Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 1 of 22
IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE
Chapter 11 In re: Case No. 21-10457 (LSS) MOBITV, INC., et al., Jointly Administered Debtors.1 Related Docket Nos. 73 and 164
DECLARATION OF KEVIN B. LENHART, REPRESENTATIVE OF TIVO CORPORATION, IN SUPPORT OF ENTRY OF AN ORDER (A) APPROVING THE SALE OF SUBSTANTIALLY ALL OF THE DEBTORS’ ASSETS FREE AND CLEAR OF ALL LIENS, CLAIMS, INTERESTS, AND ENCUMBRANCES AND (B) APPROVING THE ASSUMPTION AND ASSIGNMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES
I, Kevin B. Lenhart, being duly sworn, do hereby declare and state as follows:
1. I am the General Manager of Xperi Holding Corporation’s Pay TV business unit,
which includes oversight of the business operations of the pertinent aspects of TiVo Corporation’s
Pay TV business operations. TiVo Corporation, a Delaware corporation, is a direct wholly-owned
subsidiary of Xperi Holding Corporation, a Delaware corporation (“Xperi”). The above-captioned
Debtors’ (the “Debtors”) designated TiVo (defined below) as the successful bidder on substantially
all of the Debtors’ assets with a purchase price of $17.4 million in cash (the “Purchase Price”) and
the assumption of certain liabilities of up to $6.5 million as further described below. My business
address is Xperi Holding Corporation, 2160 Gold St, San Jose, CA 95002.
2. I submit this declaration in support of the entry of the Debtors’ proposed order
approving the sale of substantially all of the assets of the Debtors to TiVo Corporation or its
designee, TiVo Platform Technologies, LLC, a Delaware limited liability company (collectively,
1 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s U.S. tax identification number are as follows: MobiTV, Inc. (2422) and MobiTV Service Corporation (8357). The Debtors’ mailing address is 1900 Powell Street, 9th Floor, Emeryville, CA 94608.
DB1/ 121522732 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 2 of 22
“TiVo”) pursuant to the proposed Order (A) Approving the Sale of Substantially All of the Debtors’
Assets Free and Clear of All Liens, Claims, Interests, and Encumbrances and (B) Approving the
Assumption and Assignment of Executory Contracts and Unexpired Leases (the “TiVo Sale
Order”). A draft of the proposed TiVo Sale Order was filed at DE #253.
Facts Pertaining to Declarant’s Knowledge of Transaction
3. In my role as General Manager of Xperi’s Pay TV business unit and oversight of
the Pay TV business operations of TiVo, I have been involved in TiVo’s due diligence process and
potential acquisition of the Debtors’ business assets (the “Transaction”) since prior to the
commencement of these chapter 11 cases. I therefore have direct knowledge of the relevant aspects
of the Transaction and Xperi’s and TiVo’s business operations. All facts set forth in this
declaration (this “Declaration”) are based on my personal knowledge, my communications with
Xperi’s and TiVo’s advisors and internal personnel at TiVo and Xperi who are also working on
this matter, discussions with the Debtors’ advisors and personnel, my review of relevant
documents, my opinion based on my overall professional experience, or in light of my personal
knowledge of the Transaction and the businesses of Xperi and its subsidiaries, including TiVo. If
called as a witness, I could and would competently testify to the matters set forth herein based on
the foregoing. I am duly authorized to submit this Declaration on behalf of Xperi and TiVo.
Fact Pertaining to Witness Qualifications
4. Given my testimony herein covers TiVo’s ability to both technically and financially
perform its obligations in connection with certain assumed contract counterparties, I describe
below both my technical and business qualifications. I hold a (a) Bachelor of Science degree in
Electrical Engineering from Drexel University in Philadelphia, PA, (b) Master of Science in
Engineering in Telecommunications and Network Engineering from the University of
DB1/ 121522732 2 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 3 of 22
Pennsylvania, and (c) Master of Business Administration from the University of Pennsylvania’s
Wharton School of Business.
