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EXHIBIT 10.2
EARNOUT SHARE AGREEMENT
between
NORTEL NETWORKS LLC
and
ANTEC CORPORATION
dated as of March 31, 1999
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EARNOUT SHARE AGREEMENT (the "Agreement"), dated as of March 31, 1999,
made by and between Nortel Networks LLC ("Nortel") and Antec Corporation
("Antec").
W I T N E S S E T H:
WHEREAS, this Agreement is being entered into as part of a series of
transactions between Nortel, Antec and Arris Interactive L.L.C. ("Arris") which
include, among other events, the execution of an Asset Sale and Contribution
Agreement between Nortel, on the one hand, and Arris, on the other, pursuant to
which Nortel contributed certain assets obtained by Nortel from Bay Network,
Inc.'s Broadband Technology Division to Arris in return for an increased
membership interest in Arris;
WHEREAS, as part of such transaction, Nortel and Antec have entered
into the Amended and Restated Limited Liability Company Agreement of Arris (the
"LLC Agreement"), pursuant to which Nortel's interest in Arris will be adjusted
upon the achievement by Arris of certain performance goals and Nortel shall
have the right to require Antec to purchase such incremental increase in
exchange for shares of Antec Common Stock as described in this Agreement; and
NOW, THEREFORE, in consideration of the mutual promises of the parties
hereto, and of good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, it is mutually agreed by and between the parties
hereto as follows:
1. CERTAIN DEFINITIONS
Capitalized terms used in this Agreement are used as defined in this
Section 1 or elsewhere in this Agreement. Terms not otherwise defined are used
herein as defined in the LLC Agreement. As used herein:
"Agreement" has the meaning specified in the first paragraph hereof.
"Antec" means Antec Corporation, a Delaware corporation.
"Arris" has the meaning specified in the recitals hereto.
"Commission" means the United States Securities and Exchange
Commission, or any other Federal agency at the time administering the
Securities Act.
"Common Stock" means the common stock, $0.01 par value per share, of
Antec.
"Earnout Revenue" is defined in the LLC Agreement.
"Effective Date" shall mean the date of this Agreement.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any similar Federal statute, and the rules and regulations of the Commission
issued under such Act, as they each may, from time to time, be in effect.
"Exercise Notice" has the meaning specified in Section 2.a below.
"LLC Agreement" has the meaning set forth in the recitals hereto.
"Nortel" has the meaning specified in the first paragraph hereof.
"Registration Statement" means a registration statement filed by Antec
with the Commission for a public offering and sale of Common Stock (other than
a registration statement on Form S-8 or Form S-4, or their successors, or any
other form for a similar limited purpose, or any registration statement
covering only securities proposed to be issued in exchange for securities or
assets of another corporation).
"Registration Expenses" means the expenses described in Section 9.E.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar Federal statute, and the rules and regulations of the Commission issued
under such Act, as they each may, from time to time, be in effect.
"Share Amount" means 2,747,252 shares of Common Stock, as adjusted
pursuant to Section 5 below.
"Shares" means the shares of Antec Common Stock purchasable by Nortel
hereunder.
2. SHARE PURCHASE
a. Upon Nortel's written election to receive shares hereunder (the
"Exercise Notice") given in accordance with Section 2.05(g) of the LLC
Agreement, Antec shall issue and sell to Nortel, and Nortel shall purchase from
Antec, the Shares in consideration of the incremental membership interest in
Arris described in Section 2.05(g) of the LLC Agreement (the "Incremental
Interest"). Each party hereto acknowledges and agrees that, at the time of such
purchase, the Incremental Interest shall have a value of not less than the
aggregate par value of the Shares.
b. The number of Shares shall be calculated as follows:
(i) If the Earnout Revenue is equal to or greater than US
$300,000,000, the number of Shares shall be the Share Amount.
(ii) If the Earnout Revenue is equal to or greater than US
$180,000,000 but lower than US $300,000,000, the number of Shares shall equal
Share Amount x (Earnout Revenue - $180,000,000)/$120,000,000
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(iii) If the Earnout Revenue is less than $180,000,000, then the
number of Shares shall be zero.
