Back to GetFilings.com
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from__________to___________
Commission file number: 0-14206
CABLE TV FUND 12-D, LTD.
(Exact name of registrant as specified in its charter)
Colorado 84-1010423
-------- ----------
(State of Organization) (IRS Employer Identification No.)
c/o Comcast Corporation, 1500 Market Street,
- --------------------------------------------
Philadelphia, Pennsylvania 19102-2148 (215) 665-1700
- -------------------------------------------- --------------
(Address of principal executive office and (Registrant's telephone no.
Zip Code) including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Limited Partnership Interests
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
registrants were required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days:
Yes x No
------ ------
Aggregate market value of the voting stock held by non-affiliates of the
registrant: [Not Applicable]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (ss.229.405) is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. _______
DOCUMENTS INCORPORATED BY REFERENCE: None
(50070)
This Annual Report on Form 10-K is for the year ending December 31,
1999. This Annual Report modifies and supersedes documents filed by the
Partnership prior to the filing of this Annual Report. The Securities and
Exchange Commission (the "SEC") allows the Partnership to "incorporate by
reference" into this Annual Report information that it files with the SEC, which
means that the Partnership can disclose important information to limited
partners by referring them directly to those documents. Information incorporated
by reference is considered to be part of this Annual Report. In addition,
information that the Partnership files with the SEC in the future will
automatically update and supersede information contained in this Annual Report.
Certain information contained in this Annual Report contains "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. All statements, other than statements of historical facts, included in
this Annual Report that address activities, events or developments that the
Partnership or the General Partner expects, believes or anticipates will or may
occur in the future are forward-looking statements. These forward-looking
statements are based upon certain assumptions and are subject to risks and
uncertainties. Actual events or results may differ from those discussed in the
forward-looking statements as a result of various factors.
PART I.
-------
ITEM 1. BUSINESS
----------------
THE PARTNERSHIP. Cable TV Fund 12-D, Ltd. (the "Partnership") is a
Colorado limited partnership that was formed pursuant to the public offering of
limited partnership interests in the Cable TV Fund 12 Limited Partnership
Program (the "Program"). Comcast JOIN Holdings, Inc., a Delaware corporation, is
the general partner of the Partnership (the "General Partner"). Cable TV Fund
12-B, Ltd. ("Fund 12-B") and Cable TV Fund 12-C, Ltd. ("Fund 12-C") are other
partnerships that were formed pursuant to the Program. In 1986, the Partnership,
Fund 12-B and Fund 12-C formed a general partnership known as Cable TV Fund
12-BCD Venture (the "Venture"), in which the Partnership owns a 76% interest,
Fund 12-B owns a 9% interest and Fund 12-C owns a 15% interest. The Partnership
and the Venture were formed for the purpose of acquiring and operating cable
television systems. The Partnership does not own any cable television systems.
The Partnership's sole asset is its 76% interest in the Venture. Following the
disposition in December 1998 of its only remaining operating asset, the cable
television system serving Palmdale, California (the "Palmdale System"), the
Venture no longer owns any cable television systems. Although the Partnership
and the Venture no longer own any cable television systems, the Partnership and
the Venture will not be dissolved until after all pending litigation relating to
the Partnership and the Venture has been resolved and terminated.
Because transferees of limited partnership interests following the
record date for the distribution of the Palmdale System's sale proceeds
(December 31, 1998) would not be entitled to any distributions from the
Partnership, a transfer of limited partnership interests following such record
date would have no economic value. The General Partner therefore has determined
that, pursuant to the authority granted to it by the Partnership's limited
partnership agreement, the General Partner will approve no transfers of limited
partnership interests after December 31, 1998.
NEW GENERAL PARTNER. On April 7, 1999, Comcast Corporation ("Comcast")
completed the acquisition of a controlling interest in Jones Intercable, Inc.
("Jones Intercable"), the Partnership's general partner until March 2, 2000, as
discussed below. As of December 31, 1999, Comcast owned approximately 2.9
million shares of Jones Intercable's Common Stock and approximately 13.8 million
shares of Jones Intercable's Class A Common Stock, representing 39.6% of the
economic interest and 48.3% of the voting interest in Jones Intercable. Comcast
contributed its shares in Jones Intercable to its wholly owned subsidiary,
Comcast Cable Communications, Inc. ("Comcast Cable"). The approximately 2.9
million shares of Common Stock of Jones Intercable owned by Comcast Cable
represented shares having the right to elect approximately 75% of the Board of
Directors of Jones Intercable. As of April 7, 1999, Jones Intercable became a
consolidated public company subsidiary of Comcast Cable.
In connection with Comcast's acquisition of a controlling interest in
Jones Intercable on April 7, 1999, all of the persons who were executive
officers of Jones Intercable as of that date terminated their employment with
2
Jones Intercable. Also on that date, Jones Intercable's Board of Directors
elected new executive officers, each of whom also was an officer of Comcast.
Effective April 7, 1999, Jones Intercable and Comcast entered into a management
agreement pursuant to which employees of Comcast have undertaken the
administration of the Partnership. As of July 7, 1999, all persons who were
employed at Jones Intercable's former corporate offices in Englewood, Colorado
had terminated their employment with Jones Intercable.
In December 1999, Comcast and Jones Intercable entered into a
definitive merger agreement pursuant to which Comcast agreed to acquire all of
the outstanding shares of Jones Intercable not yet owned by Comcast. On March 2,
2000, Jones Intercable was merged into Comcast JOIN Holdings, Inc., a wholly
owned subsidiary of Comcast. Comcast JOIN Holdings, Inc. continues as the
surviving corporation of the merger. As a result of this transaction, Jones
Intercable no longer exists and Comcast JOIN Holdings, Inc. is now the general
partner of the Partnership. References in this Annual Report to "the General
Partner" refer to Comcast JOIN Holdings, Inc. The General Partner shares
corporate offices with Comcast at 1500 Market Street, Philadelphia, Pennsylvania
19102-2148.
ITEM 2. PROPERTIES
------------------
As of December 31, 1999, neither the Partnership nor the Venture own
any cable television systems.
ITEM 3. LEGAL PROCEEDINGS
-------------------------
LITIGATION CHALLENGING JONES INTERCABLE'S ACQUISITION OF THE TAMPA SYSTEM
Jones Intercable was a defendant in a consolidated civil action filed
by limited partners of the Partnership captioned David Hirsch, Marty, Inc.
-------------------------
Pension Plan (by its trustee and beneficiary, Martin Ury) and Jonathan and
- --------------------------------------------------------------------------
Eileen Fussner, derivatively on behalf of Cable TV Fund 12-B, Ltd., Cable TV
- ----------------------------------------------------------------------------
Fund 12-C, Ltd. and Cable TV Fund 12-D, Ltd., plaintiffs v. Jones Intercable,
- -----------------------------------------------------------------------------
Inc., defendant, and Cable TV Fund 12-BCD Venture, Cable TV Fund 12-B, Ltd.,
- ----------------------------------------------------------------------------
Cable TV Fund 12-C, Ltd. and Cable TV Fund 12-D, Ltd., nominal defendants
- -------------------------------------------------------------------------
(District Court, Arapahoe County, State of Colorado, Case No. 95-CV-1800,
Division 3). The consolidated complaint generally alleged that Jones Intercable
breached its fiduciary duty to the plaintiffs and to the other limited partners
of the three named partnerships and to the Venture in connection with the
Venture's sale of the Tampa, Florida cable television system (the "Tampa
System") to a subsidiary of Jones Intercable and the subsequent trade of the
Tampa System and other cable systems owned by Jones Intercable in exchange for
cable television systems owned by an unaffiliated cable system operator. The
consolidated complaint also set forth a claim for breach of contract and a claim
for breach of the implied covenant of good faith and fair dealing. Among other
things, the plaintiffs asserted that the subsidiary of Jones Intercable that
acquired the Tampa System paid an inadequate price for it. The price paid for
the Tampa System was determined by the average of three separate, independent
appraisals of the Tampa System's fair market value as required by the terms of
the limited partnership agreements of the three named partnerships. The
plaintiffs also challenged the adequacy and independence of the appraisals. The
consolidated complaint sought compensatory damages, an award of attorneys' fees,
punitive damages and certain equitable relief. On October 25, 1999, the district
court granted Jones Intercable's motion to dismiss and for summary judgment
based upon the August 1998 report of independent counsel, which had concluded
that the plaintiffs' claims were not meritorious and were not supported by a
preponderance of the evidence. The plaintiffs gave notice of their intention to
appeal the district court's decision, but in return for Jones Intercable's
settlement offer to pay a portion of the plaintiffs' attorneys' costs in the
amount of approximately $229,000, the plaintiffs voluntarily dismissed their
appeal and this litigation has been finally terminated and resolved.
