<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
THE ASSOCIATED GROUP, INC.
(Name of Issuer)
Common Stock, Class A, $.10 par value
Common Stock, Class B, $.10 par value
(Title of Class of Securities)
Common Stock, Class A: 045651-10-6
Common Stock, Class B: 045651-20-5
(CUSIP Number)
Charles Y. Tanabe
Senior Vice President and General Counsel
Liberty Media Corporation
9197 South Peoria Street, Englewood, CO 80112 (303) 875-5400
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 28, 1999
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the
following box: [ ].
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
CUSIP No. 045651-10-6 (Class A)
CUSIP No. 045651-20-5 (Class B)
1. Names of Reporting Persons I.R.S. Identification Nos. of Above Persons
(entities only)
Liberty Media Corporation
2. Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [X]
3. SEC Use Only
4. Source of Funds
OO
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e) [ ]
6. Citizenship or Place of Organization
Delaware
<TABLE>
<S> <C> <C>
Number of 7. Sole Voting Power 0 Shares
Shares Bene-
ficially 8. Shared Voting Power 4,200,226 Shares of Class A Stock (See Item 5)
Owned by 4,056,226 Shares of Class B Stock (See Item 5)
Each Report- 9. Sole Dispositive Power 0 Shares
ing Person
With 10. Shared Dispositive 4,200,226 Shares of Class A Stock (See Item 5)
Power 0 Shares of Class B Stock (See Item 5)
</TABLE>
11. Aggregate Amount Beneficially Owned by Each Reporting Person
4,200,226 Shares (See Item 5)
4,056,226 Shares of Class B Stock (See Item 5)
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
[X]
13. Percent of Class Represented by Amount in Row (11)
Approximately 22.4% (Class A)(See Item 5)
Approximately 20.9% (Class B)(See Item 5)
14. Type of Reporting Person
CO
Page 2 of 9
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Statement of
LIBERTY MEDIA CORPORATION
Pursuant to Section 13(d) of the
Securities Exchange Act of 1934
in respect of
THE ASSOCIATED GROUP, INC.
ITEM 1. SECURITY AND ISSUER
Liberty Media Corporation, a Delaware corporation (the "Reporting Person"),
is filing this Statement on Schedule 13D (this "Statement") with respect to
shares of the Common Stock, Class A, par value $.10 per share ("Class A Stock"),
and shares of the Common Stock, Class B, par value $.10 per share ("Class B
Stock"), of The Associated Group, Inc. (the "Issuer"). The Issuer's principal
executive offices are located at 200 Gateway Towers, Pittsburgh, Pennsylvania,
15222.
ITEM 2. IDENTITY AND BACKGROUND
The reporting person is Liberty Media Corporation whose principal business
address is 9197 South Peoria Street, Englewood, Colorado 80112.
The Liberty Media Group (the "Liberty Media Group"), which is a "tracking
stock" group of AT&T Corp. ("AT&T") and principally consists of the assets and
business of the Reporting Person and its subsidiaries as well as certain other
indirect subsidiaries of AT&T which have assets and businesses related to those
of the Reporting Person, is engaged in (i) the production, acquisition and
distribution through all available formats and media of branded entertainment,
educational and informational programming and software, including multimedia
products, (ii) electronic retailing, direct marketing, advertising sales related
to programming services, infomercials and transaction processing, (iii)
international cable television distribution, telephony and programming, (iv)
satellite communications and (v) investments in wireless domestic telephony and
other technology ventures.
The members of the Board of Directors and executive officers of the
Reporting Person manage the business and affairs of the Reporting Person.
Although the Reporting Person is an indirect wholly owned subsidiary of AT&T, a
majority of the Reporting Person's Board of Directors consists of individuals
designated by Tele-Communications, Inc. ("TCI") prior to the acquisition of TCI
by AT&T. If these
Page 3 of 9
<PAGE>
individuals or their designated successors cease to constitute a majority of the
Reporting Person's Board, the Reporting Person will transfer all of its assets
and businesses to a new entity. Although the outstanding equity interests of
this new entity would be owned substantially by AT&T, it would continue to be
managed by management of the Reporting Person prior to such transfer of assets.
As a result of entering into the Voting Agreement described in Item 3
below, the Reporting Person may be deemed to have formed a "group" with each of
the Stockholders (as defined in Item 3 below), for purposes of Section 13(d)(3)
of the Securities Exchange Act of 1934, as amended (the "Act"), and Rule 13d-
5(b)(1) thereunder. The Reporting Person expressly declares that the filing of
this Schedule 13D shall not be construed as an admission by it that it has
formed any such group.
Schedule 1 attached to this Statement contains the following information
concerning each director, executive officer and controlling person of the
Reporting Person: (i) name and residence or business address, (ii) principal
occupation or employment; and (iii) the name, principal business and address of
any corporation or other organization in which such employment is conducted.
Schedule 1 is incorporated herein by reference.
To the knowledge of the Reporting Person, each of the persons named on
Schedule 1 (the "Schedule 1 Persons") is a United States citizen, except for
David J.A. Flowers, who is a Canadian citizen. During the last five years,
neither the Reporting Person nor any of the Schedule 1 Persons (to the knowledge
of the Reporting Person) has been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors). During the last five years, neither
the Reporting Person nor any of the Schedule 1 Persons (to the knowledge of the
Reporting Person) has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and, as a result of such
proceeding, is or was subject to a judgment, decree or final order enjoining
future violations
Page 4 of 9
<PAGE>
of, or prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation with respect to such laws.
Schedule 2 attached to this Statement contains the following information
which has been provided to the Reporting Person by AT&T concerning each
director, executive officer or controlling person of AT&T: (i) name and
residence or business address, (ii) principal occupation or employment; and
(iii) the name, principal business and address of any corporation or other
organization in which such employment is conducted. Schedule 2 is incorporated
herein by reference.
Based upon information provided to the Reporting Person by AT&T, (i) to the
knowledge of AT&T, each of the persons named on Schedule 2 (the "Schedule 2
Persons") is a United States citizen, (ii) during the last five years, neither
AT&T nor any of the Schedule 2 Persons (to the knowledge of AT&T) has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors), and (iii) during the last five years, neither AT&T nor any of the
Schedule 2 Persons (to the knowledge of AT&T) has been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and,
as a result of such proceeding, is or was subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The Reporting Person entered into an Agreement and Plan of Merger, dated as
of May 28, 1999 by and among AT&T, the Reporting Person, A-Group Merger Corp., a
Delaware corporation and newly-formed wholly owned direct subsidiary of AT&T
("Merger Sub"), and the Issuer (the "Merger Agreement"), providing for the
acquisition of the Issuer by means of a merger of Merger Sub with and into the
Issuer (the "Merger"), with the Issuer surviving the Merger (the "Surviving
Entity"). Following the Merger, the Surviving Entity will become part of the
Liberty Media Group. The Merger is subject to the approval of the Merger
Agreement by the Issuer's stockholders, the expiration of the applicable waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, the receipt of all required approvals of the Federal Communications
Commission and any other required regulatory approvals, and the satisfaction or
waiver of certain other conditions as more fully described in the Merger
Agreement.
As an inducement for the Reporting Person to enter into the Merger
Agreement and in consideration thereof, Myles P. Berkman, David J. Berkman,
Lillian R. Berkman, the estate of Jack N. Berkman, the Sybiel B. Berkman
Foundation, Monroe E. Berkman Family Limited Partnership, Stephen L. Berkman
Trust and Monroe E. Berkman Trust (collectively, the "Stockholders"), entered
into a Voting Agreement (the "Voting Agreement"), dated as of May 28, 1999, with
the Reporting Person and AT&T whereby the Stockholders agreed, severally and not
jointly, to vote all of the shares of Class A Stock and all other voting
securities of the Issuer which the Stockholders have the right to vote or direct
the voting (including shares of Class B Stock) (a) in favor of approval and
adoption of the
Page 5 of 9
<PAGE>
Merger Agreement and the Merger, and (b) against any other proposal for a
merger, consolidation, reorganization, other business combination, or
recapitalization involving the Issuer, for the acquisition of a 25% or greater
interest in the equity of the Issuer, for the acquisition of the right to cast
25% or more of the votes on any matter with respect to the Issuer, or for the
acquisition of more than 25% of the assets of the Issuer and certain of its
subsidiaries, taken as a whole (an "Alternative Proposal"). The Voting Agreement
also provides that no Stockholder will directly or indirectly sell, pledge,
encumber, grant any proxy or enter into any voting or similar agreement with
respect to, transfer or otherwise dispose of (collectively, "Transfer"), or
agree or contract to Transfer, any shares of Class A Stock (or any interest
therein) with respect to which a Stockholder directly or indirectly controls the
right to Transfer, except for (i) any pledge by a Stockholder of shares of Class
A Stock so long as the Stockholder retains full voting rights with respect to
such shares (even in the event of a foreclosure by the pledgee) or (ii) any such
Transfer to any person or entity (including without limitation an estate) who or
which shall have agreed in writing with Liberty to be bound by the Voting
Agreement as a Stockholder.
The Voting Agreement terminates upon the earliest to occur of (i) the
Merger or (ii) the date on which the Merger Agreement is terminated in
accordance with its terms, provided, however, that if the Merger Agreement is
terminated as a result of (A) the stockholders of the Issuer failing to approve
the Merger Agreement and the Merger, or (B) the Issuer's Board of Directors
withdrawing or modifying (in a manner adverse to AT&T or the Reporting Person)
its approval or recommendation of the Merger, or approving, recommending or
authorizing the Issuer to enter into, an agreement with respect to an
Alternative Proposal, then the Voting Agreement shall terminate upon the earlier
of (A) six months after such termination of the Merger Agreement, or (B) the
date of payment of any termination fee that may be payable as a result of such
termination of the Merger Agreement. The Reporting Person did not pay
additional consideration to any Stockholder in connection with the execution and
delivery of the Voting Agreement.
