UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
Under the Securities Exchange Act of 1934
(Amendment No. 1)
NEXT LEVEL COMMUNICATIONS, INC.
(Name of Issuer)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
65333U 10 4
(CUSIP Number)
Carol H. Forsyte
Motorola, Inc.
1303 East Algonquin Road, Schaumburg, IL 60196
(847) 576-5000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 16, 2001
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4),
check the following box. [ ]
Note: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties
to whom copies are to be sent.
The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the
subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in a
prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities
of that section of the Act but shall be subject to all other provisions
of the Act (however, see the Notes).
1. NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (entities only)
Motorola, Inc.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a)
(b)
3. SEC USE ONLY
4. SOURCE OF FUNDS (See Instructions)
OO
5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
State of Incorporation: Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7. SOLE VOTING POWER
67,103,724 (Includes 3,000,000 shares of common stock which are
subject to warrants currently exercisable within 60 days. See Item
4.)
8. SHARED VOTING POWER
0
9. SOLE DISPOSITIVE POWER
67,103,724 (Includes 3,000,000 shares of common stock which are
subject to warrants currently exercisable within 60 days. See Item
4.)
10. SHARED DISPOSITIVE POWER
0
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
67,103,724 (Includes 3,000,000 shares of common stock which are
subject to warrants currently exercisable within 60 days. See Item
4.)
12. CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
76.2%
14. TYPE OF REPORTING PERSON (See Instructions)
CO
STATEMENT PURSUANT TO RULE 13d-1
OF THE
GENERAL RULES AND REGULATIONS
UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
Item 1. Security and Issuer.
Item 1 is amended and restated to read as follows:
This statement on Schedule 13D (this "Statement") relates to the
Common Stock, par value $0.01 per share (the "Shares"), of Next Level
Communications, Inc., a Delaware corporation (the "Company") and
amends and supplements all information contained in the initial
statement on Schedule 13D (the "Initial Statement") filed on January
14, 2000, by Motorola, Inc., a Delaware corporation ("Motorola"), the
Voting Trust and the Trustee (each as defined and identified in the
Schedule 13D filed on November 22, 1999, by General Instrument ("GI
13D") on which Shares were previously reported as beneficially owned
by General Instrument. The Company's principal executive offices are
at 6085 State Farm Drive, Rohnert Park, California 94928. Unless
otherwise indicated, capitalized terms used but not defined herein
shall have the same meanings assigned to such terms in the Initial
Statement and are incorporated herein by reference.
Item 2. Identity and Background.
Item 2 is amended and restated to read as follows:
(a) - (c), (f) This Statement is being filed by Motorola, Inc., a
Delaware corporation ("Motorola"). Motorola's principal executive
offices are located at 1303 East Algonquin Road, Schaumburg, Illinois
60196. Motorola is a global leader in providing integrated
communications solutions and embedded electronic solutions. These
include: (i) software-enhanced wireless telephone, two-way radio,
messaging products and systems, as well as networking and Internet-
access products, for consumers, network operators, and commercial,
government and industrial customers; (ii) end-to-end systems for the
delivery of interactive digital video, voice and high-speed data
solutions for broadband operations; (iii) embedded semiconductor
solutions for customers in the networking and computing, transportation
wireless communications and digital consumer/home networking markets;
and (iv) embedded electronic systems for automotive, industrial,
transportation, navigation, communications and energy systems markets.
The names, business addresses and present principal occupations or
employment of the directors and executive officers of Motorola are set
forth in the attached Appendix 1, which is incorporated herein by
reference. To the best of Motorola's knowledge, except as noted on
Appendix 1, all directors and executive officers of Motorola are
citizens of the United States.
(d) - (e) Neither Motorola, nor to the best of Motorola's
knowledge, any of the directors or executive officers listed on
Appendix 1 has been, during the last five years, (a) convicted in a
criminal proceeding (excluding traffic violations or similar
misdemeanors) or (b) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation
with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 is amended and restated to read as follows:
On January 5, 2000, pursuant to an agreement and plan of merger
(the "Agreement and Plan of Merger"), dated September 14, 1999,
General Instrument Corporation, a Delaware corporation ("General
Instrument") merged with and into Lucerne Acquisition Corp.
("Lucerne"), a Delaware corporation and a wholly-owned subsidiary of
Motorola (the "Merger"). As a result of the Merger the separate
corporate existence of Lucerne ceased and General Instrument continued
as the surviving corporation as a wholly-owned subsidiary of Motorola.
