Time Warner Cable 2010 Annual Report Download - page 102

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further described in the TWC Indenture and the applicable TWC Debt Security, plus, in each case, accrued but unpaid
interest to the redemption date.
TWE Notes and Debentures
Notes and debentures issued by TWE as of December 31, 2010 and 2009 were as follows:
Issuance Maturity
Semi-annual
Interest
Payments
Principal
Amount
Interest
Rate
(in millions) (in millions)
2010
(a)
2009
(a)
Outstanding Balance as of
December 31,
Date of
20-year notes . . .... Apr1992 May 2012 May/Nov $ 250 10.150% $ 258 $ 259
20-year notes . . .... Oct1992 Oct 2012 Apr/Oct 350 8.875% 362 359
30-year debentures . . Mar 1993 Mar 2023 Mar/Sept 1,000 8.375% 1,033 1,035
40-year debentures . . July 1993 July 2033 Jan/July 1,000 8.375% 1,047 1,049
Total . . . ......... $ 2,600 $ 2,700 $ 2,702
(a)
Outstanding balance amounts as of December 31, 2010 and 2009, include an unamortized fair value adjustment of $91 million and $102 million,
respectively, which includes the fair value adjustment recognized as a result of the 2001 merger of America Online, Inc. (now known as AOL Inc.)
and Time Warner Inc. (now known as Historic TW) and, as of December 31, 2010, the outstanding balance amount includes the estimated fair
value of interest rate swap assets, net, of $9 million. The fair value adjustment is amortized over the term of the related debt instrument as a
reduction to interest expense.
During 1992 and 1993, TWE issued notes and debentures (the “TWE Debt Securities”) publicly in a number of
offerings. TWE’s obligations under the TWE Debt Securities are guaranteed by TWC and TW NY (the “TWE Debt
Guarantors”). TWE has no obligation to file reports with the SEC under the Exchange Act.
The TWE Debt Securities were issued pursuant to an indenture, dated as of April 30, 1992, as it has been and may be
amended from time to time (the “TWE Indenture”) by and among TWE, the TWE Debt Guarantors and The Bank of
New York Mellon, as trustee. The TWE Indenture contains customary covenants relating to restrictions on the ability of
TWE or any material subsidiary to create liens and on the ability of TWE and the TWE Debt Guarantors to consolidate,
merge or convey or transfer substantially all of their assets. The TWE Indenture also contains customary events of default.
The TWE Debt Securities are unsecured senior obligations of TWE and rank equally with its other unsecured and
unsubordinated obligations. Interest on each series of TWE Debt Securities is payable semi-annually in arrears. The
guarantees of the TWE Debt Securities are unsecured senior obligations of the TWE Debt Guarantors and rank equally in
right of payment with all other unsecured and unsubordinated obligations of the TWE Debt Guarantors. The TWE Debt
Securities are not redeemable before maturity.
Debt Issuance Costs
For the years ended December 31, 2010 and 2009, the Company capitalized debt issuance costs of $25 million and
$34 million, respectively, in connection with the Company’s 2010 and 2009 public debt issuances. For the year ended
December 31, 2008, the Company capitalized debt issuance costs of $97 million in connection with the 364-day senior
unsecured term loan facility entered into in 2008 in connection with the Separation (the “2008 Bridge Facility”) and the
Company’s 2008 public debt issuances. These capitalized costs are amortized over the term of the related debt instrument
and are included as a component of interest expense, net, in the consolidated statement of operations.
For the years ended December 31, 2009 and 2008, the Company recognized as expense Separation-related debt
issuance costs of $13 million and $45 million, respectively, which are included as a component of interest expense, net, in
the consolidated statement of operations. The Separation-related debt issuance costs recognized as expense in 2009
primarily related to upfront loan fees for the 2008 Bridge Facility, which were recognized as expense when the facility was
repaid and terminated following the Company’s public debt issuance in March 2009. The Separation-related debt issuance
costs recognized as expense in 2008 primarily related to the portion of the upfront loan fees for the 2008 Bridge Facility
90
TIME WARNER CABLE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)