SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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):
January 26, 1995
TIME WARNER INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-8637 13-1388520
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
75 Rockefeller Plaza, New York, NY 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)
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Item 5. Other Events.
On January 26, 1995, Time Warner Inc. ("Time
Warner") entered into an Agreement and Plan of Merger (the
"Merger Agreement") with KBLCOM Incorporated ("KBLCOM"),
Houston Industries Incorporated ("Houston Industries") and
TW KBLCOM Acquisition Corp. ("Merger Sub"), a direct, wholly
owned subsidiary of Time Warner.
Pursuant to the Merger Agreement, Merger Sub will
merge with and into KBLCOM, which will become a direct,
wholly owned subsidiary of Time Warner, and all of the
outstanding capital stock of KBLCOM, which is owned by
Houston Industries, will be converted into the right to
receive an aggregate of 1,000,000 shares (subject to certain
adjustments) of common stock of Time Warner and
11,000,000 shares of a newly designated series of
convertible preferred stock of Time Warner (the "Preferred
Stock"). The Merger Agreement also provides that Time
Warner will purchase certain intercompany debt from Houston
Industries for approximately $600 million. To the extent
KBLCOM's indebtedness (including intercompany indebtedness),
working capital and related items exceed $1.24 billion at
the closing date, the payment for intercompany debt will be
reduced.
The Preferred Stock, which will have a liquidation
value of $100 per share, will be convertible into
22,909,040 shares of common stock, which is equivalent to a
conversion price of $48 per share. For the first four years
after the closing the Preferred Stock will pay cash
dividends at an annual rate of $3.75 per share. Thereafter,
dividends will be payable in an amount equal to dividends
paid on the shares of common stock into which the Preferred
Stock may be converted. Time Warner will have the right
after four years to exchange the Preferred Stock for common
stock at the stated conversion price plus accrued and unpaid
dividends. After five years after the closing, Time Warner
will have the right to redeem the Preferred Stock for cash
at a redemption price equal to the liquidation value plus
accrued and unpaid dividends.
The closing of the transaction is subject to
customary conditions for transactions of this type,
including certain regulatory approvals, as specified in the
Merger Agreement.
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KBLCOM owns and operates cable television systems
serving approximately 690,000 subscribers in San Antonio and
Laredo, Texas, the Minneapolis metropolitan area, Portland,
Oregon and Orange County, California. KBLCOM also owns 50%
of Paragon Communications ("Paragon"), with the other 50%
owned by Time Warner. Paragon serves approximately 967,000
cable subscribers including systems in Tampa, Florida and
northern Manhattan.
Item 7. Exhibits
2(a) Agreement and Plan of Merger dated as of
January 26, 1995, among KBLCOM Incorporated,
Houston Industries Incorporated, Time Warner Inc.
and TW KBLCOM Acquisition Sub
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SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of
New York, on January 30, 1995.
TIME WARNER INC.
By: /s/ Peter R. Haje
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Name: Peter R. Haje
Title: Executive Vice
President
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EXHIBIT INDEX
Exhibit No. Description of Exhibit
2(a) Agreement and Plan of Merger dated as
of January 26, 1995, among KBLCOM
Incorporated, Houston Industries
Incorporated, Time Warner Inc. and TW
KBLCOM Acquisition Sub