5. My association with TiVo began in 2015 when I joined Rovi Corporation, which
acquired TiVo Corporation in 2016 and then merged with Xperi Corporation in June 2020 and
formed Xperi as the new parent company of TiVo and Xperi Corporation. I played an instrumental
role in Rovi Corporation’s 2016 $1.1 billion acquisition of TiVo Corporation, which was a
transformative combination of two large companies in similar business segments that required
complex business integration and that led to significant cost synergies. Following the acquisition,
I was responsible for TiVo’s Corporate and Strategic Development team, and eventually led the
strategic alternatives process resulting in TiVo’s 2016 merger with Xperi Corporation to create a
leader in consumer & entertainment technology. Prior to 2015, I developed extensive industry
experience, serving in leadership roles across business development, product and engineering at
ARRIS Group, Motorola Mobility, Inc., Motorola, Inc. and General Instrument Corporation. My
current responsibilities in the Xperi/TiVo organization include (a) overseeing a large portfolio of
user experience and discovery solutions for Pay TV operator and media partners, and (b) leading
the global Pay TV product, engineering and metadata operations teams.
Facts Pertaining to TiVo’s Successful Bid
6. On May 7, 2021, TiVo submitted to the Debtors a bid package for purchasing the
Debtors’ assets for $13 million in cash and assuming certain liabilities, including up to $4 million
in cure amounts for all agreements that are assumed and assigned to TiVo (the “Transferred
Contracts”), which represents a capped cure amount in excess of all cure amounts owing to the
contract counterparties according to the Debtors’ books and records provided to TiVo. TiVo also
agreed to pay up to $2.5 million for amounts the Debtors owed to certain of its employees that
DB1/ 121522732 3 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 4 of 22
TiVo anticipates hiring in connection with the Transaction. TiVo later modified its bid structure
so that is was abundantly clear that the up to $2.5 million in employee-related payments would be
in satisfaction of the Debtors’ obligations to pay accrued paid time off (“PTO”) and 2019 bonuses
for those employees that TiVo hires. The clarification was to ensure that the potential claims of
the hired employees against the Debtors would be satisfied and there would thus be a measurable
and tangible benefit to the Debtors’ estates for which TiVo’s bid should be recognized.
7. The Debtors ultimately designated TiVo’s bid as the highest and best, and thus the
baseline bid against which other bidders were to top at the auction that was set to commence on
the morning of May 11, 2021. The auction commenced on schedule and ran for two days with
multiple rounds of bidding. TiVo ultimately emerged as the successful bidder after increasing the
cash component of its bid in several increments to $17.4 million. Accordingly, TiVo’s successful
bid is comprised of (a) $17.4 million in cash, (b) up to $4 million in cure amounts for Transferred
Contracts, and (b) up to $2.5 million for accrued PTO for the more than 50 employees that TiVo
has agreed to hire (the “TiVo Sale Consideration”).
Facts Pertaining to Xperi and TiVo Corporate Structure and Relationship
8. On December 18, 2019, Xperi Corporation, a Delaware corporation, entered into a
definitive agreement with TiVo to combine in an all-stock merger of equals transaction (the
“Mergers”). Following consummation of the Mergers on June 1, 2020, Xperi became the parent
company of both Xperi Corporation and TiVo Corporation. The common stock of both Xperi
Corporation and TiVo Corporation were de-registered after completion of the Mergers. On June
2, 2020, Xperi’s common stock, par value $0.001 per share, commenced trading on the Nasdaq
Global Select Market under the ticker symbol “XPER.”
DB1/ 121522732 4 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 5 of 22
Facts Pertaining to Business Operations
9. The Mergers made the combined company a formidable consumer and
entertainment product/solutions licensing company and one of the industry’s largest intellectual
property licensing platforms, with a diverse portfolio of media and semiconductor intellectual
property and more than 11,000 patents and patent applications worldwide. Xperi invents,
develops, and delivers technologies that enable extraordinary experiences. These technologies,
delivered via Xperi’s brands (DTS, HD Radio, IMAX Enhanced, Invensas, TiVo) make
entertainment more entertaining, and smart devices smarter. Xperi’s technologies are integrated
into billions of consumer devices, media platforms, and semiconductors worldwide, driving
increased value for partners, customers and consumers. Xperi shapes how millions of consumers
access and experience entertainment content, and its innovations are found in billions of devices
and hundreds of millions of interfaces around the globe. Headquartered in Silicon Valley with
operations around the world, Xperi and its subsidiaries, including TiVo, have approximately 1,800
employees and over 30 years of operating experience.
Facts Pertaining to Financial Assurance of Future Performance
10. In the Mergers, Xperi Corporation was determined to be the accounting acquiring
entity. Accordingly, the historical financial statements of Xperi Corporation for periods prior to
the Mergers are considered to be the historical financial statements of Xperi and its financial results
of operations include the operations of TiVo after June 1, 2020. TiVo’s results of operations for
periods prior to that are separate and are included in TiVo’s historic Annual Reports on Form 10-
K. As a publicly traded company, Xperi files Annual Reports on Form 10-Ks and Quarterly
Reports on Form 10-Qs showing its financial performance and its subsidiaries on a consolidated
basis.
