Exhibit 9
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement"), dated as of May
16, 2001, is entered into by and between MOTOROLA, INC., a Delaware
corporation ("Motorola"), and NEXT LEVEL COMMUNICATIONS, INC., a Delaware
corporation ("Next Level").
WHEREAS, in connection with the Credit Agreement dated as of May 16,
2001, by and between Next Level and Motorola (the "Credit Agreement"), Next
Level has granted to Motorola warrants to purchase Seven Million Five Hundred
Thousand (7,500,000) shares of Common Stock, par value $0.01 per share, of
Next Level (the "Common Stock") subject to the terms and conditions set
forth therein (as such term is further defined below, the "Warrants");
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Motorola and Next Level, for
themselves, their successors, and assigns, hereby agree as follows:
Article I
DEFINITIONS
1.1 Definitions. As used in this Agreement, the following terms will
have the following meanings, applicable both to the singular and the plural
forms of the terms described:
"Agreement" has the meaning ascribed thereto in the preamble
hereto, as such agreement may be amended and supplemented from time to time
in accordance with its terms.
"Common Stock" means the Common Stock of Next Level or any other
class of Next Level stock for which the Warrants become exercisable or
convertible.
"Holder" means the holder of any Registrable Security or of a
Warrant.
"Next Level Entities" means Next Level and any subsidiaries of Next
Level.
"Person" means any individual, partnership, limited liability
company, joint venture, corporation, trust, unincorporated organization,
government (and any department or agency thereof) or other entity.
"Registrable Securities" shall mean, collectively, any shares or
other securities issued or issuable upon exercise of the Warrants or in
exchange for or in respect of any such securities. As to any particular
Registrable Securities, such Registrable Securities shall cease to be
Registrable Securities when (i) a registration statement with respect to the
sale by the Holder thereof shall have been declared effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, (ii) they shall have been distributed to
the public in accordance with Rule 144, (iii) they shall have been otherwise
transferred, new certificates for them not bearing a legend restricting
further transfer shall have been delivered by Next Level and subsequent
disposition of them shall not require registration or qualification of them
under the Securities Act or any state securities or blue sky law then in
effect or (iv) they shall have ceased to be outstanding.
"Registration Expenses" means any and all expenses incident to
performance of or compliance with any registration of securities pursuant to
this Agreement, including, without limitation, (i) the fees, disbursements
and expenses of Next Level's counsel and accountants and the reasonable fees
and expenses of counsel selected by the Holders in accordance with this
Agreement in connection with the registration of the securities to be
disposed of; (ii) all expenses, including filing fees, in connection with the
preparation, printing and filing of the registration statement, any
preliminary prospectus or final prospectus, any other offering document and
amendments and supplements thereto and the mailing and delivering of copies
thereof to any underwriters and dealers; (iii) the cost of printing or
producing any underwriting agreements and blue sky or legal investment
memoranda and any other documents in connection with the offering, sale or
delivery of the securities to be disposed of; (iv) all expenses in connection
with the qualification of the securities to be disposed of for offering and
sale under state securities laws, including the fees and disbursements of
counsel for the underwriters or the Holders of securities in connection with
such qualification and in connection with any blue sky and legal investment
surveys; (v) the filing fees incident to securing any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of
the securities to be disposed of; (vi) transfer agents' and registrars', fees
and expenses and the fees and expenses of any other agent or trustee
appointed in connection with such offering; (vii) all security engraving and
security printing expenses; (viii) all fees and expenses payable in
connection with the listing of the securities on any securities exchange or
automated interdealer quotation system or the rating of such securities; (ix)
any other fees and disbursements of underwriters customarily paid by the
sellers of securities, but excluding underwriting discounts and commissions
and transfer taxes, if any, and (x) other reasonable out-of-pocket expenses
of Holders other than legal fees and expenses referred to in clause(s) (i)
and/or (iv) above.
"Rule 144" means Rule 144 (or any successor rule to similar effect)
promulgated under the Securities Act.
"Rule 415 Offering" means an offering on a delayed or continuous
basis pursuant to Rule 415 (or any successor rule to similar effect)
promulgated under the Securities Act.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, or
any successor statute.
"Warrant" means any of those certain warrants granted by Next Level
to Motorola pursuant to the Credit Agreement and any warrants issued in
substitution for, or replacement or, such warrants.
