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FORM 10-K 405
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from ____________ to _____________
Commission file number: 0-14689
JONES CABLE INCOME FUND 1-A, LTD.
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(Exact name of registrant as specified in its charter)
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<S> <C>
Colorado 84-1010416
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(State of Organization) (IRS Employer Identification No.)
P.O. Box 3309, Englewood, Colorado 80155-3309 (303) 792-3111
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(Address of principal executive office and Zip Code) (Registrant's telephone no. including area code)
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Limited
Partnership Interests
Indicate by check mark whether the registrants, (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days:
Yes x No
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Aggregate market value of the voting stock held by non-affiliates of the
registrant: N/A
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (Section 229.405) is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. x
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DOCUMENTS INCORPORATED BY REFERENCE: None
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PART I.
ITEM 1. BUSINESS
THE PARTNERSHIP. Jones Cable Income Fund 1-A, Ltd. (the
"Partnership") is a Colorado limited partnership that was formed pursuant to
the public offering of limited partnership interests in the Jones Cable Income
Fund 1 Limited Partnership Program (the "Program"), which was sponsored by
Jones Intercable, Inc. (the "General Partner"). Jones Cable Income Fund 1-B,
Ltd. and Jones Cable Income Fund 1-C, Ltd. are the other partnerships that were
formed pursuant to the Program. The Partnership was formed for the purpose of
acquiring and operating cable television systems.
The Partnership owns the cable television systems serving the
communities of Milwaukie, Oregon (the "Milwaukie System") and Owatonna and
Glencoe, Minnesota (the "Owatonna/Glencoe System"). The Milwaukie System and
the Owatonna/Glencoe System may hereinafter collectively be referred to as the
"Systems."
A primary objective of the Partnership is to provide quarterly cash
distributions from operating cash flow to the limited partners. The
Partnership declared distributions of $980,000 in 1994, all of which were paid
during 1994 except $235,000, which was paid on February 15, 1995. Future
distributions will be announced on a quarter-by-quarter basis, and no
determination has been made regarding any specific level of future
distributions. If the General Partner is unable to renegotiate the
Partnership's credit facility to extend the revolving credit period and to
increase the amount of available borrowings, the Partnership may have to reduce
or suspend cash distributions because it will need to fund capital expenditures
from operating cash flow. The payment of quarterly operating cash flow
distributions may reduce the financial flexibility of the Partnership. See
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
CABLE TELEVISION SERVICES. The Systems offer to their subscribers
various types of programming, which include basic service, tier service,
premium service, pay-per-view programs and packages including several of these
services at combined rates.
Basic cable television service usually consists of signals of all four
national television networks, various independent and educational television
stations (both VHF and UHF) and certain signals received from satellites.
Basic service also usually includes programs originated locally by the system,
which may consist of music, news, weather reports, stock market and financial
information and live or videotaped programs of a public service or
entertainment nature. FM radio signals are also frequently distributed to
subscribers as part of the basic service.
The Systems offer tier services on an optional basis to their
subscribers. A tier generally includes most of the cable networks such as
Entertainment and Sports Programming Network (ESPN), Cable News Network (CNN),
Turner Network Television (TNT), Family Channel, Discovery and others, and the
cable television operators buy tier programming from these networks. The
Systems also offer a package that includes the basic service channels and the
tier services.
The Systems also offer premium services to their subscribers, which
consist of feature films, sporting events and other special features that are
presented without commercial interruption. The cable television operators buy
premium programming from suppliers such as HBO, Showtime, Cinemax or others at
a cost based on the number of subscribers the cable operator serves. Premium
service programming usually is significantly more expensive than the basic
service or tier service programming, and consequently cable operators price
premium service separately when sold to subscribers.
The Systems also offer to subscribers pay-per-view programming.
Pay-per-view is a service that allows subscribers to receive single programs,
frequently consisting of motion pictures that have recently completed their
theatrical exhibitions and major sporting events, and to pay for such service
on a program-by-program basis.
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REVENUES. Monthly service fees for basic, tier and premium services
constitute the major source of revenue for the Systems. In addition,
advertising sales are becoming a significant source of revenue for the Systems.
As a result of the adoption by the FCC of new rules under the Cable Television
Consumer Protection and Competition Act of 1992 (the "1992 Cable Act"), and
several rate regulation orders, the Systems' rate structures for cable
programming services and equipment have been revised. See Regulation and
Legislation. At December 31, 1994, the Systems' monthly basic service rates
ranged from $8.09 to $9.49, monthly basic and tier ("basic plus") service rates
ranged from $18.35 to $20.41 and monthly premium services ranged from $3.95 to
$9.95 per premium service. Charges for additional outlets have been
eliminated, and charges for remote controls and converters have been
"unbundled" from the programming service rates. In addition, the Partnership
earns revenues from the Systems' pay-per-view programs and advertising fees.
Related charges may include a nonrecurring installation fee that ranges from
$1.99 to $55.00; however, from time to time the Systems have followed the
common industry practice of reducing or waiving the installation fee during
promotional periods. Commercial subscribers such as hotels, motels and
hospitals are charged a nonrecurring connection fee that usually covers the
cost of installation. Except under the terms of certain contracts with
commercial subscribers and residential apartment and condominium complexes, the
subscribers are free to discontinue the service at any time without penalty.
For the year ended December 31, 1994, of the total fees received by the
Systems, basic service and tier service fees accounted for approximately 72% of
total revenues, premium service fees accounted for approximately 13% of total
revenues, pay-per-view fees were approximately 1% of total revenues,
advertising fees were approximately 4% of total revenues and the remaining 10%
of total revenues came principally from equipment rentals, installation fees
and program guide sales. The Partnership is dependent upon the timely receipt
of service fees to provide for maintenance and replacement of plant and
equipment, current operating expenses and other costs of the Systems.
The Partnership's business consists of providing cable television
services to a large number of customers, the loss of any one of which would
have no material effect on the Partnership's business. Each of the Systems has
had some subscribers who later terminated the service. Terminations occur
primarily because people move to another home or to another city. In other
cases, people terminate on a seasonal basis or because they no longer can
afford or are dissatisfied with the service. The amount of past due accounts
in the Systems is not significant. The General Partner's policy with regard to
past due accounts is basically one of disconnecting service before a past due
account becomes material.
The Partnership does not depend to any material extent on the
availability of raw materials; it carries no significant amounts of inventory
and it has no material backlog of customer orders. The Partnership has no
employees because all properties are managed by employees of the General
Partner. The General Partner has engaged in research and development
activities relating to the provision of new services but the amount of the
Partnership's funds expended for such research and development has never been
material.
Compliance with Federal, state and local provisions that have been
enacted or adopted regulating the discharge of materials into the environment
or otherwise relating to the protection of the environment has had no material
effect upon the capital expenditures, earnings or competitive position of the
Partnership.
FRANCHISES. The Systems are constructed and operated under
non-exclusive, fixed-term franchises or other types of operating authorities
(referred to collectively herein as "franchises") granted by local governmental
authorities. The Systems' franchises require that franchise fees ranging from
3% to 5% of gross revenues of the cable system be paid to the governmental
authority that granted the franchise, that certain channels be dedicated to
municipal use, that municipal facilities, hospitals and schools be provided
cable service free of charge and that any new cable plant be substantially
constructed within specific periods. (See Item 2 for a range of franchise
expiration dates of the Systems.)
The responsibility for franchising of cable television systems
generally is left to state and local authorities. There are, however, several
provisions in the Communications Act of 1934, as amended, that govern the terms
and conditions under which cable television systems provide service, including
the standards applicable to cable television operators seeking renewal of a
cable television franchise. In addition, the 1992 Cable Act also
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made several procedural changes to the process under which a cable operator
seeks to enforce its renewal rights which could make it easier in some cases
for a franchising authority to deny renewal. Generally, the franchising
authority can finally decide not to renew a franchise only if it finds that the
cable operator has not substantially complied with the material terms of the
franchise, has not provided reasonable service in light of the community's
needs, does not have the financial, legal and technical ability to provide the
services being proposed for the future, or has not presented a reasonable
proposal for future service. A final decision of non-renewal by the
franchising authority is appealable in court. The General Partner and its
affiliates recently have experienced lengthy negotiations with some franchising
authorities for the granting of franchise renewals and transfers. Some of the
issues involved in recent renewal negotiations include rate reregulation,
customer service standards, cable plant upgrade or replacement and shorter
terms of franchise agreements. The inability of the Partnership to renew a
franchise, or lengthy negotiations or litigation involving the renewal process
could have an adverse impact on the business of the Partnership.
COMPETITION. Cable television systems currently experience
competition from several sources, but two technologies, Multichannel Multipoint
Distribution Service ("MMDS") systems, commonly called wireless cable systems,
and Direct Broadcast Satellite ("DBS") systems, which distribute programming to
home satellite dishes, currently pose the greatest potential threat to the
cable television industry.
MMDS systems will likely focus on providing service to residents of
rural areas that are not served by cable television systems, but providers of
programming via MMDS systems will generally have the potential to compete
directly with cable television systems in urban areas as well, and in some
areas of the country, MMDS systems are now in direct competition with cable
television systems. To date, the Partnership has not lost a significant number
of subscribers, nor a significant amount of revenue, to MMDS operators
competing with its cable television systems.