References to, and the descriptions of, the Merger Agreement and the Voting
Agreement as set forth above in this Item 3 are qualified in their entirety by
reference to the copies of the Merger Agreement and the Voting Agreement which
are included as Exhibits 2.1 and 10.1, respectively, to this Statement, and are
incorporated in this Item 3 in their entirety.
ITEM 4. PURPOSE OF TRANSACTION
The information set forth, or incorporated by reference, in Item 3 is
incorporated herein by reference. The purpose of the Voting Agreement is to
facilitate consummation of the Merger.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
The information set forth, or incorporated by reference, in Item 3 is
incorporated herein by reference.
The number of shares of Class A Stock covered by the Voting Agreement is
4,200,226, which constitutes approximately 22.4% of the Class A Stock, based on
the number of shares of Class A Stock outstanding on May 28, 1999, as
represented by the Issuer in the Merger Agreement. Based solely upon information
provided to the Reporting Person by the Issuer, the Stockholders currently hold
an aggregate of 4,056,076 shares of Class B Stock. Based on the number of shares
of Class B Stock outstanding as of May 28, 1999, as represented by the Issuer in
the Merger Agreement, such shares represent approximately 20.9% of the
outstanding shares of Class B Stock.
Shares of Class A Stock are each generally entitled to one vote per share
on matters presented to a vote of the stockholders of the Issuer. Shares of
Class B Stock are generally entitled to 1/25th of a vote per share on matters
presented to a voted of the stockholders of the Issuer. Based on the number of
shares of Class A Stock and Class B Stock outstanding as of May 28, 1999, as
represented by the Issuer in the Merger Agreement, the number of shares of Class
A Stock and Class B Stock held by the Stockholders represents approximately
22.3% of the combined voting power of the shares of Class A Stock and Class B
Stock.
Page 6 of 9
<PAGE>
By virtue of the Voting Agreement, the Reporting Person may be deemed to
share with the respective Stockholders voting power and dispositive power over
shares of Class A Stock subject to the Voting Agreement and voting power over
shares of Class B Stock subject to the Voting Agreement. However, the Reporting
Person (i) is not entitled to any rights as a stockholder of the Issuer as to
the shares of Class A Stock and Class B Stock covered by the Voting Agreement
and (ii) disclaims any beneficial ownership of the shares of Class A Stock and
Class B Stock covered by the Voting Agreement. See the information in Item 3
with respect to the Voting Agreement, which information is incorporated herein
by reference.
Liberty Ventures Group LLC, an indirect wholly-owned subsidiary of AT&T
which is not included in the Liberty Media Group ("LVG"), holds 45,000 shares of
Class A Stock and 45,000 shares of Class B Stock, all of which such shares are
attributed to the Liberty Media Group. The foregoing calculations of the
percentage of the beneficial ownership of the Class A Stock and the Class B
Stock do not include such shares.
Neither the Reporting Person nor, to the knowledge of the Reporting Person,
any of the Schedule 1 Persons, has executed transactions in the Class A Stock or
the Class B Stock during the past 60 days. Based upon information provided to
the Reporting Person by AT&T, to the knowledge of AT&T, none of the Schedule 2
Persons has executed transactions in the Class A Stock or the Class B Stock
during the past 60 days.
References to, and the descriptions of, the Merger Agreement and the Voting
Agreement as set forth above in this Item 5 are qualified in their entirety by
reference to the copies of the Merger Agreement and the Voting Agreement which
are included as Exhibits 2.1 and 10.1, respectively, to this Statement and are
incorporated in this Item 5 in their entirety.
Page 7 of 9
<PAGE>
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER
The information set forth, or incorporated by reference, in Items 3 through
5 is hereby incorporated herein by reference. Copies of the Merger Agreement
and the Voting Agreement are included as Exhibits 2.1 and 10.1, respectively, to
this Statement. To the Reporting Person's knowledge, except as described in
this Statement, there are at present no contracts, arrangements, understandings
or relationships (legal or otherwise) among the Persons named in Item 2 above
and between any such Persons and any person with respect to any securities of
the Issuer.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
(a) Agreement and Plan of Merger, dated as of May 28, 1999, among AT&T
Corp., A-Group Merger Corp., Liberty Media Corporation and The
Associated Group, Inc. (incorporated by reference to Exhibit 2.1 to the
Current Report on Form 8-K of The Associated Group, Inc., filed on June
3, 1999).
(b) Agreement, dated as of May 28, 1999, by and among AT&T Corp., Liberty
Media Corporation and the other parties named therein.
