Charter 2015 Annual Report Download - page 119

CHARTER COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2015, 2014 AND 2013
(dollars in millions, except share or per share data or where indicated)
F- 22
voting power for the management of Charter Operating on a fully diluted basis and the occurrence of a ratings event
including a downgrade in the corporate family rating during a ratings decline period.
CCO Safari III Credit Facilities — Restrictive Covenants
The CCO Safari III credit facilities are subject to the terms and conditions of a separate credit facility and escrow agreement until
Charter Operating re-assumes its obligations for the loan. The CCO Safari III credit facilities contain customary representations
and warranties and affirmative covenants with limited negative covenants prohibiting CCO Safari III from engaging in any material
activities other than performing its obligations under the credit facilities and the escrow agreement or otherwise issuing other
indebtedness pursuant to escrow arrangements similar to the CCO Safari III credit facilities and escrow agreement. As required
by the CCO Safari III credit facilities, CCO Safari III, Bank of America, N.A., and U.S. Bank, N.A., as escrow agent, entered into
an escrow agreement pursuant to which CCO Safari III is required to maintain an escrow account over which the administrative
agent has a perfected first priority security interest on behalf of the CCO Safari III credit facilities lenders. The events of default
under the CCO Safari III credit facilities include, among others:
• the failure to make payments when due or within the applicable grace period;
• any acceleration of the loans and termination of the commitments under the Charter Operating credit facilities; and
• the escrow agreement shall cease to be in full force and effect or the lien in the escrow account shall cease to be enforceable
with the same effect and priority.
Limitations on Distributions
Distributions by the Company’s subsidiaries to a parent company for payment of principal on parent company notes are restricted
under the indentures and credit facilities discussed above, unless there is no default under the applicable indenture and credit
facilities, and unless each applicable subsidiary’s leverage ratio test is met at the time of such distribution. As of December 31,
2015, there was no default under any of these indentures or credit facilities. Distributions by Charter Operating for payment of
principal on parent company notes are further restricted by the covenants in its credit facilities.
In addition to the limitation on distributions under the various indentures discussed above, distributions by the Company’s
subsidiaries may only be made if they have “surplus” as defined in the Delaware Limited Liability Company Act.
Liquidity and Future Principal Payments
The Company continues to have significant amounts of debt, and its business requires significant cash to fund principal and interest
payments on its debt, capital expenditures and ongoing operations. As set forth below, the Company has significant future principal
payments beginning in 2018 and beyond. The Company continues to monitor the capital markets, and it expects to undertake
refinancing transactions and utilize free cash flow and cash on hand to further extend or reduce the maturities of its principal
obligations. The timing and terms of any refinancing transactions will be subject to market conditions.
Based upon outstanding indebtedness as of December 31, 2015 and assuming the TWC Transaction closes in the second quarter
of 2016, the amortization of term loans, and the maturity dates for all senior and subordinated notes, total future principal payments
on the total borrowings under all debt agreements as of December 31, 2015, are as follows:
Year Amount
2016 $ 121
2017 140
2018 844
2019 665
2020 4,202
Thereafter 29,930
$ 35,902