8-KOther EventsExhibits & Filings

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Corporate Update (Jan 4, 2010)

Filed January 4, 2010For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) filed an 8-K on January 4, 2010, detailing an exchange of membership units in its subsidiary, Charter Communications Holding Company, LLC (Holdco). On December 28, 2009, Charter Investment, Inc. (CII), an entity affiliated with Paul G. Allen, exchanged 81% of its Holdco Unit for approximately 907,698 shares of CHTR's Class A common stock and $1,000 cash. This transaction resulted in Charter Communications, Inc. holding 99.81% of Holdco units, with CII retaining a small fraction. Additionally, the filing announced that the Board of Directors approved a cash dividend payment for the Series A 15% Pay-In-Kind Preferred Stock, scheduled for January 15, 2010, to shareholders of record as of January 4, 2010. This dividend payout is a significant event for preferred shareholders, indicating a move towards cash distribution.

Key Highlights

  • 1CII exchanged 81% of its Holdco Unit for 907,698 shares of CHTR Class A common stock and $1,000 cash on December 28, 2009.
  • 2Following the exchange, Charter Communications, Inc. holds 99.81% of Holdco units, with CII holding the remaining 0.19%.
  • 3CII retains the right to exchange its remaining 0.19 Holdco Unit for an additional 212,923 CHTR Class A shares by November 30, 2014.
  • 4The company's Class A common stock issuance is a taxable transaction for the exchanging party.
  • 5Charter Communications' Board approved a cash dividend payment for its Series A 15% Pay-In-Kind Preferred Stock.
  • 6The preferred stock dividend will be paid in cash on January 15, 2010, to shareholders of record on January 4, 2010.

Frequently Asked Questions

The primary event reported is the exchange of membership units in Charter Communications Holding Company, LLC (Holdco) by Charter Investment, Inc. (CII) for shares of Charter Communications, Inc. (CHTR) Class A common stock and cash.

CII is an entity affiliated with Paul G. Allen, and they hold rights and options related to Holdco units, including the right to exchange them for CHTR stock and cash.

The exchange of 81% of CII's Holdco Unit resulted in the issuance of 907,698 shares of Class A common stock. CII also has the option to exchange its remaining unit for an additional 212,923 shares by November 30, 2014, which would further increase the outstanding share count.

The announcement signifies that the company's Board of Directors has approved a cash payment for the Series A 15% Pay-In-Kind Preferred Stock. This is important for preferred shareholders as it indicates a distribution of value, and the payment is scheduled for January 15, 2010.