In connection with the Merger, each outstanding share of General
Instrument common stock was exchanged for 0.575 shares of Motorola
common stock, with cash in lieu of any fractional Motorola shares that
former General Instrument stockholders would have otherwise received.
As a result of the Merger, General Instrument became a wholly-
owned subsidiary of Motorola, the Voting Trust was terminated and,
therefore, Motorola became the sole beneficial owner of the 64,103,724
Shares of the Company held by General Instrument, with the sole voting
and investment power with respect to such Shares. Consequently,
Motorola has assumed the reporting obligations with respect to such
Shares, and no future statements on Schedule 13D or amendments will be
filed by General Instrument, the Voting Trust or the Trustee with
respect to such Shares.
On May 16, 2001, Motorola and the Company entered into a $60
million credit agreement (the "Credit Agreement"). Under the terms of
the Credit Agreement, the Company granted Motorola warrants for up to
7,500,000 shares of the Company's common stock (the "Warrants"), all
with an exercise price of $7.39 per share. The Warrants expire on May
15, 2006 and are exercisable in varying increments described below in
Item 4.
Item 4. Purpose of Transaction.
Item 4 is amended and restated to read as follows:
Beneficial ownership of the 64,103,724 Shares was acquired by
Motorola as part of the Merger. Reference is made to Motorola's
Registration Statement on Form S-4 (File No. 333-88735) for more
information regarding the Merger, including the background and reasons
therefor. Prior to the Merger, beneficial ownership of the 64,103,724
Shares was with General Instrument. Reference is made to the GI 13D for
more information regarding beneficial ownership of such Shares by
General Instrument, the Voting Trust and the Trustee.
Prior to the Merger, the 64,103,724 Shares were held in the Voting
Trust, which was terminated upon the Merger. Following such
termination, such Shares were registered to General Instrument.
Pursuant to the Corporate and Intercompany Agreement described in Item
6 below, upon termination of the Voting Trust, the Company's board of
directors took action to appoint the following Motorola employees as
Company directors. Currently, Eugene Delaney, Ferdinand C. Kuznik and
Richard D. Severns are employees of Motorola and continue to serve as
Company directors. Jerry Roseland has retired from Motorola, but
continues to serve as a Company director.
On May 16, 2001, Motorola and the Company entered into the Credit
Agreement. Under the terms of the Credit Agreement, the Company
granted Motorola warrants for up to 7,500,000 shares of the Company's
common stock. All the warrants have an exercise price of $7.39 per
share and expire on May 15, 2006. The warrants are exercisable in
varying increments as follows: a) on May 16, 2001, (the "Effective
Date") of the Credit Agreement, warrants for 1,500,000 shares of the
Company's common stock became exercisable; b) on May 18, 2001, warrants
for an additional 1,500,000 shares of the Company's common stock became
exercisable when the Company's cumulative borrowing under the Credit
Agreement exceeded $30 million; c) when the Company's cumulative
borrowing under the Agreement equals or exceeds $40 million, warrants
for an additional 750,000 shares of the Company's common stock become
exercisable; d) when the Company's cumulative borrowing under the
Agreement equals or exceeds $50 million, warrants for an additional
750,000 shares of the Company's common stock become exercisable; and e)
regardless of the Company's cumulative borrowing under the Agreement,
warrants for an additional 3,000,000 shares of the Company's common
stock become exercisable in 1,000,000 increments on May 17, 2002,
November 17, 2002 and February 17, 2003 respectively, unless prior to
those dates the Company's borrowings under the Credit Agreement have
been repaid in full and the Credit Agreement has been terminated.
Of the 7,500,000 warrants, 3,000,000 are currently exercisable and
4,500,000 are not currently exercisable within 60 days.
As a result of the Merger, the grant of Warrants and related
transactions described herein, Motorola is able to exercise a majority
of the total voting power of the Company. Motorola has appointed four
of the eight current directors. In addition, one of the current
directors is an employee of the Company. Except in connection with the
agreements and arrangements described herein, Motorola has no current
plans or proposals which relate to or would result in any of the events
described in Items (a) through (j) of Item 4 to Schedule 13D. Motorola
does, however, expect to evaluate on an ongoing basis its intentions
with respect to the Company and may determine to pursue one or more of
the actions specified in Items (a) through (j).
