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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF
1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
CABLE TV FUND 11-B, LTD.
-----------------------------------------------------
(Name of Registrant as Specified In Its Charter)
N/A
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[_] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies: Limited
Partnership Interests
(2) Aggregate number of securities to which transaction applies: 38,026
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined): Pursuant to
Rule 0-11(c)(2), the transaction valuation is based upon the $84,000,000
sales price that is to be paid to Cable TV Fund 11-B, Ltd. in connection
with the transaction that is the subject of the proxy solicitation.
(4) Proposed maximum aggregate value of the transaction: $84,000,000
(5) Total fee paid: $16,800
[X] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
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REVISED PRELIMINARY COPY
[LOGO OF JONES INTERCABLE APPEARS HERE]
9697 EAST MINERAL AVENUE
ENGLEWOOD, COLORADO 80112
NOTICE OF VOTE OF THE LIMITED PARTNERS OF CABLE TV FUND 11-B, LTD.
To the Limited Partners of Cable TV Fund 11-B, Ltd.:
A special vote of the limited partners of Cable TV Fund 11-B, Ltd. (the
"Partnership") is being conducted through the mails on behalf of the
Partnership by Jones Intercable, Inc., the general partner of the Partnership,
for the purpose of obtaining limited partner approval of the sale, to an
unaffiliated third party, of the Partnership's cable television system serving
the communities of Barker, Clarence, Elma, Lancaster, Lockport, Newfane,
Orchard Park and Somerset, all in the State of New York (the "New York
System"), for $84,000,000 in cash, subject to normal working capital closing
adjustments that may have the effect of increasing or reducing the purchase
price by a non-material amount. Information relating to this matter is set
forth in the accompanying proxy statement.
If the limited partners approve the proposed sale of the New York System and
if the transaction is closed, the Partnership will distribute the net sale
proceeds to its partners of record as of February 29, 1996, and it is estimated
that the limited partners will receive $1,101 for each $500 limited partnership
interest, or $2,201 for each $1,000 invested in the Partnership. Once the
distribution of the net proceeds from the sale of the New York System has been
made, limited partners will have received a total of $1,601 for each $500
limited partnership interest, or $3,201 for each $1,000 invested in the
Partnership, taking into account the distributions to limited partners made in
July 1990 and July 1992. The Partnership will continue to own an 8 percent
interest in the cable television system serving Manitowoc, Wisconsin through
its investment in the Cable TV Joint Fund 11, until that system also is sold.
Cable TV Joint Fund 11 has entered into an agreement to sell the Manitowoc
system to a wholly owned subsidiary of Jones Intercable, Inc. Closing of the
sale of the Manitowoc system is subject to certain closing conditions that have
not yet been satisfied, including the approval of the holders of a majority of
the limited partnership interests in each of the Partnership, Cable TV Fund 11-
A, Ltd., Cable TV Fund 11-C, Ltd. and Cable TV Fund 11-D, Ltd. Information
about the sale of the Manitowoc system will be set forth in a separate proxy
statement to be sent to the limited partners of the Partnership in connection
with a separate vote of the limited partners of the Partnership to approve that
transaction. Upon the closing of the sale of the Partnership's New York System
and Cable TV Joint Fund 11's Manitowoc system, the Partnership will be
liquidated and dissolved.
Only limited partners of record at the close of business on December 31, 1995
are entitled to notice of, and to participate in, this vote of limited
partners. It is very important that all limited partners participate in the
voting. The Partnership's ability to complete the transaction discussed in the
Proxy Statement and the Partnership's ability to make a distribution to its
partners of the net proceeds of the sale of the Partnership's New York System
pursuant to the terms of the Partnership's limited partnership agreement are
dependent upon the approval of the transaction by the holders of a majority of
the Partnership's limited partnership interests.
The proposal that is the subject of this proxy solicitation will be adopted
only if approved by the holders of a majority of the limited partnership
interests. Each limited partnership interest entitles the holder thereof
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to one vote on the proposal. Because the Partnership's limited partnership
agreement (the "Partnership Agreement") requires that the proposal to sell the
New York System be approved by the holders of a majority of the limited
partnership interests, abstentions and non-votes will be treated as votes
against the proposal. A properly executed consent returned to the General
Partner on which a limited partner does not mark a vote will be counted as a
vote for the proposed sale of the New York System. Because limited partners do
not have dissenters' or appraisal rights in connection with the proposed sale
of the New York System, if the holders of a majority of the limited partnership
interests approve the proposal, all limited partners will receive a
distribution of the net sale proceeds in accordance with the procedures
prescribed by the Partnership Agreement regardless of how or whether they vote
on the proposal.
Jones Intercable, Inc., as general partner of the Partnership, urges you to
sign and return the enclosed proxy as promptly as possible. The proxy should be
returned in the enclosed envelope.
JONES INTERCABLE, INC.
General Partner
LOGO
Elizabeth M. Steele
Secretary
Dated: January 22, 1996
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REVISED PRELIMINARY COPY
LOGO
9697 EAST MINERAL AVENUE
ENGLEWOOD, COLORADO 80112
PROXY STATEMENT
VOTE OF THE LIMITED PARTNERS OF CABLE TV FUND 11-B, LTD.
This Proxy Statement is being furnished in connection with the solicitation
of the written consents of the limited partners of Cable TV Fund 11-B, Ltd.
(the "Partnership") by Jones Intercable, Inc., the general partner of the
Partnership (the "General Partner"), on behalf of the Partnership, for the
purpose of obtaining limited partner approval of the sale of the Partnership's
cable television system serving the communities of Barker, Clarence, Elma,
Lancaster, Lockport, Newfane, Orchard Park and Somerset, all in the State of
New York (the "New York System") for $84,000,000 in cash, subject to normal
working capital closing adjustments that may have the effect of increasing or
reducing the purchase price by a non-material amount, to Global Acquisition
Partners, L.P., a Delaware limited partnership (the "Purchaser") that is
affiliated with Adelphia Communications Corporation ("Adelphia"). Neither the
Purchaser nor Adelphia are affiliated with the Partnership or with the General
Partner.
Proxies in the form enclosed, properly executed and duly returned, will be
voted in accordance with the instructions thereon. Limited partners are urged
to sign and return the enclosed proxy as promptly as possible. Proxies cannot
be revoked except by delivery of a proxy dated as of a later date. Officers and
other employees of the General Partner may solicit proxies by mail, by fax, by
telephone or by personal interview. The deadline for the receipt of proxy votes
is February 29, 1996, unless extended, but the vote of the Partnership's
limited partners will be deemed to be concluded on the date that the General
Partner, on behalf of the Partnership, is in receipt of proxies executed by the
holders of a majority of the limited partnership interests either consenting to
or disapproving of the proposed transaction. The cost of the proxy solicitation
will be paid by the Partnership.
