8-KMaterial AgreementsFinancial EventsExhibits & Filings

Warner Bros. Discovery, Inc. 8-K Report, Material Agreement (Oct 15, 2010)

Filed October 15, 2010For Securities:WBD

Summary

Warner Bros. Discovery, Inc. (WBD), then operating as Discovery Communications, Inc., filed an 8-K on October 15, 2010, to report the entry into a new $1 billion multicurrency revolving senior credit facility. This facility, with an option to expand by an additional $1 billion, is intended to support working capital, capital expenditures, and other general corporate purposes. The new credit facility replaces a previous agreement and demonstrates the company's proactive approach to managing its liquidity and financial flexibility. The terms include varying interest rates based on credit ratings, a facility fee, and various covenants, including financial ratio requirements (interest coverage and leverage). The company also reported the termination of its prior credit agreement dated July 14, 2004.

Key Highlights

  • 1Discovery Communications, Inc. (now WBD) entered into a $1 billion multicurrency revolving senior credit facility on October 13, 2010.
  • 2The new facility has an expansion option for an additional $1 billion, bringing the potential total to $2 billion.
  • 3Proceeds from the credit facility are designated for working capital, capital expenditures, and other lawful corporate purposes.
  • 4Interest rates on the facility vary based on the company's credit ratings, ranging from 107.5 to 185.0 basis points for Eurocurrency loans.
  • 5The facility includes covenants such as a minimum consolidated interest coverage ratio of 3.00:1.00 and a maximum consolidated leverage ratio of 4.50:1.00.
  • 6The company terminated its previous credit agreement dated July 14, 2004, in conjunction with establishing the new facility.
  • 7The new credit facility matures on October 11, 2013.

Frequently Asked Questions

The new $1 billion multicurrency revolving senior credit facility is intended to provide funding for working capital needs, capital expenditures, and other general corporate purposes of Discovery Communications, LLC (the borrower).

The initial credit facility is for $1 billion, but it includes an expansion option that allows the borrower to request an additional $1 billion, potentially bringing the total available credit to $2 billion.

Yes, the credit agreement requires Discovery Communications to maintain a consolidated interest coverage ratio of no less than 3.00 to 1.00 and a consolidated leverage ratio of no more than 4.50 to 1.00. These are key metrics investors monitor to assess financial health and debt management.

The senior credit facility is available on a revolving basis until October 11, 2013.