1.2 Internal References. Unless the context indicates otherwise,
references to Articles, Sections and paragraphs shall refer to the
corresponding articles, sections and paragraphs in this Agreement and
references to the parties shall mean the parties to this Agreement.
Article II
REGISTRATION RIGHTS
2.1 Demand Registration - Registrable Securities.
(a) Upon written notice provided at any time from a majority in
interest of the Holders, requesting that Next Level effect the registration
under the Securities Act of any or all of the Registrable Securities held by
such Holders, which notices shall specify the intended method or methods of
disposition of such Registrable Securities, Next Level shall use its best
efforts to effect the registration under the Securities Act and applicable
state securities laws of such Registrable Securities for disposition in
accordance with the intended method or methods of disposition stated in such
request (including in a Rule 415 Offering, if Next Level is then eligible to
register such Registrable Securities on Form S-3 (or a successor form) for
such offering); provided that,
(i) with respect to any registration statement filed, or to
be filed, pursuant to this Section 0, if Next Level shall furnish to the
Holders that have made such request a certified resolution of the Board of
Directors of Next Level stating that in the Board of Directors' good faith
judgment it would (because of the existence of, or in anticipation of, any
acquisition or financing activity, or the unavailability for reasons beyond
Next Level's reasonable control of any required financial statements, or any
other event or condition of similar significance to Next Level) be seriously
disadvantageous (a "Disadvantageous Condition") to Next Level for such a
registration statement to be maintained effective, or to be filed and become
effective, and setting forth the general reasons for such judgment, Next
Level shall be entitled to cause such registration statement to be withdrawn
and the effectiveness of such registration statement terminated, or, in the
event no registration statement has yet been filed, shall be entitled not to
file any such registration statement, until such Disadvantageous Condition no
longer exists (notice of which Next Level shall promptly deliver to such
Holders). Upon receipt of any such notice of a Disadvantageous Condition,
such Holders shall forthwith discontinue use of the prospectus contained in
such registration statement and, if so directed by Next Level, each such
Holder will deliver to Next Level all copies, other than permanent file
copies then in such Holder's possession, of the prospectus then covering such
Registrable Securities current at the time of receipt of such notice;
provided, that the filing of any such registration statement may not be
delayed for a period in excess of 60 days in any calendar year due to the
occurrence of one or more Disadvantageous Conditions;
(ii) the Holders may collectively exercise their rights under
this Section 0 on not more than four (4) occasions;
(iii) except as otherwise provided in Section 0 or elsewhere
in this Agreement, the Holders shall not have the right to exercise
registration rights pursuant to this Section 0 within the 180-day period
following the date hereof or following the registration and sale of
Registrable Securities effected pursuant to a prior exercise of the
registration rights provided in this Section 0.
(b) Notwithstanding any other provision of this Agreement to the
contrary, a registration requested by a Holder pursuant to this Section 0
shall not be deemed to have been effected (and, therefore, not requested for
purposes of paragraph 0 above), (i) if it shall not have become effective,
(ii) if after it has become effective such registration is interfered with by
any stop order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason other than a misrepresentation or
an omission by a Holder or ceases to be maintained effective due to a
Disadvantageous Condition and, as a result thereof, the Registrable
Securities requested to be registered cannot be completely distributed in
accordance with the plan of distribution set forth in the related
registration statement or (iii) if the conditions to closing specified in the
purchase agreement or underwriting agreement entered into in connection with
such registration are not satisfied or waived other than by reason of some
act or omission by a Holder within its control.
(c) In the event that any registration pursuant to this Section 0
shall involve, in whole or in part, an underwritten offering, the Holders of
a majority of the Registrable Securities to be registered pursuant to this
Section 0 shall have the right to designate an underwriter or underwriters
reasonably acceptable to Next Level as the lead or managing underwriters of
such underwritten offering and, in connection with each registration pursuant
to this Section 0, such Holders may select one counsel reasonably acceptable
to Next Level to represent all such Holders.
