SEC Filings

S-4/A
TIME WARNER INC. filed this Form S-4/A on 03/24/2000
Entire Document
 
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stock held by directors and executive officers of Time Warner, options with
respect to 3,399,652 shares vested and became exercisable, and all 81,224
restricted shares of Time Warner common stock issued to directors and executive
officers vested and became free of restrictions.     
   
   Pursuant to the terms of the merger agreement, each Time Warner employee
stock option outstanding immediately prior to the completion of the merger will
be converted, upon completion of the merger, into an option to acquire, on the
same terms and conditions, the number of shares of AOL Time Warner common stock
that is equal to the product of the number of shares of Time Warner common
stock that could have been acquired upon exercise of the option immediately
before completion of the merger multiplied by 1.5, rounded to the nearest whole
share. The exercise price of these AOL Time Warner stock options will be the
exercise price for the Time Warner stock option immediately before completion
of the merger divided by 1.5.     
 
   Indemnification and Insurance. The merger agreement provides that, upon
completion of the merger, AOL Time Warner will indemnify and hold harmless, and
provide advancement of expenses to, all past and present directors, officers
and employees of Time Warner and its subsidiaries in all of their capacities:
 
  .  to the same extent they were indemnified or had the right to advancement
     of expenses as of January 10, 2000, which is the date of the merger
     agreement, pursuant to Time Warner's restated certificate of
     incorporation, by-laws and indemnification agreements with any
     directors, officers and employees of Time Warner and its subsidiaries;
     and
 
  .  to the fullest extent permitted by law, in each case for acts or
     omissions occurring at or prior to the completion of the merger.
 
   The merger agreement also provides that, upon completion of the merger, AOL
Time Warner will cause to be maintained, for a period of six years after
completion of the merger, the current policies of directors' and officers'
liability insurance and fiduciary liability insurance maintained by Time
Warner, or policies of at least the same coverage and amounts containing terms
and conditions which are, in the aggregate, no less advantageous to the
insured, with respect to claims arising from facts or events that occurred on
or before the completion of the merger, although AOL Time Warner will not be
required to expend in any one year an amount in excess of 200% of the annual
premiums currently paid by Time Warner for directors' and officers' liability
insurance and fiduciary liability insurance.
 
Completion and Effectiveness of the Merger
 
   The merger will be completed when all of the conditions to completion of the
merger are satisfied or waived, including the adoption of the merger agreement
by the stockholders of America Online and Time Warner. The merger will become
effective upon the filing of certificates of merger with the Secretary of State
of the State of Delaware.
 
   We are working toward completing the merger as quickly as possible. We
expect to complete the merger during the fall of 2000.
 
Structure of the Merger and Conversion of America Online and Time Warner Stock
 
   Structure. To accomplish the combination of their businesses, America Online
and Time Warner jointly formed a new company, AOL Time Warner with two
subsidiaries, America Online Merger Sub and Time Warner Merger Sub. At the time
the merger is completed:
 
  .  America Online Merger Sub will be merged into America Online, and
     America Online will be the surviving corporation; and
 
  .  Time Warner Merger Sub will be merged into Time Warner, and Time Warner
     will be the surviving corporation.
 
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