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

o		Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 0-16718

Northland Cable Properties Seven Limited Partnership

(Exact Name of Registrant as Specified in Charter)

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)

(206) 621-1351

N/A

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 þ		No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes o		No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller Reporting Company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o		No þ

 

 

PART 1 — FINANCIAL INFORMATION

ITEM 1. Financial Statements

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
CONDENSED BALANCE SHEETS — (UNAUDITED)
(Prepared by the Managing General Partner)

		June 30,				December 31,
		2010				2009
ASSETS
Cash		$	765,842			$	1,339,369
Accounts receivable, net of allowance of $9,750 and $11,250, respectively			239,444				333,366
Due from affiliates			29,593				53,628
Prepaid expenses			154,374				65,405
Property and equipment, net of accumulated depreciation of $15,952,198 and $15,392,597 respectively			6,151,487				5,915,231
Franchise agreements, net of accumulated amortization of $9,995,974			9,606,966				9,606,966
Total assets		$	16,947,706			$	17,313,965
LIABILITIES AND PARTNERS’ CAPITAL (DEFICIT)
Accounts payable and accrued expenses		$	766,535			$	837,047
Due to Managing General Partner and affiliates			111,472				79,141
Deposits			24,655				22,913
Subscriber prepayments			217,419				249,443
Total liabilities			1,120,081				1,188,544
Partners’ capital (deficit):
General Partners:
Contributed capital, net			(25,367	)			(25,367	)
Accumulated deficit			(5,908	)			(11,620	)
			(31,275	)			(36,987	)
Limited Partners:
Contributed capital, net (49,656 units)			16,444,002				17,312,982
Accumulated deficit			(585,102	)			(1,150,574	)
			15,858,900				16,162,408
Total partners’ capital			15,827,625				16,125,421
Total liabilities and partners’ capital		$	16,947,706			$	17,313,965

The accompanying notes are an integral part of these statements.

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF OPERATIONS — (UNAUDITED)

		For the six months ended June 30,
		2010				2009
Service revenues		$	4,842,485			$	4,812,794
Expenses:
Cable system operations / cost of revenue (including $66,463 and $69,573 to affiliates in 2010 and 2009, respectively), excluding depreciation shown below			463,118				442,185
General and administrative (including $497,619 and $507,094 to affiliates in 2010 and 2009, respectively)			1,301,666				1,292,016
Programming / cost of revenue (including $25,283 and $16,907 to affiliates in 2010 and 2009, respectively)			1,888,191				1,792,284
Depreciation / cost of revenue			607,606				601,692
(Gain) loss on disposal of assets			(377	)			2,631
			4,260,204				4,130,808
Income from operations			582,281				681,986
Other income (expense):
Other (expenses) net of interest income			(11,097	)			(24,873	)
			(11,097	)			(24,873	)
Net income		$	571,184			$	657,113
Allocation of net income:
General Partners (1%)		$	5,712			$	6,571
Limited Partners (99%)		$	565,472			$	650,542
Net income per limited partnership unit (49,656 units):			11.39				13.10

The accompanying notes are an integral part of these statements.

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF OPERATIONS — (UNAUDITED)

		For the three months ended June 30,
		2010				2009
Service revenues		$	2,438,958			$	2,433,090
Expenses:
Cable system operations / cost of revenue (including $34,165 and $34,633 to affiliates in 2010 and 2009, respectively), excluding depreciation shown below			232,693				220,608
General and administrative (including $240,629 and $266,374 to affiliates in 2010 and 2009, respectively)			657,767				690,690
Programming / cost of revenue (including $13,409 and $10,450 to affiliates in 2010 and 2009, respectively)			956,309				908,260
Depreciation / cost of revenue			306,322				301,678
Loss on disposal of assets			—				2,631
			2,153,091				2,123,867
Income from operations			285,867				309,223
Other income (expense):
Other (expenses) net of interest income			(925	)			(20,063	)
			(925	)			(20,063	)
Net income		$	284,942			$	289,160
Allocation of net income:
General Partners (1%)		$	2,849			$	2,892
Limited Partners (99%)		$	282,093			$	286,268
Net income per limited partnership unit (49,656 units):			5.68				5.77

The accompanying notes are an integral part of these statements.

