<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1999
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File No. 0-15745
AMERICAN CABLE TV INVESTORS 4, LTD.
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
State of Colorado 84-1013221
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9197 South Peoria Street
Englewood, Colorado 80112
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (720) 875-4000
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days. Yes X No
--- ---
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PART I - FINANCIAL INFORMATION
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Balance Sheets
(unaudited)
(see note 1)
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------- ------------
Assets amounts in thousands
- ------
<S> <C> <C>
Cash and cash equivalents (note 3) $7,703 7,405
Amounts due from related parties (note 4) -- 191
Funds held in escrow (note 5) 2,025 2,025
------ ------
$9,728 9,621
====== ======
Liabilities and Partners' Equity
- --------------------------------
Accrued liabilities $ 178 186
Amounts due to related parties (note 4) 19 --
------ ------
Total liabilities 197 186
------ ------
Partners' equity:
General partner 1,987 1,963
Limited partners 7,544 7,472
------ ------
Total partners' equity 9,531 9,435
------ ------
Contingency (note 5) $9,728 9,621
====== ======
</TABLE>
See accompanying notes to financial statements.
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AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Statements of Operations
(unaudited)
(see note 1)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
---------------------- ----------------------
1999 1998 1999 1998
--------- --------- --------- ---------
amounts in thousands, except unit amounts
<S> <C> <C> <C> <C>
General and administrative expenses $ (35) (80) (179) (171)
Interest income 100 106 275 307
Reversal of excess accrued liabilities -- -- -- 28
--------- --------- --------- ---------
Net earnings $ 65 26 96 164
========= ========= ========= =========
Net earnings per limited partnership
unit ("Unit") $ 0.41 0.16 0.60 1.02
========= ========= ========= =========
Limited partnership units outstanding 120,005 120,005 120,005 120,005
========= ========= ========= =========
</TABLE>
See accompanying notes to financial statements.
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<PAGE> 4
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Statement of Partners' Equity
Nine months ended September 30, 1999
(unaudited)
(see note 1)
<TABLE>
<CAPTION>
General Limited
partner partners Total
------- -------- ------
amounts in thousands
<S> <C> <C> <C>
Balance at January 1, 1999 $1,963 7,472 9,435
Net earnings 24 72 96
------ ------ ------
Balance at September 30, 1999 $1,987 7,544 9,531
====== ====== ======
</TABLE>
See accompanying notes to financial statements.
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AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Statements of Cash Flows
(unaudited)
(see note 1)
<TABLE>
<CAPTION>
Nine months ended
September 30,
-----------------
1999 1998
------- -------
amounts in thousands
(see note 3)
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 96 $ 164
Adjustment to reconcile net earnings to net cash provided by operating
activities:
Reversal of excess accrued liabilities -- (28)
Changes in operating assets and liabilities:
Net change in accrued liabilities and amounts due to/from
related parties 202 108
------- -------
Net cash provided by operating activities 298 244
------- -------
Cash flows from investing activities -- --
------- -------
Cash flows from financing activities -- --
------- -------
Net change in cash and cash equivalents 298 244
Cash and cash equivalents:
Beginning of period 7,405 7,310
------- -------
End of period $ 7,703 $ 7,554
======= =======
</TABLE>
See accompanying notes to financial statements.
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<PAGE> 6
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Notes to Financial Statements
September 30, 1999
(unaudited)
(1) Basis of Financial Statement Preparation
The accompanying unaudited financial statements include the accounts of
American Cable TV Investors 4, Ltd. ("ACT 4" or the "Partnership"). ACT
4 was formed for the purpose of acquiring, developing and operating
cable television systems. During 1995 and 1996, ACT 4 sold all of its
cable television assets. Accordingly, the Partnership is no longer
engaged in the cable television business and is currently seeking to
make a final determination of its liabilities so that liquidating
distributions can be made in connection with its dissolution. See note
5.
TCI Cablevision Associates, Inc. ("Cablevision") is the managing agent
of the Partnership and owns 100% of the common stock of a general
partner of the general partner of ACT 4. Cablevision is an indirect
majority-owned subsidiary of Tele-Communications, Inc. ("TCI").
On March 9, 1999, AT&T Corp. ("AT&T") acquired TCI in a merger (the
"AT&T Merger"). In the AT&T Merger, TCI became a subsidiary of AT&T.
Immediately prior to the AT&T Merger, TCI restructured its ownership of
certain of its subsidiaries, including the merger of its subsidiary,
TCI Communications, Inc. into TCI. The AT&T Merger has not had and is
not expected to have a material effect on the Partnership's results of
operations or financial condition.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
The accompanying financial statements are unaudited. In the opinion of
management, all adjustments (consisting only of normal recurring
accruals) have been made which are necessary to present fairly the
financial position of the Partnership as of September 30, 1999 and its
results of operations for the nine months ended September 30, 1999 and
1998. The results of operations for any interim period are not
necessarily indicative of the results for the entire year.
These financial statements should be read in conjunction with the
financial statements and related notes thereto included in ACT 4's
December 31, 1998 Annual Report on Form 10-K.
(continued)
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<PAGE> 7
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Notes to Financial Statements
(2) Allocation of Net Earnings and Net Losses
Pursuant to ACT 4's limited partnership agreement, net earnings and net
losses of ACT 4 are to be allocated 1% to the general partners and 99%
to ACT 4's limited partners ("Limited Partners") until the Limited
Partners have received cumulative distributions equal to their original
capital contributions ("Payback"). After the Limited Partners have
received distributions equal to Payback, the allocations of net
earnings and net losses shall be 25% to the general partner and 75% to
the Limited Partners. Payback occurred in 1996. Accordingly, the
Limited Partners' share of earnings for the nine month periods ended
September 30, 1999 and 1998 have been allocated using the post-Payback
percentages set forth above.
Earnings per Unit is calculated by dividing the net earnings
attributable to the Limited Partners by the number of Units outstanding
during the period.
(3) Supplemental Disclosure of Cash Flow Information
The Partnership considers investments with original maturities of three
months or less to be cash equivalents. At September 30, 1999,
$7,505,000 of the Partnership's cash and cash equivalents was invested
in money market funds.
The Partnership is exposed to credit loss in the event of
non-performance by the other parties to such financial instruments.
However, the Partnership does not anticipate non-performance by the
other parties.
(4) Transactions with Related Parties
The Partnership reimburses Cablevision for direct out-of-pocket and
indirect expenses allocable to the Partnership and for certain
personnel employed on a full- or part-time basis to perform accounting,
marketing, technical or other services. Such reimbursements amounted to
$27,000 for each of the nine month periods ended September 30, 1999 and
1998.
Amounts due from related parties bear interest at variable rates (5.0%
at December 31, 1998). Interest earned on amounts due from TCI and its
affiliates was not significant for each of the nine month periods ended
September 30, 1999 and 1998.
(continued)
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<PAGE> 8
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Notes to Financial Statements
(5) Contingency
In May 1996, Citizens Century Cable Television Venture
("Citizens-Century"), the buyer of the Partnership's cable television
system which was located in and around Chino, California (the "Chino
System"), filed a claim for a breach of warranty by ACT 4 in connection
with the sale of the Chino System. The Partnership is working with
Citizens-Century to resolve such claim. However, the Partnership is
unable to determine the ultimate cost of such claim, if any, or when
such claim will be resolved. The claim for indemnification has had and
will continue to have the effect of delaying the release of funds held
in escrow from the sale of the Chino System (the "Chino Escrow"). In
addition, any successful indemnification claim will have the effect of
reducing the amount of the Chino Escrow ultimately released to ACT 4.
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<PAGE> 9
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Notes to Financial Statements
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Material Changes in Results of Operations
The Partnership is no longer engaged in the cable television business
and is currently seeking to make a final determination of its liabilities so
that liquidating distributions can be made in connection with its dissolution.
For additional information, see note 5 to the accompanying financial statements.
The Partnership's results of operations for the three and nine month periods
ended September 30, 1999 and 1998 include (i) general and administrative ("G&A")
expenses and (ii) interest income. The Partnership's G&A expenses are primarily
comprised of costs associated with the administration of the Partnership. The
Partnership's G&A expenses decreased during the three months ended September 30,
1999 as compared to the corresponding prior year period primarily due to the
timing of certain G&A expenses. Such decrease was partially offset by additional
expenses incurred in connection with ACT 4's efforts to resolve the claim on the
Chino Escrow. The Partnership's results of operations for the nine months ended
September 30, 1998 reflect the reversal of certain amounts which were accrued in
prior periods.
Interest income decreased $32,000 during the nine month period ended
September 30, 1999, as compared to the corresponding prior year period. Such
decrease is primarily due to a decrease in the average interest rate earned on
the Partnership's interest bearing accounts.
Material Changes in Financial Condition
The Partnership anticipates that it will make liquidating distributions
in connection with its dissolution as soon as possible following the final
determination and satisfaction of the Partnership's liabilities, but not prior
to the release of funds from the Chino Escrow. In May 1996, Citizens-Century
filed a claim for a breach of warranty by ACT 4 in connection with the sale of
the Chino System. The Partnership is working with Citizens-Century to resolve
such claim. However, the Partnership is unable to determine the ultimate cost of
such claim, if any, or when such claim will be resolved. The claim for
indemnification has had and will continue to have the effect of delaying the
release of the Chino Escrow. In addition, any successful indemnification claim
will have the effect of reducing the amount of the Chino Escrow ultimately
released to ACT 4.
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<PAGE> 10
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
Notes to Financial Statements
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
(27) Financial Data Schedule
(b) Reports on Form 8-K filed during the quarter ended September 30, 1999 -
None.
II-1
<PAGE> 11
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN CABLE TV INVESTORS 4, LTD.
(A Colorado Limited Partnership)
By: IR-TCI PARTNERS IV, L.P.,
Its General Partner
By: TCI VENTURES FOUR, INC.,
A General Partner
Date: October 27, 1999 By: /s/ Ann M. Koets
---------------------------------------
Ann M. Koets
Vice President
(Chief Accounting Officer)
II-2
<PAGE> 12
EXHIBIT INDEX
The following exhibits are filed herewith or are incorporated by reference
herein (according to the number assigned to them in Item 601 of Regulation S-K)
as noted:
(27) American Cable TV Investors 4, LTD. Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 7,703
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 9,728
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 9,531
<TOTAL-LIABILITY-AND-EQUITY> 9,728
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 96
<INCOME-TAX> 0
<INCOME-CONTINUING> 96
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 96
<EPS-BASIC> .60<F1>
<EPS-DILUTED> 0
<FN>
<F1>EPS-PRIMARY REPRESENTS NET EARNINGS PER LIMITED PARTNERSHIP UNIT.
</FN>
</TABLE>
