CHARTER COMMUNICATIONS, INC. /MO/ Management report and analysis of the financial situation and operating results. (Form 10-K)

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Reference is made to "Part I. Item 1A. Risk Factors" and "Cautionary Statement
Regarding Forward-Looking Statements," which describe important factors that
could cause actual results to differ from expectations and non-historical
information contained herein. In addition, the following discussion should be
read in conjunction with the audited consolidated financial statements and
accompanying notes thereto of Charter included in "Part II. Item 8. Financial
Statements and Supplementary Data."

Overview

We are a leading broadband connectivity company and cable operator serving more
than 32 million customers in 41 states through our Spectrum brand. Over an
advanced high-capacity, two-way telecommunications network, we offer a full
range of state-of-the-art residential and business services including Spectrum
Internet, TV, Mobile and Voice. For small and medium-sized companies, Spectrum
Business delivers the same suite of broadband products and services coupled with
special features and applications to enhance productivity, while for larger
businesses and government entities, Spectrum Enterprise provides highly
customized, fiber-based solutions. Spectrum Reach delivers tailored advertising
and production for the modern media landscape. We also distribute award-winning
news coverage, sports and high-quality original programming to our customers
through Spectrum Networks and Spectrum Originals. See "Part I. Item 1. Business
- Products and Services" for further description of these services, including
customer statistics for different services.

The COVID-19 pandemic significantly impacted how our customers use our products
and services, how they interact with us, and how our employees provide services
to our customers. Customer activity levels remain below normal which contributed
to lower operating expense from reduced service transactions and lower bad debt
in 2021 along with lower growth in customer relationships. We cannot predict
when trends return to pre-COVID-19 levels as the economy returns to normal
activities.

Although the ultimate impact of the COVID-19 pandemic cannot be predicted, we
remain focused on driving customer relationship growth by deploying superior
products and services with attractive pricing. In October 2021, we announced and
implemented new Spectrum Mobile multi-line pricing designed to drive more mobile
line sales per customer, and in turn, drive more broadband sales and the
associated retention benefits. Further, we expect to continue to drive customer
relationship growth through sales of Internet connectivity services and
improving customer retention despite the expectation for continued losses of
video and wireline voice customers.

Our Spectrum Mobile service is offered to customers subscribing to our Internet
service and runs on Verizon's mobile network combined with Spectrum WiFi. We
continue to explore ways to drive even more mobile traffic to our network. We
intend to use CBRS PALs we purchased in 2020, along with unlicensed CBRS
spectrum, to build our own 5G mobile data-only network on our existing
infrastructure in targeted geographies where there is high outdoor cellular
traffic volume. This effort, in combination with our expanding WiFi network and
continued 5G enhancements within the Verizon MVNO partnership agreement, should
position our mobile product for continued customer experience and cost structure
improvements.

We believe Spectrum-branded mobile services will drive higher sales of our core
products, create longer customer lives and increase profitability and cash flow
over time. As a result of growth costs associated with our new mobile product
line, we cannot be certain that we will be able to grow revenues or maintain our
margins at recent historical rates. During the years ended December 31, 2021 and
2020, our mobile product line increased revenues by $2.2 billion and $1.4
billion, respectively, reduced Adjusted EBITDA by approximately $311 million and
$401 million, respectively, and reduced free cash flow by approximately $853
million and $1.1 billion, respectively. We expect mobile Adjusted EBITDA will
continue to be negative primarily as a result of growth-related sales and
marketing and other customer acquisition costs for mobile services, and

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depending on the pace of that growth. We also expect to continue to see negative
free cash flow from the timing of device-related cash flows when we sell devices
to customers pursuant to equipment installment plans and capital expenditures
related to retail store and CBRS build-out.

We achieved revenues, adjusted EBITDA and operating profit during the periods presented as follows (in millions; all percentages are calculated using whole numbers. Minor differences may exist due to rounding).

                                       Years ended December 31,
                                       2021                 2020              2021 vs. 2020 Growth
   Revenues                   $      51,682              $ 48,097                            7.5  %
   Adjusted EBITDA            $      20,630              $ 18,518                           11.4  %
   Income from operations     $      10,526              $  8,405                           25.2  %



Adjusted EBITDA is defined as net income attributable to Charter shareholders
plus net income attributable to noncontrolling interest, net interest expense,
income taxes, depreciation and amortization, stock compensation expense, other
income (expenses), net and other operating (income) expenses, net, such as
special charges and (gain) loss on sale or retirement of assets. See "-Use of
Adjusted EBITDA and Free Cash Flow" for further information on Adjusted EBITDA
and free cash flow.

Growth in total revenue was primarily due to growth in our residential Internet,
mobile and commercial customers and price adjustments. Adjusted EBITDA and
income from operations growth was impacted by growth in revenue and increases in
operating costs and expenses, primarily mobile, programming and regulatory,
connectivity and produced content costs.

Approximately 91% of our revenues for each of the years ended December 31, 2021
and 2020 are attributable to monthly subscription fees charged to customers for
our Internet, video, voice, mobile and commercial services as well as regional
sports and news channels. Generally, these customer subscriptions may be
discontinued by the customer at any time subject to a fee for certain commercial
customers. The remaining 9% of revenue is derived primarily from advertising
revenues, franchise and other regulatory fee revenues (which are collected by us
but then paid to local authorities), sales of mobile and video devices,
processing fees or reconnection fees charged to customers to commence or
reinstate service, installation, VOD and pay-per-view programming, and
commissions related to the sale of merchandise by home shopping services.

Significant Accounting Policies and Estimates

Certain of our accounting policies require our management to make difficult,
subjective and/or complex judgments. Management has discussed these policies
with the Audit Committee of Charter's board of directors, and the Audit
Committee has reviewed the following disclosure. We consider the following
policies to be the most critical in understanding the estimates, assumptions and
judgments that are involved in preparing our financial statements, and the
uncertainties that could affect our results of operations, financial condition
and cash flows:

•Capitalization of labor and overhead costs
•Valuation and impairment of franchises and goodwill
•Income taxes
•Defined benefit pension plans

Capitalization of personnel costs and overheads

Costs associated with network construction or upgrades, placement of the
customer drop to the dwelling and the placement of outlets within a dwelling
along with the costs associated with the deployment of new customer premise
equipment necessary to provide Internet, video or voice services, are
capitalized.  Costs capitalized include materials, direct labor and certain
indirect costs.  These indirect costs consist of compensation and overhead costs
associated with support functions.  While our capitalization is based on
specific activities, once capitalized, we track these costs on a composite basis
by fixed asset category at the cable system level, and not on a specific asset
basis.  For assets that are sold or retired, we remove the estimated applicable
cost and accumulated depreciation.  The costs of disconnecting service and
removing customer premise equipment from a dwelling and the costs to reconnect a
customer drop or to redeploy previously installed customer premise equipment are
charged to operating expense as incurred. Costs for repairs and maintenance are
charged to operating expense as incurred,

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while the replacement of plant and equipment, including the replacement of certain components, improvements and the replacement of cable drops and sockets, are capitalized.

