Rule 424(b)(3)
File No.: 333-30532
PROSPECTUS
450,000 Shares
Time Warner Inc.
Common Stock, Par Value $0.01 per Share
This prospectus relates to 450,000 shares of common stock, par value
$0.01 per share, of Time Warner Inc., issued in connection with the
acquisition by Time Warner Entertainment Company, L.P. of the interest in
Queens Inner Unity Cable System not already owned by it (the "Acquisition").
Each share of Time Warner common stock was issued together with an associated
Right to Purchase Series A Participating Cumulative Preferred Stock of Time
Warner, but until the occurrence of certain events, these rights are not
exercisable, will be evidenced by ownership of the common stock and will be
transferred along with the common stock. These shares of Time Warner common
stock are being offered for sale from time to time pursuant to this prospectus
for the account of certain persons who have acquired the shares issued in the
Acquisition.
The Time Warner common stock covered by this prospectus is listed on the
New York Stock Exchange ("NYSE"). On May 23, 2000, the last sale price for one
share of Time Warner common stock was $ 74.25 as reported on the NYSE
Composite Transactions Tape.
The Time Warner common stock covered by this prospectus may be offered
for sale from time to time in accordance with the plan of distribution
described in this prospectus by the selling stockholders originally named
herein, or by certain other persons, who qualify as "Permitted Holders" under
the Registration Rights Agreement described herein and who are named in an
amendment or supplement to this prospectus.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
The date of this prospectus is May 24, 2000
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Table of Contents
Page
Where you can find more information.............................. 2
Incorporation of certain documents by reference.................. 3
The Company...................................................... 4
Use of Proceeds.................................................. 5
The Acquisition.................................................. 5
Selling Stockholders............................................. 6
Plan of Distribution............................................. 6
Legal Opinion.................................................... 7
Experts.......................................................... 7
WHERE YOU CAN FIND MORE INFORMATION
Time Warner files reports, proxy statements and other information with
the Securities and Exchange Commission pursuant to public reporting
requirements of the Securities Exchange Act of 1934. These documents may be
inspected and copied at the public reference facilities maintained by the
Securities and Exchange Commission at:
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, NY 10048 Suite 1400
Chicago, Illinois 60661
Information on the operation of the Public Reference Room may be obtained
by calling the Securities and Exchange Commission at 1-800-SEC-0330. These
Securities and Exchange Commission filings are also available to the public
from commercial document retrieval services and at the internet world wide web
site maintained by the Securities and Exchange Commission at
"http://www.sec.gov".
Time Warner's common stock is traded on the New York Stock Exchange.
Reports, proxy statements and other information concerning Time Warner may be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad
Street, New York, New York.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows Time Warner to "incorporate
by reference" information into this prospectus, which means that Time Warner
can disclose important information to you by referring you to other documents
filed separately with the Securities and Exchange Commission. The information
incorporated by reference is considered part of this prospectus, except for
any information superseded by information contained directly in this
prospectus or in later filed documents incorporated by reference in this
prospectus.
This prospectus incorporates by reference the documents set forth below
that Time Warner has previously filed with the Securities and Exchange
Commission. These documents contain important business and financial
information about Time Warner that is not included in or delivered with this
prospectus.
Time Warner Inc. (File No.1-12259) Period or Date
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1. Annual Report on Form 10-K Year ended December 31, 1999.
2. Quarterly Reports on Form 10-Q Quarter ended March 31, 2000.
3. Current Reports on Form 8-K January 10, 2000 (filed January 14, 2000);
January 23, 2000 (filed January 28, 2000);
February 2, 2000 (filed February 10, 2000);
January 10, 2000 (filed February 11, 2000);
March 13, 2000 (filed March 13, 2000);
March 31, 2000 (filed March 31, 2000);
April 12, 2000 (filed April 19, 2000);
April 19, 2000 (filed April 25, 2000); and
May 22, 2000 (filed May 22, 2000).
