Exhibit 2.1
EXECUTION COPY
--------------
AMENDED AND RESTATED
MEMORANDUM OF UNDERSTANDING
BY AND BETWEEN
THE FURUKAWA ELECTRIC CO., LTD.
AND
COMMSCOPE, INC.
DATED AS OF NOVEMBER 15, 2001
TABLE OF CONTENTS
ARTICLE I
DEFINED TERMS
Section 1.1. Defined Terms.......................................1
Section 1.2. Other Defined Terms.................................5
ARTICLE II
INVESTMENT IN THE CABLE JV
Section 2.1. Investment Commitment...............................5
Section 2.2. Investment in the Cable JV..........................6
Section 2.3. Effect of Reduction in Purchase Price...............6
Section 2.4. Contribution to the Cable JV........................6
Section 2.5. Working Capital Commitments.........................6
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Representations and Warranties of Furukawa..........7
Section 3.2. Representations and Warranties of CommScope.........7
ARTICLE IV
ARRANGEMENT OF INTELLECTUAL PROPERTY MATTERS
Section 4.1. Cable Cross-License Agreement.......................8
Section 4.2. Additional Intellectual Property Matters............8
ARTICLE V
CONTRACTUAL ARRANGEMENTS
Section 5.1. Matters Relating to the Purchase Agreement..........8
Section 5.2. Optical Fiber Supply Agreement......................9
Section 5.3. CommScope Sales and Marketing Arrangement..........10
Section 5.4. Letter Agreement...................................10
Section 5.5. Amended LLC Agreement..............................10
Section 5.6. Right to Put Membership Interest in the Cable JV...11
Section 5.7. Registration Rights................................12
Section 5.8. Fiber Sourcing.....................................12
Section 5.9. Fitel USA..........................................12
Section 5.10. Revolving Credit Agreement.........................12
-i-
ARTICLE VI
PUBLIC STATEMENTS; CONFIDENTIALITY
Section 6.1. Public Statements..................................13
Section 6.2. Confidentiality....................................13
Section 6.4. Privileged Information.............................13
ARTICLE VII
COOPERATION
Section 7.1. Cooperation........................................14
Section 7.2. Division of OFS....................................15
ARTICLE VIII
EMPLOYEE RELATED MATTERS
Section 8.1. Non-Solicitation...................................15
ARTICLE IX
CONDITIONS
Section 9.1. Furukawa Conditions................................16
Section 9.2. CommScope Conditions...............................16
ARTICLE X
TERMINATION
Section 10.1. Termination........................................16
Section 10.2. Effect of Termination..............................17
ARTICLE XI
GENERAL PROVISIONS
Section 11.1. Expenses...........................................17
Section 11.2. Assignment.........................................18
Section 11.3. Governing Law......................................18
Section 11.4. Entire Agreement...................................18
Section 11.5. Counterparts.......................................18
Section 11.6. Amendment..........................................18
Section 11.7. Successors and Assigns.............................18
Section 11.8. Notices............................................18
Section 11.9. Third-Party Beneficiaries..........................19
Section 11.10. Survival...........................................19
Section 11.11. Consent to Jurisdiction............................19
Section 11.12. Waiver of Jury Trial...............................20
-ii-
EXHIBITS
Exhibit 1.1 Amended and Restated Limited Liability Company Agreement
of OFS BrightWave, LLC
Exhibit 2.4 Form of Closing Instruments
Exhibit 2.5 Form of CommScope Revolving Credit Agreement and Note
Exhibit 4.1 Form of Cable Cross-License Agreement
Exhibit 4.2 Patent Management Guidelines
Exhibit 5.2 Form of Optical Fiber Supply Agreement
Exhibit 6.1-A Press Release of CommScope, Inc.
Exhibit 6.1-B English Translation of the Press Release of The Furukawa
Electric Co., Inc.
-iii-
THIS AMENDED AND RESTATED MEMORANDUM OF UNDERSTANDING (this
"Agreement") is entered into as of November 15, 2001, by and
between The Furukawa Electric Co., Ltd., a corporation organized under the
laws of Japan ("Furukawa"), and CommScope, Inc., a Delaware corporation
("CommScope").
WHEREAS, Furukawa and Lucent Technologies Inc. ("Lucent") have
entered into an Asset and Stock Purchase Agreement, dated as of July 24,
2001, as amended by Amendment No. 1 to the Purchase Agreement, dated as of
November 15, 2001 (as amended, the "Purchase Agreement"), pursuant to
which, among other things, Furukawa agreed to purchase substantially all of
Lucent's Optical Fiber Solutions business other than Lucent's interest in
two joint ventures in China ("OFS"), subject to the terms and conditions
set forth in the Purchase Agreement;
WHEREAS, Furukawa and CommScope have entered into a Memorandum of
Understanding, dated as of July 24, 2001 (the "MOU"), pursuant to which,
among other things, Furukawa and CommScope agreed to form certain entities
(the "Joint Ventures") to jointly acquire and operate the Fiber Business
and the Cable Business (each as defined below);
WHEREAS, Furukawa and CommScope have entered into a letter
agreement, dated as of October 11, 2001 (the "Letter Agreement");
WHEREAS, Lucent, CommScope and Furukawa have entered into a
Financing Agreement, dated as of July 24, 2001, as amended and supplemented
by the Supplement to the Financing Agreement, dated as of November 9, 2001
(as supplemented, the "Financing Agreement"); and
WHEREAS, Furukawa and CommScope mutually desire to terminate the
Letter Agreement and amend and restate the MOU in its entirety to provide
for CommScope's continued participation in the OFS transaction on the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the
covenants and agreements set forth in this Agreement, and intending to be
legally bound hereby, Furukawa and CommScope agree to amend and restate the
MOU in its entirety as follows:
ARTICLE I
DEFINED TERMS
Section 1.1. Defined Terms. For purposes of this Agreement, the
following terms shall have the following meanings:
"Agreement" shall have the meaning set forth in the preamble.
"Amended LLC Agreement" means the amended and restated limited
liability company agreement of the Cable JV, by and among the Cable JV,
Furukawa (or its wholly owned Subsidiary) and CTV Member, in the form
attached hereto as Exhibit 1.1.
"Buyer Entity" means any one or more of the Cable JV Entities,
OFS Fitel, any Subsidiary or controlled Affiliate of OFS Fitel and/or any
branch or representative office of any of the foregoing.
"Cable Business" means the optical cable related assets and fiber
manufacturing facilities of OFS, other than the assets located in Denmark
or otherwise allocated to the Fiber Business, the Specialty Business or the
FOAP Business, which includes (i) the capital stock of Solutions, which
owns the Norcross Plant; (ii) the assets associated with the Norcross
Plant; (iii) the OFS assets of Lucent Technologies Network Systems do
Brazil Ltda. in Brazil; (iv) the OFS assets of Lucent Technologies
Nederland B.V. in The Netherlands; (v) the OFS assets of Lucent
Technologies NS GmbH (Fiber Cable) in Germany; and (vi) joint venture
interests in Lucent Technologies Sviazstroy Fiber Optic Cable Co. and Fitel
Lucent Technologies. Notwithstanding that the Norcross Plant manufactures
both cable and fiber, Solutions in its entirety is included in the Cable
Business. In addition, OFS's premise cable operations that are located at
the Norcross Plant will initially be part of the Cable Business until such
time as the FOAP Business is sold, at which time the parties shall agree on
a mutually satisfactory treatment of the premise cable operations.
