<PAGE> 1
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, 1997 Commission file number 0-20213
----------------- -------
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.)
201 Progress Parkway
Maryland Heights, Missouri 63043
- -------------------------------------------------------------------------------
(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
--- ---
As of March 15, 1998, 90,404 units of limited partnership interest (Units),
representing net assets of $1,485,338 were held by non-affiliates. There is
no established public market for such Units.
<PAGE> 2
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Prospectus of the Registrant dated November 4, 1992, filed
with the Securities and Exchange Commission are incorporated by reference in
Part I, Part II and Part III hereof.
2
<PAGE> 3
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
TABLE OF CONTENTS
<CAPTION>
PART I Page
----
<S> <C>
Item 1. Business 4
Item 2. Properties 6
Item 3. Legal Proceeding 6
Item 4. Submission of Matters to a Vote of Security Holders 6
PART II
Item 5. Market for the Registrant's Common Equity and Related
Stockholder Matters 7
Item 6. Selected Financial Data 8
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Item 8. Index to Financial Statements and Supplementary Financial Data 11
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 27
PART III
Item 10. Directors and Executive Officers of the Registrant 28
Item 11. Executive Compensation 29
Item 12. Security Ownership of Certain Beneficial Owners and
Management 29
Item 13. Certain Relationships and Related Transactions 30
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K 31
SIGNATURES 32
INDEX TO EXHIBITS 33
</TABLE>
3
<PAGE> 4
PART I
Item 1. BUSINESS
Community Investment Partners II, 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, 2007, 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 May 8, 1992, 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 1992. The Partnership sold 111,410 Units of limited
partnership interest and 1,120 units of general partnership interest for an
aggregate price of $1,406,625. After offering expenses, the Partnership
received approximately $1,224,000 in proceeds available for investment. The
Partnership executed a call to each partner requesting the deposit of an
amount equal to the initial capital contribution on August 25, 1994.
The information set forth under the captions "Investment Objectives
& Policies" and "Regulation" in the Prospectus of the Partnership dated
November 4, 1992, 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
investment 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.
4
<PAGE> 5
Other risks include the Partnership's ability to find suitable
investments for its funds because of competition from other entities having
similar investment objectives. Risks may arise due to the significant period
of time that may elapse before the Partnership has completed the selection of
its portfolio company investments and the significant 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. It is unlikely that any significant distributions of the
proceeds from the disposition of investments will be made until the later
years of the term of the Partnership.
Portfolio companies may require additional funds. 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. In addition, they have prior experience in the operation of
Community Investment Partners, L.P., a business development company with a
similar investment strategy.
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 Investments," "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 November 4, 1992,
filed with the Securities and Exchange Commission pursuant to Rule 497(b)
under the Securities Act of 1933 on November 4, 1992, 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
performs management and administrative services for the operation of the
Partnership. The Managing General Partner is paid an annual management fee
of 1.5% of total assets. The Managing General Partner is reimbursed by the
Partnership for out of pocket expenses in connection with finding,
evaluating, structuring, approving, monitoring and liquidating the
Partnership's portfolio investments.
5
<PAGE> 6
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.
6
<PAGE> 7
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, 1998, the total number of
holders of units is 131. The number of limited partnership units
outstanding is 111,395. The number of general partnership units
outstanding is 1,135 as of March 15, 1998.
The information set forth under the captions "Partnership
Distributions and Allocations" and "Transferability of Units" in
the Prospectus of the Partnership dated November 4, 1992, filed
with the Securities and Exchange Commission pursuant to Rule
497(b) under the Securities Act of 1933 is incorporated herein by
reference.