4. The description of Time Warner Inc. common
stock, par value $0.01 per share, set forth
in Item 4 in the registration statement on
Form 8-B as filed with the Securities and
Exchange Commission on October 2, 1996
pursuant to Section 12(b) of the Securities
Exchange Act of 1934, as amended by a Form
8-A/A filed with the Securities and Exchange
Commission on January 31, 2000.
Time Warner also incorporates by reference additional documents that may
be filed with the Securities and Exchange Commission under Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act after the date of this
prospectus and prior to the time all of the securities offered by this
prospectus are sold. These include periodic reports, such as Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as
well as proxy statements.
If you are a stockholder, Time Warner may have sent you some of the
documents incorporated by reference, but you can obtain any of them through
Time Warner, the Securities and Exchange Commission or the Securities and
Exchange Commission's Internet web site as described above. Documents
incorporated by reference are available from Time Warner without charge,
excluding all exhibits, except that if Time Warner has specifically
incorporated by reference an exhibit in this prospectus, the exhibit will also
be provided without charge. Stockholders may obtain documents incorporated by
reference in this prospectus by requesting them in writing or by telephone
from Time Warner at the following address:
Time Warner Inc.
75 Rockefeller Plaza
New York, NY 10019
Telephone: (212) 484-6971
Attn: Investor Relations
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THE COMPANY
Because the following is a summary of the business of Time Warner, it
does not contain all the information that may be important to investors. You
should read it together with the detailed information and financial statements
referred to or incorporated by reference herein.
Description of Business
Time Warner is the world's leading media and entertainment company. Time
Warner's principal business objective is to create and distribute branded
information and entertainment copyrights throughout the world. Time Warner
classifies its business interests into six fundamental areas:
o Cable Networks, consisting principally of interests in cable
television programming;
o Publishing, consisting principally of interests in magazine
publishing, book publishing and direct marketing;
o Music, consisting principally of interests in recorded music and
music publishing;
o Filmed Entertainment, consisting principally of interests in filmed
entertainment, television production and television broadcasting;
o Cable, consisting principally of interests in cable television
systems; and
o Digital Media, consisting principally of interests in
Internet-related and digital media businesses.
Investment in TWE
Time Warner is a holding company that derives its operating income and
cash flow from its investments in its subsidiaries, including Time Warner
Entertainment Company, L.P., or "TWE", a limited partnership that owns a
majority of Time Warner's interests in filmed entertainment, television
production, television broadcasting and cable television systems, and a
portion of its interests in cable television programming. Time Warner owns
general and limited partnership interests in TWE consisting of 74.49% of the
pro rata priority capital and residual equity capital, and 100% of the junior
priority capital. The remaining 25.51% limited partnership interests in the
pro rata priority capital and residual equity capital of TWE are held by a
subsidiary of MediaOne Group, Inc. A significant portion of TWE's cable
television systems are held by the Time Warner Entertainment- Advance/Newhouse
Partnership, of which TWE is the managing partner and owns a 64.8% interest.
Agreement to merge with AOL
On January 10, 2000, Time Warner announced that it had entered into an
Agreement and Plan of Merger dated as of January 10, 2000, between America
Online, Inc. ("AOL") and Time Warner. Under the terms of the merger agreement,
Time Warner and AOL have formed a new holding company, named AOL Time Warner
Inc., which wholly owns two subsidiaries. At the closing of the transaction,
one of these subsidiaries will merge with and into AOL, and the other
subsidiary will merge with and into Time Warner. As a result of the mergers,
Time Warner and AOL will each become a wholly owned subsidiary of AOL Time
Warner Inc.
Under the terms of the merger agreement, Time Warner and AOL stock will
be converted to AOL Time Warner stock at fixed exchange ratios. Each share of
Time Warner common stock will be exchanged for 1.5 shares of AOL Time Warner
common stock, and each share of AOL common stock will be exchanged for 1.0
share of AOL Time Warner common stock. Each share of each series of Time
Warner Preferred Stock will be converted into one share of a substantially
identical series of AOL Time Warner Preferred Stock.
The mergers are subject to various conditions set forth in the merger
agreement, including the adoption of the merger agreement by the stockholders
of each of Time Warner and AOL, certain U.S. and foreign regulatory approvals
and other customary conditions. It is anticipated that the mergers will be
completed during the fall of 2000. Additional information concerning the
mergers is contained in Time Warner's Current Report on Form 8-K dated May 22,
2000.
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Combination Agreement with EMI
On January 24, 2000, Time Warner and EMI Group plc announced that they
had signed definitive agreements to combine their recorded music and music
publishing businesses into a global joint venture. The new company, Warner EMI
Music, will be one of the world's leading music companies, with broad domestic
and international holdings. The global joint venture will be owned equally by
Time Warner and EMI Group. The eleven-member Warner EMI Music board of
directors, controlled by Time Warner, will consist of six Time Warner
designees and five EMI designees.
The transaction is subject to certain conditions, including regulatory
consents and EMI Group shareholder approval, and is expected to be completed
by the end of 2000. Additional information concerning the transaction is
contained in Time Warner's Current Report on Form 8-K dated January 23, 2000.
General
Time Warner's principal executive offices are located at 75 Rockefeller
Plaza, New York, New York 10019 and its telephone number is (212) 484-8000.
USE OF PROCEEDS
Time Warner will not receive any of the proceeds from the sale from time
to time of the Time Warner common stock offered hereby. All proceeds from the
sale of the common stock offered hereby will be for the account of the selling
stockholders, as described below. See "Selling Stockholders" and "Plan of
Distribution" described below.
THE ACQUISITION
On December 30, 1999, TWE entered into a Purchase Agreement (the
"Purchase Agreement"), with Queens Inner Unity Cable Systems ("Seller"), Mr.
Percy Sutton, Inner City Cable TV Systems, Inc. ("Inner City") and Framson,
Inc. to buy Seller's interest in Queens Inner Unity Cable System for
consideration that included 450,000 shares of Time Warner common stock. In
connection with the purchase of Seller's interest, Time Warner sold to TWE
450,000 shares of Time Warner common stock at its fair market value on January
21, 2000.
In connection with the Purchase Agreement, Time Warner entered into a
Registration Rights Agreement, dated as of December 30, 1999 (the
"Registration Rights Agreement"), with Inner City, pursuant to which certain
persons are entitled to certain registration rights with respect to the Time
Warner common stock issued in the Acquisition.
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SELLING STOCKHOLDERS
The following table sets forth as of the date of this prospectus, the
name of each of the selling stockholders, the nature of any position, office
or other material relationship that such selling stockholder and its
affiliates has had with Time Warner and its affiliates within the past three
years and the number of shares of Time Warner common stock which each such
selling stockholder owned as of such date. The table also sets forth the
number of shares of Time Warner common stock owned by each selling stockholder
that may be offered for sale from time to time by this prospectus and the
number of shares of Time Warner common stock to be held by each such selling
stockholder assuming the sale of all the common stock offered hereby. Time
Warner may amend or supplement this prospectus from time to time to disclose
the names, relationships to Time Warner and holdings of Time Warner common
stock of additional selling stockholders.
<TABLE>
<CAPTION>
Name and Relationship Number of Shares of Number of Shares of Number of Shares of
to Time Warner, if any Common Stock owned Common Stock which Common Stock owned
may be sold pursuant to assuming the sale of all
this prospectus of the shares offered
hereby
<S> <C> <C> <C>
Inner City 450,000 450,000 0
Broadcasting
Corporation 1
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</TABLE>
1 From December 11, 1987 until January 21, 2000, Seller, a New York joint
venture partnership in which Inner City, a New York corporation (or a
predecessor), held a 81.812% partnership interest, was a partner in a joint
venture partnership with TWE. As discussed above, Time Warner owns a 74.49%
partnership interest in TWE. Inner City is a wholly owned subsidiary of Inner
City Broadcasting Corporation.
On June 3, 1999 Urban Cableworks General, LLC wholly owned by Urban
Cableworks of Pennsylvania, LLC., and Urban Cableworks of Pennsylvania, LLC
which is a majority owned subsidiary of Inner City Broadcasting, entered into
a Limited Partnership Agreement, effective as of January 11, 2000, with Wade
Communications Partnership, which was then a partnership between two wholly
owned subsidiaries of Time Warner.
