SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
Current
Report
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): September
13, 2006
CCH
II, LLC
CCH
II Capital Corp.
(Exact
name of registrants as specified in their charter)
Delaware
Delaware
(State
or Other Jurisdiction of Incorporation or Organization)
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333-111423
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03-0511293
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333-111423-01
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13-4257703
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(Commission
File Number)
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(I.R.S.
Employer Identification
Number)
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12405
Powerscourt Drive
St.
Louis, Missouri 63131
(Address
of principal executive offices including zip code)
(314)
965-0555
(Registrant's
telephone number, including area code)
Not
Applicable
(Former
name or former address, if changed since last report)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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Written
communications pursuant to Rule 425 under the Securities Act
(17 CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17
CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR
240.13e-4(c))
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ITEM
1.01 ENTRY INTO MATERIAL DEFINITIVE AGREEMENT.
On
September
14, 2006, Charter Communications, Inc. ("Charter"), the indirect parent
company
and manager of CCH II, LLC and CCH II Capital Corp. (collectively, “CCH
II”), announced the closing of the offer by its subsidiaries, CCHC, LLC
(“CCHC”) and CCH II to issue a combination of cash, Class A Common Stock of
Charter, and 10.25% Senior Notes due 2010 issued by CCH II (the “CCH II Notes”)
in exchange for $450.0 million of Charter’s 5.875% Convertible Senior Notes due
2009 (the "Convert Exchange"), as described in Item 8.01, "Other Events"
and in
the attached Exhibit 99.1.
Charter
also
announced the closing of the offers on September 14, 2006, by CCH II
and
Charter’s indirect subsidiaries, CCH I, LLC and CCH I Capital Corp.
(collectively, “CCH I”), to issue new notes in exchange (the “Private Exchange”)
for up to any and all of certain series of the outstanding debt securities
of
Charter Communications Holdings, LLC (“Charter Holdings”). CCH II has issued
$250.0 million principal amount of new 10.25% Senior Notes due 2013 (the
“New
CCH II Notes”) and CCH I has issued $462.0 million principal amount of 11.00%
Senior Secured Notes due 2015 (the “CCH I Notes”) in a private exchange for
$797.4 million principal amount of Charter Holdings notes as described
in Item
8.01, "Other Events" and in the attached Exhibits 99.2 and 99.3.
The
CCH II Notes
The
CCH II
Notes were issued pursuant to a supplemental indenture dated as of September
14,
2006, to the indenture dated as of September 23, 2003 among CCH II and
Wells
Fargo Bank, National Association, as trustee (as supplemented, the "CCH
II
Indenture"). The CCH II Notes are pari passu with, of the same class
as, will
vote on any matter submitted to bondholders with and otherwise substantially
identical in all respects to approximately $2.1 billion aggregate principal
amount of CCH II Notes that were outstanding. The CCH II Notes are the
senior
unsecured obligations of CCH II and rank pari passu to all of CCH II's
existing
and future unsecured indebtedness, including $250.0 million aggregate
principal
amount of New CCH II Notes that were issued in connection with the Private
Exchange.
The
CCH II
Indenture restricts the ability of CCH II and CCH II's restricted subsidiaries
to: (1) incur indebtedness; (2) create liens; (3) pay dividends or make
distributions in respect of capital stock and other restricted payments;
(4)
make investments; (5) sell assets; (6) create restrictions on the ability
of
restricted subsidiaries to make certain payments; (7) enter into transactions
with affiliates; or (8) consolidate, merge or sell all or substantially
all
assets. However, such covenants are subject to a number of important
qualifications and exceptions including provisions allowing CCH II and
its
restricted subsidiaries, as long as CCH II's leverage ratio is not greater
than
5.5 to 1.0, to incur additional indebtedness and make investments. CCH
II is
also permitted under these covenants to provide funds to its parent companies
to
pay interest on and, subject to meeting its leverage ratio test, to retire
or
repurchase their debt obligations.
The
CCH II
Notes bear interest at 10.25% per annum and will mature on September
15, 2010.
Interest is payable March 15 and September 15 of each year and are redeemable
at
CCH II's option on or after September 15, 2008 at a redemption price
of 105.125%
in 2008 and at par beginning on September 15, 2009. The CCH II Notes
were
registered on a Form S-4 with the Securities and Exchange Commission
(the "SEC")
under Registration No. 333-136508.
1
The
supplemental indenture dated as of September 14, 2006 is attached as
Exhibit
10.1.
