##### Table of Contents



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, 2009
 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)
  þ o
 o o
  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 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 ExhibitsSIGNATURESEX-31.(A)EX-31.(B)EX-32.(A)EX-32.(B)    Table of Contents  
  
  
 June 30,
    
    
    December 31,2009
    
    
    2008ASSETSCash
    
    $
    1,107,076
    
    
    $
    1,734,024Accounts receivable
    
    
    246,479
    
    
    
    271,957Due from affiliates
    
    
    38,494
    
    
    
    27,626Prepaid expenses
    
    
    95,977
    
    
    
    61,900Property and equipment, net of accumulated
depreciation of $14,886,857 and
$14,304,219,
respectively
    
    
    5,750,782
    
    
    
    5,570,163Franchise agreements, net of accumulated
amortization of $9,995,974
    
    
    9,606,966
    
    
    
    9,606,966Total assets
    
    $
    16,845,774
    
    
    $
    17,272,636LIABILITIES AND PARTNERS CAPITAL (DEFICIT)Accounts payable and accrued expenses
    
    $
    838,708
    
    
    $
    738,714Due to Managing General Partner and
affiliates
    
    
    122,060
    
    
    
    89,119Deposits
    
    
    25,715
    
    
    
    24,595Subscriber prepayments
    
    
    248,717
    
    
    
    225,347Total liabilities
    
    
    1,235,200
    
    
    
    1,077,775Partners capital (deficit):General Partners:Contributed capital, net
    
    
    (25,367
    )
    
    
    (25,367
    )Accumulated deficit
    
    
    (16,769
    )
    
    
    (23,340
    )(42,136
    )
    
    
    (48,707
    )Limited Partners:Contributed capital, net
    
    
    17,312,982
    
    
    
    18,554,382Accumulated deficit
    
    
    (1,660,272
    )
    
    
    (2,310,814
    )15,652,710
    
    
    
    16,243,568Total partners capital
    
    
    15,610,574
    
    
    
    16,194,861Total liabilities and partners capital
    
    $
    16,845,774
    
    
    $
    17,272,636




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For the three months ended June 30,2009
    
    
    2008Service revenues
    
    $
    2,433,090
    
    
    $
    2,261,706Expenses:Cable system operations / cost of revenue
(including $34,633 and $31,570 to affiliates
in 2009 and 2008, respectively), excluding
depreciation shown below
    
    
    220,608
    
    
    
    239,816General and administrative (including
$266,374 and $241,434 to affiliates
in 2009 and 2008, respectively)
    
    
    690,690
    
    
    
    601,957Programming / cost of revenue (including
$10,450 and $3,077 to affiliates in
2009 and 2008, respectively)
    
    
    908,260
    
    
    
    792,713Depreciation / cost of revenue
    
    
    301,678
    
    
    
    301,753Loss on disposal of assets
    
    
    2,631
    
    
    
    2,123,867
    
    
    
    1,936,239Income from operations
    
    
    309,223
    
    
    
    325,467Other income (expense):Interest expense and amortization of loan fees
    
    
    
    
    
    
    (40,990
    )Interest income and other, net
    
    
    (20,063
    )
    
    
    (105,786
    )(20,063
    )
    
    
    (146,776
    )Net income
    
    $
    289,160
    
    
    $
    178,691Allocation of net income:General Partners (1%)
    
    $
    2,892
    
    
    $
    1,787Limited Partners (99%)
    
    $
    286,268
    
    
    $
    176,904Net income per limited
partnership unit (49,656 units):
    
    
    5.77
    
    
    
    3.56




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For the six months ended June 30,2009
    
    
    2008Service revenues
    
    $
    4,812,794
    
    
    $
    4,472,874Expenses:Cable system operations / cost of revenue
(including $69,573 and $62,870 to affiliates
in 2009 and 2008, respectively), excluding
depreciation shown below
    
    
    442,185
    
    
    
    467,228General and administrative (including
$507,094 and $475,690 to affiliates
in 2009 and 2008, respectively)
    
    
    1,292,016
    
    
    
    1,165,393Programming / cost of revenue (including
$16,907 and $5,977 to affiliates in
2009 and 2008, respectively)
    
    
    1,792,284
    
    
    
    1,602,044Depreciation / cost of revenue
    
    
    601,692
    
    
    
    602,685Loss (gain) on disposal of assets
    
    
    2,631
    
    
    
    (2,393
    )4,130,808
    
    
    
    3,834,957Income from operations
    
    
    681,986
    
    
    
    637,917Other income (expense):Interest expense and amortization of loan fees
    
    
    
    
    
    
    (63,970
    )Interest income and other, net
    
    
    (24,873
    )
    
    
    (126,136
    )(24,873
    )
    
    
    (190,106
    )Net income
    
    $
    657,113
    
    
    $
    447,811Allocation of net income:General Partners (1%)
    
    $
    6,571
    
    
    $
    4,478Limited Partners (99%)
    
    $
    650,542
    
    
    $
    443,333Net income per limited
partnership unit (49,656 units):
    
    
    13.10
    
    
    
    8.93




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For the six months ended June 30,2009
    
    
    2008CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    657,113
    
    
    $
    447,811Adjustments to reconcile net income to
cash provided by operating activities:Depreciation
    
    
    601,692
    
    
    
    602,685Loan fee amortization
    
    
    
    
    
    
    47,800Loss (gain) on sale of assets
    
    
    2,631
    
    
    
