-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, A1uI9tUJmi7BLC1F+mrF6o39MOdxJrq5k/qIkaIYUhte5slkKtyqrwc2mBJYW4zD ewBdkzdpRfYJn478Ejd+4Q== 0000895345-99-000176.txt : 19990406 0000895345-99-000176.hdr.sgml : 19990406 ACCESSION NUMBER: 0000895345-99-000176 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19990405 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: GENERAL INSTRUMENT CORP CENTRAL INDEX KEY: 0001035881 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 364134221 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-51341 FILM NUMBER: 99587598 BUSINESS ADDRESS: STREET 1: 101 TOURNAMENT DRIVE CITY: HORSHAM STATE: PA ZIP: 19044 BUSINESS PHONE: 2153231000 MAIL ADDRESS: STREET 1: 101 TOURNAMENT DRIVE CITY: HORSHAM STATE: PA ZIP: 19044 FORMER COMPANY: FORMER CONFORMED NAME: NEXTLEVEL SYSTEMS INC DATE OF NAME CHANGE: 19970314 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: FORSTMANN LITTLE & CO SUB DEBT & EQU MGMT BYOUT PART IV/INST CENTRAL INDEX KEY: 0000903004 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O FORSTMANN LITTLE & CO STREET 2: 767 FIFTH AVE CITY: NEW YORK STATE: NY ZIP: 10153 MAIL ADDRESS: STREET 1: FRIED FRANK HARRIS SHRIVER & JACOBSON STREET 2: ONE NEW YORK PLAZA CITY: NEW YORK STATE: NY ZIP: 10004 SC 13D/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 -------------- SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 4)* General Instrument Corporation (formerly NextLevel Systems, Inc.) - ------------------------------------------------------------------------------- (Name of Issuer) Common Stock, par value $0.01 per share - ------------------------------------------------------------------------------- (Title of Class of Securities) 370120107 ---------------------------------------------- (CUSIP Number) Fried, Frank, Harris, Shriver & Jacobson Forstmann Little & Co. Subordinated One New York Plaza Debt and Equity Management Buyout New York, NY 10004 Partnership-IV Attn: Aviva Diamant, Esq. Instrument Partners (212) 859-8000 c/o Forstmann Little & Co. 767 Fifth Avenue New York, NY 10153 Attn: Steven B. Klinsky (212) 355-5656 - ------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) April 5, 1999 --------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [ ]. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (Continued on following pages) - -------------- *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). SCHEDULE 13D CUSIP No. 370120107 Page 2 of 8 Pages 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) FORSTMANN LITTLE & CO. SUBORDINATED DEBT AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [X] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION NEW YORK NUMBER OF 7 SOLE VOTING POWER SHARES 1,001,092 BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH 0 REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH 1,001,092 10 SHARED DISPOSITIVE POWER 0 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,001,092 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ] EXCLUDES CERTAIN SHARES* 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.58% 14 TYPE OF REPORTING PERSON* PN *SEE INSTRUCTIONS BEFORE FILLING OUT! SCHEDULE 13D CUSIP No. 370120107 Page 3 of 8 Pages 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY) INSTRUMENT PARTNERS 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [X] 3 SEC USE ONLY 4 SOURCE OF FUNDS* 00 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION NEW YORK NUMBER OF 7 SOLE VOTING POWER SHARES 1,137,573 BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH 0 REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH 1,137,573 10 SHARED DISPOSITIVE POWER 0 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,137,573 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ] EXCLUDES CERTAIN SHARES* 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) .66% 14 TYPE OF REPORTING PERSON* PN *SEE INSTRUCTIONS BEFORE FILLING OUT! This Amendment No. 4 amends and supplements the Statement on Schedule 13D (the "Schedule 13D") relating to the common stock, par value $.01 per share (the "Common Stock"), of General Instrument Corporation, a Delaware corporation (the "Company"), previously filed by Instrument Partners, a New York limited partnership, and Forstmann Little & Co. Subordinated Debt and Equity Management Buyout Partnership-IV ("MBO-IV"; together with Instrument Partners, the "Partnerships"), a New York limited partnership. Capitalized terms used and not defined in this Amendment have the meanings set forth in the Schedule 13D. Except as specifically provided herein, this Amendment does not modify any of the information previously reported on the Schedule 13D. ITEM 4. Purpose of the Transaction -------------------------- Item 4 is hereby amended and supplemented as follows: On April 5, 1999, Instrument Partners and MBO-IV sold 2,819,111 shares and 2,480,889 shares, respectively, of Common Stock to the Company at a purchase price of $28.00 per share (the "Company Sales"). The agreement pursuant to which such sales took place (the "Company Agreement") is filed as Exhibit 4 to this Schedule 13D and incorporated herein by reference. On April 5, 1999, Instrument Partners and MBO-IV sold 5,319,078 shares and 4,680,922 shares, respectively, of Common Stock to Liberty Media Corporation, a Delaware corporation ("Liberty Media"), at a purchase price of $28.00 per share (the "Liberty Sales"). The agreement pursuant to which such sales took place (the "Liberty Agreement") is filed as Exhibit 5 to this Schedule 13D and incorporated herein by reference. On April 5, 1999, Instrument Partners and MBO-IV sold 2,271,246 shares and 1,998,754 shares, respectively, of Common Stock to Goldman, Sachs & Co. ("Goldman Sachs"), at a purchase price of $28.25 per share, in transactions pursuant to Rule 144 under the Securities Act of 1933 (the "Goldman Sachs Sales"). Effective April 5, 1999, Theodore J. Forstmann, a general partner of the general partner of each of the Partnerships, resigned from the Board of Directors of the Company. On April 5, 1999, the Partnerships delivered a letter to the Company requesting the Company to apply to the Securities and Exchange Commission for withdrawal of the Registration Statement filed on August 26, 1998. Subject to compliance with the Liberty Media Agreement (see item 6 below), the Partnerships plan to dispose of the remainder of their holdings of Common Stock through open market transactions, block trades, privately negotiated transactions, or otherwise. ITEM 5. Interest in Securities of the Issuer ------------------------------------ Item 5 is hereby amended and supplemented as follows: (i) Instrument Partners: (a) Amount Beneficially Owned: Instrument Partners owns 1,137,573 shares of Common Stock, representing approximately .66% of the Common Stock as of April 5, 1999. (b) Number of shares as to which such person has: (i) sole power to vote or to direct the vote -- 1,137,573. (ii) shared power to vote or to direct the vote - none. (iii) sole power to dispose or to direct the disposition of -- 1,137,573. (iv) shared power to dispose or to direct the disposition of - none. (ii) MBO-IV: (a) Amount Beneficially Owned: MBO-IV owns 1,001,092 shares of Common Stock, representing approximately .58% of the Common Stock as of April 5, 1999. As a result of the merger of FLC Partnership, L.P. with and into FLC XXIX Partnership, L.P., a New York limited partnership ("FLC XXIX"), FLC XXIX is the general partner of MBO-IV and, accordingly, may be deemed to share beneficial ownership of the shares of Common Stock owned by MBO-IV, but specifically disclaims any such beneficial ownership pursuant to Rule 13d-4. Theodore J. Forstmann, Nicholas C. Forstmann, Steven B. Klinsky, Winston W. Hutchins, Sandra J. Horbach, Thomas H. Lister, and Tywana LLC, a North Carolina limited liability company, are the general