3. CLOSING.
a. The closing of the issuance of Shares under this Agreement shall
take place on the date specified by Nortel in its exercise notice, which shall
be no later than thirty (30) days following such Exercise Notice (the "Closing
Date"), at the offices of ▇▇▇▇ and ▇▇▇▇ LLP, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
or at such other time and place as the parties may agree. On the Closing Date,
Antec will deliver to Nortel a certificate or certificates in the name of
Nortel (or its designee(s)) representing the Shares in the denominations
designated by Nortel, and Nortel will purchase such Shares from Antec by
delivering to Antec an instrument of assignment for the Incremental Interest in
the form reasonably satisfactory to each of Nortel and Antec.
b. Upon the delivery by Nortel to Antec of the Exercise Notice and
the instrument of assignment for the Incremental Interest as set forth in
Section 3.a above, Nortel shall be deemed to be the holder of record of the
Shares, notwithstanding that the stock transfer books of Antec shall then be
closed or that certificates representing such Shares shall not then be actually
delivered to Nortel. Antec shall pay all expenses that may be payable in
connection with the preparation, issuance and delivery of stock certificates in
the name of Nortel.
4. TERMINATION.
This Agreement, and all rights and obligations of the parties
hereunder, shall immediately terminate and be of no further force or effect on
the earliest to occur of:
a. Nortel's failure to exercise its right under Section 2.05(g) of
the LLC Agreement to require Antec to purchase the Incremental Interest as set
forth herein;
b. A determination (made in accordance with Section 2.05(g) of the
LLC Agreement) that the Earnout Revenue is less than $180,000,000; and
c. The tenth anniversary of the issuance of the Shares.
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5. ADJUSTMENTS.
(a) Adjustment for Stock Splits and Combinations. If Antec shall at
any time or from time to time after the Effective Date effect a subdivision of
the outstanding Common Stock, the Share Amount then in effect immediately
before that subdivision shall be proportionately increased. If Antec shall at
any time or from time to time after the Effective Date combine the outstanding
shares of Common Stock, the Share Amount then in effect immediately before the
combination shall be proportionately decreased. Any adjustment under this
paragraph shall become effective at the close of business on the date the
subdivision or combination becomes effective.
(b) Adjustment for Certain Dividends and Distributions. In the event
Antec at any time, or from time to time after the Effective Date shall make or
issue, or fix a record date for the determination of holders of Common Stock
entitled to receive, a dividend or other distribution payable in additional
shares of Common Stock (or securities convertible into or exchangeable for
shares of Common Stock), then and in each such event the Share Amount then in
effect immediately before such event shall be increased as of the time of such
issuance or, in the event such a record date shall have been fixed, as of the
close of business on such record date, by multiplying the Share Amount then in
effect by the number of shares of Common Stock (or the amount of such other
securities) issuable in payment of such dividend or other distribution per each
share of Common Stock; provided, however, if such record date shall have been
fixed and such dividend is not fully paid or if such distribution is not fully
made on the date fixed therefor, the Share Amount shall be recomputed
accordingly as of the close of business on such record date and thereafter the
Share Amount shall be adjusted pursuant to this paragraph as of the time of
actual payment of such dividend or distributions.
(c) Adjustments for Changes and Distributions. The Share Amount shall
be appropriately adjusted to reflect any of the following changes in the Common
Stock for distributions to all holders of the Common Stock on a proportional
basis based on a record date between the Effective Date and the issuance of the
Shares:
(1) To the extent not adjusted therefor by operation of
Sections 5(a) and (b) hereof, any dividend of cash or property (other
than shares of Common Stock of Antec) which is not intended to be
periodically repeated for the indefinite future, or
(2) the right to buy securities or any asset for less than
fair market value.
(d) Adjustment for Merger or Reorganization, etc. If there shall
occur any reorganization, recapitalization, consolidation or merger involving
Antec in which the Common Stock is converted into or exchanged for securities,
cash or other property (other than a transaction covered by paragraphs (a), (b)
or (c) of this Section 5), then, following any such reorganization,
recapitalization, consolidation or merger, Nortel shall be entitled to receive
hereunder the kind and amount of securities, cash or other property which a
holder of the number of shares of Common Stock of Antec that would have been
issuable under this Agreement had
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such issuance occurred immediately prior to such reorganization,
recapitalization, consolidation or merger would have been entitled to receive
pursuant to such transaction; and, in such case, appropriate adjustment (as
determined in good faith by the Board of Directors) shall be made in the
application of the provisions in this Section 5 set forth with respect to the
rights and interest thereafter of Nortel, to the end that the provisions set
forth in this Section 5 shall thereafter be applicable, as nearly as reasonably
may be, in relation to any shares of stock or other property thereafter
deliverable hereunder.
