Bank of China (New York Branch) contributes to debt rescheduling — via a 0.778-year maturity extension — of a $7.35 billion USD portion of a $14.7 billion USD syndicated loan to AT&T Inc. for general corporate purposes

Project narrative

On January 29, 2021, a syndicate of 31 banks — including the New York Branch of the Bank of China (BOC) and the New York Branch of the Industrial and Commercial Bank of China (ICBC) — entered into a $14,700,000,000 USD syndicated senior unsecured delayed draw term loan agreement with AT&T Inc. — a Delaware-incorporated American multinational telecommunications holding company headquartered in Dallas, Texas and listed on the New York Stock Exchange — for general corporate purposes. The loan carried a maturity period of 364 days from the day of borrowing. The loan was available for a single draw at any time until May 29, 2021. Borrowings under the term loan carried a variable interest rate based on, at the borrower's discretion, an annual base rate (the highest of the prime rate quoted by The Wall Street Journal, 0.50% per annum above the Federal Funds Rate, and one-month USD LIBOR plus 1.00%), or LIBOR for a period of one, two, three or six months, plus an applicable margin. The LIBOR margin would equal 0.625%, 0.875%, 1.000%, or 1.125% per annum depending on AT&T's senior unsecured long-term debt ratings, while the base rate would be the greater of 0.00% or the LIBOR margin minus 1.00%. Beginning March 30, 2021, the borrower was obligated to pay a commitment fee of 0.070%, 0.080%, 0.100%, or 0.125% per annum of the amount of lender commitments, depending on AT&T's credit rating. If the borrower's unsecured long-term debt ratings were split by S&P, Moody’s and Fitch, the margin and fee would be determined by the highest of the three, except when when the lowest was more than one below, it which case it would be one level above the lowest rating. At the time of signing, AT&T's unsecured long-term debt was rated BBB by S&P, Baa2 by Moody’s and A- by Fitch, making the LIBOR margin 1.000%, the base rate margin 0.000%, and the commitment fee 0.100%. The term loan carried a financial ratio covenant requiring AT&T to maintain, beginning the fiscal quarter ending June 30, 2021, a net debt-to-earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio of not more than 3.5 to 1 of: a) all items that would be treated under accounting principles generally accepted in the United States (GAAP) as indebtedness on AT&T's consolidated balance sheet to b) the net income of AT&T and its consolidated subsidiaries, determined on a consolidated basis for the four quarters then ended in accordance with GAAP, with adjustments. Events of default would result in the possibility of acceleration of required payment and increase the margin by 2.00% per annum. Record ID#108012 captures BOC's contribution. Record ID#108013 captures ICBC's contribution. In addition to BOC and ICBC, the following lenders contributed to the loan syndicate: Bank of America, N.A., Barclays Bank PLC, Citibank, N.A., the New York Branch of Deutsche Bank AG, JPMorgan Chase Bank, N.A., Mizuho Bank, Ltd., Wells Fargo Bank, National Association, the New York Branch of Banco Bilbao Vizcaya Argentaria, S.A. (BBVA), BNP Paribas S.A., the New York Branch of Commerzbank AG, the New York Branch of Credit Suisse AG, Goldman Sachs Bank USA, HSBC Bank USA, N.A., Morgan Stanley Bank, N.A., MUFG Bank, Ltd., Royal Bank of Canada (RBC), Santander Bank, N.A., Société Générale S.A. (SocGen), Sumitomo Mitsui Banking Corporation (SMBC), The Bank of Nova Scotia (Scotiabank), the New York Branch of The Toronto-Dominion Bank, the New York Branch of Intesa Sanpaolo S.p.A., Standard Chartered Bank plc, Truist Bank, U.S. Bank National Association, Australia and New Zealand Banking Group Limited (ANZ), the New York Branch of Canadian Imperial Bank of Commerce (CIBC), Regions Bank, and The Bank of New York Mellon. BofA Securities, Inc. served as global coordinator, joint bookrunner, and joint lead arranger. Citibank served as sole syndication agent, joint bookrunner, and joint lead arranger. Barclays Bank, Deutsche Bank Securities Inc., JPMorgan Chase Bank, Mizuho Bank, and Wells Fargo Securities, LLC served as joint lead arrangers and joint bookrunners. The proceeds were to be used for general corporate purposes of the borrower and its subsidiaries, which could include among other things, financing acquisitions of additional spectrum. On March 23, 2021, the borrower drew down $7.350 billion USD of the loan and terminated the other $7.350 billion USD of commitments, with the loan to be due on March 22, 2022. On June 4, 2021, the lending syndicate entered into an amendment agreement with the borrower for the term loan; the amended carved out DIRECTV Entertainment Holdings LLC (and its subsidiaries after the closing of the transaction, permitted certain liens that may be incurred in connection with the that transaction, and amended the net debt-to-EBITDA financial ratio from 3.5 to 1.0 to 4.0 to 1.0. In the first quarter of 2022, the lending syndicate entered into an another amendment agreement with the borrower for the term loan; in the amendment, the lenders extended the maturity period of the loan by approximately 0.778 years — for a new maturity period of 1.778 years — to December 31, 2022. Record ID#108014 captures BOC's contribution to this debt rescheduling. Record ID#108015 captures ICBC's contribution to this debt rescheduling. On April 13, 2022, the borrower paid off the loan and then terminated it.