Exhibit 10.1

 

PROXY AND RIGHT OF FIRST REFUSAL AGREEMENT

 

This Proxy and Right of First Refusal Agreement, dated as of May 18, 2016, (this “ Agreement ”), is by and among Liberty Broadband Corporation, a Delaware corporation (“ Liberty ”), Advance/Newhouse Partnership, a New York general partnership (“ A/N ”), and, for the limited purposes of the proviso to Section 2(e)  and Section 7(k) , Charter (as defined below) and New Charter (as defined below).  For purposes of this Agreement, capitalized terms used and not defined herein shall have the respective meanings ascribed to such terms in the Amended and Restated Stockholders Agreement, dated as of May 23, 2015 (the “ Stockholders Agreement ”), by and among Liberty, A/N, Charter Communications, Inc., a Delaware corporation (“ Charter ”), and CCH I, LLC, a Delaware limited liability company (“ New Charter ”), as amended by the letter agreement among Liberty, A/N, Charter and New Charter, dated as of the date hereof, as such Stockholders Agreement is in effect on the date hereof and without giving effect to any amendments or modifications thereto unless it has been amended or modified in accordance with its terms.

 

WHEREAS, pursuant to the Contribution Agreement, dated March 31, 2015 (as amended) (the “ Contribution Agreement ”), by and among A/N, A/NPC Holdings LLC, Charter, New Charter and Charter Communications Holdings, LLC (“ Charter Holdco ”), A/N is contributing (a) all of the issued and outstanding limited liability company membership interests of Bright House Networks, LLC, a Delaware limited liability company, to Charter Holdco in exchange for (i) cash, (ii) preferred units of Charter Holdco (the “ Preferred Units ”), (iii) common units of Charter Holdco (the “ Common Units ,” and together with the Preferred Units , the “ Holdco Units ”) and (b) one share of Class B Common Stock in exchange for the sum of $1.00;

 

WHEREAS, as of the date hereof, the Holdco Units are exchangeable into approximately 40,329,334 shares of Class A Common Stock (the number of shares into which the Holdco Units and shares of Class B Common Stock are convertible or exchangeable is hereinafter sometimes referred to as the “ A/N Notional Shares ”);

 

WHEREAS, the share of Class B Common Stock issued to A/N will have variable voting rights which will reflect the votes attributable to the A/N Notional Shares as if all Holdco Units and shares of Class B Common Stock had been exchanged into Class A Common Stock immediately prior to any Record Date;

 

WHEREAS, as a condition to Liberty’s execution of the Stockholders Agreement, A/N has agreed to grant to Liberty a proxy to vote a portion of the votes represented by the Common Shares and a right of first refusal with respect to a Transfer of shares of Class A Common Stock (or shares of Class A Common Stock underlying any Common Units) that A/N proposes to Transfer under certain circumstances, all as provided herein; and

 

WHEREAS, A/N and Liberty are entering into this Agreement in order to set forth the terms and conditions of the A/N Proxy and the other matters as provided herein.

 

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NOW, THEREFORE, in consideration of the foregoing and the covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1.                                       CERTAIN DEFINITIONS .

 

As used in this Agreement, the following terms have the respective meanings set forth below.

 

“ 40 Act ” means the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

 

“ 40 Act Event ” means any action, event, change in Law, change in composition of assets or other occurrence which in the reasonable opinion of Liberty’s outside counsel results or will result in Liberty becoming required to register as an investment company under the 40 Act; provided , that in making such determination any potential grace period between the date that Liberty determines that it is required to register as an investment company under the 40 Act (or the date the applicable Governmental Entity makes such a determination with respect to Liberty) and the date such registration is required to become effective under the 40 Act shall be disregarded.

 

“ Acquisition Cap ” means the greater of (a) 26% and (b) the Voting Cap of Liberty.

 

“ Agreement ” has the meaning set forth in the Preamble.

 

“ A/N ” has the meaning set forth in the Preamble.

 

“ A/N Notional Shares ” has the meaning set forth in the Recitals.

 

“ Beneficial Owner ” and “ Beneficial Ownership ” has the meaning set forth in the Stockholders Agreement; provided , that, for purposes of this Agreement, (i) each holder of Holdco Units will be deemed to Beneficially Own the shares of Class A Common Stock and Class B Common Stock issuable upon the exchange of such Holdco Units (regardless of whether such Holdco Units are then directly or indirectly exchangeable for Class A Common Stock or Class B Common Stock), and (ii) shares of Class A Common Stock issuable upon exercise, conversion or exchange of any Convertible Security (other than Holdco Units and Class B Common Stock) will not be deemed Beneficially Owned by the holder of such Convertible Security until such shares are issued and outstanding following the exercise, conversion or exchange of such Convertible Security.  Notwithstanding the foregoing, for purposes of determining the voting power of the Voting Securities of Charter Beneficially Owned (x) by Liberty, the voting power attributable to the Proxy Shares will be excluded from such calculation, and (y) by A/N, the voting power of the Voting Securities Beneficially Owned by it will be determined without duplication as among the different type of securities owned. For the avoidance of doubt, references to the Beneficial Ownership by Liberty or A/N of any securities or control of any voting power will be deemed to refer to the ownership of such securities or control of such voting power by the Liberty Parties collectively or the A/N Parties collectively, as the case may be.

 

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“ Board ” means the Board of Directors of Charter.

 

“ Business Day ” means a day, other than a Saturday or Sunday, on which commercial banks in New York City are open for the general transaction of business.

 

“ Certificate ” means the Amended and Restated Certificate of Incorporation of Charter, as in effect at the Effective Time (as the same may be amended from time to time).

 

A “ Change of Control ” means,

 

(i)                                      with respect to Charter, the occurrence of an event described in clause (i) of Company Change of Control; and

 

(ii)                                   with respect to Liberty, a Liberty Change of Control.

 

“ Charter ” has the meaning set forth in the Preamble, provided that Charter means (a) until immediately prior to the closing of the TWC Transactions, Charter, and (b) from and thereafter, New Charter, unless the context otherwise requires.

 

“ Charter Holdco ” has the meaning set forth in the Preamble.

 

“ Class A Common Stock ” means the Class A Common Stock, par value $0.001 per share, of Charter as it will be constituted immediately following the Effective Time, and any capital stock into which such Class A Common Stock may thereafter be changed (whether as a result of a recapitalization, reorganization, merger, consolidation, share exchange or other transaction or event).

 

“ Class B Common Stock ” means the Class B Common Stock of Charter as it will be constituted immediately following the Effective Time, and any capital stock into which such Class B Common Stock may thereafter be changed (whether as a result of a recapitalization, reorganization, merger, consolidation, share exchange or other transaction or event, other than any conversion of shares of Class B Common Stock into Class A Common Stock pursuant to the Amended and Restated Certificate).

 

“ Common Shares ” means, collectively, the Class A Common Stock and the Class B Common Stock.

 

“ Common Units ” has the meaning set forth in the Recitals.

 

“ Contribution Agreement ” has the meaning set forth in the Recitals.

 

“ Convertible Securities ” means (x) any securities of a Person that are convertible into or exercisable or exchangeable for any shares of any class or series of common stock of such Person or any other Person, whether upon conversion, exercise, or exchange, pursuant to antidilution provisions of such securities or otherwise (other than, for purposes of this Agreement, the Class B Common Stock), and (y) any subscriptions, options, rights, warrants or calls (or any similar securities) or agreements or arrangements of any character, in each case to acquire common stock, preferred stock or other capital stock.

 

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“ Covered First Securities ” means the first Common Units or shares of Class A Common Stock (but not Preferred Units or any Common Units into which the Preferred Units may be converted) proposed to be Transferred by A/N up to and including the number of such shares of Class A Common Stock underlying such Common Units and such shares of Class A Common Stock that constitute 7.0% of the Total Voting Power calculated immediately following the Effective Time; provided , that for the avoidance of doubt, following the Transfer of Class A Common Stock to Liberty or a Prospective Purchaser, such shares of Common Stock so Transferred will cease to be Covered First Securities.

 

“ Covered Last Securities ” means those Common Units or shares of Class A Common Stock constituting the last 7% of the Total Voting Power Beneficially Owned by A/N (disregarding for this purpose any Preferred Units or any Common Units into which the Preferred Units may be converted).

 

“ Covered Securities ” has the meaning set forth in Section 3(a) .

 

“ DGCL ” means the General Corporation Law of the State of Delaware.

 

“ Effective Time ” means the time of the Closing.

 

“ Equity Security ” means any Class A Common Stock or Common Units.

 

“ Excluded Matters ” has the meaning set forth in the Stockholders Agreement, provided that any proposed change to the terms of the Class B Common Stock also shall be deemed an Excluded Matter for purposes hereof.

 

“ Expiration Date ” has the meaning set forth in Section 6(i) .

 

“ Holdco Units ” has the meaning set forth in the Recitals.

 

“ Liens ” has the meaning set forth in Section 4(a)(ii) .

 

“ Liberty Elected Shares ” has the meaning set forth in Section 3(b)(ii) .

 

“ Liberty Notice ” has the meaning set forth in Section 3(b)(ii) .

 

“ LLC Agreement ” means the Amended and Restated Limited Liability Company Agreement of Charter Holdco, by and among New Charter, CCH II, LLC, A/N and Charter Holdco, dated as of the date of hereof, as such agreement is in effect on the date of this Agreement.

 

“ Notice of Foreclosure ” has the meaning set forth in the LLC Agreement.

 

“ Permitted Transferee ” means any A/N Party (i) to whom Common Shares or Common Units are Transferred and (ii) who executes an A/N Assumption Instrument in connection with such Transfer.

 

“ Preferred Units ” has the meaning set forth in the Recitals.

 

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“ Prospective Purchaser ” has the meaning set forth in Section 3(b)(i) .

 

“ Proxy ” has the meaning set forth in Section 2(a)(ii) .

 

“ Proxy Percentage ” means, as of any date of determination, the difference, if any, between the Target Percentage and the Voting Interest of Liberty (which, for the avoidance of doubt, shall exclude any Proxy Shares granted pursuant to this Agreement and any shares of Class A Common Stock which Liberty may purchase pursuant to any pending Preemptive Share Purchase); provided , however , that (x) in no event will the Proxy Percentage be greater than 7.0% (and any excess votes reflected by a percentage above 7% shall inure to the A/N Parties, subject to the Voting Cap of A/N) and (y) in the event the Proxy Percentage as calculated would be a negative number, the Proxy Percentage will be deemed to be zero.

 

“ Proxy Shares ” means the shares of Class A Common Stock and Class B Common Stock to the extent that Liberty has the right to vote such shares pursuant to this Agreement; provided , that the number of Proxy Shares shall equal the number of shares of Class  A Common Stock and Class B Common Stock that would cause the Voting Interest of Liberty to equal the Target Percentage; provided , further , that the maximum number of Proxy Shares shall not exceed the Proxy Percentage.

 

“ Record Date ” means the date for the determination of stockholders entitled to receive notice of, and to vote at, any meeting of the stockholders of Charter, or in any other circumstances upon which stockholders are entitled to vote, consent or otherwise grant approval (including by written consent) occurs.

 

“ ROFR ” has the meaning set forth in Section 3(a) .

 

“ ROFR Notice ” has the meaning set forth in Section 3(b)(i) .

 

“ Stockholders Agreement ” has the meaning set forth in the Preamble.

 

“ Subject Shares ” has the meaning set forth in Section 3(b)(i) .

 

“ Target Percentage ” means 25.01%; provided , that if the number of Common Shares having voting power equal to 25.01% of the Total Voting Power is not a whole number of shares, the number of Common Shares necessary to achieve the Target Percentage will be rounded up to the nearest whole number.