LITIGATION CHALLENGING JONES INTERCABLE'S ACQUISITIONS OF THE ALBUQUERQUE
AND PALMDALE SYSTEMS
In June 1999, Jones Intercable was named a defendant in a case
captioned City Partnership Co., derivatively on behalf of Cable TV Fund 12-C,
-------------------------------------------------------------------
Ltd., Cable TV Fund 12-D, Ltd. and Cable TV Fund 12-BCD Venture, plaintiff v.
- -----------------------------------------------------------------------------
Jones Intercable, Inc., defendant and Cable TV Fund 12-C, Ltd., Cable TV Fund
- -----------------------------------------------------------------------------
12-D, Ltd.
3
and Cable TV Fund 12-BCD Venture, nominal defendants (U.S. District Court,
- ----------------------------------------------------
District of Colorado, Civil Action No. 99-WM-1155) brought by City Partnership
Co., a limited partner of the named partnerships. The plaintiff's complaint
alleges that Jones Intercable breached its fiduciary duty to the plaintiff and
to the other limited partners of the partnerships and to the Venture in
connection with the Venture's sale of the Palmdale, California cable television
system (the "Palmdale System") to a subsidiary of Jones Intercable in December
1998. The complaint alleges that Jones Intercable acquired the Palmdale System
at an unfairly low price that did not accurately reflect the market value of the
Palmdale System. The plaintiff also alleges that the proxy solicitation
materials delivered to the limited partners of the partnerships in connection
with the votes of the limited partners on the Venture's sale of the Palmdale
System contained inadequate and misleading information concerning the fairness
of the transaction, which the plaintiff claims caused Jones Intercable to breach
its fiduciary duty of candor to the limited partners and which the plaintiff
claims constituted acts and omissions in violation of Section 14(a) of the
Securities Exchange Act of 1934, as amended. Plaintiff also claims that Jones
Intercable breached the contractual provision of the partnerships' limited
partnership agreements requiring that the sale price be determined by the
average of three separate, independent appraisals, challenging both the
independence and the currency of the appraisals. The complaint finally seeks
declaratory injunctive relief to prevent Jones Intercable from making use of the
partnerships' funds to finance Jones Intercable's defense of this litigation.
Jones Intercable has filed motions to dismiss certain of the plaintiff's claims
for relief. The General Partner believes that the procedures followed by Jones
Intercable in conducting the votes of the limited partners of the partnerships
on the sale of the Palmdale System, including the fairness opinion in the proxy
statements delivered to the limited partners of the partnerships, were proper
and that the Venture's sale of the Palmdale System at a price determined by
averaging three separate, independent appraisals was in accordance with the
express provisions of the partnerships' limited partnership agreements. The
General Partner intends to defend this lawsuit vigorously.
In August 1999, Jones Intercable was named a defendant in a case
captioned Gramercy Park Investments, LP, Cobble Hill Investments, LP and
--------------------------------------------------------------
Madison/AG Partnership Value Partners II, plaintiffs v. Jones Intercable, Inc.
- ------------------------------------------------------------------------------
and Glenn R. Jones, defendants, and Cable TV Fund 12-B, Ltd., Cable TV Fund
- ---------------------------------------------------------------------------
12-C, Ltd., Cable TV Fund 12-D, Ltd., Cable TV Fund 14-A, Ltd. and Cable TV Fund
- --------------------------------------------------------------------------------
14-B, Ltd., nominal defendants (U.S. District Court, District of Colorado, Civil
- ------------------------------
Action No. 99-B-1508)("Gramercy Park") brought as a class and derivative action
by limited partners of the named partnerships. The plaintiffs' complaint alleges
that the defendants made false and misleading statements to the limited partners
of the named partnerships in connection with the solicitation of proxies and the
votes of the limited partners on the sales of the Albuquerque, Palmdale,
Littlerock and Calvert County cable communication systems by the named
partnerships to Jones Intercable or one of its subsidiaries in violation of
Sections 14 and 20 of the Securities Exchange Act of 1934, as amended. The
plaintiffs specifically allege that the proxy statements delivered to the
limited partners in connection with the limited partners' votes on these sales
were false, misleading and failed to disclose material facts necessary to make
the statements made not misleading. The plaintiffs' complaint also alleges that
the defendants breached their fiduciary duties to the plaintiffs and to the
other limited partners of the named partnerships and to the named partnerships
in connection with the various sales of the Albuquerque, Palmdale, Littlerock
and Calvert County cable communications systems to subsidiaries of Jones
Intercable. The complaint alleges that Jones Intercable acquired these cable
communications systems at unfairly low prices that did not accurately reflect
the market values of the systems. The plaintiffs seek on their own behalf and on
behalf of all other limited partners compensatory and nominal damages, the costs
and expenses of the litigation, including reasonable attorneys' and experts'
fees, and punitive and exemplary damages.
In September 1999, Jones Intercable was named a defendant in a case
captioned Mary Schumacher, Charles McKenzie and Geraldine Lucas, plaintiffs v.
--------------------------------------------------------------------
Jones Intercable, Inc. and Glenn R. Jones, defendants and Cable TV Fund 12-B,
- -----------------------------------------------------------------------------
Ltd., Cable TV Fund 12-C, Ltd., Cable TV Fund 12-D, Ltd., Cable TV Fund 14-A,
- -----------------------------------------------------------------------------
Ltd. and Cable TV Fund 14-B, Ltd., nominal defendants (U.S. District Court,
- -----------------------------------------------------
District of Colorado, Civil Action No. 99-WM-1702)("Schumacher") brought as a
class and derivative action by three limited partners of the named partnerships.
The substance of the plaintiffs' complaint is similar to the allegations raised
in the Gramercy Park case.
-------------
In September 1999, Jones Intercable was named a defendant in a case
captioned Robert Margolin, Henry Wahlgren and Joan Wahlgren, plaintiffs v. Jones
----------------------------------------------------------------------
Intercable, Inc. and Glenn R. Jones, defendants and Cable TV
- ------------------------------------------------------------
4
Fund 12-B, Ltd., Cable TV Fund 12-C, Ltd., Cable TV Fund 12-D, Ltd., Cable TV
- -----------------------------------------------------------------------------
Fund 14-A, Ltd. and Cable TV Fund 14-B, Ltd., nominal defendants (U.S. District
- ----------------------------------------------------------------
Court, District of Colorado, Civil Action No. 99-B-1778)("Margolin") brought as
a class and derivative action by three limited partners of the named
partnerships. The substance of the plaintiffs' complaint is similar to the
allegations raised in the Gramercy Park case.
