<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No.__)*
TCI MUSIC, INC.
(Name of Issuer)
Series A Common Stock, $.01 par value
Series B Common Stock, $.01 par value
-------------------------------------
(Title of Classes of Securities)
Series A Common Stock 87229N 10 1
--------------------- -----------
(CUSIP Number)
Stephen M. Brett, Esq., Executive Vice President and General Counsel,
Tele-Communications, Inc.
Terrace Tower II, 5619 DTC Parkway, Englewood, CO 80111, (303-267-5500)
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
JULY 11, 1997
-------------
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b) (3) or (4), check the following box: [ ].
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Exhibit Index is on Page 11
<PAGE>
Series A Common Stock CUSIP No. 87229N 10 1
_______________________________________________________________________________
(1) Names of Reporting Persons S.S. or I.R.S. Identification Nos. of Above
Persons
TELE-COMMUNICATIONS, INC.
84 - 1260157
_______________________________________________________________________________
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [ ]
_______________________________________________________________________________
(3) SEC Use Only
_______________________________________________________________________________
(4) Source of Funds
OO
_______________________________________________________________________________
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
_______________________________________________________________________________
(6) Citizenship or Place of Organization
Delaware
_______________________________________________________________________________
Number of (7) Sole Voting Power 6,812,393 Shares of
Shares Bene- Series A*
ficially ____________________________________________________
Owned by (8) Shared Voting Power 0 Shares
Each Report- ____________________________________________________
ing Person (9) Sole Dispositive Power 6,812,393 Shares of
With Series A*
____________________________________________________
(10) Shared Dispositive Power 0 Shares
_______________________________________________________________________________
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
6,812,393 Shares of Series A*
_______________________________________________________________________________
(12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[ ]
_______________________________________________________________________________
(13) Percent of Class Represented by Amount in Row (11)**
Series A Common Stock 45.7%
_______________________________________________________________________________
(14) Type of Reporting Person
HC, CO
____________
* Does not include 62,500,000 shares of Series A Common Stock issuable upon
conversion of 62,500,000 shares of Series B Common Stock owned by the Reporting
Person. Such Series B Common Stock is convertible at any time at the option of
the Reporting Person. (See Item 5)
** Percentage determined without including 62,500,000 shares of Series A
Common Stock issuable upon conversion of 62,500,000 shares of Series B Common
Stock owned by the Reporting Person. Such Series B Common Stock is convertible
at any time at the option of the Reporting Person. Each share of Series B
Common Stock is entitled to 10 votes per share and each share of Series A Common
Stock is entitled to one vote per share. Accordingly, when these series of
stock are aggregated, the Reporting Person may be deemed to beneficially own
voting equity securities of the Issuer representing approximately 98.7% of the
voting power of the Issuer. (See Items 1 and 5)
2
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Amendment No. __)
Statement of
TELE-COMMUNICATIONS, INC.
Pursuant to Section 13(d) of the
Securities Exchange Act of 1934
in respect of
TCI MUSIC, INC.
(Commission File No. 333-28613)
ITEM 1. Security and Issuer
-------------------
Tele-Communications, Inc., a Delaware corporation ("TCI"), is filing
this Statement on Schedule 13D (this "Statement") with respect to the Series A
Common Stock, $.01 par value per share (the "Series A Stock"), of TCI Music,
Inc., a Delaware corporation (the "Issuer"). The Issuer's principal executive
offices are located at Terrace Tower II, 5619 DTC Parkway, Englewood, Colorado
80111-3000.
Pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), this Statement also relates to the shares of
Series A Stock issuable upon conversion of shares of the Series B Common Stock,
$.01 par value per share (the "Series B Stock" and together with the Series A
Stock, the "Common Stock"), of the Issuer. At the option of the holder, each
share of Series B Stock is convertible into one share of Series A Stock. The
shares of Series A Stock are not convertible into shares of Series B Stock. The
holders of Series A Stock and Series B Stock generally vote together as a single
class with respect to all matters voted on by the stockholders of the Issuer.
The holder of the Series B Stock is entitled to 10 votes per share and the
holders of the Series A Stock are entitled to one vote per share.
A right (the "Rights") is associated with each share of Series A Stock.