(d) Next Level shall have the right to cause the registration of
additional equity securities for sale for its account or any existing or
former directors, officers or employees of the Next Level Entities in any
registration of Registrable Securities requested for the benefit of the
Holders pursuant to paragraph 0 above; provided, however, that, if such
Holders are advised in writing (with a copy to Next Level) by a nationally
recognized investment banking firm selected by such Holders reasonably
acceptable to Next Level (which shall be the lead underwriter or a managing
underwriter in the case of an underwritten offering) that, in such firm's
good faith view, the inclusion of such additional equity securities in such
registration would be likely to have an adverse effect on the price, timing
or distribution of the offering and sale of the Registrable Securities then
contemplated by such Holders, the registration of such additional equity
securities or part thereof shall not be permitted. The Holders of the
Registrable Securities to be registered pursuant to this Section 0 may
require that any such additional equity securities be included in the
offering proposed by such Holders on the same conditions as the Registrable
Securities that are included therein. In the event that the number of
Registrable Securities requested to be included in such registration by such
Holders exceeds the number which, in the good faith view (delivered in
writing) of such investment banking firm, can be sold without adversely
affecting the price, timing, distribution or sale of securities in the
offering, the number shall be allocated pro rata among the requesting Holders
on the basis of the relative number of Registrable Securities then held by
each such Holder (including Registrable Securities such Holder may acquire on
exercise of such Holder's Warrant(s)), provided that any number in excess of
a Holder's request may be reallocated among the remaining requesting Holders
in a like manner.
2.2 Piggyback Registration. In the event that Next Level at any time
after the date hereof proposes to register any Common Stock or any securities
convertible into or exchangeable for Common Stock under the Securities Act,
whether or not for sale for its own account and including pursuant to Section
0 (such stock or securities, "Other Securities"), in a manner that would
permit registration of Registrable Securities for sale for cash to the public
under the Securities Act, it shall at each such time give prompt written
notice to each of the Holders of its intention to do so and of the rights of
such Holders under this Section 0. Subject to the terms and conditions
hereof, such notice shall offer each such Holder the opportunity to include
in such registration statement such number of the Registrable Securities of
such Holder as such Holder may request. Upon the written request of any such
Holder made within 15 days after the receipt of Next Level's notice (which
request shall specify the number of Registrable Securities intended to be
disposed of and the intended method of disposition thereof), Next Level shall
use its best efforts to effect, in connection with the registration of the
Other Securities, the registration under the Securities Act of all
Registrable Securities which Next Level has been so requested to register, to
the extent required to permit the disposition (in accordance with such
intended method of disposition thereof) of the Registrable Securities so
requested to be registered; provided, that:
(a) if, at any time after giving such written notice of its
intention to register any Other Securities and prior to the effective date of
the registration statement filed in connection with such registration, Next
Level shall determine for any reason not to register the Other Securities,
Next Level may, at its election, give written notice of such determination to
such Holders and thereupon Next Level shall be relieved of its obligation to
register such Registrable Securities in connection with the registration of
such Other Securities, without prejudice, however, to the rights of the
Holders immediately to request that such registration be effected as a
registration under Section 0 to the extent permitted thereunder;
(b) if a nationally recognized investment banking firm selected by
Next Level advises Next Level in writing that, in such firm's good faith
view, all or a part of such Registrable Securities cannot be sold and the
inclusion of all or a part of such Registrable Securities in such
registration would be likely to have an adverse effect upon the price, timing
or distribution of the offering and sale of the Other Securities then
contemplated, Next Level shall include in such registration: (i) first, the
Other Securities being sold for its own account or the Other Securities which
are Registrable Securities included pursuant to Section 0 and/or any Other
Securities being registered pursuant to any demand registration rights held
by Persons other than Next Level and the Holders and (ii) second, up to the
full number of Registrable Securities requested to be included pursuant to
this Section 0 and the remaining Other Securities that are requested to be
included in such registration in excess of the number of securities referred
to in clause (i) which, in the good faith view of such investment banking
firm, can be sold without adversely affecting such offering, such full number
to be allocated pro rata among the holders of the securities referred to in
this clause (ii) based on the relative number of securities requested to be
included by each such holder (provided further that, in the event that such
investment banking firm advises in writing that less than all of such
Registrable Securities may be included in such offering, one or more of such
Holders may withdraw their request for registration of their Registrable
Securities under this Section 0 and ninety (90) days subsequent to the
effective date of the registration statement for the registration of such
Other Securities request that such registration be effected as a registration
under Section 0 to the extent permitted thereunder);
(c) Next Level shall not be required to effect any registration of
Registrable Securities under this Section 0 incidental to the registration of
any of its securities in connection with mergers, acquisitions, exchange
offers, subscription offers, dividend reinvestment plans or stock option or
other executive or employee benefit or compensation plans; and
(d) no registration of Registrable Securities effected under this
Section 0 shall relieve Next Level of its obligation to effect a registration
of Registrable Securities pursuant to Section 0.