 

“ Trading Day ” means any day on which The Nasdaq Stock Market is open for regular trading of the Class A Common Stock.

 

“ Transfer ” has the meaning ascribed thereto in the Stockholders Agreement; provided that Transfer as used in this Agreement shall not include a Transfer (or deemed Transfer) effected by an A/N Party in compliance with Section 4.6(c), Section 4.6(d) or Section 4.6(e) of the Stockholders Agreement (it being understood, however, that any sale of Class A Common Stock by a lender following a foreclosure upon any Common Units pledged by any A/N Party in connection with a Stand Alone Margin Loan or an Equity Linked Financing or sales or other dispositions of Class A Common Stock pursuant to any put, call or exchange feature of securities sold pursuant to

 

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Section 4.6(e) of the Stockholders Agreement shall be deemed to be a Transfer that is subject to the provisions of Section 3 ); and provided, further, that if any Permitted Transferee ceases to meet the requirements to be an A/N Party, such Person shall cease to be a Permitted Transferee and the cessation of such qualification shall constitute a Transfer to a Person other than a Permitted Transferee for purposes of Section 3 .

 

“ Transferor ” has the meaning set forth in Section 3(b) .

 

“ VWAP ” means, for any Trading Day, a price per share of Class A Common Stock equal to the volume-weighted average price of the Rule 10b-18 eligible trades in the shares of Class A Common Stock for the entirety of such Trading Day as determined by reference to the screen entitled “CHTR <EQUITY> AQR SEC” as reported by Bloomberg L.P. (without regard to pre-open or after hours trading outside of any regular trading session for such Trading Day).

 

“ VWAP Price ” has the meaning set forth in Section 3(b)(i) .

 

2.                                       PROXY AND OTHER GOVERNANCE MATTERS .

 

(a)                                  Irrevocable Proxy Granted to Liberty .

 

(i)                                      A/N hereby irrevocably constitutes and appoints Liberty and any officer(s) or directors of Liberty designated as proxy or proxies by Liberty as its attorney-in-fact and proxy in accordance with the DGCL (with full power of substitution and re-substitution), for and in the name, place and stead of A/N (which, for the avoidance of doubt, includes any Permitted Transferee), to vote all Proxy Shares (at any meeting of stockholders of Charter however called or at any adjournment or postponement thereof), which will be deemed, for all purposes of this Agreement, to include the right to execute and deliver a written consent in respect of such Proxy Shares from time to time.

 

(ii)                                   The proxy granted pursuant to clause (i) (the “ Proxy ”) above is valid and irrevocable and is coupled with an interest for purposes of Section 212 of the DGCL and will terminate automatically pursuant to Section 6 .  The Proxy will be binding upon A/N, its successors and assigns (including, for the avoidance of doubt, any Permitted Transferee which acquires Beneficial Ownership of Common Shares), including any successor or surviving corporation resulting from any merger, consolidation or other business combination involving A/N.  A/N represents that any and all other proxies heretofore given in respect of the Proxy Shares are revocable, and that such other proxies either have been revoked or are hereby revoked.

 

(iii)                                Notwithstanding the foregoing, the Proxy shall not apply (and Liberty will have no right to vote the Proxy Shares) in connection with any vote on (or consent to approve) any matter that is an Excluded Matter.  For the avoidance of doubt, to the extent that more than one proposal is presented to stockholders of Charter for their consideration at a meeting (or through an action by written consent), Liberty will continue to have the right to vote the Proxy Shares on all proposals other than those relating to the Excluded Matters.  Any attempt by Liberty to vote the Proxy Shares on any Excluded Matter shall be void ab initio .

 

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(b)                                  Notwithstanding anything to the contrary set forth herein, the A/N Proxy is personal to Liberty and may not be assigned by Liberty by operation of law or otherwise; provided , that (i) Liberty may assign the A/N Proxy and its rights pursuant to Section 7(f)  and (ii) the exercise of the A/N Proxy by any duly authorized officer of Liberty (on behalf of Liberty) will not be deemed an assignment of the A/N Proxy.

 

(c)                                   Voting on Certain Matters .  Each of Liberty and A/N agrees to vote or act by written consent with respect to all Common Shares with respect to which it has the power to vote (whether by proxy or otherwise) in accordance with Section 3.2(h)  of the Stockholders Agreement.

 

(d)                                  Restrictions on Other Agreements .  Liberty and A/N agree to the restrictions set forth in Section 4.2(b) , (d) , (e)  and (g)  of the Stockholders Agreement.

 

(e)                                   A/N Covenant .

 

(i)                                      During the term of this Agreement, A/N agrees that it will not vote in favor of the approval of any amendment to Charter’s Certificate that would (i) reasonably be expected to result in a 40 Act Event occurring or (ii) prevent A/N from performing its obligations hereunder with respect to the A/N Proxy.

 

(ii)                                   In the event of a change in Law that would reasonably be expected to result in a 40 Act Event occurring during the term of this Agreement, A/N will in good faith consider any amendments to the terms of the A/N Proxy as proposed by Liberty to prevent the occurrence of such 40 Act Event; provided , that any such amendment shall require the prior written consent of Charter pursuant to Section 7(k) .

 

3.                                       RIGHT OF FIRST REFUSAL .

 

(a)                                  Grant .

 

(i)                                      Subject to and on the terms and conditions set forth in this Agreement, A/N hereby grants to Liberty a right of first refusal (the “ ROFR ”), as provided in Section 3(b)  of this Agreement, over the Covered First Securities and Covered Last Securities (collectively, the “ Covered Securities ”) and makes the covenants for the benefit of Liberty set forth herein.  Notwithstanding the foregoing, (x) Liberty shall not have a ROFR with respect to any Transfer of Covered Securities in any transaction or series of transactions constituting a Change of Control of Charter, and (y) Liberty shall not be entitled to acquire a number of Covered Securities under this Section 3 which when combined with Voting Securities of Charter Beneficially Owned by Liberty would cause Liberty to exceed the Acquisition Cap, provided , that Liberty shall be entitled to purchase up to that number of Covered Securities which would cause Liberty not to exceed the Acquisition Cap.  For the avoidance of doubt, the parties agree that the ROFR shall apply only once with respect to any Covered Securities that simultaneously constitute Covered First Securities and Covered Last Securities.

 

(ii)                                   Notwithstanding the foregoing, A/N may Transfer Equity Securities comprising any Covered Securities at any time during the term of this Agreement to

 

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Permitted Transferees, and Permitted Transferees may thereafter Transfer any such Equity Securities to other Permitted Transferees, provided that any Permitted Transferee shall, prior to taking ownership of such Equity Securities, execute and deliver to Liberty the A/N Assumption Agreement, in which such Permitted Transferee agrees to be bound to the terms of this Agreement (including the Proxy) with respect to such Equity Securities.  Any purported Transfer to a Permitted Transferee in violation of the foregoing sentence shall be void ab initio .

 

(b)                                  Terms and Procedures .  During the term of this Agreement, but subject at all times to the ability to satisfy a put of Common Units from A/N for cash in lieu of exchanging such Common Units for shares of Class A Common Stock pursuant to the LLC Agreement and Exchange Agreement (it being understood that, if and when such cash-out right is exercised in respect of Common Units, Liberty shall be entitled to purchase shares of Class A Common Stock on the terms set forth in Section 4.9 of the Stockholders Agreement), A/N (including any Permitted Transferee) (as applicable, the “ Transferor ”) shall not Transfer any Covered Securities, except to a Permitted Transferee (subject to Section 3(a)(ii) ), unless it shall first comply with the following provisions.

 

(i)                                      If a Transferor determines to Transfer any Equity Securities comprising Covered Securities in a bona fide transaction to a third party purchaser or offeror, in each case, that is not a Permitted Transferee (a “ Prospective Purchaser ”), the Transferor will provide written notice of such determination to Liberty (a “ ROFR Notice ”).  For the avoidance of doubt, (i) a Transferor may provide a ROFR Notice to Liberty upon its intention to sell Covered Securities to Liberty notwithstanding the absence of a Prospective Purchaser and (ii) a Transferor shall provide a ROFR Notice to Liberty contemporaneously with the delivery of a notice of exchange or a Notice of Foreclosure, as applicable, to Charter.  Such ROFR Notice will specify (A) the total number and type of Equity Securities determined to be Transferred, (B) the number of shares of Class A Common Stock or Common Units comprising the Covered Securities determined to be Transferred (the “ Subject Shares ”), and (C) the simple average of the VWAPs of the Class A Common Stock for each of the two (2) full Trading Days immediately prior to the date of the ROFR Notice (the “ VWAP Price ”).  The ROFR Notice will constitute a binding, irrevocable offer by the Transferor to sell any or all Subject Shares to Liberty at the VWAP Price per Subject Share.

 

(ii)                                   Within three (3) Trading Days following Liberty’s receipt of the ROFR Notice, Liberty may agree, by written notice to the Transferor (the “ Liberty Notice ”), to acquire the number and type of Subject Shares specified in the Liberty Notice (the “ Liberty Elected Shares ”) at a cash price per share equal to the VWAP Price.  If a Liberty Notice meeting the requirements specified above is not delivered within such three Trading Day period, then Liberty will be deemed to have rejected the offer of the Subject Shares.  For the avoidance of doubt, during such three Trading Day period, the Transferor may not effect the proposed Transfer to a Prospective Purchaser (unless prior to the expiration thereof, Liberty provides written notice to the Transferor that it is expressly rejecting the offer of the Subject Shares).

 

(iii)                                Upon delivery of a Liberty Notice meeting the requirements specified above within the specified period, the Transferor will be obligated to sell, and Liberty will be obligated to buy, all of the Liberty Elected Shares at the VWAP Price, payable in

 

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cash by wire transfer of immediately available funds.  The closing of such purchase and sale shall occur at such time and place as the parties thereto may agree, but in any event no later than the tenth (10th) Business Day after the Liberty Notice is delivered.  At the closing, each of the Transferor and Liberty will represent and warrant to the other that (a) it has all requisite power and authority to consummate the purchase and sale, (b) there are no consents or notices required to be obtained or delivered to third parties or Governmental Entities (including under the HSR Act) in connection with such purchase and sale, and (c) no injunction of any Governmental Entities exists that would prevent or delay such transactions from occurring, and the Transferor will represent and warrant to Liberty that the Transferor is transferring valid title to the Liberty Elected Shares free and clear of any Lien or restriction, other than applicable federal or state securities Laws or those created by this Agreement.

 

(iv)                               If Liberty rejects or is deemed to reject the offer of the Subject Shares (or a portion of such Subject Shares) set forth in the ROFR Notice, then the Transferor will be free to Transfer or otherwise sell on the market the Subject Shares which are not Liberty Elected Shares during the period of forty-five (45) calendar days following the date of the rejection or deemed rejection of the ROFR Notice, without restriction as to price or manner of sale.  If the Transferor does not complete the sale of such Subject Shares within five (5) Business Days of the expiration of such forty-five-day period, the Transferor must again comply with the terms of this Section 3 with respect to any proposed Transfer of such Subject Shares.

 

(v)                                  Each Transferor covenants and agrees that, subject to the terms of the LLC Agreement and the Exchange Agreement, prior to any Transfer of Common Units to Liberty pursuant to this Section 3 , the Transferor shall cause such Common Units to be exchanged for shares of Class A Common Stock pursuant to the terms of the LLC Agreement and the Exchange Agreement such that Liberty shall receive shares of Class A Common Stock (in lieu of Common Units) at the closing of the transactions contemplated by the applicable ROFR Notice.