[Signature on following page]
Page 8 of 9
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
June 9, 1999 LIBERTY MEDIA CORPORATION
/s/ Charles Y. Tanabe
-----------------------------------------
Charles Y. Tanabe
Senior Vice President and General Counsel
<PAGE>
SCHEDULE 1
DIRECTORS AND EXECUTIVE OFFICERS
OF
LIBERTY MEDIA CORPORATION
The name and present principal occupation of each director and executive
officer of Liberty Media Corporation ("Liberty Media") are set forth below. The
business address for each person listed below is c/o Liberty Media Corporation,
9197 South Peoria Street, Englewood, Colorado 80112. All executive officers and
directors listed on this Schedule 1 are United States citizens, except for David
J.A. Flowers, who is a Canadian citizen.
<TABLE>
<CAPTION>
Name Principal Occupation
- --------------------- ------------------------------------------------------------------
<S> <C>
John C. Malone Chairman of the Board and Director of Liberty Media; Director of
AT&T Corp.
Robert R. Bennett President, Chief Executive Officer and Director of Liberty Media
Gary S. Howard Executive Vice President, Chief Operating Officer and Director of
Liberty Media
Leo J. Hindery, Jr. Director of Liberty Media; President and Chief Executive Officer,
AT&T Broadband and Internet Services
Daniel E. Somers Director of Liberty Media; Senior Executive Vice President and
Chief Financial Officer of AT&T Corp.
John C. Petrillo Director of Liberty Media; Executive Vice President, Corporate
Strategy and Business Development of AT&T Corp.
Larry E. Romrell Director of Liberty Media; Consultant to Tele-Communications, Inc.
Jerome H. Kern Director of Liberty Media; Chairman of Linkshare Corporation
Paul A. Gould Director of Liberty Media; Managing Director of Allen & Co.
David B. Koff Senior Vice President and Assistant Secretary of Liberty Media
Charles Y. Tanabe Senior Vice President, General Counsel and Assistant Secretary of
Liberty Media
Peter Zolintakis Senior Vice President of Liberty Media
Vivian J. Carr Vice President and Secretary of Liberty Media
Kathryn S. Douglass Vice President and Controller of Liberty Media
David J.A. Flowers Vice President and Treasurer of Liberty Media
</TABLE>
<PAGE>
SCHEDULE 2
DIRECTORS AND EXECUTIVE OFFICERS
OF
AT&T CORP.
The name and present principal occupation of each director and executive
officer of AT&T Corp. are set forth below. The business address for each person
listed below is c/o AT&T Corp., 295 North Maple Avenue, Basking Ridge, New
Jersey 07920. All executive officers and directors listed on this Schedule 2
are United States citizens.
<TABLE>
<CAPTION>
Name Title
- ---------------------- -------------------------------------------------------------------
<S> <C>
C. Michael Armstrong Chairman of the Board, Chief Executive Officer and Director
Kenneth T. Derr Director; Chief Executive Officer of Chevron Corporation
M. Kathryn Eickhoff Director; President of Eickhoff Economics, Inc.
Walter Y. Elisha Director; Retired Chairman and Chief Executive Officer of Springs
Industries, Inc.
George M. C. Fisher Director; Chairman and Chief Executive Officer of Eastman Kodak
Company
Donald V. Fites Director; Chairman, Retired - Caterpillar, Inc.
Ralph S. Larsen Director; Chairman and Chief Executive Officer of Johnson &
Johnson
John C. Malone Director; Chairman of the Board of Liberty Media Corporation
Donald F. McHenry Director; President of IRC Group
Michael I. Sovern Director; President Emeritus and Chancellor Kent Professor of Law
at Columbia University
Sanford I. Weill Director; Chairman and Co-CEO of Citigroup Inc.
Thomas H. Wyman Director; Senior Advisor of SBC Warburg, Inc.
John D. Zeglis President and Director
Harold W. Burlingame Executive Vice President, Merger & Joint Venture Integration
James Cicconi Executive Vice President-Law & Governmental Affairs and General
Counsel
Mirian Graddick Executive Vice President, Human Resources
Daniel R. Hesse Executive Vice President and President & CEO, AT&T Wireless
Services, Inc.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Name Title
- --------------------- ------------------------------------------------------------------
<S> <C>
Leo J. Hindery, Jr. President and Chief Executive Officer, AT&T Broadband and
Internet Services
Frank Ianna Executive Vice President and President, AT&T Network Services
Michael G. Keith Executive Vice President and President, AT&T Business Services
H. Eugene Lockhart Executive Vice President, Chief Marketing Officer
Richard J. Martin Executive Vice President, Public Relations and Employee
Communication
David C. Nagel President, AT&T Labs & Chief Technology Officer
John C. Petrillo Executive Vice President, Corporate Strategy and Business
Development
Richard Roscitt Executive Vice President and President & CEO, AT&T Solutions
D.H. Schulman Executive Vice President AT&T Consumer Services
Daniel E. Somers Senior Executive Vice President and Chief Financial Officer
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- --------------------------------------------------------------------------
<C> <S>
2.1 Agreement and Plan of Merger, dated as of May 28, 1999, among AT&T
Corp., A-Group Merger Corp., Liberty Media Corporation and The
Associated Group, Inc. (incorporated by reference to Exhibit 2.1 to the
Current Report on Form 8-K of The Associated Group, Inc., filed on June
3, 1999).
