1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Period Ended March 31, 2001
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Transition Period From to
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Commission File Number 33-89506
BERTHEL GROWTH & INCOME TRUST I
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(Exact name of Registrant as specified in its charter)
DELAWARE 52-1915821
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
701 Tama Street, Marion, Iowa 52302
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(Address of principal executive offices) (Zip Code)
(319) 447-5700
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Registrant's telephone number, including area code
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
----- -----
Applicable Only to Corporate Issuers
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Shares of Beneficial Interest - 10,541 shares as of April 25, 2001
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BERTHEL GROWTH & INCOME TRUST I
INDEX
PART I. FINANCIAL INFORMATION PAGE
- ------- --------------------- ----
Item 1. Financial Statements (unaudited)
Consolidated Statements of Assets and Liabilities -
March 31, 2001 and December 31, 2000 3
Consolidated Statements of Operations -
three months ended March 31, 2001 and March 31, 2000 4
Consolidated Statements of Changes in Net Assets -
three months ended March 31, 2001 and March 31, 2000 5
Consolidated Statements of Cash Flows -
three months ended March 31, 2001 and March 31, 2000 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 11
Item 3. Quantitative and Qualitative Disclosures About Market Risk 14
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 14
SIGNATURES 15
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BERTHEL GROWTH & INCOME TRUST I
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
March 31, 2001 December 31, 2000
-------------- -----------------
ASSETS
Loans and investments (Note B) .................. $ 12,958,776 $ 12,559,951
Cash and cash equivalents ....................... 254,502 684,244
Interest and dividends receivable, net of reserve
of $48,868 at March 31, 2001 and
December 31, 2000 .......................... 113,172 156,119
Deferred financing costs ........................ 272,564 284,780
Other receivables, net of reserve of $922 at
March 31, 2001 and $0 at December 31, 2000 . 4,378 7,290
------------ ------------
TOTAL ASSETS .................................... 13,603,392 13,692,384
------------ ------------
LIABILITIES
Accrued interest payable ........................ 61,401 257,385
Accounts payable and other accrued expenses ..... 50,854 39,207
Due to affiliate ................................ 94,305 105,024
Deferred income ................................. 27,619 29,647
Distributions payable to shareholders ........... 2,503,191 2,295,259
Debentures (Note C) ............................. 9,500,000 9,500,000
------------ ------------
TOTAL LIABILITIES ............................... 12,237,370 12,226,522
------------ ------------
COMMITMENTS AND CONTINGENCIES
NET ASSETS (equivalent to $129.59 per share
at March 31, 2001 and $139.06 per share
at December 31, 2000) ...................... $ 1,366,022 $ 1,465,862
============ ============
Net assets consist of:
Shares of beneficial interest (25,000 shares
authorized; 10,541 shares issued
and outstanding) ........................... $ 4,542,281 $ 4,818,783
Accumulated net realized losses ................. (1,930,000) (1,930,000)
Accumulated net unrealized losses ............... (1,246,259) (1,422,921)
------------ ------------
$ 1,366,022 $ 1,465,862
============ ============
See notes to consolidated financial statements.
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BERTHEL GROWTH & INCOME TRUST I
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended
March 31, 2001 March 31, 2000
-------------- --------------
REVENUES:
Interest income ......................... $ 230,777 $ 176,348
Dividend income ......................... 34,667 76,356
Application, closing, and other fees .... 2,777 1,687
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Total revenues ............................... 268,221 254,391
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EXPENSES:
Management fees ......................... 82,452 73,675
Administrative services ................. 9,600 9,600
Trustee fees ............................ 8,000 8,000
Professional fees ....................... 18,180 17,980
Interest expense ........................ 201,418 129,710
Other general and administrative expenses 17,141 20,959
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Total expenses ............................... 336,791 259,924
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Net investment loss .......................... (68,570) (5,533)
Unrealized gain on investments ............... 176,662 297,750
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Net increase in net assets ................... $ 108,092 $ 292,217
========= =========
Per beneficial share amounts:
Net increase in net assets ................... $ 10.25 $ 27.72
========= =========
Weighted average shares ...................... 10,541 10,541
========= =========
See notes to consolidated financial statements.