The Partnership has only one class of limited partners and no limited partner
has a right of priority over any other limited partner. The participation of
the limited partners is divided into limited partnership interests and each
limited partner owns one limited partnership interest for each $500 of capital
contributed to the Partnership.
As of November 15, 1995, the Partnership had 38,026 limited partnership
interests outstanding, held by approximately 3,161 persons. There is no
established trading market for such interests. To the best of the General
Partner's knowledge, no person or group of persons beneficially own more than
five percent of the limited partnership interests. The General Partner owns 40
limited partnership interests, which constitute less than one percent of the
limited partnership interests. Officers and directors of the General Partner do
not own any limited partnership interests. The 40 limited partnership interests
owned by the General Partner will be voted in favor of the proposed
transaction. Only limited partners of record at the close of business on
December 31, 1995 will be entitled to notice of, and to participate in, the
vote.
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Upon the consummation of the proposed sale of the New York System, the
Partnership will pay all of its indebtedness, which totalled approximately
$23,751,285 at September 30, 1995, its sales tax liability of approximately
$1,750,000 and a brokerage fee of $2,100,000 to The Jones Group, Ltd., a
subsidiary of the General Partner, and then the Partnership will distribute the
net sale proceeds to its partners of record as of February 29, 1996. Because
limited partners have already received distributions in an amount equal to 100
percent of the capital initially contributed to the Partnership by the limited
partners, the net proceeds from the New York System's sale will be distributed
75 percent to the limited partners and 25 percent to the General Partner. Based
upon the pro forma financial information as of September 30, 1995, as a result
of the New York System's sale, the limited partners of the Partnership, as a
group, will receive approximately $41,849,809 and the General Partner will
receive approximately $13,949,937. Limited partners will receive $1,101 for
each $500 limited partnership interest, or $2,201 for each $1,000 invested in
the Partnership, from the net proceeds of the New York System's sale. Once the
distribution of the net proceeds from the sale of the New York System has been
made, limited partners will have received a total of $1,601 for each $500
limited partnership interest, or $3,201 for each $1,000 invested in the
Partnership, taking into account the distributions to limited partners made in
July 1990 and July 1992.
Limited partners should note that there are certain income tax consequences
of the proposed sale of the New York System, which are outlined herein under
the caption "Federal Income Tax Consequences."
The Partnership also has an 8 percent ownership interest in Cable TV Joint
Fund 11, a Colorado general partnership. Cable TV Joint Fund 11 currently owns
one cable television system serving the City of Manitowoc, Wisconsin (the
"Manitowoc System"). In September 1995, Cable TV Joint Fund 11 entered into a
purchase and sale agreement pursuant to which it agreed to sell the Manitowoc
System to the General Partner for a sales price of $15,735,667, subject to
working capital adjustments. The General Partner has subsequently assigned its
rights and obligations to purchase the Manitowoc System to one of its wholly
owned subsidiaries, Jones Cable Holdings, Inc. Closing of the sale of the
Manitowoc System is contingent upon the satisfaction of certain closing
conditions, including the approval by the City of Manitowoc to the transfer of
the Manitowoc System's franchise and the approval of the holders of a majority
of the limited partnership interests in each of the Partnership, Cable TV Fund
11-A, Ltd., Cable TV Fund 11-C, Ltd. and Cable TV Fund 11-D, Ltd. Information
about the sale of the Manitowoc System will be provided to the limited partners
of the Partnership in a separate proxy statement in connection with a special
vote of the limited partners of the Partnership to approve the sale of the
Manitowoc System.
The proposal that is the subject of this proxy solicitation will be adopted
only if approved by the holders of a majority of the limited partnership
interests. Each limited partnership interest entitles the holder thereof to one
vote on the proposal. Because the Partnership's limited partnership agreement
(the "Partnership Agreement") requires that the proposal to sell the New York
System be approved by the holders of a majority of the limited partnership
interests, abstentions and non-votes will be treated as votes against the
proposal. A properly executed consent returned to the General Partner on which
a limited partner does not mark a vote will be counted as a vote for the
proposed sale of the New York System. Because limited partners do not have
dissenters' or appraisal rights in connection with the proposed sale of the New
York System, if the holders of a majority of the limited partnership interests
approve the proposal, all limited partners will receive a distribution of the
net sale proceeds in accordance with the procedures prescribed by the
Partnership Agreement regardless of how or whether they vote on the proposal.
The Board of Directors of the General Partner has approved the proposed sale
of the New York System and the General Partner recommends approval of the
transaction by the holders of the Partnership's limited partnership interests.
The approximate date on which this Proxy Statement and Form of Proxy are
being sent to limited partners is January 22, 1996.
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PARTNERSHIP INFORMATION
THE PARTNERSHIP'S INVESTMENT OBJECTIVES
The Partnership was formed to acquire, develop, operate and, ultimately, sell
cable television systems. The primary objectives of the Partnership have been
to obtain capital appreciation in the value of the Partnership's cable
television properties; to generate tax losses that could be used to offset
taxable income of limited partners from other sources; and to obtain equity
build-up through debt reduction. It has been contemplated from the outset of
the Partnership's existence that capital appreciation in Partnership cable
television properties would be converted to cash by a sale of such properties
at such time as the General Partner determined that the Partnership's
investment objectives had substantially been achieved.
The Partnership was formed in May 1983 as a Colorado limited partnership in
connection with a public offering of its limited partnership interests. Since
its formation, the Partnership has engaged primarily in the ownership and
operation of the New York System and the neighboring cable television system
serving the municipality of Grand Island, New York (the "Grand Island System"),
which was sold in July 1992, and, through its investment of $3,500,000 of
limited partner capital contributions in Cable TV Joint Fund 11, the
Partnership has had an 8 percent ownership interest in cable television systems
owned and operated by Cable TV Joint Fund 11 serving various communities in the
State of Wisconsin, substantially all of which were sold in two transactions
occurring in September 1989 and June 1990.
Cable TV Joint Fund 11 is a Colorado general partnership formed by four
public limited partnerships sponsored by the General Partner, including the
Partnership, Cable TV Fund 11-A, Ltd., which has an 18 percent ownership
interest, Cable TV Fund 11-C, Ltd., which has a 27 percent ownership interest,
and Cable TV Fund 11-D, Ltd., which has a 47 percent ownership interest, for
the purpose of acquiring, developing, operating and, ultimately, selling cable
television systems. In April 1984, Cable TV Joint Fund 11 acquired the cable
television systems serving the communities of Cedarburg, Green Bay, Hustisford,
Janesville, Kenosha, Manitowoc, West Allis, Waupaca and their surrounding
areas, all in the State of Wisconsin. Except for the Manitowoc System, which is
still owned by Cable TV Joint Fund 11, all of these systems have been sold.
In September 1989, Total TV of Kenosha, a Wisconsin limited partnership in
which Cable TV Joint Fund 11 had a 75 percent ownership interest as both the
general partner and a limited partner, sold its cable television systems
serving the Kenosha, Wisconsin area to an affiliate of the General Partner.