10.1 Agreement, dated as of May 28, 1999, by and among AT&T Corp.,
Liberty Media Corporation and the other parties named therein.
</TABLE>
<PAGE>
EXHIBIT 10.1
AGREEMENT
THIS AGREEMENT (this "Agreement"), dated as of May 28, 1999, is
entered into by and among AT&T Corp., a New York corporation ("Parent"), Liberty
Media Corporation, a Delaware corporation ("Liberty"), on the one hand, and the
other parties named on the signature pages of this Agreement (collectively, the
"Stockholders"), on the other hand.
WHEREAS, concurrently herewith, Parent, Liberty, A-Group Merger Corp.,
a Delaware corporation and a wholly owned subsidiary of Parent ("Merger Sub"),
and The Associated Group, Inc., a Delaware corporation (the "Company"), are
entering into an Agreement and Plan of Merger (as amended or supplemented from
time to time, the "Merger Agreement");
WHEREAS, as of the date hereof, the Stockholders own and/or have the
power to vote, as applicable, the number of Shares (as defined below) set forth
in Schedule I hereto;
WHEREAS, the Board of Directors of the Company has, prior to the
execution of this Agreement, duly and validly approved and adopted the Merger
Agreement, and has approved this Agreement (solely for purposes of paragraph
(a)(1) of Section 203 of the DGCL as may be applicable to Parent or Liberty with
respect to the Company by virtue of this Agreement) and such approvals and
adoption have not been withdrawn;
WHEREAS, approval of the Merger Agreement by the Company's
stockholders is a condition to the consummation of the Merger; and
WHEREAS, as a condition to its entering into the Merger Agreement,
Liberty has required that each Stockholder agree, and each Stockholder has
agreed, to enter into this Agreement;
WHEREAS, capitalized terms used herein (including in Schedules I and
II hereto) but not defined herein shall have the respective meanings ascribed
thereto in the Merger Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein, the parties hereto agree as follows:
Section 1. Agreement to Vote.
-----------------
(a) Each Stockholder hereby agrees with Liberty to attend the Special
Meeting of the Company (or any other meeting of stockholders of the Company at
which the Merger Proposal is to be submitted to a vote of the stockholders of
the Company), in person or by proxy, and to vote (or cause to be voted) all
Shares and any other voting securities of the Company (including any such
securities acquired hereafter) that such Stockholder has the right to vote or
direct the voting as of the applicable record date (collectively, the "Covered
Shares"), for approval and adoption of the Merger
<PAGE>
Agreement, the Merger and any related action reasonably required in furtherance
thereof and duly submitted to a vote of the stockholders at the Special Meeting
or any other meeting of stockholders of the Company, such agreement to vote to
apply also to any adjournment or adjournments or postponement or postponements
of the Special Meeting (or any such other meeting). Each Stockholder hereby
further agrees with Liberty that he, she or it shall, from time to time, in
connection with any consent or proxy solicitation relating to the Merger
Agreement, timely execute and deliver (or cause to be timely executed and
delivered) a written consent or proxy with respect to any Covered Shares in
favor of the approval and adoption of the Merger Agreement, the Merger and any
related action reasonably required in furtherance thereof as contemplated by the
immediately preceding sentence.
(b) Each Stockholder hereby agrees with Liberty to vote (or cause to
be voted) any Covered Shares against any Alternative Proposal and any related
action reasonably required in furtherance thereof, at any meeting of
stockholders of the Company (including any adjournments or postponements
thereof) called to consider and vote on any Alternative Proposal. Each
Stockholder further agrees with Liberty that, in connection with any consent or
proxy solicitation relating to a Alternative Proposal, such Stockholder will
timely execute and deliver (or cause to be timely executed and delivered) a
written consent or proxy with respect to any Covered Shares against any
Alternative Proposal as contemplated by the immediately preceding sentence.
(c) To the extent inconsistent with the foregoing provisions of this
Section 1, each Stockholder acknowledges and agrees with Liberty that such
Stockholder hereby revokes any and all previous proxies with respect to such
Stockholder's Covered Shares.