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BERTHEL GROWTH & INCOME TRUST I
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
Three Months Ended Three Months Ended
March 31, 2001 March 31, 2000
-------------- --------------
Shares of Shares of
Beneficial Beneficial
Interest Amount Interest Amount
----------- ----------- ----------- -----------
Net investment loss ................. --- $ (68,570) --- $ (5,533)
Unrealized gain on investments ...... --- 176,662 --- 297,750
Distributions payable to shareholders --- (207,932) --- (210,241)
Net assets at beginning of period ... 10,541 1,465,862 10,541 6,084,733
----------- ----------- ----------- -----------
Net assets at end of period ......... 10,541 $ 1,366,022 10,541 $ 6,166,709
=========== =========== =========== ===========
See notes to consolidated financial statements.
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BERTHEL GROWTH & INCOME TRUST I
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three Months Ended
March 31, 2001 March 31, 2000
-------------- --------------
OPERATING ACTIVITIES:
Net increase in net assets ........................ $ 108,092 $ 292,217
Adjustments to reconcile net increase in net assets
to net cash flows from operating activities:
Amortization ...................................... 11,134 9,498
Accretion of discount on debt securities .......... (22,163) -0-
Unrealized gain on investments .................... (176,662) (297,750)
Provision for possible losses ..................... 922 -0-
Changes in operating assets and liabilities
Loans and investments ........................ (200,000) (2,992,308)
Interest and dividends receivable ............ 42,947 (16,802)
Due from affiliate ........................... -0- (1,406)
Deferred financing costs ..................... 1,082 -0-
Other receivables ............................ 1,990 2,626
Other assets ................................. -0- (10,818)
Accrued interest payable ..................... (195,984) (61,375)
Accounts payable and other accrued expenses .. 11,647 (3,896)
Due to affiliate ............................. (10,719) 1,761
Deferred income .............................. (2,028) 24,063
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Net cash flows from operating activities .......... (429,742) (3,054,190)
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FINANCING ACTIVITIES:
Deferred financing costs incurred ................. -0- (56,250)
Proceeds from issuance of debentures .............. -0- 2,250,000
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Net cash flows from financing activities .......... -0- 2,193,750
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NET DECREASE IN CASH .............................. (429,742) (860,440)
CASH AT BEGINNING OF PERIOD ....................... 684,244 1,137,535
----------- -----------
CASH AT END OF PERIOD ............................. $ 254,502 $ 277,095
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest ............................ $ 397,402 $ 191,085
Noncash financing activities:
Distributions payable to shareholders ............. 207,932 210,241
See notes to consolidated financial statements.
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BERTHEL GROWTH & INCOME TRUST I
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all information
and footnotes required by generally accepted accounting principles for complete
financial statements and should be read in conjunction with the Trust's Form
10-K filed with the Securities and Exchange Commission for the year ended
December 31, 2000. In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair representation have
been included. Operating results for the three months ended March 31, 2001 are
not necessarily indicative of the results that may be expected for the year
ended December 31, 2001.
The preparation of the Trust's financial statements in conformity with
accounting principles generally accepted in the United States of America
necessarily 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 financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
Deferred financing costs consist of a 1% Small Business Administration ("SBA")
commitment fee, which is amortized over the commitment period using the
straight-line method, and a 2.5% SBA leverage and underwriting fee, which is
amortized over the life of the loan using the straight-line method. The
straight-line method approximates the interest method and the relating
amortization is reported as amortization expense.
Certain amounts in the 2000 financial statements have been reclassified to
conform with the 2001 financial statement presentation.
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NOTE B -LOANS AND INVESTMENTS
MARCH 31, 2001 DECEMBER 31, 2000
------------------------ ------------------------
COST VALUATION COST VALUATION
---- --------- ---- ---------
COMMUNICATIONS AND SOFTWARE:
MCLEODUSA, INC .............................................................
38,877 shares of common stock ........................................... $ 610,000 $ 285,422 $ 610,000 $ 444,494
OBJECT SPACE, INC ..........................................................
108,108 shares of Series B convertible preferred stock .................. 404,800 --- 404,800 200,000
EDMIN.COM, INC .............................................................