-------------
The General Partner believes that the procedures followed by Jones
Intercable in conducting the votes of the limited partners of the various
partnerships on the sales of the Albuquerque, Palmdale, Littlerock and Calvert
County systems and the disclosures in the proxy statements delivered to the
limited partners in connection with the limited partners' votes on these sales
were proper and complete, and the General Partner believes that the various sale
transactions were fair because they were at prices determined by averaging three
separate, independent appraisals of the various cable communications systems
sold in accordance with the express provisions of the partnerships' limited
partnership agreements. The General Partner intends to defend these lawsuits
vigorously.
In November 1999, the United States District Court for the District of
Colorado entered an order consolidating all of the cases challenging Jones
Intercable's acquisitions of the Albuquerque, Palmdale, Littlerock and Calvert
County systems because these cases involve common questions of law and fact.
LITIGATION RELATING TO LIMITED PARTNERSHIP LIST REQUESTS
In July 1999, Jones Intercable, each of its subsidiaries that serve as
general partners of Jones Intercable's managed partnerships and most of Jones
Intercable's managed partnerships, including the Partnership, were named
defendants in a case captioned Everest Cable Investors, LLC, Everest Properties,
-------------------------------------------------
LLC, Everest Properties II, LLC and KM Investments, LLC, plaintiffs v. Jones
- ----------------------------------------------------------------------------
Intercable, Inc., et al., defendants (Superior Court, Los Angeles County, State
- ------------------------------------
of California, Case No. BC 213632).
Plaintiffs allege that certain of them formed a plan to acquire up to
4.9% of the limited partnership interests in each of the managed partnerships
named as defendants, and that plaintiffs were frustrated in this purpose by
Jones Intercable's alleged refusal to provide plaintiffs with lists of the names
and addresses of the limited partners of these partnerships. The complaint
alleges that Jones Intercable's actions constituted a breach of contract, a
breach of Jones Intercable's implied covenant of good faith and fair dealing
owed to the plaintiffs as limited partners, a breach of Jones Intercable's
fiduciary duty owed to the plaintiffs as limited partners and tortious
interference with prospective economic advantage. Plaintiffs allege that Jones
Intercable's failure to provide them with the partnership lists prevented them
from making their tender offers and that they have been injured by such action
in an amount to be proved at trial, but not less than $17 million.
In September 1999, Jones Intercable and the defendant subsidiaries and
managed partnerships filed a notice of demurrers to the plaintiffs' complaint
and a hearing on this matter was held in October 1999. In December 1999, the
Court sustained the defendants' demurrers in part but the Court gave the
plaintiffs leave to amend their complaint to attempt to cure the deficiencies in
the pleadings. The plaintiffs filed their first amended complaint in January
2000.
Discovery in the case also has begun, and Jones Intercable and the
defendant subsidiaries and managed partnerships have responded to the
plaintiffs' first set of interrogatories and the plaintiffs' first demand for
the production of documents. The General Partner believes that the defendants
have defenses to the plaintiffs' claims for relief and challenges to the
plaintiffs' claims for damages, and the General Partner intends to defend this
lawsuit vigorously.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
5
PART II.
--------
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK
------------------------------------------------
AND RELATED SECURITY HOLDER MATTERS
-----------------------------------
While the Partnership is publicly held, there is no public market for
the limited partnership interests, and it is not expected that a market will
develop in the future. As of December 31, 1999, the number of equity security
holders in the Partnership was 16,383.
6
ITEM 6. SELECTED FINANCIAL DATA
For the Year Ended December 31,
-----------------------------------------------------------------------------------------
Cable TV Fund 12-D, Ltd.(a) 1999 1998 1997 1996 1995
------------- ------------- ------------- ------------- -------------
Revenues $ -- $ 59,492,754 $ 82,675,018 $ 82,363,752 $ 101,399,697
Depreciation and Amortization -- 16,500,689 21,837,251 22,142,809 26,666,735
Operating Income -- 3,924,809 6,129,688 1,880,308 4,127,622
Minority Interest in Consolidated
(Income) Loss 25,706 (59,864,240) 1,173,555 (15,248,079) 2,720,847
Net Income (Loss) (79,388) 183,858,739(c) (3,624,693) 47,090,757(b) (8,403,720)
Net Income (Loss) per Limited
Partnership Unit (.25) 683.15(c) (15.12) 193.47(b) (35.05)
Weighted Average Number of Limited
Partnership Units Outstanding 237,339 237,339 237,339 237,339 237,339
General Partner's Capital (Deficit) 439,501 459,348 (108,581) (72,334) (1,244,562)
Limited Partners' Capital (Deficit) 1,318,496 1,378,037 (20,175,212) (16,586,766) (20,958,295)
Total Assets 2,327,155 69,325,751 124,269,504 120,899,336 163,486,029
Debt -- -- 144,308,462 138,345,878 180,770,267
General Partner Advances -- -- -- -- 4,198,739
(a) The above financial information represents the consolidated operations of
Cable TV Fund 12-D, Ltd., including Cable TV Fund 12-BCD Venture, in which
Cable TV Fund 12-D, Ltd. has a 76 percent equity interest.
(b) Net income resulted primarily from the sale of the Tampa System by Cable TV
Fund 12-BCD Venture in February 1996.
(c) Net income resulted primarily from the sales of the Albuquerque System and
the Palmdale System by Cable TV Fund 12-BCD Venture in June 1998 and
December 1998, respectively.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion contains, in addition to historical
information, forward-looking statements that are based upon certain assumptions
and are subject to a number of risks and uncertainties.
FINANCIAL CONDITION
Cable TV Fund 12-D, Ltd.
The Partnership's investment in the Venture decreased $79,388 for the
year ended December 31, 1999, which represents the Partnership's share of losses
generated by the Venture.
Cable TV Fund 12-BCD Venture
The Venture sold the Albuquerque System and the Palmdale System to a
subsidiary of Jones Intercable in 1998. Although the sale of the Palmdale System
represented the sale of the only remaining operating asset of the Venture, the
Venture and the Partnership will not be dissolved until after all pending
litigation relating to the Venture and the Partnership has been resolved and
terminated.
RESULTS OF OPERATIONS
The Partnership conducted no operations in 1999; therefore, a
discussion of results of operations would not be meaningful. Other expense
incurred by the Venture of $105,094 in 1999 primarily related to various costs
associated with the sale of the Venture's systems and the administration of the
Venture and its constituent partnerships.
ITEM 8. FINANCIAL STATEMENTS
The audited financial statements of the Partnership and the Venture for
the year ended December 31, 1999 follow.
7
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
----------------------------------------
To the Partners of Cable TV Fund 12-D, Ltd.:
We have audited the accompanying consolidated balance sheets of CABLE
TV FUND 12-D, LTD. (a Colorado limited partnership) and subsidiary as of
December 31, 1999 and 1998, and the related consolidated statements of
operations, partners' capital (deficit) and cash flows for each of the three
years in the period ended December 31, 1999. These financial statements are the
responsibility of the general partner's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Cable TV Fund 12-D,
Ltd. and subsidiary as of December 31, 1999 and 1998, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 1999, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Denver, Colorado,
March 3, 2000.
8
CABLE TV FUND 12-D, LTD.
(A Limited Partnership)
CONSOLIDATED BALANCE SHEETS
December 31,
------------------------------
ASSETS 1999 1998
------ ------------- -------------
CASH AND CASH EQUIVALENTS $ 302 $ 69,325,751
RECEIVABLE FROM GENERAL PARTNER 2,326,853 --
------------- -------------
Total assets $ 2,327,155 $ 69,325,751
============= =============
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES:
Accounts payable and accrued liabilities $ -- $ 67,751
Accrued distributions -- 66,825,751
------------- -------------
Total liabilities -- 66,893,502
------------- -------------
COMMITMENTS AND CONTINGENCIES (Note 5)
MINORITY INTEREST IN JOINT VENTURE 569,158 594,864
------------- -------------
PARTNERS' CAPITAL:
General Partner-
Contributed capital 1,000 1,000
Accumulated earnings 21,592,266 21,612,113
Distributions (21,153,765) (21,153,765)
------------- -------------
439,501 459,348
------------- -------------
Limited Partners-
Net contributed capital (237,339 units outstanding
at December 31, 1999 and 1998) 102,198,175 102,198,175
Accumulated earnings 81,251,117 81,310,658
Distributions (182,130,796) (182,130,796)
------------- -------------
1,318,496 1,378,037
------------- -------------
Total liabilities and partners' capital $ 2,327,155 $ 69,325,751
============= =============
The accompanying notes to consolidated financial statements
are an integral part of these consolidated balance sheets.
9
CABLE TV FUND 12-D, LTD.
------------------------
(A Limited Partnership)
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
For the Year Ended December 31,
-----------------------------------------------
1999 1998 1997
------------- ------------- -------------
REVENUES $ -- $ 59,492,754 $ 82,675,018
COSTS AND EXPENSES:
Operating expenses -- 32,547,366 45,958,487
Management fees and allocated overhead from
Jones Intercable, Inc. -- 6,519,890 8,749,592
Depreciation and amortization -- 16,500,689 21,837,251
------------- ------------- -------------
OPERATING INCOME -- 3,924,809 6,129,688
------------- ------------- -------------
OTHER INCOME (EXPENSE):
Interest expense -- (7,031,582) (10,934,909)
Gain on sales of cable television systems -- 248,449,739 --
Other, net (105,094) (1,619,987) 6,973
------------- ------------- -------------
Total other income (expense), net (105,094) 239,798,170 (10,927,936)
------------- ------------- -------------
CONSOLIDATED NET INCOME (LOSS) (105,094) 243,722,979 (4,798,248)
MINORITY INTEREST IN CONSOLIDATED NET
(INCOME) LOSS 25,706 (59,864,240) 1,173,555
------------- ------------- -------------
NET INCOME (LOSS) $ (79,388) $ 183,858,739 $ (3,624,693)
============= ============= =============
ALLOCATION OF NET INCOME (LOSS):
General Partner $ (19,847) $ 21,721,694 $ (36,247)
============= ============= =============
Limited Partners $ (59,541) $ 162,137,045 $ (3,588,446)
============= ============= =============
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT $ (.25) $ 683.15 $ (15.12)
============= ============= =============
WEIGHTED AVERAGE NUMBER OF LIMITED
PARTNERSHIP UNITS OUTSTANDING 237,339 237,339 237,339
============= ============= =============
The accompanying notes to consolidated financial statements
are an integral part of these consolidated statements.
10
CABLE TV FUND 12-D, LTD.
(A Limited Partnership)
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
For the Year Ended December 31,
-----------------------------------------------
1999 1998 1997
------------- ------------- -------------
GENERAL PARTNER:
Balance, beginning of year $ 459,348 $ (108,581) $ (72,334)
Net income (loss) for year (19,847) 21,721,694 (36,247)
Distributions -- (21,153,765) --
------------- ------------- -------------
Balance, end of year $ 439,501 $ 459,348 $ (108,581)
============= ============= =============
LIMITED PARTNERS:
Balance, beginning of year $ 1,378,037 $ (20,175,212) $ (16,586,766)
Net income (loss) for year (59,541) 162,137,045 (3,588,446)
Distributions -- (140,583,796) --
------------- ------------- -------------
Balance, end of year $ 1,318,496 $ 1,378,037 $ (20,175,212)
============= ============= =============
The accompanying notes to consolidated financial statements
are an integral part of these consolidated statements.
11
CABLE TV FUND 12-D, LTD.
(A Limited Partnership)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Year Ended December 31,
-----------------------------------------------
1999 1998 1997
------------- ------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (79,388) $ 183,858,739 $ (3,624,693)
Adjustments to reconcile net income (loss) to net cash provided by (used in)
operating activities:
Depreciation and amortization -- 16,500,689 21,837,251
Gain on sales of cable television systems -- (248,449,739) --
Minority interest in consolidated income (loss) (25,706) 59,864,240 (1,173,555)
Decrease (increase) in trade receivables -- 4,456,904 (1,780,658)
Increase in receivable from Jones Intercable (2,326,853) -- --
Decrease (increase) in deposits, prepaid expenses and
deferred charges -- 1,625,590 (3,332,261)
Increase (decrease) in accounts payable and
accrued liabilities and subscriber prepayments (67,751) (7,083,021) 2,205,832
------------- ------------- -------------
Net cash provided by (used in) operating
activities (2,499,698) 10,773,402 14,131,916
------------- ------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net -- (12,774,851) (19,866,829)
Proceeds from sales of cable television systems -- 361,168,467 --
------------- ------------- -------------
Net cash provided by (used in)
investing activities -- 348,393,616 (19,866,829)
------------- ------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings -- 12,236,298 15,551,159
Repayment of debt -- (156,544,760) (9,588,575)
Distributions to Limited Partners (50,481,940) (90,101,856) --
Distributions to General Partner -- (21,153,765) --
Distributions to Joint Venture Partners (16,343,811) (36,019,628) --
------------- ------------- -------------
Net cash provided by (used in)
financing activities (66,825,751) (291,583,711) 5,962,584
------------- ------------- -------------
Increase (decrease) in cash and cash equivalents (69,325,449) 67,583,307 227,671
Cash and cash equivalents, beginning of year 69,325,751 1,742,444 1,514,773
------------- ------------- -------------
Cash and cash equivalents, end of year $ 302 $ 69,325,751 $ 1,742,444
============= ============= =============
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ -- $ 9,296,224 $ 10,776,074
============= ============= =============
NON-CASH TRANSACTIONS:
Accrued distributions $ -- $ 66,825,751 $ --
============= ============= =============
The accompanying notes to consolidated financial statements
are an integral part of these consolidated statements.
12
CABLE TV FUND 12-D, LTD.
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) ORGANIZATION AND PARTNERS' INTERESTS
Formation and Business
Cable TV Fund 12-D, Ltd. ("Fund 12-D" or the "Partnership"), a Colorado
limited partnership, was formed on February 5, 1986, under a public program
sponsored by Jones Intercable, Inc. ("Jones Intercable"). Fund 12-D was formed
to acquire, construct, develop and operate cable television systems.
Formation of Joint Venture
On March 17, 1986, Cable TV Fund 12-B, Ltd. ("Fund 12-B"), Cable TV
Fund 12-C, Ltd. ("Fund 12-C") and Fund 12-D (collectively, the "Venture
Partners") formed Cable TV Fund 12-BCD Venture (the "Venture"). The Venture was
formed for the purpose of acquiring certain cable television systems. The
Venture owned the cable television systems serving Tampa, Florida (the "Tampa
System"), Albuquerque, New Mexico (the "Albuquerque System") and Palmdale,
California (the "Palmdale System").
New General Partner
On April 7, 1999, Comcast Corporation ("Comcast") completed the
acquisition of a controlling interest in Jones Intercable, the Partnership's
general partner until March 2, 2000, as discussed below. As of December 31,
1999, Comcast owned approximately 2.9 million shares of Jones Intercable's
Common Stock and approximately 13.8 million shares of Jones Intercable's Class A
Common Stock, representing 39.6% of the economic interest and 48.3% of the
voting interest in Jones Intercable. Comcast contributed its shares in Jones
Intercable to its wholly owned subsidiary, Comcast Cable Communications, Inc.
