Company: LBRDK
Filing Date: 2025-01-22
Form Type: DEFM14A
Source: 0001140361-25-001609
Chunk: 157

Company: Liberty Broadband Corp
Filing Date: 2025-01-22
Form: DEFM14A
Chunk 157
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 the tax benefit arising from the additional tax gain corresponding to any cash tax payable in excess of such threshold under principles similar to a tax receivables agreement, (iii) limitations on Liberty Broadband’s and GCI’s ability to grant additional equity awards and make other changes to benefit plans, and (iv) the structure and terms of Liberty Broadband’s participation in Charter’s buybacks in a tax efficient manner and in an amount of at least $100 million per month to pay down Liberty Broadband’s debt between signing and closing. The parties reached preliminary agreement on certain terms, including that the outstanding Liberty Broadband stock options would be cancelled and converted into Charter common stock at the time of closing, as initially proposed by Charter, rather than rolling into comparable Charter options, and that Liberty Broadband would not grant additional equity awards during the interim period except for $5 million in restricted stock unit awards and no restrictions on its ability to grant restricted stock unit awards to GCI employees that will convert into GCI awards in connection with the spin-off. With respect to the GCI divestiture, Mr. Malone agreed that he would be supportive of the divestiture occurring via a spin-off rather than a cash sale, subject to agreement on the principles of the separation, and that he would be willing to consider supporting a tax receivables agreement for any cash tax payable above an agreed threshold. The parties understood that each would continue considering the discussed provisions. Following the meeting, Messrs. Winfrey and Markley reported the discussion to Charter management and representatives of each of Citi, Centerview and Wachtell Lipton.

Later that day, on behalf of the Charter special committee, Wachtell Lipton sent revised drafts of the merger agreement and the Malone voting agreement to O’Melveny. The revised merger agreement reflected the terms discussed among Messrs. Markley, Winfrey and Malone with regard to equity awards and GCI, and included, among other modifications (i) the reinsertion of a material adverse effect condition to closing, (ii) an exception to the Charter no-shop obligation for certain excluded alternative proposals that would not prevent the consummation of the proposed transaction with Liberty Broadband, and (iii) limitations on Liberty Broadband and GCI operations during the period between signing and closing. The revised Malone voting agreement eliminated the ratchet-down provision applicable to the voting commitment in the event the Liberty Broadband Board changed its recommendation in favor of the deal, and narrowed Liberty Broadband’s (and, following the