We make judgments regarding the installation and construction activities to be
capitalized. We capitalized direct labor and overhead of $1.7 billion and $1.6
billion for the years ended December 31, 2021 and 2020, respectively. We
capitalize direct labor and overhead using standards developed from actual costs
and applicable operational data. We calculate standards annually (or more
frequently if circumstances dictate) for items such as the labor rates, overhead
rates, and the actual amount of time required to perform a capitalizable
activity. For example, the standard amounts of time required to perform
capitalizable activities are based on studies of the time required to perform
such activities. Overhead rates are established based on an analysis of the
nature of costs incurred in support of capitalizable activities, and a
determination of the portion of costs that is directly attributable to
capitalizable activities. The impact of changes that resulted from these studies
were not material in the periods presented.

Labor costs directly associated with capital projects are capitalized. Capitalizable activities carried out in connection with the facilities include activities such as:

•dispatching a "truck roll" to the customer's dwelling or business for service
connection or placement of new equipment;
•costs to package and ship new equipment to a customer's home for
self-installation;
•verification of serviceability to the customer's dwelling or business (i.e.,
determining whether the customer's dwelling is capable of receiving service by
our cable network);
•customer premise activities performed by in-house field technicians and
third-party contractors in connection with the installation, replacement and
betterment of equipment and materials to enable Internet, video or voice
services; and
•verifying the integrity of the customer's network connection by initiating test
signals downstream from the headend to the customer premise equipment, as well
as testing signal levels at the utility pole or pedestal.

Judgment is required to determine the extent to which overhead costs incurred
result from specific capital activities, and therefore should be capitalized.
The primary costs that are included in the determination of the overhead rate
are (i) employee benefits and payroll taxes associated with capitalized direct
labor, (ii) direct variable costs associated with capitalizable activities,
(iii) the cost of support personnel, such as care personnel and dispatchers, who
assist with capitalizable installation activities, and (iv) indirect costs
directly attributable to capitalizable activities.

While we believe our existing capitalization policies are appropriate, a
significant change in the nature or extent of our operating practices could
affect management's judgment about the extent to which we should capitalize
direct labor or overhead in the future. We monitor the appropriateness of our
capitalization policies, and perform updates to our internal studies on an
ongoing basis to determine whether facts or circumstances warrant a change to
our capitalization policies.

Valuation and depreciation of franchises

The net carrying value of franchises as of both December 31, 2021 and 2020 was
approximately $67.3 billion (representing 47% of total assets). Franchise assets
are aggregated into essentially inseparable units of accounting to conduct
valuations. The units of accounting generally represent geographical clustering
of our cable systems into groups. For more information and a complete discussion
of how we value and test franchise assets for impairment, see Note 5 to the
accompanying consolidated financial statements contained in "Part II. Item 8.
Financial Statements and Supplementary Data."

We perform an impairment assessment of franchise assets annually or more
frequently as warranted by events or changes in circumstances. We performed a
qualitative assessment in 2021. Our assessment included consideration of a
multitude of factors that affect the fair value of our franchise assets.
Examples of such factors include environmental and competitive changes within
our operating footprint, actual and projected operating performance, the
consistency of our operating margins, equity and debt market trends, including
changes in our market capitalization, and changes in our regulatory and
political landscape, among other factors. Based on our assessment, we concluded
that it was more likely than not that the estimated fair values of our franchise
assets equals or exceeds their carrying values and that a quantitative
impairment test is not required.

Valuation and impairment of goodwill

The net carrying value of goodwill as of both December 31, 2021 and 2020 was
approximately $29.6 billion (representing 21% and 20% of total assets,
respectively). We have determined that we have one reporting unit for purposes
of the assessment of goodwill impairment. For more information and a complete
discussion on how we test goodwill for impairment, see Note 5 to the
accompanying consolidated financial statements contained in "Part II. Item 8.
Financial Statements and Supplementary

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Data." We perform our impairment assessment of goodwill annually as of November
30. As with our franchise impairment testing, we elected to perform a
qualitative assessment of goodwill in 2021. Given the completion of the
assessment and absence of significant adverse changes in factors impacting our
fair value estimates, we concluded that it is more likely than not that our
goodwill is not impaired.

Income taxes

As of December 31, 2021, Charter had approximately $714 million of federal tax
net operating loss carryforwards resulting in a gross deferred tax asset of
approximately $150 million. These losses resulted from the operations of Charter
Communications Holding Company, LLC ("Charter Holdco") and its subsidiaries and
from loss carryforwards received as a result of the merger with TWC. Federal tax
net operating loss carryforwards expire in the years 2034 through 2035. In
addition, as of December 31, 2021, Charter had state tax net operating loss
carryforwards, resulting in a gross deferred tax asset (net of federal tax
benefit) of approximately $175 million. State tax net operating loss
carryforwards generally expire in the years 2022 through 2041. Such tax loss
carryforwards can accumulate and be used to offset Charter's future taxable
income. After December 31, 2021, $714 million of Charter's federal tax loss
carryforwards are subject to Section 382 and other restrictions. Pursuant to
these restrictions, Charter estimates that approximately $229 million annually
over each of the next three years of federal tax loss carryforwards, should
become unrestricted and available for Charter's use. Charter's state tax loss
carryforwards are subject to similar but varying restrictions.

In assessing the realizability of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the deferred tax
assets will be realized. In evaluating the need for a valuation allowance,
management takes into account various factors, including the expected level of
future taxable income, available tax planning strategies and reversals of
existing taxable temporary differences. Approximately $13 million of valuation
allowance associated with federal capital loss carryforwards and approximately
$23 million of valuation allowance associated with state tax loss carryforwards
and other miscellaneous deferred tax assets remains on the December 31, 2021
consolidated balance sheet.

