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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): February 15, 2006
TIME WARNER INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-15062 13-4099534
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
One Time Warner Center, New York, New York 10019
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(Address of Principal Executive Offices) (Zip Code)
212-484-8000
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(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 (see General Instruction A.2 below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] 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 a Material Definitive Agreement.
On February 15, 2006, Time Warner Inc. (the "Company" or "Time Warner") and
certain of its subsidiaries completed the first of a series of planned financing
and refinancing transactions. Additional financing arrangements closed on
February 17, 2006, and February 21, 2006. Each of these transactions is
described in more detail below.
Time Warner Cable Inc. $6.0 Billion Revolving Credit Facility
On February 15, 2006, Time Warner Cable Inc. ("TWC Inc."), a subsidiary of the
Company, entered into an unsecured Amended and Restated $6.0 Billion Revolving
Credit Facility, dated as of February 15, 2006, among TWC Inc., as borrower, the
lenders party thereto, Bank of America, N.A., as Administrative Agent, Citibank,
N.A. and Deutsche Bank AG, New York Branch, as Co-Syndication Agents, and BNP
Paribas and Wachovia Bank, National Association, as Co-Documentation Agents (the
"Cable Revolving Credit Facility"). This agreement amends and restates an
existing $4.0 billion unsecured five-year revolving credit facility with a
maturity date of November 23, 2009.
As amended, the Cable Revolving Credit Facility has a maturity date of February
15, 2011. The aggregate available borrowings under the Cable Revolving Credit
Facility will be $4.0 billion prior to the closing of TWC Inc.'s pending
acquisition of assets from Adelphia Communications Corporation (the "Adelphia
Acquisition") and will increase to $6.0 billion upon the closing of the Adelphia
Acquisition. In addition, in connection with the amendment: (i) the existing
interest coverage ratio covenant was eliminated; (ii) the interest rate on
borrowed amounts, which is based on the credit rating for TWC Inc., was reduced
to LIBOR plus 0.27% per year, and the facility fee, which is also based on the
credit rating for TWC Inc., was reduced to 0.08% per year on the aggregate
amount of commitments, based on TWC Inc.'s current credit rating; and (iii) Time
Warner Entertainment Company, L.P. ("TWE") was removed as a borrower on the
facility. The additional $2.0 billion in commitments becomes effective
concurrent with (and is conditioned on) the closing of the Adelphia Acquisition.
The obligations of TWC Inc. under the Cable Revolving Credit Facility are
guaranteed by TWE and Time Warner NY Cable LLC ("TWNY"), a subsidiary of TWC
Inc. Warner Communications Inc. ("WCI") and American Television and
Communications Corporation ("ATC") (both wholly-owned subsidiaries of Time
Warner but not subsidiaries of TWC Inc.) have each guaranteed a pro-rata portion
of TWE's guarantee obligations. There are generally no restrictions on the
ability of WCI and ATC to transfer material assets to parties that are not
guarantors.
Time Warner Cable Inc. $4.0 Billion Five Year Term Loan Facility
On February 21, 2006, TWC Inc. entered into an unsecured Credit Agreement dated
as of February 21, 2006 among TWC Inc., as borrower, the lenders party thereto,
The Bank of Tokyo-Mitsubishi UFJ, Ltd. New York Branch, as Administrative Agent,
The Royal Bank of Scotland PLC and Sumitomo Mitsui Banking Corporation, as
Co-Syndication Agents, and Calyon New York Branch, HSBC Bank USA, N.A. and
Mizuho Corporate Bank, Ltd., as Co-Documentation Agents, for a $4.0 billion
five-year term loan facility (the "Cable Term Facility"). Borrowings under the
Cable Term Facility can be made only following or concurrently with the closing
of the Adelphia Acquisition. Although the proceeds of loans under the Cable Term
Facility can be used for working capital needs, general corporate purposes,
commercial paper support, and payments in connection with the Adelphia
Acquisition, it is expected that the Cable Term Facility will be used to fund a
portion of the cash consideration to be paid in the Adelphia Acquisition.