7
<PAGE> 8
Item 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
BALANCE SHEET:
As of
December 31,
--------------------------------------------------------------------------------
1997 1996 1995 1994 1993
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Assets $1,848,895 $1,982,725 $2,014,889 $2,645,511 $1,355,231
Portfolio
Investments at
Fair Value $1,733,229 $1,397,330 $ 545,013 $1,000,013 $ 500,013
<CAPTION>
INCOME STATEMENT:
For the Year Ended
December 31,
------------------------------------------------------------------------------
1997 1996 1995 1994 1993
-------- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C>
Net Income (Loss) $437,384 $(16,866) $(630,622) $(86,345) $(48,394)
before Unrealized
Losses
Unrealized Losses (8,564) (15,298) - - -
Net Income (Loss) 428,820 (32,164) (630,622) (86,345) (48,394)
Per Unit of
Partnership Interest:
Net Asset Value $ 16.43 $ 17.62 $ 17.91 $ 23.50 $ 12.04
Net Income (Loss) 3.89 (.15) (5.60) (.77) (.43)
before Unrealized
Losses
Unrealized Losses (.08) (.14) - - -
Net Income (Loss) 3.81 (.29) (5.60) (.77) (.43)
</TABLE>
8
<PAGE> 9
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
(FISCAL YEAR 1997 VERSUS 1996)
Net income for the year ended December 31, 1997, was $428,820,
compared to a net loss of $32,164 in 1996. The increase in net income is
mainly attributable to realized gains of $511,973 from the sale of 2,000
shares of Class A Cumulative Redeemable Preferred Stock of Houghton
Acquisition Corporation as outlined in Note 6 to the financial statements.
For 1997, there was a net unrealized loss on investments of $8,564 due to the
unrealized loss recorded for FCOA Acquisition Corporation when the share
price decreased. This unrealized loss was offset by unrealized gains
recorded for Computer Motion, Inc., which participated in an initial public
offering during the year. Income also was derived from dividends and
interest. However, dividend and interest income decreased approximately
$48,600, or 58%, from the prior year, due to a smaller amount of cash funds
invested in certificates of deposit and money market funds. The cash was
used to make several investments which are outlined in the Schedule of
Portfolio Investments and the schedule of investment transactions included in
Note 6 to the financial statements. Expenses increased approximately $9,200,
or 9%, from the prior year due to higher legal and trustee fees.
The Partnership made a distribution of $5 per unit during 1997.
As of December 31, 1997, unrealized losses on investments totaled
$23,862. The future income or loss of the Partnership is contingent upon the
performance of the portfolio investments.
(FISCAL YEAR 1996 VERSUS 1995)
Net loss for the year ended December 31, 1996, was $32,164,
compared to a net loss of $630,622 for 1995. Income was derived from
dividend income on portfolio investments and interest income from
certificates of deposit. The majority of the reduced net loss incurred
during 1996 is due primarily to an investment in West End Soda Brew of
$600,000, which was written off in 1995. In addition, the Partnership had
lower interest income of $15,212, due to cash being used to purchase
investments throughout 1996. Dividend income increased $18,979 due to the
increased level of investments. During the year, the Partnership made
several investments as outlined in the Schedule of Portfolio Investments.
One such investment, FCOA Acquisition Corp., participated in an initial
public stock offering on December 13, 1996. The initial public offering
price was $9 per share, and the stock trades on the NASDAQ under the ticker
symbol FCPY. As of December 31, 1996, an unrealized loss of $15,298 has been
recorded for the FCOA Acquisition Corporation investment. Expenses decreased
by $9,989, from $110,490 in 1995 to $100,501 in 1996. The decrease is
primarily related to lower professional fees. The future income or loss of
the Partnership is contingent upon the performance of current and future
investments.
SUBSEQUENT EVENTS
The Partnership received a principal payment of $51,600, due
January 2, 1998, for the 8% Convertible Promissory Note from Hawk
Corporation. This related to the prior sale of the Partnership's investment
in Houghton Acquisition Corporation. In addition, $1,582 was received
9
<PAGE> 10
for interest accrued for the fourth quarter of 1997 on this Note.
LIQUIDITY AND CAPITAL RESOURCES
Total capital for the Partnership as of December 31, 1997, was
$1,848,895. This consisted of $1,830,287 in Limited Partner capital and
$18,608 in General Partner capital.
Net income of $428,820 for 1997 was allocated in the amount of
$424,532 to the Limited Partners and in the amount of $4,288 to the General
Partners.
The Partnership is actively reviewing potential portfolio
investments. Until the Partnership finishes investing in portfolio
investments, it intends to invest its cash balances in a money market
account. At December 31, 1997, $90,000 was invested in the money market
account. Due to their short term nature, such investments provide the
Partnership with the liquidity necessary for investments as opportunities
arise.
10
<PAGE> 11
Item 8. INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
Page
----
<S> <C>
Report of Independent Accountants 12
Balance Sheet as of December 31, 1997 and 1996 13
Schedule of Portfolio Investments as of
December 31, 1997 and 1996. 14
Income Statement for the Years Ended
December 31, 1997, 1996, and 1995. 19
Statement of Changes in Partnership Capital for the
Years Ended December 31, 1997, 1996 and 1995. 20
Statement of Cash Flows for the Years Ended
December 31, 1997, 1996 and 1995. 21
Notes to Financial Statements. 22
</TABLE>
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.