"Cable JV" means OFS BrightWave, LLC, a Delaware limited
liability company, or such other entity designated by Furukawa, with
CommScope's prior written consent, under Section 1.3 of the Purchase
Agreement to acquire and operate the Cable Business, such consent not to be
unreasonably withheld.
"Cable JV Entity" means any of the Cable JV, any Subsidiary or
controlled Affiliate of the Cable JV and/or any branch or representative
office of any of the foregoing.
"Certificate" shall have the meaning set forth in Section 5.4
hereof.
"Closing Instruments" shall have the meaning set forth in Section
2.4 hereof.
"Commitment" means $203,388,000.00
"CommScope" shall have the meaning set forth in the preamble.
"CommScope Covered Entity" shall have the meaning set
forth in Section 8.2 hereof.
"CommScope Working Capital Amount" shall mean $30.0 million.
"Confidentiality Agreement" means the Confidentiality Agreement,
dated as of July 4, 2001, by and between Furukawa and CommScope.
"Covered Entity" shall have the meaning set forth in Section 8.1
hereof.
"Cross-License" shall have the meaning set forth in Section 4.1
hereof.
"CTV Member" shall have the meaning set forth in Section 2.2
hereof.
-2-
"CTV Stock" shall have the meaning set forth in Section 2.1
hereof.
"Employee Matters" shall have the meaning set forth in Section
7.1 hereof.
"Exercise Date" shall have the meaning set forth in Section 5.6
hereof.
"Exercise Period" shall have the meaning set forth in Section 5.6
hereof.
"Exercise Price" shall have the meaning set forth in Section 5.6
hereof.
"FOAP Business" means the assets and manufacturing facilities of
OFS relating to connectors, adapters, jumpers, closures, distribution
frames, premises cable and wiring harnesses.
"Fiber Business" means the optical fiber (including ocean fiber)
related assets and optical fiber (including ocean fiber) manufacturing
facilities of OFS (other than the assets of the Norcross Plant that are
allocated to the Cable Business), which includes (i) the assets associated
with OFS's Sturbridge, Massachusetts facilities and (ii) a joint venture
interest in Litespec Optical Fiber, LLC.
"Financing Agreement" shall have the meaning set forth in the
recitals.
"Fitel" means Fitel Lucent Technologies, a New York partnership.
"Fitel USA" means Fitel USA Corp., a Delaware corporation and the
sole-member of the Cable JV.
"Furukawa" shall have the meaning set forth in the preamble.
"Furukawa Covered Entity" shall have the meaning set forth in
Section 8.1 hereof.
"Furukawa Indemnity" shall have the meaning set forth in Section
5.5(c) hereof.
"Initial Entity" means any one or more of OFS Fitel Components
Inc., a Delaware corporation, OFS Fitel Laboratories Inc., a Delaware
corporation, OFS Lycom Inc., a Delaware corporation, Fitel IP Holdings LLC,
a Delaware limited liability company, and/or any Subsidiary of any of the
foregoing.
"Initial Ownership Percentage" shall have the meaning set forth
in Section 2.2 hereof.
"Investment" shall mean an amount equal to (i) the Commitment
less (ii) the CommScope Working Capital Amount.
"Letter Agreement" shall have the meaning set forth in the
recitals.
"Lucent" shall have the meaning set forth in the recitals.
-3-
"Lucent Indemnified Person" shall have the meaning set forth in
Section 5.1(a) hereof.
"MOU" shall have the meaning set forth in the recitals.
"Joint Ventures" shall have the meaning set forth in the
recitals.
"Norcross Plant" means the manufacturing facility owned by
Solutions that is located in Norcross, Georgia.
"OFS" shall have the meaning set forth in the recitals.
"OFS Fitel" means OFS Fitel, LLC, a Delaware limited liability
company, or such other entity designated by Furukawa under Section 1.3 of
the Purchase Agreement to acquire and operate the Fiber Business, the FOAP
Business, the Specialty Business and/or the Research Business.
"Purchase Agreement" shall have the meaning set forth in the
recitals.
"Reimbursable Expenses" means, and is limited solely to, the
reasonable out-of-pocket expenses incurred after July 24, 2001 through the
Closing by CommScope (or CommScope's outside accountants, consultants,
attorneys, advisors or other representatives) or Furukawa (or Furukawa's
outside accountants, consultants, attorneys, advisors or other
representatives) directly on behalf of any Buyer Entity (other than any
Initial Entity); provided that Reimbursable Expenses shall not include any
cost or expense incurred (a) in respect of any employee of CommScope or
Furukawa, as applicable, or any Subsidiary or Affiliate of CommScope or
Furukawa, as applicable, (b) in connection with or relating to CommScope's
or Furukawa's, as applicable, proposed financing or (c) in furtherance of
CommScope's or Furukawa's interest, as applicable, rather than the direct
interest of any Buyer Entity (including the negotiation of arrangements
between CommScope and Furukawa, or their respective Subsidiaries and
Affiliates, regarding the Buyer Entities or Initial Entities, and any
leases, licenses or other contractual arrangements between or among such
Buyer Entities or Initial Entities); provided, however, that,
notwithstanding the foregoing, any direct out-of-pocket cost incurred by
CommScope or Furukawa, as applicable, prior to July 24, 2001 to pay any
environmental consultant (other than any attorneys) to prepare an
environmental report covering OFS's properties shall be deemed to
constitute a Reimbursable Expense, up to and including the lesser of (i)
one-half of the aggregate of any such costs and (ii) $75,000, if such
report has been delivered to the other party hereto.
"Representative" means, with respect to any Person, any
Subsidiary or Affiliate of such Person, or any director, officer, employee,
member, partner, representative, agent, attorney, accountant, advisor or
consultant of any of such Person or any Subsidiary or Affiliate of such
Person, or any other Person or entity directly or indirectly controlled by
such Person or any of the foregoing.
"Research Business" means the research business of OFS heretofore
conducted or operated at Lucent's Bell Laboratories facilities.
-4-
"Revised Purchase Price" shall have the meaning set forth in
Section 2.3 hereof.
"Shin-Etsu Letter Agreement" means the letter agreement, dated as
of November 15, 2001, by and between Furukawa and Lucent, relating to the
Contractual Agreement, dated as of January 8, 2001, by and between Lucent
and Shin-Etsu Chemical Co., Ltd.
"Solutions" means Lucent Technologies Optical Fiber Solutions
Inc., a Delaware corporation.
"Specialty Business" means the specialty fiber related assets and
the specialty fiber manufacturing facilities of OFS, which includes (i) the
capital stock of Lucent Technologies Optical Specialty Fibers Inc., which
owns the Somerset, New Jersey facilities; (ii) the assets associated with
OFS's Somerset, New Jersey facilities or the Avon, Connecticut facilities;
(iii) the capital stock of Lucent Technologies Denmark Holdings ApS, which
owns (either directly or through its Subsidiaries) OFS's business located
in Denmark; and (iv) a joint venture interest in Lucent Technologies Yazaki
Ltd.
