HomeMy WebLinkAbout850537.tiff AR1999896
RESOLUTION
RE: GRANTING FRANCHISE TO JONES TRI-CITY INTERCABLE, INC.
WHEREAS, the Board of County Commissioners of Weld County,
Colorado, pursuant to Colorado statute and the Weld County Home
Rule Charter, is vested with the authority of administering the
affairs of Weld County, Colorado, and
WHEREAS, after a full and complete hearing on all aspects of
the application of Jones Tri-City Intercable , Inc. , for a
franchise to construct, maintain, and operate a cable television
system and distribution facilities and additions and removal
thereto in, under, above, along and upon the road, highways ,
bridges, viaducts , easements for the public utilities in a portion
of the unincorporated area of the County of Weld, more
particularly described in Exhibit A attached hereto and
incorporated herein by reference, and
WHEREAS, after full discussion and due deliberation, the
Commissioners of the County of Weld, herein called the "County, "
find that the construction, operation and maintenance of a cable
television system serving the County is consistent with the public
interest, and specifically, with the establishment and proper
maintenance of television broadcast service within the
unincorporated areas of the County, and
WHEREAS, the Board of County Commissioners of the County of
Weld recognizes that Jones Tri-City Intercable, Inc. will be
serving only a small area in Weld County, will serve less than 500
subscribers in Weld County, and that its principal area of service
is within the City of Brighton, County of Adams, State of
Colorado, and
WHEREAS, the applicant has presented facts sufficient to
assure that access to cable service will not be denied to any
group of potential residential subscribers because of the income
of the residents of the local area in which such group resides,
and
WHEREAS, the granting of such franchise is, in the judgment
of the Commissioners , conducive to the best interests of the
inhabitants of the County, and
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F 1317 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO
850537
Page 2
RE: GRANT CABLE TV FRANCHISE
WHEREAS, the applicant has presented facts sufficient to
persuade the Board of County Commissioners of the County of Weld,
to invoke the WAIVER OF REQUIREMENTS heading of Ordinance 94-A
amending Ordinance 94 in a limited manner as hereinafter set
forth.
NOW, THEREFORE, BE IT RESOLVED by the Board of County
Commissioners of Weld County, Colorado, that Jones Tri-City
Intercable, Inc. , a Colorado corporation, its successors and
assigns, is hereby granted a nonexclusive, revocable franchise to
construct, maintain and operate such transmission and distribution
facilities as may be reasonably required for or are, in any
manner, incidental to the transmission of signals, other than
telephone company signals , by wire in and for the unincorporated
areas of the County, designated in Exhibit A. This franchise and
all rights granted hereunder shall continue for a period of
fifteen years from the effective date hereof, unless sooner
terminated or revoked.
This grant of franchise shall be subject to and governed by
Weld County Ordinances No. 94 , No. 94-A and No. 94-B as the same
shall be amended or succeeded, subject to the following exceptions
hereby granted pursuant to the WAIVER OF REQUIREMENTS heading of
Ordinance 94-A amending Ordinance 94 :
1 . Upon application, the County may waive the hearing
requirements of paragraph D, Sections 2 through 7 ,
RATE/SPECIAL MONTHLY SERVICE RATES/DEPOSITS , if it determines
that the rate requested is identical to and has been approved
by the City of Brighton for subscribers within said city,
after a public hearing which substantially comports with the
due process requirements of this heading.
2 . The franchise fee as set forth in the FRANCHISE FEE
heading shall apply only to the gross revenues of the company
received from subscribers in Weld County.
3 . Section B of heading COMPANY SERVICES shall be met
by company' s inclusion of announcements of public interest on
their public access channel in operation for the City of
Brighton.
4 . Section C of heading COMPANY SERVICES shall be met
by the availability of all company facilities and equipment,
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F 1318 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO
Page 3
RE: GRANT CABLE TV FRANCHISE
available to the City of Brighton for utilization within the
franchised area as contemplated by said section.
5 . Sections B and C of heading EMERGENCIES are waived
as to this franchise and Section A shall be met by making
company' s facilities available to the City of Brighton in
accordance with the terms thereof.
The above and foregoing Resolution was, upon motion duly made
and seconded, adopted by the following vote on the 20th day of
February, A.D. , 1985 .
//// nn.t 7 BOARD OF COUNTY COMMISSIONERS
ATTEST: r� a <� WELD COUNTY, COLORADO
Weld County lerk and Recorder
and Clerk to the Bog d J e ne Jo son, Chairman
By: SYV��I eJ LGeJ
b put .-Co Aty erk ene R. Bra ner, Pro-Tem
PRE A
C. W. IfirS*
County Attorney
• .r. r '�% Lacy
•
ran Y, aguch '
B 1059 REC 01999896 02/26/85 10: 07 $0 . 00 3/003
F 1319 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO
HEARING CERTIFICATION
DOCKET NO. 85-5
RE: CABLE TELEVISION FRANCHISE, JONES TRI-CITY INTERCABLE, INC.
A public hearing was conducted on February 20, 1985, at 2:00 P.M. , with
the following present:
Commissioner Jacqueline Johnson, Chairman
Commissioner Gene Brantner, Pro-Tem
Commissioner C.W. Kirby
Commissioner Gordon E. Lacy
Commissioner Frank Yamaguchi
Also present:
Acting Clerk to the Board, Mary Reiff
Assistant County Attorney, Michael Kelley
The following business was transacted:
I hereby certify that pursuant to a notice dated January 28, 1985, and
duly published February 7, 1985, in the La Salle Leader, a public
hearing was conducted to consider granting a cable television franchise
to Jones Tri-City Intercable, Inc. Mike Kelley, Assistant County
Attorney, explained this request and stated that the necessary
documentation had been submitted and the application appears to be in
order. Mr. Kelley stated that Jones Intercable is requesting that
certain requirements be waived, since they will be serving less than
500 subscribers in Weld County. This application will allow them to
serve a mobile home park, with their main service being in the City of
Brighton. Bill Sisk, system manager for Jones Intercable, came forward
to answer questions of the Board. Dwight Thompson, manager of Sylmar
Mobile Home Park, also came forward to answer questions. Commissioner
Brantner moved to approve the cable television franchise for Jones
Tri-City Intercable, Inc. and waive the requested requirements, and
reviewed the criteria to be considered in granting such franchise. The
motion was seconded by Commissioner Kirby. Discussion was held about
the requirements to be waived, after which the motion carried
unanimously.
APPROVED:
n 1 BOARD OF COUNTY COMMISSIONERS
ATTEST: (� ws 7 WELD COUNTY, COLORADO
Weld County Clerk and Recorder . .\
and Clerk to the Board �Jc.tPro-Lm
q e Jo sun, Chairman
Duty County Clerk
/
C.W. Kir
Frank Yama c
TAPE #85-15
DOCKET #85-5
ORD 94
ATTENDANCE RECORD
TODAY ' S HEARINGS ARE AS FOLLOWS :
DOCKET # 85-5 - Jones Tri-City Intercable, Inc. , Cable Television Franchise
DOCKET #85-8 - Pannagreen Products Canpany, USR-Fertilizer operation
DOCKET #85-9 - Weeks Energy Cozpiration, USR-Oil & Gas Production facilities
PLEASE write or print legibly your name, address and the DOC 4 (as ti_tcd
above) or the applicants name of the hearing you are attending .