11
<PAGE> 12
REPORT OF INDEPENDENT ACCOUNTANTS
To the Partners of
Community Investment Partners II, L.P.
In our opinion, the financial statements listed in the accompanying index
present fairly, in all material respects, the financial position of Community
Investment Partners II, L.P. (the "Partnership") at December 31, 1997 and
1996, 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, 1997, 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, 1997, provide a reasonable basis for the opinion
expressed above.
As explained in Note 3, the financial statements include securities valued at
$1,382,233 (75 percent of net assets), whose values have been estimated by
the Managing General Partner in the absence of readily ascertainable market
values. Those estimated values may differ significantly from the values that
would have been used had a ready market for the investments existed, and the
differences could be material.
PRICE WATERHOUSE LLP
St. Louis, Missouri
March 9, 1998
12
<PAGE> 13
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
BALANCE SHEET
<CAPTION>
ASSETS
------
December 31,
1997 1996
---------- ----------
<S> <C> <C>
Investments at Fair Value (Note 3)
(cost $1,757,091 and $1,412,628, respectively) $1,733,229 $1,397,330
Cash and Cash Equivalents 112,496 540,528
Deferred Organizational Costs, net (Note 3) - 36,683
Accrued Interest and Dividends Receivable 18,974 17,835
Prepaid Expenses - 2,449
---------- ----------
TOTAL ASSETS $1,864,699 $1,994,825
========== ==========
<CAPTION>
LIABILITIES AND PARTNERSHIP CAPITAL
-----------------------------------
December 31,
1997 1996
---------- ----------
<S> <C> <C>
Liabilities:
Accounts Payable and Accrued Expenses $ 15,804 $ 12,100
---------- ----------
TOTAL LIABILITIES 15,804 12,100
---------- ----------
Partnership Capital:
Capital - Limited Partners 1,830,287 1,962,730
Capital - General Partners 18,608 19,995
---------- ----------
TOTAL PARTNERSHIP CAPITAL 1,848,895 1,982,725
---------- ----------
TOTAL LIABILITIES AND
PARTNERSHIP CAPITAL $1,864,699 $1,994,825
========== ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
13
<PAGE> 14
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
AS OF DECEMBER 31, 1997
<CAPTION>
Company Nature of Business Fair Value
Initial Investment Date Investment Cost (Note 3)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Hawk Corporation Designs, engineers, manufactures,
(Houghton Acquisition and markets friction products and precision
Corporation) engineered components
January 2, 1997 8% Convertible Promissory Note,
due 1/2/99 $ 77,400 $ 77,400
8% Contingent EBITDA Promissory
Note, due 4/30/00 0 0
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, due 6/29/00 45,000 45,000
January 26, 1996 7% Promissory Note, due 1/25/01 67,500 67,500
Computer Motion, Inc. Develops and supplies medical robotics
June 26, 1997 40,948 warrants to purchase
common stock, exercisable
at $4.569 per warrant through
5/2/03 8 8
August 12, 1997 16,208 shares of Common Stock 124,993 170,184
16,209 warrants to purchase
common stock, exercisable
at $7.712 per warrant,
through 12/31/03 250 250
FCOA Acquisition A chain of greeting card/
Corporation party stores which offer
(d/b/a Factory Card a full line of products at
Outlet) everyday value prices
July 30, 1996 26,063 Common Shares 249,865 180,812
The accompanying notes are an integral
part of these financial statements.
14
<PAGE> 15
COMMUNITY INVESTMENT PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS (cont'd.)
AS OF DECEMBER 31, 1997
Company Nature of Business Fair Value
Initial Investment Date Investment Cost (Note 3)
- ------------------------------------------------------------------------------------------------------------------
Permalok Corporation Develops and sells 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
Stereotaxis, Inc. Develops and markets a system
by which surgery can be conducted
remotely using computer
controlled magnets
December 30, 1996 138,889 shares of Preferred Stock 100,000 100,000
November 12, 1997 10% Convertible Promissory 39,609 39,609
Note, due 10/31/02
Medical Device Specializes in the development,
Alliance, Inc, manufacture and marketing of devices
for ultrasound-assisted lipoplasty
January 24, 1997 20,000 shares of Common Stock 100,000 100,000
Online Resources & Provides a variety of inter-
Communications active banking and financial
Corporation services to end-users and
corporate customers in the
banking and financial
services industry
March 17, 1997 1,525 shares of Series C
Convertible Preferred Stock 152,466 152,466
Warrants to purchase
20,327 shares of Common
Stock at $3.00 per warrant,
expiring 6/1/02 0 0
The accompanying notes are an integral
part of these financial statements.
