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Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of _______, 1999 (this
"Agreement"), among General Instrument Corporation, a Delaware corporation
("General Instrument"), Xxxxxxx Xxxxx Investors LLC, a Delaware limited
liability company ("Xxxxxxx Xxxxx"), Next Level Communications, a California
corporation and a wholly owned subsidiary of General Instrument ("NLC CA"), Next
Level Communications L.P., a Delaware limited partnership (the "Partnership"),
and Next Level Communications, Inc., a Delaware corporation and a wholly owned
subsidiary of the Partnership ("NLC DE").
NLC CA's authorized capital stock consists of 33 1/3 shares of
common stock, all of which are outstanding and held by General Instrument.
Xxxxxxx Xxxxx and NLC CA are parties to the Limited
Partnership Agreement dated as of January 13, 1998 (as amended, the "Partnership
Agreement"), under which Xxxxxxx Xxxxx holds a 9.576% general partnership
interest in the Partnership (the "GP Interest") and NLC CA holds a 90.424%
limited partnership interest in the Partnership (the "LP Interest").
NLC DE was formed by the Partnership on August 24, 1999 for
the purpose of effecting the transactions contemplated hereby and an initial
public offering (the "Initial Public Offering") of the common stock of a
successor corporation to the Partnership.
NLC DE's authorized capital stock consists of 200 million
shares of Common Stock, par value $.01 per share (the "Common Stock"), 70
million shares of Class B Non-Voting Common Stock, par value $.01 per share (the
"Class B Common Stock"), and 10 million shares of preferred stock, par value
$.01 per share, of which 100 shares of Common Stock are outstanding and held by
the Partnership. The terms of such classes of capital stock are set forth in the
certificate of incorporation of NLC DE attached hereto as Exhibit A.
The boards of directors and the stockholders of NLC CA and NLC
DE and the partners of the Partnership have approved and adopted this Agreement
in accordance with the California General Corporation Law (the "CGCL"), the
Delaware General Corporation Law (the "DGCL"), and Delaware Revised Uniform
Limited Partnership Act (the "DRULPA").
Contemporaneously with the execution and delivery of this
Agreement, General Instrument and NLC DE are entering into a Voting Trust
Agreement in the form of Exhibit B (the "Voting Trust Agreement") with Xxxxx
Xxxxxx Shareholder Services, LLC, as voting trustee (the "Voting Trustee").
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NOW, THEREFORE, the parties agree as follows:
ARTICLE I
THE MERGERS
1.1. Partnership Note. Simultaneously with the consummation of
the Partnership Merger (as defined below), General Instrument shall contribute
to NLC DE all of the indebtedness under the 8% Note due 2005 of the Partnership
held by General Instrument (the "Partnership Note") in exchange for a number of
validly issued, fully paid and non-assessable shares of Common Stock (the
certificate for which shares shall be issued to and in the name of the Voting
Trustee) equal to the amount of indebtedness outstanding under the Partnership
Note (including accrued and unpaid interest) at such time divided by the per
share initial public offering price of Common Stock pursuant to the Initial
Public Offering.
1.2. The Partnership Merger. Simultaneously with the
contribution of the Partnership Note, at the Effective Time of the Partnership
Merger, the Partnership shall be merged with and into NLC DE in accordance with
the DGCL and DRULPA (the "Partnership Merger"). From and after the Effective
Time of the Partnership Merger, the separate partnership existence of the
Partnership shall cease and NLC DE shall continue as the surviving entity under
the name "Next Level Communications, Inc." (the "Surviving Entity"). From and
after the Effective Time of the Partnership Merger, the Surviving Entity shall
possess all of the rights, privileges, immunities, powers and purposes, and be
subject to all of the liabilities, obligations and penalties, of the Partnership
and NLC DE, all as provided under applicable law.
1.3. Conversion Pursuant to the Partnership Merger. As of the
Effective Time of the Partnership Merger, by virtue of the Partnership Merger
and without any action on the part of any party hereto:
(a) Each share of Common Stock issued and outstanding
immediately prior to the Effective Time of the Partnership Merger
(which shall not include the shares of Common Stock simultaneously
being issued pursuant to Section 1.1) shall be canceled and retired
without any conversion thereof.