NAME ADDRESS HEARING ATTENDING
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NOTICE
Docket No. 85-5
Pursuant to Weld County Ordinance No. 94 , a public hearing will be
held in the Chambers of the Board of County Commissioners of Weld
County, Colorado, Weld County Centennial Center, 915 10th Street,
First Floor, Greeley, Colorado, at the time indicated below, for
consideration of granting a franchise to Jones Tri-City
Intercable , Inc. , including non-exclusive rights to construct a
cable television system along the streets , alleys, and public ways
of the County.
Application materials may be examined in the office of the Clerk
to the Board of County Commissioners , located in the Weld County
Centennial Center, 915 10th Street, Third Floor, Greeley,
Colorado.
DATE: February 20 , 1985
TIME: 2 : 00 P.M.
REQUEST: Cable Television Franchise
BOARD OF COUNTY COMMISSIONERS
WELD COUNTY, COLORADO
BY: MARY ANN FEUERSTEIN
WELD COUNTY CLERK AND RECORDER
AND CLERK TO THE BOARD
BY: Mary Reiff, Deputy
DATED: January 28 , 1985
PUBLISHED: February 7 , 1985 , in the La Salle Leader
4r
,/,
DATE: January 28 , 1985
TO: The Board of County Commissioners
Weld County, Colorado
FROM: Clerk to the Board Office
Commissioners:
If you have no objections , we have tentatively set the
following hearing for the 20th day of February, 1985 , at 2 : 00 P.M.
Docket No. 85-5 - Jones Tri-City Intercable, Inc. , Cable
Television Franchise
OFFICE OF THE CLEW, TO
THE BOARD
BY: / /tZ2 y, / -le- , Deputy
The above mentioned hearing date and hearing time may be scheduled
on the agenda as stated above.
BOARD OF COUNTY COMMISSIONERS
WELD COUNTY, COLORADO
P.
Affidavit of Publication
S=ASE CF CO:.ORADC. ; ss.
County al Weld. )
I. Paul Massey ci
said County et Weld Mane duly sworn. soy that
f am Quhhaher of
La Salle Leader
Legatpotice
that the m w sae is a efil7 newspaper e! genera! Oocaett10.05�s
c:strnen e�+d ranted and Fuhiisned in the
La Salle Pursbant TO','weld County
town of Ordinance N0.94,4 piblic,bearMg
will be held in Mre6Aamber of the
Msaid coney end state: that the notice or adwr• board of County Commissioners of
luteent. ci which the enneaed is a true ropy. weld County, comrade, wad
County Contemner Center,91$IOth
has been published in said weekly newspaper street,sUot Hear:aQ�rw.���te�l�, co(o.
far one dien'ixveer ratio, et linnet lmrcet*d below,
ter considersMe0y�q granttnea
weed: that the notice was Pubiisited in the franchise to Joiii:'Yn-City infer.
cable,me.,inani(rynon-excluslye
regular end enure issuec! every number el said 'nut ts-{a .prote tele-
newspaper dunnq the pen=G and time e! pubic- insien'siatem awn me streets,
tillers. and public ,ways of the
r_tion c! acid notice and in the newspaper Cwn+y proper _
and nel t.T a suppirnent thereat: diet the - -Application material! may be
lint publication ei said neuce was ccntatned in examined in thee&ke Of the mat*
becrinc date. tha +o tht Ceunty
the issue al aa:d newspaper ommissionarse,St,
tM weM
_7_ day of ?ehrn pry A...).. te.a5 _ county.CenMgalef Center,elders
strut,Third Floor,lireeey,Cob-
end the lest p•Ybii:anew thet<af, in tSt issue at
redo.
satd.newspaper becrne dote- Me day e. DATE:,Reeneare 3ii'YW
TIME 2:00 P,M:
Fe . l9&5: that the said REQUEST: Casa TeNvisien
. ' Franchise-r ,
La Salle_ Leader °Oe ll sw ERs
hes been published confnucusiy :net =interrupt- WELD cot cODEV,COLORADO
.
wily du:ine the penaa of et Bast fifty-two ctn. SYsMM TRIM
ELSWAMP
seatnvs weeks nor. prier to the first issue thorn: W rC Reerteit
eentciniaq semi notice at edveniaemers above
:elected to: and the: said newspaper was et the istiltitkneiffeblersty
Sere of each et the puo!!coriens of said notice.
6Kftfreanuary:le,Wes
duly qualified far that purpose within the seen
in; of en a:. entitled. "An Act Cancerrrnq Legal Puted iab in thei,.e lane Leader
on TMrsdav, February 7,1115.
:taricee. Adwnse:aenrs and %•:bllr_nca. and
the Fees of Printers end %'aolaners thereof. end
to Repeal elf Acts and Pens et Acts in Conflict
with the?r,rutcns of this Act." approved April i,
I9:I. and ell mend^ens therecf. and parnot-
tr.:ty as =ended Sy an art ^proved. March 21
. Inc�r rnd ea: =proved Ma t3. 1931.
" 2 tarter
Subscrierd gtdd sworn� �r ttc�be!are r..e this
d-y cf_ /227142=ar A.7.. I91
(
My cam-ssiea expires
/7— 7 ,GS —
Notary rshlte
LLIiikIJETH Mfrs5sEY
22019 W.C.RD. X31 .
GREELEY+ CO
ono/. 9y
PUBLISHER'S AFFIDAVIT
STATE OF COLORADO.
)so..
COUNTY OF Adams
Vi..J.un.e
do solemnly swear that I am the
Publisher of
...The..Brightcn..B.1ade...
that the same Is a weekly newspaper published
in the City of Brighton
countyor
NOTICE
State of Colorado,and has ageneral circulationDocket Me.854
County
Pursuant 4. public
hearing e gounb h ldin the
therein;tusl said unwse has bin sn dublished Cham ea s of Borwill Co had Cim-
eontlnuouslyend uninterruptedly in said Chambers of the Wild
of County Oom-
Weld n 01 County,Cntr,91510th
WeldFCounty lCentennialor,Greeley,e Cd995510th
,at
County of...ADams Street,
e`m indicated llow.for cconnaid r
lion of granting a Irandhiae to Jones TN
City Intercaba, Inc.,Including non-ex-
clusive rights to construct • cable
for a period of more than 52 weeks prior to the and television
public y of m the Countg the y. Pllays,
ways first publication of the annexed notice,that said Application materials may
be ex-
newspaper Is entered In the post office at amined in the office of the clerk to the
Board of County CommiseIonera,located
In the Weld.County Oenten Cesar.
915 10th Street, Third Floorr; - le.
Brighton Colorado.'
DATE:February 20,INS
TIME:2:00 P.M.
REQUEST:Cable Television Franchise
BOARD OF COUNTY COMMISSIONERS
Colorado, as second class mail matter and that WELD COUNTY,COLORADO
the said newspaper is a newspaper within the BY:MARY ANN FEUERSTEIN
meaning of the act of the General Assembly of WELD COUNTY:CLERK
the Stale of Colorado,approved March 30,1923, AND RECORDER
and entitled"Legal Notices and Advertisements" ANDCLERK
BY:
M Mary ROM.TO R BOARD.