2.3 Expenses. Next Level shall pay all Registration Expenses with
respect to a particular offering (or proposed offering). Notwithstanding the
foregoing, each of the Holders and Next Level shall be responsible for its
own internal administrative and similar costs, which shall not constitute
Registration Expenses.
2.4 Registration and Qualification. If and whenever Next Level is
required to effect the registration of any Registrable Securities under the
Securities Act as provided in Sections 0 or 0, Next Level shall as promptly
as practicable:
(a) prepare, file and use its best efforts to cause to become
effective a registration statement under the Securities Act relating to the
Registrable Securities to be offered;
(b) prepare and file with the SEC 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 until the earlier of (A) such time
as all of such Registrable Securities have been disposed of in accordance
with the intended methods of disposition set forth in such registration
statement and (B) the expiration of three months after such registration
statement becomes effective; provided, that such three-month period shall be
extended for such number of days that equals the number of days elapsing from
(x) the date the written notice contemplated by paragraph 0 below is given by
Next Level to (y) the date on which Next Level delivers to the Holders of
Registrable Securities the supplement or amendment contemplated by paragraph
0 below;
(c) furnish to the Holders of Registrable Securities and to any
underwriter of such Registrable Securities 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 included in such registration statement (including each
preliminary prospectus and any summary prospectus), in conformity with the
requirements of the Securities Act, such documents incorporated by reference
in such registration statement or prospectus, and such other documents, as
the Holders of Registrable Securities or such underwriter may reasonably
request, and upon request a copy of any and all transmittal letters or other
correspondence to or received from, the SEC or any other governmental agency
or self-regulatory body or other body having jurisdiction (including any
domestic or foreign securities exchange) relating to such offering;
(d) use its best efforts to register or qualify all Registrable
Securities covered by such registration statement under the securities or
blue sky laws of such U.S. jurisdictions as the Holders of such Registrable
Securities or any underwriter to such Registrable Securities shall reasonably
request, and use its reasonable best efforts to obtain all appropriate
registrations, permits and consents in connection therewith, and do any and
all other acts and things which may be necessary or advisable to enable the
Holders of Registrable Securities or any such underwriter to consummate the
disposition in such jurisdictions of its Registrable Securities covered by
such registration statement; provided, that Next Level shall not for any such
purpose be required to qualify generally to do business as a foreign
corporation in any such jurisdiction wherein it is not so qualified or to
consent to general service of process in any such jurisdiction;
(e) use its best efforts (i) to furnish to each of the Holders of
Registrable Securities included in such registration (each, a "Selling
Holder") and to any underwriter of such Registrable Securities an opinion of
counsel for Next Level addressed to each Selling Holder and dated the date of
the closing under the underwriting agreement (if any) (or if such offering is
not underwritten, dated the effective date of the registration statement) and
(ii) to furnish to each Selling Holder a "cold comfort" letter addressed to
each Selling Holder and signed by the independent public accountants who have
audited the financial statements of Next Level included in such registration
statement, in each such case covering substantially the same matters with
respect to such registration statement (and the prospectus included therein)
as are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to underwriters in underwritten public
offerings of securities and such other matters as the Selling Holders may
reasonably request and, in the case of such accountants' letter, with respect
to events subsequent to the date of such financial statements;
(f) as promptly as practicable, notify the Selling Holders in
writing (i) at any time when a prospectus relating to a registration pursuant
to Sections 0 or 0 is required to be delivered under the Securities Act of
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, in light of the
circumstances under which they were made, not misleading and (ii) of any
request by the SEC or any other regulatory body or other body having
jurisdiction for any amendment of or supplement to any registration statement
or other document relating to such offering, and in either such case, at the
request of the Selling Holders prepare and furnish to the Selling Holders 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 Registrable 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, in
light of the circumstances under which they are made, not misleading;
(g) if requested by the lead or managing underwriters, use its
best efforts to list all such Registrable Securities covered by such
registration on each securities exchange and automated inter-dealer quotation
system on which common equity securities of Next Level are then listed;
(h) to the extent reasonably requested by the lead or managing
underwriters, send appropriate officers of Next Level to attend and
participate in any "road shows" scheduled in connection with any such
registration, with all out-of-pocket costs and expense incurred by Next Level
or such officers in connection with such attendance to be paid by Next Level;
and
(i) furnish for delivery in connection with the closing of any
offering of Registrable Securities pursuant to a registration effected
pursuant to Sections 0 or 0 unlegended certificates representing ownership of
the Registrable Securities being sold in such denominations as shall be
requested by the Selling Holders or the underwriters.
