Summary
Charter Communications, Inc. (CHTR) has filed an 8-K report to address the cessation of U.S. Dollar LIBOR and its impact on outstanding debt. Specifically, the company's Senior Secured Floating Rate Notes due 2024 will transition from three-month USD LIBOR to Three-Month CME Term SOFR as the benchmark interest rate. This change is being implemented in accordance with the Adjustable Interest Rate (LIBOR) Act and its related regulations. Investors holding these notes should be aware that interest rate calculations will now be based on a new benchmark, effective for interest periods after June 30, 2023. The transition includes a tenor spread adjustment as mandated by the LIBOR Act, ensuring a consistent and regulated approach to this significant financial transition. This proactive measure by Charter Communications aims to mitigate risks associated with the discontinuation of LIBOR and maintain financial stability for its debt obligations.
Key Highlights
- 1Cessation of USD LIBOR: The report addresses the upcoming discontinuation of U.S. Dollar LIBOR rates after June 30, 2023.
- 2Benchmark Transition: Charter Communications' Senior Secured Floating Rate Notes due 2024 will switch benchmarks.
- 3New Benchmark Selected: Three-Month CME Term SOFR will replace three-month USD LIBOR for interest rate calculations.
- 4Regulatory Compliance: The transition is being executed in accordance with the Adjustable Interest Rate (LIBOR) Act and Federal Reserve regulations.
- 5Trustee Action: The Bank of New York Mellon Trust Company, N.A. (as trustee) has made the benchmark selection.
- 6Interest Period Impact: The new benchmark will apply to interest periods with determination dates occurring after June 30, 2023.
- 7Spread Adjustment Included: A tenor spread adjustment for three-month LIBOR will be incorporated as per the LIBOR Act.