Deputy
and other acts relating to the printing and DATED:January 1985
publishing of legal notices and advertisments; Published In the Brighton Blade
that the annexed notice was published In the Firer Publication February 8.1985
regular and entire issues of said newspaper,
once each week,on the same day of each week
for the period of
1
consecutive insertions; that the first
publication of said newspaper dated
February 6 , 19..85ndthe
last publication of said notice was in the issue of
said newspaper dated
19
/
y//�
�/ /7 Signature and Title
Subscribed and sworn to before me,a Notary
Public,this 6 th day of
February 19 .85
Notary Public
My es.7.1t`^w'on expires March 3, 1986
1.O U,i 1 �:i i. 9 i*.y ito,,,, ty t J8 i1
s eiTh •
JONES INTERCR2 E,a
INL,M
N
e I : ;1 r:), , , .rd , for a C Ic1:1_HSe I _
L';._ > _ onsider _ a s-,uld be r:ciated.
1: .
R. Sis'c
S.:at jn '". •saner
60 Garden Center, Suite 202 Broomfield, Colorado 80020 303/466-7376
632
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Jon I'.- usi
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Par- ; ; .;wood, Cole d ' 740-97C
(2)
2) Cable television service for Weld County will be provided
from Jones Intercable's Brighton office and head-end
facility. The office/head-end is located at 965 Bridge St. ,
Brighton, Colorado 80601. Business hours are 8:00am to
5:00pm, Monday thru Friday. Normal holidays are observed.
The Brighton office is staffed by a total of three employees.
The system receives technical and management support from a
sister company, Jones Tri-City Intercable located in Broomfield,
Colorado. The Brighton office is a full service office. Bills,
installations and service calls are processed from that location.
From time to time the Brighton office receives additional field
and office assistance from the Broomfield system.
The cable system's maximum capacity is 35 video channels (300 mhz) .
The system also has been designed to handle two-way transmission
of video and data signals. However, at this time the reverse
pathway is not operational in any portion of the Brighton system.
Following is a list of the channels which are offered in the
Brighton system at present. Channels marked with an asterisk
are premium or extra cost channels.
Channel Call Letters Affiliation Source
2 KWGN Independent Broadcast
3 Cable News Network Satellite
4 KCNC NBC Broadcast
5 The Learning Channel Satellite
6 KRMA PBS Broadcast
7 KMGH CBS Broadcast
8 Christian Broadcast Network Satellite
9 KUSA ABC Broadcast
10 Local Access Local
11 Nickelodeon/Arts Satellite
12 KBDI PBS Broadcast
13 AP Sports/News Satellite
14 Blank
*15 Home Box Office Satellite
16 Blank
*17 Showtime Satellite
18 Blank
*19 Cinemax Satellite
*20 The Disney Channel Satellite
*21 Galavision Satellite
22 Music Television Satellite
23 WGN (Chicago) Independent Satellite
24 WTBS (Atlanta) Independent Satellite
25 Lifetime Satellite
26 CNN Headline News Satellite
27 ESPN Satellite
28 USA Network Satellite
(3)
Channel Call Letters Affiliation Source
29 Blank
30 Spanish International Net. Independent Broadcast
31 KDVR Independent Broadcast
32 Cable Music Channel Satellite
33-36 Blank
Public access policy for Weld County subscribers will be
identical to those residing in Brighton. Cable Channel 10
is our designated local channel. The vast majority of our
public access activity consists of non-profit, community
public service announcements. These notices are submitted
in writing several days prior to the commencement of the
air dates.
3 & 4) Located at Jones Tri-City Intercable's offices in
Broomfield is a fully equiped mobile production van. This
van has been used in Brighton several times to produce
special events. Additionally, the Broomfield system has a
full-time production director who is available to the
Brighton system to provide assistance to those who would
like to learn more about video production techniques.
5) Jones Intercable, Inc. proposes to charge the same rates for
all services as other Brighton subscribers pay. Please see
attachment"A" which provides the current rate schedule.
6) a) The applicant is an incorporated entity.
b) Does not apply.
c) Jones Intercable, Inc. was incorporated under the laws of
Colorado on October 30, 1970 as a wholly-owned subsidiary of Jones
International, Ltd. Jones International, Ltd. is wholly-owned by
Glenn R. Jones, Chairman of the Board and Chief Executive Officer
of the company.
Following are two lists of Jones Intercable's Officers and
Directors:
Officers:
Glenn R. Jones President
Charles P. Northrop Vice President/General Counsel
Ronald E. Christensen Vice President/Human Resources
James S. Keller Vice President/Special Projects
Al Kernes Vice President/Engineering
Bennett C. Boyd Vice President/Advertising Revenues
Alan M. Angelich Vice President/Finance and Treasurer
David L. Kuhn Secretary
(4)
The address for all of the officers of Jones Intercable, Inc.
is 5275 DTC Parkway, Englewood, Colorado 80111.
Directors:
Glenn R. Jones 5275 DTC Parkway, Englewood, CO 80111
Neil E. Jones 5200 DTC Parkway, Englewood, CO 80111
Armin P. Thebus 735 S. Alton Wy. , Denver, CO 80231
Peter L. Edwards 1720 S. Bellair St. , Denver, CO 80237
William H. Sanders 1900 Emory St. , Atlanta, GA 30318
Patrick J. Lombardi 5275 DTC Parkway, Englewood, CO 80111
Those individuals who own 1% or more of Jones Intercable, Inc. 's
Common Stock and Class A Common Stock are:
Jones International Ltd. 5275 DTC Parkway, Englewood, CO 80111
Robert J. Lewis 5450 S. Chester Ct. , Englewood, CO 80111
Neil E. Jones 5200 DTC Parkway, Englewood, CO 80111
d) The Brighton office/head-end antennae site is
located at a commercial, retail site at 965 Bridge Street.
The premises are owned by a Brighton resident, James Kiyota.
Jones Intercable, Inc. has a long-term lease with Mr. Kiyota.
7) Identified as attachment "B" is a chart which illustrates the
relationship of Jones International, Ltd. with Jones Intercable,
Inc. and other businesses either partially or wholly-owned by
Jones International, Ltd.
8) Jones Intercable, Inc. has a non-exclusive cable television
franchise to operate within the city of Brighton. A copy of that
franchise has been included with this application.
9) A fully audited financial statement has been included with
this application.
10) Jones Intercable, Inc. 's Brighton system consists of a trunk
and branch coaxial cable network. The system is designed at
300mhz which will allow a maximum of 35 one-way video channels.
The single trunk system is designed for two-way operation. At this
point in time the only services to be offered are one-way (down stream)
entertainment programming services.
No local studio exists in the Brighton system. The system's local
access channel has a character generator which contains public
service announcements and other information of interest to the
community. Government agencies and other parties are encouraged
to submit their public announcements in writing to our office so
that they may be included on the access channel.
(5)
11) A letter relating to our planned network has been included
with this application.
12) The CATV system serving Brighton is directly owned by
Jones Intercable, Inc. The operating authority for this system
is revocable by the City of Brighton and has no specific
expiration date. Construction of the system was completed during
the fiscal year ending May 31, 1982. The principal governmental
officialwho is knowledgable about Jones Intercable's operations
is:
Pat McDermott
City Manager
City of Brighton
22 South 4th
Brighton, CO 80601
The next closest franchise which Jones Intercable, Inc. operates
is in the city of Broomfield. This franchise was assigned to
Jones Intercable, Inc. in 1980. Construction of the system
within the city of Broomfield was completed during the calendar
year 1981. During mid-1981, construction of a cable system
serving certain unincorporated portions of Boulder County was
begun. The Boulder County system is served from our head-end
location in Broomfield. The Broomfield franchise expires in
1991, while there is no franchise required in Boulder County.
