Falcon Holding Group L.P. said in a regulatory filing that the recent Federal Communications Commission decision to roll back cable rates an additional 7% will force the cabler to negotiate “significant amendments” to its bank credit agreement and 11% senior subordinated notes.
The ruling will most likely “materially and adversely” affect Falcon’s future revenues and cash flow, which could result in defaults under the covenants in Falcon’s debt agreements.
In its filing, Falcon also said the uncertainty surrounding the FCC ruling led it to suspend the majority of its plant rebuilds and upgrades until it can assess the decision’s impact on its ability to raise capital.
The ruling already has forced Falcon to delay its initial public offering.
Falcon officials could not be reached late Wednesday.