AMENDMENT NO. 2 TO RIGHTS AGREEMENT
This AMENDMENT NO. 2 TO RIGHTS AGREEMENT (this "Amendment") is
being entered into as of May 28, 1999 between The Associated Group, Inc., a
Delaware corporation (the "Company"), and ChaseMellon Shareholder Services,
L.L.C. (successor to Mellon Bank, N.A.) as rights agent (the "Rights Agent").
The Company and the Rights Agent are parties to a Rights
Agreement dated as of December 14, 1994, as heretofore amended by an Amendment
No. 1 thereto dated as of March 17, 1999 (as so amended, the "Rights
Agreement").
It is proposed that the Company enter into an Agreement and
Plan of Merger (the "Merger Agreement") by and among the Company, AT&T Corp., a
New York corporation (the "Parent"), Liberty Media Corporation, a Delaware
corporation ("Liberty"), and A-Group Merger Corp., a Delaware corporation and a
wholly owned subsidiary of Parent (the "Merger Subsidiary"), pursuant to which
the Merger Subsidiary will merge with and into the Company (the "Merger"), and
that Parent, Liberty and certain stockholders of the Company enter into a Voting
Agreement (the "Voting Agreement"), pursuant to which such stockholders agree to
vote certain of their shares of Common Stock of the Company in the manner
provided in the Voting Agreement.
Pursuant to Section 26 of the Rights Agreement, the Company
and the Rights Agent may supplement or amend the Rights Agreement in accordance
with the provisions of Section 26 thereof. The Company now desires to amend the
Rights Agreement as set forth in this Amendment and deems such amendments to be
necessary and desirable. Capitalized terms used but not defined herein shall
have the meanings ascribed to such terms in the Rights Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual agreement herein set forth, the parties hereby agree as follows:
1. AMENDMENT OF SECTION 1(a). Section 1(a) of the Rights
Agreement is hereby amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the
contrary, none of AT&T, Liberty or any of their existing or
future Affiliates or Associates shall be deemed to be an
Acquiring Person solely
by virtue of (i) the execution of the Merger Agreement or the
Voting Agreement, (ii) the acquisition of Common Stock or
other capital stock of the Company pursuant to the Merger
Agreement or the consummation of the Merger, (iii) the
consummation of the other transactions contemplated by the
Merger Agreement or the Voting Agreement, (iv) the acquisition
of beneficial ownership (which acquisition is in addition to
and not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by AT&T or its Affiliates or Associates (excluding Liberty and
its Affiliates and Associates) of not more than an additional
10.0% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2 Effective
Time, (v) the acquisition of beneficial ownership (which
acquisition is in addition to and not pursuant to or in
contemplation of the agreements or events referred to in the
preceding clauses (i) through (iii)) by Liberty or its
Affiliates or Associates (excluding AT&T and its Affiliates
and Associates) of not more than an additional 4.9% of the
total number of shares of Company Common Stock outstanding
immediately prior to the Amendment No. 2 Effective Time or
(vi) any combination of the foregoing."
2. AMENDMENT OF SECTION 1(d). Section 1(d) of the Rights
Agreement is hereby amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the
contrary, none of AT&T, Liberty or any of their existing or
future Affiliates or Associates shall be deemed to be an
Adverse Person solely by virtue of (i) the execution of the
Merger Agreement or the Voting Agreement, (ii) the
acquisition of Common Stock or other capital stock of the
Company pursuant to the Merger Agreement or the consummation
of the Merger, (iii) the consummation of the other
transactions contemplated by the Merger Agreement or the
Voting Agreement, (iv) the acquisition of beneficial ownership
(which acquisition is in addition to and not pursuant to or
in contemplation of the agreements or events referred to in
the preceding clauses (i) through (iii)) by AT&T or its
Affiliates or Associates (excluding Liberty and its Affiliates
and Associates) of not more than an additional 10.0% of the
total number of shares of
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Company Common Stock outstanding immediately prior to the
Amendment No. 2 Effective Time, (v) the acquisition of
beneficial ownership (which acquisition is in addition to and
not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by Liberty or its Affiliates or Associates (excluding AT&T and
its Affiliates and Associates) of not more than an additional
4.9% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2 Effective
Time or (vi) any combination of the foregoing."
3. AMENDMENT OF SECTION 1(e). Section 1(e) of the Rights
Agreement is hereby amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the
contrary, an Adverse Person Event shall not be deemed to have
occurred solely by virtue of (i) the execution of the Merger
Agreement or the Voting Agreement, (ii) the acquisition of
Common Stock or other capital stock of the Company pursuant
to the Merger Agreement or the consummation of the Merger,
(iii) the consummation of the other transactions contemplated
by the Merger Agreement or the Voting Agreement, (iv) the
acquisition of beneficial ownership (which acquisition is in
addition to and not pursuant to or in contemplation of the
agreements or events referred to in the preceding clauses (i)
through (iii)) by AT&T or its Affiliates or Associates
(excluding Liberty and its Affiliates and Associates) of not
more than an additional 10.0% of the total number of shares of
Company Common Stock outstanding immediately prior to the
Amendment No. 2 Effective Time, (v) the acquisition of
beneficial ownership (which acquisition is in addition to and
not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by Liberty or its Affiliates or Associates (excluding AT&T and
its Affiliates and Associates) of not more than an additional
4.9% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2
Effective Time or (vi) any combination of the foregoing."
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4. AMENDMENT OF SECTION 1(ww). Section 1(ww) of the Rights
Agreement is hereby amended to add the following proviso at the end thereof:
"; provided, however, that no Triggering Event shall result
solely by virtue of (i) the execution of the Merger Agreement
or the Voting Agreement, (ii) the acquisition of Common Stock
or other capital stock of the Company pursuant to the Merger
Agreement or the consummation of the Merger, (iii) the
consummation of the other transactions contemplated by the
Merger Agreement or the Voting Agreement, (iv) the acquisition
of beneficial ownership (which acquisition is in addition to
and not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by AT&T or its Affiliates or Associates (excluding Liberty and
its Affiliates and Associates) of not more than an additional
10.0% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2
Effective Time, (v) the acquisition of beneficial ownership
(which acquisition is in addition to and not pursuant to or in
contemplation of the agreements or events referred to in the
preceding clauses (i) through (iii)) by Liberty or its
Affiliates or Associates (excluding AT&T and its Affiliates
and Associates) of not more than an additional 4.9% of the
total number of shares of Company Common Stock outstanding
immediately prior to the Amendment No. 2 Effective Time or
(vi) any combination of the foregoing."
5. AMENDMENT OF SECTION 1. Section 1 of the Rights Agreement
is hereby further amended to add the following subparagraphs at the end thereof:
(xx) "Amendment No. 2" shall mean the Amendment
No. 2 to Rights Agreement dated May 28, 1999, by and between
the Company and the Rights Agent.
(yy) "Amendment No. 2 Effective Time" shall mean the
date and time the Amendment No. 2 is fully executed.
(zz) "AT&T" shall mean AT&T Corp., a New York
corporation.
(aaa) "Liberty" shall mean Liberty Media
Corporation, a Delaware corporation.
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(bbb) "Merger" shall have the meaning set forth in
the Merger Agreement.
(ccc) "Merger Agreement" shall have the meaning set
forth in Section 35 hereof.
(ddd) "Merger Agreement Termination Time" shall mean
the later of (i) the date and time of termination of the
Merger Agreement or (ii) the date and time of termination of
the Voting Agreement.
(eee) "Merger Subsidiary" shall have the meaning set
forth in Section 35 hereof.
(fff) "Voting Agreement" shall mean the Voting
Agreement of even date with the Amendment No. 2, to be entered
into following the Amendment No. 2 Effective Time, by and
between AT&T, Liberty and the stockholders of the Company
listed as parties thereto.
6. AMENDMENT OF SECTION 3(a). Section 3(a) of the Rights
Agreement is hereby amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the
contrary, a Distribution Date shall not be deemed to have
occurred solely by virtue of (i) the execution of the Merger
Agreement or the Voting Agreement, (ii) the acquisition of
Common Stock or other capital stock of the Company pursuant
to the Merger Agreement or the consummation of the Merger,
(iii) the consummation of the other transactions contemplated
by the Merger Agreement or the Voting Agreement, (iv) the
acquisition of beneficial ownership (which acquisition is in
addition to and not pursuant to or in contemplation of the
agreements or events referred to in the preceding clauses (i)
through (iii)) by AT&T or its Affiliates or Associates
(excluding Liberty and its Affiliates and Associates) of not
more than an additional 10.0% of the total number of shares of
Company Common Stock outstanding immediately prior to the
Amendment No. 2 Effective Time, (v) the acquisition of
beneficial ownership (which acquisition is in addition to and
not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by Liberty or its Affiliates or Associates (excluding AT&T and
its Affiliates and Associates)
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of not more than an additional 4.9% of the total number of
shares of Company Common Stock outstanding immediately prior
to the Amendment No. 2 Effective Time or (vi) any combination
of the foregoing."
7. AMENDMENT OF SECTION 7(a). Section 7(a) of the Rights
Agreement is amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the
contrary, none of (i) the execution of the Merger Agreement or
the Voting Agreement, (ii) the acquisition of Common Stock or
other capital stock of the Company pursuant to the Merger
Agreement or the consummation of the Merger, (iii) the
consummation of the other transactions contemplated by the
Merger Agreement or the Voting Agreement, (iv) the acquisition
of beneficial ownership (which acquisition is in addition to
and not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by AT&T or its Affiliates or Associates (excluding Liberty and
its Affiliates and Associates) of not more than an additional
10.0% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2 Effective
Time, (v) the acquisition of beneficial ownership (which
acquisition is in addition to and not pursuant to or in
contemplation of the agreements or events referred to in the
preceding clauses (i) through (iii)) by Liberty or its
Affiliates or Associates (excluding AT&T and its Affiliates
and Associates) of not more than an additional 4.9% of the
total number of shares of Company Common Stock outstanding
immediately prior to the Amendment No. 2 Effective Time or
(vi) any combination of the foregoing, shall constitute an
event that would cause the Rights to become exercisable
pursuant to the provisions of this Section 7 or otherwise."
8. AMENDMENT OF SECTION 11. Section 11 of the Rights
Agreement is amended to add the following sentence after the first sentence of
said Section:
"Notwithstanding anything in this Rights Agreement to the
contrary, none of (i) the execution of the Merger Agreement or
the Voting Agreement, (ii) the acquisition of Common Stock or
other capital stock of the Company pursuant to the Merger
Agreement or the consummation of the Merger, (iii) the
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consummation of the other transactions contemplated by the
Merger Agreement or the Voting Agreement, (iv) the acquisition
of beneficial ownership (which acquisition is in addition to
and not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by AT&T or its Affiliates or Associates (excluding Liberty
and its Affiliates and Associates) of not more than an
additional 10.0% of the total number of shares of Company
Common Stock outstanding immediately prior to the Amendment
No. 2 Effective Time, (v) the acquisition of beneficial
ownership (which acquisition is in addition to and not
pursuant to or in contemplation of the agreements or events
referred to in the preceding clauses (i) through (iii)) by
Liberty or its Affiliates or Associates (excluding AT&T and
its Affiliates and Associates) of not more than an additional
4.9% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2 Effective
Time or (vi) any combination of the foregoing, shall
constitute an event of the type described in this Section 11,
including without limitation, a Section 11(a)(ii) Event, or be
deemed to cause the Rights to be adjusted or to become
exercisable in accordance with this Section 11 or otherwise."
9. AMENDMENT OF SECTION 13(d). Section 13(d) of the Rights
Agreement is amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the
contrary, none of (i) the execution of the Merger Agreement or
the Voting Agreement, (ii) the acquisition of Common Stock or
other capital stock of the Company pursuant to the Merger
Agreement or the consummation of the Merger, (iii) the
consummation of the other transactions contemplated by the
Merger Agreement or the Voting Agreement, (iv) the acquisition
of beneficial ownership (which acquisition is in addition to
and not pursuant to or in contemplation of the agreements or
events referred to in the preceding clauses (i) through (iii))
by AT&T or its Affiliates or Associates (excluding Liberty and
its Affiliates and Associates) of not more than an additional
10.0% of the total number of shares of Company Common Stock
outstanding immediately prior to the Amendment No. 2 Effective
Time, (v) the acquisition of beneficial ownership (which
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acquisition is in addition to and not pursuant to or in
contemplation of the agreements or events referred to in the
preceding clauses (i) through (iii)) by Liberty or its
Affiliates or Associates (excluding AT&T and its Affiliates
and Associates) of not more than an additional 4.9% of the
total number of shares of Company Common Stock outstanding
immediately prior to the Amendment No. 2 Effective Time or
(vi) any combination of the foregoing, shall constitute an
event of the type described in this Section 13, including
without limitation, a Section 13 Event, or be deemed to cause
the Rights to be adjusted or to become exercisable in
accordance with this Section 13 or otherwise."
10. ADDITION OF SECTION 35. The Rights Agreement is hereby
modified, supplemented and amended to add the following new Section 35:
"Section 35. Merger With A-Group Merger Corp.
The Company, AT&T, Liberty and A-Group Merger Corp.,
a Delaware corporation and a wholly owned subsidiary of AT&T
("Merger Subsidiary"), intend to enter into an Agreement and
Plan of Merger, of even date with the Amendment No. 2, to be
entered into following the Amendment No. 2 Effective Time (as
it may be amended from time to time, the "Merger Agreement"),
pursuant to which Merger Subsidiary shall merge with and into
the Company. Notwithstanding anything in this Rights Agreement
to the contrary, automatically upon the Merger Agreement
Termination Time (a) the last sentence of Section 1(a); (b)
the last sentence of Section 1(d); (c) the last sentence of
Section 1(e); (d) the proviso at the end of Section 1(ww); (e)
Sections 1(xx) through 1(fff); (f) the last sentence of
Section 3(a); (g) the last sentence of Section 7(a); (h) the
second sentence of Section 11; and (i) the last sentence of
Section 13(d) of this Agreement shall be deemed repealed and
deleted without any further action on the part of the Company
or the Rights Agent; provided, however, that any such repeal
or deletion shall not impair or invalidate the effectiveness
of any of the aforementioned provisions mentioned in the
preceding clauses (a) through (i) of this Section 35 from and
including the Amendment No. 2 Effective Time through and
including the Merger Agreement Termination Time. The Company
shall promptly notify the Rights Agent of the Merger
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Agreement Termination Time and, until it receives such
written notification of such Merger Agreement Termination
Time, the Rights Agent shall incur no liability and shall be
fully protected in assuming the continued existence and
effectiveness of the Merger Agreement and the Voting
Agreement."
11. EFFECTIVENESS. This Amendment shall be deemed effective as
of the date first written above, as if executed on such date. Except as amended
hereby, the Rights Agreement shall remain in full force and effect and shall be
otherwise unaffected hereby.
12. MISCELLANEOUS. This Amendment shall be deemed to be a
contract made under the laws of the State of Delaware and for all purposes shall
be governed by and construed in accordance with the laws of the State of
Delaware applicable to contracts to be made and performed entirely within the
State of Delaware without giving effect to the principles of conflict of laws
thereof. This Amendment may be executed in any number of counterparts, each of
such counterparts shall for all purposes be deemed to be an original and all
such counterparts shall together constitute but one and the same instrument. If
any provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, illegal or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Amendment shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
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IN WITNESS WHEREOF, this Amendment has been duly executed by
the Company and the Rights Agent as of the day and year first written above.
Attest: THE ASSOCIATED GROUP, INC.
By: /s/ Xxxxx X. Xxxxx
-------------------- --------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President and
General Counsel
Attest: CHASEMELLON SHAREHOLDER SERVICES,
L.L.C., as Rights Agent
By: /s/ Xxxxx Xxxxxxxx
-------------------- -------------------------
Name: Xxxxx Xxxxxxxx
Title: Assistant Vice President
