Exhibit 2
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REGISTRATION RIGHTS AGREEMENT
between
GENERAL INSTRUMENT CORPORATION,
GI CORPORATION
INSTRUMENT PARTNERS
and
FORSTMANN LITTLE & CO. SUBORDINATED DEBT
AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV
Dated as of April 6, 1992
REGISTRATION RIGHTS AGREEMENT, dated as of April 6, 1992,
between GENERAL INSTRUMENT CORPORATION, a Delaware corporation
("Parent"), GI CORPORATION, a Delaware corporation (the "Company") and
wholly owned subsidiary of Parent, INSTRUMENT PARTNERS, a New York
limited partnership ("Instrument Partners"), and FORSTMANN LITTLE &
CO. SUBORDINATED DEBT AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV, a
New York limited partnership ("MBO-IV"). (MBO-IV and Investment
Partners are individually referred to as a "Forstmann Little Company"
and collectively referred to as the "Forstmann Little Companies ".)
Parent is proposing to register and offer to the public
shares of Common Stock, par value $.01 per share, of Parent. The
proposed offering of shares to the public (the "Offering") will be
made pursuant to a registration statement on Form S-1 to be filed by
Parent to register such shares under the Securities Act (as defined
below). Parent Intends to contribute the net proceeds from the
Offering to the Company, which would use such net proceeds to repay a
portion of its outstanding bank indebtedness.
Instrument Partners and MBO-IV each own shares of Common
Stock (as hereinafter defined). If either of the Forstmann Little
Companies desires to sell shares of Common Stock after the Offering,
it may be necessary to register such shares under the Securities Act.
In addition, Parent has entered into certain subscription agreements
and stock option agreements (and upon exercise of the option
thereunder, will enter into stockholder's agreements) with each of the
Management Investors (as hereinafter defined). Pursuant to the terms
of such subscription agreements, stock option agreements and
stockholder's agreements, the Management Investors generally have the
right to participate proportionately (and the Forstmann Little
Companies must allow such persons to participate proportionately) in
any public offering of all or a portion of the shares of Common Stock
owned by the Forstmann Little Companies. The number of shares of
Common Stock held by any Management Investor to be so included in any
such public offering shall be determined in accordance with the
subscription agreement, stock option agreement or stockholder's
agreement, as the case may be, between such Management Investor and
Parent. Pursuant to the terms of such subscription agreement, option
agreement or stockholder's agreement, Parent must cause such shares to
be included in any such public offering.
In view of the foregoing and in consideration of the
services provided by the General Partner of Instrument Partners and
MBO-IV, together with Forstmann Little Co., in negotiating and
assisting in the registration of Parent's Shares of Common Stock in
the Offering and in negotiating with the Company's bank lenders,
Parent hereby grants to the Forstmann Little Companies certain
registration and other rights with respect to their shares of Common
Stock.
Accordingly, the parties hereto agree as follows:
1. Definitions. As used herein, unless the context otherwise
requires, the following terms have the following respective meanings:
"Certificate of Incorporation" means the Amended and
Restated Certificate of Incorporation of Parent, as may be amended
hereafter from time to time.
"Commission" means the Securities and Exchange Commission or
any other Federal agency at the time administering the Securities Act.
"Common Stock" means any Common Stock, par value $.0l per
share, of Parent now or hereafter authorized to be issued, and any and
all securities of any kind whatsoever of Parent which may be issued on
or after the date hereof (i) in respect of, or in exchange for, shares
of Common Stock pursuant to a merger, consolidation, stock split,
stock dividend, recapitalization of Parent or otherwise, or (ii) in
exchange for Class B Common Stock, par value $.01 per share, of the
Company pursuant to the Certificate of Incorporation.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any similar Federal statute, and the rules and regulations
of the Commission thereunder, all as the same shall be in effect at
the time. Reference to a particular section of the Exchange Act shall
include a reference to the comparable section, if any, of any such
similar Federal statute.
"Management Investor" means each Person who, at the time of
any registration of Common Stock hereunder, has the right under a
subscription agreement, stock option agreement or stockholder's
agreement with Parent to participate in any public offering of all or
a portion of the shares of Common Stock owned by the Forstmann Little
Companies.
"Person" means a corporation, an association, a partnership,
an organization, a business, a trust, an individual, or any other
entity or organization, including a government or political
subdivision or an instrumentality or agency thereof.
"Registrable Securities" means (i) any shares of Common
Stock owned by the Forstmann Little Companies on the date of this
Agreement, (ii) any shares of Common Stock issued pursuant to the
terms of a subscription agreement, issuable upon exercise on an option
pursuant to the terms of a stock option agreement or held pursuant to
the terms of a stockholder's agreement, as the case may be, between
any Management Investor and Parent, and (iii) any Common Stock issued
with respect to the Common Stock referred to in clauses (i) or (ii) by
way of a stock dividend, stock split or reverse stock split or in
connection with a combination of shares, recapitalization, merger,
consolidation or otherwise. As to any particular Registrable
Securities, such securities shall cease to be Registrable Securities
(a) when a registration statement with respect to the sale of such
securities shall have become effective under the Securities Act and
such securities shall have been disposed of in accordance with such
registration statement, (b) when such securities shall have been
otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by Parent and
subsequent public distribution of them shall not require registration
of them under the Securities Act, or (c) when such securities shall
have been sold as permitted by, and in compliance with, the Securities
Act. Any certificate evidencing the Registrable Securities shall bear
a legend stating that the securities have not been registered under
the securities Act and setting forth or referring to the restrictions
on transferability and sale of the securities.
