SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): January 9, 1998
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(Exact name of registrant as specified in its charter)
Colorado 0-15378 84-1024657
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(State of Organization) (Commission File No.) (IRS Employer
Identification No.)
P.O. Box 3309, Englewood, Colorado 80155-3309 (303) 792-3111
- --------------------------------------------- --------------
(Address of principal executive office and Zip Code (Registrant's
telephone no.
including area code)
Item 2. Sale of Assets
--------------
On January 9, 1998, Jones Cable Income Fund 1-B/C Venture, a Colorado
general partnership (the "Venture"), sold the cable television system serving
subscribers in the communities of Clearlake and Lake Port, all in the State of
California (the "System"), to an unaffiliated party (the "Purchaser"), for a
sales price of $21,400,000, subject to customary closing adjustments. Jones
Cable Income Fund 1-B, Ltd. (the "Partnership") and Jones Cable Income Fund 1-C,
Ltd. ("Fund 1-C"), both Colorado limited partnerships, are the partners in the
Venture, owning a 40 percent and a 60 percent interest, respectively. Jones
Intercable, Inc. is the general partner of these limited partnerships and
manages the Venture's cable systems. The Purchaser is not affiliated with the
Venture or with Jones Intercable, Inc.
The Venture will distribute, prior to the end of February 1998,
approximately $11,000,000 to the Partnership and Fund 1-C, which amount
represents the net sale proceeds following the Venture's payment of a brokerage
fee to a subsidiary of Jones Intercable, Inc. totaling approximately $535,000
and the repayment of a portion of the Venture's credit facility. The Partnership
will receive $4,374,700 of such distribution and will, in turn, distribute such
amount (approximately $105 per each $1,000 invested in the Partnership) to the
limited partners of the Partnership. Because the distribution to the limited
partners of the Partnership together with all prior distributions will not
return the amount initially contributed by the limited partners to the
Partnership plus the preferred return provided by the Partnership's limited
partnership agreement, the general partner of the Partnership will not receive a
general partner distribution from the sale proceeds. Because the sale of the
System did not represent a sale of all or substantially all of the Partnership's
assets, no vote of the limited partners of the Partnership was required to
approve this sale.
2
Item 7. Financial Statements and Exhibits
---------------------------------
a. Financial statements of business acquired. Not applicable.
-----------------------------------------
b. Pro forma financial information. Pro forma financial statements of
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Jones Cable Income Fund 1-B, Ltd. and Jones Cable Income Fund 1-B/C Venture
reflecting the disposition of the System are attached hereto.
c. Exhibits.
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2.1 Asset Purchase Agreement dated September 17, 1997 between
Jones Cable Income Fund 1-B/C Venture and Mediacom California LLC.
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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 hereunto duly authorized.
JONES CABLE INCOME
FUND 1-B, LTD.
By Jones Intercable, Inc.,
General Partner
Dated: January 21, 1998 By: /s/ Elizabeth M. Steele
-----------------------
Elizabeth M. Steele
Vice President
(34009)
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UNAUDITED PRO FORMA FINANCIAL INFORMATION
OF JONES CABLE INCOME FUND 1-B, LTD.
The following unaudited pro forma balance sheet assumes that as of
September 30, 1997, Jones Cable Income Fund 1-B/C Venture (the "Venture") had
sold the cable television system serving subscribers in the communities of
Clearlake and Lake Port, all in the State of California (the "System") for
$21,400,000. Jones Cable Income Fund 1-B, Ltd. (the "Partnership") and Jones
Cable Income Fund 1-C, Ltd. ("Fund 1-C"), are the partners in the Venture. The
funds available to the Venture, adjusting for the estimated net closing
adjustments of the System, are expected to total approximately $21,305,058.
Such funds will be used to repay indebtedness of the Venture, and $11,000,000
will be distributed to the partners of the Venture. The Partnership will then
distribute $4,374,700 to the limited partners of the Partnership. The unaudited
pro forma statements of operations assume that the System was sold as of January
1, 1996.
The Partnership will continue to own a 40 percent interest in the
Venture.
The unaudited pro forma financial information should be read in
conjunction with the appropriate notes to the unaudited pro forma financial
information.
ALL OF THE FOLLOWING UNAUDITED PRO FORMA FINANCIAL INFORMATION IS
BASED UPON AMOUNTS AS OF SEPTEMBER 30, 1997 AND CERTAIN ESTIMATES OF LIABILITIES
AT CLOSING. FINAL RESULTS MAY DIFFER FROM SUCH INFORMATION.
5
JONES CABLE INCOME FUND 1-B, LTD.
UNAUDITED PRO FORMA BALANCE SHEET
September 30, 1997
Pro Forma Pro Forma
As Reported Adjustments Balance
------------ ------------ ---------
ASSETS
Cash and cash equivalents $ 145 $ - $ 145
Investment in cable television joint venture 2,457,005 (93,791) 2,363,214
--------- ----------- ---------
Total assets $ 2,457,150 $ (93,791) $ 2,363,359
========= =========== =========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities $ - $ - $ -
--------- ----------- ---------
Partners' capital 2,457,150 (93,791) 2,363,359
--------- ----------- ---------
Total liabilities and partners' capital $ 2,457,150 $ (93,791) $ 2,363,359
========= =========== =========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited balance sheet.