Proceeds to Cable TV Joint Fund 11 from this sale, which totaled approximately
$31,828,700, were used to repay $30,600,000 of Cable TV Joint Fund 11's
outstanding obligations under its credit facility. Certain minority investors
in Total TV of Kenosha, which were not affiliated with Cable TV Joint Fund 11,
the Partnership or the General Partner, received approximately $5,171,100 from
the sale. No distributions to the four partnerships participating in Cable TV
Joint Fund 11 were made from the proceeds of the sale of the Kenosha, Wisconsin
system.
In June 1990, Cable TV Joint Fund 11 sold its remaining Wisconsin cable
television systems, except for the Manitowoc System. These Wisconsin systems
were sold to an affiliate of the General Partner. Proceeds from that sale were
used to repay all of Cable TV Joint Fund 11's indebtedness in connection with
its Wisconsin systems and to make distributions to the four partnerships
participating in Cable TV Joint Fund 11. The Partnership subsequently
distributed its share of the sale proceeds to its limited partners. Limited
partners of the Partnership received a distribution of $240.50 per $500 limited
partnership interest, or $481 per $1,000 invested in the Partnership, as a
result of the sale of Cable TV Joint Fund 11's Wisconsin systems.
The Partnership previously attempted to sell the New York System in 1989. In
August 1989, the Partnership entered into an agreement to sell both the New
York System and the Grand Island System, which were acquired together in March
1984 and then operated as one system, to Adelphia. The August 1989 contract
provided for the sale of the New York System and the Grand Island System for a
price of $80,500,000. That transaction was approved by the holders of a
majority of the Partnership's limited
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partnership interests pursuant to a vote of limited partners conducted in
December 1989 and January 1990. That transaction did not close because Adelphia
was not able to obtain the financing it needed to close the transaction, and in
August 1991, the General Partner, on behalf of the Partnership, filed a lawsuit
against Adelphia for breach of contract. In March 1992, the General Partner, on
behalf of the Partnership, and Adelphia entered into a settlement agreement and
the litigation was dismissed on the condition that Adelphia acquire the Grand
Island System for a purchase price of $14,500,000 pursuant to the terms of a
new purchase and sale agreement. When the Partnership sold the Grand Island
System to Adelphia in July 1992, the lawsuit was dismissed. Proceeds from the
sale of the Grand Island System were used to reduce Partnership debt and a
distribution of the net sale proceeds was made to the limited partners of the
Partnership in July 1992. Limited partners received $259.50 per $500 limited
partnership interest, or $519 per $1,000 invested in the Partnership. The July
1992 distribution to the limited partners of the net proceeds from the sale of
the Grand Island System, together with the July 1990 distribution made to the
limited partners of the net proceeds to the Partnership from the sale of Cable
TV Joint Fund 11's Wisconsin systems, represented the return to the limited
partners of an amount equal to 100 percent of the capital initially contributed
to the Partnership by the limited partners.
Cable TV Joint Fund 11 continues to own and operate the Manitowoc System and,
as disclosed above, there is an agreement in place with respect to the sale of
the Manitowoc System. The Partnership will be terminated and dissolved shortly
after the New York System and the Manitowoc System are sold. The sale of the
Manitowoc System is subject to certain closing conditions that have not yet
been satisfied, including the approval of the holders of a majority of the
limited partnership interests in each of the four constituent partnerships of
Cable TV Joint Fund 11, including the Partnership. Negotiations relating to the
renewal and transfer of the Manitowoc System's franchise are continuing and the
system currently is being operated pursuant to a temporary extension of the
franchise's term until February 13, 1996. The General Partner anticipates that
the City of Manitowoc ultimately will agree to the renewal and transfer of the
franchise so as not to frustrate the sale of the Manitowoc System. The General
Partner currently anticipates that the proxy statements soliciting the consents
of the limited partners of the four constituent partnerships of Cable TV Joint
Fund 11 will not be delivered to limited partners until after the City of
Manitowoc agrees to the renewal and transfer of the franchise. Due to these
various closing contingencies, there can be no assurance that the Manitowoc
System will be able to be sold under the terms of the current contract. If the
Manitowoc System's franchise is not renewed, the General Partner, on behalf of
Cable TV Joint Fund 11, will avail itself of all remedies and recourse granted
to cable operators under federal and applicable state and local laws in order
to preserve the Manitowoc System's right to provide cable services in the City
of Manitowoc. The Partnership will continue to exist as a public entity subject
to the informational reporting requirements of the Securities Exchange Act of
1934 (the "Exchange Act") only until such time as the New York System and the
Manitowoc System are sold and Cable TV Joint Fund 11 and the Partnership are
dissolved.
The purpose of the sale of the New York System, from the Partnership's
perspective, is to attain the Partnership's primary investment objective, i.e.,
to convert the Partnership's capital appreciation in the New York System to
cash. The sale proceeds will be used to repay all outstanding indebtedness of
the Partnership, with the remaining sale proceeds to be distributed to the
partners of the Partnership in accordance with the distribution procedures
established by the Partnership Agreement. The sale of the New York System is
thus the necessary final step in the Partnership's accomplishment of its
investment objectives with respect to the New York System.
VOTING PROVISION OF THE PARTNERSHIP AGREEMENT
Section 2.2(k) of the Partnership Agreement provides that the sale of all or
substantially all of the Partnership's assets is subject to the approval of the
holders of a majority of the Partnership's limited partnership interests.
Because the New York System represents substantially all of the Partnership's
remaining assets, the proposed sale of the New York System to the Purchaser is
being submitted for limited partner approval.
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PROPOSED SALE OF ASSETS
GENERAL
Pursuant to the terms and conditions of a purchase and sale agreement dated
October 6, 1995 (the "Purchase and Sale Agreement") by and between the
Partnership and the Purchaser, the Partnership has agreed to sell the New York
System to the Purchaser for a sales price of $84,000,000. The Purchaser, Global
Acquisition Partners, L.P., is a Delaware limited partnership headquartered at
5 West Third Street, Coudersport, Pennsylvania 16915. The Purchaser is
affiliated with Adelphia Communications Corporation, a Delaware corporation
also headquartered at 5 West Third Street, Coudersport, Pennsylvania 16915.
Adelphia is engaged in the ownership and operation of cable television systems
located in New York and other states. The Purchaser's general partner is
Highland Acquisition Partners, a Pennsylvania general partnership that also is
affiliated with Adelphia. The Purchaser, its general partner and Adelphia are
not affiliated with either the Partnership or the General Partner.
