<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 22, 1996.
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
AMATI COMMUNICATIONS CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 94-1675494
(State or other jurisdiction (I.R.S. employer
of incorporation or identification
organization) number)
</TABLE>
3801 ZANKER ROAD, SAN JOSE, CALIFORNIA 95150 (408) 433-3300
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
JAMES E. STEENBERGEN
AMATI COMMUNICATIONS CORPORATION
3801 ZANKER ROAD, SAN JOSE, CALIFORNIA 95150
(408) 433-3300
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
with copies of all orders, notices and communications to:
Richard A. Peers
Stephen C. Ferruolo
Heller Ehrman White & McAuliffe
525 University Avenue, Palo Alto, California 94301 (415) 324-7000
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the Registration Statement becomes effective.
------------------------
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. / /
------------------------
If any of the securities being registered on this Form are to be offered on a
delayed or continuous
basis pursuant to Rule 415 under the Securities Act of 1933, other than
securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. /X/
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED BE REGISTERED PER SHARE OFFERING PRICE FEE
<S> <C> <C> <C> <C>
Common Stock, $.20 par value.. 3,544,954 $5.50(1) $19,497,247(1) $6,724
</TABLE>
(1) Estimated solely for purpose of computing the amount of the registration fee
based on the average of the high and low prices of the Common Stock on the
Nasdaq National Market on February 20, 1996, as reported in THE WALL STREET
JOURNAL.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
AMATI COMMUNICATIONS CORPORATION
CROSS-REFERENCE SHEET BETWEEN ITEMS IN FORM S-3 AND
PROSPECTUS PURSUANT TO ITEM 501(B) OF REGULATION S-K
<TABLE>
<CAPTION>
ITEM NO. FORM S-3 CAPTION HEADING IN PROSPECTUS
- ---------- -------------------------------------------------- --------------------------------------------------
<S> <C> <C>
Item 1. Forepart of Registration Statement and Outside
Front Cover Page of Prospectus................... Outside Front Cover Page of Prospectus
Item 2. Inside Front and Outside Back Cover Pages of
Prospectus....................................... Available Information
Item 3. Summary Information, Risk Factors and Ratio of
Earnings to Fixed Charges........................ Recent Developments, Risk Factors
Item 4. Use of Proceeds................................... Use of Proceeds
Item 5. Determination of Offering Price................... Not Applicable
Item 6. Dilution.......................................... Not Applicable
Item 7. Selling Security Holders.......................... Selling Stockholders
Item 8. Plan of Distribution.............................. Plan of Distribution
Item 9. Description of Securities to be Registered........ Description of Capital Stock
Item 10. Interests of Named Experts and Counsel............ Legal Matters; Experts
Item 11. Material Changes.................................. Recent Developments
Item 12. Incorporation of Certain Information by
Reference........................................ Documents Incorporated by Reference
Item 13. Disclosure of Commission Position on
Indemnification for Securities Act Liabilities... Information Not Required in the Prospectus
</TABLE>
<PAGE>
PROSPECTUS
3,544,954 SHARES ALL OF WHICH ARE BEING
SOLD BY THE SELLING STOCKHOLDERS
AMATI COMMUNICATIONS CORPORATION
All of the 3,544,954 shares (the "Shares") of Common Stock, $.20 par value,
(the "Common Stock") of Amati Communications Corporation (the "Company") offered
by this prospectus (the "Prospectus") are being sold by the holders of the
Shares (each individually, a "Holder" and collectively, the "Selling
Stockholders") named in this Prospectus. See "Selling Stockholders." The Company
will not receive any of the proceeds from the sale of Shares by the Selling
Stockholders.
The Company has not made any underwriting arrangements with respect to the
Shares. The Company's Common Stock is traded on the Nasdaq National Market under
the symbol "AMTX". On February 20, 1996, the closing price for the Common Stock,
as reported on the Nasdaq National Market, was $5.62.
Shares covered by this Prospectus may be offered for sale from time to time
by the Selling Stockholders at such prices and on such terms as may then be
obtainable, in negotiated transactions, or otherwise. Each Holder has entered
into an agreement with the Company that restricts the right of such Holder to
offer or sell the Shares (each an "Affiliate's Agreement" and collectively the
"Affiliate's Agreements"). In addition, pursuant to a registration rights
agreement between the Selling Stockholders and the Company (the "Registration
Rights Agreement"), the Selling Stockholders have agreed to offer or sell the
Shares only during the period commencing three days after the date of a press
release announcing the Company's quarterly earnings and generally ending 45 days
after such date and any other periods the Company allows trading by its officers
and directors ("Window Periods"). Pursuant to the Registration Rights Agreement,
the Company has the right at any time not to open a Window Period or, during an
open Window Period, to suspend offers and sales of Shares. See "Plan of
Distribution."
This Prospectus may be used by the Selling Stockholders or by any
broker-dealer who may participate in sales of securities covered hereby. The
Selling Stockholders and the brokers and dealers through whom such sales are
effected may be deemed to be underwriters under the Securities Act of 1933, as
amended (the "Securities Act"). The Selling Stockholders will pay all
commissions, transfer taxes, and other expenses associated with the sales of
securities by them. Pursuant to the Registration Rights Agreement, the Company
has paid the expenses of the preparation of this Prospectus and the Company has
agreed to indemnify the Selling Stockholders against certain liabilities,
including liabilities arising under the Securities Act.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement under the Securities Act with respect to
the securities offered by this Prospectus. As permitted by the rules and
regulations of the Commission, this Prospectus does not contain all of the
information set forth in the Registration Statement and the exhibits and
schedules thereto. For further information with respect to the Company and the
securities offered hereby, reference is made to the Registration Statement and
the exhibits thereto, which may be examined without charge at the public
reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and copies of which may be obtained from
the Commission upon payment of the prescribed fees.
------------------------
SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK.
(SEE "RISK FACTORS.")
