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                                                                      EXHIBIT 99

                                  RISK FACTORS


OUR STRUCTURE

MR. ALLEN MAY HAVE INTERESTS THAT CONFLICT WITH YOUR INTERESTS.

         Mr. Allen controls approximately 93.5% of the voting power of Charter
Communications, Inc.'s capital stock and this has the ability to control
fundamental corporate transactions requiring Charter Communications, Inc.
equity holder approval, including, but not limited to, the election of all of
Charter Communications, Inc.'s directors, approval of merger transactions
involving us and the sale of all or substantially all of our assets. Through his
control of Charter Communications, Inc., Mr. Allen controls Charter
Communications Holding Company and Charter Holdings.

         Mr. Allen's control over our management and affairs could create
conflicts of interest if he is faced with decisions that could have implications
both for him and for us and the holders of our public debt. Further, through his
effective control, Mr. Allen could cause us to enter into contracts with another
entity in which he owns an interest or cause us to decline a transaction that he
(or another entity in which he owns an interest) ultimately enters into.

         Mr. Allen may engage in other businesses involving the operation of
cable television systems, video programming, high-speed Internet access,
telephony or electronic commerce. Mr. Allen may also engage in other businesses
that compete or may in the future compete with us. In addition, Mr. Allen
currently engages and may engage in the future in businesses that are
complementary to our cable business.

         Accordingly, conflicts could arise with respect to the allocation of
corporate opportunities between us and Mr. Allen. Current or future agreements
between us and Mr. Allen or his affiliates may not be the result of arm's-length
negotiations. Consequently, such agreements may be less favorable to us than
agreements that we could otherwise have entered into with unaffiliated third
parties. Further, many past and
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future transactions with Mr. Allen or his affiliates are informal in nature. As
a result, there will be some discretion left to the parties, who are subject to
the potentially conflicting interests described above. We cannot assure you that
the interests of either Mr. Allen or his affiliates will not conflict with the
interests of the holders of our public debt. We have not instituted any formal
plans to address conflicts of interest that may arise.


WE ARE NOT PERMITTED TO ENGAGE IN ANY BUSINESS ACTIVITY OTHER THAN THE CABLE
TRANSMISSION OF VIDEO, AUDIO AND DATA UNLESS MR. ALLEN AUTHORIZES US TO PURSUE
THAT PARTICULAR BUSINESS ACTIVITY. THIS COULD ADVERSELY AFFECT OUR ABILITY TO
OFFER NEW PRODUCTS AND SERVICES OUTSIDE OF THE CABLE TRANSMISSION BUSINESS AND
ENTER INTO NEW BUSINESSES, WHICH COULD ADVERSELY AFFECT OUR GROWTH, FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.

         Charter Communications, Inc.'s certificate of incorporation and Charter
Communications Holding Company's limited liability company agreement provide
that Charter Communications, Inc. and Charter Communications Holding Company and
their subsidiaries, including Charter Holdings and its subsidiaries, cannot
engage in any business activity outside the cable transmission business except
for specified businesses. This will be the case unless the opportunity to pursue
the particular business activity is first offered to Mr. Allen, he decides not
to pursue it and he consents to our engaging in the business activity. The cable
transmission business means the business of transmitting video, audio, including
telephone services, and data over cable television systems owned, operated or
managed by us from time to time. These provisions may limit our ability to take
advantage of attractive business opportunities. Consequently, our ability to
offer new products and services outside of the cable transmission business and
enter into new businesses could be adversely affected, resulting in an adverse
effect on our growth, financial condition and results of operations.
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CHARTER HOLDINGS IS A HOLDING COMPANY WHICH HAS NO OPERATIONS AND WILL DEPEND ON
ITS OPERATING SUBSIDIARIES FOR CASH TO MAKE PAYMENTS ON ITS DEBT SECURITIES.
CHARTER HOLDINGS' SUBSIDIARIES ARE LIMITED IN THEIR ABILITY TO MAKE FUNDS
AVAILABLE FOR THE PAYMENT OF ITS DEBT SECURITIES AND OTHER OBLIGATIONS.

         As a holding company, we depend entirely on cash from our operating
subsidiaries to satisfy our obligations to the holders of our debt securities.
Our operating subsidiaries may not be able to make funds available to us.