6
JONES CABLE INCOME FUND 1-B, LTD.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Year Ended December 31, 1996
Pro Forma Pro Forma
As Reported Adjustments Balance
-------------- ----------- -----------
REVENUES $ 862,911 $ - $ 862,911
COSTS AND EXPENSES:
Operating expenses 730,908 - 730,908
Management fees and allocated overhead from
General Partner 106,575 - 106,575
Depreciation and amortization 227,488 - 227,488
---------- ----------- ----------
OPERATING LOSS (202,060) - (202,060)
---------- ----------- ----------
OTHER INCOME (EXPENSES):
Interest expense (123,888) - (123,888)
Gain on sale of cable television system 11,122,663 - 11,122,663
Other, net 205,408 - 205,408
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Total other income (expense), net 11,204,183 - 11,204,183
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INCOME BEFORE EQUITY IN NET
LOSS OF CABLE TELEVISION
JOINT VENTURE 11,002,123 - 11,002,123
EQUITY IN NET LOSS OF
CABLE TELEVISION JOINT VENTURE (1,185,182) 128,198 (1,056,984)
---------- ----------- ----------
NET INCOME $ 9,816,941 $ 128,198 $ 9,945,139
========== =========== ==========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited statement.
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JONES CABLE INCOME FUND 1-B, LTD.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Nine Months Ended September 30, 1997
Pro Forma Pro Forma
As Reported Adjustments Balance
------------ ------------ ---------
EQUITY IN NET INCOME (LOSS) OF
CABLE TELEVISION JOINT VENTURE $ 7,259,488 $ (93,791) $ 7,165,697
--------- ----------- ---------
NET INCOME $ 7,259,488 $ (93,791) $ 7,165,697
========= =========== =========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited statement.
8
JONES CABLE INCOME FUND 1-B, LTD.
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
1) The following calculations present the sale of the System and the
resulting estimated proceeds expected to be received by the Partnership.
2) The unaudited pro forma balance sheet assumes that the Venture had sold
the System for $21,400,000 as of September 30, 1997. The unaudited statements
of operations assume that the Venture had sold the System as of January 1, 1996.
3) The estimated gain recognized from the sale of the System and
corresponding estimated distribution to limited partners as of September 30,
1997 has been computed as follows:
GAIN ON SALE OF ASSETS:
Contract sales price $21,400,000
Less: Net book value of investment in cable
television properties at September 30, 1997 8,243,294
----------
Gain on sale of assets $13,156,706
==========
DISTRIBUTIONS TO PARTNERS:
Contract sales price $21,400,000
Working capital adjustment:
Add: Current assets 279,343
Less: Current liabilities (374,285)
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ADJUSTED CASH RECEIVED BY THE VENTURE 21,305,058
- --------------------------------------------------------------------------
Less: Repayment of outstanding debt to third parties (9,799,994)
Payment of brokerage fee (535,000)
Plus: Cash on hand 29,936
----------
Cash available for distribution $11,000,000
==========
Distribution to the Partnership $ 4,374,700
==========
Distribution to Fund 1-C $ 6,625,300
==========
4) The pro forma statements of operations reflect the sale of the System
and the repayment of approximately $9,799,994 of debt with proceeds of such
sale. The Partnership will continue to own a 40 percent interest in the
Venture.
9
UNAUDITED PRO FORMA FINANCIAL INFORMATION
OF JONES CABLE INCOME FUND 1-B/C VENTURE
The following unaudited pro forma balance sheet assumes that as of
September 30, 1997, Jones Cable Income Fund 1-B/C Venture (the "Venture") had
sold the cable television system serving subscribers in the communities of
Clearlake and Lake Port, all in the State of California (the "System") for
$21,400,000. Jones Cable Income Fund 1-B, Ltd. ("Fund 1-B") and Jones Cable
Income Fund 1-C, Ltd. ("Fund 1-C"), are the partners in the Venture. The funds
available to the Venture, adjusting for the estimated net closing adjustments of
the System, are expected to total approximately $21,305,058. Such funds will be
used to repay indebtedness of the Venture, and $11,000,000 will be distributed
to the partners of the Venture. Fund 1-B and Fund 1-C will then distribute
$4,374,700 and $6,625,300, respectively, to their limited partners. The
unaudited pro forma statements of operations assume that the System was sold as
of January 1, 1996.
The Venture will continue to own the cable television systems serving areas
in and around Myrtle Creek, Oregon; South Sioux City, Nebraska; and Three Rivers
and Watervliet, Michigan.
The unaudited pro forma financial information should be read in conjunction
with the appropriate notes to the unaudited pro forma financial information.
ALL OF THE FOLLOWING UNAUDITED PRO FORMA FINANCIAL INFORMATION IS BASED
UPON AMOUNTS AS OF SEPTEMBER 30, 1997 AND CERTAIN ESTIMATES OF LIABILITIES AT
CLOSING. FINAL RESULTS MAY DIFFER FROM SUCH INFORMATION.