The principal governmental official knowledgable with our
Broomfield cable operation is:
Charles Ozaki
Assistant City Manager
City of Broomfield
#6 Garden Center
Broomfield, CO 80020
Jones Intercable, Inc. either owns or manages cable operations
in nineteen states, serving more than 350,000 basic cable
subscribers. More information is available concerning these
franchises upon request.
13) None of Jones Intercable, Inc. 's officers or directors have
been convicted of any felony.
14) Jones Intercable, Inc. 's officers, management and staff have
extensive CATV experience.
Mr. Glenn R. Jones has served as Chairman of the Board and Chief
Executive Officer of the Company since its formation in 1970, and
has been President since June 1984. He is also Chief Executive
Officer and a Director of the following subsidiaries of the
Company and of International: Cable Ads, Ltd. , Colorado Cable
Properties, Inc. , Colorado Intercable, Inc. , Data Transmission, Inc. ,
(6)
Evergreen Intercable, Inc. , International Aviation, Ltd. , Jones
Futura Foundation, Ltd. , Jones Information Management, Inc. ,
Jones Intercable of California, Inc. , Jones Intercable of L.A.
County, Inc. , Jones Properties, Inc. , Jones Tri-City Intercable,
Inc. , Saturn Cable T.V. , Inc. , Starsearch, Ltd. , The Jones Group,
Ltd. , Tri-Comm Systems, Inc. Spacelink, Ltd. is a publicly-held
corporation whose stock is registered under Section 12 (g) of the
Securities Exchange Act of 1934. In addition, he has been the sole
shareholder, Chief Executive Officer and a Director of International
since its formation in 1969. Mr. Jones has been involved in the
cable television business in various capacities since 1961. Mr.
Jones is a graduate of the University of Colorado law school and has
completed the Stanford Executive Program at the Stanford University
Business School. He is the brother of Neil E. Jones.
Mr. Alan M. Angelich joined the Company in May 1982, was elected
Treasurer in July 1982, and Vice President/Finance in June 1984.
From 1968 to 1981, Mr. Angelich was with Arthur Andersen & Co. ,
certified public accountants, and from 1981 until he joined the
Company, Mr. Angelich was a management and accounting consultant
to several private clients. He received a B.A. in Accounting from
the University of Illinois and a MBA from DePaul University.
Mr. Charles P. Northrop joined the Company in February 1984 and
in June 1984 became Vice President/General Counsel. He is also an
officer of International. Mr. Northrop's responsibilities include
managing the legal affairs of the Company, and he also heads a
number of administrative departments. Mr. Northrop has 18 years of
legal experience and has held executive and administrative positions
throughout his career.
Mr. Alan M. Kernes joined the Company in July 1981 as Director of
Engineering. He was elected Vice President/Engineering in April 1982,
and is responsible for all engineering for the systems managed and
owned by the Company. Prior to joining the Company, Mr. Kernes
was employed by American Television and Communications Corp. in
various positions including Western Regional Engineer, New Systems
Development Engineer, and finally Division Manager of the Construction
Division. He received a Bachelor of Science Degree in Electrical
Engineering from California State University of Long Beach in 1971.
Mr. Scott Campbell joined the Company as Vice President/Marketing in
November 1983. Mr. Campbell is responsible for developing marketing
policies and procedures which can by implemented by CATV systems to
increase subscriber revenues. From 1982 to 1983 Mr. Campbell was
employed by American Cable Connection, Inc. as Senior Vice President-
Marketing. From 1969 to 1982 he was employed by E.I. DuPont de
Nemours Co. , Inc. as a District Manager-Riston Products Division.
He received a B.S. degree in marketing from the University of
Delaware in 1969 and pursued graduate studies at Temple University
through 1971 .
(7)
Local Management and Staff:
The Brighton system has a staff of three based in that City's
office. Installation, service and billing operations are all
conducted from the local office. The Brighton system receives
management and technical support from Jones Intercable's
Broomfield system office.
Manager for both the Broomfield and Brighton systems is William
R. Sisk. Mr. Sisk joined Jones Intercable, Inc. as a system
manager in January 1981. He received his B.S. degree in
finance from the University of Colorado.
Technical supervision is provided by Chief Technician, Mark
Ahrens, who is based in Broomfield. Mr Ahrens has an extensive
background in cable operations and construction.
Charlotte Vurciaga is the office manager for the Brighton
system. She processes billing, and schedules all service and
installations. The two field personnel include a service
technician and an installer (ie. James Dyke, Jr. and David
Bremkamp, respectively) . Each of the three on-site Brighton
employees have more than several years of cable experience.
15) As currently envisioned the extension of cable plant into
Weld County from Brighton would serve the Syl-Mar Manor Park
which consists of roughly 95 dwelling units. Any future
expansion of cable operations in Weld County would be contingent
upon enough density of dwelling units to justify the capital
outlay. Generally speaking, we are interested in expanding
service to areas that have at least 35-40 homes per mile of
plant.
If there is any additional information that we can provide, please
feel free to contact us.
Regards, ////
Ronald Schmitt
Division Vice President
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JONES INTERCRBLE,
659-8170
965 Bridge Street
Brighton, Colorado 80601
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WAIVER OF REQUIREMENTS - JONES INTERCABLE
This applicant has requested that certain portions of the Weld County
Cable TV Ordinances be waived with respect to its franchise in
accordance with the Waiver of Requirements Section of the Weld County
Cable TV Ordinances. In determining whether to grant such waivers, you
must find that the applicant proposes, and will serve less than 500
subscribers in Weld County. You should also require a showing of good
cause by the applicant for each waiver requested. Good cause may be
shown by the submission of supporting documents and materials tendered
with the application or by testimony adduced at the hearing. This
applicant has requested waivers to the Ordinance sections attached
hereto as conditioned and set forth below:
1. Upon application, waiver of the hearing requirements of
paragraph D, Sections 2 through 7, RATE/SPECIAL MONTHLY
SERVICE RATES/DEPOSITS, if the rate requested is identical to
and has been approved by the City of Brighton for subscribed
within said City, after a public hearing which substantially
comports with the due process requirements of this heading.
2. Since this applicant also operates in other counties, it is
requesting that the franchise fee set forth in the FRANCHISE
FEE heading apply only to the gross revenues of the company
received from subscribers in Weld County.
3. That Section B of the heading COMPANY SERVICES be met by the
applicant's inclusion of announcements of public interest on
their public access channel in operation for the City of
Brighton.
4. That Section C of the heading COMPANY SERVICES be met by the
availability of all applicant' s facilities and equipment,
available to the City of Brighton for utilization within the
franchised area as contemplated by said section.
5. That Sections B and C of the heading EMERGENCIES be waived as
to this franchise and that Section A be met by making
applicant' s facilities available to the City of Brighton in
accordance with the terms thereof.
ARTHUR ANDERSEN R Co.