PLAN OF DISTRIBUTION
The selling stockholders named in this prospectus may offer Time Warner
common stock covered by this prospectus for sale from time to time, in a
manner consistent with the applicable provisions of the Registration Rights
Agreement. In accordance with those provisions, this prospectus covers sales
and other dispositions, other than underwritten fixed price offerings, on the
NYSE in block trades or other transactions described below.
The selling stockholders consist of certain persons who have acquired the
shares in connection with a sale of certain assets to TWE and that are
"Permitted Holders" under the Registration Rights Agreement.
The Time Warner common stock will be offered and sold at prices and on
terms then prevailing on the NYSE, at prices related to such prices or at
negotiated prices. The transactions covered by this prospectus consist of:
(a) block trades in which a broker-dealer engaged by a Permitted
Holder will attempt to sell the common stock as agent but may also
position and resell a portion of the block as principal to facilitate the
transaction;
(b) purchases by a broker-dealer as principal and resale by the
broker-dealer for its own account on the NYSE; and
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(c) ordinary brokerage transactions and transactions in which the
broker solicits purchasers.
This prospectus may be amended and supplemented from time to time to
describe the terms of a specific transaction.
Brokers, dealers or agents may receive compensation in the form of
commissions, discounts or concessions from Permitted Holders in amounts to be
negotiated in connection with sales made under this prospectus. To the extent
required by the Securities Act, this compensation, if any, will be disclosed
in a prospectus or prospectus supplement filed under the Securities Act. These
brokers or dealers and any other participating brokers or dealers may fall
under the Securities Act definition of "underwriters" in connection with such
sales and any commissions, discounts or concessions the Permitted Holders
provide to these brokers may fall under the Securities Act definition of
underwriting discounts or commissions.
Time Warner will pay certain costs, expenses and fees that may arise in
connection with the registration of the Time Warner common stock covered by
this prospectus. Notwithstanding the foregoing, the Permitted Holders will
bear the costs of selling concessions, commissions, discounts and transfer
taxes, if any, attributable to the sales of the Time Warner common stock. In
addition, the Permitted Holders will bear any costs of their legal counsel.
The Permitted Holders have agreed to indemnify Time Warner and any of its
respective affiliates, directors, officers and controlling persons, against
certain liabilities in connection with the offering of the Time Warner common
stock pursuant to this prospectus, including liabilities arising under the
Securities Act. In addition, Time Warner has agreed to indemnify the Permitted
Holders and any of their respective affiliates, directors, officers, trustees,
partners and controlling persons, and any of agent or investment advisor
thereof, against certain liabilities in connection with the offering of the
common stock pursuant to this prospectus, including liabilities arising under
the Securities Act.
Under the terms of the Registration Rights Agreement and in its sole
discretion exercised in good faith for any bona fide corporate reason, Time
Warner may determine at any time to suspend the availability of this
prospectus for use by the Permitted Holders.
LEGAL OPINION
Certain legal matters in connection with the Time Warner common stock
offered hereby were passed upon for Time Warner by Cravath, Swaine & Moore,
Worldwide Plaza, 825 Eighth Avenue, New York, New York 10019.
EXPERTS
Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements, schedule and supplementary information of Time Warner
and the consolidated financial statements and schedule of TWE included in Time
Warner's Annual Report on Form 10-K for the year ended December 31, 1999, as
set forth in their reports, which are incorporated herein by reference. These
consolidated financial statements, schedules and supplementary information are
incorporated by reference in reliance on Ernst & Young LLP's reports, given on
their authority as experts in accounting and auditing.
Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements of America Online, Inc. for the three years ended June
30, 1999 incorporated by reference as Exhibit 99 to its Quarterly Report on
Form 10-Q/A for the quarterly period ended March 31, 2000, as set forth in
their report, which is incorporated by reference in Time Warner's Current
Reports on Form 8-K dated January 10, 2000, March 31, 2000 and May 22, 2000,
which are incorporated herein by reference. These consolidated financial
statements are incorporated by reference in reliance on Ernst & Young LLP's
report, given on their authority as experts in accounting and auditing.
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