America Online 2009 Annual Report Download - page 59

Table of Contents
Cash used by financing activities was $749.6 million for the year ended December 31, 2009, compared to $134.9 million of cash provided by financing
activities in the year ended December 31, 2008. This change was due to the $709.3 million of net cash distributed to Time Warner in 2009, compared to
$210.4 million of net cash contributed by Time Warner in 2008. Cash was contributed by Time Warner in 2008 as a result of our significant acquisitions in
2008, which required cash in excess of the amount generated by operations.
Cash provided by financing activities for the year ended December 31, 2008 was $134.9 million, compared to cash used by financing activities of
$1,425.3 million for the year ended December 31, 2007. This change was due to the $210.4 million of net cash contributed by Time Warner in 2008 due to
our acquisition activity, compared to $1,390.3 million of net cash distributed to Time Warner in 2007. In 2007, we also spent cash on acquisitions in excess of
the cash provided by operations; however, we received proceeds from the sales of Tegic and the German and United Kingdom access service businesses in
that year, which allowed us to distribute cash to Time Warner.
Principal Debt Obligations
On December 9, 2009, we entered into the Revolving Credit Facility. Time Warner guaranteed all of our obligations under the Revolving Credit
Facility, pursuant to a guarantee dated as of December 9, 2009. The maturity date of the Revolving Credit Facility is December 8, 2010. Borrowings under the
Revolving Credit Facility are available for general corporate purposes. Loans made under the Revolving Credit Facility will bear interest at a fluctuating rate
based on the applicable rating for the senior unsecured long-term debt of Time Warner. As of March 2, 2010, we have not borrowed under the terms of our
Revolving Credit Facility. See "Note 5: Long-Term Debt and Other Financing Arrangements" in our accompanying consolidated financial statements for
additional information.
Contractual Obligations and Commitments
We have obligations under certain contractual arrangements to make future payments for goods and services. These contractual obligations secure the
future rights to various assets and services to be used in the normal course of operations. For example, we are contractually committed to make certain
minimum lease payments for the use of property under operating lease agreements. In accordance with applicable accounting rules, the future rights and
obligations pertaining to firm commitments, such as operating lease obligations and certain purchase obligations under contracts, are not reflected as assets or
liabilities in the accompanying consolidated balance sheets.
The following table presents certain payments due under contractual obligations with minimum firm commitments as of December 31, 2009 (in
millions):
Total 2010 2011-2012 2013-2014 Thereafter
Capital lease obligations $ 79.6 $ 35.8 $ 39.6 $ 4.2 $ —
Operating lease obligations 412.9 62.8 94.9 63.7 191.5
Purchase obligations 137.6 96.8 32.9 7.0 0.9
Total contractual obligations $ 630.1 $ 195.4 $ 167.4 $ 74.9 $ 192.4
The following is a description of our material contractual obligations at December 31, 2009:
• Capital lease obligations represent the minimum lease payments under non-cancelable capital leases, primarily for network equipment financed
under capital leases. See "Note 5: Long-Term Debt and Other Financing Arrangements" in our accompanying consolidated financial statements
for more information.
• Operating lease obligations represent the minimum lease payments under non-cancelable operating leases, primarily for our real estate and
operating equipment in various locations around the world. Included in the above table are approximately $230.7 million of payments associated
with the lease of our corporate headquarters in New York. We have leased our corporate headquarters for a non-cancelable
55