("Comcast Cable"). The approximately 2.9 million shares of Common Stock of Jones
Intercable owned by Comcast Cable represented shares having the right to elect
approximately 75% of the Board of Directors of Jones Intercable. As of April 7,
1999, Jones Intercable became a consolidated public company subsidiary of
Comcast Cable.
In connection with Comcast's acquisition of a controlling interest in
Jones Intercable on April 7, 1999, all of the persons who were executive
officers of Jones Intercable as of that date terminated their employment with
Jones Intercable. Also on that date, Jones Intercable's Board of Directors
elected new executive officers, each of whom also was an officer of Comcast.
Effective April 7, 1999, Jones Intercable and Comcast entered into a management
agreement pursuant to which employees of Comcast have undertaken the
administration of the Partnership. As of July 7, 1999, all persons who were
employed at Jones Intercable's former corporate offices in Englewood, Colorado
had terminated their employment with Jones Intercable.
In December 1999, Comcast and Jones Intercable entered into a
definitive merger agreement pursuant to which Comcast agreed to acquire all of
the outstanding shares of Jones Intercable not yet owned by Comcast. On March 2,
2000, Jones Intercable was merged into Comcast JOIN Holdings, Inc., a wholly
owned subsidiary of Comcast. Comcast JOIN Holdings, Inc. continues as the
surviving corporation of the merger. As a result of this transaction, Jones
Intercable no longer exists and Comcast JOIN Holdings, Inc. is now the general
partner of the Partnership. References in this annual report to "the General
Partner" refer to Comcast JOIN Holdings, Inc. Comcast JOIN Holdings, Inc. shares
corporate offices with Comcast at 1500 Market Street, Philadelphia, Pennsylvania
19102-2148.
Cable Television System Sales
On June 30, 1998, the Venture sold the Albuquerque System to a
subsidiary of Jones Intercable. The sales price of the Albuquerque System was
$222,963,267. This sales price represented the average of three separate
independent appraisals of the fair market value of the Albuquerque System. Upon
the sale of the Albuquerque System, the Venture repaid its outstanding Senior
Notes balance of $41,544,890 plus accrued interest, plus a make whole premium of
$1,332,823 and, as permitted by an amendment to the Venture's credit facility,
the Venture distributed $125,000,000 to
13
the three constituent partnerships of the Venture in proportion to their
ownership interests in the Venture. The remaining proceeds were used to repay a
portion of the outstanding balance and accrued interest on its credit facility.
The Partnership received $94,428,308, or 76 percent of the $125,000,000
distribution, which the Partnership distributed to its partners of record as of
the closing date of the sale of the Albuquerque System. This distribution was
made to the limited partners in July 1998. The limited partners of the
Partnership, as a group, received $90,101,856 and Jones Intercable received
$4,326,452. Such distribution represented $380 for each $500 limited partnership
interest, or $760 for each $1,000 invested in the Partnership.
On December 31, 1998, the Venture sold the Palmdale System to a
subsidiary of Jones Intercable for a sales price of $138,205,200. The Venture
repaid all of its remaining indebtedness, retained $2,500,000 of the sale
proceeds for a reserve for the administrative expenses of the Partnership,
including expenses that the Venture and its constituent partnerships may incur
related to pending litigation, settled working capital adjustments and
distributed the remaining sale proceeds of $89,101,000 to the three constituent
partnerships of the Venture in proportion to their ownership interests in the
Venture. The Partnership received $67,309,253, or 76 percent, of the $89,101,000
distribution, which the Partnership distributed in December 1998 and January
1999 to its partners of record as of December 31, 1998. Because the limited
partners had already received distributions in an amount in excess of the
capital initially contributed to the Partnership by the limited partners, the
Partnership's portion of the net proceeds from the Palmdale System's sale were
distributed 75 percent to the limited partners and 25 percent to Jones
Intercable. The limited partners of the Partnership, as a group, received
$50,481,940 and Jones Intercable received $16,827,313. The limited partners'
distribution represented $213 for each $500 limited partnership interest, or
$426 for each $1,000 invested in the Partnership.
Taking into account all distributions that have been made, the
Partnership's limited partners have received $767 for each $500 limited
partnership interest, or $1,534 for each $1,000 invested in the Partnership.
The Venture and the Partnership will not be dissolved until after all
pending litigation relating to the Venture and the Partnership has been resolved
and terminated.
Contributed Capital
The capitalization of Fund 12-D is set forth in the accompanying
consolidated statements of partners' capital (deficit). No limited partner is
obligated to make any additional contributions to partnership capital. Jones
Intercable purchased its interest in Fund 12-D by contributing $1,000 to
partnership capital.
All profits and losses of Fund 12-D are allocated 99 percent to the
limited partners and 1 percent to the general partner, except for income or gain
from the sale or disposition of cable television properties, which will be
allocated to the partners based upon the formula set forth in the Partnership
Agreement, and interest income earned prior to the first acquisition by Fund
12-D of a cable television system, which was allocated 100 percent to the
limited partners.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Records
The accompanying consolidated financial statements have been prepared
on the accrual basis of accounting in accordance with generally accepted
accounting principles. Fund 12-D's tax returns were also prepared on the accrual
basis.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Principles of Consolidation
The accompanying consolidated financial statements include 100 percent
of the accounts of Fund 12-D and those of the Venture reduced by the approximate
24 percent minority interest in the Venture. All inter-partnership accounts and
transactions have been eliminated.
14
Property, Plant and Equipment
Depreciation was provided using the straight-line method over the
following estimated service lives:
Cable distribution systems 5 - 15 years
Equipment and tools 3 - 5 years
Office furniture and equipment 3 - 5 years
Buildings 30 years
Vehicles 3 - 4 years
Replacements, renewals and improvements were capitalized and
maintenance and repairs were charged to expense as incurred.
Property, plant and equipment and the corresponding accumulated
depreciation were written off as certain assets became fully depreciated and
were no longer in service.
Intangible Assets
Costs assigned to franchises and costs in excess of interests in net
assets purchased were amortized using the straight-line method over the
following estimated useful lives:
Franchise costs 10 - 13 years
Costs in excess of interests in
net assets purchased 27 - 28 years
Revenue Recognition
Subscriber prepayments were initially deferred and recognized as
revenue when earned.
Cash and Cash Equivalents
For purposes of the Statements of Cash Flows, the Venture considered
all highly liquid investments purchased with an original maturity of three
months or less to be cash equivalents.
(3) TRANSACTIONS WITH JONES INTERCABLE AND AFFILIATES
Management Fees, Distribution Ratios and Reimbursements
Jones Intercable managed Fund 12-D and the Venture and received a fee
for its services equal to 5 percent of the gross revenues of the Venture,
excluding revenues from the sale of cable television systems or franchises.
Jones Intercable did not receive a management fee after December 31, 1998.
Management fees paid to Jones Intercable by the Venture were $2,974,638 and
$4,133,751 during 1998 and 1997, respectively.
Any partnership distributions made from cash flow (defined as cash
receipts derived from routine operations, less debt principal and interest
payments and cash expenses) were allocated 99 percent to the limited partners
and 1 percent to Jones Intercable. Any distributions other than interest income
on limited partnership subscriptions earned prior to the acquisition of Fund
12-D's first cable television system or from cash flow, such as from the sale or
refinancing of a system or upon dissolution of the Partnership, were made as
follows: first, to the limited partners in an amount which, together with all
prior distributions, will equal the amount initially contributed by the limited
partners; the balance, 75 percent to the limited partners and 25 percent to
Jones Intercable.
