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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: March 7, 1995
AT&T Corp.
A New York Commission File I.R.S. Employer
Corporation No. 1-1105 No. 13-4924710
32 Avenue of the Americas, New York, New York 10013-2412
Telephone Number (212) 387-5400
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Form 8-K
March 7, 1995 AT&T Corp.
Item 5. Other Events
LIN Broadcasting Corporation
LIN Broadcasting Corporation ("LIN") is 52% owned by AT&T Corp. ("AT&T")
indirectly through McCaw Cellular Communications, Inc. ("McCaw"). Under a
private market value guarantee agreement (the "PMVG") between McCaw and LIN, a
process began on January 1, 1995, to determine the private market value per
share of LIN (the "Private Market Price") using independent appraisers. On
March 7, 1995, the Private Market Price was determined, pursuant to the PMVG,
to be $127.50 per share. McCaw will have 45 days from March 7, 1995, to
decide whether to proceed with the acquisition of all the public shares at
that price, subject to the approval of the LIN public shareholders.
Pursuant to the PMVG, each of McCaw and the independent directors of LIN
retained an appraiser (hereinafter, the "McCaw Appraiser" and the "LIN
Appraiser" respectively) in each case to determine the private market value
per share of LIN. On February 15, 1995, the McCaw Appraiser and the LIN
Appraiser determined that value to be $105 per share and $155 per share,
respectively. Because these appraisals differed by more than 10%, a jointly
designated appraiser (the "Mutually Designated Appraiser") was selected to
arrive at its determination of the private market value per share. On March
7, 1995, the Mutually Designated Appraiser determined the value, as defined by
the PMVG, to be $127.50 per share. Therefore, pursuant to the PMVG, the
Private Market Price is $127.50 per share.
AT&T and McCaw are evaluating the Private Market Price and will make a
determination as to whether McCaw should proceed with an acquisition of the
LIN public shares. Any such acquisition would involve a substantial capital
expenditure. The public shareholders hold approximately 25 million shares of
LIN. If McCaw does not proceed with an acquisition, the PMVG provides that
McCaw will put LIN in its entirety up for sale under the direction of the LIN
independent directors subject to the approval of the LIN public shareholders.
In connection with this matter, several purported class action suits
have been filed against AT&T and others. On February 17, 1995, two purported
class actions were filed in the Delaware Chancery Court entitled Fried v. MMM
Holdings Inc., et al. (the "Fried Action") and Blake v. AT&T Corp., et al.
(the "Delaware Actions"). On February 21, 1995, a purported class action was
filed in New York State Supreme Court against AT&T and its directors entitled
Katz v. Robert E. Allen, et al. (the "New York Action"). The Delaware Actions
allege that AT&T, among others, has violated its fiduciary duties, and one of
the Delaware Actions alleges that AT&T, among others, has violated its
obligations under the PMVG, in each case by virtue of, among other things, the
McCaw Appraiser's view that the private market value of LIN as defined under
the PMVG is $105 per share. The New York Action similarly alleges that AT&T
and its directors have violated their fiduciary duties by virtue of, among
other things, the McCaw Appraiser's determination under the PMVG. On March 6,
1995, the Delaware Actions were consolidated with two additional actions that
have been filed in the Delaware Court of Chancery entitled Phillip Frank v.
McCaw Cellular Communications, et. al. and H. Richard Dollinger v. MMM
Holdings, Inc. Pursuant to the order of consolidation, the complaint in the
Fried Action was designated as the complaint in the consolidated action. AT&T
believes that the actions are without merit.
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Form 8-K
March 7, 1995 AT&T Corp.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AT&T Corp.
By: S.L. Prendergast
Vice President and Treasurer
March 7, 1995