"Registration Expenses" means all expenses incident to the
registration and disposition of the Registrable Securities pursuant to
Section 2 hereof, including, without limitation, all registration,
filing and applicable national securities exchange fees, all fees and
expenses of complying with state securities or blue sky laws
(including fees and disbursements of counsel to the underwriters or
the Forstmann Little Companies in connection with "blue sky"
qualification of the Registrable Securities and determination of their
eligibility for investment under the laws of the various
jurisdictions), all word processing, duplicating and printing
expenses, all messenger and delivery expenses, the fees and
disbursements of counsel for Parent and of its independent public
accountants, including the expenses of "cold comfort" letters or any
special audits required by, or incident to, such registration, all
fees and disbursements of underwriters (other than underwriting
discounts and commissions), all transfer taxes, and the fees and
expenses of counsel to the Forstmann Little Companies; provided,
however, that Registration Expenses shall exclude and the Forstmann
Little Companies and the Management Investors shall pay underwriting
discounts and commissions in respect of the Registrable Securities
being registered.
"Securities Act" means the Securities Act of 1933, or any
similar Federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
References to a particular section of the Securities Act shall include
a reference to the comparable section, if any, of any such similar
Federal statute.
2. Registration Under Securities Act, etc.
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2.1 Registration on Request.
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(a) Request. At any time or from time to time, the
Forstmann Little Companies, individually and jointly, shall have the
right to require Parent to effect the registration under the
Securities Act of all or part of the Registrable Securities, by
delivering a written request therefor to Parent specifying the number
of shares of Registrable Securities and the intended method of
distribution. Parent shall, as expeditiously as possible, use its best
efforts to (i) effect the registration under the Securities Act
(including by means of a shelf registration pursuant to Rule 415 under
the Securities Act if so requested in such request and if Parent is
then eligible to use such a registration) of the Registrable
Securities which Parent has been so requested to register by the
Forstmann Little Companies, for distribution in accordance with the
intended method of distribution set forth in the written request
delivered by the Forstmann Little Companies, and (ii) if requested by
the Forstmann Little Companies, obtain acceleration of the effective
date of then registration statement relating to such registration.
(b) Registration of Other Securities. Whenever
Parent shall effect a registration pursuant to this Section 2.1 in
connection with an underwritten offering by any Forstmann Little
Company and any Management Investors of Registrable Securities, no
securities other than Registrable Securities shall be included among
the securities covered by such registration unless the Forstmann
Little Company or Companies so registering Registrable Securities
shall have consented in writing to the inclusion therein of such other
securities, which consent may be subject to terms and conditions
determined by such Forstmann Little Company or Companies in its or
their sole discretion.
(c) Registration Statement Form. Registrations
under this Section 2.1 shall be on such appropriate registration form
of the Commission as shall be selected by Parent and as shall be
reasonably acceptable to the Forstmann Little Companies. Parent agrees
to include in any such registration statement all information which,
in the opinion of counsel to the Forstmann Little Companies and
counsel to Parent, is required to be included.
(d) Expenses. Parent will pay all Registration
Expenses in connection with any registration requested pursuant to
this Section 2.1.
(e) Effective Registration Statement. A
registration requested pursuant to this Section 2.1 shall not be
deemed to have been effected (including for purposes of paragraph (h)
of this Section 2.1) (i) unless a registration statement with respect
thereto has become effective and has been kept continuously effective
for a period of at least 120 days (or such shorter period which shall
terminate when all the Registrable Securities covered by such
registration statement have been sold pursuant thereto), (ii) if after
it has become effective, such registration is interfered with by any
stop order, injunction or other order or requirement of the Commission
or other governmental agency or court for any reason not attributable
to the Forstmann Little Companies and has not thereafter become
effective, or (iii) if the conditions to closing specified in the
underwriting agreement, if any, entered into in connection with such
registration are not satisfied or waived, other than by reason of a
failure on the part of the Forstmann Little Companies.
(f) Selection of Underwriters. The underwriters of
each underwritten offering of the Registrable Securities so to be
registered shall be selected by the Forstmann Little Companies.
(g) Right to Withdraw. If the managing underwriter
of any underwritten offering shall advise the Forstmann Little
Companies that the Registrable Securities covered by the registration
statement cannot be sold in such offering within a price range
acceptable to the Forstmann Little Companies, then the Forstmann
Little Companies shall have the right to notify Parent in writing that
they have determined that the registration statement be abandoned or
withdrawn, in which event Parent shall abandon or withdraw such
registration statement. In the event of such abandonment or
withdrawal, such request shall not be counted for purposes of the
requests for registration to which the Forstmann Little Companies are
entitled pursuant to this Section 2.1.
(h) Limitations on Registration on Request. The
Forstmann Little Companies shall be entitled to require Parent to
effect, and Parent shall be required to effect, six registrations
pursuant to this Section 2.1, provided, however, that the aggregate
offering value of the shares to be registered shall be at least
$25,000,000 unless the Forstmann Little Companies then own shares with
a value less than $25,000,000.
(i) Postponement. Parent shall be entitled once in
any six-month period to postpone for a reasonable period of time (but
not exceeding 90 days) (the "Postponement Period") the filing of any
registration statement required to be prepared and filed by it
pursuant to this Section 2.1 if Parent determines, in its reasonable
judgment, that such registration and offering would materially
interfere with any material financing, corporate reorganization or
other material transaction involving Parent or any subsidiary, or
would require premature disclosure thereof, and promptly gives the
Forstmann Little Companies written notice of such determination,
containing a general statement of the reasons for such postponement
and an approximation of the anticipated delay. If Parent shall so
postpone the filing of a registration statement, the Forstmann Little
Companies shall have the right to withdraw the request for
registration by giving written notice to Parent at any time and, in
the event of such withdrawal, such request shall not be counted for
purposes of the requests for registration to which the Forstmann
Little Companies are entitled pursuant to this Section 2.1.
