Charter 2009 Annual Report Download - page 72

CCH II, LLC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2009, 2008, AND 2007
(dollars in millions, except where indicated)
F-24
The Charter Operating 10.875% senior second-lien notes may be redeemed at the option of Charter Operating on or
after varying dates, in each case at a premium, plus the Make-Whole Premium. The Make-Whole Premium is an
amount equal to the excess of (a) the present value of the remaining interest and principal payments due on a
10.875% senior second-lien note due 2014 to its final maturity date, computed using a discount rate equal to the
Treasury Rate on such date plus 0.50%, over (b) the outstanding principal amount of such note. The Charter
Operating 10.875% senior second-lien notes may be redeemed at any time on or after March 15, 2012 at specified
prices. In the event of specified change of control events, Charter Operating must offer to purchase the Charter
Operating 10.875% senior second-lien notes at a purchase price equal to 101% of the total principal amount of the
Charter Operating notes repurchased plus any accrued and unpaid interest thereon.
High-Yield Restrictive Covenants; Limitation on Indebtedness.
The indentures governing the CCH II, CCO Holdings and Charter Operating notes contain certain covenants that
restrict the ability of CCH II, CCH II Capital Corp., CCO Holdings, CCO Holdings Capital Corp., Charter
Operating, Charter Communications Operating Capital Corp., and all of their restricted subsidiaries to:
• incur additional debt;
• pay dividends on equity or repurchase equity;
• make investments;
• sell all or substantially all of their assets or merge with or into other companies;
• sell assets;
• enter into sale-leasebacks;
• in the case of restricted subsidiaries, create or permit to exist dividend or payment restrictions with respect
to the bond issuers, guarantee their parent companies debt, or issue specified equity interests;
• engage in certain transactions with affiliates; and
• grant liens.
CCO Holdings Credit Facility
The CCO Holdings credit facility consists of a $350 million term loan. The term loan matures on September 6,
2014. The CCO Holdings credit facility also allows the Company to enter into incremental term loans in the future,
maturing on the dates set forth in the notices establishing such term loans, but no earlier than the maturity date of the
existing term loans. However, no assurance can be given that the Company could obtain such incremental term
loans if CCO Holdings sought to do so. Borrowings under the CCO Holdings credit facility bear interest at a
variable interest rate based on either LIBOR or a base rate plus, in either case, an applicable margin. The applicable
margin for LIBOR term loans, other than incremental loans, is 2.50% above LIBOR. The applicable margin with
respect to the incremental loans is to be agreed upon by CCO Holdings and the lenders when the incremental loans
are established. The CCO Holdings credit facility is secured by the equity interests of Charter Operating, and all
proceeds thereof.
Charter Operating Credit Facilities
On the Effective Date, the Charter Operating credit facilities remain outstanding although the revolving line of credit
is no longer available for new borrowings and remains substantially drawn with the same maturity and interest
terms. The Charter Operating credit facilities have outstanding principal amount of $8.2 billion at December 31,
2009 as follows:
• a term loan with a remaining principal amount of $6.4 billion, which is repayable in equal quarterly
installments aggregating in each loan year to 1% of the original amount of the term loan, with the
remaining balance due at final maturity on March 6, 2014;
• an incremental term loan with a remaining principal amount of $491 million which is payable on March 6,
2014 and prior to that date will amortize in quarterly principal installments totaling 1% annually; and
• a revolving credit facility of $1.3 billion, with a maturity date on March 6, 2013.