2.5 Underwriting; Due Diligence.
(a) If requested by the underwriters for any underwritten offering
of Registrable Securities pursuant to a registration requested under this
Agreement, Next Level shall enter into an underwriting agreement with such
underwriters for such offering, which agreement will contain such
representations and warranties by Next Level and such other terms and
provisions as are customarily contained in underwriting agreements of Next
Level to the extent relevant and as are customarily contained in underwriting
agreements generally with respect to secondary distributions to the extent
relevant, including, without limitation, indemnification and contribution
provisions substantially to the effect and to the extent provided in Section
0, and agreements as to the provision of opinions of counsel and accountants'
letters to the effect and to the extent provided in Section 0. The Selling
Holders on whose behalf the Registrable Securities are to be distributed by
such underwriters shall be parties to any such underwriting agreement and the
representations and warranties by, and the other agreements on the part of,
Next Level to and for the benefit of such underwriters, shall also be made to
and for the benefit of such Selling Holders. Such underwriting agreement
shall also contain such representations and warranties by such Selling
Holders and such other terms and provisions as are customarily contained in
underwriting agreements with respect to secondary distributions, when
relevant, including, without limitation, indemnification and contribution
provisions substantially to the effect and to the extent provided in Section
0.
(b) In connection with the preparation and filing of each
registration statement registering Registrable Securities under the
Securities Act pursuant to this Agreement, Next Level shall give the Holders
of such Registrable Securities and the underwriters, if any, and their
respective counsel and accountants, such reasonable and customary access to
its books and records and such opportunities to discuss the business of Next
Level with its officers and the independent public accountants who have
certified the financial statements of Next Level as shall be necessary, in
the opinion of such Holders and such underwriters or their respective
counsel, to conduct a reasonable investigation within the meaning of the
Securities Act.
2.6 Indemnification and Contribution.
(a) In the case of each offering of Registrable Securities made
pursuant to this Agreement, Next Level agrees to indemnify and hold harmless,
to the extent permitted by law, each of the Selling Holders, each underwriter
of Registrable Securities so offered and each Person, if any, who controls
any of the foregoing Persons within the meaning of the Securities Act and the
officers, directors, affiliates, employees and agents of each of the
foregoing, against any and all losses, liabilities, costs (including
reasonable attorney's fees and disbursements and reasonable costs of
investigation and preparation), claims and damages, joint or several, to
which they or any of them may become subject, under the Securities Act or
otherwise, including any amount paid in settlement of any litigation
commenced or threatened, insofar as such losses, liabilities, costs, claims
and damages (or actions or proceedings in respect thereof, whether or not
such indemnified Person is a party thereto) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
in the registration statement (or in any preliminary or final prospectus
included therein) or in any offering memorandum or other offering document
relating to the offering and sale of such Registrable Securities, or any
amendment thereof or supplement thereto, or in any document incorporated by
reference therein, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however that Next Level shall
not be liable to any Person in any such case to the extent that any such
loss, liability, cost, claim or damage arises out of or relates to any untrue
statement or alleged untrue statement, or any omission, if such statement or
omission shall have been made in reliance upon and in conformity with
information relating to a Selling Holder, another holder of securities
included in such registration statement or underwriter furnished in writing
to Next Level by or on behalf of such Selling Holder, other holder or
underwriter specifically for use in the registration statement (or in any
preliminary or final prospectus included therein), offering memorandum or
other offering document, or any amendment thereof or supplement thereto.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of any Selling Holder, any other holder or
any underwriter and shall survive the transfer of such securities. The
foregoing indemnity agreement is in addition to any liability that Next Level
may otherwise have to each Selling Holder, other holder or underwriter of the
Registrable Securities or any controlling person of the foregoing and the
officers, directors, affiliates, employees and agents of each of the
foregoing; provided, further, that, in the case of an offering with respect
to which a Selling Holder has designated the lead or managing underwriters
(or a Selling Holder is offering Registrable Securities directly, without an
underwriter), this indemnity does not apply to any loss, liability, cost,
claim or damage arising out of or relating to any untrue statement or alleged
untrue statement or omission or alleged omission in any preliminary
prospectus or offering memorandum if a copy of a final prospectus or offering
memorandum was available on a timely basis and not sent or given by or on
behalf of any underwriter (or such Selling Holder or other holder, as the
case may be) to such Person asserting such loss, liability, cost, claim or
damage at or prior to the written confirmation of the sale of the Registrable
Securities as required by the Securities Act and such untrue statement or
omission had been corrected in such final prospectus or offering memorandum.