DBS operators deliver premium channel services and specialized
programming to subscribers by high-powered DBS satellites on a wide-scale
basis, and two major companies began operations in 1994. Subscribers are able
to receive DBS services virtually anywhere in the United States with a rooftop
or wall-mounted antenna. In some instances, DBS systems may serve as a
complement to cable television operations by enabling cable television
operators to offer additional channels of programming without the construction
of additional cable plant. DBS companies use video compression technology to
increase the channel capacity of their satellite systems to provide a wide
variety of program services that are competitive with those of cable television
systems.
Cable television systems also compete with broadcast television,
private cable television systems known as Master Antenna Television ("MATV"),
Satellite Master Antenna Television ("SMATV") and Television Receive-Only Earth
Stations ("TVRO"). MATV and SMATV generally serve multi-unit dwellings such as
condominiums, apartment complexes and private residential communities, and
TVROs are satellite receiving antenna dishes that are used by "backyard users."
There is also potential competition from an emerging technology, Local
Multipoint Distribution Service ("LMDS"). When it is authorized for service,
the LMDS, sometimes referred to as cellular television, could have the
capability of delivering approximately 50 channels, or if two systems were
combined 100 channels, of video programming to a subscriber's home, which
capacity could be increased by using video compression technology. The General
Partner believes that there are not any current fully operational LMDS systems.
Although the Systems have not yet encountered competition from a
telephone company entering into the business of providing video services to
subscribers, the Systems could potentially face competition from telephone
companies doing so. A Federal cross-ownership restriction has historically
limited entry into the cable television business by potentially strong
competitors such as telephone companies. This restriction, which is contained
in the 1984 Cable Act, has generally prohibited telephone companies from owning
or operating cable television systems within their own telephone service areas,
but several recent court decisions have eliminated this restriction. In
addition, the FCC is authorizing telephone companies to provide video dialtone
service within their
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service areas. Legislation is also pending in Congress that would permit
telephone companies to provide video programming thorough separate
subsidiaries. The General Partner cannot predict at this time to what extent
current restrictions will be modified to permit telephone companies to provide
cable television services within their own service areas in competition with
cable television systems. See Regulation and Legislation, Ownership and Market
Structure for a description of the potential participation of the telephone
industry in the delivery of cable television services. Entry into the market
by telephone companies as direct competitors of the Systems could adversely
impact the profitability of the Systems. If a telephone company were to become
a direct competitor of the Partnership in an area served by a Partnership
System, the Partnership could be at a competitive disadvantage because of the
relative financial strength of a telephone company compared to the Partnership.
Depending on a number of factors, such competition could also result in cable
television systems providing the same types of services now provided by the
telephone industry.
The FCC has established a new wireless telecommunications service
known as Personal Communications Service ("PCS"). It is envisioned that PCS
would provide portable non-vehicular mobile communications services similar to
that available from cellular telephone companies, but at a lower cost. PCS
would be delivered by placing numerous microcells in a particular area to be
covered, accessible to both residential and business customers. Because of the
need to link the many microcells necessary to deliver this service
economically, many parties are investigating integration of PCS with cable
television operations. Several cable television multiple systems operators and
others, including affiliates of the General Partner, hold or have requested
experimental licenses from the FCC to test PCS technology. The FCC has
established spectrum auctioning procedures for PCS licenses and the licenses
are being auctioned in a series of auction events.
Cable television franchises are not exclusive, so that more than one
cable television system may be built in the same area (known as an
"overbuild"), with potential loss of revenues to the operator of the original
cable television system. The Systems currently face no direct competition from
other cable television operators.
COMPETITION FOR SUBSCRIBERS IN THE PARTNERSHIP'S SYSTEMS. Following
is a summary of competition from DBS, MMDS, SMATV and TVRO operators in the
Systems' franchise areas:
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Milwaukie System There are no MMDS, SMATV or TVRO operators in the system's service
area. DBS service is available in the system's service area;
however, it currently provides minimal competition.
Owatonna/Glencoe System There are no MMDS, SMATV or TVRO operators in the system's service
area. DBS service is available in the system's service area;
however, it currently provides minimal competition.
</TABLE>
REGULATION AND LEGISLATION. The cable television industry is
regulated through a combination of the Federal Communications Commission
("FCC"), some state governments, and most local governments. In addition, the
Copyright Act of 1976 imposes copyright liability on all cable television
systems. Cable television operations are subject to local regulation insofar
as systems operate under franchises granted by local authorities.
Cable Television Consumer Protection and Competition Act of 1992. On
October 5, 1992, Congress enacted the Cable Television Consumer Protection and
Competition Act of 1992 (the "1992 Cable Act"), which became effective on
December 4, 1992. This legislation has caused significant changes to the
regulatory environment in which the cable television industry operates. The
1992 Cable Act generally allows for a greater degree of regulation of the cable
television industry. Under the 1992 Cable Act's definition of effective
competition, nearly all cable television systems in the United States,
including those owned and managed by the General Partner, are subject to rate
regulation of basic cable services. In addition, the 1992 Cable Act allows the
FCC to regulate rates for non-basic service tiers other than premium services
in response to complaints filed by franchising authorities and/or cable
subscribers. In April 1993, the FCC adopted regulations governing rates for
basic and non-basic services. The FCC's rules became effective on September 1,
1993.
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In compliance with these rules, the General Partner reduced rates
charged for certain regulated services effective September 1, 1993. These
reductions resulted in some decrease in revenues and operating income before
depreciation and amortization; however, the decrease was not as severe as
originally anticipated. The General Partner has undertaken actions to mitigate
a portion of these reductions primarily through (a) new service offerings in
some systems, (b) product re-marketing and re-packaging and (c) marketing
efforts directed at non-subscribers.
On February 22, 1994, however, the FCC adopted several additional rate
orders including an order which revised its earlier-announced regulatory scheme
with respect to rates. The FCC's new regulations generally require rate
reductions, absent a successful cost-of-service showing, of 17% of September
30, 1992 rates, adjusted for inflation, channel modifications, equipment costs,
and increases in programming costs. However, the FCC held rate reductions in
abeyance in certain systems. The new regulations became effective on May 15,
1994, but operators could elect to defer rate reductions to July 14, 1994, so
long as they made no changes in their rates and did not restructure service
offerings between May 15 and July 14.
On February 22, 1994, the FCC also adopted interim cost-of-service
regulations. Rate reductions will not be required where it is successfully
demonstrated that rates for basic and other regulated programming services are
justified and reasonable using cost-of-service standards. The FCC established
an interim industry--wide 11.25% permitted rate of return, and requested
comments on whether this standard and other interim cost-of-service standards
should be made permanent. The FCC also established a presumption that
acquisition costs above a system's book value should be excluded from the rate
base, but the FCC will consider individual showings to rebut this presumption.
The need for special rate relief will also be considered by the FCC if an
operator demonstrates that the rates set by a cost-of-service proceeding would
constitute confiscation of investment, and that, absent a higher rate, the
return necessary to operate and to attract investment could not be maintained.
The FCC will establish a uniform system of accounts for operators that elect
cost-of-service rate regulation, and the FCC has adopted affiliate transaction
regulations. After a rate has been set pursuant to a cost-of-service showing,
rate increases for regulated services will be indexed for inflation, and
operators will also be permitted to increase rates in response to increases in
costs beyond their control, such as taxes and increased programming costs.
After analyzing the effects of the two methods of rate regulation, the
Partnership complied with the new benchmark regulations and further reduced
rates in its operating systems. The Partnership will continue its efforts to
mitigate the effect of such rate reductions.
Among other issues addressed by the FCC in its February rate orders
was the treatment of packages of a la carte channels. The FCC in its rate
regulations adopted April 1, 1993, exempted from rate regulation the price of
packages of a la carte channels upon the fulfillment of certain conditions. On
November 10, 1994, the FCC reversed its policy regarding rate regulation of
packages of a la carte services. A la carte services that are offered in a
package will not be subject to rate regulation by the FCC, although the FCC
indicated that it cannot envision circumstances in which any price for a
collective offering of premium channels that have traditionally been offered on
a per-channel basis would be found to be unreasonable.
On November 10, 1994, the FCC also announced a revision to its
regulations governing the manner in which cable operators may charge
subscribers for new cable programming services. In addition to the present
formula for calculating the permissible rate for new services, the FCC
instituted a three-year flat fee mark-up plan for charges relating to new
channels of cable programming services. Commencing on January 1, 1995,
operators may charge for new channels of cable programming services added after
May 14, 1994 at a rate of up to 20 cents per channel, but may not make
adjustments to monthly rates totaling more than $1.20 plus an additional 30
cents for programming license fees per subscriber over the first two years of
the three-year period for these new services. Operators may charge an
additional 20 cents in the third year only for channels added in that year plus
the costs for the programming. Operators electing to use the 20 cent per
channel adjustment may not also take a 7.5% mark-up on programming cost
increases, which is permitted under the FCC's current rate regulations. The
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FCC has requested further comment as to whether cable operators should continue
to receive the 7.5% mark-up on increases in license fees on existing
programming services.
The FCC also announced that it will permit operators to offer a "new
product tier" ("NPT"). Operators will be able to price this tier as they elect
so long as, among other conditions, other channels that are subject to rate
regulation are priced in conformity with applicable regulations and operators
do not remove programming services from existing tiers and offer them on the
NPT.