In determining our tax provision for financial reporting purposes, we establish
a reserve for uncertain tax positions unless such positions are determined to be
"more likely than not" of being sustained upon examination, based on their
technical merits. In evaluating whether a tax position has met the
more-likely-than-not recognition threshold, we presume the position will be
examined by the appropriate taxing authority that has full knowledge of all
relevant information. A tax position that meets the more-likely-than-not
recognition threshold is measured to determine the amount of benefit to be
recognized in our financial statements. The tax position is measured as the
largest amount of benefit that has a greater than 50% likelihood of being
realized when the position is ultimately resolved. There is considerable
judgment involved in determining whether positions taken on the tax return are
"more likely than not" of being sustained. We adjust our uncertain tax reserve
estimates periodically because of ongoing examinations by, and settlements with,
the various taxing authorities, as well as changes in tax laws, regulations and
interpretations.

Charter is currently under examination by the Internal Revenue Service ("IRS")
for income tax purposes for 2019. Charter's 2016, 2018 and 2020 tax years remain
open for examination and assessment. Charter's 2017 tax year remains open solely
for purposes of loss and credit carryforwards. Charter's short period return
dated May 17, 2016 (prior to the merger with TWC and acquisition of Bright
House) and prior years remain open solely for purposes of examination of
Charter's loss and credit carryforwards. The IRS is currently examining Charter
Holdings' income tax return for 2016 and 2019. Charter Holdings' 2018 and 2020
tax years remain open for examination and assessment, while 2017 remains open
solely for purposes of credit carryforwards. The IRS is currently examining
TWC's income tax returns for 2011 through 2014. TWC's tax year 2015 remains
subject to examination and assessment. Prior to TWC's separation from Time
Warner Inc. ("Time Warner") in March 2009, TWC was included in the consolidated
U.S. federal and certain state income tax returns of Time Warner. The IRS has
examined Time Warner's 2008 through 2010 income tax returns and the results are
under appeal. We do not anticipate that these examinations will have a material
impact on our consolidated financial position or results of operations. In
addition, we are also subject to ongoing examinations of our tax returns by
state and local tax authorities for various periods. Activity related to these
state and local examinations did not have a material impact on our consolidated
financial position or results of operations during the year ended December 31,
2021, nor do we anticipate a material impact in the future.

Defined benefit pension plans

We sponsor qualified and unqualified defined benefit pension plans that provide
pension benefits to a majority of employees who were employed by TWC before the
merger with TWC. As of December 31, 2021, the accumulated benefit obligation and
fair value of plan assets was $3.4 billion and $3.5 billion, respectively, and
the net funded asset was recorded as a $114 million noncurrent asset, $4 million
current liability and $27 million long-term liability. As of December 31, 2020,
the accumulated

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the benefit obligation and the fair value of plan assets have been $3.7 billion and $3.5 billion, respectively, and the net underfunded liability was accounted for as a $1 million non-current asset, $5 million current responsibility and $222 million
long-term responsibility.

Pension benefits are based on formulas that reflect the employees' years of
service and compensation during their employment period. Actuarial gains or
losses are changes in the amount of either the benefit obligation or the fair
value of plan assets resulting from experience different from that assumed or
from changes in assumptions. We have elected to follow a mark-to-market pension
accounting policy for recording the actuarial gains or losses annually during
the fourth quarter, or earlier if a remeasurement event occurs during an interim
period. We use a December 31 measurement date for our pension plans.

We recognized net periodic pension benefit of $305 million and net periodic
pension cost of $66 million in 2021 and 2020, respectively. Net periodic pension
benefit or expense is determined using certain assumptions, including the
expected long-term rate of return on plan assets, discount rate and mortality
assumptions. We determined the discount rate used to compute pension expense
based on the yield of a large population of high-quality corporate bonds with
cash flows sufficient in timing and amount to settle projected future defined
benefit payments. In developing the expected long-term rate of return on assets,
we considered the current pension portfolio's composition, past average rate of
earnings, and our asset allocation targets. We used a discount rate of 3.01% to
determine the December 31, 2021 pension plan benefit obligation. A decrease in
the discount rate of 25 basis points would result in a $155 million increase in
our pension plan benefit obligation as of December 31, 2021 and net periodic
pension expense recognized in 2021 under our mark-to-market accounting policy.
The expected long-term rate of return on plan assets used to determine net
periodic pension benefit for the year ended December 31, 2022 is expected to be
5.00%. A decrease in the expected long-term rate of return of 25 basis points to
4.75%, while holding all other assumptions constant, would result in an increase
in our 2022 net periodic pension expense of approximately $8 million. See Note
23 to the accompanying consolidated financial statements contained in "Part II.
Item 8. Financial Statements and Supplementary Data" for additional discussion
on these assumptions.


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Operating results

A discussion of changes in our results of operations during the year ended
December 31, 2020 compared to the year ended December 31, 2019 has been omitted
from this Annual Report on Form 10-K, but may be found in "Item 7. Management's
Discussion and Analysis of Financial Condition and Results of Operations" in our
Annual Report on Form 10-K for the year ended December 31, 2020, filed with the
SEC on January 29, 2021, which is available free of charge on the SECs website
at www.sec.gov and on our investor relations website at ir.charter.com.

The following table presents the Consolidated Statements of Income for the periods presented (in millions of dollars, except per share data):

                                                                          Year Ended December 31,
                                                                        2021                   2020
Revenues                                                          $      51,682          $      48,097

Costs and Expenses: Operating costs and expenses (excluding items listed separately below)

                                                                   31,482                 29,930
Depreciation and amortization                                             9,345                  9,704
Other operating expenses, net                                               329                     58
                                                                         41,156                 39,692
Income from operations                                                   10,526                  8,405

Other Income (Expenses):
Interest expense, net                                                    (4,037)                (3,848)
Other expenses, net                                                        (101)                  (255)
                                                                         (4,138)                (4,103)

Income before income taxes                                                6,388                  4,302
Income tax expense                                                       (1,068)                  (626)
Consolidated net income                                                   5,320                  3,676
Less: Net income attributable to noncontrolling interests                  (666)                  (454)
Net income attributable to Charter shareholders                   $       

4,654 $3,222

EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CHARTER SHAREHOLDERS:
Basic                                                             $       25.34          $       15.85
Diluted                                                           $       24.47          $       15.40

Weighted average common shares outstanding, basic                   183,669,369            203,316,483
Weighted average common shares outstanding, diluted                 193,042,948            209,273,247



Revenues. Total revenue increased $3.6 billion or 7.5% during the year ended
December 31, 2021 compared to 2020 mainly due to the increase in the number of residential, mobile and commercial Internet customers and price adjustments.