Motorola currently intends to maintain beneficial ownership of all
of its Shares. However, Motorola may acquire beneficial ownership of
additional Shares or sell or otherwise dispose of beneficial ownership
of any or all of the Shares it beneficially owns. Motorola reserves
the right to change its plans and intentions at any time and to take
any action, with respect to the Company or any of its debt or equity
securities, in any manner permitted by law. Restrictions on the
ability to sell or otherwise dispose of the 64,103,724 Shares per the
Lock-Up Agreement described in Item 6 below expired on May 10, 2000.
Item 5. Interest in Securities of the Issuer.
Item 5 is amended and restated to read as follows:
(a) - (b) Motorola is the beneficial owner (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) of 67,103,724 shares of the Company's common stock
(see Footnote 1)(constituting 76.23% of the total outstanding shares of
the Company's common stock). As to such shares, Motorola has the sole
power to vote or to direct the vote and sole power to dispose or direct
the disposition of all of the shares.
(c) David Robinson, Executive Vice President and President,
Broadband Communications Sector of Motorola has sole voting and
investment control of 5,000 shares of the Company's common stock, a
negligible percent of the total outstanding shares of the Company's
common stock. Neither Motorola nor, to the knowledge of Motorola, any
of the individuals identified in Appendix 1 has executed any
transactions in the Company's stock during the past 60 days.
(d) There is no person that has the right to receive or the power
to direct the receipt of dividends from, or the proceeds from the sale
of, the Shares beneficially owned by Motorola.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of Issuer.
Item 6 is amended and restated to read as follows:
General Instrument entered into the following agreements with
respect to its ownership of the Shares that are now beneficially owned
by Motorola. The following summary of certain provisions of these
agreements is qualified in its entirety by reference to these
agreements themselves, which are filed as exhibits hereto and hereby
incorporated by reference.
Lock-Up Agreement. As an inducement to the underwriters in
connection with the Company's initial public offering of Shares,
General Instrument entered into a lock-up agreement (the "Lock-Up
Agreement") pursuant to which it agreed not to sell or otherwise
dispose of any Shares for 180 days after November 9, 1999 without the
prior written consent of Credit Suisse First Boston Corporation. The
Lock-Up Agreement expired on May 10, 2000.
Corporate and Intercompany Agreement. General Instrument and the
Company have entered into the Corporate and Intercompany Agreement,
dated as of November 15, 1999, (the "Corporate and Intercompany
Agreement") under which, among other things, the Company has granted
General Instrument and its affiliates a continuing option to purchase
additional Shares or shares of non-voting capital stock of the Company.
If the Company issues any additional equity securities after its
initial public offering, General Instrument and its affiliates may
exercise this option to purchase: (i) Shares to the extent necessary
for them to maintain their then-existing percentage of the total voting
power; and (ii) shares of non-voting capital to the extent necessary to
own 80% of any class of non-voting capital stock which may be
outstanding. The purchase price of the Shares will be the market price
of the common stock. The purchase price of non-voting capital stock
will be the price at which third parties may purchase this stock. The
stock option expires if General Instrument and its affiliates
beneficially own less than 30% of the outstanding Shares.
The Corporate and Intercompany Agreement also provides that,
immediately upon the termination of the Voting Trust, the Company and
its board of directors will take all actions necessary to appoint on
the date of termination any number of additional directors nominated by
General Instrument. As indicated in Item 4 above, upon the Merger, the
Company's board appointed certain individuals as Company directors at
Motorola's request.
Registration Rights Agreement dated November 15, 1999. General
Instrument, Spencer Trask Investors LLC ("Spencer Trask") and the
Company entered into a registration rights agreement, dated as of
November 15, 1999 (the "Registration Rights Agreement"). Under the
Registration Rights Agreement, the Company granted to these
stockholders and their affiliates the right to request that the Company
use its best efforts to register their Shares under federal and state
securities laws so that they may sell or dispose of their Shares in
accordance with these laws. So long as General Instrument and its
affiliates own 30% of the Company's outstanding common stock, they will
not be limited in the number of times they may make that request.
After their ownership declines below that level, they will be able to
cause the Company to effect up to four demand registration of their
Shares. Under customary "piggy-back" registration rights, General
Instrument and its affiliates will also be entitled to include their
shares in all registrations of common stock that the Company makes,
either for a sale by the Company or any of its stockholders, subject to
customary exceptions. The Company will pay for all out-of-pocket
expenses relating to these registrations and indemnify General
Instrument and its affiliates against liabilities under securities
laws. General Instrument and its affiliates may generally assign these
registration rights to transferees of their Shares.