(d) Notwithstanding any other provision of this Agreement, nothing
contained herein shall (i) restrict, limit or prohibit in any manner any
Stockholder (including in such Stockholder's representative capacity) who is a
director or officer of the Company, any Subsidiary of the Company or of Tokyo or
any Subsidiary of Tokyo, from taking any action or omitting to act in his
capacity as such a director or officer or (ii) require any Stockholder
(including in such Stockholder's representative capacity) to, or to seek to,
cause any director or officer of the Company, any Subsidiary of the Company or
of Tokyo or any Subsidiary of Tokyo, to take or omit to take any action in his
capacity as such a director or officer; provided that nothing in this Section
1(d) shall be deemed to relieve any Stockholder from such Stockholder's
obligations under Sections 1, 2 and 3 of this Agreement.
Section 2. Disposition of Shares. Each Stockholder hereby agrees with
---------------------
Liberty that such Stockholder will not directly or indirectly sell, pledge,
encumber, grant any proxy or enter into any voting or similar agreement with
respect to, transfer or otherwise dispose of (collectively, "Transfer"), or
agree or contract to Transfer, any Shares (or any interest therein) with respect
to which a Stockholder directly or indirectly controls the right to Transfer,
except for (i) any pledge by a Stockholder of Shares so long as the Stockholder
retains full voting rights with respect to such Shares (even in the event of a
foreclosure by the pledgee) or (ii) any such Transfer to any Person or entity
(including without limitation an estate) who or which shall have agreed in
writing with Liberty
<PAGE>
to be bound by this Agreement as a Stockholder (any direct or indirect
transferee referred to in clauses (i) and (ii) above being referred to as a
"Permitted Transferee").
Section 3. Further Assurances. Each Stockholder agrees with Liberty
------------------
that such Stockholder will execute and deliver such additional instruments and
other documents and shall take such further actions as may be reasonably
necessary to effectuate, carry out and comply with such Stockholder's
obligations under this Agreement in accordance with the terms hereof. Without
limiting the generality of the foregoing, each Stockholder agrees with Liberty
that such Stockholder will not enter into any agreement or arrangement (or
alter, amend or terminate any existing agreement or arrangement) or take any
other action (or fail to take any other action) if such action (or failure)
would materially impair the ability of such Stockholder to effectuate, carry out
or comply with all the terms of this Agreement. Parent and Liberty each agree to
cooperate with each Stockholder in connection with any filings required to be
made by such Stockholder relating to this Agreement, the Merger Agreement or the
transactions contemplated hereby or thereby.
Section 4. Representations and Warranties of Parent and Liberty.
----------------------------------------------------
(a) Parent represents and warrants to each Stockholder as follows:
This Agreement has been duly executed and delivered by a duly authorized officer
of Parent and constitutes a valid and binding agreement of Parent, enforceable
against Parent.
(b) Liberty represents and warrants to each Stockholder as follows:
Each of this Agreement and the Merger Agreement has been approved by the Board
of Directors of Liberty, in each case representing all necessary corporate
action on the part of Liberty. Each of this Agreement and the Merger Agreement
has been duly executed and delivered by a duly authorized officer of Liberty.
Each of this Agreement and the Merger Agreement constitutes a valid and binding
agreement of Liberty, enforceable against Liberty.
Section 5. Representations and Warranties of the Stockholders.
--------------------------------------------------
Each Stockholder severally represents and warrants (solely with
respect to such Stockholder) to Liberty as follows:
(a) Such Stockholder has the power and authority to execute and
deliver this Agreement. This Agreement has been duly executed and delivered by
such Stockholder. This Agreement constitutes the valid and binding agreement of
such Stockholder. Such Stockholder has the full power and authority to vote (or
cause to be voted), or execute (or cause to be executed) a consent with respect
to, all Shares as contemplated hereby. The securities of the Company listed next
to the name of such Stockholder on Schedule I hereto are the only shares of
Company Class A Common Stock of the Company over which such Stockholder has the
power to vote (or direct the voting) (such shares of Company Class A Common
Stock being referred to as the "Shares").
(b) Each Stockholder is the lawful owner of the Shares listed on
Schedule I as owned by such Stockholder, free and clear of all liens, charges,
encumbrances and commitments of
<PAGE>
every kind, other than this Agreement and as set forth on Schedule II hereto,
and each Stockholder has the power to vote or cause to be voted (including by
granting an irrevocable power to vote or executing a written consent) such
Shares so listed. The execution and delivery by such Stockholder of this
Agreement do not violate or breach any contract, instrument, agreement or
arrangement to which such Stockholder is a party or by which such Stockholder is
bound or, to the best knowledge and belief of such Stockholder, any law
applicable to such Stockholder.
