Charter 2000 Annual Report Download - page 21

19 CHARTER COMMUNICATIONS
THE BIG PICTURE
Charter Communications, Inc. was organized as
a Delaware corporation in 1999 and conducted
an initial public offering of Class A common stock
in November 1999. Certain of our subsidiaries
commenced operations under the “Charter
Communications” name in 1994.
Charter Communications, Inc.’s principal asset
is a 40.8% equity interest and a 100% voting interest
in Charter Communications Holding Company, LLC.
Charter Communications Holding Company, through
its subsidiaries, owns cable systems and certain strategic
investments. Charter Communications, Inc. provides
management services to Charter Communications
Holding Company and its subsidiaries. As sole
manager, Charter Communications, Inc. controls
the affairs of Charter Communications Holding
Company and its subsidiaries.
Some of the membership units in certain of
Charter Communications, Inc.’s subsidiaries are
exchangeable at any time for shares of Class A
common stock of Charter Communications, Inc.
on a one-for-one basis. The following table sets
forth the pro forma outstanding shares of Charter
Communications, Inc. as if all exchangeable
membership units in subsidiaries had been
exchanged for Charter Communications, Inc.
common stock.
PRO FORMA SHARES
As of December 31, 2000:
Class A Common Stock 233,702,282 39.1%
Class B Common Stock 50,000 0.1
Total Common Stock
Outstanding 233,752,282 39.2
Exchangeable Equity
in Subsidiaries:
Charter Investment, Inc. 217,585,246 36.4
Vulcan Cable III Inc. 106,715,233 17.9
Former owners of
acquired systems 39,011,744 6.5
Total Exchangeable Equity 363,312,223
Total Pro Forma Common
Stock Outstanding 597,064,505 100%
THE COMPOSITION OF CHARTER
Charter Communications, Inc. Paul G. Allen owns approxi-
mately 3.8% of the outstanding capital stock of Charter
Communications, Inc. and controls approximately 93.5%
of the voting power of Charter Communications, Inc.’s
capital stock. The remaining equity interests and
voting power are held by the public. Mr. Allen’s voting
control arises primarily from his ownership of Charter
Communications, Inc.’s high vote Class B common stock,
which gives him voting rights that reflect investments by
his affiliates (Charter Investment, Inc. and Vulcan Cable
III Inc.) in our subsidiary, Charter Communications
Holding Company.
Vulcan Cable III Inc. Vulcan Cable III has an 18.6% equity
interest and no voting rights in Charter Communications
Holding Company. Vulcan Cable III’s membership units
in Charter Communication Holding Company are
exchangeable for shares of Charter Communications, Inc.
Class B common stock on a one-for-one basis at any time.
Shares of Class B common stock are exchangeable for
shares of Class A common stock on a one-for-one basis at
any time. Mr. Allen owns 100% of the outstanding stock
of Vulcan Cable III.
Charter Investment, Inc. Charter Investment, Inc.
has a 38.0% equity interest and no voting rights
in Charter Communications Holding Company.
Charter Investment’s membership units in Charter
Communications Holding Company are exchangeable
for shares of Charter Communications, Inc. Class B
common stock on a one-for-one basis at any time. Shares
of Class B common stock are exchangeable for shares of
Class A common stock on a one-for-one basis at any time.
Mr. Allen owns approximately 96.8% of the outstanding
capital stock of Charter Investment. The remaining 3.2%
equity interest is beneficially owned by our founders,
Jerald L. Kent, Howard L. Wood and Barry L. Babcock.
Former Owners of Acquired Cable Systems When we
purchased cable systems in 2000, some of the sellers
received a portion of their purchase price in the form
of membership units in certain of our subsidiaries rather
than in cash. These membership units are exchangeable
for shares of Charter Communications, Inc. Class A
common stock on a one-for-one basis at any time.
Charter Communications Holding Company, LLC Charter
Communications Holding Company is the direct 100%
parent of Charter Communications Holdings, LLC.
Charter Communications Holdings, LLC Charter
Communications Holdings, together with a wholly
owned subsidiary, is a co-issuer of publicly held
Charter Communications Holdings notes. Charter
Communications Holdings also owns the subsidiaries
that conduct all of our operations.
Operating Subsidiaries All of our operating subsidiaries
are wholly owned by Charter Communications Holdings.
Our subsidiaries are organized into four separate branches,
each of which has its own bank credit facility.