SEC Filings

S-4/A
TIME WARNER INC. filed this Form S-4/A on 03/24/2000
Entire Document
 
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   Integration of Time Warner and America Online. The board of directors of
Time Warner considered the fact that the combination of the businesses of Time
Warner and America Online would be challenging, and the success of the
combination is not certain. The Time Warner board of directors noted, however,
that the management teams of Time Warner and America Online have a shared
vision of the potential created by the combination of traditional and new
media. The Time Warner board of directors further noted that the businesses of
both Time Warner and America Online are based, in part, on the acquisition and
retention of subscribers. In addition, the Time Warner board of directors noted
that both management teams share a consumer and marketing focus, a new media
interactive service orientation and a sense of social commitment and
responsibility. The Time Warner board of directors then noted that these
similarities in experiences and views are likely to facilitate the efforts of
the management teams of Time Warner and America Online to integrate their
businesses effectively and efficiently.
 
   Conditions, Termination Provisions, Termination Fee. The board of directors
of Time Warner reviewed the conditions to the completion of the merger and the
circumstances under which Time Warner or America Online would have the right to
terminate the merger agreement. In addition, the Time Warner board of directors
reviewed the provisions of the merger agreement that prohibit each of Time
Warner and America Online from soliciting any proposal or offer regarding any
acquisition of Time Warner or America Online, as the case may be. The board of
directors of Time Warner also reviewed the provisions of the merger agreement
that require the board of directors of each of Time Warner and America Online
to recommend adoption of the merger agreement by the stockholders of Time
Warner or America Online, as the case may be, and prohibit the board of
directors of each of Time Warner and America Online from withdrawing or
modifying its recommendation unless, subject to specified conditions, it has
received an unsolicited acquisition proposal which would, if completed, result
in a transaction that is more favorable to its stockholders than the merger and
which is reasonably capable of being completed. The Time Warner board of
directors also reviewed the various amounts that might be payable in the event
the merger agreement is terminated under specified circumstances. The Time
Warner board of directors noted that while these provisions could have an
impact on a third party considering an unsolicited acquisition proposal for
Time Warner, the provisions were reasonably necessary to protect both Time
Warner's and America Online's interests in the context of the proposed merger.
In addition, the Time Warner board of directors found reasonable the views of
its legal and financial advisors that the fees were within the range of fees
payable in comparable transactions and would not be expected to preclude an
unsolicited acquisition proposal for Time Warner.
 
   Option Agreements and Voting Agreement. The board of directors of Time
Warner also considered the terms of the option agreements to be entered into by
Time Warner and America Online in connection with the merger agreement and
their potential impact on a third party considering an unsolicited acquisition
proposal for Time Warner. The Time Warner board of directors noted that America
Online had specified that an agreement to enter into the option agreements was
a condition to entering into the merger agreement. The Time Warner board of
directors also noted that the option agreements would have largely an
accounting impact on the structure of an unsolicited acquisition proposal for
Time Warner, and it found reasonable the views of its legal and financial
advisors that the agreements would not be expected to preclude an unsolicited
acquisition proposal for Time Warner. In addition, the Time Warner board of
directors considered the terms of the voting agreement to be entered into by
Mr. Turner in connection with the merger agreement. The Time Warner board of
directors noted that, under the voting agreement, Mr. Turner would agree to
vote substantially all of his shares of common stock of Time Warner,
representing approximately 9% of the outstanding shares, in favor of adoption
of the merger agreement.
 
   Regulatory Matters. In addition to considering the various conditions that
must be satisfied prior to the completion of the merger, the board of directors
of Time Warner specifically considered the various regulatory filings and
approvals that would be necessary to complete the merger, including filings
with the Antitrust Division of the Department of Justice and Federal Trade
Commission, the approval of the Federal Communications Commission and the
approval of numerous state and local authorities and foreign regulators. The
Time Warner board of directors noted the view of members of senior management
of Time Warner that the
 
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