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CHARTER COMMUNICATIONS, INC. /MO/ 8-K Report, Corporate Update (Dec 22, 2017)

Reports
Other Events·Exhibits & Filings
Filing Date
Filed December 22, 2017
Period End
December 21, 2017
Security
CHTR
In the record · 2016–202610-K1110-Q328-K179

CHTR filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 179 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Feb ’17Feb ’17
  2. Material agreement8-K · Jul ’20Jul ’20
  3. Leadership change8-K · Sep ’22Sep ’22
  4. Leadership change8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed December 22, 2017. Cited figures are marked; the original filing is the authoritative source.

Charter Communications, Inc. (CHTR) has filed an 8-K report detailing an amendment to a prior agreement with Advance/Newhouse Partnership (A/N).

The amendment allows A/N to exchange an additional $400 milliona worth of common units in Charter Holdings for shares of Charter's Class A common stock. This exchange, which occurred on December 21, 2017, involved 1,263,497 common units being converted into an equal number of Class A shares. Furthermore, the amended agreement provides both parties with the option to terminate or suspend a 'Repurchase Participation' provision.

This provision previously required A/N to participate in Charter's share repurchases on a pro rata basis. This amendment could impact the dynamics of future share buybacks and capital allocation. The company anticipates an immediate step-up in the tax basis of Charter Holdings' assets resulting from the exchange, with the tax benefits to be shared equally with A/N under an existing Tax Receivables Agreement.

02—Key points

Key Highlights

  1. Amendment to existing agreement with Advance/Newhouse Partnership (A/N) executed on December 21, 2017.
  2. A/N to exchange an additional $400 million of Charter Holdings common units for Charter Class A common stock.
  3. Completed exchange of 1,263,497 common units for 1,263,497 Class A shares on December 21, 2017.
  4. Option for either Charter or A/N to terminate or suspend the Repurchase Participation provision.
  5. Potential for an immediate step-up in the tax basis of Charter Holdings' assets due to the exchange.
  6. Charter and A/N will equally share the tax benefits from the asset basis step-up, as per the Tax Receivables Agreement.
  7. Sales under the agreement are subject to Liberty Broadband Corporation's right of first refusal.

03—Questions

Frequently Asked Questions

  1. What is the main purpose of the amendment filed by Charter Communications?

    The amendment allows Advance/Newhouse Partnership (A/N) to exchange an additional $400 million worth of Charter Holdings common units for Charter's Class A common stock. It also modifies the terms related to Charter's share repurchase participation by A/N.

  2. What is the 'Repurchase Participation' provision, and how does the amendment affect it?

    The Repurchase Participation provision required A/N to participate proportionally in Charter's share buybacks from other parties. The amendment gives both Charter and A/N the right to terminate or suspend this provision prospectively, offering more flexibility in managing share repurchases.

  3. What is the financial impact of the exchange on Charter Communications?

    Charter expects an immediate step-up in the tax basis of Charter Holdings' assets as a result of the exchange. The company will share the resulting tax benefits equally with A/N, which could improve future tax efficiency.

  4. Are there any third-party rights affected by this transaction?

    Yes, any sale of shares or units by A/N to Charter or Charter Holdings under this agreement is subject to the right of first refusal held by Liberty Broadband Corporation, as per a prior agreement.

04—Continue

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