1
EXHIBIT 4.04
REGISTRATION RIGHTS AGREEMENT
FOR
COMMON STOCK
Dated March 11, 1997
by and among
FSC SEMICONDUCTOR CORPORATION,
STERLING HOLDING COMPANY, LLC,
NATIONAL SEMICONDUCTOR CORPORATION,
and
THE INVESTORS LISTED ON SCHEDULE A
2
REGISTRATION RIGHTS AGREEMENT FOR COMMON STOCK
This Registration Rights Agreement for Common Stock (the
"Agreement") is made and entered into March 11, 1997, by and among FSC
Semiconductor Corporation, a Delaware corporation (the "Company"), Sterling
Holding Company, LLC, a Delaware limited liability company ("Sterling"),
National Semiconductor Corporation, a Delaware corporation ("NSC"), and the
investors (the "Additional Investors") listed on Schedule A hereto. Sterling,
NSC and the Additional Investors are sometimes referred to herein collectively
as the "Investors" and each individually as the "Investor".
This Agreement is made pursuant to the Securities Purchase and
Holders Agreement (as hereinafter defined). In order to induce the Investors to
enter into the Securities Purchase and Holders Agreement, the Company has agreed
to provide the registration rights set forth in this Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following capitalized terms
shall have the following meanings:
"Affiliate" has the meaning set forth in Rule 12b-2
promulgated under the Exchange Act.
"Commission" means the Securities and Exchange
Commission.
"Common Stock" means the Class A Common Stock, par value $.01
per share, of the Company, including shares of Class A Common Stock issuable
upon the conversion of shares of Class B Common Stock, par value $.01 per share,
and as adjusted for any stock dividend or distribution payable thereon or stock
split, reverse stock split, recapitalization, reclassification, reorganization,
exchange, subdivision or combination thereof.
"Demand Registration" has the meaning set forth in
Section 4(a) of this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
3
"Person" means an individual, partnership, corporation, trust,
joint venture or unincorporated organization, or a government or agency or
political subdivision thereof.
"Prospectus" means the prospectus included in any Registration
Statement, including any prospectus subject to completion, and any prospectus as
amended or supplemented by any prospectus supplement with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Registration Statement and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference in such Prospectus.
"Public Offering" means a successfully completed underwritten
public offering pursuant to an effective registration statement under the
Securities Act (other than a Special Registration Statement) in respect of the
offer and sale of shares of Common Stock.
"Registration Expenses" means the costs and expenses of all
registrations and qualifications under the Securities Act, and of all other
actions the Company is required to take in order to effect the registration of
Registrable Securities under the Securities Act pursuant to this Agreement
(including all federal and state registration and filing fees, printing
expenses, fees and disbursements of counsel for the Company, the fees and
expenses of the Company's independent public accountants (including the expenses
of any special audit and "cold comfort" letters required by or incident to such
registration) and Securities and Exchange Commission, securities exchange and
NASD fees, fees and expenses to prepare and distribute the applicable
registration statement and fees and disbursements of one counsel selected by the
holder demanding registration if the registration is a Demand Registration or
otherwise by the holders of a majority of the Registrable Securities to be
registered) other than the costs and expenses of any Investors whose Registrable
Securities are to be registered pursuant to this Agreement comprising
underwriters' commissions, brokerage fees, transfer taxes or the fees and
expenses of any accountants or other representatives (including counsel except
as provided above) retained by any Investor.
"Registration Statement" means any registration statement of
the Company which covers any of the Registrable Securities
- 2 -
4
pursuant to the provisions of this Agreement, including the Prospectus,
amendments and supplements to such Registration Statement, including
post-effective amendments, all exhibits thereto and all material incorporated by
reference in such Registration Statement.
"Registrable Securities" has the meaning set forth in
Section 2 of this Agreement.
"Securities Act" means the Securities Act of 1933, as amended
from time to time.
"Securities Purchase and Holders Agreement" means the
Securities Purchase and Holders Agreement dated March 11, 1997 among the
Company, Sterling, the Additional Investors and the other signatories thereto.
"Special Registration Statement" means (i) a registration
statement on Forms S-8 or S-4 or any similar or successor form or any other
registration statement relating to an exchange offer or an offering of
securities solely to the Company's employees or security holders or (ii) a
registration statement registering a Unit Offering.
"Unit Offering" means a public offering of a combination of
debt and equity securities of the Company in which (i) not more than 20% of the
gross proceeds received for the sale of such securities is attributed to such
equity securities, and (ii) after giving effect to such offering, the Company
does not have a class of equity securities required to be registered under the
Exchange Act.