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is , 1996
<PAGE>
No dealer, salesman, or any other person has been authorized to give any
information or to make any representations or projections of future performance
other than those contained in this Prospectus, and any such other information,
projections, or representations, if given or made, must not be relied upon as
having been so authorized. The delivery of this Prospectus or any sale hereunder
at any time does not imply that the information herein is correct as of any time
subsequent to its date. This Prospectus does not constitute an offer to sell or
a solicitation of an offer to buy any of the securities offered hereby in any
jurisdiction where, and to any person to whom, it is unlawful to make such offer
or solicitation.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act") and in accordance therewith
files reports, proxy statements and other information with the Commission. Such
Registration Statement, reports, proxy statements and other information can be
inspected and copied at public reference facilities maintained by the Commission
at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. Copies of
such material can be obtained at prescribed rates from the Public Reference
Section of the Commission at such address. Such reports, proxy statements and
other information can also be inspected at the Commission's regional offices at
7 World Trade Center, Suite 1300, New York, New York 10048 and 500 West Madison,
Chicago, Illinois 60661, and at the offices of the Nasdaq Stock Market at 9513
Key West Avenue, Rockville, Maryland 20850-3389.
DOCUMENTS INCORPORATED BY REFERENCE
There are hereby incorporated in this Prospectus by reference the following
documents filed pursuant to the 1934 Act: (i) the Company's Annual Report on
Form 10-K for the fiscal year ended July 29, 1995; (ii) the Company's Quarterly
Report on Form 10-Q for the fiscal quarter ended October 28, 1995; (iii) the
Company's Proxy Statement for the Annual Meeting of Shareholders held on
December 9, 1994; (iv) the Company's Amendment No. 3 to Registration Statement
on Form S-4 (33-62023) filed with the Commission on October 16, 1995, relating
to the merger of the Company and the former Amati Communications Corporation;
(v) the Company's Current Report on Form 8-K for November 28, 1995, as amended;
and (vi) the description of the Company's securities contained in its form 8-A
Registration Statements filed pursuant to Section 12 of the 1934 Act.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the 1934 Act after the date of this Prospectus and prior to the
termination of the offering of the securities offered hereby shall be deemed to
be incorporated by reference in this Prospectus.
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus has been
delivered, upon the written or oral request of such person, a copy of any or all
of the documents referred to above which have been or may be incorporated in
this Prospectus by reference, other than exhibits to such documents which are
not specifically incorporated by reference into the information that this
Prospectus incorporates. Requests for such copies should be directed to: Amati
Communications Corporation, 3801 Zanker Road, San Jose, California 95150,
Attention: Investor Relations, Telephone (408) 433-3300.
2
<PAGE>
RECENT DEVELOPMENTS
On November 28, 1995 the Company, formerly ICOT Corporation, and the former
Amati Communications Corporation ("Old Amati"), a privately held Mountain View,
California based company, completed the merger (the "Merger") by which Old Amati
became a wholly-owned subsidiary of the Company. In connection with the Merger,
the Company's name was changed from "ICOT Corporation" to "Amati Communications
Corporation" and on November 29, 1995 the trading symbol for the Company's stock
on the Nasdaq National Market was changed to "AMTX". The Company's principal
business prior to the Merger was to develop, manufacture, market and service
network connectivity products for sales to end-users and original equipment
manufacturers; the business of Old Amati acquired in the Merger is the
development of advanced transmission systems utilizing Discrete Multi-tone
("DMT") technology to provide high speed transmission over copper and cable
media. In 1993, Old Amati's DMT technology was selected as the American National
Standards Institute ("ANSI") standard for Asymmetric Digital Subscriber Line
("ADSL") transmission and, as a result, is recognized as the United States
standard for ADSL. Under the terms of the Merger Agreement, the shareholders,
warrant holders and option holders of Old Amati acquired approximately 35%
(6,788,924) of the fully diluted shares of the Company. The Company is not
expected to operate profitably in the foreseeable future.
3
<PAGE>
RISK FACTORS
The information about the Company included or incorporated by reference
herein contains forward looking statements that involve risks and uncertainties,
including the risks detailed below. The Shares of Common Stock offered hereby by
the Selling Stockholders involve a high degree of risk and prospective
purchasers should carefully consider the following factors.
EXPECTED FUTURE LOSSES. Due in part to the Merger, the Company is not
expected to operate profitably in the foreseeable future. In fiscal 1994, Old
Amati incurred a loss of $864,900, and, in the first nine months of 1995, a loss
of $5,451,000. The Company expects to continue to incur losses in future years.
There can be no assurance that the Company will ever attain profitability. Any
long-term viability, profitability and growth from the Company's technology will
depend upon successful commercialization of products resulting from its research
and product development activities. Extensive additional research and
development will be required prior to commercialization of certain products.
There can be no assurance that the Company will be able to develop commercially
viable products from the technology, generate significant revenues and/or
achieve profitability.
NEED FOR ADDITIONAL CAPITAL. The Company's future capital requirements
depend on many factors, including sales levels, progress in research and
development programs, establishment of collaborative agreements, and costs of
manufacturing and commercialization activities. The Company secured a line of
credit for $1,200,000 as of January 27, 1996. It is likely that the Company will
seek additional funding through collaborative agreements or through public or
private sales of its securities. There can be no assurance that additional
funding will be available on acceptable terms, if at all. If adequate funds are
not available, the Company could be required to curtail significantly or defer,
temporarily or permanently, one or more of its research and development programs
or to obtain funds through arrangements that may require the Company to
relinquish certain technology or product rights.