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Revenues by service offering were as follows (dollars in millions; all
percentages are calculated using whole numbers. Minor differences may exist due
to rounding):

                                              Years ended December 31,
                                              2021                 2020              % Growth
         Internet                    $      21,094              $ 18,521               13.9  %
         Video                              17,630                17,432                1.1  %
         Voice                               1,598                 1,806              (11.5) %
         Residential revenue                40,322                37,759                6.8  %

         Small and medium business           4,170                 3,964                5.2  %
         Enterprise                          2,573                 2,468                4.3  %
         Commercial revenue                  6,743                 6,432                4.9  %

         Advertising sales                   1,594                 1,699               (6.2) %
         Mobile                              2,178                 1,364               59.6  %
         Other                                 845                     843              0.2  %
                                     $      51,682              $ 48,097                7.5  %

The increase in Internet revenues from our residential customers is attributable to the following factors (in millions of dollars):

2021 vs.

2020

Increase due to changes in pricing, product mix and bundle allocation

  $       1,490
Increase in average residential Internet customers                                   1,083
                                                                             $       2,573


The increase related to changes in pricing, product mix and plan attribution is mainly due to price adjustments, cancellation of promotions and increase in bundled revenue attribution as well as at $34 million credits related to the prior year’s Keep Americans Connected (“KAC”) commitment and certain state-mandated programs that reduced revenue in the year ended December 31, 2020. The number of residential Internet customers increased by 1,114,000 in 2021 compared to 2020.

Video revenues consist primarily of revenues from basic and digital video services provided to our residential customers, as well as franchise royalties, equipment service fees and video installation revenues. The increase in video revenue is attributable to the following (in millions of dollars):

2021 vs.

2020

Customer credits due to COVID-19                                              $           223

Increase due to changes in pricing, product mix and bundle allocation

               283
Decrease in average residential video customers                                          (250)
Decrease in video on demand and pay-per-view                                              (44)
Decrease in installation                                                                  (14)
                                                                              $           198



We recorded $39 million and $218 million of estimated customer credits related
to canceled sporting events during the years ended December 31, 2021 and 2020,
respectively, and $44 million of credits related to prior year's KAC program
which reduced revenue during the year ended December 31, 2020. The increase
related to rate, product mix and bundle allocation changes was primarily due to
price adjustments and promotional roll-off and was partly offset by a higher mix
of lower cost video packages within our video customer base and lower bundled
revenue allocation. Residential video customers decreased by 423,000 in 2021
compared to 2020.

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The decrease in voice revenues from our residential customers is attributable to the following items (in millions of dollars):

                                                            2021 compared 

to 2020

  Decrease related to rate and bundle allocation changes   $                

(132)

  Decrease in average residential voice customers                             (76)
                                                           $                 (208)


The decrease related to pricing and package allocation changes was impacted by value-based pricing and changes in bundled revenue allocations. The number of residential wireline telephone service customers decreased by 594,000 in 2021 compared to 2020.

The increase in SMB commercial revenues was attributable to the following
(dollars in millions):

                                                                            2021 compared to
                                                                                  2020
Increase in SMB customers                                                  $           209

Increase related to COVID-19 programs that reduced prior year revenue

             36
Decrease related to rate and product mix changes                                       (39)
                                                                           $           206



SMB customers increased by 92,000 in 2021 compared to 2020. The decrease related
to rate and product mix changes during the year ended December 31, 2021 as
compared to 2020 was primarily due to value-based pricing related to SPP net of
promotional roll-off and price adjustments.

Enterprise revenues increased $105 million during the year ended December 31,
2021 as compared to the corresponding period in 2020 primarily due to an
increase in Internet PSUs, $18 million of impacts from COVID-19 related programs
which reduced revenues in the year ended December 31, 2020 as well as a $16
million one-time benefit incurred during the year ended December 31, 2021 offset
by lower wholesale PSUs. Enterprise PSUs increased by 13,000 in 2021 compared to
2020.

Advertising sales revenues consist primarily of revenues from commercial
advertising customers, programmers and other vendors, as well as local cable and
advertising on regional sports and news channels. Advertising sales revenues
decreased $105 million during the year ended December 31, 2021 as compared to
the corresponding period in 2020 primarily due to a decrease in political offset
by an increase in advanced advertising revenues and local and national
advertising revenues as well as the impacts of COVID-19 that lowered revenues in
2020.

During the years ended December 31, 2021 and 2020, mobile revenues included
approximately $909 million and $658 million of device revenues, respectively,
and approximately $1.3 billion and $706 million of service revenues,
respectively. The increases in revenues are a result of an increase of 1,189,000
lines from December 31, 2020 to December 31, 2021.

Other revenues consist of revenue from regional sports and news channels
(excluding intercompany charges or advertising sales on those channels), home
shopping, late payment fees, video device sales, wire maintenance fees and other
miscellaneous revenues. Other revenues remained relatively consistent during the
year ended December 31, 2021 as compared to the corresponding period in 2020.

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Operating costs and expenses. The increase in our operating costs and expenses, excluding items presented separately in the consolidated statements of earnings, is attributable to the following factors (in millions of dollars):

                                                        2021 compared to 2020
       Programming                                     $                 443
       Regulatory, connectivity and produced content                     311
       Costs to service customers                                        (79)
       Marketing                                                          40
       Mobile                                                            724
       Other                                                             113
                                                       $               1,552



Programming costs were approximately $11.8 billion and $11.4 billion for the
years ended December 31, 2021 and 2020, respectively, representing 38% of
operating costs and expenses. Programming costs consist primarily of costs paid
to programmers for basic, digital, premium, video on demand, and pay-per-view
programming. Programming costs increased as a result of $124 million of more
rebates in 2020 than 2021 from sports programming networks as a result of
canceled sporting events due to COVID-19, as well as contractual rate
adjustments, including renewals and increases in amounts paid for retransmission
consent offset by fewer customers and a higher mix of lower cost video packages
within our video customer base. We expect programming rates per customer will
continue to increase due to a variety of factors, including annual increases
imposed by programmers with additional selling power as a result of media and
broadcast station groups consolidation, increased demands by owners of broadcast
stations for payment for retransmission consent or linking carriage of other
services to retransmission consent, and additional programming. We have been
unable to fully pass these increases on to our customers and do not expect to be
able to do so in the future without a potential loss of customers.