"underwritten registration or underwritten offering" means a
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
2. Registrable Securities. The securities entitled to the
benefits of this Agreement are the Registrable Securities. As used herein,
"Registrable Securities" means the shares of Common Stock that are issued and
outstanding on the date hereof and the shares of Common Stock that become issued
and outstanding after the date hereof; provided, however, that each share of
Common Stock shall cease to be a Registrable Security when (i) it has been
- 3 -
5
effectively registered under the Securities Act and disposed of in accordance
with the Registration Statement covering it; (ii) it is distributed to the
public pursuant to Rule 144 (or any similar provisions then in force) under the
Securities Act or otherwise if, as a result of or following any sale referred to
in this clause (ii), such shares become represented by a new certificate or
other evidence of ownership not bearing a legend as set forth in Section 3.3 of
the Securities Purchase and Holders Agreement (or other legend of similar
import) and not subject to any stop transfer order and no other restriction on
transfer exists under the Securities Act or (iii) it is eligible for resale
under Rule 144 (or other similar provisions then in force) under the Securities
Act and the aggregate number of shares held by the holder thereof constitutes
less than 1% of the shares of Common Stock then outstanding.
3. Incidental Registration.
(a) Right to Include Common Stock. If the Company at
any time proposes to register any of its Common Stock, or securities convertible
into or exchangeable for Common Stock under the Securities Act (other than on a
Special Registration Statement), whether or not for sale for its own account, it
will each such time give at least 40 days prior written notice (the "Notice") to
all holders of Registrable Securities of its intention to file a registration
statement under the Securities Act and of such holders' rights under this
Section 3. Upon the written request of any such holders of Registrable
Securities made within 20 days of the date of the Notice (which request shall
specify the aggregate number of the Registrable Securities to be registered and
will also specify the intended method of disposition thereof), the Company will
effect the registration under the Securities Act of all Registrable Securities
which the Company has been so requested to register by the holders thereof (an
"Incidental Registration"), to the extent required to permit the public
disposition (in accordance with such intended methods thereof) of the
Registrable Securities to be so registered; provided, that (i) if, any time
after giving written notice of its intention to register shares of Common Stock
and prior to the effective date of the registration statement filed in
connection with such registration, the Company shall determine for any reason
not to register the Company's Common Stock, the Company shall give written
notice of such determination to each holder of Registrable Securities and,
thereupon, shall be
- 4 -
6
relieved of its obligation to register any Registrable Securities in connection
with such registration (but not from its obligation to pay the Registration
Expenses in connection therewith); (ii) if a registration requested pursuant to
this Section 3 shall involve an underwritten public offering, any holder of
Registrable Securities requesting to be included in such registration may elect,
in writing at least 15 days prior to the effective date of the registration
statement filed in connection with such registration, not to register such
securities in connection with such registration; and (iii) if, at any time after
the 180-day or shorter period specified in Section 3(b), the sale of the
securities has not been completed, the Company may withdraw from the
registration on a pro rata basis (based on the number of Registrable Securities
requested by each holder of Registrable Securities to be so registered) the
Registrable Securities which the Company has been requested to register and
which have not been sold.
(b) Priority in Incidental Registrations. With
respect to Incidental Registrations that do not involve a Demand Registration
which is covered by Section 4 below, if a registration pursuant to Section 3(a)
involves an underwritten offering and the managing underwriter advises the
Company in writing that, in its opinion, the total number of shares of Common
Stock to be included in such registration, including the Registrable Securities
requested to be included pursuant to this Section 3, exceeds the maximum number
of shares of Common Stock specified by the managing underwriter that may be
distributed without adversely affecting the price, timing or distribution of
such shares of Common Stock, then the Company shall include in such registration
only such maximum number of Registrable Securities which, in the reasonable
opinion of such underwriter or underwriters, can be sold in the following order
of priority: (i) first, all of the shares of Common Stock that the Company
proposes to sell for its own account, if any, and (ii) second, the Registrable
Securities of the holder(s) of Registrable Securities requested to be included
in such Incidental Registration. To the extent that shares of Common Stock to be
included in the Incidental Registration must be allocated among the holders(s)
of Registrable Securities pursuant to clause (ii) above, such shares shall be
allocated pro rata among the holders(s) of Registrable Securities based on the
number of shares of Common Stock that such holders(s) of Registrable Securities
shall have requested to be included therein. Notwithstanding the foregoing,
- 5 -
7
if an Incidental Registration (whether or not it is a Demand Registration) is an
underwritten offering, the managing underwriter or underwriters may select
shares for inclusion, or exclude shares completely, in such Incidental
Registration on a basis other than a pro rata basis if, in the reasonable
opinion of such underwriter or underwriters, selection on such other basis, or
inclusion of such shares, would be material to the success of the offering.
