Charter subsidiaries get tenders for $338 million of 10¼% notes in exchange offer

By Angela McDaniels

Tacoma, Wash., June 30 - Charter Communications, Inc. said its indirect subsidiaries, CCH II, LLC and CCH II Capital Corp. (together, CCH II), received tenders for $338 million of their 10¼% senior notes due 2010 under a private offer to exchange up to $500 million of the notes for new 10¼% senior notes due 2013.

The offer began on May 29 and was conducted as a modified Dutch auction. Participants submitted tenders in the range of $1,047.50 to $1,077.50 principal amount of new notes per $1,000 principal amount of old notes.

The exchange offer expired at 11:59 p.m. ET on Friday.

The clearing exchange ratio for the offer is $1,077.50 of new notes for each $1,000 of old notes, according to a Monday news release. Accordingly, about $364 million of new notes will be issued under the offer.

Holders will also receive accrued interest up to but excluding the settlement date, which is expected to be Wednesday.

The payout includes an early participation payment of $30.00 principal amount of new notes for each $1,000 principal amount of old notes tendered. Before Charter modified the offer on June 12, only notes tendered by 5 p.m. ET on June 11 were slated to receive the early participation payment.

The new notes are guaranteed by Charter Communications Holdings, LLC and will accrue interest from the settlement date.

The new notes are part of the same series of notes as CCH II's $250 million principal amount of 10¼% senior notes due 2013 issued in September 2006.

The new notes are initially subject to some restrictions on transfer, were expected to be issued with an original issue discount and have a separate Cusip number from the existing CCH II 2013 notes, according to a previous news release.

The company said the purpose of the offer was to improve Charter's financial flexibility by extending debt maturities.

The offer was made only to qualified institutional buyers and to some non-U.S. investors located outside the United States.

Global Bondholder Service Corp. (866 470-3700 or 212 430-3774) was the information agent.

Charter is a broadband communications company based in St. Louis.

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