**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

**FORM 20-F**

 

**(Mark One)**

**o****                                ****Registration statement pursuant to Section 12(b) or12(g) of the Securities Exchange Act of 1934 (Fee required)**

 

**or**

 

ý**                                 ****Annual reportpursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for thefiscal year ended December 31, 2002 (No Fee required)**

 

**or**

 

**o****                                ****Transaction report pursuant to Section 13 or 15(d) ofthe Securities Exchange Act of 1934 for the transaction period from N/A to N/A(No Fee required)**

 

**Commission filenumber 333-10976-01**

 

**ONO Finance PLC**

(Exact Name of Registrant asSpecified in Its Charter)

 

**England and Wales**

(Jurisdiction of Incorporationor Organization)

 

**200 Aldersgate Street, London EC1A 4JJ**

(Address of Principal ExecutiveOffices)

 

**Securities registered or to be registered pursuant to Section12(b) of the Act:**

** **

| **Title of each class** |   | **Name of each exchange on which  registered** |
|-------------------------|--------|------------------------------------------------|
| **None**                |   | **None**                                       |

 

Securitiesregistered or to be registered pursuant to Section 12(g) of the Act: **None**

 

Securitiesfor which there is a reporting obligation pursuant to Section 15(d) of the Act:

 

**$275,000,00013% Notes Due 2009**

**€125,000,00013% Notes Due 2009**

**€200,000,00014% Notes Due 2010**

**$200,000,000 14% Notes Due 2011**

**€150,000,000 14% Notes Due 2011**

 

Indicatethe number of outstanding shares of each of the issuer’s classes of capital orcommon stock as of the close of the period covered by the annual report.

 

**50,000 OrdinaryShares**

 

Indicateby check mark whether the registrant: (1) has filed all reports required to befiled by Section 13 or 15(d) of the Securities Exchange Act of 1934 during theproceeding 12 months (or for the shorter period that the registrant wasrequired to file such reports), and (2) has been subject to such filingrequirements for the past 90 days.

 

| **(1)   N/A** |   | **(2)   N/A** |
|------------------------------|--------|------------------------------|

 

Indicatedby check mark which financial statement item the registrant has elected tofollow.

| Item  17 o |   | Item 18 ý |
|------------|--------|----------------|

 

 

----

 

ONO Finance PLC (the “Company”)is a company organized under the laws of England and Wales. Referencesto the “2009 dollar Notes” are to the $275,000,000 13% Notes due 2009 andreferences to the “2009 euro Notes” are to the €125,000,000 13% Notes due 2009(together with the 2009 dollar Notes, the “2009 Notes”), references to the“2010 euro Notes” are to the €200,000,000 14% Notes due 2010 (“2010 Notes”)references to the “2011 dollar Notes” are to the $200,000,000 14% Notes due2011 and references to the “2011 euro Notes” are to the €150,000,000 14% Notesdue 2011 (together with the 2011 dollar Notes, the “2011 Notes”), all issued byONO Finance PLC.  The 2009 Notes, the2010 Notes and the 2011 Notes are collectively referred to as the “Notes”.

 

As described below in Item 5. “Operating and FinancialReview and Prospects” and in our financial statements included in Item 18.“Financial Statements”, on February 13, 2003 the Company cancelled asignificant portion of the Notes. Following this cancellation, €45,628,000 in principal amount of 2009euro Notes, $92,098,000 in principal amount of the 2009 dollar Notes,€113,702,000 in principal amount of 2010 euro Notes, €112,053,000 in principalamount of 2011 euro Notes, and $83,514,000 in principal amount of 2011 dollarNotes remain outstanding.

 

**Presentation of Financial and CertainOther Information**

 

Unless otherwise indicated orotherwise required by the context, all references in this Form 20-F to “EUR”,“euro” or “€” are to the lawfulcurrency in eleven Member States of the European Union. “U.S. dollars”,“dollars”, “U.S.$” or “$” are to United States dollars, the lawful currency ofthe United States of America. References to “pounds” or “£” are to British pounds sterling, the lawfulcurrency of the United Kingdom.

 

Amounts stated in U.S. dollars, unless otherwiseindicated, have been translated from pounds at an assumed rate solely for yourconvenience, and should not be construed as representations that pound amounts actuallyrepresent such U.S. dollar amounts or could be converted into U.S. dollars atthe rate indicated or at any other rate. Unless indicated otherwise, U.S. dollar amounts have been translatedfrom the pound at the rate of £1.00 = $1.6095, the noon buying rate in New YorkCity for cable transfers in pounds as certified for customs purposes by theFederal Reserve Bank of New York, or the Pound Noon Buying Rate, on December31, 2002.

 

The Company maintainsits accounting records and prepares its statutory accounts in accordance withgenerally accepted accounting principles in the United Kingdom, or U.K. GAAP.The Company’s audited financial statements as of December 31, 2001 and 2002 andfor the years ended December 31, 2000, 2001 and 2002, and, unless otherwiseindicated, other financial information in this Form 20-F, have been prepared inaccordance with U.K. GAAP, which differs in certain significant respects fromgenerally accepted accounting principles in the United States, or U.S. GAAP.For a discussion of the most significant differences between U.K. GAAP and U.S.GAAP and reconciliations of net income and shareholders’ equity to U.S. GAAP,see note 13 of the notes to our financial statements included elsewhere in thisForm 20-F.

 

Certain numerical figuresincluded in the Form 20-F have been subject to rounding adjustments;accordingly, numerical figures shown as totals in certain tables may not be anarithmetic aggregation of the figures which precede them.

 

i

----

 

**Further Information**

 

The Notes have been guaranteed by Cableuropa, S.A.U.(“Cableuropa”) and certain of its subsidiaries (collectively, the “NoteGuarantors”).  Information regardingCableuropa and the other Note Guarantors is available in Cableuropa’s Form 20-Ffiled with the Securities and Exchange Commission on May 9, 2003 (the“Cableuropa Annual Report”).

 

**CAUTIONARY STATEMENT FOR PURPOSES OF THE “SAFE HARBOR”PROVISIONS OF THE UNITED STATES PRIVATE SECURITIES LITIGATION REFORM ACT OF1995.  This Annual Report on Form 20-Fcontains certain forward looking statements as defined in section 27A of theSecurities Act and in section 21E of the United States Securities Exchange Actof 1934.  These forward lookingstatements are accompanied by, and should be read in conjunction with, anexplanation of factors that could cause actual results to differ materiallyfrom those expressed as such forward looking statements.  By their nature, forward looking statementsinvolve risk and uncertainty, and the factors described in the context of suchforward looking statements and other factors referred to in this Annual Reporton Form 20-F, particularly in Item 4. “Information on the Company” and Item 5.“Operating and Financial Review and Prospects”, could cause actual results anddevelopments to differ materially from those expressed in or implied by suchforward looking statements.  The Companyis claiming the benefits of the safe harbor provisions referred to above.**

 

The Company’s registered office is located at 200Aldersgate Street, London EC1A 4JJ, England.

 

ii

----

 

**TABLE OF CONTENTS**

 
| Item 1.   | Identity  of Directors, Senior Management and Advisors                        |
|-----------|-------------------------------------------------------------------------------|
|      |                                                                          |
| Item 2.   | Offer  Statistics and Expected Timetable                                      |
|      |                                                                          |
| Item 3.   | Key  Information                                                              |
|      |                                                                          |
| Item 4.   | Information  on the Company                                                   |
|      |                                                                          |
| Item 5.   | Operating  and Financial Review and Prospects                                 |
|      |                                                                          |
| Item 6.   | Directors,  Senior Management and Employees                                   |
|      |                                                                          |
| Item 7.   | Major  Shareholders and Related Party  Transactions                      |
|      |                                                                          |
| Item 8.   | Financial  Information                                                        |
|      |                                                                          |
| Item 9.   | The  Offer and Listing                                                        |
|      |                                                                          |
| Item  10. | Additional  Information                                                       |
|      |                                                                          |
| Item  11. | Quantitative  and Qualitative Disclosure about Market Risk                    |
|      |                                                                          |
| Item  12. | Description  of Securities Other than Equity Securities                       |
|      |                                                                          |
| Item  13. | Defaults,  Dividend Arrearages and Delinquencies                              |
|      |                                                                          |
| Item  14. | Material  Modifications to the Rights of Security Holders and Use of Proceeds |
|      |                                                                          |
| Item  15. | Controls  and Procedures                                                      |
|      |                                                                          |
| Item  16. | Reserved                                                                      |
|      |                                                                          |
| Item  17. | Financial  Statements                                                         |
|      |                                                                          |
| Item  18. | Financial  Statements                                                         |
|      |                                                                          |
| Item  19. | Exhibits                                                                      |

 

----

 

**PART I**

 

**Item 1****.  Identity of Directors, Senior Management andAdvisors**

 

Not applicable.

 

**Item 2****.  Offer Statistics and Expected Timetable**

 

Not applicable.

 

**Item 3****.  Key Information**

 

**Selected Financial Data**

 

The following tables presentselected financial data as of and for each of the four years in the periodended December 31, 2002.  The selectedfinancial data presented below as of and for each of the four years in theperiod ended December 31, 2002 are derived from our audited financial statementsfor these periods and should be read in conjunction with these financialstatements and related notes thereto included in this Form 20-F. The financialstatements have been prepared in accordance with U.K. GAAP which differs incertain significant respects from U.S. GAAP. You can find a description of thesignificant differences between U.K. GAAP and U.S. GAAP and reconciliations innote 13 of the notes to the financial statements.

 

The Company was incorporated onAugust 20, 1998 and had no operations prior to its issuance of the 2009 Noteson May 6, 1999.

 

***Profit and Loss Account***

 
|                                           |   | **As at 31  December,** |   |
|------------------------------------------------|--------|-------------------------|--------|
|                                           |   | **1999**                |   | **2000** |   | **2001** |   | **2002** |   |
|                                           |   | **£**              |   | **£** |   | **£** |   | **£** |   |
| Interest  receivable and similar income        |   | 21,783,726              |   | 44,665,846 |   | 86,248,879 |   | 88,695,480 |   |
| Foreign  exchange (losses)/gains, net          |   | 29                      |   | (11,678 | ) | (307 | ) | 9,941 |   |
| Interest  payable and similar charges          |   | (21,767,451             | )      | (44,620,397 | ) | (86,189,430 | ) | (88,629,172 | ) |
|                                           |   |                    |   |   |   |   |   |   |   |
| Profit  on ordinary activities before taxation |   | 16,304                  |   | 33,771 |   | 59,142 |   | 76,249 |   |
| Tax  on profit on ordinary activities          |   | —                  |   | — |   | (17,743 | ) | (9,335 | ) |
|                                           |   |                    |   |   |   |   |   |   |   |
| Profit  on ordinary activities after taxation  |   | 16,304                  |   | 33,771 |   | 41,399 |   | 66,914 |   |
| Dividend                                       |   | —                  |   | — |   | (75,000 | ) | (74,997 | ) |
|                                           |   |                    |   |   |   |   |   |   |   |
| Retained  profit for the period                |   | 16,304                  |   | 33,771 |   | (33,601 | ) | (8,083 | ) |

 

***Statement of Recognized Gains and Losses***

 
|                                                          |   | **As at 31  December,** |   |
|---------------------------------------------------------------|--------|-------------------------|--------|
|                                                          |   | **1999**                |   | **2000** |   | **2001** |   | **2002** |   |
|                                                          |   | **£**              |   | **£** |   | **£** |   | **£** |   |
| Profit  for the financial period                              |   | 16,304                  |   | 33,771 |   | 41,399 |   | 66,914 |   |
| Revaluation  of equity value certificates due from Cableuropa |   | 7,183,992               |   | (3,567,713 | ) | 39,586,078 |   | (30,535,128 | ) |
| Revaluation  of equity value certificates due to bondholders  |   | (7,183,992              | )      | 3,567,713 |   | (39,586,078 | ) | 30,535,128 |   |
|                                                          |   |                    |   |   |   |   |   |   |   |
|                                                          |   | 16,304                  |   | 33,771 |   | 41,399 |   | 66,914 |   |

 

1

----

 

**Balance Sheet**

 
|                                                     |   | **As at  December 31,** |   |
|----------------------------------------------------------|--------|-------------------------|--------|
|                                                     |   | **1999**                |   | **2000** |   | **2001** |   | **2002** |   |
|                                                     |   | **£**              |   | **£** |   | **£** |   | **£** |   |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Debtors:  receivable after more than one year            |   | 236,465,728             |   | 374,028,569 |   | 565,865,404 |   | 572,209,595 |   |
| Debtors:  receivable within one year                     |   | 20,289,928              |   | 26,135,308 |   | 108,582,822 |   | 59,931,601 |   |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Total  debtors                                           |   | 256,755,656             |   | 400,163,877 |   | 674,448,226 |   | 632,141,196 |   |
| Cash  at bank and in hand                                |   | 12,492                  |   | 12,475 |   | 23,863 |   | 85,745 |   |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Current  assets                                          |   | 256,768,148             |   | 400,176,352 |   | 674,472,089 |   | 632,226,941 |   |
| Creditors:  amounts falling due within one year          |   | (16,831,807             | )      | (22,436,726 | ) | (29,310,829 | ) | (28,978,215 | ) |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Net current assets                                       |   | 239,936,341             |   | 377,739,626 |   | 645,161,260 |   | 603,248,726 |   |
| Creditors:  amounts falling due after more than one year |   | 239,907,535             |   | (377,677,049 | ) | (645,132,284 | ) | (603,227,833 | ) |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Net  assets                                              |   | 28,806                  |   | 62,577 |   | 28,976 |   | 20,893 |   |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Capital  and Reserves                                    |   |                    |   |   |   |   |   |   |   |
| Called  up share capital                                 |   | 12,502                  |   | 12,502 |   | 12,502 |   | 12,502 |   |
| Profit  and loss account                                 |   | 16,304                  |   | 50,075 |   | 16,474 |   | 8,391 |   |
|                                                     |   |                    |   |   |   |   |   |   |   |
| Equity  shareholders’ funds                         |   | 28,806                  |   | 62,577 |   | 28,976 |   | 20,893 |   |

 

**U.S. GAAP Data:**

** **
|                       |   | **As at  December 31,** |   |
|----------------------------|--------|-------------------------|--------|
|                       |   | **1999**                |   | **2000** |   | **2001** |   | **2002** |   |
|                       |   | **£**              |   | **£** |   | **£** |   | **£** |   |
|                       |   |                    |   |   |   |   |   |   |   |
| Net  income/(loss)         |   | 16,304                  |   | 33,771 |   | 41,399 |   | 66,914 |   |
| Shareholders’  equity |   | 16,304                  |   | 62,577 |   | 103,976 |   | 95,890 |   |

 

**Exchange Rates**

 

For your convenience, thisAnnual Report contains certain translations of the pound into U.S. dollarsbased on the noon buying rate. The noon buying rate is the noon buying rate inNew York City for cable transfers in foreign currencies as certified forcustoms purposes by the Federal Reserve Bank of New York. The table belowprovides, for the periods indicated, the period-end, average, high and lowexchange rates between the pound and the U.S. dollar, expressed in dollars perpound, based on the noon buying rate. These rates have been provided for yourconvenience and they are not the exchange rates used to prepare the financialstatements included in this Annual Report. On May 20, 2003, the noon buyingrate was £1.00 = U.S.$1.6393.

 
| **Year ended December 31,** |   | **High**                |   | **Low** |   | **Average Rate(1)** |   | **End of Period** |   |
|-----------------------------|--------|-------------------------|--------|---------|--------|---------------------|--------|-------------------|--------|
|                        |   | **(dollars per pound)** |   |
| 2002                        |   | 1.6095                  |   | 1.4074  |   | 1.5084              |   | 1.6095            |   |
| 2001                        |   | 1.5045                  |   | 1.3730  |   | 1.4418              |   | 1.4543            |   |
| 2000                        |   | 1.6765                  |   | 1.4514  |   | 1.5667              |   | 1.4515            |   |
| 1999                        |   | 1.7222                  |   | 1.5515  |   | 1.6303              |   | 1.6086            |   |
| 1998                        |   | 1.7035                  |   | 1.5827  |   | 1.6550              |   | 1.6760            |   |

 

----

(1)                                  The average rates for each period reflect theaverage of the noon buying rates on the last business day of each month duringthe relevant period.

 

2

----

 

Thetable below sets forth the high and low exchange rates between the pound andthe dollar expressed in dollars per pound, for the six months ending April 30,2003.

 

|     |   | **High**                     |   | **Low** |   |
|----------|--------|------------------------------|--------|---------|--------|
|     |   | **(U.S. dollars per pound)** |   |
|     |   |                         |   |    |   |
| **2003** |   |                         |   |    |   |
| April    |   | 1.6000                       |   | 1.5500  |   |
| March    |   | 1.6129                       |   | 1.5624  |   |
| February |   | 1.6480                       |   | 1.5727  |   |
| January  |   | 1.6482                       |   | 1.5975  |   |
|     |   |                         |   |    |   |
| **2002** |   |                         |   |    |   |
| December |   | 1.6095                       |   | 1.5555  |   |
| November |   | 1.5915                       |   | 1.5440  |   |

 

**Risk Factors**

 

*Ourbusiness, our ability to pay the principal and interest on the Notes and anydecision by security holders are subject to a number of significant risks,including those described below.  Theserisks are not the only ones associated with our business or the Notes.Additional risks not known to us at present or that we currently deemimmaterial may also impair our business operations and our ability to pay theprincipal and interest on the Notes.*

 

***We are a financing entity with noadditional operations***

 

The Company is a financingentity with no business operations other than the issuance of debt securities,including the Notes and the lending of the proceeds of such offerings toCableuropa and the other Note Guarantors under the multi-borrower creditfacilities, or similar agreements in the future. We will rely on payments theNote Guarantors must make under the multi-borrower credit facilities to providethe funds necessary for us to pay principal and interest on the Notes and topay our other expenses. Therefore, we are subject to all risks to whichCableuropa and the other Note Guarantors are subject, to the extent such riskscould limit their ability to satisfy their obligations under the multi-borrowercredit facilities.

 

For a discussion of other risk factors affecting theNotes and the operations of the business of the Note Guarantors, see Item 3.D. “Key Information—Risk Factors” ofthe Cableuropa Annual Report.

 

**Item 4****.  Information on the Company**

 

**History and Development of the Company**

 

The Company was incorporated on August 20, 1998 as apublic limited company with limited liability under the laws of England andWales. Our registered office is at 200 Aldersgate Street, London EC1A 4JJ,England and our phone number is +44 20 7600 1000.  We are registered as a company with the Registrar of Companiesfor England and Wales with company number 3619149. Our authorized and issuedshare capital is £50,000 divided into 50,000 ordinary shares with a par valueof one pound each, of which two fully-paid shares and 49,998 shares paid up toone quarter have been issued.

 

3

----

 

**Business Overview**

 

Our principal purpose is tofinance the business operations of Cableuropa and its subsidiaries. We haveconducted no other operations since we were established and will have nosubsidiaries or significant businesses other than the issuance of debtsecurities and are not expected to produce any income except for paymentsreceived from Cableuropa and its subsidiaries under the multi-borrower creditfacilities.  For more information onCableuropa’s business operations, see Item 4 of the Cableuropa Annual Report.

 

**Organizational Structure**

 

ONO Finance (Holdings) Limited(“ONO Holdings”), an English private limited company, holds 98% and Cableuropaholds the remaining 2% of the share capital of the Company. ONO Holdings has ashare capital of one pound consisting of a single share of par value of onepound and its sole shareholder is Royal Exchange Trust Company Limited, aprofessional trust corporation which holds this share under the terms of anEnglish law charitable trust.

 

**Property, Plant and Equipment**

 

We do not own, lease, orotherwise occupy any property.

 

**Legal Proceedings**

 

We are currently not party to any legal proceedings.