    (2,393
    )(Increase) decrease in operating assets:Accounts receivable
    
    
    25,478
    
    
    
    16,700Due from affiliates
    
    
    (10,868
    )
    
    
    74,045Prepaid expenses
    
    
    (34,077
    )
    
    
    (23,067
    )Increase (decrease) in operating liabilities:Accounts payable and accrued expenses
    
    
    99,994
    
    
    
    17,584Due to Managing General Partner and affiliates
    
    
    32,941
    
    
    
    60,524Deposits
    
    
    1,120
    
    
    
    3,830Subscriber prepayments
    
    
    23,370
    
    
    
    22,010Net cash provided by operating activities
    
    
    1,399,394
    
    
    
    1,267,529CASH FLOWS FROM INVESTING ACTIVITIES:Purchase of property and equipment
    
    
    (784,942
    )
    
    
    (263,721
    )Proceeds from the sale of assets
    
    
    
    
    
    
    8,700Net cash used in investing activities
    
    
    (784,942
    )
    
    
    (255,021
    )CASH FLOWS FROM FINANCING ACTIVITIES:Principal payments on borrowings
    
    
    
    
    
    
    (663,299
    )Distribution to limited partners
    
    
    (1,241,400
    )
    
    
    Net cash used in financing activities
    
    
    (1,241,400
    )
    
    
    (663,299
    )(DECREASE) INCREASE IN CASH
    
    
    (626,948
    )
    
    
    349,209CASH, beginning of period
    
    
    1,734,024
    
    
    
    928,495CASH, end of period
    
    $
    1,107,076
    
    
    $
    1,277,704SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:Cash paid during the period for interest
    
    $
    
    
    
    $
    16,170




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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
  (5) Potential Sale of Systems




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(6) Fair Value of Assets and Liabilities
  
    
    Level 1  inputs are quoted prices (unadjusted) in active markets for identical
assets or liabilities.
    
    Level 2  quoted prices for similar instruments in active markets or quoted prices
for identical or similar instruments in markets that are not active.
    
    Level 3  significant inputs are unobservable for the asset or liability.
  Total
    
    Level 1
    
    Level 2
    
    Level 3Cash
    
    $
    1,107,076
    
    
    $
    1,107,076
    
    
    $
    
    
    
    $
    
 (7) Subsequent Events




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PART I (continued)
 
 ITEM 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations
 Results of Operations  Six Months Ended June 30, 2009 and 2008
   
    
    $3,501,933 (73%) from basic and expanded services,
 
    
    $204,643 (4%) from premium services
 
    
    $22,984 (0%) from digital services
 
    
    $572,024 (12%) from high speed Internet services
 
    
    $139,886 (3%) from telephony services
 
    
    $149,360 (3%) from advertising
 
    
    $88,891 (2%) from late fees
 
    
    $133,073 (3% ) from other sources.




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Results of Operations  Three Months Ended June 30, 2009 and 2008
   
    
    $1,759,646 (72%) from basic and expanded services,
 
    
    $101,378 (4%) from premium services
 
    
    $10,958 (1%) from digital services
 
    
    $297,454 (12%) from high speed Internet services
 
    
    $76,187 (3%) from telephony services
 
    
    $80,202 (3%) from advertising
 
    
    $45,126 (2%) from late fees
 
    
    $62,139 (3% ) from other sources.




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Liquidity and Capital Resources
     Notes Payable
  Obligations and Commitments
  Payments Due By PeriodLess than 1
    
    1  3
    
    3  5
    
    More thanTotal
    
    year
    
    Years
    
    years
    
    5 yearsMinimum operating lease payments
    
    $
    10,932
    
    
    $
    10,932
    
    
    
    
    
    
    
    
    
    
    
    
 
 (a)
    
    These contractual obligations do not include accounts payable and accrued
liabilities, which are expected to be paid in 2009.(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. Pole rental expense was $154,843 in
2008. Capital Expenditures




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Critical Accounting Policies
  Revenue Recognition
  Property and Equipment
   Intangible Assets
   
 ITEM 3.
    
    Quantitative and Qualitative Disclosures About Market Risk




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ITEM 4.
    
    Controls and Procedures




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ITEM 1
    
    Legal proceedings
    
 ITEM 1A
    
    Risk Factors
  
 ITEM 2
    
    Changes in securities
  
 ITEM 3
    
    Defaults upon senior securities
  
 ITEM 4
    
    Submission of matters to a vote of security holders
  
 ITEM 5
    
    Other information
  
 ITEM 6
    
    Exhibits
 (a)
    
    Exhibit Index
 31 (a).
    
    Certification of Chief Executive Officer of Northland
Communications Corporation, the Managing General Partner, dated August 13, 2009
pursuant to section 302 of the Sarbanes-Oxley Act
 31 (b).
    
    Certification of President (Principal Financial and Accounting
Officer) of Northland Communications Corporation, the Managing General Partner,
dated August 13, 2009 pursuant to section 302 of the Sarbanes-Oxley Act
 32 (a).
    
    Certification of Chief Executive Officer of Northland
Communications Corporation, the Managing General Partner, dated August 13, 2009
pursuant to section 906 of the Sarbanes-Oxley Act
 32 (b).
    
    Certification of President (Principal Financial and Accounting
Officer) of Northland
Communications Corporation, the Managing General Partner, dated August 13,
2009 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
    
    8-13-09/S/ GARY S. JONES

Gary S. Jones
    
    President
    
    8-13-09