-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N6bNqZc7g26A2OmuMmNu+pOqeMtoY/zBbmC9mRA/48l/e5proMlPOJNZ4J3b4syh nSCBVuNeuvMPrDGKbSGzsA== 0001013167-98-000004.txt : 19981116 0001013167-98-000004.hdr.sgml : 19981116 ACCESSION NUMBER: 0001013167-98-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980930 FILED AS OF DATE: 19981113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SMITH BARNEY MID WEST FUTURES FUND LP II CENTRAL INDEX KEY: 0001013167 STANDARD INDUSTRIAL CLASSIFICATION: [6221] IRS NUMBER: 133772374 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-28336 FILM NUMBER: 98747412 BUSINESS ADDRESS: STREET 1: 390 GREENWICH ST STREET 2: FIRST FL CITY: NEW YORK STATE: NY ZIP: 10013 BUSINESS PHONE: 2127235424 MAIL ADDRESS: STREET 1: 390 GREENWICH ST STREET 2: FIRST FLOOR CITY: NEW YORK STATE: NY ZIP: 10013 10-Q 1 SMITH BARNEY MID-WEST FUTURES FUND L.P. II FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (X) QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter ended September 30, 1998 Commission File Number 0-28336 SMITH BARNEY MID-WEST FUTURES FUND L.P. II (Exact name of registrant as specified in its charter) New York 13-3772374 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) c/o Smith Barney Futures Management Inc. 390 Greenwich St. - 1st Fl. New York, New York 10013 (Address and Zip Code of principal executive offices) (212) 723-5424 (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 SMITH BARNEY MID-WEST FUTURES FUND L.P. II FORM 10-Q INDEX Page Number PART I - Financial Information: Item 1. Financial Statements: Statement of Financial Condition at September 30, 1998 and December 31, 1997. 3 Statement of Income and Expenses and Partners' Capital for the three and nine months ended September 30, 1998 and 1997. 4 Notes to Financial Statements 5 - 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 - 11 Item 3. Quantitative and Qualitative Disclosures of Market Risk 12 PART II - Other Information 13 - 14 2 PART I Item 1. Financial Statements SMITH BARNEY MID-WEST FUTURES FUND L.P. II STATEMENT OF FINANCIAL CONDITION September 30, December 31, 1998 1997 Assets: ------------- ------------ (Unaudited) Equity in commodity futures trading account: Cash and cash equivalents $ 79,953,549 $ 98,812,037 Net unrealized appreciation on open futures contracts 24,038,376 4,837,350 ------------ ------------ 103,991,925 103,649,387 Interest receivable 266,041 349,777 ------------ ------------ $104,257,966 $103,999,164 ============ ============ LIABILITIES AND PARTNERS' CAPITAL: Liabilities: Accrued expenses: Commissions $ 521,290 $ 519,996 Management fees 345,609 344,931 Administrative fees 86,402 86,233 Incentive fees 832,948 1,062,363 Other 53,980 47,822 Redemptions payable 795,784 620,745 ------------ ------------ 2,636,013 2,682,090 ------------ ------------ Partners' Capital: General Partner, 608.9156 Unit equivalents outstanding in 1998 and 1997 1,136,237 1,055,939 Limited Partners, 53,850.8178 and 57,816.3107 Units of Limited Partnership Interest outstanding in 1998 and 1997, respectively 100,485,716 100,261,135 ------------ ------------ 101,621,953 101,317,074 ------------ ------------ $104,257,966 $103,999,164 ============ ============ See Notes to Financial Statements. 3 SMITH BARNEY MID-WEST FUTURES FUND L.P. II STATEMENT OF INCOME AND EXPENSES AND PARTNERS' CAPITAL (UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, ------------------------------ ------------------------------ 1998 1997 1998 1997 Income: Net gains (losses) on trading of commodity futures: Realized gains (losses) on closed positions $ 58,379 $ 9,854,146 $ (6,893,386) $ 3,355,023 Change in unrealized gains/losses on open positions 28,506,170 4,606,113 19,201,026 6,109,922 _____________ _____________ _____________ _____________ 28,564,549 14,460,259 12,307,640 9,464,945 Less, brokerage commissions and clearing fees ($21,803, $23,998, $64,559 and $51,824 respectively) (1,461,753) (1,528,028) (4,293,932) (4,073,916) _____________ _____________ _____________ _____________ Net realized and unrealized gains 27,102,796 12,932,231 8,013,708 5,391,029 Interest income 820,501 943,813 2,614,483 2,581,096 _____________ _____________ _____________ _____________ 27,923,297 13,876,044 10,628,191 7,972,125 _____________ _____________ _____________ _____________ Expenses: Management fees 905,102 976,642 2,666,689 2,623,293 Administrative fees 226,275 244,160 666,671 655,578 Incentive fees 832,948 327,899 832,948 327,899 Other 19,662 6,499 61,014 63,111 _____________ _____________ _____________ _____________ 1,983,987 1,555,200 4,227,322 3,669,881 _____________ _____________ _____________ _____________ Net income 25,939,310 12,320,844 6,400,869 4,302,244 Additions - - - 