Section 6. Effectiveness; Term of Agreement; Termination. It is a
---------------------------------------------
condition precedent to the effectiveness (and the commencement of the term) of
this Agreement that the Merger Agreement shall have been duly adopted and
approved and executed and delivered by the parties thereto. Subject to the
immediately preceding sentence, the term of this Agreement shall commence on the
date hereof, and such term and this Agreement shall terminate automatically upon
the earliest to occur of (a) the Effective Time or (b) the termination of the
Merger Agreement in accordance with its terms, provided, however, that if the
Merger Agreement is terminated pursuant to Section 9.1(ii)(D) or Section
9.1(iii) thereof, in either case without regard to whether any Termination Fee
becomes payable following such termination, this Agreement shall terminate upon
the earlier of (i) the date which is six months after such termination of the
Merger Agreement or (ii) the date on which a Termination Fee is paid. Upon such
termination of this Agreement, no party shall have any obligation or liability
hereunder; provided that if such termination is pursuant to clause (b)
immediately above, such termination shall not relieve any party from liability
for any breach of this Agreement prior to such termination.
Section 7. Miscellaneous.
-------------
(a) Notices, Etc. All notices, requests, demands or other
------------
communications required by or otherwise with respect to this Agreement shall be
in writing and shall be deemed to have been duly given to any party when
delivered personally (by courier service or otherwise), when delivered by
telecopy and confirmed by return telecopy, or one day after being sent by
courier service that guarantees overnight delivery to the applicable addresses
(or facsimile numbers) set forth below:
If to Parent:
AT&T Corp.
295 North Maple Avenue
Basking Ridge, NJ 07920
Attention: Vice President-Law and Corporate Secretary
Facsimile: (908) 221-6618
<PAGE>
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 W. 52d Street
New York, NY 10019
Attention: David Silk, Esq.
Facsimile: (212) 403-2000
If to Liberty:
Liberty Media Corporation
9197 South Peoria Street
Englewood, CO 80112
Attention: Charles Y. Tanabe, Esq.
Facsimile: (720) 875-5382
with a copy to:
Baker & Botts, L.L.P.
599 Lexington Ave.
New York, NY 10022
Attention: John L. Graham, Esq.
Facsimile: (212) 705-5125
If to any Stockholder, to such
Stockholder c/o:
Myles P. Berkman
The Associated Group, Inc.
200 Gateway Towers
Pittsburgh, PA 15222
Facsimile: (412) 281-1914
with a copies to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street
Boston, MA 02108
Attention: Kent A. Coit, Esq.
Facsimile: (617) 573-4822
and
<PAGE>
Scott G. Bruce, Esq.
The Associated Group, Inc.
Three Bala Plaza East
Suite 502
Bala Cynwyd, PA 19004
Facsimile: (610) 660-4920
and
Dechert Price & Rhoads
1717 Arch Street
Philadelphia, PA 19103
Attention: Barton J. Winokur, Esq.
Facsimile: (215) 994-2222
or to such other address as such party shall have designated by notice so given
to each other party.
(b) Amendments, Waivers, Etc. This Agreement may not be amended,
------------------------
changed, supplemented, waived or otherwise modified or terminated except by an
instrument in writing signed by Liberty and each Stockholder.
(c) Successors and Assigns. This Agreement shall be binding upon and
----------------------
shall inure to the benefit of and be enforceable by the parties and their
respective successors and assigns, including without limitation in the case of
Parent or Liberty any corporate successor by merger or otherwise, and in the
case of a Stockholder any Permitted Transferee, including any trustee, executor,
heir, legatee or personal representative succeeding to the ownership of (or
power to vote) such Stockholder's Covered Shares or other securities subject to
this Agreement (including as a result of the death, disability or incapacity of
a Stockholder).
(d) Entire Agreement. This Agreement embodies the entire agreement and
----------------
understanding among the parties relating to the subject matter hereof and
supersedes all prior agreements and understandings relating to such subject
matter. There are no representations, warranties or covenants by the parties
hereto relating to such subject matter other than those expressly set forth in
this Agreement.
(e) Severability. If any term of this Agreement or the application
------------
thereof to any party or circumstance shall be held invalid or unenforceable to
any extent, the remainder of this Agreement and the application of such term to
the other parties or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by applicable law, provided that in
such event the parties shall negotiate in good faith in an attempt to agree to
another provision (in lieu of the term or application held to be invalid or
unenforceable) that will be valid and enforceable and will carry out the
parties' intentions hereunder.
<PAGE>
(f) Specific Performance. The parties acknowledge that money damages
--------------------
are not an adequate remedy for violations of this Agreement and that any party
may, in its sole discretion, apply to a court of competent jurisdiction for
specific performance or injunctive or such other relief as such court may deem
just and proper in order to enforce this Agreement or prevent any violation
hereof and, to the extent permitted by applicable law, each party waives any
objection to the imposition of such relief for any such violation.
(g) Remedies Cumulative. All rights, powers and remedies provided
-------------------
under this Agreement or otherwise available in respect hereof at law or in
equity shall be cumulative and not alternative, and the exercise or beginning of
the exercise of any thereof by any party shall not preclude the simultaneous or
later exercise of any other such right, power or remedy by such party.