 

4.                                       REPRESENTATIONS AND WARRANTIES OF A/N; ACKNOWLEDGEMENT .

 

(a)                                  A/N hereby represents and warrants to Liberty that:

 

(i)                                      Authority for this Agreement .  A/N is a general partnership duly organized, validly existing and in good standing under the Laws of the State of New York and has all necessary partnership power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  The execution and delivery of this Agreement by A/N and the consummation by A/N of the transactions contemplated hereby (i) will not violate or constitute a breach of or conflict with its partnership agreement and (ii) have been duly and validly authorized, and no other proceedings on the part of A/N are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.  This Agreement has been duly and validly executed and delivered by A/N and, assuming it has been duly and validly authorized, executed and delivered by Liberty, constitutes a legal, valid and binding obligation of A/N enforceable against A/N in accordance with its terms, except to the extent that

 

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enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar Laws relating to or affecting enforcement of creditors’ rights generally, and general principles of equity (regardless of whether enforcement is considered in a proceeding at law or in equity).

 

(ii)                                   Ownership of Shares .  A/N is the Beneficial Owner of all Holdco Units and Common Shares (including the Proxy Shares) received pursuant to the terms of the Contribution Agreement, in each case, free and clear of all pledges, liens, proxies, claims, charges, security interests, preemptive rights, voting trusts, voting agreements, options, rights of first offer or refusal and any other encumbrances whatsoever (collectively, “ Liens ”) with respect to the ownership, transfer or other voting of such securities, other than encumbrances created by this Agreement and any Transaction Agreement and any restrictions on transfer under applicable federal and state securities Laws.  A/N has the sole authority to direct the voting of the Common Shares in accordance with the provisions of this Agreement and the sole power of disposition with respect to the Common Shares and Holdco Units, with no restrictions (other than restrictions created by  this Agreement or any Transaction Agreement and any restrictions on transfer under applicable federal and state securities Laws).  Except for the Common Shares and the Holdco Units, as of the date hereof, A/N does not Beneficially Own nor owns of record (i) any other equity securities of Charter or Charter Holdco or (ii) any securities that are convertible into or exercisable or exchangeable for such equity securities.

 

5.                                       REPRESENTATIONS AND WARRANTIES OF LIBERTY . Liberty hereby represents and warrants to A/N that Liberty is a corporation duly organized, validly existing and in good standing under the Laws of the State of Delaware and has all necessary corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  The execution and delivery of this Agreement by Liberty and the consummation by Liberty of the transactions contemplated hereby (i) will not violate or constitute a breach of or conflict with its certificate of incorporation or bylaws and (ii) have been duly and validly authorized by, and no other proceedings on the part of, Liberty are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.  This Agreement has been duly and validly executed and delivered by Liberty and, assuming it has been duly and validly authorized, executed and delivered by A/N, constitutes a legal, valid and binding obligation of Liberty enforceable against Liberty in accordance with its terms, except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar Laws relating to or affecting enforcement of creditors’ rights generally, and general principles of equity (regardless of whether enforcement is considered in a proceeding at law or in equity).

 

6.                                       TERM; TERMINATION .  This Agreement will terminate upon the first to occur of:

 

(i)                                      the fifth (5 th ) anniversary of the Effective Date (the “ Expiration Date ”; provided that such Expiration Date may be extended upon the agreement of A/N and Liberty, to a subsequent agreed upon date, in which case such subsequent date will be deemed the Expiration Date);

 

(ii)                                   upon written notice by Liberty to A/N, that a 40 Act Event, as determined in the

 

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reasonable opinion of Liberty’s counsel, has occurred;

 

(iii)                                upon written notice by A/N to Liberty, upon a material breach by Liberty of any of its covenants or agreements contained herein, provided that such breach shall not have been cured within ten (10) Business Days after written notice thereof shall have been received by Liberty;

 

(iv)                               a Liberty Change of Control;

 

(v)                                  a Transfer by any Liberty Party of any shares of Class A Common Stock, other than (A) a Permitted Transfer, provided , that in the case of a Transfer pursuant to clause (y) of Section 4.6(b)(ix)  of the Stockholders Agreement, the Voting Interest of Liberty (including the Proxy Shares) shall equal no less than the Target Percentage following the completion of such Transfer, or within six (6) months following the completion of such Transfer, Liberty acquires such number of shares of Class A Common Stock as is necessary to cause the Voting Interest of Liberty (including the Proxy Shares) to be no less than the Target Percentage; (B) a Transfer of shares of Class A Common Stock constituting 1% or less of the Total Voting Power, provided , that, (x) Liberty shall have promptly notified A/N in writing of such Transfer, (y) A/N shall promptly have provided Liberty with written notice that this Agreement will terminate unless Liberty cures such breach within forty-five (45) calendar days and (z) within thirty (30) calendar days of receipt of notice from A/N, Liberty shall have (1) acquired such number of shares of Common Stock as is necessary to cause the Voting Interest of Liberty (including the Proxy Shares) to be no less than the Target Percentage and (2) certified in writing to A/N that the Voting Interest of Liberty (including the Proxy Shares) is no less than the Target Percentage; or (C) a Transfer by Liberty of any shares of Class A Common Stock following which Transfer Liberty retains no less than an Equity Interest equal to 17.01% (it being understood and acknowledged by Liberty, for the avoidance of doubt, that nothing in this Section 6(v) shall cause the Proxy Percentage to exceed, or to be required to exceed, 7.0%); or

 

(vi)                               upon the mutual written agreement of A/N and Liberty.

 

No party hereto will be relieved from any liability for breach of this Agreement by reason of such termination.

 

7.                                       MISCELLANEOUS .

 

(a)                                  Remedies .  The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in the Court of Chancery of the State of Delaware or any federal court sitting in the State of Delaware, without bond or other security being required, this being in addition to any other remedy to which they are entitled at law or in equity.

 

(b)                                  Further Assurances .  Each party shall cooperate and take such actions as may be reasonably requested by another party in order to carry out the provisions and purposes of this Agreement and the transactions contemplated hereby.

 

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(c)                                   Expenses .  Except as otherwise expressly provided in this Agreement, all costs and expenses incurred in connection with the transactions contemplated by this Agreement shall be paid by the party incurring such costs and expenses.

 

(d)                                  Governing Law .  This Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware.

 

(e)                                   Jurisdiction .  All actions and proceedings arising out of or relating to this Agreement shall be heard and determined in the Court of Chancery of the State of Delaware, or, if the Court of Chancery lacks subject matter jurisdiction, in any federal court sitting in the State of Delaware, and the parties hereto hereby irrevocably submit to the exclusive jurisdiction of such courts (and, in the case of appeals, appropriate appellate courts there from) in any such action or proceeding and irrevocably waive the defense of an inconvenient forum to the maintenance of any such action or proceeding.  The consents to jurisdiction set forth in this paragraph shall not constitute general consents to service of process in the State of Delaware and shall have no effect for any purpose except as provided in this paragraph and shall not be deemed to confer rights on any Person other than the parties hereto.  The parties hereto agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable Law.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

 

(f)                                    Assignment; Successors .  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned or delegated in whole or in part, by operation of Law, or otherwise, by any of the parties without the prior written consent of the other parties; provided , that Liberty may assign this Agreement to a Qualified Distribution Transferee.  Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and permitted assigns.  Any purported assignment or delegation not permitted under this Section 7(f)  shall be null and void and shall not relieve the assigning or delegating party of any obligation hereunder.

 

(g)                                   Descriptive Headings .  Headings of Sections and subsections of this Agreement are for convenience of the parties only, and shall be given no substantive or interpretive effect whatsoever.

 

(h)                                  Entire Agreement; No Third-Party Beneficiaries .  This Agreement and the Stockholders Agreement constitutes the entire agreement of the parties hereto, and supersede all other prior agreements and understandings, both written and oral, among the parties, with respect to the subject matter hereof and thereof.  Nothing in this Agreement shall be construed as giving any Person, other than the parties hereto and their respective heirs, successors, legal representatives and permitted assigns, any right, remedy or claim under or in respect of this Agreement or any provision hereof.

 

(i)                                      Notices .  Any notices or other communications required or permitted under, or otherwise in connection with this Agreement, shall be in writing and shall be deemed to have been duly given (A) when delivered in person, (B) upon transmission by electronic mail or

 

12

 

facsimile transmission as evidenced by confirmation of transmission to the sender (but only if followed by transmittal of a copy thereof by (x) national overnight courier or (y) hand delivery with receipt, in each case, for delivery by the second (2 nd ) Business Day following such electronic mail or facsimile transmission), (C) on receipt after dispatch by registered or certified mail, postage prepaid and addressed, or (D) on the next Business Day if transmitted by national overnight courier, in each case as set forth to the parties as set forth below:

 

If to A/N, to:

 

Advance/Newhouse Partnership
c/o Sabin Bermant & Gould LLP

One World Trade Center, 44 th  Floor

New York, NY 10007

Attention:                  Managing Partner

Phone:                                   (212) 381-7013

Facsimile:                  (212) 381-7232

E-Mail:                                rhuber@sabinfirm.com

 

with a copy (which shall not constitute notice) to:

 

Sullivan & Cromwell LLP
125 Broad Street
New York, NY 10004
Facsimile:  (212) 291-9067
Attention:  Brian E. Hamilton

Scott B. Crofton

E-Mail:  hamiltonb@sullcrom.com

croftons@sullcrom.com

 

13

 

If to Liberty, to:

 

Liberty Broadband Corporation

12300 Liberty Boulevard

Englewood, CO 80112

Facsimile: (720) 875-5401

Attention: Richard N. Baer

E-Mail: legalnotices@libertymedia.com

 

with a copy (which shall not constitute notice) to:

 

Baker Botts L.L.P.

30 Rockefeller Plaza

New York, New York 10112

Facsimile: (212) 259-2500

Attention:                        Frederick H. McGrath

Renee L. Wilm

E-Mail: frederick.mcgrath@bakerbotts.com

renee.wilm@bakerbotts.com

 

or such other address, email address or facsimile number as such party may hereafter specify by like notice to the other parties hereto.

 

(j)                                     Severability .  If any term or other provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced by any rule of law or public policy, all other terms, provisions and conditions of this Agreement shall nevertheless remain in full force and effect.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable Law in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

 

(k)                                  Amendments and Waivers .  The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers of or consents to departures from the provisions hereof may not be given, unless approved in writing by Liberty and A/N; provided , that any amendment to the terms of the A/N Proxy (other than the extension on the same terms hereof pursuant to Section 6(i)  hereof) shall require the prior written consent of Charter following the approval of such amendment by a majority of the Unaffiliated Directors, which consent shall not be unreasonably withheld, conditioned or delayed, except that Charter may withhold such consent pursuant to the fiduciary duties of the Unaffiliated Directors under applicable Law.  For the avoidance of doubt, Charter shall have no rights as a party hereto (including any consent right with respect to any amendments to the terms of the ROFR or the execution of any purchases thereunder, subject to the compliance by Liberty and A/N with their respective obligations under the Stockholders Agreement), except those rights expressly set forth in Section 2(e)  and this Section 7(k) .

 

14

 

(l)                                      No Implied Waivers .  No action taken pursuant to this Agreement, including any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the party taking such action of compliance with any representations, warranties, covenants or agreements contained herein or made pursuant hereto.  The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any preceding or succeeding breach and no failure by any party to exercise any right or privilege hereunder shall be deemed a waiver of such party’s rights or privileges hereunder or shall be deemed a waiver of such party’s rights to exercise the same at any subsequent time or times hereunder.

 

(m)                              Interpretation .  When a reference is made in this Agreement to a Section, Exhibit or Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated.  The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”.  The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  When this Agreement contemplates a certain number of securities, whether Common Shares or otherwise, as of a particular date, such number of securities shall be deemed to be appropriately adjusted to account for stock splits, dividends, recapitalizations, combinations of shares or other change affecting the such securities.