(c) Expenses. The Company will pay all
Registration Expenses in connection with any registration of Registrable
Securities requested pursuant to this Section 3.
(d) Liability for Delay. The Company shall not be
held responsible for any delay in the filing or processing of a registration
statement which includes any Registrable Securities due to requests by holders
of Registrable Securities pursuant to this Section 3 nor for any delay in
requesting the effectiveness of such registration statement.
(e) Participation in Underwritten Registrations. No
holder of Registrable Securities may participate in any underwritten
registration hereunder unless such holder (i) agrees to sell his or its Common
Stock on the basis provided in any underwriting arrangements approved by the
persons who have selected the underwriter and (ii) accurately completes in a
timely manner and executes all questionnaires, powers of attorney, underwriting
agreements, opinions of counsel, escrow agreements, indemnification agreements
and other documents customarily required under the terms of such underwriting
arrangements.
4. Demand Registration
(a) Right to Demand Registration. Subject to Section
4(b) below, each of Sterling and NSC shall be entitled to make a written request
("Demand Registration Request") to the Company for registration with the
Commission under and in accordance with the provisions of the Securities Act of
all or part of the Registrable Securities owned by it (a "Demand Registration")
(which Demand Registration Request shall specify the intended number of
Registrable Securities to be disposed of by such holder and the intended method
of disposition thereof); provided, that (i) the Company may, if the Board of
Directors so determines in the exercise of its reasonable judgment that due to a
pending or
- 6 -
8
contemplated acquisition or disposition or public offering or other similar
transaction involving the Company it would be inadvisable to effect such Demand
Registration at such time, defer such Demand Registration for a single period
not to exceed 180 days, and (ii) if the Company elects not to effect the Demand
Registration pursuant to the terms of this sentence, no Demand Registration
shall be deemed to have occurred for purposes of this Agreement.
(b) Number of Demand Registrations. Sterling shall be
entitled to make one or more Demand Registration Requests at any time and from
time to time. NSC shall be entitled to make up to two Demand Registration
Requests at any time and from time to time beginning 180 days after the Company
has consummated a Public Offering (or otherwise has a class of equity securities
registered pursuant to Section 12 of the Exchange Act) provided that the Company
need not effect the Demand Registration unless such Demand Registration includes
at least 33% of the aggregate Registrable Securities held by NSC on the date
hereof (adjusted for any stock dividend, stock distribution, stock split,
reverse stock split, stock combination, recapitalization, reclassification,
subdivision, conversion or similar transaction). The Registration Expenses shall
be borne by the Company.
(c) Priority on Demand Registration. If any of the
Registrable Securities proposed to be registered pursuant to a Demand
Registration are to be sold in a firm commitment underwritten offering and the
managing underwriter or underwriters of a Demand Registration advise the Company
and the holders of such Registrable Securities in writing that in its or their
reasonable opinion the number of shares of Common Stock proposed to be sold in
such Demand Registration exceeds the maximum number of shares specified by the
managing underwriter that may be distributed without adversely affecting the
price, timing or distribution of the Common Stock, the Company shall include in
such registration only such maximum number of Registrable Securities which, in
the reasonable opinion of such underwriter or underwriters can be sold in the
following order of priority: (i) first, the Registrable Securities requested to
be included in such Demand Registration held by the party requesting such Demand
Registration; (ii) second, shares of Common Stock to be offered by the Company
in such Demand Registration and (iii) third, shares of Common Stock held by
other holders requested to be included in such Demand Registration, provided
that such amount shall be allocated among such other
- 7 -
9
holders on a pro rata basis based upon their respective percentage of ownership
of the total number of shares of Common Stock then outstanding.
