1271834--3/29/2006--CCO_HOLDINGS

related topics

{debt, indebtedness, cash}

{cost, contract, operation}

{regulation, change, law}

{competitive, industry, competition}

{stock, price, operating}

{financial, litigation, operation}

{capital, credit, financial}

{system, service, information}

{loss, insurance, financial}

{product, market, service}

{personnel, key, retain}

{operation, natural, condition}

{control, financial, internal}

{cost, operation, labor}

Risks Related to Significant Indebtedness of Us and Our Parent Companies We may not generate (or, in general, we and our parent companies may not have available to the applicable obligor) sufficient cash flow or have access to additional external liquidity sources to fund our capital expenditures, ongoing operations and our and our parent companies debt obligations. We may not be able to access funds under our credit facilities or bridge loan if we fail to satisfy the covenant restrictions in the credit facilities, which could adversely affect our financial condition and our ability to conduct our business. Because of our holding company structure, our outstanding notes are structurally subordinated in right of payment to all liabilities of our subsidiaries. Restrictions in our subsidiaries debt instruments limit their ability to provide funds to us. Any failure by our direct and indirect parent companies to satisfy their substantial debt obligations could have a material adverse effect on us. The agreements and instruments governing our debt and the debt of our parent companies contain restrictions and limitations that could significantly affect our ability to operate our business, as well as significantly affect our and our parent companies liquidity. All of our and our parent companies outstanding debt is subject to change of control provisions. We and our parent companies may not have the ability to raise the funds necessary to fulfill our and our parent companies obligations under our and our parent companies indebtedness following a change of control, which would place us and our parent companies in default under the applicable debt instruments. Paul G. Allen and his affiliates are not obligated to purchase equity from, contribute to or loan funds to us or any of our parent companies. Risks Related to Our Business We operate in a very competitive business environment, which affects our ability to attract and retain customers and can adversely affect our business and operations. We have lost a significant number of video customers to direct broadcast satellite competition and further loss of video customers could have a material negative impact on our business. We have a history of net losses and expect to continue to experience net losses. Consequently, we may not have the ability to finance future operations. We may not have the ability to pass our increasing programming costs on to our customers, which would adversely affect our cash flow and operating margins. If our required capital expenditures exceed our projections, we may not have sufficient funding, which could adversely affect our growth, financial condition and results of operations. Our inability to respond to technological developments and meet customer demand for new products and services could limit our ability to compete effectively. Malicious and abusive Internet practices could impair our high-speed Internet services Risks Related to Mr. Allen s Controlling Position The failure by Mr. Allen to maintain a minimum voting and economic interest in us could trigger a change of control default under our subsidiary s credit facilities. Mr. Allen controls us and may have interests that conflict with your interests. We are not permitted to engage in any business activity other than the cable transmission of video, audio and data unless Mr. Allen authorizes us to pursue that particular business activity, which could adversely affect our ability to offer new products and services outside of the cable transmission business and to enter into new businesses, and could adversely affect our growth, financial condition and results of operations. The loss of Mr. Allen s services could adversely affect our ability to manage our business. Risks Related to Regulatory and Legislative Matters Our business is subject to extensive governmental legislation and regulation, which could adversely affect our business. Our cable systems are operated under franchises that are subject to non-renewal or termination. The failure to renew a franchise in one or more key markets could adversely affect our business. Our cable systems are operated under franchises that are non-exclusive. Accordingly, local franchising authorities can grant additional franchises and create competition in market areas where none existed previously, resulting in overbuilds, which could adversely affect results of operations. Local franchise authorities have the ability to impose additional regulatory constraints on our business, which could further increase our expenses. Further regulation of the cable industry could cause us to delay or cancel service or programming enhancements or impair our ability to raise rates to cover our increasing costs, resulting in increased losses. Actions by pole owners might subject us to significantly increased pole attachment costs. We may be required to provide access to our networks to other Internet service providers, which could significantly increase our competition and adversely affect our ability to provide new products and services. Changes in channel carriage regulations could impose significant additional costs on us. Offering voice communications service may subject us to additional regulatory burdens, causing us to incur additional costs.

Full 10-K form ▸

1271834--3/29/2006--CCO_HOLDINGS_LLC