DB1/ 121522732 5 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 6 of 22
11. As of December 31, 2020, Xperi had assets with a book value of over $2.7 billion
and liabilities of under $1.3 billion, and as of March 31, 2021, it had approximately $237 million
in cash and cash equivalents on its consolidated balance sheet. On May 13, 2021, TiVo provided
the Debtors with the adequate assurance package containing the foregoing financial information
and other information described herein, a true and correct copy of which is attached hereto as
Exhibit 1 (the “Adequate Assurance Package”). I understand the Debtors served the Adequate
Assurance Package on the counterparties to the contracts, leases, licenses, and other agreements
that may become Transferred Contracts. A true and correct copy of Xperi’s consolidated balance
sheet from its 2020 Annual Report on Form 10-K is attached as Exhibit A to the Adequate
Assurance Package. To the extent a counterparty or any other party in interest reading this
declaration wishes to review further financial information regarding Xperi and TiVo, additional
publicly available financial reporting can be found in Xperi’s Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q found on its website: https://investor.xperi.com/financials (see
also the “Financials” pull down link near the top of that webpage).
12. TiVo has agreed, and I believe it is committed and amply capable from both a
financial and technological perspective, to close the Transaction by June 1, 2021, assuming the
Bankruptcy Court approves the transactions and no stay is in place at the time of the closing. TiVo
has ample cash availability to pay the TiVo Sale Consideration. While TiVo has reserved the right
to designate a subsidiary as the transferee of the assets under the Sale and the assumption of the
related obligations, such subsidiary will by adequately capitalized with TiVo providing assurances
for the upfront payment of the TiVo Sale Consideration. Such designee is currently anticipated to
be TiVo Platform Technologies LLC, a Delaware limited liability company, which is an existing
operating indirect subsidiary of TiVo Corporation.
DB1/ 121522732 6 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 7 of 22
13. To further demonstrate TiVo’s ability to perform financially under the Transaction,
Xperi has provided a written guaranty of TiVo’s obligation to pay the $17.4 million cash Purchase
Price. A true and correct copy of the guaranty is attached as Exhibit B to the Adequate Assurance
Package. I believe this further demonstrates TiVo’s commitment to consummating the
Transaction, including the obligations to be assumed and assigned with respect to the Transferred
Contracts and to the employees that will be hired.
Facts Pertaining to Technical Assurance of Future Performance
14. Given my education, industry background, and knowledge and experience with
TiVo and Xperi, I am confident that TiVo has ample technical capability in-house to perform its
obligations to the Transferred Contract counterparties. That said, TiVo has committed to hire at
least 50 of the Debtors’ employees who will assist existing TiVo and Xperi personnel in the
transition of the business to TiVo and its continuation into the future under a far better capitalized
structure. Accordingly, I believe that TiVo has the technical expertise and will acquire the
Debtors’ legacy business experience to operate the business assets TiVo is purchasing on a going
forward basis.
Facts Pertaining to Good Faith and No Collusion
15. While there was coordination between Xperi, TiVo, and certain other affiliates in
the Xperi group of companies (the “Xperi Entities”) to conduct diligence and package its
successful bid for the Debtors’ assets, none of the Xperi Entities colluded with any of the other
bidders at, before, or after the auction. None of the Xperi Entities is an insider of the Debtors nor
are any of the Xperi Entities an insider of the other parties that bid at the auction. Accordingly, I
believe this was an arms’ length transaction. The auction process established by the Debtors and
the good faith participation and bidding by TiVo resulted in the cash Purchase Price component of
DB1/ 121522732 7 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 8 of 22
its bid increasing from $13 million to $17.4 million. Accordingly, in my opinion, the results of
the auction on their face further support the good faith findings contained in the TiVo Sale Order.
Facts Pertaining to Substantial Change in Business and No Successor Liability.