5. Registration Procedures. If and whenever the Company is
required to effect or cause the registration of any Registrable Securities under
the Securities Act as provided in this Agreement, the Company will, as
expeditiously as reasonably possible:
(a) prepare and file with the Commission a
registration statement with respect to such Registrable Securities (with respect
to a Demand Registration, within 90 days of such demand (subject to Section
4(a))), and use its best efforts to cause such registration statement to become
effective, provided, however, that, subject to the provisions of Sections 3 or
4, as applicable, the Company may discontinue any registration of its securities
which is being effected pursuant to Sections 3 or 4 herein at any time prior to
the effective date of the registration statement relating thereto;
(b) prepare and file with the Commission 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 a period of not less than 180 days or such shorter
period which will terminate when all Registrable Securities covered by such
registration statement have been sold (but not before the expiration of the
90-day period referred to in Section 4(3) of the Securities Act and Rule 174
thereunder, if applicable) and comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such registration
statement;
(c) furnish to each seller of such Registrable
Securities such number of copies of such registration statement and of each such
amendment and supplement thereof (in each case including all exhibits), such
number of copies of the prospectus included in such registration statement
(including each preliminary prospectus and summary prospectus), in conformity
with the requirements of the Securities Act, and such other documents as
- 8 -
10
such seller may reasonably request in order to facilitate the disposition of the
Registrable Securities by such seller;
(d) use its best efforts to register or qualify such
Registrable Securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions as each seller shall request,
and do any and all other acts and things which may be necessary or advisable to
enable such seller to consummate the disposition in such jurisdictions of the
Registrable Securities owned by such seller in accordance with the intended
method of disposition; provided, however, that the Company shall not be required
to qualify generally to do business in any jurisdiction where it is not then so
qualified or to take any action which would subject it to general service of
process in any such jurisdiction where it is not then so subject or subject
itself to general taxation in any jurisdiction where it is not then so subject;
(e) immediately notify each seller of any Registrable
Securities covered by such registration statement, at any time when a prospectus
relating thereto is required to be delivered under the Act within the
appropriate period mentioned in clause (b) of this Section 5, of the Company
becoming aware that the prospectus included in such 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 the light of the circumstances then
existing, and as promptly as practicable, but in any event within ten days
prepare, file and furnish to all sellers a reasonable number of copies of an
amended or supplemental prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities, 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 and use
its best efforts to have any amended or supplemental prospectus declared
effective (if necessary);
(f) use its best efforts to list such Registrable
Securities on any securities exchange on which the Common Stock is then listed
or on NASDAQ if the Common Stock is then quoted on NASDAQ, if such Registrable
Securities are not already so listed or
- 9 -
11
quoted and if such listing is then permitted under the rules of such exchange or
NASDAQ, and provide an independent transfer agent and registrar for such
Registrable Securities covered by such registration statement not later than the
effective date of such registration statement;
(g) furnish to each seller of Registrable
Securities covered by such registration statement on the effective date of such
registration statement (or, if such registration involves an underwritten public
offering, dated the date of the closing under the underwriting agreement) a
signed counterpart, addressed to such seller (and the underwriters, if any) of:
(i) an opinion of counsel for the Company,
dated the effective date of such registration statement (or,
if such registration involves an underwritten public offering,
dated the date of the closing under the underwriting
agreement), in form and substance as is customarily given by
company counsel to the underwriter in an underwritten public
offering addressed to the seller of the Registrable Securities
and the managing underwriter, if any; and
(ii) a "comfort" letter, dated the effective
date of such registration statement (or, if such registration
involves an underwritten public offering, dated the date of
the closing under the underwriting agreement), signed by the
independent public accountants who have certified the
Company's financial statements included in such registration
statement, covering such matters with respect to such
registration statement as are customarily covered in
accountants' letters delivered to the underwriters in
underwritten offerings of securities (addressed to the sellers
of the Registrable Securities and the managing underwriter, if
any);
(h) make available for inspection by any seller of
such Registrable Securities covered by such registration statement, by any
underwriter participating in any disposition to be effected pursuant to such
registration statement and by any attorney, accountant or other agent retained
by any such seller or any such underwriter (individually, an "Inspector" and
collectively, the "Inspectors"), all pertinent financial and other records,
pertinent
- 10 -
12
corporate documents and properties of the Company as shall be reasonably
necessary to enable them to exercise their due diligence responsibility
(collectively, the "Records"), and cause all of the Company's officers,
directors and employees to supply all information reasonably requested by any
such seller, underwriter, attorney, accountant or agent in connection with such
registration; provided that any Records that are designated by the Company in