partners of FLC XXIX. Pursuant to the FLC XXIX Partnership Agreement, however, Ms. Horbach, Mr. Lister and Tywana LLC have no economic, voting, dispositive or other beneficial ownership of any shares of Common Stock of the Company owned by MBO-IV. Each of Messrs. Theodore J. Forstmann, Nicholas C. Forstmann, Steven B. Klinsky and Winston W. Hutchins may be deemed to share beneficial ownership of the shares of Common Stock owned by MBO-IV, but specifically disclaim any such beneficial ownership pursuant to Rule 13d-4. (b) Number of shares as to which such person has: (i) sole power to vote or to direct the vote -- 1,001,092. (ii) shared power to vote or to direct the vote - none. (iii) sole power to dispose or to direct the disposition of -- 1,001,092. (iv) shared power to dispose or to direct the disposition of - none. (iii) In the past sixty days, the Partnerships sold a total of 19,570,000 shares in the following transactions: Reporting Person Date Number of Shares Price per Share ---------------- ---- ---------------- --------------- Instrument Partners 4/5/99 2,819,111 $28.00(1) MBO-IV 4/5/99 2,480,889 $28.00(1) Instrument Partners 4/5/99 5,319,078 $28.00(2) MBO-IV 4/5/99 4,680,922 $28.00(2) Instrument Partners 4/5/99 2,271,246 $28.25(3) MBO-IV 4/5/99 1,998,754 $28.25(3) (1) Pursuant to the Company Agreement. (2) Pursuant to the Liberty Agreement. (3) Sold to Goldman Sachs pursuant to Rule 144 under the Securities Act. (iv) On April 5, 1999, each of Investment Partners and MBO-IV ceased to be the beneficial owner of more than five percent to the shares of Common Stock of the Company. ITEM 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer. ------------------------------------------------------------- Item 6 is hereby amended and supplemented as follows: Pursuant to the Company Agreement, the Partnerships executed and delivered to the Company irrevocable proxies to vote at the Company's 1999 annual meeting of stockholders 9.57 million of the shares of Common Stock held by the Partnerships on March 31, 1999, the record date for such annual meeting. Pursuant to the Liberty Agreement, (A) the Partnerships executed and delivered irrevocable proxies granting Liberty Media the right to vote the 10 million shares of Common Stock purchased by it from the Partnerships at the Company's 1999 annual meeting of stockholders, (B) the Partnerships assigned to Liberty Media certain of their rights and obligations under the Registration Rights Agreement, dated as of April 6, 1992, among MBO-IV, Instrument Partners, General Instrument Corporation, a Delaware corporation (the former parent of the Company), and GI Corporation, a Delaware corporation, and the Letter Agreement, dated July 25, 1997, between the Company, MBO-IV and Instrument Partners, (C) the Partnerships agreed that until July 5, 1999, the Partnerships would not sell any shares of Company Common Stock except for the Company Sales, the Liberty Sales and the Goldman Sachs Sales (collectively, the "Sales") and except for Block Sale Transactions (as defined below), and (D) Liberty Media waived its right of first refusal with respect to (i) each of the Sales, (ii) Block Sale Transactions taking place prior to July 5, 1999, and (iii) sales in broker transactions or to a market maker taking place on or after July 5, 1999 at a price per share of at least $28.00. In addition, Liberty Media modified its right of first refusal with respect to sales by the Partnerships in the open market at prices of less than $28.00 per share. A Block Sale Transaction is defined in the Liberty Agreement as any sale by the Partnerships of not less than 200,000 shares of Common Stock in one transaction or a series of transactions taking place on a single trading day (a) pursuant to a sell order placed with a single brokerage firm, (b) to a single market-maker, or (c) to any institutional investor, in each case, at a price per share of not less than $28.00. Any descriptions of contracts, arrangements, understandings or relationships with respect to securities of the Company contained herein are not intended to be complete, and are qualified in their entirety by the complete text of the agreement. The Company Agreement and the Liberty Agreement are filed as Exhibits 4 and 5 hereto, respectively, and are incorporated herein by reference. ITEM 7. Material to be Filed as Exhibits. -------------------------------- Item 7 is hereby amended and supplemented as follows: 4. Agreement, dated as of April 2, 1999, among MBO-IV, Instrument Partners and the Company. 5. Agreement, dated as of April 2, 1999, among MBO-IV, Instrument Partners and Liberty Media. SIGNATURE --------- After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: April 5, 1999 INSTRUMENT PARTNERS By: FLC XXII Partnership, its general partner By: /s/ Steven B. Klinsky --------------------- Steven B. Klinsky, a general partner FORTSMANN LITTLE & CO. SUBORDINATED DEBT AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV By: FLC XXIX Partnership, L.P., its general partner By: /s/ Steven B. Klinsky ---------------------- Steven B. Klinsky, a general partner EX-99.1 2 Exhibit 4 STOCK DISPOSITION AGREEMENT Stock Disposition Agreement, dated as of April 2, 1999 (this "Agreement"), among General Instrument Corporation, a Delaware corporation (the "Company"), Instrument Partners, a New York limited partnership ("Instrument Partners"), and Forstmann Little & Co. Subordinated Debt and Equity Management Buyout Partnership-IV, a New York limited partnership ("MBO-IV"; and together with Instrument Partners, the "Selling Stockholders"). WHEREAS, Instrument Partners is the owner of 11,547,008 shares of the Company's common stock, par value $.01 per share (the "Common Stock"), and MBO-IV is the owner of 10,161,657 shares of Common Stock; and WHEREAS, the Company desires to purchase from Instrument Partners, and Instrument Partners desires to sell to the Company, 2,819,111 of its shares of Common Stock; and the Company desires to purchase from MBO-IV, and MBO-IV desires to sell to the Company, 2,480,889 of its shares of Common Stock (such Instrument Partners and MBO-IV shares of Common Stock, the "Shares"); and WHEREAS, contemporaneously with the execution and delivery of this Agreement, the Selling Stockholders are entering into an agreement (the "Other Agreement") to sell 10 million of their other shares of Common Stock to Liberty Media Corporation, a Delaware corporation ("Liberty Media"). NOW, THEREFORE, in consideration of the mutual covenants and undertakings contained herein, and on the terms and subject to the conditions set forth herein, the parties hereto, each representing to the others that its execution, delivery and performance of this Agreement has been fully and duly authorized, agree as follows: SECTION 1 - DEFINITIONS ----------------------- 1.1 SPECIFIC DEFINITIOS. As used in this Agreement, the following terms shall have the meanings set forth below: "Business Day" - any day other than a Saturday, a Sunday or a day on which banks in New York City are authorized or obligated by law or executive order to close. "Closing" - the closing of the purchase and sale of the Shares. "Closing Date" - the date on which the Closing occurs. "Governmental Entity" - any federal, state or local judicial, legislative, executive or regulatory authority. Other terms are defined elsewhere in this Agreement and, unless otherwise indicated, shall have such meanings throughout this Agreement. SECTION 2 - PURCHASE AND SALE ----------------------------- 2.1 PURCHASE AND SALE OF SHARES. On the terms and subject to the conditions, and in reliance on the representations and warranties, set forth herein, at the Closing the Selling Stockholders shall sell and transfer to the Company, and the Company shall purchase from the Selling Stockholders, the Selling Stockholders' Shares (2,819,111 Shares in the case of Instrument Partners, and 2,480,889 Shares in the case of MBO-IV), at a cash purchase price equal to $28.00 per Share (the "Purchase Price"). The aggregate Purchase Price is $148,400,000. 