"Statement" means a reasonably detailed written statement of
Reimbursable Expenses, which shall include original invoices of all outside
accountants, consultants, attorneys, advisors or other representatives the
fees and expenses of which are indicated to be Reimbursable Expenses on
such statement.
"Supply Agreement" shall have the meaning set forth in Section
5.2 hereof.
"Transaction Information" means any information relating to
Furukawa, Lucent, OFS, any Buyer Entity, any Initial Entity, or any
Subsidiary or Affiliate of any of the foregoing that is defined to be
Confidential Information under either the Purchase Agreement or the
Confidentiality Agreement, or that has been prepared by CommScope,
Furukawa, Lucent, OFS, any Buyer Entity, any Initial Entity, any
Representative of any of the foregoing or otherwise that contains or
reflects any such Confidential Information, including, without limitation,
any such information contained or reflected in any documentation, oral or
written analyses, compilations, studies or other reports or documents and
any other written material that contains or reflects any such Confidential
Information.
Section 1.2. Other Defined Terms. Capitalized terms used but not
otherwise defined in this Agreement shall have the respective meanings
ascribed to such terms in the Purchase Agreement.
ARTICLE II
INVESTMENT IN THE CABLE JV
Section 2.1. Investment Commitment. Subject to the terms and
conditions set forth herein, CommScope shall deliver to Lucent at the
Closing, in lieu of a portion of the Purchase Price as contemplated by
Section 1 of the Financing Agreement, a number of shares of common stock,
par value $0.01 per share, of CommScope ("CTV Stock") and/or cash that in
the aggregate shall satisfy a portion of the Purchase Price equal to the
Commitment. Other than with respect to the CommScope Working Capital
Amount, any cash or shares of CTV Stock delivered
-5-
to Lucent by CommScope under this Section 2.1 shall be deemed to have been
contributed to the Cable JV as a capital contribution and shall be deemed
paid on behalf of the Cable JV in partial satisfaction of the Purchase
Price.
Section 2.2. Investment in the Cable JV. Provided that CommScope
shall have performed all obligations and agreements and complied in all
respects with all covenants and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing, including
without limitation its obligations under Section 2.1 hereof, at the
Closing, the Cable JV shall issue membership or other ownership interests
to CommScope or a wholly owned direct or indirect Subsidiary of CommScope
(such entity as designated by CommScope, the "CTV Member") such that the
CTV Member's relative limited liability company interest in the Cable JV,
as calculated immediately following such issuance (the "Initial Ownership
Percentage"), shall be equal to a fraction, (a) the numerator of which
shall be the Investment and (b) the denominator of which shall be
$940,677,227.73, subject to adjustment as set forth in Section 2.3 hereof.
Section 2.3. Effect of Reduction in Purchase Price. In the event
that Lucent agrees prior to the Closing to amend the Purchase Agreement to
reduce the Purchase Price (the "Revised Purchase Price") below
$2,300,000,000.00, the denominator set forth in Section 2.2(b) hereof shall
be amended by multiplying such amount by a fraction, (a) the numerator of
which shall be the Revised Purchase Price and (b) the denominator of which
shall be the Purchase Price (prior to such revision). Notwithstanding the
foregoing, in the event that any such reduction of the Purchase Price is
based in whole or in part on an issue that affects any Buyer Entity
disproportionately, the parties shall negotiate in good faith to adjust the
formula set forth in the first sentence of this Section 2.3 to reflect the
disproportionate impact of that issue. Notwithstanding anything contained
herein to the contrary, neither the denominator set forth in Section 2.2(b)
nor the amount to be funded (or deemed to be funded) to the Cable JV by
Furukawa (or its wholly owned Subsidiary) at the Closing shall be reduced
as a result of the hold back of any portion of the Purchase Price at the
Closing, whether pursuant to Section 8.5 of the Purchase Agreement or
otherwise.
Section 2.4. Contribution to the Cable JV. At the Closing,
Furukawa shall, pursuant to Section 1.3 of the Purchase Agreement,
substitute the Cable JV Entities in place of itself for performance to and
by Furukawa with respect to the Cable Business under the Purchase Agreement
and the Collateral Agreements. Such substitution and assignment shall be
effected by such bill of sale, assumption and assignment agreements
(together with any appendices thereto, the "Closing Instruments") as are
executed by the Cable JV Entities, Lucent and the Selling Subsidiaries at
the Closing to effect the transactions contemplated by this Agreement and
the Purchase Agreement with respect to the Cable Business, substantially in
the form attached hereto as Exhibit 2.4. At the Closing, Furukawa shall, or
shall cause the Cable JV Entities to, execute and deliver the Closing
Instruments. Any cash delivered to Lucent by Furukawa (or a Subsidiary of
Furukawa) at the Closing with respect to the Cable Business shall be deemed
to have been contributed to the Cable JV as a capital contribution and
shall be deemed paid on behalf of the Cable JV in partial satisfaction of
the Purchase Price.
Section 2.5. Working Capital Commitments. Provided that CommScope
shall have satisfied its obligations hereunder, including its obligations
under Section 2.1 hereof, at the
-6-
Closing, the CTV Member shall be deemed to have made a working capital loan
to the Cable JV pursuant to the terms of the loan agreement, the form of
which is attached hereto as Exhibit 2.5 (the "Revolving Credit Agreement"),
in an amount equal to the CommScope Working Capital Amount.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Representations and Warranties of Furukawa. Furukawa
represents and warrants to CommScope that:
(a) (i) execution and delivery of this Agreement by Furukawa, the
performance by Furukawa of its obligations hereunder, and the consummation
by Furukawa of the transactions contemplated hereby have been duly
authorized by all requisite corporate action on the part of Furukawa and
(ii) this Agreement has been duly executed and delivered by Furukawa and,
assuming the due execution and delivery by CommScope, constitutes a legal,
valid and binding obligation of Furukawa enforceable against it in
accordance with its terms;
(b) there is no action, suit or proceeding pending against
Furukawa or, to Furukawa's knowledge, threatened in any court or by or
before any other governmental agency or instrumentality which would
prohibit Furukawa from entering into, or that could have a material adverse
effect on Furukawa's ability to perform its obligations under, this
Agreement; and
(c) no consent, approval, order or authorization of, or
registration, declaration or filing with, any court, administrative agency
or commission or other governmental authority or instrumentality, domestic
or foreign, is required to be obtained by Furukawa that has not been
obtained in connection with the execution, delivery and performance of this
Agreement by Furukawa or the consummation by each of them of the
transactions contemplated hereby. The execution, delivery and performance
of this Agreement by Furukawa and the consummation of the transactions
contemplated hereby by Furukawa does not conflict with, or result in a
breach of, any law or regulation of any governmental authority applicable
to Furukawa or any material agreement to which Furukawa is a party.
Section 3.2. Representations and Warranties of CommScope.