(b) The GP Interest shall be canceled and converted into and
become 5,863,329 validly issued, fully paid and non-assessable shares
of Common Stock. NLC DE shall cause to be delivered certificate(s) for
such shares to and in the name of Xxxxxxx Xxxxx or its designees or
transferees in the denominations requested by Xxxxxxx Xxxxx.
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(c) The LP Interest shall be canceled and converted into and
become a number (the "LP Interest Share Number") of validly issued,
fully paid and non-assessable shares of Class B Common Stock equal to
the sum of (i) 55,366,091 and (ii) $88 million divided by the per share
initial public offering price of Common Stock pursuant to the Initial
Public Offering. NLC DE shall cause to be delivered a certificate for
such shares to and in the name of NLC CA.
1.4. Certificate of Incorporation and By-laws of the Surviving
Entity. The certificate of incorporation of NLC DE shall be the certificate of
incorporation of the Surviving Entity after the Effective Time of the
Partnership Merger, until amended in accordance with applicable law. The by-laws
of NLC DE shall be the by-laws of the Surviving Entity after the Effective Time
of the Partnership Merger, until amended in accordance with applicable law.
1.5. Directors and Officers of the Surviving Entity. The
directors and officers of NLC DE at the Effective Time of the Partnership Merger
shall be the directors and officers of the Surviving Entity after the Effective
Time of the Partnership Merger, until expiration of their current terms, or
their prior resignation, removal or death, subject to the certificate of
incorporation and the by-laws of the Surviving Entity.
1.6. Voting Trust. Immediately after the Effective Time of the
Partnership Merger, General Instrument shall deposit with the Voting Trustee all
of the outstanding shares of common stock of NLC CA pursuant to and in
accordance with the Voting Trust Agreement.
1.7. The NLC Merger. Immediately after the Effective Time of
the Partnership Merger and the transaction contemplated by Section 1.6, at the
Effective Time of the NLC Merger (as defined below), NLC CA shall be merged with
and into the Surviving Entity in accordance with the DGCL and the CGCL (the "NLC
Merger"; together with the Partnership Merger, the "Mergers"). From and after
the Effective Time of the NLC Merger, the separate corporate existence of NLC CA
shall cease and the Surviving Entity shall continue as the surviving corporation
under the name "Next Level Communications, Inc." (the "Surviving Corporation").
From and after the Effective Time of the NLC Merger, the Surviving Corporation
shall possess all of the rights, privileges, immunities, powers and purposes,
and be subject to all of the liabilities, obligations and penalties, of NLC CA
and the Surviving Entity, all as provided under applicable law.
1.8. Conversion Pursuant to the NLC Merger. As of the
Effective Time of the NLC Merger, by virtue of the NLC Merger and without any
action on the part of any party hereto:
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(a) Each share of Common Stock issued and outstanding
immediately prior to the Effective Time of the NLC Merger shall remain
outstanding as one share of Common Stock.
(b) Each share of Class B Common Stock issued and outstanding
immediately prior to the Effective Time of the NLC Merger shall be
canceled and retired without any conversion thereof.
(c) Each share of common stock of NLC CA issued and
outstanding immediately prior to the Effective Time of the NLC Merger
shall be canceled and converted into and become a number of validly
issued, fully paid and non-assessable shares of Common Stock equal to
the LP Interest Share Number divided by 33 1/3. NLC DE shall cause to
be delivered a certificate for such shares to and in the name of the
Voting Trustee.
1.9. Certificate of Incorporation and By-laws of the Surviving
Corporation. The certificate of incorporation of the Surviving Entity shall be
the certificate of incorporation of the Surviving Corporation after the
Effective Time of the NLC Merger, until amended in accordance with applicable
law. The by-laws of the Surviving Entity shall be the by-laws of the Surviving
Corporation after the Effective Time of the NLC Merger, until amended in
accordance with applicable law.