16. The integration of the Debtors’ assets with the business of TiVo will result in a
substantial change from the businesses of the sellers as well as the purchaser. As of the March 1,
2021 (the “Petition Date”), the Debtors reported that they had 86 employees. Of these, TiVo is
planning to make employment offers to approximately 55, none of whom will be the Debtors’
senior management. Further, TiVo is not assuming any of the Debtors’ customer contracts and
will enter into new agreements the customers on a go-forward basis. This method of dealing with
customers and the integration of the new customers into TiVo’s customer base along with the
Debtors’ technology will likewise constitute a substantial change to the Debtors’ business as well
as TiVo’s business on a go-forward basis. Accordingly, TiVo will not be operating a mere
continuation of the Debtors’ business.
17. A finding that there will be a substantial change to the Debtors’ business is crucial
to TiVo to avoid any risk of successor liability for the failure of the seller to satisfy its obligations
under COBRA that theoretically could be attributable to a purchaser in bankruptcy under ERISA.
To further mitigate risk, TiVo has required that the Debtors provide COBRA coverage to any
employee of the Debtors who TiVo does not hire. In addition, TiVo has conditioned the
Transaction on receiving a finding in the TiVo Sale Order that, among other things, neither TiVo
nor any of its affiliates are a successor of the Debtors for COBRA or any other purpose.
18. Pursuant to the Transaction, TiVo is only assuming a finite set of obligations of the
Debtors. Such obligations include only the cure for the Transferred Contracts up to $4 million and
the PTO and 2019 bonuses up to $2.5 million for those employees that TiVo hires. All other
DB1/ 121522732 8 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 9 of 22
obligations will be left behind with the Debtors and their estates. TiVo is conducting this
Transaction based on the transfer of the assets being free and clear of all claims, liens, security
interests, encumbrances and other interests as expressly set forth in the TiVo Sale Order.
19. Accordingly, in my opinion, (1) the Debtors’ businesses will undergo substantial
change after integration with TiVo, (2) such integration will not reflect a merger, actual or de facto,
as between any of the Debtors or their affiliates and TiVo, Xperi or any of their affiliates, (3) none
of the Debtors’ liabilities are being either expressly or implicitly assumed by TiVo other than the
finite subset of liabilities as described in the TiVo purchase agreement annexed to the TiVo Sale
Order, and (4) the Transaction has been conducted under the supervision of the Bankruptcy Court,
the Debtors, and the Debtors’ key creditor constituencies. The Transaction is therefore, in my
opinion and based on the foregoing facts and other facts in the record, not being entered
fraudulently and is being conducted in good faith at arms’ length. In my further opinion, these
facts support the findings in the TiVo Sale Order that TiVo will not be a successor to the Debtors.
I declare under penalty of perjury that foregoing is true and correct to the best of my
knowledge, information and belief.
Dated: May 19, 2021 By: /s/Kevin B. Lenhart Kevin B. Lenhart
DB1/ 121522732 9 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 10 of 22
EXHIBIT 1
(Adequate Assurance Package)
DB1/ 121522732 DocuSign Envelope ID: 624BB6F2-03CB-47A8-92E8-F44CD0567B48Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 11 of 22
May 13, 2021
MobiTV, Inc. MobiTV Service Corporation c/o Jason Rosell, Esq. Pachulski Stang Ziehl & Jones LLP 150 California Street, 15th Floor San Francisco, CA 94111-4500
Re: TiVo Corporation’s Information Regarding Adequate Assurance of Future Performance in Connection with Purchase of Assets of MobiTV, Inc. and MobiTV Service Corporation
Dear Mr. Rosell:
TiVo Corporation (“TiVo”) is pleased to have been designated the successful bidder at the auction that concluded on May 12, 2021 for the sale (the “Sale”) of substantially all of the assets of MobiTV, Inc. and MobiTV Service Corporation (collectively, the “Debtors”) pursuant to the procedures approved by the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) that is overseeing the Debtors’ chapter 11 bankruptcy cases.
We are writing to provide additional information supporting TiVo’s ability to perform, and thus demonstrate adequate assurance of future performance, both with respect to TiVo’s obligations under the Asset Purchase Agreement, dated May 12, 2021 (the “Purchase Agreement”), and between TiVo and the Debtors and with respect to its obligations to counterparties to those contracts, leases, licenses, and/or other agreements that will be assumed and assigned to TiVo or its wholly-owned subsidiary as contemplated under the Purchase Agreement (the “Transferred Contracts”).