 

**Item 5****.  Operating and Financial Review and Prospects**

 

**CriticalAccounting Policies**

 

We prepare our financial statements in accordance withU.K. GAAP with reconciliations to U.S. GAAP included.  The preparation of financial statements in conformity with U.K.GAAP requires the use of estimates and assumptions that affect the reportedamounts of assets and liabilities, including disclosure of contingent assetsand contingent liabilities, at the date of the financial statements and thereported amounts of revenue and expenses during the reporting period.  Because of the uncertainty of factorssurrounding the estimates or judgments used in the preparation of the financialstatements, actual results may vary from these estimates.

 

For a summary of all of our significant accountingpolicies, including the critical accounting policies discussed below, see note1, Accounting Policies, to our financial statements.

 

***Loans***

 

Borrowings are included as liabilities in the balancesheet at their proceeds, net of discount and expenses. The expenses anddiscount are charged to loan interest in the profit and loss account over theterm of the borrowing, using the effective interest method.  Funds on lent to Cableuropa and itssubsidiary companies are accounted for in exactly the same manner in order tomatch the borrowing and the debtor treatment.

 

4

----

 

***Finance costs***

 

Finance costs on borrowings are recognized in theprofit and loss account over the term of such instruments at a constant rateover the period of the instrument.

 

***Foreign exchange***

 

Transactions in foreign currencies are translated intoBritish pounds sterling at the rates of exchange current at the dates of thetransactions. Foreign currency monetary assets and liabilities in the balancesheet are translated into sterling at the rates of exchange ruling at the endof the year. The resulting gain or loss is included as an exchange gain or lossin the profit and loss account.

 

**Results of Operations**

 

The Company is a financing entity whose principalbusiness is to finance the business operations of Cableuropa and itssubsidiaries.  We have conducted noother operations since we were established and expect not to have subsidiariesor significant businesses other than the issuance of debt securities and arenot expected to provide any income except payments received from Cableuropa andits subsidiaries under the multi-borrower credit facilities. Our only recentsignificant business event was the cancellation on February 13, 2003 of asignificant portion of the Notes which we acquired from Cableuropa in exchangefor (i) the cancellation of an equivalent principal amount of indebtednessunder the relevant multi-borrower credit facilities, (ii) certain amendments tothe multi-borrower credit facilities and (iii) a one-off fee of £93,000 payableto ONO Holdings and an arrangement fee payable to ONO Holdings annually tocompensate for the reduction of our net margin before expenses from theborrowing under the Notes and on-lending to Cableuropa under the multi-borrowercredit facilities.

 

After cancellation of the Notes purchased, thefollowing Notes remain outstanding:

 
|                   |   | **Original issue  (thousand)** |    | **Notes cancelled on  February 13, 2003   (thousand)** |   | **Remaining issue  (thousand)** |   |
|------------------------|--------|--------------------------------|---------|--------------------------------------------------------|--------|---------------------------------|--------|
|                   |   |                           |    |                                                   |   |                            |   |
| EUR 13% Notes due 2009 |   | €                         | 125,000 |                                                   | € | 79,372                          |   | € | 45,628 |   |
| USD 13% Notes due 2009 |   | $                              | 275,000 |                                                   | $      | 182,902                         |   | $ | 92,098 |   |
| EUR 14% Notes due 2010 |   | €                         | 200,000 |                                                   | € | 86,298                          |   | € | 113,702 |   |
| EUR 14% Notes due 2011 |   | €                         | 150,000 |                                                   | € | 37,947                          |   | € | 112,053 |   |
| USD 14% Notes due 2011 |   | $                              | 200,000 |                                                   | $      | 116,486                         |   | $ | 83,514 |   |

 

Previously, our only significant business events wereour issuance of the 2011 Notes on February 9, 2001, our issuance of the 2010Notes on June 30, 2000, and our issuance of the 2009 Notes on May 6, 1999.  We conducted no operations in 1998 or in anyearlier period.  We believe that ourcurrent working capital is sufficient for our present requirements.

 

For a discussion on theoperating and financial review and prospects of the ONO Group and Cableuropa’ssubsidiaries, see Item 5. “Operating and Financial Review and Prospects” ofCableuropa’s Annual Report.

 

5

----

 

**Item 6****.  Directors, Senior Management and Employees**

 

**Directors**

 

The following table showsinformation regarding our directors:

 
| **Name**              |   | **Age** |   | **Title** |   | **Member of  Board  of Director Since** |   | **Termination** |   |
|-----------------------|--------|---------|--------|-----------|--------|-----------------------------------------|--------|-----------------|--------|
| Bryan  Donald Needham |   | 61      |   | Director  |   | 1999                                    |   | 2009            |   |
| Peter  Michael Hills  |   | 49      |   | Director  |   | 2000                                    |   | 2009            |   |

 

**Bryan Donald Needham**, is a Director ofCapita IRG Trustees Limited and its subsidiary, Royal Exchange Trust Company Limited, which administer a widerange of Corporate Trusts including securitizations.  Mr. Needham is a Director of a number of Companies through theinvolvement of Capita IRG Trustees Limited in securitizations (see below).

 

**Peter Michael Hills**, is a Manager of CapitaIRG Trustees Limited and its subsidiary, RoyalExchange Trust Company Limited, which administer a wide range ofCorporate Trusts including securitizations. Mr. Hills is a Director of a number of Companies through the involvementof Capita IRG Trustees Limited in securitizations (see below).

 

The following table shows information regarding themain activities currently undertaken by our directors outside the Company:

 

| **Name**             |   | **Main  Activities outside ONO Finance**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|----------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Bryan Donald Needham |   | Mr. Needham serves as a  director for the following companies: Gracechurch Mortgage Finance (No.3)  Plc, Gracechurch Mortgage Trustee (No.1) Limited, Gracechurch Mortgage  Trustee (No.2) Limited, Prospect 1 Receivables Trustee Limited, Prospect  Heights (Holdings) Limited, Prospect 1 Plc, Residential Property Securities  No.4 Plc, East West Holdings Limited, Maple Mortgage Holdings Limited, Maple  Mortgage Securities No.1 Plc, Guaranteed Export Finance Corporation Plc,  First Securitisation Company Limited, Gracechurch Mortgage Finance Plc, GRE  Trust Company (Ireland) Limited, Gracechurch Mortgage Finance (No.2) Plc,  Gracechurch Mortgage (Holdings) Limited, Gracechurch Receivable (Holdings)  Limited, Gracechurch Receivable Trustee Limited, Gracechurch Personal Loan  Finance (No.1) Plc, Lothbury Funding No.1 Plc, Sarfu Limited, Residential  Property Securities No.3 Plc, L.A.B Investments Plc, L.A.B Investments  (Holdings) Limited, Royal Exchange Trust Company (Jersey) Limited, Interm  Limited, HGV Co. Limited, Framleypark Limited, Framleyhurst Limited, Royal  Exchange Trust Company (Guernsey) Limited, Prospect 2 Receivables Trustee  Limited, Prospect 2 Plc, Merrion Square (Holdings) Limited, Ireland  Residential Securitised Home Mortgages (No.1) Plc, Thames Asset Global  Securitisation No.1 PLC, Prospect 3 plc, Prospect 3 Receivables Trustee  Limited, Residential Mortgage Securities Limited, Residential Mortgage  Securities No 1 plc, Residential Mortgage Securities Options, Housing  Association Finance Corporation No 1 plc, H A Funding Limited, Finance for  Residential Social Housing (Holdings) Limited, Finance For Residential Social  Housing plc, Orchardbrook Limited, Residential Mortgage Securities 2 plc, RMS  2 Limited, RMS 2 Options Limited, Opus Master Receivables Trustee Limited,  Opus Series 1 Plc, Residential Property Securities No.5 PLC, Royal Exchange  Trust Company (BG) Limited, Aire Valley Finance Plc, Residential Mortgage  Securities 3 plc, RMS 3 Limited, RMS 3 Options Limited, Spicedeck Limited,  Mortgage Express Hldgs, Mortgage Express No.2, HSMS, Silhouette Mortgages  Ltd, Finance for Mortgages Limited, Scotlife Home Loans (No.2) Limited,  Orvieto Limited, Burra Limited, The Money Store Sterling No.1 plc, The Higher  Education Securitised Investment Series No.1 plc, Finance For Higher  Education Limited, The Higher Education Securitized Investments Series  (Holdings) Limited, Southern Pacific Securities A plc, Southern Pacific A  Ltd, SP Options Limited, RMS 4 Options Limited, RMS 4 Limited, Residential  Mortgage Securities 4 plc, Meridian VAT Trustees Limited, Royal Exchange  Trust Company (BPP) Limited, Leek Finance Number Two plc, Prospect 4 Plc,  Prospect 4 Receivables Trustee Limited, FAB |

 

6

----

 

|                |   | Funding (UK) Limited,  Hotel Securitisation Holdings Limited, Hotel Securitisation, (No 1) Plc,  Wisteria Finance Limited, RMS 5 Limited, Residential Mortgage Securities 5  plc, Southville Funding Limited, RSL Finance (No 1) plc, Leek Finance  Holdings Number Two Limited, Royal Exchange Trust Company (AOC) Limited, RSL  Finance Holdings Limited, Royal Exchange Trustee Nominees Limited, RMS 5  Options Limited, ONO Finance (Holdings) Limited, Non-Conforming Mortgages 1  plc, Morgan Stanley Mortgage Finance (Broadgate) PLC, Tussauds Finance  Limited, Residential Mortgage Securities 6 plc, RMS 6 Limited, RMS 6 Options  Limited, Investors Finance Company PLC, Investors Finance Company (Holdings)  Limited, Southern Pacific Securities C plc, Southern Pacific B Limited,  City Aviation Limited, Mortgages No1 (Holdings) Limited, Mortgages No1  (Options) Limited, Mortgages No1 plc, Mortgages No1 (Notes) Limited,  Residential Mortgage Securities 7 Plc, RMS 7 Limited, RMS 7 Options Limited,  Platform Home Loans Holdings Ltd, Platform Home Loans Options Ltd, St James’  Park Limited, Zincor Limited, Gracechurch Card (Holdings) Limited,  Gracechurch Card Funding (No.1) PLC, Platform Home Loans No.1 PLC, Millennium  Link Trust, Barclaycard Funding PLC, Leek Finance Number Four Limited, Leek  Finance Holdings Number Four Limited, Leek Finance Number Three Limited, Leek  Finance Holdings Number Three Limited, Prospect 5 plc, Prospect 5 Receivables  Trustee Limited, Winkfield Funding plc, Tussauds Intermediate Holdings  Limited, Residential Mortgage Securities 8 plc, RMS 8 Limited, RMS 8 Options  Limited, Gallaher Asset Finance 2000, Capita IRG Trustees (Nominees) Limited,  Capita IRG Trustees Limited, Monument Securitisation No1 Plc, Monument  Options No1 Limited, Monument MT No1 Limited, Monument Securitisation Holdings  Limited, Residential Mortgage Securities 9 Plc, RMS 9 Limited, RMS 9 Options  Limited, Platform Home Loans Options No2 Limited, Platform Home Loans  Holdings No 2 Limited, Platform Home Loans No 2 Plc, Mortgages No2 Dacs  Limited, Mortgages No 2 (Options) Limited, Mortgages No 2 (Holdings) Limited,  Mortgages No 2 Plc, Aire Valley Trustees (No 2) Limited, Aire Valley Finance  (No 2) plc, Prospect 6 plc, Prospect 6 (Jersey) Limited, RMS 10 Limited, RMS  10 Options Limited, Residential Mortgage Securities 10 plc, Werretown  Supermarkets Securitisations Plc, Werretown Supermarkets Securitisations  (Holdings) Limited, Leek Finance Number Five Limited, Leek Finance Holdings  Number Five Limited, Leek Finance Holdings Number Six Limited, Leek Finance  Number Six Limited, Mortgages No 3 (Holdings) Ltd, Mortgages No 3 (Options)  Ltd, Mortgages No 3 (APC) Ltd, GHG Finance Limited, Royal Exchange Trust  Company Limited, RMS 11 Limited, RMS 11 Options Limited, Residential Mortgage  Securities 11 PLC, Leek Finance Number 7 Ltd, Leek Finance Holdings Number 7  Ltd, Meadowhall CMR Finance plc, Meadowcroft CMR Holdings Limited,  Residential Mortgage Securities 12 PLC, RMS 12 Options Limited, RMS 12  Limited, Leek 9 Holdings Limited, Leek 9 Plc, Leek 8 Holdings Limited, Leek 8  Plc, Southern Pacific Securities D Plc, Southern Pacific D Parent Limited,  Monument Securitisation Holdings No2 Limited, Monument Post Enforcement No2  Limited, Monument Securitisation (CMBS) No2 Limited, Monument MT No2 Limited,  Securitisation of Financial Assets Limited, Artesian Finance PLC, Artesian  Options Limited, Dee Valley Water (Holdings) Limited, Portsmouth Water  Holdings Limited, Leek Finance Holdings Number Eleven Limited, Leek Finance  Number Eleven Limited, Rudyard Finance Number One PLC, Rudyard Finance Holdings  Number One Limited, Lynchwood Mortgages No 1 Limited, Southern Pacific  Securities E Plc, Southern Pacific E Parent Limited, Mortgages No 4 Plc,  Mortgages No 4 Dacs Limited, Mortgages No 4 Holdings Limited, Mortgages No 4  Options Limited, Kyndal Finance Limited, Southern Pacific Securities F Plc,  Southern Pacific F Parent Limited, RMS 14 Limited, RMS 14 Options Limited,  Residential Mortgage Securities Plc, Mortgages No 5 Plc, Mortgages No 5 Dacs  Limited, Mortgages No 5 Holdings Limited, Mortgages No 5 Options Limited,  Southern Pacific Securities G Plc, Southern Pacific G Parent Limited, Leek  Finance Holdings Number Twelve Limited and Leek Finance Number Twelve  Limited. |
|---------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Peter Michael Hills |   | Mr. Hills serves as a  director for the following companies: Prospect 3 plc, Prospect 3 Receivables  Trustee Limited, Prospect Heights (Holdings) Limited, Prospect 1 Receivables  Trustee Limited, Prospect 1 plc, Prospect 2 plc, Prospect 2 Receivables  Trustee Limited, Prospect 5 plc, Prospect 5 Receivables Trustee Limited,  Winkfield Funding Plc, Prospect 4 Receivables Trustee Limited, Prospect 4  Plc, Opus Series 1 plc, Opus Master Receivables Trustee Limited, East West  Holdings Limited, Gallaher Asset Finance 2000 Limited, St James’ Park Finance  Limited, Housing Association Funding PLC, H A Funding Limited, Investor  Finance Company PLC, Investors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

 

7

----

 

|   |   | Finance Company  (Holdings) Limited, Aire Valley Finance Plc, Spicedeck Limited, RMS 8  Limited, Residential Mortgage Securities 8 plc, RMS 8 Options Limited,  Residential Mortgage Securities 1 plc, RMS Options Limited, Residential  Mortgage Securities Limited, RMS 2 Limited, RMS 2 Options Limited,  Residential Mortgage Securities 2 plc, Residential Mortgage Securities 3 plc,  RMS 3 Options Limited, RMS 3 Limited, RMS 4 Limited, RMS 4 Options Limited,  Residential Mortgage Securities 4 plc, RMS 5 Options Limited, RMS 5 Limited,  Residential Mortgage Securities 5 plc, RMS 6 Options Limited, Residential  Mortgage Securities 6 plc, RMS 6 Limited, RMS 7 Options Limited, Residential  Mortgage Securities 7 plc, RMS 7 Limited, Platform Home Loans Holdings Ltd,  Platform Home Loans Options Limited, Platform Home Loans No1 Plc, L.A.B.  Investments Plc, L.A.B Investments (Holdings) Limited, Plum Sterling No. 1  Plc, Leek Finance Number Two plc, Leek Finance Holdings Number Two Limited,  Leek Finance Number Three Limited, Leek Finance Holdings Number Three  Limited, Leek Finance Number Four Limited, Leek Finance Holdings Number Four  Limited, Finance for Residential Social Housing (Holdings) Limited, Finance  For Residential Social Housing plc, Orchardbrook Limited, Thames Asset Global  Securitisation No 1 PLC, The Higher Education Securitised Investment Series  No 1 plc, Finance For Higher Education Limited, The Higher Education  Securitised Investments Series (Holdings) Limited, RSL Finance (No 1) plc,  RSL Finance Holdings Limited, Non-Conforming Mortgages 1 plc, Residential  Property Securities No.3 Plc, Residential Property Securities No.4 Plc,  Residential Property Securities No.5 Plc, Morgan Stanley Mortgage Finance  (Broadgate) PLC, Southern Pacific A Limited, SP Options Limited, Southern  Pacific Securities A plc, Southern Pacific Securities C plc, Southern Pacific  B Limited, Non Conforming Mortgages 1 Plc, ONO Finance (Holdings) Limited,  Guaranteed Export Finance Corporation Plc, First Securitisation Company  Limited, Gracechurch Receivable (Holdings) Limited, Gracechurch Receivable  Trustee Limited, Gracechurch Mortgage Finance Plc, Gracechurch Mortgage (Holdings)  Ltd, Gracechurch Personal Loan Finance (No.1) Plc, Gracechurch Mortgage  Trustee (No 1) Limited, Gracechurch Card (Holdings) Limited, Gracechurch Card  Funding (No 1) PLC, Gracechurch Mortgage Trustee (No 2) Limited, Gracechurch  Mortgage Finance (No 2) Plc, Gracechurch Mortgage Finance (No 3) Plc,  Barclaycard Funding PLC, Monument Securitisation No1 Plc, Monument Options  No1 Limited, Monument MT No1 Limited, Monument Securitisation Holdings  Limited, FAB Funding (UK) Limited, Framleyhurst Limited, Framleypark Limited,  HGV Co. Limited, Interm Limited, Residential Mortgage Securities 9 Plc, RMS 9  Limited, RMS 9 Options Limited, Hotel Securitisation Holdings Limited, Hotel  Securitisation (No 1) plc, Platform Home Loans Options No2 Limited, Platform  Home Loans Holdings No 2 Limited, Platform Home Loans No 2 Plc, Mortgages No  2 Dacs Limited, Mortgages No 2 (Options) Limited, Mortgages No 2 (Holdings)  Limited, Mortgages No 2 Plc, Sarfu Limited, Aire Valley Finance (No 2) plc,  Aire Valley Trustees (No 2) Limited, Mortgages No1 (Holdings) Limited,  Mortgages No1 (Options) Limited, Mortgages No1 plc, Mortgages No1 (Notes)  Limited, Prospect 6 plc, Prospect 6 (Jersey) Limited, Maple Mortgage Holdings  Limited, Maple Mortgage Securities No.1 Plc, RMS 10 Limited, Residential  Mortgage Securities 10 plc, RMS 10 Options Limited, Werretown Supermarkets  Securitisations Plc, Werretown Supermarkets Securitisations (Holdings)  Limited, Leek Finance Number Five Limited, Leek Finance Holdings Number Five  Limited, Leek Finance Holdings Number Six Limited, Leek Finance Number Six  Limited, Mortgages No 3 (Holdings) Ltd, Mortgages No 3 (Options) Ltd,  Mortgages No 3 (APC) Ltd, RMS 11 Limited, RMS 11 Options Limited, Residential  Mortgage Securities 11 PLC, Leek Finance Number 7 Ltd, Leek Finance Holdings  Number 7 Ltd, Meadowhall CMR Finance plc, Meadowcroft CMR Holdings Limited,  Residential Mortgage Securities 12 PLC, RMS 12 Options Limited, RMS 12  Limited, Leek 9 Holdings Limited, Leek 9 Plc, Leek 8 Holdings Limited, Leek 8  Plc, Southern Pacific Securities D Plc, Southern Pacific D Parent Limited,  Monument Securitisation Holdings No 2 Limited, Monument Post Enforcement No 2  Limited, Monument Securitisation (CMBS) No 2 Limited, Monument MT No 2  Limited, Securitisation of Financial Assets Limited, Artesian Finance PLC,  Artesian Options Limited, Dee Valley Water (Holdings) Limited, Portsmouth  Water Holdings Limited, Leek Finance Holdings Number Eleven Limited, Leek  Finance Number Eleven Limited, Rudyard Finance Number One PLC, Rudyard Finance  Holdings Number One Limited, Lynchwood Mortgages No 1 Limited, Southern  Pacific Securities E Plc, Southern Pacific E Parent Limited, Mortgages No 4  Plc, Mortgages No 4 Dacs Limited, Mortgages No 4 Holdings Limited, Mortgages  No 4 Options Limited, Southern Pacific Securities F Plc, Southern Pacific F  Parent |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

8

----

 

|   |   | Limited, RMS 14  Limited, Mortgages No 5 Plc, Mortgages No 5 Dacs Limited, Mortgages No 5  Holdings Limited, Mortgages No 5 Options Limited, Southern Pacific Securities  G Plc, Southern Pacific G Parent Limited, Leek Finance Holdings Number Twelve  Limited and Leek Finance Number Twelve Limited. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

**Compensation**

 

For the year ended December 31,2002, the aggregate compensation of the directors and executive officers of theCompany consisted of a nominal administrative fee to Royal Exchange TrustCompany Limited.