Credit Agreement. On May 16, 2001, Motorola and the Company
entered into a $60 million Credit Agreement. Under the terms of the
Credit Agreement, the Company granted Motorola warrants for up to
7,500,000 shares of the Company's common stock (the "Warrants"), all
with an exercise price of $7.39 per share. The Warrants expire on May
15, 2006 and are exercisable in varying increments described above in
Item 4.
Security Agreement. As security for the obligations under the
Credit Agreement the Company entered into a Security Agreement dated as
of May 16, 2001 with Motorola, pursuant to which the Company granted to
Motorola a security interest in substantially all of the personal
property assets of the Company, including certain patents and patent
applications. If the Company defaults under its obligations under the
Credit Agreement, Motorola is entitled to exercise remedies with
respect to the pledged assets, including those available to a secured
party under the Uniform Commercial Code.
Registration Rights Agreement dated May 16, 2001. Motorola and
the Company also entered into a Registration Rights Agreement dated as
of May 16, 2001 pursuant to which the Company granted Motorola both
demand registration rights (for up to four registrations) and piggyback
registration rights related to shares obtained in connection with the
Warrants. The Company further agreed to use its best efforts to ensure
that the conditions to the availability of Rule 144 set forth in
paragraph (c) thereof shall be satisfied, and to use its reasonable
efforts to cause all conditions to the availability of Form S-3 to be
met as soon as practicable after the date of the Registration Rights
Agreement.
Item 7. Material to be Filed as Exhibits.
Item 7 is amended and restated to read as follows:
1. Form of Agreement and Plan of Merger, by and among Motorola,
Lucerne and General Instrument (incorporated by reference to
Appendix A to Motorola's registration statement ("Motorola's
Registration Statement") on Form S-4, File No. 333-88735,
filed with the Commission on November 30, 1999).
2. Form of Registration Rights Agreement, by and among General
Instrument, the Company and Spencer Trask (incorporated by
reference to Exhibit 4.2 to amendment number 6 ("Amendment
No. 6") to the Company's registration statement on Form S-1,
File No. 333-85999 (the "Registration Statement"), filed with
the Commission on November 9, 1999).
3. Form of Voting Trust Agreement, by and among General
Instrument, the Company and ChaseMellon Shareholder Services,
LLC, as trustee (incorporated by reference to Exhibit 9.1 to
Amendment No. 6).
4. Form of Lock-Up Agreement (incorporated by reference to
Exhibit D to the form of an underwriting agreement (the
"Underwriting Agreement") filed as Exhibit 1.1 to amendment
number 4 ("Amendment No. 4") to the Registration Statement,
filed with the Commission on October 29, 1999).
5. Form of Corporate and Intercompany Agreement, between General
Instrument and the Company (incorporated by reference to
Exhibit 10.2 to Amendment No. 6).
6. Credit Agreement, dated as of May 16, 2001, between the
Company and Motorola (incorporated by reference to Exhibit
99.1 of the Company's Current Report on Form 8-K filed on May
29, 2001).
7. Security Agreement, dated as of May 16, 2001, between the
Company and Motorola (incorporated by reference to Exhibit
99.2 of the Company's Current Report on Form 8-K filed on May
29, 2001).
8. Form of Warrant, between the Company and Motorola
(incorporated by reference to Exhibit 99.3 of the Company's
Current Report on Form 8-K filed on May 29, 2001).
9. Registration Rights Agreement, dated as of May 16, 2001,
between the Company and Motorola.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is
true, complete and correct.
Date: June 14, 2001
MOTOROLA, INC.
By: / s / Carol H. Forsyte
Name: Carol H. Forsyte
Title: Vice President,
Corporate and Securities
FOOTNOTE 1
Motorola's beneficial ownership of the Company's common stock consists
of (i) 64,103,724 shares of the Company's common stock and (ii)
3,000,000 shares of the Company's common stock deemed to be outstanding
under Rule 13d-3(d) under the Exchange Act as a result of Motorola's
ownership of 3,000,000 shares of common stock which are subject to
warrants currently exercisable within 60 days.