 

(n)                                  Counterparts .  This Agreement may be executed in counterparts (each of which shall be deemed to be an original but all of which taken together shall constitute one and the same agreement) and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.

 

[ signature page follows ]

 

15

 

IN WITNESS WHEREOF, each of the undersigned has executed this agreement as of the date first above written.

 

	LIBERTY BROADBAND CORPORATION
	By:	/s/ Craig Troyer
		Name:	Craig Troyer
		Title:	Vice President, Deputy General Counsel and Assistant Secretary
	ADVANCE/NEWHOUSE PARTNERSHIP
	By:	/s/ Steven A. Miron
		Name:	Steven A. Miron
		Title:	Chief Executive Officer
	For the limited purposes of the proviso to Section 2(e)  and Section 7(k) :
	CHARTER COMMUNICATIONS, INC.
	By:	/s/ Richard R. Dykhouse
		Name:	Richard R. Dykhouse
		Title:	Executive Vice President, General Counsel and Corporate Secretary
	CCH I, LLC
	By:	/s/ Richard R. Dykhouse
		Name:	Richard R. Dykhouse
		Title:	Executive Vice President, General Counsel and Corporate Secretary

 

[Signature Page to Proxy and Right of First Refusal Agreement]

 

Exhibit 10.2

 

 

REGISTRATION RIGHTS AGREEMENT

 

by and between

 

LIBERTY BROADBAND CORPORATION

 

and

 

QUANTUM PARTNERS LP

 

 

Dated May 18, 2016

 

 

 

 

THIS REGISTRATION RIGHTS AGREEMENT (this “ Agreement ”) is made and entered into as of May 18, 2016, by and between Liberty Broadband Corporation, a Delaware corporation (the “ Company ”), and Quantum Partners LP, a Cayman Islands exempted limited partnership (the “ Purchaser ”).

 

RECITALS

 

WHEREAS , the Company and Purchaser are parties to that certain Amended and Restated Investment Agreement, dated May 29, 2015 (the “ Investment Agreement ”), pursuant to which the Purchaser has purchased, and the Company has issued and sold to Purchaser, 8,895,050 shares (the “ Purchased Shares ”) of the Company’s Series C common stock, par value $0.01 per share (the “ Series C Stock ”);

 

WHEREAS , the Company has entered into one or more Other Investment Agreements (as defined in the Investment Agreement) with other equity financing sources (the “ Other Investors ”) pursuant to which the Other Investors have purchased, and the Company has issued and sold to such Other Investors, an aggregate of 69,357,992 shares of Series C Stock;

 

WHEREAS , as a material condition to Purchaser entering in the Investment Agreement, the Company agreed to enter into a registration rights agreement that provides Purchaser with the registration rights set forth on Schedule 1 to the Investment Agreement, and which includes such other customary terms and conditions that are reasonably acceptable to the Company and Purchaser; and

 

WHEREAS , this Agreement is the registration rights agreement contemplated by the Investment Agreement.

 

AGREEMENT

 

NOW, THEREFORE , in consideration of the premises and the mutual covenants contained herein and other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:

 

Section 1.                                            Definitions .

 

As used in this Agreement, the following terms have the meanings ascribed thereto below.  Capitalized terms used but not otherwise defined in this Agreement shall have the meanings given such terms in the Investment Agreement.

 

“ Affiliate ” of a Person has the meaning set forth in Rule 12b-2 under the Exchange Act.  For purposes of this definition, the term “control” (including the correlative meanings of the terms “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of such Person, whether through the ownership of voting securities or by contract or otherwise.

 

“ Agreement ” has the meaning set forth in the preamble of this Agreement, as it may be amended, supplemented or restated from time to time.

 

 

“ ASR Eligible ” means the Company meets or is deemed to meet the eligibility requirements to file an ASRS as set forth in General Instruction I.D. to Form S-3.

 

“ Available Remedies ” has the meaning set forth in Section 24(b) of this Agreement.

 

“ ASRS ” means an “automatic shelf registration statement” as defined in Rule 405 promulgated under the Securities Act.

 

“ Common Stock ” means the Company’s Series A Common Stock, par value $0.01 per share, Series B Common Stock, par value $0.01 per share, or Series C Stock.

 

“ Company ” has the meaning set forth in the preamble of this Agreement.

 

“ Company Registration Rights Indemnitee ” has the meaning set forth in Section 10(a)(ii) of this Agreement.

 

“ Contested Claim ” has the meaning set forth in Section 10(e) of this Agreement.

 

“ controlling person ” has the meaning set forth in Section 10(a)(i) of this Agreement.

 

“ Damages ” means any and all claims, demands, suits, actions, causes of actions, losses, costs, damages, liabilities, judgments, and out-of-pocket expenses incurred or paid, including reasonable attorneys’ fees, costs of investigation or settlement, other professionals’ and experts’ fees, court or arbitration costs, but specifically excluding consequential damages, lost profits, indirect damages, punitive damages, exemplary damages and any taxes incurred as a result of any recovery received.

 

“ Demand Registration ” has the meaning set forth in Section 2(a)(i) of this Agreement.

 

“ Demand Registration Request ” has the meaning set forth in Section 2(a)(i) of this Agreement.

 

“ Disclosure Package ” means, with respect to any offering of Registrable Securities, (i) the preliminary Prospectus, (ii) each Free Writing Prospectus and (iii) all other information, in each case, that is deemed, under Rule 159 under the Securities Act, to have been conveyed to purchasers of Registrable Securities at the time of sale of such securities.

 

“ Effectiveness Period ” has the meaning set forth in Section 5(k) of this Agreement.

 

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“ FINRA ” means the Financial Industry Regulatory Authority, Inc. or any successor regulatory organization.

 

 

“ Free Writing Prospectus ” means any “free writing prospectus” as defined in Rule 405 under the Securities Act.

 

“ Investment Agreement ” has the meaning set forth in the recitals of this Agreement.

 

“ Law ” means any applicable law, statute, constitution, principal of common law, ordinance, code, rule, regulation, ruling or other legal requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any governmental authority.

 

“ Notice of Reg Rights Claim ” has the meaning set forth in Section 10(b)(i) of this Agreement.

 

“ Other Investors ” has the meaning set forth in the recitals of this Agreement.

 

“ Participating Holder ” has the meaning set forth in Section 2(a)(iv) of this Agreement.

 

“ Permitted Transferee ” has the meaning set forth in Section 12 of this Agreement.

 

“ Person ” means any individual, corporation, limited liability company, partnership, joint venture, association, business trust, joint stock company, trust, unincorporated organization or other entity or government or agency or political subdivision thereof.

 

“ Primary Registration Statement ” has the meaning set forth in Section 2(b)(i) of this Agreement.

 

“ Prospectus ” means the prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

 

“ Purchased Shares ” has the meaning set forth in the recitals of this Agreement.

 

“ Purchaser ” has the meaning set forth in the preamble of this Agreement.

 

“ Reg Rights Claim ” has the meaning set forth in Section 10(b)(i) of this Agreement.

 

“ Reg Rights Indemnified Person ” has the meaning set forth in Section 10(b)(i) of this Agreement.

 

“ Reg Rights Indemnifying Person ” has the meaning set forth in Section 10(b)(i) of this Agreement.

 

“ Registration Rights Indemnitee ” has the meaning set forth in Section 10(a)(i) of this Agreement.

 

 

“ Registrable Securities ” means the Purchased Shares sold and delivered to the Purchaser pursuant to the Investment Agreement (as adjusted for stock splits, combinations, recapitalizations, exchange or readjustment of such shares after the date hereof); provided that any such shares will cease to be Registrable Securities when (i) they are sold pursuant to a Registration Statement (including a Primary Registration Statement or a Secondary Registration Statement) or (ii) they have otherwise been sold, transferred or disposed of by Purchaser other than to a Permitted Transferee.

 

“ Registration Expenses ” means (i) (whether or not any Registration Statement is declared effective or any of the transactions described herein is consummated) all expenses incurred by the Company in filing a Registration Statement, including, all registration and filing fees, fees and disbursements of counsel for the Company, SEC or FINRA registration and filing fees, all applicable ratings agency fees, expenses of the Company’s independent accountants in connection with any regular or special reviews or audits incident to or required by any such registration, fees and expenses of compliance with securities or “blue sky” Laws, listing application fees, printing, transfer agent’s and registrar’s fees, cost of distributing Prospectuses in preliminary and final form as well as any supplements thereto, the Company’s internal expenses, the expense of any annual audit or quarterly review, the expenses and fees for listing the securities to be registered on each securities exchange on which the Company’s Series C Stock is then listed and all other expenses incident to the registration of the Registrable Securities and (ii) the reasonable fees and disbursements of one counsel for Purchaser reasonably acceptable to Company (and the Company acknowledges that Willkie Farr & Gallagher LLP is and will be acceptable to the Company); provided , that the Company shall not be responsible for the reasonable fees and disbursements of more than one counsel for both Purchaser and any Other Investors named in any Registration Statement (such counsel to be selected by the Purchaser and such Other Investors and reasonably acceptable to the Company); and provided further , that the term “Registration Expenses” does not include, and the Company shall not be responsible for, Selling Expenses.

 

“ Registration Statement ” means a registration statement of the Company on an appropriate form under the Securities Act filed with the SEC covering the resale of Registrable Securities, including the Prospectus, amendments and supplements to such Registration Statement, including post-effective amendments, all exhibits and all materials incorporated by reference or deemed to be incorporated by reference in such Registration Statement.

 

“ Related Party ” and “ Related Parties ” have the meanings set forth in Section 24(b) of this Agreement.

 

“ Requesting Stockholders ” has the meaning set forth in Section 2(b)(ii) of this Agreement.

 

“ SEC ” means the Securities and Exchange Commission or any successor agency administering the Securities Act and the Exchange Act at the time.

 

“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

 

“Series C Stock ” has the meaning set forth in the recitals.

 

“ Selling Expenses ” means all underwriter discounts, selling commissions and stock transfer taxes applicable to the  sale of Registrable Securities.

 

“ settlement ” and “ settle ” have the meanings set forth in Section 10(c)(iv) of this Agreement.

 

“ Suspension Period ” has the meaning set forth in Section 4 of this Agreement.

 

“ Third-Party Reg Rights Claim ” an Action brought or threatened (whether orally or in writing) by a third party against any Reg Rights Indemnified Person.

 

“ Underwriter Cutback ” has the meaning set forth in Section 2(a)(iv) of this Agreement.

 

Section 2.                                            Registration Rights .

 

(a)                                  Demand Registrations .

 

(i)                                      Demand Registration Requests . Subject to the terms and conditions of this Agreement, at any time following the Closing Date, Purchaser may, by providing written notice to the Company (a “ Demand Registration Request ”), request to sell all or a portion of the Registrable Securities held by Purchaser pursuant to a Registration Statement in the manner specified in such notice, provided that the aggregate offering price for such Registrable Securities, as such amount is determined on the cover page of the Registration Statement, shall not be less than $100,000,000 (a “ Demand Registration ”).  Each Demand Registration Request shall specify the number of Registrable Securities intended to be offered and sold pursuant to the Demand Registration and the intended method of disposition thereof, including whether the registration requested is for an underwritten offering.  A Demand Registration shall be effected by way of a Registration Statement on Form S-3 or any similar short-form registration to the extent the Company is permitted to use such form at such time.  If the Company is then ASR Eligible, the Company shall use commercially reasonable best efforts to cause the Registration Statement to be an ASRS containing a Prospectus naming Purchaser as a selling shareholder and registering the offering and sale of the Registrable Securities by Purchaser on a delayed or continuous basis pursuant to Rule 415 (a “ Resale Shelf Registration Statement ”).  The Company shall use its commercially reasonable best efforts to cause any Registration Statement filed pursuant to this Section 2(a) to be declared effective by the SEC or otherwise become effective under the Securities Act as promptly as practicable after the filing thereof.