1.10. Directors and Officers of the Surviving Corporation. The
directors and officers of the Surviving Entity at the Effective Time of the NLC
Merger shall be the directors and officers of the Surviving Corporation after
the Effective Time of the NLC Merger, until expiration of their current terms,
or their prior resignation, removal or death, subject to the certificate of
incorporation and the by-laws of the Surviving Corporation.
1.11. Effective Time. The Partnership Merger shall become
effective (the "Effective Time of the Partnership Merger") upon the due filing
of a certificate of merger with the Secretary of State of Delaware in accordance
with the DGCL and the DRULPA, or at such later time as is specified in such
certificate of merger. The NLC Merger shall become effective (the "Effective
Time of the NLC Merger") upon the due filing of certificates of merger with the
Secretary of State of Delaware and the Secretary of State of California in
accordance with the DGCL and the CGCL, or at such later time as is specified in
such certificate of merger.
1.12. Treatment of Employee Stock Options. Prior to the
Effective Time of the NLC Merger, the Board of Directors of NLC CA shall take
appropriate actions so that, at the Effective Time of the NLC Merger, each of
the employee stock options
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previously issued by NLC CA which is outstanding immediately prior to the
Effective Time of the NLC Merger shall be converted automatically pursuant to
the NLC Merger into an option to purchase the same number of shares of Common
Stock at the same exercise price.
1.13. Warrant. By operation of the NLC Merger, the option
contemplated by Section 10.2 of the Limited Partnership Agreement shall be
converted automatically into a Warrant of NLC DE. To further evidence such
conversion, NLC DE and Xxxxxxx Xxxxx shall enter into the Warrant Agreement in
the form of Exhibit C hereto.
ARTICLE II
CONDITIONS
Consummation of the transactions contemplated hereby is
subject to the satisfaction at or before the Effective Time of the Partnership
Merger of the following conditions:
2.1. Registration Statement. The registration statement
relating to the Initial Public Offering shall have been declared effective under
the Securities Act of 1933, as amended.
2.2. Underwriting Agreement. All conditions required to be
satisfied under the underwriting agreement relating to the Initial Public
Offering (other than the Mergers and the other transactions contemplated by
Article I) shall have been satisfied and the parties to such underwriting
agreement shall be willing and prepared to immediately consummate the Initial
Public Offering.
ARTICLE III
MISCELLANEOUS
3.1. Termination. At any time prior to the Effective Time of
the Partnership Merger, subject to the letter agreement dated September 14, 1999
among General Instrument, Motorola, Inc. and Xxxxxxx Xxxxx, this Agreement may
be terminated by General Instrument.
3.2. Amendment. This Agreement may be amended at any time by a
written instrument executed by each of the parties hereto only.
3.3. Further Assurances. Each of NLC CA and Xxxxxxx Xxxxx
(in its capacity as the general partner of the Partnership only) shall at any
time, or from time to time, as and when
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requested by the Surviving Corporation, execute and deliver, or cause to be
executed and delivered in its name, all such conveyances, assignments,
transfers, deeds or other instruments, and shall take, or cause to be taken,
such further or other action in order to evidence the transfer, vesting or
devolution of any property, right, privilege, immunity, power or purpose, or to
vest or perfect or confirm to the Surviving Corporation title to and possession
of all the properties, rights, privileges, immunities, powers and purposes of
NLC CA or the Partnership, as the case may be, and otherwise to carry out the
intent and purposes hereof.
3.4. Reorganization. The parties hereto intend the Mergers to
qualify as a tax-free reorganization under the Internal Revenue Code.
3.5. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed by its respective officers hereunto duly authorized all
as of the date first above written.
GENERAL INSTRUMENT CORPORATION
By: ________________________________________
Name:
Title:
XXXXXXX XXXXX INVESTORS LLC
By: ________________________________________
Name:
Title:
NEXT LEVEL COMMUNICATIONS
By: ________________________________________
Name:
Title:
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NEXT LEVEL COMMUNICATIONS L.P.
By: Xxxxxxx Xxxxx Investors LLC,
its General Partner
By: ________________________________________
Name:
Title:
NEXT LEVEL COMMUNICATIONS, INC.
By: ________________________________________
Name:
Title:
