SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
FIRST AMENDMENT TO CURRENT REPORT ON FORM 8-K
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported):
April 16, 1996
RIDGEWOOD ELECTRIC POWER TRUST IV
(Exact name of registrant as specified in charter)
Delaware 0-25430 22-3324608
(State or other (Commission (IRS Employer
jurisdiction of File No.) Identification No.)
incorporation)
947 Linwood Avenue, Ridgewood, New Jersey 07450-2939
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (201) 447-9000
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(a) FINANCIAL STATEMENTS
INDEX
Page No.
Independent Auditors' Report 1
Balance Sheets as of
December 31, 1995 and 1994 2
Statements of Operations and Joint
Venturers' Capital for the years ended
December 31, 1995 and 1994 3
Statements of Cash Flows
for the years ended
December 31, 1995 and 1994 4
Notes to Financial Statements 5-13
<PAGE>
Topel Forman L.L.C.
CERTIFIED PUBLIC ACCOUNTANTS
Joint Venturers
Northeast Landfill Power Joint Venture
Cohasset, Massachusetts
Independent Auditors' Report
We have audited the accompanying balance sheets of a
NORTHEAST LANDFILL POWER JOINT VENTURE as of December 31, 1995 and
1994, and the related statements of operations and joint venturers'
capital, and cash flows for the years then ended. These financial
statements are the responsibility of the joint venture's management.
Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards 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. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As more fully described in the sales commitment footnote,
the joint venture has excluded from the accompanying financial
statements funds held in escrow and the related royalty expense that
in our opinion, should be included to conform with generally accepted
accounting principles. If these escrow funds were accounted for
properly, other assets would be increased by $1,138,355 ($888,663 in
1994), long-term obligations would be increased by $159,900 ($127,167
in 1994), net income would be increased by $216,959 (net loss
decreased by $190,021 in 1994) and joint venturers' capital would be
increased by $978,455 ($761,496 in 1994)
In our opinion, except for the effects of not recording the funds
held in escrow as described in the preceding paragraph, the financial
statements referred to above present fairly, in all material respects,
the financial position of Northeast Landfill Power Joint Venture as of
December 31, 1995 and 1994, and the results of its operations and its
cash flows for the years then ended in conformity with generally
accepted accounting principles.
Topel Formen, L.L.C.
Certified Public Accountants
Chicago, Illinois One East Erie Street, Chicago, Illinois 60611
February 7, 1996 (312) 642-0006 fax(312) 642-0535
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
ASSETS
CURRENT ASSETS:
1995 1994
Cash $104,386 $373,252
Accounts receivable, trade 802,809 277,356
Accounts receivable,
related parties 180,656 19,219
Investment income receivable 16,422 14,698
Prepaid Expenses 43,405 43,738
Total Current Assets $1,147,678 $ 728,263
MACHINERY AND EQUIPMENT $9,547,867 $9,527,904
Less - accumulated
depreciation 3,684,702 3,050,044
Net Machinery and
Equipment $5,863,165 $6,477,860
OTHER ASSETS $4,221,073 $4,370,014
TOTAL ASSETS $11,231,916 $11,576,137
LIABILITIES AND JOINT VENTURERS' CAPITAL
CURRENT LIABILITIES:
Current maturities of
long-term obligations $ 774,371 $ 705,391
Accounts payable 619,918 299,933
Accrued expenses 184,754 157,685
Notes payable 134,282 134,282
Retainage payable 0 224,700
Total Current
Liabilities $1,713,325 $1,521,991
LONG-TERM OBLIGATIONS, NET OF
CURRENT MATURITIES 8,813,091 9,547,422
JOINT VENTURERS' CAPITAL 705,500 506,724
TOTAL LIABILITIES AND JOINT
VENTURERS' CAPITAL $11,231,916 $11,576,137
(The accompanying notes to financial statements
are an integral part of these statements)
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
STATEMENTS OF OPERATIONS AND JOINT VENTURERS' CAPITAL
YEARS ENDED DECEMBER 31, 1995 AND 1994
1995 1994
NET SALES $4,146,089 $3,896,749
COST OF SALES, INCLUDING
DEPRECIATION EXPENSE
OF $634,658 AND
$634,740, RESPECTIVELY 3,149,506 2,992,115
