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): July 30, 1999
JONES CABLE INCOME FUND 1-B, LTD.
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(Exact name of registrant as specified in its charter)
Colorado 0-14906 84-1010417
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(State of Organization) (Commission File No.) (IRS Employer
Identification No.)
c/o Comcast Corporation, 1500 Market Street
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Philadelphia, Pennsylvania 19102-2148 (215) 665-1700
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(Address of principal executive office and Zip Code) (Registrant's
telephone no.
including area code)
Item 2. Acquisition or Disposition of Assets
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On July 30, 1999, the Jones Cable Income Fund 1-B/C Venture (the
"Venture"), in which Jones Cable Income Fund 1-B, Ltd. (the "Partnership") owns
a 40 percent interest and in which Jones Cable Income Fund 1-C, Ltd. ("Fund 1-
C") owns a 60 percent interest, sold the Myrtle Creek System to an unaffiliated
party for a sales price of $10,000,000, subject to customary closing
adjustments. This sale was approved by the holders of a majority of the
limited partnership interests in a vote conducted in June and July 1999. From
the sale proceeds, the Venture paid a $250,000 brokerage fee to The Intercable
Group, Ltd. ("The Intercable Group"), a subsidiary of Jones Intercable, Inc.,
representing 2.5 percent of the sales price, for acting as a broker in the
transaction, repaid the then outstanding balance of the Venture's credit
facility of $2,400,000, and deposited $500,000 into an interest-bearing
indemnity escrow account. The Venture will settle working capital adjustments
and, based upon financial information as of June 30, 1999, the remaining net
sale proceeds of approximately $6,500,000 will be distributed 40 percent to the
Partnership and 60 percent to Fund 1-C. The Partnership will receive
approximately $2,585,000 and Fund 1-C will receive approximately $3,915,000 of
such distribution. The Partnership, in turn, will create a reserve to cover the
administrative expenses of the Partnership and then it will distribute the
balance to the limited partners of the Partnership. This distribution is
expected to be made in the third quarter of 1999. Because this 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 limited partners' liquidation preference provided by the
Partnership's limited partnership agreement, the General Partner of the
Partnership will not receive a general partner distribution from the Myrtle
Creek System's sale proceeds.
For a period of one year following the closing date, $500,000 of the sale
proceeds will remain in escrow as security for the Venture's agreement to
indemnify the purchaser under the asset purchase agreement. The Venture's
primary exposure, if any, will relate to the representations and warranties made
about the Myrtle Creek System in the asset purchase agreement. Any amounts
remaining from this indemnity escrow account and not claimed by the buyer at the
end of the one-year escrow period plus interest earned on the escrowed funds
will be returned to the Venture. From this amount, the Venture will pay its
remaining liabilities and the Venture will then distribute the balance, if any,
to its partners. From its share of this distribution, the Partnership will
retain funds necessary to cover the administrative expenses of the Partnership
and it will distribute the balance, if any, to the limited partners.
Although the sale of the Myrtle Creek System represented the sale of the
only remaining operating asset of the Venture, and the Partnership's interest in
the Venture represents its only asset, the Venture and the Partnership will not
be dissolved until all proceeds from escrow have been distributed and the
Partnership will not be dissolved and liquidated until pending litigation in
which the Partnership is a named defendant has been resolved and terminated.
Item 7. Financial Statements and Exhibits.
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(a) Financial statements of businesses acquired.
Not applicable
(b) Pro forma financial information.
A description of the pro forma financial information of Jones Cable Income
Fund 1-B, Ltd. reflecting the sale of the Myrtle Creek System is attached.
(c) Exhibits.
Asset Purchase Agreement by and between Falcon Community Ventures I Limited
Partnership and Jones Cable Income Fund 1-B/C Venture dated as of September
9, 1998 is incorporated by reference from the Partnership's Form 8-K
Current Report dated September 9, 1998 to which it was attached as an
exhibit.
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 of the
undersigned hereunto duly authorized.
JONES CABLE INCOME FUND 1-B, LTD.,
a Colorado limited partnership
By: Jones Intercable, Inc.,
its general partner
Dated: August 16, 1999 By:_________________________________
Arthur R. Block
Vice President
(42478)
UNAUDITED PROFORMA FINANCIAL INFORMATION
OF JONES CABLE INCOME FUND 1-B, LTD.
The following unaudited pro forma balance sheet assumes that as of June 30,
1999, Jones Cable Income Fund 1-B/C Venture (the "Venture") had sold the cable
television system serving subscribers in and around Myrtle Creek, Oregon (the
"Myrtle Creek System") for $10,000,000. From the sale proceeds, the Venture paid
a $250,000 brokerage fee to The Intercable Group, Ltd. ("The Intercable Group"),
a subsidiary of Jones Intercable, Inc. (the "General Partner"), representing 2.5
percent of the sales price, for acting as a broker in the transaction, repaid
the outstanding balance on the Venture's credit facility of $2,400,000, and
deposited $500,000 into an interest-bearing indemnity escrow account. The
Venture will settle working capital adjustments and, based upon financial
information as of June 30, 1999, the remaining net sale proceeds of
approximately $6,500,000 will be distributed 40 percent to Jones Cable Income
Fund 1-B, Ltd. (the "Partnership") and 60 percent to Jones Cable Income Fund 1-
C, Ltd. ("Fund 1-C"). The Partnership will receive approximately $2,585,000 and
Fund 1-C will receive approximately $3,915,000 of such distribution. The
Partnership, in turn, will pay its remaining liabilities, which totaled $59,010
at June 30, 1999, and it will create a reserve of $300,000 to cover the
administrative expenses of the Partnership and then it will distribute the
balance to the limited partners of the Partnership. This distribution is
expected to be made in the third quarter of 1999. Because this 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 limited partners' liquidation preference provided by the
Partnership's limited partnership agreement, the General Partner of the
Partnership will not receive a general partner distribution from the Myrtle
Creek System's sale proceeds.
