EXHIBIT 11
LOCK-UP AGREEMENT
March 11, 2003
CIBC WORLD MARKETS CORP.
000 Xxxxxxxxx Xxxxxx, 0xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Arris Group, Inc. -- Offering of Convertible Notes
Ladies and Gentlemen:
The undersigned understands that you have entered into a Purchase
Agreement (the "Purchase Agreement") with Arris Group, Inc., a Delaware
corporation (the "Company"), providing for the private offering (the "Rule 144A
Offering") by you (the "Initial Purchaser") of notes (the "Notes") convertible
into common stock (the "Common Stock") of the Company. Capitalized terms used
herein and not otherwise defined shall have the meanings set forth in the
Purchase Agreement.
In consideration of your agreement to purchase and make the Rule
144A Offering of the Notes, and for other good and valuable consideration the
receipt of which is hereby acknowledged, the undersigned hereby agrees that,
except as set forth in the following paragraph, without your prior written
consent, which shall not be unreasonably withheld, the undersigned will not,
during the period (the "Lock-Up Period") ending 90 days after the date of the
offering circular relating to the Rule 144A Offering (the "Circular"), (1)
offer, pledge, announce the intention to sell, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase, or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock of the Company or any
securities convertible into or exercisable or exchangeable for Common Stock
(including, but not limited to, Common Stock which may be deemed to be
beneficially owned by the undersigned in accordance with the rules and
regulations of the Securities and Exchange Commission and securities which may
be issued upon exercise of a stock option or warrant) other than (A) as a bona
fide gift or bona fide gifts, provided, however, that the recipient of such bona
fide gift or bona fide gifts shall execute a copy of and be bound by the terms
of, this Agreement or (B) the sale of any shares of Common Stock acquired upon
the exercise of options granted under the Company's stock option or stock
incentive plans that would otherwise expire during the Lock-Up Period, or (2)
enter into any swap, option, future, forward or other agreement that transfers,
in whole or in part, any of the economic consequences of ownership of the Common
Stock or any securities of the Company which are substantially similar to the
Common Stock, including, but not limited to, any security convertible into or
exercisable or exchangeable for Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise.
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The Initial Purchaser acknowledges and agrees that, notwithstanding
the foregoing paragraph, nothing in this Lock-Up Agreement shall prohibit the
undersigned from (1) entering into an option agreement with the Company for the
sale by the undersigned to the Company of up to 16,000,000 shares of Common
Stock held by the undersigned, or selling any shares to the Company upon one or
more exercises of such option, (2) the loaning of shares of Common Stock to the
Initial Purchaser pursuant to the Master Securities Loan Agreement dated as of
March 11, 2003 by and between the undersigned and the Initial Purchaser, (3) the
making of any demand for or the exercising of any right with respect to the
registration of up to 6,000,000 shares of Common Stock or any security
convertible into or exercisable or exchangeable for Common Stock or (4) the
announcement or disclosure of any of the foregoing as required by law.
In furtherance of the foregoing, the Company and any duly appointed
transfer agent for the registration or transfer of the securities described
herein are hereby authorized to decline to make any transfer of securities if
such transfer would constitute a violation or breach of this Lock-Up Agreement.
The undersigned hereby represents and warrants that the undersigned
has full power and authority to enter into this Lock-Up Agreement. All authority
herein conferred or agreed to be conferred and any obligations of the
undersigned shall be binding upon the successors, assigns, heirs or personal
representatives of the undersigned.
The undersigned understands that, if the Purchase Agreement (other
than the provisions thereof which survive termination) shall terminate or be
terminated prior to payment for and delivery of the Common Stock to be sold
thereunder, this Lock-Up Agreement shall terminate and be of no further force or
effect, and the undersigned shall be released from all obligations under this
Lock-Up Agreement.
The undersigned understands that the Initial Purchaser proposes to
proceed with the Rule 144A Offering in reliance upon this Lock-Up Agreement.
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THIS LOCK-UP AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE
CONFLICTS OF LAWS PROVISIONS THEREOF.
Very truly yours,
Nortel Networks Inc.
By: /s/ Khush Dadyburjor
-------------------------------------
Name: Khush Dadyburjor
Title: Attorney-In-Fact
Accepted as of the date first set forth above:
CIBC WORLD MARKETS CORP.
By: /s/ X. XxxXxxxx
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Name: Xxxxxx XxxXxxxx
Title: Managing Director