200,000 shares of 9%, Series A cumulative convertible preferred stock and
warrants to purchase 20,000 shares of common stock at $4.00 per share . 728,000 1,295,000 728,000 728,000
CHEQUEMATE INTERNATIONAL, INC ..............................................
371,823 shares of common stock .......................................... --- 59,492 --- 92,956
8% convertible note receivable due April, 2002 .......................... --- 189,929 --- 181,403
Warrants to purchase 416,441 shares of common stock at $1.00 per share .. --- --- --- ---
CADAPULT GRAPHIC SYSTEMS, INC ..............................................
100,000 shares of 11.5%, Series A convertible preferred stock, options to
purchase 5,000 shares of common stock at $2.19 per share, and warrants
to purchase 333,000 shares of common stock at $3.125 to $4.50 per share 930,000 930,000 930,000 930,000
IBEAM BROADCASTING CORPORATION
545,442 shares of common stock .......................................... 486,372 413,634 486,372 577,259
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TOTAL COMMUNICATIONS AND SOFTWARE (24.5% and 25.1% of total loans and
investments as of March 31, 2001 and December 31,2000, respectively) .... 3,173,477 3,154,112
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HEALTHCARE PRODUCTS AND SERVICES:
PHYSICIANS TOTAL CARE, INC .................................................
10% promissory note due September, 2004 and warrants to purchase
350,000 shares of common stock for at $.035-5.00 per share ............ 807,795 400,000 807,795 400,000
700 shares of common stock .............................................. 4,000 --- 4,000 ---
Options to purchase 5,000 shares of common stock at $4.00 per share ..... --- --- --- ---
INTER-MED, INC .............................................................
1,743.248 shares of common stock ........................................ 650,000 650,000 650,000 650,000
12% promissory note due July, 2005 ...................................... 135,590 135,590 134,742 134,742
Warrants to purchase 561.0413 shares of common stock at $.01 per share .. 16,953 16,953 16,953 16,953
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MARCH 31, 2001 DECEMBER 31, 2000
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COST VALUATION COST VALUATION
---- --------- ---- ---------
FUTUREMED INTERVENTIONAL, INC
13.5% promissory note due February, 2005 ............................... 919,599 919,599 914,467 914,467
Warrants to purchase 383,111 shares of common stock at $.01 per share .. 102,640 102,640 102,640 102,640
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TOTAL HEALTHCARE PRODUCTS AND SERVICES (17.2% and 17.7% of total loans and
investments as of March 31, 2001 and December 31,2000, respectively) ... 2,224,782 2,218,802
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MANUFACTURING:
CHILDS & ALBERT
12.5% promissory note due October, 2005 ................................ 735,146 735,146 731,543 731,543
Warrants to purchase 833.334 shares of common stock at $10 per share ... 72,065 72,065 72,065 72,065
EASY SYSTEMS, INC
11% subordinated debenture due March, 2004 and warrants to purchase
291,393 shares of stock at $2.10 per share ........................... 777,422 100,000 777,422 100,000
142,857 shares of Series B preferred stock and warrants to purchase
240,000 shares of common stock at $2.10 per share .................... 300,000 --- 300,000 ---
HICKLIN ENGINEERING, L.C
10% subordinated note due June, 2003 ................................... 400,000 400,000 400,000 400,000
Warrant for 6,857 membership interests at $.01 per share ............... --- --- --- ---
12% subordinated note due January, 2001 through December, 2004 ......... 13,800 13,800 13,800 13,800
THE SCHEBLER COMPANY
13% promissory note due March, 2005 .................................... 157,901 157,901 157,353 157,353
Warrants to purchase 1.66% of common stock at $.01 per share ........... 11,504 11,504 11,504 11,504
166,666 shares of 10% convertible cumulative preferred stock ........... 166,667 166,667 166,667 166,667
166,666 shares of common stock ......................................... 166,667 166,667 166,667 166,667
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TOTAL MANUFACTURING (14.1% and 14.5% of total loans and investments