There have been several lawsuits filed by cable operators and
programmers in Federal court challenging various aspects of the 1992 Cable Act,
including provisions relating to mandatory broadcast signal carriage,
retransmission consent, access to cable programming, rate regulations,
commercial leased channels and public access channels. On April 8, 1993, a
three-judge Federal district court panel issued a decision upholding the
constitutionality of the mandatory signal carriage requirements of the 1992
Cable Act. That decision was appealed directly to the United States Supreme
Court. The United States Supreme Court vacated the lower court decision on
June 27, 1994 and remanded the case to the district court for further
development of a factual record. The Supreme Court's majority determined that
the must-carry rules were content neutral, but that it was not yet proven that
the rules were needed to preserve the economic health of the broadcasting
industry. In the interim, the must-carry rules will remain in place during the
pendency of the proceedings in district court. In 1993, a Federal district
court for the District of Columbia upheld provisions of the 1992 Cable Act
concerning rate regulation, retransmission consent, restrictions on vertically
integrated cable television operators and programmers, mandatory carriage of
programming on commercial leased channels and public, educational and
governmental access channels and the exemption for municipalities from civil
damage liability arising out of local regulation of cable services. The 1992
Cable Act's provisions providing for multiple ownership limits for cable
operators and advance notice of free previews for certain programming services
have been found unconstitutional. In November 1993, the United States Court of
Appeals for the D.C. Circuit held that the FCC's regulations implemented
pursuant to Section 10 of the 1992 Cable Act, which permit cable operators to
ban indecent programming on public, educational or governmental access channels
or leased access channels, were unconstitutional, but the court has agreed to
reconsider its decision. All of these decisions construing provisions of the
1992 Cable Act and the FCC's implementing regulations have been or are expected
to be appealed.
Ownership and Market Structure. The FCC rules and Federal law
generally prohibit the direct or indirect common ownership, operation, control
or interest in a cable television system, on the one hand, and a local
television broadcast station whose television signal reaches any portion of the
community served by the cable television system, on the other hand. The FCC
recently lifted its ban on the cross-ownership of cable television systems by
broadcast networks. The FCC revised its regulations to permit broadcast
networks to acquire cable television systems serving up to 10% of the homes
passed in the nation, and up to 50% of the homes passed in a local market.
Neither the Partnership nor the General Partner has any direct or indirect
ownership, operation, control or interest in a television broadcast station, or
a telephone company, and they are thus presently unaffected by the
cross-ownership rules.
The Cable Communications Policy Act of 1984 (the "1984 Cable Act") and
FCC regulations generally prohibit the common operation of a cable television
system and a telephone company within the same service area. Until recently, a
provision of a Federal court antitrust consent decree also prohibited the
regional Bell operating companies ("RBOCs") from engaging in cable television
operations. This prohibition was recently removed when the court retaining
jurisdiction over the consent decree ruled that the RBOCs could provide
information services over their facilities. This decision permits the RBOCs to
acquire or construct cable television systems outside of their own service
areas.
The 1984 Cable Act prohibited local exchange carriers, including the
RBOCs, from providing video programming directly to subscribers within their
local exchange telephone service areas, except in rural areas or by specific
waiver of FCC rules. Several Federal district courts have struck down the 1984
Cable Act's telco/cross-ownership provision as facially invalid and
inconsistent with the First Amendment. The United States Courts of Appeals for
the Fourth and the Ninth Circuits have upheld the appeals of two of these
district court decisions, and the United States Justice Department is expected
to request the United States Supreme Court to
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review these two decisions. This Federal cross-ownership rule is particularly
important to the cable industry since these telephone companies already own
certain facilities needed for cable television operation, such as poles, ducts
and associated rights-of-way.
The FCC amended its rules in 1992 to permit local telephone companies
to offer "video dialtone" service for video programmers, including channel
capacity for the carriage of video programming and certain noncommon carrier
activities such as video processing, billing and collection and joint marketing
arrangements. In its video dialtone order, which was part of a comprehensive
proceeding examining whether and under what circumstances telephone companies
should be allowed to provide cable television services, including video
programming to their customers, the FCC concluded that neither the 1984 Cable
Act nor its rules apply to prohibit the interexchange carriers (i.e., long
distance telephone companies such as AT&T) from providing such services to
their customers. Additionally, the FCC also concluded that where a local
exchange carrier ("LEC") makes its facilities available on a common carrier
basis for the provision of video programming to the public, the 1984 Cable Act
does not require the LEC or its programmer customers to obtain a franchise to
provide such service. This aspect of the FCC's video dialtone order was upheld
on appeal by the United States Court of Appeals for the D.C. Circuit. The FCC
recently issued an order reaffirming its initial decision, and this order has
been appealed. Because cable operators are required to bear the costs of
complying with local franchise requirements, including the payment of franchise
fees, the FCC's decision could place cable operators at a competitive
disadvantage vis-a-vis services offered on a common carrier basis over local
telephone company provided facilities. In its Reconsideration Order, the FCC,
among other actions, refused to require telephone companies to justify cost
allocations prior to the construction of video dialtone facilities, and
indicated that it would provide guidance on costs that must be included in
proposed video dialtone tariffs. The FCC also established dual Federal/state
jurisdiction over video dialtone services based on the origination point of the
video dialtone programming service. In a separate proceeding, the FCC has
proposed to increase the numerical limit on the population of areas qualifying
as "rural" and in which LECs can provide cable service without a FCC waiver.
On January 12, 1995, the FCC adopted a Fourth Further Notice of
Proposed Rulemaking in its video dialtone docket. The FCC tentatively
concluded that it should not ban telephone companies from providing their own
video programming over their video dialtone platforms in those areas in which
the cable/telephone cross-ownership rules have been found unconstitutional.
The FCC requested comments on this issue and on further refinements of its
video dialtone regulatory framework concerning, among other issues, telephone
programmer affiliation standards, the establishment of structural safeguards to
prevent cross-subsidization of video dialtone and programming activities, and
the continuation of the FCC's ban prohibiting telephone companies from
acquiring cable systems within their telephone service areas for the provision
of video dialtone services. The FCC will also consider whether a LEC offering
video dialtone service must secure a local franchise if that LEC also engages
in the provision of video programming carried on its video dialtone platform.
The FCC has also proposed to broadly interpret its authority to waive the
cable/telephone cross-ownership ban upon a showing by telephone companies that
they comply with the safeguards which the FCC establishes as a condition of
providing video programming.
A number of bills that would have permitted telephone companies to
provide cable television service within their own service areas were considered
during the last Congress, but none were adopted. These bills would have
permitted the provision of cable television service by telephone companies in
their own service areas conditioned on the establishment of safeguards to
prevent cross-subsidization between telephone and cable television operations
and the provision of telecomunication services by cable television systems.
Similar legislation is expected to be considered by Congress during its current
session. The outcome of these FCC, legislative or court proceedings and
proposals or the effect of such outcome on cable system operations cannot be
predicted.
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ITEM 2. PROPERTIES
The cable television systems owned by the Partnership at December 31,
1994 are described below:
<TABLE>
<CAPTION>
SYSTEM ACQUISITION DATE
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<S> <C>
Owatonna/Glencoe System July 1986
Milwaukie System July 1986
</TABLE>
The following sets forth (i) the monthly basic plus service rates
charged to subscribers, (ii) the number of basic subscribers and pay units and
(iii) the range of franchise expiration dates for the Systems. The monthly
basic service rates set forth herein represent, with respect to systems with
multiple headends, the basic service rate charged to the majority of the
subscribers within the system. While the charge for basic plus service may
have increased in some cases in 1993 as a result of the FCC's rate regulations,
overall revenues may have decreased due to the elimination of charges for
additional outlets and certain equipment. In cable television systems, basic
subscribers can subscribe to more than one pay TV service. Thus, the total
number of pay services subscribed to by basic subscribers are called pay units.
As of December 31, 1994, the Partnership's Systems operated approximately 200
miles of cable plant, passing approximately 19,000 homes, representing an
approximate 66% penetration rate. Figures for numbers of subscribers, miles of
cable plant and homes passed are compiled from the General Partner's records
and may be subject to adjustments.
<TABLE>
<CAPTION>
At December 31,
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OWATONNA/GLENCOE, MINNESOTA 1994 1993 1992
--------------------------- ---- ---- ----
<S> <C> <C> <C>
Monthly basic plus service rate $20.41 $21.32 $20.45
Basic subscribers 7,711 7,536 7,116
Pay units 3,895 3,393 3,159
</TABLE>
Franchise expiration dates range from April 1997 to June 1998.
<TABLE>
<CAPTION>
At December 31,
-------------------------------------------------------------
MILWAUKIE, OREGON 1994 1993 1992
----------------- ---- ---- ----
<S> <C> <C> <C>
Monthly basic plus service rate $20.39 $22.00 $20.00
Basic subscribers 5,211 4,780 4,565
Pay units 3,091 2,802 2,784
</TABLE>
The franchise expiration date is June 1998.
PROGRAMMING SERVICES
Programming services provided by the Systems include local affiliates
of the national broadcast networks, local independent broadcast channels, the
traditional satellite services (e.g., American Movie Classics, Arts &
Entertainment, Black Entertainment Network, C-SPAN, The Discovery Channel,
Lifetime, Entertainment Sports Network, Home Shopping Network, Mind Extension
University, Music Television, Nickelodeon, Turner Network Television, The
Nashville Network, Video Hits One, and superstations WOR, WGN and TBS. The
Partnership's Systems also provide a selection, which varies by system, of
premium channel programming (e.g., Cinemax, Encore, Home Box Office, Showtime
and The Movie Channel).