2.2 Incidental Registration.
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(a) Right to Include Registrable Securities. If
Parent at any time proposes to register any of its securities under
the Securities Act by registration on Form X-0, X-0 or S-3 or any
successor or similar form(s) (except registrations on such Form or
similar form(s) solely for registration of securities in connection
with an employee benefit plan or dividend reinvestment plan or a
merger or consolidation), whether or not for sale for its own account,
it will each such time give prompt written notice to the Forstmann
Little Companies of its intention to do so and of the Forstmann Little
Companies' rights under this Section 2.2. Upon the written request of
the Forstmann Little Companies (which request shall specify the
maximum number of Registrable Securities intended to be disposed of by
the Forstmann Little Companies and the Management Investors), made as
promptly as practicable and in any event within 30 days after the
receipt of any such notice (15 days if Parent states in such written
notice or gives telephonic notice to the Forstmann Little Companies,
with written confirmation to follow promptly thereafter, stating that
(i) such registration will be on Form S-3 and (ii) such shorter period
of time is required because of a planned filing date), Parent shall
use its best efforts to effect the registration under the Securities
Act of all Registrable Securities which Parent has been so requested
to register by the Forstmann Little Companies; provided, however, that
if, at any time after giving written notice of its intention to
register any securities and prior to the effective date of the
registration statement filed in connection with such registration,
Parent shall determine for any reason not to register or to delay
registration of such securities, Parent shall give written notice of
such determination and its reasons therefor to the Forstmann Little
Companies and (i) in the case of a determination not to register,
shall be relieved of its obligation to register any Registrable
Securities in connection with such registration (but not from any
obligation of Parent to pay the Registration Expenses in connection
therewith), without prejudice, however, to the rights of the Forstmann
Little Companies to request that such registration be effected as a
registration under Section 2.1 and (ii) in the case of a determination
to delay registering, shall be permitted to delay registering any
Registrable Securities, for the same period as the delay in
registering such other securities. No registration effected under this
Section 2.2 shall relieve Parent of its obligation to effect any
registration upon request under Section 2.1. Parent will pay all
Registration Expenses in connection with any registration of
Registrable Securities requested pursuant to this Section 2.2.
(b) Right to Withdraw. The Forstmann Little
Companies shall have the right to withdraw their request for inclusion
of its Registrable Securities in any registration statement pursuant
to this Section 2.2 at any time by giving written notice to Parent of
its request to withdraw.
(c) Priority in Incidental Registrations. If the
managing underwriter of any underwritten offering shall inform Parent
by letter of its belief that the number of Registrable Securities
requested to be included in such registration, when added to the
number of other securities to be offered in such registration, would
materially adversely affect such offering, then Parent shall include
in such registration, to the extent of the number and type which
Parent is so advised can be sold in (or during the time of) such
offering without so materially adversely affecting such offering (the
"Section 2.2 Sale Amount"), (i) all of the securities proposed by
Parent to be sold for its own account; (ii) thereafter, to the extent
the Section 2.2 Sale Amount is not exceeded, the Registrable
Securities requested by the Forstmann Little Companies to be included
in such registration pursuant to Section 2.2 (a) (including
Registrable Securities held by Management Investors); and (iii)
thereafter, to the extent the Section 2.2 Sale Amount is not exceeded,
any other securities of Parent requested to be included in such
registration by any holder thereof, including, in the case where such
registration in to be effected as a result of the exercise by a holder
of Parent's securities of such holder's right to cause such securities
to be so registered, the securities of such holder.
(d) Plan of Distribution. Any participation by
holders of Registrable Securities in a registration by Parent shall be
in accordance with Parent's plan of distribution, provided that the
Forstmann Little Companies shall have the right to select the
co-managing underwriter.