(e) No Impairment. Antec will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by Antec, but will at all times in good faith
assist in the carrying out of all the provisions of this Section 5 and in the
taking of all such action as may be necessary or appropriate in order to
protect the rights of Nortel hereunder against impairment.
(f) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Share Amount pursuant to this Section 5,
Antec at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and furnish to Nortel a certificate setting
forth such adjustment or readjustment and showing in detail the facts upon
which such adjustment or readjustment is based. Antec shall, upon the written
request at any time of Nortel, furnish or cause to be furnished to Nortel a
certificate setting forth the Share Amount and the amount, if any, of other
securities, cash or property which then would be received hereunder.
(g) Notice of Record Date. In the event:
(i) Antec shall take a record of the holders of its
Common Stock (or other stock or securities at the
time issuable hereunder) for the purpose of
entitling or enabling them to receive any dividend
or other distribution, or to receive any right to
subscribe for a purchase any shares of stock of any
class or any other securities, or to receive any
other right; or
(ii) of any capital reorganization of Antec, any
reclassification of the Common Stock of Antec, any
consolidation or merger of Antec with or into
another corporation (other than a consolidation or
merger in which Antec is the surviving entity and
its Common Stock is not converted into or exchanged
for any other securities or property), or any
transfer of all or substantially all of the assets
of Antec; or
(iii) of the voluntary or involuntary dissolution, liquidation
or winding-up of Antec,
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then, and in each such case, Antec will mail or cause to be mailed to Nortel a
notice specifying, as the case may be, (i) the record date for such dividend,
distribution or right, and the amount and character of such dividend,
distribution or right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or such other stock or securities at the
time issuable hereunder) shall be entitled to exchange their shares of Common
Stock (or such other stock or securities) for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
transfer, dissolution, liquidation or winding-up. Such notice shall be mailed
at least 20 days prior to the record date or effective date for the event
specified in such notice.
6. REPRESENTATIONS AND WARRANTIES OF ANTEC.
Antec represents and warrants to Nortel that
a. Antec is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has the requisite
corporate power and authority to enter into and perform this Agreement;
b. the execution and delivery of this Agreement by Antec and the
consummation by it of the transactions contemplated by this Agreement have been
duly authorized by the Board of Directors of Antec and this Agreement has been
duly executed and delivered by a duly authorized officer of Antec and
constitutes a valid and binding obligation of Antec, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors' rights and to general equity principles;
c. the execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated by it will not, conflict with, or
result in any violation pursuant to any provisions of the certificate of
incorporation or bylaws of Antec or of any loan or credit agreement, note,
mortgage, indenture, lease, plan or other agreement, contractual obligation,
instrument, permit, concession, franchise or license applicable to Antec or its
properties or assets;
d. Antec has taken all necessary corporate action to authorize and
reserve the Shares for issuance, and the Shares, when issued and delivered by
Antec, will be duly authorized, validly issued, fully paid and non-assessable
and free of preemptive rights;
e. The execution and delivery of this Agreement by Antec and the
issuance of Shares upon exercise of this Agreement do not require the consent,
waiver, approval or authorization of or any filing with any person or public
authority and will not violate, result in a breach of or the acceleration of
any obligation under, or constitute a default under, any provision of any
charter or bylaw or any indenture, mortgage, lien, lease, agreement, contract,
instrument, order, law, rule, regulation, judgment, ordinance, or decree, or
restriction by which Antec or any of its subsidiaries or any of their
respective properties or assets is bound; and
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f. none of the restrictions of any "fair price", "moratorium",
"control share acquisition" or other form of antitakeover statute or regulation
(including, without limitation, the restrictions on "business combinations" set
forth in Section 203 of the Delaware General Corporation Law) is or shall be
applicable to the acquisition of Shares that may be issued pursuant to this
Agreement (and the Board of Directors of Antec has taken all action to approve
the acquisition of the Shares to the extent necessary to avoid such
application). Additionally, Antec will not avoid or seek to avoid (whether by
charter amendment or through reorganization, consolidation, merger, issuance of
rights, dissolution or sale of assets, or by any other voluntary act) the
observance or performance of any of the covenants, agreements or conditions to
be observed or performed under this Agreement by Antec and Antec will not take
any action which would cause any of its representations or warranties not to be
true in any material respect.
7. REPRESENTATIONS AND WARRANTIES OF NORTEL.
Nortel represents and warrants to Antec that:
a. The execution of this Agreement by Nortel and the consummation by
it of the transactions contemplated by this Agreement have been duly authorized
by all necessary corporate action on the part of Nortel and this Agreement has
been duly executed and delivered by a duly authorized officer of Nortel and
will constitute a valid and binding obligation of Nortel; and
b. If and when Nortel purchases the Shares, it will be acquiring the
Shares for its own account and not with a view to distribution or resale in any
manner which would be in violation of the Securities Act.
8. RESERVATION OF SHARES.
Antec agrees (i) that it shall at all times maintain, free from
preemptive rights, sufficient authorized but unissued shares of Antec Common
Stock so that the Shares may be issued without additional authorization by
Antec; and (ii) that it will not, by charter amendment or through
reorganization, consolidation, merger, dissolution or sale of assets, or by any
other voluntary act, avoid or seek to avoid the observance or performance of
any of the covenants to be observed or performed under this Agreement.
9. REGISTRATION RIGHTS.
A. Required Registrations.
a. At any time on or after the six month anniversary of the issuance
of the Shares, Nortel may request in writing that Antec file a Registration
Statement on the form required by the applicable rules, provided that no more
than two such requests may be made. Upon any such
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request, Antec shall, as expeditiously as possible, use its best efforts to
effect the registration of all Shares which Antec has been requested to so
register.
b. Antec shall be entitled to delay the filing or effectiveness of
any Registration Statement for up to 90 days in any 12 month period if the
offering would, in the judgment of the Board of Directors of Antec, require
premature disclosure of any material corporate development or otherwise
materially interfere with or adversely affect any pending or proposed offering
of securities of Antec or any other material transaction involving Antec.
B. Incidental Registration.
a. Subject to such limitations as may be imposed by the specific
terms of any legally binding written commitment undertaken by Antec prior to
March 31, 1999 and remaining in force and effect at the time of the exercise by
Nortel of its rights under this Section 9.B, whenever Antec proposes to file a
Registration Statement (other than pursuant to Section 9.A) at any time and
from time to time, it will, prior to such filing, give written notice to Nortel
of its intention to do so and, upon the written request of Nortel given within
20 days after Antec provides such notice (which request shall state the
intended method of disposition of such Shares), Antec shall use its best
efforts to cause all Shares which Antec has been requested by Nortel to
register to be registered under the Securities Act to the extent necessary to
permit their sale or other disposition in accordance with the intended methods
of distribution specified in the request of Nortel; provided that Antec shall
have the right to postpone or withdraw any registration effected pursuant to
this Section 9.B without obligation to Nortel. Notwithstanding the foregoing,
Antec is not required to give notice to Nortel or register the Shares if the
Registration Statement is to be filed pursuant to a legally binding written
commitment with a third party which provides demand registration rights and
prohibits incidental registration of securities or other holders in connection
therewith.
b. In connection with any registration under this Section 9.B
involving an underwriting, Antec shall not be required to include any Shares in
such registration unless the holders thereof accept the terms of the
underwriting as agreed upon between Antec and the underwriters selected by it
(provided that such terms must be consistent with this Agreement). If in the
opinion of the managing underwriter it is appropriate because of marketing
factors to limit the number of Shares to be included in the offering, then
Antec shall be required to include in the registration only that number of
Shares, if any, which the managing underwriter believes should be included
therein, provided that no persons or entities other than Antec shall be
permitted to include securities in the offering, subject to such requirements
as may be imposed on Antec by the specific terms of any legally binding written
commitment undertaken by Antec prior to March 31, 1999 for so long as such
requirements remain in force and effect.
C. Registration Procedures. If and whenever Antec is required by the
provisions of this Agreement to use its best efforts to effect the registration
of any of the Shares under the Securities Act, Antec shall:
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a. file with the Commission a Registration Statement with respect to
such Shares and use its best efforts to cause that Registration Statement to
become and remain effective;
b. as expeditiously as possible prepare and file with the Commission
any amendments and supplements to the Registration Statement and the prospectus
included in the Registration Statement as may be necessary to keep the
Registration Statement effective, in the case of a firm commitment underwritten
public offering, until each underwriter has completed the distribution of all
securities purchased by it and, in the case of any other offering, until the
earlier of the sale of all Shares covered thereby or 90 days after the
effective date thereof;
c. as expeditiously as possible furnish to Nortel such reasonable
numbers of copies of the prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such other
documents as Nortel may reasonably request in order to facilitate the public
sale or other disposition of the Shares; and
d. as expeditiously as possible use its best efforts to register or
qualify the Shares covered by the Registration Statement under the securities
or Blue Sky laws of such states as Nortel shall reasonably request, and do any
and all other acts and things that may be necessary or desirable to enable
Nortel to consummate the public sale or other disposition in such states of the
Shares; provided, however, that Antec shall not be required in connection with
this paragraph (d) to qualify as a foreign corporation or execute a general
consent to service of process in any jurisdiction.