 

(ii)                                   Number of Demand Registrations .  Purchaser shall have the right to request a total of two (2) Demand Registrations pursuant to this Section 2(a); provided, that the Company shall not be obligated to effect more than one Registration Statement pursuant to this Section 2(a) (which, for the avoidance of doubt, shall not include any registration statement effected in response to any demand by one or more Other

 

 

Investors) in any one hundred eighty (180)-day period; provided, further , that such obligation shall be deemed satisfied only when a Registration Statement covering all shares of Registrable Securities specified in a Demand Registration Request shall have become effective and (A) if the method of disposition thereof is a firm commitment underwritten public offering, all such shares (less any reduced due to an Underwriter Cutback) shall have been sold pursuant thereto and (B) in any other case, such Registration Statement shall have remained effective for the Effectiveness Period.  Purchaser may revoke a request for a Demand Registration prior to the effective date of the corresponding Registration Statement ; provided , that such request shall count as one of Purchaser’s requests for a Demand Registration unless Purchaser reimburses the Company for all out-of-pocket expenses (including Registration Expenses) incurred by the Company relating to such Registration Statement; provided , further, if Purchaser notifies the Company in writing that it revokes its request for a Demand Registration within two (2) Business Days after notice in writing has been received by Purchaser that the number of Registrable Securities it has requested to be included in such Registration Statement is to be reduced pursuant to an Underwriter Cutback, (1) such request shall not count as one of its requests for a Demand Registration and (2) Purchaser will not be obligated to reimburse the Company for any of its out-of-pocket expenses relating to such Registration Statement, including Registration Expenses.

 

(iii)                                Selection of Underwriters.   If a Demand Registration is an underwritten offering, Purchaser shall have the right to select the investment banking firm(s) to act as the managing underwriter(s) in connection with such offering, subject to the approval of the Company (which approval shall not be unreasonably withheld, conditioned or delayed).

 

(iv)                               Inclusion of other Securities; Priority . The Company shall be entitled to include in any Registration Statement requested pursuant to this Section 2(a) shares of Common Stock to be sold by the Company for its own account. Each Other Investor, subject to the prior consent of Purchaser, shall be  permitted to include shares of Series C Stock in any Demand Registration (any such Other Investor, a “ Participating Holder ”). If a Demand Registration is an underwritten offering, then the Company and each Participating Holder whose shares are included in the Registration Statement must sell such shares in such underwritten offering, and each Participating Holder must agree to sell its shares pursuant to an underwriting agreement on the same terms and conditions as Purchaser. In the event the managing underwriter shall be of the opinion that the number of shares requested to be included in an underwritten offering would adversely affect the marketing of such offering (including the price at which shares may be sold), then the number of shares to be included in such underwritten offering will be reduced (an “ Underwriter Cutback ”), with the shares to be included in such offering based on the following priority: (i) first, the number of Registrable Securities requested to be included by Purchaser, up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold); (ii) second, in addition to shares included pursuant to the preceding clause (i), the number of shares of Common Stock requested to be included by the Company up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold); and

 

 

(iii) third, in addition to shares included pursuant to the preceding clauses (i) and (ii), the number of shares requested to be included by each Participating Holder, on a pro rata basis (based on the number of shares of Series C Stock owned by each Participating Holder) up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold).

 

(v)                                  Resale Shelf Registration Statement.

 

(i)                                      The Company hereby represents that, as of the date hereof,  it is a Well-Known Seasoned Issuer (have the meaning given thereto pursuant to Rule 405 promulgated under the Securities Act) and eligible to use Form S-3.  The Company shall use its commercially reasonable best efforts to continue to be ASR Eligible during the term of this Agreement.

 

(ii)                                   After the effectiveness of any Resale Shelf Registration Statement, upon the request of a Permitted Transferee, the Company shall promptly update the applicable information in the existing Resale Shelf Registration Statement by post-effective amendment or prospectus supplement thereto in order to permit such Permitted Transferee to sell the Registrable Securities held by such Permitted Transferee thereunder.

 

(b)                                  Piggyback Registrations .

 

(i)                                      Primary Piggyback Registration; Priority . Subject to the terms and conditions of this Agreement, if the Company at any time following the Closing Date proposes to file a registration statement (a “ Primary Registration Statement ”) for the primary sale of Common Stock under the Securities Act (except with respect to registration statements on Forms S-4, S-8 or another form not available for registering the Registrable Securities for sale to the public), it will give prompt written notice to Purchaser (and the Other Investors) of its intention to do so (such notice to be given not less than ten (10) Business Days prior to the anticipated filing date of the Primary Registration Statement).  Upon the written request of Purchaser, received by the Company within five (5) Business Days after the giving of such notice by the Company, to include Registrable Securities in a Primary Registration Statement, the Company will use commercially reasonable best efforts to cause the Registrable Securities as to which inclusion shall have been so requested to be included in the Primary Registration Statement. Purchaser shall be entitled to sell the Registrable Securities included in a Primary Registration Statement in accordance with the method of distribution requested by Purchaser; provided , if the Primary Registration Statement relates to an underwritten offering, then (i) the Company shall be entitled to select the underwriters in its sole discretion and (ii) Purchaser must sell all Registrable Securities included on the Primary Registration Statement in such underwritten offering pursuant to an underwriting agreement containing terms and conditions that are customary for secondary offerings.  In the case of an underwritten offering, if the managing underwriter shall be of the opinion that an Underwriter Cutback is required, then the shares to be included in such underwritten offering will be based on the following priority: (i) first, the number of

 

 

shares of Common Stock the Company seeks to include, up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold); (ii) second, in addition to shares included pursuant to the preceding clause (i), the number of Registrable Securities and other shares of Series C Stock requested to be included by Purchaser and any Other Investor, on a pro rata basis (based on the number of shares of Series C Stock owned by the Purchaser and the Other Investor(s) and purchased pursuant to the Investment Agreement and the Other Investment Agreements, respectively), up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold); and (iii) third, in addition to shares included pursuant to the preceding clauses (i) and (ii), the number of shares sought to be included by any other Person(s) in the underwritten offering with the permission of the Company, up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold). The Company may withdraw a Primary Registration Statement prior to its being declared effective without  incurring any Liability to Purchaser, and shall not be required to keep a Primary Registration Statement effective for longer than the period contemplated by the intended manner of distribution for the shares to be sold by the Company described in the Prospectus included in the Primary Registration Statement.

 

(ii)                                   Secondary Piggyback Registration; Priority . Subject to the terms and conditions of this Agreement, if the Company at any time following the Closing Date proposes to file a registration statement (a “ Secondary Registration Statement ”) for the secondary sale of Common Stock under the Securities Act on behalf of one or more selling stockholders of the Company (the “ Requesting Stockholders ”), the Company will give prompt written notice to Purchaser of its intention to do so (such notice to be given not less than ten (10) Business Days prior to the anticipated filing date of the Secondary Registration Statement) provided , that Purchaser shall not be entitled to include any Registrable Securities on a Secondary Registration Statement to be filed at the request of an Other Investor without the prior written consent of such Other Investor.  Upon the written request of Purchaser, received by the Company within five (5) Business Days after the giving of such notice by the Company, to include Registrable Securities in a Secondary Registration Statement, the Company will use commercially reasonable best efforts to cause the Registrable Securities as to which inclusion shall have been so requested to be included in the Secondary Registration Statement. Purchaser shall be entitled to sell the Registrable Securities included in a Secondary Registration Statement in accordance with the method of distribution requested by Purchaser; provided , if the Secondary Registration Statement relates to an underwritten offering, then (i) the Requesting Stockholders (or the Company) shall be entitled to select the underwriters and (ii) Purchaser must sell all Registrable Securities included on the Secondary Registration Statement in such underwritten offering pursuant to an underwriting agreement on the same terms and conditions as those applicable to the Requesting Stockholders. In the case of an underwritten offering, if the managing underwriter shall be of the opinion that an Underwriter Cutback is required, then the shares to be included in such underwritten offering will be based on the following priority: (i) first, the number of shares of Common Stock the Requesting Stockholders seek to include, up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the

 

 

offering (including the price at which shares may be sold); (ii) second, in addition to shares included pursuant to the preceding clause (i), the number of shares sought to be included by the Company up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering  (including the price at which shares may be sold); (iii) third, in addition to shares included pursuant to the preceding clauses (i) and (ii), the number of shares requested to be included by Purchaser and any Other Investors (that are not also Requesting Stockholders), on a pro rata basis (based on the number of shares of Series C Stock owned by Purchaser and such Other Investor(s) and purchased pursuant to the Investment Agreement and the Other Investment Agreements, respectively) up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold); and (iv) fourth, in addition to shares included pursuant to the preceding clauses (i), (ii) and (iii), the number of shares sought to be included by any other Persons permitted to participate in the underwritten offering, up to the number that, in the opinion of the managing underwriter, would not adversely affect the marketing of the offering (including the price at which shares may be sold).  The Requesting Stockholders or the Company may withdraw a Secondary Registration Statement prior to its being declared effective without incurring any Liability to Purchaser, and the Company shall not be required to keep a Secondary Registration Statement effective for longer than the period contemplated by the intended manner of distribution for the sale of shares by the Requesting Stockholders described in the Prospectus included in the Secondary Registration Statement.

 

Section 3.                                            Expenses .

 

Except as specifically provided herein, all Registration Expenses incurred in connection with the registration of the Registrable Securities shall be borne by the Company, and all Selling Expenses shall be borne by Purchaser.

 

Section 4.                                            Suspensions .

 

Notwithstanding anything to the contrary contained in this Agreement, the Company shall be entitled, by providing written notice to Purchaser, to delay the filing or effectiveness of a Registration Statement or require Purchaser to suspend the use of the Prospectus for sales of Registrable Securities under an effective Registration Statement for a reasonable period of time not to exceed one hundred twenty (120) consecutive days or one hundred eighty (180) days in the aggregate in any twelve (12)-month period (a “ Suspension Period ”), if the Board of Directors of the Company (or the executive committee thereof) determines in good faith that such filing, effectiveness or use would (A) require the public disclosure of material non-public information concerning any transaction or negotiations involving the Company that would interfere with such transaction or negotiations or (B) otherwise interfere with financing plans, acquisition activities or business activities of the Company, provided , that, if at the time of receipt of such notice Purchaser shall have sold Registrable Securities (or have signed a firm commitment underwriting agreement with respect to the purchase of such shares) pursuant to an effective Registration Statement and the reason for the Suspension Period is not of a nature that would require a post-effective amendment to the Registration Statement, then the Company shall use its commercially reasonable best efforts to

 

 

take such action as to eliminate any restriction imposed by federal securities Laws on the timely delivery of such shares.  Immediately upon receipt of such notice, Purchaser shall discontinue the disposition of Registrable Securities under an effective Registration Statement and Prospectus relating thereto until such Suspension Period is terminated.  The Company agrees that it will terminate any such Suspension Period as promptly as reasonably practicable and will promptly notify Purchaser of such termination.  After the expiration of any Suspension Period in the case of an effective Registration Statement, and without any further request from Purchaser, the Company shall as promptly as reasonably practicable prepare a post-effective amendment or supplement to the Registration Statement or the Prospectus, or any document incorporated therein by reference, or file any other required document so that, as thereafter delivered to purchasers of the Registrable Securities included therein, the Prospectus will not include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. If a Suspension Period occurs during the Effectiveness Period for a Registration Statement, such Effectiveness Period shall be extended for a number of days equal to the total number of days during which the distribution of Registrable Securities is suspended under this Section 4. If the Company notifies Purchaser of a Suspension Period with respect to a Registration Statement requested pursuant to Section 2(a) that has not yet been filed or declared effective, (A) Purchaser may by notice to the Company withdraw such request without such request counting as a Demand Request and (B) Purchaser will be not obligated to reimburse the Company for any of its out-of-pocket expenses, including Registration Expenses.