         We will not hold any significant assets other than our direct and
indirect interests in our subsidiaries which conduct all of our operations. Our
cash flow will depend upon the cash flow of our operating subsidiaries and the
payment of funds by our operating subsidiaries to us. This could adversely
affect our ability to meet our obligations to you as a holder of the notes.

         Our operating subsidiaries are separate and distinct legal entities and
are not obligated to make funds available for payment of the notes and other
obligations in the form of loans, distributions or otherwise. In addition, our
operating subsidiaries' ability to make any such loans, distributions or other
payments to us will depend on their earnings, business and tax considerations
and legal restrictions. Furthermore, covenants in the indentures and credit
agreements governing the debt of our subsidiaries restrict their ability to make
loans, distributions or other payments to us. This could adversely impact our
ability to pay amounts due on our debt securities.
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OUR MANAGEMENT MAY BE RESPONSIBLE FOR MANAGING OTHER CABLE OPERATIONS AND MAY
NOT DEVOTE THEIR FULL TIME TO OUR OPERATIONS. THIS COULD GIVE RISE TO CONFLICTS
OF INTEREST AND IMPAIR OUR OPERATING RESULTS.

         Mr. Allen and certain other of our affiliates may from time to time in
the future acquire cable systems in addition to those owned by us. Charter
Communications, Inc., as well as some of the officers of Charter Communications,
Inc. who currently manage our cable systems, may have a substantial role in
managing outside cable systems that may be acquired in the future. As a result,
the time they devote to managing our systems may be correspondingly reduced.
This could adversely affect our growth, financial condition and results of
operations. Moreover, allocating our managers' time and other resources of
Charter Communications, Inc. and Charter Communications Holding Company between
our systems and outside systems that may be held by our affiliates could give
rise to conflicts of interest. Charter Communications, Inc. and Charter
Communications Holding Company do not have or plan to create formal procedures
for determining whether and to what extent cable systems acquired in the future
will receive priority with respect to personnel requirements.



OUR BUSINESS

WE AND OUR SUBSIDIARIES HAVE SUBSTANTIAL EXISTING DEBT AND WILL INCUR
SUBSTANTIAL ADDITIONAL DEBT, WHICH COULD ADVERSELY AFFECT OUR FINANCIAL HEALTH
AND OUR ABILITY TO OBTAIN FINANCING IN THE FUTURE AND REACT TO CHANGES IN OUR
BUSINESS.

         We and our subsidiaries have a significant amount of debt. As of
December 31, 2000, pro forma for the sale of the January 2001 Charter Holdings
notes and the application of these proceeds to repay all remaining amounts
outstanding under the Charter Holdings 2000 senior bridge loan facility and the
Fanch revolving credit facility, and a portion of the amounts outstanding under
the Charter Operating and Falcon revolving credit facilities, our total debt
would have been approximately $12.4 billion and the deficiency of our earnings
available to cover fixed charges would have been approximately $2.1 billion.

         Our significant amount of debt could have important consequences. For
example, it could:

     -    make it more difficult for us to satisfy our obligations to the
          lenders under our subsidiaries' credit facilities and to our public
          noteholders;

     -    increase our vulnerability to general adverse economic and cable
          industry conditions, including interest rate increases, because a
          significant portion of our borrowings are and will continue to be at
          variable rates of interest;

     -    require us to dedicate a substantial portion of our cash flow from
          operations to payments on our debt, which will reduce our funds
          available for working capital, capital expenditures and other general
          corporate expenses;

     -    limit our flexibility in planning for, or reacting to, changes in our
          business and the cable industry;

     -    place us at a disadvantage compared to our competitors that have
          proportionately less debt; and
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     -    limit our ability to borrow additional funds in the future, if we need
          them, due to applicable financial and restrictive covenants in our
          debt.

         We anticipate incurring significant additional debt in the future to
fund the expansion, maintenance and upgrade of our cable systems. If current
debt levels increase, the related risks that we now face will intensify.


THE AGREEMENTS AND INSTRUMENTS GOVERNING OUR DEBT AND THE DEBT OF OUR
SUBSIDIARIES CONTAIN RESTRICTIONS AND LIMITATIONS THAT COULD SIGNIFICANTLY
IMPACT OUR ABILITY TO OPERATE OUR BUSINESS AND ADVERSELY AFFECT THE HOLDERS OF
OUR DEBT SECURITIES.

