AT&T INC. ITEM 8.01 Other Events.
On
Pursuant to, and subject to the terms and conditions set forth in, the
Contribution Agreement, among other matters, Services contributed the
The foregoing summary of the Contribution Agreement does not purport to be
complete and is qualified in its entirety by the full text of the Contribution
Agreement, which was filed as Exhibit 10.1 to the Company's Current Report on
Form 8-K on
On
ITEM 1.01 Entry into a Material Definitive Agreement.
At the Closing, AT&T HoldCo, Investor and New DTV entered into the Amended and
Restated Limited Liability Company Agreement of New DTV, dated
• first, Investor, as the holder of New DTV Senior Preferred Interests,
will be entitled to receive a cash return of 10% per annum on the
unreturned portion of its contribution of approximately $1.8 billion in
cash in respect of its New DTV Senior Preferred Interests;
• second, Investor, as the holder of New DTV Senior Preferred Interests,
will be entitled to $1.8 billion of distributions in respect of its New
DTV Senior Preferred Interests;
• third, AT&T HoldCo, as the holder of New DTV Junior Preferred Interests,
will be entitled to a cash return of 6.5% per annum on the unreturned
portion of its $4.25 billion contribution in respect of its New DTV
Junior Preferred Interests, which will be paid-in-kind until the
distributions to the holders of New DTV Senior Preferred Interests are
paid in full;
• fourth, AT&T HoldCo, as the holder of New DTV Junior Preferred Interests,
will be entitled to $4.25 billion of distributions in respect of its New
DTV Junior Preferred Interests;
• fifth, AT&T HoldCo, as the holder of New DTV Common Catch-Up Interests,
will be entitled to $4.2 billion of distributions in respect of its New
DTV Common Catch-Up Interests; and
• sixth, AT&T HoldCo and Investor, as holders of New DTV Common Interests,
will be entitled to any distributions pro rata on their ownership of New
DTV Common Interests.
AT&T HoldCo and Investor, as holders of interests in New DTV, will be entitled to receive tax distributions based on an assumed allocation of taxable income, subject to certain specified adjustments and calculated assuming a tax rate equal to the combined highest marginal income tax rate for any particular line item. The New DTV Operating Agreement, provides that New DTV will be jointly governed by a board comprised of two managers designated by AT&T HoldCo, two managers appointed by Investor and the Chief Executive Officer of New DTV. Under the terms of the New DTV Operating Agreement, Investor, subject to certain limitations, has the initial sole right to compel certain dispositions of New DTV securities and assets and after a period, either Investor or AT&T HoldCo, subject to certain limitations, may compel the same dispositions.
The foregoing summary of the New DTV Operating Agreement does not purport to be complete and is qualified in its entirety by the full text of the New DTV Operating Agreement, which is attached hereto as Exhibit 10.1, and is incorporated herein by reference.
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The New DTV Operating Agreement has been included to provide investors with information regarding its terms. It is not intended to provide any other factual information about the Company, Investor, their respective subsidiaries or affiliates. The representations, warranties and covenants contained in the New DTV Operating Agreement were made only for purposes of the New DTV Operating Agreement, respectively, and as of specific dates, were solely for the benefit of the parties to the New DTV Operating Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the New DTV Operating Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the New DTV Operating Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of representations and warranties may change after the date of the New DTV Operating Agreement, which subsequent information may or may not be fully reflected in the Company's public disclosures.
CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS
Information set forth in this filing contains forward-looking statements that
are subject to risks and uncertainties, including statements relating to the
transaction. A discussion of factors that may affect future results is contained
in the Company's filings with the
The Company disclaims any obligation to update or revise statements contained in this filing based on new information or otherwise.
ITEM 9.01 Financial Statements and Exhibits.
(d) Exhibits
10.1 Amended and Restated Limited Liability Company Agreement of DIRECTV
Entertainment Holdings LLC , dated July 31, 2021 , among AT&T Holdco,
Investor and New DTV
99.1 Press Release, dated August 2, 2021 , jointly issued by the Company and
Investor
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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