Relationship of TiVo and Xperi
On December 18, 2019, Xperi Corporation, a Delaware corporation, entered into a definitive agreement with TiVo to combine in an all-stock merger of equals transaction (the “Mergers”). Following consummation of the Mergers on June 1, 2020, Xperi Holding Corporation (“Xperi”) became the parent company of both Xperi Corporation and TiVo. The common stock of both Xperi Corporation and TiVo were de-registered after completion of the Mergers. On June 2, 2020, Xperi’s common stock, par value $0.001 per share, commenced trading on the Nasdaq Global Select Market under the ticker symbol “XPER.”
1 DocuSign Envelope ID: 624BB6F2-03CB-47A8-92E8-F44CD0567B48Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 12 of 22
Business Operations
The Mergers made TiVo and Xperi a formidable consumer and entertainment product/solutions licensing company and one of the industry’s largest intellectual property licensing platforms, with a diverse portfolio of media and semiconductor intellectual property and more than 11,000 patents and patent applications worldwide. They invent, develop, and deliver technologies that enable extraordinary experiences. Their technologies, delivered via their brands (DTS, HD Radio, IMAX Enhanced, Invensas, TiVo), and by another Xperi subsidiary, Perceive Corporation, make entertainment more entertaining, and smart devices smarter. Xperi’s technologies are integrated into billions of consumer devices, media platforms, and semiconductors worldwide, driving increased value for partners, customers and consumers. Xperi and TiVo shape how millions of consumers access and experience entertainment content, and our innovations are found in billions of devices and hundreds of millions of interfaces around the globe. Headquartered in Silicon Valley with operations around the world, Xperi and its subsidiaries, including TiVo, have approximately 1,800 employees and over 30 years of operating experience.
Financial Reporting and Cash Position
In the Mergers, Xperi was determined to be the accounting acquiring entity. Accordingly, the historical financial statements of Xperi Corporation for periods prior to the Mergers are considered to be the historical financial statements of Xperi Holding Corporation and its financial results of operations include the operations of TiVo after June 1, 2020. TiVo’s results of operations for periods prior to that are separate and are included in TiVo’s historic Forms 10-K. As a publicly traded company, Xperi files Forms 10-K showing its financial performance and its subsidiaries on a consolidated basis.
As of December 31, 2021, Xperi had assets with a book value of over $2.7 billion and liabilities of under $1.3 billion, and as of March 31, 2021, it had approximately $237 million in cash and cash equivalents on its consolidated balance sheet. A copy of Xperi’s consolidated balance sheet from its 2020 Form 10-K is attached hereto as Exhibit A. For a more comprehensive perspective, TiVo directs any party assessing TiVo’s ability to perform its obligations to review and rely on the publicly available financial reporting found in Xperi’s Forms 10-K and 10-Q found on its website: https://investor.xperi.com/financials (see also the “Financials” pull down link near the top of that webpage).
TiVo Assurances
TiVo has agreed to and is committed to close the transactions contemplated in the Purchase Agreement on June 1, 2021, assuming the Bankruptcy Court approves the transactions and no stay is in place at the time of the closing. TiVo also has agreed in the Purchase Agreement to pay cure amounts for all Transferred Contracts up to $4 million, which is a cap in excess of all cure amounts owing to the contract counterparties according to the Debtors’ books and records provided to TiVo. TiVo hereby reaffirms its agreement to pay such amounts in connection with the closing of the Sale. TiVo has ample cash availability to satisfy such $4 million obligation as well as the $17.4
2 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 13 of 22 DocuSign Envelope ID: 624BB6F2-03CB-47A8-92E8-F44CD0567B48Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 14 of 22
about the anticipated benefits of the transaction. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements and caution must be exercised in relying on forward-looking statements. Important risk factors that may cause such a difference include, but are not limited to: challenges in integration of Xperi and TiVo operations after the merger, anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenue, cost savings, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business strategies, and expansion and growth of the Company’s businesses; failure to realize the anticipated benefits of the recent merger with TiVo; the Company’s ability to implement its business strategy; pricing trends, including the Company’s ability to achieve economies of scale; the ability of the Company to retain and hire key personnel; potential adverse reactions or changes to business relationships resulting from the merger with TiVo; uncertainty as to the long-term value of the Company’s common stock; legislative, regulatory and economic developments affecting the Company’s business; general economic and market developments and conditions; failure to remediate the material weaknesses in our internal control over financial reporting; the evolving legal, regulatory and tax regimes under which the Company operates; unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism or outbreak of war or hostilities, and natural disasters; the extent to which the COVID-19 pandemic continues to have an adverse impact on our business, results of operations, and financial condition will depend on future developments, including measures taken in response to the pandemic, which are highly uncertain and cannot be predicted; and any plans regarding a potential separation of the combined business. These risks, as well as other risks associated with the business, are more fully discussed in the Company’s filings with the U.S. Securities and Exchange Commission (“SEC”), including the Company’s Annual Report on Form 10-K. While the list of factors presented here is, and the list of factors presented in the Company’s filings with the SEC are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on the Company’s consolidated financial condition, results of operations, liquidity or trading price of common stock. The Company does not assume any obligation to publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws.