2.3 Registration Procedures. If and whenever Parent in
required to use its best efforts to affect the registration of any
Registrable Securities under the Securities Act as provided in
Sections 2.1 and 2.2 hereof, Parent shall as expeditiously as
possible:
(a) prepare and file with the Commission as soon as
practicable the requisite registration statement to effect such
registration (and shall include all financial statements required
by the Commission to be filed therewith) and thereafter use its
best efforts to cause such registration statement to become
effective; provided, however, that before filing such
registration statement (including all exhibits) or any amendment
or supplement thereto or comparable statements under securities
or blue sky laws of any jurisdiction, Parent shall furnish such
documents to the Forstmann Little Companies and each underwriter,
if any, participating in the offering of the Registrable
Securities and their respective counsel, which documents will be
subject to the review and comments of the Forstmann Little
Companies, each underwriter and their respective counsel; and
provided, further, however, that Parent may discontinue any
registration of its securities which are not Registrable
Securities at any time prior to the effective data of the
registration statement relating thereto;
(b) notify the Forstmann Little Companies of the
Commission's requests for amending or supplementing the
registration statement and the prospectus, and prepare and file
with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Securities Act
with respect to the disposition of all Registrable Securities
covered by such registration statement for such period as shall
be required for the disposition of all of such Registrable
Securities in accordance with the intended method of distribution
thereof; provided, that except with respect to any such
registration statement filed pursuant to Rule 415 under the
Securities Act, such period need not exceed 120 days;
(c) furnish, without charge, to the Forstmann Little
Companies and each underwriter such number of conformed copies of
such registration statement and of each such amendment and
supplement thereto (in each case including all exhibits), such
number of copies of the prospectus contained in such registration
statement (including each preliminary prospectus and any summary
prospectus) and any other prospectus filed under Rule 424 under
the Securities Act, in conformity with the requirements of the
Securities Act, and such other documents, as the Forstmann Little
Companies and such underwriters may reasonably request;
(d) use its best efforts (i) to register or qualify all
Registrable Securities and other securities covered by such
registration statement under such securities or blue sky laws of
such States of the United States of America where an exemption is
not available and as the Forstmann Little Companies or any
managing underwriter shall reasonably request, (ii) to keep such
registration or qualification in effect for so long as such
registration statement remains in effect, and (iii) to take any
other action which may be reasonably necessary or advisable to
enable the Forstmann Little Companies to consummate the
disposition in such jurisdictions of the securities to be sold by
the Forstmann Little Companies, except that Parent shall not for
any such purpose be required to qualify generally to do business
as a foreign corporation in any jurisdiction wherein it would not
but for the requirements of this subsection (d) be obligated to
be so qualified or to consent to general service of process in
any such jurisdiction;
(e) use its best efforts to cause all Registrable Securities
covered by such registration statement to be registered with or
approved by such other federal or state governmental agencies or
authorities as may be necessary in the opinion of counsel to
Parent and counsel to the Forstmann Little Companies to
consummate the disposition of such Registrable Securities;
(f) furnish to the Forstmann Little Companies and each
underwriter, if any, participating in the offering of the
securities covered by such registration statement, a signed
counterpart of
(i) an opinion of counsel for Parent, and
(ii) a "comfort" letter signed by the independent
public accountants who have certified Parent's
financial statements included or incorporated by
reference in such registration statement,
covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and,
in the case of the accountants' comfort letter, with respect to
events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuer's counsel and in
accountants' comfort letters delivered to the underwriters in
underwritten public offerings of securities (and dated the dates
such opinions and comfort letters are customarily dated) and, in
the case of the legal opinion, such other legal matters, and, in
the case of the accountants' comfort letter, such other financial
matters, as the Forstmann Little Companies, or the underwriters,
may reasonably request;
(g) promptly notify the Forstmann Little Companies and each
managing underwriter, if any, participating in the offering of
the securities covered by such registration statement (i) when
such registration statement, any pre-effective amendment, the
prospectus or any prospectus supplement related thereto or
post-effective amendment to such registration statement has been
filed, and, with respect to such registration statement or any
post-effective amendment, when the same has become effective;
(ii) of any request by the Commission for amendments or
supplements to such registration statement or the prospectus
related thereto or for additional information; (iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of such registration statement or the initiation of
any proceedings for that purpose; (iv) of the receipt by Parent
of any notification with respect to the suspension of the
qualification of any of the Registrable Securities for sale under
the securities or blue sky laws of any jurisdiction or the
initiation of any proceeding for such purpose; (v) at any time
when a prospectus relating thereto is required to be delivered
under the Securities Act, upon discovery that, or upon the
happening of any event as a result of which, the prospectus
included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to
make the statements therein not misleading, in the light of the
circumstances under which they were made, and in the case of this
clause (v), at the request of the Forstmann Little Companies
promptly prepare and furnish to the Forstmann Little Companies
and each managing underwriter, if any, participating in the
offering of the Registrable Securities, a reasonable number of
copies of a supplement to or an amendment of such prospectus as
may be necessary so that, as thereafter delivered to the
purchasers of such securities, such prospectus shall not include
an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the
circumstances under which they were made; and (vi) at any time
when the representations and warranties of Parent contemplated by
Section 2.4(a) or (b) hereof cease to be true and correct;
(h) otherwise comply with all applicable rules and
regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, an earnings statement
covering the period of at least twelve months beginning with the
first full calendar month after the effective date of such
registration statement, which earnings statement shall satisfy
the provisions of Section 11(a) of the Securities Act and Rule
158 promulgated thereunder, and promptly furnish to the Forstmann
Little Companies a copy of any amendment or supplement to such
registration statement or prospectus;
(i) provide and cause to be maintained a transfer agent and
registrar (which, in each case, may be Parent) for all
Registrable Securities covered by such registration statement
from and after a date not later than the effective date of such
registration;
(j) (i) use its best efforts to cause all Registrable
Securities covered by such registration statement to be listed on
the principal securities exchange on which similar securities
issued by Parent are then listed (if any), if the listing of such
Registrable Securities is then permitted under the rules of such
exchange, or (ii) if no similar securities are then so listed,
use its best efforts to (x) cause all such Registrable Securities
to be listed on a national securities exchange or (y) failing
that, secure designation of all such Registrable Securities as a
National Association of Securities Dealers, Inc. Automated
Quotation System ("NASDAQ") "national market system security"
within the meaning of Rule 11Aa2-1 of the Commission or (z)
failing that, to secure NASDAQ authorization for such shares and,
without limiting the generality of the foregoing, to arrange for
at least two market makers to register as such with respect to
such shares with the National Association of Securities Dealers,
Inc.;
(k) deliver promptly to counsel to the Forstmann Little
Companies and each underwriter, if any, participating in the
offering of the Registrable Securities, copies of all
correspondence between the Commission and Parent, its counsel or
auditors and all memoranda relating to discussions with the
Commission or its staff with respect to such registration
statement;
(1) use its best efforts to obtain the withdrawal of any
order suspending the effectiveness of the registration statement;
(m) provide a CUSIP number for all Registrable Securities,
no later than the effective date of the registration statement;
and
(n) make available its employees and personnel and otherwise
provide reasonable assistance to the underwriters (taking into
account the needs of Parent's and the Company's businesses) in
their marketing of Registrable Securities.
