8-KEarnings & ResultsMaterial AgreementsOther Events+1

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Material Agreement (Feb 13, 2009)

Filed February 13, 2009For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) announced on February 13, 2009, that it has reached an agreement in principle with holders of approximately $4.1 billion in aggregate principal amount of its subsidiaries' senior notes to restructure its capital. The company and its subsidiaries expect to file for Chapter 11 bankruptcy protection on or before April 1, 2009, to implement this restructuring plan aimed at improving its financial structure. The restructuring involves a multi-faceted approach, including a debt exchange for existing senior notes, new debt issuances, and an equity rights offering backstopped by certain noteholders. This plan aims to address significant debt obligations, with common stockholders expected to receive no value, as their shares will be cancelled. The company also addressed recent interest payment defaults and a dispute with its credit facility agent regarding potential events of default.

Key Highlights

  • 1Agreement in principle reached with holders of approximately $4.1 billion in senior notes.
  • 2Charter Communications and its subsidiaries intend to file for Chapter 11 bankruptcy protection by April 1, 2009.
  • 3The restructuring plan includes a debt exchange, new debt issuance, and an equity rights offering.
  • 4Common stockholders are expected to have their shares cancelled and receive no value.
  • 5Charter has paid overdue interest on certain notes, resolving a potential default under those indentures.
  • 6The company is in a dispute with its credit facility administrative agent regarding alleged events of default.
  • 7The restructuring is contingent on various conditions, including court approvals and adherence to deadlines.

Frequently Asked Questions

Charter Communications is filing for Chapter 11 bankruptcy protection to implement a comprehensive restructuring plan aimed at significantly improving its capital structure and addressing its substantial debt obligations.

The current common stockholders are expected to have their shares cancelled as part of the restructuring plan and will not receive any value for their holdings.

The restructuring is expected to be funded through a combination of cash from operations, an exchange of existing debt for new debt, new debt commitments from noteholders, and the proceeds from an equity rights offering which has a backstop commitment from certain noteholders.

Charter has reached an agreement in principle with key noteholders for a debt restructuring. The company has also paid overdue interest on certain notes. However, it is engaged in a dispute with its credit facility administrative agent concerning alleged events of default, which has impacted its ability to draw on its credit line.