The Partnership has been informed that the Purchaser intends to finance its
acquisition of the New York System through cash on hand and through borrowings
from commercial lending institutions. Concurrently with the execution of the
Purchase and Sale Agreement, the Purchaser delivered to the Partnership an
irrevocable letter of credit issued by The Bank of Nova Scotia in the amount of
$84,000,000. In the event that the transactions contemplated by the Purchase
and Sale Agreement are not consummated on the closing date due to the
Purchaser's failure or refusal to close, and all conditions to the Purchaser's
obligation to close have been satisfied, the Partnership will be entitled, at
its sole option and discretion, either to (i) draw down the amount of the
purchase price, as adjusted pursuant to the terms of the Purchase and Sale
Agreement for working capital adjustments, under the letter of credit, or (ii)
terminate the Purchase and Sale Agreement and pursue any and all of the
Partnership's equitable and legal causes of action against the Purchaser. The
Purchaser will be liable to the bank if any amounts are drawn down from the
letter of credit.
THE CLOSING
The closing of the sale will occur on a date approximately ten days after all
of the closing conditions set forth in the Purchase and Sale Agreement have
been satisfied or waived. It is anticipated that the closing will occur during
the first half of 1996. Because the closing is conditioned upon, among other
things, the approval of the limited partners and the receipt of material third
party consents necessary for the transfer of the New York System to the
Purchaser, there can be no assurance that the proposed sale will occur. If all
conditions precedent to the Purchaser's obligation to close are not satisfied
or waived by September 30, 1996, the Purchaser's obligations will terminate.
THE NEW YORK SYSTEM
The assets to be acquired by the Purchaser consist primarily of the tangible
and intangible assets of the New York System. The New York System, together
with the Grand Island System, was purchased by the Partnership from
unaffiliated parties in March 1984 for an aggregate purchase price of
$22,000,000. The Partnership also paid a brokerage fee of $1,045,000 to an
affiliate of the General Partner. The New York System was purchased using the
limited partner capital contributions to the Partnership, and amounts available
under the Partnership's credit facility with a commercial bank.
At the date of acquisition in March 1984, the New York System, together with
the Grand Island System, served approximately 20,200 basic subscribers using
approximately 495 miles of cable plant passing approximately 35,900 dwelling
units. At the time of its sale to Adelphia in July 1992, the Grand Island
System served approximately 5,500 basic subscribers. As of December 31, 1994,
the New York System served approximately 37,620 basic subscribers, using
approximately 842 miles of cable plant passing approximately 57,000 dwelling
units.
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The Purchaser will purchase all of the tangible assets of the New York
System that are leased or owned by the Partnership and used in the operation
of the system, including the headend equipment, underground and aboveground
cable distribution systems, towers, earth satellite receive stations and
furniture and fixtures of the system. The Purchaser also will acquire certain
of the intangible assets of the system, including all of the franchises,
leases, agreements, permits, licenses and other contracts and contract rights
necessary for the operation of the system. Also included in the sale are the
subscriber accounts receivable of the system and all of the system's records,
files, schematics, maps, reports, promotional graphics, marketing materials
and reports filed with federal, state and local regulatory agencies. The
foregoing notwithstanding, certain of the system's assets will be retained by
the Partnership, including cash or cash equivalents on hand and in banks,
insurance policies, intercompany receivables, letters of credit and surety
bonds, and any federal, state or local income or other tax refunds to which
the Partnership may be entitled. The Partnership has contracted to sell a
small parcel of real estate that the Partnership owns for a sales price of
$75,000 in cash. The purchaser is not affiliated with the Partnership, the
General Partner or Adelphia. The closing of the sale of this parcel of real
estate will occur shortly before or soon after the closing of the sale of the
New York System.
PURCHASE PRICE
Subject to the adjustments described below, the purchase price for the New
York System is $84,000,000. The purchase price will be decreased by an amount
equal to a working capital adjustment to the extent the working capital
adjustment is a negative amount as of the closing date and the purchase price
will be increased by an amount equal to the working capital adjustment to the
extent the working capital adjustment is a positive amount as of the closing
date. Under the terms of the Purchase and Sale Agreement, the working capital
adjustment is defined as the number obtained by subtracting the sum of the
Partnership's current liabilities (as defined and determined in accordance
with generally accepted accounting principles) on the closing date which
constitute liabilities to be assumed by the Purchaser from the sum of the
Partnership's current assets (as defined and determined in accordance with
generally accepted accounting principles, except that inventory will not be
included as a current asset) on the closing date which are included within the
assets to be acquired by the Purchaser. The working capital adjustment as of
September 30, 1995, exclusive of employee-related items to be assumed by the
Purchaser, was a negative amount of $249,605. And, as such, if the closing had
occurred on September 30, 1995, the $84,000,000 purchase price would be
reduced by this amount. Please see Note 3 of the Notes to Unaudited Pro Forma
Financial Statements for a detailed accounting of the estimated closing
adjustments.
CONDITIONS TO CLOSING
The Purchaser's obligations under the Purchase and Sale Agreement are
subject to the following conditions: (a) all of the representations and
warranties of the Partnership contained in the Purchase and Sale Agreement
shall be true and correct in all material respects as of the closing date; (b)
there shall not have occurred any material adverse change in the business or
financial condition of the New York System or its operations other than any
change arising out of events or conditions that affect the cable television
industry generally between the contract date and the closing date; (c) the
Partnership shall have delivered to the Purchaser certificates and legal
opinions required by the Purchase and Sale Agreement; (d) the Partnership and
the General Partner shall have delivered to the Purchaser a non-competition
agreement; (e) the Partnership shall have obtained certain consents and
approvals from governmental authorities and other third parties; (f) the
General Partner shall have delivered to the Purchaser evidence that the
holders of a majority of the limited partnership interests of the Partnership
have approved the transaction; and (g) the statutory waiting period applicable
to the Purchase and Sale Agreement and the transactions contemplated thereby
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
shall have terminated or shall have expired. In order to sell the New York
System, the Partnership must obtain the consent of the state and local
franchising authorities to the transfer to the Purchaser of the system's cable
television franchises, the approval of the Federal Communications Commission
to the transfer of certain licenses and the consent of third parties with whom
the Partnership has real property leases to the transfer thereof. If the
Partnership fails to obtain certain consents and approvals of third parties
with whom the system has contracted, the Purchaser may, in its sole
discretion, waive this condition to closing.
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The Partnership's obligations under the Purchase and Sale Agreement are
subject to the following conditions: (a) approval of the transaction by the
holders of a majority of the Partnership's limited partnership interests, (b)
all of the representations and warranties of the Purchaser contained in the
Purchase and Sale Agreement shall be true and correct in all material respects
as of the closing date; (c) the Purchaser shall have delivered to the
Partnership certificates and legal opinions required by the Purchase and Sale
Agreement; (d) receipt of the purchase price for the New York System; and (e)
the expiration or termination of all waiting periods under the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as amended.
All waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, have expired, thereby removing this as a condition to
closing. The New York state cable authority has conditionally approved the sale
of the New York System by the Partnership to the Purchaser. Approvals of
certain of the local franchising authorities to the transfer of certain of the
New York System's franchises have been obtained. The remaining local
governmental approvals are pending, and the General Partner expects that all
such approvals will be obtained in the near future. The approvals of the
Federal Communications Commission to the transfer of certain of the New York
System's licenses also are pending and are expected to be received in the near
future.