as of March 31, 2001 and December 31, 2000, respectively) .............. 1,823,750 1,819,599
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OTHER SERVICE INDUSTRIES:
BRISTOL RETAIL SOLUTIONS
500,000 shares of 12% cumulative convertible preferred stock ........... 820,083 820,083 820,083 820,083
Warrants to purchase 464,979 shares of common stock at $.01 per share .. 179,917 317,096 179,917 151,273
INTERNATIONAL PACIFIC SEAFOODS, INC
12% subordinated note due June 2003 through June 2005 and warrants
to purchase 1,501 shares of common stock for $.76 per share .......... 1,000,000 1,000,000 1,000,000 1,000,000
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MARCH 31, 2001 DECEMBER 31, 2000
----------------------- ----------------------
COST VALUATION COST VALUATION
---- --------- ---- ---------
KINSETH HOSPITALITY COMPANY, INC
14% note due May, 2003 ................................................. 2,000,000 2,000,000 2,000,000 2,000,000
Warrants for 25% of the outstanding common stock at $0.01 per share .... --- --- --- ---
PICKERMAN'S DEVELOPMENT COMPANY
12% promissory notes due April, 2005 through March, 2006 ............... 536,739 536,739 353,476 353,476
Warrants to purchase 2,406,250 shares and 1,043,294 shares of common stock
at March 31, 2001 and December 31, 2000, respectively, at $0.01 per share 72,849 72,849 52,606 52,606
SERVECORE BUSINESS SOLUTIONS, INC
3,663 shares of common stock ........................................... 990,000 990,000 990,000 990,000
----------- -----------
TOTAL OTHER SERVICE INDUSTRIES (44.2% and 42.7% of total loans and investments
as of March 31, 2001 and December 31, 2000, respectively) .............. 5,736,767 5,367,438
----------- -----------
TOTAL LOANS AND INVESTMENTS ............................................... $12,958,776 $12,559,951
=========== ===========
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NOTE C - DEBENTURES
The Trust has debentures payable to the SBA totalling $9,500,000 as of March 31,
2001. The debentures require the semiannual payment of interest at annual
interest rates ranging from 6.353% to 7.64%. In addition to interest payments,
the Trust is required to pay an annual 1% SBA loan fee on the outstanding
debentures balance. The debentures contain certain pre-payment penalties and are
subject to all of the regulations promulgated under the Small Business
Investment Act of 1958, as amended. Debentures totalling $1,000,000, $6,575,000,
$725,000, and $1,200,000 are to be paid in full on September, 2009, March, 2010,
September, 2010, and March, 2011, respectively.
As of March 31, 2001, the SBIC has unused leverage commitments totalling
$500,000 and will be required to pay a 2.5% leverage and underwriting fee
totalling $12,500 that will be deducted pro rata as proceeds are drawn. Each
issuance of debentures is conditioned upon the SBIC's credit worthiness and
compliance with specified regulations, as determined by the SBA. The SBA may
also limit the amount that may be drawn each year. The SBA commitment expires
September 30, 2004.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS RESULTS OF OPERATIONS
Net investment income (loss) reflects the Trust's revenues and expenses
excluding realized and unrealized gains and losses on portfolio investments.
Interest income consists of the following:
Three Months Ending March 31
2001 2000
---- ----
Portfolio investments $ 225,452 $ 171,280
Money market 5,325 5,068
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Interest income $ 230,777 $ 176,348
=========== ===========
Dividend income $ 34,667 $ 76,356
=========== ===========
Changes in interest and dividends earned on portfolio investments reflect the
level of investment in interest and dividend earning securities. Money market
interest reflects cash resources that are invested in highly liquid money market
savings funds.
Management fees, calculated as 2.5% of the combined temporary investment in
money market securities and loans and investments balances, were $82,452 for the
first quarter of 2001 and $73,675 the same period a year ago. The increases in
management fees are due to an increased portfolio of loans and investments.
Management fees are paid quarterly to the Trust Advisor, in accordance with the
management agreement.