15
<PAGE> 16
COMMUNITY INVESTMENT PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS (cont'd.)
AS OF DECEMBER 31, 1997
Company Nature of Business Fair Value
Initial Investment Date Investment Cost (Note 3)
- ------------------------------------------------------------------------------------------------------------------
Advanced UroScience, Developing Acyst, an injectable
Inc. bulking agent, for the treatment
of stress urinary incontinence.
April 7, 1997 25,000 shares of Series A
Preferred Stock $ 100,000 $ 100,000
Neocrin Company Research and development
of minimally invasive,
encapsulated cellular transplants
for the treatment of diabetes.
September 3, 1997 50,000 shares of Series E
Preferred Stock 100,000 100,000
BioSeparations, Inc. Develops automated
instrumentation that can
isolate and process cells for
use in biotechnology,
diagnostic, therapeutic, and
clinical research applications
October 14, 1997 50,000 shares of Series B
Preferred Stock 100,000 100,000
Warrant to purchase 9,091
shares of Common Stock
at $1.10 per share, through
10/15/02 - -
Warrant to purchase 50,000
shares of Series B Preferred Stock
at $0.20 per share, through 1/31/01 - -
---------- ----------
$1,757,091 $1,733,229
========== ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
16
<PAGE> 17
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS
AS OF DECEMBER 31, 1996
<CAPTION>
Company Nature of Business Fair Value
Initial Investment Date Investment Cost (Note 3)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
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, due 6/29/00 45,000 45,000
January 26, 1996 7% Promissory Note, due 1/25/01 67,500 67,500
Computer Motion, Inc. Develops and supplies
medical robotics
May 3, 1996 Prime +1% Term Note,
due 10/31/98 125,000 125,000
September 9, 1996 25,000 shares of Series E
Preferred Stock 125,000 125,000
25,000 warrants 250 250
FCOA Acquisition A chain of greeting card/
Corporation party stores which offer
(d/b/a Factory Card a full line of products at
Outlet) everyday value prices
July 30, 1996 26,063 Common Shares 249,865 234,567
The accompanying notes are an integral
part of these financial statements.
17
<PAGE> 18
COMMUNITY INVESTMENT PARTNERS II, L.P.
SCHEDULE OF PORTFOLIO INVESTMENTS (cont'd.)
AS OF DECEMBER 31, 1996
Company Nature of Business Fair Value
Initial Investment Date Investment Cost (Note 3)
- ------------------------------------------------------------------------------------------------------------------
Permalok Corporation Develops and sells 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
Stereotaxis, Inc. Develops and markets a system
by which surgery can be conducted
remotely using computer
controlled magnets
December 30, 1996 138,889 shares of Preferred Stock 100,000 100,000
---------- ----------
$1,412,628 $1,397,330
========== ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
18
<PAGE> 19
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
INCOME STATEMENT
<CAPTION>
For the Year Ended
December 31,
1997 1996 1995
-------- -------- ---------
<S> <C> <C> <C>
INCOME
------
Interest and Dividend Income $ 35,075 $ 83,635 $ 79,868
Net Realized Gain (Loss) on Sale of
Investments (Note 6) 511,973 - (600,000)
-------- -------- ---------
TOTAL INCOME (LOSS) 547,048 83,635 (520,132)
-------- -------- ---------
EXPENSES
--------
Management Fees (Note 5) 28,851 30,496 30,918
Amortization of Deferred
Organization Costs (Note 3) 36,683 36,684 36,683
Professional Fees 31,106 19,898 29,540
Independent General Partners' Fees 12,000 12,000 12,000
Other 1,024 1,423 1,349
-------- -------- ---------
TOTAL EXPENSES 109,664 100,501 110,490
-------- -------- ---------
Net Income (Loss) before
Unrealized Losses 437,384 (16,866) (630,622)
Net Unrealized Losses
on Investments (8,564) (15,298) -
-------- -------- ---------
NET INCOME (LOSS) $428,820 $(32,164) $(630,622)
======== ======== =========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
19
<PAGE> 20
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
STATEMENT OF CHANGES IN PARTNERSHIP CAPITAL
<CAPTION>
For the Years Ended December 31, 1997, 1996 and 1995
----------------------------------------------------
Limited General
Partners Partners Total
---------- -------- ----------
<S> <C> <C> <C>
Balance, December 31, 1994 $2,618,888 $26,623 $2,645,511
Net loss (624,316) (6,306) (630,622)
---------- ------- ----------
Balance, December 31, 1995 $1,994,572 $20,317 $2,014,889
Net loss (31,842) (322) (32,164)
---------- ------- ----------
Balance, December 31, 1996 $1,962,730 $19,995 $1,982,725
Distribution (556,975) (5,675) (562,650)
Net Income 424,532 4,288 428,820
---------- ------- ----------
Balance, December 31, 1997 $1,830,287 $18,608 $1,848,895
========== ======= ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
20
<PAGE> 21
<TABLE>
COMMUNITY INVESTMENT PARTNERS II, L.P.