The Venture reimburses its general partner for certain administrative
expenses. These expenses represent the salaries and related benefits paid for
corporate personnel. Such personnel provide administrative, accounting, tax,
legal and investor relations services to the Venture and its constituent
partnerships. Such services, and their related costs, are necessary to the
administration of the Venture and its constituent partnerships. Such costs were
charged to operating costs during the periods that the Venture operated its
cable television systems. Subsequent to the sale of the Venture's final
15
cable television system, such costs were charged to other expense.
Reimbursements made to Jones Intercable by the Venture for overhead and
administrative expenses were $101,073, $3,545,252 and $4,615,841 in 1999, 1998
and 1997, respectively.
The Venture was charged interest during 1999 at an average rate of 7.18
percent on amounts due Jones Intercable, which approximately Jones Intercable's
weighted average cost of borrowing. Total interest charged to the Venture by
Jones Intercable in 1999 was $15,013, net of interest earned by the Partnership
on amounts outstanding due from Jones Intercable.
Payments to/from Affiliates for Programming Services
Prior to the sale of its cable television systems in 1998, the Venture
received programming from Superaudio, Knowledge TV, Inc., Jones Computer
Network, Ltd., Great American Country, Inc. and Product Information Network, all
of which were affiliates of Jones Intercable until April 7, 1999 (see Note 1).
Payments to Superaudio totaled $90,778 and $118,032 in 1998 and 1997,
respectively. Payments to Knowledge TV, Inc. totaled $97,965 and $131,277 in
1998 and 1997, respectively. Payments to Jones Computer Network, Ltd., whose
service was discontinued in April 1997, totaled $85,543 in 1997. Payments to
Great American Country, Inc., totaled $91,227 and $131,863 in 1998 and 1997
respectively.
Prior to the sale of its cable television systems in 1998, the Venture
received a commission from Product Information Network based on a percentage of
advertising sales and number of subscribers. Product Information Network paid
commissions to the Venture totaling $193,110 and $199,997 in 1998 and 1997,
respectively.
(4) INCOME TAXES
------------
Income taxes have not been recorded in the accompanying consolidated
financial statements because they accrue directly to the partners. The federal
and state income tax returns of Fund 12-D are prepared and filed by the general
partner.
Fund 12-D's tax returns, the qualification of the Partnership as such
for tax purposes, and the amount of distributable income or loss are subject to
examination by federal and state taxing authorities. If such examinations result
in changes with respect to Fund 12-D's qualification as such, or in changes with
respect to Fund 12-D's recorded income or loss, the tax liability of the general
and limited partners would likely be changed accordingly.
(5) COMMITMENTS AND CONTINGENCIES
Litigation Challenging Jones Intercable's Acquisition of the Tampa System
Jones Intercable was a defendant in a consolidated civil action filed
by limited partners of Cable TV Fund 12-D, Ltd. captioned David Hirsch, Marty,
--------------------
Inc. Pension Plan (by its trustee and beneficiary, Martin Ury) and Jonathan and
- -------------------------------------------------------------------------------
Eileen Fussner, derivatively on behalf of Cable TV Fund 12-B, Ltd., Cable TV
- ----------------------------------------------------------------------------
Fund 12-C, Ltd. and Cable TV Fund 12-D, Ltd., plaintiffs v. Jones Intercable,
- -----------------------------------------------------------------------------
Inc., defendant, and Cable TV Fund 12-BCD Venture, Cable TV Fund 12-B, Ltd.,
- ----------------------------------------------------------------------------
Cable TV Fund 12-C, Ltd. and Cable TV Fund 12-D, Ltd., nominal defendants
- -------------------------------------------------------------------------
(District Court, Arapahoe County, State of Colorado, Case No. 95-CV-1800,
Division 3). The consolidated complaint generally alleged that Jones Intercable
breached its fiduciary duty to the plaintiffs and to the other limited partners
of the three named partnerships and to the Venture in connection with the
Venture's sale of the Tampa, Florida cable television system (the "Tampa
System") to a subsidiary of Jones Intercable and the subsequent trade of the
Tampa System and other cable systems owned by Jones Intercable in exchange for
cable television systems owned by an unaffiliated cable system operator. The
consolidated complaint also set forth a claim for breach of contract and a claim
for breach of the implied covenant of good faith and fair dealing. Among other
things, the plaintiffs asserted that the subsidiary of Jones Intercable that
acquired the Tampa System paid an inadequate price for it. The price paid for
the Tampa System was determined by the average of three separate, independent
appraisals of the Tampa System's fair market value as required by the terms of
the limited partnership agreements of the three named partnerships. The
plaintiffs also challenged the adequacy and independence of the appraisals. The
consolidated complaint sought compensatory damages, an award of attorneys' fees,
punitive damages and certain equitable relief. On October 25, 1999, the district
court granted Jones Intercable's motion to dismiss and for summary judgment
based upon the August 1998 report of independent counsel, which had concluded
that the plaintiffs'
16
claims were not meritorious and were not supported by a preponderance of the
evidence. The plaintiffs gave notice of their intention to appeal the district
court's decision, but in return for Jones Intercable's agreement to pay a
portion of the plaintiffs' attorneys' costs in the amount of approximately
$229,000, the plaintiffs voluntarily dismissed their appeal and this litigation
has been finally terminated and resolved.
Litigation Challenging Jones Intercable's Acquisitions of the Albuquerque and
Palmdale Systems
In June 1999, Jones Intercable was named a defendant in a case
captioned City Partnership Co., derivatively on behalf of Cable TV Fund 12-C,
-------------------------------------------------------------------
Ltd., Cable TV Fund 12-D, Ltd. and Cable TV Fund 12-BCD Venture, plaintiff v.
- -----------------------------------------------------------------------------
Jones Intercable, Inc., defendant and Cable TV Fund 12-C, Ltd., Cable TV Fund
- -----------------------------------------------------------------------------
12-D, Ltd. and Cable TV Fund 12-BCD Venture, nominal defendants (U.S. District
- ---------------------------------------------------------------
Court, District of Colorado, Civil Action No. 99-WM-1155) brought by City
Partnership Co., a limited partner of the named partnerships. The plaintiff's
complaint alleges that Jones Intercable breached its fiduciary duty to the
plaintiff and to the other limited partners of the partnerships and to the
Venture in connection with the Venture's sale of the Palmdale, California cable
television system (the "Palmdale System") to a subsidiary of Jones Intercable in
December 1998. The complaint alleges that Jones Intercable acquired the Palmdale
System at an unfairly low price that did not accurately reflect the market value
of the Palmdale System. The plaintiff also alleges that the proxy solicitation
materials delivered to the limited partners of the partnerships in connection
with the votes of the limited partners on the Venture's sale of the Palmdale
System contained inadequate and misleading information concerning the fairness
of the transaction, which the plaintiff claims caused Jones Intercable to breach
its fiduciary duty of candor to the limited partners and which the plaintiff
claims constituted acts and omissions in violation of Section 14(a) of the
Securities Exchange Act of 1934, as amended. Plaintiff also claims that Jones
Intercable breached the contractual provision of the partnerships' limited
partnership agreements requiring that the sale price be determined by the
average of three separate, independent appraisals, challenging both the
independence and the currency of the appraisals. The complaint finally seeks
declaratory injunctive relief to prevent Jones Intercable from making use of the
partnerships' funds to finance Jones Intercable's defense of this litigation.
Jones Intercable has filed motions to dismiss certain of the plaintiff's claims
for relief. The General Partner believes that the procedures followed by Jones
Intercable in conducting the votes of the limited partners of the partnerships
on the sale of the Palmdale System, including the fairness opinion in the proxy
statements delivered to the limited partners of the partnerships, were proper
and that the Venture's sale of the Palmdale System at a price determined by
averaging three separate, independent appraisals was in accordance with the
express provisions of the partnerships' limited partnership agreements. The
General Partner intends to defend this lawsuit vigorously.