 

**Board Practices**

 

There is no current provision toprovide compensation to our directors upon termination.

 

***Audit and Compliance Committee***

 

We do not have an audit andcompliance committee.  Our Board ofDirectors functions as our audit committee as defined in the Sarbanes-Oxley Act2002 and performs all acts necessary under that legislation.

 

As of December 31, 2002, theCompany had not adopted a code of ethics.

 

**Employees**

 

We do not have any employees.

 

**Item 7****. MajorShareholders and Related Party Transactions**

 

**Major Shareholders**

 

ONO Holdings, an English private limited company,holds 49,991 shares, or 98%, and Cableuropa holds the remaining two percent ofour share capital. ONO Holdings has a share capital of one pound consisting ofa single share of par value one pound and its sole shareholder is Royal Exchange Trust Company Limited, aprofessional trust corporation which holds this share under the terms of anEnglish law charitable trust.

 

ONO Holdings’ articles of association and itsmemorandum of association:

 

•                                          limitONO Holdings’ activities to borrowing funds from Cableuropa to purchase andhold shares of the Company, as well as other activities incidental thereto;

 

•                                          prohibitthe transfer of ONO Holdings’ shares to any party other than to Royal Exchange Trust Company Limited, tobe held under the terms of the charitable trust, or to Cableuropa;

 

•                                          prohibitthe transfer of the issuer’s shares held by ONO Holdings to any party otherthan Royal Exchange Trust Company Limited,or Cableuropa; and

 

•                                          prohibitONO Holdings from issuing any securities, other than the initial issuance ofits share capital to Royal Exchange TrustCompany Limited, or

 

9

----

 

otherwise to incur anyindebtedness, other than a loan from Cableuropa sufficient to cover the costsof purchasing the shares of the issuer and costs incidental to the maintenanceof ONO Holdings and the Company.

 

**Related Party Transactions**

 

***Multi-Borrower Credit Facilities***

 

Weand the Note Guarantors have entered into the multi-borrower credit facilities,pursuant to which we have lent to the Note Guarantors (the borrowers), anamount equal to the gross proceeds of the offering of each of our Notes. Aportion of the gross proceeds of the offering of each of our Notes has beenapplied, on the instructions of the borrowers, to pay us an up-front fee, whichenabled us to pay the fees and commissions and other expenses of the relevantoffering. The borrowers have appointed Cableuropa to act as their agent inconnection with the multi-borrower credit facilities.

 

OnFebruary 13, 2003, we purchased from Cableuropa (and other borrowers under themulti-borrower credit facilities) and redeemed at face value an aggregateprincipal amount of our outstanding Notes of approximately €503 million inconsideration for (i) the cancellation of an equivalent principal amount ofindebtedness under the relevant multi-borrower credit facilities, (ii) certainamendments to the multi-borrower credit facilities and (iii) a one-off fee of£93,000 payable to ONO Holdings and an arrangement fee payable to ONO Holdingsannually to compensate for a reduction of our net margin before expenses fromthe borrowing under the Notes and on-lending to Cableuropa under themulti-borrower credit facilities.

 

*Principal, Maturity and Interest*

 

Themulti-borrower credit facilities specify the amount of initial loans providedon the closing date to the borrowers. Thereafter, at Cableuropa’s discretion asagent, loans may be prepaid by a borrower so long as such amount is reborrowedimmediately by another borrower. Amounts drawn under the multi-borrower creditfacilities accrue interest at fixed rates which substantially mirror interestaccrued on the Notes. Amounts due under the multi-borrower credit facilitieswill be payable by the borrowers to us in order that we, upon receipt of suchamounts, will be able to satisfy our obligations to pay principal and intereston the Notes. Amounts due under the multi-borrower credit facilities arepayable to us concurrently with our obligations to make payments in respect ofthe Notes. Accordingly, the multi-borrower credit facilities contain provisionsthat match the optional and compulsory redemption provisions contained in theindentures. In addition, the multi-borrower credit facilities provide for anarrangement fee to be charged to the borrowers by ONO Holdings out of which ONOHoldings will pay our corporate maintenance and other expenses. Themulti-borrower credit facilities also provide for the payment of suchadditional amounts as may be necessary so that the net amount we receive willnot be less than amounts which we are entitled to receive if certain taxes orother payments were not required.

 

*Joint and Several Liability of theBorrowers*

 

Under the multi-borrower creditfacilities, the borrowers are jointly and severally liable to us to payprincipal, interest and any other amounts due.

 

10

----

 

***Additional Related Party Transactions***

 

As discussed in Item 5., ourprincipal purpose is to finance the business operations of Cableuropa and itssubsidiaries.  Our related partytransactions include the purchase from Cableuropa of a significant portion ofthe 2009 Notes, the 2010 Notes and the 2011 Notes; the equivalent reduction inthe debt owed to us by Cableuropa and certain of the Note Guarantors; and thepayment by Cableuropa to ONO Holdings of an annual fee and a one-off fee of£93,000 payable to ONO Holdings. For more information on these transactions,see Item 5. “Operating Financial Review and Prospects—Results of Operations” ofthis report and Item 10. “Additional Information—Material Contracts” of theCableuropa Annual Report.

 

***Interests of Experts and Counsel***

 

Not applicable.

 

***Sarbanes-Oxley Act of 2002***

 

As the Company has only registered its Notes under the U.S.Securities Act of 1933 (and not the U.S. Securities Exchange Act of 1934) andhas, to the best of our knowledge, fewer than 300 U.S. security holders ofrecord, it is not considered an “Issuer” for purposes of the Sarbanes-OxleyAct.  Therefore, certain provisions ofthe Sarbanes-Oxley Act do not apply to the Company. However, the Company isobligated under the indentures relating to its Notes to file its reports inaccordance with the requirements of Form 20-F. Therefore, although the Company is not statutorily obligated to comply with certain provisions of theSarbanes-Oxley Act, it has chosen to comply with certain provisions inconnection with the filing of its Form 20-F.

 

**Item 8****.  Financial Information**

 

For our financial information,please see the section entitled “Item 18. Financial Statements”.

 

**Item 9****.  The Offer and Listing**

 

**Markets**

 

The Notes trade on the Luxembourg Stock Exchange andare eligible to be traded in the Private Offerings, Resales, and Tradingthrough Automatic Linkages (“Portal”) Market.

 

**Item 10****.  Additional Information**

 

**Memorandum and Articles of Association**

 

***Objects and Purposes***

 

Our articles of association and memorandum ofassociation were adopted on February 3, 1999 and state that our purpose is to(and our activities are limited to) issue the Notes, or other debt securitiesin the future, and lend the proceeds of the Notes to the Note Guarantors, aswell as other activities relating to the issuance of the Notes and lending theproceeds of the Notes.

 

11

----

 

***Conflict-of-Interest Transactions***

 

Under the U.K. Companies Act 1985 (the “Act”), it isthe duty of a director who is in any way, whether directly or indirectly,interested in a contract or proposed contract with the company to declare thenature of that interest at a meeting of the directors of the company.  Such declaration shall be made at themeeting of directors at which the question of entering into the contract isfirst considered or, if the director is not at that time then interested, atthe next meeting of the directors held after becoming so interested.  This is backed up in our articles ofassociation.

 

Our articles of association further state that adirector may not vote on or be counted in the quorum in relation to resolutionsof the board or of the committee of the board concerning a contract,arrangement, transaction or proposal to which we are or are to be a party andin which we have an interest which is, to our knowledge, a material interestother than in certain specified circumstances.

 

***Election of Directors***

 

Directorsmay be appointed by ordinary resolution of the Company or by the board. A director appointed bythe board holds office only until the dissolution of the next annual generalmeeting after his appointment (unless he is reappointed during thatmeeting).  Our directors were appointedby ordinary resolution of the Company.

 

***Director Qualifications***

 

Our articles ofassociation provide that no person is incapable of being appointed a directorby reason of having reached the age of 70. This disapplies section 293 of the Act that provides that no person is capableof being appointed a director of a company if, at the time of the appointment,he has attained the age of 70. According to our articles of association, thedirectors are not required to hold our shares.

 

***Calling a Shareholders’ Meeting***

 

The directors are obligedto call an annual general meeting once in each calendar year.  Additionally, the board must convene anextraordinary general meeting immediately on receipt of a written request fromshareholders holding at least 10% of our shares, in accordance with the Act.

 

The directors are obligedto take action to convene the meeting within 21 days and the meeting must beheld within 28 days of the notice of meeting being sent out, *i.e.,*the maximum permitted delay between receipt of the requisition and day of themeeting is seven weeks.  If thedirectors do not take the required action the requisitionists themselves cancall their meeting and the meeting must take place within three months of thedate of the original request.

 

***Shareholders’ Meetings***

 

The directors are obligedto call an annual general meeting once in each calendar year.  Subject to any special terms as to voting onwhich shares have been allotted or issued, at a general meeting everyshareholder present in person has, on a show of hands, one vote.  Every

 

12

----

 

shareholder present in person or by proxy has, on a poll, one vote forevery share of which it is the holder.

 

The quorum for a general meeting is two shareholderspresent in person or by proxy and entitled to vote.

 

***Vote Required for Extraordinary Transactions***

 

Shareholders can act byordinary resolution (simple majority) unless required by the Act or ourarticles of association to pass another type of resolution.  The Act insists that for certain decisionsonly a certain type of resolution is adequate, *e.g.,* a special resolutionis needed to change the name or articles of association of a company.  A special resolution requires a 75% majorityto be passed.  This means that on such avote, by a show of hands, at least three quarters of the number of shareholderspresent must vote in favor, and by a poll, 75% of the votes of thoseshareholders or their proxies present and voting must be in favor of theresolution. The main occasion on which an extraordinary resolution is requiredoccurs when the shareholders wish to pass a resolution to put the company intovoluntary liquidation.

 

***Dividends***

 

Subjectto the provisions of the Act, we may by ordinary resolution declare dividendsto be paid to shareholders in accordance with their respective rights andinterests, provided that no dividend may exceed the amount recommended by theboard.

 

***Shareholder Actions by Written Consent***

 

Our articles ofassociation provide that a resolution in writing executed by or on behalf ofeach shareholder who would have been entitled to vote upon it if it had beenproposed at a general meeting at which he was present is as effective as if ithad been passed at a general meeting of the Company duly convened and held.

 

***Shareholders’ Proposals***

 

Under the Act anyshareholder(s) owning 5% or more of our shares has/have the right to have anitem placed on the agenda for an annual general meeting.  The request must be given to us in writingsix weeks prior to the annual general meeting. The requisition must be signed and left at our registered officetogether with a sum of money to cover our expenses (although the generalmeeting may later vote that this sum of money be returned).

 

***Voting Rights***

 

TheArticles include provisions to the following effect:

 

•                  on a show of hands every member at a generalmeeting who (being an individual) is present in person, or (being acorporation) is present by a representative, has one vote;

 

•                  on a poll every member present in person orby proxy or by representative has one vote for each share of which he is theholder; and

 

13

----

 

•                  in the case of joint holders, the vote ofthe person whose name stands first in the register of members and who tenders avote is accepted to the exclusion of any votes tendered by any other jointholders.

 

At a general meeting, aresolution put to the vote of the meeting is decided by a show of hands unless(before or on the declaration of the result of the show of hands) a poll isproperly demanded. Unless a poll is demanded and the demand is not withdrawn, adeclaration by the chairman that the resolution has been carried, or carried bya particular majority, or lost or not carried by a particular majority, isconclusive evidence of the fact without proof of the number or proportion ofthe votes recorded in favor of or against the resolution.

 

Subject to the Act, apoll may be demanded on any question by:

 

•                       thechairman of the meeting;

 

•                       notless than five members present in person or by proxy and entitled to vote;

 

•                       amember or members present in person or by proxy representing in aggregate notless than one-tenth of the total voting rights of all the members having theright to vote at the meeting; or

 

•                       amember or members present in person or by proxy holding shares conferring aright to vote at the meeting, being shares on which an aggregate sum has beenpaid up equal to not less than one-tenth of the total sum paid up on all theshares conferring that right.

 

***Limitations on Share Ownership***

 

Our articles ofassociation and memorandum of association prohibit the transfer of our sharesto any party other than ONO Holdings, RoyalExchange Trust Company Limited, to be held under the terms of thecharitable trust, or Cableuropa.

 

***Changes in Capital***

 

Wemay by way of ordinary resolution passed at our general meeting:

 

•                  increase our share capital by a sum to bedivided into shares of an amount prescribed by the resolution;

 

•                  consolidate and divide all or any of ourshare capital into shares of a larger amount;

 

•                  subject to the Act, sub-divide all or partof our shares into shares of a smaller amount and may by the resolution decidethat the shares resulting from the sub-division have among themselves apreference or other advantage or be subject to a restriction; and

 

•                  cancel any shares which have not, at thedate of the ordinary resolution, been taken or agreed to be taken by a personand diminish the amount of our share capital by the amount of the shares socancelled.

 

Subjectto the Act and the rights attached to existing shares, we may also:

 

14

----

 

•                  by special resolution, reduce our sharecapital, any capital redemption reserve or shares premium account; and

 

•                  subject to the requirements of the UKListing Authority, purchase, or agree to purchase in the future, our ownshares.

 

***Variation of Rights***

 

Subjectto the Act, whenever our share capital is divided into different classes ofshares, all or any of the rights for the time being attached to any class ofshares may be varied, as provided by those rights or, if there is no suchprovision, then either with the consent in writing of the holders of at leastthree-fourths in nominal value of the issued shares of that class or with thesanction of an extraordinary resolution passed at a separate general meeting ofthe holders of the issued shares of that class validly held in accordance withthe Articles. The rights attached to a class of shares are not, unlessotherwise expressly provided by those rights, deemed to be varied by thecreation, allotment or issue of further shares ranking equally with orsubsequent to them or by the purchase or redemption by us of our own shares inaccordance with the Act and the Articles.

 

**Material Contracts**

 

Fora discussion of the material contracts affecting the Company and the ONO Group, see Item 10 of the CableuropaAnnual Report on Form 20-F.

 

**Exchange Controls**

 

There are no foreign exchange controls currently in force that restrictthe import or export of capital or that affect the remittance of interest orother payments to holders of Notes who are non-residents of the United Kingdom.

 

There are no limitations relating to non-residents of the United Kingdomon the right to be a holder of, or to vote in respect of the Notes underEnglish law currently in force or in the Company’s memorandum or articles of association.

 

**Taxation**

 

The summaries set out below describe certain materialU.S. tax consequences of the acquisition, ownership and disposition of theunits, Notes and equity value certificates by a U.S. holder, as defined below,and certain material U.K. tax consequences of the acquisition, ownership anddisposition of the Notes. The statements regarding U.S. and U.K. tax laws andpractices set forth below, including the statements regarding the U.S./U.K.double taxation convention relating to income and capital gains assume that theunits, Notes and equity value certificates will be issued, and transfersthereof will be made, in accordance with the applicable indenture, theapplicable note depositary agreement and the applicable equity valuecertificate agreement.

 

For purposes of the U.S. Internal Revenue Code of1986, as amended to the date hereof, which we refer to as the Code, U.S. holdersof book-entry interests will be treated as owners of the Notes underlying suchbook-entry interests and, except as noted below, the tax consequences of owningbook-entry interests will be the same as those applicable to ownership

 

15

----

 

of Notes. However for U.K. tax purposes the tax consequences of owningbook-entry interests will not in all cases be the same as those applicable toownership of the Notes and it should not be assumed that the U.K. tax consequencesof ownership of the Notes set out below will apply equally to ownership ofbook-entry interests.

 

***United KingdomTaxation***

 

The following summary describes certain U.K. tax consequences of theownership of the Notes as of the date of filing this Form 20-F but does notpurport to be comprehensive and should be treated with appropriate caution. Itrelates only to the position of the persons who are the absolute beneficialowners of their Notes, and may not apply to special situations, such as those ofdealers in securities. Furthermore, the discussion below is based upon theprovisions of the U.K. tax laws and U.K. Inland Revenue practice as of the dateof this Annual Report, and such provisions may be repealed, revoked or modified(possibly with retrospective effect) so as to result in U.K. tax consequencesdifferent from those discussed below. Persons considering the purchase,ownership or disposition of Notes should consult their tax advisers concerningU.K. tax consequences in the light of their particular situations as well asany consequences arising under the law of any other relevant tax jurisdiction.No representations with respect to the tax consequences to any particularholder of Notes are made hereby.

 

*WithholdingTax on Interest on the Notes*

 

The Notes will constitute “quoted Eurobonds”, provided they are andcontinue to be listed on a “recognized stock exchange” within the meaning ofsection 841 of the U.K. Income and Corporation Taxes Act 1988 (the LuxembourgStock Exchange is currently so recognized). Accordingly, if the Notes are andcontinue to be quoted Eurobonds, payments of interest on the Notes may be madewithout withholding for or on account of U.K. income tax.

 

In other cases, an amount on account of U.K. income tax at the lower rate(currently 20%) may be withheld from interest payments, subject to such reliefas may be available under the provisions of any applicable double taxationtreaty.

 

*WithholdingTax on Payments by Note Guarantors*

 

If any of the Note Guarantors makes any payments in respect of intereston Notes (or other amounts due under such Notes other than the repayment ofamounts subscribed for the Notes) such payments may be subject to U.K.withholding tax at the basic rate (currently 22%), subject to such relief as maybe available under the provisions of any applicable double taxationtreaty.  Such payments by the NoteGuarantors may not be eligible for the “quoted Eurobond” exemption describedabove.

 

*Provision of Information*

 

Noteholders should notethat where any interest on Notes is paid to them (or to any person acting ontheir behalf) by the issuer or any person in the United Kingdom acting onbehalf of the issuer (a “paying agent”), or is received by any person in theUnited Kingdom acting on behalf of the relevant noteholder (other than solelyby clearing or arranging the clearing of a check) (a “collecting agent”), thenthe issuer,****the paying agent or the collecting agent (as the case may be)may, in certain cases, be required to supply to the United Kingdom InlandRevenue details of the payment and certain details relating to the noteholder(including

 

16

----

 

the noteholder’s name and address). These provisions will apply whetheror not the interest has been paid subject to withholding or deduction for or onaccount of United Kingdom income tax and whether or not the noteholder isresident in the United Kingdom for United Kingdom taxation purposes.  Where the noteholder is not so resident, thedetails provided to the United Kingdom Inland Revenue may, in certain cases, bepassed by the United Kingdom Inland Revenue to the tax authorities of thejurisdiction in which the noteholder is resident for taxation purposes.