BROKERAGE FEE
As permitted by Section 2.2(n)(i) of the Partnership Agreement, which
provides for the payment of a brokerage fee to The Jones Group, Ltd. in an
amount not to exceed 2.5 percent of the sales price of a cable television
system sold by the Partnership to an unaffiliated party, the Partnership will
pay The Jones Group, Ltd., a subsidiary of the General Partner, a $2,100,000
fee upon the completion of the sale of the New York System to the Purchaser as
compensation to The Jones Group, Ltd. for acting as the Partnership's broker
and financial advisor in connection with the sale of the New York System to the
Purchaser. This fee represents 2.5 percent of the $84,000,000 sales price.
REASONS FOR THE SALE
The decision to proceed with the sale of the New York System at this time was
based upon the General Partner's determination that the Partnership has
achieved its investment objectives with respect to the New York System. The New
York System has appreciated in value through the General Partner's operational
expertise, general economic factors and certain other developments such as the
favorable regulatory environment during the first half of the holding period
and improvements in satellite technology generally benefiting the cable
television industry.
The Partnership has a finite legal existence of 17 years, more than 12 of
which have passed. It was not intended that the Partnership would hold its
cable television systems for the full 17-year period. Although it was not
possible at the outset of the Partnership to determine precisely how quickly
the investment objectives with respect to any particular system would be
achieved, investors were informed that the General Partner's past experience
had shown that five to seven years was the average length of time from the
acquisition of a cable system to its sale. An investor in the Partnership also
was able, of course, to examine the track record of the General Partner's prior
public partnerships, which, at the time of the Partnership's formation, showed
that prior partnerships had rarely held their cable systems for any longer than
six years.
When investing in the Partnership, by virtue of the provisions of the
Partnership Agreement, the limited partners vested in the General Partner the
right and responsibility to determine when the Partnership's investment
objectives had been achieved. The New York System was acquired because, in the
opinion of the General Partner at the time of the New York System's
acquisition, it had the potential for capital appreciation within a reasonable
period of time. It is the General Partner's opinion that during the
approximately 11 years that the New York System has been held by the
Partnership, the Partnership's investment objectives with respect to the New
York System have been achieved.
7
<PAGE>
The General Partner generally considered the benefits to the limited partners
that might be derived by holding the New York System for an additional period
of time. The General Partner assumed that the New York System probably would
continue to appreciate in value and that as a result the New York System might
be able to be sold for a greater sales price in the future. The General Partner
weighed these assumptions against the potential risks to investors from a
longer holding period, i.e., the risk that regulatory, technology and/or
competitive developments could cause the New York System to decline in value,
which could result in a lesser sales price in the future. The General Partner
is not certain whether or in what form pending legislation in Congress will be
adopted or if such legislation if enacted into law would have a positive or
negative effect on the cable television industry as a whole and on the New York
System in particular. Weighing all of these factors, the General Partner
concluded that now rather than later was the time to sell the New York System.
Because of its potential interest in acquiring the New York System, the
General Partner, following the public bidding provisions of the Partnership
Agreement, solicited indications of interest in the system from third parties
through advertisements placed by The Jones Group, Ltd. All bids for the system
were required to be received by March 24, 1995. Fifteen companies and/or
individuals made preliminary inquiries about the New York System; however, only
the General Partner submitted a qualifying bid. Also on March 24, 1995,
however, Adelphia submitted an offer to purchase the New York System for
$88,000,000, which was more than the General Partner was willing to pay.
Adelphia's offer was specifically subject to terms and conditions set forth in
a draft purchase and sale agreement attached to the offer. Although the General
Partner recognized that certain of the terms and conditions of Adelphia's offer
would be unacceptable to the Partnership, primarily because the offer was
conditioned upon representations and warranties about the New York System that
the Partnership was not able to give and, in addition, the offer provided no
assurance about Adelphia's ability to finance the acquisition, the General
Partner determined that it would be in the best interests of the Partnership to
pursue negotiations with Adelphia. During the weeks following receipt of
Adelphia's offer, the President and a Vice President of The Jones Group, Ltd.
discussed the proposed agreement with Adelphia's Director of Finance and its
legal counsel. On April 14, 1995, the President of The Jones Group, Ltd.
accepted Adelphia's offer on behalf of the Partnership subject to certain
changes to Adelphia's proposed agreement. In addition, The Jones Group, Ltd.,
on behalf of the Partnership, required that Adelphia provide a letter of credit
naming the Partnership as beneficiary to ensure Adelphia's ability to finance
the acquisition of the New York System. Other changes proposed to Adelphia
related to Adelphia's request for representations about the number of
subscribers and the amount of revenue to be generated by the New York System at
closing, which, as proposed by Adelphia, could not be met. On April 24, 1995,
the President and a Vice President of The Jones Group, Ltd. met with Adelphia's
Senior Vice President and its Director of Finance in the offices of The Jones
Group, Ltd. in Englewood, Colorado to discuss the proposed changes. In return
for Adelphia's agreements that the Partnership would make no representation
about the number of subscribers in the New York System and would represent a
lower level of revenues than first proposed, the purchase price was revised to
$85,000,000. During the period May 1995 through late August 1995, drafts of a
purchase and sale agreement were exchanged between The Jones Group, Ltd. and
legal counsel for the Partnership, on the one hand, and Adelphia and its legal
counsel, on the other hand. During the same period, Adelphia sought an
irrevocable letter of credit in the amount of the proposed purchase price from
its bank. On August 21, 1995, after receiving a commitment for a letter of
credit, Adelphia's Director of Finance informed The Jones Group, Ltd. that
Adelphia wished to renegotiate the terms of its purchase of the New York System
and specifically requested that the Partnership pay a portion of the letter of
credit's maintenance costs. Adelphia made various proposals and on August 30,
1995, it was agreed among the parties that the purchase price for the New York
System would be revised to $84,000,000 and there would be no revenue
representation by the Partnership. Adelphia agreed to pay all costs related to
the letter of credit except that the Partnership agreed to pay on-going
maintenance costs for the letter of credit for two months (i.e., months seven
and eight after the contract date) in the event that the sale of the New York
System did not close within six months after the date of contract. The
definitive agreement was signed by the Purchaser and the Partnership on October
6, 1995. The sales price of $84,000,000 for the New York System thus was
achieved in an arm's-length negotiation between The Jones Group, Ltd.,
representing the Partnership, and Adelphia, representing the Purchaser. The
General Partner therefore believes that the proposed sales price of $84,000,000
is a fair price and recommends that the limited partners vote to approve the
transaction.