26,876,900 Redemptions (2,710,127) (948,514) (6,095,990) (3,359,906) _____________ _____________ _____________ _____________ Net increase in Partners' capital 23,229,183 11,372,330 304,879 27,819,238 Partners' capital, beginning of period 78,392,770 84,898,377 101,317,074 68,451,469 _____________ _____________ _____________ _____________ Partners' capital, end of period $ 101,621,953 $ 96,270,707 $ 101,621,953 $ 96,270,707 ------------- ------------- ------------- ------------- Net asset value per Unit (54,459.7334 and 59,557.5932 Units outstanding at September 30, 1998 and 1997, respectively) $ 1,866.00 $ 1,616.43 $ 1,866.00 $ 1,616.43 ------------- ------------- ------------- ------------- Net income per Unit of Limited Partnership Interest and General Partner Unit equivalent $ 470.04 $ 204.91 $ 131.87 $ 78.50 ------------- ------------- ------------- -------------
See Notes to Financial Statements 4 Smith Barney Mid-West Futures Fund L.P. II Notes to Financial Statements September 30, 1998 (Unaudited) 1. General: Smith Barney Mid-West Futures Fund L.P. II,(the "Partnership") is a limited partnership which was organized on June 3, 1994 under the partnership laws of the State of New York to engage in the speculative trading of a diversified portfolio of commodity interests including futures contracts, options and forward contracts. The commodity interests that are traded by the Partnership are volatile and involve a high degree of market risk. The Partnership commenced trading operations on September 1, 1994. Smith Barney Futures Management Inc. acts as the general partner (the "General Partner") of the Partnership. On September 1, 1998, the Partnership's commodity broker, Smith Barney Inc., merged with Salomon Brothers Inc and changed its name to Salomon Smith Barney Inc. ("SSB"). SSB is an affiliate of the General Partner. The General Partner is wholly owned by Salomon Smith Barney Holdings Inc. ("SSBH"), which is the sole owner of SSB. SSBH is a wholly owned subsidiary of Travelers Group Inc. All trading decisions for the Partnership are being made by John W. Henry & Company, Inc. (the "Advisor"). (see Note 5) The accompanying financial statements are unaudited but, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Partnership's financial condition at September 30, 1998 and the results of its operations for the three and nine months ended September 30, 1998 and 1997. These financial statements present the results of interim periods and do not include all disclosures normally provided in annual financial statements. It is suggested that these financial statements be read in conjunction with the financial statements and notes included in the Partnership's annual report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 1997. Due to the nature of commodity trading, the results of operations for the interim periods presented should not be considered indicative of the results that may be expected for the entire year. 5 Smith Barney Mid-West Futures Fund L.P. II Notes to Financial Statements (continued) 2. Net Asset Value Per Unit: Changes in net asset value per Unit for the three and nine months ended September 30, 1998 and 1997 were as follows: THREE-MONTHS ENDED NINE-MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, 1998 1997 1998 1997 Net realized and unrealized gains $ 491.20 $ 215.09 $ 160.84 $ 98.21 Interest income 14.78 15.75 45.88 45.60 Expenses (35.94) (25.93) (74.85) (65.31) --------- --------- --------- --------- Increase for period 470.04 204.91 131.87 78.50 Net Asset Value per Unit, beginning of period 1,395.96 1,411.52 1,734.13 1,537.93 --------- --------- --------- --------- Net Asset Value per Unit, end of period $1,866.00 $1,616.43 $1,866.00 $1,616.43 ========= ========= ========= ========= 3. Trading Activities: The Partnership was formed for the purpose of trading contracts in a variety of commodity interests, including derivative financial instruments and derivative commodity instruments. The results of the Partnership's trading activity are shown in the statement of income and expenses. The Customer Agreement between the Partnership and SSB gives the Partnership the legal right to net unrealized gains and losses. All of the commodity interests owned by the Partnership are held for trading purposes. The fair value of these commodity interests, including options thereon, at September 30, 1998 and December 31, 1997 was $24,038,376 and $4,837,350, respectively, and the average fair value during the nine and twelve months then ended, based on monthly calculation, was $3,817,400 and $5,283,180, respectively. 