Until the Rights expire or are exercised, the Rights are evidenced by a legend
on the certificates for the shares of Series A Stock. Each Right entitles the
holder to require TCI to purchase from such holder one share of Series A Stock
for $8.00 per share, subject to certain reductions, if any, and payable at the
election of TCI, in cash, a number of shares of its Series A TCI Group Common
Stock, $1.00 par value per share, having an equivalent value, or a combination
thereof, if during the one year period beginning on July 11, 1997, the price of
the Series A Stock does not equal or exceed $8.00 per share for a period of at
least 20 consecutive trading days. If the Rights become exercisable, they will
be exercisable only during the 30-day period commencing on July 11, 1998, and
will expire and cease to exist at the end of such period unless exercised. The
Rights are not separable from the Series A Stock.
ITEM 2. Identity and Background
-----------------------
The reporting person is TCI, whose principal business address is 5619
DTC Parkway, Englewood, Colorado 80111.
3
<PAGE>
TCI, through its subsidiaries and affiliates, is principally engaged in
the construction, acquisition, ownership, and operation of cable television
systems and the provision of satellite-delivered video entertainment,
information and home shopping programming services to various video distribution
media, principally cable television systems. TCI also has investments in cable
and telecommunications operations and television programming in certain
international markets as well as investments in companies and joint ventures
involved in developing and providing programming for new television and
telecommunications technologies. TCI is a Delaware corporation and was
incorporated in 1994. TCI Communications, Inc. ("TCIC"), a majority owned
subsidiary of TCI, and its predecessors have been engaged in the cable
television business since the early 1950's. Prior to August 1994, TCI was named
TCI/Liberty Holding Company and TCIC was named Tele-Communications, Inc.
Schedule 1 attached to this Statement contains the following
information concerning each director, executive officer or controlling person of
TCI: (i) name and residence or business address, (ii) principal occupation or
employment; and (iii) the name, principal business and address of any
corporation or other organization in which such employment is conducted.
Schedule 1 is incorporated herein by reference.
To the knowledge of TCI, each of the persons named on Schedule 1 (the
"Schedule 1 Persons") is a United States citizen. During the last five years,
neither TCI nor any of the Schedule 1 Persons (to the knowledge of TCI) has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors). During the last five years, neither TCI nor any of the Schedule 1
Persons (to the knowledge of TCI) has been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and, as a result of
such proceeding, is or was subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
ITEM 3. Source and Amount of Funds or Other Consideration
-------------------------------------------------
TCI currently beneficially owns, through subsidiaries, a total of
6,812,393 shares of Series A Stock and 62,500,000 shares of Series B Stock. TCI
acquired its shares of Series A Stock and the associated Rights as a result of
the merger of DMX, Inc. ("DMX") with TCI Merger Sub, Inc., a wholly owned
subsidiary of the Issuer (the "Merger"), which became effective on July 11,
1997. At a Special Meeting of Stockholders of DMX held on July 11, 1997, the
stockholders of DMX approved and adopted an Agreement and Plan of Merger, dated
as of February 6, 1997, as amended by Amendment One to Merger Agreement dated
May 29, 1997 (the "Merger Agreement"), among DMX, TCI, the Issuer, and TCI
Merger Sub, Inc. Pursuant to the terms of the Merger Agreement, each outstanding
share of Common Stock, including the Common Stock beneficially owned by TCI, was
converted into the right to receive one quarter share of the Series A Stock, one
Right with respect to each whole share of Series A Stock and cash in lieu of
fractional shares of Series A Stock and Rights. As a result, DMX became a wholly
owned subsidiary of the Issuer and TCI became a beneficial owner of Common Stock
of the Issuer.
The foregoing summary of the Merger is qualified in its entirety by
reference to the complete terms, provisions and conditions thereof set forth in
the Prospectus of TCI, the Prospectus of TCI Music and the Proxy Statement of
DMX filed on June 12, 1997 (the "Prospectuses/Proxy Statement"), by such parties
as part of a Registration Statement on Form S-4 (No. 333-28613). The
Registration Statement and Prospectuses/Proxy Statement are incorporated herein
by reference and are so filed herewith as Exhibit A to this Statement.
For information on TCI's original acquisition of the beneficial
ownership of the shares of common stock of DMX, see the Statement on Schedule
13D, as amended, filed by TCI on DMX, Inc. (Commission File No. 0-18806)
4
<PAGE>
In connection with the Merger, TCI and the Issuer entered into a
Contribution Agreement, dated as of July 11, 1997, which required, among other
things, the Issuer to issue to TCI 62,500,000 shares of Series B Stock. Such
shares were issued in consideration for: (i) TCI transferring to the Issuer its
rights to receive revenues from the music services sold by DMX until December
31, 2006, and (ii) TCI contributing to the Issuer digital commercial tuners.
ITEM 4. Purpose of Transaction
----------------------
TCI currently holds its interest in the Issuer for investment purposes.
Neither TCI nor, to the best of its knowledge, any of its executive officers,
directors or controlling persons, have any present plans or proposals which
relate to or would result in: (i) any acquisition by any person of additional
securities of the Issuer, or any disposition of securities of the Issuer; (ii)
any extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Issuer or any of its subsidiaries; (iii) any sale or
transfer of a material amount of assets of the Issuer or any of its
subsidiaries; (iv) any change in the present board of directors or management of
the Issuer, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board; (v) any material
change in the present capitalization or dividend policy of the Issuer; (vi) any
other material change in the Issuer's business or corporate structure; (vii) any
changes in the Issuer's charter, by-laws, or other instruments corresponding
thereto or other actions which may impede the acquisition of control of the
Issuer by any person; (viii) any delisting from a national securities exchange
or any loss of authorization for quotation in an inter-dealer quotation system
of a registered national securities association of a class of securities of the
Issuer; (ix) any termination of registration pursuant to section 12(g)(4) of the
Exchange Act of a class of equity securities of the Issuer; or (x) any action
similar to any of those enumerated above.
Notwithstanding the foregoing, TCI may determine to change its
investment intent with respect to the Issuer at any time in the future. In
reaching any conclusion as to its future course of action, TCI will take into
consideration various factors, such as the Issuer's business and prospects,
other developments concerning the Issuer, other business opportunities available
to TCI, developments with respect to the business of TCI, and general economic
and stock market conditions, including, but not limited to, the market price of
the Common Stock of the Issuer. TCI reserves the right, depending on other
relevant factors, to acquire additional shares of the Common Stock of the Issuer
in open market or privately negotiated transactions, to dispose of all or a
portion of its holdings of shares of the Common Stock of the Issuer or to change
its intention with respect to any or all of the matters referred to in this
Item.
ITEM 5. Interest in Securities of the Issuer
------------------------------------
(a) TCI presently beneficially owns, through subsidiaries, 6,812,393
shares of the Series A Stock and 62,500,000 shares of the Series B Stock. The
6,812,393 shares of Series A Stock beneficially owned by TCI represent 45.7% of
the 14,896,648 shares of Series A Stock outstanding on July 11, 1997, as
reported by the Issuer in the Prospectuses/Proxy Statement and confirmed by the
Issuer on July 11, 1997. The 62,500,000 shares of Series B Stock beneficially
owned by TCI represent 100% of the 62,500,000 shares of Series B Stock
outstanding on July 11, 1997, as reported by the Issuer in the
Prospectuses/Proxy Statement and confirmed by the Issuer on July 11, 1997.
Leo J. Hindery, Jr., President and Chief Operating Officer of TCI, and
Donne F. Fisher, a Director of TCI, each have stock options granted by the
Issuer in connection with the Merger to acquire 833,334 shares of Series A
Stock, of which 166,667 shares of each such grant are exercisable. Assuming the
exercise in full of the stock options, the beneficial ownership of such shares
by each such individual would represent 5.3% of the 15,729,982 shares of the
Issuer's Series A Stock assumed to be outstanding upon such exercise. The above
denominator assumes 14,896,648 shares of Series A Stock outstanding on July
11,1997, plus the 833,334 shares issued upon exercise of the options for each
such individual.
5
<PAGE>
J. C. Sparkman, a Director of TCI, presently beneficially owns 137,500
shares of the Series A Stock, which includes a stock option granted by the
Issuer in connection with the Merger to acquire 100,000 shares of Series A Stock
of which 20,000 shares are exercisable. Mr. Sparkman's beneficial ownership of
137,500 shares of the Series A Stock represents less than 1% of the 14,896,648
shares of the Issuer's Series A Stock outstanding on July 11, 1997.
Other than Messrs. Hindery, Fisher and Sparkman, none of the Schedule 1
Persons has any interest in any securities of the Issuer.