(b) In the case of each offering made pursuant to this Agreement,
each Selling Holder, by exercising its registration rights hereunder, agrees
to indemnify and hold harmless, and to use reasonable best efforts to cause
each underwriter of Registrable Securities included in such offering (in the
same manner and to the same extent as set forth in Section 00) to agree to
indemnify and hold harmless, Next Level, each other underwriter who
participates in such offering, each other Selling Holder or other holder with
securities included in such offering and in the case of an underwriter, such
Selling Holder or other holder, and each Person, if any, who controls any of
the foregoing within the meaning of the Securities Act and the officers,
directors, affiliates, employees and agents of each of the foregoing, against
any and all losses, liabilities, costs (including reasonable attorney's fees
and disbursements and reasonable costs of investigation and preparation),
claims and damages to which they or any of them may become subject, under the
Securities Act or otherwise, including any amount paid in settlement of any
litigation commenced or threatened, insofar as such losses, liabilities,
costs, claims and damages (or actions or proceedings in respect thereof,
whether or not such indemnified Person is a party thereto) arise out of or
are based upon any untrue statement or alleged untrue statement by such
Selling Holder or underwriter, as the case may be, of a material fact
contained in the registration statement (or in any preliminary or final
prospectus included therein) or in any offering memorandum or other offering
document relating to the offering and sale of such Registrable Securities
prepared by Next Level or at its direction, or any amendment thereof or
supplement thereto, or any omission by such Selling Holder or underwriter, as
the case may be, or alleged omission by such Selling Holder or underwriter,
as the case may be, of a material fact required to be stated therein or
necessary to make the statements therein not misleading, but in each case
only to the extent that such untrue statement of a material fact is contained
in, or such material fact is omitted from such registration statement or
prospectus in reliance on and in conformity with information relating to such
Selling Holder or underwriter, as the case may be, furnished in writing to
Next Level by or on behalf of such Selling Holder or underwriter, as the case
may be, specifically for use in such registration statement (or in any
preliminary or final prospectus included therein), offering memorandum or
other offering document, or any amendment thereof or supplement thereto. The
foregoing indemnity is in addition to any liability which such Selling Holder
or underwriter, as the case may be, may otherwise have to Next Level, or
controlling persons and the officers, directors, affiliates, employees, and
agents of each of the foregoing; provided, however, that, in the case of an
offering made pursuant to this Agreement with respect to which Next Level has
designated the lead or managing underwriters (or Next Level is offering
securities directly, without an underwriter), this indemnity does not apply
to any loss, liability, cost, claim, or damage arising out of or based upon
any untrue statement or alleged untrue statement or omission or alleged
omission in any preliminary prospectus or offering memorandum if a copy of a
final prospectus or offering memorandum was not sent or given by or on behalf
of any underwriter (or Next Level, as the case may be) to such Person
asserting such loss, liability, cost, claim or damage at or prior to the
written confirmation of the sale of the Registrable Securities as required by
the Securities Act and such untrue statement or omission had been corrected
in such final prospectus or offering memorandum.