Parent may require the Forstmann Little Companies to furnish Parent
such information regarding the Forstmann Little Companies and the
distribution of the Registrable Securities as Parent may from time to
time reasonably request in writing.
The Forstmann Little Companies agree that upon receipt of
any notice from Parent of the happening of any event of the kind
described in paragraph (g)(iii) or (v) of this Section 2.3, each of
the Forstmann Little Companies will, to the extent appropriate,
discontinue its disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until,
in the case of paragraph (g)(v) of this Section 2.3, its receipt of
the copies of the supplemented or amended prospectus contemplated by
paragraph (g)(v) of this Section 2.3 and, if so directed by Parent,
will deliver to Parent (at Parent's expense) all copies, other than
permanent file copies, then in its possession, of the prospectus
relating to such Registrable Securities current at the time of receipt
of such notice. If the disposition by the Forstmann Little Companies
of their securities is discontinued pursuant to the foregoing
sentence, Parent shall extend the period of effectiveness of the
registration statement by the number of days during the period from
and including the date of the giving of notice to and including the
date when the Forstmann Little Companies shall have received copies of
the supplemented or amended prospectus contemplated by paragraph
(g)(v) of this Section 2.3; and, if Parent shall not so extend such
period, the Forstmann Little Companies' request pursuant to which such
registration statement was filed shall not be counted for purposes of
the requests for registration to which the Forstmann Little Companies
are entitled pursuant to Section 2.1 hereof.
2.4 Underwritten Offerings.
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(a) Requested Underwritten Offerings. If requested
by the underwriters for any underwritten offering by the Forstmann
Little Companies (and any Management Investors) pursuant to a
registration requested under Section 2.1, Parent shall enter into a
customary underwriting agreement with a managing underwriter or
underwriters which is selected by the Forstmann Little Companies. Such
underwriting agreement shall be satisfactory in form and substance to
the Forstmann Little Companies and shall contain such representations
and warranties by, and such other agreements on the part of, Parent
and such other terms as are generally prevailing in agreements of that
type, including, without limitation, indemnities to the effect and to
the extent provided in Section 2.6 hereof. The Forstmann Little
Companies shall be parties to such underwriting agreement and may, at
their option, require that any or all of the representations and
warranties by, and the other agreements on the part of, Parent to and
for the benefit of such underwriters shall also be made to and for the
benefit of the Forstmann Little Companies and that any or all of the
conditions precedent to the obligations of such underwriters under
such underwriting agreement be conditions precedent to the obligations
of the Forstmann Little Companies. Neither Forstmann Little Company
shall be required to make any representations or warranties to or
agreements with Parent or the underwriters other than representations,
warranties or agreements regarding such Forstmann Little Company, its
ownership of and title to the Registrable Securities, and its intended
method of distribution; and any liability of either Forstmann Little
Company to any underwriter or other person under such underwriting
agreement shall be limited to liability arising from misstatements in
or omissions from its representations and warranties and shall be
limited to an amount equal to the net proceeds that it derives from
such registration.
(b) Incidental Underwritten Offerings. In the case
of a registration pursuant to Section 2.2 hereof, if Parent shall have
determined to enter into any underwriting agreements in connection
therewith, all of the Forstmann Little Companies' Registrable
Securities to be included in such registration shall be subject to
such underwriting agreements. The Forstmann Little Companies may, at
their option, require that any or all of the representations and
warranties by, and the other agreements on the part of, Parent to and
for the benefit of such underwriters shall also be made to and for the
benefit of the Forstmann Little Companies and that any or all of the
conditions precedent to the obligations of such underwriters under
such underwriting agreement be conditions precedent to the obligations
of the Forstmann Little Companies. Neither Forstmann Little Company
shall be required to make any representations or warranties to or
agreements with Parent or the underwriters other than representations,
warranties or agreements regarding such Forstmann Little Company, its
ownership of and title to the Registrable Securities, and its intended
method of distribution; and any liability of either Forstmann Little
Company to any underwriter or other person under such underwriting
agreement shall be limited to liability arising from misstatements in
or omissions from its representations and warranties and shall be
limited to an amount equal to the net proceeds that it derives from
such registration.
2.5 Preparation; Reasonable Investigation. In
connection with the preparation and filing of each registration
statement under the Securities Act pursuant to this Agreement, Parent
will give the Forstmann Little Companies, their underwriters, if any,
and their respective counsel, accountants and other representatives
and agents the opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with
the Commission, and, to the extent practicable, each amendment thereof
or supplement thereto, and give each of them such access to its books
and records and such opportunities to discuss the business of Parent
with its officers and employees and the independent public accountants
who have certified its financial statements, and supply all other
information reasonably requested by each of them, as shall be
necessary or appropriate, in the opinion of the Forstmann Little
Companies' and such underwriters' respective counsel, to conduct a
reasonable investigation within the meaning of the Securities Act.
2.6 Indemnification.
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(a) Indemnification by Parent and the Company.