2.2 CLOSING; DELIVERY AND PAYMENT. (a) The Closing shall take place at the offices of Fried, Frank, Harris, Shriver & Jacobson, One New York Plaza, New York, New York, or at such other place as the Selling Stockholders and the Company shall agree, at 9:00 a.m. (eastern standard time) on April 5, 1999 (provided that the conditions set forth in Sections 4.1(c), 4.1(d)(i), 4.2(c) and 4.2(e)(i) hereof shall have been satisfied) or as soon thereafter as practicable after such conditions have been satisfied. (b) On the Closing Date, each of the Selling Stockholders shall deliver to the Company such instruments of transfer, in form and substance reasonably satisfactory to the Company, as shall be sufficient to transfer its Shares to the Company, and in exchange therefor (and upon receipt of confirmation from the Company's transfer agent of its receipt of the instruments of transfer to be delivered to it) the Company shall pay to each of the Selling Stockholders the aggregate Purchase Price for the Shares sold by such Selling Stockholders in immediately available funds to the accounts designated by such Selling Stockholders. SECTION 3 - REPRESENTATIONS AND WARRANTIES ------------------------------------------ 3.1 BY THE PARTIES. Instrument Partners and MBO-IV each represents and warrants to the Company, and the Company represents and warrants to Instrument Partners and MBO-IV, as follows: (a) It has all necessary authority for the execution, delivery and performance of this Agreement by it; it has duly executed and delivered this Agreement; and this Agreement is a valid and legally binding agreement, enforceable against it in accordance with its terms, assuming the due execution and delivery by the other parties; and (b) The performance of this Agreement by it will not violate or conflict with any law, regulation, order or agreement, or, to the extent applicable, such party's charter or organic documents, and such party is not required to obtain any governmental approvals or third party consents to enter into and perform its obligations pursuant to this Agreement. Such execution and performance does not and will not constitute a default under any agreement or obligation binding on it or result in the forfeiture or loss of any rights or assets by it except as specifically provided for in this Agreement. 3.2 BY THE SELLING STOCKHOLDERS. Each of the Selling Stockholders represents and warrants to the Company that (a) it is the owner of 11,547,008 shares of Common Stock (in the case of Instrument Partners) and 10,161,657 shares of Common Stock (in the case of MBO-IV), (b) the Shares to be sold hereunder by it are owned, and will at the Closing be conveyed to the Company, by such Selling Stockholder free and clear of any liens, charges or encumbrances and (c) upon delivery of its Shares, and payment therefor pursuant hereto, good and valid title to its Shares will pass to the Company (assuming that the Company is without notice of any adverse claim, as defined in the Uniform Commercial Code as adopted in the State of New York (the "Code") and is otherwise a bona fide purchaser for the purposes of the Code). 3.3 NO OTHER WARRANTIES. Except as expressly set forth in this Agreement, no party is relying on any express or implied representations or warranties relating to any party or to the consummation of the transactions contemplated hereby. Except as and to the extent expressly set forth in this Agreement, each party hereto hereby disclaims all liability and responsibility for any statement or information made or communicated (orally or in writing) to any other party hereto or any affiliate, representative or agent thereof (including without limitation any opinion, information or advice by any officer, director, consultant, affiliate, representative or agent of the disclaiming party). SECTION 4 - CONDITIONS TO THE PARTIES' OBLIGATIONS TO CLOSE ----------------------------------------------------------- 4.1 CONDITIONS TO THE OBLIGATIONS OF INSTRUMENT PARTNERS AND MBO-IV TO CLOSE. The obligations of Instrument Partners and MBO-IV to consummate the transactions contemplated by this Agreement are subject to the satisfaction (or waiver) of the following conditions: (a) No Injunctions. There shall not be in effect any statute, regulation, order, decree or judgment of any Governmental Entity that makes illegal or enjoins or prevents in any material respect the consummation of the transactions contemplated by this Agreement. (b) Representations. All representations made by the Company in Article III hereof shall be true and correct in all material respects at and as of the Closing Date. (c) Liberty Media Right of First Refusal. Liberty Media (as assignee of TCI Ventures Group, LLC), shall have waived in writing its rights of first refusal, with respect to the transactions contemplated by this Agreement, under the letter agreement, dated August 1, 1998 (the "Letter Agreement"), among TCI Ventures Group, LLC, Instrument Partners, MBO-IV, the Company and the other party thereto, and the Selling Stockholders shall have received a copy of such written waiver. (d) Other Agreement. (i) All conditions to the consummation of the transactions contemplated by the Other Agreement shall have been satisfied or waived and the parties thereto shall be fully prepared to consummate the transactions contemplated thereby; and (ii) the transactions contemplated by the Other Agreement shall have been consummated contemporaneously with the consummation of the transactions contemplated by this Agreement. 4.2 CONDITIONS TO THE OBLIGATIONS OF THE COMPANY TO CLOSE. The obligations of the Company to consummate the transactions contemplated by this Agreement are subject to the satisfaction (or waiver) of the following conditions: (a) No Injunctions. There shall not be in effect any statute, regulation, order, decree or judgment of any Governmental Entity that makes illegal or enjoins or prevents in any material respect the consummation of the transactions contemplated by this Agreement. (b) Representations. All representations made by Instrument Partners and MBO-IV in Article III hereof shall be true and correct in all material respects at and as of the Closing Date. (c) Liberty Media Right of First Refusal. Liberty Media (as assignee of TCI Ventures Group, LLC), shall have waived in writing its rights of first refusal, with respect to the transactions contemplated by this Agreement, under the Letter Agreement, and the Company shall have received a copy of such written waiver. (d) Fairness Opinion. The opinion previously delivered to the board of directors of the Company by Merrill Lynch & Co., that the Purchase Price is fair to the Company from a financial point of view, shall not have been withdrawn or adversely modified. (e) Other Agreement. (i) All conditions to the consummation of the transactions contemplated by the Other Agreement shall have been satisfied or waived and the parties thereto shall be fully prepared to consummate the transactions contemplated thereby; and (ii) the transactions contemplated by the Other Agreement shall have been consummated contemporaneously with the consummation of the transactions contemplated by this Agreement. (f) Rule 144 Sale. Instrument Partners or MBO-IV shall have entered into an arrangement with Goldman Sachs & Co. to sell at least 4 million of their shares of Common Stock (other than the Shares and the shares subject to the Other Agreement) under Rule 144 of the Securities Act of 1933, as amended, and the Company shall have received evidence of such arrangement reasonably satisfactory to it. (g) Forstmann Resignation. Theodore