 

Section 5.                                            Procedures for Registration .

 

If and whenever the Company is required by the provisions of Sections 2(a) or 2(b) to use commercially reasonable best efforts to effect the registration of any Registrable Securities under the Securities Act, the Company will, as expeditiously as possible:

 

(a)                                  Prepare and promptly file with the SEC a Registration Statement with respect to such securities and use commercially reasonable best efforts to cause such Registration Statement to become effective as soon as practicable thereafter and remain effective for the period of the distribution contemplated thereby (but in no event longer than the Effectiveness Period) and before filing a Registration Statement or Prospectus or any amendments or supplements thereto, furnish to the Purchaser and the underwriter or underwriters, if any, copies of all such documents proposed to be filed, and Purchaser shall have the opportunity to object to any information pertaining to Purchaser that is contained therein;

 

(b)                                  Prepare and file with the SEC such amendments and supplements to such Registration Statement and the Prospectus used in connection therewith as may be necessary to keep such Registration Statement effective for the period specified in paragraph (a) above and comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities covered by such Registration Statement in accordance with Purchaser’s intended method of disposition set forth in such Registration Statement for such period;

 

(c)                                   Furnish to Purchaser and any underwriters (without charge) such number of copies of the Registration Statement, each amendment and supplement thereto, the Prospectus included therein (including each preliminary prospectus) as such Persons reasonably may request

 

 

in order to facilitate the public sale or other disposition of the Registrable Securities covered by such Registration Statement;

 

(d)                                  Use commercially reasonable best efforts to register or qualify the Registrable Securities covered by such Registration Statement under the securities or “blue sky” Laws of such jurisdictions as Purchaser or, in the case of an underwritten public offering, the managing underwriter reasonably shall request and do any and all other acts and things which may be reasonably necessary or advisable to enable Purchaser to consummate the disposition in such jurisdictions of the Registrable Securities owned by such seller; provided, however , that the Company shall not for any such purpose be required to qualify generally to transact business as a foreign corporation in any jurisdiction where it is not so qualified or to consent to general service of process in any such jurisdiction;

 

(e)                                   Use commercially reasonable best efforts to list the Registrable Securities covered by such Registration Statement with any securities exchange on which the Series C Stock is then listed or, if such Registrable Securities are not then listed with a securities exchange, on a national securities exchange selected by the Company;

 

(f)                                    Provide a transfer agent and registrar for all such Registrable Securities not later than the effective date of such Registration Statement;

 

(g)                                   Immediately notify Purchaser, at any time when a Prospectus is required to be delivered under the Securities Act, of the occurrence or happening of any event as a result of which the Prospectus contained in a Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and at the request of Purchaser prepare and furnish to Purchaser a reasonable number of copies of a supplement to or an amendment of such Prospectus as may be necessary so that, as thereafter delivered, such Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing;

 

(h)                                  If the offering is underwritten and at the request of Purchaser, (x) enter into such customary agreements (including underwriting agreements in customary form) and take all such other actions as Purchaser reasonably requests in order to expedite or facilitate the disposition of such Registrable Securities (including making executive officers of the Company available, on reasonable advance notice, to participate in, and cause them to cooperate with the underwriters in connection with, one “road-show” per underwritten offering and underwriter due diligence calls and (y) use commercially reasonable best efforts to furnish on the date that Registrable Securities are delivered to the underwriters for sale: (A) an opinion of counsel to the Company, dated such date, addressed to the underwriters and to Purchaser, covering such matters as are typically included in an opinion to underwriters for a comparable secondary transaction, including, without limitation, stating that such Registration Statement has become effective under the Securities Act and that (1) to the knowledge of such counsel, no stop order suspending the effectiveness thereof has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the Securities Act and (2) the Registration Statement, the related Prospectus and each amendment or supplement thereof comply as to form in all material

 

 

respects with the requirements of the Securities Act (except that such counsel need not express any opinion as to financial statements or financial or statistical data contained therein) and (B) a letter dated such date from the independent public accountants retained by the Company (and brought down to the closing under the underwriting agreement), addressed to the underwriters and to Purchaser, stating that they are independent public accountants within the meaning of the Securities Act and the applicable rules and regulations adopted by the SEC thereunder, and otherwise in customary form and covering such financial and accounting matters as are customarily covered by letters of the independent certified public accountants delivered in connection with a comparable secondary transaction, including, without limitation, that, in the opinion of such accountants, the financial statements of the Company included in the Registration Statement or the Prospectus, or any amendment or supplement thereof, comply as to form in all material respects with the applicable accounting requirements of the Securities Act, and such letter shall additionally cover such other financial matters (including information as to the period ending no more than five (5) Business Days prior to the date of such letter) with respect to such registration as such underwriters or Purchaser may reasonably may request;

 

(i)                                      Use commercially reasonable best efforts to cooperate with Purchaser in the disposition of the Registrable Securities covered by such Registration Statement;

 

(j)                                     In connection with the preparation and filing of each Registration Statement registering Registrable Securities under the Securities Act, and before filing any such Registration Statement or any other document in connection therewith, give reasonable consideration to the inclusion in such documents of any comments reasonably and timely made by Purchaser or its legal counsel; participate in and make documents available for the reasonable and customary due diligence review of underwriters during normal business hours, on reasonable advance notice and without undue burden or hardship on the Company; provided that (A) any party receiving confidential materials shall execute a confidentiality agreement on customary terms if reasonably requested by the Company and (B) the Company may in its sole discretion restrict access to competitively sensitive or legally privileged documents or information;

 

(k)                                  Cooperate with Purchaser and each underwriter participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with FINRA;

 

(l)                                      Use its commercially reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of a Registration Statement, or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to use reasonable efforts to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify Purchaser of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose; and

 

(m)                              Otherwise use commercially reasonable best efforts to comply with the Securities Act, the Exchange Act and any other applicable rules and regulations of the SEC and reasonably cooperate with Purchaser in the disposition of its Registrable Securities in accordance with the method of distribution described in the Prospectus included in any Registration Statement.  Such cooperation shall include the endorsement and transfer of any certificates representing

 

 

Registrable Shares (or a book-entry transfer to similar effect) transferred in accordance with this Agreement.

 

For purposes of Section 5(a), the period of distribution of Registrable Securities in a firm commitment underwritten public offering shall be deemed to extend until each underwriter participating in the offering has completed the distribution of all securities purchased by it, and the period of distribution of Registrable Securities pursuant to a Registration Statement for any other manner of distribution shall be deemed to extend until the earlier of the sale of all Registrable Securities covered thereby and ninety (90) days after the effective date thereof (such period, including any extension pursuant to Section 4 or Section 7 of this Agreement, the “ Effectiveness Period ”).

 

Section 6.                                            Earnings Statement .

 

The Company will use commercially reasonable best efforts to make available to its security holders, as promptly as reasonably practicable, an earnings statement (which need not be audited) covering the period of twelve (12) months commencing upon the first disposition of Registrable Securities pursuant to a Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 of the SEC promulgated thereunder.

 

Section 7.                                            Suspension of Sales .

 

Upon receipt of notice from the Company pursuant to Section 5(g), Purchaser shall immediately discontinue disposition of Registrable Securities pursuant to the applicable Registration Statement and Prospectus relating thereto until Purchaser (i) has received copies of a supplemented or amended Prospectus or prospectus supplement pursuant to Section 5(g) or (ii) is advised in writing by the Company that the use of the Prospectus and, if applicable, prospectus supplement may be resumed, and, if so directed by the Company, Purchaser shall deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in Purchaser’s possession, of the Prospectus and, if applicable, prospectus supplement covering such Registrable Securities current at the time of receipt of such notice.  If the Company shall give such notice with regards to any Registration Statement requested pursuant to Section 2(a), the Effectiveness Period in respect of such Registration Statement shall be extended by the number of days during the period from and including the date such notice is given by the Company to the date when the Company shall have (1) made available to Purchaser a supplemented or amended Prospectus or prospectus supplement pursuant to Section 5(g) or (2) advised Purchaser in writing that the use of the Prospectus and, if applicable, prospectus supplement may be resumed.

 

Section 8.                                            Free Writing Prospectuses .

 

Purchaser shall not use any Free Writing Prospectus in connection with the sale of Registrable Securities without the prior written consent of the Company.

 

 

Section 9.                                            Information .

 

It shall be a condition precedent to the Company’s obligation to file a Registration Statement or any prospectus supplement with the SEC that Purchaser shall first furnish to the Company such information regarding Purchaser, the Registrable Securities held by it, the intended method of disposition of such securities and such further information as shall be required to effect the registered offering of the Registrable Securities under the Securities Act and to assure compliance with federal and applicable state securities Laws.

 

Section 10.                                     Indemnification .

 

(a)                                  Indemnification Rights .

 

(i)                                      The Company shall indemnify and hold harmless Purchaser and each Person, if any, that controls Purchaser within the meaning of the Section 15 of the Securities Act (each a “ controlling person ”) and the respective officers, directors, stockholders, partners, members and Affiliates of Purchaser and each controlling person (each, a “ Registration Rights Indemnitee ”), to the fullest extent lawful, from and against any and all Damages, directly or indirectly caused by, relating to, arising out of, based upon or in connection with (A) any untrue statement of material fact contained in any Disclosure Package, any Registration Statement, any Prospectus (including any preliminary Prospectus), any Free Writing Prospectus, or in any amendment or supplement thereto, or (B) any omission or alleged omission to state in any Disclosure Package, any Registration Statement, any Prospectus (including any preliminary Prospectus), any Free Writing Prospectus, or in any amendment or supplement thereto, any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided , that the Company shall not be liable to such Registration Rights Indemnitee to the extent that any such Damages are directly caused by an untrue statement or omission made in such Disclosure Package, Registration Statement, Prospectus (including any preliminary Prospectus), Free Writing Prospectus, or any amendment or supplement thereto, in reliance upon and in conformity with written information furnished to the Company by or on behalf of Purchaser and approved expressly for use therein. This indemnity agreement shall be in addition to any Liability which the Company may otherwise have.

 

(ii)                                   Purchaser agrees to indemnify the Company and its officers and directors and each Person, if any, that controls the Company (each, a “ Company Registration Rights Indemnitee ”), against any and all Damages directly caused by any untrue statement of material fact contained in any Disclosure Package, any Registration Statement, any Prospectus (including any preliminary Prospectus), any Free Writing Prospectus or any amendments or supplements thereto or any omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made not misleading, in each case, to the extent that such untrue statement or omission was made in reliance upon and in conformity with written information furnished to the Company by or on behalf of Purchaser expressly for use therein.

