ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
Issuance of Senior Notes due 2023
On December 17, 2012 (the "Closing Date"), CCO Holdings, LLC and CCO Holdings
Capital Corp. (together with CCO Holdings, LLC, the "Issuers") subsidiaries of
Charter Communications, Inc. (the "Company") issued $1.00 billion aggregate
principal amount of 5.125% Senior Notes due 2023 (the "Notes"). The offering and
sale of the Notes were made pursuant to a shelf registration statement on Form
S-3, initially filed with the Securities and Exchange Commission on January 4,
2011, as amended on May 3, 2011, as further amended on November 9, 2011, and a
prospectus supplement dated December 12, 2012. The Issuers' payment obligations
under the Notes are fully and unconditionally guaranteed on a senior unsecured
basis by the Company.
The Notes resulted in net proceeds of approximately $988 million, after
deducting underwriting discounts and commissions. The net proceeds of this
issuance will be used for general corporate purposes, including repaying amounts
outstanding under the Charter Communications Operating, LLC credit facilities.
In connection therewith, the Issuers entered into the following agreement:
Indenture
On the Closing Date, the Issuers (and the Company as parent guarantor party
thereto) entered into a Fifth Supplemental Indenture with The Bank of New York
Mellon Trust Company, N. A. as trustee (the "Trustee") providing for the
issuance of the Notes (the "Supplemental Indenture") and the terms thereof. The
Supplemental Indenture supplements a base indenture previously entered into on
May 10, 2011 between the Issuers, the Company, as guarantor and the Trustee (the
"Base Indenture" and together with the Supplemental Indenture, the "Indenture")
providing for the issuance of the Notes generally. The Indenture provides, among
other things, that the Notes are general unsecured obligations of the Issuers.
Interest is payable on the Notes on each February 15 and August 15, commencing
February 15, 2013. The Company may redeem some or all of the Notes at any time
prior to February 15, 2018 at a redemption price equal to 100% of the principal
amount thereof plus accrued and unpaid interest, if any, on such Notes plus an
applicable make-whole premium. On or after February 15, 2018, the Issuers may
redeem some or all of the Notes at redemption prices set forth in the
Supplemental Indenture. In addition, at any time prior to February 15, 2016, the
Issuers may redeem up to 35% of the aggregate principal amount of the Notes at a
redemption price equal to 105.125% of the principal amount thereof plus accrued
and unpaid interest to the redemption date, with the net cash proceeds of
certain equity offerings, provided that certain conditions are met.
The Issuers' payment obligations under the Notes are fully and unconditionally
guaranteed on a senior unsecured basis by the Company.
The terms of the Indenture, among other things, limit the ability of the Issuers
to incur additional debt and issue preferred stock; pay dividends or make other
restricted payments; make certain investments; create liens; allow restrictions
on the ability of certain of its subsidiaries to pay dividends or make other
payments to it; sell assets; merge or consolidate with other entities; and enter
into transactions with affiliates.
Subject to certain limitations, in the event of a Change of Control (as defined
in the Supplemental Indenture), the Issuers will be required to make an offer to
purchase the Notes at a price equal to 101% of the aggregate principal amount of
the Notes repurchased, plus accrued and unpaid interest, if any, to the date of
repurchase.
The Indenture provides for customary events of default which include (subject in
certain cases to customary grace and cure periods), among others, nonpayment of
principal or interest; breach of other covenants or agreements in the Indenture;
failure to pay certain other indebtedness; failure to pay certain final
judgments; failure of certain guarantees to be enforceable; and certain events
of bankruptcy or insolvency. Generally, if an event of default occurs, the
Trustee or the holders of at least 25% in aggregate principal amount of the then
outstanding series of Notes may declare all the Notes of such series to be due
and payable immediately.
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