4. Financial Instrument Risk: The Partnership is party to financial instruments with off- balance sheet risk, including derivative financial instruments and derivative commodity instruments, in the normal course of its 6 business. These financial instruments include forwards, futures and options, whose value is based upon an underlying asset, index, or reference rate, and generally represent future commitments to exchange currencies or cash flows, to purchase or sell other financial instruments at specific terms at specified future dates, or, in the case of derivative commodity instruments, to have a reasonable possibility to be settled in cash or with another financial instrument. These instruments may be traded on an exchange or over-the-counter ("OTC"). Exchange traded instruments are standardized and include futures and certain option contracts. OTC contracts are negotiated between contracting parties and include forwards and certain options. Each of these instruments is subject to various risks similar to those related to the underlying financial instruments including market and credit risk. In general, the risks associated with OTC contracts are greater than those associated with exchange traded instruments because of the greater risk of default by the counterparty to an OTC contract. Market risk is the potential for changes in the value of the financial instruments traded by the Partnership due to market changes, including interest and foreign exchange rate movements and fluctuations in commodity or security prices. Market risk is directly impacted by the volatility and liquidity in the markets in which the related underlying assets are traded. Credit risk is the possibility that a loss may occur due to the failure of a counterparty to perform according to the terms of a contract. Credit risk with respect to exchange traded instruments is reduced to the extent that an exchange or clearing organization acts as a counterparty to the transactions. The Partnership's risk of loss in the event of counterparty default is typically limited to the amounts recognized in the statement of financial condition and not represented by the contract or notional amounts of the instruments. The Partnership has concentration risk because the sole counterparty or broker with respect to the Partnership's assets is SSB. The General Partner monitors and controls the Partnership's risk exposure on a daily basis through financial, credit and risk management monitoring systems and, accordingly believes that it has effective procedures for evaluating and limiting the credit and market risks to which the Partnership is subject. These monitoring systems allow the General Partner to statistically analyze actual trading results with risk adjusted performance indicators and correlation statistics. In addition, on-line monitoring systems provide account analysis of futures, forwards and options positions by sector, margin requirements, gain and loss transactions and collateral positions. The notional or contractual amounts of these instruments, while not recorded in the financial statements, reflect the extent 7 of the Partnership's involvement in these instruments. At September 30, 1998, the notional or contractual amounts of the Partnership's commitment to purchase and sell these instruments was $1,685,762,793 and $71,341,851, respectively, as detailed below. All of these instruments mature within one year of September 30, 1998. However, due to the nature of the Partnership's business, these instruments may not be held to maturity. At September 30, 1998, the fair value of the Partnership's derivatives, including options thereon, was $24,038,376, as detailed below. SEPTEMBER 30, 1998 NOTIONAL OR CONTRACTUAL AMOUNT OF COMMITMENTS TO PURCHASE TO SELL FAIR VALUE Currencies * $ 210,187,464 $ 47,251,757 $ 4,771,905 Interest Rates U.S. 415,664,100 - 5,806,025 Interest Rates Non-U.S. 1,059,813,606 3,286,548 12,069,579 Indices 97,623 20,803,546 1,390,867 -------------- -------------- -------------- Totals $1,685,762,793 $ 71,341,851 $ 24,038,376 ============== ============== ============== At December 31, 1997, the notional or contractual amounts of the Partnership's commitment to purchase and sell these instruments was $439,703,147 and $674,462,459, respectively, and the fair value of the Partnership's derivatives, including options thereon, was $4,837,350, as detailed below. DECEMBER 31, 1997 NOTIONAL OR CONTRACTUAL AMOUNT OF COMMITMENTS TO PURCHASE TO SELL FAIR VALUE Currencies * $112,161,137 $214,988,952 $ (476,904) Interest Rates U.S. 93,164,750 - 740,813 Interest Rates Non-U.S. 222,477,455 410,908,324 268,873 Metals 11,899,805 39,967,590 3,603,175 Indices - 8,597,593 701,393 ------------ ------------ ------------ Totals $439,703,147 $674,462,459 $ 4,837,350 ============== ============ ============== * The notional or contractual commitment amounts and the fair value amounts listed for the currency sector represent OTC contracts. All other sectors listed represent exchange traded contracts. 