
September 30, September 30,
1996 1995
CASH FLOWS (USED) BY OPERATING
ACTIVITIES:
Net loss $ (12,042) $ (26,720)
Adjustments to reconcile net income to net
cash provided by operating activities -
Purchase of portfolio investments (767,615) (145,000)
Amortization of deferred organization
costs 27,512 27,512
Increase in accrued interest receivable (1,186) (165)
Increase in accrued expenses 10,684 27,639
_____________ _____________
Total cash used by
operating activities (742,647) (116,734)
_____________ _____________
Net (decrease) in cash (742,647) (116,734)
CASH AND EQUIVALENTS, beginning of year 1,399,026 1,533,171
_____________ _____________
CASH AND EQUIVALENTS, end of year $ 656,379 $ 1,416,437
============= =============
The accompanying notes are an integral part of these financial
statements.
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COMMUNITY INVESTMENT PARTNERS II, L.P.
STATEMENT OF CHANGES IN PARTNERSHIP CAPITAL
(Unaudited)
Nine Months Ended September 30, 1996 and 1995
Limited General
Partners Partners Totals
Balance December 31, 1994 $ 2,618,888 $26,623 $2,645,511
Net income (loss) (26,452) (268) (26,720)
__________ ________ __________
Balance September 30, 1995 $ 2,592,436 $ 26,355 $2,618,791
Balance, December 31, 1995 $ 1,994,572 $20,317 $ 2,014,889
Net income (loss) (11,920) (122) (12,042)
__________ _________ ___________
Balance September 30, 1996 $ 1,982,652 $20,195 $ 2,002,847
The accompanying notes are an integral part of these financial
statements.
<PAGE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
BASIS OF PRESENTATION
Community Investment Partners II, L.P. (CIP II) 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. (Management), a limited
partnership, is the Managing General Partner of CIP II. Management is
responsible for making all decisions regarding CIP II's investment
portfolio and is not engaged in any other activities. CIP II pays CIP
Management, L.P. a management fee based on 1 1/2% of CIP II's total
assets.
CIP II was formed May 8, 1992. The Partnership raised $1,406,625
through a public offering of its units during December, 1992. The
Partnership executed a call to each partner requesting the deposit of
an amount equal to the initial capital contribution on August 25,
1994.
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. 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. Currently,
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market value approximates cost for the investments of CIP II.
<PAGE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
MANAGEMENT'S FINANCIAL DISCUSSION
RESULTS OF OPERATIONS
Losses for the three months ended September 30, 1996 and 1995 were
$2,704 and $12,292, respectively. Losses for the nine months ended
September 30, 1996 and 1995, were $12,042 and $26,720, respectively.
Interest income was derived from interest on investments and cash
balances. Expenses incurred were related to amortization of deferred
organization costs, independent general partners' fees, management
fees and legal fees.
CASH FLOWS
Cash flows used for the nine months ended September 30, 1996,
resulted primarily from a net operating loss and the purchase of
portfolio investments.
FINANCIAL CONDITION
As of September 30, 1996, CIP II held $1,312,628 in investments
recorded at historical cost.
CIP II owns 2,000 shares of preferred stock in Houghton
Acquisition. Houghton Acquisition was organized for the purpose of
acquiring Hutchinson Foundry Products, Inc.
CIP II holds 3,000 shares of common stock and two 7% notes in
Global Surgical Corporation. Global Surgical Corporation was formed
to acquire the Urban Microscope division and the Surgical mechanical
Research, subsidiary of Storz Medical.
CIP II owns a senior note and 25,000 shares of preferred stock in
Computer Motion, Inc. Computer Motion, Inc. is the leading developer
and supplier of medical robotics.
CIP II owns 649 shares of preferred stock in FCOA Acquisition Corp.
FCOA Acquisition Corp. is a chain of greeting-card/party stores which
offers a full line of products at discount prices.
<PAGE>
CIP II owns 25,000 shares of preferred stock in Permalok
Corporation.
LIQUIDITY AND CAPITAL RESOURCES
The partnership's total capital of $2,002,847 as of September 30,
1996, consisted of $1,982,652 in limited partner capital and $20,195
in general partner capital. Net loss was allocated to the limited
partners in the amount of $11,920 and to the general partners in the
amount of $122.
The partnership intends to invest its cash balances in U.S.
Government securities, investment grade state and municipal bonds,
certificates of deposit at banks with at least $25 million in assets,
or investment grade money market securities sold by banks. At
September 30, 1996, $646,750 has been invested in money market
securities.
<PAGE>
SUBSEQUENT EVENTS
None.
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COMMUNITY INVESTMENT PARTNERS II, 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, 1996.
<PAGE> 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 II, L.P.
By: CIP Management, L.P., Managing General Partner
By: CIP Management, inc., Its Managing General Partner
/s/Daniel A. Burkhardt President, Treasurer
_______________________ and Director
Daniel A. Burkhardt November 7, 1996
/s/Ray L. Robbins Vice-President
_______________________ and Director November 7, 1996
Ray L. Robbins
<PAGE>
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 II, L.P.
By: CIP Management, L.P., Managing General Partner
By: CIP Management, inc., Its Managing General Partner
President, Treasurer
_______________________ and Director
Daniel A. Burkhardt November 7, 1996
Vice-President
_______________________ and Director November 7, 1996
Ray L. Robbins
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<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements for Community Investment Partners II, L.P. for the
quarter ended September 30, 1996 and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
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<NAME> COMMUNITY INVESTMENT PARTNERS II, L.P.
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