J. Forstmann shall have resigned his position as a Director of the Company. (h) Proxy. Instrument Partners and MBO-IV shall have executed and delivered to the Company an irrevocable proxy (in the form of Exhibit A hereto) to vote 9.57 million of the shares of Common Stock held by them on March 31, 1999, the record date for the Company's 1999 annual meeting of stockholders, at such annual meeting . SECTION 5 - TERMINATION ----------------------- 5.1 TERMINATION. This Agreement may be terminated at any time prior to the Closing: (a) by written agreement of the Selling Stockholders and the Company; (b) either by the Selling Stockholders or by the Company, by written notice of such termination to the other, if the Closing shall not have been consummated on or prior to 2:00 p.m. eastern standard time (in the case of a termination by the Selling Stockholders), or on or prior to 5:00 p.m. eastern standard time (in the case of a termination by the Company), on April 5, 1999; (c) either by the Selling Stockholders or by the Company if any court of competent jurisdiction or other competent Governmental Entity shall have by statute, rule, regulation, order, decree or injunction or other action permanently restrained, enjoined or otherwise prohibited any of the transactions contemplated by this Agreement. SECTION 6 - MISCELLANEOUS ------------------------- 6.1 NOTICES. All notices or other communications hereunder shall be deemed to have been duly given and made if in writing and if served by personal delivery upon the party for whom it is intended, if delivered registered or certified mail, return receipt requested, or by a national courier service, if sent by facsimile transmission, provided that the facsimile transmission is promptly confirmed by telephone confirmation thereof, or on the third day after posting in the United States postage prepaid if sent by registered or certified mail, return receipt requested, to the person at the address set forth below, or such other address as may be designated in writing hereafter, in the same manner, by such person: To the Company: General Instrument Corporation 101 Tournament Drive Horsham, Pennsylvania 19044 Attention: Robert A. Scott, Esq. Senior Vice President, General Counsel and Secretary Tel: (215) 323-1000 Fax: (215) 323-1293 To Instrument Partners or MBO-IV: c/o Forstmann Little & Co. 767 Fifth Avenue New York, New York 10153 Attention: Winston W. Hutchins Tel: (212) 355-5656 Fax: (212) 759-9059 6.2 AMENDMENT; WAIVER. Any provision of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of any amendment, by the parties hereto, or in the case of a waiver, by the party against whom the waiver is to be effective. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and, except as otherwise provided herein, shall not be exclusive of any rights or remedies provided by law. 6.3 ASSIGNMENT. No party to this Agreement may assign any of its rights or obligations under this Agreement without the consent of the other parties hereto. 6.4 ENTIRE AGREEMENT. This Agreement (which includes the Exhibit hereto) contains the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral or written, between or among them with respect to such matters, and any written agreement of the parties that expressly provides that it is not superseded by this Agreement. 6.5 PARTIES IN INTEREST. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. Nothing in this Agreement, express or implied, is intended to confer upon any person other than the parties hereto, and their successors or permitted assigns, any rights or remedies under or by reason of this Agreement. 6.6 GOVERNING LAW: SUBMISSION TO JURISDICTION; SELECTION OF FORUM. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. Each party hereto agrees that it shall bring any action or proceeding in respect of any claim arising out of or related to this Agreement or the transactions contained in or contemplated by this Agreement, whether in tort or contract or at law or in equity, exclusively in the United States District Court for the Southern District of New York or the Supreme Court of the state of New York for the County of New York, and solely in connection with claims arising under this Agreement or the transactions contained in or contemplated by this Agreement (i) irrevocably submits to the exclusive jurisdiction of such courts, (ii) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over any party hereto and (iii) agrees that service of process upon such party in any such action or proceeding shall be effective if notice is given in accordance with Section 6.1 of this Agreement. 6.7 COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same Agreement. 6.8 FURTHER ASSURANCES. Each party hereto shall (at its expense) take such actions and execute and deliver such other documents, certifications and further assurances as the other parties hereto may reasonably request in order to carry out the purposes of this Agreement. IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first written above. GENERAL INSTRUMENT CORPORATION By:/s/ Robert A. Scott ------------------------------------ Name: Robert A. Scott Title: Senior Vice President, General Counsel & Secretary INSTRUMENT PARTNERS By: FLC XXII Partnership, general partner By:/s/ Steven B. Klinsky -------------------------------- Name: Steven B. Klinsky Title: General Partner FORSTMANN LITTLE & CO. SUBORDINATED DEBT AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV By: FLC XXIX Partnership, L.P., general partner By:/s/ Steven B. Klinsky -------------------------------- Name: Steven B. Klinsky Title: General Partner Exhibit A IRREVOCABLE PROXY FOR THE 1999 ANNUAL MEETING OF STOCKHOLDERS OF GENERAL INSTRUMENT CORPORATION ----------------------------------- April __, 1999 The undersigned hereby irrevocably appoint Geoffrey S. Roman and Richard C. Smith and each or either of them their attorneys and agents, with full power of substitution, to vote as Proxy for the undersigned as herein stated at the 1999 Annual Meeting of Stockholders of General Instrument Corporation (the "Company"), and at any adjournments thereof, according to the number of votes the undersigned would be entitled to vote with respect to 9.57 million of their shares of common stock of the Company (comprised of 5,090,357 of Instrument Partners' shares, and 4,479,643 of Forstmann Little & Co. Subordinated Debt and Equity Management Buyout Partnership-IV's shares) if personally present on the matters set forth below and in accordance with their discretion on any other matters that may properly come before the meeting or any adjournments thereof. FOR election as Class II directors of the nominees recommended by the Board of Directors of the Company. FOR any proposal to approve the Company's 1999 Long-Term Incentive Plan. FOR ratification of the appointment by the Board of Directors of the Company of Deloitte & Touche LLP as independent auditor for the Company for the 1999 fiscal year. This proxy is coupled with an interest and is irrevocable. FORSTMANN LITTLE & CO. SUBORDINATED DEBT INSTRUMENT PARTNERS AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV By: FLC XXII Partnership, By: FLC XXIX Partnership, L.P., general partner general partner By: By: ------------------------- ----------------------------- Name: Name: Title: General Partner Title: General Partner EX-99.2 3 Exhibit 5 STOCK PURCHASE AGREEMENT ------------------------ STOCK PURCHASE AGREEMENT, dated as of April 2, 1999, among Forstmann Little & Co. Subordinated Debt and Equity Management Buyout Partnership-IV, a New York limited partnership ("MBO-IV"), Instrument Partners, a New York limited partnership ("IP" and collectively with MBO-IV, "FLC"), and Liberty Media Corporation, a Delaware corporation ("Liberty"). RECITALS WHEREAS, MBO-IV is the owner of 10,161,657 shares of the common