5. Subsequent Event: On October 8, 1998, Travelers Group Inc. merged with Citicorp Inc. and changed its name to Citigroup Inc. 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Liquidity and Capital Resources The Partnership does not engage in the sale of goods or services. Its only assets are its equity in its commodity futures trading account, net unrealized appreciation (depreciation) on open futures and forward contracts, commodity options and interest receivable. Because of the low margin deposits normally required in commodity futures trading, relatively small price movements may result in substantial losses to the Partnership. While substantial losses could lead to a decrease in liquidity, no such losses occurred in the third quarter of 1998. The Partnership's capital consists of the capital contributions of the partners as increased or decreased by gains or losses on commodity futures trading, expenses, interest income, redemptions of Units and distributions of profits, if any. For the nine months ended September 30, 1998, Partnership capital increased 0.3% from $101,317,074 to $101,621,953. This increase was primarily attributable to a net gain from operations of $6,400,869 which was partially offset by the redemption of 3,965.4929 Units resulting in an outflow of $6,095,990 for the nine months ended September 30, 1998. Future redemptions can impact the amount of funds available for investments in commodity contract positions in subsequent periods. Operational Risk The General Partner administers the business of the Partnership through various systems and processes maintained by SSBH. SSBH has analyzed the impact of the year 2000 on its systems and processes and modifications for compliance are proceeding according to plan. All modifications necessary for year 2000 compliance are expected to be completed by the first quarter of 1999. In July 1998, SSB participated in successful industry-wide testing coordinated by the Securities Industry Association and plans to participate in such tests in the future. The purpose of industry-wide testing is to confirm that exchanges, clearing organizations, and other securities industry participants are prepared for the year 2000. The most likely and most significant risk to the Partnership associated with the lack of year 2000 readiness is the failure of outside organizations, including the commodities exchanges, clearing organizations or regulators with which the Partnership interacts to resolve their year 2000 issues in a timely manner. This risk could involve the inability to determine the value of the Partnership at 9 some point in time and would make effecting purchases or redemptions of Units in the Partnership infeasible until such valuation was determinable. In addition, the General Partner is addressing the technological implications that will result from regulatory and market changes due to Europe's Economic and Monetary Union ("EMU"). Risks to the Partnership exist in the lack of experience with this new currency and the potential impact it can have on the Advisors' trading program. Risks also exist in the failure of external information technology and accounting systems to adequately prepare for the conversion. This issue is particularly acute in the area of the exchanges, clearing houses and over-the-counter foreign exchange markets where the futures interests are traded. If the necessary changes are not properly implemented, the Partnership could suffer failed trade settlements, inability to reconcile trading positions and funding disruptions. Such events could result in erroneous entries in the Partnership's accounts, mispriced transactions, and a delay or inability to provide timely pricing of Units for the purpose of effecting purchases and redemptions. SSB has evaluated its internal systems and made the necessary changes to accommodate EMU transactions on behalf of the Partnership. The General Partner will continue to monitor and communicate with the Advisor and related third-party entities to assure preparation for the EMU conversion and advanced notification of impending issues or problems. Results of Operations During the Partnership's third quarter of 1998, the net asset value per Unit increased 33.7% from $1,395.96 to $1,866.00 as compared to the third quarter of 1997 in which the net asset value per Unit increased 14.5%. The Partnership experienced a net trading gain before brokerage commissions and related fees in the third quarter of 1998 of $28,564,549. Gains were recognized in the trading of commodity