SEC Filings

S-4/A
TIME WARNER INC. filed this Form S-4/A on 03/24/2000
Entire Document
 
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   Finally, consider the case in which America Online terminates the merger
agreement because the Time Warner board of directors fails to recommend that
the stockholders of Time Warner vote in favor of the adoption of the merger
agreement or effects a Change in Board Recommendation or because Time Warner
materially breaches its obligations under the merger agreement by failing to
call the Time Warner special meeting or to mail this joint proxy statement-
prospectus to its stockholders. Time Warner must pay to America Online an
amount equal to 2.75% of the Time Warner Termination Amount.     
 
   America Online Termination Fee. Similarly, if either party terminates the
merger agreement because:
 
  .  the approval of the stockholders of America Online is not obtained; or
 
  .  the merger is not completed on or before May 31, 2001 and the special
     meeting of America Online's stockholders to vote on the adoption of the
     merger agreement has not occurred; and
 
    .  an Acquisition Proposal with respect to America Online has been
       publicly announced or communicated to the senior management, board
       of directors or stockholders of America Online at any time after
       January 10, 2000, the date of the merger agreement, and before the
       date of termination of the merger agreement; and
 
    .  within 12 months of the termination of the merger agreement, America
       Online or any of its subsidiaries enters into any definitive
       agreement with respect to, or consummates, an Acquisition Proposal
       involving 40% or more of the consolidated assets of America Online
       and its subsidiaries, taken as a whole, or 40% or more of the total
       voting power of America Online, or of the surviving parent entity in
       the transaction, or any of its significant subsidiaries; or
 
if Time Warner terminates the merger agreement because:
     
  .  the board of directors of America Online fails to recommend that the
     stockholders of America Online vote in favor of the adoption of the
     merger agreement or effects a Change in Board Recommendation; or     
 
  .  America Online materially breaches its obligations under the merger
     agreement because of its failure to call a special meeting of its
     stockholders to vote on the adoption of the merger agreement or its
     failure to mail this joint proxy statement-prospectus to its
     stockholders;
   
then America Online must pay Time Warner an amount equal to 2.75% of the
America Online Termination Amount, as described below. In addition, America
Online must pay Time Warner an amount equal to 1% of the America Online
Termination Amount if either party terminates the merger agreement because the
approval of the stockholders of America Online is not obtained; except that
this amount need not be paid if the termination fee has otherwise been paid in
connection with the termination of the merger agreement, as described in the
previous sentence.     
 
   "America Online Termination Amount" means an amount equal to the product
of:
 
     (x) the number of shares of common stock of America Online outstanding
  as of January 10, 2000, the date of the merger agreement, assuming the
  exercise of all outstanding options, other than the option granted to Time
  Warner, and the conversion into America Online common stock of all
  securities of America Online convertible into America Online common stock;
  multiplied by
     
     (y) the last sale price of common stock of America Online on the New
  York Stock Exchange on January 7, 2000.     
   
   For example, consider the case in which either America Online or Time
Warner terminates the merger agreement because the approval of the America
Online stockholders is not obtained. America Online must pay to Time Warner:
       
  .  an amount equal to 2.75% of the America Online Termination Amount if:
            
    .  at any time prior to the termination of the merger agreement, an
       Acquisition Proposal with respect to America Online was publicly
       announced or otherwise communicated to America Online; and     
 
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