Print Page  Close Window

SEC Filings

S-1/A
CHARTER COMMUNICATIONS, INC. /MO/ filed this Form S-1/A on 11/01/1999
Entire Document
 
<PAGE>   286
          CHARTER COMMUNICATIONS HOLDING COMPANY, LLC AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
8.  FAIR VALUE OF FINANCIAL INSTRUMENTS:
 
     A summary of debt and the related interest rate hedge agreements at
December 31, 1997, is as follows:
 

<TABLE>
<CAPTION>
                                                              CARRYING    NOTIONAL     FAIR
                                                               VALUE       AMOUNT      VALUE
                                                              --------    --------    -------
<S>                                                           <C>         <C>         <C>
Debt
CCP Credit Agreement........................................  $41,500     $    --     $41,500
Interest Rate Hedge Agreements
Caps........................................................       --      15,000          --
Collars.....................................................       --      20,000         (74)
</TABLE>

 
     As the long-term debt under the credit agreements bears interest at current
market rates, its carrying amount approximates market value at December 31,
1997.
 
     The notional amounts of interest rate hedge agreements do not represent
amounts exchanged by the parties and, thus, are not a measure of the Company's
exposure through its use of interest rate hedge agreements. The amounts
exchanged are determined by reference to the notional amount and the other terms
of the contracts.
 
     The fair value of interest rate hedge agreements generally reflects the
estimated amounts that the Company would receive or pay (excluding accrued
interest) to terminate the contracts on the reporting date, thereby taking into
account the current unrealized gains or losses of open contracts. Dealer
quotations are available for the Company's interest rate hedge agreements.
 
     Management believes that the sellers of the interest rate hedge agreements
will be able to meet their obligations under the agreements. The Company has
policies regarding the financial stability and credit standing of major
counterparties. Nonperformance by the counterparties is not anticipated nor
would it have a material adverse effect on the Company's financial position or
results of operations.
 
9.  INCOME TAXES:
 
     At December 31, 1997, the Company had net operating loss carryforwards of
$9,594, which if not used to reduce taxable income in future periods, expire in
the years 2010 through 2012. As of December 31, 1997, the Company's deferred
income tax assets were offset by valuation allowances and deferred income tax
liabilities resulting primarily from differences in accounting for depreciation
and amortization.
 
10.  RELATED-PARTY TRANSACTIONS:
 
     Charter provides management services to the Company including centralized
customer billing services, data processing and related support, benefits
administration and coordination of insurance coverage and self-insurance
programs for medical, dental and workers' compensation claims. Certain costs for
services are billed and charged directly to the Company's operating subsidiaries
and are included in operating costs. These billings are determined based on the
number of basic customers. Such costs totaled $437, $220 and $131, respectively
for the period from January 1, 1998, through December 23, 1998, and the years
ended December 31, 1997 and 1996. All other costs incurred by Charter on behalf
of the Company are expensed in the accompanying financial statements and are
included in corporate expense allocations -- related
 
                                      F-39