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|LIBERTY BROADBAND CORP filed this Form SC 13D/A on 06/01/2015|
Item 3. Source and Amount of Funds or Other Consideration.
The information contained in Item 3 of the Schedule 13D is hereby amended and supplemented by adding the following information:
On May 23, 2015, the Reporting Person entered into an Investment Agreement with the Issuer and New Charter (the Charter Investment Agreement), as further described in Item 6. Pursuant to the terms of the Charter Investment Agreement, on the Closing Date, immediately following the closing of the Parent Merger, subject to the satisfaction of certain conditions to closing, as further described in Item 6, the Reporting Person will acquire New Charter Shares from New Charter at a price per share of $176.95 (as adjusted by the applicable exchange ratio) (the New Charter Investment) for an aggregate purchase price of $4.3 billion (the Purchase Price). The Issuer intends to seek the approval of its stockholders for the issuance of the New Charter Shares in accordance with its organizational documents and the rules of the Nasdaq Stock Market (Nasdaq).
The Reporting Person currently intends to pay all or a portion of the Purchase Price for the New Charter Investment using the proceeds from certain Amended and Restated Investment Agreements (the Investment Agreements) entered into with Liberty Interactive Corporation (LIC), JANA Nirvana Master Fund, L.P. (JANA Nirvana), JANA Master Fund, Ltd. (JANA Master), Coatue Offshore Master Fund, Ltd. (Coatue), Quantum Partners LP (Quantum Partners), Soroban Master Fund LP (Soroban Master Fund) and Soroban Opportunities Master Fund LP (Soroban Opportunities Master Fund and together with LIC, JANA Nirvana, JANA Master, Coatue, Quantum Partners and Soroban Master Fund, the Investors) and an Amended and Restated Assignment and Assumption of Investment Agreement among the Reporting Person, LIC, Soroban Master Fund and Soroban Opportunities Master Fund (the Assignment), pursuant to which LIC assigned a portion of its original investment to Soroban Master Fund and Soroban Opportunities Master Fund. Pursuant to the Investor Agreements and the Assignment, subject to the satisfaction of certain conditions (including the satisfaction of each of the closing conditions set forth in the Mergers Agreement and the closing of the transactions contemplated by the Charter Investment Agreement), the Investors will subscribe for newly issued shares of Libertys Series C common stock (the Liberty Series C Shares), at a price of $56.23 per share and an aggregate purchase price of $4.4 billion (the Liberty Investment). Each of the Investment Agreements contains substantially similar terms and conditions, including customary registration rights (or an agreement to enter into a customary registration rights agreement prior to closing), indemnification provisions and an agreement by the Reporting Person to use the consideration paid pursuant to the Investment Agreements for the New Charter Investment. The Reporting Person will seek stockholder approval for the issuance of the Liberty Series C Shares pursuant to the Investment Agreements and the Assignment, in accordance with the rules and requirements of Nasdaq. If the Reporting Person does not receive the requisite stockholder approval for the issuance of the Liberty Series C Shares, the Investors, on a pro rata basis, will instead acquire Liberty Series C Shares representing not more than 19.9% of the outstanding common stock of the Reporting Person and shares of a newly issued series of non-convertible preferred stock of the Reporting Person. In addition, the Reporting Person, in its sole discretion, may determine to obtain a portion of the financing it needs to complete the New Charter Investment through the incurrence of indebtedness and other non-equity financing sources, which the Reporting Persons board of directors, in its reasonable judgment, has determined provides the Reporting Person with a superior alternative. In such event, each Investors applicable portion of the Liberty Investment will be reduced, pro rata, by an amount not to exceed 25% of its investment. The Investment Agreements contain customary termination events, including, but not limited to, (i) as to any Investor, a breach of any representation or warranty or failure to perform a covenant by such Investor which has not been cured and would cause the conditions to closing not to be satisfied, (ii) as to any Investor, if the Closing Date has not occurred within two years of the date of the Mergers Agreement, (iii) as to any Investor, within fifteen days following an amendment, modification or waiver of any provision of the Mergers Agreement that is adverse in any material respect to the Reporting Person and to which the Reporting Person has consented, (iv) as to any Investor, upon the entry of an order by a government entity of competent jurisdiction against any Investor relating to the Liberty Investment or the transactions contemplated by the Charter Investment Agreement, and (v) the termination of the Mergers Agreement.
Separately, pursuant to the terms of the Second Amended and Restated Stockholders Agreement, upon the closing of the Bright House Transactions (the Bright House Closing), the Reporting Person has agreed to purchase from New Charter an additional $700 million of New Charter Shares at a price per share of $172.99 (as adjusted by the applicable exchange ratio) (the Reference Price). See Item 6. The Reporting Person currently intends to pay the aggregate purchase price for such additional New Charter Shares using the proceeds of the rights offering