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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For
the quarterly period ended June 30, 2008
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from to
 Commission
File Number: 0-16718
 Northland Cable Properties Seven Limited Partnership
  Washington
    
    91-1366564(State of Organization)
    
    (I.R.S. Employer Identification No.)
 101 Stewart Street, Suite 700, Seattle, Washington
    
    98101(Address of Principal Executive Offices)
    
    (Zip Code)
  (Registrants telephone number, including area code)
  (Former name, former address and former fiscal year, if changed since last report)
  o þ
  Large accelerated filer
o
    
    Accelerated filer o
    
    Non-accelerated filer   o
(Do not check if a smaller reporting company)
    
    Smaller reporting company
þ
  o þ




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TABLE OF CONTENTS  PART 1  FINANCIAL INFORMATIONITEM 1. Financial StatementsITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Continuing OperationsITEM 3. Quantitative and Qualitative Disclosures About Market RiskITEM 4. Controls and ProceduresPART II  OTHER INFORMATIONITEM 1 Legal proceedingsITEM 1A Risk FactorsITEM 2 Changes in securitiesITEM 3 Defaults upon senior securitiesITEM 4 Submission of matters to a vote of security holdersITEM 5 Other informationITEM 6 ExhibitsSIGNATURESEXHIBIT 31.(A)EXHIBIT 31.(B)EXHIBIT 32.(A)EXHIBIT 32.(B)    Table of Contents  UNTIMELY
FILING




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June 30,
    
    
    December 31,2008
    
    
    2007ASSETSCash
    
    $
    1,277,704
    
    
    $
    928,495Accounts receivable
    
    
    202,529
    
    
    
    219,229Due from affiliates
    
    
    31,532
    
    
    
    105,577Prepaid expenses
    
    
    103,289
    
    
    
    80,222Property and equipment, net of accumulated
depreciation of $13,920,715 and $13,320,422,
respectively
    
    
    5,640,443
    
    
    
    5,985,714Franchise agreements, net of accumulated
amortization of $9,995,974, respectively
    
    
    9,606,966
    
    
    
    9,606,966Loan fees and other intangibles, net of accumulated
amortization of $692,080 and $806,150, respectively
    
    
    
    
    
    
    47,800Total assets
    
    $
    16,862,463
    
    
    $
    16,974,003LIABILITIES AND PARTNERS CAPITAL (DEFICIT)Accounts payable and accrued expenses
    
    $
    842,972
    
    
    $
    825,388Due to Managing General Partner and affiliates
    
    
    107,000
    
    
    
    46,476Deposits
    
    
    24,700
    
    
    
    20,870Subscriber prepayments
    
    
    179,806
    
    
    
    157,796Notes payable
    
    
    
    
    
    
    663,299Total liabilities
    
    
    1,154,478
    
    
    
    1,713,829Partners capital (deficit):General Partners:Contributed capital, net
    
    
    (25,367
    )
    
    
    (25,367
    )Accumulated deficit
    
    
    (28,209
    )
    
    
    (32,687
    )(53,576
    )
    
    
    (58,054
    )Limited Partners:Contributed capital, net
    
    
    18,554,382
    
    
    
    18,554,382Accumulated deficit
    
    
    (2,792,821
    )
    
    
    (3,236,154
    )15,761,561
    
    
    
    15,318,228Total partners capital
    
    
    15,707,985
    
    
    
    15,260,174Total liabilities and partners capital
    
    $
    16,862,463
    
    
    $
    16,974,003




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For the three months ended June 30,2008
    
    
    2007Service revenues
    
    $
    2,261,706
    
    
    $
    2,233,538Expenses:Cable system operations (including
$31,570 and $25,945 to affiliates in
2008 and 2007, respectively), excluding
depreciation and amortization shown below
    
    
    239,816
    
    
    
    202,823General and administrative (including
$241,434 and $218,002 to affiliates
in 2008 and 2007, respectively)
    
    
    601,957
    
    
    
    598,298Programming (including $3,077 and
$2,181 to affiliates in 2008 and 2007,
respectively)
    
    
    792,713
    
    
    
