According to a related 8-K filing, JPMorgan Chase and Bank of America are the lenders.
In the event advances are made under the credit agreement, those advances would be used solely to finance a portion of the cash consideration to be paid in the merger, the refinancing of debt of Time Warner and its subsidiaries and the payment of related fees and expenses.
Advances would bear interest, at the company’s option, either:
- At a variable annual rate equal to: the highest of the prime rate of JPMorgan Chase, 0.5% per annum above the federal funds rate and LIBOR applicable to dollars for a period of one month plus 1%, plus an applicable margin, as set forth in the credit agreement or
- At a rate equal to LIBOR for a period of one, two, three or six months, as applicable, plus an applicable margin, as set forth in the credit agreement
Advances under the credit agreement are conditioned on the following:
- The merger occurring substantially concurrently with the making of the advances in accordance with the terms of the merger agreement.
- The absence of a material adverse effect of Time Warner.
- Delivery of certain historical and pro forma financial information of the company and Time Warner.
- The absence of breaches of certain representations and warranties under the credit agreement and the merger agreement and no payment or bankruptcy default under the credit agreement.
- Certain customary documentation requirements
- Payment of fees and expenses due under the credit agreement
- Repayment of all advances must be made no later than 364 days after the date on which the advances are made.
“This is a perfect match of two companies with complementary strengths who can bring a fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers,” said Randall Stephenson, AT&T chairman and CEO. “Premium content always wins. It has been true on the big screen, the TV screen and now it’s proving true on the mobile screen. We’ll have the world’s best premium content with the networks to deliver it to every screen. A big customer pain point is paying for content once but not being able to access it on any device, anywhere. Our goal is to solve that. We intend to give customers unmatched choice, quality, value and experiences that will define the future of media and communications.”