8
<PAGE>
CERTAIN EFFECTS OF THE SALE
Upon consummation of the sale of the New York System, the proceeds of the
sale will be used to repay all indebtedness of the Partnership and then the
Partnership will distribute the remaining net sale proceeds to the limited
partners and to the General Partner pursuant to the terms of the Partnership
Agreement. Because limited partners have already received distributions in an
amount equal to 100 percent of the capital initially contributed to the
Partnership by the limited partners, the net proceeds from the New York
System's sale will be distributed 75 percent to the limited partners and 25
percent to the General Partner pursuant to the terms of the Partnership
Agreement. Based upon the pro forma financial information as of September 30,
1995, as a result of this distribution, the limited partners of the
Partnership, as a group, will receive approximately $41,849,809 and the General
Partner will receive approximately $13,949,937. Both the limited partners and
the General Partner will be subject to federal income tax on the income
resulting from the sale of the New York System. See the detailed information
below under the caption "Federal Income Tax Consequences."
After the sale of the New York System, the Partnership will continue to own
an 8 percent interest in Cable TV Joint Fund 11 until such time as the
Manitowoc System is sold. After the closing of the sale of the Manitowoc System
and the distribution of the Partnership's portion of the net sale proceeds
therefrom, the Partnership will be liquidated and dissolved.
Neither Colorado law nor the Partnership Agreement afford dissenters' or
appraisal rights to limited partners in connection with the proposed sale of
the New York System. If the proposed transaction is approved by the holders of
a majority of limited partnership interests, all limited partners will receive
a distribution in accordance with the procedures prescribed by the Partnership
Agreement regardless of how or whether they vote on the proposal.
It is anticipated that if the proposed transaction is not consummated, the
General Partner's current management team will continue to manage the New York
System on behalf of the Partnership until such time as the New York System can
be sold.
FEDERAL INCOME TAX CONSEQUENCES
The purpose of the following discussion of the income tax consequences of the
proposed transaction is to inform the limited partners of the Partnership of
the federal income tax consequences to the Partnership and to its partners
arising from the sale of the New York System. The tax information included
herein was prepared by the tax department of the General Partner and was
reviewed by the Group Vice President/Taxation/Administration of the General
Partner. The tax information is taken from tax data compiled by the General
Partner in its role as the Partnership's tax administrator and is not based
upon the advice or formal opinion of counsel. The tax discussion that follows
is merely intended to inform the limited partners of factual information and
should not be considered tax advice.
By the expected date of the New York System's sale, the limited partners will
have received certain tax benefits from their investment in the Partnership.
Assuming maximum federal income tax rates and no other sources of passive
income, limited partners will have received $8,948,849 in tax benefits from
Partnership losses ($471 per $1,000 invested).
Application of the "at risk" rules and the passive activity loss limitation
has limited deductible losses in prior years and created at risk and passive
loss carryovers to the year of sale. The gain on sale incorporates all prior
losses disallowed under the loss limitations that are presumed deductible in
the year of sale.
9
<PAGE>
The sale of the New York System will result in a gain for federal income tax
purposes. The amount of this gain allocated to limited partners is
approximately $42,096,821. The General Partner estimates that $31,769,213
($1,671 per $1,000 invested) of this total gain will be treated as ordinary
income. This amount of ordinary income results from the recapture of
depreciation on personal property under Section 1245. The General Partner
estimates that the remainder of the gain, or approximately $10,327,607 ($543
per $1,000 invested), will be Section 1231 gain that will generally be treated
as long term capital gain by the limited partners.
Assuming the 31 percent rate applies to ordinary income and a 28 percent rate
applies to long-term capital gain, as a result of the sale of the New York
System, a limited partner will be subject to federal income taxes of $670 per
$1,000 invested in the Partnership. The taxable income will be recognized in
the year of the closing of the sale, which is expected to be 1996.
Limited partners who are non-resident aliens or foreign corporations
("foreign persons") are subject to a withholding tax on their share of the
Partnership's income from the sale of the New York System. The withholding
rates are 39.6 percent for individual partners and 35 percent for corporate
partners. The tax withheld will be remitted to the Internal Revenue Service and
the foreign person will receive a credit on their U.S. tax return for the
amount of the tax withheld by the Partnership. The tax withheld will be treated
as a distribution to the limited partner.
CERTAIN INFORMATION ABOUT THE PARTNERSHIP, THE GENERAL
PARTNER AND THE PURCHASER OF THE SYSTEM
The principal executive offices of the Partnership and the General Partner
are located at 9697 East Mineral Avenue, Englewood, Colorado 80112, and their
telephone number is (303) 792-3111. The principal executive offices of the
Purchaser are located at 5 West Third Street, Coudersport, Pennsylvania 16915.
The limited partnership interests of the Partnership are registered pursuant
to Section 12(g) of the Exchange Act. As such, the Partnership currently is
subject to the informational reporting requirements of the Exchange Act and, in
accordance therewith, is obligated to file periodic reports, proxy statements
and other information with the Securities and Exchange Commission relating to
its business, financial condition and other matters. Reports and other
information filed by the Partnership can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549, and at the following regional offices of the
Commission: 7 World Trade Center, Suite 1300, New York, New York 10048 and
Northwest Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. The Partnership is an Edgar filer. It is anticipated that the
Partnership will continue in existence and will continue to be subject to the
informational reporting requirements of the Exchange Act only for a short time
after the sale of the New York System. It is expected that Cable TV Joint Fund
11 will sell its Manitowoc System shortly before or shortly after the
Partnership's sale of the New York System. After the net proceeds of both sales
are distributed to the Partnership's partners, Cable TV Joint Fund 11 and the
Partnership will be liquidated and dissolved. The Partnership's registration
and reporting requirements under the Exchange Act will be terminated upon the
dissolution of the Partnership.
USE OF PROCEEDS FROM THE NEW YORK SYSTEM'S SALE
The following is a brief summary of the Partnership's estimated use of the
proceeds from the sale of the New York System. All of the following selected
financial information is based upon amounts as of September 30, 1995 and
certain estimates of liabilities at closing. Final results may differ from
these estimates. A more detailed discussion of the financial consequences of
the sale of the system is set forth below under the caption "Unaudited Pro
Forma Financial Information." All limited partners are encouraged to review
carefully the unaudited pro forma financial statements and notes thereto.
10
<PAGE>
If the holders of a majority of limited partnership interests of the
Partnership approve the proposed sale of the New York System and the
transaction is closed, the Partnership will pay all of its indebtedness and
then the Partnership will distribute the net sale proceeds pursuant to the
terms of the Partnership Agreement. The estimated uses of the sale proceeds are
as follows:
<TABLE>
<S> <C>
Contract Sales Price of the New York System.................... $ 84,000,000
Add:Cash on Hand............................................... 175,898
Estimated Net Closing Adjustments.............................. (249,605)
Less:Repayment of Debt and Accrued Interest.................... (24,276,547)
Brokerage Fee and Sales Tax Liability.......................... (3,850,000)
------------
Cash Available for Distribution by the Partnership........ $ 55,799,746
============
Limited Partners' Share (75%)............................. $ 41,849,809
============
General Partners' Share (25%)............................. $ 13,949,937
============
</TABLE>
Based on financial information available at September 30, 1995, below is an
estimate of all cash distributions that will have been made to limited partners
after the distribution of the proceeds from the sale of the New York System is
completed.
