InvestorsAugust 24, 2005
Charter Communications Announces Private Debt Exchange Offers for $8.4 Billion of Debt Securities
ST. LOUIS--(BUSINESS WIRE)--Aug. 24, 2005--Charter Communications, Inc. (NASDAQ: CHTR) announced today that Charter Communications Holdings, LLC ("Charter Holdings") and its wholly owned subsidiaries, CCH I, LLC ("CCH I") and CCH I Holdings, LLC ("CIH"), are commencing private offers to exchange any and all of the $8.4 billion aggregate principal amount of outstanding debt securities listed below of Charter Holdings (the "Old Notes") in a private placement for new debt securities.
The offer is made only to qualified institutional buyers and institutional accredited investors inside the United States and to certain non-U.S. investors located outside the United States. The purpose of these private exchange offers is to improve Charter Holdings' financial flexibility by extending debt maturities and reducing indebtedness.
CCH I is offering to issue $3.525 billion aggregate principal amount of new 11.00% Senior Secured Notes due 2015 of CCH I (the "CCH I Notes") in exchange for Old Notes that mature in 2009 and 2010 ("Old 2009-2010 Notes"). Of that amount, up to $750 million (subject to increase) principal amount of CCH I notes is issuable in exchange for Old Notes that mature in 2011 and 2012 ("Old 2011-2012 Notes"). In addition, CIH is offering to issue $4.262 billion aggregate principal amount of various series of Senior Accreting Notes due 2014 and 2015 (the "CIH Notes") in exchange for any and all of the Old 2011-2012 Notes.
For each $1,000 principal amount of tendered Old 2011-2012 Notes, CIH will issue CIH Notes with a principal amount of $1,000 and the same coupon as the corresponding series of Old 2011-2012 Notes. The principal amount of CCH I Notes issuable in exchange for each $1,000 principal amount of Old Notes is listed in the table below.
Principal Amount Old Notes to be Exchanged CUSIP Outstanding for CCH I Notes ------------------------ --------------- ---------------------------- 2009-2010 Notes 16117PAE0 $1,244,067,000 8.625% Senior Notes due 2009 16117PAK6 640,437,000 10.00% Senior Notes due 2009 16117PAT7 874,000,000 10.75% Senior Notes due 2009 16117PAZ3 639,567,000 9.625% Senior Notes due 2009 16117PAL4 318,195,000 10.25% Senior Notes due 2010 16117PAM2 449,500,000 11.75% Senior Discount Notes due 2010 (fully accreted) 2011-2012 Notes 16117PAV2 $ 500,000,000 11.125% Senior Notes due 2011 16117PAF7 1,108,180,000 9.920% Senior Discount Notes due 2011 (fully accreted) 16117PBB5 709,630,000 10.00% Senior Notes due 2011 16117PBD1 939,306,000 11.75% Senior Discount Notes due 2011 16117PAW0 675,000,000 13.50% Senior Discount Notes due 2011 16117PBH2 329,720,000 12.125% Senior Discount Notes due 2012 CCH I Notes per $1,000 Principal Amount of Old Notes -------------------------------------------- Early Exchange Participation Total CUSIP Consideration Payment Consideration ------------------------ -------------- -------------- -------------- 2009-2010 Notes 16117PAE0 $780.00 $50.00 $830.00 16117PAK6 808.75 50.00 858.75 16117PAT7 811.25 50.00 861.25 16117PAZ3 778.75 50.00 828.75 16117PAL4 778.75 50.00 828.75 16117PAM2 813.75 50.00 863.75 2011-2012 Notes 16117PAV2 $748.75 $50.00 $798.75 16117PAF7 731.25 50.00 781.25 16117PBB5 731.25 50.00 781.25 16117PBD1 670.00 50.00 720.00 16117PAW0 768.75 50.00 818.75 16117PBH2 597.50 50.00 647.50
The CCH I Notes will mature on October 1, 2015 and will be secured by a pledge of 100% of the equity interests of CCH I's subsidiary, CCH II, LLC. Each series of CIH Notes will mature three years after the maturity date of the corresponding series of Old 2011-2012 Notes. Each series of CIH Notes will pay cash interest on 100% of the principal amount at the same rate, and on the same dates, as the corresponding series of Old 2011-2012 Notes. The accreted value of each series of CIH Notes will initially be $800 per $1,000 principal amount and will accrete on a straight-line basis to $1,000 per $1,000 principal amount on September 30, 2007.
All CCH I Notes and CIH Notes will be structurally senior to any Old Notes that remain outstanding after consummation of the exchange offers. CCH I is a direct subsidiary of CIH and CIH is a direct subsidiary of Charter Holdings.
