What is the primary purpose of this 8-K filing?

This 8-K filing reports the closing of AT&T's public offering of two series of preferred securities: Series B (€2 billion) and Series C ($1.75 billion). It details the terms and conditions under which these securities were issued and the associated agreements.

What are the implications of the Series B and Series C preferred stock on AT&T's common stock?

The Series B and Series C preferred stock have provisions that restrict AT&T's ability to declare or pay dividends on, or repurchase, its common stock if it fails to pay the full accrued dividends on these preferred securities. This prioritizes preferred shareholders' returns over common shareholders' in such scenarios.

How much capital did AT&T raise through these offerings?

AT&T raised a total of approximately €2 billion (equivalent in USD at the time of issuance) for the Series B preferred securities and $1.75 billion for the Series C preferred stock, representing a significant influx of capital.

Who were the underwriters for these offerings?

The Series B offering involved underwriters including Deutsche Bank AG, London Branch, Banco Santander, S.A., Barclays Bank PLC, and others. The Series C depositary shares offering was led by representatives such as Morgan Stanley & Co. LLC, Wells Fargo Securities, LLC, and BofA Securities, Inc., among others.

AT&T INC. 8-K: Shareholder Matters & Corporate Changes

Summary

AT&T Inc. (T) filed an 8-K on February 18, 2020, to report the closing of a significant public offering of preferred securities. The company issued €2,000,000,000 of Fixed Rate Reset Perpetual Preferred Securities, Series B, and $1,750,000,000 of 4.750% Perpetual Preferred Stock, Series C, structured as depositary shares. These issuances were made under an effective shelf registration statement, indicating AT&T's strategic move to raise capital through these instruments. The terms of these new preferred securities impose certain restrictions on AT&T's ability to pay dividends on or repurchase its common stock and other junior securities if full accrued dividends on the preferred shares are not met. This is a standard feature of preferred stock that ranks higher than common stock, designed to protect preferred shareholders' dividend rights. Investors should note that these issuances represent a substantial amount of preferred capital, which could impact the company's capital structure and future dividend capacity for common shareholders.

Key Highlights

1AT&T Inc. successfully closed a public offering of €2 billion of Series B Fixed Rate Reset Perpetual Preferred Securities.
2The company also raised $1.75 billion through the sale of Series C 4.750% Perpetual Preferred Stock, represented by depositary shares.
3Both issuances were conducted under an effective Form S-3 shelf registration statement.
4The terms of the Series B and Series C preferred securities include provisions that restrict AT&T's ability to pay common stock dividends or repurchase shares if preferred dividends are not fully paid.
5The company filed Certificates of Designations with the Secretary of State of Delaware to establish the specific rights and preferences of the Series B and Series C securities.
6Underwriting agreements with several major financial institutions were executed for these offerings.
7A Deposit Agreement was entered into with Computershare Inc. and Computershare Trust Company, N.A. for the Series C depositary shares.

AT&T INC. 8-K Report, Rights Modification (Feb 18, 2020)

Summary

Key Highlights

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