Report on ONO Midco, SAU and its subsidiaries as of December 31 ...

More documents

Recommendations

Info

These provisions apply to tax periods starting January 1, 2012 and the Spanish thin capitalization rules no longer apply from that date. 2. Effective as of March 31, 2011, the special free depreciation regime regulated in the Eleventh Addition Provision of the Spanish CIT Law has been abolished. The free depreciation of investments made prior the abolition of the regime has been limited. 3. For tax years 2012 and 2013, the following temporary measures have been implemented: (i) (ii) (iii) Advance tax payments made by taxpayers with turnover of at least €20 million during the 12 months before the beginning of tax years starting in 2012 and 2013 cannot be less than 8% of the profits for those periods, with some specified adjustments. The minimum advance tax can be reduced to 4% if at least 85% of the income obtained during those tax periods is eligible for certain deductions and exemptions under an income tax treaty. For the advance payment due on April 20, the rates will be 4% and 2%, respectively. The maximum annual limit deductible for tax goodwill arising from the acquisition of companies and for business restructuring has been reduced from 5% to 1%. The current overall limit on tax credits has been reduced from 35% to 25%, including the tax credit for reinvesting extraordinary benefits. The limit is reduced from 60% to 50% if the deduction for R&D&I activities is more than 10% of the tax due. Impairment of Assets The accounting treatment of investment in property, plant and equipment and intangible assets means that estimates must be made to determine their useful lives for the purposes of depreciation or amortization. The determination of useful lives requires estimates regarding expected technological evolution and alternative uses of the assets. Assumptions regarding the technological environment and its future development imply a significant degree of judgment, inasmuch as the time and the nature of future technological changes are difficult to predict. When impairment of fixed assets is identified, a value adjustment is recognized and charged to the income statement for the period. The determination of the need to recognize an impairment loss implies making estimates that include, among others, an analysis of the causes of the possible impairment and the time and the expected amount thereof. Likewise, factors such as technological obsolescence, the suspension of certain services and other changes in circumstances that create the need to assess possible impairment are taken into account. Fair Value of Derivatives and Other Financial Instruments The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. We select a variety of methods and makes assumptions that are mainly based on market conditions existing at each balance sheet date. We have used discounted cash flow analysis as well as third party valuations to determine the fair value of the derivatives and other financial assets and liabilities. Provisions Provisions are recognized when we have a present obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and the amount has been reliably estimated. The obligation may be legal or constructive, derived from, among other factors, regulations, contracts, normal practices or public commitments that create a valid expectation for third parties that we will accept certain liabilities. The provision is measured by the best estimate of the payment that will be necessary to settle the relevant obligation, taking into consideration all the information available on the closing date for the financial statements, including the opinions of independent experts, such as legal advisors or consultants. Due to the unpredictability inherent in estimating the amount of provisions, the actual payments may differ from the amounts initially recognized on the basis of the estimates made. 72
MANAGEMENT DIRECTORS AND SENIOR MANAGEMENT All decisions regarding our business, which are required to be taken at the Board of Directors level, are made by the Board of Directors of GCO, our ultimate corporate parent. Description of GCO’s Shareholders’ Agreement GCO’s Shareholders’ Agreement dated July 29, 2005, as amended (“the GCO’s Shareholders’ Agreement” or the “Shareholder Agreement”), provides that GCO’s Board of Directors will consist of 13 directors. Pursuant to the Shareholders’ Agreement, there must be two executive directors, the President (since November 2008, José María Castellano) and the Chief Executive Officer (since May 2009, Rosalía Portela). In addition, two of the directors must be independent directors, one of whom will be appointed by the shareholders who were shareholders of GCO prior to the date of the Shareholders’ Agreement (the “Prior Shareholders”) and approved by the shareholders who became shareholders following the date of effectiveness of the Shareholders’ Agreement that is November 2005 (the “New Shareholders”). The other independent director will be