ITEM 3. LEGAL PROCEEDINGS
None.
9
<PAGE> 10
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK
AND RELATED SECURITY HOLDER MATTERS
While the Partnership is publicly held, there is no public market for
the limited partnership interests, and it is not expected that a market will
develop in the future. As of February 15, 1995, the approximate number of
equity security holders in the Partnership was 980.
10
<PAGE> 11
Item 6. Selected Financial Data
<TABLE>
<CAPTION>
For the Year Ended December 31,
---------------------------------------------------------------------------------
1994 1993 1992 1991 1990
------------- --------------- --------------- --------------- -------------
<S> <C> <C> <C> <C> <C>
Revenues $4,294,257 $4,111,369 $ 3,855,621 $ 3,467,416 $3,055,267
Depreciation and Amortization 882,035 832,444 726,340 889,428 978,441
Operating Income (Loss) 299,402 333,627 420,856 123,407 (13,795)
Net Income (Loss) 93,845 195,588 290,566 (18,075) (134,088)
Net Income (Loss) per Limited Partnership Unit 5.47 11.39 16.92 (1.05) (7.81)
Distributions per Limited Partnership Unit 57.65 60.59 57.65 48.24 40.59
Weighted average Number of
Limited Partnership Units Outstanding 17,000 17,000 17,000 17,000 17,000
General Partner's Deficit (71,045) (62,083) (53,637) (46,644) (38,181)
Limited Partners' Capital 198,516 1,085,609 1,921,977 2,614,317 3,452,211
Total Assets 4,755,245 4,903,310 5,113,305 5,021,663 5,307,963
Debt 3,584,706 3,310,501 2,683,562 2,048,123 1,445,211
General Partner Advances 483,487 20,529 19,356 - 17,096
</TABLE>
11
<PAGE> 12
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
JONES CABLE INCOME FUND 1-A, LTD.
Results of Operations
1994 Compared to 1993-
Revenues of the Partnership increased $182,888, or approximately 4
percent, from $4,111,369 in 1993 to $4,294,257 in 1994. The increase in
revenues was primarily the result of increases in basic subscribers, equipment
sales and advertising revenues. Since December 31, 1993, the Partnership's
cable systems added 786 basic subscribers, increasing from 12,136 basic
subscribers at December 31, 1993 to 12,922 basic subscribers at December 31,
1994. The increase in revenues would have been greater but for the reduction
in certain rates charged due to basic rate regulations issued by the FCC in
April 1993 and February 1994 with which the Partnership complied effective
September 1993 and July 1994, respectively. See Item 1. No other individual
factor significantly affected the increase in revenues.
Operating, general and administrative expenses increased $109,354, or
approximately 4 percent, from $2,435,055 in 1993 to $2,544,409 in 1994.
Operating, general and administrative expense represented 59 percent of revenue
in 1993 and 1994. Increased advertising sales costs accounted for
approximately 37 percent of the increase in expenses. Increased programming
costs, due in part to the increase in the subscriber base, accounted for
approximately 14 percent of the increase in expenses. No other individual
factor significantly affected the increase in operating, general and
administrative expenses. Management fees and allocated overhead from the
General Partner increased $58,168, or approximately 11 percent, from $510,243
in 1993 to $568,411 in 1994 due primarily to the increase in revenues, upon
which such fees and allocations are based, and an increase in allocated
expenses from the General Partner. The General Partner has experienced
increases in expenses, including personnel costs and reregulation costs, a
portion of which is allocated to the Partnership.
Depreciation and amortization expense increased $49,591, or
approximately 6 percent, from $832,444 in 1993 to $882,035 in 1994. This
increase was due to the purchase of property, plant and equipment in 1993 and
1994.
Operating income decreased $34,225, or approximately 10 percent, from
$333,627 in 1993 to $299,402 in 1994. This decrease was due to the increases
in depreciation and amortization, operating, general and administrative
expenses and management fees and allocated overhead from the General Partner
exceeding the increase in revenues. Operating income before depreciation and
amortization increased $15,366, or approximately 1 percent, from $1,166,071 in
1993 to $1,181,437 in 1994. This increase was due to the increase in revenues
exceeding the increases in operating, general and administrative expenses and
management fees and allocated overhead from the General Partner.
Interest expense increased $76,336, or approximately 55 percent, from
$137,697 in 1993 to $214,033 in 1994 due to higher outstanding balances on
interest bearing obligations and to higher interest rates. Net income
decreased $63,532, or approximately 32 percent, from $195,588 in 1993 to
$132,056 in 1994 due to the factors discussed above.
1993 Compared to 1992-
Revenues of the Partnership increased $255,748, or approximately 7
percent, from $3,855,621 in 1992 to $4,111,369 in 1993. An increase in the
basic subscriber base accounted for approximately 23 percent of the increase in
revenues. Basic service rate adjustments primarily accounted for the remainder
of the increase in revenues. The increase in revenue would have been greater
but for the reduction in certain rates charged due to new basic rate
regulations issued by the FCC in April 1993 with which the Partnership complied
effective September 1, 1993. No other individual factor significantly affected
the increase in revenues.
Operating, general and administrative expenses increased $206,268, or
approximately 9 percent, from $2,228,787 in 1992 to $2,435,055 in 1993.
Operating, general and administrative expense represented 58 percent of revenue
in 1992 compared to 59 percent in 1993. Increased programming costs, due in
part to the increase in subscriber base, accounted for approximately 46 percent
of the increase in expenses. Increased personnel and marketing costs accounted
for approximately 19 percent and 17 percent, respectively, of the increase in
expenses. No other individual factor significantly affected the increase in
operating, general and administrative expenses. Management fees and allocated
overhead from the
12
<PAGE> 13
General Partner increased $30,605, or approximately 6 percent, from $479,638 in
1992 to $510,243 in 1993 due primarily to the increase in revenues, upon which
such fees and allocations are calculated, and an increase in expenses allocated
from the General Partner.
Depreciation and amortization expense increased $106,104, or
approximately 15 percent, from $726,340 in 1992 to $832,444 in 1993. This
increase was due to the purchase of property, plant and equipment in 1992 and
1993.
Operating income decreased $87,229, or approximately 21 percent, from
$420,856 in 1992 to $333,627 in 1993. This was due to the increases in
depreciation and amortization, operating, general and administrative expense
and management fees and allocated overhead from the General Partner exceeding
the increases in revenue. Operating income before depreciation and
amortization increased $18,875, or approximately 2 percent, from $1,147,196 in
1992 to $1,166,071 in 1993. This increase was due to the increase in revenues
exceeding the increases in operating, general and administrative expenses and
management fees and allocated overhead from the General Partner.
Interest expense increased $6,800, or approximately 5 percent, from
$130,897 in 1992 to $137,697 in 1993 due to higher outstanding balances on
interest bearing obligations. Net income decreased $94,978, or approximately
33 percent, to $195,588 in 1993 from $290,566 in 1992 due to the factors
discussed above.
Financial Condition
The Partnership expended approximately $659,000 on capital
improvements during 1994. Of this total, approximately 22 percent was for the
upgrade of equipment within the Partnership's systems. The construction of
service drops to subscriber's homes accounted for approximately 24 percent of
the total expenditures. The purchase of converters accounted for approximately
21 percent of the total expenditures. The remainder of the expenditures
related to various enhancements in each of the Partnership's systems. Funding
for these expenditures was provided primarily by borrowings under the
Partnership's credit facility and advances from the General Partner.
Anticipated capital expenditures for 1995 total approximately $652,000. Of
this total approximately 27 percent is for construction of service drops to
subscribers' homes, approximately 18 percent is for the purchase of premium
service converters and approximately 9 percent is for the replacement of
vehicles. The remainder of the expenditures are for various enhancements in
the Partnership's cable television systems. Funding for these expenditures is
expected to be provided by cash generated from operations and, if available,
borrowings under a renegotiated credit facility and, in its discretion,
advances from the General Partner.
On September 28, 1992, the Partnership entered into a $3,500,000
revolving credit facility. The revolving credit period expires March 31, 1995,
at which time the outstanding balance converts to a term loan with a final
maturity of March 31, 1999. Proceeds from this facility were used to repay
amounts outstanding on the Partnership's previous credit facility, to repay
amounts due the General Partner and to finance capital expenditures. The
balance outstanding on the Partnership's revolving credit facility at December
31, 1994 was $3,500,000. The General Partner expects to renegotiate the
Partnership's revolving credit facility to increase the maximum amount
available to fund capital expenditures. If the General Partner is unsuccessful
in renegotiating the revolving credit facility, the Partnership may have to
reduce the level of capital expenditures. Interest on outstanding principal
amounts is computed at the Partnership's option of LIBOR plus 1 percent or the
Prime rate plus 1/4 percent.
A primary objective of the Partnership is to provide quarterly cash
distributions from operating cash flow to the limited partners. During 1994,
the Partnership declared such distributions totaling $980,000 of which all were
paid during 1994 except $235,000, which was paid on February 15, 1995. Future
distributions will be announced on a quarter-by-quarter basis and no
determination has been made regarding any specific level of future
distributions. The payment of quarterly operating cash flow distributions may
reduce the financial flexibility of the Partnership. If the General Partner is
unable to renegotiate the Partnership's credit facility as discussed above, the
Partnership may have to reduce or suspend cash distributions because it will
need to fund capital expenditures from cash generated from operations.