DENVER, COLORADO
TO JONES INTERCABLE, INC. :
We have examined the consolidated balance sheets of JONES
INTERCABLE, INC. (a Colorado corporation) and subsidiaries as of May 31,
1984 and 1983, and the related consolidated statements of income,
shareholders ' investment and changes in financial position for each of
the three years in the period ended May 31 , 1984. Our examinations were
made in accordance with generally accepted auditing standards and,
accordingly, included such tests of the accounting records and such other
auditing procedures as we considered necessary in the circumstances.
In our opinion, the consolidated financial statements referred
to above present fairly the financial position of Jones Intercable, Inc.
and subsidiaries as of May 31, 1984 and 1983, and the results of their
operations and the changes in their financial position for each of the
three years in the period ended May 31 , 1984, in conformity with
generally accepted accounting principles applied on a consistent basis.
c /L CA-„>is2ec& — Co
ARTHUR ANDERSEN & CO.
Denver, Colorado,
August 3, 1984
-18-
CONSOLIDATED Jones Intercable, Inc.
BALANCE SHEETS and Subsidiaries
As of May 31, 1984 and 1983
ASSETS 1984 1983
CASH AND CASH EQUIVALENTS $ 2,693,600 $ 8,917,300
RECEIVABLES:
Trade receivables , less allowance for doubtful
receivables of $22,200 in 1984 and $21 ,200 in
1983 149,100 96,700
Affiliated entities (Note 4) 10, 714,600 4,884,000
Other 112 ,200 159 ,600
INVESTMENT IN CABLE TELEVISION PROPERTIES
(Notes 1 , 2, 3, 4, 5, 11 and 12) :
Property, plant and equipment , at cost 21 ,839 ,700 13 ,284,900
Less— Accumulated depreciation (4,967,400) (3,631,200)
16,872,300 9,653 ,700
Franchise costs, net of amortization of
$296,700 in 1984 and $192,000 in 1983 1,311 ,600 578,800
Cost in excess of interests in net assets purchased,
net of amortization of $239 ,900 in 1984 and $193,300
in 1983 213,100 259,700
Investments in cable television limited partnerships
and corporate stock 1,424,200 1,697 ,500
TOTAL INVESTMENT IN CABLE TELEVISION PROPERTIES 19,821 ,200 12,189, 700
OTHER ASSETS (Note 4) 2,292,700 550, 100
TOTAL ASSETS $35 ,783 ,400 $26 ,797 ,400
The accompanying notes to consolidated financial statements are an integral part of
these balance sheets.
CONSOLIDATED Jones Intercable, Inc .
BALANCE SHEETS and Subsidiaries
•
As of May 31 , 1984 and 1983
LIABILITIES AND SHAREHOLDERS' INVESTMENT 1984 1983
LIABILITIES :
Accounts payable $ 342,300 $ 293,700
Subscriber prepayments and deposits 467,500 248,300
Accrued liabilities (Note 9) 1,468,000 1 ,239 ,200
Accrued losses in limited partner—
ships (Note 4) 537 ,400 366 ,300
Income taxes payable (Note 6) — 1,459 ,900
Debt (Note 5) 10,677,600 5 ,098,000
TOTAL LIABILITIES 13,492,800 8,705 ,400
DEFERRED INCOME TAXES (Note 6) 2,539,000 875 ,900
COMMITMENTS (Note 10)
•
SHAREHOLDERS ' INVESTMENT:
Class A Common Stock, $ .01 par value, 15,000,000 shares
authorized; 3 ,503,793 and 3,056 ,656 shares issued and
outstanding at May 31 , 1984 and 1983, respectively
(Notes 7 and 8) 35,000 30,600
Common Stock, $ .01 par value, 5,550,000 shares
authorized; 5 ,493 ,939 and 5,475,839 shares issued and
outstanding at nay 31 , 1984 and 1983, respectively
(Note 7) 55,000 54,800
Additional paid-in capital 19,012,300 16,836 ,800
Retained earc' ngs 961,200 293,900
Less: 66 ,500 shares of Common Stock and Class A
Common Stock held in Treasury, at cost (311,900) -
TOTAL SHAREHOLDERS ' 1RVESTM NT 19,751,600 17 ,216 , 100
TOTAL LIABILITIES AND SHAREHOLDERS' INVESTMENT $35,783,400 $26,797,400
The accompanying notes to consolidated financial statements are an integral part o
these balance sheets .
1.
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CONSOLIDATED STATEMENTS OF INCOME Jones Intercable, Inc.
For the years ended May 31, 1984, 1983 and'1982 and Subsidiaries
1984 1983 1982
REVENUES FROM CABLE TELEVISION OPERATIONS
(Note 4) :
$
Subscriber service $ 7,486,300 5 ,141 ,000 $ 4,035 ,300
Management fees 2,534,300 1,743 ,900 937,600
CAIIV Fund fee and distribution 1,165 ,000 — 2,417,000'
TOTAL REVENUES 11,185,600 6,884,900 7,389,900
OPr ATING, GENERAL AND ABMIN1ST TI E
EXPENSES 5 ,241,100 3 , 845,100 3 ,525,100
OPERATING INCOME 5,944,500 3,039,800 3,864,800
OTHER INCOME (EXPENSE) :
Interest expense (Note 5) (979 ,700) (709 ,100) (361 ,600)
interest capitalized during construction — — 49,800
Depreciation and amortization (Note 1) (1,496 ,700) (1,007,600) (765,100)
Equity in losses of limited partnerships (405,000) (399,200) (116,800)
Interest income (Note 4) 1,123,500 1,769,500 1,238,400
Other, net 60,900 (174,500) (186 ,900)
INCOME BEFORE INCOME TAXES AND
EXTRAORDINARY ITEM ' - 4,247 ,500 • 2,518 ,900 3 ,722 ,600
Income tax provision (Note 6) (1,591,800) ($30,700) (1 ,48530_;
INCOME BEFORE EXTRAORDINARY ITEM 2,655 ,700 1,588,200 2,237 ,300
EXTRAORDINARY ITEM:
Gain on sale of marketable securities , net
of related provision for income taxes of
$78,300 (NDte 12) 167 ,400 —
NET INCOME - $ 2,655 ,700 $1 ,755 ,600 $2,237 ,300
NET INCOME PER CLASS A COMMON AND COMMON
sakRE (Note 1) :
Income before extraordinary item $ .30 $ .18 $ .25
Extraordinary item — .02 —
NET INCOME PER CLASS A COMMON AND COMMON
SHARE ---\$ .30 $ .20 $ _25
•
AVERAGE NUMBER OF CLASS A COMMON AND COMMON
SHARES OUTSTANDING (Noce 1) 8,972 ,000 8 ,951 ,800 8 ,855 ,9_0
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CONSOLIDATED STATEMENTS OF Jones Intercable, Inc.
