UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
Amendment No. 2
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): DECEMBER 7, 2001
UPC POLSKA, INC. UNITED PAN-EUROPE
---------------------------- COMMUNICATIONS N.V.
(Exact name of registrant -------------------------------
as specified in its charter) (Exact name of registrant as
specified in its charter)
Delaware The Netherlands
----------------------------- ------------------------------
(State or Other Jurisdiction (State or Other Jurisdiction
of Incorporation) of Incorporation)
000-22877 000-25365
----------------------------- ------------------------------
(Commission File Number) (Commission File Number)
06-148715 98-0191997
----------------------------- ------------------------------
(I.R.S. Employer (I.R.S. Employer
Identification Number) Identification Number)
4643 Ulster Street, Suite 1300, Boeing Avenue 53
Denver, Colorado 80237 1119 PE, Schiphol Rijk
----------------------------- The Netherlands
(Address and zip code of ------------------------------
principal executive offices) (Address and zip code of
principal executive offices)
(303) 770-4001 (31) 20-778-9840
----------------------------- -----------------------------
(Registrant's telephone number, (Registrant's telephone number,
including area code) including area code)
1
ITEM 2. ACQUISITIION OR DISPOSITION OF ASSETS
As reported on Current Report on Form 8-K, filed on December 21, 2001,
on August 10, 2001, United Pan-Europe Communications N.V. (UPC), the parent
company of UPC Polska, Inc. (the Company), and Canal+ Group (Canal+), the
television and film division of Vivendi Universal S.A., announced the signing of
definitive agreements to merge their respective Polish direct-to-home (DTH)
satellite television platforms, to form a common Polish DTH platform. The
transactions contemplated by such agreements were consummated on December 7,
2001. Pursuant to Item 7(a)(4) of Form 8-K, Form 8-K/A Amendment No. 1 filed on
February 20, 2002, amended the Current Report filed on Form 8-K on December 21,
2001, to include the pro forma financial information required by Item 7(b) of
Form 8-K. As part of the transactions, the Company, through its affiliate Polska
Telewizja Cyfrowa TV Sp. z o.o. (PTC), contributed its Polish and United Kingdom
DTH assets to Telewizyjna Korporacja Partycypacyjna S.A. (TKP), the Polish
subsidiary of Canal+, and agreed to fund 30.0 million euros (approximately $26.8
million as at December 7, 2001) in the form of a shareholder loan to TKP. The
Company received 150.0 million euros (approximately $133.4 million as of
December 7, 2001) in cash and PTC received a 25% ownership interest in TKP upon
completion of certain Polish legal formalities in connection with the issuance
of new TKP shares.
This Current Report on Form 8-K/A is being filed to amend the Current
Report on Form 8-K/A Amendment No. 1 filed on February 20, 2002, and, more
specifically, to reflect the Company's 25% ownership interest in TKP as having a
fair value of 30 million euros (approximately $27.5 million as at September 30,
2001). The final valuation of the Company's investment in TKP was completed in
connection with the audit of the Company's financial statements as of and for
the year ended December 31, 2001 and resulted in an adjustment of the fair value
from 65 million euros (approximately $59.5 million as at September 30, 2001) to
30 million euros (approximately $27.5 million as at September 30, 2001).
Accordingly, the Company's 25% investment in TKP was reflected in the Company's
Annual Report on Form 10-K, filed with the SEC on April 4, 2002 ("2001 Form
10-K"), having a value of 30 million euros (approximately $26.8 million as of
December 7, 2001). Additionally this report amends the US dollar value as of
December 7, 2001, of the Company's shareholder loan to TKP and the cash received
by the Company from $27.7 million to $26.8 million and from $138.8 million to
$133.4 million, respectively. This amendment to Form 8-K conforms the financial
statement and pro forma financial information filed pursuant to Item 7(b) of
Form 8-K/A Amendment 1 on February 20, 2002, to the Company's presentation in
its 2001 Form 10-K.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(b) Pro forma financial information
The following unaudited pro forma condensed consolidated financial
statements, which reflect the consolidated financial position of the Company
assuming that the disposition of the Company's Polish and United Kingdom DTH
assets had occurred on September 30, 2001, and the consolidated results of
operations of the Company assuming that the disposition had occurred as of
January 1, 2001 and January 1, 2000, respectively, are filed with this report:
o Pro forma Unaudited Condensed Consolidated Balance Sheet as of
September 30, 2001,
o Pro forma Unaudited Condensed Consolidated Statement of Operations for
the nine months ended September 30, 2001,
o Pro forma Unaudited Condensed Consolidated Statement of Operations for
the Year ended December 31, 2000,
o Notes to Pro forma Unaudited Condensed Consolidated Financial
Statements.
The following unaudited pro forma financial information should be read
in conjunction with the consolidated financial statements and related footnotes
included in the Company's Annual Report on Form 10-K for the year ended December
31, 2000, and Quarterly Report on Form 10-Q for the quarter ended September 30,
2001. The following pro forma information is presented for illustrative purposes
only and is not necessarily indicative of future operating results or financial
position.
2
UPC POLSKA, INC.