 

For the abovepurposes, “interest” should be taken, for practical purposes, as includingpayments made by a guarantor in respect of interest on Notes.

 

The provisionsreferred to above may also apply, in certain circumstances, to payments made onredemption of any Notes where the amount payable on redemption is greater thanthe issue price of the Notes.

 

*Other RulesRelating to U.K. Withholding Tax on the Notes*

 

Where Notes are to be, or may fall to be, redeemed at a premium, asopposed to being issued at a discount, then any such element of premium may constitutea payment of interest.   Payments ofinterest are subject to U.K. withholding tax and reporting requirements asoutlined above.

 

Where interest has been paid under deduction of United Kingdom incometax, holders who are not resident in the U.K. may be able to recover all orpart of the tax deducted if there is an appropriate provision in any applicabledouble taxation treaty.

 

The above description of the U.K. withholding tax position assumes thatthere will be no substitution of the issuer and does not consider the taxconsequences of any such substitution.

 

Any discount element on Notes issued at an issue price of less than 100%of their principal amount will not be subject to any U.K. withholding taxpursuant to the provisions mentioned above, but may be subject to the provisionof information requirements referred to above.

 

The references to “interest” above mean “interest” as understood in U.K.tax law. The statements above do not take any account of any differentdefinitions of “interest” or “principal” which may prevail under any other lawor which may be created by the terms and conditions of the Notes or any relateddocumentation.

 

*Taxation byDirect Assessment of Noteholders*

 

Notwithstanding that interest is received subject to deduction of incometax, noteholders who are resident in the U.K. for tax purposes or holders whoare non-resident and carrying on a trade, profession or vocation in the U.K.through a branch or agency, may be liable to pay further tax on the interestreceived. Certain holders may be entitled to a refund of all or part of the taxdeducted depending on their individual circumstances.

 

Where the interest is paid without withholding or deduction, the interestwill not be assessed to U.K. tax in the hands of holders of the Notes who arenot resident in the U.K.,

 

17

----

 

except where such persons are carrying on atrade, profession or vocation in the U.K. through a branch or agency inconnection with which the interest is received or to which the Notes areattributable. In such a case (subject to exemptions for interest received bycertain categories of agent) tax may be levied on the U.K. branch or agency.

 

*Ownershipand Disposal (including Redemption) of the Notes by U.K. Corporation Tax Payers*

 

In general holders which are within the charge to U.K. corporation taxwill be charged to tax on all returns and fluctuations in value of the Notesbroadly in accordance with their statutory accounting treatment so long as theaccounting treatment is in accordance with a mark-to-market basis or anaccruals basis which is authorized for tax purposes. Such holders willgenerally be charged to tax in each accounting period by reference to interest(and discount) accrued in that period and any profit or loss which, inaccordance with such holders’ authorized accounting method, is applicable tothat period.

 

*Ownership and Disposal (includingRedemption) of the Notes by other U.K. Tax Payers*

 

A transfer of a Note byan individual noteholder who is resident or ordinarily resident for taxpurposes in the United Kingdom, or who carries on a trade in the United Kingdomthrough a branch or agency to which the Note is attributable, may give rise toa charge to tax on income, under rules known as the “accrued income scheme”, inrespect of an amount representing interest on the Note which has accrued fromthe last interest payment to the time of transfer.

 

An individual noteholderwho is resident or ordinarily resident in the United Kingdom, or who carries ona trade, profession or vocation in the United Kingdom through a branch oragency to which the Note is attributable, may be subject to United Kingdomtaxation on disposal or redemption of a Note. However, in calculating any chargeable gain (or allowable loss) on thetransfer of a Note, the consideration for disposal of the Note will be reducedby any amount on which the noteholder is chargeable to income tax on thetransfer under the accrued income scheme as described in the precedingparagraph.

 

*Stamp Dutyand Stamp Duty Reserve Tax (“SDRT”) on the Notes*

 

No U.K. stamp duty or SDRT is payable on the issue of the global Notes orof the definitive Notes. No U.K. stamp duty is payable on the transfer bydelivery of a global Note, nor is any SDRT payable on any agreement fortransfer of a global Note provided that the Notes are listed on a recognizedstock exchange and the agreement is not made in contemplation of, or as part ofan agreement for, a take-over of the issuer. U.K. stamp duty may be payable on thetransfer in writing of a global Note or of a definitive Note, and SDRT may bepayable on an agreement for a transfer of a definitive Note, unless anexemption applies.

 

*Payments ofInterest on the Notes Treated as Distributions*

 

In the event that any or part of any interest payment is characterized asa distribution for U.K. tax purposes, which may be the case if the return onthe Notes depends on the results of, or a part of, the issuer’s business, orrepresents more than a reasonable commercial return or if thethin-capitalization or transfer-pricing rules apply, that payment or part ofsuch payment would not be deductible in computing the issuer’s profits for U.K.corporation tax purposes. However such characterization should not adverselyaffect the noteholders as any shortfall in payments of

 

18

----

 

principal or interest on the Notes by the issuershould be met by the Note Guarantors pursuant to the Note guarantees.

 

*Proposed EU Savings Directive*

 

On January 21, 2003 theEuropean Union Council of Economic and Finance Ministers agreed to adopt a newdirective regarding the taxation of savings income.  It is proposed that each Member State will be required to provideto the tax authorities of another Member State details of payments of interestor other similar income paid by a person within its jurisdiction to anindividual resident in that other Member State; however, Austria, Belgium andLuxembourg will instead apply a withholding system for a transitional period inrelation to such payments.  The proposeddirective may be subject to further amendment and/or clarification.

 

***United States Taxation***

 

The following summary contains a description of thematerial U.S. federal income tax consequences of the purchase, ownership anddisposition of the Notes. This summary is not a comprehensive description ofall of the tax considerations for noteholders. In particular, this summary ofU.S. federal income tax matters deals only with holders that will hold theNotes as capital assets for U.S. federal income tax purposes (generally, assetsheld for investment) and does not address special tax situations, such as theU.S. federal income tax treatment of holders that are (i) subject to specialtax rules (e.g., financial institutions, securities or currency dealers,brokers, insurance companies, regulated investment companies and tax-exemptorganizations), (ii) holding Notes as part of a hedging or larger integratedfinancial transaction or (iii) U.S. holders with a currency other than the U.S.dollar as their functional currency.

 

This summary is based upon the Code, the Treasuryregulations issued thereunder and official interpretations thereof, each as ineffect on the date hereof, all of which are subject to change, possibly withretroactive effect. Current holders of the Notes should consult their own taxadvisers as to the U.S. federal income tax consequences of the purchase,ownership and disposition of the Notes, in addition to the effect of any stateor local tax laws or tax laws of any jurisdiction other than the United States.

 

As used herein, a U.S. holder means a beneficial ownerof a note who is, for U.S. federal income tax purposes, (i) a citizen orresident of the United States of America (including the states and the Districtof Columbia), (ii) a corporation or other entity taxable as a corporationcreated or organized in the United States or under the laws of the UnitedStates or of any political subdivision thereof, (iii) any estate the income ofwhich is subject U.S. federal income taxation regardless of its source and (iv)any trust if a court within the United States is able to exercise primarysupervision over the administration of the trust, and one or more United Statesfiduciaries have the authority to control all substantial decisions of thetrust, or if the trust elects under U.S. Treasury Regulations to be treated asa U.S. person. In the case of a holder of a note that is a partnership for U.S.federal income tax purposes, each partner will take into account its allocableshare of income or loss from the note under the rules of U.S. federal incometaxation applicable to such partner, taking into account the activities of thepartnership and the partner. A non-U.S. holder means a beneficial owner of a notewho is not a U.S. holder.

 

19

----

 

*Allocationof Purchase Price Between the 2009 Notes and Associated Equity ValueCertificates*

 

The 2009 Notes were issued in the form of units. Eachdollar unit consists of one $1,000 principal amount 2009 dollar note and onedollar equity value certificate evidencing the right to receive upon exercisethe value of 21.54737877 of one Ordinary Share of Cableuropa as of the earliestof certain defined trigger events. Each euro unit consists of one €1,000principal amount 2009 euro note and one euro equity value certificateevidencing the right to receive upon exercise the value of 22.87469851 of oneOrdinary Share of Cableuropa as of the earliest of certain defined triggerevents. For U.S. federal income tax purposes, each unit is treated as aninvestment unit, consisting of a note and an equity value certificate. The“issue price” of a unit generally is equal to the first price at which asubstantial amount of units are sold to the public for cash (other than to bondhouses, brokers or similar persons). The issuer has determined the “issueprice” of each of the 2009 Notes and equity value certificates by allocatingthe $1,000 issue price of each dollar unit between the 2009 dollar note and theassociated dollar equity value certificate and by allocating the €1,000 issueprice of each euro unit between the 2009 euro note and the associated euroequity value certificate based upon their relative fair market values.According to such determination, the issue price of each 2009 dollar Note is$984.59 per $1,000 principal amount, and the issue price of each dollar equityvalue certificate is $15.41. The issue price of each 2009 euro Note is €984.59per €1,000 principal amount, and the issue price of each euro equity valuecertificate is €15.41. These allocations establish a U.S. holder’s initial taxbases in the note and the equity value certificate. These allocations arebinding on each U.S. holder, unless such U.S. holder explicitly discloses (on astatement attached to such U.S. holder’s timely filed U.S. federal income taxreturn for the year that includes the acquisition date of the unit) that itsallocation of the unit’s issue price between the note and the equity valuecertificate is different from the issuer’s allocation. The issuer’s allocationis not binding on the Internal Revenue Service, or IRS, and therefore there canbe no assurance that the IRS will respect such allocation.

 

If the “stated redemption price at maturity” of a 2009dollar or euro note exceeds its issue price by more than a de minimis amount(generally defined as 1⁄4 of 1% of a note’s stated redemption price at maturitymultiplied by the number of complete years to its maturity), the note will betreated as having been issued with original issue discount (“OID”). Based uponthe Issuer’s allocation of the issue price of the units between the 2009 Notesand the associated equity value certificates, the 2009 Notes will be treated ashaving been issued with no OID under the *deminimis* rules described above. However, if the IRS were to disagreewith this allocation, it might successfully contend that the 2009 Notes shouldbe treated as having been issued with OID, in which case US Holders would berequired to include the OID in taxable income as it accrues over the life ofthe Notes. See discussion under the caption “Original Issue Discount” below. USHolders should consult their own tax advisors as to the potential applicationof the OID rules to the 2009 Notes.

 

*Allocationof Purchase Price Between the 2011 Notes and Associated Equity ValueCertificates*

 

The 2011 Notes were issued in the form of units. Eachdollar unit consists of one $1,000 principal amount 2011 dollar note and onedollar equity value certificate evidencing the right to receive upon exercisethe value of 48.89512850 Ordinary Shares of Cableuropa as of the earliest ofcertain defined trigger events. Each euro unit consists of one €1,000 principalamount 2011 euro note and one euro equity value certificate evidencing theright to receive upon exercise the

 

20

----

 

value of 45.98831311 Ordinary Shares of Cableuropa as of the earliestof certain defined trigger events. For U.S. federal income tax purposes, eachunit is treated as an investment unit, consisting of a note and an equity valuecertificate. The “issue price” of a unit generally is equal to the first priceat which a substantial amount of units are sold to the public for cash (otherthan to bond houses, brokers or similar persons). The issuer has determined the“issue price” of each of the 2011 Notes and equity value certificates byallocating the $1,000 issue price of each dollar unit between the 2011 dollarnote and the associated dollar equity value certificate and by allocating the€1,000 issue price of each euro unit between the 2011 euro note and theassociated euro equity value certificate based upon their relative fair marketvalues. According to such determination, the issue price of each 2011 dollarNote is $862.04 per $1,000 principal amount, and the issue price of each dollarequity value certificate is $137.96. The issue price of each 2011 euro Note is€862.03506067 per €1,000 principal amount, and the issue price of each euroequity value certificate is €137.96493933. These allocations establish a U.S.holder’s initial tax bases in the note and the equity value certificate. Theseallocations are binding on each U.S. holder, unless such U.S. holder explicitlydiscloses (on a statement attached to such U.S. holder’s timely filed U.S.federal income tax return for the year that includes the acquisition date ofthe unit) that its allocation of the unit’s issue price between the note andthe equity value certificate is different from the issuer’s allocation. Theissuer’s allocation is not binding on the Internal Revenue Service, or IRS, andtherefore there can be no assurance that the IRS will respect such allocation.

 

After allocating the issue price of the units betweenthe 2011 Notes and the associated equity value certificates in the mannerdescribed above, each of the 2011 Notes will be treated as having been issuedwith original issue discount in an amount equal to the excess of (a) the“stated redemption price at maturity” of the note over (b) its “issue price”.See discussion under the caption “Original Issue Discount” below.

 

*TaxTreatment of the Notes*

 

*Classificationof the Notes*.  Thissummary is based upon the assumption that the Notes will be characterized asindebtedness of the issuer for U.S. federal income tax purposes. Prospectivepurchasers should recognize, however, that there is some uncertainty regardingthe appropriate characterization of instruments such as the Notes, and norulings have been or will be sought from the IRS with respect to theappropriate characterization of the Notes for U.S. federal income tax purposes.It is possible that the IRS might contend that the Notes should be treated notas indebtedness of the issuer but as equity in the issuer. Any suchrecharacterization might result in material adverse consequences to U.S.holders of the Notes, including possible application of the passive foreigninvestment company, or PFIC, rules. In the event that the PFIC rules apply tothe Notes, a U.S. holder would be required to pay an interest charge togetherwith tax calculated at maximum rates on gain realized on the disposition of anote or on certain increased interest payments with respect to a note.Prospective purchasers of the Notes should consult their own tax advisers aboutthe consequences in the event that the Notes are treated as equity for U.S.federal income tax purposes.

 

*StatedInterest*.  Statedinterest on the Notes will be includible in a U.S. holder’s gross income asordinary interest income in accordance with such U.S. holder’s usual method(cash or accrual) of tax accounting.

 

21

----

 

In the case of stated interest received on a euronote, the amount of income recognized by a cash basis U.S. holder will be theU.S. dollar value of the stated interest payment, based on the “spot rate” ineffect on the date of receipt. Spot rate generally means a rate that reflects afair market rate of exchange available to the public for euro under a “spotcontract” in a free market and involving representative amounts. A spotcontract is a contract to buy and sell a euro on or before two business daysfollowing the date of execution of the contract. If such spot rate cannot bedemonstrated, the IRS has authority to determine the spot rate.

 

The amount of stated interest recognized by an accrualbasis U.S. holder of a euro note will be determined for any accrual period ineuro and then translated into U.S. dollars using the average U.S. dollar-euroexchange rate for the accrual period (or, with respect to an accrual periodthat spans two taxable years, using the average exchange rate for the partialperiod within each taxable year). The average rate for an accrual period (orpartial period) is the simple average of the spot rates for each business dayof such period, or other average exchange rate for the period reasonablyderived and consistently applied by the holder. Alternatively, an accrual basisU.S. holder can elect to translate stated interest at the spot rate on the lastday of the accrual period (and, in the case of a partial accrual period, thesport rate on the last day of the taxable year) or on the date the interestpayment is received if such date is within five business days of the end of theaccrual period. A U.S. holder that makes such an election must apply itconsistently to all debt instruments from year to year and cannot change theelection without the consent of the IRS.

 

*OriginalIssue Discount*.  The2010 Notes were not issued with any original issue discount (“OID”). Except assubject to the possible disagreement on the part of the IRS, as describedabove, the 2009 Notes are also treated as having been issued with no OID.

 

As described above, each of the 2011 Notes will betreated as having been issued with OID, in an amount equal to the excess of (a)the “stated redemption price at maturity” of the note over (b) its “issueprice”. U.S. holders should be aware that they generally must include OID ingross income in advance of the receipt of cash attributable to that income.Under these rules, a U.S. holder will have to include in income increasinglygreater amounts of OID in successive accrual periods.

 

The “stated redemption price at maturity” of a notewill equal the sum of all cash payments required to be made on such note otherthan payments of “qualified stated interest”. The term “qualified statedinterest” means stated interest that is unconditionally payable in cash or inproperty (other than debt instruments of the issuer) at least annually at asingle fixed rate or, subject to certain conditions, based on one or moreinterest indices. The stated interest payments on the Notes are qualifiedstated interest. Accordingly, each note will bear OID in an amount equal to theexcess of its principal amount over its issue price.

 

The amount of OID includible in income by a U.S.holder of a note is the sum of the “daily portions” for each day of the taxableyear during which the U.S. holder holds the note. The daily portions of OIDrequired to be included in a U.S. holder’s gross income in a taxable year aredetermined under a constant yield method by allocating to each day during thetaxable year on which the U.S. holder holds the note a pro rata portion of theOID on such note that is attributable to the “accrual period” in which such dayis included. The amount of the OID attributable to each accrual period is anamount equal to the excess, if any, of (a) the product of

 

22

----

 

the note’s “adjusted issue price” at the beginning of such accrualperiod (defined below), and its “yield to maturity” (the discount rate which,when used in computing the present value of all principal and interest paymentsto be made under the note, produces an amount equal to the note’s issue price)over (b) the sum of any qualified stated interest allocable to the accrualperiod. OID allocable to a final accrual period is the difference between theamount payable at maturity and the adjusted issue price at the beginning of thefinal accrual period.

 

The “adjusted issueprice” of the note at the beginning of the first accrual period will be itsissue price. Thereafter, the adjusted issue price at the beginning of any otheraccrual period will be (a) the sum of the note’s issue price and the aggregate amountof OID that accrued for all prior accrual periods, less (b) any payments madeon the note (other than qualified stated interest), if any, on or before thefirst day of the accrual period.

 

*Saleand Redemption of Notes*. A U.S. holder generally will recognize gain or loss upon the sale,exchange, retirement or other disposition of a note in an amount equal to thedifference between the U.S. dollar value of the amount realized upon such sale,exchange, retirement or other disposition (other than amounts attributable toaccrued interest, which will be taxable as such), and such U.S. holder’sadjusted tax basis in the note. For this purpose, an amount received in eurowill be translated into U.S. dollars at the spot rate in effect on the date ofdisposition of the Notes. A U.S. holder’s adjusted tax basis in a note willgenerally equal the issue price of such note (in the case of a euro note,translated into U.S. dollars using the spot rate in effect on the date of aholder’s purchase of a unit) increased by the amount of any OID included inincome (in the case of a euro note, translated into U.S. dollars). Any gain orloss (other than foreign currency gain or loss in the case of a euro note,described below) will be capital gain or loss and generally will be long-termcapital gain or loss if the note is held for more than one year. Under currentlaw, net long-term capital gains of a unincorporated U.S. holder are, undercertain circumstances, taxed at lower U.S. federal income tax rates than areitems of ordinary income. The deductibility of capital losses by a U.S. holder,however, is subject to limitations.

 

*Taxationof Additional Amounts*. If additional amounts are required to be paid in respect of withholdingor deduction for taxes imposed on payments on the Notes, such additionalamounts should be taxable to a U.S. holder as ordinary income at the time suchamounts are accrued or received, in accordance with such U.S. holder’s regularmethod of accounting. In such event, the amount taxable to such U.S. holderwould include all taxes withheld or deducted in respect of the Notes. Thus, aU.S. holder would be required to report income in an amount greater than thecash it receives in respect of payments on the Notes. However, a U.S. holdermay, subject to certain limitations, be eligible to claim as a credit ordeduction the foreign taxes withheld or deducted for purposes of computing itsU.S. federal income tax liability.

 

It is possible, however,that the IRS might require each U.S. holder to include additional amounts ingross income as such amounts accrue over the life of the Notes (in advance ofthe payment of such additional amounts). In such case, it is unclear whether aU.S. holder would be entitled to claim a credit or deduction for the foreigntaxes giving rise to the additional amounts until the taxes are actuallydeducted or withheld. If a U.S. holder is required to accrue additional amountsand not allowed a credit or deduction for the foreign taxes giving rise to theamounts until the taxes are paid, the U.S. holder may have insufficient foreignsource income in the year

 

23

----

 

in which the foreign taxes are actually deducted or withheld to enableit to claim a foreign tax credit with respect to the foreign taxes.

 

*ForeignCurrency Gain or Loss*. U.S. holders of the euro Notes will realize foreign currency gain orloss, which generally will be treated as ordinary income or loss, as the casemay be, upon the receipt of payments on the euro Notes and upon the sale,exchange, retirement or other disposition of the euro Notes, and the realizedforeign currency gain or loss generally will be recognized in accordance withapplicable provisions of the Code. For this purpose, payments on a euro note orproceeds of a disposition of a euro note will be characterized first aspayments of interest and then as payments of principal, and paymentscharacterized as interest will be attributed first to the earliest accrualperiod in which interest has accrued and to which prior payments have not beenattributed. Generally, the amount of foreign currency gain or loss realizedwith respect to payments of interest will be equal to the difference between(x) the euro amount received as translated into U.S. dollars using the spotrate on the date of receipt, and (y) the U.S. dollar amount previously includedin income in respect of the payment. The amount of foreign currency gain orloss realized with respect to payments of principal will be equal to thedifference between (x) the euro amount of principal received as translated intoU.S. dollars using the spot rate on the date of receipt, and (y) the euroamount of principal translated into U.S. dollars using the spot rate on thedate the euro note was acquired. However, the amount of any foreign currencygain or loss realized upon a sale, exchange, retirement or disposition of aeuro note with respect to interest, and principal shall be limited to the totalamount of gain or loss, as the case may be, realized on the transaction.

 

*ForeignTax Credit*

 

For U.S. foreign tax credit purposes, OID, statedinterest, and any additional amounts or special interest with respect to a notewill be treated as foreign-source income and generally will be subject to theseparate foreign tax credit limitation for passive income. However, if suchinterest or OID were to become subject to a withholding tax at a rate of fivepercent or more, it would be segregated in the separate foreign tax creditbasket for high withholding tax interest. If such interest or OID is receivedby a U.S. Holder engaged in the active conduct of a banking, insurance,financing or similar business, it may be segregated in the separate foreign taxcredit basket for financial services income.

 

Gain or loss realized on the sale, exchange,retirement or other disposition of a note (including foreign currency gain orloss) generally will be treated as U.S.-source income or loss for foreign taxcredit purposes.

 

*Non-U.S.Holders*

 

Subject to the discussion of “backup” withholdingbelow, a non-U.S. holder is currently exempt from U.S. federal income taxeswith respect to interest and OID on the Notes unless the non-U.S. holder is (i)an insurance company carrying on a United States insurance business to whichthe interest is attributable, within the meaning of the Code, or (ii) anindividual or corporation that has an office or other fixed place of businessin the United States to which the interest and OID is attributable and theinterest and OID is derived in the active conduct of a banking, financing orsimilar business within the United States or is received by a corporation theprincipal business of which is trading in stock or securities for its ownaccount. In addition, subject to the discussion of backup withholding below, anon-U.S. holder will not be subject to

 

24

----

 

U.S. federal income tax on any gain on a sale or other disposition of anote unless (a) the holder is an individual who is present in the United Statesfor 183 days or more during the taxable year and certain other conditions existor (b) the gain is effectively connected with the conduct of a trade orbusiness within the United States.

 

*InformationReporting and Backup Withholding*

 

In general, information reporting requirements willapply to certain payments within the United States of stated interest, OID,special interest and additional amounts on the Notes, including payments madeby the United States office of a paying agent, broker or other intermediary,and to proceeds of a sale, redemption or other disposition of the Notes througha United States branch of a United States or foreign broker. A “backupwithholding” tax may apply to such payments or proceeds if the beneficial ownerfails to provide a correct taxpayer identification number or, in the case ofpayments of stated interest, OID, special interest or additional amounts, failsto certify that he is not subject to such withholding or fails to reportinterest and dividend income in full. Payments of principal or proceeds fromthe disposition of Notes by or through a foreign office of a U.S. broker orforeign broker with certain relationships with the United States generally willbe subject to information reporting, but not backup withholding. Any amountswithheld under the backup withholding rules from a payment to a beneficialowner will be allowed as a refund or credit against such beneficial owner’sU.S. federal income tax liability provided the required information isfurnished to the IRS.

 

*TaxReturn Disclosure and Investor List Requirements*

 

Recently finalized U.S. Treasury regulation (the “TaxShelter Regulations”) intended to address so-called tax shelters and otherpotentially tax-motivated transactions require participants in a “reportabletransaction” to disclose certain information about the transaction on IRS Form8886 and retain information relation to the transaction.  Organizers and sellers of reportabletransaction are required to maintain lists identifying the investorsparticipating in the transactions and furnish to the IRS upon demand suchinvestor information as well as detailed information regarding thetransactions.  A transaction may be a“reportable transaction” based upon any of several indicia (including theexistence of confidentiality agreements, certain indemnity arrangements,potential for recognizing investment or other losses, or significant book-taxdifferences), and the Tax Shelter Regulations could be interpreted to cover andrequire reporting of transactions that are generally not considered taxshelters, including certain foreign currency transactions.  Currently, legislative proposals are pendingin Congress that, if enacted, should impose significant penalties for failureto comply with these disclosure requirements. Investors should consult their tax advisers concerning any possibledisclosure obligation with respect to their investment and should be aware thatthe Issuer and other participants in the transaction intend to comply with thedisclosure and list maintenance requirements under the Tax Shelter Regulationsas they determine apply to them with respect to this transaction.

 

**Documentson Display**

 

We are required to file reports, including this annualreport on Form 20-F, and other information with the Securities and ExchangeCommission, or SEC. We are allowed to “incorporate by reference” theinformation we file with the SEC. This permits us to disclose importantinformation by referring to these documents.

 

25

----

 

These reports and other information can also beinspected without charge and copied at prescribed rates at the public referencefacilities maintained by the Securities and Exchange Commission in Room 1024,450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional office ofthe Securities and Exchange Commission located at the Northwest Atrium Center,500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies ofthis material are also available by mail from the Public Reference section ofthe Securities and Exchange Commission, at 450 Fifth Street, N.W., Washington,D.C. 20549.

 

**Item 11****.  Quantitative andQualitative Disclosure about Market Risk**

 

We rely entirely on payments bythe Note Guarantors under the multi-borrower credit facilities to provide thefunds necessary for us to pay principal and interest on the Notes.  Our market risk exposure (including exposurerelating to currency exchange risks and interest rate risks) thereforecorresponds to the market risk exposure of the Note Guarantors, includingCableuropa.  For a discussion of themarket risks (including currency exchange risks and interest rate risks) thataffect Cableuropa and the Note Guarantors, please see Item 11 of the CableuropaAnnual Report for the year ended December 31, 2002.

 

**Item 12****.  Description ofSecurities Other than Equity Securities**

 

Not applicable.

 

**PART II**

 

**Item 13****.  Defaults, DividendArrearages and Delinquencies**

 

Not applicable.

 

**Item 14****.  MaterialModifications to the Rights of Security Holders and Use of Proceeds**

 

**ConsentSolicitation**

 

The 2009 Notes were guaranteedon a senior subordinated basis by Cableuropa and its subsidiaries at that time.In May 2000, we obtained the consent of holders of the existing Notes to: (i)permit Cableuropa and its restricted subsidiaries to operate in Portugal andundertake certain limited activities outside Spain and Portugal, (ii) allowCableuropa to designate its recently established Portuguese, Non Franchise CLECServices and Internet subsidiaries as restricted subsidiaries, (iii) exemptfuture restricted subsidiaries from the requirement to guarantee the Notes(subject to a new limitation on transfers of assets between restrictedsubsidiaries that have guaranteed the Notes and those that have not), (iv)increase the amount of the “basket” for permitted investments by Cableuropa andits restricted subsidiaries and (v) make certain technical amendments to theindenture. As a result of these amendments the provisions of the indenturesgoverning the 2009 Notes substantially conform to the terms of the indenturegoverning the 2010 Notes and 2011 Notes.

 

26

----

 

**Item 15****.  Controls andProcedures**

 

Within90 days prior to the date of this report, we carried out an evaluation, underthe supervision and with the participation of our directors, of theeffectiveness of the design and operation of our disclosure controls andprocedures.  Based on this evaluation,our directors have concluded that our disclosure controls and procedures areeffective in timely alerting them to material information required to beincluded in our periodic reports to the SEC. In addition, there have been no significant changes in our internalcontrols or in other factors that could significantly affect those controls subsequentto the date of their last evaluation. Although we believe our pre-existing disclosure controls and proceduresand internal controls were adequate to enable us to comply with our disclosureobligations, as a result of such review we intend to implement changes,primarily to formalize and document procedures already in place.  You should note that the design andoperation of any system of controls and procedures is based in part uponcertain assumptions about the likelihood of future events, and there can be noassurance that any design will succeed in achieving its stated goals under allpotential future conditions, regardless of how remote.

 

27

----

 

**PART III**

**Item 16****.  [Reserved]**

 

**Item 17****.  Financial Statements**

 

Not applicable.

 

**Item 18****.  FinancialStatements**

 

See F- Pages.

 

**Item 19****.  Exhibits**

 

**Exhibits**

 
| 1.1    |   | Memorandum and Articles of  Association of ONO Finance PLC (formerly known as Ballardway Plc)  (incorporated by reference to exhibit 3.1 of registrants’ Registration  Statement submitted October 5, 1999 on Form F-4 (file No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 1.2    |   | Articles of  Association of ONO Finance PLC  (incorporated by reference to exhibit 3.14 of registrants’ Registration  Statement submitted October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 2.1    |   | Indenture, dated as of  June 30, 2000 between ONO Finance PLC, Cableuropa S.A., Albacete Sistemas de  Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y Televisión de El  Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación Mallorquina de  Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea Norte Sistemas  de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Región de Murcia de  Cable, S.A., Valencia de Cable, S.A., Santander de Cable, S.A., Univertel  Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al Cliente, S.A.  and The Bank of New York in respect of ONO Finance PLC’s €200,000,000 14%  Notes due 2010 (incorporated by reference to exhibit 4.1 of registrants’  Registration Statement submitted November 29, 2000 on form F-4 (File No.  333-12932)). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 2.2    |   | Registration Rights Agreement dated June 30, 2000,  by and between the Initial Purchasers, as defined therein, ONO Finance PLC,  Cableuropa S.A., and the Note Guarantors, as used therein (incorporated by  reference to exhibit 10.24 of registrants’ Registration Statement submitted  November 29, 2000 on form F-4 (File No. 333-12932)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 2.3    |   | Dollar Note Indenture, dated as of May 6, 1999,  between ONO Finance PLC and Bankers Trust Company in respect of ONO Finance  PLC’s $275,000,000 13% Notes due 2009 (incorporated by reference to exhibit  4.1 of registrants’ Registration Statement submitted October 5, 1999 on form  F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 2.4    |   | Supplemental Dollar Note Indenture, dated as of  September 28, 1999, between ONO Finance PLC, Santander de Cable, S.A. and  Bankers Trust Company in respect of ONO Finance PLC’s $275,000,000 13% Notes  due 2009 (incorporated by reference to exhibit 4.2 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File No.  333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |

 

28

----

 
| 2.5    |   | Euro Note Indenture, dated as of May 6, 1999,  between ONO Finance PLC and Bankers Trust Company in respect of ONO Finance  PLC’s  125,000,000 13% Notes due 2009  (incorporated by reference to exhibit 4.3 of registrants’ Registration  Statement submitted October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2.6    |   | Supplemental Euro Note Indenture dated as of  September 28, 1999, between ONO Finance PLC, Santander de Cable, S.A. and  Bankers Trust Company in respect of ONO Finance PLC’s €125,000,000 13% Notes  due 2009 (incorporated by reference to exhibit 4.4 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2.7    |   | Registration Rights Agreement dated May 6, 1999, by  and between the Initial Purchasers, as defined in the Purchase Agreement, ONO  Finance PLC, Cableuropa S.A., and the Controlled Companies, as defined  therein (incorporated by reference to exhibit 10.28 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File No.  333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2.8    |   | Purchase Agreement,  dated as of February 2, 2001 by and between the Initial Purchasers, as  defined therein, ONO Finance PLC, Cableuropa, S.A., Albacete Sistemas de  Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y Televisión de El  Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación Mallorquina de  Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea Norte Sistemas  de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Región, de Murcia  de Cable, S.A., Valencia de Cable, S.A., Santander de Cable, S.A., TDC  Sanlúcar, S.A., Univertel Comunicaçôes Universais, S.A., Hydra Servicios de  Atencion al Cliente, S.A. (incorporated by reference to exhibit 1.1 of  registrants’ Registration Statement submitted May 17, 2001 on form F-4 (File  No. 333-13536)).                                        |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2.9    |   | Indenture, dated as of  February 9, 2001 between ONO Finance PLC, Cableuropa S.A., Albacete Sistemas  de Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y  Televisión de El Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación  Mallorquina de Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea  Norte Sistemas de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Región, de Murcia de Cable, S.A., Valencia de Cable, S.A., Santander de  Cable, S.A., Univertel Comunicaçôes Universais, S.A., Hydra Servicios de  Atencion al Cliente, S.A., TDC Sanlúcar, S.A., and The Bank of New York in  respect of ONO Finance PLC’s $200,000,000 14% Notes due 2011 (incorporated by  reference to exhibit 4.1 of registrant’s Registration Statement submitted May  17, 2001 on form F-4 (File No. 333-13530)). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2.10   |   | Indenture, dated as of  February 9, 2001 between ONO Finance PLC, Cableuropa S.A., Albacete Sistemas  de Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y Televisión de  El Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación Mallorquina  de Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Región, de  Murcia de Cable, S.A., Valencia de Cable, S.A., Santander de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al  Cliente, S.A., TDC Sanlúcar, S.A., and The Bank of New York in respect of ONO  Finance PLC’s                                                                                                                                                                                        |

 

29

----

 
|   |   | $150,000,000 14% Notes  due 2011 (incorporated by reference to exhibit 4.2 of registrant’s  Registration Statement submitted May 17, 2001 on form F-4 (File No.  333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 2.11   |   | Registration Rights Agreement dated February 9,  2001, by and between the Initial Purchasers, as defined therein, ONO Finance  PLC, Cableuropa S.A., and the Note Guarantors, as used therein (incorporated by reference to exhibit  10.24 of registrant’s Registration Statement submitted May 17, 2001 on form  F-4 (File No. 333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 3.1    |   | Vote Pooling Agreement, dated January 22, 1998, by  and between parties representing Cableuropa, S.A., and Spanish Telecommunications  Limited S.á.r.l (incorporated by reference to exhibit 10.12 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File No.  333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.1    |   | Shareholders’ Agreement of Cableuropa, dated  November 3, 2000, by and between Ferrovial Telecomunicaciones S.A., Grupo  Multitel, S.A., Cántabra de Inversiones, S.A., Spanish Telecommunications  Limited, S.à.r.l, Santander Telecommunications, Inc., Global Telecom  Investments, LLC, BAEP Telecommunications Investments, LLC, Particel  International Limited Partnership and VAL Telecommunications, S.L.  (incorporated by reference to exhibit 10.1 of registrants’ Registration  Statement submitted November 29, 2000 on form F-4 (File No. 333-12932)).                                                                                                                                                                                                                   |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.2    |   | Euro Multi-Borrower  Credit Facility, dated June 30, 2000, between Cableuropa, S.A., Valencia de  Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de  Cable, S.A., and Albacete Sistemas de Cable, S.A., as Borrowers, and ONO  Finance PLC, as lender (incorporated by reference to exhibit 10.26 of registrants’  Registration Statement submitted November 29, 2000 on form F-4 (File No.  333-12932)).                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.3    |   | Novation Agreement,  dated February 13, 2003, to Modify, without Termination, a Euro  Multi-Borrower Credit Facility dated June 30, 2000, between Cableuropa  S.A.U., Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atención al  Cliente, S.A., as Borrowers and ONO Finance PLC, as lender.                                                                                                                                                                                                                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.4    |   | Escrow and Disbursement  Agreement, dated June 30, 2000, by and among The Bank of New York, ONO  Finance PLC, Cableuropa, S.A. Valencia de Cable, S.A., Mediterránea Sur  Sistemas de Cable, S.A., Mediterránea Norte Sistemas de Cable, S.A., Región  de Murcia de Cable, S.A., Huelva de Cable y Televisión, S.A., Cádiz de Cable  y Televisión, S.A., Cable y Televisión de El Puerto, Cable y Televisión de  Andalucia, S.A., Corporación Mallorquina de Cable, S.A., Albacete Sistemas de  Cable, S.A., Hydra Servicios de Atencion al Cliente, S.A. and Univertel  Comunicaçôes, S.A. (incorporated by reference to exhibit 10.28 of  registrants’ Registration Statement submitted November 29, 2000 on form F-4  (File No. 333-12932)). |

 

30

----

 
| 4.5    |   | Senior Bank Facility  Agreement, dated March 6, 2000, between Cableuropa, S.A., Bank of America  International limited, Barclays Capital, Citibank, N.A., Toronto Dominion  Bank Europe Limited, Albacete Sistemas de Cable S.A., Cádiz de Cable y  Televisión S.A., Región de Murcia de Cable S.A., Valencia de Cable S.A.,  Corporación Mallorquina de Cable S.A., Cable y Televisión de El Puerto S.A.,  Huelva de Cable y Televisión S.A., Mediterránea Sur Sistemas de Cable S.A.,  Mediterránea Norte Sistemas de Cable S.A., Cable y Televisión de Andalucía  S.A. and Hydra Servicios de Atencion al Cliente, S.A. (incorporated by  reference to exhibit 10.25 of registrants’ Registration Statement submitted  November 29, 2000 on form F-4 (File No. 333-12932)).                                 |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 4.6    |   | Purchase Agreement,  dated as of June 23, 2000 by and between the Initial Purchasers, as defined  therein, ONO Finance PLC, Cableuropa, S.A., Albacete Sistemas de Cable, S.A.,  Cable y Televisión de Andalucía, S.A., Cable y Televisión de El Puerto, S.A.,  Cádiz de Cable y Televisión, S.A., Corporación Mallorquina de Cable, S.A.,  Huelva de Cable y Televisión, S.A., Mediterránea Norte Sistemas de Cable,  S.A., Mediterránea Sur Sistemas de Cable, S.A., Región de Murcia de Cable,  S.A., Valencia de Cable, S.A., Santander de Cable, S.A., Univertel  Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al Cliente, S.A.  (incorporated by reference to exhibit 1.1 of registrants’ Registration  Statement submitted November 29, 2000 on form F-4 (File No. 333-12932)). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 4.7    |   | Note Depositary Agreement,  dated June 30, 2000, by and between ONO Finance PLC and The Bank of New York  Trust Company (Cayman) Limited (incorporated by reference to exhibit  10.27 of registrants’ Registration Statement submitted November 29, 2000 on  form F-4 (File No. 333-12932)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 4.8    |   | Senior Facility  Agreement, dated June 14, 1999, between Cableuropa, S.A., Electro Banque  S.A., Albacete Sistemas de Cable S.A., Cádiz de Cable y Televisión S.A.,  Región de Murcia de Cable S.A., Valencia de Cable S.A., Corporación  Mallorquina de Cable S.A., Cable y Televisión de El Puerto S.A., Huelva de  Cable y Televisión S.A., Mediterránea Sur Sistemas de Cable S.A.,  Mediterránea Norte Sistemas de Cable S.A., and Cable y Televisión de Andalucía  S.A. (incorporated by reference to exhibit 10.29 of registrants’ Registration  Statement submitted October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                 |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 4.9    |   | Dollar Multi-Borrower  Credit Facility, dated May 6, 1999, between Cableuropa, S.A., Valencia de  Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de  Cable, S.A., and Albacete Sistemas de Cable, S.A., as Borrowers, and ONO  Finance PLC, as Lender (incorporated by reference to exhibit 10.30 of  registrants’ Registration Statement submitted October 5, 1999 on form F-4  (File No. 333-10976)).                                                                                                                                              |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 4.10   |   | Novation Agreement,  dated February 13, 2003, to Modify, without Termination, a Dollar  Multi-Borrower Credit Facility dated May 6, 1999, between Cableuropa S.A.U.,  Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

 

31

----

 
|   |   | Universais, S.A., Hydra  Servicios de Atención al Cliente, S.A., as Borrowers and ONO Finance PLC, as  lender.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.11   |   | Euro Multi-Borrower  Credit Facility, dated May 6, 1999, between Cableuropa, S.A., Valencia de  Cable S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y  Televisión de Andalucia, S.A., Corporación Mallorquina de Cable, S.A., and  Albacete Sistemas de Cable, S.A., as Borrowers, and ONO Finance PLC, as  Lender (incorporated by reference to exhibit 10.31 of registrants’ Registration  Statement submitted October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.12   |   | Novation Agreement,  dated February 13, 2003, to Modify, without Termination, a Euro  Multi-Borrower Credit Facility dated May 6, 1999, between Cableuropa S.A.U.,  Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atención al  Cliente, S.A., as Borrowers and ONO Finance PLC, as lender.                                                                                                                                                                                                                                                                                                                                                    |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.13   |   | Dollar Equity Value Certificate Agreement, dated May  6, 1999, among ONO Finance PLC, Cableuropa, S.A., and Bankers Trust Company,  as Equity Value Certificate Agent (incorporated by reference to exhibit 10.32  of registrants’ Registration Statement submitted October 5, 1999 on form F-4  (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.14   |   | Euro Equity Value Certificate Agreement, dated May  6, 1999, among ONO Finance PLC, Cableuropa, S.A., and Bankers Trust Company,  as Equity Value Certificate Agent (incorporated by reference to exhibit 10.33  of registrants’ Registration Statement submitted October 5, 1999 on form F-4  (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.15   |   | Dollar Escrow and  Disbursement Agreement, dated May 6, 1999, by and among Bankers Trust  Company, ONO Finance PLC, Cableuropa, S.A., Valencia de Cable, S.A.,  Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte Sistemas de  Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y Televisión,  S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El Puerto,  Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de Cable,  S.A., and Albacete Sistemas de Cable, S.A. (incorporated by reference to  exhibit 10.36 of registrants’ Registration Statement submitted October 5,  1999 on form F-4 (File No. 333-10976)).                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.16   |   | Euro Escrow and  Disbursement Agreement, dated May 6, 1999, by and among Bankers Trust  Company, ONO Finance PLC, Cableuropa, S.A., Valencia de Cable, S.A.,  Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte Sistemas de Cable,  S.A., Región de Murcia de Cable, S.A., Huelva de Cable y Televisión, S.A.,  Cádiz de Cable y Televisión, S.A., Cable y Televisión de El Puerto, Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de  Cable, S.A., and Albacete Sistemas de Cable, S.A. (incorporated by reference  to exhibit 10.37 of registrants’ Registration Statement submitted October 5,  1999 on form F-4 (File No. 333-10976)). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.17   |   | Dollar Note Depositary  Agreement, dated May 6, 1999, by and between ONO Finance PLC and Bankers  Trust Company (incorporated by reference to exhibit 10.34 of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |

 

32

----

 
|   |   | registrants’ Registration Statement submitted  October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.18   |   | Euro Note Depositary  Agreement, dated May 6 1999, by and between ONO Finance PLC and Bankers Trust  Company (incorporated by reference to exhibit 10.35 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File No.  333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.19   |   | Euro Multi-Borrower  Credit Facility, dated as of February 9, 2001 between Cableuropa S.A.,  Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región, de Murcia de Cable, S.A.,  Huelva de Cable y Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable  y Televisión de El Puerto, Cable y Televisión de Andalucia, S.A., Corporación  Mallorquina de Cable, S.A., Albacete Sistemas de Cable, S.A., Santander de  Cable, S.A., Univertel Comunicaçôes S.A., Hydra Servicios de Atencion al  Cliente, S.A., and TDC Sanlúcar, S.A., as Borrowers, and ONO Finance PLC, as  Lender, in respect of ONO Finance Plc’s $200,000,000 14% Notes (incorporated by  reference to exhibit 10.25 of registrant’s Registration Statement submitted  May 17, 2001 on form F-4 (File No. 333-13530)).   |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.20   |   | Novation Agreement,  dated February 13, 2003, to Modify, without Termination, a Dollar  Multi-Borrower Credit Facility dated February 9, 2001, between Cableuropa  S.A.U., Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atención al  Cliente, S.A., as Borrowers and ONO Finance PLC, as lender.                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.21   |   | Dollar Multi-Borrower  Credit Facility, dated as of February 9, 2001 between Cableuropa S.A.,  Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región, de Murcia de Cable, S.A.,  Huelva de Cable y Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable  y Televisión de El Puerto, Cable y Televisión de Andalucia, S.A., Corporación  Mallorquina de Cable, S.A., Albacete Sistemas de Cable, S.A., Santander de  Cable, S.A., Univertel Comunicaçôes S.A., Hydra Servicios de Atencion al  Cliente, S.A., and TDC Sanlúcar, S.A., as Borrowers, and ONO Finance PLC, as  Lender, in respect of ONO Finance Plc’s $150,000,000 14% Notes (incorporated  by reference to exhibit 10.26 of registrant’s Registration Statement  submitted May 17, 2001 on form F-4 (File No. 333-13530)). |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.22   |   | Novation Agreement,  dated February 13, 2003, to Modify, without Termination, a Euro  Multi-Borrower Credit Facility dated February 9, 2001, between Cableuropa  S.A.U., Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atención al  Cliente, S.A., as Borrowers and ONO Finance PLC, as lender.                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.23   |   | Note Depositary Agreement, dated February 9, 2001,  by and between ONO Finance PLC and The Bank of New York Trust Company  (Cayman) Limited, in respect of ONO Finance PLC’s $200,000,000 14% Notes (incorporated by reference to exhibit  10.27 of registrant’s Registration Statement submitted May 17, 2001 on form  F-4 (File No. 333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

 

33

----

 
| 4.24   |   | Note Depositary Agreement, dated February 9, 2001,  by and between ONO Finance PLC and The Bank of New York Trust Company  (Cayman) Limited, in respect of ONO Finance PLC’s $150,000,000 14% Notes (incorporated by reference to exhibit  10.28 of registrant’s Registration Statement submitted May 17, 2001 on form  F-4 (File No. 333-13530)). |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                         |
| 12.1   |   | Certification of Bryan Needham, Director, pursuant  to Section 906 of the Sarbanes-Oxley Act 2002.                                                                                                                                                                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                         |
| 12.2   |   | Certification of Peter Hills, Director, pursuant to  Section 906 of the Sarbanes-Oxley Act 2002.                                                                                                                                                                                                                                                             |

 

34

----

 

**SIGNATURES**

 

Pursuant to the requirements of Section 12 of theSecurities Exchange Act of 1934, the Registrant certifies that it meets all ofthe requirements for filing on Form 20-F and has duly caused this report to besigned on its behalf by the undersigned, thereunto duly authorized.

 
|   | ONO FINANCE PLC |
|--------|-----------------|
|   |            |
|   | (Registrant)    |
|   |            |
|   |            |
|   | By:             | /s/ Peter Hills |
|   |            |
|   | Peter Hills     |
|   | Director        |
| Date:  | May 29, 2003    |   |
|        |                 |  |  |

 

35

----

 

**Certification Pursuant to Section 302of the Sarbanes-Oxley Act 2002**

 

I, Bryan Needham, certifythat:

 

1.                                 Ihave reviewed this annual report on Form 20-F of ONO Finance PLC, (the“Company”);

 

2.                                 Basedon my knowledge, this report does not contain any untrue statement of amaterial fact or omit to state a material fact necessary to make the statementsmade, in light of the circumstances under which such statements were made, notmisleading with respect to the period covered by this report;

 

3.                                 Basedon my knowledge, the financial statements, and other financial informationincluded in this report, fairly present in all material respects the financialcondition, results of operations and cash flows of the Company as of, and for,the periods presented in this report;

 

4.                                 TheCompany’s other certifying officers and I are responsible for establishing andmaintaining disclosure controls and procedures (as such term is defined inparagraph (c) of Exchange Act Rule 15d-14) for the Company and we have:

 

(a)                                      Designedsuch disclosure controls and procedures to ensure that material informationrelating to the Company, including its consolidated subsidiaries, is made knownto us by others within those entities, particularly during the period in whichthis report is being prepared;

 

(b)                                     Evaluatedthe effectiveness of the Company’s disclosure controls and procedures as of adate within 90 days prior to the filing date of this report (“EvaluationDate”);

 

(c)                                      Presentedin this report our conclusions about the effectiveness of the disclosurecontrols and procedures based on our evaluation as of the Evaluation Date;

 

(d)                                     Disclosed,based on our most recent evaluation, to the Company’s auditors and the auditcommittee of the board of directors (or persons fulfilling the equivalentfunction):

 

(i)                        Allsignificant deficiencies in the design or operation of internal controls whichcould adversely affect the Company’s ability to record, process, summarize andreport financial data and have identified for the Company’s auditors anymaterial weaknesses in internal controls; and

 

(ii)                     Any fraud,whether or not material, that involves management or other employees who have asignificant role in the Company’s internal controls; and

 

(e)                                      Indicatedin this report whether or not there were significant changes in the Company’sinternal controls or in other factors that could significantly affect internalcontrols subsequent to the date of their most recent evaluation, including anycorrective actions with regard to significant deficiencies and materialweaknesses.

 
| By:        | /s/ Bryan Needham |   |
|------------|-------------------|--------|
| **Name:**  | **Bryan Needham** |
| **Title:** | **Director**      |
| **Date:**  | **May 29, 2003**  |
|            |                   |        |  |

 

36

----

 

**CertificationPursuant to Section 302 of the Sarbanes-Oxley Act 2002**

 

I, Peter Hills, certify that:

 

1.                                 Ihave reviewed this annual report on Form 20-F of ONO Finance PLC, (the“Company”);

 

2.                                 Basedon my knowledge, this report does not contain any untrue statement of amaterial fact or omit to state a material fact necessary to make the statementsmade, in light of the circumstances under which such statements were made, notmisleading with respect to the period covered by this report;

 

3.                                 Basedon my knowledge, the financial statements, and other financial informationincluded in this report, fairly present in all material respects the financialcondition, results of operations and cash flows of the Company as of, and for,the periods presented in this report;

 

4.                                 TheCompany’s other certifying officers and I are responsible for establishing andmaintaining disclosure controls and procedures (as such term is defined inparagraph (c) of Exchange Act Rule 15d-14) for the Company and we have:

 

(a)                                      Designedsuch disclosure controls and procedures to ensure that material informationrelating to the Company, including its consolidated subsidiaries, is made knownto us by others within those entities, particularly during the period in whichthis report is being prepared;

 

(b)                                     Evaluatedthe effectiveness of the Company’s disclosure controls and procedures as of adate within 90 days prior to the filing date of this report (“EvaluationDate”);

 

(c)                                      Presentedin this report our conclusions about the effectiveness of the disclosurecontrols and procedures based on our evaluation as of the Evaluation Date;

 

(d)                                     Disclosed,based on our most recent evaluation, to the Company’s auditors and the auditcommittee of the board of directors (or persons fulfilling the equivalentfunction):

 

(i)                        Allsignificant deficiencies in the design or operation of internal controls whichcould adversely affect the Company’s ability to record, process, summarize andreport financial data and have identified for the Company’s auditors anymaterial weaknesses in internal controls; and

 

(ii)                     Any fraud,whether or not material, that involves management or other employees who have asignificant role in the Company’s internal controls; and

 

(e)                                      Indicatedin this report whether or not there were significant changes in the Company’sinternal controls or in other factors that could significantly affect internalcontrols subsequent to the date of their most recent evaluation, including anycorrective actions with regard to significant deficiencies and materialweaknesses.

 
| By:        | /s/ Peter Hills  |   |
|------------|------------------|--------|
| **Name:**  | **Peter Hills**  |
| **Title:** | **Director**     |
| **Date:**  | **May 29, 2003** |
|            |                  |        |  |

 

37

----

 

ONO FINANCE PLC

 

ANNUAL REPORT ANDACCOUNTSFOR THEYEAR ENDED 31 DECEMBER 2002

 

 

Registered number:3619149

 

----

 

CONTENTS

 
| Directors’  Report            |
|------------------------------------|
|                               |
| Independent Auditors’  Report |
|                               |
| Profit And Loss Account            |
|                               |
| Balance Sheet                      |
|                               |
| Notes To The Accounts              |

 

----

 

**ONOFINANCE PLCDIRECTORS’ REPORTFOR THE YEAR ENDED 31 DECEMBER 2002**

 

The directors present their report on the affairs of ONO Finance PLC(the “**Company**”), together with theaccounts and auditors’ report for the year ended 31 December 2002.

 

**Principal activity**

The principal activity of the company is that of a finance company. ONOFinance PLC ́s business is the issuance of debt and the provision of debtfinance to Cableuropa S.A.U. and its subsidiary companies (the “**Cableuropa Group**”). The Cableuropa Group isone of the leading broadband telecommunications business in Spain.

 

**Review of the business**

No new loan Notes were issued in the year. However, on 13 February 2003a significant portion of the high yield debt has been cancelled. This was theresult of the sole shareholder of the Cableuropa Group, Grupo Corporativo ONO,S.A. (“**GCO**”), purchasing the bondsin the open market and through a tender offer announced on 20 November 2002.Although this means that going forward, the margin made on the on-lending tothe Cableuropa Group will decrease, Cableuropa S.A.U. agreed to pay to ONOFinance (Holdings) Limited a one-off fee of £93K and an on-going annual fee of£65K in recognition of the company agreeing to the cancellation.

 

**Results and dividend**

The results for the period are shown on page 5 and arise fromcontinuing operations. The directors recommend a final dividend of £1.50 pershare for the year ended 31 December 2002 (2001: £1.50 per share, 2000: £nil).

 

**Directors**

The directors, who held office during the period, had no interest inthe shares of the company at any time.

 

The directors who served during the period were as follows

 

Mr. B D Needham

Mr. P M Hills

 

**Directors responsibilities**

The directors are required by Company Law to prepare accounts for eachfinancial year which give a true and fair view of the state of affairs of thecompany as at the end of the financial year and of the profit or loss of thecompany for the financial year.

 

The directors are responsible for ensuring that the company keepsaccounting records which disclose with reasonable accuracy the financialposition of the company and which enable them to comply with the Companies Act1985. They also have general responsibility for taking reasonable steps tosafeguard the assets of the company and for taking reasonable steps to preventand detect fraud and other irregularities.

 

The directors confirm that, in preparing the accounts, suitableaccounting policies, consistently applied and supported by reasonable andprudent judgements and estimates, have been used and that applicable accountingand financial reporting standards have been followed.

 

F-1

----

 

The maintenance and integrity of the company’s website is theresponsibility of the directors. Information published on the internet is available in many countrieswith different legal requirements. Legislation in the United Kingdom governing the preparation anddissemination of financial statements may differ from legislation in otherjurisdictions.

 

**Supplier payment policy**

The company’s policy is to settle terms of payment with suppliers whenagreeing the terms of each transaction, ensure that suppliers are made aware ofthe terms of payment and abide by the terms of payments.  The trade creditors, expressed as a numberof days, was zero as all trading expenses were paid by ONO Finance (Holdings)Limited (“the holding company”) which abides by these terms.

 

**Auditors**

The auditors, PricewaterhouseCoopers LLP, have indicated theirwillingness to continue in office and a resolution concerning their reappointmentwill be proposed at the Annual General Meeting.

 

This report was approved and signed on behalf of the Board on 23 May2003.

 
| /s/  BD  Needham |   |
|-----------------------|--------|
| B D Needham           |
| **Director**          |

 

Clifford Chance Secretaries200 Aldersgate StreetLondonEC1A 4JJ

 

F-2

----

 

**INDEPENDENT AUDITORS’ REPORT****TO THE MEMBERS OF ONO FINANCE PLC**

 

We have audited the financial statements of ONO Finance PLC whichcomprise the profit and loss account, the balance sheet, the statement of totalrecognised gains and losses and the related notes.

 

Respective responsibilities of directors and auditors

 

The directors’ responsibilities for preparing the annual report, thereport on Form 20-F and the financial statements in accordance with applicableUnited Kingdom and United States of America laws and Accounting Standards areset out in the statement of directors’ responsibilities.

 

Our responsibility is to audit the financial statements in accordancewith relevant legal and regulatory requirements and United Kingdom AuditingStandards issued by the Auditing Practices Board (APB).

 

We report to you our opinion as to whether the financial statementsgive a true and fair view and are properly prepared in accordance with theUnited Kingdom Companies Act 1985. We also report to you if, in our opinion,the directors’ report is not consistent with the financial statements, if thecompany has not kept proper accounting records, if we have not received all theinformation and explanations we require for our audit, or if informationspecified by law regarding directors’ remuneration and transactions is notdisclosed.

 

We read the other information contained in the annual report andconsider the implications for our report if we become aware of any apparentmisstatements or material inconsistencies with the financial statements.  The other information comprises only thedirectors’ report.

 

Basis of audit opinion

 

We conducted our audit in accordance with Auditing Standards issued bythe United Kingdom Auditing Practices Board, and with Auditing Standardsgenerally accepted in the United States of America. An audit includesexamination, on a test basis, of evidence relevant to the amounts anddisclosures in the financial statements. It also includes an assessment of the significant estimates andjudgements made by the directors in the preparation of the financialstatements, and of whether the accounting policies are appropriate to thecompany’s circumstances, consistently applied and adequately disclosed.

 

We planned and performed our audit so as to obtain all the informationand explanations which we considered necessary in order to provide us withsufficient evidence to give reasonable assurance that the financial statementsare free from material misstatement, whether caused by fraud or otherirregularity or error.  In forming ouropinion we also evaluated the overall adequacy of the presentation ofinformation in the financial statements.

 

United Kingdom opinion

 

In our opinion the financial statements give a true and fair view ofthe state of affairs of the company at 31 December 2002 and of the result ofthe company for the year then ended and have been properly prepared inaccordance with the Companies Act 1985.

 

F-3

----

 

United States opinion

 

In our opinion, the financial statements present fairly, in allmaterial respects, the financial position of ONO Finance PLC at 31 December2002 and 31 December 2001 and the results of its operations and its cash flowsfor each of the three years ended 31 December 2002, 31 December 2001 and 31December 2000, all expressed in pounds sterling, in conformity with accountingprinciples generally accepted in the United Kingdom.

 

Accounting principles generally accepted in the United Kingdom vary incertain significant respects from accounting principles generally accepted inthe United States of America.  Theapplication of the latter would have affected the determination of net incomefor the each of the three years ended 31 December 2002, 31 December 2001 and 31December 2000 and the determination of Shareholders’ equity at 31 December 2002and 31 December 2001, all expressed in pounds sterling to the extent summarisedin Note 13 to the financial statements.

 
| /s/ PricewaterhouseCoopers LLP                |   |
|-----------------------------------------------|--------|
| PricewaterhouseCoopers LLP                    |
| Chartered Accountants and Registered Auditors |
| No 1 London Bridge                            |
| London                                        |
| SE1 9QL                                       |
|                                          |
| 23 May 2003                                   |

 

F-4

----

 

**ONOFINANCE PLCPROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED 31 DECEMBER 2002**

** **
|                                           |   | **Notes** |       | **Year ended  31 December  2002** |       | **Year ended  31 December  2002** |   | **Year ended  31 December  2001** |   | **Year ended  31 December  2000** |   |
|------------------------------------------------|--------|-----------|------------|-----------------------------------|------------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|
|                                           |   |      |       | **£**                        |       | **US$**                           |   | **£**                        |   | **£**                        |   |
|                                           |   |      |       |                              |       | **(Note 13)**                     |   |                              |   |                              |   |
|                                           |   |      |       |                              |       |                              |   |                              |   |                              |   |
| Interest  receivable and similar income        |   | 2         | ** ** | **88,695,480**                    | ** ** | 142,755,375                       |   | 86,248,879                        |   | 44,665,846                        |   |
| Foreign exchange  gains/(losses), net          |   |      |       | **9,941**                         | ** ** | 16,000                            |   | (307                              | )      | (11,678                           | )      |
| Interest payable  and similar charges          |   | 3         | ** ** | **(88,629,172**                   | **)**      | (142,648,652                      | )      | (86,189,430                       | )      | (44,620,397                       | )      |
| Profit on  ordinary activities before taxation |   |      |       | **76,249**                        | ** ** | 122,723                           |   | 59,142                            |   | 33,771                            |   |
| Tax on profit on  ordinary activities          |   | 4         | ** ** | **(9,335**                        | **)**      | (15,025                           | )      | (17,743                           | )      | —                            |   |
| Profit on  ordinary activities after taxation  |   |      |       | **66,914**                        | ** ** | 107,698                           |   | 41,399                            |   | 33,771                            |   |
| Dividend                                       |   | 5         | ** ** | **(74,997**                       | **)**      | (120,708                          | )      | (75,000                           | )      | —                            |   |
| Retained  (loss)/profit for the period         |   |      |       | **(8,083**                        | **)**      | (13,010                           | )      | (33,601                           | )      | 33,771                            |   |

 

The results for the period arise entirely from continuing operations.

 

The accompanying notes are an integral part of these accounts

 

**STATEMENT OF RECOGNISED GAINS ANDLOSSESFOR THE YEAR ENDED 31 DECEMBER 2002**

 
|                                                          |   | **Year ended  31 December  2002** |       | **Year ended  31 December  2002** |   | **Year ended  31 December   2001** |   | **Year ended  31 December  2000** |   |
|---------------------------------------------------------------|--------|-----------------------------------|------------|-----------------------------------|--------|------------------------------------|--------|-----------------------------------|--------|
|                                                          |   | **£**                        |       | **US$**                           |   | **£**                         |   | **£**                        |   |
|                                                          |   |                              |       | **(Note 13)**                     |   |                               |   |                              |   |
|                                                          |   |                              |       |                              |   |                               |   |                              |   |
| Profit for the  financial period                              |   | **66,914**                        | ** ** | 107,698                           |   | 41,399                             |   | 33,771                            |   |
| Revaluation of  equity value certificates due from Cableuropa |   | **(30,535,128**                   | **)**      | (49,146,288                       | )      | 39,586,078                         |   | (3,567,713                        | )      |
| Revaluation of  equity value certificates due to bondholders  |   | **30,535,128**                    | ** ** | 49,146,288                        |   | (39,586,078                        | )      | 3,567,713                         |   |
|                                                          |   | **66,914**                        |       | 107,698                           |   | 41,399                             |   | 33,771                            |   |

 

The accompanying notes are an integral part of these accounts.

 

F-5

----

 

**ONOFINANCE PLCBALANCE SHEETAS AT 31 DECEMBER 2002**

 
|                                                     |   | **Notes** |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2001** |   | **Year ended 31  December  2000** |   |
|----------------------------------------------------------|--------|-----------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|
|                                                     |   |      |   | **£**                        |   | **US$**                           |   | **£**                        |   | **£**                        |   |
|                                                     |   |      |   |                              |   | **(Note 13)**                     |   |                              |   |                              |   |
|                                                     |   |      |   |                              |   |                              |   |                              |   |                              |   |
| Debtors:  receivable after more than one year            |   |      |   | 572,209,595                       |   | 920,971,343                       |   | 565,865,404                       |   | 374,028,569                       |   |
| Debtors:  receivable within one year                     |   |      |   | 59,931,601                        |   | 96,459,912                        |   | 108,582,822                       |   | 26,135,308                        |   |
| Total debtors                                            |   | 6         |   | 632,141,196                       |   | 1,017,431,255                     |   | 674,448,226                       |   | 400,163,877                       |   |
| Cash at bank and  in hand                                |   |      |   | 85,745                            |   | 138,007                           |   | 23,863                            |   | 12,475                            |   |
| Current assets                                           |   |      |   | 632,226,941                       |   | 1,017,569,262                     |   | 674,472,089                       |   | 400,176,352                       |   |
| Creditors:  amounts falling due within one year          |   | 7         |   | (28,978,215                       | )      | (46,640,437                       | )      | (29,310,829                       | )      | (22,436,726                       | )      |
| Net current  assets                                      |   |      |   | 603,248,726                       |   | 970,928,825                       |   | 645,161,260                       |   | 377,739,626                       |   |
| Creditors:  amounts falling due after more than one year |   | 8         |   | (603,227,833                      | )      | (970,895,197                      | )      | (645,132,284                      | )      | (377,677,049                      | )      |
| Net assets                                               |   |      |   | 20,893                            |   | 33,628                            |   | 28,976                            |   | 62,577                            |   |
|                                                     |   |      |   |                              |   |                              |   |                              |   |                              |   |
| Capital Reserves                                         |   |      |   |                              |   |                              |   |                              |   |                              |   |
| Called up share  capital                                 |   | 9         |   | 12,502                            |   | 20,122                            |   | 12,502                            |   | 12,502                            |   |
| Profit and loss  account                                 |   | 10        |   | 8,391                             |   | 13,506                            |   | 16,474                            |   | 50,075                            |   |
| Equity  shareholders’ funds                         |   | 10        |   | 20,893                            |   | 33,628                            |   | 28,976                            |   | 62,577                            |   |

 

The accounts on pages 5 to 19 were approved by the Board on 23 May 2003.

 

Director:

 

B D Needham

 

The accompanying notes are an integral part of these accounts.

 

F-6

----

 

**ONOFINANCE PLCNOTES TO THE ACCOUNTSFOR THE YEAR ENDED 31 DECEMBER 2002**

 

1.                                 **Accounting policies**

 

The principal accounting policies are summarised below.They have all been applied consistently throughout the period.

 

**Basis of accounting**

The accounts have been prepared under the historicalcost convention and in accordance with applicable accounting standards in theUnited Kingdom.

 

**Loans**

Borrowings are included as liabilities in the balancesheet at their proceeds, net of discount and expenses. The expenses anddiscount are charged to loan interest in the profit and loss account over theterm of the borrowing, using the effective interest method.  Funds on lent to Cableuropa S.A.U. and itssubsidiary companies (the Cableuropa Group) are accounted for in exactly thesame manner in order to match the borrowing and the debtor treatment.

 

**Finance costs**

Finance costs on borrowings are recognised in theprofit and loss account over the term of such instruments at a constant rateover the period of the instrument.

 

**Foreign exchange**

Transactions in foreign currencies are translated intosterling at the rates of exchange current at the dates of the transactions. Foreigncurrency monetary assets and liabilities in the balance sheet are translatedinto sterling at the rates of exchange ruling at the end of the year. Theresulting gain or loss is included as an exchange gain or loss in the profitand loss account.

 

**Taxation**

Corporation tax payable is provided on taxable profitsat the current rate.  Deferred taxationis provided using the liability method on all timing differences only to theextent that they are expected to reverse in the future without being replaced.

 

**Cash flow statement**

The company has taken advantage of the exemption inFinancial Reporting Standard No 1 ‘Cash Flow Statements (revised 1996)’ fromproducing a cash flow statement on the grounds that it is a subsidiaryundertaking where more than 90 per cent of the voting rights are controlledwithin a group and consolidated accounts for that group are publicly available.

 

**Convenience translation**

The financial statements are stated in United Kingdompounds. The conversions of United Kingdom pound amounts into United StatesDollars are included solely for the convenience of readers, using the noonbuying rate certified for customs purposes by the Federal Reserve Bank of NewYork as of 31 December 2002, which was US$1.6095 to £1.

 

F-7

----

 

The convenience translations should not be construedas representations that the United Kingdom pound amounts have been, could havebeen, or could in the future be, converted into United States Dollars at thisor any other rate of exchange.

 

**Revaluation of listed investments**

Equity value certificates held as current tradingassets are stated at market value and profits and losses arising from thisvaluation are taken to the revaluation reserve. This is in accordance with theAlternative Accounting Rules noted in the Companies Act 1985.

 

2.                                 **Interest receivable and similar income**

 

The interest receivable and similar income representsthe interest receivable on the funds that have been on-lent to the CableuropaGroup together with the amortisation of an upfront fee received from theCableuropa Group and also the amortisation of a fee receivable for maintenanceof the facilities.  The amortisation ofthe aforementioned fees is being recorded using the effective interest method.

 

3.                                 **Interest payable and similar charges**

 

The interest payable and similar charges represent theinterest incurred on the debentures issued (see note 8), together with theamortisation of the both costs incurred and the discount on the issue of thosedebentures.

 

4.                                 **Taxation**

 
|                                 |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2001** |   | **Year ended 31  December  2000** |   |
|--------------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|
|                                 |   | **£**                        |   | **US$**                           |   | **£**                        |   | **£**                        |   |
|                                 |   |                              |   |                              |   |                              |   |                              |   |
| UK corporation tax @ 20%             |   | 15,250                            |   | 24,544                            |   | 17,743                            |   | 10,131                            |   |
| Adjustment in respect to prior years |   | (5,915                            | )      | (9,519                            | )      |                              |   |                              |   |
| Group relief                         |   | —                            |   | —                            |   | —                            |   | (10,131                           | )      |
|                                 |   | 9,335                             |   | 15,025                            |   | 17,743                            |   | —                            |   |

 

The current tax charge disclosed in the profit andloss account on page 5 is equal to the profit on ordinary activities multipliedby the standard rate less the adjustment in respect of prior years above.

 

No temporary timing differences have arisen on thetransactions of the company which would lead to a deferred tax charge/(credit)in the profit and loss account.

 

5.                                 **Dividends**

 
|                                |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2001** |   | **Year ended 31  December  2000** |   |
|-------------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|
|                                |   | **£**                        |   | **US$**                           |   | **£**                        |   | **£**                        |   |
|                                |   |                              |   |                              |   |                              |   |                              |   |
| Proposed (£1.50 per share)     |   | 75,000                            |   | 120,713                           |   | 75,000                            |   | —                            |   |
| Adjustment in respect of prior year |   | (3                                | )      | (5                                | )      | —                            |   | —                            |   |
|                                |   | 74,997                            |   | 120,708                           |   | 75,000                            |   | —                            |   |

 

The adjustment in respect of the prior year relates tothe waiver of the 2001 dividend by Cableuropa S.A.U.

 

F-8

----

 

6.                                 **Debtors**

 
|                                                                     |   | **31 December  2002** |   | **31 December  2002** |   | **31 December  2001** |   | **31 December  2000** |   |
|--------------------------------------------------------------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|--------|
|                                                                     |   | **£**            |   | **US$**               |   | **£**            |   | **£**            |   |
|                                                                     |   |                  |   |                  |   |                  |   |                  |   |
| Receivable after  more than one year                                     |   |                  |   |                  |   |                  |   |                  |   |
| Loans to the  Cableuropa Group                                           |   | 555,646,369           |   | 894,312,831           |   | 565,865,404           |   | 374,028,569           |   |
| Amounts due from  Cableuropa in respect of the equity value certificates |   | 16,563,226            |   | 26,658,512            |   | —                |   | —                |   |
|                                                                     |   | 572,209,595           |   | 920,971,343           |   | 565,865,404           |   | 374,028,569           |   |
| Receivable  within one year:                                             |   |                  |   |                  |   |                  |   |                  |   |
| Amounts due from  Cableuropa in respect of the equity value certificates |   | —                |   | —                |   | 47,098,354            |   | 7,512,276             |   |
| Indebtedness  with holding company                                       |   | 7,059                 |   | 11,362                |   | —                |   | —                |   |
| Indebtedness  with the Cableuropa Group                                  |   | 59,924,542            |   | 96,448,550            |   | 61,484,468            |   | 18,623,032            |   |
|                                                                     |   | 632,141,196           |   | 1,017,431,255         |   | 674,448,226           |   | 400,163,877           |   |

 

The loans to the Cableuropa Group reflect the on-lendingof the gross loans that are included in creditors (see note 8) and arerepayable on the same terms. These are denominated in the same currencies.  The loans bear interest at 13.214%, 14.01%and 16.252% per annum.

 

7.                                 **Creditors: amounts falling due within one year**

 
|                                    |   | **31 December  2002** |   | **31 December  2002** |   | **31 December  2001** |   | **31 December  2000** |   |
|-----------------------------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|--------|
|                                    |   | **£**            |   | **US$**               |   | **£**            |   | **£**            |   |
|                                    |   |                  |   |                  |   |                  |   |                  |   |
| UK taxation                             |   | 15,250                |   | 24,544                |   | 17,743                |   | —                |   |
| Proposed  dividend                      |   | 75,000                |   | 120,712               |   | 75,000                |   | —                |   |
| Equity value  certificates (see note 8) |   | —                |   | —                |   | —                |   | 7,512,276             |   |
| Accruals and  deferred income           |   | 28,887,965            |   | 46,495,181            |   | 29,218,086            |   | 14,924,450            |   |
|                                    |   | 28,978,215            |   | 46,640,437            |   | 29,310,829            |   | 22,436,726            |   |

 

The accruals and deferred income represents theinterest payable on the Notes and the short-term portion of the amortisationfor the maintenance fee in respect to the 1999 and 2001 bonds.

 

8.                                 **Creditors: amounts falling due after more than oneyear**

 
|                                                           |   | **31  December  2002** |   | **31  December  2002** |   | **31  December  2001** |   | **31  December  2000** |   |
|----------------------------------------------------------------|--------|------------------------|--------|------------------------|--------|------------------------|--------|------------------------|--------|
|                                                           |   | **£**             |   | **US$**                |   | **£**             |   | **£**             |   |
| Loans:                                                         |   |                   |   |                   |   |                   |   |                   |   |
| 13% US$ 275m  Notes due 2009                                   |   | 165,390,534            |   | 266,196,065            |   | 182,435,188            |   | 176,527,834            |   |
| 13% Euro 125m  Notes due 2009                                  |   | 78,838,661             |   | 126,890,824            |   | 73,809,873             |   | 75,661,291             |   |
| 14% Euro 200m  Notes due 2010                                  |   | 127,172,669            |   | 204,684,410            |   | 119,285,146            |   | 122,509,458            |   |
| 14% US$ 200m  Notes due 2011                                   |   | 107,162,587            |   | 172,478,183            |   | 116,483,798            |   | —                 |   |
| 14% Euro 150m  Notes due 2011                                  |   | 84,286,053             |   | 135,658,403            |   | 77,759,832             |   | —                 |   |
| Equity value  certificates relating to the 1999 and 2001 bonds |   | 16,563,226             |   | 26,658,512             |   | 47,098,354             |   | —                 |   |
| Accruals and  deferred income                                  |   | 23,814,103             |   | 38,328,800             |   | 28,260,093             |   | 2,978,466              |   |
|                                                           |   | 603,227,833            |   | 970,895,197            |   | 645,132,284            |   | 377,677,049            |   |

 

All of these Notes are repayable after more than 5years.

 

The 13% Notes 2009 will mature on 1 May2009. However, the company may redeem some or all of the Notes at any time onor after 1 May 2004.

 

F-9

----

 

The 14% Notes 2010 will mature on 15July 2010. However, the company may redeem some or all of the Notes on or after15 July 2005. In addition, prior to 15 July 2003, the company may redeem up to35% of the Notes with the proceeds of certain offerings of ordinary shares ofCableuropa S.A.U.

 

The 14% Notes 2011 will mature on 15February 2011. However, the Issuer may redeem some or all of the Notes at anytime on or after 15 February 2006. In addition, prior to 15 February 2004, theIssuer may redeem up to 35% of the Notes with the proceeds of certain offeringsof ordinary shares of Cableuropa S.A.U.

 

13% US$275m Notes 275,000 units of$1,000 principal amount of dollar Notes and one dollar Equity value certificatewere issued on 6 May 1999 at a discounted price of US$984.59. Expenses ofUS$8,937,500 were incurred. Both the expenses and discount have been nettedfrom the gross amount of the loan and are being amortised over the period ofthe loan. 182,902 Notes were then cancelled on 13 February 2003. Theunamortised amount at the balance sheet date of the 275,000 units was US$8,366,388 (2001: US$ 9,684,506, 2000: US$ 11,002,624).  The Equity value certificates entitle theirholders to receive cash in an amount equal to the market value of a number ofshares of Cableuropa S.A.U.

 

13% Euro125m Notes 125,000 units ofEuro1,000 principal amount of Euro Notes and one Euro Equity value certificatewere issued on 6 May 1999 at a discounted price of Euro 984.59. Expenses ofEuro 4,062,500 were incurred. Both the expenses and the discount have beennetted from the gross amount of the loan and are being amortised over theperiod of the loan.

 

F-10

----

 

79,372 Notes were then cancelled on 13 February 2003.The unamortised amount at the balance sheet date of the 125,000 units was Euro3,802,904 (2001 Euro 4,402,049, 2000: Euro 5,001,193).  The Equity value certificates entitle theirholders to receive cash in an amount equal to the market value of a number ofshares of Cableuropa S.A.U.

 

14% Euro200m Notes 200,000 units ofEuro 1,000 principal amount were issued on 30 June 2000 at a discounted priceof Euro 970. The discount has been netted from the gross amount of the loan andis being amortised over the period of the loan. 86,298 Notes were thencancelled on 13 February 2003. The unamortised amount at the balance sheet dateof the 200,000 units was Euro 4,500,000 (2001 Euro 5,100,000, 2000: Euro5,700,000). The expenses of this issue have been borne by Cableuropa S.A.U.

 

14% US$200m Notes 200,000 units of$1,000 principal amount of dollar Notes and one dollar Equity value certificatewere issued on 9 February 2001 at a discounted price of US$862.04. Expenses ofUS$6,000,000 were incurred. Both the expenses and discount have been nettedfrom the gross amount of the loan and are being amortised over the period ofthe loan. 116,486 Notes were then cancelled on 13 February 2003. Theunamortised amount at the balance sheet date of the 200,000 units was US$27,238,314 (2001 US$ 30,597,613). The Equity value certificates entitle theirholders to receive cash in an amount equal to the market value of a number ofshares of Cableuropa S.A.U.

 

14% Euro150m Notes 150,000 units ofEuro1,000 principal amount of Euro Notes and one Euro Equity value certificatewere issued on 9 February 2001 at a discounted price of Euro 862.04. Expensesof Euro 4,500,000 were incurred. Both the expenses and the discount have beennetted from the gross amount of the loan and are being amortised over theperiod of the loan. 37,947 Notes were then cancelled on 13 February 2003. Theunamortised amount at the balance sheet date of the 150,000 units was Euro20,428,736 (2001 Euro 22,948,210). The Equity value certificates entitle theirholders to receive cash in an amount equal to the market value of a number ofshares of Cableuropa S.A.U.

 

All the Notes are fully and conditionally guaranteed,jointly and severally on a subordinated unsecured basis by companies in theCableuropa Group

 

The Equity value certificates relating to the 1999bonds are only separable from the Notes when certain conditions are met.Subject to these conditions, the Equity value certificates will be redeemableat the earliest of an initial public offering of Cableuropa S.A.U. or areorganisation of the Cableuropa Group or 31 May 2009.  The Equity value certificates relating tothe 2001 bonds are only separable from the Notes when certain conditions aremet. Subject to these conditions, the Equity value certificates will beredeemable at the earliest of an initial public offering of Cableuropa S.A.U.or a reorganisation of the Cableuropa Group or 16 March 2011.