If Antec has delivered preliminary or final prospectuses to Nortel and
after having done so the prospectus is amended to comply with the requirements
of the Securities Act, Antec shall promptly notify Nortel and, if requested,
Nortel shall immediately cease making offers of Shares and return all
prospectuses to Antec. Antec shall promptly provide Nortel with revised
prospectuses and, following receipt of the revised prospectuses, Nortel shall
be free to resume making offers of the Shares.
D. Standstill. If at any time Nortel holds 5% or more of the Common Stock,
it will agree, upon the reasonable recommendation of any underwriter involved
in the sale on behalf of Antec of Common Stock or securities which can be
converted into Common Stock, to refrain from selling any shares of Common Stock
for such period, not to exceed 90 days, which the underwriter may reasonably
recommend.
E. Allocation of Expenses. Antec will pay all Registration Expenses of all
registrations under this Agreement; provided, however, that if a registration
under Section 9.A is withdrawn at the request of Nortel (other than as a result
of information concerning the business or financial condition of Antec which is
made known to Nortel after the date on which such registration was requested)
and if Nortel elects not to have such registration counted as a registration
requested under Section 9.A, Nortel shall pay the Registration Expenses of such
registration. For purposes of this Section 9, the term "Registration Expenses"
shall mean all expenses incurred by Antec in complying with this Agreement,
including, without limitation, all registration and filing fees,
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exchange listing fees, printing expenses, fees and expenses of counsel for
Antec, state Blue Sky fees and expenses, and the expense of any special audits
incident to or required by any such registration, but excluding underwriting
discounts, selling commissions and the fees and expenses of counsel selected by
Nortel or any underwriter.
F. Indemnification and Contribution.
a. In the event of any registration of any of the Shares under the
Securities Act pursuant to this Agreement, Antec will indemnify and hold
harmless the seller of such Shares, each underwriter of such Shares, and each
other person, if any, who controls such seller or underwriter within the
meaning of the Securities Act or the Exchange Act against any losses, claims,
damages or liabilities, joint or several, to which such seller, underwriter or
controlling person may become subject under the Securities Act, the Exchange
Act, state securities or Blue Sky laws or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement under which such Shares were
registered under the Securities Act, any preliminary prospectus or final
prospectus contained in the Registration Statement, or any amendment or
supplement to such Registration Statement, or arise out of or are based upon
the omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and Antec
will reimburse such seller, underwriter and each such controlling person for
any legal or any other expenses reasonably incurred by such seller, underwriter
or controlling person in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that Antec will
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon any untrue statement or omission
made in such Registration Statement, preliminary prospectus or final
prospectus, or any such amendment or supplement, in reliance upon and in
conformity with information furnished to Antec, in writing, by or on behalf of
such seller, underwriter or controlling person specifically for use in the
preparation thereof.
b. In the event of any registration of any of the Shares under the
Securities Act pursuant to this Agreement, each seller of Shares, severally and
not jointly, will indemnify and hold harmless Antec, each of its directors and
officers and each underwriter (if any) and each person, if any, who controls
Antec or any such underwriter within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages or liabilities, joint or
several, to which Antec, such directors and officers, underwriter or
controlling person may become subject under the Securities Act, Exchange Act,
state securities or Blue Sky laws or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement under which such Shares were registered
under the Securities Act, any preliminary prospectus or final prospectus
contained in the Registration Statement, or any amendment or supplement to the
Registration Statement, or arise out of or are based upon any omission or
alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, if the statement or
omission was made in reliance
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upon and in conformity with information relating to such seller furnished in
writing to Antec by or on behalf of such seller specifically for use in
connection with the preparation of such Registration Statement, prospectus,
amendment or supplement; provided, however, that the obligations of such
Stockholders hereunder shall be limited to an amount equal to the proceeds to
each Stockholder of Shares sold in connection with such registration.