(c) Each party indemnified under paragraph 0 or 0 above shall,
promptly after receipt of notice of a claim or action against such
indemnified party in respect of which indemnity may be sought hereunder,
notify the indemnifying party in writing of the claim or action; provided,
that the failure to notify the indemnifying party shall not relieve it from
any liability that it may have to an indemnified party on account of the
indemnity agreement contained in paragraph 0 or 0 above except to the extent
that the indemnifying party is prejudiced thereby. If any such claim or
action shall be brought against an indemnified party, and it shall have
notified the indemnifying party thereof, unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified party and
indemnifying parties may exist in respect of such claim, the indemnifying
party shall be entitled to participate therein, and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to the
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party); provided that, if an
indemnified party and an indemnifying party shall have conflicting claims or
defenses, the indemnifying party shall not have control of such conflicting
claims or defenses and the indemnified party shall be entitled to appoint
separate counsel for such claims and defenses at the cost and expense of the
indemnifying party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 0 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation. If the indemnifying party does not assume
the defense of such claim or action, it is understood that the indemnifying
party shall not, in connection with any one such claim or action or separate
but substantially similar or related claims or actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys
(in addition to one separate firm of local attorneys in each such
jurisdiction) at any time for all such indemnified parties. No indemnifying
party shall (i) without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with respect to
any pending or threatened claim, action, suit or proceeding in respect of
which indemnification or contribution may be sought hereunder (whether or not
the indemnified parties are actual or potential parties to such claim or
action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent, but if
settled with its written consent or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss of liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 0 shall
for any reason be unavailable (other than in accordance with its terms) to an
indemnified party in respect of any loss, liability, cost, claim or damage
referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable
by such indemnified party as a result of such loss, liability, cost, claim or
damage in such proportion as shall be appropriate to reflect the relative
fault of the indemnifying party on the one hand and the indemnified party on
the other with respect to the statements or omissions which resulted in such
loss, liability, cost, claim or damage as well as any other relevant
equitable considerations. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the indemnifying party on the one hand or the
indemnified party on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission, but not by reference to any indemnified party's stock
ownership in Next Level. The amount paid or payable by an indemnified party
as a result of the loss, cost, claim, damage or liability, or action in
respect thereof, referred to above in this paragraph 0 shall be deemed to
include, for purposes of this paragraph 0, any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. 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.
(e) Indemnification and contribution similar to that specified in
the preceding paragraphs of this Section 0 (with appropriate modifications)
shall be given by Next Level, the Selling Holders and underwriters with
respect to any required registration or other qualification of securities
under any state law or regulation or governmental authority.
(f) The obligations of the parties under this Section 0 shall be
in addition to any liability which any party may otherwise have to any other
party.
2.7 Rule 144 and Form S-3. Commencing 90 days after the date hereof,
Next Level shall use its best efforts to ensure that the conditions to the
availability of Rule 144 set forth in paragraph (c) thereof shall be
satisfied. Upon the request of any Holder of Registrable Securities, Next
Level will deliver to such Holder a written statement as to whether it has
complied with such requirements. Next Level further agrees to use its
reasonable efforts to cause all conditions to the availability of Form S-3
(or any successor form) under the Securities Act of the filing of
registration statements under this Agreement to be met as soon as practicable
after the date hereof.
2.8 Transfer of Registration Rights. Any Holder may transfer all or
any portion of its rights under this Agreement to any transferee of
Registrable Securities owned by such Holder. Any transfer of registration
rights pursuant to this Section 0 shall be effective upon receipt by Next
Level of (i) written notice from such Holder stating the name and address of
any transferee and identifying the number of Registrable Securities with
respect to which the rights under this Agreement are being transferred and
the nature of the rights so transferred and (ii) a written agreement from
such transferee to be bound by the terms of this Agreement. The Holders may
exercise their rights hereunder in such priority as they shall agree upon
among themselves.
2.9 Holdback Agreement. If Next Level effects any registration of
equity securities of Next Level or any securities convertible into or
exchangeable or exercisable for any equity securities of Next Level pursuant
to this Agreement or otherwise in which 20% or more of the securities
registered thereby are Registrable Securities, each Holder agrees not to
effect any public sale or distribution, including any sale under Rule 144, of
any equity security of Next Level or any security convertible into or
exchangeable or exercisable for any equity security of Next Level (otherwise
than through the registered public offering then being made) within 7 days
prior to or 90 days (or such lesser period as the lead or managing
underwriters may permit) after the effective date of the registration
statement (or the commencement of the offering to the public of such
Registrable Securities in the case of Rule 415 offerings). Next Level hereby
also so agrees; provided, that, subject to Section 0 hereof, Next Level shall
not be so restricted from effecting any public sale or distribution of any
security in connection with any merger, acquisition, exchange offer,
subscription offer, dividend reinvestment plan or stock option or other
executive or employee benefit or compensation plan.
ARTICLE III
MISCELLANEOUS
3.1 Assistance in Disposition of Shares. Regardless of whether one or
more Holders or other parties shall have requested registration of Common
Stock hereunder, but subject to any market stand-off, hold-back, or similar
provisions that may apply, one or more Holders of Registrable Securities may
at any time request that Next Level assist such Holder(s) in the sale of such
securities on favorable terms. In such an event, Next Level shall use its
commercially reasonable best efforts to assist such Holder (or such Holders,
on an equitable basis) in identifying opportunities and making arrangements
for a private placement, block trade, or other sale, transfer, or exchange of
such securities on reasonable and favorable terms consistent with all
applicable securities laws and regulations.