CommScope represents and warrants to Furukawa that:
(a) (i) the execution and delivery of this Agreement by
CommScope, the performance by CommScope of its obligations hereunder, and
the consummation by CommScope of the transactions contemplated hereby have
been duly authorized by all requisite corporate action on the part of
CommScope and (ii) this Agreement has been duly executed and delivered by
CommScope and, assuming the due execution and delivery by Furukawa,
constitutes a legal, valid and binding obligation of CommScope enforceable
against it in accordance with its terms;
(b) there is no action, suit or proceeding pending against
CommScope or, to CommScope's knowledge, threatened in any court or by or
before any other governmental
-7-
agency or instrumentality which would prohibit CommScope from entering
into, or that could have a material adverse effect on CommScope's ability
to perform its obligations under, this Agreement;
(c) no consent, approval, order or authorization of, or
registration, declaration or filing with, any court, administrative agency
or commission or other governmental authority or instrumentality, domestic
or foreign, is required to be obtained by CommScope that has not been
obtained in connection with the execution, delivery and performance of this
Agreement by CommScope or the consummation by each of them of the
transactions contemplated hereby. The execution, delivery and performance
of this Agreement by CommScope and the consummation of the transactions
contemplated hereby by CommScope does not conflict with, or result in a
breach of, any law or regulation of any governmental authority applicable
to CommScope or any material agreement to which CommScope is a party; and
(d) CommScope has in its possession funds and/or authorized
stock reserved for issuance sufficient to satisfy its obligations
hereunder.
ARTICLE IV
ARRANGEMENT OF INTELLECTUAL PROPERTY MATTERS
Section 4.1. Cable Cross-License Agreement. At the Closing,
CommScope and the Fitel USA shall enter into a definitive cross-license
agreement, substantially in the form attached hereto as Exhibit 4.1 (the
"Cross-License").
Section 4.2. Additional Intellectual Property Matters. The Buyer
Entities shall hold, prosecute and maintain the Assigned Patents and the
Assigned Trademarks (each as defined by the Intellectual Property
Agreement), and shall engage in licensing and patent infringement
litigation, as contemplated by Exhibit 4.2 attached hereto.
ARTICLE V
CONTRACTUAL ARRANGEMENTS
Section 5.1. Matters Relating to the Purchase Agreement.
------------------------------------------
(a) Indemnification Rights; Enforcement. If any of Furukawa,
CommScope, the Buyer Entities, the Initial Entities, or any Representative
of any of the foregoing (each a "Lucent Indemnified Person") suffers or
incurs any loss or expense which is indemnifiable by Lucent pursuant to the
terms of the Purchase Agreement or any agreement entered into in connection
therewith, the Lucent Indemnified Person (through a party hereto or a Buyer
Entity) shall give prompt written notice to Furukawa and CommScope of that
loss or expense. If such loss or expense is incurred (in whole or in part)
by a Lucent Indemnified Person who does not have the right to exercise
indemnity rights against Lucent directly pursuant to the Purchase
Agreement, the relevant Buyer Entity or, if such Buyer Entity does not have
the right to exercise such indemnity rights against Lucent directly,
Furukawa shall, at such person's request and expense, exercise its rights
under the Purchase Agreement or relevant ancillary agreements on behalf of
such person to seek indemnity for such loss or expense from Lucent.
Furukawa and
-8-
CommScope shall, and shall cause their Representatives to, keep each other
fully informed in relation to the status of any such pending indemnity
claim. CommScope shall, and shall cause its Representatives to, not settle
or compromise any indemnity claim against Lucent relating to CommScope or
such Representatives (other than relating to the value of such Person's
financial investment in the Cable JV) without the consent of Furukawa, such
consent not to be unreasonably withheld. Any amounts received by a Buyer
Entity or Furukawa pursuant to any indemnity claim made on behalf of
another person who suffered the loss shall be turned over to such person.
If more than one Lucent Indemnified Person suffered the loss, such recovery
shall be divided among those Lucent Indemnified Persons in an equitable
manner. In the event that a Lucent Indemnified Person is precluded from
recovering a loss (or part thereof) that it would otherwise be indemnified
against by Lucent (whether in its own right or through the exercise of a
Buyer Entity's or Furukawa's rights under the Purchase Agreement) due
solely to the fact that Lucent has satisfied the 50% of Purchase Price cap
on its indemnification obligation under the Purchase Agreement, such Lucent
Indemnified Person shall be entitled to receive contribution from Lucent
Indemnified Persons that have received indemnity payments from Lucent
pursuant to Section 9.3(a) of the Purchase Agreement (whether in their own
right or through the exercise of a Buyer Entity's or Furukawa's rights
under the Purchase Agreement) based upon the amount each Lucent Indemnified
Person would have received if all of the claims pursuant to Section 9.3(a)
had been treated as a single claim. In addition to the foregoing, Furukawa
shall, at the reasonable request of CommScope, exercise such other rights
it may have pursuant to the Purchase Agreement, to the extent the exercise
of such rights is reasonably related to the Buyer Entities or their
respective businesses. In the event that Lucent seeks indemnification from
Furukawa or any of its Affiliates as a result of any claim attributable to
CommScope, CommScope shall indemnify, defend and hold harmless Furukawa (in
accordance with the procedures for indemnification set forth in the
Purchase Agreement, as if Furukawa were entitled to seek indemnification
from such person thereunder) against any such claim to the extent such
claim is determined to be attributable to CommScope. In the event that
Lucent seeks indemnification from CommScope or any of its Affiliates as a
result of any claim attributable to Furukawa or any Buyer Entity, Furukawa
or such Buyer Entity, as applicable, shall indemnify, defend and hold
harmless CommScope (in accordance with the procedures for indemnification
set forth in the Purchase Agreement, as if CommScope were entitled to seek
indemnification from such person thereunder) against any such claim to the
extent such claim is determined to be attributable to Furukawa or a Buyer
Entity, as applicable. Furukawa and CommScope shall, and shall cause their
respective Representatives to, cooperate such that any Lucent Indemnified
Persons coordinate their respective efforts to seek indemnification (either
directly or indirectly) from Lucent so as to maximize the potential
indemnity recovery to all Lucent Indemnified Persons.
(b) Notices. To the extent Furukawa receives any notices
pursuant to the Purchase Agreement prior to the Closing that relate to the
Cable Business, it shall promptly provide a copy of such notices to
CommScope.
(c) Shin-Etsu Letter Agreement. CommScope hereby consents to
the Shin-Etsu Letter Agreement.
Section 5.2. Optical Fiber Supply Agreement. At or prior to the
Closing Date, CommScope and Furukawa shall, or shall cause their
Subsidiaries to, enter into the definitive
-9-
optical fiber supply agreement, substantially in the form attached hereto
as Exhibit 5.2 (the "Supply Agreement").
Section 5.3. CommScope Sales and Marketing Arrangement. Subject
to applicable law, Furukawa and CommScope shall, and shall cause their
respective Subsidiaries to, negotiate in good faith to enter into an
agreement whereby CommScope would sell and market products manufactured by
the Buyer Entities.
Section 5.4. Letter Agreement. The Letter Agreement is hereby
terminated. Concurrent with the execution and delivery of this Agreement,
CommScope shall deliver to Furukawa (a) the certificate from Frank B.