Parent and the Company agree, jointly and severally, that in the event
of any registration of any securities of Parent under the Securities
Act, each of Parent and the Company will, and hereby does, indemnify
and hold harmless each Forstmann Little Company, its respective
directors, officers, partners, agents and affiliates and each other
Person who participates as an underwriter in the offering or sale of
such securities and each other Person, if any, who controls such
Forstmann Little Company or any such underwriter within the meaning of
the Securities Act, against any losses, claims, damages, or
liabilities, joint or several, to which such Forstmann Little Company
or any such director, officer, partner, agent or affiliate or
underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities, joint or several (or actions or proceedings, whether
commenced or threatened, in respect thereof), arise out of or are
based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein,
or any amendment or supplement thereto, (ii) any omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein in light of the
circumstances in which they were made not misleading, or (iii) any
violation by Parent of any federal, state or common law rule or
regulation applicable to Parent and relating to action required of or
inaction by Parent in connection with any such registration, and each
of Parent and the Company will reimburse such Forstmann Little Company
and each such director, officer, partner, agent or affiliate,
underwriter and controlling Person for any legal or any other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, liability, action or proceeding;
provided that Parent and the Company shall not be liable in any such
case to the extent that any such loss, claim, damage, liability (or
action or proceeding in respect thereof) or expense arises out of or
is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in such registration statement, any
such preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement in reliance upon and in conformity with
written information furnished to Parent through an instrument duly
executed by or on behalf of the Forstmann Little Companies or
underwriter, as the case may be, specifically stating that it is for
use in the preparation thereof; and provided, further, that Parent
shall not be liable to any Person who participates as an underwriter
in the offering or sale of Registrable Securities or any other Person,
if any, who controls such underwriter within the meaning of the
Securities Act, in any such case to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof)
or expense arises out of such Person's failure to send or give a copy
of the final prospectus, as the same may be then supplemented or
amended, to the Person asserting an untrue statement or alleged untrue
statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such Person if
such statement or omission was corrected in such final prospectus.
Such indemnity shall remain in full force regardless of any
investigation made by or on behalf of either Forstmann Little Company
or any such director, officer, partner, agent or affiliate or
controlling Person and shall survive the transfer of such securities
by such Forstmann Little company.
(b) Indemnification by the Forstmann Little
Companies. As a condition to including any Registrable Securities in
any registration statement, Parent shall have received an undertaking
reasonably satisfactory to it from each Forstmann Little Company so
including any Registrable Securities to indemnify and hold harmless
(in the same manner and to the same extent as set forth in paragraph
(a) of this Section 2.6) Parent, and each director of Parent, each
officer of Parent and each other Person, if any, who controls Parent
within the meaning of the Securities Act, with respect to any
statement or alleged statement in or omission or alleged omission from
such registration statement, any preliminary prospectus, final
prospectus or summary prospectus contained therein, or any amendment
or supplement thereto, but only to the extent such statement or
alleged statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to Parent
through an instrument duly executed by such Forstmann Little Company
specifically stating that it is for use in the preparation of such
registration statement, preliminary prospectus, final prospectus,
summary prospectus, amendment or supplement; provided, however, that
the liability of such indemnifying party under this Section 2.6(b)
shall be limited to the amount of net proceeds received by such
indemnifying party in the offering giving rise to such liability. Such
indemnity shall remain in full force and effect, regardless of any
investigation made by or on behalf of Parent or any such director,
officer or controlling person and shall survive the transfer of such
securities by such Forstmann Little Company.
(c) Notices of Claims, etc. Promptly after receipt
by an indemnified party of notice of the commencement of any action or
proceeding involving a claim referred to in the preceding subsections
of this Section 2.6, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action or
proceeding; provided, however, that the failure of any indemnified
party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subsections
of this Section 2.6, except to the extent that the indemnifying party
is actually prejudiced by such failure to give notice, and shall not
relieve the indemnifying party from any liability which it may have to
the indemnified party otherwise than under this Section 2.6. In case
any such action or proceeding is brought against an indemnified party,
the indemnifying party shall be entitled to participate therein and,
unless in the opinion of outside counsel to the indemnified party a
conflict of interest between such indemnified and indemnifying parties
may exist in respect of such claim, to assume the defense thereof,
jointly with any other indemnifying party similarly notified to the
extent that it may wish, with counsel reasonably satisfactory to such
indemnified party; provided, however, that if the defendants in any
such action or proceeding include both the indemnified party and the
indemnifying party and if in the opinion of outside counsel to the
indemnified party there may be legal defenses available to such
indemnified party and/or other indemnified parties which are different
from or in addition to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate
counsel to defend such action or proceeding on behalf of such
indemnified party or parties, provided, however, that the indemnifying
party shall be obligated to pay for only one counsel for all
indemnified parties. After notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof and
approval by the indemnified party of such counsel, the indemnifying
party shall not be liable to such indemnified party for any legal
expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation (unless
the first proviso in the preceding sentence shall be applicable). No
indemnifying party shall be liable for any settlement of any action or
proceeding effected without its written consent. No indemnifying party
shall, without the consent of the indemnified party, consent to entry
of any judgment or enter into any settlement which does not include as
an unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in respect
to such claim or litigation.