4 DocuSign Envelope ID: 624BB6F2-03CB-47A8-92E8-F44CD0567B48Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 15 of 22
EXHIBIT A
2020 Consolidated Balance Sheet of Xperi Holding Corporation
(See attached)
5 Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 16 of 22
XPERI HOLDING CORPORATION CONSOLIDATED BALANCE SHEETS (in thousands, except for par value)
December 31, 2020 2019 ASSETS Current assets: Cash and cash equivalents $ 170,188 $ 74,551 Available-for-sale debt securities, at fair value (amortized cost and allowance for credit losses of $86,963 and $0, respectively, at December 31, 2020) 86,947 45,802 Equity securities — 1,124 Accounts receivable, net of allowance for credit losses of $7,336 and $566, respectively 115,975 24,177 Unbilled contracts receivable 132,431 121,826 Other current assets 40,763 13,735 Total current assets 546,304 281,215 Long-term unbilled contracts receivable 6,761 26,672 Property and equipment, net 63,207 32,877 Operating lease right-of-use assets 80,226 17,786 Intangible assets, net 1,004,379 232,275 Goodwill 847,029 385,784 Other long-term assets 153,270 71,336 Total assets $ 2,701,176 $ 1,047,945 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 13,045 $ 4,650 Accrued legal fees 5,783 1,316 Accrued liabilities 129,035 41,433 Current portion of long-term debt 43,689 — Deferred revenue 33,119 720 Total current liabilities 224,671 48,119 Deferred revenue, less current portion 39,775 — Long-term deferred tax liabilities 24,754 29,735 Long-term debt, net 795,661 334,679 Noncurrent operating lease liabilities 66,243 13,414 Other long-term liabilities 98,953 76,898 Total liabilities 1,250,057 502,845 Commitments and contingencies (Note 16) Company stockholders’ equity: Preferred stock: $0.001 par value; authorized (2020: 15,000 shares; 2019: 10,000 shares) and no shares issued and outstanding — — Common stock: $0.001 par value; (2020: authorized 350,000 shares, issued 110,182 shares, outstanding 104,775 shares; 2019: authorized 150,000 shares, issued 63,622 shares, outstanding 49,620 shares) 110 64 Additional paid-in capital 1,268,471 768,284 Treasury stock at cost (2020: 5,407 shares; 2019: 14,002 shares) (77,218) (368,701) Accumulated other comprehensive income (loss) 1,264 (53) Retained earnings 264,250 148,317 Total Company stockholders’ equity 1,456,877 547,911 Noncontrolling interest (5,758) (2,811) Total equity 1,451,119 545,100 Total liabilities and equity $ 2,701,176 $ 1,047,945
The accompanying notes are an integral part of these consolidated financial statements.
F-7 DocuSign Envelope ID: 624BB6F2-03CB-47A8-92E8-F44CD0567B48Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 17 of 22
EXHIBIT B
Parent Guaranty of Purchase Price Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 18 of 22
GUARANTY This Guaranty (this “Guaranty”), dated as of May 12, 2021, is made by Xperi Holding Corporation, a Delaware corporation (“Guarantor”), in favor of and for MobiTV, Inc., a Delaware corporation, and MobiTV Service Corporation, a Delaware corporation (collectively, “Sellers”). Reference is made to the Asset Purchase Agreement dated May 12, 2021 (the “Purchase Agreement”) by and among Sellers, on the one hand, and TiVo Corporation, a Delaware corporation (“Buyer”), on the other hand. Terms initially capitalized herein and not otherwise defined will have the meaning ascribed in the Purchase Agreement. Sellers are debtors and debtors in possession in cases filed under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Sellers’ chapter 11 bankruptcy cases are jointly administered in In re MobiTV, Inc., case no. 21- 10457-LSS (the “Cases”). Sellers and Buyer have entered into the Purchase Agreement in connection with a sale of the Purchased Assets (as defined in the Purchase Agreement) to be submitted for approval of the Court. Guarantor is entering into this Guaranty, in part, to demonstrate adequate assurances of future performance by Buyer pursuant to the Purchase Agreement if the Transactions (as defined in the Purchase Agreement) are approved by the Court. Guarantor is a public company listed on Nasdaq under ticker symbol XPER. It is the sole equity holder of Buyer. Guarantor will continue to be the direct 100% equity holder of Buyer under the foregoing structure until the Closing Date. Guarantor understands that, were it not for this Guaranty, Sellers would not have agreed to enter into the Purchase Agreement with Buyer, and hereby agrees as follows: 1. Guaranty. Guarantor hereby absolutely, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, the full and punctual payment by Buyer of the Purchase Price, less the Deposit, by wire transfer of immediately available funds to the Sellers’ Accounts at the Closing, under Section 1.7(a) of the Purchase Agreement (the “Obligation”). This Guaranty is a guaranty of payment and performance of the Obligation and not of collection. Sellers shall not be obligated to enforce or exhaust their remedies against Buyer or under the Purchase Agreement before proceeding to enforce this Guaranty. This Guaranty is a direct guaranty and independent of the obligations of Buyer under the Purchase Agreement. Sellers may resort to Guarantor for payment and performance of the Obligation whether or not Sellers shall have resorted to any collateral therefor or shall have proceeded against Buyer or any other guarantors with respect to the Obligation. Sellers may, at their option, proceed against Guarantor and Buyer, jointly and severally, or against Guarantor only without having obtained a judgment against Buyer. Notwithstanding the foregoing, Sellers may not enforce this Guaranty against Guarantor unless and until such time as Buyer has failed to initiate the delivery (and confirm such initiation in writing) to Sellers of the Purchase Price, less the Deposit, by wire transfer of immediately available funds to the Sellers’ Accounts at the Closing, under Section 1.7(a) of the Purchase Agreement on the Closing Date or at such other time or on such other date as may be mutually agreed by the Sellers and Buyer in writing, and on the conditions required thereunder. If and to the extent that this Guaranty is enforced by Sellers upon Buyer’s failure to fulfill the Obligation, Guarantor shall be entitled to all defenses, offsets, claims, and other rights to the same extent that Buyer would itself be entitled to under the terms of the Purchase Agreement related to the Obligation. Under no circumstances will Sellers be liable to both Buyer and
DB2/ 40824110.6 - 1 - Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 19 of 22
Guarantor, nor both Buyer and Guarantor be liable to Sellers, for the same amounts or claims hereunder.
2. Guaranty Absolute and Unconditional. Guarantor agrees that its Obligation under this Guaranty is irrevocable, continuing, absolute and unconditional and shall not be discharged or impaired or otherwise affected by, and except as provided otherwise in this Guaranty, Guarantor hereby irrevocably waives any defenses to enforcement it may have (now or in the future) by reason of: a. Any illegality, invalidity or unenforceability of the Obligation or the Purchase Agreement or any related agreement or instrument, or any law, regulation, decree or order of any jurisdiction or any other event affecting any term of the Obligations.
b. Any change in the time, place or manner of payment or performance of, or in any other term of the Obligation, or any rescission, waiver, release, assignment, amendment or other modification of the Purchase Agreement.
c. Any taking, exchange, substitution, release, impairment, amendment, waiver, modification or non-perfection of any collateral or any other guaranty for the Obligation, or any manner of sale, disposition or application of proceeds of any collateral or other assets to all or part of the Obligation.
d. Any default, failure or delay, willful or otherwise, in the performance of the Obligation.
e. Any change, restructuring or termination of the corporate structure, ownership or existence of Guarantor or Buyer or any insolvency, bankruptcy, reorganization or other similar proceeding affecting Buyer or its assets or any resulting restructuring, release or discharge of the Obligation.
3. Waivers and Acknowledgements. Guarantor further acknowledges and agrees as follows: a. Guarantor hereby unconditionally and irrevocably waives any right to revoke this Guaranty and acknowledges that this Guaranty is continuing in nature and applies to the presently existing and any future Obligation, until there is complete, irrevocable and indefeasible payment and satisfaction in full of the Obligation.
b. Guarantor hereby unconditionally and irrevocably waives promptness, diligence, notice of acceptance, presentment, demand for performance, notice of non- performance, default, acceleration, protest or dishonor and any other notice with respect to the Obligation and this Guaranty and any requirement that Sellers protect, secure, perfect or insure any lien or any property subject thereto.
