Debt and Capital Lease Obligations

The U.S. dollar equivalents of the components of our consolidated debt and capital lease obligations are as follows:



	March 31, 2014										Carrying value (d)
	Weighted average interest rate (a)		Unused borrowing capacity (b)				Estimated fair value (c)				Carrying value (d)
	Weighted average interest rate (a)		Borrowing currency		U.S. $ equivalent		March 31, 2014		December 31, 2013		March 31, 2014			December 31, 2013
			in millions
Debt:
VM Notes	6.26	%	—		$	—	$	10,926.8	$	9,188.7	$	10,692.6		$	9,150.1
VM Credit Facility	3.77	%	£	660.0	1,100.9		4,390.2		4,388.9		4,364.5			4,352.8
VM Convertible Notes (e)	6.50	%	—		—		157.5		164.1		57.4			57.5
UPCB SPE Notes	6.88	%	—		—		4,564.1		4,536.5		4,217.6			4,219.5
UPC Broadband Holding Bank Facility	3.71	%	€	1,046.2	1,440.8		3,479.8		5,717.8		3,438.0			5,671.4
UPC Holding Senior Notes (f)	7.51	%	—		—		3,402.2		3,297.4		3,099.3			3,099.2
Unitymedia KabelBW Notes	6.89	%	—		—		8,289.7		8,058.2		7,644.4			7,651.9
Unitymedia KabelBW Revolving Credit Facilities	3.33	%	€	417.5	575.0		—		—		—			—
Telenet SPE Notes	5.94	%	—		—		2,959.5		2,916.5		2,755.7			2,759.2
Telenet Credit Facility	3.72	%	€	158.0	217.6		1,945.4		1,956.9		1,934.6			1,936.9
VTR Finance Senior Secured Notes	6.88	%	—		—		1,456.0		—		1,400.0			—
Sumitomo Collar Loan	1.88	%	—		—		957.5		939.3		913.2			894.3
Ziggo Collar Loan	0.45	%	—		—		682.3		852.9		682.1			852.6
Liberty Puerto Rico Bank Facility	6.89	%	$	21.0	21.0		660.5		666.2		657.6			665.0
Ziggo Margin Loan (g)	—		—		—		—		634.3		—			634.3
Vendor financing (h)	3.74	%	—		—		575.8		603.1		575.8			603.1
Other (i)	8.91	%	(j)		200.0		196.9		308.2		196.9			308.2
Total debt	5.75	%			$	3,555.3	$	44,644.2	$	44,229.0	42,629.7			42,856.0

Capital lease obligations:
Unitymedia KabelBW											943.9			952.0
Telenet											462.9			451.2
Virgin Media											360.2			373.5
Other subsidiaries											74.9			71.6
Total capital lease obligations											1,841.9			1,848.3
Total debt and capital lease obligations											44,471.6			44,704.3
Current maturities											(3,470.8		)	(1,023.4		)
Long-term debt and capital lease obligations											$	41,000.8		$	43,680.9

_______________

(a)

Represents the weighted average interest rate in effect at March 31, 2014 for all borrowings outstanding pursuant to each debt instrument including any applicable margin. The interest rates presented represent stated rates and do not include the impact of our interest rate derivative contracts, deferred financing costs, original issue premiums or discounts or commitment fees, all of which affect our overall cost of borrowing. Including the effects of derivative instruments, original issue premiums and discounts and commitment fees, but excluding the impact of financing costs, our weighted average interest rate on our aggregate variable- and fixed-rate indebtedness was 6.8% at March 31, 2014. For information concerning our derivative instruments, see note 4.

(b)