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF CASH FLOWS — (UNAUDITED)

		For the six months ended June 30,
		2010				2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	571,184			$	657,113
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation			607,606				601,692
(Gain) loss on sale of assets			(377	)			2,631
(Increase) decrease in operating assets:
Accounts receivable			93,922				25,478
Due from affiliates			24,035				(10,868	)
Prepaid expenses			(88,969	)			(34,077	)
Increase (decrease) in operating liabilities:
Accounts payable and accrued expenses			(70,512	)			99,994
Due to Managing General Partner and affiliates			32,331				32,941
Deposits			1,742				1,120
Subscriber prepayments			(32,024	)			23,370
Net cash provided by operating activities			1,138,938				1,399,394
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment			(845,985	)			(784,942	)
Proceeds from the sale of assets			2,500				—
Net cash used in investing activities			(843,485	)			(784,942	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Distribution to limited partners			(868,980	)			(1,241,400	)
Net cash used in financing activities			(868,980	)			(1,241,400	)
DECREASE IN CASH			(573,527	)			(626,948	)
CASH, beginning of period			1,339,369				1,734,024
CASH, end of period		$	765,842			$	1,107,076

The accompanying notes are an integral part of these statements.

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

(1) Basis of Presentation

These unaudited financial statements are being filed in conformity with Rule 10-01 of Regulation S-X regarding interim financial statement disclosure and do not contain all of the necessary footnote disclosures required for a full presentation of the balance sheets, statements of operations and statements of cash flows in conformity with accounting principles generally accepted in the United States of America. However, in the opinion of management, these statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Partnership’s financial position at June 30, 2010, its statements of operations for the three and six months ended June 30, 2010 and 2009, and its statements of cash flows for the six months ended June 30, 2010 and 2009. Results of operations for these periods are not necessarily indicative of results to be expected for the full year. These financial statements and notes should be read in conjunction with the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2009.

(2) Intangible Assets

The Partnership does not amortize intangible assets determined to have indefinite lives. The Partnership has determined that its franchises meet the definition of indefinite lived assets. The Partnership tests these assets for impairment on an annual basis during the fourth quarter using financial information as of September 30th, or on an interim basis if an event occurs or circumstances change that would indicate that the assets might be impaired.

(3) Litigation

The Partnership is party to ordinary and routine litigation proceedings that are incidental to the Partnership’s business. Management believes that the outcome of all pending legal proceedings will not, individually or in the aggregate, have a material adverse effect on the Partnership and its financial statements.

(4) Potential Sale of Systems

On July 5, 2007, Northland Cable Properties Seven Limited Partnership (“the Partnership”) executed a purchase and sale agreement to sell the operating assets and franchise rights of its remaining cable systems serving the communities of Vidalia, Sandersville, Toccoa and Royston, Georgia to Green River Media and Communications, LLC (“Green River”), an unaffiliated third party. The transaction was expected to close by the end of March 2008. Closing of this transaction would have resulted in the liquidation of the Partnership.

The terms of the purchase and sale agreement include a sales price of $19,950,000, which may be adjusted based on subscription revenue generated prior to closing, and require that approximately ten percent of the gross proceeds be placed in escrow to secure compliance with representations and warranties, to be released to the Partnership eighteen months from the closing of the transaction. Net proceeds to be received upon closing are to be used to pay all remaining liabilities of the Partnership, including transaction costs and to make liquidating distributions to the limited partners. Limited partners will receive a final distribution eighteen months from the closing date when the escrow proceeds are released.