(d) Contribution. If the indemnification provided
for in this Section 2.6 shall for any reason be held by a court to be
unavailable to an indemnified party under subsection (a) or (b) hereof
in respect of any loss, claim, damage or liability, or any action in
respect thereof, then, in lieu of the amount paid or payable under
subsection (a) or (b) hereof, the indemnified party and the
indemnifying party under subsection (a) or (b) hereof shall contribute
to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with
investigating the same), (i) in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand,
and the indemnified party on the other, which resulted in such loss,
claim, damage or liability, or action in respect thereof, with respect
to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations, or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law or if
the allocation provided in this clause (ii) provides a greater amount
to the indemnified party than clause (i) above, in such proportion as
shall be appropriate to reflect not only the relative fault but also
the relative benefits received by the indemnifying party and the
indemnified party from the offering of the securities covered by such
registration statement as well as any other relevant equitable
considerations. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 2.6(d) were to be
determined by pro rata allocation or by any other method of allocation
which does not take into account the equitable considerations referred
to in the preceding sentence of this Section 2.6(d). No Person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation. The
Forstmann Little Companies" obligations to contribute as provided in
this subsection (d) are several and not joint and shall be in
proportion to the relative value of their respective Registrable
Securities covered by such registration statement. In addition, no
Person shall be obligated to contribute hereunder any amounts in
payment for any settlement of any action or claim effected without
such Person's consent, which consent shall not be unreasonably
withheld. Notwithstanding anything in this subsection (d) to the
contrary, no indemnifying party (other than Parent and the Company)
shall be required to contribute any amount in excess of the net
proceeds received by such party from the sale of the Registrable
Securities in the offering to which the losses, claims, damages or
liabilities of the indemnified parties relate.
(e) Other Indemnification. Indemnification and
contribution similar to that specified in the preceding subsections of
this Section 2.6 (with appropriate modifications) shall be given by
Parent, the Company and the Forstmann Little Companies with respect to
any required registration or other qualification of securities under
any federal, state or blue sky law or regulation of any governmental
authority other than the Securities Act. The indemnification
agreements contained in this Section 2.6 shall be in addition to any
other rights to indemnification or contribution which any indemnified
party may have pursuant to law or contract and shall remain operative
and in full force and effect regardless of any investigation made by
or on behalf of any indemnified party and shall survive the transfer
of any of the Registrable Securities by any of the Forstmann Little
Companies.
(f) Indemnification Payments. The indemnification
and contribution required by this Section 2.6 shall be made by
periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or expense,
loss, damage or liability is incurred.
2.7 Unlegended Certificates. In connection with the
offering of any Registrable Securities registered pursuant to this
Section 2, Parent shall (i) facilitate the timely preparation and
delivery to the Forstmann Little Companies, the Management Investors
and the underwriters, if any, participating in such offering, of
unlegended certificates representing ownership of such Registrable
Securities being sold in such denominations and registered in such
names as requested by the Forstmann Little Companies, the Management
Investors or such underwriters and (ii) instruct any transfer agent
and registrar of such Registrable Securities to release any stop
transfer orders with respect to any such Registrable Securities.
2.8 Limitation on Sale of Securities. Parent hereby
agrees that if it shall previously have received a request for
registration pursuant to Section 2.1 or 2.2 hereof, and if such
previous registration shall not have been withdrawn or abandoned, (i)
Parent shall not effect any public or private offer, sale or
distribution of its securities or effect any registration of any of
its equity securities under the Securities Act (other than a
registration on Form S-8 or any successor or similar form which is
then in effect), whether or not for sale for its own account, until a
period of 90 days (or such shorter period as the Forstmann Little
Companies shall be advised by their managing underwriter) shall have
elapsed from the effective date of such previous registration, and
Parent shall so provide in any registration rights agreements
hereafter entered into with respect to any of its securities; and (ii)
Parent shall use its best efforts to cause each holder of its equity
securities purchased from Parent at any time after the date of this
Agreement to agree not to effect any public sale or distribution of
any such securities during such period, including a sale pursuant to
Rule 144 under the Securities Act.
2.9 No required Sale. Nothing in this Agreement shall
be deemed to create an independent obligation on the part of any of
the Forstmann Little Companies to sell any Registrable Securities
pursuant to any effective registration statement.
3. Rule 144. Parent shall take all actions reasonably
necessary to enable holders of Registrable Securities to sell such
securities without registration under the Securities Act within the
limitation of the exemptions provided by (a) Rule 144, or (b) any
similar rule or regulation hereafter adopted by the Commission
including, without limiting the generality of the foregoing, filing on
a timely basis all reports required to be filed by the Exchange Act.
Upon the request of either Forstmann Little Company, Parent will
deliver to such holder a written statement as to whether it has
complied with such requirements.
4. Amendments and Waivers. This Agreement may be
amended, modified or supplemented only by written agreement of the
party against whom enforcement of such amendment, modification or
supplement is sought.
5. Management Investors. The parties hereto acknowledge
and agree that no Management Investor has any right to request
registration of the Common Stock held by such Management Investor or
to participate in any registration of securities by Parent, other than
in accordance with the terms of the subscription agreement, option
agreement or stockholder's agreement, as the case may be, between such
Management Investor and Parent, pursuant to which such Management
Investor generally has the right to participate proportionately in any
public offering of all or a portion of the shares of Common Stock
owned by the Forstmann Little Companies.
6. Adjustments. In the event of any change in the
capitalization of Parent as a result of any stock split, stock
dividend, reverse split, combination, recapitalization, merger,
consolidation, or otherwise, the provisions of this Agreement shall be
appropriately adjusted. Parent agrees that it shall not effect or
permit to occur any combination or subdivision of shares which would
adversely affect the ability of the Forstmann Little Companies or the
Management Investors to include any Registrable Securities in any
registration contemplated by this Agreement or the marketability of
such Registrable Securities in any such registration. Parent agrees
that it will take all reasonable steps necessary to effect a
combination or subdivision of shares if in the reasonable judgment of
the Forstmann Little Companies such combination or subdivision would
enhance the marketability of the Registrable Securities.