Unused borrowing capacity represents the maximum availability under the applicable facility at March 31, 2014 without regard to covenant compliance calculations or other conditions precedent to borrowing. At March 31, 2014, the full amount of unused borrowing capacity was available to be borrowed under each of the respective subsidiary facilities based on the applicable leverage and other financial covenants, except as noted below. At March 31, 2014, (i) our availability under the UPC Broadband Holding Bank Facility (as defined and described below) was limited to €776.0 million ($1,068.7 million) and (ii) none of the unused borrowing capacity under Virgin Media’s £660.0 million ($1,100.9 million) senior secured revolving credit facility (the VM Credit Facility) was available to be borrowed. When the relevant March 31, 2014 compliance reporting requirements have been completed and assuming no changes from March 31, 2014 borrowing levels, we anticipate that our availability under the UPC Broadband Holding Bank Facility will be limited to €744.3 million ($1,025.1 million) and all of the unused borrowing capacity under the VM Credit Facility will continue to be unavailable. In addition to the limitations noted above, the debt instruments of our subsidiaries contain restricted payment tests that limit the amount that can be loaned or distributed to other Liberty Global subsidiaries and ultimately to Liberty Global. At March 31, 2014, these restrictions did not impact our ability to access the liquidity of our subsidiaries to satisfy our corporate liquidity needs beyond what is described above, except that the availability to be loaned or distributed by Unitymedia KabelBW was limited to €367.4 million ($506.0 million) and none of the liquidity of Virgin Media or Liberty Puerto Rico was available to be loaned or distributed. When the relevant March 31, 2014 compliance reporting requirements have been completed and assuming no changes from March 31, 2014 borrowing levels, we anticipate that the availability to be loaned or distributed by Unitymedia KabelBW will be unlimited and that all of the liquidity of Virgin Media or Liberty Puerto Rico will continue to be unavailable to be loaned or distributed. Upon completion of the relevant March 31, 2014 compliance reporting requirements and the April 2014 redemption of the 2018 VM Sterling Senior Secured Notes (as defined and described below), and assuming no other changes from March 31, 2014 borrowing levels, we anticipate that £655.7 million ($1,093.7 million) of unused borrowing capacity under the VM Credit Facility will be available to be borrowed and that £159.5 million ($266.1 million) of this amount will be available to be loaned or distributed. For information concerning transactions completed subsequent to March 31, 2014 that could have an impact on unused borrowing capacity, see below and note 15.

(c)

The estimated fair values of our debt instruments were determined using the average of applicable bid and ask prices (mostly Level 1 of the fair value hierarchy) or, when quoted market prices are unavailable or not considered indicative of fair value, discounted cash flow models (mostly Level 2 of the fair value hierarchy). The discount rates used in the cash flow models are based on the market interest rates and estimated credit spreads of the applicable entity, to the extent available, and other relevant factors. For additional information concerning fair value hierarchies, see note 5.


(d)	Amounts include the impact of premiums and discounts, where applicable.

(e)

The 6.50% convertible senior notes issued by Virgin Media (the VM Convertible Notes) are exchangeable under certain conditions for (subject to further adjustment as provided in the underlying indenture and subject to Virgin Media’s right to settle in cash or a combination of Liberty Global ordinary shares and cash) 13.4339 of our Class A ordinary shares, 33.4963 of our Class C ordinary shares and $910.51 in cash (without interest) for each $1,000 in principal amount of VM Convertible Notes exchanged. The amount reported in the estimated fair value column for the VM Convertible Notes represents the estimated fair value of the remaining VM Convertible Notes outstanding as of March 31, 2014, including both the debt and equity components.


(f)	During April 2014, we used existing cash to repay in full UPC Holding’s $400.0 million principal amount of 9.875% senior notes due 2018 (the UPC Holding 9.875% Senior Notes).

(g)

During the first quarter of 2014, we used existing cash to repay the full amount of the limited recourse margin loan (the Ziggo Margin Loan) that was secured by a portion of our investment in Ziggo. In connection with this transaction, we recognized a loss on debt modification and extinguishment of $2.3 million related to the write-off of deferred financing costs. For information regarding our investment in Ziggo, see note 3.

(h)

Represents amounts owed pursuant to interest-bearing vendor financing arrangements that are generally due within one year. At March 31, 2014 and December 31, 2013, the amounts owed pursuant to these arrangements include $49.3 million and $47.3 million, respectively, of VAT that was paid on our behalf by the vendor. Repayments of vendor financing obligations are included in repayments and repurchases of debt and capital lease obligations in our condensed consolidated statements of cash flows.

(i)

The December 31, 2013 amounts include outstanding borrowings of $113.1 million under VTR Wireless’s then-existing CLP 60.0 billion ($109.2 million) term loan bank facility (the VTR Wireless Bank Facility). In January 2014, all outstanding amounts under the VTR Wireless Bank Facility were repaid and the VTR Wireless Bank Facility was cancelled. In connection with this transaction, we recognized a loss on debt modification and extinguishment of $2.0 million related to the write-off of deferred financing costs.