         The credit facilities of our subsidiaries and the indentures governing
our debt and the debt of our subsidiaries contain a number of significant
covenants that could adversely impact our business and adversely affect the
holders of our debt securities. In particular, our credit facilities and
indentures and that of our subsidiaries restrict our ability and the ability of
our subsidiaries to:

     -    pay dividends or make other distributions;

     -    make certain investments or acquisitions;

     -    dispose of assets or merge;

     -    incur additional debt;

     -    issue equity;

     -    repurchase or redeem equity interests and debt;

     -    create liens; and

     -    pledge assets.

         Furthermore, in accordance with our subsidiaries' credit facilities, a
number of our subsidiaries are required to maintain specified financial ratios
and meet financial tests. The ability to comply with these provisions may be
affected by events beyond our control. The breach of any of these covenants will
result in a default under the applicable debt agreement or instrument.


OUR ABILITY TO GENERATE THE SIGNIFICANT AMOUNT OF CASH NEEDED TO SERVICE OUR
DEBT AND THE DEBT OF OUR SUBSIDIARIES AND GROW OUR BUSINESS DEPENDS ON MANY
FACTORS BEYOND OUR CONTROL.

         Our ability to service our debt and to fund our planned capital
expenditures for upgrading our cable systems and our ongoing operations will
depend on our ability to generate cash and to secure financing in the future.
This, to a certain extent, is subject to general economic, financial,
competitive, legislative, regulatory and other factors beyond our control. If
our business does not generate sufficient cash flow from operations, and
sufficient future distributions are not available to us from borrowings under
our credit facilities or from other sources of financing, we may not be able to
repay our debt or to grow our business or fund our other liquidity needs.
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PROSPECTIVE LENDERS' COMMITMENTS TO LEND TO US UNDER THE 2001 SENIOR BRIDGE LOAN
FACILITY WE HAVE OBTAINED ARE SUBJECT TO A NUMBER OF CONDITIONS. IF THESE
CONDITIONS ARE NOT MET, THESE FUNDS WILL NOT BE AVAILABLE TO US. AS A RESULT, WE
MAY BE UNABLE TO CONSUMMATE PENDING ACQUISITIONS WHICH COULD TRIGGER DEFAULTS
UNDER OUR ACQUISITION AGREEMENTS AND OUR DEBT OBLIGATIONS. IF THIS WERE TO
OCCUR, THE RELEVANT SELLERS OR CREDITORS COULD INITIATE LEGAL PROCEEDINGS
AGAINST US.

         The 2001 senior bridge loan facility for which we have received
commitments will not close unless specified closing conditions are satisfied.
Some of these closing conditions are not under our control, and we cannot assure
you that all closing conditions will be satisfied. For example, the closing
conditions for these facilities include:

     -    the absence of various types of material adverse changes, including
          material adverse changes in the financial and capital markets; and

     -    receipt of required approvals from third parties.

         If the committed 2001 senior bridge loan facility is not closed, we
would need to raise $2.0 billion to replace it, and we cannot assure you that
alternate financing sources will be available to us. Our affiliates may as a
result be unable to consummate pending AT&T transactions and may be in default
under the related acquisition agreements. The relevant sellers could initiate
legal proceedings against us, including under bankruptcy and reorganization
laws, for any damages they suffer as a result of our non-performance. Any such
action could trigger defaults under our other obligations, including our credit
facilities and debt instruments.


WE HAVE GROWN RAPIDLY AND HAVE A LIMITED HISTORY OF OPERATING OUR CURRENT
SYSTEMS. THIS MAKES IT DIFFICULT FOR YOU TO COMPLETELY EVALUATE OUR PERFORMANCE.

         We commenced active operations in 1994 and have grown rapidly since
then through acquisitions of cable systems. As of December 31, 2000, our systems
served approximately 400% more customers than were served as of December 31,
1998. As a result, historical financial information about us may not be
indicative of the future or of results that we can achieve with the cable
systems under our control. Our recent growth in revenues over our short
operating history is not necessarily indicative of future performance.

WE HAVE A HISTORY OF NET LOSSES AND EXPECT TO CONTINUE TO EXPERIENCE NET LOSSES.
CONSEQUENTLY, WE MAY NOT HAVE THE ABILITY TO FINANCE FUTURE OPERATIONS.

