<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 11-K
/X/ ANNUAL REPORT PURSUANT TO SECTION 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 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _____ to _____
Commission file number 0-5550
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
____________________________
(Full title of the Plan)
TELE-COMMUNICATIONS, INC.
____________________________________________________
(Issuer of the securities held pursuant to the Plan)
5619 DTC Parkway
Englewood, Colorado 80111
___________________________________________
(Address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
<TABLE>
<CAPTION>
Financial Statements: Page No.
-------------------- --------
<S> <C>
Independent Auditors' Report 1
Statements of Net Assets Available
for Participant Benefits,
December 31, 1994 and 1993 2
Statements of Changes in Net Assets
Available for Participant Benefits,
Years ended December 31, 1994, 1993 and 1992 3
Notes to Financial Statements,
December 31, 1994, 1993 and 1992 4 to 7
Schedule 1 - Plan Investments 8
Schedule 2 - Reportable Transactions 9
Exhibit -
-------
23-Consent of KPMG Peat Marwick LLP
</TABLE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
members of the Plan Committee have duly caused this annual report to be signed
by the undersigned thereunto duly authorized.
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
(Name of Plan)
By /s/ Bernard W. Schotters
-------------------------------------
Bernard W. Schotters
Vice President - Finance and
Treasurer
and Member of Plan Committee
June 28, 1995
<PAGE> 3
Independent Auditors' Report
The Plan Committee
Tele-Communications, Inc.
Employee Stock Purchase Plan:
We have audited the accompanying statements of net assets available for
participant benefits of the Tele-Communications, Inc. Employee Stock Purchase
Plan as of December 31, 1994 and 1993, and the related statements of changes in
net assets available for participant benefits for each of the years in the
three-year period ended December 31, 1994. These financial statements are the
responsibility of the Plan'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 net assets available for participant benefits of the
Tele-Communications, Inc. Employee Stock Purchase Plan as of December 31, 1994
and 1993, and the changes in net assets available for participant benefits for
each of the years in the three-year period ended December 31, 1994 in conformity
with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of plan
investments and reportable transactions are presented for the purpose of
additional analysis and are not a required part of the basic financial
statements but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedules have been
subjected to the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, are fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
KPMG Peat Marwick LLP
Denver, Colorado
June 23, 1995
1
<PAGE> 4
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Statements of Net Assets Available
for Participant Benefits
December 31, 1994 and 1993
<TABLE>
<CAPTION>
Assets 1994 1993
- ------ -------- --------
<S> <C> <C>
Cash and cash equivalents $ 284,595 1,407,105
Investment in employer securities,
at market value (Tele-Communications, Inc.
common stock):
8,564,712 and 7,207,399 Class A shares,
with cost of $158,187,847 and
$118,955,783 at December 31, 1994
and 1993, respectively 186,282,486 218,023,820
Investments in marketable securities
(other than employer securities),
at market value:
Republic Pictures Corporation Class A
common stock, with cost of $29,040 at
December 31, 1993 -- 318,024
General Communication, Inc. Class A
common stock, with cost of $169,480 at
December 31, 1993 -- 624,877
General Communication, Inc. Class B
common stock, with cost of $53,244 at
December 31, 1993 -- 67,780
------------ ------------
186,567,081 220,441,606
Liabilities
- -----------
Due to broker for securities purchased 105,884 1,049,986
------------ ------------
Net assets available for participant benefits,
including $2,311,643 and $3,702,786 of
benefits payable to participants in 1994
and 1993, respectively $186,461,197 219,391,620
============ ============
</TABLE>
See accompanying notes to financial statements.
2
<PAGE> 5
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Statements of Changes in Net Assets Available
for Participant Benefits
Years ended December 31, 1994, 1993 and 1992
<TABLE>
<CAPTION>
1994 1993 1992
-------- -------- --------
<S> <C> <C> <C>
Contributions:
Employer $ 21,254,569 16,448,894 12,931,053
Employee 21,450,536 16,904,515 13,101,966
Transfers from other plans 911,970 356,950 852,494
------------ ----------- -----------
43,617,075 33,710,359 26,885,513
------------ ----------- -----------
Net investment income (loss):
Net unrealized appreciation
(depreciation) of securities:
Tele-Communications, Inc.