c. Each party entitled to indemnification under this Section 9.F
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified
Party has actual knowledge of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party to assume the defense of any such claim
or any litigation resulting therefrom; provided, that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not be
unreasonably withheld); and, provided, further, that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 9.F, except to the
extent the Indemnifying Party may have been prejudiced by such failure. The
Indemnified Party may participate in such defense at such party's expense;
provided, however, that the Indemnifying Party shall pay such expense if
representation of such Indemnified Party by the counsel retained by the
Indemnifying Party would be inappropriate due to actual or potential differing
interests between the Indemnified Party and any other party represented by such
counsel in such proceeding. No Indemnifying Party, in the defense of any such
claim or litigation shall, except with the consent of each 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
of such claim or litigation, and no Indemnified Party shall consent to entry of
any judgment or settle such claim or litigation without the prior written
consent of the Indemnifying Party.
d. In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) any holder
of Shares exercising rights under this Agreement, or any controlling person of
any such holder, makes a claim for indemnification pursuant to this Section 9.F
but it is judicially determined (by the entry of a final judgment or decree by
a court of competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 9.F provides
for indemnification in such case, or (ii) contribution under the Securities Act
may be required on the part of any such selling Stockholder or any such
controlling person in circumstances for which indemnification is provided under
this Section 9.F; then, in each such case, Antec and such Stockholder will
contribute to the aggregate losses, claims, damages or liabilities to which
they may be subject (after contribution from others) in such proportions so
that such holder is responsible for the portion represented by the percentage
that the public offering price of its Shares offered by the Registration
Statement bears to the public offering price of all securities offered by such
Registration Statement, and Antec is responsible for the remaining portion;
provided, however, that, in any such case, (A) no such holder will be required
to contribute any amount in excess of the proceeds to it of all Shares sold by
it pursuant to such Registration Statement, and (B) no person or entity guilty
of fraudulent
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misrepresentation, within the meaning of Section 11(f) of the Securities Act,
shall be entitled to contribution from any person or entity who is not guilty
of such fraudulent misrepresentation.
G. Indemnification with Respect to Underwritten Offering. In the event
that Shares are sold pursuant to a Registration Statement in an underwritten
offering pursuant to Section 9.A, Antec agrees to enter into an underwriting
agreement containing customary representations and warranties with respect to
the business and operations of an issuer of the securities being registered and
customary provisions with respect to indemnification by Antec of the
underwriters of such offering.
H. Limitations on Subsequent Registration Rights. Antec shall not, without
the prior written consent of Nortel, enter into any agreement (other than this
Agreement) with any holder or prospective holder of any securities of Antec
which would allow such holder or prospective holder to include securities of
Antec in any Registration Statement filed at the request of Nortel under this
Agreement, subject to such requirements as may be imposed by the specific terms
of any legally binding written commitment undertaken by Antec prior to March
31, 1999 for so long as such requirements remain in force and effect.
I. Rule 144 Requirements. Antec agrees to:
a. comply with the requirements of Rule 144(c) under the Securities
Act with respect to current public information about Antec;
b. use its best efforts to file with the Commission in a timely
manner all reports and other documents required of Antec under the Securities
Act and the Exchange Act (at any time after it has become subject to such
reporting requirements); and
c. furnish to any holder of Shares upon request (i) a written
statement by Antec as to its compliance with the requirements of said Rule
144(c), and the reporting requirements of the Securities Act and the Exchange
Act (at any time after it has become subject to such reporting requirements),
(ii) a copy of the most recent annual or quarterly report of Antec, and (iii)
such other reports and documents of Antec as such holder may reasonably request
to avail itself of any similar rule or regulation of the Commission allowing it
to sell any such securities without registration.
10. MERGERS, ETC.
Antec shall not, directly or indirectly, enter into any merger,
consolidation or reorganization in which Antec shall not be the surviving
corporation unless the proposed surviving corporation shall, prior to such
merger, consolidation or reorganization, agree in writing to assume the
obligations of Antec under this Agreement, and for that purpose references
hereunder to "Shares" shall be deemed to be references to the securities which
Nortel would be entitled to receive in exchange for Shares under any such
merger, consolidation or reorganization; provided, however, that the provisions
of this Section 10 shall not apply in the
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event of any merger, consolidation or reorganization in which Antec is not the
surviving corporation if Nortel is entitled to receive in exchange for its
Shares consideration consisting solely of (i) cash, (ii) securities of the
acquiring corporation which may be immediately sold to the public without
registration under the Securities Act, or (iii) securities of the acquiring
corporation which the acquiring corporation has agreed to register within 90
days of completion of the transaction for resale to the public pursuant to the
Securities Act.
