Exhibit 7(e)
Tele-Communications, Inc. Liberty Media Corporation
0000 XXX Xxxxxxx 0000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000 Xxxxxxxxx, Xxxxxxxx 00000
March 5, 1999
Xx. Xxxx X. Xxxxxx
Xx. Xxxxxx Xxxxxx
c/o Tele-Communications, Inc.
0000 XXX Xxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Dear Xxxx and Xxxxxx:
Reference is made to the Call Agreement, dated as of February 9, 1998
(the "Xxxxxx Call Agreement"), between Tele-Communications, Inc., a Delaware
corporation ("TCI"), and Xxxx X. Xxxxxx and Xxxxxx Xxxxxx (the "Malones").
Capitalized terms used but not expressly defined in this letter have the
meanings given to them in the Xxxxxx Call Agreement. Section references in this
letter are to Sections of the Xxxxxx Call Agreement.
The purpose of this letter is to confirm and clarify the following:
1. Each of the Malones consents to the assignment by TCI to Liberty
Ventures Group LLC, a Delaware limited liability company ("LVG"), and the
subsequent assignment by LVG to Liberty Media Corporation, a Delaware
corporation ("LMC"), of all of TCI's rights, interests and obligations under the
Xxxxxx Call Agreement, and agrees that upon such assignments TCI shall have no
further rights or obligations under the Xxxxxx Call Agreement. Each of the
Malones also agrees that if a Triggering Event (as defined below) occurs in the
future and is not waived, LMC may assign all of its rights, interests and
obligations under the Xxxxxx Call Agreement to Liberty Media Group LLC and, in
the event of such assignment, references to LMC herein shall thereafter refer to
Liberty Media Group LLC. "Triggering Event" has the meaning ascribed to such
term in the Contribution Agreement, being entered into on March 9, 1999, among
LMC, Liberty Media Management LLC, Liberty Media Group LLC and Liberty Ventures
Group LLC.
2. TCI and the Malones agree that if, for any reason, the Agreement
and Plan of Restructuring and Merger, dated as of June 23, 1998, as amended,
among TCI, AT&T Corp., a
New York corporation ("AT&T"), and Italy Merger Corp., a Delaware corporation
and a wholly owned subsidiary of AT&T ("MergerSub"), terminates without
consummation of the merger of MergerSub into TCI contemplated thereby (the
"Merger"), the assignments described in paragraph 1 shall be rescinded.
3. The Malones confirm and agree that TCI has exercised its right
under Section 7.9 of the Xxxxxx Call Agreement to require that, from and after
the Merger (and after giving effect to the assignments provided for above), the
Xxxxxx Call Agreement continue in effect in accordance with its terms and the
following:
a. References to the "Company" will be references to AT&T and any
successor (by merger, consolidation, sale, transfer, exchange, or otherwise) to
all or substantially all of its business and assets, except as indicated below:
i. in order to effectively give LMC the rights and obligations
it is intended to have after the assignments referred to in paragraph 1 above,
(x) the rights, interests, covenants and obligations of the "Company"
under the first sentence of Section 2.1 and under Sections 2.2
through 7.16, inclusive, will be rights, interests, covenants and
obligations of LMC and any successor (by merger, consolidation,
sale, transfer, exchange, or otherwise) to all or substantially
all of its business and assets (LMC or such successor being
referred to as "Liberty"), and
(y) references to the "Company" in the definitions of the terms
"Board of Directors" and "Xxxxxx Group" in Section 1.1 will be
references to Liberty;
ii. references to the Company with respect to covenants of the
Company that have been fully performed by TCI prior to the date hereof,
including, without limitation, in the second sentence of Section 2.1, shall
continue to refer to TCI, and
iii references to the Company in the definitions of Xxxxxxx
Call Agreement and Stockholders Agreement refer to TCI.
b. The definition of the term "High Vote Stock" shall mean the Class B
Liberty Media Group Common Stock, $1.00 par value per share, issued by AT&T (or
any successor referred to in paragraph 3(a) above), as it exists immediately
after the Merger, and any capital stock into which the Class B Liberty Media
Group Common Stock may thereafter be changed (whether as a result of a
recapitalization, reorganization, merger, consolidation, share exchange, stock
dividend, stock redemption, spinoff, split off or other transaction or event).
The definition of the term "Low Vote
-2-
Stock" shall mean the Class A Liberty Media Group Common Stock, $1.00 par value
per share, issued by AT&T (or any successor referred to in paragraph 3(a)
above), as it exists immediately after the Merger, and any capital stock into
which the Class A Liberty Media Group Common Stock may thereafter be changed
(whether as a result of a recapitalization, reorganization, merger,
consolidation, share exchange, stock dividend, stock redemption, spinoff, split
off or other transaction or event).
c. The term "Sale of the Company" shall mean a transaction which
results in a Change of Control of the issuer of the High Vote Stock (subject to
the same exclusions as currently pertain in the definition of such term).
d. In any case where the Holder has the right to elect under Section
2.2(d) to receive payment of the Gross Purchase Price for any High Vote Stock
included in the Subject Shares in shares of a corresponding series of Low Vote
Stock, and in any case where the Company has the right under Section 3.1 to
elect to pay all or any portion of the Closing Date Amount or Company Price in
shares of Low Vote Stock, such election will not be effective unless Liberty
arranges for AT&T to issue such Low Vote Stock and to grant to the selling
Holder the registration rights with respect to such shares of Low Vote Stock
contemplated by Section 2.2(e). Similarly, the Company's election under Section
3.1 will not be effective unless Liberty arranges for AT&T to comply with
Section 3.2.
If the foregoing accurately expresses our understanding, please sign
and return the enclosed counterpart of this letter.
Sincerely,
TELE-COMMUNICATIONS, INC.
By:
----------------------------
Xxxxxxx X. Xxxxx
Executive Vice President,
Secretary and General Counsel
-3-
LIBERTY VENTURES GROUP LLC
By:
----------------------------
Xxxxxxx X. Xxxxx
Vice President
LIBERTY MEDIA CORPORATION
By:
----------------------------
Xxxxxxx X. Xxxxx
Vice President
Confirmed:
-----------------------------
XXXX X. XXXXXX
-----------------------------
XXXXXX XXXXXX
-4-