Class A common stock (62,681,130) 64,409,739 28,601,910
Republic Pictures
Corporation Class A
common stock 11,271 146,908 70,524
General Communication, Inc.
Class A common stock (163,708) 316,920 94,294
General Communication, Inc.
Class B common stock (3,130) (5,819) (6,184)
Realized gain on securities
transactions 537,017 -- --
Interest income 52,335 32,429 84,972
------------ ----------- -----------
(62,247,345) 64,900,177 28,845,516
------------ ----------- -----------
Total contributions and net
investment income (loss) (18,630,270) 98,610,536 55,731,029
Distributions to participants (14,300,153) (24,449,331) (19,491,529)
------------- ----------- -----------
Increase (decrease) in net assets
available for participant
benefits (32,930,423) 74,161,205 36,239,500
Net assets available
for participant benefits:
Beginning of year 219,391,620 145,230,415 108,990,915
------------- ----------- -----------
End of year $ 186,461,197 219,391,620 145,230,415
============= =========== ===========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 6
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1994, 1993 and 1992
(1) Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements have been prepared on an accrual
basis and present the net assets available for participant benefits and
the changes in those net assets.
Trust Fund Managed by The Colorado National Bank ("Trustee")
Under the terms of a trust agreement between the Trustee and the
Tele-Communications, Inc. Employee Stock Purchase Plan (the "Plan"), the
Trustee manages a trust fund on behalf of the Plan. The Trustee has been
granted discretionary authority concerning purchases and sales of
investments for the trust fund. The Trustee may invest up to 100% of the
assets of the Plan in employer securities without regard to any fiduciary
requirement to diversify Plan assets.
Cash Equivalents
The Plan considers investments with initial maturities of three months or
less to be cash equivalents.
Investments
Investments are reflected in the accompanying financial statements at
current market value. Current market value represents the closing prices
for those securities having readily available market quotations and fair
value as determined by the Trustee with respect to other securities. The
values used for Tele-Communications, Inc. ("TCI") Class A common stock
were $21.75 and $30.25 per share at December 31, 1994 and 1993,
respectively. Securities transactions are accounted for on the trade
date. Distributions are reflected at current market value and are
accounted for when shares are transferred by the Trustee to participants.
The cost basis of such shares distributed is determined using the
"first-in, first-out" method.
Income Taxes
The Plan has received a determination letter from the Internal Revenue
Service, dated February 4, 1986, which provides that the Plan is qualified
under the provisions of Section 401(a) of the Internal Revenue Code and is
exempt from Federal income taxation under Section 501 of such Code. The
Plan has also received a determination letter, dated March 6, 1989,
regarding qualification of the salary reduction provisions of the Plan
under Section 401(k) of the Internal Revenue Code. During 1994, the Plan
was amended and restated to comply with the Tax Reform Act of 1986. The
Plan has applied for a new determination letter and expects to maintain
its qualified status.
Plan Expenses
Administrative expenses of the Plan are paid by TCI. Accordingly, such
expenses are not reflected in the accompanying financial statements.
(continued)
4
<PAGE> 7
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
(2) Description of the Plan
As of January 27, 1994, TCI Communications, Inc. (formerly
Tele-Communications, Inc. or "Old TCI") and Liberty Media Corporation
("Liberty") entered into a definitive agreement to combine the two
companies (the "TCI/Liberty Merger"). The transaction was consummated on
August 4, 1994 and was structured as a tax free exchange of Class A and
Class B shares of both companies and preferred stock of Liberty for like
shares of a newly formed holding company, TCI/Liberty Holding Company. In
connection with the TCI/Liberty Merger, Old TCI changed its name to TCI
Communications, Inc. and TCI/Liberty Holding Company changed its name to
Tele-Communications, Inc. Old TCI shareholders received one share of TCI
for each of their shares. Liberty common shareholders received 0.975 of a
share of TCI for each of their common shares. Each share of Old TCI Class
A common stock held by the Plan was converted into one share of TCI Class
A common stock.