         We have had a history of net losses and expect to continue to report
net losses for the foreseeable future. We expect our net losses to increase as a
result of our closed acquisitions and our planned upgrades and other capital
expenditures. We reported net losses before minority interest in loss of
subsidiary and extraordinary items of $22 million for 1998 and $639 million for
1999 and $2.1 billion for 2000. On a pro forma basis, giving effect to the
merger of Charter Holdings and Marcus Holdings, acquisitions in 1999 and 2000,
the sale of an insignificant subsidiary in December 2000, the sale of the March
1999 and January 2000 Charter Holdings notes, the drawdown on the Charter
Holdings 2000 senior bridge loan facility, application of the net proceeds
contributed to us from the sale of Charter Communications, Inc.'s convertible
senior notes and the sale of the January 2001 Charter Holdings notes and the
application of the net proceeds, we had net losses before minority interest in
loss of subsidiary and extraordinary item of $1.5 billion for 1999 and $2.1
billion for 2000. We cannot predict what impact, if any, continued losses will
have on our ability to finance our operations in the future.
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WE MAY NOT HAVE THE ABILITY TO INTEGRATE THE NEW CABLE SYSTEMS THAT WE ACQUIRE
AND THE CUSTOMERS THEY SERVE WITH OUR EXISTING CABLE SYSTEMS. THIS COULD
ADVERSELY AFFECT OUR OPERATING RESULTS AND GROWTH STRATEGY.

         We have grown rapidly through acquisitions of cable systems, and now
own and operate cable systems serving approximately 6.4 million customers. We
may acquire more cable systems in the future, through acquisitions, system swaps
or otherwise. The integration of newly acquired cable systems poses a number of
significant risks, including:

     -    our acquisitions may not have a positive impact on our cash flows from
          operations;

     -    the integration of new systems and customers will place significant
          demands on our management and our operations, information services,
          and financial, legal and marketing resources. Our current operating
          and financial systems and controls and information services may not be
          adequate, and any steps taken to improve these systems and controls
          may not be sufficient;

     -    acquired businesses sometimes result in unexpected liabilities and
          contingencies which could be significant; and

     -    our continued growth will also increase our need for qualified
          personnel. We may not be able to hire such additional qualified
          personnel.

         We cannot assure you that we will successfully integrate any acquired
systems into our operations.


IF WE ARE UNSUCCESSFUL IN IMPLEMENTING OUR GROWTH STRATEGY, OUR FINANCIAL
CONDITION AND RESULTS OF OPERATIONS COULD BE ADVERSELY AFFECTED.

         If we are unable to grow our cash flow sufficiently, we may be unable
to repay our debt, to grow our business or to fund our other liquidity needs. We
expect that a substantial portion of our future growth will be achieved through
revenues from new products and services. We may not be able to offer these new
products and services successfully to our customers and these new products and
services may not generate adequate revenues.

OUR PROGRAMMING COSTS ARE INCREASING. WE MAY NOT HAVE THE ABILITY TO PASS THESE
INCREASES ON TO OUR CUSTOMERS, WHICH WOULD ADVERSELY AFFECT OUR CASH FLOW AND
OPERATING MARGINS.

         Programming has been, and is expected to continue to be, our largest
single expense item. In recent years, the cable industry has experienced a rapid
escalation in the cost of programming, particularly sports programming. This
escalation may continue, and we may not be able to pass programming cost
increases on to our customers. The inability to pass these programming cost
increases on to our customers would have an adverse impact on our cash flow and
operating margins. In addition, as we upgrade the channel capacity of our
systems and add programming to our basic, expanded basic and premium programming
tiers, we may face additional market constraints on our ability to pass
programming costs on to our customers. Basic programming includes a variety of
entertainment and local programming. Expanded basic programming offers more
services than basic programming. Premium service includes unedited,
commercial-free movies, sports and other special event entertainment
programming.
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WE MAY NOT BE ABLE TO OBTAIN CAPITAL SUFFICIENT TO FUND OUR PLANNED UPGRADES AND
OTHER CAPITAL EXPENDITURES. THIS COULD ADVERSELY AFFECT OUR ABILITY TO OFFER NEW
PRODUCTS AND SERVICES, WHICH COULD ADVERSELY AFFECT OUR GROWTH, FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.