STATEMENT OF CASH FLOWS
<CAPTION>
For the Year Ended December 31,
1997 1996 1995
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CASH FLOWS PROVIDED (USED) FOR
OPERATING ACTIVITIES:
Net Income (Loss) $ 428,820 $ (32,164) $ (630,622)
Adjustments to Reconcile
Net Income (Loss) to Net Cash
Provided by Operating
Activities:
Amortization of Deferred
Organization Costs 36,683 36,683 36,683
Purchase of Portfolio Investments (592,083) (867,615) (145,000)
Net Realized (Gain) Loss on Sale/ -
Liquidation of Portfolio Investment (511,973) - 600,000
Unrealized Losses on
Portfolio Investments 8,564 15,298 -
Increase in Accrued Interest Receivable (1,139) (8,251) (2,206)
Increase in Accounts
Payable and Accrued Expenses 3,704 - 7,000
Decrease (Increase) in Prepaid Expense 2,449 (2,449) -
Sale of Portfolio Investments 759,593 - -
--------- ---------- ----------
Total Cash Provided (Used) for Operating
Activities 134,618 (858,498) (134,145)
CASH FLOWS USED BY
FINANCING ACTIVITIES:
Capital Distributions (562,650) - -
--------- ---------- ----------
Total Cash Used by
Financing Activities (562,650) - -
--------- ---------- ----------
Net Decrease in
Cash and Cash Equivalents (428,032) (858,498) (134,145)
CASH AND CASH EQUIVALENTS:
Beginning of year 540,528 1,399,026 1,533,171
--------- ---------- ----------
End of year $ 112,496 $ 540,528 $1,399,026
========= ========== ==========
The accompanying notes are an integral
part of these financial statements.
</TABLE>
21
<PAGE> 22
COMMUNITY INVESTMENT PARTNERS II, L.P.
NOTES TO FINANCIAL STATEMENTS
1. GENERAL
Partnership Organization
------------------------
Community Investment Partners II, L.P. (the "Partnership") was formed on
May 8, 1992, 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 will 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, 2007, subject
to the right of the Individual General Partners to extend the term for
up to two additional two-year periods.
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 investment 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
Generally, profits will be allocated 99% to the Limited Partners and 1%
to the General Partners until the Partners' Capital Accounts equal
their undistributed Capital Contributions. Thereafter, profits will
be allocated 90% to the Limited Partners and 10% to the General
Partners in an amount sufficient to cause their Capital Accounts to
equal an amount equal to (i) two times their Capital Contributions
less (ii) cumulative distributions pursuant to paragraph 4.1 and
paragraph 9.2.2 of the Partnership Agreement, at which time profits
will be allocated 80% to the Limited Partners and 20% to the General
Partners.
22
<PAGE> 23
Generally, losses will be allocated 99% to the Limited Partners and 1%
to the General Partners; provided, however, that losses will be
allocated 80% to the Limited Partners and 20% to the General Partners
to the extent of any prior allocation of profits which were made to
the Partners on an 80%/20% basis. Next, losses will be allocated 90%
to the Limited Partners and 10% to the General Partners to the extent
any prior allocations of profits were made to the Partners on an
90%/10% basis. Thereafter, losses, if any, will be allocated to those
Partners who bear the economic risk of loss.
Partners should refer to the partnership agreement for more specific
information.
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 investments existed, and the differences could be
material to the financial statements. Investment 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.