Regulatory, connectivity and produced content increased $311 million during the
year ended December 31, 2021 compared to the corresponding period in 2020
primarily due to higher sports rights costs as a result of more National
Basketball Association ("NBA") and Major League Baseball ("MLB") games during
2021 as compared to the corresponding period in 2020 as the prior period had
cancelation of MLB games and the current period had additional games due to the
delayed start of the 2020 - 2021 NBA season as a result of COVID-19.

Costs to service customers decreased $79 million during the year ended
December 31, 2021 compared to the corresponding period in 2020 despite 3.0%
customer growth primarily due to fewer transactions and a decrease in bad debt
expense partly driven by government stimulus packages offset by the higher labor
costs associated with our commitment to a minimum $20 per hour wage in 2022.

Mobile costs of $2.5 billion and $1.8 billion for the years ended December 31,
2021 and 2020, respectively, were comprised of mobile device costs and mobile
service, customer acquisition and operating costs. The increase is attributable
to an increase in the number of mobile lines.

The increase in other expense was attributable to the following (dollars in
millions):

                                              2021 compared to 2020
               Stock compensation expense    $                   79
               Enterprise                                        21
               Corporate costs                                   20
               Property tax and insurance                        17
               Advertising sales expense                        (21)
               Other                                             (3)
                                             $                  113




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Equity compensation expense increased primarily due to changes to certain equity award provisions that result in additional expense at the time of award.

Depreciation and amortization. Depreciation and amortization expense decreased
by $359 million during the year ended December 31, 2021 compared to the
corresponding period in 2020 primarily due to certain assets acquired in
acquisitions becoming fully depreciated offset by an increase in depreciation as
a result of more recent capital expenditures.

Other operating expenses, net. The net increase in other operating expenses is attributable to the following items (in millions of dollars):

                                                   2021 compared to 2020
           Special charges, net                   $                  159
           (Gain) loss on sale of assets, net                        112
                                                  $                  271



For more information, see Note 15 to the accompanying consolidated financial
statements contained in "Part II. Item 8. Financial Statements and Supplementary
Data."

Interest expense, net. Net interest expense increased by $189 million in 2021
from 2020 primarily due to an increase in weighted average debt outstanding of
approximately $7.1 billion primarily as a result of the issuance of notes in
2020 and 2021 for general corporate purposes including stock buybacks and debt
repayments offset by a decrease in weighted average interest rates.

Other charges, net. The decrease in other expenses, net, is attributable to the following items (in millions of dollars):

                                                         2021 compared to 

2020

    Loss on extinguishment of debt (see Note 9)         $                  

(1)

    Loss on financial instruments, net (see Note 12)                       

(71)

    Net periodic pension benefit (cost) (see Note 23)                      

371

    Loss on equity investments, net (see Note 6)                          (145)
                                                        $                  154


See Note 16 and the Notes referred to above to the accompanying consolidated financial statements contained in “Item 1. Financial Statements” for more information.

Income tax expense. We recognized income tax expense of $1.1 billion and $626
million for the years ended December 31, 2021 and 2020, respectively. Income tax
expense increased during the year ended December 31, 2021 compared to the
corresponding period in 2020 primarily as a result of higher pretax income. For
more information, see Note 18 to the accompanying consolidated financial
statements contained in "Part II. Item 8. Financial Statements and Supplementary
Data."

Net income attributable to noncontrolling interest. Net income attributable to
noncontrolling interest for financial reporting purposes represents A/N's
portion of Charter Holdings' net income based on its effective common unit
ownership interest and the preferred dividend of $70 million and $150 million
for the years ended December 31, 2021 and 2020, respectively. For more
information, see Note 11 to the accompanying consolidated financial statements
contained in "Part II. Item 8. Financial Statements and Supplementary Data."

Net profit attributable to founding shareholders. Net profit attributable to Charter shareholders was $4.7 billion and $3.2 billion for the years ended
December 31, 2021 and 2020, respectively, primarily due to the factors described above.

Use of Adjusted EBITDA and Free Cash Flow

We use certain measures that are not defined by U.S. generally accepted
accounting principles ("GAAP") to evaluate various aspects of our business.
Adjusted EBITDA and free cash flow are non-GAAP financial measures and should be
considered in addition to, not as a substitute for, net income attributable to
Charter shareholders and net cash flows from operating activities

                                       37
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reported in accordance with GAAP. These terms, as we define them, may not be comparable to similarly named measures used by other companies. Adjusted EBITDA and free cash flow are reconciled to net income attributable to chartered shareholders and net cash flow from operating activities, respectively, below.

Adjusted EBITDA eliminates the significant non-cash depreciation and
amortization expense that results from the capital-intensive nature of our
businesses as well as other non-cash or special items, and is unaffected by our
capital structure or investment activities. However, this measure is limited in
that it does not reflect the periodic costs of certain capitalized tangible and
intangible assets used in generating revenues and our cash cost of financing.
These costs are evaluated through other financial measures.

Free cash flow is defined as net cash flow from operating activities less capital expenditures and changes in accrued liabilities related to capital expenditures.

Management and Charter's board of directors use Adjusted EBITDA and free cash
flow to assess our performance and our ability to service our debt, fund
operations and make additional investments with internally generated funds. In
addition, Adjusted EBITDA generally correlates to the leverage ratio calculation
under our credit facilities or outstanding notes to determine compliance with
the covenants contained in the facilities and notes (all such documents have
been previously filed with the SEC). For the purpose of calculating compliance
with leverage covenants, we use Adjusted EBITDA, as presented, excluding certain
expenses paid by our operating subsidiaries to other Charter entities. Our debt
covenants refer to these expenses as management fees, which fees were in the
amount of $1.3 billion for each of the years ended December 31, 2021 and 2020.

A reconciliation of Adjusted EBITDA and Free Cash Flow to Net Income Attributable to Chartered Shareholders and Net Cash Flow from Operating Activities, respectively, is as follows (in millions of dollars).