MARKET FOR ADSL PRODUCTS STILL UNDER DEVELOPMENT; PRINCIPAL ADSL MARKET
OUTSIDE OF THE UNITED STATES. ADSL was developed to transmit digital video over
copper wire. Although the current infrastructure in the local distribution
networks of telephone companies is based on copper wire, there can be no
assurance that telephone companies will pursue the deployment of ADSL systems to
allow the transmission of digital video, data and voice or, if deployment
occurs, as to the volume and timing of such deployment. Significant deployment
may be prevented or delayed by a number of factors, including cost, regulatory
barriers, lack of programming content, lack of consumer demand and the
availability of alternative technologies. Access systems with high performance
broadband capability, such as the ADSL system, would be attractive to telephone
companies only to the extent that the telephone companies plan to offer
video-on-demand services which utilize the full feature of a high performance
local distribution network. Substantial amounts of time, effort and money will
be required to develop such programming content. There can be no assurance that
sufficient programming content for video-on-demand services will be developed to
justify deploying digital video transmission systems, or that programming
content will be both attractive to consumers and offered at prices that will
create a mass market. If such products are developed, and there is demand for
them, there can be no assurance that telephone companies will select ADSL over
competing technologies, such as fiber-to-the-curb, hybrid fiber-coaxial ("HFC"),
and wireless communications. Fiber-to-the curb, HFC and wireless systems have
greater bandwidth than the ADSL products being developed by the Company. Because
foreign telephone companies currently face less competition from cable companies
than telephone companies face in the United States, the Company believes that
its principal markets for ADSL will be outside the United States.
PRICE COMPETITIVENESS OF ADSL PRODUCTS. The Company believes that in order
to design and manufacture commercially acceptable ADSL products, cost
improvements beyond those available with current technology will be necessary.
The future success of the Company will depend, in part, on its ability to
develop ADSL products that compete effectively on the basis of price and
performance.
4
<PAGE>
Current prices are significantly higher than those that the Company believes
would be necessary for mass deployment of ADSL products. There can be no
assurance that the Company will be successful in developing ADSL products that
can be sold at prices low enough to be viable in the market.
RAPID TECHNOLOGICAL CHANGE; COMPETITION IN THE TELECOMMUNICATION
TRANSMISSION BUSINESS. Competition from existing companies, including major
communications companies, is expected to increase. Most of the Company's
competitors in the communications industry are more established, benefit from
greater market recognition and have greater financial, technical, production and
marketing resources than the Company. Some competitors are developing alternate
access technologies, such as HFC, fiber-to-curb and wireless systems, that may
prove technologically superior or more cost effective than the Company's
technology. There can be no assurance that developments by others will not
render the Company's products or technologies obsolete or noncompetitive or that
the Company will be able to keep pace with new technological developments.
COMPETITION IN THE PC TO MAINFRAME CONNECTIVITY BUSINESS. The PC to
Mainframe Connectivity market is highly competitive and is characterized by
rapid advances in technology which frequently result in the introduction of new
products with improved performance characteristics, thereby subjecting the
Company's products to the risk of technological obsolescence. The Company's
ability to compete is dependent on several factors, including reliability,
product performance, quality, features, distribution channels, name awareness,
customer support, product development capabilities, and the ability to meet
delivery schedules. The Company competes directly or indirectly, with a broad
range of companies, many of whom have significantly greater financial and other
resources. In addition, the Company is only competing for a limited and
declining segment of the PC-Connectivity market, which is itself declining and
expected to continue to decline. The Company expects revenues from its PC-
Connectivity business to continue to decline.
COMPETITION FOR VDSL STANDARDS. The Company expects to apply its DMT
technology to the development of Very High-Speed Digital Subscriber Lines
("VDSL") products for the transmission of digital video service in connection
with a fiber-optic backbone to cover the distance from this platform or node to
subscribers' homes over copper wire or coaxial cable. ANSI has not yet awarded
the standard for VDSL technology, and the competition for the ANSI standard for
VDSL is expected to be intense. AT&T, as well as other companies with greater
resources than the Company, are expected to compete for these standards. There
is no assurance that the Company's DMT technology will be successful in
obtaining the ANSI VDSL standard.
DEPENDENCE ON COMPLEMENTARY PRODUCTS. Widespread use of ADSL and VDSL
products for digital video service will depend on the commercial availability of
other products and components, including the video content, digital switches,
video servers, encode/decode equipment, and set-top boxes in subscribers' homes.
There can be no assurance that other suppliers will develop and market these
complementary components effectively or that these components, when combined
with the Company's ADSL and VDSL products, will be a cost-effective means of
transmitting video-on-demand or video dialtone.
DEPENDENCE ON LARGE CUSTOMERS AND SYSTEMS INTEGRATORS. The Company
typically expects to sell its telecommunication transmission products to large
telecommunications service companies which serve as integrators for the various
component systems that make up a video-on-demand or multimedia system. These
systems integrators in turn sell the systems to telephone companies for
distribution to their subscribers. The Company is largely dependent on these
systems integrators for the introduction of its products to field trials. There
can be no assurance that systems integrators will select the Company's products
for field trials or, if they do initially select the Company's products, that
they will continue to use them. In addition, telephone companies are generally
reluctant to deploy new technologies available only from a single source,
especially when the supplier is as relatively small as the Company, and often
require the availability of alternative sources before deploying a new
technology. This reluctance may put the Company at a competitive disadvantage
relative to some of its competitors. Further, acceptance of the Company's
products by these customers may require the
5
<PAGE>
Company to relinquish rights to its technology or products. There can be no
assurance, however, that even if the Company were to relinquish such rights to
its technology or products, telephone companies would deploy the Company's ADSL
or VDSL products.
CUSTOMER CONCENTRATION; RELIANCE ON SALES TO IBM. Sales to IBM for PC to
Mainframe connectivity and related products accounted for approximately 83%,
62%, 65% and 70% of the Company's net sales in fiscal 1992, 1993, 1994 and 1995,
respectively. The Company expects that IBM will continue to account for a
significant portion of the Company's future sales, although IBM is not obligated
to purchase any specified amount of products or to provide the Company with
binding forecasts of product purchases for any period. There can be no assurance
that IBM will continue to distribute and support the Company's products. The
Company's principal contract with IBM expires in December 1996. Further, IBM may
terminate its agreements with the Company upon 30 days' notice without a
significant penalty.