Organizational Costs
--------------------
Organizational costs were amortized over a sixty-month period. As of
December 31, 1997, the organizational costs were fully amortized.
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.
23
<PAGE> 24
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.
4. PER UNIT INFORMATION
There is no market for the Limited Partnership interests. Per Unit
Information is as follows:
<TABLE>
<CAPTION>
For the Year Ended December 31,
1997 1996 1995
- ------------------------------------------------------------------------------------
<S> <C> <C> <C>
Number of unit holders 131 131 131
Limited partnership units 111,395 111,395 111,395
General partnership units 1,135 1,135 1,135
-------- -------- --------
Total units outstanding 112,530 112,530 112,530
======== ======== ========
Net asset value per unit $ 16.43 $ 17.62 $ 17.91
======== ======== ========
Net income (loss) per unit $ 3.81 $ (.29) $ (5.60)
======== ======== ========
</TABLE>
24
<PAGE> 25
5. RELATED PARTY TRANSACTIONS
The Partnership is furnished with certain non-reimbursed management and
accounting services by affiliates, whose value is not reflected in the
accompanying financial statements.
The Managing General Partner performs management and administrative
services for the operation of the Partnership. The Managing General
Partner is paid an annual management fee of 1.5% of total assets.
This fee for 1997 was $28,851.
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,
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.
25
<PAGE> 26
6. INVESTMENT TRANSACTIONS
Following is a summary of portfolio investment transactions during the
years ended December 31, 1997, 1996, and 1995 respectively.
<TABLE>
<CAPTION>
For the year ended December 31, 1997:
- -------------------------------------
Type of Realized
Company Investment Cost Proceeds Gain (Loss)
------- ---------- ---- -------- -----------
<S> <C> <C> <C> <C>
Purchases:
---------
Medical Device
Alliance, Inc. Common Stock $100,000
Online Resources &
Communications Promissory Note
Corporation & Warrants 152,466
Series A
Advanced UroScience, Inc. Preferred Stock 100,000
Computer Motion, Inc. Warrants 8
Series E
Neocrin Company Preferred Stock 100,000
BioSeparations, Inc. Series B
Preferred Stock
& Warrants 100,000
Stereotaxis, Inc. Convertible
Promissory Note 39,609
--------
Total Purchases $592,083
========
Sales:
-----
Class A Cumulative
Houghton Redeemable Preferred
Acquisition Corp. Stock $200,013 $711,986<Fa> $511,973
Computer Motion, Inc. Term Note 125,000 125,000 -
Computer Motion, Inc. Fractional Shares
Common Stock 7 7 -
-------- -------- --------
Total Sales $325,020 $836,993 $511,973
======== ======== ========
26
<PAGE> 27
<FN>
<Fa> Proceeds included $634,586 in cash and a $77,400 8% Convertible
Promissory Note due 1/2/99. A $25,800 Promissory Note contingent upon the
future income of HAC before interest, taxes, depreciation, amortization and
corporate charges was also received as consideration. Due to the contingent
nature of the $25,800 Promissory Note, a gain has not been recorded. This
note has been recorded at an original cost of $0, and additional gain will be
recorded if, or when, payments become due under terms of the Note.
<CAPTION>
For the year ended December 31, 1996:
- -------------------------------------
Type of Realized
Company Investment Cost Proceeds Gain (Loss)
------- ---------- ---- -------- -----------
<S> <C> <C> <C> <C>
Purchases:
---------
Global Surgical Promissory Note $ 67,500
Corporation
Computer Motion, Inc. Term Note,
Preferred Stock
& Warrants 250,250
Factory Card Outlet Common Stock 249,865
Convertible
Permalok Corporation Preferred Stock 200,000
Stereotaxis, Inc. Preferred Stock 100,000
--------
Total Purchases $867,615
========
For the year ended December 31, 1995:
- -------------------------------------
Type of Realized
Company Investment Cost Proceeds Gain (Loss)
------- ---------- ---- -------- -----------
<S> <C> <C> <C> <C>
Purchases:
---------
West End Soda Brew, LP Limited
Partnership
Interest $100,000
Global Surgical Promissory Note 45,000
Corporation
--------
Total Purchases $145,000
========
</TABLE>
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURES
None
27
<PAGE> 28
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 operation of the Partnership and perform the various
duties imposed on the directors of a business development company by the
Investment Company Act of 1940. 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., 52, has been an Independent General Partner
of the Partnership since May 1992. He is also an independent general partner
of Community Investment Partners, 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 2,026 Units.