 

 

(iii)                                If the indemnification provided for in Section 10(a)(i) or (ii) is unavailable to a Registration Rights Indemnitee or a Company Registration Rights Indemnitee, as applicable, with respect to any Damages referred to therein or is unenforceable or insufficient to hold the Registration Rights Indemnitee or Company Registration Rights Indemnitee, as applicable, harmless as contemplated therein, then the Company or Purchaser, as applicable, in lieu of indemnifying such Registration Rights Indemnitee or Company Registration Rights Indemnitee, as applicable, shall contribute to the amount paid or payable by such Registration Rights Indemnitee or Company Registration Rights Indemnitee, as applicable, as a result of such Damages in such proportion as is appropriate to reflect the relative fault of the Registration Rights Indemnitee or the Company Registration Rights Indemnitee, as applicable, on the one hand, and the Company or Purchaser, as applicable, on the other hand, in connection with the statements or omissions which resulted in such Damages as well as any other relevant equitable considerations. The relative fault of the Company or Purchaser, as applicable, on the one hand, and of the Registration Rights Indemnitee or Company Registration Rights Indemnitee, as applicable, on the other hand, shall be determined by reference to, among other factors, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by or on behalf of the Company or by or on behalf of the Purchaser, as applicable, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission; the Company and Purchaser agree that it would not be just and equitable if contribution pursuant to this Section 10(a)(iii) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in this Section 10(a)(iii).  No Registration Rights Indemnitee or Company Registration Rights Indemnitee guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from the Company or Purchaser, as applicable, if the Company or Purchaser, as applicable, was not guilty of such fraudulent misrepresentation. Notwithstanding anything herein to the contrary, in no event shall the liability of Purchaser be greater in amount than the amount of net proceeds received by Purchaser upon such sale or the amount for which such indemnifying party would have been obligated to pay by way of indemnification if the indemnification provided for under Section 10(a)(i) or 10(a)(ii) hereof had been available under the circumstances.

 

(b)                                  Notice of Reg Rights Claim .

 

(i)                                      As used in this Agreement, the term “ Reg Rights Claim ” means a claim for indemnification by any Company Registration Rights Indemnitee or any Registration Rights Indemnitee, as the case may be, for Damages under Section 10(a) (such Person making a Reg Rights Claim, “ Reg Rights Indemnified Person ”).  A Company Registration Rights Indemnitee or a Registration Rights Indemnitee shall give notice of a Reg Rights Claim under this Agreement (and in the case of a Registration Rights Indemnitee whether for its own Damages or for Damages incurred by any other Registration Rights Indemnitee) pursuant to a written notice of such Reg Rights Claim executed by the Company or Purchaser, as applicable (a “ Notice of Reg Rights Claim ”), and delivered to the other of them (such receiving party, the “ Reg Rights Indemnifying Person ”), within twenty (20) days after such Reg Rights Indemnified Person becomes

 

 

aware of the existence of any potential claim by such Reg Rights Indemnified Person for indemnification under Section 10(b), arising out of or resulting from any item indemnified pursuant to the terms of Section 10(a)(i) or Section 10(a)(ii); provided , that, the failure to timely give such notice shall not limit or reduce the Reg Rights Indemnified Person’s right to indemnification hereunder unless (and then only to the extent that) the Reg Rights Indemnifying Person’s defense of such Reg Rights Claim is materially and adversely prejudiced thereby.

 

(ii)                                   Each Notice of Reg Rights Claim shall: (A) state that the Reg Rights Indemnified Person has incurred or paid Damages in an aggregate stated amount (where practicable) arising from such Reg Rights Claim (which amount may be the amount of damages claimed by a third party in an Action brought against any Reg Rights Indemnified Person based on alleged facts, which if true, would give rise to Liability for Damages to such Reg Rights Indemnified Person under Section 10(a)); and (B) contain a brief description, in reasonable detail (to the extent reasonably available to the Reg Rights Indemnified Person), of the facts, circumstances or events giving rise to the alleged Damages based on the Reg Rights Indemnified Person’s good faith belief and knowledge thereof, including the identity and address of any third party claimant (to the extent reasonably available to the Reg Rights Indemnified Person).

 

(iii)                                Following delivery of the Notice of Reg Rights Claim (or at the same time if the Reg Rights Indemnified Person so elects) the Reg Rights Indemnified Person shall deliver copies of any demand or complaint, the amount of Damages, the date each such item was incurred or paid, or the basis for such anticipated Liability, and the specific nature of the breach to which such item is related.

 

(c)                                   Defense of Third Party Reg Rights Claims .

 

(i)                                      Subject to the provisions hereof, the Reg Rights Indemnifying Person on behalf of the Reg Rights Indemnified Person shall have the right to elect to defend and control the defense of any Third-Party Reg Rights Claim, and, as provided by Section 10(d), the costs and expenses incurred by the Reg Rights Indemnifying Person in connection with such defense (including reasonable attorneys’ fees, other professionals’ and experts’ fees and court or arbitration costs) shall be paid by the Reg Rights Indemnifying Person.  The Reg Rights Indemnified Person (unless itself controlling the Third-Party Reg Rights Claim in accordance with this Section 10(c)) may participate, through counsel of its own choice and, except as provided herein, at its own expense, in the defense of any Third Party Reg Rights Claim.

 

(ii)                                   The Reg Rights Indemnifying Person shall be entitled to assume the control and defense thereof utilizing legal counsel reasonably acceptable to the Reg Rights Indemnified Person; provided, that the Reg Rights Indemnifying Person shall not be entitled to assume control of such defense if (A) the claim for indemnification relates to or arises in connection with any criminal or governmental proceeding, action, indictment, allegation or investigation, (B) the claim seeks an injunction against the Reg Rights Indemnified Person, to the extent that such defense relates to the claim for such injunction,(C) a conflict of interest between the Reg Rights Indemnifying Person and the

 

 

Reg Rights Indemnified Person exists with respect to such claim, in the opinion of counsel to such Reg Rights Indemnifying Person or (D) the Reg Rights Indemnifying Person has elected to have the Reg Rights Indemnified Person defend, or assume the control and defense of, a Third-Party Reg Rights Claim in accordance with this Section 10(c).

 

(iii)                                Any party controlling the defense of any Third-Party Reg Rights Claim pursuant hereto shall: (A) conduct the defense of such Third-Party Reg Rights Claim with reasonable diligence and keep the other parties reasonably informed of material developments in the Third-Party Reg Rights Claim at all stages thereof; (B) as promptly as reasonably practicable, submit to the other parties copies of all pleadings, responsive pleadings, motions and other similar legal documents and papers received or filed in connection therewith; (C) permit the other parties and their counsel to confer on the conduct of the defense thereof; and (D) permit the other parties and their counsel an opportunity to review all legal papers to be submitted prior to their submission.  The Company and Purchaser will render to the other party such assistance as may be reasonably required in order to insure the proper and adequate defense thereof and shall furnish such records, information and testimony and attend such conferences, discovery proceedings, hearings, trials and appeals as may be reasonably requested by the other party in connection therewith; provided, however , that notwithstanding anything to the contrary in this Agreement, no party shall be required to disclose any information to the other party or its counsel, accountants or representatives, if doing so would be reasonably expected to violate any Law to which such Person is subject or could jeopardize (in the reasonable discretion of the disclosing party) any attorney-client privilege available with respect to such information.

 

(iv)                               If the Reg Rights Indemnifying Person controls the defense of and defends any Third-Party Reg Rights Claim under this Section 10(c), the Reg Rights Indemnifying Person shall have the right to effect a settlement of such Third-Party Reg Rights Claim on the Reg Rights Indemnified Person’s behalf without the consent of the Reg Rights Indemnified Person; provided , that (A) such settlement does not involve any injunctive relief binding upon the Reg Rights Indemnified Person or any of its Affiliates, and (B) such settlement expressly and unconditionally releases the Reg Rights Indemnified Person and the other applicable Reg Rights Indemnified Persons (that is, each of the Company Registration Rights Indemnitees, if the Reg Rights Indemnified Person is a Company Registration Rights Indemnitee, and each of the Registration Rights Indemnitees, if the Reg Rights Indemnified Person is a Registration Rights Indemnitee) from all Liabilities with respect to such Third-Party Reg Rights Claim, without prejudice.  If the Reg Rights Indemnified Person controls the defense of and defends any Third-Party Reg Rights Claim under this Section 10(c), the Reg Rights Indemnified Person shall have the right to effect a settlement of such Third-Party Reg Rights Claim with the consent of the Reg Rights Indemnifying Person (which consent shall not be unreasonably withheld, conditioned or delayed).  No settlement by the Reg Rights Indemnified Person of such Third-Party Reg Rights Claim shall limit or reduce the right of any Reg Rights Indemnified Person to indemnity hereunder for all Damages they may incur arising out of or resulting from the Third-Party Reg Rights Claim to the extent indemnified in Section 10(c); provided , that such settlement is effected in accordance with this Section 10(c).  As

 

 

used in this Section 10(c)(iv), the term “ settlement ” refers to any consensual resolution of the claim in question, including by consent, decree or by permitting any judgment or other resolution of a claim to occur without disputing the same, and the term “ settle ” has a corresponding meaning.

 

(d)                                  Resolution of Claims .  Each Notice of Reg Rights Claim given by Reg Rights Indemnified Person shall be resolved as follows:

 

(i)                                      Admitted Claims .  If, within twenty (20) Business Days after a Notice of Reg Rights Claim is delivered to the Reg Rights Indemnifying Person, the Reg Rights Indemnifying Person agrees in writing that Liability for such Claim is indemnified under Section 10(a)(i) or Section 10(a)(ii), as applicable, the full amount of the Damages specified in the Notice of Reg Rights Claim is agreed to, and that such Notice of Reg Rights Claim is timely, the Reg Rights Indemnifying Person shall be conclusively deemed to have consented to the recovery by the Reg Rights Indemnified Person of the full amount of Damages specified in the Notice of Reg Rights Claim; provided, that , to the extent the full amount of Damages is not known at the time such Notice of Reg Rights Claim is delivered, payment by the Reg Rights Indemnifying Person under this Section 10(d) with respect to any speculative Damages shall not be due until the actual amount of such Damages is known.

 

(ii)                                   Contested Claims .  If the Reg Rights Indemnifying Person does not so agree in writing to such Notice of Reg Rights Claim or gives the Reg Rights Indemnified Person written notice contesting all or any portion of a Notice of Reg Rights Claim (a “ Contested Claim ”) within the twenty (20) Business Day period specified in Section 10(b)(i), then such Contested Claim shall be resolved by a written settlement agreement executed by the Company and Purchaser.

 

Section 11.                                     Rule 144 .

 

(i)                                      To the extent that Registrable Securities are tradable without restriction pursuant to Rule 144 of the Securities Act, the Company will cause the removal of any restrictive legends from such Registrable Securities.

 

(ii)                                   With a view to making available to Purchaser the benefits of certain rules and regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, the Company agrees to use its commercially reasonable best efforts to: (A) make and keep public information available, as those terms are understood and defined in Rule 144 under the Securities Act or any similar or analogous rule promulgated under the Securities Act, at all times after the Closing Date; (B) file with the SEC, in a timely manner, all reports and other documents required of the Company under the Exchange Act; and (C) so long as Purchaser owns any Registrable Securities, furnish to Purchaser forthwith upon request: a written statement by the Company as to its compliance with the reporting requirements of Rule 144 under the Securities Act, and of the Exchange Act; a copy of the most recent annual or quarterly report of the Company; and such other reports and documents as Purchaser may reasonably request in availing

 

 

itself of any rule or regulation of the SEC allowing it to sell any Registrable Securities without registration.

 

(iii)                                For the avoidance of doubt, Purchaser may sell Registrable Shares in compliance with Rule 144, regardless of whether a Registration Statement has been filed with the SEC or is effective.

