Paramount Skydance Corp 8-K

What Happened

• On April 7, 2026, Paramount Skydance Corp (PSKY) announced a Pro Rata Credit Agreement providing $10.0 billion of senior secured facilities to support the proposed acquisition of WBD: $2.50B three‑year Term A-1, $2.50B five‑year Term A-2, and a $5.00B five‑year revolving facility. The agreement replaces and reduces earlier bridge commitments (previously $54.0B bridge and $3.5B 365‑day revolver under a December 8, 2025 commitment letter) to $49.0B and $0.0B, respectively, in connection with this financing.
• On April 7, 2026 PSKY also entered Amendment No. 7 to its existing revolving credit agreement, increasing that unsecured revolver from $3.50B to $5.00B (to be reduced to $4.94B in Jan 2027 through maturity in Jan 2028).
• On April 8, 2026, PSKY and Paramount Global executed a Separation Agreement with Jeffrey Shell, PSKY’s President and board member, effective April 8, 2026; Mr. Shell ceased employment and board service.

Key Details

• Credit structure: $2.5B (3‑yr Term A‑1) + $2.5B (5‑yr Term A‑2) + $5.0B (5‑yr revolver) — proceeds intended to help finance the WBD transaction and general corporate purposes.
• Security and ratings: Obligations are first‑lien secured on substantially all U.S. guarantor assets until an “Investment Grade Fall‑Away Date” (if PSKY attains specified credit ratings, obligations become unsecured and guarantees released).
• Financial covenants: consolidated total net leverage ≤ 5.50x and first‑lien net leverage ≤ 3.25x each quarter (after Investment Grade Fall‑Away Date, first‑lien covenant drops and consolidated covenant tightens to ≤ 4.50x).
• Separation terms for Jeffrey Shell: cash equal to his annual base salary plus target bonus paid over 12 months (subject to release and restrictive covenants), accelerated vesting of RSUs that would have vested within 12 months, and up to 12 months of company‑subsidized health/dental coverage.

Why It Matters

• The Pro Rata Credit Agreement provides committed financing that directly supports PSKY’s planned acquisition of WBD and reduces reliance on earlier bridge commitments. The size, secured nature of the loans, and quarterly leverage covenants will affect PSKY’s capital structure, liquidity flexibility and ability to incur additional debt until conditions (including any Investment Grade Fall‑Away) are met.
• The amendment increasing the existing unsecured revolver expands short‑term liquidity available to PSKY. Investors should note the loans bear variable interest (Term SOFR or U.S. prime plus margins tied to PSKY’s rating) and include customary fees and prepayment features.
• The departure of President Jeffrey Shell is a material leadership change; the separation package (cash, RSU acceleration, benefits) aims to reduce turnover risk and preserve continuity, but investors should monitor management execution and any further governance changes as the WBD transaction progresses.