7. Notice. All notices and other communications
hereunder shall be in writing and, unless otherwise provided herein,
shall be deemed to have been given when received by the party to whom
such notice is to be given at its address set forth below, or such
other address for the party as shall be specified by notice given
pursuant hereto:
(a) If to MBO-IV or Instrument Partners, to it:
c/o Forstmann Little & Co.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxx
With a copy to:
Fried, Frank, Harris, Xxxxxxx
& Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
(b) If to General Instrument Corporation, to:
General Instrument Corporation
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
8. Assignment. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and
their respective successors and permitted assigns. This Agreement may
not be assigned by Parent. Either Forstmann Little Company may, at its
election, at any time or from time to time, assign its rights under
this Agreement, in whole or in part, to any purchaser of shares of
Common Stock held by it.
9. Remedies. The parties hereto agree that money
damages or other remedy at law would not be sufficient or adequate
remedy for any breach or violation of, or a default under, this
Agreement by them and that, in addition to all other remedies
available to them, each of them shall be entitled to an injunction
restraining such breach, violation or default or threatened breach,
violation or default and to any other equitable relief, including
without limitation specific performance, without bond or other
security being required. In any action or proceeding brought to
enforce any provision of this Agreement (including the indemnification
provisions thereof), the successful party shall be entitled to recover
reasonable attorneys' fees in addition to its costs and expenses and
any other available remedy.
10. No Inconsistent Agreements. Parent will not, on or
after the date of this Agreement, enter into any agreement with
respect to its securities which is inconsistent with the rights
granted to the Forstmann Little Companies in this Agreement or
otherwise conflicts with the provisions hereof, other than any lock-up
agreement with the underwriters in connection with the offering or any
offering effected hereunder, pursuant to which Parent shall agree not
to register for sale, and Parent shall agree not to sell or otherwise
dispose of, Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock, for a specified period
following the Offering. Parent has not previously entered into any
agreement with respect to its securities granting any registration
rights to any Person other than the registration rights granted
pursuant to this Agreement and pursuant to the subscription
agreements, stock option agreements and stockholder's agreement
between Parent and the Management Investors. The rights granted to the
Forstmann Little Companies hereunder do not in any way conflict with
and are not inconsistent with any other agreements to which Parent is
a party or by which it is bound. Parent further agrees that if any
other registration rights agreement entered into after the date of
this Agreement with respect to any of its securities contains terms
which are more favorable to, or less restrictive on, the other party
thereto than the terms and conditions contained in this Agreement are
(insofar as they are applicable) to the Forstmann Little Companies,
then the terms and conditions of this Agreement shall immediately be
deemed to have been amended without further action by Parent or the
Forstmann Little Companies so that the Forstmann Little Companies
shall be entitled to the benefit of any such more favorable or less
restrictive terms or conditions.
11. Descriptive Headings. The descriptive headings of
the several sections and paragraphs of this Agreement are inserted for
reference only and shall not control or otherwise affect the meaning
hereof.
12. Governing Law. This Agreement shall be construed
and enforced in accordance with, and the rights and obligations of the
parties hereto shall be governed by, the laws of the State of New
York, without giving effect to the conflicts of law principles
thereof. Each of the parties hereto hereby irrevocably and
unconditionally consents to submit to the exclusive jurisdiction of
the courts of the State of New York and the United States of America
located in the County of New York for any action or proceeding arising
out of or relating to this Agreement and the transactions contemplated
hereby (and agrees not to commence any action or proceeding relating
thereto except in such courts), and further agrees that service of any
process, summons, notice or document by U.S. registered mail to its
respective address set forth in Section 7 hereof shall be effective
service of process for any action or proceeding brought against it in
any such court. Each of the parties hereto hereby irrevocably and
unconditionally waives any objection to the laying of venue of any
action or proceeding arising out of this Agreement or the transactions
contemplated hereby in the courts of the State of New York or the
United States of America located in the County of New York, and hereby
further irrevocably and unconditionally waives and agrees not to plead
or claim in any such court that any such action or proceeding brought
in any such court has been brought in an inconvenient forum.
13. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but
all such counterparts shall together constitute one and the same
instrument.
14. Invalidity of Provision. The invalidity or
unenforceability of any provision of this Agreement in any
jurisdiction shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of this Agreement, including that provision, in any
other jurisdiction. If any restriction or provision of this Agreement
is held unreasonable, unlawful or unenforceable in any respect, such
restriction or provision shall be interpreted, revised or applied in a
manner that renders it lawful and enforceable to the fullest extent
possible under law.
15. Further Assurances. Each party hereto shall do and
perform or cause to be done and performed all further acts and things
and shall execute and deliver all other agreements, certificates,
instruments, and documents as any other party hereto reasonably may
request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions
contemplated hereby.
16. Entire Agreement. This Agreement constitutes the
entire agreement, and supersedes all prior agreements and
understandings, oral and written, between the parties hereto with
respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed and delivered by their respective officers
thereunto duly authorized as of the date first above written.
GENERAL INSTRUMENT CORPORATION
By:
----------------------------
Title:
GI CORPORATION
By:
----------------------------
Title:
INSTRUMENT PARTNERS
By: FLC XXII Partnership,
its General Partner
By:
----------------------------
A General Partner
FORSTMANN LITTLE & CO.
SUBORDINATED DEBT AND EQUITY
MANAGEMENT BUYOUT PARTNERSHIP-IV
By: FLC Partnership, its General Partner
By:
----------------------------
A General Partner