INTERNATIONAL BUSINESS. The Company expects that sales outside of the
United States will represent a significant portion of its future sales,
especially of the Company's ADSL products. Operations outside of the United
States are subject to various risks, including exposure to currency
fluctuations, the imposition of governmental controls, the need to comply with a
wide variety of foreign and United States export laws, political and economic
instability, trade restrictions, changes in tariffs and taxes, and longer
payment cycles typically associated with international sales. The inability of
the Company to design products to comply with foreign standards or any
significant or prolonged delay in the Company's international sales could have a
material adverse effect on the Company's future business and results of
operations.
REGULATORY MATTERS. Telephone companies, which constitute the initial
primary market for the Company's telecommunication transmission products, and
cable television companies, which may become a future market for such products,
are subject to extensive regulation by both the federal and state governments in
the United States and by foreign governments. Many of these regulations have the
effect of limiting the economic incentive of telephone companies to deploy new
technologies. Restrictions on telephone companies and cable television companies
may materially and adversely affect demand for the products of the Company.
Legislation recently passed by Congress that will significantly alter the
regulations on telephone companies and cable companies in the United States, and
there can be no assurance that such legislation will not adversely affect the
commercialization of the Company's products. In addition, both in the United
States and abroad, rates for telecommunications services are governed by tariffs
or licensed carriers that are subject to regulatory approval. These tariffs also
could have a material adverse affect on the demand for the Company's products.
DEPENDENCE ON SUPPLIERS AND THIRD-PARTY MANUFACTURERS. Certain key
components in the Company's products, such as integrated circuits, are currently
available only from single sources. The Company does not have any long-term
supply contracts with its sole source vendors and purchases these components on
a purchase order basis. In addition, certain components and subassemblies for
the Company's products have long lead times. While the Company seeks to
accurately forecast its requirements, inaccuracies in its forecast could result
in shortages or oversupplies of these components. The inability to obtain
sufficient quantities of sole source components or subassemblies as required, or
to develop alternative sources as required in the future, or inaccuracies in
forecasts for long lead time components or subassemblies could result in delays
or reductions in product shipments or product redesigns which would materially
and adversely affect the Company's business, operating results and financial
condition. In addition, increases in the prices of components for which the
Company does not have alternate sources could materially and adversely affect
the Company's operating results.
The Company intends to outsource its manufacturing operations to independent
third party manufacturers. There are risks associated with the use of
independent manufacturers, including unavailability of or delays in obtaining
adequate supplies of products and reduced control of manufacturing quality and
production costs. There can be no assurance that the Company's third party
6
<PAGE>
manufacturers will provide adequate supplies of quality products on a timely
basis. The inability to
obtain such products on a timely basis would have a material adverse effect on
the Company's business, operating results and financial condition.
PATENTS AND TRADE SECRETS. There can be no assurance that any patents owned
or controlled by the Company will provide commercially significant protection of
the Company's technology or ensure that the Company may not be determined to
infringe valid patents of others. The Company's patents have not been tested in
court, and the validity and scope of the Company's proprietary rights could be
challenged. The Company has also received foreign patents, but since the patent
laws of foreign countries differ from those of the United States, the degree of
protection afforded by any foreign patents may be different from that available
under U.S. patent laws.
The Company also relies on trade secrets and proprietary know-how which it
seeks to protect by confidentiality agreements with its collaborators, employees
and consultants. There can be no assurance that these agreements will not be
breached, that the Company will have adequate remedies for any breach or that
the Company's trade secrets and proprietary know-how will not otherwise become
known or be discovered by competitors.
THE COMPANY'S RSI LAWSUIT. The Company is a defendant in a suit brought in
November 1993 alleging repetitive stress injuries ("RSI") resulting from the use
of the Company's products claiming $1 million in compensatory and $10 million in
punitive damages. While the Company believes that the claim is without merit and
has tendered defense of the suit to its insurance carriers, there can be no
assurance that the suit will not have a material adverse effect on the financial
position or results of operations of the Company.
POSSIBLE VOLATILITY OF STOCK PRICE; SHARES ELIGIBLE FOR FUTURE SALE. The
market price of the Company's Common Stock has been and may continue to be
highly volatile. As a result of the Merger, the Company has issued a total of
5,197,638 additional shares of Common Stock to shareholders of Old Amati and
holders who exercised their Old Amati warrants effective as of the Merger.
1,050,000 of these shares will be held in escrow until November 28, 1996 to
indemnify the Company against damages and expenses arising from a breach of the
representations, warranties and covenants of Old Amati contained in the
agreements relating to the Merger. Pursuant to the Affiliate's Agreements, each
Holder (other than Dr. Cioffi) has agreed not to dispose of more than 25% of
such Holder's Common Stock before November 28, 1996 without the written
permission of the Company. Dr. Cioffi's Affiliate's Agreement provides that he
shall not, without the written permission of the Company, dispose of more than
25% of the common stock equivalents held by him (including Common Stock issuable
upon exercise of his outstanding stock options) before November 28, 1996, nor
more than 50% of such common stock equivalents before November 28, 1997. In
addition, sales of shares by certain Holders are subject to the volume
limitation of Rule 144. See "Plan of Distribution." Except for the foregoing,
the shares of Common Stock issued as a result of the Merger are freely
tradeable. Sales of Shares by the Selling Stockholders and sales of other Common
Stock by other shareholders of Old Amati, other current stockholders, many of
whom acquired their shares at prices significantly lower than the current market
price, and by option holders and warrant holders who exercise Company stock
options or warrants could have a depressive effect on the market price of the
Company's Common Stock. Additionally, future events, many of which will be
beyond the control of the Company, as well as expected quarterly fluctuations in
revenues and financial results, may have a significant impact on the market
price of the Company's Common Stock.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the Shares
by the Selling Stockholders.