Wyatt, II required under Section 3 of the Letter Agreement, dated the date
hereof (the "Certificate") and (b) the resignations of Frank B. Wyatt, II
and any other director, officer, employee or agent of CommScope or any
Subsidiary or Affiliate of CommScope from all positions held by any such
persons as a director, manager, officer, employee or agent of any Buyer
Entity. CommScope shall indemnify Furukawa and the Buyer Entities from any
loss or other liability resulting from or arising out of the failure of the
Certificate, or the certificate delivered by CommScope under the Letter
Agreement on October 11, 2001, to be true and complete in all respects.
Concurrent with the execution and delivery of this Agreement, CommScope
shall deliver to Furukawa original copies (or if originals are not
available, duplicate copies) of all formation and other documents, filings,
notices, certificates, powers of attorney, bank account information and any
other business documents or records, in each case as may relate to the
Buyer Entities, that were made or prepared by, or are in the possession of,
CommScope or any of its Representatives on or prior to the date of such
delivery that have not previously been delivered to Furukawa, in each case
with a reasonable explanation thereof. Notwithstanding anything to the
contrary contained in the Letter Agreement, none of Furukawa nor any
Representative of Furukawa shall have any liability or obligation to
CommScope or any Representative of CommScope under the Letter Agreement.
Section 5.5. Amended LLC Agreement.
---------------------
(a) At the Closing, Furukawa and CommScope shall, or shall
cause their respective wholly owned Subsidiaries to, execute and deliver
the Amended LLC Agreement and any other documents ancillary thereto.
(b) Notwithstanding anything contained herein to the contrary,
none of Furukawa, any Buyer Entity or any Representative of any of the
foregoing shall owe any fiduciary duty, other than the duty of a manager of
a limited liability company to act with the care of a reasonably prudent
person, to any Cable JV Entity or any equity holder or Affiliate of any of
the foregoing, and shall only have the duties explicitly set forth in the
Amended LLC Agreement. Notwithstanding anything contained herein or in the
Amended LLC Agreement to the contrary, no equity holder of the Cable JV or
any Representative of any such Person shall have any claim against any
other equity holder or any manager of the Cable JV, or any of their
respective Representatives, based upon or arising from a claimed breach of
a fiduciary duty, duty of loyalty, corporate opportunity doctrine, conflict
of interest or any similar basis, and each such Person hereby waives any
such claim on behalf of itself and its Subsidiaries and Affiliates. In
taking any action, making any decision or exercising any discretion with
respect to the Cable JV or its Subsidiaries, Furukawa and its
Representatives shall be entitled to consider such interests
-10-
and factors asthey desire, including their own interests or those of their
Affiliates, and shall have no duty or obligation (i) to give any
consideration to the interest of or factors affecting the Cable JV or any
other Person or (ii) to abstain from participating in any vote or other
action of the Cable JV or any of its Subsidiaries or Affiliates, or any
board of directors, board of managers or similar governing body of any of
the foregoing. Nothing contained in this Section 5.5 shall constitute a
waiver of any claim for breach of this Agreement by any party hereto.
(c) CommScope shall indemnify and hold harmless the Cable JV,
each member thereof, and any Affiliate of any of the foregoing (each, a
"Furukawa Indemnity") from any Losses and Expenses (as defined in the
Amended LLC Agreement) arising from (i) any breach by the CTV Member of
Section 4.19 or Section 6.9(c) of the Amended LLC Agreement (except, in the
case of Section 6.9(c) of the Amended LLC Agreement, to the extent that any
such Losses and Expenses result directly from Furukawa's (or its
Affiliates') failure to notify CommScope of an amendment, modification or
waiver of the Corning Patent License (as defined in the Amended LLC
Agreement), including Appendix A thereto) or (ii) any federal, state or
foreign antitrust law resulting from the participation of any CommScope
Optical Designee (as defined in the Amended LLC Agreement) in the affairs
of the Cable JV and its Subsidiaries.
Section 5.6. Right to Put Membership Interest in the Cable JV.
CommScope shall have the absolute and unconditional one-time right to sell
to Furukawa or Furukawa's designees (provided that no such designation
shall release Furukawa from any liabilities or obligations under this
Section 5.6) all, but not less than all, of the Membership Interests (as
defined in the Amended LLC Agreement) owned by CommScope and its Affiliates
for an amount in cash equal to $173,388,000.00 (the "Exercise Price"). The
put right set forth in this Section 5.6 may be exercised by CommScope by
the delivery of a written notice of exercise, which exercise shall be
irrevocable, to Furukawa (the date of such delivery, the "Exercise Date").
Such written notice of exercise may only be delivered during the period
(the "Exercise Period") commencing on the earlier to occur of (i) May 1,
2004 and (ii) the date that the Cable JV delivers to the CTV Member, in
accordance with Section 10.2 of the Amended LLC Agreement, audited
financial statements for the fiscal year ending December 31, 2003 and
ending on the date that is three months after such date. No exercise or
notice of exercise of the put right set forth in this Section 5.6 shall be
effective if made or delivered other than during the Exercise Period.
Furukawa or its designees shall pay the Exercise Price to CommScope no
later than 100 calendar days following the Exercise Date, by wire transfer
of immediately available funds to an account designated by CommScope no
later than five Business Days prior to the date of such payment. Furukawa
agrees that if any amount outstanding or capable of becoming outstanding
under the Revolving Credit Agreement is subordinated in right of payment to
any other indebtedness of the Company, then Furukawa hereby fully and
unconditionally guarantees the obligations of the Company under Section 3.2
of the Revolving Credit Agreement. If Furukawa fails to pay the Exercise
Price in full when due, Furukawa shall pay (i) default interest on the
Exercise Price at a rate per annum equal to Three-month LIBOR (as defined
in the Revolving Credit Agreement) plus 2.75% from the date that is 100
calendar days from the Exercise Date to the date the Exercise Price and all
accrued default interest are paid in full and (ii) all of CommScope's
reasonable out-of-pocket costs and expenses incurred to collect payment of
the Exercise Price and any accrued default interest thereon, it being
understood and agreed that CommScope shall be entitled to retain legal
counsel of its choice.
Section 5.7. Registration Rights. Following an initial public
offering of securities of the Cable JV or any entity in which the Cable JV
is reorganized in contemplation of an initial public offering, CommScope
shall have (a) four demand registration rights to sell,
-11-
pursuant to any such demand registration, in each case, not less than (i)
$75 million of its equity interest in the Cable JV and (ii) 5% of the
fully-diluted equity interests in the Cable JV then outstanding and (b)
unlimited piggyback rights with respect to its equity interest in the Cable
JV; provided that, in the event that any managing underwriter in any such
offering with respect to which CommScope seeks to exercise its piggyback
rights advises Furukawa or its Subsidiaries that CommScope's participation
in such offering, for any reason, including without limitation the
resulting size of the aggregate equity interests contemplated to be sold in
the offering or the identity of the proposed sellers of such equity
interests in such offering, would adversely affect the marketing of the
distribution contemplated by such offering or the timing or terms of such
offering obtained by the sellers in such offering, CommScope shall (but
none of Furukawa, the Cable JV or any Subsidiary of Furukawa shall be
required to) reduce or eliminate, as advised by any managing underwriter,
the amount of equity interests in the Cable JV to be sold by CommScope in
such offering. Furukawa and CommScope shall negotiate customary terms
(including lock-up and black-out restrictions) with respect to such
registration rights. Notwithstanding the foregoing, nothing herein shall
require the Cable JV, or Furukawa to cause the Cable JV, to engage in any
initial public offering of any securities of the Cable JV or any Subsidiary
of the Cable JV, or otherwise offer or sell any securities of the Cable JV
or any Subsidiary of the Cable JV in any public offering or otherwise.