(j)

Unused borrowing capacity relates to the senior secured revolving credit facility of entities within the VTR Group, which includes a $160.0 million U.S. dollar facility (the VTR Dollar Senior Credit Facility) and a CLP 22.0 billion ($40.0 million) Chilean peso facility (the VTR CLP Senior Credit Facility), each of which were undrawn at March 31, 2014. The VTR Dollar Senior Credit Facility and the VTR CLP Senior Credit Facility have commitment fees on unused and uncancelled balances of 1.1% and 1.34% per year, respectively.

VM Notes

On March 14, 2014, Virgin Media Secured Finance PLC (Virgin Media Secured Finance), a wholly-owned subsidiary of Virgin Media, issued (i) $425.0 million principal amount of 5.5% senior secured notes due January 15, 2025 (the 2025 VM Dollar Senior Secured Notes), (ii) £430.0 million ($717.3 million) principal amount of 5.5% senior secured notes due January 15, 2025 (the 2025 VM Sterling Senior Secured Notes and, together with the 2025 VM Dollar Senior Secured Notes, the 2025 VM Senior Secured Notes) and (iii) £225.0 million ($375.3 million) principal amount of 6.25% senior secured notes due March 28, 2029 (the Original 2029 VM Senior Secured Notes). In April 2014, the net proceeds from the 2025 VM Senior Secured Notes and the Original 2029 VM Senior Secured Notes were used to redeem all of the £875.0 million ($1,459.5 million) principal amount of 7.0% senior secured notes due 2018 (the 2018 VM Sterling Senior Secured Notes), including the related redemption premium. Accordingly, the carrying value of the 2018 VM Sterling Senior Secured Notes has been reclassified to current portion of debt and capital lease obligations in our March 31, 2014 condensed consolidated balance sheet.

On April 1, 2014, Virgin Media Secured Finance issued £175.0 million ($291.9 million) principal amount of 6.25% senior secured notes due March 28, 2029 (the Additional 2029 VM Senior Secured Notes and, together with the Original 2029 VM Senior Secured Notes, the 2029 VM Senior Secured Notes) at an issue price of 101.75%. On May 22, 2014, the net proceeds from the Additional 2029 VM Senior Secured Notes, along with borrowings under VM Facility D and VM Facility E (each as defined and described in note 15) will be used to fully redeem the $1.0 billion principal amount of 6.5% senior secured notes due 2018 (2018 VM Dollar Senior Secured Notes), including the related redemption premium.

The 2025 VM Senior Secured Notes and 2029 VM Senior Secured Notes are senior obligations of Virgin Media Secured Finance that rank equally with all of the existing and future senior debt of Virgin Media Secured Finance and are senior to all existing and future subordinated debt of Virgin Media Secured Finance. The 2025 VM Senior Secured Notes and 2029 VM Senior Secured Notes are guaranteed on a senior basis by Virgin Media and certain subsidiaries of Virgin Media (the VM Senior Secured Guarantors) and are secured by liens on substantially all of the assets of Virgin Media Secured Finance and the VM Senior Secured Guarantors (except for Virgin Media).

The 2025 VM Senior Secured Notes and 2029 VM Senior Secured Notes contain certain customary incurrence-based covenants. For example, the ability to raise certain additional debt and make certain distributions or loans to other subsidiaries of Liberty Global is subject to a Consolidated Leverage Ratio test, as defined in the applicable indenture. In addition, the 2025 VM Senior Secured Notes and 2029 VM Senior Secured Notes provide that any failure to pay principal prior to expiration of any applicable grace period, or any acceleration with respect to other indebtedness of £50.0 million ($83.4 million) or more in the aggregate of Virgin Media, Virgin Media Finance PLC, Virgin Media Secured Finance or VMIH (as applicable under the relevant indenture), or the Restricted Subsidiaries (as defined in the applicable indenture) is an event of default under the 2025 VM Senior Secured Notes and 2029 VM Senior Secured Notes.

Subject to the circumstances described below, the 2025 VM Senior Secured Notes are non-callable until January 15, 2019 and the 2029 VM Senior Secured Notes are non-callable until January 15, 2021. At any time prior to January 15, 2019, in the case of the 2025 VM Senior Secured Notes, or January 15, 2021, in the case of the 2029 VM Senior Secured Notes, Virgin Media Secured Finance may redeem some or all of the 2025 VM Senior Secured Notes or the 2029 VM Senior Secured Notes (as applicable) by paying a “make-whole” premium, which is the present value of all remaining scheduled interest payments to January 15, 2019 or January 15, 2021 (as applicable) using the discount rate (as specified in the applicable indenture) as of the redemption date plus 50 basis points.