 

9.                                 **Called up share capital**

 

The authorised and issued share capital of the Companyis £50,000 divided into 50,000 ordinary shares of £1 each, of which two fullypaid shares and 49,998 shares paid up to one quarter have been issued.

 

F-11

----

 

The issued share capital is paid up as follows: -

 
|                                                                                    |   | **31 December  2002** |   | **31 December  2002** |   | **31 December  2001** |   | **31 December  2000** |   |
|-----------------------------------------------------------------------------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|--------|-----------------------|--------|
|                                                                                    |   | **£**            |   | **US$**               |   | **£**            |   | **£**            |   |
| 2 fully paid  shares of £1 each, issued at par on incorporation                    |   | 2                     |   | 3                     |   | 2                     |   | 2                     |   |
| 49,998 paid up  to one-quarter shares of £1 each, issued at par on 4 February 1999 |   | 12,500                |   | 20,119                |   | 12,500                |   | 12,500                |   |
|                                                                                    |   | 12,502                |   | 20,122                |   | 12,502                |   | 12,502                |   |

 

10.                           **Reconciliation of movements in equity shareholders’funds**

 
|                                             |   | **Share   capital  2002** |   | **Profit and  loss account  2002** |   | **Total  2002** |   | **Total  2001** |   | **Total  2000** |   |
|--------------------------------------------------|--------|---------------------------|--------|------------------------------------|--------|-----------------|--------|-----------------|--------|-----------------|--------|
|                                             |   | **£**                |   | **£**                         |   | **£**      |   | **£**      |   | **£**      |   |
|                                             |   |                      |   |                               |   |            |   |            |   |            |   |
| Opening equity  shareholders’ funds         |   | 12,502                    |   | 16,474                             |   | 28,976          |   | 62,577          |   | 28,806          |   |
| Retained  (loss)/profit for the financial period |   | —                    |   | (8,083                             | )      | (8,083          | )      | (33,601         | )      | 33,771          |   |
| Closing equity  shareholders’ funds         |   | 12,502                    |   | 8,391                              |   | 20,893          |   | 28,976          |   | 62,577          |   |

 

11.                           **Ultimate parent undertaking and controlling party**

 

ONO Finance (Holdings) Limited is the immediate parentundertaking of the company. The shares of ONO Finance (Holdings) Limited are inturn held by Royal Exchange Trust Company Limited under the terms of aDeclaration of Trust for charitable purposes. Copies of those group accountsmay be obtained from the Registrar of Companies.

 

Cableuropa S.A.U., a company incorporated in Spain, isthe largest group of which the company is a member (2% owned) and for whichgroup accounts are drawn up. Copies of those group accounts may be obtainedfrom Edificio Belagua, calle Basauri 7-9, Urbanización La Florida, 28023Aravaca, Madrid, Spain.

 

12.                           **Related party transactions**

 

The company has taken advantage of the exemption inFinancial Reporting Standard No 8 from disclosing transactions with its holdingcompany on the grounds that it is more than 90% owned.

 

The company is owned 98% by ONO Finance (Holdings)Limited and 2% owned by Cableuropa S.A.U. ONO Finance (Holdings) Limited has borne all administrative expenses ofthe company, including legal, accounting and rental costs.  Accordingly, no administrative expenses havebeen recorded in the accompanying financial accounts. In addition, thedirectors receive no emoluments from the company.

 

F-12

----

 

13.                           **US GAAP**

 

**Reconciliation of shareholders’equity and net (loss)/profit**

** **
|                                                  |   | **Year  ended 31  December  2002** |       | **Year  ended 31  December  2002** |       | **Year  ended 31  December  2001** |       | **Year  ended 31  December  2000** |       |
|-------------------------------------------------------|--------|------------------------------------|------------|------------------------------------|------------|------------------------------------|------------|------------------------------------|------------|
|                                                  |   | **£**                         |       | **US$**                            |       | **£**                         |       | **£**                         |       |
| **Reconciliation of shareholders  equity**            |   |                               |       |                               |       |                               |       |                               |       |
|                                                  |   |                               |       |                               |       |                               |       |                               |       |
| Shareholders’  equity in accordance with UK GAAP |   | 20,893                             |       | 33,627                             |       | 28,976                             |       | 62,577                             |       |
| Proposed  dividend and waiver of prior year dividend  |   | 74,997                             |       | 120,708                            |       | 75,000                             |       | —                             |       |
| Shareholders  equity in accordance with US GAAP       |   | 95,890                             |       | 154,335                            |       | 103,976                            |       | 62,577                             |       |
|                                                  |   |                               |       |                               |       |                               |       |                               |       |
| **Reconciliation  of net (loss)/profit**              |   |                               | ** ** |                               | ** ** |                               | ** ** |                               | ** ** |
|                                                  |   |                               |       |                               |       |                               |       |                               |       |
| Net  (loss)/profit in accordance with UK GAAP         |   | (8,083                             | )          | (13,010                            | )          | (33,601                            | )          | 33,771                             |       |
| Proposed  dividend and waiver of prior year dividend  |   | 74,997                             |       | 120,708                            |       | 75,000                             |       | —                             |       |
| Net  profit in accordance with US GAAP           |   | 66,914                             |       | 107,698                            |       | 41,399                             |       | 33,771                             |       |

 

**Proposed dividends**

 

Under UK GAAP proposed dividends are presented as adeduction at the foot of the profit and loss account, whereas under US GAAP,dividends are shown when declared, as a deduction in the statement of changesin stockholders’ equity.

 

F-13

----

 

**Use of Estimates in the Preparationof the Financial Statements**

 

The preparation of the financial statements inconformity with generally accepted accounting principles requires management tomake estimates and assumptions that affect the reported amounts and disclosureof assets and liabilities and disclosure of contingent assets and liabilitiesat the date of the financial statements, and the reported amounts of revenueand expenses during the reported period. Actual results could differ from thoseestimates.

 

**Cash and cash equivalents**

 

Cash and cash equivalents consist of all cash inbanks, cash in hand, and other equivalent instruments with original maturitiesof three months or less.

 

**Debt issuance costs**

 

Under UK GAAP, debt issuance costs of £15,072,855 arenetted against the carrying value of the related debt.  Under US GAAP, these costs are reclassifiedas a long-term asset and amortised over the period of the debt.  This difference in classification gives riseto no differences in reported shareholders equity and net income.

 

The company has considered the impact of newaccounting standards in the UK and the US and does not expect them have amaterial impact on the company’s financial statements.

 

**Revaluation of Equity ValueCertificates**

 

Under UK GAAP, changes in the value of the Equityvalue certificates are recorded in the statement of recognised gains andlosses.  Under US GAAP, such amounts arerecorded under other comprehensive income. However, as the decrease in the value of the Equity value certificatesrelated to the Company’s debt obligations is equivalent to the decrease in thevalue of the related receivable from Cableuropa S.A.U., there are nodifferences between net income, comprehensive income or shareholders’ equitybetween US and UK GAAP.

 

**Income taxes**

 

Provision for taxation has been made at the rate of20%.

 

There are no temporary differences giving rise todeferred taxes in accordance with US generally accepted accounting principles.

 

F-14

----

 

**Financial instruments**

 
| **31  December 2002** |   | **Notional  amount** |   | **Carrying  amount** |   | **Fair  value** |   |
|-----------------------|--------|----------------------|--------|----------------------|--------|-----------------|--------|
|                  |   | **£**           |   | **£**           |   | **£**      |   |
| 13% US$ Notes 2009    |   | 170,580,133          |   | 165,390,534          |   | 55,438,543      |   |
| 13% Euro Notes  2009  |   | 81,312,448           |   | 78,838,661           |   | 26,426,546      |   |
| 14% Euro Notes  2010  |   | 130,099,917          |   | 127,172,669          |   | 42,282,473      |   |
| 14% US$ Notes  2011   |   | 124,058,279          |   | 107,162,587          |   | 40,318,940      |   |
| 14% Euro Notes  2011  |   | 97,574,938           |   | 84,286,053           |   | 31,711,855      |   |
|                  |   | 603,625,715          |   | 562,850,504          |   | 196,178,357     |   |

 
| **31 December 2002** |   | **Notional  amount** |   | **Carrying  amount** |   | **Fair  value** |   |
|----------------------|--------|----------------------|--------|----------------------|--------|-----------------|--------|
|                 |   | **US$**              |   | **US$**              |   | **US$**         |   |
| 13% US$ Notes  2009  |   | 275,000,000          |   | 266,196,065          |   | 89,228,335      |   |
| 13% Euro Notes  2009 |   | 131,087,500          |   | 126,890,824          |   | 42,533,526      |   |
| 14% Euro Notes  2010 |   | 209,740,000          |   | 204,684,410          |   | 68,053,640      |   |
| 14% US$ Notes  2011  |   | 200,000,000          |   | 172,478,183          |   | 64,893,334      |   |
| 14% Euro Notes  2011 |   | 157,305,000          |   | 135,658,403          |   | 51,040,231      |   |
|                 |   | 973,132,500          |   | 905,907,886          |   | 315,749,066     |   |

 
| **31 December 2001** |   | **Notional  amount** |   | **Carrying  amount** |   | **Fair  value** |   |
|----------------------|--------|----------------------|--------|----------------------|--------|-----------------|--------|
|                 |   | **£**           |   | **£**           |   | **£**      |   |
| 13% US$ Notes  2009  |   | 189,094,410          |   | 182,435,188          |   | 145,602,695     |   |
| 13% Euro Notes  2009 |   | 76,504,070           |   | 73,809,873           |   | 58,908,134      |   |
| 14% Euro Notes  2010 |   | 122,406,512          |   | 119,285,146          |   | 96,701,145      |   |
| 14% US$ Notes  2011  |   | 137,523,207          |   | 116,483,798          |   | 108,643,334     |   |
| 14% Euro Notes  2011 |   | 91,804,884           |   | 77,759,832           |   | 72,525,858      |   |
|                 |   | 617,333,083          |   | 569,773,837          |   | 482,381,166     |   |

 
| **31 December 2001** |   | **Notional  amount** |   | **Carrying  amount** |   | **Fair   value** |   |
|----------------------|--------|----------------------|--------|----------------------|--------|------------------|--------|
|                 |   | **US$**              |   | **US$**              |   | **US$**          |   |
| 13% US$ Notes  2009  |   | 275,000,000          |   | 265,315,494          |   | 211,750,000      |   |
| 13% Euro Notes  2009 |   | 111,259,869          |   | 107,341,699          |   | 85,670,099       |   |
| 14% Euro Notes  2010 |   | 178,015,790          |   | 173,476,388          |   | 140,632,474      |   |
| 14% US$ Notes  2011  |   | 200,000,000          |   | 169,402,387          |   | 158,000,000      |   |
| 14% Euro Notes  2011 |   | 133,511,843          |   | 113,086,124          |   | 105,474,356      |   |
|                 |   | 897,787,502          |   | 828,622,092          |   | 701,526,929      |   |

 
| **31 December 2000** |   | **Notional  amount** |   | **Carrying  amount** |   | **Fair  value** |   |
|----------------------|--------|----------------------|--------|----------------------|--------|-----------------|--------|
|                 |   | **£**           |   | **£**           |   | **£**      |   |
| 13% US$ Notes  2009  |   | 183,884,988          |   | 176,527,834          |   | 136,330,000     |   |
| 13% Euro Notes  2009 |   | 78,814,628           |   | 75,661,291           |   | 58,376,800      |   |
| 14% Euro Notes  2010 |   | 126,103,405          |   | 122,509,458          |   | 95,927,200      |   |
|                 |   | 388,803,021          |   | 374,698,583          |   | 290,634,000     |   |

 

F-15

----

 

The company could be exposed to credit related lossesdue to the debt financing in place. The fair value is based on the quotedmarket value of the Notes at 31 December 2002, 2001 and 2000.

 

**Cash flow statement**

** **
|                                                         |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2002** |   | **Year ended 31  December  2001** |   | **Year ended 31  December  2000** |   |
|--------------------------------------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|
|                                                         |   | **£**                        |   | **US$**                           |   | **£**                        |   | **£**                        |   |
| Cash flows from  operating activities:                       |   |                              |   |                              |   |                              |   |                              |   |
| Net income                                                   |   | 76,249                            |   | 122,723                           |   | 59,142                            |   | 33,771                            |   |
| **Adjustments  to reconcile net income to net cash**         |   |                              |   |                              |   |                              |   |                              |   |
| Foreign exchange  transaction (gain)/loss                    |   | (13,000                           | )      | (20,924                           | )      | 57                                |   | (1,322                            | )      |
| Amortisation of  debt issuance costs and debt discount       |   | 5,320,321                         |   | 8,563,057                         |   | 5,074,892                         |   | 1,448,315                         |   |
| Accretion of  discount on Notes receivable                   |   | (5,320,321                        | )      | (8,563,057                        | )      | (5,074,892                        | )      | (1,448,315                        | )      |
| Non cash  interest payable                                   |   | 17,607,776                        |   | 28,339,715                        |   | 52,136,533                        |   | 42,537,069                        |   |
| Non cash  interest receivable                                |   | (17,607,776                       | )      | (28,339,715                       | )      | (52,175,922                       | )      | (42,569,531                       | )      |
| Dividend paid                                                |   | (74,997                           | )      | (120,708                          | )      |                              |   |                              |   |
| Interest  received from prior years                          |   | 79,664                            |   | 128,219                           |   |                              |   |                              |   |
| Increase in  debtors                                         |   | (6,034                            | )      | (9,711                            | )      | —                            |   | —                            |   |
| (Decrease) in  creditors                                     |   | —                            |   | —                            |   | (8,422                            | )      | (4                                | )      |
| Total  adjustments                                           |   | (14,367                           | )      | (23,124                           | )      | (47,754                           | )      | (33,788                           | )      |
| Net cash  inflow/(outflow) from operating activities         |   | 61,882                            |   | 99,599                            |   | 11,388                            |   | (17                               | )      |
|                                                         |   |                              |   |                              |   |                              |   |                              |   |
| Cash flows from  financing activities issue of share capital |   | —                            |   | —                            |   | —                            |   | —                            |   |
|                                                         |   |                              |   |                              |   |                              |   |                              |   |
| Net  (decrease)/increase in cash and cash equivalents        |   | 61,882                            |   | 99,599                            |   | 11,388                            |   | (17                               | )      |
|                                                         |   |                              |   |                              |   |                              |   |                              |   |
| Cash and cash  equivalents, at beginning of period           |   | 23,863                            |   | 38,408                            |   | 12,475                            |   | 12,492                            |   |
|                                                         |   |                              |   |                              |   |                              |   |                              |   |
| Cash and cash  equivalent, at end of period                  |   | 85,745                            |   | 138,007                           |   | 23,863                            |   | 12,475                            |   |

 

Non-cash investing and financing activitiesdisclosure:

The cash proceeds from the debt issuance were receiveddirectly by Cableuropa S.A.U. Accordingly, the cash flow statement does not reflect receipt of theseproceeds and a subsequent disbursement to Cableuropa S.A.U.

 

F-16

----

 

**Accounting for derivative instrumentsand hedging activities**

 

The company has considered the impact of newaccounting standards in the UK and the US and does not expect them have amaterial impact on the company’s financial statements.

 

14.                           **Subsequent events**

 

On 13 February 2003 a significant portion of the highyield debt has been cancelled. This was the result of the sole shareholder ofthe Cableuropa Group, Grupo Corporativo ONO, S.A. (“GCO”), purchasing the bondsin the open market and through a tender offer announced on 20 November 2002.The details of the amounts are included in note 8. Although this means thatgoing forward, the margin made on the on-lending to the Cableuropa Group willdecrease, Cableuropa S.A.U. agreed to pay to ONO Finance (Holdings) Limited aone-off fee of £93K and an on-going annual fee of £65K in recognition of thecompany agreeing to the cancellation.

 

The principal amount of each series of Notes as of 23December 2002 (payment date of the tender offer) including Notes purchased inthe open market and accepted in the tender offer, is shown in the followingtable:

 
|                     |   | **Face value  (Thousand of EUR or US$ as applicable)** |   |
|--------------------------|--------|--------------------------------------------------------|--------|
|                     |   | **Open Market**                                        |   | **Tender Offer** |   | **Total** |   |
|                     |   |                                                   |   |   |   |   |   |
| 13% Euro Notes  due 2009 |   | 23,990                                                 |   | 55,382 |   | 79,372 |   |
| 13% US$ Notes  due 2009  |   | 47,300                                                 |   | 135,602 |   | 182,902 |   |
| 14% Euro Notes  due 2010 |   | 20,023                                                 |   | 66,275 |   | 86,298 |   |
| 14% Euro Notes  due 2011 |   | 24,135                                                 |   | 43,812 |   | 67,947 |   |
| 14% US$ Notes  due 2011  |   | 39,900                                                 |   | 76,586 |   | 116,486 |   |

 

The purpose of the tender offer and the open marketpurchase of Notes was to reduce the level of indebtedness of the CableuropaGroup.

 

As a part of the process of the cancellation of theNotes, on 13 February 2003 Cableuropa, S.A.U. and its subsidiaries agreed withONO Finance PLC the required amendments to reflect the partial cancellation ofdebt of Cableuropa, S.A.U. and its subsidiaries with ONO Finance PLC throughthe multi-borrower credit facilities.

 

F-17

----

 

As of 13 February 2002, GCO had sold all of the Notesto the Cableuropa Group other than Euro 30 million of 2011 Notes that isretained. At the same time the Cableuropa Group transferred the Notes to ONOFinance PLC in exchange for a reduction in the amounts owed under themulti-borrower credit facilities.

 

The loans to the Cableuropa Group as well as theoutstanding Notes after the cancellation on 13 February 2003, are as follows:

 
|                 |   | **Thousand of Euro or US$ (as applicable)** |   |
|----------------------|--------|---------------------------------------------|--------|
|                 |   | **Outstanding  Bonds**                      |   | **Outstanding Loans to the  Cableuropa Group** |   |
|                 |   | **Face**                                    |   | **Interest  Rate** |   | **Total loan  @ maturity** |   | **Interest  Rate** |   |
|                 |   |                                        |   |   |   |   |   |   |   |
| Euro Notes due  2009 |   | 45,628                                      |   | 13.00 |   | 45,628 |   | 13.214 |   |
| US$ Notes due  2009  |   | 92,098                                      |   | 13.00 |   | 92,098 |   | 13.214 |   |
| Euro Notes due  2010 |   | 113,702                                     |   | 14.00 |   | 113,702 |   | 14.010 |   |
| Euro Notes due  2011 |   | 112,053                                     |   | 14.00 |   | 112,053 |   | 16.252 |   |
| US$ Notes due  2011  |   | 83,514                                      |   | 14.00 |   | 83,514 |   | 16.252 |   |

 

The Equity value certificates on these Notes have beenclassified as being due in more than 1 year.

 

15.                           **Derivatives and other financial instruments**

 

The company’s financial instruments compriseborrowings, debtors and creditors that arise as a result of normal operations.  The company does trade in financialinstruments.

 

The main risk arising from the company’s financialinstruments is foreign currency risk. However, as the onward lendings to Cableuropa Group are in the samecurrencies as the borrowings, any foreign currency exposure should beminimal.  Details can be found in notes6 and 8.

 

F-18

----

 

*Maturity of financial instruments*

The maturity profiles of the company’s financialinstruments are detailed in notes 6 and 8.

* *

*Fair values*

The fair value of the financial liabilities at 31December 2002 is detailed in note 13. The fair values of the financial assets are not materially differentfrom their book value as detailed in note 6.

* *

*Interest rate risk*

The company is not exposed to interest rate risk asall interest rates on financial instruments are fixed as detailed in notes 6and 8 and finance raised by the issue of the financial instruments aresubsequently on lent at similar fixed rates of interest.

 

F-19

----