<TABLE>
<S> <C>
Summary of
Estimated Cash
Distributions
to Limited
Partners:
Prior
Distributions
made in July
1990 and
July 1992... $1,000
Limited
Partners'
Share of
Proceeds on
Sale of the
New York
System...... 2,201
------
Total Cash
Received per
$1,000 of
Limited
Partnership
Capital..... $3,201
======
Total Cash
Received per
$500 Limited
Partnership
Interest ... $1,601
======
</TABLE>
Taking into account the distributions to be made on the sale of the New York
System and the distributions made in July 1992 upon the sale of the Grand
Island System and the distributions made in July 1990 upon the sale of the
Wisconsin systems formerly owned by Cable TV Joint Fund 11, the estimated
after-tax internal rate of return on an investment in the Partnership is
approximately 12.5 percent. This internal rate of return does not reflect the
distributions to be made upon the sale of the Manitowoc System.
Based on financial information available at June 30, 1995, the following
table presents the estimated results of the Partnership when it has completed
the sale of the New York System:
<TABLE>
<S> <C>
Dollar Amount Raised....................................... $19,013,000
Number of Cable Television Systems Purchased Directly...... Two
Number of Cable Television Systems Purchased Indirectly.... Eight
Date of Closing of Offering................................ August 1983
Date of First Sale of Properties........................... September 1989
Tax and Distribution Data per $1,000 of Limited Partnership
Capital:
Federal Income Tax Results
Ordinary Income (Loss)
--from operations...................................... $ (948)
--from recapture....................................... $2,009
Capital Gain (Loss).................................... $1,161
Cash Distributions to Investors
Source (on GAAP basis)
--investment income.................................... $2,201
--return of capital.................................... $1,000
Source (on cash basis)
--sales................................................ $3,201
</TABLE>
11
<PAGE>
UNAUDITED PRO FORMA FINANCIAL INFORMATION
OF CABLE TV FUND 11-B, LTD.
The following unaudited pro forma balance sheet assumes that as of September
30, 1995, the Partnership had sold the New York System for $84,000,000. The
funds available to the Partnership, adjusting for the estimated net closing
adjustments of the New York System, are expected to total approximately
$83,750,395. Such funds will be used to repay all indebtedness of the
Partnership, and the balance will be distributed pursuant to the terms of the
Partnership Agreement, which provides that distributions when made will be made
first to the limited partners in an amount that equals the amount initially
contributed to the Partnership by the limited partners with the balance being
made 75 percent to the limited partners and 25 percent to the General Partner.
Because the limited partners have already received distributions totaling the
amount initially contributed to the Partnership by the limited partners, the
net sale proceeds will be distributed 75 percent to the limited partners and 25
percent to the General Partner.
The unaudited pro forma balance sheet should be read in conjunction with the
appropriate notes to the unaudited pro forma balance sheet.
ALL OF THE FOLLOWING UNAUDITED PRO FORMA FINANCIAL INFORMATION IS BASED UPON
AMOUNTS AS OF SEPTEMBER 30, 1995 AND CERTAIN ESTIMATES OF LIABILITIES AT
CLOSING. FINAL RESULTS MAY DIFFER FROM SUCH INFORMATION.
12
<PAGE>
CABLE TV FUND 11-B, LTD.
UNAUDITED PRO FORMA BALANCE SHEET
SEPTEMBER 30, 1995
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
AS REPORTED ADJUSTMENTS BALANCE
----------- ------------ -----------
<S> <C> <C> <C>
ASSETS
Cash and Cash Equivalents................ $ 175,898 $ 55,623,848 $55,799,746
Trade Receivables, net................... 413,460 (413,460) --
Investment in Cable Television
Properties:
Property, plant and equipment, net..... 26,059,694 (26,059,694) --
Investment in cable television venture. 574,458 -- 574,458
----------- ------------ -----------
Total investment in cable television
properties.......................... 26,634,152 (26,059,694) 574,458
Deposits, Prepaid Expenses and Deferred
Charges................................. 447,149 (447,149) --
----------- ------------ -----------
Total Assets............................. $27,670,659 $ 28,703,545 $56,374,204
=========== ============ ===========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Debt................................... $23,751,285 $(23,751,285) $ --
Accounts payable....................... 118,568 (118,568) --
Accrued liabilities.................... 918,165 (918,165) --
Subscriber prepayments................. 50,732 (50,732) --
Accrued Distribution to Limited
Partners.............................. -- 41,849,809 41,849,809
Accrued Distribution to General
Partner............................... -- 13,949,937 13,949,937
----------- ------------ -----------
Total Liabilities.................... 24,838,750 30,960,996 55,799,746
----------- ------------ -----------
Partners' Capital:
General Partner........................ 53,980 -- 53,980
Limited Partners....................... 2,777,929 (2,257,451) 520,478
----------- ------------ -----------
Total Partners' Capital.............. 2,831,909 (2,257,451) 574,458
----------- ------------ -----------
Total Liabilities and Partners'
Capital............................... $27,670,659 $ 28,703,545 $56,374,204
=========== ============ ===========
</TABLE>
The accompanying notes to unaudited pro forma financial statements are an
integral part of this unaudited balance sheet.
13
<PAGE>
CABLE TV FUND 11-B, LTD.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
AS REPORTED ADJUSTMENTS BALANCE
----------- ------------ ---------
<S> <C> <C> <C>
REVENUES.................................. $12,791,832 $(12,791,832) $ --
COSTS AND EXPENSES:
Operating expense....................... 7,459,002 (7,459,002) --
Management fees and allocated overhead
from
General Partner........................ 1,629,178 (1,629,178) --
Depreciation and Amortization........... 2,359,467 (2,359,467) --
----------- ------------ -------
OPERATING INCOME.......................... 1,344,185 (1,344,185) --
----------- ------------ -------
OTHER INCOME (EXPENSE):
Interest expense........................ (1,146,403) 1,146,403 --
Other, net.............................. (89,862) 89,862 --
----------- ------------ -------
Total other income (expense), net..... (1,236,265) -- --
----------- ------------ -------
INCOME BEFORE EQUITY IN NET LOSS OF CABLE
TELEVISION JOINT VENTURE................. 107,920 (107,920) --
EQUITY IN NET INCOME OF CABLE TELEVISION
JOINT VENTURE............................ 29,033 -- 29,033
----------- ------------ -------
NET INCOME................................ $ 136,953 $ (107,920) $29,033
=========== ============ =======
NET INCOME PER LIMITED PARTNERSHIP
INTEREST................................. $ 3.57 $ (2.81) $ .76
=========== ============ =======
</TABLE>
The accompanying notes to unaudited pro forma financial statements are an
integral part of this unaudited statement.