stock, par value $0.01 per share (the "Company Common Stock"), of General Instrument Corporation, a Delaware corporation (the "Company"), and IP is the owner of 11,547,008 shares of Company Common Stock; WHEREAS, MBO-IV and IP desire to sell, and Liberty desires to purchase, an aggregate of ten million (10,000,000) shares of Company Common Stock (comprised of 5,319,078 shares from IP and 4,680,922 shares from MBO-IV) at a price per share of $28.00, all subject to the terms and conditions set forth herein; and WHEREAS, contemporaneously with the execution and delivery of this Agreement, MBO-IV and IP are entering into an agreement with the Company (the "Company Purchase Agreement") to sell to the Company an aggregate of five million three hundred thousand (5,300,000) shares of Company Common Stock. AGREEMENT NOW, THEREFORE, for and in consideration of the mutual promises set forth herein, and upon the terms and subject to the conditions hereof, the parties hereto, intending to be legally bound, agree as follows: 1. PURCHASE AND SALE (a) Purchase Price, Payment. (i) Subject to the terms and conditions contained herein, FLC hereby agrees to sell, transfer and assign to Liberty and Liberty hereby agrees to purchase, acquire and accept from FLC, ten million (10,000,000) shares of Company Common Stock (the "Purchased Shares"). The aggregate purchase price for the Purchased Shares will be $280,000,000 (the "Purchase Price"). The number of Purchased Shares shall be appropriately adjusted to reflect the effects of any stock split, reverse split, stock dividend or other reclassification or reorganization affecting the capital stock of the Company, the record date for which occurs on or after the date hereof and prior to the Closing (as defined below). (ii) The closing of the purchase and sale of the Purchased Shares (the "Closing") shall be held at the offices of Fried, Frank, Harris Shriver & Jacobson, One New York Plaza, New York, New York, or at such other place as FLC and Liberty may mutually agree, at 9:00 a.m. (New York City time), on April 5, 1999 or as soon thereafter as practicable after all conditions to Closing have been satisfied or waived. (The date on which the Closing occurs is referred to as the "Closing Date".) (iii) On the Closing Date, each of MBO-IV and IP shall deliver to Liberty such instruments of transfer, in form and substance reasonably satisfactory to Liberty, as shall be sufficient to transfer the Purchased Shares to Liberty, and in exchange therefor (and upon receipt of confirmation from the Transfer Agent (as defined below) of its receipt of the instruments of transfer to be delivered to it) Liberty shall pay to MBO-IV and IP by wire transfer of immediately available funds to the respective accounts previously designated by MBO-IV and IP the aggregate Purchase Price. (b) Representations of FLC. Each of MBO-IV and IP represents and warrants to Liberty that: (i) It is a duly organized limited partnership, validly existing and in good standing under the laws of the State of New York. (ii) It has all necessary power and authority to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby; the execution and delivery of this Agreement by it and the consummation by it of the transactions contemplated hereby have been duly and validly authorized by all necessary partnership action, and no other proceedings on its part are necessary to authorize the execution and delivery of this Agreement by it or to consummate the transactions contemplated hereby. (iii) It is the owner of 10,161,657 shares of Company Common Stock (in the case of MBO-IV) and 11,547,008 shares of Company Common Stock (in the case of IP). (iv) Except for Liberty's rights under the Letter Agreement (as defined below), MBO-IV and IP own the Purchased Shares free and clear of all security interests, claims, liens and encumbrances of any nature, including, but not limited to, any rights of third parties in or to the Purchased Shares. (v) This Agreement has been duly and validly executed and delivered by it and, assuming the due execution and delivery hereof by Liberty, this Agreement is its valid and binding obligation, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting the rights of creditors generally and by general principles of equity. (vi) Immediately after the sale, transfer and assignment thereof at the Closing, Liberty will have good title to the Purchased Shares free and clear of all security interests, claims, liens and encumbrances of any nature (other than any arising pursuant to this Agreement or under state or federal securities laws or created by Liberty). (vii) Each of the Registration Rights Agreement, dated as of April 6, 1992, among MBO-IV, IP, General Instrument Corporation, a Delaware corporation (the former parent company of the Company), and GI Corporation, a Delaware corporation, and the letter agreement dated July 25, 1997 between the Company, MBO-IV and IP (the "Registration Rights Agreement"), has been duly executed and delivered by MBO-IV and IP, and is a valid and binding obligation of each such party, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting the rights of creditors generally and by general principles of equity. (viii) The assignment by MBO-IV and IP of certain of their rights, benefits and obligations under the Registration Rights Agreement pursuant to Section 2 hereof will vest in Liberty such rights, benefits and obligations under the Registration Rights Agreement as are specified herein. (ix) Other than pursuant to this Agreement, the Letter Agreement, the Company Purchase Agreement and the Rule 144 Sale Arrangements (as defined below), (A) it has no legal obligation, absolute or contingent to sell shares of Company Common Stock to any person, and (B) no third party holds any option, warrant or other right to acquire shares of Company Common Stock from it. (x) There is no action, suit, investigation or proceeding, governmental or otherwise, pending or, to the best of its knowledge threatened, against it specifically relating to the transactions contemplated by this Agreement, nor is there any basis therefor known to it. (xi) Assuming that the Purchased Shares are sold to Liberty in a transaction exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"), and from qualification or registration under applicable state securities laws, (i) no consent, approval or authorization of, nor any registration, qualification or filing with, any governmental agency or authority or any other person is required on its part in order for it to execute and deliver this Agreement and to consummate the transactions contemplated hereby and (ii) the execution and delivery of this Agreement by it and the consummation of the transactions contemplated hereby will not conflict with or result in a material breach or violation of, or accelerate the maturity or the date upon which performance must be commenced or completed under, any material agreement to which it is a party. (xii)It (A) has duly executed and delivered the Company Purchase Agreement pursuant to which the Company has agreed, on the terms and subject to the conditions therein, to purchase five million three hundred thousand (5,300,000) shares of Company Common Stock from FLC at a purchase price of $28.00 per share; and (B) has delivered a true and correct copy of such agreement to Liberty. (c) Representations of Liberty. Liberty represents and warrants to each of MBO-IV and IP that: (i) Liberty is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. (ii) Liberty has all necessary corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby; and the execution and delivery of this Agreement by Liberty, and the consummation by Liberty of the transactions contemplated hereby, have been duly and validly authorized by all necessary corporate action on the part of Liberty, and