UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
(X) Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Quarterly Period Ended:
MARCH 31, 2000
OR
( ) Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Transition Period from ________ to ________.
Commission File Number 0-24792
NTL (TRIANGLE) LLC
(Exact name of registrant as specified in its charter)
Delaware 13-4086747
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
110 East 59th Street
New York, NY 10022
(212) 906-8440
- --------------------------------------------------------------------------------
(Address, including zip code, and telephone number, including area code,
of Registrant's principal executive offices)
--------------------------
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 twelve months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such requirements
for the past 90 days.
Yes X No
--- ---
--------------------------
As of March 31, 2000, there were 800,000 shares of the Registrant's common
membership interests outstanding. The Registrant is an indirect, wholly owned
subsidiary of NTL Incorporated and there is no market for the Registrant's
Common Stock.
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31,2000
TABLE OF CONTENTS
Page
Number
PART I. FINANCIAL INFORMATION
- ------ ---------------------
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of
March 31, 2000 (Unaudited) and December 31, 1999..............2
Condensed Consolidated Statements of Operations
for the Three Months Ended March 31, 2000 and
1999 (Unaudited)..............................................3
Condensed Consolidated Statement of Shareholder's
Equity for the Three Months Ended March 31,
2000 (Unaudited)..............................................4
Condensed Consolidated Statements of Cash Flows for
the Three Months Ended March 31, 2000 and 1999
(Unaudited)...................................................5
Notes to Condensed Consolidated
Financial Statements (Unaudited)..........................6 - 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations............9 - 11
Item 3. Quantitative and Qualitative Disclosures About
Market Risk..................................................12
PART II.OTHER INFORMATION
- ------- -----------------
Item 6. Exhibits and Reports on Form 8-K.............................12
SIGNATURE............................................................13
EXHIBIT INDEX........................................................14
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
PART I. FINANCIAL INFORMATION
- ------- ---------------------
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
CONDENSED CONSOLIDATED BALANCE SHEETS
-------------------------------------
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
----------------- -----------------
(Unaudited) (See Note)
(in (UK Pound)000's, except share data)
<S> <C> <C>
Assets
- ------
Current assets
Cash and cash equivalents .................................................... (UK Pound)28,050 (UK Pound)27,895
Marketable securities ........................................................ 1,365 --
Accounts receivable, less allowance for doubtful accounts of
(UK Pound)9,874 (2000) and (UK Pound)9,452 (1999) .......................... 11,293 10,170
Other current assets ......................................................... 5,779 4,240
----------------- -----------------
Total current assets ..................................................... 46,487 42,305
Property and equipment, net ..................................................... 386,691 382,078
Intangible assets, net .......................................................... 424,101 434,333
Other assets, net ............................................................... 37,668 42,553
----------------- -----------------
(UK Pound)894,947 (UK Pound)901,269
================= =================
Liabilities and shareholder's equity
- ------------------------------------
Current liabilities
Accounts payable and accrued expenses ........................................ (UK Pound)31,223 (UK Pound)34,431
Deferred revenue ............................................................. 11,163 10,572
Due to affiliates ............................................................ 10,156 5,905
Current portion of long-term debt ............................................ 1,127 864
----------------- -----------------
Total current liabilities .................................................. 53,669 51,772
Long-term debt, less current portion ............................................ 306,713 293,285
Commitments and contingent liabilities
Deferred income taxes ........................................................... 8,037 8,237
Shareholder's equity:
Common membership interests, (UK Pound).01 par value - authorized and
issued 800,000 shares ...................................................... 8 8
Additional capital ........................................................... 363,966 363,966
Accumulated other comprehensive (loss) ....................................... (835) (189)
Retained earnings ............................................................ 163,389 184,190
----------------- -----------------
Total shareholder's equity ................................................. 526,528 547,975
----------------- -----------------
(UK Pound)894,947 (UK Pound)901,269
================= =================
<FN>
Note: The balance sheet at December 31, 1999 has been derived from the audited financial statements at that date.
See accompanying notes.
</FN>
</TABLE>
2
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
-----------------------------------------------
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
2000 1999
----------------- -----------------
(in (UK Pound)000's)
<S> <C> <C>
Revenue
Service income........................................................... (UK Pound)38,677 (UK Pound)23,189
----------------- -----------------
Costs and expenses
Operating................................................................ 13,507 7,773
Selling, general and administrative...................................... 14,902 10,169
Depreciation and amortization............................................ 16,753 8,750
----------------- -----------------
45,162 26,692
----------------- -----------------
Operating loss.............................................................. (6,485) (3,503)
Other income (expense)
Interest expense......................................................... (8,137) (7,646)
Investment income........................................................ 331 1,704
Equity in net loss of affiliate.......................................... - (2,060)
Amalgamation costs....................................................... - (145)
Exchange losses and other................................................ (6,656) (7,725)
----------------- -----------------
(14,462) (15,872)
----------------- -----------------
Loss before income taxes.................................................... (20,947) (19,375)
Income tax benefit.......................................................... 146 -
----------------- -----------------
Net loss.................................................................... (UK Pound)(20,801) (UK Pound)(19,375)
================= =================
</TABLE>
See accompanying notes.
3
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDER'S EQUITY
--------------------------------------------------------
(Unaudited)
(in (UK Pound)000's)
<TABLE>
<CAPTION>
Common
Membership Compre-
Interests Additional hensive
Shares Amount Capital Loss
------ ------ ------- ----
<S> <C> <C> <C> <C>
Balance at December 31, 1999 800 (UK Pound)8 (UK Pound)363,966
Net loss.................. (UK Pound)(20,801)
Currency translation
adjustment.............. (646)
-----------------
Comprehensive loss........ (UK Pound)(21,447)
----- ----------- ----------------- -----------------
Balance at March 31, 2000... 800 (UK Pound)8 (UK Pound)363,966
===== =========== =================
</TABLE>
<TABLE>
<CAPTION>
Accumulated
Other Compre-
hensive Retained
Loss Earnings Total
---- -------- -----
<S> <C> <C> <C>
Balance at December 31, 1999 (UK Pound)(189) (UK Pound)184,190 (UK Pound)547,975
Net loss.................. (20,801) (20,801)
Currency translation
adjustment.............. (646) (646)
Comprehensive loss........
-------------- ----------------- -----------------
Balance at March 31, 2000... (UK Pound)(835) (UK Pound)163,389 (UK Pound)526,528
============== ================= =================
</TABLE>
See accompanying notes.
4
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
2000 1999
---------------- ----------------
(in (UK Pound)000's)
<S> <C> <C>
Net cash provided by (used in) operating activities...................... (UK Pound)10,151 (UK Pound)(189)
---------------- ----------------
Investing activities
Purchases of marketable securities.................................... (1,365) -
Fixed asset deposit with affiliate.................................... - (51,915)
Capital expenditures.................................................. (8,079) (12,141)
Additions to deferred charges......................................... - (52)
---------------- ----------------
Net cash used in investing activities........................... (9,444) (64,108)
---------------- ----------------
Financing activities
Principal payments.................................................... (465) (754)
Net transactions with affiliates...................................... - (60)
---------------- ----------------
Net cash used in financing activities........................... (465) (814)
Effect of exchange rate changes on cash......................... (87) -
---------------- ----------------
Increase (decrease) in cash and cash equivalents......................... 155 (65,111)
Cash and cash equivalents, beginning of period........................... 27,895 103,451
---------------- ----------------
Cash and cash equivalents, end of period................................. (UK Pound)28,050 (UK Pound)38,340
================ ================
Supplemental disclosure of cash flow information
Cash paid during the period for interest.............................. (UK Pound)53 (UK Pound)233
Supplemental schedule of noncash financing activities
Capital lease obligations............................................. (UK Pound) - (UK Pound)138
</TABLE>
See accompanying notes.
5
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of
NTL (Triangle) LLC (formerly NTL (Bermuda) Limited) (the "Company") have
been prepared in accordance with U.S. generally accepted accounting
principles for interim financial information and with the instructions to
Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three months ended March 31, 2000 are not necessarily
indicative of the results that may be expected for the year ending December
31, 2000. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Company's Annual Report on
Form 10-K for the year ended December 31, 1999.
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This statement, which establishes
accounting and reporting standards for derivatives and hedging activities,
is required to be adopted by the Company effective January 1, 2001. Upon
the adoption of SFAS No. 133, all derivative instruments are required to be
recognized in the statement of financial position as either assets or
liabilities and measured at fair value. The Company is evaluating the
impact that the adoption of SFAS No. 133 will have on its financial
position and results of operations.
2. Comprehensive Loss
Comprehensive loss for the three-month periods ended March 31, 2000 and
1999 was (UK Pound)21,447,000 and (UK Pound)19,375,000, respectively.
3. Amalgamation with NTL
On October 29, 1998, NTL Incorporated ("NTL"), NTL (Bermuda) Limited, a
wholly owned subsidiary of NTL, and Comcast UK Cable Partners Limited
("Partners") consummated a transaction (the "Amalgamation"), whereby NTL
(Bermuda) Limited merged with Partners.
Pursuant to then existing arrangements between Partners and Telewest
Communications plc ("Telewest"), a co-owner of interests in Cable London
PLC ("Cable London") and Birmingham Cable Corporation Limited ("Birmingham
Cable"), Telewest had certain rights to acquire either or both of Partner's
interests in these systems as a result of the Amalgamation. On August 14,
1998, Partners and NTL entered into an agreement (the "Telewest Agreement")
with Telewest relating to Partner's ownership interests in Birmingham
Cable, Partner's and Telewest's respective ownership interests in Cable
London and certain other related matters. Pursuant to the Telewest
Agreement, in October 1998, Partners sold its 27.5% ownership interest in
Birmingham Cable to Telewest for (UK Pound)125 million, plus (UK Pound)5
million for certain subordinated debt and fees. Additionally, in November
1999, the Company sold its 50% ownership interest in Cable London to
Telewest for (UK Pound)428 million in cash.
6
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
4. Investment in Cable London
Summarized financial information for Cable London which was accounted for
under the equity method is as follows (in (UK Pound)000's):
<TABLE>
<CAPTION>
Three Months Ended
March 31, 1999
------------------
<S> <C>
Results of operations:
Service income.......................................................... (UK Pound)18,992
Operating, selling, general and administrative expenses................. (13,579)
Depreciation and amortization........................................... (5,904)
Operating loss.......................................................... (491)
Net loss................................................................ (4,023)
Company's equity in net loss............................................ (2,060)
</TABLE>
5. Property and Equipment
Property and equipment consists of (in (UK Pound)000's):
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
----------------- -----------------
(Unaudited)
<S> <C> <C>
Operating equipment............................................... (UK Pound)422,488 (UK Pound)414,276
Other equipment................................................... 62,470 61,364
Construction in progress.......................................... 5,945 4,358
----------------- -----------------
490,903 479,998
Accumulated depreciation.......................................... (104,212) (97,920)
----------------- -----------------
(UK Pound)386,691 (UK Pound)382,078
================= =================
</TABLE>
6. Intangible Assets
Intangible assets consist of (in (UK Pound)000's):
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
----------------- -----------------
(Unaudited)
<S> <C> <C>
Goodwill, net of accumulated amortization of
(UK Pound)17,693 (2000) and (UK Pound)11,928 (1999)............ (UK Pound)328,206 (UK Pound)333,971
License acquisition costs, net of accumulated amortization
of (UK Pound)5,410 (2000) and (UK Pound)3,607 (1999)........... 30,658 32,461
Customer lists, net of accumulated amortization of
(UK Pound)3,232 (2000) and (UK Pound)1,616 (1999).............. 29,090 30,706
Other, net of accumulated amortization of (UK Pound)22,216 (2000)
(UK Pound)21,168 (1999)........................................ 36,147 37,195
----------------- -----------------
(UK Pound)424,101 (UK Pound)434,333
================= =================
</TABLE>
7
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED
(Unaudited)
In July 1999, NTL Communications Corp., a wholly-owned subsidiary of NTL,
acquired Cablelink Limited ("Cablelink") for IR(Pound)535.18 million ((UK
Pound)409.8 million). NTL Communications Corp. accounted for the
acquisition as a purchase. In December 1999, the Company acquired Cablelink
from NTL Communications Corp. for (UK Pound)423.6 million in cash. The
Company accounted for the acquisition at historical cost in a manner
consistent with a transfer of entities under common control, which is
similar to that used in a "pooling of interests." Accordingly, the net
assets and results of operations of Cablelink have been included in the
consolidated financial statements from July 1999.
The pro forma unaudited consolidated results of operations for the three
months ended March 31, 1999 assuming the consummation of the above
mentioned transaction as of January 1, 1999 is as follows (in (UK
Pound)000's):
Total revenue........................................(UK Pound)34,706
Net loss............................................. (27,090)
7. Joint Purchasing Alliance Agreement
Other assets includes a deposit of (UK Pound)35.9 million which will be
utilized under a Joint Purchasing Alliance Agreement entered into between
subsidiaries of the Company and Diamond Cable Communications plc, a
subsidiary of NTL, for combined fixed asset purchases. The Company's
original deposit was (UK Pound)51.9 million in March 1999.
8. Related Party Transactions
Since the Amalgamation, a subsidiary of NTL Communications Corp. has been
providing management, financial, legal and technical services to the
Company. Beginning in the fourth quarter of 1999, this subsidiary began
charging the Company for these services using an allocation formula based
on customers. The Company was charged (UK Pound)2.8 million for the three
months ended March 31, 2000, which is included in selling, general and
administrative expenses and in the due to affiliates balance. It is not
practicable to determine the amounts of these expenses that would have been
incurred had the Company operated as an unaffiliated entity. In the opinion
of management of the Company, the allocation method is reasonable.
9. Contingencies
The Company is involved in legal proceedings and claims which arise in the
ordinary course of its business. In the opinion of management, the amount
of ultimate liability with respect to these actions will not materially
affect the financial position, results of operations or liquidity of the
Company.
8
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- ------ ---------------------------------------------------------------
Overview
- --------
NTL (Triangle) LLC (formerly NTL (Bermuda) Limited) (the "Company") is a holding
company which holds all of the shares of various companies principally engaged
in the development, construction, management and operation of broadband
communications networks for telephone, cable television and Internet services in
the United Kingdom ("UK") and Ireland. The Company owns the companies that have
franchises for Darlington and Teesside (collectively, "Teesside") and Cambridge
Holding Company Limited ("Cambridge") in the UK, and Cablelink Limited
("Cablelink"), which owns the companies that provide services in Dublin, Galway
and Waterford, Ireland. The Company previously owned a 50% interest in Cable
London PLC ("Cable London") which it sold in November 1999.
Liquidity and Capital Resources
- -------------------------------
In November 1995, the Company issued $517.3 million principal amount at maturity
of 11.20% Senior Discount Debentures due 2007 (the "2007 Discount Debentures").
Interest accretes on the 2007 Discount Debentures at 11.20% per annum compounded
semiannually from November 15, 1995 to November 15, 2000, after which date
interest will be paid in cash on each May 15 and November 15 through November
15, 2007. The 2007 Discount Debentures contain restrictive covenants which limit
the Company's ability to pay dividends.
The Company will require approximately (UK Pound)115.0 million from April 1,
2000 through December 31, 2000 for capital expenditures net of cash from
operations. Management believes that the entire (UK Pound)115.0 million required
will be funded through cash on hand, debt or equity from NTL or its subsidiaries
and from the Joint Purchasing Alliance Agreement deposit of (UK Pound)35.9
million. Subsidiaries of the Company and Diamond Cable Communications plc, a
subsidiary of NTL, entered into this agreement in 1999 for joint fixed asset
purchases. The Company's ability to meet its long-term liquidity and capital
requirements is contingent upon Cambridge, Teesside and Cablelink's ability to
generate positive operating cash flow, or, if necessary, to obtain external
financing, although there can be no assurance that any such financing will be
obtained on acceptable terms and conditions.
Condensed Consolidated Statements of Cash Flows
- -----------------------------------------------
Net cash provided by (used in) operating activities amounted to (UK Pound)10.2
million and (UK Pound)(189,000) for the three months ended March 31, 2000 and
1999, respectively. The increase in net cash provided by operating activities is
due to the increase in the Company's operating income before depreciation and
amortization and changes in working capital as a result of the timing of
receipts and disbursements.
Net cash used in investing activities amounted to (UK Pound)9.4 million and (UK
Pound)64.1 million for the three months ended March 31, 2000 and 1999,
respectively. During the three months ended March 31, 2000, net cash used in
investing activities includes purchases of marketable securities of (UK
Pound)1.4 million and capital expenditures of (UK Pound)8.1 million. During the
three months ended March 31, 1999, net cash used in investing activities
includes the Joint Purchasing Alliance Agreement deposit of (UK Pound)51.9
million for combined purchases of fixed assets by NTL affiliates and capital
expenditures of (UK Pound)12.1 million.
Net cash used in financing activities was (UK Pound)(465,000) and (UK
Pound)(814,000) for the three months ended March 31, 2000 and 1999,
respectively, primarily for debt principal payments.
9
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
Results of Operations
- ---------------------
In December 1999, Cablelink was acquired by the Company from NTL Communications
Corp. This transaction was accounted for at historical cost in a manner
consistent with a transfer of entities under common control, which is similar to
that used in a "pooling of interests." Accordingly, the Company consolidated the
results of operations of Cablelink from July 1999.
Summarized consolidated financial information for the Company for the three
months ended March 31, 2000 and 1999 is as follows (in thousands, "NM" denotes
percentage is not meaningful):
<TABLE>
<CAPTION>
Three Months Ended
March 31, Increase/(Decrease)
2000 1999 (UK Pound) %
---------------- ---------------- ---------------- ----------
<S> <C> <C> <C> <C>
Revenue...................................... (UK Pound)38,677 (UK Pound)23,189 (UK Pound)15,488 66.8%
Operating, selling, general and 28,409 17,942 10,467 58.3
administrative expenses......................
Depreciation and amortization................ 16,753 8,750 8,003 91.5
---------------- ----------------
Operating loss............................... (6,485) (3,503) 2,982 85.1
---------------- ----------------
Interest expense............................. (8,137) (7,646) 491 6.4
Investment income............................ 331 1,704 (1,373) (80.6)
Equity in net loss of affiliate.............. - (2,060) (2,060) NM
Amalgamation costs........................... - (145) (145) NM
Exchange losses and other.................... (6,656) (7,725) (1,069) (13.8)
---------------- ----------------
Loss before income taxes..................... (20,947) (19,375) 1,572 8.1
Income tax benefit........................... 146 - 146 NM
---------------- ----------------
Net loss..................................... (UK Pound)(20,801) (UK Pound)(19,375) (UK Pound)1,426 7.4%
================= =================
</TABLE>
Substantially all of the increases in revenues, operating expenses, selling,
general and administrative expenses and depreciation and amortization expense
for the three months ended March 31, 2000, as compared to the same period in
1999, are attributable to the effects of the acquisition of Cablelink, as well
as the continued development of the Company's operations and increased business
activity resulting from the growth in the number of subscribers in Cambridge and
Teesside. These trends in operations and business activity are expected to
continue for the foreseeable future.
Interest expense for the three months ended March 31, 2000 and 1999 was (UK
Pound)8.1 million and (UK Pound)7.7 million, respectively, representing an
increase of (UK Pound)491,000 from 1999 as compared to the same period in 2000.
The increase is primarily attributable to the compounding of interest on the
2007 Discount Debentures, partially offset by the payment of the note payable to
Comcast U.K. Holdings, Inc. in September 1999.
Investment income for the three months ended March 31, 2000 and 1999 was (UK
Pound)331,000 and (UK Pound)1.7 million, respectively, representing a decrease
of (UK Pound)1.4 million from 1999 as compared to the same period in 2000. The
decrease is primarily attributable to the termination of the loans to Cable
London in November 1999 and to decreases in the average cash balances available
for investment in 2000 as compared to the same period in 1999.
Equity in net loss of affiliate for the three months ended March 31, 1999 of (UK
Pound)2.1 million was from the Company's 50% ownership interest in Cable London.
The Company incurred costs of (UK Pound)145,000 in 1999 associated with the
amalgamation with NTL.
Exchange losses and other for the three months ended March 31, 2000 and 1999
were (UK Pound)6.7 million and (UK Pound)7.7 million, respectively, representing
a decrease of (UK Pound)1.0 million from 1999 as compared to the same period in
2000. This decrease primarily resulted from the impact of fluctuations in the
valuation of the UK Pound Sterling on the 2007 Discount
10
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
Debentures, which are denominated in US dollars. The Company's results of
operations will continue to be affected by exchange rate fluctuations.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
- --------------------------------------------------------------------------------
Certain statements contained herein constitute "forward-looking statements" as
that term is defined under the provisions of the Private Securities Litigation
Reform Act of 1995. When used herein, the words "believe," "anticipate,"
"should," "intend," "plan," "will," "expects," "estimates," "projects,"
"positioned," "strategy," and similar expressions identify such forward-looking
statements. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results, performance
or achievements of the Company, or industry results, to be materially different
from those contemplated, projected, forecasted, estimated or budgeted, whether
expressed or implied, by such forward-looking statements. Such factors include,
among others: general economic and business conditions, the Company's ability to
continue to design networks, install facilities, obtain and maintain any
required governmental licenses or approvals and finance construction and
development, all in a timely manner at reasonable costs and on satisfactory
terms and conditions, as well as assumptions about customer acceptance, churn
rates, overall market penetration and competition from providers of alternative
services, the impact of new business opportunities requiring significant
up-front investment, and availability, terms and deployment of capital.
11
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
- ------- ----------------------------------------------------------
There have not been any material changes in the reported market risks since the
end of the most recent fiscal year.
PART II. OTHER INFORMATION
- -------- -----------------
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits:
3.5 Amended and Restated Operating Agreement of NTL (Triangle)
LLC, dated as of April 3, 2000.
27 Financial Data Schedule
(b) Reports on Form 8-K:
During the quarter ended March 31, 2000, the Company filed a
Report on Form 8-K\A dated January 28, 2000 reporting under Item
2, Acquisition or Disposition of Assets, that financial
statements of the acquired business, Cablelink Limited and
unaudited pro forma financial information for the Registrant,
were filed under Item 7.
12
<PAGE>
NTL (TRIANGLE) LLC AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2000
SIGNATURES
----------
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
NTL (TRIANGLE) LLC
---------------------------------------------------
(Registrant)
By: NTL Group Limited
Its Sole Managing Member
Date: May 11, 2000 By: /s/ Leigh C. Wood
---------------------------------------------------
Leigh C. Wood
(Chairman of the Board, Director, and Principal
Executive Officer of NTL Group Ltd., the sole
managing member) on behalf of registrant
Date: May 11, 2000 By: /s/ David Kelham
---------------------------------------------------
David Kelham
(Principal Accounting and Financial Officer and
Director of NTL Group Ltd., the sole managing
member) on behalf of registrant
13
<PAGE>
EXHIBIT INDEX
2.l Reorganization Agreement, dated 19 September 1994, among
Warburg, Pincus Investors, L.P., Bankers Trust Investments PLC
("Bankers Trust"), Comcast Corporation ("Comcast"), Comcast
U.K. Holdings, Inc., ("Holdings"), the Company and UK Cable
Partners Limited ("UKCPL"). (1)
2.2 Agreement and Plan of Amalgamation dated 4 February 1998 among
NTL Incorporated, NTL (Bermuda) Limited and the Company, as
amended. (7)
2.3 Deed of Transfer, dated December 13, 1999. (9)
3(i) Memorandum of Association of the Company. (2)
3(ii) By-laws of the Company. (2)
3.1 Certificate of Formation, filed with the Delaware Secretary of
State on November 12, 1999. (8)
3.2 Certificate of Amendment, filed with the Delaware Secretary of
State on November 18, 1999. (8)
3.3 Operating Agreement of NTL (Triangle) LLC, dated as of
November 14, 1999. (8)
3.4 Corrected Certificate of Conversion, filed with the Delaware
Secretary of State on November 16, 1999. (8)
3.5 Amended and Restated Operating Agreement of NTL (Triangle)
LLC, dated as of April 3, 2000.
4.l Form of Certificate for Class A Common Shares, par value (UK
Pound)0.01 per share. (2)
4.2 Indenture dated as of 15 November 1995, between the Company
and Bank of Montreal Trust Company, as Trustee, in respect of
the Company's 11.20% Senior Discount Debentures Due 2007 (the
"2007 Debentures"). (1)
10.1 Subscription and Contribution Agreement, dated 26 October
1992, among Comcast, UKCPL, the Company, Holdings, Comcast
Cablevision of Birmingham, Inc. ("Comcast Birmingham") and
Comcast Cablevision of London, Inc. (2)
10.2 Shareholders Agreement, dated 11 December 1992 (the
"Shareholders Agreement"), among Holdings, UKCPL, the Company
and Comcast. (2)
10.3 Supplemental Agreement, dated 21 June 1995, among the Company,
Comcast Consulting, Comcast, Holdings, Warburg Pincus and UK
Consulting to the NewCo Services Agreement, the Delegation
Agreement and the Shareholders Agreement. (3)
10.4 Share Exchange Agreement, dated 4 December 1995, among
Singapore Telecom International Pte. Limited, Cambridge Cable,
the Company and Holdings. (5)
10.5 Share Exchange Agreement, dated 5 May 1994, between Avalon
Telecommunications L.L.C. and the Company. (2)
10.6 Agreement dated August 14, 1998 among Telewest Communications
plc, Telewest Communications Holding Limited, the Company and
NTL Incorporated. (6)
27 Financial Data Schedule.
99.1 Consolidated financial statements of Cambridge Holding Company
Limited (a United Kingdom corporation in the prematurity
stage) and subsidiaries as of and for the years ended December
31, 1995 and 1994. (6)
---------------
(1) Incorporated by reference to the Company's Registration Statement on
Form S-1 (File No. 33-96932) declared effective November 9, 1995.
(2) Incorporated by reference to the Company's Registration Statement on
Form S-1 (File No. 33-76160) declared effective September 20, 1994.
(3) Incorporated by reference to the Company's Quarterly Report on Form
10-Q, filed for the quarter ended June 30, 1995 (File No. 0-24792).
(4) Incorporated by reference to the Company's Quarterly Report on Form
10-Q, filed for the quarter ended March 31, 1995 (File No. 0-24792).
(5) Incorporated by reference to the Company's Current Report on Form
8-K, filed January 22, 1996.
(6) Incorporated by reference to NTL Incorporated's Current Report on
Form 8-K dated August 18, 1998. (File No. 000-22616).
(7) Incorporated by reference to NTL's Registration Statement on Form S-4
(File No. 333-64727).
(8) Incorporated by reference to the Company's Current Report on Form
8-K, filed December 9, 1999.
(9) Incorporated by reference to the Company's Current Report on Form
8-K, filed December 28, 1999.
14
AMENDED AND RESTATED OPERATING AGREEMENT
THIS AMENDED AND RESTATED OPERATING AGREEMENT (this "Amended and Restated
Agreement") of NTL (Triangle) LLC (the "Company") is dated as of this 3rd day of
April, 2000 and amends and restates the Operating Agreement (the "Agreement") of
the Company, dated as of the 14th day of November, 1999.
RECITAL
NTL Group Limited, the sole member of the Company (the "Member") pursuant
to a written consent, dated as of the date hereof and adopted in compliance with
Section 2.2(b) of the Agreement and Section 18-302(d) of the Delaware Limited
Liability Company Act and any successor statute, as amended from time to time
(the "Act") has approved the amendment and restatement of the Agreement.
ARTICLE 1
The Limited Liability Company
-----------------------------
1.1 Name. The name of the Company shall be "NTL (Triangle) LLC" and its
business shall be carried on in such name with such variations and changes as
the Board (as defined herein) shall determine or deem reasonably necessary to
comply with requirements of the jurisdictions in which the Company's operations
are conducted, have previously been conducted, or are expected to be conducted.
1.2 Business Purpose; Powers. The business purpose of the Company is to
engage in any lawful business or activity in which limited liability companies
are permitted to engage under the Act. The Company shall possess and may
exercise all the powers and privileges granted by the Act, by any other law or
by this Amended and Restated Agreement, together with any powers incidental
thereto, insofar as such powers and privileges are necessary, appropriate,
advisable, incidental or convenient to the conduct, promotion or attainment of
the business purposes or activities of the Company.
<PAGE>
1.3 Registered Office and Agent. The Company shall maintain a registered
office in the State of Delaware. The name and address of the Company's
registered agent in the State of Delaware is, Corporation Service Company, 1013
Centre Road, Wilmington, Delaware 19801. The Board or a duly authorized
committee thereof may, from time to time, change the Company's registered office
and/or registered agent and shall forthwith amend the Certificate of Formation
to reflect such change(s).
1.4 Term. Subject to the provisions of Articles 7 and 9 below, the Company
shall have perpetual existence.
1.5 Principal Place of Business. The principal place of business of the
Company shall be at NTL House, Bartley Wood Business Park, Hook, Hampshire RG24
9XA, United Kingdom, or such other location as the Board may, from time to time,
select.
1.6 Title to Company Property. Legal title to all property of the Company
shall be held, and vested and conveyed in the name and on behalf of the Company
and no real or other property of the Company shall be deemed to be owned by the
Member individually. The Common Shares (as defined herein) held by the Member
shall constitute personal property.
1.7 Business Transactions of the Member with the Company. In accordance
with Section 18-107 of the Act, the Member and/or one or more Directors (as
defined herein) may transact business with the Company and, subject to
applicable law, shall have the same rights and obligations with respect to any
such matter as a person who is not a member or director of the Company.
1.8 Fiscal Year. The fiscal year of the Company for financial statement
purposes shall end on December 31 of each year.
2
<PAGE>
ARTICLE 2
The Member
----------
2.1 The Member. The name and address of the Member is as follows:
Name Address
---- -------
NTL Group Limited NTL House
Bartley Wood Business Park
Hook, Hampshire RG24 9XA
United Kingdom
2.2 Member Meetings.
(i) Actions by the Member; Meetings. The Member may approve a matter or
take any action at a meeting or without a meeting by the written consent of the
Member pursuant to subparagraph (ii) below. Meetings of the Member may be called
at any time by the Member.
(ii) Action by Written Consent. Any action may be taken by the Member
without a meeting if authorized by the written consent of the Member. In no
instance where action is authorized by written consent of the Member will a
meeting of the Member be called or notice be given. However, a copy of the
action taken by written consent of the Member shall be filed with the records of
the Company. The management of the Member shall not execute such written consent
while outside the United Kingdom.
(iii) Place of Meetings. The Board or a duly authorized committee thereof
may designate any place within the United Kingdom as the place of meeting for
any regular meeting or for any special meeting. If no designation is made, the
place of the regular or special meeting shall be NTL House, Bartley Wood
Business Park, Hook, Hampshire RG24 9XA, United Kingdom. The management of the
Member may participate in a meeting by means of conference telephone or similar
communication equipment by means of which all persons participating in the
meeting can hear each other, and any such participation in a meeting shall
constitute presence in person of such management personnel of the Member at such
meeting. Notwithstanding the previous sentence, the management of the Member
while outside the United Kingdom shall not act in matters regarding the
management and control of the Company when participating in any meeting of the
Member by means of conference telephone.
3
<PAGE>
(iv) Notice of Meetings. Written notice stating the place, day, and hour of
the meeting and, in the case of a special meeting, the purpose for which the
meeting is called shall be delivered not less than ten (10) days nor more than
sixty (60) days before the date of the meeting, either personally, by facsimile
or by mail, by or at the direction of any Director calling the meeting to the
Member of record of Common Shares entitled to vote at such meeting.
(v) Waiver of Notice. When any notice is required to be given to the Member
under the provisions of this Amended and Restated Agreement, a waiver thereof in
writing signed by the person entitled to such notice, whether before, at, or
after the time stated therein, shall be equivalent to the giving of such notice.
Attendance of the Member at the meeting is also a wavier of notice.
2.3 Liability of the Member. All debts, obligations and liabilities of the
Company, whether arising in contract, tort or otherwise, shall be solely the
debts, obligations and liabilities of the Company, and the Member shall not be
obligated personally for any such debt, obligation or liability of the Company
solely by reason of being a member.
2.4 Admission of Members. New members shall be admitted only upon the
approval of the Member.
ARTICLE 3
The Board of Directors
----------------------
3.1 Management By Board of Directors. Subject to such matters that are
expressly required by this Amended and Restated Agreement to be submitted to a
vote of the Member, the business and affairs of the Company shall be managed by
or under the direction of a Board of Directors (the "Board"). The Board shall
have substantially similar rights, duties, obligations, and responsibilities as
enumerated in Section 141 of the Delaware General Corporation Law. The Board
shall be deemed to be a board of managers, and each director shall be deemed to
be a "manager", for purposes of the Act. Other than rights and powers expressly
reserved to the Member and authority delegated to officers of the Company in
accordance with this Amended and Restated Agreement, the Board shall have full,
independent, exclusive and complete discretion to manage and control the
business and affairs of the Company, to make all decisions affecting the
business and affairs of the Company and to take all such actions as it deems
necessary or appropriate to accomplish the purposes of the Company as set forth
herein.
4
<PAGE>
3.2 Decisions Affecting Policy or Management of the Company. The Board
shall have the ultimate authority to make decisions on matters affecting the
policy or management of the Company including, but not restricted to, the
following:
(i) structuring or financing the operations of the Company, including debt
financing, issuing capital, and approving the transfer of Common Shares;
(ii) appointing officers, revoking of such appointments, and determining
the remuneration of officers and Directors;
(iii) discussing, negotiating and finalizing any material contracts,
including the sale or acquisition of Company assets or investments, whether
intra-group or with a third party;
(iv) approving any changes in the accounts of the Company, including the
payment of distributions to the Member; and
(v) entering into new business opportunities and reevaluating current
business relationships.
3.3 Composition of the Board of Directors. The Board shall consist of no
less than two (2) individuals, the exact number to be determined from time to
time by the resolution of the Board (collectively, the "Directors"). Directors
shall be elected by the Member and shall hold office until their successors have
been duly elected and qualified, subject, however, to a Director's earlier
death, resignation, retirement, disqualification or removal from office.
3.4 Meetings of the Board.
(i) The Board shall hold meetings, both regular and special, at such times
as may be necessary for the Company's business. Regular meetings of the Board
may be held without notice at such time as shall from time to time be determined
by the Board. Special meetings of the Board may be called on one (1) days'
notice to each Director upon the written request of any one (1) Director. A
quorum for a regular or special meeting shall exist when a majority of the
Directors are participating in the meeting either in person or by conference
telephone and such Directors are located in the United Kingdom at the time of
such meeting.
5
<PAGE>
(ii) Notice of any Board meeting may be waived by any Director before, at
or after such meeting. Attendance of a Director at a meeting is also a waiver of
notice by such Director.
(iii) All meetings of the Board of Directors shall only be held in the
United Kingdom. The Board or a duly authorized committee thereof shall have the
power to designate the specific place of all meetings.
(iv) All actions of the Board shall require the affirmative vote of a
majority of the Directors who constitute the quorum.
(v) At all meetings of the Board a full and accurate record shall be kept
by the Secretary or person charged with such duties.
(vi) Meetings of the Board may be conducted in person or by means of
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other, and any such
participation in a meeting shall constitute presence in person of such Director
at such meeting. Notwithstanding the previous sentence, Directors while outside
the United Kingdom shall not act in matters regarding the management and control
of the Company when participating in any meeting of the Board by means of
conference telephone.
(vii) In accordance with Section 18-404(d) of the Act, any action required
or permitted to be taken at any meeting of the Board may be taken without a
meeting, without prior notice and without a vote if the number of Directors
having not less than the minimum number of votes that would be necessary to
authorize or take such action at a meeting of the Board or any committee thereof
consent thereto in writing. The writing or writings effectuating such written
consent must be filed with the minutes of proceedings of the Board. No Director
shall execute such written consent while outside the United Kingdom.
3.5 Power to Bind Company. No Director (acting in his capacity as such)
shall have any authority to bind the Company to any third party with respect to
any matter except pursuant to a resolution expressly authorizing such action
which resolution is duly adopted by the Board by the affirmative vote required
for such matter pursuant to this Amended and Restated Agreement.
6
<PAGE>
3.6 Vacancies. Any vacancies occurring on the Board may be filled by a
majority of the remaining Directors (even if less than a quorum) or by election
at a meeting of the Member called for that purpose. A Director chosen to fill a
vacancy shall serve the unexpired term of the Director's predecessor in office.
Any Director's position to be filled by reason of an increase in the number of
Directors shall be filled by a majority of the Directors then in office or by
election at any meeting of the Member called for that purpose. A Director chosen
to fill a position resulting from an increase in the number of Directors shall
hold, office until the Director's successor has been duly elected and qualified,
subject however, to a Director's earlier death, resignation, retirement,
disqualification or removal from office.
3.7 Resignation. Any Director may resign at any time by giving written
notice to the remaining Directors. The resignation of any Director shall take
effect upon receipt of written notice thereof or at such later time as shall be
specified in such written notice; and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective.
3.8 Removal. At a Member's meeting called expressly for that purpose, all
Directors or any lesser number may be removed, with or without cause, by the
vote of the Member.
3.9 Committees. By resolution duly adopted by the Board, the Board may
designate two or more Directors to constitute a committee of the Board. Each
committee shall conduct its business in the same manner as the Board conducts
its business pursuant to this Amended and Restated Agreement. Each committee
will present reports and other findings at the request of the Board or pursuant
to the resolution authorizing such committee.
3.10 Qualification of Directors. All members of the Board shall be persons
who are residents of the United Kingdom for all purposes (at the time of their
appointment or election and during their initial term, any extension thereof or
any subsequent term) and who have the appropriate expertise and experience in
overseeing the business and affairs of an enterprise similar to the Company.
3.11 Liability of Directors. Except as set forth in Section 3.12, no
Director shall be personally liable for the debts, obligations or liabilities of
the Company, including any such debts, obligations or liabilities arising under
a judgment, decree or order of a court and shall not be required to lend or
advance any funds to the Company.
7
<PAGE>
3.12 Fiduciary Duties. Each Director shall have the same fiduciary duties
as a member of a board of directors of a Delaware corporation. Directors shall
be personally liable to the Company or the Member for monetary damages for
breach of fiduciary duty as a Director, in cases where the Directors (i) breach
the duty of loyalty to the Company or the Member, (ii) act or omit to act not in
good faith or carry out intentional misconduct or a knowing violation of law or
(iii) conduct transactions from which the Directors derived any improper
personal benefit.
3.13 Officers and Related Persons. Subject to the terms of any employment
agreements to which the Company is a party, the Board shall have the authority
to appoint and terminate officers of the Company and retain and terminate
employees, agents and consultants of the Company and to delegate such duties to
any such officers, employees, agents and consultants as the Board deems
appropriate, including the power, acting individually or jointly, to represent
and bind the Company in all matters, in accordance with the scope of their
respective duties. All officers of the Company shall be persons who are
residents of the United Kingdom for all purposes (at the time of their
appointment and during their initial term, any extension thereof or any
subsequent term) and who have appropriate expertise and experience in managing
the business and affairs of an enterprise similar to the Company.