14
<PAGE>
CABLE TV FUND 11-B, LTD.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
AS REPORTED ADJUSTMENTS BALANCE
----------- ------------ ---------
<S> <C> <C> <C>
REVENUES.................................. $10,592,184 $(10,592,184) $ --
COSTS AND EXPENSES:
Operating expense....................... 5,998,062 (5,998,062) --
Management fees and allocated overhead
from General Partner................... 1,275,876 (1,275,876) --
Depreciation and amortization........... 2,197,401 (2,197,401) --
----------- ------------ -------
OPERATING INCOME.......................... 1,120,845 (1,120,845) --
----------- ------------ -------
OTHER INCOME (EXPENSE):
Interest expense........................ (1,350,904) 1,350,904 --
Other, net.............................. 123,072 (123,072) --
----------- ------------ -------
Total other income (expense), net..... (1,227,832) 1,227,832 --
----------- ------------ -------
LOSS BEFORE EQUITY IN NET LOSS OF CABLE
TELEVISION JOINT VENTURE................. (106,987) (106,987) --
EQUITY IN NET INCOME OF CABLE TELEVISION
JOINT VENTURE............................ 23,975 -- 23,975
----------- ------------ -------
NET INCOME (LOSS)......................... $ (83,012) $ 106,987 $23,975
=========== ============ =======
NET INCOME (LOSS) PER LIMITED PARTNERSHIP
INTEREST................................. $ (2.16) $ 2.78 $ .62
=========== ============ =======
</TABLE>
The accompanying notes to unaudited pro forma financial statements are an
integral part of this unaudited statement
15
<PAGE>
CABLE TV FUND 11-B, LTD.
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
1) The following calculations present the sale of the New York System and the
resulting estimated proceeds expected to be received by the Partnership.
2) The unaudited pro forma balance sheet assumes that the Partnership had
sold the New York System for $84,000,000 as of September 30, 1995. The
unaudited statements of operations assume that the Partnership had sold the New
York System for $84,000,000 as of January 1, 1994.
3) The estimated gain recognized from the sale of the New York System and
corresponding estimated distribution to limited partners as of September 30,
1995 has been computed as follows:
GAIN ON SALE OF ASSETS:
<TABLE>
<S> <C>
Contract sales price............................................. $ 84,000,000
Less: Net book value of investment in cable television properties
at September 30, 1995...................................... 26,059,694
------------
Gain on sale of assets........................................... $ 57,940,306
============
DISTRIBUTIONS TO PARTNERS:
Contract sales price............................................. $ 84,000,000
Working Capital Adjustment:
Add:Trade receivables, net....................................... 413,460
Prepaid expenses................................................. 198,113
Less:Accrued liabilities......................................... (262,435)
Debt assumed by the Purchaser.................................... (548,011)
Subscriber prepayments........................................... (50,732)
------------
Adjusted cash received........................................... 83,750,395
Less:Outstanding debt to third parties........................... (23,751,285)
Interest and other accruals...................................... (525,262)
Sales tax liability.............................................. (1,750,000)
Brokerage fee.................................................... (2,100,000)
Add:Cash on hand................................................. 175,898
------------
Cash available for distribution.................................. $ 55,799,746
============
Amount due Limited Partners (75%)................................ $ 41,849,809
============
Amount due General Partner (25%)................................. $ 13,949,937
============
</TABLE>
AVAILABLE INFORMATION
The Partnership's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994 and the Partnership's Quarterly Report on Form 10-Q for the
fiscal quarter ended September 30, 1995 previously have been mailed to the
limited partners of the Partnership. Additional copies of the Partnership's
Annual Report on Form 10-K for the fiscal year ended December 31, 1994 and the
Partnership's Quarterly Report on Form 10-Q for the fiscal quarter ended
September 30, 1995 are available to each limited partner of the Partnership
without charge upon written request to: Elizabeth M. Steele, Secretary, Jones
Intercable, Inc., 9697 East Mineral Avenue, Englewood, Colorado 80112, (303)
792-3111.
16
<PAGE>
INCORPORATION BY REFERENCE
The Partnership's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994 and the Partnership's Quarterly Report on Form 10-Q for the
fiscal quarter ended September 30, 1995 are incorporated by reference in this
proxy statement. The Partnership specifically incorporates by reference herein
Item 1. Business, Item 2. Properties, Item 5. Market for the Registrant's
Common Stock and Related Security Holder Matters, Item 6. Selected Financial
Data, Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations, Item 8. Financial Statements and Item 13. Certain
Relationships and Related Transactions from the Annual Report on Form 10-K, and
the September 30, 1995 Quarterly Report on Form 10-Q in its entirety.
17
<PAGE>
- -------------------------------------------------------------------------------
[JONES INTERCABLE LOGO]
9697 EAST MINERAL AVENUE
ENGLEWOOD, COLORADO 80112
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE PARTNERSHIP BY THE GENERAL PARTNER
The undersigned Limited Partner of Cable TV Fund 11-B, Ltd., a Colorado
limited partnership, hereby votes on the sale of Cable TV Fund 11-B, Ltd.'s New
York cable television system pursuant to the terms and conditions of that
certain Purchase and Sale Agreement dated October 6, 1995, as follows:
[_] CONSENTS [_] WITHHOLDS CONSENT [_] ABSTAINS
(continued on other side)
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED LIMITED PARTNER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE PROPOSED SALE TRANSACTION.
PLEASE SIGN EXACTLY AS NAME
APPEARS.
When limited partnership inter-
ests are held by more than one
person, all should sign. When
signing as attorney, as executor,
administrator, trustee or guard-
ian, please give full title as
such. If a corporation, please
sign in full corporation name by
authorized officer. If a partner-
ship, please sign in partnership
name by authorized person.
DATED: ________________, 1996
__________________________________
Signature
__________________________________
Signature
__________________________________
Signature
PLEASE SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
- -------------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------------
[JONES INTERCABLE LOGO]
9697 EAST MINERAL AVENUE
ENGLEWOOD, COLORADO 80112
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE PARTNERSHIP BY THE GENERAL PARTNER
The undersigned Limited Partner of Cable TV Fund 11-B, Ltd., a Colorado
limited partnership, hereby votes on the sale of Cable TV Fund 11-B, Ltd.'s New
York cable television system pursuant to the terms and conditions of that
certain Purchase and Sale Agreement dated October 6, 1995, as follows:
[_] CONSENTS [_] WITHHOLDS CONSENT [_] ABSTAINS
(continued on other side)
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THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED LIMITED PARTNER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE PROPOSED SALE TRANSACTION.
PLEASE SIGN EXACTLY AS NAME
APPEARS.
DATED: ________________, 1996
__________________________________
Beneficial Owner Signature
(Investor)
__________________________________
Authorized Trustee/Custodian
Signature
PLEASE SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
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