writing as confidential shall be kept confidential by the Inspectors unless (A)
the disclosure of such Records is necessary to avoid or correct a misstatement
or omission in such registration statement or (B) the release of such Records is
required by law or legal process in the written opinion of counsel. Each
Investor agrees that non-public information obtained by it as a result of such
Inspections shall be deemed confidential and acknowledges its obligations under
the Federal securities laws not to trade any securities of the Company on the
basis of material non-public information;
(i) in the event of any underwritten offering, enter
into and perform its obligations under an underwriting or placement agreement,
in usual and customary form, with the lead underwriter(s) of such offering and
take all such other actions in connection therewith in order to expedite or
facilitate the disposition of the Registrable Securities being sold in such
underwritten offering and in connection therewith (i) make such representations
and warranties to the lead underwriter(s) in form, substance and scope as are
customarily made by issuers to lead underwriter(s) in secondary offerings; and
(ii) deliver such documents and certificates as may be reasonably requested by
the selling holders and the lead underwriter(s) to evidence compliance with
clause (i) above and with any customary conditions contained in the underwriting
or placement agreement or other agreement entered into by the Company, as the
case may be. The above shall be done at each closing under such underwriting or
other agreement or as and to the extent required thereunder. The selling holders
participating in such underwriting shall also enter into and perform its
obligations under such an agreement, including furnishing any opinion of counsel
or entering into a hold-back agreement pursuant to Section 7;
(j) notify in writing the selling holders and the
lead underwriter(s), if any, promptly (i) of any request by the Commission for
amendments or supplements to any registration
- 11 -
13
statement or prospectus or for additional information, (ii) of the issuance by
the Commission of any stop order suspending the effectiveness of any
registration statement or the initiation of any proceedings for that purpose,
(iii) in the case of an underwritten offering, if at any time the
representations and warranties of the Company contemplated by Section 5(i) cease
to be true and correct, and (iv) of the receipt by the Company, as the case may
be, of any notification with respect to the suspension of the qualification of
the Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(k) if reasonably requested by the lead
underwriter(s) or a selling holder in connection with an underwritten offering
and if reasonably acceptable to the Company, promptly incorporate in a
prospectus supplement or post-effective amendment such information as the lead
underwriter(s) and the holders of a majority in interest of the Registrable
Securities being sold agree should be included therein, which such information
relates to the sale of the Registrable Securities, including, without
limitation, information with respect to the amount of Registrable Securities
being sold to or through such underwriter(s) and the purchase price being paid
therefor by such underwriter(s); and promptly make all required filings of such
prospectus supplement or post-effective amendment;
(l) cooperate with the selling holders and the lead
underwriter(s), if any, to facilitate the timely preparation and delivery of
certificates representing such securities and not bearing any restrictive
legends; and enable such securities to be
in such denominations and registered in such names as such holders or lead
underwriter(s) may request at least two business days prior to any sale of
Registrable Securities to the underwriters;
(m) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make generally available
to its security holders earnings statements satisfying the provisions of Section
11(a) of the Securities Act;
(n) make reasonable efforts to prevent the issuance
of any order suspending the effectiveness of a Registration Statement or of any
order preventing or suspending the qualification (or exemption from
qualification) of any of the
- 12 -
14
securities covered thereby for sale in any jurisdiction, and, if any such other
is issued, to obtain the withdrawal thereof as promptly as reasonably
practicable; and
(o) cooperate and assist in any filings to be made
with the NASD and (subject to compliance with clause (h)) in any reasonable due
diligence investigation by any "underwriter" (including any "qualified
independent underwriter" required to be retained in accordance with the rules
and regulations of the NASD).
The Company may require each seller of Registrable Securities
as to which any registration is being effected promptly to furnish to the
Company (i) an opinion of counsel for such seller dated the effective date of
the registration statement relating to such seller's Registrable Securities (or
if such registration involves an underwritten public offering, dated the date of
the closing under the underwriting agreement), reasonably satisfactory in form
and substance to the Company (and the managing underwriter, if any) and (ii)
such information regarding the distribution of such Registrable Securities as
may be legally required. Such information shall be furnished in writing and
shall state that it is being furnished for use in the registration statement.
Each holder of Registrable Securities agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from the Company of
the happening of any event of the kind described in clause (e) of this Section
5, such holder will forthwith discontinue disposition of Registrable Securities
pursuant to the registration statement covering such Registrable Securities
until such holder's receipt of the copies of the supplemented or amended
prospectus contemplated by clause (e) of this Section 5 (if required or until
receipt of notice from the Company that a supplemental or amended prospectus is
not required), and, if so directed by the Company, such holder will deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies then in such holder's possession, of the prospectus covering such
Registrable Securities current at the time of receipt of the Company's notice.