11. RESTRICTIONS ON TRANSFER
Nortel agrees not to assign, sell, pledge, transfer or otherwise dispose of or
transfer any Shares unless registered under the Securities Act and applicable
state securities laws, or an opinion is given by counsel satisfactory to Antec
that such registration is not required. Each certificate representing the
Shares will contain a legend substantially as follows:
"The shares represented by this Certificate have not been
registered under the Securities Act of 1933. They may not be
offered or transferred by sale, assignment, pledge or
otherwise unless (i) a registration statement for the shares
under the Securities Act of 1933 is in effect or (ii) the
corporation has received an opinion of counsel, which opinion
is satisfactory to the corporation, to the effect that such
registration is not required under the Securities Act of
1933."
The foregoing legend shall be removed from the certificates representing the
Shares, at the request of the holder thereof, at such time as they become
eligible for resale pursuant to Rule 144(k) under the Securities Act.
12. MISCELLANEOUS
a. Notices.01. Notices. All notices, consents, approvals, reports,
designations, requests, waivers, elections and other communications
(collectively, "Notices") authorized or required to be given pursuant to this
Agreement shall be given in writing and either personally delivered to the
party to whom it is given or delivered by an established delivery service by
which receipts are given or mailed by registered or certified mail, postage
prepaid, or sent by telex or telegram or electronic telecopier, addressed to
the party at its address listed below. Any party may change its address for the
receipt of Notices at any time by giving Notice thereof to the other party.
If to Nortel:
Nortel Networks
c/o Northern Telecom Inc.
Northern Telecom Plaza
▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
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With a copy to:
Northern Telecom, Inc.
Office of the General Counsel
Northern Telecom Plaza
▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
If to Antec:
Antec Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
b. Entire Agreement.02. Entire Agreement. This Agreement, together
with the other agreements referenced herein, supersede all prior agreements and
understandings among the parties hereto with respect to the subject matter
hereof.
c. Modification.03. Modification. No change or modification of this
Agreement shall be of any force unless such change or modification is in
writing and has been signed by the parties hereto.
d. Waivers.04. Waivers. No waiver of any breach of any of the terms
of this Agreement shall be effective unless such waiver is in writing and
signed by the party against which such waiver is claimed. No waiver of any
breach shall be deemed to be a waiver of any other or subsequent breach.
e. Severability.05. Severability. If any provision of this
Agreement shall be held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
f. Further Assistance.06. Further Assistance. Antec shall execute
such additional deeds, assignments, endorsements and other instruments and
documents and shall give such further assurances as shall be necessary to
perform its obligations hereunder.
g. Governing Law.07. Governing Law. This Agreement shall be
governed by and be construed in accordance with the laws of the State of New
York without regard to its choice of law rules.
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h. Jurisdiction.08. Jurisdiction. The parties hereto irrevocably
submit to the jurisdiction of the courts of the State of New York and of the
United States sitting in New York in respect of any action or proceeding
against them relating in any way to this Agreement (a "Proceeding"). Any
process or summons for purposes of any Proceeding may be served on it by
mailing a copy thereof by registered mail, or a form of mail substantially
equivalent thereto, addressed to the party at its address as provided for
Notices hereunder.
i. Waiver of Jury Trial.09. Waiver of Jury Trial. THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
j. Counterparts.10. Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an original, but all
of which shall constitute one and the same instrument.
k. Limitation on Rights of Others.11. Limitation on Rights of
Others. No Person other than a party hereto shall have any legal or equitable
right, remedy or claim under or in respect of this Agreement.
l. Successors and Assigns.14. Successors and Assigns. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. Nortel shall be
permitted to assign its rights hereunder to any transferee of all or part of
the Shares, provided that such transferee agrees to be bound by the provisions
hereof.
m. Expenses.15. Expenses. Each party hereto shall bear its own
expenses in connection with the drafting, negotiation and implementation of
this Agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the opening of business on the day and year first above
written.
ANTEC CORPORATION NORTEL NETWORKS LLC
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇. ▇▇▇▇▇▇▇▇
Name: Name:
Title: Title:
[Signature Page to Earnout Share Agreement]
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