(b) TCI has the sole power to vote or to direct the voting of the
shares of the Common Stock that TCI beneficially owns. TCI has the sole power to
dispose of, or to direct the disposition of the shares of Common Stock that TCI
beneficially owns.
To the knowledge of TCI, Messrs. Hindery, Fisher and Sparkman each have
sole power to vote or to direct the voting of the shares of the Series A Stock
that they each beneficially own. To the knowledge of TCI, Messrs. Hindery,
Fisher and Sparkman each have sole power to dispose of, or to direct the
disposition of, the shares of the Series A Stock that they each beneficially
own.
(c) Except for the securities of the Issuer issued or granted in
connection with the Merger, neither TCI nor, to the knowledge of TCI, any of the
persons described on Schedule 1, has executed transactions in the Common Stock
of the Issuer during the past sixty (60) days.
(d) There is no person that has the right to receive or the power to
direct the receipt of dividends from, or the proceeds from the sale of, the
Common Stock owned by TCI.
To the knowledge of TCI, there is no person that has the right to
receive or the power to direct the receipt of dividends from, or the proceeds
from the sale of, the Series A Stock owned by Messrs. Hindery, Fisher or
Sparkman, respectively.
(e) Not applicable.
ITEM 6. Contracts, Arrangements, Understandings or Relationships with Respect
---------------------------------------------------------------------
to Securities of the Issuer
---------------------------
Pursuant to the terms of the Merger Agreement, each outstanding share
of Common Stock, including the Common Stock beneficially owned by TCI, was
converted into the right to receive one quarter share of the Series A Stock, one
Right with respect to each whole share of Series A Stock and cash in lieu of
fractional shares of Series A Stock and Rights. The description of the Merger
and the securities received in connection therewith contained herein is
qualified in its entirety by reference to the text of the Merger Agreement. The
Merger Agreement is incorporated herein by reference and is attached to this
Statement as Exhibit B.
The Rights associated with the Series A Stock have been issued pursuant
to the Rights Agreement dated July 11, 1997, among TCI, the Issuer and The Bank
of New York, as Rights Agent. The description of the Rights contained herein is
qualified in its entirety by reference to the text of the Rights Agreement. The
Rights Agreement is incorporated herein by reference and is attached to this
Statement as Exhibit C.
Except as described above and in Items 3 and 7, hereof, there are
presently no contracts, arrangements, understandings or relationships among TCI
and other persons with respect to the Common Stock of the Issuer.
6
<PAGE>
ITEM 7. Material to be Filed as Exhibits
--------------------------------
(A) Registration Statement on Form S-4, filed by TCI, the Issuer and
DMX on June 12, 1997, and thereafter amended and ordered effective June 12,
1997, under Commission File No. 333-28613, which is hereby incorporated by this
reference.
(B) Agreement and Plan of Merger, dated as of February 6, 1997, as
amended by Amendment One to Merger Agreement dated May 29, 1997, among DMX, TCI,
the Issuer, and TCI Merger Sub, Inc. filed June 12, 1997, as Appendix I to the
Prospectuses/Proxy Statement contained in said Registration Statement, under
Commission File No. 333-28613, which is hereby incorporated by this reference.
(B) Rights Agreement, dated July 11, 1997, among TCI, the Issuer and
The Bank of New York, as Rights Agent, filed June 12, 1997, as part of said
Registration Statement, under Commission File No.333-28613, which is hereby
incorporated by this reference.
7
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
July 18, 1997 TELE-COMMUNICATIONS, INC.