In the event the Company shall give any such notice, the period mentioned in
clause (b) of this Section 5 shall be extended by the number of days during the
period from and including the date of the giving of such notice pursuant to
clause (e) of this Section 5 and including the date when each seller of
Registrable Securities covered by such registration statement shall
- 13 -
15
have received the copies of the supplemented or amended prospectus contemplated
by clause (e) of this Section 5.
6. Indemnification.
(a) Indemnification by the Company. The Company
hereby agrees to indemnify and hold harmless each holder of Registrable
Securities which shall have been registered under the Securities Act, and such
holder's officers, directors, shareholders, partners and agents, each other
Person, if any, who controls such holder within the meaning of the Securities
Act and each other Person (including underwriters) who participates in the
offering of such Registrable Securities against any losses, claims, damages,
liabilities, reasonable attorneys' fees, costs or expenses (collectively, the
"Damages"), joint or several, to which such holder or controlling Person or
participating Person may become subject under the Securities Act, the Exchange
Act or otherwise, insofar as such Damages (or proceedings in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact made by the Company or its agents contained in any
registration statement under which such Registrable Securities are registered
under the Securities Act, in any preliminary prospectus or final prospectus
contained therein, or in any amendment or supplement thereof, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse such holder of Registrable Securities or such
controlling Person or participating Person in connection with investigating or
defending any such Damages or proceeding; provided, however, that the Company
will not be liable in any such case to the extent that any such Damages arise
out of or are based upon (i) an untrue statement or alleged untrue statement or
omission or alleged omission made in such registration statement, said
preliminary or final prospectus or said amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
holder or such controlling or participating Person, as the case may be,
specifically and expressly for use in the preparation thereof; or (ii) an untrue
statement or alleged untrue statement, omission or alleged omission in a
prospectus if such untrue statement or alleged untrue statement, omission or
alleged omission is corrected in an amendment or supplement to the prospectus
which amendment or supplement is delivered to such holder in a timely manner and
such
- 14 -
16
holder thereafter fails to deliver such prospectus as so amended or supplemented
prior to or concurrently with the sale of such Registrable Securities to the
Person asserting such Damages; provided, further, that in no event shall the
indemnification included under this clause (a) be at a level less than that
provided by the Company to the underwriters of the applicable offering.
(b) Indemnification by the Holders of Registrable
Securities Which Are Registered. Each holder, by its exercise of any benefit of
this Agreement, agrees that it will indemnify and hold harmless the Company, its
directors, officers and agents and each other Person, if any, which controls the
Company within the meaning of the Securities Act against any Damages, joint or
several, to which the Company, or such other Person or such Person controlling
the Company may become subject under the Securities Act, the Exchange Act or
otherwise, but only to the extent that such Damages (or proceedings in respect
thereof) arise out of or are based upon any untrue statements or alleged untrue
statement of any material fact contained, on the effective date thereof, in any
registration statement under which such Registrable Securities are registered
under the Securities Act, in any preliminary prospectus or final prospectus
contained therein or in any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, which, in each such case, has been made in or omitted from such
registration statement, said preliminary or final prospectus or said amendment
or supplement in reliance upon, and in conformity with, written information
furnished to the Company by such holder of Registrable Securities specifically
and expressly for use in the preparation thereof; provided, however, that in no
event shall the indemnification included under this clause (b) be at a level
greater than that provided by the Company to the underwriters of the applicable
offering in proportion to the proceeds to the Company and to such selling holder
of such offering. The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, to the same extent as provided
above, with respect to information furnished in writing by such Persons
specifically for inclusion in any prospectus or registration statement.
- 15 -
17
(c) Conduct of Indemnification Proceedings. Any
Person entitled to indemnification hereunder shall (i) give prompt written
notice to the indemnifying party of the commencement of any action or proceeding
involving a claim referred to in the preceding paragraphs of this Section 6; and
(ii) unless the indemnified party has been advised by its counsel that a
conflict of interest exists between such indemnified and indemnifying parties
under applicable standards of professional responsibility, with respect to such
claim, permit such indemnifying party to assume the defense of such claim with
counsel reasonably satisfactory to the indemnified party. Whether or not such
defense is assumed by the indemnifying party, the indemnifying party will not be
subject to any liability for any settlement made without its consent (but such
consent will not be unreasonably withheld). No indemnifying party will consent
to the entry of any judgment or enter into any settlement which does not include
as an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect of such claim or
litigation; provided, however, that no indemnifying party will consent to the
entry of any judgment or enter into any settlement (other than for the payment
of money only) without the consent of the indemnified party (which consent will
not be unreasonably withheld). An indemnifying party who is not entitled to, or
elects not to, assume the defense of the claim, will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other such indemnified parties with respect to such
claim, in which event the indemnifying party shall be obligated to pay the fees
and expenses of such additional counsel or counsels.
(d) Contribution. If for any reason the
indemnification provided for in the preceding Sections 6(a) or 6(b) is
unavailable to an indemnified party in respect of any Damages referred to
therein, the indemnifying party shall contribute to the amount paid or payable
by the indemnified party as a result of such Damages in such proportion as is
appropriate to reflect not only the relative benefits received by the
indemnified party and the indemnifying party, but also the relative fault of the
indemnified party and the indemnifying party, as well as any other relevant
equitable considerations. The relative fault of such indemnifying party and
indemnified parties shall be determined by reference to,
- 16 -
18
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, has been made by, or relates to information supplied by,
such indemnifying party or indemnified parties, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such action; provided, however, that in no event shall the liability of any
selling holder of Registrable Securities hereunder be greater in amount than the
difference between the dollar amount of the proceeds received by such holder
upon the sale of the Registrable Securities giving rise to such contribution
obligation and all amounts previously contributed by such holder with respect to
such Damages. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of fraudulent misrepresentation.
It is agreed that it would not be just and equitable if contributions pursuant
to this subsection 6(d) were determined by pro rata allocation or any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection 6(d).
7. Hold-Back Agreements
(a) Restrictions on Public Sale by Holder of
Registrable Securities. Each holder of Registrable Securities whose Registrable
Securities are eligible for inclusion in a Registration Statement filed pursuant
to Sections 3 or 4 agrees, if requested by the managing underwriter or
underwriters in an underwritten offering of any Registrable Securities, not to
effect any public sale or distribution of Registrable Securities, including a
sale pursuant to Rule 144 (or any similar provision then in force) under the
Securities Act (except as part of such underwritten registration), during the
10-day period prior to, and during the 180-day period (or such shorter period as
may be agreed to by the parties hereto) beginning on the effective date of such
Registration Statement, to the extent timely notified in writing by the Company
or the managing underwriter or underwriters.
The foregoing provisions shall not apply to any holder of
Registrable Securities if such holder is prevented by applicable statute or
regulation from entering into any such agreement; provided, however, that any
such holder shall undertake, in its request to participate in any such
underwritten offering, not to
- 17 -
19
effect any public sale or distribution of Registrable Securities (except as part
of such underwritten registration) during such period unless it has provided 45
days prior written notice of such sale or distribution to the managing
underwriter or underwriter.
(b) Restrictions on Public Sale by the Company and
Others. The Company shall (i) not effect any public sale or distribution of any
of its Common Stock for its own account during the 10-day period prior to, and
during the 180-day period beginning on, the effective date of a Registration
Statement filed pursuant to Sections 3 or 4 (except as part of a Special
Registration Statement), and (ii) use reasonable efforts to cause each holder of
Common Stock purchased from the Company at any time after the date of this
Agreement (other than in a registered public offering) to agree not to effect
any public sale or distribution of any such securities during such period,
including a sale pursuant to Rule 144 under the Securities Act (except as part
of such underwritten registration, if permitted).
8. Underwritten Registration
If any of the Registrable Securities covered by any Incidental
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering
will be selected by the Company and, in the case of a Demand Registration,
approved by the party making the Demand Registration Request.
Notwithstanding anything herein to the contrary, no Person may
participate in any underwritten registration hereunder unless such Person (a)
agrees to sell such Person's securities on the basis provided in any
underwritten arrangements approved by the Persons entitled hereunder to approve
such arrangement and (b) accurately completes and executes all questionnaires,
powers of attorney, indemnities, custody agreements, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
- 18 -
20
9. Miscellaneous
(a) Amendment and Modification. This Agreement may be
amended or modified, or any provision hereof may be waived, provided that such
amendment or waiver is set forth in a writing executed by (i) the Company, (ii)
Sterling (so long as Sterling and its Affiliates own in the aggregate at least
25% of the outstanding Common Stock on a fully diluted basis), (iii) NSC (so
long as NSC and its Affiliates own in the aggregate at least 5% of the
outstanding Common Stock on a fully-diluted basis), (iv) the holders of a
majority of the shares of the Registrable Securities held by Investors other
than Sterling, and (v) in the case of any amendment which materially and
adversely affects any Investor differently from any other Investor, such
Investor. No course of dealing between or among any persons having any interest
in this Agreement will be deemed effective to modify, amend or discharge any
part of this Agreement or any rights or obligations of any person under or by
reason of this Agreement.
(b) Survival of Representations and Warranties. All
representations, warranties, covenants and agreements set forth in this
Agreement will survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by an Investor or on its behalf.
(c) Successors and Assigns; Entire Agreement. This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns (including any Permitted Transferee under the Securities Purchase and
Holders Agreement) and executors, administrators and heirs. This Agreement sets
forth the entire agreement and understandings among the parties as to the
subject matter hereof and merges and supersedes all prior discussions and
understandings of any and every nature among them.
(d) Separability. In the event that any provision of
this Agreement or the application of any provision hereof is declared to be
illegal, invalid or otherwise unenforceable by a court of competent
jurisdiction, the remainder of this Agreement shall not be affected except to
the extent necessary to delete such illegal, invalid or unenforceable provision
unless that provision
- 19 -
21
held invalid shall substantially impair the benefits of the remaining portions
of this Agreement.
(e) Notices. All notices provided for or permitted
hereunder shall be made in writing by hand-delivery, registered or certified
first-class mail, telex, telecopier or air courier guaranteeing overnight
delivery to the other party at the following addresses (or at such other address
as shall be given in writing by any party to the others):
If to the Company to:
FSC Semiconductor Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel, mail stop 01-00
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with required copies to:
If to Sterling, to:
Citicorp Venture Capital Ltd.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇
with a required copy to:
Dechert Price & ▇▇▇▇▇▇
4000 ▇▇▇▇ Atlantic Tower
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: G. ▇▇▇▇▇▇ ▇'▇▇▇▇▇▇▇
If to an Individual Investor, at the most current address
given by such Individual Investor to the Company in accordance
with this Section 10(e), which address initially is, with
respect to each Additional Investor, the address set forth on
Schedule A hereto.
- 20 -
22
All such notices shall be deemed to have been duly given: when
delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; when confirmed, if telexed;
when receipt acknowledged, if telecopied; and on the next business day, if
timely delivered to an air courier guaranteeing overnight delivery.
(f) Governing Law. The validity, performance,
construction and effect of this Agreement shall be governed by and construed in
accordance with the internal law of Delaware, without giving effect to
principles of conflicts of law.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not constitute a part of this Agreement,
nor shall they affect its meaning, construction or effect.
(h) Counterparts. This Agreement may be executed in
two or more counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original, and all of
which taken together shall constitute one and the same instrument.
(i) Further Assurances. Each party shall cooperate
and take such action 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.
(j) Termination. Unless sooner terminated in
accordance with its terms, this Agreement shall terminate on the fifteenth
anniversary of the date of this Agreement; provided that the indemnification
rights and obligations set forth in Section 6 hereof shall survive the
termination of this Agreement.
(k) Remedies. In the event of a breach or a
threatened breach by any party to this Agreement of its obligations under this
Agreement, any party injured or to be injured by such breach, in addition to
being entitled to exercise all rights granted by law, including recovery of
damages, will be entitled to specific performance of its rights under this
Agreement, it being agreed by the parties that the remedy at law, including
monetary damages, for breach of such provision will be inadequate compensation
for any loss and that any defense in any action for
- 21 -
23
specific performance that a remedy at law would be adequate is waived.
(l) Party No Longer Owning Securities. If a party
hereto ceases to own any Securities, such party will no longer be deemed to be
an Investor for purposes of this Agreement; provided that the indemnification
rights and obligations set forth in Section 6 hereof shall survive any such
cessation of ownership.
(m) Pronouns. Whenever the context may require, any
pronouns used herein shall be deemed also to include the corresponding neuter,
masculine or feminine forms.
(n) No Effect on Employment. Nothing herein contained
shall confer on any Investor the right to remain in the employ of the Company or
any of its subsidiaries or Affiliates.
- 22 -
24
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.
FSC SEMICONDUCTOR CORPORATION
By:__________________________
Title: ______________________
STERLING HOLDING COMPANY, LLC
By:__________________________
Title:_______________________
NATIONAL SEMICONDUCTOR
CORPORATION
By:__________________________
Title:_______________________
- 23 -
25
ADDITIONAL INVESTORS:
-----------------------------
-----------------------------
-----------------------------
-----------------------------
-----------------------------
-----------------------------
- 24 -
26
SCHEDULE A
Name of Additional Investors Address
- 25 -