Interest expense was first incurred by the Trust in 1999 when it issued
debentures payable to the SBA through its wholly owned subsidiary, Berthel SBIC,
LLC. The Trust has issued debentures totalling $9,500,000. The debentures
require the semiannual payment of interest at annual interest rates ranging from
6.353% to 7.64%. In addition to interest payments, the Trust is required to pay
an annual 1% SBA loan fee on the outstanding debentures balance. The debentures
contain certain pre-payment penalties and are subject to all of the regulations
promulgated under the Small Business Investment Act of 1958, as amended.
Prepayment penalties are not applicable within five years of maturity. As of
March 31, 2001, the Trust was in violation of the maximum capital impairment
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percentage permitted by the SBA and has not obtained a waiver from the SBA. The
remedies available to the SBA include prohibiting the SBIC from making any
additional investments other than investments under existing legally binding
commitments, prohibiting distributions to investors, reviewing and redetermining
management expenses, and declaring the Debentures immediately due and payable.
Debentures totalling $1,000,000, $6,575,000, $725,000, and $1,200,000 are to be
paid in full on September, 2009, March, 2010, September, 2010, and March, 2011,
respectively.
The change in unrealized gains and losses recognized is summarized in the
following table:
Three Months Ending March 31
2001 2000
---- ----
Bristol Retail Solutions $ 165,823 $ -0-
Chequemate International (33,464) -0-
Edmin.com, Inc. 567,000 -0-
iBEAM Broadcasting
Corporation (163,625) -0-
LIVEware5, Inc. -0- 297,750
McLeodUSA, Inc. (159,072) -0-
Object Space, Inc. (200,000) -0-
------------ -------------
Unrealized gain (loss) $ 176,662 $ 297,750
============ =============
LIVEware5, Inc. was acquired by McLeodUSA, Inc. ("McLeod"). The Trust received
38,877 shares of McLeod in exchange for the investments in LIVEware5, Inc. stock
and debentures in April, 2000 (adjusted for the April 25, 2000 three-for-one
stock split). The McLeod shares were subject to a twelve-month restriction on
sales. McLeod common stock is publicly traded. Valuation of McLeod stock is
based upon actual market value less appropriate reserves to reflect restrictions
on sales.
Webcasts.com, Inc. merged with iBEAM Broadcasting Corporation ("iBEAM") on April
30, 2000. The Trust received 545,442 shares of iBEAM common stock and a 10%
unsecured note, which was been paid in full in 2000. The iBEAM common stock was
subject to a lockup period through November, 2000 and is subject to Rule 144 of
the Securities and Exchange Commission thereafter. iBEAM common stock is
publicly traded. The iBEAM common stock is valued based upon public market
prices less appropriate reserves to reflect restrictions on trading.
EDmin.com received an $3,000,000 investment from a strategic investor on March
13, 2001. The investment was in the form of Series B Preferred Stock and is
subordinate to the Trust's Series A Preferred Stock. The increase in unrealized
gain on Edmin.com is a result of the increased valuation resulting from the new
strategic investment.
Chequemate International, Inc. acquired the Trust's equity position in
VisionComm on December 30, 2000, in exchange for Chequemate common stock, a note
receivable, and warrants. Chequemate common stock is publicly traded. Valuation
of the Chequemate investment is based upon actual market value less appropriate
reserves to reflect restrictions on sales.
The unrealized gain in Bristol Retail Solutions reflects the market value of
their common stock in excess of the exercise price of the Trust's warrants.
ObjectSpace is attempting to sell its consulting business. An outlook on the
proceeds of a sale are
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too difficult to estimate at this time with the given market conditions. The
unrealized loss reflects a reserve of the remaining value for this investment.
The Trust is committed to invest $50,000 in 13% promissory notes due in five
years to be issued by Inter-Med, Inc. and will receive additional warrants to
acquire approximately 1.8% of the company for $0.01 per share.
During February 2001, the Trust entered into an agreement with Kinseth
Hospitality Company, Inc. ("Kinseth"), in which the Trust agreed to release its
warrants to purchase 25% of Kinseth common shares at $0.01 per share in exchange
for a lender's commitment to refinance the existing mortgage on certain Kinseth
property. The Lender's commitment was received on April 3, 2001. The proceeds
received from the lenders commitment must be used to pay off the outstanding
debt and accrued interest to the Trust by June 30, 2001.