                                                                      Years 

ended the 31st of December,

                                                                      2021                  2020
Net income attributable to Charter shareholders                 $       4,654          $     3,222
Plus: Net income attributable to noncontrolling interest                  666                  454
Interest expense, net                                                   4,037                3,848
Income tax expense                                                      1,068                  626
Depreciation and amortization                                           9,345                9,704
Stock compensation expense                                                430                  351
Other expenses, net                                                       430                  313
Adjusted EBITDA                                                 $      20,630          $    18,518

Net cash flows from operating activities                        $      16,239          $    14,562
Less: Purchases of property, plant and equipment                       (7,635)              (7,415)
Change in accrued expenses related to capital expenditures                 80                  (77)
Free cash flow                                                  $       8,684          $     7,070


Cash and capital resources

Overview

We have significant amounts of debt.  The principal amount of our debt as of
December 31, 2021 was $91.2 billion, consisting of $10.7 billion of credit
facility debt, $56.5 billion of investment grade senior secured notes and $24.0
billion of high-yield senior unsecured notes. Our business requires significant
cash to fund principal and interest payments on our debt.

Our projected cash needs and projected sources of liquidity depend upon, among
other things, our actual results, and the timing and amount of our expenditures.
As we continue to grow our mobile services, we expect an initial funding period
to grow a new product as well as negative working capital impacts from the
timing of device-related cash flows when we sell devices to customers pursuant
to equipment installment plans. Further, in 2022, Charter expects to become a
meaningful federal cash tax payer as the majority of net operating losses will
have been utilized. Free cash flow was $8.7 billion and $7.1 billion for the
years ended December 31, 2021 and 2020, respectively. See table below for
factors impacting free cash flow during the year ended December 31, 2021
compared to 2020. As of December 31, 2021, the amount available under our credit
facilities was

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approximately $3.9 billion and cash on hand was approximately $601 million. We
expect to utilize free cash flow, cash on hand and availability under our credit
facilities as well as future refinancing transactions to further extend the
maturities of our obligations. The timing and terms of any refinancing
transactions will be subject to market conditions among other considerations.
Additionally, we may, from time to time, and depending on market conditions and
other factors, use cash on hand and the proceeds from securities offerings or
other borrowings to retire our debt through open market purchases, privately
negotiated purchases, tender offers or redemption provisions. We believe we have
sufficient liquidity from cash on hand, free cash flow and Charter Operating's
revolving credit facility as well as access to the capital markets to fund our
projected cash needs.

We continue to evaluate the deployment of our cash on hand and anticipated
future free cash flow including to invest in our business growth and other
strategic opportunities, including expanding the capacity of our network, the
expansion of our network through our rural broadband construction project, the
build-out and deployment of our CBRS spectrum, and mergers and acquisitions as
well as stock repurchases and dividends. Charter's target leverage of net debt
to the last twelve months Adjusted EBITDA remains at 4 to 4.5 times Adjusted
EBITDA, and up to 3.5 times Adjusted EBITDA at the consolidated first lien
level. Our leverage ratio was 4.4 times Adjusted EBITDA as of December 31, 2021.
As Adjusted EBITDA grows, we expect to increase the total amount of our
indebtedness to maintain leverage within Charter's target leverage range.
Excluding purchases from Liberty Broadband discussed below, during the years
ended December 31, 2021 and 2020, Charter purchased in the public market
approximately 15.9 million and 18.4 million shares, respectively, of Charter
Class A common stock for approximately $10.9 billion and $10.6 billion,
respectively. Since the beginning of its buyback program in September 2016
through the year ended December 31, 2021, Charter has purchased in the public
market approximately 125.6 million shares of Class A common stock and Charter
Holdings common units for approximately $56.8 billion, including purchases from
Liberty Broadband discussed below.

In February 2021, Charter and Liberty Broadband entered into a letter agreement
(the "LBB Letter Agreement"). The LBB Letter Agreement implements Liberty
Broadband's obligations under the Stockholders Agreement to participate in share
repurchases by Charter. Under the LBB Letter Agreement, Liberty Broadband will
sell to Charter, generally on a monthly basis, a number of shares of Charter
Class A common stock representing an amount sufficient for Liberty Broadband's
ownership of Charter to be reduced such that it does not exceed the ownership
cap then applicable to Liberty Broadband under the Stockholders Agreement at a
purchase price per share equal to the volume weighted average price per share
paid by Charter for shares repurchased during such immediately preceding
calendar month other than (i) purchases from A/N, (ii) purchases in privately
negotiated transactions or (iii) purchases for the withholding of shares of
Charter Class A common stock pursuant to equity compensation programs of
Charter. Charter purchased from Liberty Broadband 6.1 million shares of Charter
Class A common stock for approximately $4.2 billion during the year ended
December 31, 2021. In January 2022, Charter purchased from Liberty Broadband an
additional 0.5 million shares of Charter Class A common stock for approximately
$341 million.

In December 2016, Charter and A/N entered into a letter agreement, as amended in
December 2017 (the "A/N Letter Agreement"), that requires A/N to sell to Charter
or to Charter Holdings, on a monthly basis, a number of shares of Charter
Class A common stock or Charter Holdings common units that represents a pro rata
participation by A/N and its affiliates in any repurchases of shares of Charter
Class A common stock from persons other than A/N effected by Charter during the
immediately preceding calendar month, at a purchase price equal to the average
price paid by Charter for the shares repurchased from persons other than A/N
during such immediately preceding calendar month. A/N and Charter both have the
right to terminate or suspend the pro rata repurchase arrangement on a
prospective basis. During the years ended December 31, 2021 and 2020, Charter
Holdings purchased from A/N 3.3 million and 2.6 million Charter Holdings common
units, respectively, for approximately $2.2 billion and $1.5 billion,
respectively.

As of December 31, 2021, Charter had remaining board authority to purchase an
additional $1.9 billion of Charter's Class A common stock and/or Charter
Holdings common units, excluding purchases from Liberty Broadband. Although
Charter expects to continue to buy back its common stock consistent with its
leverage target range, Charter is not obligated to acquire any particular amount
of common stock, and the timing of any purchases that may occur cannot be
predicted and will largely depend on market conditions and other potential uses
of capital. Purchases may include open market purchases, tender offers or
negotiated transactions.

As possible acquisitions, swaps or dispositions arise, we actively review them
against our objectives including, among other considerations, improving the
operational efficiency, geographic clustering of assets, product development or
technology capabilities of our business and achieving appropriate return
targets, and we may participate to the extent we believe these possibilities
present attractive opportunities. However, there can be no assurance that we
will actually complete any acquisitions, dispositions or system swaps, or that
any such transactions will be material to our operations or results.


