<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ______ to ______
Commission file number 1-1105
LIBERTY MEDIA 401(k) SAVINGS PLAN
---------------------------------
(Full title of the Plan)
AT&T CORP.
----------------------------------------------------
(Issuer of the securities held pursuant to the Plan)
9197 S. Peoria
Englewood, Colorado 80112
-------------------------------------------
(Address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
<TABLE>
<CAPTION>
Financial Statements: Page No.
-------------------- --------
<S> <C>
Independent Auditors' Report 1
Statement of Net Assets Available
for Participant Benefits,
December 31, 1999 2
Statement of Changes in Net Assets
Available for Participant Benefits,
Period from inception (March 2, 1999) to
December 31, 1999 3
Notes to Financial Statements,
December 31, 1999 4
Schedule 1 - Schedule of Assets
Held for Investment Purposes, December 31, 1999 7
Exhibit -
23-Consent of KPMG LLP
</TABLE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the members of the Plan Committee have duly caused this annual report to be
signed on its behalf by the undersigned hereunto duly authorized.
LIBERTY MEDIA 401(k) SAVINGS PLAN
(Name of Plan)
By /s/ Robert R. Bennett
---------------------------------
Robert R. Bennett
Member of Plan Committee
June 28, 2000
<PAGE> 3
Independent Auditors' Report
The Plan Committee
Liberty Media 401(k) Savings Plan:
We have audited the accompanying statement of net assets available for
participant benefits of the Liberty Media 401(k) Savings Plan as of December 31,
1999, and the related statement of changes in net assets available for
participant benefits for the period from inception (March 2, 1999) to December
31, 1999. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for participant benefits of the
Liberty Media 401(k) Savings Plan as of December 31, 1999, and the changes in
net assets available for participant benefits for the period from inception
(March 2, 1999) to December 31, 1999 in conformity with generally accepted
accounting principles.
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for the purpose of additional analysis and
is not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
KPMG LLP
Denver, Colorado
June 26, 2000
1
<PAGE> 4
LIBERTY MEDIA 401(k) SAVINGS PLAN
Statement of Net Assets Available
for Participant Benefits
December 31, 1999
<TABLE>
<CAPTION>
Assets 1999
------ ------------
(amounts in thousands)
<S> <C>
Investments, at fair value:
AT&T Corp. common stock (note 3):
AT&T Common Stock Fund $ 19,083
AT&T Liberty Media Group Class A Common Stock Fund 56,653
------------
75,736
------------
Mutual Funds:
Janus Worldwide 829
Fidelity Magellan 1,835
Fidelity Equity Income 2,314
Fidelity Investment Grade Bond 895
Fidelity Retirement Money Market 78
------------
5,951
------------
Participant loans (note 4) 28
------------
Net assets available for participant benefits $ 81,715
============
</TABLE>
See accompanying notes to financial statements.
2
<PAGE> 5
LIBERTY MEDIA 401(k) SAVINGS PLAN
Statement of Changes in Net Assets Available
for Participant Benefits
Period from inception (March 2, 1999) to December 31, 1999
(amounts in thousands) (note 2)
<TABLE>
<CAPTION>
AT&T Liberty
Media Group
Class A
Participant Common Stock
Directed Funds Fund Total
-------------- ------------ ------------
<S> <C> <C> <C>
Contributions:
Employer $ -- 3,143 3,143
Employee 2,598 1,006 3,604
Transfers from other plans (note 4) 1,343 1,251 2,594
Transfers from the TCI 401(K) Plan (note 2) 32,454 18,010 50,464
------------ ------------ ------------
36,395 23,410 59,805
------------ ------------ ------------
Net investment income:
Net appreciation (depreciation) of fair
value of securities (572) 27,368 26,796
Interest income 268 -- 268
------------ ------------ ------------
(304) 27,368 27,064
------------ ------------ ------------
Total contributions and net investment income 36,091 50,778 86,869
Interfund transfers (8,161) 8,161 --
Administrative expenses (67) (16) (83)
Distributions to participants (2,801) (2,270) (5,071)
------------ ------------ ------------
Increase in net assets available for
participant benefits 25,062 56,653 81,715
Net assets available for participant benefits:
Beginning of year -- -- --
------------ ------------ ------------
End of year $ 25,062 56,653 81,715
============ ============ ============
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 6
LIBERTY MEDIA 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999
(1) Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements of the Liberty Media 401(k)
Savings Plan (the "Plan") have been prepared on an accrual basis and
present the net assets available for participant benefits and the
changes in those net assets. The sponsor of the Plan is Liberty Media
Corporation, which is a wholly-owned subsidiary of AT&T Corp.
Trust Fund Managed by Fidelity Management Trust Company ("Trustee")
Under the terms of a trust agreement between the Trustee and the Plan,
the Trustee manages a trust fund on behalf of the Plan and has been
granted authority concerning purchases and sales of investments for the
trust fund. The Trustee may invest up to 100% of the assets of the Plan
in employer securities without regard to any fiduciary requirement to
diversify Plan assets. Additionally, the Plan is allowed to invest in
non-employer securities.
Master Trust
For the period from inception (March 2, 1999) to June 30, 1999 the Plan
was a part of a Master Trust agreement with the TCI 401(k) Stock Plan.
The Master Trust had no duties, obligations, or responsibilities with
respect to the administration of the Plan. The Master Trust maintained
separate accounting to reflect the interest of each participating plan
of the Master Trust. For the period from July 1, 1999 to September 30,
1999 the Plan was part of a Group Trust agreement with plans sponsored
by AT&T Corp.
Cash and Cash Equivalents
The Plan considers investments with initial maturities of three months
or less to be cash equivalents, which are recorded at cost which
approximates fair value.
Investments
Investments are reflected in the accompanying financial statements at
current fair value. Current fair value represents the closing prices
for those securities having readily available market quotations and
fair value as determined by the Trustee with respect to other
securities. The stock funds are unitized funds that are measured in
units rather than shares. The unitized stock funds consist mostly of
stock with an insignificant amount of cash or cash equivalents. The
fair values used for the AT&T Common Stock, par value $1.00 per share
and AT&T Liberty Media Group Class A Common Stock, par value $1.00 per
share were $50.81 and $56.81 per share, respectively, at December 31,
1999. The foregoing prices are the closing market prices of the common
stocks on those dates. Securities transactions are accounted for on the
trade date. Distributions are priced at current fair value and are
accounted for when shares are transferred by the Trustee to
participants. The cost basis of such shares distributed is determined
using the "first-in, first-out" method. Investment transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date. Income from other investments is recorded as earned
on an accrual basis.
(continued)
4
<PAGE> 7
LIBERTY MEDIA 401(k) SAVINGS PLAN
Notes to Financial Statements
Income Taxes
The Plan has scheduled an application for a determination letter from
the Internal Revenue Service for the amended plan, and expects to
receive a qualified determination. The Plan administrator and the
Plan's tax counsel believe that the Plan is designed and is currently
being operated in compliance with the applicable requirements of the
Internal Revenue Code.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of additions
and deductions during the reporting period. Actual results could differ
significantly from those estimates.
Plan Expenses
Any employer contribution amounts forfeited may be used to pay plan
expenses. Any additional administrative expenses of the Plan are paid
by Liberty Media Corporation ("Liberty").
(2) Description of the Plan
The following description of the Plan is provided for general
information purposes only. Participants should refer to the plan
document for more complete information.
Effective March 2, 1999 the Plan was created as a spin-off of the TCI
401(k) Stock Plan. The Plan is a defined contribution plan sponsored by
Liberty, which enables participating employees to receive an interest
in Liberty and its parent and to receive benefits upon retirement.
Employees who are at least 18 years of age and have worked at least
three consecutive months are eligible to participate in the Plan.