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 JUNE 30, 1999 AND CERTAIN ESTIMATES OF LIABILITIES AT
CLOSING. FINAL RESULTS MAY DIFFER FROM SUCH INFORMATION.
JONES CABLE INCOME FUND 1-B, LTD.
UNAUDITED PRO FORMA BALANCE SHEET
June 30, 1999
Pro Forma Pro Forma
As Reported Adjustments Balance
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ASSETS
Distribution Receivable from Joint Venture $ - $ 2,525,990 $ 2,525,990
Investment in Cable Television Join Venture 242,891 49,738 292,629
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Total Assets $ 242,891 $ 2,575,728 $ 2,818,619
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LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued liabilities $ 59,010 $ (59,010) $ -
Accrued distribution to limited partners - 2,225,990 2,225,990
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Total Liabilities 59,010 2,166,980 2,225,990
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Partners' Capital:
General Partner 1,532 (1,532) -
Limited Partners 182,349 410,280 592,629
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Total Partners' Capital 183,881 408,748 592,629
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Total Liabilities and Partners' Capital $ 242,891 $ 2,575,728 $ 2,818,619
======= =========== =========
The accompanying notes to unaudited pro forma financial statements are
an integral part of this unaudited pro forma balance sheet.
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JONES CABLE INCOME FUND 1-B, LTD.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1999
Pro Forma Pro Forma
As Reported Adjustments Balance
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OTHER EXPENSE $ (5,813) $ 5,813 $ -
EQUITY IN NET INCOME OF CABLE
TELEVISON JOINT VENTURE 159,012 (159,012) -
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NET INCOME $ 153,199 $(153,199) $ -
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NET INCOME PER LIMITED
PARTNERSHIP INTEREST $ 1.81 $ -
========= =========
The accompanying notes to unaudited pro forma financial statements arean
integral part of this unaudited pro forma statement.
JONES CABLE INCOME FUND 1-B, LTD.
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UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Year Ended December 31, 1998
Pro Forma Pro Forma
As Reported Adjustments Balance
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OTHER EXPENSE $ (53,342) $ 53,342 $ -
EQUITY IN NET INCOME OF CABLE
TELEVISON JOINT VENTURE 13,657,749 (13,657,749) -
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NET INCOME $13,604,407 $(13,604,407) $ -
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NET INCOME PER LIMITED
PARTNERSHIP INTEREST $ 162.13 $ -
=========== =========
The accompanying notes to unaudited pro forma financial statements arean
integral part of this unaudited pro forma statement.
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JONES CABLE INCOME FUND 1-B, LTD.
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
1) The following calculations present the sale of the Myrtle Creek 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 Myrtle Creek System as of June 30, 1999. The unaudited pro forma
statements of operations of the Partnership assumes that the Venture had sold
the Myrtle Creek System, the Clearlake System, the Southwestern Michigan System
and the South Sioux City System as of January 1, 1998.
3) From the $10,000,000 sale proceeds, the Venture paid a $250,000
brokerage fee to The Intercable Group, representing 2.5 percent of the sales
price, for acting as a broker in the transaction, repaid the outstanding balance
on the Venture's credit facility of $2,400,000, and deposited $500,000 into an
interest-bearing indemnity escrow account. The Venture will settle working
capital adjustments and, based upon financial information as of June 30, 1999,
the remaining net sale proceeds of approximately $6,500,000 will be distributed
40 percent to the Partnership and 60 percent to Fund 1-C. The Partnership will
receive approximately $2,585,000 and Fund 1-C will receive approximately
$3,915,000 of such distribution. The Partnership, in turn, will pay its
remaining liabilities, which totaled $59,010 at June 30, 1999, and it will
create a reserve of $300,000 to cover the administrative expenses of the
Partnership and then it will distribute the balance to the limited partners of
the Partnership. This distribution is expected to be made in the third quarter
of 1999. Because this 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 limited
partners' liquidation preference provided by the Partnership's limited
partnership agreement, the General Partner of the Partnership will not receive a
general partner distribution from the Myrtle Creek System's sale proceeds.
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4) The estimated gain recognized from the sale of the Myrtle Creek System
by the Venture and corresponding estimated distribution to Venture partners as
of June 30, 1999 has been computed as follows:
Gain on Sale of Assets:
Contract sales price $10,000,000
Less: Net book value of investment in cable television properties
at June 30, 1999 (3,020,372)
Brokerage Fee to The Intercable Group (250,000)
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Gain on sale of assets $ 6,729,628
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Distributions to Venture Partners:
Contract sales price $10,000,000
Working capital adjustment:
Add: Trade receivable, net 8,460
Prepaid expenses 95,253
Less: Accrued liabilities (289,390)
Subscriber prepayments (35,844)
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Adjusted cash received 9,778,479
Add: Cash on hand 117,712
Less: Outstanding debt to third parties (2,410,376)
Brokerage fee (250,000)
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Cash available from sale proceeds 7,235,815
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Portion of sale proceeds to be held in indemnity escrow (500,000)
Estimated reserve for on-going Partnership costs (235,815)
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Cash available for distribution by the Venture $ 6,500,000
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Cash available for distribution by the Partnership $ 2,585,000
===========
Cash available for distribution by Fund 1-C $ 3,915,000
===========
5) The estimated distribution to the Partnership's limited partners as
of June 30, 1999 has be computed as follows:
Cash Distribution from Venture $ 2,585,000
Less: Accrued Liabilities (59,010)
Reserve for Administrative Costs (300,000)
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Distribution to Limited Partners $ 2,225,990
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