Section 5.8. Fiber Sourcing. CommScope acknowledges and agrees
that, except as set forth in the Supply Agreement, notwithstanding anything
contained herein to the contrary, none of Furukawa, the Cable JV, any other
Buyer Entity nor any Representative of any of the foregoing shall have any
obligation to procure fiber from, place orders for fiber with or utilize
the fiber manufacturing capacity of, any Cable JV Entity (even if such
fiber is to be used by or on behalf of a Cable JV Entity). CommScope
acknowledges and agrees that, notwithstanding the fact that Fitel is
expected to be a wholly owned subsidiary of the Cable JV, Furukawa (rather
than any Cable JV Entity) shall have the right to supply all of the fiber
requirements of Fitel and any successor or assign thereof.
Section 5.9. Fitel USA. CommScope acknowledges and agrees that,
notwithstanding anything contained herein to the contrary, any Cable JV
Entity may procure such services from Furukawa, Fitel USA or their
Affiliates as may be deemed necessary or advisable in the sole discretion
of Furukawa, Fitel USA and/or any such Cable JV Entity, including without
limitation transition services procured from Lucent under the Transition
Services Agreement and such other operational and/or administrative
services commonly provided by a parent entity to its Subsidiaries; all
determinations with respect to the nature, scope, fees and other bases on
which such services may be provided to any Cable JV Entity (which may or
may not be at arm's-length) shall be made in the sole discretion of
Furukawa, Fitel USA and/or such Cable JV Entity.
Section 5.10. Revolving Credit Agreement. At or prior to the
Closing Date, CommScope and Furukawa shall cause their Subsidiaries to
enter into the Revolving Credit Agreement.
-12-
ARTICLE VI
PUBLIC STATEMENTS; CONFIDENTIALITY
Section 6.1. Public Statements. Promptly following the execution
and delivery of this Agreement, CommScope shall issue the press release
attached hereto as Exhibit 6.1-A and Furukawa shall issue a press release in
Japanese, the English translation of which is attached hereto as Exhibit
6.1-B. CommScope shall, and shall cause its Representatives, (i) not to
make other public statements with respect to this Agreement (or the MOU),
the Letter Agreement or the transactions contemplated hereby or thereby,
without the prior written consent of Furukawa, except as may be required by
law (provided that CommScope furnishes Furukawa with prior notice and the
opportunity to comment upon any proposed statement required by law) and
(ii) for 24 months following the date of this Agreement, not to make any
public statements disparaging Furukawa, OFS, the Buyer Entities, any
Subsidiary or Affiliate of Furukawa or the business, financial condition,
strategy, prospects, methods of operation, results of operations or
employees of any of the foregoing. Furukawa shall, and shall cause its
Representatives, for 24 months following the date of this Agreement, not to
make any public statements disparaging CommScope, any Subsidiary or
Affiliate of CommScope or the business, financial condition, strategy,
prospects, methods of operation, results of operations or employees of any
of the foregoing that is inconsistent with the statement of Furukawa
attached hereto as Exhibit 6.1-B.
Section 6.2. Confidentiality.
---------------
(a) Except as set forth in Section 6.3 hereof, CommScope
shall, and shall cause its Subsidiaries and Affiliates to, maintain all
Transaction Information in accordance with the terms and conditions of the
Confidentiality Agreement as if such information were Confidential
Information as defined by the Confidentiality Agreement; provided that any
provision permitting CommScope to disclose any Transaction Information to
any of its financing sources or any other Person shall be deemed to be
deleted therefrom from the date hereof. Notwithstanding anything contained
herein or in the Confidentiality Agreement to the contrary (and, to the
extent that such agreements are in effect, except as expressly permitted by
the Cross-License or the Supply Agreement), CommScope shall, and shall
cause its Subsidiaries and Representatives, not to use any Transaction
Information, or information otherwise received from any Cable JV Entity,
for any purpose whatsoever other than for the purpose of monitoring its
minority equity investment in the Cable JV. By way of example, and not
limiting the generality of the foregoing, CommScope shall, and shall cause
its Subsidiaries and Representatives to, not use any Transaction
Information, or information otherwise received from the Cable JV, to
manufacture optical fiber (including ocean fiber).
(b) To the extent that CommScope or its Representatives have
provided to Furukawa any Confidential Information that relates exclusively
to CommScope's business or operations, Furukawa shall maintain such
Confidential Information in accordance with the terms and conditions of the
Confidentiality Agreement as if such information were Confidential
Information thereunder.
Section 6.3. Privileged Information. Without Furukawa's prior
written consent, CommScope shall not waive any privilege in respect of any
Transaction Information or other
-13-
oral or written communications or materials made or prepared in connection
with the transactions contemplated by this Agreement (or the MOU), by the
Purchase Agreement, the Letter Agreement or any Collateral Agreement.
ARTICLE VII
COOPERATION
Section 7.1. Cooperation. Whether before, at or after the
Closing, CommScope shall, and shall cause its Representatives to, cooperate
with and use their reasonable best efforts to assist Furukawa, the Buyer
Entities and their Representatives in doing all things necessary, proper or
advisable to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated hereby and/or by the Purchase
Agreement or the Collateral Agreements, as such transactions relate to the
aspects of the Buyer Entities that CommScope had participated in prior to
the date hereof (other than the Initial Entities), including using
reasonable best efforts to facilitate the transition of Furukawa as
supervisor over the formation, establishment and preparation of the Buyer
Entities and the establishment of plans, programs and procedures to provide
compensation and benefits to employees and otherwise to enable the Buyer
Entities to manage their respective work forces ("Employee Matters")
(including coordinating with any outside accountants, consultants,
attorneys or advisors retained by Furukawa, CommScope and/or any Buyer
Entity in connection with the transactions contemplated by this Agreement
(or the MOU), the Purchase Agreement or the Collateral Agreements). Without
limiting the generality of the foregoing, CommScope shall make the persons
described in the next sentence available to Furukawa, the Buyer Entities
and their Representatives for consultation and information transfer to the
extent reasonably necessary or advisable to assist Furukawa, the Buyer
Entities and their Representatives to accomplish the tasks described in the
preceding sentence in a timely and efficient manner; provided, that,
following the Closing, (a) CommScope shall not be obligated to make any
such persons available to the extent that it would materially disrupt
CommScope's business and (b) Furukawa or such Buyer Entities, as
applicable, shall reimburse CommScope for its reasonable out-of-pocket cost
and expense of making such persons available after the Closing. The persons
referred to in the preceding sentence are those employees or
Representatives of CommScope who have knowledge or experience with respect
to the work that has been done by CommScope or its Representatives
regarding Lucent, OFS and/or the Buyer Entities, in each case, in
connection with the transactions contemplated by this Agreement (or the
MOU), the Purchase Agreement or the Collateral Agreements, including
without limitation work relating to the hiring of OFS employees, the
provision of human resources transition services by Lucent and/or other
Employee Matters. CommScope hereby agrees to waive any conflict of interest
that could preclude Furukawa, the Buyer Entities or any Subsidiary,
Affiliate, successor or assign of any of the foregoing from using any
outside accountants, consultants, attorneys, advisors or other persons to
assist with the efforts described in this Section 7.1. From time to time,
whether before, at or following the Closing, Furukawa and CommScope shall,
and shall cause their respective Affiliates to, execute, acknowledge and
deliver all such further conveyances, notices, assumptions, releases and
acquittances and such other instruments, and shall take such further
actions, as may be necessary or appropriate to assure fully to the Cable JV
and the other Buyer Entities all of the properties, rights, titles,
interests, estates, remedies, powers and privileges intended to be conveyed
to the Cable JV and the other Buyer Entities at the Closing and to assure
-14-
fully to the Cable JV and the other Buyer Entities the assumption of the
liabilities and obligations intended to be assumed by the Cable JV and the
other Buyer Entities at the Closing.