Participants may contribute up to 10% of their compensation, as
defined, to the Plan. Liberty makes matching contributions equal to
100% of participant contributions, up to a maximum match of 10% of
compensation. Employer contributions are made to the AT&T Liberty Media
Group Class A Common Stock Fund. Employee contributions may be made to
any investments in the Plan, including the AT&T Liberty Media Group
Class A Common Stock Fund. Liberty reserves the right to change the
matching contribution amount at any time. Forfeitures (due to
participants' withdrawal prior to full vesting) are first used to pay
Plan expenses, with any excess used to reduce Employer's future
matching contributions. Such forfeitures amounted to $255,000 for the
period from inception to December 31, 1999. Participant contributions
are always fully vested.
As of December 31, 1999, the Plan has seven investment options
including five mutual funds and two unitized stock funds: a money
market mutual fund, a growth and income mutual fund, a diversified
growth mutual fund, an income mutual fund, a growth fund that invests
globally, a Liberty Media Group Common Stock Fund, and an AT&T Common
Stock Fund. Plan participants may change investment options and
contribution percentages on a daily basis. Distributions and other
withdrawals are processed on a daily basis.
(continued)
5
<PAGE> 8
LIBERTY MEDIA 401(k) SAVINGS PLAN
Notes to Financial Statements
Additionally, participants acquire a vested right in employer matching
contributions as follows:
<TABLE>
<CAPTION>
Vesting
Years of service percentage
---------------- ----------
<S> <C>
Less than 1 0%
1 year 33%
2 years 66%
3 years 100%
</TABLE>
Although Liberty has not expressed an intent to terminate the Plan, it
may do so at any time. The Plan provides for full and immediate vesting
of all participant rights upon termination of the Plan.
(3) Investments
The fair value of individual investments that represent 5% or more of
the Plan's net assets at December 31, 1999 are as follows:
<TABLE>
<CAPTION>
Investment Fair Value
---------------------------------------------------------- ----------------------
(amounts in thousands)
<S> <C>
AT&T Common Stock Fund $ 19,083
AT&T Liberty Media Group Class A Common Stock Fund
56,653
</TABLE>
(4) Transfers from Other Plans
During 1999, transfers to the Plan from other plans aggregated
$2,593,940.
On November 30, 1999, the DMX 401(k) Plan was transferred into the
Plan. Transfers from the DMX 401(k) Plan aggregated $1,017,144. The
transfers from the DMX 401(k) Plan included approximately $28,000 in
participant loans, which were grandfathered into the Plan.
On July 1, 1999, certain participants of the United Artist
Entertainment ("UAE") Employee Stock Ownership Plan ("ESOP") were
transferred into the Plan. Transfers from the UAE ESOP aggregated
$1,576,796.
6
<PAGE> 9
Schedule 1
LIBERTY MEDIA 401(k) SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
December 31, 1999
(amounts in thousands)
<TABLE>
<CAPTION>
(b) (c) (e)
Identity of Description of investment Current
issuer including par value value
-------------------------- ---------------------------------------- ------------
<S> <C> <C>
Janus Janus Worldwide $ 829
AT&T Corp. AT&T Common Stock, par value $1.00 per
share * 19,083
AT&T Corp. AT&T Liberty Media Class A Common Stock,
par value $1.00 per share * 56,653
Fidelity Fidelity Magellan 1,835
Fidelity Fidelity Equity Income 2,314
Fidelity Fidelity Investment Grade Bond 895
Fidelity Fidelity Retirement Money Market 78
Participant loans Interest rates ranging from 9.75% to 10% 28
------------
$ 81,715
============
</TABLE>
*Denotes party-in-interest
See accompanying independent auditors' report.
7
<PAGE> 10
EXHIBIT INDEX
Shown below is the exhibit which is filed as a part of this Report -
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ -----------
<S> <C>
23 Consent of KPMG LLP
</TABLE>
