The consequences of the American Telephone & Telegraph breakup were reported incorrectly Tuesday. For every 10 shares of AT&T stock owned, shareholders will receive one share in each of the seven regional phone companies formed after the breakup and also will retain the 10 shares of AT&T stock. Shareholders will receive cash for numbers of shares not divisible by 10.

Merrill Lynch, Pierce, Fenner & Smith Inc. has designed a unit trust for American Telephone & Telegraph Co. shareholders that will provide participants with interests in each of the new Bell System phone companies.

Under the program, investors will be able, as of Aug. 4, to tender AT&T shares for units in the trust until Jan. 1, when AT&T's 22 local phone companies are scheduled to be divested from the Bell System and to form seven regional telephone firms. Merrill Lynch will charge 1 1/2 percent for the exchange service, a figure that will rise to 2.9 percent after Jan. 1.

After the local companies are split off, AT&T will consist of its long-distance, manufacturing, research and marketing arms, under the terms of a 1982 antitrust settlement with the government.

Formation of the fund--apparently the first of its kind to become operational--comes at a time of widespread uncertainty among investors and securities analysts about the market value of the newly formed regional phone firms and the remaining pieces of AT&T.

AT&T shareholders can hold their AT&T stock and receiving one share of each of the seven regional companies and one AT&T share in exchange for every 10 shares of AT&T stock they hold. Holders of numbers of AT&T shares not cleanly divisible by 10 will receive cash for their fractional holdings.

According to Merrill Lynch officials, the fund will simplify recordkeeping, provide monthly income statements and monthly net dividend payments, and prevent tax and other problems arising from the cash payments that shareholders would receive from AT&T if they own a total number of shares not divisible by 10.