Virgin Media 2010 Annual Report Download - page 85

common stock, or a combination of both, at our election, to settle our obligations. We have classified this debt as
long-term debt in the consolidated balance sheet as of December 31, 2010 because we determined, in accordance
with the Contracts in Entity’s own Equity Topic of the FASB ASC, that we have the ability to settle the
obligations in equity in all circumstances, except in the case of a fundamental change (as defined in the indenture
governing the convertible senior notes). This condition must be fulfilled on 20 of the last 30 trading days of each
calendar quarter. If the condition is not met during that time period, the notes will not be convertible in the
following quarter.
Restrictions Under Our Existing Debt Agreements
The agreements governing our senior notes, senior secured notes and senior credit facility significantly and,
in some cases absolutely, restrict our ability and the ability of most of our subsidiaries to:
• incur or guarantee additional indebtedness;
• pay dividends at certain levels of leverage, or make other distributions, or redeem or repurchase equity
interests or subordinated obligations;
• make investments;
• sell assets, including the capital stock of subsidiaries;
• enter into sale and leaseback transactions or certain vendor financing arrangements;
• create liens;
• enter into agreements that restrict the restricted subsidiaries’ ability to pay dividends, transfer assets or
make intercompany loans;
• merge or consolidate or transfer all or substantially all of their assets; and
• enter into transactions with affiliates.
We are also subject to financial maintenance covenants under our senior credit facility. Failure to meet these
covenant levels would result in a default under our senior credit facility.
Off-Balance Sheet Arrangements
As part of our ongoing business we have not participated in transactions that generate relationships with
unconsolidated entities or financial partnerships, such as entities frequently referred to as special purpose entities,
or SPEs, which would have been established for the purpose of facilitating off-balance sheet arrangements or
other contractually narrow or limited purposes. As of December 31, 2010 we were not involved with any material
unconsolidated SPEs.
Contractual Obligations and Commercial Commitments
The following table includes aggregate information about our contractual obligations as of December 31,
2010, and the periods in which payments are due (in millions):
Payments Due by Period (Undiscounted)
Contractual Obligations Total
Less than
1 year 1-3 years 3-5 years
More than
5 years
Long Term Debt Obligations ..................... £ 5,939.7 £ 150.3 £ 375.3 £1,150.0 £4,264.1
Capital Lease Obligations ........................ 438.1 92.9 104.5 36.1 204.6
Operating Lease Obligations ..................... 275.5 70.2 84.4 48.9 72.0
Purchase Obligations ........................... 1,262.5 518.9 455.6 161.0 127.0
Interest Obligations ............................. 2,591.4 404.9 802.3 791.4 592.8
Total ........................................ £10,507.2 £1,237.2 £1,822.1 £2,187.4 £5,260.5
Early Termination Charges ....................... £ 26.8 £ 3.7 £ — £ —
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