    797,032Depreciation
    
    
    301,753
    
    
    
    363,625Gain on disposal of assets
    
    
    
    
    
    
    (685
    )1,936,239
    
    
    
    1,961,093Income from operations
    
    
    325,467
    
    
    
    272,445Other income (expense):Interest expense and amortization of loan fees
    
    
    (40,990
    )
    
    
    (32,823
    )Interest income and other, net
    
    
    (105,786
    )
    
    
    746(146,776
    )
    
    
    (32,077
    )Net income
    
    $
    178,691
    
    
    $
    240,368Allocation of net income:General Partners
    
    $
    1,787
    
    
    $
    2,404Limited Partners
    
    $
    176,904
    
    
    $
    237,964Net income per limited
partnership unit (49,656 units):
    
    $
    4
    
    
    $
    5




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For the six months ended June 30,2008
    
    
    2007Service revenues
    
    $
    4,472,874
    
    
    $
    4,429,557Expenses:Cable system operations (including
$62,870 and $58,933 to affiliates in
2008 and 2007, respectively), excluding
depreciation and amortization shown below
    
    
    467,228
    
    
    
    404,999General and administrative (including
$475,690 and $426,572 to affiliates
in 2008 and 2007, respectively)
    
    
    1,165,393
    
    
    
    1,166,884Programming (including $5,977 and
$4,071 to affiliates in 2008 and 2007,
respectively)
    
    
    1,602,044
    
    
    
    1,589,039Depreciation
    
    
    602,685
    
    
    
    722,321Gain on disposal of assets
    
    
    (2,393
    )
    
    
    (1,887
    )3,834,957
    
    
    
    3,881,356Income from operations
    
    
    637,917
    
    
    
    548,201Other income (expense):Interest expense and amortization of loan fees
    
    
    (63,970
    )
    
    
    (71,932
    )Interest income and other, net
    
    
    (126,136
    )
    
    
    1,047(190,106
    )
    
    
    (70,885
    )Income from continuing operations
    
    
    447,811
    
    
    
    477,316Income from discontinued operations (note 6)
    
    
    
    
    
    
    59,928Net income
    
    $
    447,811
    
    
    $
    537,244Allocation of net income:General Partners
    
    $
    4,478
    
    
    $
    5,372Limited Partners
    
    $
    443,333
    
    
    $
    531,872Income from continuing operations per limited
partnership unit (49,656 units):
    
    $
    9
    
    
    $
    10Income from discontinued operations per limited
partnership unit (49,656 units):
    
    $
    
    
    
    $
    1




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For the six months ended June 30,2008
    
    
    2007CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    447,811
    
    
    $
    537,244Adjustments to reconcile net income to
cash provided by operating activities:Depreciation
    
    
    602,685
    
    
    
    722,321Loan fee amortization and write off
    
    
    47,800
    
    
    
    19,119Gain on sale of assets
    
    
    (2,393
    )
    
    
    (1,887
    )Gain from discontinued operations
    
    
    
    
    
    
    (59,928
    )(Increase) decrease in operating assets:Accounts receivable
    
    
    16,700
    
    
    
    (11,473
    )Due from affiliates
    
    
    74,045
    
    
    
    26,355Prepaid expenses
    
    
    (23,067
    )
    
    
    22,737Increase (decrease) in operating liabilities:Accounts payable and accrued expenses
    
    
    17,584
    
    
    
    (70,269
    )Due to Managing General Partner and affiliates
    
    
    60,524
    
    
    
    34,506Deposits
    
    
    3,830
    
    
    
    4,890Subscriber prepayments
    
    
    22,010
    
    
    
    (15,154
    )Net cash provided by operating activities
    
    
    1,267,529
    
    
    
    1,208,461CASH FLOWS FROM INVESTING ACTIVITIES:Purchase of property and equipment
    
    
    (263,721
    )
    
    
    (378,815
    )Proceeds from sale of systems
    
    
    
    
    
    
    985,955Proceeds from the sale of assets
    
    
    8,700
    
    
    
    5,647Net cash (used in) provided by investing activities
    
    
    (255,021
    )
    
    
    612,787CASH FLOWS FROM FINANCING ACTIVITIES:Principal payments on borrowings
    
    
    (663,299
    )
    
    
    (1,208,706
    )Net cash used in financing activities
    
    
    (663,299
    )
    
    
    (1,208,706
    )INCREASE IN CASH
    
    
    349,209
    
    
    
    612,542CASH, beginning of period
    
    
    928,495
    
    
    
    324,241CASH, end of period
    
    $
    1,277,704
    
    
    $
    936,783SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:Cash paid during the period for interest
    
    $
    16,170
    
    
    $
    30,358




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NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
 NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
 (1) Basis of Presentation
  (2) Intangible Assets
   (3) Notes Payable
     (4) Litigation




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(5) Potential Sale of Systems




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(6) Discontinued Operations




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PART I (continued)
 
 ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Continuing Operations
 Results of Continuing Operations  Six Months Ended June 30, 2008 and 2007
   
    
    $3,345,439 (75%) from basic and expanded services,
    
    $235,510 (5%) from premium services
    
    $31,111 (1%) from digital services
    
    $458,262 (10%) from high speed Internet services
    
    $62,830 (1%) from telephony services
    
    $148,904 (3%) from advertising
    
    $83,166 (2%) from late fees
    
    $107,652 (3 %) from other sources.




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Results of Operations  Three Months Ended June 2008 and 2007
   
    
    $1,688,933 (75%) from basic and expanded services,
    
    $117,786 (5%) from premium services
    
    $15,676 (1%) from digital services
    
    $235,623 (10%) from high speed Internet services
    
    $32,123 (1%) from telephony services
    
    $79,545 (4%) from advertising
    
    $42,155 (2%) from late fees
    
    $49,865 (2 %) from other sources.




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Liquidity and Capital Resources
     Notes Payable




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Obligations and Commitments
  Payments Due By PeriodLess than 1
    
    1  3
    
    3  5
    
    More thanTotal
    
    year
    
    Years
    
    years
    
    5 yearsMinimum operating lease payments
    
    $
    14,928
    
    
    $
    11,196
    
    
    $
    3,732
    
    
    
    
    
    
    
    
 (a)
    
    These contractual obligations do not include accounts payable and accrued
liabilities, which are expected to be paid in 2008.(b)
    
    The Partnership also rents utility poles in its operations. Amounts due under
these agreements are not included in the above minimum operating lease payments amounts
as, generally, pole rentals are cancelable on short notice. The Partnership does
however anticipate that such rentals will recur.
 Capital Expenditures
   Critical Accounting Policies
  Revenue Recognition
  Property and Equipment




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Intangible Assets
   
 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
  
 ITEM 4. Controls and Procedures




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Legal proceedings
      
 Risk Factors
  
 Changes in securities
  
 Defaults upon senior securities
  
 Submission of matters to a vote of security holders




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Other information
  
 Exhibits
 (a)
    
    Exhibit Index
 31 (a).
    
    Certification of Chief Executive Officer of Northland
Communications Corporation, the Managing General Partner, dated August 22, 2008
pursuant to section 302 of the Sarbanes-Oxley Act31 (b).
    
    Certification of President (Principal Financial and Accounting
Officer) of Northland Communications Corporation, the Managing General Partner,
dated August 22, 2008 pursuant to section 302 of the Sarbanes-Oxley Act32 (a).
    
    Certification of Chief Executive Officer of Northland
Communications Corporation, the Managing General Partner, dated August 22, 2008
pursuant to section 906 of the Sarbanes-Oxley Act32 (b).
    
    Certification of President (Principal Financial and Accounting
Officer) of Northland
Communications Corporation, the Managing General Partner, dated August 22,
2008 pursuant to section 906 of the Sarbanes-Oxley Act




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SIGNATURES
  NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
 
 SIGNATURES
    
    CAPACITIES
    
    DATE/s/ RICHARD I. CLARK

Richard I. Clark
    
    Executive Vice President, Treasurer and
Assistant Secretary
    
    8-22-08/s/ GARY S. JONES

Gary S. Jones
    
    President
    
    8-22-08