- our continued growth will also increase our need for qualified personnel.
We may not be able to hire such additional qualified personnel.
We cannot assure you that we will successfully integrate any acquired
systems into our operations.
THE FAILURE TO OBTAIN NECESSARY REGULATORY APPROVALS, OR TO SATISFY OTHER
CLOSING CONDITIONS, COULD IMPEDE THE CONSUMMATION OF A PENDING ACQUISITION. THIS
WOULD PREVENT OR DELAY OUR STRATEGY TO EXPAND OUR BUSINESS AND INCREASE
Our pending acquisitions are subject to federal, state and local regulatory
approvals. We cannot assure you that we will be able to obtain any necessary
approvals. These pending acquisitions are also subject to a number of other
closing conditions. We cannot assure you as to when, or if, each such
acquisition will be consummated. Any delay, prohibition or modification could
adversely affect the terms of a pending acquisition or could require us to
abandon an otherwise attractive opportunity and possibly forfeit earnest money.
OUR PROGRAMMING COSTS ARE INCREASING. WE MAY NOT HAVE THE ABILITY TO PASS THESE
INCREASES ON TO OUR CUSTOMERS, WHICH WOULD ADVERSELY AFFECT OUR CASH FLOW AND
Programming has been and is expected to continue to be our largest single
expense item. In recent years, the cable industry has experienced a rapid
escalation in the cost of programming, particularly sports programming. This
escalation may continue and we may not be able to pass programming cost
increases on to our customers. In addition, as we upgrade the channel capacity
of our systems and add programming to our basic and expanded basic programming
tiers, and reposition premium services to the basic tier, we may face additional
market constraints on our ability to pass programming costs on to our customers.
Basic programming includes a variety of entertainment and local programming.
Expanded basic programming offers more services than basic programming. Premium
service provides unedited, commercial-free movies, sports and other special
event entertainment programming. The inability to pass programming cost
increases on to our customers will have an adverse impact on our cash flow and
WE MAY BE UNABLE TO NEGOTIATE CONSTRUCTION CONTRACTS ON FAVORABLE TERMS AND OUR
CONSTRUCTION COSTS MAY INCREASE SIGNIFICANTLY. THIS COULD ADVERSELY AFFECT OUR
GROWTH, FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The expansion and upgrade of our existing systems and the systems we plan
to acquire in our pending acquisitions will require us to hire contractors and
enter into a number of construction agreements. We may have difficulty hiring
experienced civil contractors, and the contractors we hire may encounter cost
overruns or delays in construction. Our construction costs may increase
significantly over the next few years as existing contracts expire and as demand
for cable construction services continues to grow. We cannot assure you that we
will be able to construct new systems or expand or upgrade existing or acquired
systems in a timely manner or at a reasonable cost. This may adversely affect
our growth, financial condition and results of operations.
OUR PRINCIPAL EQUITY HOLDER MAY HAVE INTERESTS ADVERSE TO YOUR INTERESTS.
Paul G. Allen beneficially owns approximately 97% of our outstanding equity
interests on a fully diluted basis. Accordingly, Mr. Allen has the ability to