In August 1999, Jones Intercable was named a defendant in a case
captioned Gramercy Park Investments, LP, Cobble Hill Investments, LP and
--------------------------------------------------------------
Madison/AG Partnership Value Partners II, plaintiffs v. Jones Intercable, Inc.
- ------------------------------------------------------------------------------
and Glenn R. Jones, defendants, and Cable TV Fund 12-B, Ltd., Cable TV Fund
- ---------------------------------------------------------------------------
12-C, Ltd., Cable TV Fund 12-D, Ltd., Cable TV Fund 14-A, Ltd. and Cable TV Fund
- --------------------------------------------------------------------------------
14-B, Ltd., nominal defendants (U.S. District Court, District of Colorado, Civil
- ------------------------------
Action No. 99-B-1508) ("Gramercy Park") brought as a class and derivative action
by limited partners of the named partnerships. The plaintiffs' complaint alleges
that the defendants made false and misleading statements to the limited partners
of the named partnerships in connection with the solicitation of proxies and the
votes of the limited partners on the sales of the Albuquerque, Palmdale,
Littlerock and Calvert County cable communication systems by the named
partnerships to Jones Intercable or one of its subsidiaries in violation of
Sections 14 and 20 of the Securities Exchange Act of 1934, as amended. The
plaintiffs specifically allege that the proxy statements delivered to the
limited partners in connection with the limited partners' votes on these sales
were false, misleading and failed to disclose material facts necessary to make
the statements made not misleading. The plaintiffs' complaint also alleges that
the defendants breached their fiduciary duties to the plaintiffs and to the
other limited partners of the named partnerships and to the named partnerships
in connection with the various sales of the Albuquerque, Palmdale, Littlerock
and Calvert County cable communications systems to subsidiaries of Jones
Intercable. The complaint alleges that Jones Intercable acquired these cable
communications systems at unfairly low prices that did not accurately reflect
the market values of the systems. The plaintiffs seek on their own behalf and on
behalf of all other limited partners compensatory and nominal damages, the costs
and expenses of the litigation, including reasonable attorneys' and experts'
fees, and punitive and exemplary damages.
In September 1999, Jones Intercable was named a defendant in a case
captioned Mary Schumacher, Charles McKenzie and Geraldine Lucas, plaintiffs v.
--------------------------------------------------------------------
Jones Intercable, Inc. and Glenn R. Jones, defendants and Cable TV Fund 12-B,
- -----------------------------------------------------------------------------
Ltd., Cable TV Fund 12-C, Ltd., Cable TV Fund 12-D, Ltd., Cable TV Fund 14-A,
- -----------------------------------------------------------------------------
Ltd. and Cable TV Fund 14-B, Ltd., nominal defendants (U.S. District Court,
- -----------------------------------------------------
District of Colorado, Civil Action No. 99-WM-1702) ("Schumacher") brought as a
class and derivative action by three limited partners of the named partnerships.
The substance of the plaintiffs' complaint is similar to the allegations raised
in the Gramercy Park case.
-------------
17
In September 1999, Jones Intercable was named a defendant in a case
captioned Robert Margolin, Henry Wahlgren and Joan Wahlgren, plaintiffs v. Jones
----------------------------------------------------------------------
Intercable, Inc. and Glenn R. Jones, defendants and Cable TV Fund 12-B, Ltd.,
- -----------------------------------------------------------------------------
Cable TV Fund 12-C, Ltd., Cable TV Fund 12-D, Ltd., Cable TV Fund 14-A, Ltd. and
- --------------------------------------------------------------------------------
Cable TV Fund 14-B, Ltd., nominal defendants (U.S. District Court, District of
- --------------------------------------------
Colorado, Civil Action No. 99-B-1778) ("Margolin") brought as a class and
derivative action by three limited partners of the named partnerships. The
substance of the plaintiffs' complaint is similar to the allegations raised in
the Gramercy Park case.
-------------
The General Partner believes that the procedures followed by Jones
Intercable in conducting the votes of the limited partners of the various
partnerships on the sales of the Albuquerque, Palmdale, Littlerock and Calvert
County systems and the disclosures in the proxy statements delivered to the
limited partners in connection with the limited partners' votes on these sales
were proper and complete, and the General Partner believes that the various sale
transactions were fair because they were at prices determined by averaging three
separate, independent appraisals of the various cable communications systems
sold in accordance with the express provisions of the partnerships' limited
partnership agreements. The General Partner intends to defend these lawsuits
vigorously.
In November 1999, the United States District Court for the District of
Colorado entered an order consolidating all of the cases challenging Jones
Intercable's acquisitions of the Albuquerque, Palmdale, Littlerock and Calvert
County systems because these cases involve common questions of law and fact.
Litigation Relating to Limited Partnership List Requests
In July 1999, Jones Intercable, each of its subsidiaries that serve as
general partners of Jones Intercable's managed partnerships and most of Jones
Intercable's managed partnerships, including the Partnership, were named
defendants in a case captioned Everest Cable Investors, LLC, Everest Properties,
-------------------------------------------------
LLC, Everest Properties II, LLC and KM Investments, LLC, plaintiffs v. Jones
- ----------------------------------------------------------------------------
Intercable, Inc., et al., defendants (Superior Court, Los Angeles County, State
- ------------------------------------
of California, Case No. BC 213632).
Plaintiffs allege that certain of them formed a plan to acquire up to
4.9% of the limited partnership interests in each of the managed partnerships
named as defendants, and that plaintiffs were frustrated in this purpose by
Jones Intercable's alleged refusal to provide plaintiffs with lists of the names
and addresses of the limited partners of these partnerships. The complaint
alleges that Jones Intercable's actions constituted a breach of contract, a
breach of Jones Intercable's implied covenant of good faith and fair dealing
owed to the plaintiffs as limited partners, a breach of Jones Intercable's
fiduciary duty owed to the plaintiffs as limited partners and tortious
interference with prospective economic advantage. Plaintiffs allege that Jones
Intercable's failure to provide them with the partnership lists prevented them
from making their tender offers and that they have been injured by such action
in an amount to be proved at trial, but not less than $17 million.
In September 1999, Jones Intercable and the defendant subsidiaries and
managed partnerships filed a notice of demurrers to the plaintiffs' complaint
and a hearing on this matter was held in October 1999. In December 1999, the
Court sustained the defendants' demurrers in part but the Court gave the
plaintiffs' leave to amend their complaint to attempt to cure the deficiencies
in the pleadings. The plaintiffs filed their first amended complaint in January
2000.
Discovery in the case also has begun, and Jones Intercable and the
defendant subsidiaries and managed partnerships have responded to the
plaintiffs' first set of interrogatories and the plaintiffs' first demand for
the production of documents. Comcast JOIN Holdings, Inc., believes that the
defendants have defenses to the plaintiffs' claims for relief and challenges to
the plaintiffs' claims for damages, and the General Partner intends to defend
this lawsuit vigorously.
18
(6) SUPPLEMENTARY PROFIT AND LOSS INFORMATION
Supplementary profit and loss information is presented below:
For the Year Ended December 31,
----------------------------------------
1999 1998 1997
---------- ----------- -----------
Maintenance and repairs $ - $ 394,740 $ 734,011
========== =========== ===========
Taxes, other than income
and payroll taxes $ - $ 711,408 $ 873,053
========== =========== ===========
Advertising $ - $ 1,260,705 $ 1,288,316
========== =========== ===========
Depreciation of property,
plant and equipment $ - $14,207,696 $18,824,685
========== =========== ===========
Amortization of intangible
assets $ - $ 2,292,993 $ 3,012,566
========== =========== ===========
19
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership itself has no officers or directors. Certain information
concerning the directors and executive officers of the General Partner is set
forth below. Directors of the General Partner serve until the next annual
meeting of the General Partner and until their successors shall be elected and
qualified.