The Plan is a defined contribution plan sponsored by TCI. The Plan
enables participating employees to acquire a proprietary interest in TCI
and to receive benefits upon retirement. In addition, the Plan includes a
salary deferral feature in respect of employee contributions. At December
31, 1994, there were 12,639 participants in the Plan and 17,704 employees
were eligible to participate. Due to the December 2, 1991 merger between
TCI and United Artists Entertainment Company ("UAE"), eligible UAE
employees who remained with TCI were allowed to participate in the Plan
effective January 1, 1992. Due to the TCI/Liberty Merger, Liberty
employees were allowed to participate in the Plan effective October 1,
1994 if employees met the Plan's eligibility requirements. The one year
of service requirement could be satisfied if employees had one year of
service with Liberty. Under the terms of the Plan, employees are eligible
for participation after one year of service (if at least 21 years old and
work a minimum of 1,000 hours per year) and the normal retirement age is
65 years. Participants may contribute up to 10% of their compensation, as
defined, to the Plan. TCI (by annual resolution of the Board of
Directors) may contribute up to 100% of the participant contributions.
Forfeitures (due to participants' withdrawal prior to full vesting) are
used to reduce TCI's otherwise determined contributions. Such forfeitures
amounted to $195,967, $455,621 and $170,913 for the years ended December
31, 1994, 1993 and 1992, respectively. Participant contributions are
always fully vested. Generally, participants acquire a vested right in
TCI contributions as follows:
<TABLE>
<CAPTION>
Vesting
Years of service percentage
---------------- ----------
<S> <C>
Less than 1 0
1-2 20
2-3 30
3-4 45
4-5 60
5-6 80
6 or more 100
</TABLE>
Although TCI has not expressed an intent to terminate the Plan, it may do
so at any time. The Plan provides for full and immediate vesting of all
participant rights upon termination of the Plan.
(continued)
5
<PAGE> 8
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
During 1994 the Plan was amended and restated to comply with the Tax
Reform Act of 1986. Such restatement had no effect on participants or
financial obligations of the Plan.
(3) Other Marketable Securities
On January 30, 1985, TCI distributed all of the issued and outstanding
shares held by TCI of the capital stock of Republic Pictures Corporation,
a majority-owned subsidiary of TCI prior to the distribution, to TCI's
shareholders of record on January 14, 1985. During 1994, the Republic
Pictures Corporation shares were sold by the Plan and was discontinued
as an investment option.
In early 1987, WestMarc Communications, Inc. ("WestMarc"), an indirect
wholly-owned subsidiary of TCI, distributed all of the issued and
outstanding shares of the capital stock of General Communication, Inc.
("GCI"), a wholly-owned subsidiary of WestMarc prior to the distribution,
to WestMarc's shareholders of record on December 29, 1986. During 1994,
the GCI shares were sold by the Plan and was discontinued as an
investment option.
(4) Change in Unrealized Appreciation (Depreciation)
Unrealized appreciation (depreciation) of TCI Class A common stock for
the years ended December 31, 1994, 1993 and 1992, is calculated as
follows:
<TABLE>
<CAPTION>
1994 1993 1992
-------- -------- --------
<S> <C> <C> <C>
End of year $ 28,094,639 99,068,037 54,542,018
Change in unrealized
appreciation of
distributions 8,292,268 19,883,720 16,237,269
Less beginning of
year 99,068,037 54,542,018 42,177,377
------------ ---------- ----------
Net unrealized appreciation
(depreciation) of TCI
Class A common stock $(62,681,130) 64,409,739 28,601,910
============= ========== ==========
</TABLE>
(5) Transfers from Other Plans
TCI has certain subsidiaries that maintain separate retirement savings
plans. Participants in a subsidiary plan may elect, on a quarterly basis,
to transfer their entire account balance to the Plan. During 1994, 1993
and 1992, transfers to the Plan from such subsidiary plans aggregated
$911,970, $356,950 and $852,494, respectively.