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS AS
OF SEPTEMBER 30, 2001
ASSETS
Pro forma
Historical Disposition adjustment Pro forma
---------- ----------- ---------- ---------
(in thousands)
Current assets:
Cash and cash equivalents $ 9,922 $ (4,450)a,d $ 109,920 d $ 115,392
Restricted Cash - - a 27,480 d 27,480
Trade accounts receivable, net 10,919 (3,710)a - 7,209
Programming and broadcast rights 4,364 - (4,364)b -
VAT recoverable 1,001 (416)a - 585
Prepayments 4,760 (3,822)a - 938
Due from UPC affiliates 28,879 (8,340)a - 20,539
Other current assets 989 138,907 a (129,561)d 10,335
----------- ---------- -------- ---------
Total current assets 60,834 118,169 3,475 182,478
----------- ---------- -------- ---------
Property, plant and equipment:
Cable television systems assets 156,619 - - 156,619
DTH, transmission and production equipment 149,732 (149,732)a - -
Construction in progress 3,961 - 104 c 4,065
Vehicles 2,340 (1,309)a 93 c 1,124
Other 27,457 (15,514)a 10,086 c 22,029
----------- ---------- -------- ---------
340,109 (166,555) 10,283 183,837
Less accumulated depreciation (101,612) 57,410 a - (44,202)
----------- ---------- -------- ---------
Net property, plant and equipment 238,497 (109,145) 10,283 139,635
Inventories for construction 5,145 (112)a - 5,033
Intangibles, net 821,131 (467,118)a,d 1,033 c 355,046
Investments in affiliated companies 14,622 27,480 a - 42,102
----------- ---------- -------- ---------
Total assets $ 1,140,229 $ (430,726) $ 14,791 $ 724,294
=========== ========== ======== =========
3
UPC POLSKA, INC.
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS AS
OF SEPTEMBER 30, 2001 (CONTINUED)
LIABILITIES AND STOCKHOLDER'S EQUITY
Pro forma
Historical Disposition adjustment Pro forma
---------- ----------- ---------- ---------
(in thousands)
Current liabilities:
Accounts payable and accrued expenses $ 54,267 $ (16,567)a $ 31,762 b,c $ 69,462
Due to UPC 7,978 (169)a - 7,809
Due to TKP - - 27,480 d 27,480
Accrued interest 595 - - 595
Deferred revenue 6,257 (3,756)a - 2,501
----------- ---------- -------- ----------
Total current liabilities 69,097 (20,492) 59,242 107,847
----------- ---------- -------- ----------
Long-term liabilities:
Notes payable and accrued interest to UPC 442,033 (111)a (321)b 441,601
Notes payable 408,459 - - 408,459
Other long term liabilities 951 (951)a - -
----------- ---------- -------- ----------
Total liabilities 920,540 (21,554) 58,921 957,907
----------- ---------- -------- ----------
Commitments and contingencies
Stockholder's equity:
Common stock, $.01 par value; 1,000 shares
authorized, shares issued and outstanding
1,000 as of September 30, 2001
and December 31, 2000 - - - -
Paid-in capital 911,562 - - 911,562
Accumulated other comprehensive loss (83,049) 44,619 a - (38,430)
Accumulated deficit (608,824) (453,791)a,d (44,130)b,c (1,106,745)
----------- ---------- -------- ----------
Total stockholder's equity / (deficiency) 219,689 (409,172) (44,130) (233,613)
----------- ---------- -------- ----------
Total liabilities and stockholder's equity $ 1,140,229 $ (430,726) $ 14,791 $ 724,294
=========== ========== ======== ==========
4
UPC POLSKA, INC.
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE
NINE MONTHS ENDED SEPTEMBER 30, 2001
Pro forma
Historical Disposition adjustment Pro forma
---------- ----------- ---------- ---------
(in thousands)
Revenues $ 107,612 $ (19,704)e $ (28,545)g $ 59,363
Operating expenses:
Direct operating expenses 85,450 (4,535)e (59,696)g 21,219
Selling, general and administrative expenses 47,717 (18,570)e - 29,147
Depreciation and amortization 96,334 (56,257)e - 40,077
Impairment of DTH equipment 19,491 (19,491)e - -
---------- ---------- ------- ----------
Total operating expenses 248,992 (98,853) (59,696) 90,443
---------- ---------- ------- ----------
Operating loss (141,380) 79,149 31,151 (31,080)
Interest and investment income 833 (297)e 2,925 f 3,461
Interest expense (70,350) 265 e - (70,085)
Equity in losses of affiliated companies (723) - (27,480)f (28,203)
Foreign exchange loss (3,135) (32,852)e - (35,987)
Non-operating expense (919) 799 e - (120)
Loss on disposition - (492,497)e - (492,497)
---------- ---------- ------- ----------
Loss before income taxes and
minority interest (215,674) (445,433) 6,596 (654,511)
Income tax expense (162) - - (162)
---------- ---------- ------- ----------
Net loss applicable to holder of common stock $ (215,836) $ (445,433) $ 6,596 $ (654,673)
========== ========== ======= ==========
Basic and diluted Loss per common share N/A N/A N/A N/A
========== ========== ======= ==========
5
UPC POLSKA, INC.
