Charter 2003 Annual Report Download - page 90

Related Party Transactions
See ""Certain Relationships and Related Transactions Ì Business Relationships'' in the Charter Com-
munications, Inc. 2004 Proxy Statement available at www.sec.gov for information regarding related party
transactions and transactions with other parties with whom we or our related parties may have a relationship.
Certain Trends and Uncertainties
The following discussion highlights a number of trends and uncertainties, in addition to those discussed
elsewhere in this annual report and in other documents that we Ñle with the SEC, that could materially impact
our business, results of operations and Ñnancial condition.
Substantial Leverage. We and our subsidiaries have a signiÑcant amount of debt. As of December 31,
2003, our total debt was approximately $18.6 billion. In 2004, $188 million of our debt matures, and in 2005
and 2006, an additional $1.0 billion and $1.2 billion matures, respectively. In subsequent years, substantial
additional amounts will become due under our remaining obligations. We believe that as a result of our
signiÑcant levels of debt, our access to the debt markets could be limited when substantial amounts of our
current indebtedness become due. If our business does not generate suÇcient cash Öow from operating
activities, and suÇcient funds are not available to us from borrowings under our credit facilities or from other
sources, we may not be able to repay our debt, grow our business, respond to competitive challenges, or to fund
our other liquidity and capital needs. Further, if we are unable to reÑnance that debt, ultimately, we could be
forced to restructure our obligations or seek protection under the bankruptcy laws. If we need to raise
additional capital through the issuance of equity or Ñnd it necessary to engage in a recapitalization or other
similar transaction, our shareholders could suÅer signiÑcant dilution and our noteholders might not receive all
principal and interest payments to which they are contractually entitled. For more information, see the section
above entitled ""Liquidity and Capital Resources.''
Restrictive Covenants. The credit facilities of our subsidiaries and the indentures governing the publicly
held notes of our subsidiaries contain a number of signiÑcant covenants that could adversely impact our
business. In particular, the credit facilities and indentures of our subsidiaries restrict our subsidiaries' ability
to:
‚ pay dividends or make other distributions;
‚ make certain investments or acquisitions;
‚ enter into related party transactions;
‚ dispose of assets or merge;
‚ incur additional debt;
‚ issue equity;
‚ repurchase or redeem equity interests and debt;
‚ grant liens; and
‚ pledge assets.
Furthermore, our subsidiaries' credit facilities require our subsidiaries to maintain speciÑed Ñnancial
ratios and meet Ñnancial tests. These Ñnancial ratios tighten and may become more diÇcult to maintain over
time. The ability to comply with these provisions may be aÅected by events beyond our control. The breach of
any of these covenants will result in a default under the applicable debt agreement or instrument and could
trigger acceleration of the related debt under the applicable agreement, and in certain cases under other
agreements governing our indebtedness. Any default under the credit facilities or indentures applicable to us
or our subsidiaries could adversely aÅect our growth, our Ñnancial condition and our results of operations and
the ability to make payments on the publicly held notes of Charter and our subsidiaries, and the credit
facilities of our subsidiaries. For more information, see the section above entitled ""Liquidity and Capital
Resources.''
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