SEC Filings

S-4/A
TIME WARNER INC. filed this Form S-4/A on 03/24/2000
Entire Document
 
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$7.5 million upon receipt of requisite shareholder approvals to complete the
merger; and $47.5 million upon completion of the merger. Additionally, America
Online has agreed to reimburse Salomon Smith Barney for reasonable out-of-
pocket expenses incurred by Salomon Smith Barney in performing its services,
including the fees and expenses of its legal counsel, and to indemnify Salomon
Smith Barney and related persons against certain liabilities, including
liabilities under the federal securities laws, arising out of Salomon Smith
Barney's engagement. In the ordinary course of business, Salomon Smith Barney
and its affiliates may actively trade or hold the securities of America Online
and Time Warner for their own account or for the account of customers and,
accordingly, may at any time hold a long or short position in such securities.
       
   Salomon Smith Barney has in the past provided investment banking services to
America Online unrelated to the merger, for which services Salomon Smith Barney
has received customary compensation. In addition, Salomon Smith Barney and its
affiliates, including Citigroup Inc. and its affiliates, may maintain
relationships with America Online or Time Warner.     
 
Recommendation of Time Warner's Board of Directors
 
   The Time Warner board of directors believes that the merger is fair to Time
Warner's stockholders and in their best interest, and recommends the adoption
of the merger agreement.
 
   In considering the recommendation of the Time Warner board of directors with
respect to the merger agreement, you should be aware that certain directors and
executive officers of Time Warner have interests in the merger that are
different from, or are in addition to, the interests of Time Warner
stockholders. Please see the section entitled "Interests of Certain Time Warner
Directors and Executive Officers in the Merger" that begins on page 55 of this
joint proxy statement-prospectus.
 
Opinion of Time Warner's Financial Advisor
 
   Time Warner retained Morgan Stanley to provide it with financial advisory
services and a financial fairness opinion in connection with the merger. The
Time Warner board of directors selected Morgan Stanley to act as Time Warner's
financial advisor based on Morgan Stanley's qualifications, expertise and
reputation and its knowledge of the business and affairs of Time Warner. At the
meeting of the Time Warner board on January 9, 2000, Morgan Stanley rendered
its oral opinion, subsequently confirmed in writing, that as of January 9,
2000, and subject to and based on the considerations in its opinion, the
exchange ratio pursuant to the merger agreement is fair from a financial point
of view to the holders of Time Warner common stock and series common stock.
 
   The full text of Morgan Stanley's opinion, dated as of January 9, 2000,
which sets forth, among other things, the assumptions made, procedures
followed, matters considered and limitations on the review undertaken by Morgan
Stanley is attached as Annex F to this joint proxy statement-prospectus. We
urge you to read this opinion carefully and in its entirety. Morgan Stanley's
opinion is directed to the board of directors of Time Warner, addresses only
the fairness from a financial point of view of the exchange ratio pursuant to
the merger agreement to the holders of Time Warner common stock and series
common stock, and does not address any other aspect of the merger or constitute
a recommendation to any Time Warner stockholder as to how to vote at the
special meeting. This summary is qualified in its entirety by reference to the
full text of the opinion.
 
   In connection with rendering its opinion, Morgan Stanley, among other
things:
 
  .  reviewed certain publicly available financial statements and other
     information of America Online and Time Warner;
 
  .  discussed the past and current operations and financial condition and
     the prospects of America Online and Time Warner with senior executives
     of America Online and Time Warner, respectively;
 
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