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Recent Events

In January 2022, CCO Holdings, LLC ("CCO Holdings") and CCO Holdings Capital
Corp. jointly issued $1.2 billion of 4.750% senior unsecured notes due February
2032 at par. The net proceeds were used for general corporate purposes,
including to fund buybacks of Charter Class A common stock and Charter Holdings
common units, to repay certain indebtedness and to pay related fees and
expenses.

In addition to the debt issued in January 2022 as described above, CCO Holdings
and CCO Holdings Capital Corp. jointly issued $3.75 billion aggregate principal
amount of senior unsecured notes in 2021 at varying rates, prices and maturity
dates, and Charter Operating and Charter Communications Operating Capital Corp.
jointly issued $9.8 billion aggregate principal amount of senior secured notes
in 2021 at varying rates, prices and maturity dates. The net proceeds were used
to pay related fees and expenses and for general corporate purposes, including
funding buybacks of Charter Class A common stock and Charter Holdings common
units as well as repaying certain indebtedness.

Free movement of capital

Free cash flow increased $1.6 billion during the year ended December 31, 2021
compared to the corresponding prior period due to the following (dollars in
millions).

                                                                             2021 compared to
                                                                                   2020
Increase in Adjusted EBITDA                                                  $       2,112
Increase in capital expenditures                                            

(220)

Increase in cash paid for interest, net                                     

(193)

Change in working capital, excluding change in accrued interest                       (109)
Other, net                                                                              24
                                                                             $       1,614


Free cash flow was reduced by $853 million and $1.1 billion over the past years December 31, 2021 and 2020, respectively, due to mobile with impacts negatively affecting working capital, capital expenditures and adjusted EBITDA.

Historical operating, investing and financing activities

Cash and cash equivalents. We held $601 million and $1.0 billion in cash and cash equivalents at December 31, 2021 and 2020, respectively.

Operating Activities. Net cash provided by operating activities increased $1.7
billion during the year ended December 31, 2021 compared to the year ended
December 31, 2020, primarily due to an increase in Adjusted EBITDA of $2.1
billion offset by changes in working capital, excluding the change in accrued
interest and accrued expenses related to capital expenditures, that used $266
million more cash and $193 million higher cash paid for interest.

Investing Activities. Net cash used in investing activities for the years ended
December 31, 2021 and 2020 was $7.8 billion and $8.2 billion, respectively. The
decrease in cash used was primarily due the purchase of spectrum wireless
licenses in 2020 offset by an increase in capital expenditures in 2021.

Financing Activities. Net cash used in financing activities decreased $68
million during the year ended December 31, 2021 compared to the year ended
December 31, 2020 primarily due to an increase in the amount by which borrowings
of long-term debt exceeded repayments offset by an increase in the purchase of
treasury stock and noncontrolling interest and a decrease in equity exercises.

Capital expenditure

We have significant ongoing capital expenditure requirements.  Capital
expenditures were $7.6 billion and $7.4 billion for the years ended December 31,
2021 and 2020, respectively. The increase was primarily due to an increase in
scalable infrastructure driven by augmentation of network capacity for customer
growth and usage, with incremental spending to reclaim network headroom
maintained prior to COVID-19. See the table below for more details.


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We currently expect full year 2022 cable capital expenditures, excluding capital
expenditures associated with our rural construction initiative, to be between
$7.1 billion and $7.3 billion. The actual amount of our capital expenditures in
2022 will depend on a number of factors including further spend related to
product development and growth rates of both our residential and commercial
businesses as well as the pace of rural construction.

Our capital expenditures are funded primarily from cash flows from operating
activities and borrowings on our credit facility. In addition, our accrued
liabilities related to capital expenditures increased $80 million and decreased
$77 million for the years ended December 31, 2021 and 2020, respectively.

The following tables present our main categories of capital expenditures in accordance with National Cable and Telecommunications Association (“NCTA”) disclosure guidelines for fiscal years ended December 31, 2021 and 2020. These disclosure guidelines are non-GAAP disclosures and do not impact our accounting for capital expenditures under GAAP ($ millions):

                                                            Year ended December 31,
                                                               2021         

2020

Customer premise equipment (a)                        $      1,967               $ 2,002
Scalable infrastructure (b)                                  1,677                 1,478
Line extensions (c)                                          1,642                 1,641
Upgrade/rebuild (d)                                            706                   615
Support capital (e)                                          1,643                 1,679
Total capital expenditures                            $      7,635               $ 7,415

Capital expenditures included in total related to:
Commercial services                                   $      1,445               $ 1,325
Mobile                                                $        482               $   508



(a)Customer premise equipment includes costs incurred at the customer residence
to secure new customers and revenue generating units, including customer
installation costs and customer premise equipment (e.g., digital receivers and
cable modems).
(b)Scalable infrastructure includes costs not related to customer premise
equipment, to secure growth of new customers and revenue generating units, or
provide service enhancements (e.g., headend equipment).
(c)Line extensions include network costs associated with entering new service
areas (e.g., fiber/coaxial cable, amplifiers, electronic equipment, make-ready
and design engineering).
(d)Upgrade/rebuild includes costs to modify or replace existing fiber/coaxial
cable networks, including betterments.
(e)Support capital includes costs associated with the replacement or enhancement
of non-network assets due to technological and physical obsolescence (e.g.,
non-network equipment, land, buildings and vehicles).

Debt

From December 31, 2021, the cumulative value of our total debt was approximately
$91.6 billion, as summarized below (in millions of dollars):

                                              December 31, 2021
                                       Principal         Accreted Value
                                        Amount                 (a)                 Interest Payment Dates             Maturity Date (b)
CCO Holdings, LLC:
4.000% senior notes due 2023         $      500          $        499                               3/1 & 9/1                     3/1/2023
5.500% senior notes due 2026                750                   747                              5/1 & 11/1                     5/1/2026
5.125% senior notes due 2027              3,250                 3,228                              5/1 & 11/1                     5/1/2027
5.000% senior notes due 2028              2,500                 2,475                               2/1 & 8/1                     2/1/2028
5.375% senior notes due 2029              1,500                 1,500                              6/1 & 12/1                     6/1/2029
4.750% senior notes due 2030              3,050                 3,043                               3/1 & 9/1                     3/1/2030
4.500% senior notes due 2030              2,750                 2,750                             2/15 & 8/15                    8/15/2030
4.250% senior notes due 2031              3,000                 3,002                               2/1 & 8/1                     2/1/2031



