Print Page  Close Window

SEC Filings

S-4
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORP filed this Form S-4 on 01/25/2000
Entire Document
 
<PAGE>   477
             CHARTER COMMUNICATIONS HOLDINGS, LLC AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Options outstanding as of November 12, 1999, are as follows:
 

<TABLE>
<CAPTION>
                                              OPTIONS OUTSTANDING                          OPTIONS
                          ------------------------------------------------------------   EXERCISABLE
                                                                          REMAINING      -----------
                          NUMBER OF      EXERCISE          TOTAL          CONTRACT        NUMBER OF
                           OPTIONS        PRICE           DOLLARS      LIFE (IN YEARS)     OPTIONS
                          ----------  --------------    ------------   ---------------   -----------
<S>                       <C>         <C>               <C>            <C>               <C>
Outstanding as of
  January 1, 1999.......   7,044,127  $        20.00    $140,882,540         9.2(1)       1,761,032
Granted:
  February 9, 1999......   9,050,881           20.00     181,017,620                        130,000
  April 5, 1999.........     443,200           20.73       9,187,536                             --
  November 8, 1999......   4,600,000           19.00      87,400,000                             --
Cancelled...............   (378,400)   20.00 - 20.73      (7,595,886)                            --
                          ----------  --------------    ------------         ---          ---------
Outstanding as of
  November 12, 1999.....  20,759,808  $        19.79(1) $410,891,810         9.4(1)       1,891,032
                          ==========  ==============    ============         ===          =========
</TABLE>

 
---------------
(1) Weighted average
 
     The Company follows Accounting Principles Board Opinion No. 25, "Accounting
for Stock Issued to Employees" to account for the option plans. Stock option
compensation expense of $21.1 and $59.3 million for the three and nine months
ended September 30, 1999, respectively, has been recorded in the financial
statements since the exercise prices were less than the estimated fair values of
the underlying membership interests on the date of grant. Estimated fair values
were determined by the Company using the valuation inherent in the Paul Allen
Transaction and valuations of public companies in the cable television industry
adjusted for factors specific to the Company. Compensation expense is being
accrued over the vesting period of each grant that varies from four to five
years. As of September 30, 1999, deferred compensation remaining to be
recognized in future periods totaled $104 million. No stock option compensation
expense will be recorded for the November 8, 1999 options since the exercise
price is equal to the estimated fair value of the underlying membership
interests on the date of grant. Since the membership units are exchangeable into
Class A common stock of Charter Communications, Inc. on a one-for-one basis, the
estimated fair value was equal to the initial offering price of Class A common
stock.
 
7.  ACCOUNTING STANDARD NOT YET IMPLEMENTED:
 
     SFAS No. 137 "Accounting for Derivative Instruments and Hedging
Activities -- Deferral of the Effective Date of FASB Statement No. 133 -- An
Amendment of FASB Statement No. 133" has delayed the effective date of SFAS No.
133 to fiscal years beginning after June 15, 2000. We have not yet quantified
the impact of adopting SFAS No. 133 on our consolidated financial statements nor
have we determined the timing or method of our adoption of SFAS No. 133.
However, SFAS No. 133 could increase volatility in earnings (losses).
 
8.  SUBSEQUENT EVENTS:
 
     In October 1999, the Company acquired cable television systems from
InterMedia in a transaction for an aggregate purchase price of $873 million plus
adjustments and exchanged company-operated cable television systems serving
approximately 144,000 customers. At the closing, Charter Holdings retained a
cable television system serving approximately 30,000 customers for which Charter
Holdings was unable to obtain the necessary regulatory approvals. If the
necessary regulatory approvals cannot be obtained for the transfer of this
system by March 20, 2000 and Charter Holdings is unable to transfer to
InterMedia satisfactory replacement systems before April 1, 2000, Charter
Holdings must pay InterMedia $88.2 million. In addition, if Charter Holdings
transfers cash or property other than the retained system to InterMedia, in
certain circumstances, Charter Holdings must indemnify InterMedia 50% of all
taxes and related
 
                                      F-248