GROSS PROFIT $ 996,583 $ 904,634
GENERAL AND ADMINI-
STRATIVE EXPENSES 195,972 167,464
INCOME FROM OPERATIONS $800,611 $ 737,170
OTHER INCOME (EXPENSE)
Interest expense ($980,993) ($1,038,158)
Amortization of
other assets (252,987) (253,805)
Sublease income 334,406 292,125
Interest income 50,658 27,918
Other income - net 247,081 146,606
Net Other Expense ($ 601,835) ( $ 825,314)
NET INCOME (LOSS) $ 198,776 ($88,144)
JOINT VENTURERS' CAPITAL,
BEGINNING 506,724 594,868
JOINT VENTURERS' CAPITAL,
ENDING $ 705,500 $ 506,724
(The accompanying notes to financial statements
are an integral part of these statements)
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1995 AND 1994
1995 1994
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 198,776 ($ 88,144)
Adjustments to reconcile
net income (loss) to
net cash provided by
operating activities -
Depreciation and
amortization 887,645 888,380
Earnings on debt service
and maintenance reserves
not received in cash (41,046) ( 8,064)
Settlement of retainage
payable (224,700) 0
Changes in operating
assets and liabilities -
Decrease (increase) in:
Accounts receivable (688,614) 52,024
Prepaid expenses 66,475 67,121
Increase (decrease) in:
Accounts payable 319,985 ( 7,860)
Accrued expenses 27,069 24,125
Net Cash Provided by
Operating Activities $ 545,590 $927,582
CASH FLOWS FROM INVESTING
ACTIVITIES:
Payments for equipment ($ 19,963) ($ 8,169)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Payments on long-term debt ($731,493) ($644,463)
Payments to
maintenance reserve ( 113,000) (250,000)
Proceeds from debt
service reserve 50,000 0
Net Cash Used by
Financing Activities ($ 794,493) ($ 894,463)
INCREASE (DECREASE) IN CASH ($ 268,866) $ 24,950
CASH, BEGINNING 373,252 348,302
CASH, ENDING $ 104,386 $ 373,252
<PAGE>Supplemental Disclosure of Cash Flow Information:
Cash paid during the year
for interest: $ 989,924 $1,014,034
Schedule of Noncash Investing and Financing Activities:
The joint venture financed certain insurance premiums during the years
ended December 31, 1995 and 1994 which resulted in increases in the
following:
Prepaid expenses $ 66,142 $ 66,316
Insurance
financing payable 66,142 66,316
(The accompanying notes to financial statements
are an integral part of these statements)
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
NATURE OF OPERATIONS:
The joint venture is in the business of production of electricity from
landfill gas. The sales of electricity are all made to one customer
and the landfill gas is purchased entirely from a related party (as
described in the related party and sales commitment footnotes.)
ACCOUNTING POLICIES:
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 at 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.
Cash and Cash Equivalents:
The company considers all highly liquid investments with original
maturities of three months or less as cash and cash equivalents.
Machinery and Equipment and Depreciation -
Machinery and equipment, consisting principally of electrical
generating equipment, is stated at cost. Depreciation is provided
using the straight-line method over the estimated useful lives of the
assets.
Other Assets -
Other assets consist primarily of contracts contributed by the joint
venturers, financing fees, organization costs and the right to use
certain equipment owned by the joint venture's sole customer. The
contracts contributed by the joint venturers are stated at the fair
value at the date of contribution whereas other assets are stated at
cost. These assets are being amortized on a straight-line basis over
the following useful lives.
Contracts contributed by joint venturers 20 years
Financing fees related to senior secured
non-recourse notes 13 years
Organization costs 5 years
Rights to use certain equipment 20 years
Income Taxes -
Since income taxes are the responsibility of the joint venturers no
income tax expense or benefit has been recorded in the accompanying
financial statements.
- -6-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
CONCENTRATIONS OF CREDIT RISK:
The joint venture maintains its cash in one bank account, and at
December 31, 1994, the balance in this account was $248,040 in excess
of federally insured limits.
OTHER ASSETS:
Other assets consist of the following at December 31,
1995 1994
Debt service reserve $ 501,533 $ 523,041
Maintenance reserve 375,554 250,000
Contracts contributed by joint
venturers, net of accumulated
amortization of $1,144,718 in
1995 and $952,218 in 1994 2,705,282 2,897,782
Financing fees, net of accumulated
amortization of $168,697 in 1995
and $128,210 in 1994. 357,638 398,125
Rights to use certain equipment,
net of accumulated amortization
of $118,934 in 1995 and
$98,934 in 1994 . 281,066 301,066
Total Other Assets $4,221,073 $4,370,014
NOTES PAYABLE:
Notes payable represent amounts due to related parties. The notes
bear interest at 12% and are subordinated to the borrowings under the
senior secured non-recourse notes. Accrued interest on these notes
amounting to $144,576 and $114,699 at December 31, 1995 and 1994
respectively, is included with accrued expenses in the accompanying
balance sheets.
Payments can be made on these notes provided such payments are not
prohibited by the loan agreement, no default exists under the loan
agreement, or payment would not cause an event of default under the
loan agreement.
LONG-TERM OBLIGATIONS:
Following is a summary of long-term obligations at December 31:
1995 1994
Senior secured non-recourse
notes payable $9,547,422 $10,214,791
Insurance financing 40,040 38,022
$9,587,462 $10,252,813
Less - current maturities 774,371 705,391
Net Long-Term Obligations $8,813,091 $ 9,547,422
- -7-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
LONG-TERM OBLIGATIONS: (Continued)
The senior secured non-recourse notes in the original amount of
$12,000,000 are due in monthly installments of $134,928 including
interest at 9.6%. Final payment is due in October 2004. The notes
also provide for additional interest equal to 5% of the annual net
cash flow of the joint venture, as defined, beginning with the year
ending December 31, 1993 and continuing through the fiscal quarter in
which the notes are repaid in full. No additional interest was due
for the years ending December 31, 1995 and 1994. The notes are
secured by a leasehold mortgage on the joint venture's landfill lease
agreements and substantially all assets of the joint venture. In
addition to the required monthly payments, mandatory prepayments may
be required if certain events occur. The loan agreement also provides
for the initial creation of a debt service reserve of $500,000 and a
maintenance reserve beginning in 1994. Additions to these reserves
are required based on certain conditions as defined in the agreement.
The loan agreement contains various covenants including the
maintenance of a specified debt service ratio.
The insurance financing is due in varying monthly payments including
interest at rates ranging from 7.0% to 8.7% (7.2% to 7.5% in 1994).
Final payment is due at various times through August 1995.
Scheduled repayments of long-term obligations for the next five years
are as follows:
Senior Secured
Year Ended Insurance Non-Recourse
December 31, Financing Notes Payable Total
1996 $ 40,040 $ 734,331 $ 774,371
1997 - 808,014 808,014
1998 - 889,090 889,090
1999 - 978,298 978,298
2000 - 1,076,460 1,076,460
FAIR VALUE OF FINANCIAL INSTRUMENTS:
At December 31, 1995, the carrying amount of the joint venture's cash,
debt service and maintenance reserves and notes payable approximates
their fair value. The fair value of the joint venture's long-term
debt, calculated using current rates for loans with similar
maturities, also approximates its carrying value.
- -8-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
RELATED PARTY TRANSACTIONS:
The joint venture has entered into a Landfill Gas Contract and
Sublease Agreement with Central Gas Limited Partnership (CGLP), an
entity related (as defined in Financial Accounting Standard Board
Statement No. 57) to the joint venture through certain common
ownership, to sublease the landfill. The agreement is effective
through December 31, 2000 and provides for the following:
1. CGLP is to pay an annual sublease to the joint venture in an amount
equal to the product of $30,000 times the assumed output
capacity of each engine generator set in megawatts installed and
operating by the joint venture. Income recorded under this
sublease amounted to $334,406 and $292,125 for the years ended
December 31, 1995 and 1994 respectively. Accounts receivable,
related parties of $180,656 and $19,219 at December 31, 1995 and
1994, respectively represents amounts due the joint venture
under the sublease agreement.
2. The joint venture agreed to purchase all the landfill gas
produced by CGLP. Through December 31, 1990, the joint venture
is to pay on a monthly basis 1 cent per kilowatt hour for the first
4,000,000 hours, 1/2 cent per kilowatt hour for kilowatt hours in
excess of 4,000,000 and 5 cent per million BTU's of excess landfill
gas. The price is adjusted annually after December 31, 1990
based on changes in the Consumer Price Index as defined.
Purchases from CGLP amounted to $677,195 and $647.395 during the
years ended December 31, 1995 and 1994, respectively. Included
in accounts payable at December 31, 1995 and 1994 is $120,820
and $101,889 respectively, related to the landfill gas purchase
agreement.
In addition, the joint venture has entered into management contracts
with its two joint venturers providing for the management of the joint
venture. The management contracts terminate in October of 1999,
however they are automatically renewed for additional terms of 5 years
unless written notice is given. The contracts provide for monthly
fees of $3,000 to each of the joint venturers beginning when power is
first generated by the joint venture. Effective January 1, 1993 and
each year thereafter, the management fees are adjusted based on
changes in the Consumer Price Index, as defined. Effective May 1,
1993, the management agreement was amended to provide for monthly
management fees of $4,884 to each of the joint venturers. All other
terms of the management agreement remain unchanged. Annual payments
under these agreements in excess of specified amounts are not to be
made in the event of a default or if payment would cause an event of
default under the loan agreement. Management fees amounted to
$124,920 and $123,000 for the years ended December 31, 1995 and 1994,
respectively.
-9-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
LEASE COMMITMENTS:
The joint venture leases a landfill which has been subleased to a
related party (see related party note). The lease is for a term of 30
years, from the date gross revenues are first received. The lease can
be extended for an additional 10 years. Under the terms of the lease,
the joint venture is to pay a royalty equal to 15% of net revenues as
defined for the first 15 years. For subsequent years, the royalty is
15% of net revenues for each month in which the average daily kilowatt
hour production is less than 180,000 and 18% of net revenues for each
month in which the average daily kilowatt hour production exceeds
180,000. Expense under this lease agreement amounted to $619,037 and
$580,287 for the years ended December 31, 1995 and 1994, respectively.
SALES COMMITMENT:
The joint venture has entered into a Power Purchase Agreement whereby
the joint venture has committed to sell all of the electricity it
produces to New England Power Company (NEP) for prices as specified in
the agreement which are adjusted annually for changes in the Consumer
Price Index, as defined. The agreement is for a period of 30 years
following commencement of operations but can be terminated under
certain conditions by NEP after 20 years. If the joint venture is in
default under the Power Purchase Agreement, the agreement provides for
damages equal to at least the aggregate differential as defined in the
agreement. The aggregate differential at December 31, 1995 amounts to
approximately $1,417,000 ($2,765,000 at December 31, 1994). To secure
the payment of this amounts, in the event of a default under the
agreement, 5% of the monthly sales are deposited into an escrow
account. Deposits into the escrow account are to continue until the
amounts in escrow exceed amounts specified in the Power Purchase
Agreement. As a result of the joint venture granting a security
interest in the funds held in escrow to NEP, it has not reflected the
amounts held in escrow in the accompanying financial statements and
will record such amounts only as they are released from escrow. Funds
held in escrow at December 31, 1995 and 1994 amounted to $1,138,355 and
$888,663, respectively.
- -10-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
PURCHASE AND OPERATING COMMITMENT:
The joint venture has entered into a Purchase Agreement and Operation
and Maintenance Contract with WPI Packaging and Maintenance Company,
Inc. (WPI). The Purchase Agreement provides for the purchase of
specified equipment at a total cost of $9,221,605. Through December
31, 1994, the joint venture has paid $8,996,905 and recorded retainage
payable for an additional $224,700 related to this contract. This
retainage payable was settled during 1995 (see Arbitration footnote).
The Operations and Maintenance Contract is for an original term
commencing on substantial completion of the Purchase Agreement and
will continue until November 1, 1998. The term is automatically
extended for 1 year periods unless either party gives required notice,
however in no case will the agreement continue past November 1, 2000.
The joint venture will pay for services it receives under the
Operation and Maintenance Contract an amount equal to 1.2 cent per
kilowatt hour of electricity sold to NEP through March 31, 1994.
After this date the price to be paid is adjusted annually, on a
calendar year basis, based on changes in various indexes as specified.
Expense under the Operations and Maintenance Contract amounted to
$982,756 and $940,346 for the years ended December 31, 1995 and 1994,
respectively.
The Operations and Maintenance Contract contains penalty provisions if
the facility is not operated at specified levels. Based upon these
contract provisions, during the years ended December 31, 1995 and 1994
the joint venture assessed penalties of $39,310 and $146,606,
respectively, and reduced its payments due under the Operations and
Maintenance Contract. This amount is included in other income in the
accompanying statements of operations and joint venturers' capital.
ARBITRATION:
Due to operational problems with the joint venture's equipment, the
joint venture previously filed various claims against the equipment's
provider and operator. Under provisions of both the Purchase
Agreement and Operation and Maintenance Contracts, disputes among the
parties shall be settled finally and conclusively by arbitration.
The joint venture has filed claims for refunds of payments made,
future costs which may be incurred to deal with specified
contamination problems and new regulatory requirements, affirmation of
the $565,101 of penalties assessed by the joint venture, lost revenues
and attorneys' fees. In addition, if the facility can not be restored
to its original specified capacity, the joint venture seeks liquidated
damages based on the difference between the specified capacity and
current actual operating capacity. The other party to the arbitration
filed counter claims against the joint venture.
- -11-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
ARBITRATION: (Continued)
During 1994, the arbitration panel issued its rulings with respect to
liability. Its rulings included the following:
1. WPI bears liability and responsibility for the failure of
the catalysts resulting from the presence of organic
silicates in the fuel system.
2. WPI is not liable for performance failures corresponding to
the period from October 1991 to February 1992 and is
entitled to an adjustment in rebate payments on compensation
corresponding to said period.
3. The level of volatile organic compound and sulfur in the
fuel stream have been in excess of contractual limitations
but the panel is unable to conclude from the record
presented that these excesses are at present casually
related to the problem of plant production.
4. Except as otherwise provided above, WPI's remaining
counterclaims are denied.
5. Each party shall pay its own attorneys' fees and costs not
invoiced by the American Arbitration Association, including
the costs associated with the expert witnesses. The costs
and expenses invoiced by the AAA shall be borne eighty
percent by WPI and twenty percent by NLPJV.
The joint venture had previously entered into an agreement whereby
attorneys' fees from the joint ventures lead attorney are deferred and
are subject to a premium of 50%. In addition, the attorneys agreed to
continue to represent the joint venture through the conclusion of
arbitration, as defined, and that payment of the unbilled fees will be
made only when funds are recovered from WPI, its parent company or its
bonding companies.
On January 31, 1995 the arbitrators issued an interim award which
provided for the following:
1. WPI was entitled to an adjustment in rebate payments on
compensation for the period October 1991 to February 1992 in
the amount of $172,880 and recovery of costs associated with
sulfur, excess water and other contaminants in the amount of
$26,767.
2. WPI is to reimburse the joint venture for certain property
additions made by joint venture in the amount of $90,000.
3. The joint venture is to pay interest of approximately
$37,000 on the net of items 1 and 2 from April 1, 1992.
- -12-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
December 31, 1995 AND 1994
ARBITRATION: (Continued)
4. The joint venture is to be reimbursed for attorney fees in
the amount of $465,939. (In addition to these awards, the
arbitrators had previously determined that WPI should
reimburse the joint venture for 80% of the costs of
arbitration including costs not invoiced by the American
Arbitrate Association including the costs associated with
expert witnesses in the amount of approximately $157,000.)
During 1995, the parties to the arbitration entered into an agreement
to finalize their disputes. The significant terms of their agreement
are as follows:
1. WPI will complete the condensate systems.
2. WPI will pay the joint venture the sum of $297,667 which
represents $522,367 of net damages as awarded by the
arbitrators less the retainage payable due to WPI of
$224,700.
3. Both parties agree to waive and release any other prior
claims that each may have against the other with respect to
the disposal of condensate.