LIQUIDITY AND CAPITAL RESOURCES
Three Months Ending March 31
----------------------------
2001 2000
---- ----
Major Cash Sources (Uses):
Issuance of debentures $ --- $ 2,250,000
Deferred financing costs incurred --- (56,250)
Changes in loans and investments (200,000) (2,992,308)
Cash and cash equivalents amounted to $254,502 at March 31, 2001 and $684,244 at
December 31, 2000. Net cash from operating activities was a net use of cash of
$429,742 for the three months ending March 31, 2001, and a net use of cash of
$3,313,300 for the same period in 2000. This change in cash flow is primarily
due to the change in loans and investments shown in the table above.
The Trust intends to make quarterly distributions of all cash revenues to the
extent it has cash available for such distributions. The Trustees declared no
distribution for the quarter ended March 31, 2001. Distributions from the
Trust's wholly-owned subsidiary, Berthel SBIC, LLC, to the Trust are restricted
under SBA regulations. Under SBA regulations, the SBIC subsidiary is not able to
distribute income to the parent unless it has "earnings available for
distribution" as defined by the SBA. At March 31, 2001, the SBIC had a deficit
of "earnings available for distribution" in the amount of $3,196,612.
Regardless of the ability to make current distributions in cash, the Trust has
accrued an 8% priority return to beneficial owners of the Trust since June 1997.
A 10% underwriting return was accrued through the final closing of the offering
on June 21, 1997. Distributions payable of $2,503,191 have been accrued as of
March 31, 2001.
The effect of interest rate fluctuations and inflation on the current Trust
investments is negligible.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Trust's investment objective is to achieve capital appreciation in the value
of its net assets and to achieve current income principally by making
investments through private placements in securities of small and medium sized
privately and publicly owned companies. Securities consist of subordinated debt,
preferred stock, or common stock combined with equity participation in common
stock or rights to acquire common stock. Securities held for investment at March
31, 2001 are not held for trading purposes.
The primary risk of the portfolio is derived from the underlying ability of
investee companies to satisfy debt obligations and their ability to maintain or
improve common equity values. Levels of interest rates are not expected to
impact the Trust's valuations, but could impact the capability of investee
companies to repay debt or create and maintain shareholder value.
As of March 31, 2001, the portfolio is valued at fair value, as determined by
the Independent Trustees ("Trustees"). In determining fair value for securities
and warrants, investments are initially stated at cost until significant
subsequent events and operating trends require a change in valuation. Among the
factors considered by the Trustees in determining fair value of investments are
the cost of the investment, terms and liquidity of warrants, developments since
the acquisition of the investment, the sales price of recently issued
securities, the financial condition and operating results of the issuer,
earnings trends and consistency of operating cash flows, the long-term business
potential of the issuer, the quoted market price of securities with similar
quality and yield that are publicly traded, and other factors generally
pertinent to the valuation of investments. The Trustees relied on financial data
of the portfolio companies provided by the management of the portfolio
companies.
The Trust Advisor maintains ongoing contact with management of the portfolio
companies including participation on their Boards of Directors and review of
financial information.
There is no assurance that any investment made by the Trust will be repaid or
re-marketed. Accordingly, there is a risk of total loss of any investment made
by the Trust. At March 31, 2001, the amount at risk was $12,958,776 and
consisted of the following:
Cost Valuation
Debt securities and loans $ 7,483,992 $ 6,588,704
Preferred stocks 3,349,550 3,211,750
Common stock 2,907,040 2,565,215
Warrants to purchase common stock 455,928 593,107
------------ -------------
Total loans and investments $ 14,196,510 $ 12,958,776
============ =============
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
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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.
BERTHEL GROWTH & INCOME TRUST I
-------------------------------
(Registrant)
Date: May 7, 2001 /s/ Ronald O. Brendengen
----------- -----------------------------------------------
Ronald O. Brendengen, Chief Financial Officer,
Treasurer
Date: May 7, 2001 /s/ Daniel P. Wegmann
----------- -----------------------------------------------
Daniel P. Wegmann, Controller
Date: May 7, 2001 /s/ Henry Royer
----------- -----------------------------------------------
Henry Royer, President
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