 

Section 12.                                     Assignment .                               This Agreement shall be binding upon, shall inure to the benefit of, and shall be enforceable by the parties hereto and their respective successors and permitted assigns. The Company shall not assign this Agreement, nor any right or obligation hereunder, without the prior written consent of Purchaser.  Purchaser shall not assign this Agreement, nor any right, benefit, remedy or obligation hereunder, without the prior written consent of the Company, except that Purchaser shall be permitted, without the consent of Company, to assign its rights and obligations hereunder to any Person to which Purchaser sells or otherwise transfers 2,223,013 or more Registrable Securities (each, a “ Permitted Transferee ”); provided , that a Permitted Transferee shall execute and deliver to the Company a counterpart to this Agreement in the form attached hereto as Exhibit A.   Upon execution and delivery of such counterpart, the Permitted Transferee shall have the same rights and benefits of, and shall be subject to the same restrictions contained in, this Agreement as those applicable to Purchaser at the time of such execution and delivery.  If Purchaser continues to own Registrable Securities following a Permitted Transferee becoming a party to this Agreement, then Purchaser and such Permitted Transferee shall have no greater rights collectively than Purchaser has individually pursuant to this Agreement.

 

Section 13.                                     Entire Agreement .

 

This Agreement, together with the Investment Agreement, constitutes the entire agreement between the parties hereto with respect to the registration rights to be provided to Purchaser in accordance with the Investment Agreement and supersedes any prior understandings, agreements or representations by or among the parties hereto, or any of them, written or oral, in each case, with respect to the subject matter hereof.

 

Section 14.                                     Termination .

 

This Agreement (other than Section 3, Section 10 and Section 11) will terminate on the date on which all Purchased Shares subject to the Investment Agreement cease to be Registrable Securities.

 

Section 15.                                     Notices .

 

Any notices or other communications required or permitted under, or otherwise in connection with this Agreement, shall be in writing and shall be deemed to have been duly given (A) when delivered in person, (B) upon transmission when sent by facsimile transmission with written confirmation of receipt, (C) upon transmission by electronic mail (but only if followed by transmittal of a copy thereof by (x) national overnight courier or (y) hand delivery with receipt, in each case, for delivery by the second (2nd) Business Day following such electronic mail), (D) on receipt after dispatch by registered or certified mail, postage prepaid and addressed, or (E) on the next Business Day if transmitted by national overnight courier, in each case as follows:

 

 

If to the Company:

 

Liberty Broadband Corporation

12300 Liberty Boulevard

Englewood, CO 80112

Attention:                  Richard N. Baer

Facsimile:                  (720) 875-5401

E-mail:                                 legalnotices@libertymedia.com

 

with a copy (which shall not constitute notice) to:

 

Baker Botts L.L.P.

30 Rockefeller Plaza

New York, NY  10112

Attention:                  Frederick McGrath

Renee L. Wilm

Facsimile:                  (212) 259-2500

E-mail:                                 frederick.mcgrath@bakerbotts.com

renee.wilm@bakerbotts.com

 

If to Purchaser:

 

Quantum Partners LP

c/o Soros Fund Management LLC

250 West 55 th  Street

New York, New York 10019

Attention:                  Jay A. Schoenfarber

Facsimile:                  646-731-5584

Email:                                     Jay.Schoenfarber@soros.com

 

with a copy (which shall not constitute notice) to:

 

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, New York 10019

Attention:                  Serge Benchetrit, Esq.

Adam M. Turteltaub, Esq.

Facsimile:                  212-728-8111

Email:                                     sbenchetrit@willkie.com

aturteltaub@willkie.com

 

Section 16.                                     Governing Law .

 

This Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware, without giving effect to any choice of Law or conflict of Law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the Law of any jurisdiction other than the State of Delaware.

 

 

Section 17.                                     Jurisdiction and Venue .

 

The parties hereto hereby irrevocably submit to the jurisdiction of the Delaware Court of Chancery or, in the event (but only in the event) that such court does not have subject matter jurisdiction over such action or proceeding, in the United States District Court for the District of Delaware in respect of the interpretation and enforcement of the provisions of this Agreement and of the documents referred to in this Agreement, and in respect of the transactions contemplated hereby, and hereby waive, and agree not to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement hereof or of any such document, that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in the Delaware Court of Chancery, or in the event (but only in the event) that such court does not have subject matter jurisdiction over such action or proceeding, in the United States District Court for the District of Delaware, or that this Agreement or any such document may not be enforced in or by such courts, and the parties hereto irrevocably agree that all claims with respect to such action or proceeding shall be heard and determined in the Delaware Court of Chancery, or in the event (but only in the event) that such court does not have subject matter jurisdiction over such action or proceeding, in the United States District Court for the District of Delaware. The parties hereto hereby consent to and grant the Delaware Court of Chancery, or in the event (but only in the event) that such court does not have subject matter jurisdiction over such action or proceeding, the United States District Court for the District of Delaware, jurisdiction over the person of such parties and, to the extent permitted by Law, over the subject matter of such dispute and agree that mailing of process or other papers in connection with any such action or proceeding in the manner provided in this Agreement or in such other manner as may be permitted by Law shall be valid and sufficient service thereof. EACH OF THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHTS TO TRIAL BY JURY IN CONNECTION WITH ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH PARTY ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (II) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (III) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (IV) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND ACKNOWLEDGMENTS IN THIS SECTION 17.

 

Section 18.                                     Counterparts and Signature .

 

This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the parties hereto and delivered to the other parties, it being understood that all parties need not sign the same counterpart.  This Agreement may be executed and delivered by facsimile or electronic mail transmission.

 

 

Section 19.                                     Amendments and Waivers .

 

(a)                                  No failure or delay on the part of the Company or Purchaser in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

 

(b)                                  The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless consented to in writing by the party against whom it shall be enforced.

 

Section 20.                                     Interpretation .

 

When reference is made in this Agreement to a Section, such reference shall be to a Section of this Agreement, unless otherwise indicated.  The headings contained in this Agreement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.  The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party.  Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural, and vice versa.  Any reference to any federal, state, local or foreign statute or Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise.  Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”

 

Section 21.                                     No Third-Party Beneficiaries .

 

This Agreement is not intended, and shall not be deemed, to confer any rights or remedies upon any person other than the parties hereto and their respective successors and permitted assigns or to otherwise create any third-party beneficiary hereto; provided , each Registration Rights Indemnitee and Company Registration Rights Indemnitee is an express third-party beneficiary of this Agreement with respect to the provisions of Section 10 and is entitled to enforce the provisions thereof.

 

Section 22.                                     Fees and Expenses .

 

Subject to Section 3, all fees and expenses incurred in connection with the preparation and negotiation of this Agreement and the consummation of the transactions contemplated by this Agreement shall be paid by the party incurring such expenses.

 

Section 23.                                     Severability .

 

If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially

 

 

adverse to any party.  Upon such determination, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby be completed as originally contemplated to the fullest extent possible.

 

Section 24.                                     Equitable Remedies; Limited Recourse .

 

(a)                                  Neither rescission, set-off nor reformation of this Agreement shall be available as a remedy to any of the parties hereto.  The parties hereto agree that irreparable damage would occur in the event any of the provisions of this Agreement were not to be performed in accordance with the terms hereof and that the parties shall be entitled, and each party hereby consents, to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms hereof, without bonds or other security being required, in addition to any other remedies at Law or in equity.  In the event that a party institutes any suit or action under this Agreement, including for specific performance or injunctive relief pursuant to this Section 24, the prevailing party in such proceeding shall be entitled to receive the costs incurred thereby in conducting the suit or action, including reasonable attorneys’ fees and expenses.

 

(b)                                  Notwithstanding anything that may be expressed or implied in this Agreement or any document or instrument delivered contemporaneously herewith, no person (other than the Company and Purchaser and their permitted assigns (if any), to the extent provided in, and subject to the limitations of, this Agreement) shall have any obligation hereunder and, notwithstanding that the Purchaser or any of its permitted assigns may be a corporation, partnership or limited liability company, no person shall have any rights of recovery against, or recourse hereunder or in respect of any oral representations made or alleged to be made in connection herewith, against, any former, current and future direct or indirect equityholders, controlling persons, stockholders, directors, officers, employees, agents, Affiliates, members, managers, general or limited partners, financing sources, assignees, successors or predecessors or attorneys or other representatives of Purchaser, or any of its successors or assigns, or any former, current and future direct or indirect equityholders, controlling persons, stockholders, directors, officers, employees, agents, Affiliates, members, managers, general or limited partners, financing sources, assignees, successors or predecessors or attorneys or other representatives or successors or assigns of any of the foregoing (each, a “ Related Party ” and together, the “ Related Parties ”), in each case, other than, for the avoidance of doubt, solely against Purchaser, to the extent provided in, and subject to the limitations contained in, this Agreement (collectively, the “ Available Remedies ”), whether by or through attempted piercing of the corporate veil, by or through any claim against any Related Party, by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any applicable Law, it being agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any Related Party for any obligations of the Purchaser under this Agreement or in respect of any oral representations made or alleged to be made in connection herewith or therewith or for any claim (whether at law or equity or in tort, contract or otherwise) based on, in respect of, or by reason of such obligations or their creation (in each case, for the avoidance of doubt, other than in respect of the Available Remedies solely against Purchaser). Under no circumstances shall Purchaser (or any of its Related Parties or assignees) be liable hereunder for any special, incidental, consequential, indirect or punitive damages to any person, including the

 

 

Company, the Company’s equityholders or any of their respective Affiliates in respect of this Agreement.

 

Section 25.                                     Subsequent Registration Rights .  The Company (a) has not granted to Other Investors and shall not grant any registration rights to Other Investors or third parties which are more favorable than or inconsistent with the rights granted hereunder, or (b) enter into any agreement, take any action, or permit any change to occur, with respect to its securities, that violates or subordinates the rights expressly granted to Purchaser in this Agreement.

 

[Signature Page Follows]

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

	LIBERTY BROADBAND CORPORATION
	By:	/s/ Craig Troyer
		Name:	Craig Troyer
		Title:	Vice President, Deputy General Counsel and Assistant Secretary
	QUANTUM PARTNERS LP
	By: QP GP LLC, its general partner
	By:	/s/ Thomas L. O’Grady
		Name:	Thomas L. O’Grady
		Title:	Attorney-in-Fact

 

[Signature Page to Registration Rights Agreement]

 

 

EXHIBIT A

 

Form Of Agreement Counterpart For A Permitted Transferee

 

Agreement Counterpart for Permitted Transferee (this “Agreement”), dated the date indicated below (the “Effective Date”), between Quantum Partners LP, a Cayman Islands exempted limited partnership (“ Purchaser ”) and the Permitted Transferee named below.

 

Reference is made to the Registration Rights Agreement (the “ Registration Rights Agreement ”) made and entered into as of May 18, 2016, by and between Liberty Broadband Corporation, a Delaware corporation (the “ Company ”), and Purchaser.  All terms used but not otherwise defined herein have the meanings set forth in the Registration Rights Agreement.

 

1.                                       Assignment and Assumption .  Effective as of the Effective Date, Purchaser hereby assigns, transfers and conveys to  Permitted Transferee all rights, benefits, liabilities and obligations applicable to Purchaser under the Registration Rights Agreement as to the number of Registrable Securities indicated beneath the signature of Permitted Transferee below, and  Permitted Transferee hereby accepts and assumes such rights, benefits, liabilities and obligations and agrees to be bound thereby and to perform such obligations as if Permitted Transferee had originally executed and delivered the Registration Rights Agreement.

 

2.                                       No Greater Rights .  If Purchaser is selling or transferring to Permitted Transferee less than all of Purchaser’s Registrable Securities, Permitted Transferee acknowledges and agrees that Purchaser and Permitted Transferee shall have no greater rights collectively than Purchaser had individually pursuant to this Agreement prior to the execution and delivery of this Agreement.

 

3.                                       Third Party Beneficiary .  The Company is an express third party beneficiary of this Agreement.

 

Dated:			QUANTUM PARTNERS LP
			By:
				Name:
				Title:
			PERMITTED TRANSFEREE
			Name:
			Address:
			By:
				Name:
				Title:

 

 

Number of Registrable Securities: