Charter 2004 Annual Report Download - page 131

CHARTER COMMUNICATIONS, INC. AND SUBSIDIARIES 2004 FORM 10-K
Notes to Consolidated Financial Statements (continued)
determined to be under 8.75 to 1.0 in February 2005, CC V Prior to April 2004, amounts under the CC VIII Operating
Holdings has called for redemption of such notes with an credit facilities bear interest at the Eurodollar rate or the base
anticipated redemption date of March 14, 2005. Following such rate, each as defined, plus a margin of up to 2.50% for
redemption and provided the Leverage Ratio of Charter Eurodollar loans (2.15% to 3.66% as of December 31, 2003) and
Holdings remains under 8.75 to 1.0, CC V Holdings and its up to 1.50% for base rate loans. A quarterly commitment fee of
subsidiaries (other than non-guarantor subsidiaries) will guaran- 0.25% was payable on the unborrowed balance of the revolving
tee the Obligations and grant a lien on all of their assets as to credit facilities.
which a lien can be perfected under the Uniform Commercial Charter Operating Credit Facilities Restrictive Covenants. The
Code by the filing of a financing statement.
Charter Operating credit facilities contain representations and
The Charter Operating credit facilities were amended and
warranties, affirmative and negative covenants similar to those
restated previously as of June 19, 2003 to allow for the insertion
described above with respect to the indentures governing the
of intermediate holding companies between Charter Holdings
Company’s notes, information requirements, events of default
and Charter Operating. In exchange for the lenders’ consent to
and financial covenants. The financial covenants, as defined,
the organizational restructuring, Charter Operating’s pricing
measure performance against standards set for leverage, debt
increased by 50 basis points across all levels in the pricing grid
service coverage, and operating cash flow coverage of cash
then in effect under the Charter Operating credit facilities.
interest expense on a quarterly basis or as applicable. Addition-
Amounts under the Charter Operating credit facilities, as
ally, the credit facilities contain provisions requiring mandatory
amended in 2003, bore interest at the Eurodollar rate or the
loan prepayments under specific circumstances, including when
base rate, each as defined, plus a margin of up to 3.0% for
significant amounts of assets are sold and the proceeds are not
Eurodollar loans (3.15% to 3.92% as of December 31, 2003) and
promptly reinvested in assets useful in the business of the
2.0% for base rate loans. A quarterly commitment fee of
borrower within a specified period. The Charter Operating
between 0.25% and 0.375% per annum was payable on the
credit facilities also provide that in the event that any
unborrowed balance of the revolving credit facilities.
indebtedness of CCO Holdings remains outstanding on the date,
As of December 31, 2004, outstanding borrowings under
which is six months prior to the scheduled final maturity, the
the Charter Operating credit facilities were approximately
term loans under the Charter Operating credit facilities will
$5.5 billion and the unused total potential availability was
mature and the revolving credit facilities will terminate on such
$804 million.
date. The events of default under the Charter Operating credit
CC VI Operating Credit Facilities. As discussed above, in April facilities include, among other things:
2004, Charter Operating was substituted as the lender in place (the failure to make payments when due or within the
of the banks for the CC VI Operating Credit Facilities applicable grace period,
Prior to April 2004, amounts under the CC VI Operating
(the failure to comply with specified covenants, including
credit facilities bore interest at the Eurodollar rate or the base
but not limited to a covenant to deliver audited financial
rate, each as defined, plus a margin of up to 2.5% for Eurodollar
statements with an unqualified opinion from the Company’s
loans (2.40% to 3.66% as of December 31, 2003) and 1.5% for
independent auditors,
base rate loans. A quarterly commitment fee of 0.25% per year
was payable on the unborrowed balance of the Term A facility (the failure to pay or the occurrence of events that cause or
and the revolving facility. permit the acceleration of other indebtedness owing by
CCO Holdings, Charter Operating or Charter Operating’s
Falcon Cable Credit Facilities. As discussed above, in April 2004, subsidiaries in amounts in excess of $50 million in aggregate
Charter Operating was substituted as the lender in place of the principal amount,
banks for the Falcon Cable Credit Facilities.
(the failure to pay or the occurrence of events that result in
Prior to April 2004, amounts under the Falcon Cable credit
the acceleration of other indebtedness owing by certain of
facilities bore interest at the Eurodollar rate or the base rate,
CCO Holdings’ direct and indirect parent companies in
each as defined, plus a margin of up to 2.25% for Eurodollar
amounts in excess of $200 million in aggregate principal
loans (2.40% to 3.42% as of December 31, 2003) and up to
amount,
1.25% for base rate loans. A quarterly commitment fee of
between 0.25% and 0.375% per year was payable on the (Paul Allen and/or certain of his family members and/or
unborrowed balance of the revolving facilities. their exclusively owned entities (collectively, the ‘‘Paul Allen
Group’’) ceasing to have the power, directly or indirectly,
CC VIII Operating Credit Facilities. As discussed above, in April to vote at least 35% of the ordinary voting power of
2004, Charter Operating was substituted as the lender in place Charter Operating,
of the banks for the CC VIII Operating Credit Facilities.
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