3.2 Limitation of Liability. No party hereto shall be liable hereunder
for any special, indirect, incidental or consequential damages of the other
arising in connection with this Agreement.
3.3 Amendments. This Agreement may not be amended or terminated
orally, but only by a writing duly executed by or on behalf of each of the
parties hereto, or their respective permitted transferees or assignees. Any
such amendment shall be validly and sufficiently authorized for purposes of
this Agreement if it is signed on behalf of the parties hereto by any of
their respective presidents or vice presidents.
3.4 Term. This Agreement shall remain in effect until no Registrable
Securities remain outstanding; provided, that the provisions of Sections 0, 0
and 0 shall survive any such expiration.
3.5 Severability. If any provision of this Agreement or the
application of any such provision to any party or circumstances shall be
determined by any court of competent jurisdiction to be invalid, illegal or
unenforceable to any extent, the remainder of this Agreement or such
provision or the application of such provision to such party or
circumstances, other than those to which it is so determined to be invalid,
illegal or unenforceable, shall remain in full force and effect to the
fullest extent permitted by law and shall not be affected thereby, unless
such a construction would be unreasonable.
3.6 Notices. All notices and other communications required or
permitted hereunder shall be in writing, shall be deemed duly given upon
actual receipt, and shall be delivered (a) in person (including by commercial
courier service), (b) by registered or certified mail, postage prepaid, or
(c) by facsimile or other generally accepted means of electronic transmission
(provided that a copy of any notice delivered pursuant to this clause (c)
shall also be sent pursuant to clause (b)), addressed as follows:
(a) if to Next Level, to:
Next Level Communications, Inc.
0000 Xxxxx Xxxx Xxxxx
Xxxxxxx Xxxx, XX 00000
Attention: Chief Financial Officer
Telecopy No.: (000) 000-0000
(b) If to Motorola, to:
Motorola, Inc.
0000 Xxxx Xxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Treasurer
Telecopy No. (000) 000-0000
or to such other addresses or telecopy numbers as may be specified by like
notice to the other parties.
3.7 Further Assurances. The parties hereto shall execute, acknowledge
and deliver, or cause to be executed, acknowledged and delivered, such
instruments and take such other action as may be necessary or advisable to
carry out their obligations under this Agreement and under any exhibit,
document or other instrument delivered pursuant hereto.
3.8 Counterparts; Execution. This Agreement may be executed and
delivered in counterparts, each of which shall be deemed an original
instrument, but all of which together shall constitute but one and the same
agreement. This Agreement may be executed and delivered by facsimile.
3.9 Governing Law; Consent to Jurisdiction. This Agreement and the
transactions contemplated hereby shall be construed in accordance with, and
governed by, the laws of the State of New York. Each of Next Level and
Motorola hereby submits to the nonexclusive jurisdiction of the United States
District Court for the Southern District of New York and of any New York
state court sitting in New York City for the purposes of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby. Each of Next Level and Motorola irrevocably waives, to
the fullest extent permitted by applicable law, any objection that each may
now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in
such a court has been brought in an inconvenient forum.
3.10 Entire Agreement. This Agreement constitutes the entire
understanding of the parties hereto with respect to the subject matter
hereof.
3.11 Transfers and Assignments. This Agreement shall be binding upon,
and shall inure to the benefit of, the parties hereto and their respective
successors and permitted assigns (including transferees). Nothing contained
in this Agreement, express or implied, is intended to confer upon any other
person or entity any benefits, rights or remedies.
3.12 Specific Performance. The parties hereto acknowledge and agree
that irreparable damage would occur in the event that any of the provisions
of this Agreement were not performed in accordance with their specific terms
or were otherwise breached. Accordingly, it is agreed that they shall be
entitled to an injunction or injunctions to prevent breaches of the
provisions of this Agreement and to enforce specifically the terms and
provisions hereof in any court of competent jurisdiction in the United States
or any state thereof, in addition to any other remedy to which they may be
entitled at law or equity.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above written.
NEXT LEVEL COMMUNICATIONS, INC.
By:
Name:
Title:
MOTOROLA, INC.
By:
Name:
Title:
