Liberty Media adopts rights plan after Malone share exchange

Liberty Media (FWONA) acquired high-vote Series B common stock from entities related to John C. Malone in an exchange completed Nov. 4, and adopted a shareholder rights plan the same day.

Under the Exchange Agreement, the Malone Holders transferred 2,316,537 Series B shares for 602,302 Series A shares and 5,420,699 Series C shares. The exchanged Series B shares were cancelled and retired.

The Malone Holders' aggregate voting power declined to about 3%, and no holder of common stock holds more than 9% of voting power, based on shares outstanding as of Oct. 30, 2026.

A special committee of disinterested and independent directors approved the exchange.

Dr. Malone ceased to hold the title of Chairman Emeritus and will serve as Senior Advisor; his employment agreement was amended accordingly.

Rights plan terms

The board declared a dividend of one preferred share purchase right for each outstanding share of Series A, Series B and Series C common stock, payable to holders of record at the close of business on Nov. 16, 2026.

Each right entitles its holder to buy one ten-thousandth of a share of Series A Junior Participating Preferred Stock at $426.00. Rights become exercisable after a person or group acquires 10% or more of the voting power, or 15% for a passive institutional investor. The rights expire on Nov. 3, 2027.

Chase Carey, chair of the special committee, said the transaction "helps to align John's voting power with his economic ownership of Liberty Media."

Chairman stock options

Robert R. Bennett, Chairman of the Board, entered into a Stock Option Award and Settlement Agreement with the company. His outstanding Series B options will vest in full and be cancelled for cash based on the excess of fair market value over exercise price. He will also receive new options to buy 600,000 Series A shares and 60,000 Series C shares, vesting 20% on the grant date and 20% on each of the first four anniversaries.