/s/ Stephen M. Brett
-------------------------
Stephen M. Brett
Executive Vice President and
General Counsel
8
<PAGE>
SCHEDULE 1
----------
Directors, Executive Officers and Controlling Persons
of
Tele-Communications, Inc. ("TCI")
<TABLE>
<CAPTION>
DIRECTORS
-----------------------
Principal Business or
Principal Occupation & Organization in Which
Name Business Address such Employment Is Conducted
- ---- ----------------------- ----------------------------
<S> <C> <C>
Tony L. Coelho Director of TCI; Cable television &
Chairman & Chief telecommunications
Executive Officer of & programming services;
ETC w/tci, Inc.;
Chairman & Chief
Executive Officer of
Coelho Associates, LLC Investment consulting firm
1325 Avenue of the
Americas,
26th Floor
New York, New York
10019
Donne F. Fisher Consultant & Director Cable television &
of TCI; Business telecommunications
Executive & programming services
5619 DTC Parkway
Englewood, CO 80111
John W. Gallivan Director of TCI; Newspaper publishing
Chairman of the Board
of Kearns-Tribune
Corporation
400 Tribune Building
Salt Lake City, UT
84111
Paul A. Gould Director of TCI, Investment banking
Managing Director of services
Allen & Company
Incorporated
711 5th Avenue
New York, New York
10022
Leo J. Hindery, Jr. President, Chief Cable television &
Operating Officer and telecommunications
Director of TCI & programming services
5619 DTC Parkway
Englewood, CO 80111
Jerome H. Kern Director of TCI; Business Consulting; Law
Business Consultant;
Special Counsel to
Baker & Botts, L.L.P.
5619 DTC Parkway
Englewood, CO 80111
Kim Magness Director of TCI; Management of various
Business Executive business enterprises
4000 E. Belleview
Englewood, CO 80111
John C. Malone Chairman of the Cable television &
Board, Chief telecommunications
Executive Officer & & programming services
Director of TCI
5619 DTC Parkway
Englewood, CO 80111
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
Principal Business or
Principal Occupation & Organization in Which
Name Business Address such Employment Is Conducted
- ---- ----------------------- ----------------------------
<S> <C> <C>
Robert A. Naify Director of TCI; Provider of services to
President & Chief the motion picture
Executive Officer of industry
Todd-AO Corporation
172 Golden Gate Avenue
San Francisco, CA 94102
J.C. Sparkman Consultant & Director Cable television &
of TCI telecommunications
5619 DTC Parkway & programming services
Englewood, CO 80111
EXECUTIVE OFFICERS
-----------------------
Gary K. Bracken Senior Vice President Cable television &
& Controller telecommunications
of TCI Communications, & programming services
Inc.
5619 DTC Parkway
Englewood, CO 80111
Robert R. Bennett Executive Vice Cable television &
President of TCI telecommunications
5619 DTC Parkway & programming services
Englewood, CO 80111
Stephen M. Brett Executive Vice Cable television &
President, Secretary telecommunications
& General Counsel of & programming services
TCI
5619 DTC Parkway
Englewood, CO 80111
Brendan R. Clouston Executive Vice Cable television &
President of TCI telecommunications
5619 DTC Parkway & programming services
Englewood, CO 80111
Marvin Jones Director, Executive Cable television &
Vice President & Chief telecommunications
Operating Officer of & programming services
TCI Communications,
Inc.
5619 DTC Parkway
Englewood, CO 80111
Larry E. Romrell Executive Vice Cable television &
President of TCI telecommunications
5619 DTC Parkway & programming services
Englewood, CO 80111
Bernard W. Schotters, II Senior Vice President Cable television &
& Treasurer of TCI telecommunications
Communications, Inc. & programming services
5619 DTC Parkway
Englewood, CO 80111
Fred A. Vierra Executive Vice Cable television &
President of TCI telecommunications
5619 DTC Parkway & programming services
Englewood, CO 80111
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
-------------
- --------------------------------------------------------------------------------
EXHIBIT NUMBER EXHIBIT PAGE
- --------------------------------------------------------------------------------
<C> <S> <C>
7(A) Registration Statement on Form S-4, filed by --
TCI, the Issuer and DMX on June 12, 1997,
and thereafter amended and ordered effective
June 12, 1997, under Commission File No.
333-28613, which is hereby incorporated by
this reference.
7(B) Agreement and Plan of Merger, dated as of --
February 6, 1997, as amended by Amendment
One to Merger Agreement dated May 29, 1997,
among DMX, TCI, the Issuer, and TCI Merger
Sub, Inc. filed June 12, 1997, as Appendix I
to the Prospectuses/Proxy Statement
contained in said Registration Statement,
under Commission File No. 333-28613, which
is hereby incorporated by this reference.
7(C) Rights Agreement, dated July 11, 1997, among --
TCI, the Issuer and The Bank of New York, as
Rights Agent, filed June 12, 1997, as part
of said Registration Statement, under
Commission File No.333-28613, which is
hereby incorporated by this reference.
</TABLE>
11