10
JONES CABLE INCOME FUND 1-B/C VENTURE
UNAUDITED PRO FORMA BALANCE SHEET
September 30, 1997
Pro Forma Pro Forma
As Reported Adjustments Balance
------------- ------------ ----------
ASSETS
Cash and cash equivalents $ 351,111 $ (29,936) $ 321,175
Trade receivables, net 264,337 (133,580) 130,757
Investment in cable television properties:
Property, plant and equipment, net 21,000,541 (6,580,294) 14,420,247
Intangibles, net 8,772,724 (1,663,000) 7,109,724
---------- ----------- ----------
Total investment in cable television properties 29,773,265 (8,243,294) 21,529,971
Deposits, prepaid expenses and deferred charges 907,575 (145,763) 761,812
---------- ----------- ----------
Total assets $ 31,296,288 $ (8,552,573) $ 22,743,715
========== =========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Debt $ 23,706,752 $ (9,799,994) $ 13,906,758
Accrued liabilities 1,305,950 (326,744) 979,206
Subscriber prepayments 210,106 (47,541) 162,565
---------- ----------- ----------
Total liabilities 25,222,808 (10,174,279) 15,048,529
---------- ----------- ----------
Partners' capital 6,073,480 1,621,706 7,695,186
---------- ----------- ----------
Total liabilities and partners' capital $ 31,296,288 $ (8,552,573) $ 22,743,715
========== =========== ==========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited balance sheet.
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JONES CABLE INCOME FUND 1-B/C VENTURE
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Nine Months Ended September 30, 1997
Pro Forma Pro Forma
As Reported Adjustments Balance
-------------- ------------ -----------
REVENUES $ 13,867,189 $ (4,487,598) $ 9,379,591
COSTS AND EXPENSES:
Operating expenses 7,799,531 (2,387,207) 5,412,324
Management fees and allocated overhead from
General Partner 1,521,950 (470,037) 1,051,913
Depreciation and amortization 4,042,491 (879,453) 3,163,038
---------- ----------- ----------
OPERATING INCOME (LOSS) 503,217 (750,901) (247,684)
---------- ----------- ----------
OTHER INCOME (EXPENSES):
Interest expense (1,047,954) 518,751 (529,203)
Gain on sale of cable television system 18,889,257 - 18,889,257
Other, net (90,841) (3,685) (94,526)
---------- ----------- ----------
Total other income (expense), net 17,750,462 515,066 18,265,528
---------- ----------- ----------
NET INCOME $ 18,253,679 $ (235,835) $ 18,017,844
========== =========== ==========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited statement.
12
JONES CABLE INCOME FUND 1-B/C VENTURE
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Year Ended December 31, 1996
Pro Forma Pro Forma
As Reported Adjustments Balance
-------------- ------------ -----------
REVENUES $ 24,624,270 $ (5,820,357) $ 18,803,913
COSTS AND EXPENSES:
Operating expenses 13,684,546 (3,080,758) 10,603,788
Management fees and allocated overhead from
General Partner 2,858,737 (668,833) 2,189,904
Depreciation and amortization 7,919,508 (1,675,065) 6,244,443
---------- ----------- ----------
OPERATING INCOME (LOSS) 161,479 (395,701) (234,222)
OTHER INCOME (EXPENSES):
Interest expense (3,110,571) 705,670 (2,404,901)
Other, net (31,000) 12,381 (18,619)
---------- ----------- ----------
Total other income (expense), net (3,141,571) 718,051 (2,423,520)
---------- ----------- ----------
NET LOSS $ (2,980,092) $ 322,350 $ (2,657,742)
========== =========== ==========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited statement.
13
JONES CABLE INCOME FUND 1-B/C VENTURE
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
1) The following calculations present the sale of the System and the
resulting estimated proceeds expected to be received by the Venture.
2) The unaudited pro forma balance sheet assumes that the Venture had sold
the System for $21,400,000 as of September 30, 1997. The unaudited statements
of operations assume that the Venture had sold the System as of January 1, 1996.
3) The estimated gain recognized from the sale of the System and
corresponding estimated distribution to limited partners as of September 30,
1997 has been computed as follows:
GAIN ON SALE OF ASSETS:
Contract sales price $ 21,400,000
Less: Net book value of investment in cable television
properties at September 30, 1997 8,243,294
----------
Gain on sale of assets $ 13,156,706
==========
DISTRIBUTIONS TO PARTNERS:
Contract sales price $ 21,400,000
Working capital adjustment:
Add: Current assets 279,343
Less: Current liabilities (374,285)
----------
Adjusted cash received by the Venture 21,305,058
Less: Repayment of outstanding debt to third parties (9,799,994)
Payment of brokerage fee (535,000)
Plus: Cash on hand 29,936
----------
Cash available for distribution $ 11,000,000
==========
Distribution to Fund 1-B $ 4,374,700
==========
Distribution to Fund 1-C $ 6,625,300
==========
4) The pro forma statements of operations reflect the sale of the System
and the repayment of approximately $9,799,994 of debt with proceeds of such
sale.
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