no other corporate proceedings on the party of Liberty are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. (iii) This Agreement has been duly and validly executed and delivered by Liberty, and, assuming the due execution and delivery thereof by each of MBO-IV and IP, is a valid and binding obligation of Liberty enforceable against Liberty in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting the rights of creditors generally and by general principles of equity. (iv) There is no action, suit, investigation or proceeding, governmental or otherwise, pending or, to the best of Liberty's knowledge threatened, against Liberty specifically relating to the transactions contemplated by this Agreement, nor is there any basis therefor known to Liberty. (v) Assuming that the Purchased Shares are acquired by Liberty in a transaction exempt from registration under the Securities Act and from qualification or registration under applicable state securities laws, (A) no consent, approval or authorization of, nor any registration, qualification or filing with, any governmental agency or authority or any other person is required on the part of Liberty in order for Liberty to execute and deliver this Agreement and for Liberty to purchase the Purchased Shares at the Closing; and (B) the execution and delivery of this Agreement by Liberty and the purchase by it of the Purchased Shares at the Closing will not conflict with or result in a material breach or violation of, or accelerate the maturity or the date upon which performance must be commenced or completed under, any material agreement to which Liberty is a party. (vi) Except as expressly set forth in this Agreement, Liberty is not relying on any representations or warranties (whether written or oral) of FLC. Liberty has consulted with its own advisors to the extent it deemed necessary and has made its own investment decision based on its own judgment and upon any advice from any such advisors. (d) Investment Representations of Liberty. Liberty represents and warrants to each of MBO-IV and IP that: (i) Liberty understands that the Purchased Shares it is acquiring pursuant to this Agreement are being offered and sold pursuant to an exemption from registration and qualification based in part upon the representations of Liberty contained herein and that any subsequent transfer or assignment of the Purchased Shares must be made pursuant to a transaction which is exempt from registration under the Securities Act or pursuant to an effective registration statement. Liberty is an institutional accredited investor within the meaning of Section (a)(1), (2), (3), (7) or (8) of Rule 501 of the Securities Act. (ii) Liberty has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the investment contemplated by this Agreement; Liberty is able to bear the economic risk of its investment in the Company. (iii) Liberty is acquiring the Purchased Shares solely for its own account for investment and not with a view toward resale, transfer, or distribution thereof, nor with any present intention of distributing the Purchased Shares. No other person has any right with respect to or interest in the Purchased Shares to be acquired by Liberty, nor has Liberty agreed to give any person any such interest or right in the future. 2. ASSIGNMENT Pursuant to and in accordance with the terms and conditions of the Registration Rights Agreement, and effective upon the consummation of the transactions contemplated hereby, (a) each of MBO-IV and IP hereby assigns to Liberty its rights, benefits and obligations with respect to the Purchased Shares under the Registration Rights Agreement, and (b) Liberty hereby (i) accepts and assumes such rights, benefits and obligations, and (ii) agrees to be bound by the terms of the Registration Rights Agreement; provided, however, that notwithstanding the foregoing, the parties acknowledge and agree that (x) upon the withdrawal of the registration statement dated August 26, 1998, FLC shall be entitled to utilize one of the registrations to which Liberty is entitled pursuant to Section 2.1 of the Registration Rights Agreement until such time as all Registrable Securities (as defined in the Registration Rights Agreement) owned by FLC have been sold and (y) so long as it continues to own Registrable Securities, FLC shall continue to be entitled to exercise its incidental registration rights pursuant to Section 2.2 of the Registration Rights Agreement. 3. DELIVERIES OF FLC AT CLOSING At the Closing, FLC will deliver to Liberty: (i) a letter to ChaseMellon Shareholder Services, L.L.C., as transfer agent for the Company Common Stock (the "Transfer Agent"), instructing the Transfer Agent to transfer (by book entry transfer) the Purchased Shares to an account designated by Liberty with the Transfer Agent; and (ii) an irrevocable proxy (in the form of Exhibits A-1 and A-2 hereto, as applicable) executed by each of MBO-IV and IP, as the record owner of the Purchased Shares, granting to Liberty the right to vote all of the Purchased Shares at the Company's 1999 annual meeting of stockholders (the record date for which was March 31, 1999). 4. DELIVERIES OF LIBERTY AT CLOSING At the Closing, Liberty will deliver to FLC the Purchase Price by wire transfer of immediately available funds to the respective accounts previously designated by FLC. 5. CONDITIONS TO CLOSING (a) Conditions Precedent to the Obligations of FLC and Liberty. The obligations of each of MBO-IV and IP, on the one hand, and Liberty, on the other, to consummate the transactions contemplated by this Agreement are subject to the satisfaction at or prior to the Closing Date of each of the following conditions: (i) Absence of Injunctions. No permanent or preliminary injunction or restraining order or other order by any court or other governmental entity of competent jurisdiction or other legal restraint or prohibition preventing consummation of the transactions contemplated hereby as provided herein shall be in effect. (ii) No Proceedings or Adverse Enactments. There shall not have been any action taken, or any statute, rule, regulation, order, judgment or decree enacted, promulgated, entered, issued or enforced by any foreign or United States federal, state or local governmental entity, and there shall be no action, suit or proceeding pending or threatened which (i) makes the transactions contemplated by this Agreement illegal or imposes, or is reasonably likely to result in the imposition of, material damages or penalties in connection therewith, or (ii) would, as of or after the Closing, impose material limitations on the ability of Liberty effectively to exercise full rights of ownership of the Purchased Shares (including the right to vote the Purchased Shares on all matters properly presented to the stockholders of the Company). (iii) Company Purchase Agreement. (a) All conditions to the consummation of the transactions contemplated by the Company Purchase Agreement shall have been satisfied or waived and the parties thereto shall be fully prepared to consummate the transactions contemplated thereby; and (b) the transactions contemplated by the Company Purchase Agreement are in the process of being consummated contemporaneously with the consummation of the transactions contemplated by this Agreement. (iv) Rule 144 Sale. MBO-IV and IP shall have entered into an arrangement (the "Rule 144 Sale Arrangements") with Goldman Sachs & Co. to sell an aggregate of at least 4,000,000 shares of Company Common Stock (other than the Purchased Shares and the shares of Company Common Stock subject to the Company Purchase Agreement) under Rule 144 of the Securities Act, and Liberty shall have received evidence of such arrangement reasonably satisfactory to it. (b) Conditions Precedent to the Obligations of Liberty. The obligation of Liberty to consummate