                                       41
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4.500% senior notes due 2032                 2,900              2,927                      5/1 & 11/1                5/1/2032
4.500% senior notes due 2033                 1,750              1,729                      6/1 & 12/1                6/1/2033
4.250% senior notes due 2034                 2,000              1,982                     1/15 & 7/15               1/15/2034
Charter Communications Operating, LLC:
4.464% senior notes due 2022                 3,000              2,997                     1/23 & 7/23               7/23/2022
Senior floating rate notes due 2024            900                901            2/1, 5/1, 8/1 & 11/1                2/1/2024
4.500% senior notes due 2024                 1,100              1,096                       2/1 & 8/1                2/1/2024
4.908% senior notes due 2025                 4,500              4,480                     1/23 & 7/23               7/23/2025
3.750% senior notes due 2028                 1,000                990                     2/15 & 8/15               2/15/2028
4.200% senior notes due 2028                 1,250              1,242                     3/15 & 9/15               3/15/2028
2.250% senior notes due 2029                 1,250              1,240                     1/15 & 7/15               1/15/2029
5.050% senior notes due 2029                 1,250              1,242                     3/30 & 9/30               3/30/2029
2.800% senior notes due 2031                 1,600              1,585                      4/1 & 10/1                4/1/2031
2.300% senior notes due 2032                 1,000                992                       2/1 & 8/1                2/1/2032
6.384% senior notes due 2035                 2,000              1,984                    4/23 & 10/23              10/23/2035
5.375% senior notes due 2038                   800                787                      4/1 & 10/1                4/1/2038
3.500% senior notes due 2041                 1,500              1,483                      6/1 & 12/1                6/1/2041
3.500% senior notes due 2042                 1,350              1,331                       3/1 & 9/1                3/1/2042
6.484% senior notes due 2045                 3,500              3,468                    4/23 & 10/23              10/23/2045
5.375% senior notes due 2047                 2,500              2,506                      5/1 & 11/1                5/1/2047
5.750% senior notes due 2048                 2,450              2,393                      4/1 & 10/1                4/1/2048
5.125% senior notes due 2049                 1,250              1,240                       1/1 & 7/1                7/1/2049
4.800% senior notes due 2050                 2,800              2,797                       3/1 & 9/1                3/1/2050
3.700% senior notes due 2051                 2,050              2,031                      4/1 & 10/1                4/1/2051
3.900% senior notes due 2052                 2,400              2,322                      6/1 & 12/1                6/1/2052
6.834% senior notes due 2055                   500                495                    4/23 & 10/23              10/23/2055
3.850% senior notes due 2061                 1,850              1,809                      4/1 & 10/1                4/1/2061
4.400% senior notes due 2061                 1,400              1,389                      6/1 & 12/1               12/1/2061
3.950% senior notes due 2062                 1,400              1,379                    6/30 & 12/30               6/30/2062
Credit facilities                           10,723             10,668                                                  Varies
Time Warner Cable, LLC:
5.750% sterling senior notes due 2031
(c)                                            846                897                             6/2                6/2/2031
6.550% senior debentures due 2037            1,500              1,662                      5/1 & 11/1                5/1/2037
7.300% senior debentures due 2038            1,500              1,754                       1/1 & 7/1                7/1/2038
6.750% senior debentures due 2039            1,500              1,700                    6/15 & 12/15               6/15/2039
5.875% senior debentures due 2040            1,200              1,252                    5/15 & 11/15              11/15/2040
5.500% senior debentures due 2041            1,250              1,257                       3/1 & 9/1                9/1/2041
5.250% sterling senior notes due 2042
(d)                                            879                850                            7/15               7/15/2042
4.500% senior debentures due 2042            1,250              1,148                     3/15 & 9/15               9/15/2042
Time Warner Cable Enterprises LLC:
8.375% senior debentures due 2023            1,000              1,058                     3/15 & 9/15               3/15/2023
8.375% senior debentures due 2033            1,000              1,254                     7/15 & 1/15               7/15/2033
                                         $  91,198          $  91,561



(a)The accreted values presented in the table above represent the principal
amount of the debt adjusted for original issue discount or premium at the time
of sale, deferred financing costs, and, in regards to debt assumed in
acquisitions, fair value premium adjustments as a result of applying acquisition
accounting plus the accretion of those amounts to the balance sheet date.
However, the amount that is currently payable if the debt becomes immediately
due is equal to the principal amount of the debt. In regards to the Sterling
Notes, the principal amount of the debt and any premium or discount is
remeasured into US dollars as of each balance sheet date. We have availability
under our credit facilities of approximately $3.9 billion as of December 31,
2021.
(b)In general, the obligors have the right to redeem all of the notes set forth
in the above table in whole or in part at their option, beginning at various
times prior to their stated maturity dates, subject to certain conditions, upon
the payment of the outstanding principal amount (plus a specified redemption
premium) and all accrued and unpaid interest.

                                       42
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(c) Principal amount includes £625 million valued at $846 million from
December 31, 2021 using the current exchange rate December 31, 2021. (d) Principal amount includes £650 million valued at $879 million from
December 31, 2021 using the current exchange rate December 31, 2021.

See Note 9 to the accompanying consolidated financial statements contained in
"Part II. Item 8. Financial Statements and Supplementary Data" for further
details regarding our outstanding debt and other financing arrangements,
including certain information about maturities, covenants and restrictions
related to such debt and financing arrangements. The agreements and instruments
governing our debt and financing arrangements are complicated and you should
consult such agreements and instruments which are filed with the SEC for more
detailed information.

At December 31, 2021, Charter Operating had a consolidated leverage ratio of
approximately 3.0 to 1.0 and a consolidated first lien leverage ratio of 2.9 to
1.0. Both ratios are in compliance with the ratios required by the Charter
Operating credit facilities of 5.0 to 1.0 consolidated leverage ratio and 4.0 to
1.0 consolidated first lien leverage ratio. A failure by Charter Operating to
maintain the financial covenants would result in an event of default under the
Charter Operating credit facilities and the debt of CCO Holdings. See "Part I.
Item 1A. Risk Factors - The agreements and instruments governing our debt
contain restrictions and limitations that could significantly affect our ability
to operate our business, as well as significantly affect our liquidity."

Recently issued accounting standards

See Note 24 to the accompanying consolidated financial statements contained in
"Part II. Item 8. Financial Statements and Supplementary Data" for a discussion
of recently issued accounting standards.

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