RALPH J. ROBERTS is Chairman of the General Partner's Board of Directors.
Mr. Roberts served as Chairman of Jones Intercable, Inc.'s Board of Directors
from April 1999 until its merger with the General Partner in March 2000. Mr.
Roberts has served as a director of Comcast Corporation and as the Chairman of
its Board of Directors for more than five years. Mr. Roberts has been the
President and a director of Sural Corporation, a privately held investment
company that is Comcast Corporation's controlling shareholder, for more than
five years. Mr. Roberts is also a director of Comcast Cable Communications, Inc.
and Comcast LCI Holdings, Inc. Mr. Roberts is the father of Brian L. Roberts. He
is 80 years old.
BRIAN L. ROBERTS is President and a director of the General Partner. Mr.
Roberts served as President and a director of Jones Intercable, Inc. from April
1999 until its merger with the General Partner in March 2000. Mr. Roberts has
served as the President and as a director of Comcast Corporation for more than
five years. Mr. Roberts also serves as Vice President and as a director of Sural
Corporation. He also is a director of Comcast Cable Communications, Inc.,
Comcast LCI Holdings, Inc., At Home Corporation and The Bank of New York
Company, Inc. Mr. Roberts is a son of Ralph J. Roberts. He is 40 years old.
LAWRENCE S. SMITH is Executive Vice President and a director of the
General Partner. Mr. Smith served as an Executive Vice President and a director
of Jones Intercable, Inc. from April 1999 until its merger with the General
Partner in March 2000. Mr. Smith has served as an Executive Vice President of
Comcast Corporation since December 1995. Prior to that time, he served as Senior
Vice President of Comcast Corporation for more than five years. Mr. Smith is
also a director of Comcast Cable Communications, Inc. and Comcast LCI Holdings,
Inc. He is 52 years old.
STANLEY L. WANG is Executive Vice President and Secretary and a director
of the General Partner. Mr. Wang served as Senior Vice President and Secretary
and a director of Jones Intercable, Inc. from April 1999 until its merger with
the General Partner in March 2000. Mr. Wang has served as an Executive Vice
President of Comcast Corporation since February 2000. Prior to that time, he
served as Senior Vice President of Comcast Corporation for more than five years.
Mr. Wang also has served as Secretary of Comcast Corporation for more than five
years. Mr. Wang is also a director of Comcast Cable Communications, Inc. and
Comcast LCI Holdings, Inc. He is 59 years old.
JOHN R. ALCHIN is Executive Vice President and Treasurer of the General
Partner. Mr. Alchin served as Senior Vice President and Treasurer and a director
of Jones Intercable, Inc. from April 1999 until its merger with the General
Partner in March 2000. Mr. Alchin has served as an Executive Vice President of
Comcast Corporation since February 2000. Prior to that time, he served as Senior
Vice President of Comcast Corporation for more than five years. Mr. Alchin also
has served as Treasurer of Comcast Corporation for more than five years. Mr.
Alchin is the Principal Financial Officer of the General Partner and of Comcast
Corporation. He is 51 years old.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE. Each of the
directors and executive officers of the General Partner were directors and
executive officers of Jones Intercable prior to its merger with the General
Partner on March 2, 2000. Jones Intercable was the general partner of the
Partnership prior to March 2, 2000. These persons became directors and executive
officers of Jones Intercable on April 7, 1999, the date Comcast acquired a
controlling interest in Jones Intercable. These persons failed to file on a
timely basis reports disclosing their ownership of limited partnership interests
of the Partnership as required by Section 16(a) of the
20
Securities Exchange Act of 1934. The reports, when filed, disclosed that these
persons own no limited partnership interests of the Partnership.
ITEM 11. EXECUTIVE COMPENSATION
The Partnership has no employees; however, various personnel are
required to administer the financial, tax and legal affairs of the Partnership
and to maintain the books and records of the Partnership. Such personnel are
employed by Comcast and, pursuant to the terms of the limited partnership
agreement of the Partnership, the costs of such employment are charged by
Comcast to the Partnership. See ITEM 13.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGERS
As of December 31, 1999, no person or entity owned more than 5% of the
limited partnership interests of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership and the Venture reimburse the Partnership's general
partner for certain allocated overhead and administrative expenses. These
expenses represent the salaries and benefits paid to corporate personnel. Such
personnel provide administrative, tax, accounting, legal and investor relations
services to the Partnership and the Venture. The Partnership and the Venture
will continue to reimburse the Partnership's general partner for actual time
spent on Partnership and Venture business by employees of Comcast until the
Partnership and the Venture are liquidated and dissolved. During the year ended
December 31, 1999, such reimbursements made by the Venture totaled $101,073. The
Partnership made no such reimbursements in 1999.
The Partnership and the Venture are charged interest on amounts
advanced by the Partnership's general partner. The interest rate in 1999 was at
an average of 7.18%, which approximated Jones Intercable's weighted average cost
of borrowing. During the year ended December 31, 1999, the Venture paid interest
charges of $15,013.
The Partnership paid no management fees or brokerage fees or
programming service fees to affiliates during 1999 and it is expected that the
Partnership will never again pay management fees or brokerage fees or
programming service fees.
21
PART IV.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) 1. See index to financial statements for list of financial statements
and exhibits thereto filed as a part of this report.
3. The following exhibits are filed herewith:
4.1 Limited Partnership Agreement for Cable TV Fund 12-D, Ltd.
(Incorporated by reference from the Partnership's Annual Report on
Form 10-K for the fiscal year ended December 31, 1985.)
4.2 Joint Venture Agreement of Cable TV Fund 12-BCD Venture dated as
of March 17, 1986, among Cable TV Fund 12-B, Ltd., Cable TV
Fund 12-C, Ltd. and Cable TV Fund 12-D, Ltd. (Incorporated by
reference from the Partnership's Annual Report on Form 10-K for
the fiscal year ended December 31, 1987.)
27 Financial Data Schedule
(b) Reports on Form 8-K.
None.
22
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 in Philadelphia,
Pennsylvania.
CABLE TV FUND 12-D, LTD.,
a Colorado limited partnership
By: Comcast JOIN Holdings, Inc.,
a Delaware corporation,
its general partner
By: /s/ Brian L. Roberts
-----------------------------------
Brian L. Roberts
Dated: March 22, 2000 President; Director
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: /s/ Ralph J. Roberts
-----------------------------------
Ralph J. Roberts
Dated: March 22, 2000 Chairman; Director
By: /s/ Brian L. Roberts
-----------------------------------
Brian L. Roberts
President; Director
Dated: March 22, 2000 (Principal Executive Officer)
By: /s/ Lawrence S. Smith
-----------------------------------
Lawrence S. Smith
Dated: March 22, 2000 Executive Vice President; Director
By: /s/ Stanley L. Wang
-----------------------------------
Stanley L. Wang
Dated: March 22, 2000 Executive Vice President;
Secretary; Director
By: /s/ John R. Alchin
-----------------------------------
John R. Alchin
Executive Vice President; Treasurer
Dated: March 22, 2000 (Principal Financial Officer)
By: /s/ Lawrence J. Salva
-----------------------------------
Lawrence J. Salva
Senior Vice President
Dated: March 22, 2000 (Principal Accounting Officer)
23