Charter 2002 Annual Report Download - page 43

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market conditions and these downgrades, we have limited access to the debt market at this time and we expect
to fund our cash needs during 2003 from cash on hand, cash from operations and borrowings under the existing
credit facilities of our subsidiaries. EÅective April 14, 2003, we entered into a commitment letter with Vulcan
Inc., which is an aÇliate of Paul Allen, pursuant to which Vulcan Inc. agreed to lend, or cause an aÇliate to
lend initially to Charter Communications VII, LLC an aggregate amount of up to $300 million, which amount
includes a subfacility of up to $100 million for the issuance of letters of credit. See ""Ì Liquidity and Capital
Resources Ì Funding Commitment of Vulcan Inc.'' We recognize the interim nature of this facility and
continue to evaluate our options and to consider steps to address our leverage. We have hired an independent
consulting Ñrm to assist us in evaluating alternatives.
As noted above, our access to capital from the credit facilities of our subsidiaries is contingent on
compliance with a number of restrictive covenants, including covenants tied to our operating performance. We
may not be able to comply with all of these restrictive covenants. If there is an event of default under our
subsidiaries' credit facilities, such as the failure to maintain the applicable required Ñnancial ratios, we would
be unable to borrow under these credit facilities, which could materially adversely impact our ability to operate
our business and to make payments under our debt instruments. In addition, an event of default under certain
of our debt obligations, if not waived, may result in the acceleration of those debt obligations, which could in
turn result in the acceleration of other debt obligations, and could result in exercise of remedies by our
creditors and could force us to seek the protection of the bankruptcy laws. See ""Ì Credit Facility Terms,
Restrictions and Covenants'' below for a more detailed description of these covenant restrictions and cross-
default provisions.
Our signiÑcant amount of debt and the signiÑcant interest charges incurred to service debt may adversely
aÅect our ability to obtain Ñnancing in the future and react to changes in our business. We may need
additional capital if we do not achieve our projected revenues, or if our operating expenses increase. If we are
not able to obtain such capital from increases in our operating cash Öow, additional borrowings or other
sources, we may not be able to fund customer demand for digital video, data or telephony services, oÅer
certain services in certain of our markets or compete eÅectively. Consequently, our Ñnancial condition and
results of operations could suÅer materially.
41