Virgin Media Secured Finance may redeem some or all of the 2025 VM Senior Secured Notes or the 2029 VM Senior Secured Notes at the following redemption prices (expressed as a percentage of the principal amount) plus accrued and unpaid interest and Additional Amounts (as defined in the applicable indenture), if any, to the applicable redemption date, if redeemed during the twelve-month period commencing on January 15 of the years set forth below:



	Redemption price
Year	2025 VM Senior Secured Notes	2029 VM Senior Secured Notes

2019	102.750%	N.A.
2020	101.833%	N.A.
2021	100.000%	103.125%
2022	100.000%	102.083%
2023	100.000%	101.042%
2024 and thereafter	100.000%	100.000%

UPC Broadband Holding Bank Facility

The UPC Broadband Holding Bank Facility, as amended, is the senior secured credit facility of UPC Broadband Holding. The details of our borrowings under the UPC Broadband Holding Bank Facility as of March 31, 2014 are summarized in the following table:



Facility	Final maturity date	Interest rate	Facility amount (in borrowing currency) (a)		Unused borrowing capacity (b)		Carrying value (c)
			in millions

Q	July 31, 2014	EURIBOR + 2.75%	€	30.0	$	41.3	$	—
V (d)	January 15, 2020	7.625%	€	500.0	—		688.6
Y (d)	July 1, 2020	6.375%	€	750.0	—		1,032.9
Z (d)	July 1, 2020	6.625%	$	1,000.0	—		1,000.0
AC (d)	November 15, 2021	7.250%	$	750.0	—		750.0
AD (d)	January 15, 2022	6.875%	$	750.0	—		750.0
AG	March 31, 2021	EURIBOR + 3.75%	€	1,554.4	—		2,136.3
AH	June 30, 2021	LIBOR + 2.50% (e)	$	1,305.0	—		1,301.7
AI	April 30, 2019	EURIBOR + 3.25%	€	1,016.2	1,399.5		—
Elimination of Facilities V, Y, Z, AC and AD in consolidation (d)					—		(4,221.5		)
Total					$	1,440.8	$	3,438.0

_______________


(a)	Except as described in (d) below, amounts represent total third-party facility amounts at March 31, 2014 without giving effect to the impact of discounts.

(b)

At March 31, 2014, our availability under the UPC Broadband Holding Bank Facility was limited to €776.0 million ($1,068.7 million). When the relevant March 31, 2014 compliance reporting requirements have been completed, we anticipate that our availability under the UPC Broadband Holding Bank Facility will be limited to €744.3 million ($1,025.1 million). Facilities Q and AI have commitment fees on unused and uncancelled balances of 0.75% and 1.3% per year, respectively.


(c)	The carrying values of Facilities AG and AH include the impact of discounts.

(d)

Amounts related to certain senior secured notes (the UPCB SPE Notes) issued by special purpose financing entities (the UPCB SPEs) that are consolidated by UPC Holding and Liberty Global. The proceeds from the UPCB SPE Notes were used to fund additional Facilities V, Y, Z, AC and AD, with our wholly-owned subsidiary UPC Financing Partnership as the borrower. Accordingly, the amounts outstanding under Facilities V, Y, Z, AC and AD are eliminated in our condensed consolidated financial statements.


(e)	Facility AH has a LIBOR floor of 0.75%.

In January 2014, VTR Finance B.V. (VTR Finance), our wholly-owned subsidiary, issued $1.4 billion principal amount of 6.875% senior secured notes due January 15, 2024 (the VTR Finance Senior Secured Notes) in connection with the extraction of VTR GlobalCom and certain of its parents and all of its subsidiaries from the UPC Holding credit pool. The net proceeds from the VTR Finance Senior Secured Notes, together with cash from another subsidiary of Liberty Global, were loaned to UPC Broadband Holding and used to repay all of the outstanding indebtedness under Facilities R, S and AE. In connection with this transaction, we recognized a loss on debt modification and extinguishment of $7.2 million related to the write-off of deferred financing costs.

During the first quarter of 2014, we used existing cash to repay all of the outstanding borrowings under Facility AF. In connection with this transaction, we recognized a loss on debt modification and extinguishment of $9.3 million, including (i) a $4.9 million write-off of an unamortized discount and (ii) a $4.4 million write-off of deferred financing costs.