The
New CCH II Notes
The
New CCH
II Notes were issued pursuant to an indenture dated as of September 14,
2006,
among CCH II, Charter Holdings and The Bank of New York Trust Company,
NA, as
trustee (the "Indenture"). The New CCH II Notes are senior unsecured
obligations
of CCH II and rank pari passu to all of CCH II’s existing and future unsecured
senior indebtedness, including $2.1 billion aggregate principal amount
of CCH II
Notes that were outstanding (the ‘‘outstanding CCH II 2010 notes’’) and the
$146.2 million aggregate principal amount of additional CCH II Notes
that were
issued in connection with the Convert Exchange. Charter Holdings has
guaranteed
the New CCH II Notes on a senior unsecured basis.
The
Indenture
restricts the ability of CCH II and CCH II’s restricted subsidiaries to: (1)
incur indebtedness; (2) create liens; (3) pay dividends or make distributions
in
respect of capital stock and other restricted payments; (4) make investments;
(5) sell assets; (6) create restrictions on the ability of restricted
subsidiaries to make certain payments; (7) enter into transactions with
affiliates; or (8) consolidate, merge or sell all or substantially all
assets.
However, such covenants are subject to a number of important qualifications
and
exceptions as described in the Indenture, including provisions allowing
CCH II
and its restricted subsidiaries, as long as CCH II’s leverage ratio is not
greater than 5.5 to 1.0, to incur additional indebtedness and make investments.
CCH II is also permitted under these covenants to provide funds to its
parent
companies to pay interest on and, subject to meeting its leverage ratio
test, to
retire or repurchase their debt obligations.
The
New CCH
II Notes will mature on October 1, 2013 and bear interest at 10.25 %
per annum,
payable on April 1 and October 1 of each year. The New CCH II Notes are
redeemable at CCH II's option on or after October 1, 2010 at various
redemption
prices beginning at 105.125% in 2010 and declining to par in 2012. In
addition,
prior to October 1, 2009, CCH II may redeem up to 35% of the New CCH
II Notes
from the proceeds of certain equity offerings at a specified redemption
price.
The
Indenture
is attached as Exhibit 10.2.
The
CCH I Notes
The
CCH I
Notes were issued pursuant to a supplemental indenture dated as of September
14,
2006, to an indenture dated as of September 28, 2005, among CCH I, Charter
Holdings and The Bank of New York Trust Company, NA, as trustee (as
supplemented, the "CCH I Indenture"). The CCH I Notes are pari passu
with, of
the same class as, and will vote on any matter submitted to bondholders
with and
otherwise be substantially identical in all respects to, the original
CCH I
Notes, except that (i) the CCH I Notes initially are subject to certain
restrictions on transfer (unless and until a subsequent exchange of registered
notes for these notes has been completed) and (ii) the CCH I Notes have
(and the
registered notes that may be subsequently offered in registered exchange
therefor will have) a separate CUSIP number from the outstanding CCH
I notes and
thus will not be fungible with the
2
outstanding
CCH I notes. The CCH I Notes, together with the outstanding CCH I notes,
have
the benefit of additional collateral as described below. The CCH I notes
are the
senior secured obligations of CCH I and will rank effectively senior
to all of
CCH I’s future unsecured senior indebtedness. The CCH I notes rank equally
with
all existing and future indebtedness of CCH I that may be secured equally
and
ratably by the collateral securing the CCH I notes, including $3,525
million
aggregate principal amount of CCH I’s outstanding CCH I notes.
The
CCH I
Notes are secured by a pledge of 100% of the equity interests of CCH
I’s wholly
owned subsidiary, CCH II, LLC, and the proceeds thereof, and by a pledge
of CCH
I's Class A preferred units in CC VIII, LLC (the "CC VIII interests"),
and the
proceeds thereof (collectively, the ‘‘collateral’’). The CC VIII interests are
entitled to a 2% accreting priority return on the priority capital. The
CC VIII
interests represented approximately 13% of the total equity interests
in CC VIII
at June 30, 2006. CC VIII and certain other subsidiaries have guaranteed,
on a
secured basis, the credit facility and senior second lien notes of CCH
I's
indirect subsidiary, Charter Communications Operating, LLC. In addition,
CC
VIII, LLC may from time to time be obligated on other secured or unsecured
indebtedness, including indebtedness to subsidiaries of CCH I. The CCH
I Notes
and the outstanding CCH I notes are, and all future indebtedness of CCH
I that
is permitted to be incurred by the CCH I indenture may be, secured equally
and
ratably by the collateral. The pledge agreement dated as of September
28, 2005
as amended by an amendment dated as of September 14, 2006, made by CCH
I in
favor of The Bank of New York Trust Company, NA, as collateral agent,
contains
certain limitations on the rights of the trustee and the holders to exercise
remedies with respect to the collateral. The amendment to the pledge
agreement
dated as of September 14, 2006 is attached hereto as Exhibit 10.3.
