8-KMaterial AgreementsFinancial EventsRegulation FD+1

CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Material Agreement (Apr 22, 2015)

Filed April 22, 2015For Securities:CHTR

Summary

On April 21, 2015, Charter Communications, Inc. (CHTR), through its subsidiaries CCO Holdings, LLC and CCO Holdings Capital Corp., completed a significant debt offering, issuing a total of $2.7 billion in senior notes across three series: $1.15 billion in 5.125% Senior Notes due 2023, $750 million in 5.375% Senior Notes due 2025, and $800 million in 5.875% Senior Notes due 2027. The net proceeds from this issuance, approximately $2.68 billion after fees, are earmarked for refinancing existing debt, specifically for a tender offer on their 7.250% Senior Notes due 2017 and 8.125% Senior Notes due 2020, and repurchasing a portion of their 7.000% Senior Notes due 2019. This strategic move aims to optimize the company's debt structure and reduce interest expenses. In conjunction with the new debt issuance, Charter also announced the results of a tender offer, successfully purchasing approximately $633 million of the 2017 Notes and $528 million of the 2020 Notes. Furthermore, the company initiated redemption notices for the remaining 2017 and 2020 notes, as well as a partial redemption of its 2019 notes. These actions are part of a broader effort to manage its liabilities and align with its previously announced transaction with Advance/Newhouse Partnership.

Key Highlights

  • 1Charter Communications subsidiaries issued $2.7 billion in new senior notes across 2023, 2025, and 2027 maturities.
  • 2Net proceeds of approximately $2.68 billion will be used to refinance existing debt, including tender offers for 2017 and 2020 notes and repurchase of 2019 notes.
  • 3The company successfully purchased a significant portion of its 2017 and 2020 notes through a tender offer.
  • 4Charter initiated redemption of remaining 2017 and 2020 notes, and a partial redemption of 2019 notes.
  • 5The new debt is guaranteed by Charter Communications, Inc., with provisions for release upon completion of the Advance/Newhouse Partnership transaction.
  • 6The Indentures governing the new notes include covenants limiting additional debt, restricted payments, investments, liens, and asset sales.
  • 7Registration Rights Agreements were established, obligating Charter to file exchange offer registration statements within 540 days or face potential additional interest payments.

Frequently Asked Questions

Charter's subsidiaries, CCO Holdings, LLC and CCO Holdings Capital Corp., issued an aggregate principal amount of $2.7 billion in new senior notes. This comprises $1.15 billion of 5.125% Senior Notes due 2023, $750 million of 5.375% Senior Notes due 2025, and $800 million of 5.875% Senior Notes due 2027.

The net proceeds of approximately $2.68 billion will primarily be used to fund a tender offer for the company's 7.250% Senior Notes due 2017 and 8.125% Senior Notes due 2020, and to redeem or repurchase a portion of its 7.000% Senior Notes due 2019. The remaining funds will cover related fees, expenses, and general corporate purposes.

Charter's guarantee of the new senior notes will be released upon the completion of the previously announced transaction with Advance/Newhouse Partnership. This indicates that the debt structure and guarantees are being managed in anticipation of this significant corporate event.

The Indentures governing the new notes contain customary covenants that limit the ability of the Issuers to incur additional debt, make restricted payments (like dividends), make certain investments, create liens, sell assets, merge or consolidate, and enter into transactions with affiliates. These covenants are designed to protect the noteholders.