Tenders of Old 2009-2010 Notes are not subject to proration. Tenders of Old 2011-2012 Notes for CIH Notes are also not subject to proration.
Tenders of Old 2011-2012 Notes for CCH I Notes are subject to proration as follows. The aggregate principal amount of CCH I Notes available to be issued in exchange for Old 2011-2012 Notes will be limited to the lesser of (i) $750 million (subject to increase in Charter Holdings' discretion) and (ii) the maximum amount that can be issued without causing the total principal amount of CCH I Notes issuable in the exchange offers to exceed $3.525 billion. If the offer to issue CCH I Notes in exchange for Old 2011-2012 Notes is oversubscribed, all tendered 11.125% Senior Notes due 2011, 9.92% Senior Discount Notes due 2011 and 10.00% Senior Notes due 2011 will be exchanged for CCH I Notes before any of the other Old 2011-2012 Notes are exchanged for CCH I Notes. To the extent holders of the Old 2011-2012 Notes who tendered for CCH I Notes do not receive CCH I Notes in the exchange offer because of the foregoing, such holders will instead receive CIH Notes as if they had tendered their Old 2011-2012 Notes for CIH Notes (unless they have elected otherwise, in which case their Old 2011-2012 Notes not accepted for CCH I Notes will be returned).
In order to be eligible to receive the early participation payment of $50.00 in principal amount of new notes, holders must tender their Old Notes on or prior to 5:00 PM Eastern Time (ET), on September 9, 2005, unless extended. Eligible holders who validly tender their Old Notes after that time will receive, for each $1,000 principal amount of Old Notes tendered, a principal amount of new notes equal to the total consideration for that series of Old Notes less the early participation payment. The early participation payment will be paid in CCH I Notes, to the extent Old Notes are exchanged for CCH I Notes, and will be paid in CIH Notes, to the extent Old Notes are exchanged for CIH Notes.
Tendered Old Notes may be validly withdrawn at any time prior to 5:00 PM ET, on September 9, 2005. Tendered Old Notes may not be withdrawn after that time.
Holders who exchange Old Notes for CCH I Notes will receive a cash payment on the settlement date of all accrued and unpaid cash interest to, but not including, the settlement date. The first payment of cash interest on each series of CIH Notes will include an amount equal to any cash interest accrued and unpaid to, but not including, the settlement date on the corresponding series of Old 2011-2012 Notes exchanged for CIH Notes. Such amount will be paid on the first date after the settlement date on which cash interest would be paid on the corresponding series of Old 2011-2012 Notes so exchanged.
The new notes have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. CCH I and CIH will enter into a registration rights agreement pursuant to which they will agree to file an exchange offer registration statement with the Securities and Exchange Commission with respect to the CCH I Notes and CIH Notes.
The complete terms and conditions of the exchange offers are set forth in the informational documents relating to the offers. The exchange offers are subject to significant conditions that are described in the informational documents.
Documents relating to the offers will only be distributed to noteholders who complete and return a letter of eligibility confirming that they are within the category of eligible investors for this private offer. Noteholders who desire a copy of the eligibility letter may contact Global Bondholder Service Corporation, the information agent for the offers, at (866) 470-3800 (U.S. Toll-free) or (212) 430-3774 (Collect).
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful.
About Charter Communications
Charter Communications, Inc., a broadband communications company, provides a full range of advanced broadband services to the home, including cable television on an advanced digital video programming platform via Charter Digital(TM), Charter High-Speed(TM) Internet service and Charter Telephone(TM). Charter Business(TM) provides scalable, tailored and cost-effective broadband communications solutions to organizations of all sizes through business-to-business Internet, data networking, video and music services. Advertising sales and production services are sold under the Charter Media(R) brand. More information about Charter can be found at www.charter.com .
Cautionary Statement Regarding Forward-Looking Statements:
This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), regarding, among other things, our plans, strategies and prospects, both business and financial. Although we believe that our plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Many of the forward-looking statements contained in this release may be identified by the use of forward-looking words such as "believe," "expect," "anticipate," "should," "planned," "will," "may," "intend," "estimated" and "potential," among others. Important factors that could cause actual results to differ materially from the forward-looking statements we make in this release are set forth in reports or documents that we file from time to time with the SEC, and include, but are not limited to:
All forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by this cautionary statement. We are under no duty or obligation to update any of the forward-looking statements after the date of this release.
CONTACT: Charter Communications Inc.
David Andersen, 314-543-2213
Mary Jo Moehle, 314-543-2397
SOURCE: Charter Communications Inc.