futures in currencies, U.S. and non-U.S. interest rates and metals and were partially offset by losses in indices. The Partnership experienced a net trading gain before brokerage commissions and related fees in the third quarter of 1997 of $14,460,259. Gains were recognized in the trading of commodity futures in currencies, U.S.and non-U.S. interest rates, metals and indices. Commodity futures markets are highly volatile. Broad price fluctuations and rapid inflation increase the risks involved in commodity trading, but also increase the possibility of profit. The profitability of the Partnership depends on the existence of major price trends and the ability of the Advisor to identify correctly those price trends. Price trends are influenced by, among other 10 things, changing supply and demand relationships, weather, governmental, agricultural, commercial and trade programs and policies, national and international political and economic events and changes in interest rates. To the extent that market trends exist and the Advisor is able to identify them, the Partnership expects to increase capital through operations. Interest income on 80% of the Partnership's average daily equity was earned at the monthly average 30 day U.S. Treasury bill rate. Interest income for the three months ended September 30, 1998 decreased by $123,312 and for the nine months ended September 30, 1998, increased by $33,387 as compared to the corresponding periods in 1997. The decrease in interest income is primarily the result of the effect of redemptions on the Partnership's equity maintained in cash during the three month period. The increase in interest income over the nine month period is primarily the result of an increase in the Partnership's equity maintained in cash during the nine months ended September 30, 1998 as compared to 1997. Brokerage commissions are calculated on the adjusted net asset value on the last day of each month and, therefore, vary according to trading performance, additions and redemptions. Accordingly, they must be compared in relation to the fluctuations in the monthly net asset values. Commissions and fees for the three months ended September 30, 1998 decreased by $66,275 and for the nine months ended September 30, 1998 increased by $220,016 as compared to the corresponding periods in 1997. All trading decisions for the Partnership are currently being made by the Advisor. Management fees are calculated as a percentage of the Partnership's net asset value as of the end of each month and are affected by trading performance, additions and redemptions. Management fees for the three months ended September 30, 1998 decreased by $71,540 and for the nine months ended September 30, 1998 increased by $43,396 as compared to the corresponding periods in 1997. Administrative fees are paid to the General Partner for administering the business and affairs of the Partnership. These fees are calculated as a percentage of the Partnership's net asset value as of the end of each month and are affected by trading performance, additions and redemptions. Administrative fees for the three months ended September 30, 1998 decreased by $17,885 and for the nine months ended September 30, 1998 administrative fees increased by $11,093 as compared to the corresponding periods in 1997. Incentive fees are based on the new trading profits generated by the Advisor as defined in the advisory agreement between the Partnership, the General Partner and the Advisor. Trading Performance for the three and nine months ended September 30, 1998 and resulted in incentive fees of $832,948. Trading performance for the three and nine months ended September 30, 1997 resulted in incentive fees of $327,899. 11 Item 3. Quantitative and Qualitative Disclosures of Market Risk The Partnership is subject to SEC Financial Reporting Release No. 48, regarding quantitative and qualitative disclosures of market risk and will comply with the disclosure and reporting requirements in its Form 10-K as of December 31, 1998. 