(continued)
6
<PAGE> 9
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
(6) Reconciliation to Form 5500
The following represents a reconciliation between the Statement of Net
Assets Available for Participant Benefits included in the accompanying
financial statements and the Form 5500 at December 31, 1994:
<TABLE>
<S> <C>
Net Assets Available for Participant Benefits -
financial statements $ 186,461,197
Benefits payable to participants (2,311,643)
-------------
Net Assets Available for Participant Benefits -
Form 5500 $ 184,149,554
=============
</TABLE>
The following represents a reconciliation between distributions to
participants in the Statement of Changes in Net Assets Available for
Participant Benefits included in the accompanying financial statements and
the Form 5500 for the year ended December 31, 1994:
<TABLE>
<S> <C>
Distributions to participants -
financial statements $ 14,300,153
Reversal of prior year benefits
payable to participants (3,702,786)
Current year benefits payable
to participants 2,311,643
-------------
Distributions to participants -
Form 5500 $ 12,909,010
=============
</TABLE>
7
<PAGE> 10
Schedule 1
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Plan Investments
December 31, 1994
<TABLE>
<CAPTION>
Investment securities Shares Cost Market
- --------------------- ------ ---- ------
<S> <C> <C> <C>
Common Stock
- ------------
Tele-Communications, Inc.
Class A 8,564,712 $158,187,847 $186,282,486
============ ============
</TABLE>
See accompanying independent auditors' report.
8
<PAGE> 11
Schedule 2
TELE-COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Reportable Transactions
Years ended December 31, 1994, 1993 and 1992
<TABLE>
<CAPTION>
Purchases Sales
------------------- --------------------------------------
Realized
Shares Cost Shares Proceeds Gain
------ ---- ------ -------- --------
<S> <C> <C> <C> <C> <C>
For the year ended:
December 31, 1994:
Short-term Investment Co. 37,213,611 $ 37,213,611 38,085,953 $ 38,085,953 --
TCI Class A common stock 1,728,239 $ 39,107,516 -- -- --
December 31, 1993:
Short-term Investment Co. 32,788,180 $ 32,788,180 32,834,596 $ 32,834,596 --
TCI Class A common stock 1,394,635 $ 33,202,815 -- -- --
December 31,1992:
Short-term Investment Co. 25,698,879 $ 25,698,879 25,075,428 $ 25,075,428 --
TCI Class A common stock 1,477,866 $ 26,895,107 -- -- --
</TABLE>
See accompanying independent auditors' report.
9
<PAGE> 12
EXHIBIT INDEX
Shown below is the exhibit which is filed as a part of this Report -
23-Consent of KPMG Peat Marwick LLP
<PAGE> 1
Exhibit 23
Consent of Independent Auditors
The Plan Committee
Tele-Communications, Inc.
Employee Stock Purchase Plan:
We consent to incorporation by reference in the Registration Statement (No.
33-59058) on Form S-8 of Tele-Communications, Inc. Employee Stock Purchase Plan
of our report dated June 23, 1995, relating to the statements of net assets
available for participant benefits of the Tele-Communications, Inc. Employee
Stock Purchase Plan as of December 31, 1994 and 1993, and the related statements
of changes in net assets of the Tele-Communications, Inc. Employee Stock
Purchase Plan available for participant benefits for each of the years in the
three-year period ended December 31, 1994 and related schedules which report
appears in the December 31, 1994 annual report on Form 11-K of the
Tele-Communications, Inc. Employee Stock Purchase Plan.
KPMG Peat Marwick LLP
Denver, Colorado
June 23, 1995