On December 19, 2007, the Partnership filed with the Security and Exchange Commission a definitive proxy statement under Regulation 14A of the Exchange Act, pursuant to which the Partnership solicited proxies from the limited partners in connection with the above described transactions. The proxy statement called for a special meeting of the limited partners held on February 27, 2008, for the following purposes: (i) to authorize the sale of substantially all the assets of the Partnership to Green River or its assignee with the consent of the Partnership, and (ii) to authorize the alternative sale of substantially all of the Partnership’s assets to Northland Communications Corporation, its managing general partner, or one or more affiliates of Northland Communications Corporation, if the Green River transaction was not consummated by March 31, 2008, or such later date mutually agreed upon by the Partnership and Green River, or in the event that the Green River transaction was otherwise terminated prior to such date (the “Alternative Sale Transaction”). The Alternative Sale Transaction agreement contains substantially the same terms and conditions as provided in the Green River purchase agreement, except that the managing general partner’s obligation to close will be subject to the managing general partner’s ability to secure satisfactory financing. If such condition has not been met within 90 days after the agreement for the Alternative Sale Transaction becomes effective, the managing general partner would have the right to terminate the alternative purchase agreement without penalty. On February 27, 2008, at the special meeting of limited partners of the Partnership, limited partners voted to approve the two matters discussed above.

On March 31, 2008, the Partnership notified Green River of its termination of the asset purchase agreement dated as of July 5, 2007 between the Partnership and Green River (“the Agreement”). Green River disputed the right of the Partnership to terminate the Agreement and filed a motion in the District Court, City and County of Denver, seeking injunctive relief. Green River’s motion for preliminary injunction was granted by the court on May 13, 2008.

On September 9, 2008, the District Court, for the City and County of Denver upheld the preliminary injunction enjoining the Partnership from terminating the Agreement. The Partnership appealed the initial injunction order of the District Court as originally entered and as subsequently modified. On May 13, 2010 the Colorado Court of Appeals reversed the opinion of the District Court and remanded the case with instructions to vacate the preliminary injunction. The timing and ultimate disposition of this litigation cannot be determined at this time.

Fees for legal activities in connection with the aforementioned purchase and sale transaction amounted to $1,052 and $15,103 for the three months ended June 30, 2010 and 2009, respectively, and have been expensed as incurred within interest income and other in the accompanying statements of operations.

(5) Fair Value of Assets

We measure certain financial assets at fair value in three levels, based on the markets in which the assets are traded and the reliability of the inputs used to determine fair value. These levels are:

	•		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.

The following table summarizes the balances of assets measured at fair value on a recurring basis at June 30, 2010.

		Total				Level 1				Level 2				Level 3
Cash		$	765,842			$	765,842			$	—			$	—

The following table summarizes the balances of assets measured at fair value on a recurring basis at December 31, 2009.

		Total				Level 1				Level 2				Level 3
Cash		$	1,339,369			$	1,339,369			$	—			$	—

The Partnership follows the provisions of FASB ASC 820 Fair Value Measurements and Disclosures. The fair value of cash approximates its carrying value.

(6) Accounting Pronouncements Issued Not Yet Adopted

In September 2009, the FASB ratified Accounting Standards Update (ASU) 2009-13 (ASU 2009-13) (previously Emerging Issues Task Force (EITF) Issue No. 08-1, Revenue Arrangements with Multiple Deliverables (EITF 08-1)). ASU 2009-13 superseded EITF 00-21 and addresses criteria for separating the consideration in multiple-element arrangements. ASU 2009-13 will require companies to allocate the overall consideration to each deliverable by using a best estimate of the selling price of individual deliverables in the arrangement in the absence of vendor-specific objective evidence or other third-party evidence of the selling price. ASU 2009-13 will be effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010 and early adoption will be permitted. The Partnership has not adopted ASU 2009-13. Management is currently evaluating the potential impact, if any, of the adoption of ASU 2009-13 on the Partnership’s results of operations and financial condition.

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, 2010 and 2009

Total basic subscribers decreased from 11,237 as of June 30, 2009 to 10,313 as of June 30, 2010. The loss in subscribers is a result of several factors including competition from Direct Broadcast Satellite (DBS) providers, availability of off-air signals in the Partnership’s markets and regional and local economic conditions. To address this customer trend, the Partnership is increasing its customer retention efforts and its emphasis on bundling its video, data and phone products.