appointed by the New Shareholders and approved by the Prior Shareholders. With respect to the remaining nine directors, owners of each stake of 11.11% of the share capital in GCO will be permitted to appoint one director. If the Board cannot be fully appointed in this manner, then shareholders with stakes or remaining portions less than 11.11% shall have the right to appoint directors in descending order of their stake or remaining portion of their stake. While the GCO Board of Directors may delegate many of its powers to the President and the Chief Executive Officer, certain actions will require the prior approval of the Board of Directors. Certain corporate decisions (mainly amendments to the by-laws, merger, spin-off, liquidation, winding-up, issuance of convertible securities, dividend policy and treasury stock) require the favorable vote of the holders of at least two-thirds of GCO’s voting shares. Administration Agreement On March 30, 2002, Cableuropa signed an Administration Agreement with GCO, which was amended on March 28, 2003 and replaced by a new Administration Agreement dated December 22, 2011. Pursuant to the Administration Agreement, the GCO Board of Directors must approve all significant decisions affecting the business and corporate affairs of the ONO Group. In addition, GCO appoints the directors to Cableuropa’s Board of Directors. Cableuropa’s Chief Executive Officer and President, if necessary, execute all decisions that are not subject to a formal approval by the Board of Directors. Directors of GCO As of December 31, 2011, the Directors of GCO were as follows: Name Age Title Member of Board of Directors since Terms Expires José María Castellano 64 Chairman and President 2006 2012 Rosalía Portela 60 Director and CEO 2009 2012 John Hahn (1) 53 Director, First Vice Chairman 2005 2014 Val Telecomunicaciones Cartera, S.L. represented by Diego L. Lozano (2) 51 Director, Second Vice Chairman 2009 2012 Alejandro Valencia (3) 46 Director 2009 2012 Soren Oberg (4) 40 Director 2005 2014 Tom Walker (5) 49 Director 2005 2014 Joshua L. Steiner (6) 45 Director 2005 2011 Felipe Blanco (7) 40 Director 2011 2014 Eduardo Serra (8) 64 Director 2009 2012 Particitel International Limited Partnership represented by Robert Coallier (9) 54 Director 2010 2013 Tony Ball (10) 55 Director 2006 2012 José Luis Nueno (8) 51 Director 2009 2012 (1) Appointed as proposed by Providence Equity Partners. (2) Appointed as proposed by Val Telecomunicaciones. (3) Appointed as proposed by Grupo Multitel. (4) Appointed as proposed by Thomas H. Lee Partners. (5) Appointed as proposed by CCMP Capital Advisors. 73
Page 1 and 2:
Report on ONO Midc
Page 3 and 4:
• Operating free cash flow do not
Page 5 and 6:
• the effect of changes in the re
Page 7 and 8:
CONTENTS INFORMATION ON THE COMPANY
Page 9 and 10:
RECENT DEVELOPMENTS Key operating e
Page 11 and 12:
SUMMARY FINANCIAL INFORMATION AND O
Page 13 and 14:
Reconciliation of EBITDA, operating
Page 15 and 16:
RISK FACTORS In addition to other i
Page 17 and 18:
We do not expect to generate suffic
Page 19 and 20:
RISKS RELATING TO OUR BUSINESS We m
Page 21 and 22: altogether. In addition, the broadb
Page 23 and 24: evenues could be adversely affected
Page 25 and 26: • Regulations relating to accessi
Page 27 and 28: Wholesale & Other: We provide carri
Page 29 and 30: espectively), which stands in contr
Page 31 and 32: Our Products and Services We curren
Page 33 and 34: We offer all our broadband customer
Page 35 and 36: services, ranging from simple fixed
Page 37 and 38: coming years. For example, in June
Page 39 and 40: technology, although depending on O
Page 41 and 42: Supplier Network Equipment Next Gen
Page 43 and 44: not belonging to a group (following
Page 45 and 46: Telecommunications Law, the MIET ha
Page 47 and 48: The right to provide electronic com
Page 49 and 50: As holders of spectrum concessions
Page 51 and 52: A general provision against anticom
Page 53 and 54: programs and content in order to in
Page 55 and 56: SELECTED HISTORICAL CONSOLIDATED FI
Page 57 and 58: MANAGEMENT’S DISCUSSION AND ANALY
Page 59 and 60: aggregate price of these services p
Page 61 and 62: Residential Services Residential re
Page 63 and 64: Operating data in units % change Fi
Page 65 and 66: Operating Expenses Our operating ex
Page 67 and 68: Net Financial Expense Our net finan
Page 69 and 70: Cash flows from investing activitie
Page 71: Currency Risk While the vast majori
Page 75 and 76: Starman AS, Elipso Finance and Vest
Page 77 and 78: Víctor Guerrero is our Director of
Page 79 and 80: The amounts and percentages of shar
Page 81 and 82: filing and the court has to evaluat
Page 83 and 84: DESCRIPTION OF OTHER INDEBTEDNESS T
Page 85 and 86: Maturity: Tranche A and Tranche B m
Page 87 and 88: the event that at the end of each C
Page 89 and 90: Senior Secured Notes On October 22,
Page 91 and 92: • Second, in payment of the follo
show all

Report on ONO Midco, SAU and its subsidiaries as of December 31 ...

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?