The obligations of TWC Inc. under the Cable Term Facility are guaranteed by TWE
and TWNY. WCI and ATC (both wholly-owned subsidiaries of Time Warner but not
subsidiaries of TWC Inc.) have each guaranteed a pro-rata portion of TWE's
guarantee obligations. There are generally no restrictions on the ability of WCI
and ATC to transfer material assets to parties that are not guarantors.
The Cable Term Facility has a maturity date of February 21, 2011. Borrowings
under the Cable Term Facility will bear interest at a rate determined by the
credit rating of TWC Inc., which rate currently would be LIBOR plus 0.40% per
year, and TWC Inc. will pay a facility fee on the aggregate commitments under
the Cable Term Facility prior to
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funding at a rate determined by its credit rating, which rate currently is 0.08%
per year. The Cable Term Facility has covenants similar to those contained in
the Cable Revolving Credit Facility.
TWC Inc. also expects to enter into a $4.0 billion three-year term loan facility
prior to the end of February 2006. Borrowings under this second term loan
facility also will be available concurrent with the closing of the Adelphia
Acquisition, and it is expected that the proceeds will be used to fund a portion
of the cash consideration to be paid in the Adelphia Acquisition.
Time Warner Inc. $7.0 Billion Revolving Credit Facility
On February 17, 2006, Time Warner entered into an unsecured Amended and Restated
$7.0 Billion Revolving Credit Facility, dated as of February 17, 2006, among
Time Warner and Time Warner International Finance Limited ("Time Warner
International"), as borrowers, the lenders party thereto, Citibank, N.A., as
Administrative Agent, BNP Paribas and Bank of America, N.A., as Co-Syndication
Agents, and Deutsche Bank AG, New York Branch and The Bank of Tokyo-Mitsubishi
UFJ, Ltd. New York Branch, as Co-Documentation Agents (the "TW Revolving Credit
Facility"). This agreement amends and restates Time Warner's existing $7.0
billion unsecured five-year revolving credit facility with a maturity date of
June 30, 2009.
As amended, the TW Revolving Credit Facility has a maturity date of February 17,
2011. The aggregate available borrowings under the TW Revolving Credit Facility
remain at $7.0 billion. In connection with the amendment: (i) the existing
interest coverage ratio covenant was eliminated; and (ii) the interest rate on
borrowed amounts, which is based on the credit rating for Time Warner, was
reduced to LIBOR plus 0.27% per year, and the facility fee, which is also based
on the credit rating for Time Warner, was reduced to 0.08% per year on the
aggregate amount of commitments, based on the Company's current credit rating.
The obligations of both Time Warner and Time Warner International are directly
or indirectly guaranteed by Time Warner's subsidiaries, America Online, Inc.,
Historic TW Inc., Turner Broadcasting System, Inc. and Time Warner Companies,
Inc. The obligations of Time Warner International are also guaranteed by Time
Warner.
Item 1.02. Termination of a Material Definitive Agreement.
As described in Item 1.01 of this Current Report on Form 8-K, TWE was removed as
a borrower under the Cable Revolving Credit Facility, as amended effective
February 15, 2006. As a result, the $1.5 billion unsecured commercial paper
program that TWE had maintained, which had no amounts outstanding at February
15, 2006, will be terminated. In the future, TWC Inc. and its subsidiaries,
including TWE, will utilize and rely on the existing $2.0 billion unsecured
commercial paper program maintained by TWC Inc. for access to the commercial
paper market. The Company does not expect any adverse impact on its, TWC Inc.'s
or TWE's liquidity as a result of the termination of TWE's commercial paper
program.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under an
Off-Balance Sheet Arrangement of a Registrant.
The information provided in Item 1.01 of this Current Report on Form 8-K is
hereby incorporated into this Item 2.03 by reference.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TIME WARNER INC.
By: /s/ Wayne H. Pace
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Name: Wayne H. Pace
Title:Executive Vice President
and Chief Financial
Officer
Date: February 22, 2006
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