Revenue totaled $4,842,485 for the six months ended June 30, 2010, an increase of approximately 1% from $4,812,794 for the six months ended June 30, 2009. Revenue for the six months ended June 30, 2010, was comprised of the following sources:

	•		$3,346,056 (69%) from basic and expanded video services,
	•		$686,025 (14%) from high speed Internet services
	•		$250,629 (5%) from telephony services
	•		$180,738 (4%) from premium video services
	•		$131,654 (3%) from advertising
	•		$89,795 (2%) from late fees
	•		$157,588 (3%) from other sources.

Average monthly revenue per subscriber increased $6.74 or approximately 10% from $70.04 for the six months ended June 30, 2009 to $76.78 for the six months ended June 30, 2010. This increase is attributable to increased penetration of new products, specifically, high-speed Internet and telephony services and rate increases implemented throughout the Partnership’s systems during the first quarter of 2010. This increase in average monthly revenue per subscriber was offset by the aforementioned decrease in basic subscribers.

Operating expenses, excluding general and administrative, programming, depreciation expenses, and gain/loss on disposal of assets totaled $463,118 for the six months ended June 30, 2010, representing an increase of approximately 5% from $442,185 for the six months ended June 30, 2009. This increase is primarily attributable to increased operating salaries, pole rental expense and vehicle operating expenses.

General and administrative expenses totaled $1,301,666 for the six months ended June 30, 2010, representing an increase of approximately 1% from $1,292,016 for the six months ended June 30, 2009. This increase is primarily attributable to increased administrative salaries, audit fees and marketing expenses offset by decreases in administrative overhead and bad debt expense.

Programming expenses totaled $1,888,191 for the six months ended June 30, 2010, an increase of approximately 5% from $1,792,284 for the six months ended June 30, 2009. The increase is attributable to higher costs charged by various program suppliers and increased costs associated with the increased penetration of high-speed Internet and telephony services, offset by a decrease in basic subscribers from 11,237 as of June 30, 2009 to 10,313 as of June 30, 2010. Rate increases from program suppliers, as well as new fees due to the launch of additional channels and high-speed Internet services, will contribute to the trend of increased programming costs in the future, assuming that the number of subscribers remains constant.

Depreciation expense totaled $607,606 for the six months ended June 30, 2010, an increase of approximately 1% from $601,692 for the six months ended June 30, 2009. Depreciation of recent purchases related to the upgrade of plant and equipment was partially offset by certain assets becoming fully depreciated.

Interest income and other, net totaled $11,097 and $24,873 for the six months ended June 30, 2010 and 2009, respectively, and consists primarily of costs incurred in connection with the litigation associated with the proposed sale of the Partnership’s assets.

Results of Operations — Three Months Ended June 30, 2010 and 2009

Total basic subscribers decreased from 11,237 as of June 30, 2009 to 10,313 as of June 30, 2010. The loss in subscribers is a result of several factors including competition from Direct Broadcast Satellite (DBS) providers, availability of off-air signals in the Partnership’s markets and regional and local economic conditions. To address this customer trend, the Partnership is increasing its customer retention efforts and its emphasis on bundling its video, data and phone products.

Revenue totaled $2,438,958 for the three months ended June 30, 2010, a slight increase from $2,433,090 for the three months ended June 30, 2009. Revenue for the three months ended June 30, 2010, was comprised of the following sources:

	•		$1,656,963 (68%) from basic and expanded video services,
	•		$355,431 (14%) from high speed Internet services
	•		$137,920 (6%) from telephony services
	•		$89,043 (4%) from premium video services
	•		$80,429 (3%) from advertising
	•		$45,696 (2%) from late fees
	•		$73,476 (3%) from other sources.

Average monthly revenue per subscriber increased $6.57 or approximately 9% from $71.41 for the three months ended June 30, 2009 to $77.98 for the three months ended June 30, 2010. This increase is attributable to increased penetration of new products, specifically, high-speed Internet and telephony services and rate increases implemented throughout the Partnership’s systems during the first quarter of 2010. This increase in average monthly revenue per subscriber was offset by the aforementioned decrease in basic subscribers.

Operating expenses, excluding general and administrative, programming, depreciation expenses, and loss on disposal of assets totaled $232,693 for the three months ended June 30, 2010, representing an increase of approximately 5% from $220,608 for the three months ended June 30, 2009. This increase is primarily attributable to increased vehicle operating expenses.

