Charter Forms New Holding Companies

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Charter Communications Inc. said it reached an agreement with its lenders
that would result in the formation of a new holding company within the St.
Louis-based MSO's corporate structure, allowing it to accept a $300 million loan
from its chairman - and possibly serving as a vehicle to exchange bond debt.

In a terse press release, Charter said it would create intermediate holding
companies between Charter Communications Holdings LLC and Charter Communications
Operating LLC, which contains about $5.2 billion in senior secured debt.

Charter would also contribute equity from its other holding companies - CC
VI, CC VII and CC VIII - to those new holding companies.

How much equity it would contribute has not yet been determined.

According to sources in the financial community, the new holding companies
are being created to serve as a vehicle for a $300 million loan that Vulcan Inc.
- the investment vehicle of Charter chairman Paul Allen - said it would issue to
the cable operator in February.

Those funds are to be used to ensure the MSO
remains in compliance with its financial covenants.

While that money doesn't
have to be drawn down, Charter had to amend its bank agreements in order to
accept the loan.

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