APPENDIX I
INFORMATION CONCERNING THE DIRECTORS AND EXECUTIVE OFFICERS OF MOTOROLA
The following table sets forth the name, business address, and
principal occupation or employment at the present time for each
director and executive officer of Motorola. Unless otherwise noted,
each such person is a citizen of the United States. In addition,
unless otherwise noted, each such person's business address is 1303
East Algonquin Road, Schaumburg, Illinois 60196.
DIRECTORS OF MOTOROLA
Christopher B. Galvin...Chairman of the Board and Chief Executive
Officer, Motorola, Inc.
Robert L. Growney...President and Chief Operating Officer, Motorola,
Inc.
Francesco Caio...Chief Executive Officer, Netscalibur. His Business
address is: Via Caldera 21, 20153 Milano, Italy. Mr. Caio is a citizen
of Italy.
Ronnie C. Chan...Chairman, Hang Lung Development Group. His business
address is: Hang Lung Development Company Limited, 28/F Standard
Chartered Bank Building, 4 Des Voeux Road Central, Hong Kong. Mr. Chan
is a U.S. citizen residing in Hong Kong.
H. Laurance Fuller...Retired; formerly Co-Chairman of the Board of
Directors, BP Amoco, p.l.c. His business address is: Primary Business
Center, 1111 E. Warrenville Road, Suite 257, Naperville IL 60563.
Anne P. Jones...Consultant. Her business address is: 5716 Bent Branch
Road, Bethesda, MD 20816.
Judy C. Lewent...Executive Vice President and Chief Financial Officer,
Merck & Co., Inc. Her business address is: Merck & Co., Inc., One Merck
Drive, Whitehouse Station, NJ 08889.
Dr. Walter E. Massey...President of Morehouse College. His business
address is: Morehouse College, 830 Westview Drive, SW, Atlanta, GA
30314.
Nicholas Negroponte...Senior Director of the Massachusetts Institute of
Technology Media Laboratory. His business address is: Massachusetts
Institute of Technology Media Lab, 20 Ames St. E15-210, Cambridge, MA
02139.
John E. Pepper, Jr....Chairman of the Board of Directors, Procter &
Gamble Co. His business address is: Procter & Gamble Co., One Procter &
Gamble Plaza, Cincinnati, OH 45202.
Samuel C. Scott III...Chairman and Chief Executive Officer, Corn
Products International. His business address is: CPC International,
Inc. 6500 Archer Road, Summit-Argo, IL 60501.
B. Kenneth West...Senior Consultant for Corporate Governance to
Teachers Insurance and Annuity Association-College Retirement Equities
Fund. His business address is: Retired Chairman of the Board, Harris
Bankcorp, Inc., 111 W. Monroe (LLW), Chicago, IL 60603.
Dr. John A. White...Chancellor, University of Arkansas. His business
address is: University of Arkansas, 425 Administration Building,
Fayetteville, AR 72701.
EXECUTIVE OFFICERS OF MOTOROLA, INC.
(WHO ARE NOT ALSO DIRECTORS OF MOTOROLA)
Keith J. Bane...Executive Vice President and President, Global Strategy
and Corporate Development.
Robert L. Barnett...Executive Vice President and President, Commercial,
Government and Industrial Systems Sector.
Edward Breen...Executive Vice President and President, Networks Sector.
Glenn A. Gienko...Executive Vice President and Motorola Director of
Human Resources.
Joseph M. Guglielmi...Executive Vice President and President, Global
Customer Solutions Operations.
Bo Hedfors...Executive Vice President and President, Global Telecom
Solutions Sector. Mr. Hedfors is a citizen of Sweden.
Carl F. Koenemann...Executive Vice President and Chief Financial
Officer.
Ferdinand C. Kuznik...Executive Vice President and President, Motorola
Europe, Middle East and Africa.
A. Peter Lawson...Executive Vice President, General Counsel and
Secretary.
Thomas J. Lynch...Executive Vice President and President, Integrated
Electronic Systems Sector.
Dennis A. Roberson...Senior Vice President and Chief Technology
Officer.
David E. Robinson...Executive Vice President and President, Broadband
Communications Sector.
Fred (Theodore) A. Shlapak...Executive Vice President and President,
Semiconductor Products Sector.
C. D. Tam...Executive Vice President and President, Asia Pacific
Region. Mr. Tam is a citizen of Hong Kong and a permanent resident of
the United States.
Mike S. Zafirovski...Executive Vice President and President, Personal
Communications Sector.