7
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock by the Selling Stockholders as of
February 21, 1996, including the number of shares underlying stock options that
are exercisable within 60 days of such date, and as adjusted to reflect the sale
by Selling Stockholders of Shares offered by them by this Prospectus.
<TABLE>
<CAPTION>
COMMON STOCK COMMON STOCK
BENEFICIALLY OWNED BENEFICIALLY OWNED
PRIOR TO OFFERING (1) AFTER OFFERING
---------------------------- COMMON STOCK ----------------------
NUMBER PERCENT TO BE SOLD NUMBER PERCENT
--------------- ----------- -------------- --------- -----------
<S> <C> <C> <C> <C> <C>
John M. Cioffi (2)................................ 1,636,110(4) 9.21% 934,920 701,190 3.59%
James F. Gibbons (3).............................. 333,119(5) 1.94 239,627 93,492 *
Kim Maxwell....................................... 765,465 4.48 765,465 0 0
Nepenthe Group Profit Sharing Plan (FOB) Gerald A.
Marxman.......................................... 179,037 1.05 179,037 0 0
Nepenthe Group Profit Sharing Plan (FOB) Frank J.
Kocsis........................................... 71,871 * 71,871 0 0
Nepenthe Group Profit Money Purchase Plan (FOB)
Frank J. Kocsis.................................. 59,951 * 59,951 0 0
James F. Ottinger................................. 373,968 2.10 373,968 0 0
Stanford University............................... 584,325 3.42 584,325 0 0
University Ventures II............................ 408,562(6) 2.38 335,790 72,772 *
</TABLE>
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* Less than 1%
(1) Applicable percentage of ownership is based on 17,064,692 shares of Common
Stock outstanding as of February 20, 1996.
(2) Dr. Cioffi was the founder of Old Amati and served as Vice President of
Engineering, Chief Technical Officer and a director of Old Amati since 1991.
Dr. Cioffi has been a director and the Vice President of Engineering and
Chief Technical Officer of the Company since the Merger.
(3) Dr. Gibbons served as the Chairman of the Board of Directors of Old Amati
since 1992. He has been a director of the Company since the Merger and
Chairman of the Board of Directors since December, 1995. Dr. Gibbons serves
as a member of the Compensation Committee.
(4) Includes 701,190 shares issuable upon exercise of outstanding options.
(5) Includes 93,492 shares issuable upon exercise of outstanding options.
(6) Includes 72,772 shares issuable upon exercise of outstanding warrant.
PLAN OF DISTRIBUTION
All or a portion of the Shares of Common Stock offered hereby by the Selling
Stockholders may be delivered and/or sold in transactions from time to time on
the over-the-counter market at prices prevailing at the time, at prices related
to such prevailing prices or at negotiated prices and/or may also be used to
cover any short positions previously established. The Selling Stockholders may
effect such transactions by selling to or through one or more broker-dealers,
and such broker-dealers may receive compensation in the form of underwriting
discounts, concessions or commissions from the Selling Stockholders. The Selling
Stockholders and any broker-dealers that participate in the distribution may
under certain circumstances be deemed to be "underwriters" within the meaning of
the Securities Act, and any commissions received by such broker-dealers and any
profits realized on the resale of Shares by them may be deemed to be
underwriting discounts and commissions under the Securities Act. The Selling
Stockholders may agree to indemnify such broker-dealers against certain
liabilities, including liabilities under the Securities Act. In addition, the
Company has agreed to
8
<PAGE>
indemnify the Selling Stockholders with respect to the Shares offered hereby
against certain liabilities, including, without limitation, certain liabilities
under the Securities Act, or, if such indemnity is unavailable, to contribute
toward amounts required to be paid in respect of such liabilities.
Any broker-dealer participating in such transactions as agent may receive
commissions from the Selling Stockholders (and, if they act as agent for the
purchaser of such Shares, from such purchaser). Broker-dealers may agree with
the Selling Stockholders to sell a specified number of Shares at a stipulated
price per share, and, to the extent such a broker-dealer is unable to do so
acting as agent for the Selling Stockholders, to purchase as principal any
unsold Shares at the price required to fulfill the broker-dealer commitment to
the Selling Stockholders. Broker-dealers who acquire Shares as principal may
thereafter resell such Shares from time to time in transactions (which may
involve crosses and block transactions and which may involve sales to and
through other broker-dealers, including transactions of the nature described
above) in the over-the-counter market, in negotiated transactions or otherwise
at market prices prevailing at the time of sale or at negotiated prices, and in
connection with such resales may pay to or receive from the purchasers of such
Shares commissions computed as described above. To the extent required under the
Securities Act, a supplemental prospectus will be filed, disclosing (a) the name
of any such broker-dealers, (b) the number of Shares involved, (c) the price at
which such Shares are to be sold, (d) the commissions paid or discounts or
concessions allowed to such broker-dealers, where applicable, (e) that such
broker-dealers did not conduct any investigation to verify the information set
out or incorporated by reference in this prospectus, as supplemented, and (f)
other facts material to the transaction.
The Selling Stockholders will pay all commissions, transfer taxes, and other
expenses associated with the sale of securities by them. The Shares offered
hereby are being registered pursuant to contractual obligations of the Company,
and the Company has paid the expenses of the preparation of this Prospectus.
The Selling Stockholders' rights to offer or sell the Shares are restricted
by the Affiliate's Agreements and the Registration Rights Agreement. In
addition, sales of shares by Drs. Gibbons and Cioffi are subject to the volume
limitations and manner-of-sale requirements of Rule 144.
The Affiliate's Agreements provide that each Holder (other than Dr. Cioffi)
shall not, without the written permission of the Company, sell or otherwise
dispose of more than 25% of such Common Stock before November 28, 1996. Dr.
Cioffi's Affiliate's Agreement provides that he shall not, without the written
permission of the Company, sell or otherwise dispose of more than 25% of the
common stock equivalents held by him (including Common Stock issuable upon
exercise of his outstanding stock options) before November 28, 1996, nor more
than 50% of such common stock equivalents before November 28, 1997.