CHANGES IN FINANCIAL POSITION and Subsidiaries
For the years ended May 31, 1984, 1983 and 1982
1984 1983 1982
SOURCES OF CASH:
Operations—
Income before extraordinary item $ 2,655 ,700 $ 1,583,200 $ 2,237 ,300
Items not requiring (providing) cash-
Depreciation and amortization 1 ,496 ,700 1 ,007,600 765 ,100
Deferred income tax 1 ,900,000 (534 ,000) 1,427,800
Equity in losses of limited
partnerships 405 ,000 399,200 116 ,800
TOTAL FUNDS FROM OPERATIONS 6,457 ,400 2 ,461 ,000 4,547,000
Extraordinary item- Gain on sale of
marketable securities, net of related
provision for income taxes - 167 ,400 -
Proceeds from borrowings 8,500,':00 3, 100,000 1,521,800
Proceeds from sale of temporary invest-
ment in cable television limited
partnership - 1 ,677 ,100 -
Issuance of Class A Common Stock - - 328,200
Proceeds from stock options exercised 198,800 65,700 209 ,400
TOTAL SOURCES 15,156,200 7 ,471 ,200 6,606,400
USES OF CASH:
Repayment of debt 2,920,400 1,223,600 57 ,800
Purchase of cable television system 6,500,000 - -
Purchase of property, plant and
equipment, net 2,958 ,900 1,839,000 4,025,900
Investments in cable television limited
partnerships and corporate stock 49 ,500 1,543,500 1 ,275,000
Increase (decrease) in advances to
limited partnerships 5,830,600 (2,733,100) 4,745,700
Purchase of Treasury stock, at cost 311,900 — —
Decrease (increase) in income taxes payable 2,286,600 (1,459,900) -
Changes in payables, accruals and
other, net 522,000 7,200 (543,800)
TOTAL USES 21,379,900 420,300 9,560,600
INCREASE (DECREASE) IN CASH $(6,223 ,700) $ 7,050,900 $(2,954,200)
The accompanying notes to consolidated financial statements are an integral part of
these statements.
NOTES TO CONSOLIDATED Jones Intercable, Inc.
FINANCIAL STATEMENTS and Subsidiaries
For the years ended May 31 , 1984, 1983 and 1982
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
Jones Intercable, Inc. (the "Company") was formed in 1970 as a wholly owned subsidiary ci
Jones International, Ltd. ("International"). Subsequent sales of shares of Common Stock
by International and issuances of shares of such stock by the Company to third parties have
reduced International's ownership to approximately 53 percent of the Common Ftock at May
31 , 1984. In December 1980 , the Company also issued 2,000,000 shares of Class A Common
Stock (Note 8). At May 31, 1984, International retained beneficial ownership cf
approximately 12 percent of such Class A Common Stock.
The Company and its subsidiaries own and operate cable television systems. The Company
also manages cable television systems owned by limited partnerships for which it is
General Partner. In addition, certain cable television systems owned by other related
entities were managed by the Company (Note 2) .
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly
owned subsidiaries. The Company's investment., in managed limited partnerships are
carried at cost plus its proportionate share of profits and losses relating to its equity
position. All significant intercompany transactions have been eliminated in consol-
idation.
Property, Plant and Equipment
Prior to receiving the first revenues from subscribers of a cable television systec_
constructed by the Company, all construction costs, operating expenses and interest
related to the system are capitalized. From the time of such receipt until completion of
construction, but no longer than two years (defined as the "prematurity period"), portions
of certain fixed operating expenses and interest are capitalized in addition to direct
construction costs. The portions capitalized are decrease as progress is made toward
obtaining the subsc_iber level expected at the end of the prematurity period, after which
no further expenses are capitalized. In addition, costs (including labor, overhead and
other costs of completion) associated with installation in homes not previously served b:
cable television are capitalized and included as "distribution systems." Total
expenses, other than interest, capitalized during each c: the three years ended May 31 ,
1984, 1983 and 1982 were $392,700, $237 ,500 and $201 ,600, respectively.
Depreciation of property, plant and equipment is provided using the straight-line method
over the following estimated service lives:
Distribution systems including capital-
ized interest and operating expenses Primarily 15 years
Buildings 10-20 years
Equipment and tools 3-15 years
Premium service equipment 3-15 years
Earth receive stations 5-15 years
Vehicles 3-10 years
Other property, plant and equipment 1-15 years
Franchise Costs
Costs incurred in obtaining cable television franchises and other operating authorities
(collectively referred to as "franchises") are initially deferred and amortized over the
life of the franchises beginning with the dates the systems become operational. If
becomes apparent a franchise will cot be obtained, related deferred costs are charged to
expense. Franchise rights acquired through purchase of subsidiary companies are stated
at estimated fair valise at the date of acquisition and amortized cver the remaining terms
of the franchises . Amortization is determined using th_ straight—line method over livee
of seven to twenty years.
Cost in Excess of interests in Net Assets Purchased
The cost of purchased interests in subsidiaries in excess of the fair values of net asset:
acquired is being amortized over the same period as the related franchise costs using the
straight—line method.
Income Taxes
Provision is made for deferred Federal and state income taxes arising from timing
differences in the determination of incom for financial reporting and tax purp-ses .
Investment tax credits are treated as reductions of income tam expense during the year i_
which the related asset is placed in service.
Net Income Per Share of Class A Common Stock and Common Stock
Net income per share of Class A Common Stock and Common Stock is based on the weighted
average number of shares outstanding during the periods. Stock options and warrantshae
not been included in these calculations because their effect is insignificant.
Applicable per share information has been restated to reflect dividends declared in fiscal
1984, 1983 and 1982 (see Note 8).
2 . TRANSACTIONS WITH RELATED PARTIES
The Company's parent , International , is wholly owned by Glenn R. Jones, Chairman
rman of the
Board, Chief Executive Officer, and President of the Company. The Company and the limited
partnerships for which the Company is General Partner (Note 4) have had, and will continue
to have, certain transactions with subsidiaries and/or affiliates of International.
Principal recurring transactions are described as follows:
The Jones Group, Ltd. , a wholly owned subsidiary corporation of International, performs
brokerage services for the Company and the limited partnerships. For brokering the
acquisition of cable television properties for the partnerships , the partnerships pay The
Jones Group, Ltd. fees which are equal to 4 .75 percent for Cable TV Funds 10 and 11 and
percent for all prior partnerships of the lower of purchase price or appraised value of the
properties. Brokerage fees paid to The Jones Group, Ltd. by the partnerships are
summarized as follows:
Paid By
Partnerships
Year ended May 3'.-
1984 $5,676 ,300
1983 3,219 ,500
1982 1 ,525,600
•
During fiscal 1983 , the Company performed management services for Colorado Intercable,
Inc. ("CIC"), an 89 percent owned subsidiary -of International, and managed three cable
television systems in Georgetown, Idaho Springs, and Jefferson County, Colorado which
were owned by CIC. In March 1983, the Georgetown and Id._ho Springs systems were sold to
another affiliate of International, which now owns and manages these two systems . As more
fully discussed in Note 3, the Company, through a wholly owned subsidiary, purchased the
Jefferson County system from CIC on June 30, 1983 .
The Company and its subsidiar_es lease earth receive stationb and vehicles from Data
Transmission, Inc. , a wholly owned subsidiary of International. The earth receive
station leases have been capitalized (Note 5) . Lease payments for the three years ended
May 31, 1984, 1983 and 1982 were, respectively, $79,800, $58,800 and $52,400.
Beginning in January of 1983 , Jones Information Management, Inc. was formed as a wholly
owned subsidiary of International to provide information management and data processing
services for all companies affiliated with International. Charges to the various
operating companies are based on usage of computer time by each entity. Fees charged tc
the Company and its affiliated partnerships for the five months ended May 31 , 1983 and the
year ended May 31 , 1984 totalled $118 ,800 and $424,900, respectively.