12 PART II OTHER INFORMATION Item 1. Legal Proceedings Between May 1994 and the present, Salomon Brothers Inc. ("SBI"), Smith Barney Inc. ("SB") and The Robinson Humphrey Company, Inc. ("R-H"), all currently subsidiaries of Salomon Smith Barney Holdings Inc. ("SSBH"), along with a number of other broker-dealers, were named as defendants in approximately 25 federal court lawsuits and two state court lawsuits, principally alleging that companies that make markets in securities traded on NASDAQ violated the federal antitrust laws by conspiring to maintain a minimum spread of $.25 between the bid and asked price for certain securities. The federal lawsuits and one state court case were consolidated for pre-trial purposes in the Southern District of New York in the fall of 1994 under the caption In re NASDAQ Market-Makers Antitrust Litigation, United States District Court, Southern District of New York No. 94-CIV-3996 (RWS); M.D.L. No. 1023. The other state court suit, Lawrence A. Abel v. Merrill Lynch & Co., Inc. et al.; Superior Court of San Diego, Case No. 677313, has been dismissed without prejudice in conjunction with a tolling agreement. In consolidated action, the plaintiffs purport to represent a class of persons who bought one or more of what they currently estimate to be approximately 1,650 securities on NASDAQ between May 1, 1989 and May 27, 1994. They seek unspecified monetary damages, which would be trebled under the antitrust laws. The plaintiffs also seek injunctive relief, as well as attorney's fees and the costs of the action. (The state cases seek similar relief.) Plaintiffs in the consolidated action filed an amended consolidated complaint that defendants answered in December 1995. On November 26, 1996, the Court certified a class composed of retail purchasers. A motion to include institutional investors in the class and to add class representatives was granted. In December 1997, SBI, SB and R-H, along with several other broker-dealer defendants, executed a settlement agreement with the plaintiffs. This agreement has been preliminarily approved by the U.S. District Court for the Southern District of New York but is subject to final approval. On July 17, 1996, the Antitrust Division of the Department of Justice filed a complaint against a number of firms that act as market makers in NASDAQ stocks. The complaint basically alleged that a common understanding arose among NASDAQ market makers which worked to keep quote spreads in 13 NASDAQ stocks artificially wide. Contemporaneous with the filing of the complaint, SBI, SB and other defendants entered into a stipulated settlement agreement, pursuant to which the defendants would agree not to engage in certain practices relating to the quoting of NASDAQ securities and would further agree to implement a program to ensure compliance with federal antitrust laws and with the terms of the settlement. In entering into the stipulated settlement, SBI and SB did not admit any liability. There are no fines, penalties, or other payments of monies in connection with the settlement. In April 1997, the U.S. District Court for the Southern District of New York approved the settlement. In May 1997, plaintiffs in the related civil action (who were permitted to intervene for limited purposes) appealed the district court's approval of the settlement. The appeal was argued in March 1998 and was affirmed in August 1998. The Securities and Exchange Commission ("SEC") is also conducting a review of the NASDAQ marketplace, during which it has subpoenaed documents and taken the testimony of various individuals including SBI and SB personnel. In July 1996, the SEC reached a settlement with the National Association of Securities Dealers and issued a report detailing certain conclusions with respect to the NASD and the NASDAQ market. In December 1996, a complaint seeking unspecified monetary damages was filed by Orange County, California against numerous brokerage firms, including SB, in the U.S. Bankruptcy Court for the Central District of California. Plaintiff alleged, among other things, that the defendants recommended and sold to plaintiff unsuitable securities. The case (County of Orange et al. v. Bear Stearns & Co. Inc. et al.) has been stayed by agreement of the parties. Item 2. Changes in Securities and Use of Proceeds - None Item 3. Defaults Upon Senior Securities - None Item 4. Submission of Matters to a Vote of Security Holders - None Item 5. Other Information - None Item 6. (a) Exhibits - None (b) Reports on Form 8-K - None 14 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. SMITH BARNEY MID-WEST FUTURES FUND L.P. II By: Smith Barney Futures Management Inc. (General Partner) By: /s/ David J. Vogel, President David J. Vogel, President Date: 11/12/98 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 and on the dates indicated. By: Smith Barney Futures Management Inc. (General Partner) By: /s/ David J. Vogel, President David J. Vogel, President Date: 11/12/98 By: /s/ Daniel A. Dantuono Daniel A. Dantuono Chief Financial Officer and Director Date: 11/12/98 15 EX-27 2 FINANCIAL DATA SCHEDULE
5 0001013167 SMITH BARNEY MID-WEST FUTURES FUND L.P.II 9-MOS DEC-31-1998 JAN-01-1998 SEP-30-1998 79,953,549 24,038,376 266,041 0 0 104,257,966 0 0 104,257,966 2,636,013 0 0 0 0 101,621,953 104,257,966 0 10,628,191 0 0 4,227,322 0 0 6,400,869 0 0 0 0 0 6,400,869 131.87 0
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