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR
THE YEAR ENDED DECEMBER 31, 2000
Pro forma
Historical Disposition adjustment Pro forma
---------- ----------- ---------- ---------
(in thousands)
Revenues $ 133,583 $ (25,755)e $ (30,724)g $ 77,104
Operating expenses:
Direct operating expenses 132,154 705 e (76,082)g 56,777
Selling, general and administrative expenses 63,156 (30,202)e - 32,954
Depreciation and amortization 109,503 (63,399)e - 46,104
Impairment of DTH equipment 7,734 (7,734)e - -
---------- ---------- --------- ----------
Total operating expenses 312,547 (100,630) (76,082) 135,835
---------- ---------- --------- ----------
Operating loss (178,964) 74,875 45,358 (58,731)
Interest and investment income 1,329 (605)e 3,961 f 4,685
Interest expense (73,984) 537 e - (73,447)
Equity in losses of affiliated companies (895) - (27,480)f (28,375)
Foreign exchange gain/(loss), net 3,397 (28,721)e - (25,324)
Non-operating expense 591 (603)e - (12)
Loss on disposition - (503,583)e (503,583)
---------- ---------- --------- ----------
Loss before income taxes and
minority interest (248,526) (458,100) 21,839 (684,787)
Income tax expense (285) 183 e - (102)
---------- ---------- --------- ----------
Net loss applicable to holder of common stock $ (248,811) $ (457,917) $ 21,839 $ (684,889)
========== ========== ========= ==========
Basic and diluted Loss per common share N/A N/A N/A N/A
========== ========== ========= ==========
6
UPC POLSKA, INC.
NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Basis of Presentation
The unaudited pro forma condensed consolidated balance sheet as of September 30,
2001, presents the consolidated financial position of the Company assuming that
the disposition of the Company's DTH segment had occurred on September 30, 2001.
The unaudited pro forma condensed consolidated statements of operations for the
nine months ended September 30, 2001, and the year ended December 31, 2000,
present the consolidated results of operations of the Company assuming that the
disposition had occurred as of January 1, 2001 and January 1, 2000,
respectively. The unaudited pro forma financial information is based on
assumptions and does not purport to be indicative of the results of operations
or the financial position that would have actually occurred if the disposition
had been consummated on the dates indicated. The pro forma financial information
is based on the Company's previously reported historical financial statements
and adjusted for the assumptions and estimates described in the accompanying
Notes to the Pro Forma Unaudited Condensed Consolidated Financial Statements.
Pro Forma Adjustments
The following notes describe the adjustments included in the accompanying
financial statements:
Balance Sheet
a. Adjustment to reflect (i) the estimated proceeds of 30 million euros
(approximately $27.5 million, as of September 30, 2001) being the fair value of
the 25% interest in TKP, (ii) the elimination of assets and liabilities sold in
the disposition, (iii) the estimated net effect of the restructuring of balances
receivable from disposed entities of $240.9 million, and (iv) the accrued
professional expenses and local tax paid in connection with the disposition of
$8.1 million.
b. Adjustments to reflect the estimated accrued cost associated with: (i) the
restructuring of channel agreements of $2.5 million, (ii) closure of sport
channel of $13.1 million, (iii) restructuring of the management of $0.6 million,
(iv) vacant property of $0.5 million, (v) and the goodwill write off amounting
to $221.9 million.
c. Adjustments to reflect the reallocation of: (i) leasehold improvements and
intangibles from DTH segment to Cable segment of $6.3 and $1.0 million,
respectively and (ii) DTH reception systems from DTH segment to Programming
segment of $3.9 million.
d. Cash proceed of 150 million euros (approximately $137.4 million, as of
September 30, 2001) from the settlement of loan receivable from DTH segment and
cash contribution into TKP of 30 million euros (approximately $27.5 million, as
of September 30, 2001).
Income Statement
e. Adjustments to reflect the estimated loss on the disposition.
f. Use of the cash proceed from the repayment of the loan receivable of $109.9
million, and loss attributable to the Company's minority interest in TKP.
g. Adjustment to reflect the decrease in revenue and direct cost in programming
segment resulting from reduced level of operation.
7
(c) Exhibits
Exhibit Number Description
2.1 Closing Agreement, dated as of December 7, 2001, by and
among UPC, Canal+, the Company, PTC and TKP.*
2.2 Shareholders Agreement, dated August 10, 2001, by and
among UPC, PTC, Canal+ and Polcom Invest S.A.*
2.3 Contribution and Subscription Agreement, dated as of
August 10, 2001, by and among UPC, Canal+, the Company,
PTC and TKP.*
* Previously filed on December 21, 2001 as an exhibit to Form 8-K.
8
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: April 19, 2002
UPC POLSKA, INC.
By: /s/ SIMON BOYD
----------------------------------------
Name: Simon Boyd
Title: Chief Executive Officer
UNITED PAN-EUROPE COMMUNICATIONS N.V.
By: /s/ ANTON A.M. TUIJTEN
-----------------------------------------
Name: Anton A.M. Tuijten
Title: Member of the Board of Management
and General Counsel
9