ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
Issuance of Senior Secured Floating Rate Notes due 2024 and 4.500% Senior Secured Notes due 2024
On July 3, 2018 (the Closing Date), Charter Communications Operating, LLC (CCO) and Charter Communications Operating Capital Corp.
(together with CCO, the Issuers) issued (i) $400 million aggregate principal amount of Senior Secured Floating Rate Notes due 2024 bearing interest at a floating rate equal to LIBOR plus 165 basis points, which LIBOR rate will be
reset quarterly (the Floating Rate Notes) and (ii) $1.1 billion aggregate principal amount of 4.500% Senior Secured Notes due 2024 (the Fixed Rate Notes and, together with the Floating Rate Notes, the Notes).
The offering and sale of the Notes were made pursuant to an automatic shelf registration statement on Form S-3 filed with the Securities and Exchange Commission on December 22, 2017 and a prospectus supplement dated June 28, 2018.
In connection therewith, the Issuers entered into the below agreement.
Secured Notes Indenture
On the Closing Date, the
Issuers, CCO Holdings, LLC (the Parent Guarantor) and the other guarantors party thereto entered into a Tenth Supplemental Indenture with The Bank of New York Mellon Trust Company, N.A., as trustee (in such capacity, the
Trustee) and as collateral agent (in such capacity, the Collateral Agent), in connection with the issuance of the Notes and the terms thereof (the Tenth Supplemental Indenture). The Tenth Supplemental Indenture
supplements a base indenture entered into on July 23, 2015, by and among the Issuers, CCO Safari II, LLC, the Trustee and the Collateral Agent (the Base Indenture and, together with the Tenth Supplemental Indenture, the
Indenture) providing for the issuance of senior secured notes of the Issuers generally.
The Indenture provides, among other things, that
interest is payable on the Floating Rate Notes on each February 1, May 1, August 1 and November 1, commencing November 1, 2018. Interest is payable on the Fixed Rate Notes on each February 1 and August 1,
commencing February 1, 2019.
The Floating Rate Notes may not be redeemed prior to January 1, 2024. On or after January 1, 2024, the
Issuers may redeem some or all of the outstanding Floating Rate Notes at a redemption price equal to 100% of the principal amount of the Floating Rate Notes to be redeemed, plus accrued and unpaid interest on the principal amount being redeemed to,
but not including, the redemption date. At any time and from time to time prior to January 1, 2024, the Issuers may redeem the outstanding Fixed Rate Notes in whole or in part at a redemption price equal to 100% of the principal amount thereof,
plus accrued and unpaid interest on the principal amount being redeemed to, but not including, the redemption date, plus a make-whole premium. On or after January 1, 2014, the Issuers may redeem some or all of the outstanding Fixed Rate Notes
at a redemption price equal to 100% of the principal amount of the Fixed Rate Notes to be redeemed, plus accrued and unpaid interest on the principal amount being redeemed to, but not including, the redemption date.
The Notes are senior secured obligations of the Issuers. The Notes are guaranteed on a senior secured basis by the Parent Guarantor and all of the
subsidiaries of the Issuers that guarantee the obligations of CCO under its credit agreement (collectively, the Guarantors). The Notes and the guarantees are secured by a
pari passu
, first priority security interest, subject to
certain permitted liens, in the Issuers and the Guarantors assets that secure obligations under the credit agreement.
The terms of the
Indenture, among other things, limit the ability of the Issuers to grant liens, sell all or substantially all of their assets or merge or consolidate with other entities.
The Indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among others, nonpayment
of principal or interest; breach of other covenants or agreements in the Indenture; failure of certain guarantees to be enforceable; cessation of a material portion of the collateral subject to liens or disaffirmation of obligations under the
security documents establishing the security interest in the collateral securing the Notes; and certain events of bankruptcy or insolvency. Generally, if an event of default occurs, the Trustee or the holders of at least 30% in aggregate principal
amount of the then outstanding Notes of a series may declare all the Notes of such series to be due and payable immediately.
For a complete description
of the Indenture and the Notes, please refer to copies of the Tenth Supplemental Indenture, the form of the Floating Rate Notes and the form of the Fixed Rate Notes filed herewith as Exhibits 4.2, 4.3 and 4.4, respectively. The foregoing
descriptions of the Indenture and the Notes do not purport to be complete and are qualified in their entirety by reference to the full text of those documents.