8-KMaterial AgreementsFinancial EventsExhibits & Filings

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Material Agreement (Oct 5, 2007)

Filed October 5, 2007For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) has filed an 8-K report on October 5, 2007, detailing a significant debt exchange transaction that closed on October 2, 2007. The company, through its subsidiary Charter Communications Holding Company, LLC, successfully exchanged $364 million of its existing 5.875% Convertible Senior Notes due 2009 for $479 million of new 6.50% Convertible Senior Notes due 2027. This exchange effectively extends the maturity of a portion of Charter's convertible debt by 18 years and increases the principal amount by $115 million. The new notes carry a higher interest rate of 6.50% compared to the existing 5.875% and offer investors repurchase options at specified intervals, beginning in 2012. This move indicates a strategic effort by Charter to manage its debt profile, pushing out maturity dates and potentially accessing capital under new terms.

Key Highlights

  • 1Charter Communications completed an exchange offer for its convertible senior notes on October 2, 2007.
  • 2Existing 5.875% Convertible Senior Notes due 2009 ($364 million principal) were exchanged for new 6.50% Convertible Senior Notes due 2027 ($479 million principal).
  • 3The exchange effectively extends the maturity of a significant portion of Charter's convertible debt to 2027.
  • 4The new notes carry a higher coupon rate of 6.50% compared to the previous 5.875%.
  • 5The transaction involved Charter's subsidiary, Charter Communications Holding Company, LLC.
  • 6New convertible notes are unsecured and unsubordinated obligations of Charter.
  • 7The indenture for the new notes includes provisions for repurchase by Charter at the option of holders on October 1, 2012, 2017, and 2022.

Frequently Asked Questions

The primary purpose of this filing is to report the entry into a material definitive agreement, specifically the closing of an offer by Charter Communications to exchange its outstanding 5.875% Convertible Senior Notes due 2009 for new 6.50% Convertible Senior Notes due 2027.

The new notes mature on October 1, 2027, bear interest at 6.50% per annum, payable semi-annually. They have an initial conversion price of $3.41, and investors have the option to require Charter to repurchase the notes for cash on October 1, 2012, 2017, and 2022, at a price equal to the principal amount plus accrued interest.

This exchange extends the maturity of a significant portion of Charter's convertible debt from 2009 to 2027. It also increases the principal amount of convertible debt outstanding by $115 million ($479 million issued vs. $364 million exchanged) and raises the coupon rate from 5.875% to 6.50%.

Yes, the filing also references an Amended and Restated Share Lending Agreement with Citigroup Global Markets Limited, and agreements related to a 'Mirror Note' and an Amended and Restated Unit Lending Agreement with Charter Communications Holding Company, LLC. These appear to be related to the mechanics of the convertible note issuance and compliance requirements.