Pursuant to the Registration Rights Agreement, the Selling Stockholders have
agreed that, throughout the period of the Registration Statement, of which this
Prospectus forms a part, Selling Stockholders shall only offer or sell Shares
during open Window Periods and in accordance with the trading clearance
procedure set forth in the Registration Rights Agreement. The trading clearance
procedure requires that, during any Window Period, a Selling Stockholder
proposing to offer or sell pursuant to the Registration Statement, of which this
Prospectus forms a part, must send a clearance form to the Company at least two
(2) business days prior to the date the Selling Stockholder proposes to sell
Shares, requesting that the Company clear the trade. The Company shall reply to
such Selling Stockholder within two (2) business days following receipt of the
clearance form, and in the reply shall either confirm that the Window Period
remains open and that the sale can be made, or notify the Selling Stockholder
that trading is suspended (and indicating, if practicable, the expected date
when such suspension shall end). If the reply confirms an open Window Period,
the Selling Stockholder is permitted to offer and sell Shares during the Window
Period, unless the Company informs the Selling Stockholder that the Window
Period has been closed. Clearance must be obtained each time a Selling
Shareholder intends to offer or sell Shares.
9
<PAGE>
The Company has the right at any time not to open a Window Period or, during
an open Window Period, to suspend offers and sales of Shares whenever, and for
so long as, in the reasonable judgment of the Company there is or may be in
existence material undisclosed information or events with respect to the
Company.
DESCRIPTION OF CAPITAL STOCK
As of the date of this Prospectus, the authorized capital stock of the
Company consists of 45,000,000 shares of Common Stock, $.20 par value ("Common
Stock"), and 5,000 shares of Preferred Stock, $100 par value ("Preferred
Stock").
COMMON STOCK
As of February 20, 1996, there were 17,064,692 shares of Common Stock
outstanding held of record by 1,704 stockholders. The holders of shares of
Common Stock are entitled to one vote per share on all matters to be voted on by
stockholders, except that holders may cumulate their votes in the election of
directors. Subject to preferences that may be applicable to any outstanding
Preferred Stock, holders of Common Stock are entitled to receive ratably such
dividends as may be declared by the Board of Directors in its discretion from
funds legally available therefor. In the event of a liquidation, dissolution, or
winding up of the Company, holders of Common Stock are entitled to share ratably
in all assets remaining after payment of liabilities and the liquidation
preference of any outstanding Preferred Stock. Holders of Common Stock have no
preemptive rights and have no rights to convert their Common Stock into any
other securities. The outstanding shares of Common Stock are fully paid and
nonassessable.
PREFERRED STOCK
The Board of Directors has the authority to issue up to 5,000 shares of
Preferred Stock in one or more series and to fix the rights, preferences,
privileges and restrictions thereof, including dividend rights, conversion
rights, voting rights, terms of redemption, liquidation preferences and the
number of shares constituting any series or the designation of such series,
without any further vote or action by the shareholders. The issuance of
Preferred Stock may have the effect of delaying, deferring or preventing a
change in control of the Company or making removal of management more difficult
without further action by the shareholders and could adversely affect the rights
and powers, including voting rights, of the holders of Common Stock. This could
have the effect of decreasing the market price of the Common Stock. The Company
has no present plans to issue any additional shares of Preferred Stock.
LEGAL MATTERS
The legality of the issuance of the securities being offered hereby is being
passed upon for the Company by Heller Ehrman White & McAuliffe, Palo Alto,
California.
EXPERTS
The audited financial statements and schedules of the Company at July 31,
1993, July 30, 1994 and July 29, 1995 and for each of the three years in the
period ended July 29, 1995 incorporated by reference herein and in the related
Registration Statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and are
incorporated by reference herein in reliance upon the authority of said firm as
experts.
The financial statements of Old Amati at December 31, 1993 and 1994 and for
the three years ended in the period ended December 31, 1994 incorporated by
reference herein and in the Registration Statement have been audited by Ernst &
Young LLP, independent auditors, and are included in reliance upon such report
given upon the authority of such firm as experts in accounting and auditing.
10
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth various expenses in connection with the sale
and distribution of the securities being registered. All of the amounts shown
are estimates except for the Securities and Exchange Commission Registration
Fee.
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee............... $ 6,724
Accounting Fees................................................... 1,000
Printing Costs, Legal Fees and Disbursements...................... 20,000
Miscellaneous..................................................... 276
---------
TOTAL:........................................................ $ 28,000
---------
---------
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
The Company has the power to indemnify its officers and directors against
liability for certain acts pursuant to Section 145 of the General Corporation
Law of the State of Delaware. The Restated Certificate of Incorporation of the
Company provides that a director of the Company, to the full extent permitted by
the Delaware General Corporation Law, shall not be liable to the Company or its
stockholders for monetary damage for breach of fiduciary duty as a director.
Article IX of the Company's Bylaws provides for the indemnification of
officers, directors, employees and agents of the Company. The Bylaws provide
that the Company shall indemnify its directors, officers, employees and agents
against expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by them in connection with any threatened, pending, or
completed action, suit or proceeding (other than an action by or in the right of
the corporation), if they acted in good faith and in a manner they reasonably
believe to be in or not opposed to the best interest of the corporation and had
no reasonable cause to believe the conduct was unlawful. In relation to a
proceeding by or in the right of the Company, a director, officer, employee or
agent shall be indemnified against expenses actually and reasonably incurred in
connection with the defense or settlement of such proceeding if the director,
officer, employee or agent acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of the
corporation, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his or her duty to the
corporation unless and only to the extent that the Delaware Court of Chancery
shall determine that such person is fairly and reasonably entitled to indemnity.