The
CCH I
Indenture restricts the ability of CCH I and CCH I’s restricted subsidiaries to:
(1) incur indebtedness; (2) create liens; (3) pay dividends or make
distributions in respect of capital stock and other restricted payments;
(4)
make investments; (5) sell assets; (6) create restrictions on the ability
of
restricted subsidiaries to make certain payments; (7) enter into transactions
with affiliates; or (8) consolidate, merge or sell all or substantially
all
assets. However, such covenants are subject to a number of important
qualifications and exceptions including provisions allowing CCH I and
its
restricted subsidiaries, as long as CCH I’s leverage ratio is not greater than
7.5 to 1.0, to incur additional indebtedness and make investments. CCH
I is also
permitted under these covenants to provide funds to its parent companies
to pay
interest on and, subject to meeting its leverage ratio test, to retire
or
repurchase their debt obligations.
The
CCH I
Notes will mature on October 1, 2015 and bear interest at 11.00 % per
annum,
payable on April 1 and October 1 of each year. The CCH I Notes are redeemable
at
CCH I's option on or after October 1, 2010 at various redemption prices
beginning at 105.500% in 2010 and declining to par in 2013. In addition,
prior
to October 1, 2008, CCH I may redeem up to 35% of the CCH I Notes from
the
proceeds of certain equity offerings at a specified redemption
price.
The
supplemental indenture dated as of September 14, 2006 to the CCH I Indenture
is
attached as Exhibit 10.4.
3
Charter
Holdings, CCH II and CCH I have entered into a registration rights agreement
pursuant to which they agreed to file an exchange offer registration
statement
with the SEC to allow the exchange of New CCH II Notes and CCH I Notes
for an
equal principal amount of notes with substantially identical terms (the
‘‘registered exchange offers’’), except they will generally be freely
transferable under the Securities Act of 1933, as amended. In addition,
Charter
Holdings, CCH II and CCH I agreed, under various circumstances, to file
a shelf
registration statement with the SEC to cover resales of the New CCH II
Notes and
CCH I Notes, respectively. If Charter Holdings, CCH I or CCH II fails
to satisfy
these obligations, CCH II or CCH I as applicable, will be required to
pay
additional interest to the holders of the New CCH II Notes or CCH I Notes,
as
applicable.
The
registration rights agreement dated as of September 14, 2006 is attached
hereto
as Exhibit 10.5.
ITEM
2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER
AN
OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
The
information in Item 1.01 of this Form 8-K is hereby incorporated by
reference to
this Item 2.03.
ITEM
8.01
OTHER EVENTS.
On
September
14, 2006, Charter Communications, Inc. ("Charter"), the indirect parent
company
and manager of CCH II, LLC and CCH II Capital Corp. (collectively, “CCH
II”), announced the closing of the offer by its subsidiaries, CCHC, LLC
(“CCHC”) and CCH II to issue a combination of cash, Class A Common Stock of
Charter, and 10.25% Senior Notes due 2010 issued by CCH II (the “CCH II Notes”)
in exchange for $450.0 million of Charter’s 5.875% Convertible Senior Notes due
2009. The offer was closed as scheduled on September 14, 2006, and the
$196.7
million in cash, including accrued interest, 41.5 million shares of Class
A
Common Stock (net of shares returned to Charter under the optional settlement
procedure described in the exchange offer prospectus) and $146.2 million
aggregate principal amount of CCH II Notes were issued (the "Convert
Exchange").
A press release announcing the closing of the offer is attached as Exhibit
99.1.
Charter
also
announced the closing of the offers on September 14, 2006, by CCH II
and
Charter’s indirect subsidiaries, CCH I, LLC and CCH I Capital Corp.
(collectively, “CCH I”), to issue new notes in exchange for up to any and all of
certain series of the outstanding debt securities of Charter Communications
Holdings, LLC (“Charter Holdings”). CCH II has issued $250.0 million principal
amount of new 10.25% Senior Notes due 2013 (the “New CCH II Notes”) and CCH I
has issued $462.0 million principal amount of 11.00% Senior Secured Notes
due
2015 (the “CCH I Notes”) in a private exchange for $797.4 million principal
amount of Charter Holdings notes. Press releases announcing the final
results of
the number of securities tendered and the closing of the offers are attached
as
Exhibits 99.2 and 99.3, respectively.
4
ITEM
9.01. FINANCIAL STATEMENTS AND EXHIBITS.
The
following exhibits are filed pursuant to Item 1.01:
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Exhibit
Number
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Description
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Exhibit
10.1
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Second
Supplemental Indenture dated as of September 14, 2006
for CCH II, LLC and
CCH II Capital Corp. 10,25% Senior Notes due 2010.
(Incorporated
by reference to Exhibit 10.1 to the current report
on Form 8-K of Charter
Communications, Inc. filed on September 19, 2006 (File
No. 000-27927)).
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| Exhibit 10.2 |
Indenture
dated as of September 14, 2006 for CCH II, LLC and CCH
II Capital Corp.