E. Stanley Kroenke, 50, has served as an Independent General
Partner of the Partnership since May 1992. He is also an independent general
partner of Community Investment Partners, 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 as well as apartment projects around the country.
Mr. Kroenke is co-owner and vice chairman of the St. Louis Rams National
Football League franchise. He also serves as a member of the board of
directors of Wal-Mart Stores, Inc., Bentonville, Arkansas; Central
Bancompany, Jefferson City, Missouri; Boone County National Bank, Columbia,
Missouri; and the Strategic Development Board of the University of Missouri
School of Business, Columbia, Missouri. He serves as a trustee of the
College of the Ozarks in Point Lookout, Missouri, as well as chairman of
their real estate committee. Mr. Kroenke owns 5,633 Units.
CIP Management, L.P., LLLP (the "Managing General Partner") is the
Managing General Partner of Community Investment Partners II, L.P. The
Managing General Partner is also managing general partner of Community
Investment Partners, L.P. and Community Investment Partners III L.P., LLLP,
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.
28
<PAGE> 29
The Directors and Officers of CIP Management, Inc. are as follows:
Daniel A. Burkhardt, 50, 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.P., LLP, 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 Essex County Gas Company,
St. Joseph Light & Power Co., SEMCO Energy, Inc. and Mid-America Realty
Investment, Inc. Mr. Burkhardt is the beneficial owner of 4,052 Units.
Ray A. Robbins, Jr., 53, Vice President and Director of CIP
Management, Inc. since October 1989. He is a general partner of The Jones
Financial Companies, L.P., LLP, 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 a beneficial owner of 3,242 Units.
Marilyn A. Gaffney, 39, Secretary of CIP Management, Inc. since
October 1989. She is a Limited Partner of The Jones Financial Companies,
L.P., LLP, 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 405 Units.
Item 11. EXECUTIVE COMPENSATION
The information set forth under the caption "Partnership
Distributions and Allocations" in the Prospectus of the Partnership dated
November 4, 1992, 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
Independent General Partners and the Officers and Directors of CIP
Managements, Inc., described in Item 10, is herein incorporated by reference.
29
<PAGE> 30
As of March 15, 1998, 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>
Richard P. Kiphart 10,131 9.09%
EDJ Ventures Ltd. 5,633 5.06%
E. Stanley Kroenke 5,633 5.06%
</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.
30
<PAGE> 31
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 November 4, 1992.
(4) Form of Unit Certificate.<F*>
(10) Management Agreement dated November 4, 1992, between the
Partnership and CIP Management, L.P., LLLP.<F**>
(28) Prospectus of the Partnership dated November 4, 1992,
filed with the Securities and Exchange Commission in
connection with Registration Statement No. 33-47917 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 November 4, 1992 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
Registration Statement No. 33-47917 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, 1997.
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.
31
<PAGE> 32
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 23rd day
of March, 1998.
Community Investment Partners II, 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.
<TABLE>
<C> <S>
/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 II, L.P.
/s/ E. Stanley Kroenke
- ------------------------------ Individual General Partner,
E. Stanley Kroenke Community Investment Partners II, L.P.
</TABLE>
32
<PAGE> 33
<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 November 4, 1992 <F*>
(4) Form of Unit Certificate <F*>
(10) Management Agreement dated November 4, 1992,
between the Partnership and CIP Management,
L.P., LLLP <F*>
(28) Prospectus of the Partnership dated November 4,
1992, filed with the Securities and Exchange
Commission in connection with Registration
Statement No. 33-47917 on Form N-2 under the
Securities Act of 1933 <F*>
<FN>
- --------------------
<F*>Incorporated by reference
</TABLE>
33
<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 year ended December 31, 1997 and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 1,757,091
<INVESTMENTS-AT-VALUE> 1,733,229
<RECEIVABLES> 18,974
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,864,699
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 15,804
<TOTAL-LIABILITIES> 15,804
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 112,530
<SHARES-COMMON-PRIOR> 112,530
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,848,895
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 35,075
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 511,973
<APPREC-INCREASE-CURRENT> (8,564)
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> (562,650)
<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> 109,664
<AVERAGE-NET-ASSETS> 1,915,810
<PER-SHARE-NAV-BEGIN> 17.62
<PER-SHARE-NII> 3.81
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (5.00)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 16.43
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