The Bylaws also provide that expenses incurred by a director, officer, employee
or agent may be advanced by the Company upon receipt of an undertaking by or on
behalf of the director, officer, employee or agent to repay such amount unless
it shall ultimately be determined that he or she is entitled to be indemnified
by the Company as authorized in the Bylaws.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ----------- -----------------------------------------------------------------------------------
<C> <S>
5 Opinion of Heller Ehrman White & McAuliffe*
10.1 Registration Rights Agreement dated February 15, 1996
10.2 Form of Affiliate's Agreement
10.3 Affiliate's Agreement of Dr. John M. Cioffi dated November 20, 1995
23.1 Consent of Heller Ehrman White & McAuliffe* (included in Exhibit 5)
23.2 Consent of Arthur Andersen LLP
</TABLE>
II-1
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ----------- -----------------------------------------------------------------------------------
23.3 Consent of Ernst & Young LLP
<C> <S>
24 Power of Attorney (See Page II-4)
</TABLE>
- ------------------------
*To be filed by amendment.
ITEM 17. UNDERTAKINGS.
A. The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement;
(i)
To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii)
To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the Registration Statement;
(iii)
To include any material information with respect to the plan of
distribution not previously disclosed in the Registration
Statement or any material change to such information in the Registration
Statement;
Provided, however, that paragraphs (i) and (ii) shall not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
B. That, for purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offering therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions described under Item 15
above, or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted against the Registrant by such Director, officer
or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in San Jose, State of California, on the 22nd day of February, 1996.
AMATI COMMUNICATIONS CORPORATION
By: _____/s/_JAMES E. STEENBERGEN_____
James E. Steenbergen
DIRECTOR, PRESIDENT, CHIEF
EXECUTIVE
OFFICER AND CHIEF FINANCIAL OFFICER
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints James E. Steenbergen or Terry Medel, or either of
them, with the power of substitution, her or his attorney in fact, to sign any
amendments to this Registration Statement (including post-effective amendments),
and to file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorney-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<C> <S> <C>
/s/ JAMES E. STEENBERGEN Director, President, Chief
- ------------------------------------ Executive Officer and Chief February 22, 1996
James E. Steenbergen Financial Officer
/s/ TERRY MEDEL Chief Accounting Officer
- ------------------------------------ (Principal Accounting Officer) February 22, 1996
Terry Medel
/s/ JOHN M. CIOFFI
- ------------------------------------ Director February 22, 1996
John M. Cioffi
/s/ JAMES F. GIBBONS
- ------------------------------------ Director February 22, 1996
James F. Gibbons
/s/ AAMER LATIF
- ------------------------------------ Director February 22, 1996
Aamer Latif
/s/ DONALD L. LUCAS
- ------------------------------------ Director February 22, 1996
Donald L. Lucas
</TABLE>
II-3
<PAGE>
AMATI COMMUNICATIONS CORPORATION
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY NUMBERED
EXHIBIT DESCRIPTION PAGES
- ----------- ------------------------------------------------------------------------------------- ---------------------
<C> <S> <C>
5 Opinion of Heller Ehrman White & McAuliffe*..........................................
10.1 Registration Rights Agreement dated February 15, 1996................................
10.2 Form of Affiliate's Agreement........................................................
10.3 Affiliate's Agreement of Dr. John M. Cioffi dated November 20, 1995..................
23.1 Consent of Heller Ehrman White & McAuliffe* (included in Exhibit 5)..................
23.2 Consent of Arthur Andersen LLP.......................................................
23.3 Consent of Ernst & Young LLP.........................................................
24 Power of Attorney (See Page II-4)....................................................
</TABLE>
- ------------------------
*To be filed by amendment.
<PAGE>
EXHIBIT 10.1
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made as of February
15, 1996, by and among Amati Communications Corporation, a Delaware corporation
(the "Company"), and the affiliates who have executed this Agreement (the
"Affiliates").
R E C I T A L S
A. The Company and the former Amati Communications Corporation, a California
corporation ("Old Amati"), entered into an agreement dated as of August
3, 1995, as amended (the "Merger Agreement"), providing for the merger (the
"Merger") of Old Amati with and into a wholly-owned subsidiary of the Company
pursuant to which the Affiliates received shares of the Company's Common Stock,
$0.20 par value (the "Common Stock"), in exchange for the shares of Old Amati
Common Stock and Preferred Stock they held on the effective date of the Merger
(the "Effective Date").
B. Pursuant to the Merger Agreement, each Affiliate has entered into an
agreement (the "Affiliate's Agreement") providing that such person not
offer or sell or otherwise dispose of any of the Common Stock issued to such
person in the Merger except (1) in compliance with the holding periods specified
in Rule 144 under the Securities Act (as defined below), and otherwise in
compliance with Rule 145 under the Securities Act, or (2) pursuant to a resale
prospectus under an effective registration agreement covering such resales; and
further restricting the Common Stock such person may sell during the first year
(and, in one case, the second year) following the Merger.
C. In connection with the Affiliate's Agreements, the Company and the
Affiliates desire to provide for the rights of the Affiliates with
respect registration of the Common Stock issued to them in the Merger for
resale.
THE PARTIES AGREE AS FOLLOWS:
1. CERTAIN DEFINITIONS.
As used in this Agreement, the following terms shall have the following
respective meanings:
(a) "COMMISSION" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
(b) "FORM S-3" shall mean Form S-3 issued by the Commission or any
substantially similar form then in effect.
(c) "HOLDER" shall mean any holder of outstanding Registrable Securities
which have not been sold to the public, but only if such holder is an
Affiliate or a transferee or assignee of Registration rights as permitted by
Section 4.
(d) The terms "REGISTER", "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration
statement in compliance with the Securities Act ("REGISTRATION STATEMENT"),
and the declaration or ordering of the effectiveness of such Registration
Statement.
(e) "REGISTRABLE SECURITIES" shall mean all Common Stock of the Company
issued to Affiliates in the Merger and any Common Stock issued
pursuant to stock splits, stock dividends and similar distributions with
respect to such shares.