(h) No Waiver. The failure of any party hereto to exercise any right,
---------
power or remedy provided under this Agreement or otherwise available in respect
hereof at law or in equity, or to insist upon compliance by any other party
hereto with its obligations hereunder, and any custom or practice of the parties
at variance with the terms hereof, shall not constitute a waiver by such party
of his or her right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) No Personal Liability for Stockholder Representatives; No Third
---------------------------------------------------------------
Party Beneficiaries; Severability; No Liability of Stockholders to Parent. It is
- -------------------------------------------------------------------------
expressly understood and agreed that no executor, trustee, officer, director, or
other representative of a Stockholder shall have any personal liability
hereunder as a result of such person's execution and delivery of this Agreement
or for any acts or omissions in such person's capacity as such executor,
trustee, officer, director or other representative. This Agreement is not
intended to be for the benefit of and shall not be enforceable by any person or
entity who or which is not a party hereto. The representations and warranties of
each Stockholder contained herein and the obligations of each Stockholder
hereunder are several and not joint, and no Stockholder shall be liable for any
representation, warranty, agreement, action or inaction of any other
Stockholder. Notwithstanding any other provision of this Agreement, no
Stockholder shall have any liability to Parent hereunder in respect of any
representation, warranty, covenant, agreement or any other obligation of any
Stockholder set forth herein.
(j) Jurisdiction. Each party hereby irrevocably submits to the
------------
exclusive jurisdiction of the Court of Chancery in the State of Delaware or the
United States District Court for the Southern District of New York or any court
of the State of New York located in the City of New York in any action, suit or
proceeding arising in connection with this Agreement, and agrees that any such
action, suit or proceeding shall be brought only in such court (and waives any
objection based on forum non conveniens or any other objection to venue
therein); provided, however, that such consent to jurisdiction is solely for the
purpose referred to in this paragraph (j) and shall not be deemed to be a
general submission to the jurisdiction of said Courts or in the States of
Delaware or New York other than for such purposes. Each party hereto hereby
waives any right to a trial by jury in connection with any such action, suit or
proceeding.
<PAGE>
(k) Governing Law. This Agreement and all disputes hereunder shall be
-------------
governed by and construed and enforced in accordance with the laws of the State
of Delaware, including the General Corporation Law of the State of Delaware, to
the fullest extent possible.
(l) Name, Captions, Gender. The name assigned to this Agreement and
----------------------
the section captions used herein are for convenience of reference only and shall
not affect the interpretation or construction hereof. Whenever the context may
require, any pronoun used herein shall include the corresponding masculine,
feminine or neuter forms.
(m) Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one instrument. Each counterpart may consist of a
number of copies each signed by less than all, but together signed by all, the
parties hereto.
(n) Expenses. Except as may otherwise be agreed in any agreement
--------
between Parent and Liberty (solely with respect to such parties), Parent,
Liberty and each Stockholder shall be responsible for its, his or her own
expenses incurred in connection with this Agreement and the transactions
contemplated hereby.
<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first above written.
AT&T CORP.
By: /s/ Daniel E. Somers
--------------------
Name: Daniel E. Somers
Title: Senior Executive Vice President
and CFO
LIBERTY MEDIA CORPORATION
By: /s/ Charles Y. Tanabe
---------------------------------
Name: Charles Y. Tanabe
Title: Senior Vice President and
General Counsel
STOCKHOLDERS:
/s/ Myles P. Berkman
--------------------
Myles P. Berkman
/s/ David J. Berkman
--------------------
David J. Berkman
/s/ Lillian R. Berkman
----------------------
Lillian R. Berkman
Estate of Jack N. Berkman
By: /s/ Miles P. Berkman
--------------------
Myles P. Berkman, as
Executor
<PAGE>
/s/ Lillian R. Berkman
----------------------
Lillian R. Berkman, as
Executor
/s/ Lillian R. Berkman
----------------------
Donald H. Jones,
as Executor
Sybiel B. Berkman Foundation
By: /s/ Myles P. Berkman
--------------------
Myles P. Berkman,
as Trustee
Monroe E. Berkman Family
Limited Partnership
By: /s/ Myles P. Berkman
--------------------
Myles P. Berkman, as
General Partner
Stephen L. Berkman Trust
By: /s/ Lillian R. Berkman
----------------------
Lillian R. Berkman,
as Trustee
Monroe E. Berkman Trust
By: /s/ Lillian R. Berkman
----------------------
Lillian R. Berkman,
as Trustee
<PAGE>
Schedule I
<TABLE>
<CAPTION>
Company Class A
Stockholder Common Stock
- ----------- ---------------
<S> <C>
David J. Berkman 13,626
Sybiel B. Berkman Foundation 200,000
Monroe E. Berkman Family Limited 270,938
Partnership
Estate of Jack N. Berkman 2,332,416
Lillian R. Berkman 450,000
Stephen L. Berkman Trust 125,802
Monroe E. Berkman Trust 125,802
Myles P. Berkman 681,642
---------
Total 4,200,226
</TABLE>