10.25% Senior Notes due 2013. (Incorporated
by reference to Exhibit 10.2 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19 2006 (File No.
000-27927)).
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| Exhibit 10.3 |
Amendment
to the Pledge agreement dated as of September 14, 2006
by CCH I, LLC.
(Incorporated
by reference to Exhibit 10.3 to the current report on Form 8-K of
Charter Communications, Inc. filed on September 19, 2006
(File No.
000-27927)).
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| Exhibit 10.4 |
First
Supplemental Indenture dated as of September 14, 2006
for CCH I, LLC and
CCH I Capital Corp. 11.00% Senior Secured Notes due 2015.
(Incorporated
by reference to Exhibit 10.4 to the current report on Form 8-K of
Charter Communications, Inc. filed on September 19, 2006
(File No.
000-27927)).
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| Exhibit 10.5 |
Exchange
and Registration Rights Agreement dated as of September
14, 2006 by CCH I,
LLC, CCH I Capital Corp., CCH II, LLC, CCH II Capital
Corp. and Charter
Communications Holdings, LLC. (Incorporated
by reference to Exhibit 10.5 to the current report on
Form 8-K of Charter
Communications, Inc. filed on September 19, 2006 (File
No. 000-27927)).
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| Exhibit 99.1 |
Press
release announcing the closing of registered exchange offer
dated as of
September 14, 2006. (Incorporated
by reference to Exhibit 99.1 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File No.
000-27927)).
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| Exhibit 99.2 |
Press
release announcing final results of the number of securities
tendered in
private debt exchange offers dated as of September 13,
2006. (Incorporated
by reference to Exhibit 99.2 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File
No. 000-27927)).
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| Exhibit 99.3 |
Press
release announcing closing of private debt exchange offers
dated as of
September 14, 2006. (Incorporated
by reference to Exhibit 99.3 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File
No. 000-27927)).
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5
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934,
CCH II,
LLC and CCH II Capital Corp. have duly caused this Current Report to be
signed on their behalf by the undersigned hereunto duly authorized.
CCH
II, LLC
Registrant
By:
CHARTER COMMUNICATIONS, INC., Sole Manager
Dated: September
19, 2006
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By:/s/
Grier C. Raclin
Name:
Grier C. Raclin
Title:
Executive Vice President and General Counsel and
Secretary
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CCH
II
CAPITAL CORP.
Registrant
Dated: September
19, 2006
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By:/s/
Grier C. Raclin
Name:
Grier C. Raclin
Title:
Executive Vice President and General Counsel
and
Secretary
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6
Exhibit
Index
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Exhibit
Number
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Description
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Exhibit
10.1
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Second
Supplemental Indenture dated as of September 14, 2006 for
CCH II, LLC and
CCH II Capital Corp. 10,25% Senior Notes due 2010. (Incorporated
by reference to Exhibit 10.1 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File
No. 000-27927)).
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| Exhibit 10.2 |
Indenture
dated as of September 14, 2006 for CCH II, LLC and CCH II Capital
Corp.
10.25% Senior Notes due 2013. (Incorporated
by reference to Exhibit 10.2 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19 2006 (File No. 000-27927)).
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| Exhibit 10.3 |
Amendment
to the Pledge agreement dated as of September 14, 2006 by CCH
I, LLC.
(Incorporated
by reference to Exhibit 10.3 to the current report on Form 8-K of
Charter Communications, Inc. filed on September 19, 2006 (File
No.
000-27927)).
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| Exhibit 10.4 |
First
Supplemental Indenture dated as of September 14, 2006 for
CCH I, LLC and
CCH I Capital Corp. 11.00% Senior Secured Notes due 2015.
(Incorporated
by reference to Exhibit 10.4 to the current report on Form 8-K of
Charter Communications, Inc. filed on September 19, 2006
(File No.
000-27927)).
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| Exhibit 10.5 |
Exchange
and Registration Rights Agreement dated as of September 14,
2006 by CCH I,
LLC, CCH I Capital Corp., CCH II, LLC, CCH II Capital Corp.
and Charter
Communications Holdings, LLC. (Incorporated
by reference to Exhibit 10.5 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File No.
000-27927)).
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| Exhibit 99.1 |
Press
release announcing the closing of registered exchange offer
dated as of
September 14, 2006. (Incorporated
by reference to Exhibit 99.1 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File No.
000-27927)).
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| Exhibit 99.2 |
Press
release announcing final results of the number of securities
tendered in
private debt exchange offers dated as of September 13, 2006.
(Incorporated
by reference to Exhibit 99.2 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File No.
000-27927)).
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| Exhibit 99.3 |
Press
release announcing closing of private debt exchange offers
dated as of
September 14, 2006. (Incorporated
by reference to Exhibit 99.3 to the current report on Form
8-K of Charter
Communications, Inc. filed on September 19, 2006 (File No.
000-27927)).
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