8-KLeadership ChangesMaterial AgreementsSecurities & Listing+1

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Material Agreement (Apr 19, 2005)

Filed April 19, 2005For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) filed an 8-K on April 19, 2005, reporting on several key events that occurred on or around April 15, 2005. The most significant information for investors revolves around changes in key financial leadership and a potential delisting notice from Nasdaq. Paul E. Martin's role as Interim Chief Financial Officer was formalized with a new agreement detailing his compensation, which includes a base salary and a performance-based bonus, in addition to his existing roles. This appointment follows the departure of Derek Chang, who resigned as Executive Vice President of Finance and Strategy and Interim co-Chief Financial Officer. Furthermore, the company disclosed that it received a noncompliance notice from Nasdaq regarding its Audit Committee composition. The resignation of an independent Audit Committee member has left the committee with fewer than the required three independent members. Charter has until its next annual shareholder meeting, expected in July 2005, to appoint a new independent member and regain compliance to avoid delisting. Investors should monitor the company's progress in resolving this Nasdaq issue and the ongoing search for a permanent CFO.

Key Highlights

  • 1Formalized agreement for Paul E. Martin as Interim Chief Financial Officer, outlining monthly compensation of approximately $13,700 plus bonus potential.
  • 2Mr. Martin will also receive a $50,000 special bonus for his prior service as Interim co-Chief Financial Officer.
  • 3Derek Chang resigned as Executive Vice President of Finance and Strategy and Interim co-Chief Financial Officer, with his resignation effective April 15, 2005.
  • 4Charter Communications received a notice from Nasdaq for noncompliance with its Audit Committee independence requirements.
  • 5The company has until its next annual shareholder meeting (expected July 2005) to regain compliance and avoid delisting.
  • 6Charter intends to appoint a new independent Audit Committee member to resolve the Nasdaq compliance issue.

Frequently Asked Questions

Derek Chang has resigned from his roles as Executive Vice President of Finance and Strategy and Interim co-Chief Financial Officer, effective April 15, 2005. Paul E. Martin, who was also serving as Interim co-Chief Financial Officer, will continue in the capacity of Interim Chief Financial Officer under a new agreement detailing his compensation. He also holds his permanent positions as Senior Vice President, Principal Accounting Officer, and Controller.

Charter Communications received a notice from Nasdaq indicating noncompliance with Marketplace Rule 4350(d)(2)(A) because its Audit Committee no longer has the required minimum of three independent members following the resignation of an independent director. Noncompliance could lead to the delisting of Charter's securities from Nasdaq, which would significantly impact liquidity and investor confidence.

The company has stated its intention to regain compliance by appointing a new Audit Committee member who meets Nasdaq's independence requirements within the specified timeframe, which is until the date of its next annual shareholder meeting, expected in July 2005.

Under the new agreement, Mr. Martin will receive approximately $13,700 per month for his service as Interim Chief Financial Officer, in addition to his salary for his permanent roles. He is also eligible for a monthly bonus of up to approximately $13,600, payable under the Company's 2005 Executive Bonus Plan. Additionally, he will receive a special one-time bonus of $50,000 for his prior service as Interim co-Chief Financial Officer.