UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): October 4, 2004
BELLSOUTH CORPORATION
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(Exact Name of Registrant as Specified in Its Charter)
GEORGIA
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(State or Other Jurisdiction of Incorporation)
1-8607 58-1533433
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(Commission File Number) (IRS Employer Identification No.)
Room 15G03, 1155 Peachtree Street, N. E., Atlanta, Georgia 30309-3610
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(Address of Principal Executive Offices) (Zip Code)
(404) 249-2000
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On October 4, 2004, BellSouth Corporation entered into a Credit
Agreement (the "Agreement") with JPMorgan Chase Bank, Lehman Commercial Paper
Inc., Citibank, N.A., Goldman Sachs Credit Partners L.P., Morgan Stanley Bank,
Morgan Stanley Senior Funding, Inc. and The Royal Bank of Scotland plc, as
Lenders, and JPMorgan Chase Bank, as Administrative Agent. The Agreement
provides for commitments in the aggregate principal amount of $9 billion and
matures on October 3, 2005.
Along with a separate credit agreement that provides the Company with
commitments in the aggregate principal amount of $1.5 billion, the Agreement
acts as a backup facility for the Company's $10.5 billion commercial paper
program. In addition, loans made pursuant to the Agreement may be used to make
capital contributions to Cingular Wireless Corporation ("Cingular") to finance
BellSouth's portion of the cost of the pending acquisition by Cingular of AT&T
Wireless Services, Inc. (the "Acquisition"). The proceeds of any commercial
paper backstopped by the Agreement will be placed in escrow until the
Acquisition is consummated.
The Agreement provides that the commitments reduce over time as
follows:
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Date of Commitment Reduction Amount
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A. Thirty days after consummation of the $1,500,000,000
Acquisition
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B. The second business day following the The amount of such net cash
date of any receipt of net cash proceeds from such sale up
proceeds (as defined in the Agreement) to an aggregate of
pursuant to the Company's agreement to $3,500,000,000
sell its Latin American operations to
Telefonica Moviles
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C. The second business day following (i) The amount of such funded
the incurrence of any funded debt (as debt or the net proceeds of
defined in the Agreement) and (ii) such issuance of such equity
the issuance of any equity securities securities
other than pursuant to certain plans
described in the Agreement
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D. December 31, 2004 $3,200,000,000 less any
reductions in commitments
caused by (B) above and any
voluntary reductions in
commitments.
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E. April 29, 2005 $1,300,000,000 less any
reductions in commitments
caused by (B) above and any
voluntary reductions in
commitments, in either case
only to the extent not
applied pursuant to (D)
above
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F. October 3, 2005 Any remaining commitments
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Except as described in this paragraph, the Agreement contains no
financial covenants or requirements for compensating balances. Further, the
Agreement does not contain any provisions that are tied to the ratings assigned
to us or our affiliates. At the Company's election, any outstanding borrowings
may be converted to a one-year term loan, in which case the debt of the Company
and its consolidated subsidiaries is not permitted, as of the end of any fiscal
quarter, to exceed 300% of consolidated earnings before interest, taxes,
depreciation and amortization for the preceding four quarters.
The Agreement prohibits the Company and its significant subsidiaries
from permitting liens to be placed on their properties or assets except in
specified circumstances. If BellSouth or any of its subsidiaries, except for its
Latin American entities, defaults on any outstanding debt in excess of $200
million, and such default results in the acceleration of such debt, then that
acceleration will cause an event of default to occur under the Agreement. If we
borrow funds under this Agreement, the same event of default clause will become
applicable to certain of BellSouth's Latin American credit facilities. The
Agreement also provides that, unless waived by the banks, an event of default
shall occur if the Acquisition shall not have been consummated on or before
November 18, 2004.
A copy of the Agreement is attached as Exhibit 10xx to this Current
Report on Form 8-K.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
The information provide in Item 1.01 of this Current Report on Form 8-K
is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
10xx Credit Agreement dated as of October 4, 2004 among BellSouth
Corporation, the Lenders Party Thereto and JPMorgan Chase Bank, As
Administrative Agent
SIGNATURE
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.
BELLSOUTH CORPORATION
By: /s/ W. Patrick Shannon
W. Patrick Shannon
Vice President - Finance
October 6, 2004