         Without giving effect to the pending AT&T transactions, in 2001, 2002
and 2003, we expect to spend a total of approximately $2.9 billion, $1.75
billion and $950,000, respectively, to upgrade and rebuild our systems in order
to offer advanced services to our customers. In addition, we anticipate rebuild
costs associated with the AT&T systems we expect to acquire to total
approximately $350 million. The amount that we spend on these types of capital
expenditures will depend on the level of growth in digital cable customers and
in the delivery of other advanced services.

         We cannot assure you that our anticipated levels of capital
expenditures will be sufficient to accomplish our planned system upgrades,
maintenance and expansion, or to roll out advanced services. Currently, a
projected $500 million to $750 million funding shortfall exists regarding
anticipated capital expenditures through late 2000 or early 2003, when we expect
to become cash flow positive. If we borrow the full amount available under the
2001 bridge loan commitment, our planned capital expenditures are funded through
the end of 2002 and our funding shortfall will be $300 million to $500 million
through 2003. The amount of this expected shortfall could increase if there is
accelerated growth in digital cable customers or in the delivery of other
advanced services. If we cannot obtain the necessary funds from increases in our
operating cash flow, additional borrowings or other sources, we may not be able
to fund our planned upgrades and expansion and offer advanced services on a
timely basis. Consequently, our growth, financial condition and results of
operations could suffer materially.


WE MAY NOT BE ABLE TO FUND THE CAPITAL EXPENDITURES NECESSARY TO KEEP PACE WITH
TECHNOLOGICAL DEVELOPMENTS OR OUR CUSTOMERS' DEMAND FOR NEW PRODUCTS AND
SERVICES. THIS COULD LIMIT OUR ABILITY TO COMPETE EFFECTIVELY. CONSEQUENTLY, OUR
GROWTH, RESULTS OF OPERATIONS AND FINANCIAL CONDITION COULD SUFFER MATERIALLY.

         The cable business is characterized by rapid technological change and
the introduction of new products and services. We cannot assure you that we will
be able to fund the capital expenditures necessary to keep pace with
technological developments, or that we will successfully anticipate the demand
of our customers for products and services requiring new technology. This type
of rapid technological change could adversely affect our plans to upgrade or
expand our systems and respond to competitive pressures. Our inability to
upgrade, maintain and expand our systems and provide advanced services in a
timely manner, or to anticipate the demands of the market place, could adversely
affect our ability to compete. Consequently, our growth, financial condition and
results of operations could suffer materially.

WE MAY BE UNABLE TO NEGOTIATE CONSTRUCTION CONTRACTS ON FAVORABLE TERMS AND OUR
CONSTRUCTION COSTS MAY INCREASE SIGNIFICANTLY. THIS COULD ADVERSELY AFFECT OUR
GROWTH, FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

         The expansion and upgrade of our systems will require us to hire
contractors and enter into a number of construction agreements. We may have
difficulty hiring civil contractors, and the contractors we hire may encounter
cost overruns or delays in construction. Our construction costs may increase
significantly over the next few years as existing contracts expire and as demand
for telecommunications construction services continues to grow. We cannot assure
you that we will be able to construct new systems or expand or upgrade existing
or acquired systems in a timely manner or at a reasonable cost. This may
adversely affect our growth, financial condition and results of operations.
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WE DEPEND ON THIRD-PARTY EQUIPMENT AND SOFTWARE SUPPLIERS. IF WE ARE UNABLE TO
PROCURE THE NECESSARY EQUIPMENT, OUR ABILITY TO OFFER OUR SERVICES COULD BE
IMPAIRED. THIS COULD ADVERSELY AFFECT OUR GROWTH, FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.

         We depend on vendors to supply the set-top terminals for analog and
digital cable services. This equipment is available from a limited number of
suppliers. We typically purchase set-top terminals under purchase orders placed
from time to time and do not carry significant inventories of set-top terminals.
If demand for set-top terminals exceeds our inventories and we are unable to
obtain required set-top terminals on a timely basis and at an acceptable cost,
our ability to recognize additional revenue from digital services could be
delayed or impaired. In addition, if there are no suppliers who are able to
provide set-top terminal devices that comply with evolving Internet and
telecommunications standards or that are compatible with other products or
components we use, our business would be impaired.

THERE IS NO EXPECTATION THAT MR. ALLEN WILL FUND OUR OPERATIONS OR OBLIGATIONS
IN THE FUTURE.

         In the past, Mr. Allen and his affiliates have contributed funds to
Charter Communications, Inc., Charter Communications Holding Company and us.
There is no expectation that Mr. Allen or his affiliates will contribute funds
to Charter Communications, Inc., Charter Communications Holding Company or to us
or our subsidiaries in the future.

A SALE BY MR. ALLEN OF HIS DIRECT OR INDIRECT EQUITY INTERESTS COULD ADVERSELY
AFFECT OUR ABILITY TO MANAGE OUR BUSINESS.

         Mr. Allen is not prohibited by any agreement from selling the shares of
Class A or Class B common stock he holds in Charter Communications, Inc. or
causing Charter Investment, Inc. or Vulcan Cable III Inc. to sell their
membership units in Charter Communications Holding Company. We cannot assure you
that Mr. Allen or any of his affiliates will maintain all or any portion of his
direct or indirect ownership interests in Charter Communications, Inc. or
Charter Communications Holding Company. In the event he sells all or any portion
of his direct or indirect ownership interest in Charter Communications, Inc. or
Charter Communications Holding Company, we cannot assure you that he would
continue as Chairman of Charter Communications, Inc.'s board of directors or
otherwise participate in our management. The disposition by Mr. Allen or any of
his affiliates of these equity interests or the loss of his services by Charter
Communications, Inc. and/or Charter Communications Holding Company could
adversely affect our growth, financial condition and results of operations, or
adversely impact the market price of our securities.

WE OPERATE IN A VERY COMPETITIVE BUSINESS ENVIRONMENT WHICH CAN ADVERSELY AFFECT
OUR BUSINESS AND OPERATIONS.

         The industry in which we operate is highly competitive. In some
instances, we compete against companies with fewer regulatory burdens, easier
access to financing, greater personnel resources, greater brand name recognition
and long-standing relationships with regulatory authorities. Mergers, joint
ventures and alliances among any of the following businesses could result in
providers capable of offering cable television, Internet and other
telecommunications services in direct competition with us:

     -    cable television operators;

     -    local and regional telephone companies;

     -    long distance telephone service providers;

     -    direct broadcast satellite (DBS) companies;
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     -    electric utilities;

     -    providers of cellular and other wireless communications services; and

     -    Internet service providers.

         We face competition within the subscription television industry, which
includes providers of paid television service employing technologies other than
cable, such as direct broadcast satellite or DBS. We also face competition from
broadcast companies distributing television broadcast signals without assessing
a subscription fee and from other communications and entertainment media,
including conventional radio broadcasting services, newspapers, movie theaters,
the Internet, live sports events and home video products.

         We cannot assure you that upgrading our cable systems will allow us to
compete effectively. Additionally, as we expand and introduce new and enhanced
services, including Internet and telecommunications services, we will be subject
to competition from telecommunications providers and Internet service providers.
We cannot predict the extent to which competition may affect our business and
operations in the future.


THE LOSS OF MR. ALLEN OR MR. KENT COULD ADVERSELY AFFECT OUR ABILITY TO MANAGE
OUR BUSINESS.

         Our success is substantially dependent upon the retention and the
continued performance of Mr. Allen, Chairman of Charter Communications, Inc.'s
board of directors, and Jerald L. Kent, Charter Communications, Inc.'s President
and Chief Executive Officer. The loss of the services of Mr. Allen or Mr. Kent
could adversely affect our growth, financial condition and results of
operations.


REGULATORY AND LEGISLATIVE MATTERS

OUR BUSINESS IS SUBJECT TO EXTENSIVE GOVERNMENTAL LEGISLATION AND REGULATION.
THE APPLICABLE LEGISLATION AND REGULATIONS, AND CHANGES TO THEM, COULD ADVERSELY
AFFECT OUR BUSINESS BY INCREASING OUR EXPENSES.

         Regulation of the cable industry has increased the administrative and
operational expenses and limited the revenues of cable systems. Cable operators
are subject to, among other things:

     -    limited rate regulation;

     -    requirements that, under specified circumstances, a cable system carry
          a local broadcast station or obtain consent to carry a local or
          distant broadcast station; - rules for franchise renewals and
          transfers; and

     -    other requirements covering a variety of operational areas such as
          technical standards and customer service requirements.

         Additionally, many aspects of these regulations are currently the
subject of judicial proceedings and administrative or legislative proposals.
There are also ongoing efforts to amend or expand the state and local regulation
of some of our cable systems, which may compound the regulatory risks we already
face. Certain states and localities are considering new telecommunications taxes
that could increase operating
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expenses. We cannot predict whether in response to these efforts any of the
states or localities in which we now operate will expand regulation of our cable
systems in the future or how they will do so.


WE MAY BE REQUIRED TO PROVIDE ACCESS TO OUR NETWORKS TO OTHER INTERNET SERVICE
PROVIDERS. THIS COULD SIGNIFICANTLY INCREASE OUR COMPETITION AND ADVERSELY
AFFECT THE UPGRADE OF OUR SYSTEMS OR OUR ABILITY TO PROVIDE NEW PRODUCTS AND
SERVICES.

         Recently, a number of companies, including telephone companies and
Internet service providers (ISP), have requested local authorities and the
Federal Communications Commission to require cable operators to provide access
to cable's broadband infrastructure, which allows cable to deliver a multitude
of channels and/or services, so that these companies may deliver Internet
services directly to customers over cable facilities. A federal district court
in Virginia, a federal district court in Florida and a federal circuit court in
California recently struck down as unlawful "open-access" requirements imposed
by a variety of franchising authorities. Each of these decisions struck down the
"open-access" requirements on different legal grounds. In response to the
federal circuit decision, the Federal Communications Commission recently
initiated an inquiry to determine the appropriate classification and regulatory
treatment of the provision of Internet service by cable operators. It separately
initiated a similar inquiry regarding the provision of interactive television
services by cable operators. The Federal Trade Commission and the Federal
Communications Commission recently imposed certain "open-access" requirements on
Time Warner and AOL in connection with their merger, but those requirements are
not applicable to other cable operators.

         We believe that allocating a portion of our bandwidth capacity to other
Internet service providers:

     -    would impair our ability to use our bandwidth in ways that would
          generate maximum revenues;

     -    would strengthen our Internet service provider competitors; and

     -    may cause us to decide not to upgrade our systems which would prevent
          us from introducing our planned new products and services.

         In addition, we cannot assure you that if we were required to provide
access in this manner, it would not have a significant adverse impact on our
profitability. This could impact us in many ways, including by:

     -    increasing competition;

     -    increasing the expenses we incur to maintain our systems; and/or

     -    increasing the expense of upgrading and/or expanding our systems.


OUR CABLE SYSTEMS ARE OPERATED UNDER FRANCHISES WHICH ARE SUBJECT TO NON-RENEWAL
OR TERMINATION. THE FAILURE TO RENEW A FRANCHISE COULD ADVERSELY AFFECT OUR
BUSINESS IN A KEY MARKET.

         Our cable systems generally operate pursuant to franchises, permits or
licenses typically granted by a municipality or other state or local government
controlling the public rights-of-way. Many franchises establish comprehensive
facilities and service requirements, as well as specific customer service
standards and monetary penalties for non-compliance. In many cases, franchises
are terminable if the franchisee fails to comply with material provisions set
forth in the franchise agreement governing system operations.
<PAGE>   12
Franchises are generally granted for fixed terms and must be periodically
renewed. Local franchising authorities may resist granting a renewal if either
past performance or the prospective operating proposal is considered inadequate.
Franchise authorities often demand concessions or other commitments as a
condition to renewal, which have been and may continue to be costly to us. In
some instances, franchises have not been renewed at expiration, and we have
operated under either temporary operating agreements or without a license while
negotiating renewal terms with the local franchising authorities.

         We cannot assure you that we will be able to comply with all material
provisions of our franchise agreements or that we will be able to renew our
franchises in the future. A termination of and/or a sustained failure to renew a
franchise could adversely affect our business in the affected geographic area.


WE OPERATE OUR CABLE SYSTEMS UNDER FRANCHISES WHICH ARE NON-EXCLUSIVE. LOCAL
FRANCHISING AUTHORITIES CAN GRANT ADDITIONAL FRANCHISES AND CREATE COMPETITION
IN MARKET AREAS WHERE NONE EXISTED PREVIOUSLY.

         Our cable systems are operated under franchises granted by local
franchising authorities. These franchises are non-exclusive. Consequently, such
local franchising authorities can grant additional franchises to competitors in
the same geographic area. As a result, competing operators may build systems in
areas in which we hold franchises. In some cases municipal utilities may legally
compete with us without obtaining a franchise from the local franchising
authority. The existence of more than one cable system operating in the same
territory is referred to as an overbuild. These overbuilds could adversely
affect our growth, financial condition and results of operations by increasing
competition or creating competition where none existed previously. As of
December 31, 2000, we are aware of overbuild situations impacting 139,000 of our
basic customers or approximately 2% of our total basic customers and potential
overbuild situations in areas servicing another 253,000 basic customers or 4% of
our total basic customers, together representing a total of 392,000 customers.
Additional overbuild situations may occur in other systems.

LOCAL FRANCHISE AUTHORITIES HAVE THE ABILITY TO IMPOSE ADDITIONAL REGULATORY
CONSTRAINTS ON OUR BUSINESS. THIS COULD FURTHER INCREASE OUR EXPENSES.

         In addition to the franchise document, cable authorities in some
jurisdictions have adopted cable regulatory ordinances that further regulate the
operation of cable systems. This additional regulation increases our expenses in
operating our business. We cannot assure you that the local franchising
authorities will not impose new and more restrictive requirements.

         Local franchising authorities also have the power to reduce rates and
order refunds of basic service tier rates paid in the previous twelve-month
period determined to be in excess of the maximum permitted rates. Basic service
tier rates are the prices charged for basic programming services. As of December
31, 2000, we have refunded a total of approximately $1.2 million since our
inception. We may be required to refund additional amounts in the future.


DESPITE RECENT DEREGULATION OF EXPANDED BASIC CABLE PROGRAMMING PACKAGES, WE ARE
CONCERNED THAT CABLE RATE INCREASES COULD GIVE RISE TO FURTHER REGULATION. THIS
COULD CAUSE US TO DELAY OR CANCEL SERVICE OR PROGRAMMING ENHANCEMENTS OR IMPAIR
OUR ABILITY TO RAISE RATES TO COVER OUR INCREASING COSTS.

         On March 31, 1999, the pricing of expanded basic cable programming
packages was deregulated, permitting cable operators to set their own rates.
This deregulation was not applicable to basic services. However, the Federal
Communications Commission and the United States Congress continue to be
concerned that cable rate increases are exceeding inflation. It is possible that
either the Federal Communications Commission or the United States Congress will
again restrict the ability of cable system
<PAGE>   13
operators to implement rate increases. Should this occur, it would impede our
ability to raise our rates. If we are unable to raise our rates in response to
increasing costs, our financial condition and results of operations could be
materially adversely affected.

IF WE OFFER TELECOMMUNICATIONS SERVICES, WE MAY BE SUBJECT TO ADDITIONAL
REGULATORY BURDENS CAUSING US TO INCUR ADDITIONAL COSTS.

         If we enter the business of offering telecommunications services, we
may be required to obtain federal, state and local licenses or other
authorizations to offer these services. We may not be able to obtain such
authorizations in a timely manner, or at all, and conditions could be imposed
upon such licenses or authorizations that may not be favorable to us.
Furthermore, telecommunications companies, including Internet protocol telephony
companies, generally are subject to significant regulation as well as higher
fees for pole attachments. Internet protocol telephony companies are companies
that have the ability to offer telephone services over the Internet. Pole
attachments are cable wires that are attached to poles.

         In particular, cable operators who provide telecommunications services
and cannot reach agreement with local utilities over pole attachment rates in
states that do not regulate pole attachment rates will be subject to a rate
methodology prescribed by the Federal Communications Commission. These rates may
be higher than those paid by cable operators who do not provide
telecommunications services. The rate increases are to be phased in over a
five-year period beginning on February 8, 2001. If we become subject to
telecommunications regulation or higher pole attachment rates, we may incur
additional costs which may be material to our business. A recent court decision,
currently under appeal to the United States Supreme Court, suggests that the
provision of Internet service may subject cable systems to substantially higher
pole attachment rates, and certain utilities have already proposed vastly higher
pole attachment rates based in part on the existing court decision.