By Jennifer Chiou
New York, Aug. 29 - Charter Communications, Inc. said that Charter Communications Holding Co., LLC filed an S-4 with the Securities and Exchange Commission to begin an exchange offer for up to $309 million of its $413 million of 5.875% convertible senior notes due 2009.
Charter Holdco is offering up to $595 million of new 7% convertible senior notes due 2027.
The purpose of the exchange offer is to extend Charter's debt maturities.
The offer expires at 11:59 p.m. ET on Sept. 26.
The exchange consideration of new convertibles issued for the 5.875% convertibles will be determined based on the average of the volume-weighted daily price of Charter's class A common stock for the 10 consecutive trading days ending and including Sept. 24. The consideration will range from about $1,111 to $1,924 per $1,000 principal amount of 5.875% convertibles.
If the 10-day volume-weighted average price is between the two stock prices on the table below, the amount of new 7% convertibles to be issued per 5.875% convertible note will be determined by straight-line interpolation between the amounts set forth for the higher and lower stock prices.
The company said that the new 7% notes will be issued in multiples of $1,000 only.
Charter Holdco will pay accrued interest up to, but not including, the settlement date.
The new 7% notes will have an initial conversion rate based on a 40% premium to the 10-day volume-weighted average price.
Holders of the new convertibles will be able to put back the notes for cash on Oct. 1, 2012, 2017 and 2022 at par plus accrued interest.
Charter said that the exchange offer is conditioned upon the 10-day volume-weighted average price being between $2.00 and $4.35 as well as on a minimum of $75 million of 5.875% convertibles being tendered.
Global Bondholder Services Corp. (866 470-3700 or 212 430-3774) is information agent. Citigroup Global Markets Inc. (877 531-8365 or 212 723-7406) and Morgan Stanley (800 624-1808 or 212 761-5384) are dealer managers.
Charter is a St. Louis-based broadband communications company.
| Average price of Charter | Amount of new 7% notes | Conversion price | Conversion rate
|
| class A stock | to be issued
|
| $2.00 | $1,110.62 | $2.80 | 357.1429
|
| $2.20 | $1,173.25 | $3.08 | 324.6753
|
| $2.40 | $1,239.65 | $3.36 | 297.6190
|
| $2.60 | $1,309.13 | $3.64 | 274.7253
|
| $2.80 | $1,381.10 | $3.92 | 255.1020
|
| $3.00 | $1,451.68 | $4.20 | 238.0952
|
| $3.20 | $1,521.73 | $4.48 | 223.2143
|
| $3.40 | $1,592.26 | $4.76 | 210.0840
|
| $3.60 | $1,662.60 | $5.04 | 198.4127
|
| $3.80 | $1,733.33 | $5.32 | 187.9699
|
| $4.00 | $1,802.82 | $5.60 | 178.5714
|
| $4.20 | $1,872.80 | $5.88 | 170.0680
|
| $4.35 | $1,923.50 | $6.09 | 164.2036
|
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