Charter 2012 Annual Report Download - page 92

CHARTER COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2012, 2011 AND 2010
(dollars in millions, except share or per share data or where indicated)
F- 17
In August 2012, CCO Holdings and CCO Holdings Capital Corp. closed on transactions in which they issued $1.25 billion aggregate
principal amount of 5.250% senior notes due 2022. The notes were issued at a price of 99.026% of the aggregate principal amount.
The proceeds from the notes were used for general corporate purposes, including repaying amounts outstanding under the Company's
revolving credit facility, and to fund the redemption of the CCH II 13.500% senior notes due 2016 during the fourth quarter of
2012.
In December 2012, CCO Holdings and CCO Holdings Capital Corp. closed on transactions in which they issued $1.0 billion
aggregate principal amount of 5.125% senior notes due 2023. The proceeds from the notes were used for general corporate
purposes, including repaying amounts outstanding under the Company's credit facilities. These transactions resulted in a loss on
extinguishment of debt for the year ended December 31, 2012 of approximately $33 million.
The CCO Holdings notes are guaranteed by Charter. They are senior debt obligations of CCO Holdings and CCO Holdings Capital
Corp. and rank equally with all other current and future unsecured, unsubordinated obligations of CCO Holdings and CCO Holdings
Capital Corp. The CCO Holdings notes are structurally subordinated to all obligations of subsidiaries of CCO Holdings, including
the Charter Operating notes and Charter Operating credit facilities.
CCO Holdings may redeem some or all of the CCO Holdings notes at any time at a premium. The optional redemption price
declines to 100% of the respective series’ principal amount, plus accrued and unpaid interest, if any, on or after varying dates in
2015 through 2018.
In addition, at any time prior to varying dates in 2013 through 2015, CCO Holdings may redeem up to 35% of the aggregate
principal amount of the notes at a redemption price at a premium plus accrued and unpaid interest to the redemption date, with
the net cash proceeds of one or more equity offerings (as defined in the indenture); provided that certain conditions are met.
In the event of specified change of control events, CCO Holdings must offer to purchase the outstanding CCO Holdings notes
from the holders at a purchase price equal to 101% of the total principal amount of the notes, plus any accrued and unpaid interest.
Charter Operating Notes
In August 2011, Charter Operating repurchased, in private transactions, a total of $193 million principal amount of Charter Operating
8.000% senior second-lien notes due 2012 for approximately $199 million cash. The transactions resulted in a loss on
extinguishment of debt of approximately $4 million for the year ended December 31, 2011.
In March 2012, Charter Operating redeemed the remaining $18 million of 10.875% senior notes due 2014 pursuant to a notice of
redemption.
High-Yield Restrictive Covenants; Limitation on Indebtedness.
The indentures governing the CCO Holdings notes contain certain covenants that restrict the ability of CCO Holdings, CCO
Holdings 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 CCO
Holdings, guarantee their parent companies debt, or issue specified equity interests;
• engage in certain transactions with affiliates; and
• grant liens.