Time Magazine 2009 Annual Report Download - page 63

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Additional Information
See Note 7 to the accompanying consolidated financial statements for additional information regarding the
Company’s outstanding debt and other financing arrangements, including certain information about maturities,
covenants, rating triggers and bank credit agreement leverage ratios relating to such debt and financing
arrangements.
Contractual and Other Obligations
Contractual Obligations
In addition to the previously discussed financing arrangements, the Company has obligations under certain
contractual arrangements to make future payments for goods and services. These contractual obligations secure the
future rights to various assets and services to be used in the normal course of operations. For example, the Company
is contractually committed to make certain minimum lease payments for the use of property under operating lease
agreements. In accordance with applicable accounting rules, the future rights and obligations pertaining to firm
commitments, such as operating lease obligations and certain purchase obligations under contracts, are not reflected
as assets or liabilities in the accompanying consolidated balance sheet.
The following table summarizes the Company’s aggregate contractual obligations at December 31, 2009, and
the estimated timing and effect that such obligations are expected to have on the Company’s liquidity and cash flows
in future periods (millions):
Contractual Obligations
(a)(b)(c)
Total 2010 2011-2012 2013-2014 Thereafter
Outstanding debt obligations (Note 7)...... $15,406 $ — $ 4,000 $1,300 $10,106
Interest ............................ 14,322 1,088 1,952 1,495 9,787
Capital lease obligations (Note 7) ......... 149 21 38 33 57
Operating lease obligations (Note 15) ...... 2,732 424 736 650 922
Purchase obligations .................. 11,378 3,657 3,723 2,472 1,526
Total contractual obligations and outstanding
debt ............................. $43,987 $5,190 $10,449 $5,950 $22,398
(a)
The table does not include the effects of certain put/call or other buy-out arrangements involving certain of the Company’s investees.
(b)
The table does not include the Company’s reserve for uncertain tax positions and related accrued interest and penalties, which at
December 31, 2009 totaled $2.2 billion, as the specific timing of any cash payments relating to this obligation cannot be projected with
reasonable certainty.
(c)
The references to Note 7 and Note 15 refer to the notes to the accompanying consolidated financial statements.
The following is a description of the Company’s material contractual obligations at December 31, 2009:
• Outstanding debt obligations — represents the principal amounts due on outstanding debt obligations as of
December 31, 2009. Amounts do not include any fair value adjustments, bond premiums, discounts, interest
payments or dividends.
• Interest — represents amounts based on the outstanding debt balances, respective interest rates and maturity
schedule of the respective instruments as of December 31, 2009. Interest ultimately paid on these
obligations may differ based on changes in interest rates for variable-rate debt, as well as any potential
future refinancings entered into by the Company. See Note 7 to the accompanying consolidated financial
statements for further details.
• Capital lease obligations — represents the minimum lease payments under noncancelable capital leases,
primarily for certain transponder leases at the Networks segment.
51
TIME WARNER INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)