TWE Registration-Rights Process Suspended

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AOL Time Warner Inc. and AT&T Corp. have agreed to temporarily suspend
the registration-rights process concerning AT&T's 25.6 percent stake in Time
Warner Entertainment so that the two parties and Comcast Corp. can pursue
discussions regarding an alternate transaction.

In a prepared statement Tuesday, AOL Time Warner and AT&T also said they
have asked Banc of America Securities LLC 'not to deliver an opinion on how much
AT&T's stake in Time Warner Entertainment is worth and how much of that
stake could be sold in a public offering.'

According to sources familiar with the companies, the parties could reach an
agreement in as soon as two weeks.

The joint announcement comes on the heels of reports that AT&T has been
asking for $1 billion in cash in addition to having its equity stake in the
partnership sold to the public in an initial public offering.

TWE's assets include most of Time Warner Cable's systems, Home Box Office and
Warner Bros. Studios.

According to reports, AOL Time Warner has been pushing for AT&T to swap
its TWE interest for a stake in a newly created Time Warner Cable. AT&T --
which is expected to close its pending merger with Comcast Corp. by the end of
the year -- could then sell that Time Warner Cable stake to the public.

Sources confirmed reports that AT&T is asking for a $1 billion cash
payment in addition to the Time Warner Cable stake due to the sluggish market
for cable stocks.

A source familiar with the parties said it has been common knowledge that the
telephone giant would ask for a cash component in unwinding the partnership.

'[AT&T] has made it pretty clear that they are definitely looking for
cash out of any agreement that takes place,' the source said, adding that there
is still a possibility that no agreement will be reached.

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