ARTICLE 4
Capital Structure and Contributions
-----------------------------------
4.1 Capital Structure. Subject to the terms of this Amended and Restated
Agreement, the capital structure of the Company shall consist of one class of
common membership interest (the "Common Shares"). Common Shares shall constitute
the limited liability company interests under the Act. The total number of
Common Shares which the Company shall have the authority to issue is 800,000
with a par value of Pound Sterling 0.01 per share. All Common Shares shall be
identical with each other in every respect. The Board or a duly authorized
committee thereof is expressly authorized, by resolution or resolutions, to
create and to issue, out of unissued shares, different classes, groups or series
of shares and to fix for each such class, group or series such voting powers,
full or limited or no voting powers, and such designations, preferences and
relative participating, optional or other special rights and qualifications,
limitations or restrictions as determined by the Board or a duly authorized
committee thereof.
4.2 Capital Contributions. In accordance with Section 18-502 of the Act,
the Board may not request the Member to make capital contributions to the
Company.
8
<PAGE>
ARTICLE 5
Books of Account and Distributions
----------------------------------
5.1 Books of Account. For financial, accounting and tax purposes, the books
and records of the Company shall be determined on an annual basis in accordance
with the appropriate rules utilized for United Kingdom Generally Accepted
Accounting Principles. The books of account of the Company shall be closed after
the close of each calendar year, and there shall be prepared appropriate
financial statements.
5.2 Distributions. The Board shall determine if cash is available for
distribution and the amount, if any, to be distributed to the Member, and shall
authorize and distribute on the Common Shares, the determined amount, subject to
applicable law, when, as and if such distribution is declared by the Board.
5.3 Withholding Taxes. The Company is authorized to withhold from
distributions to the Member, or with respect to allocations to the Member, and
to pay over to a foreign, federal, state or local government, any amounts
required to be withheld pursuant to the Internal Revenue Code of 1986, as
amended (the "Code"), or any provisions of any other foreign, federal, state or
local law pursuant to Section 18-1107 of the Act. Any amounts so withheld shall
be treated as having been distributed to the Member under this Article 5 for all
purposes of this Agreement, and shall be offset against the current or next
amounts otherwise distributable to the Member.
ARTICLE 6
Company Records
---------------
The Board shall cause to be maintained at a designated place in the United
Kingdom complete and accurate records of the Company's affairs, including minute
books and documents required by governing statutes. If no designation is made,
the records shall be maintained at NTL House, Bartley Wood Business Park, Hook,
Hampshire RG24 9XA, United Kingdom. The books of account shall be kept on such
method of accounting as the Board shall select. The Company's accounting period
shall be as determined by the Board.
9
<PAGE>
ARTICLE 7
Events of Dissolution
---------------------
Subject to approval by the Board, the Company shall be dissolved upon the
occurrence of any of the following events (each, an "Event of Dissolution"):
(i) The Member votes for dissolution; or
(ii) A judicial dissolution of the Company under Section 18-802 of the Act.
ARTICLE 8
Transfer of Interests in the Company
------------------------------------
Subject to approval by the Board, the Member may sell, assign, transfer,
convey, gift, exchange or otherwise dispose of any or all of its Common Shares
and, upon receipt by the Company of a written agreement by the person or
business entity to whom such Common Shares are to be transferred agreeing to be
bound by the terms of this Amended and Restated Agreement, such person shall be
admitted as a member.
ARTICLE 9
Termination
-----------
9.1 Liquidation. In the event that an Event of Dissolution shall occur,
then the Company shall be liquidated and its affairs shall be wound up. All
proceeds from such liquidation shall be distributed in accordance with the
provisions of Section 18-804 of the Act, and all Common Shares in the Company
shall be cancelled.
9.2 Final Accounting. In the event of the dissolution of the Company, prior
to any liquidation, a proper accounting shall be made to the Member from the
date of the last previous accounting to the date of dissolution.
9.3 Distribution in Kind. In accordance with Section 18-605 of the Act, all
or any portion of the Company's assets may be distributed in kind to the Member
in the event the Board determines that it is in the best interests of the
Company.
10
<PAGE>
9.4 Cancellation of Certificate. Upon the completion of the winding up of
the Company and the distribution of the Company's assets, the Company shall be
terminated and the Member shall cause the Company to execute and file a
Certificate of Cancellation in accordance with Section 18-203 of the Act.
ARTICLE 10
Exculpation and Indemnification
-------------------------------
10.1 Exculpation. Notwithstanding any other provision of this Amended and
Restated Agreement, whether express or implied, or obligation or duty at law or
in equity, none of the Member, Directors, or any officers, directors,
shareholders, consultants, employees, representatives or agents of any of the
foregoing, nor any officer, employee, representative or agent of the Company or
any of its affiliates (individually, a "Covered Person") shall be liable to the
Company or any other person for any act or omission (in relation to the Company,
this Amended and Restated Agreement, any related document or any transaction or
investment contemplated hereby or thereby) taken or omitted by a Covered Person
in the reasonable belief that such act or omission is in or is not contrary to
the best interests of the Company and is within the scope of authority granted
to such Covered Person by this Amended and Restated Agreement; provided such act
or omission does not constitute fraud, willful misconduct, bad faith or gross
negligence.
10.2 Indemnification. To the fullest extent permitted by law, the Company
shall indemnify and hold harmless each Covered Person from and against any and
all losses, claims, demands, liabilities, expenses, judgments, fines,
settlements and other amounts arising from any and all claims, demands, actions,
suits or proceedings, civil, criminal, administrative or investigative
(collectively, "Claims"), in which the Covered Person may be involved, or
threatened to be involved, as a party or otherwise, by reason of its management
of the business and affairs of the Company or which relates to or arises out of
the Company or its property, business or affairs. A Covered Person shall not be
entitled to indemnification under this Section 10.2 with respect to (i) any
Claim with respect to which such Covered Person has engaged in fraud, willful
misconduct, bad faith or gross negligence or (ii) any Claim initiated by such
Covered Person unless such Claim (or part thereof) (a) was brought to enforce
such Covered Person's rights to indemnification hereunder or (b) was authorized
or consented to by the Board prior to its initiation by the Covered Person.
Expenses incurred by a Covered Person in defending any Claim shall be paid by
the Company upon presentation to the Company of satisfactory documentation
evidencing such expenses and in advance of the final disposition of such Claim
upon receipt by the Company of an undertaking by or on behalf of such Covered
Person to repay any amounts advanced by the Company promptly, in full, if it
shall be ultimately determined that such Covered Person is not entitled to be
indemnified by the Company as authorized by this Article 10.
11
<PAGE>
10.3 Nonexclusive Remedy. The rights and remedies under this Article 10
shall not be deemed or considered exclusive of or (in any way) diminish, limit,
restrict, alter or otherwise adversely affect any other right to exculpation or
to indemnification or any other right or remedy available to any Covered Person
under this Amended and Restated Agreement, any other agreement, any vote of the
Board, any applicable law or otherwise, both with respect to acts or omissions
in an official capacity and acts or omissions in a separate capacity while
holding such official capacity.
10.4 Additional Covered Persons. The Board or a duly authorized committee
thereof may, in its sole and absolute discretion, provide the rights set forth
in this Article 10 to any employee, representative, consultant, advisor or agent
of the Company and in such case, such persons shall have all the rights and
entitlements of and be deemed to be a Covered Person as of the date determined
by the Board in its sole and absolute discretion.
10.5 Amendments. Any repeal or modification of this Article 10 by the
Member shall not adversely affect any rights of such Covered Person pursuant to
this Article 10, including the right to indemnification and to the advancement
of expenses of a Covered Person existing at the time of such repeal or
modification with respect to any acts or omissions occurring prior to such
repeal or modification.
ARTICLE 11
Amendment to Amended and Restated Agreement
-------------------------------------------
Amendments to this Amended and Restated Agreement and to the Certificate of
Formation of the Company shall be approved in writing by the Member. This
Amended and Restated Agreement may be amended at any time and from time to time.
An amendment shall become effective as of the date specified in the approval of
the Member or if none is specified as of the date of such approval or as
otherwise provided in the Act.
12
<PAGE>
ARTICLE 12
General Provisions
------------------
12.1 Signatory Authority over Bank Accounts. Only the Directors, officers,
or delegated persons under the control or direction of Directors and officers
who are residents of the United Kingdom shall have the sole signatory authority
over the Company's bank accounts.
12.2 Notices. Unless otherwise specifically provided in this Amended and
Restated Agreement, all notices and other communications required or permitted
to be given hereunder shall be in writing and shall be (i) delivered by hand,
(ii) delivered by a recognized commercial overnight delivery service, (iii)
mailed postage prepaid by first class mail in any such case directed or
addressed to the address set forth below or (iv) transmitted by facsimile to:
If to the Member, to: NTL Group Limited
Attention: Robert Mackenzie, Secretary
NTL House
Bartley Wood Business Park
Hook, Hampshire RG24 9XA
United Kingdom
Facsimile No.: 01256 752170
with a copy to: Skadden, Arps, Slate, Meagher & Flom LLP
Attention: Thomas H. Kennedy, Esq.
Four Times Square
New York, New York 10036
United States
Facsimile No.: (011) (917) 777-2526
Such notices shall be effective: (a) in the case of hand deliveries when
received; (b) in the case of a commercial overnight delivery service, on the
next business day after being placed in the possession of such delivery service,
with delivery charges prepaid; (c) in the case of mail, five (5) days after
deposit in the postal system, first class mail, postage prepaid; and (d) in the
case of facsimile notices, when electronic indication of receipt is received.
Any party may change its address and facsimile number by written notice to the
other given in accordance with this Section 12.2.
12.3 Construction Principles. As used in this Amended and Restated
Agreement words in any gender shall be deemed to include all other genders. The
singular shall be deemed to include the plural and vice versa. The captions and
article and section headings in this Amended and Restated Agreement are inserted
for convenience of reference only and are not intended to have significance for
the interpretation of or construction of the provisions of this Amended and
Restated Agreement.
13
<PAGE>
12.4 Severability. If any provision of this Amended and Restated Agreement
is held to be invalid or unenforceable for any reason, such provision shall be
ineffective to the extent of such invalidity or unenforceability; provided,
however, that the remaining provisions will continue in full force and effect
without being impaired or invalidated in any way unless such invalid or
unenforceable provision or clause shall be so significant as to materially
affect the expectations of the Member regarding this Amended and Restated
Agreement. Otherwise, any invalid or unenforceable provision shall be replaced
by the Member with a valid provision which most closely approximates the intent
and economic effect of the invalid or unenforceable provision.
12.5 Governing Law. This Amended and Restated Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware without
regard to the principles of conflicts of laws thereof.
12.6 Binding Effect. This Amended and Restated Agreement shall be binding
upon, and inure to the benefit of, the Member and any person who is properly
admitted as a member pursuant to this Amended and Restated Agreement.
12.7 Additional Documents and Acts. The Member agrees to execute and
deliver such additional documents and instruments and to perform such additional
acts (including undertakings concerning appointment of an agent for service of
process in the Island of Bermuda (solely with respect to activities that
occurred on or prior to the conversion of the Company from a limited company to
a limited liability company) and the State of Delaware, the payment of filing
and other fees, the keeping of books and records, and making publications or
periodic filings) as may be necessary or appropriate to effectuate, carry out
and perform all of the terms, provisions, and conditions of this Amended and
Restated Agreement and of the transactions contemplated hereby.
12.8 No Third-Party Beneficiary. This Amended and Restated Agreement is
made solely for the benefit of the Member and any person who is properly
admitted as a member pursuant to this Amended and Restated Agreement and no
other person shall have any rights, interests, or claims hereunder or otherwise
be entitled to any benefits under or on account of this Amended and Restated
Agreement as a third-party beneficiary or otherwise.
12.9 Limited Liability Company. The Member intends to form a limited
liability company and does not intend to form a partnership under the laws of
the State of Delaware or any other laws.
14
<PAGE>
IN WITNESS WHEREOF, the undersigned authorized representative of the Member
has duly executed and delivered this Amended and Restated Agreement for and on
behalf of the Member as of the date first above written.
NTL GROUP LIMITED
By: /s/ Robert Mackenzie
-------------------------------
Name: Robert Mackenzie
Title: Director and Secretary
15
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000919957
<NAME> NTL (TRIANGLE) LLC
<MULTIPLIER> 1,000
<CURRENCY> U.K. POUNDS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<PERIOD-START> JAN-01-2000
<EXCHANGE-RATE> 1.5934
<CASH> 28,050
<SECURITIES> 1,365
<RECEIVABLES> 21,167
<ALLOWANCES> (9,874)
<INVENTORY> 0
<CURRENT-ASSETS> 46,487
<PP&E> 490,903
<DEPRECIATION> (104,212)
<TOTAL-ASSETS> 894,947
<CURRENT-LIABILITIES> 53,669
<BONDS> 306,713
0
0
<COMMON> 8
<OTHER-SE> 526,520
<TOTAL-LIABILITY-AND-EQUITY> 894,947
<SALES> 0
<TOTAL-REVENUES> 38,677
<CGS> 0
<TOTAL-COSTS> 45,162
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,137
<INCOME-PRETAX> (20,947)
<INCOME-TAX> 146
<INCOME-CONTINUING> (20,801)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (20,801)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
