AFFILIATE AND RELATED PARTY TRANSACTIONS

Equity Method Investments

In April 2018, Altice N.V. transferred its ownership of i24 US and i24 Europe ('i24NEWS"), Altice N.V.'s 24/7 international news and current affairs channels to the Company for minimal consideration (the "i24NEWS Acquisition"). As the acquisition was a combination of businesses under common control, the Company combined the results of operations and related assets and liabilities of i24NEWS as of April 1, 2018. Operating results for periods prior to April 1, 2018 and the balance sheet as of December 31, 2017 have not been revised to reflect the combination of i24NEWS as the impact was deemed immaterial.

The Company's equity in the net losses of i24NEWS prior to April 1, 2018 of $1,130 for the six months ended June 30, 2018 and $1,338 and $2,585 for three and six months ended June 30, 2017 were recorded using the equity method and reflected in other expense, net in the Company's statements of operations. The Company's investment in i24NEWS as of December 31, 2017 of $930 is included in investment in affiliates on the Company's condensed consolidated balance sheet.

In April 2018, the Company redeemed a 24% interest in Newsday LLC ("Newsday") and recognized a gain of $13,298, reflected in gain (loss) on investments and sale of affiliate interests, net in the Company's statements of operations. For the three and six months ended June 30, 2018, the Company recorded equity in the net loss of Newsday of $407 and $9,719, respectively. For the three and six months ended June 30, 2017, the Company recorded equity in net loss of Newsday of $27 and $1,537, respectively, reflected in other expense, net in the Company's statements of operations. The Company's deficit investment in Newsday as of June 30, 2018 and December 31, 2017 of $0 and $3,579, respectively, is included in deficit investment in affiliates on the Company's condensed consolidated balance sheets.

Affiliate and Related Party Transactions

Altice USA is controlled by Patrick Drahi who is also the controlling stockholder of Altice N.V. and its subsidiaries.

As the transactions discussed below were conducted between entities under common control by Mr. Drahi and equity method investees, amounts charged for certain services may not have represented amounts that might have been received or incurred if the transactions were based upon arm's length negotiations.

The following table summarizes the revenue and charges related to services provided to or received from subsidiaries of Altice N.V. and Newsday:



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
Revenue	$	727		$	253		$	852		$	394
Operating expenses:
Programming and other direct costs	(3,865		)	(1,095		)	(5,019		)	$	(1,830	)
Other operating expenses, net	(6,255		)	(8,666		)	(14,249		)	(15,964		)
Operating expenses, net	(10,120		)	(9,761		)	(19,268		)	(17,794		)

Interest expense (a)	—			(42,817		)	—			(90,405		)
Other expense, net	149			—			149			—
Loss on extinguishment of debt and write-off of deferred financing costs	—			(513,723		)	—			(513,723		)
Net charges	$	(9,244	)	$	(566,048	)	$	(18,267	)	$	(621,528	)
Capital Expenditures	$	1,108		$	8,473		$	2,734		$	9,365


(a)	In connection with the Company's IPO in June 2017, the Company converted the notes payable to affiliates and related parties into shares of the Company’s common stock at the IPO price.

Revenue

The Company recognized revenue primarily in connection with the sale of advertising to Newsday.

Programming and other direct costs

Programming and other direct costs include costs incurred by the Company for the transport and termination of voice and data services provided by a subsidiary of Altice N.V.

Other operating expenses

A subsidiary of Altice N.V. provided certain executive services, as well as consulting, advisory and other services, including, prior to the IPO, CEO, CFO and COO services, to the Company. Compensation under the terms of the agreement was an annual fee of $30,000 to be paid by the Company. Fees associated with this agreement recorded by the Company amounted to approximately $5,750 and $13,250 for the three and six months ended June 30, 2018, respectively and $7,500 and $15,000 for the three and six months ended June 30, 2017, respectively. As of June 20, 2017, the CEO, CFO and COO became employees of the Company and the agreement was assigned to Altice N.V. by a subsidiary of Altice N.V. This agreement was terminated upon the completion of the Distribution discussed in Note 1.

Other operating expenses also include charges for services provided by other subsidiaries of Altice N.V. aggregating $505 and $999 for the three and six months ended June 30, 2018 and $1,166 and $964 for the three and six months ended June 30, 2017, respectively, net of credits of $359 and $841 for the three and six months ended June 30, 2017, for transition services provided to Newsday.

Capital Expenditures

Capital expenditures include $1,108 and $2,734 for the three and six months ended June 30, 2018 and $8,473 and $9,365, for the three and six months ended June 30, 2017, respectively, for equipment purchases and software development services provided by subsidiaries of Altice N.V.

Aggregate amounts that were due from and due to related parties are summarized below:



	June 30, 2018		December 31, 2017
Due from:
Altice US Finance S.A. (a)	$	13,100	$	12,951
Newsday (b)	2,581		2,713
Altice Management Americas (b)	1,271		33
i24 News (b)	—		4,036
Other Altice N.V. subsidiaries (b)	660		31
	$	17,612	$	19,764
Due to:
Altice N.V. (c)	13,250		—
Newsday (b)	42		33
Altice Labs S.A. (d)	1,899		7,354
Other Altice N.V. subsidiaries (d)	9,201		3,611
	$	24,392	$	10,998


(a)	Represents interest on senior notes paid by the Company on behalf of the affiliate.


(b)	Represents amounts paid by the Company on behalf of the respective related party and for Newsday, the net amounts due from the related party also include charges for certain transition services provided.


(c)	Represents amounts due to Altice N.V. pursuant to the agreement discussed above.


(d)	Represents amounts due to affiliates for the purchase of equipment and advertising services, as well as reimbursement for payments made on our behalf.