General and administrative expenses totaled $657,767 for the three months ended June 30, 2010, representing a decrease of approximately 5% from $690,690 for the three months ended June 30, 2009. A bad debt reserve recorded in 2009 for an advertising receivable of which the collection was uncertain in the amount of $53,772 offset increases in administrative salaries, administrative services and audit fees for three months ended June 30, 2010.

Programming expenses totaled $956,309 for the three months ended June 30, 2010, an increase of approximately 5% from $908,260 for the three months ended June 30, 2009. The increase is attributable to higher costs charged by various program suppliers and increased costs associated with the increased penetration of high-speed Internet and telephony services, offset by a decrease in basic subscribers from 11,237 as of June 30, 2009 to 10,313 as of June 30, 2010. Rate increases from program suppliers, as well as new fees due to the launch of additional channels and high-speed Internet services, will contribute to the trend of increased programming costs in the future, assuming that the number of subscribers remains constant.

Depreciation expense totaled $306,322 for the three months ended June 30, 2010, an increase of approximately 2% from $301,678 for the three months ended June 30, 2009. Depreciation of recent purchases related to the upgrade of plant and equipment was partially offset by certain assets becoming fully depreciated.

Interest income and other, net totaled $925 and $20,063 for the three months ended June 30, 2010 and 2009, respectively, and consists primarily of costs incurred in connection with the litigation associated with the proposed sale of the Partnership’s assets.

Liquidity and Capital Resources

The Partnership’s primary source of liquidity is cash flow provided by operations. The Partnership generates cash through the monthly billing of subscribers for cable and other services. Based on management’s analysis, the Partnership’s cash flow from operations and cash on hand will be sufficient to cover future operating costs, planned capital expenditures and working capital needs over the next twelve-month period.

Net cash provided by operating activities totaled $1,138,938 for the six months ended June 30, 2010. Adjustments to the $571,184 net income for the period to reconcile to net cash provided by operating activities consisted primarily of depreciation of $607,606 offset by changes in other operating assets and liabilities of $39,475.

Net cash used in investing activities totaled $843,485 for the six months ended June 30, 2010 and consisted primarily of purchases of property and equipment.

Net cash used in financing activities for the six months ended June 30, 2010 consisted of $868,980 in cash distributions to limited partners.

Obligations and Commitments

In addition to working capital needs for ongoing operations, the Partnership has capital requirements related to minimum operating lease payments. The following table summarizes the Partnership’s contractual obligations as of June 30, 2010:

						Payments Due By Period
										1 – 3				3 – 5
		Total				Less than 1 year				Years				years				More than 5 years
Minimum operating lease payments		$	26,133			$	5,600			$	20,533				—				—

Capital Expenditures

During the first six months of 2010, the Partnership paid approximately $846,000 for capital expenditures. These expenditures include the continued construction of fiber and quality assurance projects to upgrade the plant providing increased channel capacity in all systems as well as customer premise equipment to receive all communications services provided by the Partnership.

Management has estimated that the Partnership will spend approximately $1,200,000 on capital expenditures during the remainder of 2010. Planned expenditures include the continuation of distribution plant upgrades to increase channel capacity and two-way capability in all systems, potential line extension opportunities, the possible launch of additional HD (high definition) services in selected systems, vehicle replacements and the continued deployment of both high-speed Internet and digital telephone services in certain areas of the Partnership’s systems.

Critical Accounting Policies

This discussion and analysis of our financial condition and results of operations is based on the Partnership’s financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. The following critical accounting policies require a more significant amount of management judgment than other accounting policies the Partnership employs.

Revenue Recognition

Cable television service, internet and telephone revenue, including service and maintenance, is recognized in the month service is provided to customers. Advance payments on services to be rendered are recorded as subscriber prepayments and deferred. Revenues resulting from the sale of local spot advertising are recognized when the related advertisements or commercials appear before the public.