4. Subrogation. Guarantor waives and shall not exercise any rights that it may acquire by way of subrogation, contribution, reimbursement or indemnification for payments made under this Guaranty until the Obligation has been indefeasibly paid and discharged in full.
DB2/ 40824110.6 - 2 - Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 20 of 22
5. Representations and Warranties. To induce Sellers to enter into the Purchase Agreement, Guarantor represents and warrants that: (a) Guarantor is a duly organized and validly existing corporation in good standing under the laws of the State of Delaware; (b) this Guaranty constitutes Guarantor’s valid and legally binding agreement in accordance with its terms except as may be limited by bankruptcy, insolvency or other Laws affecting creditors’ rights generally and by general equitable principles; (c) the execution, delivery and performance of this Guaranty have been duly authorized by all necessary action and will not violate any order, judgment or decree to which Guarantor or any of its assets may be subject; and (d) Guarantor is currently solvent and will not be rendered insolvent by providing this Guaranty.
6. Assignment. This Guaranty shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided, however, that Guarantor may not, without the prior written consent of Sellers, assign any of its rights, powers or obligations hereunder. Any attempted assignment in violation of this section shall be null and void.
7. Governing Law; Jurisdiction; Disputes. This Guaranty shall in all aspects be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware, and the obligations, rights and remedies of the parties shall be determined in accordance with such laws. For so long as Sellers are subject to the jurisdiction of the Bankruptcy Court, the parties irrevocably elect, as the sole judicial forum for the adjudication of any matters arising under or in connection with this Guaranty, and consent as to the foregoing to the exclusive jurisdiction of the Bankruptcy Court. After Sellers are no longer subject to the jurisdiction of the Bankruptcy Court, the parties irrevocably elect, as the sole judicial forum for the adjudication of any matters arising under or in connection with this Guaranty, and consent to the jurisdiction of, any state or federal court having competent jurisdiction located in Delaware. Sellers and Guarantor agree that in the event that there is a dispute between or an action brought by or against any Sellers, on the one hand, and Guarantor, on the other hand, then, upon the judgment in relation to such action, the prevailing party in such suit shall be entitled to collect its reasonable and documented costs and expenses (including court costs or reasonable and documented attorney fee) incurred in connection with such action.
8. Waiver of Jury Trial. GUARANTOR AND EACH SELLER IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY.
9. Cumulative Rights. Each right, remedy and power hereby granted to Sellers and Guarantor or allowed them by applicable law or other agreement shall be cumulative and not exclusive of any other, and may be exercised by Sellers and Guarantor at any time or from time to time.
DB2/ 40824110.6 - 3 - Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 21 of 22
10. Severability. If any provision of this Guaranty is to any extent determined by final decision of a court of competent jurisdiction to be unenforceable, the remainder of this Guaranty shall not be affected thereby, and each provision of this Guaranty shall be valid and enforceable to the fullest extent permitted by law.
11. Entire Agreement; Amendments; Headings; Effectiveness. This Guaranty constitutes the sole and entire agreement of Guarantor and Sellers with respect to the subject matter hereof and supersedes all previous agreements or understandings, oral or written, with respect to such subject matter. No amendment or waiver of any provision of this Guaranty shall be valid and binding unless it is in writing and signed, in the case of an amendment, by Sellers and Guarantor, or in the case of a waiver, by the party against which the waiver is to be effective. Section headings are for convenience of reference only and shall not define, modify, expand or limit any of the terms of this Guaranty. Delivery of this Guaranty by facsimile or in electronic format shall be effective as delivery of a manually executed original of this Guaranty.
12. Term; Termination. This Guaranty shall automatically terminate upon either the (a) payment and satisfaction in full of the Obligation or (b) termination of the Purchase Agreement pursuant to Section 8.1 thereof. Upon termination of this Guaranty, Sellers shall, upon Guarantor’s request, execute and deliver to Guarantor such documents as Guarantor may reasonably request to evidence such termination.
[SIGNATURE PAGE FOLLOWS]
DB2/ 40824110.6 - 4 - Case 21-10457-LSS Doc 269 Filed 05/19/21 Page 22 of 22
Intending to be legally bound as of the date first set forth above.
GUARANTOR
Dated: May 12, 2021 XPERI HOLDING CORPORATION
By: ______Paul E. Davis Chief Legal Officer and Corporate Secretary
Address:
2160 Gold Street San Jose, CA 95002
[SIGNATURE PAGE TO GUARANTY]