Section 7.2. Division of OFS.
---------------
(a) Furukawa shall, with the support of CommScope and Lucent,
determine the allocation of the assets and liabilities of OFS to be
acquired pursuant to the Purchase Agreement that constitute the Cable
Business. Furukawa shall consult with CommScope regarding the allocation of
such assets and liabilities to the Cable Business.
(b) At the Closing, the Cable JV Entities shall acquire the
Cable Business from Lucent for the price of $940,677,227.72, subject to the
adjustments set forth in the Purchase Agreement and Section 2.3 hereof.
(c) At the Closing, Furukawa, through one or more Buyer
Entities other than the Cable JV Entities, shall acquire the Fiber
Business, the Specialty Business, the FOAP Business and/or the Research
Business for the price of $1,359,322,772.28, subject to the adjustments set
forth in the Purchase Agreement and Section 2.3 hereof.
ARTICLE VIII
EMPLOYEE RELATED MATTERS
Section 8.1. Non-solicitation. None of CommScope or its
Affiliates shall at any time prior to three years from the Closing,
directly or indirectly, solicit the employment of any employee of Furukawa,
OFS, the Buyer Entities, any Subsidiary or Affiliate of any of the
foregoing or any successor or assign of any of the foregoing (each a
"Furukawa Covered Entity") without Furukawa's prior written consent. None
of Furukawa or its Affiliates shall at any time prior to three years from
the Closing, directly or indirectly, solicit the employment of any employee
of CommScope, any Subsidiary or Affiliate of CommScope or any successor or
assign of any of the foregoing (each a "CommScope Covered Entity," and
together with the Furukawa Covered Entities, the "Covered Entities")
without CommScope's prior written consent; provided, however, that Furukawa
may solicit the employment of Marvin S. Edwards, Jr. For purposes of this
Section 8.1, the term "solicit the employment" shall not be deemed to
include (a) generalized searches for employees through media
advertisements, employment firms or otherwise that are not focused on
persons employed by any Covered Entity or (b) circumstances in which
employees of a Covered Entity provide unsolicited applications for
employment to such person (other than in response to a search covered by
clause (a) above). This restriction shall not apply to any employee whose
employment with a Covered Entity is involuntarily terminated by such
Covered Entity after the Closing. Solicitation of employment shall be
deemed to occur if the persons who perform such solicitation have knowledge
of this restriction or if such persons have no knowledge of this
restriction but a party hereto or its Affiliate's employees with knowledge
of this restriction have advance knowledge of any such solicitation. Each
of Furukawa and CommScope shall use its reasonable best efforts to
communicate the restrictions imposed by this Section 8.1 to all persons who
would reasonably be expected to engage in such solicitations and instruct
such persons to comply with such restrictions.
-15-
ARTICLE IX
CONDITIONS
Section 9.1. Furukawa Conditions. The obligations of Furukawa to
effect the consummation of the transactions contemplated hereby are subject
to the fulfillment, prior to or at the Closing, of each of the following
conditions, any of which may be waived in writing by Furukawa in its sole
discretion:
(a) the Closing shall be consummated substantially
simultaneously; and
(b) CommScope shall have performed in all material respects
all obligations and agreements and complied in all material respects with
all covenants and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing, including executing the
documents contemplated hereby.
Section 9.2. CommScope Conditions. The obligations of CommScope
to effect the consummation of the transactions contemplated hereby are
subject to the fulfillment, prior to or at the Closing, of each of the
following conditions, any of which may be waived in writing by CommScope in
its sole discretion:
(a) other than Amendment No. 1 to the Purchase Agreement,
there shall have been no amendment to the Purchase Agreement or Collateral
Agreements that is materially adverse to the Cable Business or CommScope's
interest therein;
(b) each of the conditions set forth in Section 8.1, Section
8.2(a) and Section 8.2(b) of the Purchase Agreement shall have been
satisfied and each of the Collateral Agreements shall have been delivered
to CommScope, in each case at or prior to the Closing, other than such
conditions that Furukawa may waive, after notice to CommScope, which do not
have a material adverse effect on the Cable Business or CommScope's
interest therein;
(c) the Closing shall be consummated substantially
simultaneously; and
(d) Furukawa shall have performed in all material respects all
obligations and agreements and complied in all material respects with all
covenants and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing, including executing the
documents contemplated hereby.
ARTICLE X
TERMINATION
Section 10.1. Termination. This Agreement may be terminated at
any time prior to the Closing Date by:
(a) Mutual Consent. The mutual written consent of Furukawa and
CommScope;
-16-
(b) Termination of the Purchase Agreement. Furukawa or
CommScope, if the Purchase Agreement is terminated in accordance with its
terms;
(c) Failure of Furukawa Condition. Furukawa upon written
notice to CommScope if any of the conditions set forth in Section 9.1
hereof shall have become incapable of fulfillment and shall not have been
waived in writing by Furukawa;
(d) Failure of CommScope Condition. CommScope upon written
notice to Furukawa if any of the conditions set forth in Section 9.2 hereof
shall have become incapable of fulfillment and shall not have been waived
in writing by CommScope; or
(e) Breach. By Furukawa or CommScope, if the other party
hereto shall have breached or failed to comply in any material respect with
any of its agreements or obligations under this Agreement, which breach,
except in the case of a breach of Section 2.1 hereof, shall not have been
cured, if curable, within two Business Days following notice of such breach
but in any event prior to the Closing Date.
Section 10.2. Effect of Termination. In the event of the
termination of this Agreement in accordance with Section 10.1 hereof, (a)
this Agreement shall become void and have no effect, without any liability
on the part of any party hereto or its directors, officers or stockholders,
except for the representations, warranties and obligations of the parties
hereto as set forth in Article III, Section 5.4, Article VI (provided that,
in the event of a termination pursuant to Section 10.1(e), the obligations
set forth in Section 6.1 shall not apply to the non-breaching party from
and after such termination), Section 7.1, Section 8.1 and this Section
10.2, each of which shall survive the termination of this Agreement,
provided that, notwithstanding anything in this Agreement to the contrary,
neither Furukawa nor CommScope shall be relieved or released from any
liabilities or damages arising out of its breach of any provision of this
Agreement and (b) CommScope shall, and shall cause its Representatives to,
promptly, but no later than five Business Days after the date of such
termination, deliver to Furukawa all Transaction Information in the
possession of, or that has been furnished to, CommScope or any of its
Representatives, and will not retain any copies, extracts or other
reproductions in whole or in part of such Transaction Information.
ARTICLE XI
GENERAL PROVISIONS
Section 11.1. Expenses. Following the Closing, Furukawa shall
cause the Cable JV to reimburse CommScope or Furukawa, as applicable, for
the Reimbursable Expenses indicated on such party's Statement. CommScope or
Furukawa, as applicable, shall represent and warrant to the Buyer Entities
that each expense (including the nature and amount of such expense) set
forth on such party's Statement is a Reimbursable Expense as defined
herein. The Cable JV and its representatives and agents shall have the
right to review and perform an audit of the Statement (and CommScope or
Furukawa, as applicable, shall cooperate and cause its representatives and
agents (including its accountants and auditors) to cooperate in such
audit), the reasonable cost and expense of which shall be reimbursed by
CommScope or Furukawa, as
-17-
applicable, in the event that the amount of Reimbursable Expenses reflected
on such Statement were overstated by more than 5%.
Section 11.2. Assignment. This Agreement may not be assigned by
any party hereto without the other party's consent; provided, however, that
each party hereto shall have the right to assign this Agreement and to
assign its rights and delegate its duties under this Agreement, either in
whole or in part, at any time upon notice to the other party and without
the other party's consent, to (a) any present or future direct or indirect
wholly-owned Subsidiary of such assigning party or (b) any person to whom
such party has transferred all of its Membership Interests in the Cable JV
(as defined by the Amended LLC Agreement) in accordance with Article VI of
the Amended LLC Agreement (provided that following any assignment pursuant
to this clause (b) to any person other than a present or future direct or
indirect wholly-owned Subsidiary of such assigning party, Section 4.2
hereof shall become void and have no effect). Notwithstanding the
foregoing, such assignment or delegation shall not release such assigning
party from any of its obligations or liabilities under this Agreement.
Section 11.3. Governing Law. This Agreement shall be governed in
accordance with the laws of the State of New York irrespective of the
choice of laws principles of the State of New York.
Section 11.4. Entire Agreement. This Agreement, the Framework
Agreement, the Financing Agreement and the Confidentiality Agreement
constitute the entire agreement and supersede all prior agreements and
understandings, both written and oral, between the parties with respect to
the subject matter hereof, including without limitation the MOU which is
amended and restated in its entirety by this Agreement.
Section 11.5. Counterparts. This Agreement may be executed in one
or more counterparts, and by facsimile, and by the different parties hereto
in separate counterparts, each of which when executed shall be deemed to be
an original but all of which taken together shall constitute one and the
same agreement.
Section 11.6. Amendment. This Agreement may not be amended or
modified except by an instrument in writing signed by each of Furukawa and
CommScope.
Section 11.7. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their successors and permitted assigns.
Section 11.8. Notices. All notices and other communications
hereunder shall be in writing and shall be delivered by hand, telecopy,
facsimile or next-day courier service and shall be deemed given when
delivered. All notices hereunder shall be delivered as set forth below, or
pursuant to such other instructions as may be designated in writing by the
party to receive such notice:
If to Furukawa, to: The Furukawa Electric Co., Ltd.
6-1, Marunouchi 2-chome
Chiyoda-Ku
Tokyo 100-8322
-18-
Attention: Mr. Koichi Nakamura
Facsimile: 011-81-3-3286-3919
With a copy to: Masuda & Ejiri
399 Park Avenue, 18th Floor
New York, New York 10022
Attention: Junji Masuda
Facsimile: (212) 486-2614
With a copy to: Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Eric S. Robinson
David C. Karp
Facsimile: (212) 403-2000
If to CommScope, to: CommScope, Inc.
Lenoir-Rhyne Boulevard, SE
Hickory, North Carolina 28603-0339
Attention: Frank B. Wyatt, II
Facsimile: (828) 431-2520
With a copy to: Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, New York 10004
Attention: Christopher Ewan
Facsimile: (212) 859-8588
Section 11.9. Third Party Beneficiaries. This Agreement shall not
provide any Person other than Furukawa or CommScope with any remedy, claim,
liability, reimbursement, cause of action or other right in excess of those
existing without reference to the terms of this Agreement; provided that,
notwithstanding the foregoing, Furukawa and CommScope intend, and hereby
expressly agree, that each of CommScope's and Furukawa's Subsidiaries shall
be a third party beneficiary of this Agreement and shall have the right to
enforce CommScope's and Furukawa's respective rights hereunder in
accordance with the terms hereof.
Section 11.10. Survival. It is the express intention and
agreement of CommScope and Furukawa that this Agreement shall survive the
Closing.
Section 11.11. Consent to Jurisdiction. Each of Furukawa and
CommScope irrevocably submits, and agrees to cause their Subsidiaries and
Affiliates to irrevocably submit to, the exclusive jurisdiction of the
United States District Court for the Southern District of New York, for the
purposes of any suit, action or other proceeding arising out of this
Agreement or any transaction contemplated hereby (and each agrees that no
such action, suit or proceeding relating to this Agreement or any
transaction contemplated hereby shall be brought by it or any of its
Subsidiaries or Affiliates except in such court). Each of Furukawa and
CommScope further agrees, and agrees to cause their Subsidiaries and
Affiliates to agree, that service of any
-19-
process, summons, notice or document by U.S. registered mail to such
person's respective address set forth above shall be effective service of
process for any action, suit or proceeding in New York with respect to any
matters to which it has submitted to jurisdiction as set forth above in the
immediately preceding sentence. Each of Furukawa and CommScope irrevocably
and unconditionally waives (and agrees not to plead or claim), and agrees
to cause its Subsidiaries and Affiliates to irrevocably and unconditionally
waive (and not to plead or claim), any objection to the laying of venue of
any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in the United States District Court for
the Southern District of New York or that any such action, suit or
proceeding brought in any such court has been brought in an inconvenient
forum.
Section 11.12. Waiver of Jury Trial. Each of Furukawa and
CommScope hereby waives, and agrees to cause each of its Subsidiaries and
Affiliates to waive, to the fullest extent permitted by applicable law, any
right it may have to a trial by jury in respect of any litigation directly
or indirectly arising out of, under or in connection with this Agreement.
Each of Furukawa and CommScope (a) certifies that no representative of any
other party has represented, expressly or otherwise, that such other party
would not, in the event of litigation, seek to enforce the foregoing waiver
and (b) acknowledges that it and the other parties hereto have been induced
to enter into this Agreement by, among other things, the mutual waivers and
certifications in this Section 11.12.
-20-
IN WITNESS WHEREOF, Furukawa and CommScope have caused this
Agreement to be duly executed and delivered on their behalf by their duly
authorized representative, intending to be legally bound hereby, as of the
day and year first written above.
THE FURUKAWA ELECTRIC CO., LTD.
By: /s/ Katsuhiko Okubo
--------------------------------
Name: Katsuhiko Okubo
Title: Senior Managing Director
COMMSCOPE, INC.
By: /s/ Frank M. Drendel
--------------------------------
Name: Frank M. Drendel
Title: Chief Executive Officer
-21-