Ziggo Bridge Facility

On January 27, 2014, LGE HoldCo VI B.V., our wholly-owned subsidiary, entered into a bridge facility agreement (the Ziggo Bridge Facility). The Ziggo Bridge Facility, which was never drawn, was cancelled on February 17, 2014.

Maturities of Debt and Capital Lease Obligations

Maturities of our debt and capital lease obligations as of March 31, 2014 are presented below for the named entity and its subsidiaries, unless otherwise noted. Amounts presented below represent U.S. dollar equivalents based on March 31, 2014 exchange rates:

Debt:



	Virgin Media (a)		UPC Holding (b)			Unitymedia KabelBW			Telenet (c)		Other (d)			Total
	in millions
Year ending December 31:
2014 (remainder of year)	$	1,533.5	$	738.9		$	45.8		$	10.2	$	731.2		$	3,059.6
2015	—		100.4			31.0			10.2		9.8			151.4
2016	—		—			—			147.9		375.9			523.8
2017	—		—			—			603.8		860.2			1,464.0
2018	1,000.0		—			—			251.2		339.3			1,590.5
2019	1,555.5		—			2,387.6			1,123.2		—			5,066.3
Thereafter	10,838.5		10,390.9			5,259.8			2,722.7		1,400.0			30,611.9
Total debt maturities	14,927.5		11,230.2			7,724.2			4,869.2		3,716.4			42,467.5
Unamortized premium (discount)	206.1		(36.0		)	(3.0		)	1.2		(6.1		)	162.2
Total debt	$	15,133.6	$	11,194.2		$	7,721.2		$	4,870.4	$	3,710.3		$	42,629.7
Current portion	$	1,598.3	$	821.8		$	76.8		$	10.2	$	728.8		$	3,235.9
Noncurrent portion	$	13,535.3	$	10,372.4		$	7,644.4		$	4,860.2	$	2,981.5		$	39,393.8

_______________


(a)	The current portion includes the $1,459.5 million (equivalent) principal amount of the 2018 VM Sterling Senior Secured Notes. In April 2014, the net proceeds from the 2025 VM Senior Secured Notes and the Original 2029 VM Senior Secured Notes were used to redeem all of the 2018 VM Sterling Senior Secured Notes, as further described above.


(b)	Amounts include the UPCB SPE Notes issued by the UPCB SPEs. As described above, the UPCB SPEs are consolidated by UPC Holding. In addition, the current portion includes the $400.0 million principal amount of the UPC Holding 9.875% Senior Notes that were repaid in full in April 2014.


(c)	Amounts include certain senior secured notes issued by special purpose financing entities that are consolidated by Telenet.


(d)	The current portion includes the $689.1 million (equivalent) principal amount outstanding under the Ziggo Collar Loan, which we expect to settle on or before the closing of the acquisition of Ziggo. The Ziggo Collar Loan may be settled with cash, shares or a combination thereof. For information regarding our pending acquisition of Ziggo, see note 2.

Capital lease obligations:



	Unitymedia KabelBW			Telenet			Virgin Media			Other			Total
	in millions
Year ending December 31:
2014 (remainder of year)	$	75.9		$	59.9		$	123.5		$	19.4		$	278.7
2015	101.0			70.0			120.2			17.5			308.7
2016	101.0			68.8			67.8			17.7			255.3
2017	101.0			67.0			25.5			10.1			203.6
2018	101.0			63.3			5.0			4.4			173.7
2019	101.0			51.5			4.7			3.1			160.3
Thereafter	1,099.3			247.9			238.0			24.5			1,609.7
Total principal and interest payments	1,680.2			628.4			584.7			96.7			2,990.0
Amounts representing interest	(736.3		)	(165.5		)	(224.5		)	(21.8		)	(1,148.1		)
Present value of net minimum lease payments	$	943.9		$	462.9		$	360.2		$	74.9		$	1,841.9
Current portion	$	29.3		$	45.5		$	143.9		$	16.2		$	234.9
Noncurrent portion	$	914.6		$	417.4		$	216.3		$	58.7		$	1,607.0

Non-cash Refinancing Transactions

During the three months ended March 31, 2014 and 2013, certain of our refinancing transactions included non-cash borrowings and repayments of debt aggregating $1,375.5 million and $550.4 million, respectively.

Subsequent Events

For information concerning certain financing transactions completed subsequent to March 31, 2014, see note 15.