Property and Equipment

Property and equipment are recorded at cost. Costs of additions and substantial improvements, which include materials, labor, and other indirect costs associated with the construction of cable transmission and distribution facilities, are capitalized. Indirect costs include employee salaries and benefits, travel and other costs. These costs are estimated based on historical information and analysis. The Partnership performs evaluations of these estimates as warranted by events or changes in circumstances.

The Partnership capitalizes costs associated with initial customer installations. The costs of disconnecting service or reconnecting service to previously installed locations is expensed in the period incurred. Costs for repairs and maintenance are also charged to operating expense, while equipment replacements, including the replacement of drops, are capitalized.

Intangible Assets

The Partnership does not amortize intangible assets determined to have indefinite lives. The Partnership has determined that its franchises meet the definition of indefinite lived assets. The Partnership tests these assets for impairment on an annual basis during the fourth quarter using financial information as of September 30th, or on an interim basis if an event occurs or circumstances change that would indicate the assets might be impaired.

Management believes the Partnership’s franchises have indefinite lives because they are expected to be used by the Partnership for the foreseeable future as determined based on an analysis of all pertinent factors, including changes in legal, regulatory or contractual provisions and effects of obsolescence, demand and competition. In addition, the level of maintenance expenditures required to obtain the future cash flows expected from the franchises is not material in relation to the carrying value of the franchises. While the franchises have defined lives based on the franchising authority, renewals are routinely granted, and management expects them to continue to be granted. This expectation is supported by management’s experience with the Partnership’s franchising authorities and the franchising authorities of the Partnership’s affiliates.

ITEM 3.		Quantitative and Qualitative Disclosures About Market Risk

The Partnership is not subject to market risks arising from changes in interest rates.

ITEM 4.		Controls and Procedures

The Partnership maintains disclosure controls and procedures designed to ensure that information required to be disclosed in our filings under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. The Chief Executive Officer and President (Principal Financial and Accounting Officer) of the Managing General Partner have evaluated these disclosure controls and procedures as of the end of the period covered by this quarterly report on Form 10-Q and have determined that such disclosure controls and procedures are effective.

There has been no change during the most recent quarter in the Partnership’s internal controls over financial reporting that has materially affected, or is reasonably likely to materially affect, the internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 1		Legal proceedings

On March 31, 2008, the Partnership notified Green River Media and Communications LLC (“Green River”) of its termination of the asset purchase agreement dated as of July 5, 2007, between the Partnership and Green River (“the Agreement”). Green River disputed the right of the Partnership to terminate the Agreement and filed a motion in the District Court, City and County of Denver, seeking injunctive relief. Green River’s motion for preliminary injunction was granted by the court.

On September 9, 2008, the District Court, for the City and County of Denver upheld a preliminary injunction enjoining the Partnership from terminating the Agreement. Pursuant to the District Court’s preliminary injunction, the Agreement currently remains in full force and effect. The Partnership appealed the initial injunction order of the District Court as originally entered and as subsequently modified. On May 13, 2010 the Colorado Court of Appeals reversed the opinion of the District Court and remanded the case with instructions to vacate the preliminary injunction. The timing and ultimate disposition of this litigation cannot be determined at this time.

The Partnership may be party to other ordinary and routine litigation proceedings that are incidental to the Partnership’s business. Management believes that the outcome of such legal proceedings will not, individually or in the aggregate, have a material adverse effect on the Partnership, its financial conditions and prospects.

ITEM 1A		Risk Factors

There have been no material changes from the Partnership’s risk factors as disclosed in the 2009 Form 10-K.

ITEM 2		Changes in securities

     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		Exhibits

(a)

Exhibit Index

	31 (a).		Certification of Chief Executive Officer of Northland Communications Corporation, the Managing General Partner, dated August 13, 2010 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, 2010 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, 2010 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, 2010 pursuant to section 906 of the Sarbanes-Oxley Act

SIGNATURES

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.

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP

BY: Northland Communications Corporation,
Managing General Partner

SIGNATURES		CAPACITIES		DATE
/s/ RICHARD I. CLARK		Executive Vice President, Treasurer and		8-13-10
Richard I. Clark		Assistant Secretary
/s/ GARY S. JONES		President		8-13-10
Gary S. Jones