13
<PAGE> 14
Regulation and Legislation
On October 5, 1992, Congress enacted the Cable Television Consumer
Protection and Competition Act of 1992 (the "1992 Cable Act"), which became
effective on December 4, 1992. The 1992 Cable Act generally allows for a
greater degree of regulation of the cable television industry. In April 1993,
the FCC adopted regulations governing rates for basic and non-basic services.
These regulations became effective on September 1, 1993. Such regulations
caused reductions in rates for certain regulated services. On February 22,
1994, the FCC adopted several additional rate orders including an order which
revised its earlier-announced regulatory scheme with respect to rates. The
Partnership has complied with the February 1994 benchmark regulations and
further reduced rates in the Milwaukie System and the Owatonna/Glencoe System
effective July 1994. See Item 1 for further discussion of the provisions of
the 1992 Cable Act and the FCC regulations promulgated thereunder.
14
<PAGE> 15
Item 8. Financial Statements
JONES CABLE INCOME FUND 1-A
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1994 AND 1993
INDEX
<TABLE>
<CAPTION>
Page
-----
<S> <C>
Report of Independent Public Accountants 16
Balance Sheets 17
Statements of Operations 19
Statements of Partners Capital (Deficit) 20
Statements of Cash Flows 21
Notes to Financial Statements 22
</TABLE>
15
<PAGE> 16
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Partners of Jones Cable Income Fund 1-A:
We have audited the accompanying balance sheets of JONES CABLE
INCOME FUND 1-A (a Colorado limited partnership) as of December 31, 1994 and
1993, and the related statements of operations, partners' capital (deficit) and
cash flows for each of the three years in the period ended December 31, 1994.
These financial statements are the responsibility of the General Partner's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of Jones Cable
Income Fund 1-A as of December 31, 1994 and 1993, and the results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1994, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Denver, Colorado,
March 8, 1995.
16
<PAGE> 17
JONES CABLE INCOME FUND 1-A
(A Limited Partnership)
BALANCE SHEETS
<TABLE>
<CAPTION>
December 31,
------------------------------------
ASSETS 1994 1993
------ -------------- --------------
<S> <C> <C>
CASH $ 78,286 $ 61,322
TRADE RECEIVABLES, less allowance for doubtful
receivables of $748 and $6,117 at December 31, 1994
and 1993, respectively 70,273 57,745
INVESTMENT IN CABLE TELEVISION PROPERTIES:
Property, plant and equipment, at cost 9,561,181 8,901,952
Less- accumulated depreciation (5,291,706) (4,650,013)
------------ -------------
4,269,475 4,251,939
Franchise costs, net of accumulated amortization
of $545,913 and $481,053 at December 31, 1994
and 1993, respectively 181,087 245,947
Subscriber lists, net of accumulated amortization
of $1,403,000 and $1,281,604 at December 31, 1994
and 1993, respectively - 121,396
Cost in excess of interests in net assets purchased,
net of accumulated amortization of $38,782 and
$34,174 at December 31, 1994 and 1993, respectively 145,218 149,826
------------ -------------
Total investment in cable television properties 4,595,780 4,769,108
DEPOSITS, PREPAID EXPENSES AND DEFERRED CHARGES 10,906 15,135
------------ -------------
Total assets $ 4,755,245 $ 4,903,310
============ =============
</TABLE>
The accompanying notes to financial statements
are an integral part of these balance sheets.
17
<PAGE> 18
JONES CABLE INCOME FUND 1-A
(A Limited Partnership)
BALANCE SHEETS
<TABLE>
<CAPTION>
December 31,
--------------------------------------
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) 1994 1993
- --------------- -------------- --------------
<S> <C> <C>
LIABILITIES:
Debt $ 3,584,706 $ 3,310,501
Accounts payable-
Trade 7,285 4,196
General Partner 483,487 20,529
Accrued liabilities 262,401 234,531
Accrued distribution to limited partners 235,000 250,000
Subscriber prepayments 54,895 60,027
----------- -----------
Total liabilities 4,627,774 3,879,784
----------- -----------
COMMITMENTS AND CONTINGENCIES (Note 8)
PARTNERS' CAPITAL (DEFICIT):
General Partner-
Contributed capital 1,000 1,000
Accumulated deficit (5,896) (6,834)
Distributions (66,149) (56,249)
----------- -----------
(71,045) (62,083)
----------- -----------
Limited Partners-
Net contributed capital
(17,000 units outstanding at
December 31, 1994 and 1993) 7,288,694 7,288,694
Accumulated deficit (541,178) (634,085)
Distributions (6,549,000) (5,569,000)
----------- -----------
198,516 1,085,609
----------- -----------
Total liabilities and partners'
capital (deficit) $ 4,755,245 $ 4,903,310
=========== ===========
</TABLE>
The accompanying notes to financial statements
are an integral part of these balance sheets.
18
<PAGE> 19
JONES CABLE INCOME FUND 1-A
(A Limited Partnership)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------------------------------
1994 1993 1992
-------------- -------------- --------------
<S> <C> <C> <C>
REVENUES $ 4,294,257 $ 4,111,369 $ 3,855,621
COSTS AND EXPENSES:
Operating, general and administrative 2,544,409 2,435,055 2,228,787
Management fees and allocated overhead
from General Partner 568,411 510,243 479,638
Depreciation and amortization 882,035 832,444 726,340
------------ ------------ ------------
OPERATING INCOME 299,402 333,627 420,856
------------ ------------ ------------
OTHER INCOME (EXPENSE):
Interest expense (214,033) (137,697) (130,897)
Other, net 8,476 (342) 607
------------ ------------ ------------
Total other income (expense) (205,557) (138,039) (130,290)
------------ ------------ ------------
NET INCOME $ 93,845 $ 195,588 $ 290,566
============ ============ ============
ALLOCATION OF NET INCOME:
General Partner $ 938 $ 1,956 $ 2,906
============ ============ ============
Limited Partners $ 92,907 $ 193,632 $ 287,660
============ ============ ============
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 5.47 $ 11.39 $ 16.92
============ ============ ============
WEIGHTED AVERAGE NUMBER OF LIMITED
PARTNERSHIP UNITS OUTSTANDING 17,000 17,000 17,000
============ ============ ============
</TABLE>
The accompanying notes to financial statements
are an integral part of these statements.
19
<PAGE> 20
JONES CABLE INCOME FUND 1-A
(A Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
<TABLE>
<CAPTION>
Year Ended December 31,
---------------------------------------------------------
1994 1993 1992
-------------- -------------- --------------
<S> <C> <C> <C>
GENERAL PARTNER:
Balance, beginning of year $ (62,083) $ (53,637) $ (46,644)
Distributions (9,900) (10,402) (9,899)
Net income for year 938 1,956 2,906
----------- ------------ -----------
Balance, end of year $ (71,045) $ (62,083) $ (53,637)
=========== ============ ===========
LIMITED PARTNERS:
Balance, beginning of year $ 1,085,609 $ 1,921,977 $ 2,614,317
Distributions (980,000) (1,030,000) (980,000)
Net income for year 92,907 193,632 287,660
----------- ------------ -----------
Balance, end of year $ 198,516 $ 1,085,609 $ 1,921,977
=========== ============ ===========
</TABLE>
The accompanying notes to financial statements
are an integral part of these statements.
20
<PAGE> 21
JONES CABLE INCOME FUND 1-A
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------------------------------
1994 1993 1992
------------ ------------ ------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 93,845 $ 195,588 $ 290,566
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 882,035 832,444 726,340
Decrease (increase) in trade receivables (12,528) 22,087 (20,950)
Decrease (increase) in deposits, prepaid
expenses and deferred charges (40,149) (5,242) 1,088
Increase in trade accounts payable,
accrued liabilities and subscriber
prepayments 10,827 6,305 86,281
Increase in advances from General Partner 462,958 1,173 19,356
----------- ----------- -----------
Net cash provided by operating activities 1,396,988 1,052,355 1,102,681
----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net (659,229) (616,099) (781,316)
----------- ----------- -----------
Net cash used in investing activities (659,229) (616,099) (781,316)
----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 309,987 747,399 2,700,000
Repayment of debt (35,782) (120,460) (2,064,561)
Cash flow distributions to limited partners (980,000) (1,030,000) (980,000)
Increase (decrease) in accrued distributions to
limited partners (15,000) (10,000) 40,000
----------- ----------- -----------
Net cash used in financing activities (720,795) (413,061) (304,561)
----------- ----------- -----------
Increase in cash 16,964 23,195 16,804
Cash, beginning of year 61,322 38,127 21,323
----------- ----------- -----------
Cash, end of year $ 78,286 $ 61,322 $ 38,127
=========== =========== ===========
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ 216,327 $ 135,955 $ 120,201
=========== =========== ===========
</TABLE>
The accompanying notes to financial statements
are an integral part of these statements.
21
<PAGE> 22
JONES CABLE INCOME FUND 1-A
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION AND PARTNERS' INTERESTS
Formation and Business
Jones Cable Income Fund 1-A, Ltd. (the "Partnership"), a Colorado
limited partnership, was formed on June 2, l986, under a public program
sponsored by Jones Intercable, Inc. ("Intercable"). The Partnership was formed
to acquire, develop and operate cable television systems. Intercable is the
"General Partner" and manager of the Partnership. The General Partner and its
subsidiaries also own and operate cable television systems. In addition, the
General Partner manages cable television systems for other limited partnerships
for which it is general partner and, also, for other affiliated entities. The
Partnership owns the cable television systems serving the communities of
Milwaukie, Oregon and Owatonna and Glencoe, Minnesota.
Contributed Capital
The capitalization of the Partnership is set forth in the
accompanying statements of partners' capital (deficit). No limited partner is
obligated to make any additional contribution to partnership capital.
The General Partner purchased its interest in the Partnership by
contributing $1,000 to partnership capital.
All profits and losses of the Partnership are allocated 99 percent
to the limited partners and 1 percent to the General Partner, except for income
or gain from the sale or disposition of cable television properties, which will
be allocated to the partners based upon the formula set forth in the
Partnership Agreement.
Cable Television System Acquisition
The Partnership's acquisitions were accounted for as purchases
with the purchase price allocated as follows: first, to the fair value of net
tangible assets acquired; second, to the value of subscriber lists and
franchise costs; and third, to costs in excess of interests in net assets
purchased. Brokerage fees paid to an affiliate of the General Partner and
additional acquisition costs were allocated to intangible assets based upon the
relative value of these assets at acquisition. Other system acquisition costs
were capitalized and included in the cost of distribution systems.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Records
The accompanying financial statements have been prepared on the
accrual basis of accounting in accordance with generally accepted accounting
principles. The Partnership's tax returns are also prepared on the accrual
basis.
22
<PAGE> 23
Property, Plant and Equipment
Depreciation of property, plant and equipment is provided
primarily using the straight-line method over the following estimated service
lives:
<TABLE>
<S> <C>
Cable distribution systems 5 - 15 years
Equipment and tools 5 years
Office furniture and equipment 5 - 15 years
Buildings 10 - 20 years
Vehicles 3 years
</TABLE>
Replacements, renewals and improvements are capitalized and
maintenance and repairs are charged to expense as incurred.
Intangible Assets
Costs assigned to franchises and cost in excess of interests in
net assets purchased are being amortized using the straight-line method over
the following remaining estimated useful lives:
<TABLE>
<S> <C>
Franchise costs 3 - 4 years
Cost in excess of interests in net assets purchased 32 years
</TABLE>
Revenue Recognition
Subscriber prepayments are initially deferred and recognized as
revenue when earned.
(3) TRANSACTIONS WITH THE GENERAL PARTNER AND AFFILIATES
Management Fees, Distribution Ratios and Reimbursement
The General Partner manages the Partnership and receives a fee for
its services equal to 5 percent of the gross revenues of the Partnership,
excluding revenues from the sale of cable television systems or franchises.
Management fees charged during the years ended December 31, 1994, 1993 and 1992
were $214,713, $205,568, and $192,781, respectively.
Any partnership distributions made from cash flow (defined as cash
receipts derived from routine operations, less debt principal and interest
payments and cash expenses) are allocated 99 percent to the limited partners
and 1 percent to the General Partner. Distributions resulting from the sale or
refinancing of a system or upon dissolution of the Partnership will be made as
follows: first, to the limited partners in an amount which together with all
prior distributions, other than those made regularly from cash flow, will equal
their initial capital contribution; second, payment to the limited partners of
a liquidation preference equal to a 10 percent cumulative return on their
initial capital contribution, reduced by all prior distributions from cash
flow; and the balance, 75 percent to the limited partners and 25 percent to the
General Partner.
The Partnership reimburses the General Partner for certain
allocated overhead and administrative expenses. These expenses represent
salaries and related benefits paid for corporate personnel, rent, data
processing services and other corporate facilities costs. Such personnel
provide engineering, marketing, administrative accounting, legal, and investor
relations services to the Partnership. Allocations of personnel costs are
based primarily on actual time spent by employees of the General Partner with
respect to each partnership managed. Remaining overhead costs are allocated
based on revenues and/or assets managed for the partnership. Effective
December 1, 1993, the allocation method was changed to be based only on
revenue, which the General Partner believes provides a more accurate method of
allocation. Systems owned by the General Partner and all other systems owned
by partnerships for which Intercable is the general partner are also allocated
a proportionate share of these expenses. The General Partner believes that the
methodology used in allocating overhead and administrative expenses is
reasonable. Amounts allocated to the Partnership by the General Partner for
overhead and administrative expenses during the years ended December 31, 1994,
1993 and 1992 were $353,698, $304,675 and $286,857, respectively.
23
<PAGE> 24
The Partnership was charged interest during 1994 at an average
rate of 10 percent on the amounts due to the General Partner, which
approximated the General Partner's weighted average cost of borrowing.
Interest charged totaled $11,769, $5,838 and $15,161 during 1994, 1993 and
1992, respectively, on the amounts due to the General Partner.
Payments to/from Affiliates for Programming Services
The Partnership receives programming from Product Information
Network, Superaudio, The Mind Extension University and Jones Computer Network,
affiliates of the General Partner. Payments to Superaudio totaled $7,598,
$7,488 and $7,467 in 1994, 1993 and 1992, respectively. Payments to The Mind
Extension University totaled $6,885, $4,363 and $4,279 in 1994, 1993 and 1992,
respectively. Payments to Jones Computer Network, which initiated service in
1994, totaled $1,611 in 1994. The Partnership receives a commission from
Product Information Network based on a percentage of advertising revenues and
number of subscribers. Product Information Network, which initiated service in
1994, paid commissions to the Partnership totalling $2,403 in 1994.
(4) DISTRIBUTIONS FROM CASH FLOW
One of the primary objectives of the Partnership is to provide
quarterly cash distributions to the General Partner and the limited partners.
Such cash returns are generated primarily from the net proceeds of payments by
cable television subscribers for the cable television services provided by the
Partnership. For the years ended December 31, 1994, 1993 and 1992, the
Partnership declared cash distributions totaling $989,900, $1,040,402 and
$989,899, respectively. The General Partner has agreed to defer its portion of
the distributions until the Partnership is liquidated. As of December 31,
1994, $66,149 had been deferred. All declared limited partner distributions
had been paid as of December 31, 1994, except for $235,000 which was paid on
February 15, 1995. No determination has been made regarding any specific level
of future distributions.
(5) PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of December 31, 1994 and 1993,
consisted of the following:
<TABLE>
<CAPTION>
December 31,
---------------------------------
1994 1993
---------------- ---------------
<S> <C> <C>
Cable distribution systems $ 8,175,165 $ 7,637,205
Equipment and tools 552,640 490,800
Office furniture and equipment 326,585 289,084
Buildings 110,963 108,319
Vehicles 245,828 226,544
Land 150,000 150,000
------------ ------------
9,561,181 8,901,952
Less- accumulated depreciation (5,291,706) (4,650,013)
------------ ------------
$ 4,269,475 $ 4,251,939
============ ============
</TABLE>
(6) DEBT
<TABLE>
<CAPTION>
Debt consists of the following: December 31,
---------------------------------
1994 1993
---------------- ---------------
<S> <C> <C>
Lending institutions-
Revolving credit agreement $3,500,000 $3,250,000
Capital lease obligations 84,706 60,501
---------- ----------
$3,584,706 $3,310,501
========== ==========
</TABLE>
24
<PAGE> 25
On September 28, 1992, the Partnership entered into a $3,500,000
revolving credit facility. The revolving credit period expires March 31, 1995,
at which time the outstanding balance converts to a term loan with a final
maturity of March 31, 1999. Proceeds from this revolving credit facility were
used to repay amounts outstanding on the Partnership's previous credit
facility, to repay amounts due the General Partner and to finance capital
expenditures. The balance outstanding on this revolving credit facility at
December 31, 1994 was $3,500,000. Interest on outstanding principal amounts is
computed at the Partnership's option of the London Interbank Offered Rate plus
1 percent, or Prime plus 1/4 percent. The effective interest rates on
outstanding obligations as of December 31, 1994 and 1993 were 7.29 percent and
4.63 percent, respectively.
Installments due on debt principal for the five years ending
December 31, 1999 and thereafter, respectively, are $550,412, $795,412,
$865,412, $1,058,470, $315,000 and $-0-. At December 31, 1994, substantially
all of the Partnership's assets secured the above indebtedness.
(7) INCOME TAXES
Income taxes have not been recorded in the accompanying financial
statements because they accrue directly to the partners. The Federal and state
income tax returns of the Partnership are prepared and filed by the General
Partner.
The Partnership tax returns, the qualification of the Partnership
as such for tax purposes, and the amount of distributable partnership income or
loss are subject to examination by Federal and state taxing authorities. If
such examinations result in changes with respect to the Partnership's
qualification as such, or in changes with respect to the Partnership's recorded
income or loss, the tax liability of the General and limited partners would
likely be changed accordingly.
Taxable loss reported to the partners is different from that
reported in the statements of operations due to the difference in depreciation
recognized under generally accepted accounting principles and the expense
allowed for tax purposes under the Modified Accelerated Cost Recovery System
(MACRS). There are no other significant differences between taxable loss and
the net loss reported in the statements of operations.
(8) COMMITMENTS AND CONTINGENCIES
The Partnership rents office and other facilities under various
long-term lease arrangements. Rent paid under such lease agreements totaled
$30,036, $27,313, and $30,268, respectively for the years ended December 31,
1994, 1993 and 1992. Minimum commitments under operating leases for each of
the five years in the period ending December 31, 1999, and thereafter are as
follows:
<TABLE>
<S> <C>
1995 $ 26,790
1996 26,790
1997 26,790
1998 20,092
1999 -
Thereafter -
---------
$ 100,462
=========
</TABLE>
25
<PAGE> 26
(9) SUPPLEMENTARY PROFIT AND LOSS INFORMATION
Supplementary profit and loss information for the respective
periods is presented below:
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------------------------------
1994 1993 1992
------------- ------------ ------------
<S> <C> <C> <C>
Maintenance and repairs $ 36,769 $ 32,446 $ 44,697
======= ======= =======
Taxes, other than income and payroll taxes $ 26,921 $ 28,737 $ 26,005
======= ======= =======
Advertising $ 50,447 $ 68,377 $ 42,224
======= ======= =======
Depreciation of property, plant and equipment $691,171 $590,176 $484,072
======= ======= =======
Amortization of intangible assets $190,864 $242,268 $242,268
======= ======= =======
</TABLE>
26
<PAGE> 27
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership itself has no officers or directors. Certain
information concerning the directors and executive officers of the General
Partner is set forth below.
<TABLE>
<CAPTION>
Name Age Positions with the General Partner
---- --- ----------------------------------
<S> <C> <C>
Glenn R. Jones 65 Chairman of the Board and Chief Executive Officer
Derek H. Burney 55 Vice Chairman of the Board
James B. O'Brien 45 President, Chief Operating Officer and Director
Ruth E. Warren 45 Group Vice President/Operations
Kevin P. Coyle 43 Group Vice President/Finance
Christopher J. Bowick 40 Group Vice President/Technology
Timothy J. Burke 44 Group Vice President/Taxation/Administration
Raymond L. Vigil 48 Group Vice President/Human Resources and Director
Cynthia A. Winning 43 Group Vice President/Marketing
Elizabeth M. Steele 43 Vice President/General Counsel/Secretary
Larry W. Kaschinske 35 Controller
James J. Krejci 53 Director
Christine Jones Marocco 39 Director
Daniel E. Somers 47 Director
Robert S. Zinn 58 Director
David K. Zonker 41 Director
</TABLE>
Mr. Glenn R. Jones has served as Chairman of the Board of Directors
and Chief Executive Officer of the General Partner since its formation in 1970,
and he was President from June 1984 until April 1988. Mr. Jones was elected a
member of the Executive Committee of the Board of Directors in April 1985. Mr.
Jones is the sole shareholder, President and Chairman of the Board of Directors
of Jones International, Ltd. He is also Chairman of the Board of Directors of
the subsidiaries of the General Partner and of certain other affiliates of the
General Partner. Mr. Jones has been involved in the cable television business
in various capacities since 1961, is a past and present member of the Board of
Directors of the National Cable Television Association, and is a former member
of its Executive Committee. Mr. Jones is a past director and member of the
Executive Committee of C-Span. Mr. Jones has been the recipient of several
awards including the Grand Tam Award in 1989, the highest award from the Cable
Television Administration and Marketing Society; the Chairman's Award from the
Investment Partnership Association, which is an association of sponsors of
public syndications; the cable television industry's Public Affairs Association
President's Award in 1990, the Donald G. McGannon award for the advancement of
minorities and women in cable; the STAR Award from American Women in Radio and
Television, Inc. for exhibition of a commitment to the issues and concerns of
women in television and radio; and the Women in Cable Accolade in 1990 in
recognition of support of this organization. Mr. Jones is also a founding
member of the James Madison Council of the Library of Congress and is on the
Board of Governors of the American Society of Training and Development.
Mr. Derek H. Burney was appointed a Director of the General Partner in
December 1994 and Vice Chairman of the Board of Directors in January 1995. He
is also a member of the Executive Committee of the Board of Directors. Mr.
Burney joined BCE Inc., Canada's largest telecommunications company, in January
1993 as Executive Vice President, International. He has been the Chairman of
Bell Canada International Inc., a
27
<PAGE> 28
subsidiary of BCE, since January 1993 and, in addition, has been Chief
Executive Officer of BCI since July 1993. Prior to joining BCE, Mr. Burney
served as Canada's ambassador to the United States from 1989 to 1992. Mr.
Burney also served as chief of staff to the Prime Minister of Canada from March
1987 to January 1989 where he was directly involved with the negotiation of the
U.S. - Canada Free Trade Agreement. In July 1993, he was named an Officer of
the Order of Canada. Mr. Burney is chairman of Bell Cablemedia plc. He is a
director of Mercury Communications Limited, Videotron Holdings plc, Tele-Direct
(Publications) Inc., Teleglobe Inc., Bimcor Inc., Maritime Telegraph and
Telephone Company, Limited, Moore Corporation Limited and Northbridge
Programming Inc.
Mr. James B. O'Brien, the General Partner's President, joined the
General Partner in January 1982. Prior to being elected President and a
Director of the General Partner in December 1989, Mr. O'Brien served as a
Division Manager, Director of Operations Planning/Assistant to the CEO, Fund
Vice President and Group Vice President/Operations. Mr. O'Brien was appointed
to the General Partner's Executive Committee in August 1993. As President, he
is responsible for the day-to-day operations of the cable television systems
managed and owned by the General Partner. Mr. O'Brien is also President and a
Director of Jones Cable Group, Ltd., Jones Global Funds, Inc. and Jones Global
Management, Inc., all affiliates of the General Partner. Mr. O'Brien is a
board member of Cable Labs, Inc., the research arm of the U.S. cable
television industry. He also serves as a director of the Cable Television
Administration and Marketing Association and as a director of the Walter Kaitz
Foundation, a foundation that places people of any ethnic minority group in
positions with cable television systems, networks and vendor companies.
Ms. Ruth E. Warren joined the General Partner in August 1980 and has
served in various operational capacities, including system manager and Fund
Vice President, since then. Ms. Warren was elected Group Vice
President/Operations of the General Partner in September 1990.
Mr. Kevin P. Coyle joined The Jones Group, Ltd. in July 1981 as Vice
President/Financial Services. In September 1985, he was appointed Senior Vice
President/Financial Services. He was elected Treasurer of the General Partner
in August 1987, Vice President/Treasurer in April 1988 and Group Vice
President/Finance and Chief Financial Officer in October 1990.
Mr. Christopher J. Bowick joined the General Partner in September 1991
as Group Vice President/Technology and Chief Technical Officer. Previous to
joining the General Partner, Mr. Bowick worked for Scientific Atlanta's
Transmission Systems Business Division in various technical management
capacities since 1981, and as Vice President of Engineering since 1989.
Mr. Timothy J. Burke joined the General Partner in August 1982 as
corporate tax manager, was elected Vice President/Taxation in November 1986 and
Group Vice President/Taxation/Administration in October 1990.
Mr. Raymond L. Vigil joined the General Partner in June 1993 as Group
Vice President/Human Resources. Previous to joining the General Partner, Mr.
Vigil served as Executive Director of Learning with USWest. Prior to USWest,
Mr. Vigil worked in various human resources posts over a 14-year term with the
IBM Corporation.
Ms. Cynthia A. Winning joined the General Partner as Group Vice
President/Marketing in December 1994. Previous to joining the General Partner,
Ms. Winning served since 1994 as the President of PRS Inc., Denver, Colorado, a
sports and event marketing company. From 1979 to 1981 and from 1986 to 1994,
Ms. Winning served as the Vice President and Director of Marketing for Citicorp
Retail Services, Inc., a provider of private-label credit cards for ten
national retail department store chains. From 1981 to 1986, Ms. Winning was
the Director of Marketing Services for Daniels & Associates cable television
operations, as well as the Western Division Marketing Director for Capital
Cities Cable. Ms. Winning also serves as a board Member of Cities in Schools,
a dropout intervention/prevention program.
28
<PAGE> 29
Ms. Elizabeth M. Steele joined the General Partner in August 1987 as
Vice President/General Counsel and Secretary. From August 1980 until joining
the General Partner, Ms. Steele was an associate and then a partner at the
Denver law firm of Davis, Graham & Stubbs, which serves as counsel to the
General Partner.
Mr. Larry Kaschinske joined the General Partner in 1984 as a staff
accountant in the General Partner's former Wisconsin Division; was promoted to
Assistant Controller in 1990 and named Controller in August 1994.
Mr. James J. Krejci was President of the International Division of
International Gaming Technology International headquartered in Reno, Nevada,
until March 1995. Prior to joining IGT in May 1994, Mr. Krejci was Group Vice
President of Jones International, Ltd. and a Group Vice President of the
General Partner. Prior to May 1994, he also served as Group Vice President of
Jones Futurex, Inc., an affiliate of the General Partner engaged in
manufacturing and marketing data encryption devices, Jones Interactive, Inc., a
subsidiary of Jones International, Ltd. providing computer data and billing
processing facilities and Jones Lightwave, Ltd., a company owned by Jones
International, Ltd. and Mr. Jones, which is engaged in the provision of
telecommunications services. Mr. Krejci has been a Director of the General
Partner since August 1987.
Ms. Christine Jones Marocco was appointed a Director of the General
Partner in December 1994. She is the daughter of Glenn R. Jones. Ms. Marocco
is also a director of Jones International, Ltd.
Mr. Daniel E. Somers was appointed a Director of the General Partner
in December 1994 and also serves on the General Partner's Audit Committee.
From January 1992 to January 1995, Mr. Somers worked as Senior Vice President
and Chief Financial Officer of Bell Canada International Inc. and was appointed
Executive Vice President and Chief Financial Officer on February 1, 1995. He
is also a Director of certain of its affiliates. Prior to joining Bell Canada
International Inc. and since January 1989, Mr. Somers was the President and
Chief Executive Officer of Radio Atlantic Holdings Limited. Mr. Somers is a
member of the North American Society of Corporate Planning, the Financial
Executives Institution and the Financial Analysts Federation.
Mr. Robert S. Zinn was appointed a Director of the General Partner in
December 1994. Mr. Zinn joined the General Partner in January 1991 and is a
member of its Legal Department. He is also Vice President/Legal Affairs of
Jones International, Ltd. Prior to joining the General Partner, Mr. Zinn was
in private law practice in Denver, Colorado for over 25 years.
Mr. David K. Zonker was appointed a Director of the General Partner in
December 1994. Mr. Zonker has been the President of Jones International
Securities, Ltd., a subsidiary of Jones International, Ltd. since January 1984
and he has been its Chief Executive Officer since January 1988. From October
1980 until joining Jones International Securities, Ltd. in January 1984, Mr.
Zonker was employed by the General Partner. Mr. Zonker is a member of the
Board of Directors of various affiliates of the General Partner, including
Jones International Securities, Ltd. Mr. Zonker is licensed by the National
Association of Securities Dealers, Inc. and he is a past chairman of the
Investment Program Association, a trade organization based in Washington, D.C.
that promotes direct investments. He is a member of the Board of Trustees of
Graceland College, Lamoni, Iowa; the International Association of Financial
Planners and the American and Colorado Institutes of Certified Public
Accountants.
ITEM 11. EXECUTIVE COMPENSATION
The Partnership has no employees; however, various personnel are
required to operate the cable television systems owned by the Partnership.
Such personnel are employed by the General Partner and, pursuant to the terms
of the limited partnership agreement of the Partnership, the cost of such
employment is charged by the General Partner to the Partnership as a direct
reimbursement item. See Item 13.
29
<PAGE> 30
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGERS
No person or entity owns more than 5 percent of the limited
partnership interests of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The General Partner and its affiliates engage in certain transactions
with the Partnership as contemplated by the limited partnership agreement of
the Partnership. The General Partner believes that the terms of such
transactions are generally as favorable as could be obtained by the Partnership
from unaffiliated parties. This determination has been made by the General
Partner in good faith, but none of the terms were or will be negotiated at
arm's-length and there can be no assurance that the terms of such transactions
have been or will be as favorable as those that could have been obtained by the
Partnership from unaffiliated parties.
The General Partner charges the Partnership a management fee, and the
Partnership reimburses the General Partner for certain allocated overhead and
administrative expenses in accordance with the terms of the limited partnership
agreement of the Partnership. These expenses consist primarily of salaries and
benefits paid to corporate personnel, rent, data processing services and other
facilities costs. Such personnel provide engineering, marketing,
administrative, accounting, legal and investor relations services to the
Partnership. Allocations of personnel costs are based primarily on actual time
spent by employees of the General Partner with respect to the Partnership
managed. Remaining overhead costs are allocated based on revenues and/or the
costs of assets managed for the Partnership. Systems owned by the General
Partner and all other systems owned by partnerships for which Jones Intercable,
Inc. is the general partner, are also allocated a proportionate share of these
expenses.
The General Partner also advances funds and charges interest on the
balance payable from the Partnership. The interest rate charged the
Partnership approximates the General Partner's weighted average cost of
borrowing.
The Systems receive stereo audio programming from Superaudio, a joint
venture owned 50% by an affiliate of the General Partner and 50% by an
unaffiliated party, educational video programming from Mind Extension
University, Inc., an affiliate of the General Partner, and computer video
programming from Jones Computer Network, Ltd., an affiliate of the General
Partner, for fees based upon the number of subscribers receiving the
programming.
Product Information Network ("PIN"), an affiliate of the General
Partner, provides advertising time for third parties on the Systems. In
consideration, the revenues generated from the third parties are shared
two-thirds and one-third between PIN and the Partnership. During the year
ended December 31, 1994, the Partnership received revenues from PIN of $2,403.
The charges to the Partnership for related party transactions are as
follows for the periods indicated:
<TABLE>
<CAPTION>
Jones Cable Income Fund 1-A, Ltd. At December 31,
- --------------------------------- -------------------------------------------------------------
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Management fees $ 214,713 $ 205,568 $ 192,781
Allocation of expenses 353,698 304,675 286,857
Interest expense 11,769 5,838 15,161
Amount of notes and advances outstanding 483,487 20,529 19,356
Highest amount of notes and advances outstanding 483,487 20,529 277,172
Programming fees:
Superaudio 7,598 7,488 7,467
Mind Extension University 6,885 4,363 4,279
Jones Computer Network 1,611 -0- -0-
</TABLE>
30
<PAGE> 31
PART IV.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a)1. See index to financial statements for a list
of financial statements and exhibits thereto filed
as a part of this report.
3. The following exhibits are filed herewith:
4.1 Limited Partnership Agreement of Jones Cable Income
Fund 1-A, Ltd. (1)
10.1.1 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the City of Glencoe, Minnesota. (1)
10.1.2 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the Township of Glencoe, Minnesota.
(2)
10.1.3 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the City of Owatonna, Minnesota. (1)
10.1.4 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the Township of Owatonna, Minnesota.
(2)
10.1.5 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the City of Milwaukie, Oregon. (1)
10.2.1 Revolving Credit and Term Loan Agreement dated
9/28/92 between Jones Cable Income Fund 1-A, Ltd.
and Colorado National Bank. (2)
27 Financial Data Schedule
(b) Reports on Form 8-K
None.
____________
(1) Incorporated by reference from Registrant's
Report on Form 10-K for the fiscal year ended
December 31, 1986.
(2) Incorporated by reference from Registrant's
Report on Form 10-K for the fiscal year ended
December 31, 1992.
31
<PAGE> 32
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
JONES CABLE INCOME FUND 1-A, LTD.
a Colorado limited partnership
By: Jones Intercable, Inc.
By: /s/ Glenn R. Jones
--------------------------------------
Glenn R. Jones
Chairman of the Board and Chief
Dated: March 27, 1995 Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
By: /s/ Glenn R. Jones
--------------------------------------
Glenn R. Jones
Chairman of the Board and Chief
Executive Officer
Dated: March 27, 1995 (Principal Executive Officer)
By: /s/ Kevin P. Coyle
--------------------------------------
Kevin P. Coyle
Group Vice President/Finance
Dated: March 27, 1995 (Principal Financial Officer)
By: /s/ Larry Kaschinske
--------------------------------------
Larry Kaschinske
Controller
Dated: March 27, 1995 (Principal Accounting Officer)
By: /s/ James B. O'Brien
--------------------------------------
James B. O'Brien
Dated: March 27, 1995 President and Director
By: /s/ Raymond L. Vigil
--------------------------------------
Raymond L. Vigil
Dated: March 27, 1995 Group Vice President and Director
By: /s/ Robert S. Zinn
--------------------------------------
Robert S. Zinn
Dated: March 27, 1995 Director
32
<PAGE> 33
By: /s/ David K. Zonker
--------------------------------------
David K. Zonker
Dated: March 27, 1995 Director
By:
--------------------------------------
Derek H. Burney
Dated: Director
By:
--------------------------------------
James J. Krejci
Dated: Director
By:
--------------------------------------
Christine Jones Marocco
Dated: Director
By:
--------------------------------------
Daniel E. Somers
Dated: Director
33
<PAGE> 34
INDEX TO EXHIBITS
EXHIBIT DESCRIPTION
------- -----------
4.1 Limited Partnership Agreement of Jones Cable Income
Fund 1-A, Ltd. (1)
10.1.1 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the City of Glencoe, Minnesota. (1)
10.1.2 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the Township of Glencoe, Minnesota.
(2)
10.1.3 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the City of Owatonna, Minnesota. (1)
10.1.4 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the Township of Owatonna, Minnesota.
(2)
10.1.5 Copy of a franchise and related documents
thereto granting a community antenna television
franchise for the City of Milwaukie, Oregon. (1)
10.2.1 Revolving Credit and Term Loan Agreement dated
9/28/92 between Jones Cable Income Fund 1-A, Ltd.
and Colorado National Bank. (2)
27 Financial Data Schedule
____________
(1) Incorporated by reference from Registrant's
Report on Form 10-K for the fiscal year ended
December 31, 1986.
(2) Incorporated by reference from Registrant's
Report on Form 10-K for the fiscal year ended
December 31, 1992.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<CASH> 78,286
<SECURITIES> 0
<RECEIVABLES> 70,273
<ALLOWANCES> (748)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 9,561,181
<DEPRECIATION> (5,291,706)
<TOTAL-ASSETS> 4,755,245
<CURRENT-LIABILITIES> 1,043,068
<BONDS> 3,584,706
<COMMON> 0
0
0
<OTHER-SE> 127,471
<TOTAL-LIABILITY-AND-EQUITY> 4,755,245
<SALES> 0
<TOTAL-REVENUES> 4,294,257
<CGS> 0
<TOTAL-COSTS> 3,994,855
<OTHER-EXPENSES> (8,476)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 214,033
<INCOME-PRETAX> 93,845
<INCOME-TAX> 0
<INCOME-CONTINUING> 93,845
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 93,845
<EPS-PRIMARY> 5.47
<EPS-DILUTED> 5.47
</TABLE>