the transactions contemplated by this Agreement is also subject to the satisfaction, at or prior to the Closing Date, of each of the following conditions, any or all of which may be waived in whole or in part by Liberty, to the extent permitted by applicable law: (i) Accuracy of Representations and Warranties. All representations and warranties of MBO-IV and IP contained in this Agreement shall, if specifically qualified by materiality, be true and correct and, if not so qualified, be true and correct in all material respects in each case as of the date of this Agreement and on and as of the Closing Date, with the same force and effect as though made on and as of the Closing Date, except for changes expressly permitted or contemplated by this Agreement. (ii) Performance of Agreements. Each of MBO-IV and IP shall have performed in all material respects all obligations and agreements, and complied in all material respects with all covenants and conditions, contained in this Agreement to be performed or complied with by it prior to or on the Closing Date. (iii) No Material Adverse Change. Since the date hereof nothing shall have occurred which, individually or in the aggregate, has had or, in the reasonable judgment of Liberty, is reasonably likely to have, a material adverse effect on the Company and its subsidiaries or their businesses, taken as a whole. (iv) Officer's Certificates. Liberty shall have received a certificate, dated the Closing Date, signed by a general partner of each of MBO-IV and IP (x) as to the satisfaction of the conditions set forth in clauses (i) and (ii) of this Section 5(b) and clause (iii) of Section 5(a), and (y) attaching thereto a true and correct copy of the Registration Rights Agreement. (v) Company Deliveries. Liberty shall have received (A) a certificate from an executive officer of the Company, dated the Closing Date as to the matters referred to in subsection (b)(iii) of this Section 5, and (B) a letter of the Company, dated the Closing Date and signed by an executive officer of the Company, acknowledging, among other things, the assignment of rights to Liberty under the Registration Rights Agreement (such letter to be in form and substance reasonably acceptable to Liberty). (vi) Withdrawal of Registration Statement. FLC shall have delivered a letter to the Company requesting the Company to apply to the Securities and Exchange Commission for withdrawal of the Registration Statement filed on August 26, 1998. (vii) Other Deliveries. All other documents and instruments required under this Agreement (including those required pursuant to Section 3) to have been delivered by each of MBO-IV and IP to Liberty at or prior to the Closing or as Liberty shall have reasonably requested shall have been delivered by each of MBO-IV and IP. (c) Conditions Precedent to the Obligations of FLC. The obligation of FLC to consummate the transactions contemplated by this Agreement is also subject to the satisfaction, at or prior to the Closing Date, of each of the following conditions, any or all of which may be waived in whole or in part by FLC, to the extent permitted by applicable law: (i) Accuracy of Representations and Warranties. All representations and warranties of Liberty contained in this Agreement shall, if specifically qualified by materiality, be true and correct and, if not so qualified, be true and correct in all material respects in each case as of the date of this Agreement and on and as of the Closing Date, with the same force and effect as though made on and as of the Closing Date, except for changes expressly permitted or contemplated by this Agreement. (ii) Performance of Agreements. Liberty shall have performed in all material respects all obligations and agreements, and complied in all material respects with all covenants and conditions, contained in this Agreement to be performed or complied with by them prior to or on the Closing Date. (iii) Officer's Certificates. FLC shall have received a certificate of Liberty dated the Closing Date, signed by an executive officer of Liberty, as to the satisfaction of the conditions set forth in clauses (i) and (ii) above. (iv) Other Deliveries. All other documents and instruments required under this Agreement (including those required pursuant to Section 4) to have been delivered by Liberty to FLC at or prior to the Closing, or as FLC shall have reasonably requested shall have been delivered by Liberty. 6. TERMINATION (a) Termination. This Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to the Closing, (i) by mutual written consent of Liberty and each of MBO-IV and IP; or (ii) by either Liberty or FLC: (A) if the Closing shall not have occurred on or before 2:00 p.m. New York City time (in the case of a termination by FLC) or 5:00 p.m. New York City time (in the case of a termination by Liberty) on April 5, 1999, provided that the right to terminate this Agreement pursuant to this clause (ii)(A) shall not be available to any party whose failure to perform any of its obligations under this Agreement required to be performed by it at or prior to the Closing has resulted in the failure of the Closing to occur before such date, (B) if there has been a material breach by the other party of any of its representations, warranties, covenants or agreements contained in this Agreement and such breach shall not have been cured within five business days after written notice thereof shall have been received by the party alleged to be in breach or (C) if any court of competent jurisdiction or other competent governmental entity shall have issued an order, decree or ruling or taken any other action permanently restraining, enjoining or otherwise prohibiting any of the transactions contemplated by this Agreement and such order, decree, ruling or other action shall have become final and nonappealable. (b) Effect of Termination. In the event of any termination of this Agreement by Liberty or FLC pursuant to Section 6(a) hereof, this Agreement forthwith shall become void, and there shall be no liability or obligation on the part of any party hereto, except that nothing herein will relieve a party from liability for any breach of this Agreement occurring prior to such termination. 7. COVENANTS (a) Reasonable Efforts. Upon the terms and subject to the conditions hereof, each of the parties hereto agrees to use its commercially reasonable efforts to take, or cause to be taken, all appropriate action, and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations or otherwise to consummate the transactions contemplated hereby. (b) Covenant of FLC. During the period from the date hereof to and including the 90th day following the Closing (the "Lock-Up Period"), neither MBO-IV nor IP will, without the prior written consent of Liberty, directly or indirectly, (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale of, or otherwise dispose of or transfer any shares of Company Common Stock, or any securities convertible into or exchangeable or exercisable for Company Common Stock, or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Company Common Stock, whether any such swap or transaction is to be settled by delivery of Company Common Stock or other securities, in cash or otherwise; provided, however, that the provisions of this Section 7(b) shall not be applicable to the sale of shares of Company Common Stock pursuant to and in accordance with (A) the Company Purchase Agreement, (B) the Rule 144 Sale Arrangements and (C) a Block Sale Transaction (as defined below). "Block Sale Transaction" shall mean a sale of not less than 200,000 shares of Company Common Stock in one transaction or a series of transactions taking place on a single trading day (i) pursuant to a sell order placed with a single brokerage firm, (ii) to a single market-maker or (iii) to an institutional investor, in any case at a price per share (before selling expenses) of not less than $28. 8. RIGHT OF FIRST REFUSAL (a) Liberty, as assignee of TCI Ventures Group, LLC ("Ventures Group"), hereby waives its right of first refusal under that certain letter agreement, dated August 1, 1998 (the "Letter Agreement"), among MBO-IV, IP, Ventures Group and the other parties thereto, with respect to the sale of shares of Company Common Stock pursuant to and in accordance with (i) the Company Purchase Agreement, (ii) the Rule 144 Sale Arrangements, (iii) any Block Sale Transaction taking place prior to the conclusion of the Lock-Up Period and (iv) any Market Sale (as defined below) consummated after the Lock-Up Period at a price per share (before selling expenses) of $28.00 or more. (b) Each of MBO-IV and IP hereby acknowledges and agrees that, except as provided in subsection 8(a) above, Liberty's right of first refusal under the Letter Agreement shall continue in effect with respect to all shares of Company Common Stock owned by MBO-IV or IP following the Closing in accordance with the terms thereof (including Section 3 thereof); provided, however, that the parties agree that with respect to any open market sale of Company Common Stock proposed to be made by FLC after the Closing at a price per share (before selling expenses) of less than $28.00, the right of first refusal pursuant to the Letter Agreement (if applicable) shall be effected as follows: (x) Each of MBO-IV and IP shall notify Liberty of its intention to sell in a broker transaction on the New York Stock Exchange or to a market-maker (a "Market Sale"); such notice (a "Sale Notice") shall specify the number of shares of Company Common Stock proposed to be sold and shall specify the price at which MBO-IV or IP is willing to sell; such Sale Notice shall be in writing and shall be delivered to Liberty via telecopier and shall constitute an offer by FLC to sell the number of shares specified therein at the price specified therein; (y) If Liberty delivers written notice (by telecopier) to MBO-IV or IP (as applicable) within 24 hours of its receipt of the Sale Notice accepting the offer set forth in the Sale Notice, Liberty shall be obligated to thereafter purchase the shares of Company Common Stock specified in the Sale Notice at the price specified therein, all in accordance with the terms and procedures set forth in the Letter Agreement, except that the closing thereunder shall take place on a mutually agreed date not later than the sixth business day following Liberty's receipt of the Sale Notice; and (z) If Liberty does not deliver such notice within the time specified, MBO-IV and IP shall be permitted to sell up to the aggregate number of shares specified in the Sale Notice in open market transactions at a price per share of Company Common Stock not less than that specified in the Sale Notice during the period ending at the close of business on the fifth trading day following the date of delivery of the Sale Notice. 9. MISCELLANEOUS (a) Further Assurances. From and after the Closing Date, each of MBO-IV, IP and Liberty shall, at any time and from time to time, make, execute and deliver, or cause to be made, executed and delivered, such instruments, agreements, consents and assurances and take or cause to be taken all such actions as may reasonably be requested by the other party hereto to effect the purposes and intent of this Agreement. (b) Expenses. Except as otherwise provided herein, all costs and expenses, including, without limitation, fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses, whether or not the Closing shall occur. (c) Notices. All notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given on (i) the day on which delivered personally or by telecopy (with prompt confirmation by mail) during a business day to the appropriate location listed as the address below, (ii) three business days after the posting thereof by United States registered or certified first class mail, return receipt requested, with postage and fees prepaid or (iii) one business day after deposit thereof for overnight delivery. Such notices, requests, demands, waivers or other communications shall be addressed as follows: (i) if to either MBO-IV or IP to: c/o Forstmann Little & Co. 767 Fifth Avenue New York, New York 10153 Attention: Winston W. Hutchins Telecopy No.: (212) 759-9059 with a copy to: Fried, Frank, Harris, Shriver & Jacobson One New York Plaza New York, New York 10005 Attn: Aviva Diamant, Esq. Telecopy No.: (212) 859-4000 (ii) if to Liberty to: Liberty Media Corporation 8101 East Prentice Avenue Englewood, Colorado 80111 Attn: Charles Y. Tanabe, Esq. Telecopy No.: (303) 721-5443 with a copy to: Baker & Botts, L.L.P. 599 Lexington Avenue New York, New York 10022 Attn: Frederick H. McGrath, Esq. Telecopy No.: (212) 705-5125 or to such other person or address as any party shall specify by notice in writing to the other party. (d) Entire Agreement. This Agreement (including the documents referred to herein) constitutes the entire agreement between the parties and supersedes all prior agreements and understandings, oral and written, between the parties with respect to the subject matter hereof. (e) Amendment. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties. (f) Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without regard to conflicts of laws. (g) Assignment. No party hereto (or any permitted assignee of such party's rights or obligations hereunder) may assign its right or delegate its obligations hereunder without the prior written consent of the other party hereto, except as otherwise permitted by and in accordance with the terms hereof and except that Liberty may assign its rights hereunder to an entity which is a wholly owned subsidiary of Liberty as of the Closing so long as the representations and warranties made by Liberty herein are equally true as to such subsidiary. Nothing in this Agreement, expressed or implied, is intended to confer on any person other than the parties or their respective successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. (h) Certain Definitions. As used in this Agreement, the term "person" shall mean and include any individual, partnership, joint venture, corporation, trust, unincorporated organization or association or any other entity or association of any kind and any authority, federal, state, local or foreign government, any political subdivision of any thereof and any court, panel, judge, board, bureau, commission, agency or other entity or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government. (i) Counterparts. This Agreement may be executed in several counterparts and as so executed shall constitute one agreement binding on the parties hereto. (j) Severability. In the event that any part or parts of this Agreement shall be held to be unenforceable to its or their full extent, then it is the intention of the parties hereto that such part or parts shall be enforced to the full extent permitted under the laws, and in any event, that all other parts of this Agreement shall remain valid and fully enforceable as if the unenforceable part or parts had never been a part hereof. IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement as of the date first written above. FORSTMANN LITTLE & CO. SUBORDINATED DEBT AND EQUITY MANAGEMENT BUYOUT PARTNERSHIP-IV By: FLC XXIX Partnership, L.P., General Partner By:/s/ Steven B. Klinsky ----------------------------- Name: Steven B. Klinsky Title: General Partner INSTRUMENTS PARTNERS By: FLC XXII Partnership, General Partner By:/s/ Steven B. Klinsky ----------------------------- Name: Steven B. Klinsky Title: General Partner LIBERTY MEDIA CORPORATION By:/s/ Robert R. Bennett ----------------------------------- Name: Robert R. Bennett Title: President -----END PRIVACY-ENHANCED MESSAGE-----