International Aviation, Ltd. , a wholly owned subsidiary of International, was formed i0
March 1983 , to capture costs associated with the operation of an aircraft owned by
International Aviation, ltd. Charges to the Company- are based on usage of the aircraft by
corporate personnel . Payments to International Aviation, Ltd. for the two months ender.
May 31, 1983 and the year ended May 31 , 198!4. were $89,400 and $234,500 , respectively.
In June 1984, the Company entered into a lease with Jones Properties, Inc. , a wholly owned
subsidiary of International, under which the Company has agreed to lease a 97,100 square
foot office building to be constructed in Englewood, Colorado. This office building, in
which the Company' s new corporate offices will be located, is scheduled for completion i__
late summer of 1985 . The lease has a 10-year term with three 5-year renewal options . The
annual rent will not exceed $19 .50 per square foot, plus operating expenses, until
December 31 , 1987 , and will not exceed $24 .00 per square foot, plus operating expenses ,
thereafter. The Company plans to sublease approximately 35`7. to 40,E of the building to
International and certain affiliates of International.
3 . ACQUISITIONS
In February 1982, the Company, through a wholly owned subsidiary, acquired the cable
television system serving Evergreen, Colorado, along with certain other assets, from
Evergreen Special CATV Fund for $521 ,500 cash and the assumption of approximately $470,00 ,
in debt . The Company was previously the General Partner for Evergreen Special CATV Fund.
As General Partner, the Company received approximately $95 ,500 as its share of the
distribution. proceeds. This amount has been recorded as a reduction of the purchase
price.
On June 30, 1983, the Company, through a wholly owned subsidiary, purchased the cable
television system serving Jefferson County, Colorado from an affiliated company fcr
$6 ,500,000 . The unaudited comparative pro forma effect of this acquisition on the
results of operations , assuring this transaction had occurred as of the beginning of the
respective fiscal periods are as follows:
For the Year Ended May 31, 1984 For the Year Ended May 31, 1983
Pro Forma Pro Forma Pro Forma Pro Fcrm
May 31, 1984 Adjustments May 31 , 1984 May 31 , 1983 Adjustments May 3_ , 1'
Total Revenues $11 ,185,600 $135 ,200 $11 ,320,800 $ 6,884,900 $1,295,500 $ 8, 180,4;
Income before
extraordinary
item $ 2,655 ,700 $(21 ,800) $ 2,633 ,900 $ 1,588,200 $ (653 ,200) $ 935 ,0;
Extraordinary
item $ — $ — $ — $ 167 ,400 $ — $ 167 ,40
Net income
(loss) $2 ,655 ,700 $(21 ,800) $ 2,633,900 $ 1,755 ,600 $ (653 ,200) $ 1 ,1 .0 ,4'
Income before
extraordinary
item $ .30 $ — $ .30 $ .18 $ ( .07) $ .11
Extraordinary
item — — — .02 — .02
Net income (loss)
per share $ .30 $ — $ .30 $ .20 $ ( .07) $ .13
4. MANAGED LIMITED PARTNERSHIPS
The Company is General Partner for a number of limited partnerships formed to acquire,
construct, develop and operate cable television systems. Partnership capital has been
raised principally through a series of public offerings of limited partnership interests.
The Company makes a capital contribution of $1 ,000 to each partnership and is allocated 1
percent of all partnership profits and losses . The Company may also purchase limited
partner interests is the partnerships and participates wi_h respect to such interests on
the same basis as other limited partners . As General Partner, the Company is contingently
liable for all recourse debt of the partnershipc to unrelated entities which, in the
aggregate, totalled approximately $23,455 ,000 at :ay 31 , 1984 . This partnership debt is
secured by partnership assets at a fair market value estimated to be significantly in
excess of this debt .
As General Partner, the Company defers costs of limited partnership public offerings and
costs of formation of each limited partnership. These costs are reimbursed by the
partnerships formed, and have been subject to a limitation of 3 percent of partnership
units sold. Any costs in excess of this limitation are borne by the Company and expensed.
At May 31 , 1984, the Company had ircurred $730 ,800 of Cable TV Fund 11 offering costs which
have not been reimbursed.
A wholly owned subsidiary of the Company receives a fee of 10 percent of the capital
contributed by the limited partners from which is paid all sales commissions of
participating broker—dealers . The fees received, less commissions and other
underwriting expenses paid, are treated as an increase or (reduction) of operating,
general and administrative expenses and amounted to $(90 ,800) , $(14,800) and $29 ,000 for
the years ended May 31 , 1984 , 1983 and 1982 , respectively.
As General Partner, the Company manages the partnerships and receives a fee for its
services generally equal to 5 percent of the g _oss revenues of tie partnerships, excluding
revenues from the sale of cable television syst_ms er franchises.
Any partnership distributions made from cash flow (defined as cash receipts derived from
routine operations, less debt principal and 'interest payments and cash expenses) are
generally allocated 99 percent to the limited partners and 1 percent to the General
Partner. With respect to partnerships formed after February 1978, any distributions
other than from cash flow, such as from sale or refinancing of the system or upon
dissolution of the partnership, are generully made as follows: first, to the limited
partners in an amount which, together with all prior distributions, will equal the amount
initially contributed to the partnership capital by the limited partners; and the balance,
75 percent to the limited partner and 25 percent to the General Partner. During January
1982 and February 1984, C>TV Funds V and VI sold their respective cable television systems
for which the Company received approximately $2,417,000 and $1,165 ,000 in each of these
years.
Partnerships reimburse the Company for certain allocated overhead and administrative
expenses. These reimbursements genera,.?.y are limited to 25 percent of the gross revenues
of each partnnrship. Allocations of personnel costs are based primarily on actual time
spent by Company employees with respect to each partnership. Other overhead costs are
allocated primarily based on the cost of partnership assets managed. Company owned
systems are also allocated a proportionate share of these expenses. Reimbursements fron
partnerships and other affiliated companies directly offset operating, general and
administrative expenses by approximately $6,973,600, $5,012,900 and $3,017 ,800 for the
three years ended May 31, 1984, 1983, and 1982, respectively.
In addition, the Company has made advances to certain of the limited partnerships and has
deferred the collection of management fees and expense reimbursements owed by certain
limited partnerships primarily to accommodate expansion and other cash needs of the
partnerships. Such advances bear interest at rates comparable to the Company's cost of
borrowing. Interest charged to the limited partnerships for each of the three years ended
May 31 , 1984, 1983 and 1982 were $941 ,300, $1,713,000 and $1,222,200, respectively.
Amounts outstanding are reflected in the following summary sf receivables from affiliated
entities as of May 31 .
1984 1983 1982
Accounts receivable from--
Limited partnerships and managed companies $ 9,725,400 $ 3 ,894 ,800 $ 1 ,029,000
Affiliated entities - - - 1 ,60
Notes receivable from limited p€L , _ershi_ s 900,000 900,000 6,497 ,300
Long-term notes receivable from CIC, 7% and 10% 89,200 89,200 89,200
Total receivables from affiliated entities $10,714,600 $ 4 ,884,000 $ 7 ,617 ,1. 0
5. DEBT
Debt, as of May 31 , consists of the following:
1984 1983
LENDING INSTITUTIONS
Revolving credit and term loan $10,500,000 $2,000,000
Secured installment notes due 1934 through
1991, notes bearing interest rates ranging
from 12% to 19 .5% 45 ,800 2,754,500
RELATED ENTITIES
10% secured note to Colorado Intercable, Inc.
paid in 1983 - 309,100
15% to 16.75% capitalized equipment lease
obligations due in installments through 1987 131 ,800 34,400
Total debt S10,677 ,600 S5,098,000
The Company's revolving credit and term loan agreement provides for a loan of up to
$20,000,000 tl:at matures on December 31, 1986, at which time any outstanding balance= y be
converted into a term loan payable in twenty consecutive quarterly installments. The
interest rate is at the Ca:.pany's option of prime plus 1/2 percent or the London Interbank
Offered Rate (LIBOR) plus 1 1/4 percent. A fee of 1/2 of 1 percent per annum on the un-u; ed
portion of the commitment is also required.
Substantially all of the assets of the Company are pledged as secu-:ity for eithe-7 the line
of credit or the installment notes outstanding at May 31, 1984. On July 25, 1984, t .e
Company repaid the balance of its revolving line of credit ($12,000,000) with a portion of
the proceeds of the bond offering discussed below. The Company is presently
renegotiating its line of credit and until an acceptable agreement between the banks and
the Company has been reached, the banks shall not be obligated to make any advances under
the line of credit and the Company shall not be obligated to pay any commitment fee.
On July 24, 1984, the Company completed the placement of $35,000,000 of 14 .50 percent
Subordinated Debentures due August 1, 1994. Interest on such debentures will be payable
semi-annually on February 1 and August 1 of each year. Each $1,000 debent•.-.re was sold to
the public at a price of $892.38. The Debentures provide for an annual sinking fund
payment of $7,777 ,778 comc:encing August 1 , 1991, calculated to re`.-'.re 66 2/3 percent cf t :
issue prior to maturity. The Debentures are redeemable µt any time on or after August 1,
1989, at the Company's option, in whole or in part at 100 percent of the principal amount,
plus accrued interest to the redemption date.
6. INCOME TAXES
Components of income tax expense and an analysis of deferred income taxes for Federal
and state income tax purposes are as follows:
1984 1983 1982
Current provision (benefit)-
Federal $ (279,500) $1 ,362,400 $ 31,100
State (28,700) 180,600 26,400
Total current provision (benefit) (308,200) 1 ,543,000 57,500
Deferred provision (benefit)-
Federal 1 ,701 ,700 (54,800) 1,278,900
State 198,300 (479,200) 148,900
Total deferred provision (benefit) 1,900,000 (534,000) 1 ,427,800
Total income tax provision $1,591,800 $1,009,000 $1,485,300
The provision for deferred income taxes is the result of the following timing
differences:
1984 1983 1982
Additional tax depreciation $ 952,300 $ 487,000 $ 304,600
CATV Fund fee and distribution 565,000 (1,060,200) 1,060,200
Capitalized overhead 88,500 115,700 36,600
Deferred compensation (10,500) (6,200) (7,200)
Increase (decrease) in timing of
partnership losses 231 ,000 (53,600) 4,900
Reduction in basis from full uili-
zation of investment tax credits 79,500 - -
Other (5,800) (16,700) 28,700
Components of deferred tax
provision (benefit) $1 ,900,000 $ (534,000) S1 ,427 ,800
The following table reconciles the statutory Federal income tax rate to the effective tax
rate:
1984 1983 1982
Computed "normally expected"
income tax provision at
statutory rates - income before
extraordinary item $1 ,913,500 $1 ,138,700 $1 ,647 ,300
Increases (reductions) in taxes
resulting from-
Investment tax credits recognized (503 ,000) (320,000) (309 ,000)
Reduction in basis from full utili-
zation of investment tax credits 79 ,500 - -
Non deductible depreciation 20,000 20,000 20,000
Amortization of costs in excess
of interests in net assets
purchased 23,100 23 ,100 23 ,100
State income taxes, net of
Federal income tax benefit 96,600 67 ,900 100,700
Other (37 ,900) 1,000 3,200
Provisio❑ for income taxes -
income before extraordinary item 1 ,591,800 930,700 1,485,300
Provision for income taxes,
extraordinary item _ - 78,300 -
Total income tax rrovision $1,591,800 $1,009,000 $1 ,485,300
7. COMMON STOCK OPTIONS
In 1979 the Company reserved a maximum of 50,000 shares of Common Stock for grantir:g,
options to officers and key employees at a price of $.50 par share. At May 31, 196L ,
options to purchase 40,000 shares had been granted, of which options to purchase 33,800
shares had been exercised and options to purchase 1 ,100 shares had been forfeited upon
resignation of the holders.
In July 1981 the shareholders approved the adoption of a nonqualified stock option and
stock appreciation rights plan. Options to purchase 650,000 shares of the Company's
Class A Common Stock may be granted to key employees at a price equal to the fair market
value of the stock at the date of grant. In November 1983 the shareholders approved a
resolution to increase the number of opticns available for grant to 1,500,000 sh-:res.
Options granted become exercisable in equal installments over a four year period or in such
installments as determined by the committee administering the plan. As of May 31 , 1984,
options to purchase 791,876 shares had been granted of which options to purchase 2,461
shares had been exercised and opticns to purchase 127,225 shares had been forfeited upon
resignation of the holders.
In addition, the shareholders approved the grant of options to purchase 60,000 shares of
Class A Common Sto..k exercisable at $ .50 per share to an officer of a subsidiary of the
Company. Subsequent stock dividends increased the amount of shares available through the
exercise of these options by 2,586 shares. As of May 31, 1984, all 62,586 shares had been
purchased upon exercise of these options .
In February 1984, the Board of Directors adopted a nonqualified stock option plan to
provide for the grant of stock options to key contributors to the Company. Options to
purchase 250 ,000 of the Company's Class A Common Stock mcy be granted to an officer,
employee, director, or independent consultant to the Company, or any affiliate whose
judgement, initiative and efforts are expected to contribute to the successful conduct of
the Company. Option° granted at a price equal to the fair market value of the stock at the
date of grant become exercisable in equal installments over a four year period or in such
installments as determined by the committee administering the plan. As of May 31, 1984 ,
options to purchase 105 ,000 shares had been granted and none were exercised.
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'Fear .. Ke,
I wc, c'. like Lp , .a a clay i t with r•- _t to our CAT e `r. aj. i e
" eted. A- . "Plow. our prim.primoty fotemtf, :!ppof .n n. Ling i cchise is ._ able us to , .ovide service to the fy, .
`Tar ?. : pr ptnent L c.+terl d1.cent t, the Aiams County lime.
foe
nrepo,e• L m c4e r'4, entire ?.3rk which is r.nehly lc') units.
^_s vuu cau tell toy the map of the ❑rea in quest ion, there is really no
pep,_;l -:r lop den - it•: to cpeak of I 'im4 outside ti the Syl-Mar Park Manor
:Level r,cent. In the future we wo_I d extend service to areas outside cf
S-71-'L,r if the density of d'wellinps justifies our capital expense. Our
general fuidel .nen for such eaLensicns would require approximately 35-40
dwellipgsilniie of plant.
I hope this clears up any cc Bunion as to our CATV franchise application.
F,..
William R. Sisk
System Manager- Brighton, Broomfield
60 Garden Center. Suite 202, Broomfield. Colorado 80020 303/466-7376
Hello