8-KMaterial AgreementsFinancial EventsExhibits & Filings

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Material Agreement (Jun 22, 2010)

Filed June 22, 2010For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) filed an 8-K on June 22, 2010, reporting on a material definitive agreement and a direct financial obligation. Specifically, on June 18, 2010, the Company unconditionally guaranteed approximately $1.8 billion of 13.50% Senior Notes due 2016, issued by its indirect subsidiaries CCH II, LLC and CCH II Capital Corp. This guarantee is on a senior unsecured basis and covers principal, premium, and interest payments, as well as other obligations under the Notes. This filing is significant for investors as it clarifies Charter's financial commitments and strengthens the credit standing of the issued notes by providing the company's direct guarantee. The high interest rate (13.50%) on the 2016 Senior Notes suggests these were likely issued during a period of higher borrowing costs or reflect the company's specific credit risk profile at that time. Investors should note that this guarantee represents a direct financial obligation for Charter Communications.

Key Highlights

  • 1Charter Communications, Inc. issued an unconditional guarantee for approximately $1.8 billion of 13.50% Senior Notes due 2016.
  • 2The guaranteed notes are obligations of indirect subsidiaries CCH II, LLC and CCH II Capital Corp.
  • 3The guarantee is on a senior unsecured basis, covering principal, premium, and interest.
  • 4The event reported occurred on June 18, 2010.
  • 5This filing clarifies a material definitive agreement and a direct financial obligation for Charter.
  • 6The 13.50% interest rate on the notes is notable.

Frequently Asked Questions

This 8-K filing announces that Charter Communications, Inc. has entered into a material definitive agreement by providing an unconditional guarantee for approximately $1.8 billion of its subsidiaries' 13.50% Senior Notes due 2016. This also represents a direct financial obligation for Charter.

The guaranteed notes are the 13.50% Senior Notes due 2016, issued by Charter's indirect subsidiaries, CCH II, LLC and CCH II Capital Corp. The notes were originally issued under an indenture dated November 30, 2009.

An unconditional guarantee on a senior unsecured basis means Charter Communications, Inc. is directly and fully responsible for the payment of principal, premium, and interest on these notes if the issuing subsidiaries default. This strengthens the creditworthiness of the notes but also represents a significant liability for Charter.

The 13.50% interest rate is relatively high, suggesting that the notes were likely issued when borrowing costs were elevated, or it reflects the perceived risk associated with Charter or its subsidiaries at the time of issuance. Investors should consider this rate in the context of prevailing market conditions and the company's financial health.