Charter 2006 Annual Report Download - page 57

CHARTER COMMUNICATIONS, INC. 2006 FORM 10-K
In 2007, $130 million of our debt matures, and in 2008, an additional $50 million matures. In 2009 and beyond, significant additional
amounts will become due under our remaining long-term debt obligations. The following table summarizes our payment obligations
as of December 31, 2006 under our long-term debt and certain other contractual obligations and commitments (dollars in millions).
Payments by Period
Less than More than
Total 1 Year 1-3 Years 3-5 Years 5 Years
Contractual Obligations
Long-Term Debt Principal Payments(1) $18,964 $ 130 $ 928 $3,599 $14,307
Long-Term Debt Interest Payments(2) 11,811 1,768 3,543 3,097 3,403
Payments on Interest Rate Instruments(3) 1—1——
Capital and Operating Lease Obligations(4) 95 20 32 25 18
Programming Minimum Commitments(5) 854 349 505 ——
Other(6) 423 284 69 48 22
Total $32,148 $2,551 $5,078 $6,769 $17,750
(1) The table presents maturities of long-term debt outstanding as of December 31, 2006. Refer to Notes 9 and 23 to our accompanying consolidated financial statements
contained in ‘‘Item 8. Financial Statements and Supplementary Data’’ for a description of our long-term debt and other contractual obligations and commitments. Does
not include the $57 million CCHC accreting note which is included in note payable — related party. If not redeemed prior to maturity in 2020, $380 million would be due
under this note.
(2) Interest payments on variable debt are estimated using amounts outstanding at December 31, 2006 and the average implied forward London Interbank Offering Rate
(LIBOR) rates applicable for the quarter during the interest rate reset based on the yield curve in effect at December 31, 2006. Actual interest payments will differ based
on actual LIBOR rates and actual amounts outstanding for applicable periods.
(3) Represents amounts we will be required to pay under our interest rate hedge agreements estimated using the average implied forward LIBOR applicable rates for the
quarter during the interest rate reset based on the yield curve in effect at December 31, 2006.
(4) The Company leases certain facilities and equipment under noncancelable operating leases. Leases and rental costs charged to expense for the years ended December 31,
2006, 2005, and 2004, were $23 million, $22 million, and $22 million, respectively.
(5) We pay programming fees under multi-year contracts ranging from three to ten years, typically based on a flat fee per customer, which may be fixed for the term, or
may in some cases escalate over the term. Programming costs included in the accompanying statement of operations were approximately $1.5 billion, $1.4 billion, and
$1.3 billion, for the years ended December 31, 2006, 2005, and 2004, respectively. Certain of our programming agreements are based on a flat fee per month or have
guaranteed minimum payments. The table sets forth the aggregate guaranteed minimum commitments under our programming contracts.
(6) ‘‘Other’’ represents other guaranteed minimum commitments, which consist primarily of commitments to our billing services vendors.
The following items are not included in the contractual Operating credit facilities. The Charter Operating credit facilities,
obligations table because the obligations are not fixed and/or along with our indentures, contain certain restrictive covenants,
determinable due to various factors discussed below. However, some of which require us to maintain specified financial ratios,
we incur these costs as part of our operations: and meet financial tests, and to provide audited financial
statements with an unqualified opinion from our independent
(We rent utility poles used in our operations. Generally, pole auditors. As of December 31, 2006, we are in compliance with
rentals are cancelable on short notice, but we anticipate the covenants under our credit facilities, as well as under our
that such rentals will recur. Rent expense incurred for pole indentures, and we expect to remain in compliance with those
rental attachments for the years ended December 31, 2006, covenants for the next twelve months. As of December 31,
2005, and 2004, was $44 million, $44 million, and $42 mil- 2006, our potential availability under our credit facilities totaled
lion, respectively. approximately $1.3 billion, although the actual availability at that
(We pay franchise fees under multi-year franchise agree- time was only $1.1 billion because of limits imposed by
ments based on a percentage of revenues generated from covenant restrictions. Continued access to our credit facilities is
video service per year. We also pay other franchise related subject to our remaining in compliance with these covenants,
costs, such as public education grants, under multi-year including covenants tied to our operating performance. If any
agreements. Franchise fees and other franchise-related costs events of non-compliance occur, funding under the credit
included in the accompanying statement of operations were facilities may not be available and defaults on some or
$175 million, $165 million, and $159 million for the years potentially all of our debt obligations could occur. An event of
ended December 31, 2006, 2005, and 2004, respectively. default under any of our debt instruments could result in the
acceleration of our payment obligations under that debt and,
(We also have $147 million in letters of credit, primarily to under certain circumstances, in cross-defaults under our other
our various worker’s compensation, property and casualty, debt obligations, which could have a material adverse effect on
and general liability carriers, as collateral for reimbursement our consolidated financial condition and results of operations.
of claims. These letters of credit reduce the amount we
may borrow under our credit facilities. Limitations on Distributions
Charter’s ability to make interest payments on its convertible
Credit Facility Availability
senior notes, and, in 2009, to repay the outstanding principal of
Our ability to operate depends upon, among other things, our its convertible senior notes of $413 million, will depend on its
continued access to capital, including credit under the Charter
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