4. The joint venture will use reasonable efforts to sell its
power plant by January 31, 1996 on terms acceptable to the
joint venture. If the power plant is sold, the joint venture
will pay WPI the sum of $400,000.
5. Neither party will claim any rebates for the period July 1,
1995 through December 31, 1995 or any increase or decreases
in rebates paid during 1995.
The $522,367 received from WPI, net of related attorney fees of
$390,000 has been included in other income in the accompanying 1995
statement of operations and joint venturers' capital.
OTHER INCOME:
During 1995 as a result of damage to the venture's power plant, the
joint venture received $75,405 in damages. This amount has been
included in other income in the accompanying statement of operations
and joint venturers' capital.
PROPOSED SALE OF ASSETS:
On December 8, 1995, the joint venture entered into a letter agreement
providing for the sales of its assets effective as of December 31,
1995. The agreement provides for the payment of $8,000,000 plus other
amounts as specified in the agreement. In addition, the buyer is to
assume the outstanding balance due under the joint venture's senior
secured non recourse notes payable.
- -13-
<PAGE>
NORTHEAST LANDFILL POWER JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND 1994
PROPOSED SALES OF ASSETS: (Continued)
The purchase price is to be reduced by the amount of any prepayment
penalty, legal fees, filing fees and other costs involved in the
assumption of the notes by the buyer, provided however, that the joint
venture can terminate the transaction is such amounts exceed $400,000.
In addition, the buyer can terminate the transaction if the lender
requires a prepayment in excess of $3,000,000 in order for the buyer
to assume the debt.
The parties to the agreement are currently formalizing an asset
acquisition agreement and the buyer is performing their due diligence.
Finalization of the above agreement is dependent on many factors and
the conclusion of this agreement cannot be assured.
- -14-
<PAGE>
(b) PRO FORMA FINANCIAL INFORMATION
Ridgewood Electric Power Trust IV
Pro Forma Balance Sheet
December 31, 1995
Proforma
Reflecting
Capitalization
of
Actual RPPPLP
Assets:
Investment in power
generation project $ 353,619 $13,203,619
Cash and cash
equivalents 12,998,463 166,010
Interest receivable 59,464 59,464
Electric power equipment 455,182 455,182
Due diligence costs
relating to potential
power project 23,435 5,888
Total assets $ 13,890,163 $13,890,163
Liabilities and Shareholders' Equity:
Accounts payable
and accrued
expenses $ 34,413 $ 34,413
Due to affiliate 353,619 353,619
388,032 388,032
Shareholders' equity:
Shareholders' equity
(162.10 shares issued
issued and out-
standing) $ 13,503,692 $ 13,503,692
Managing share-
holder's accumu-
lated deficit (1,561) (1,561)
Total shareholders'
equity 13,502,131 13,502,131
Total liabilities and
shareholders' equity 13,890,163 $ 13,890,163
See accompanying notes to financial statements.
<PAGE>
Ridgewood Electric Power Trust IV
Notes to Pro Forma Balance Sheet
The preceding pro forma balance sheet presents the
effect of the acquisition of an interest in the Providence
Project and the Trust's related capitalization of a portion
of Ridgewood Providence Power Partners, L.P. as if the
transactions had occurred at December 31, 1995.
Because the Registrant follows generally accepted
accounting principles applicable to business development
companies, the presentation below varies from that often
found for other investment programs. In particular,
investments in Projects are accounted
for as operating activities rather than as investment
activities and are accounted for on the cash basis rather
than on a consolidated basis or equity basis. As a result,
revenues and operating expenses of Projects do not appear on
the Trust's financial statements; rather, the Trust reports
as revenue only amounts distributed to it
from the Projects and reports as expenses only the expenses
incurred in the administration of the Trust. Accordingly,
the transactions described above had no pro forma effect on
the statement of operations of the Trust and no pro forma
income statement is presented here.
(c) Exhibits. Previously supplied.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this First Amendment to Current Report
on Form 8-K, for an event occurring April 16, 1996, to be signed
on its behalf by the undersigned hereunto duly authorized.
RIDGEWOOD ELECTRIC POWER TRUST IV
Date: May 31, 1996 By: /s/ Robert K. Brady
Robert K. Brady, Senior Vice
President and Chief Financial
Officer