(f) "REGISTRATION EFFECTIVE PERIOD" shall mean a period beginning the
date the Registration Statement becomes effective and ending on the
earlier of: (i) the date when Holders become eligible to sell the
Registrable Securities pursuant to Rule 144; or (ii) the date the
distribution described in the Registration Statement has been completed.
(g) "REGISTRATION EXPENSES" shall mean all expenses incurred by the
Company in complying with this Agreement, including, without
limitation, all federal and state registration, qualification and filing
fees, printing expenses, fees and disbursements of counsel for the Company,
fees
<PAGE>
and disbursements of one counsel for the selling Holders up to a maximum of
$2,500, blue sky fees and expenses, the expense of any special audits
incident to or required by any such registration, other than Selling
Expenses, and any expenses related to the maintenance of such Registration
and qualification during the Registration Effective Period.
(h) "SECURITIES ACT" shall mean the Securities Act of 1933, as amended,
or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
(i) "SELLING EXPENSES" shall mean all selling commissions applicable to
the sale of Registrable Securities pursuant to this Agreement, as
well as fees and disbursements of legal counsel for the selling Holders,
other than those expressly included in Registration Expenses.
(j) "WINDOW PERIOD" shall mean the period commencing three days after the
date of a press release announcing the Company's quarterly earnings
and generally ending 45 days after such date and any other periods the
Company allows trading by its officers and directors.
2. REGISTRATION.
2.1 REGISTRATION ON FORM S-3.
Subject to the terms of this Agreement, the Company shall use its
diligent efforts to effect Registration of the Registrable Securities by
filing as soon as possible after the date hereof a Form S-3 with the
Commission.
2.2 REGISTRATION OF OTHER SECURITIES.
Any Registration Statement filed under this Section 2 may include
securities of the Company other than Registrable Securities; provided,
however, that neither the Company nor any Holder shall be required to
utilize an underwriter in connection with the sale of their Registrable
Securities.
2.3 TRADING WINDOWS.
(a) Throughout the Registration Effective Period, Holders shall only
offer or sell Registrable Securities during Window Periods and in
accordance with the trading clearance procedure set forth below.
(b) During any Window Period, a Holder proposing to offer or sell
Registrable Securities pursuant to the Registration Statement shall
send a copy of the completed clearance form (to be provided to the Holder
under Section 2.3(d)) to the Company by facsimile (408-433-0260), addressed
to the attention of the Secretary/Treasurer, at least two (2) business days
prior to the date the Holder proposes to sell Registrable Securities,
requesting that the Company clear the trade. The Company shall reply to such
Holder by facsimile within two (2) business days following receipt of the
clearance form, and in the reply shall either confirm that the Window Period
remains open and that the sale can be made, or notify the Holder that
trading is suspended (and indicating, if practicable, the expected date when
such suspension shall end). If the reply confirms an open Window Period, the
Holder is permitted to offer and sell Registrable Securities during that
Window Period, unless the Company notifies the Holder by facsimile that the
Window Period has been closed pursuant to Section 2.3(c) below. Clearance in
accordance with this Section must be obtained each time a Holder intends to
offer or sell Registrable Securities.
(c) Notwithstanding any other provision of this Section 2.3, the Company
shall have the right at any time not to open a Window Period or,
during an open Window Period, to suspend offers and sales of Registrable
Securities whenever, and for so long as, in the reasonable judgment of the
Company there is or may be in existence material undisclosed information or
events with respect to the Company. The Company shall promptly provide
Holders with notice of such suspension and shall use all reasonable efforts
to minimize the length of the suspension.
2
<PAGE>
(d) Prior to the effectiveness of the Registration Statement, the Company
shall provide to each Holder an information sheet summarizing the
Registration rights set forth herein and indicating the anticipated dates of
the Window Periods during the Registration Effective Period, and shall
include a form for use in requesting clearance of trades in accordance with
this Section 2.3.
2.4 BLUE SKY.
The Company will exercise its reasonable efforts to Register and qualify
the securities covered by the Registration Statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
appropriate for the distribution of such securities; provided, however,
that:
(a) the Company shall not be required to qualify to do business or to
file a general consent to service of process in any such states
or jurisdictions; and
(b) notwithstanding anything in this Agreement to the contrary, in
the event any jurisdiction in which the securities shall be
qualified imposes a non-waivable requirement that expenses incurred in
connection with the qualification of the securities be borne by selling
stockholders, such expenses shall be payable pro rata by selling
stockholders.
2.5 EXPENSES OF REGISTRATION.
All Registration Expenses incurred in connection with the Registration
on Form S-3 pursuant to this Agreement shall be borne by the Company. All
Selling Expenses shall be borne by the Holders incurred by them.
2.6 REGISTRATION PROCEDURES.
Subject to the other provisions of this Agreement, the Company shall, as
expeditiously as reasonably possible:
(a) prepare and file with the Commission a Registration Statement
with respect to such securities in accordance with Section 2.1
and use its diligent efforts to cause such Registration Statement to
become effective as promptly as possible thereafter and to remain
effective during the Registration Effective Period;
(b) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the prospectus
used in connection with such Registration Statement as may be necessary
to comply with the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration Statement;
(c) furnish to the Holders such reasonable number of copies of the
Registration Statement, preliminary prospectus and final
prospectus as they may request in order to facilitate the public offering
of such securities; and
(d) notify each Holder at any time when a prospectus relating thereto
is required to be delivered under the Securities Act of the
happening of any event as a result of which 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 is necessary to make the statements therein not
misleading in the light of the circumstances then existing.
2.7 ADDITIONAL INFORMATION AVAILABLE.
So long as the Registration Statement is effective covering the resale
of Registrable Securities owned by a Holder, the Company will furnish to the
Holder(s):
(a) as soon as practicable after it becomes available (but in the
case of the Company's Annual Report to stockholders, within 120
days after the end of each fiscal year of the Company), one copy of: (i)
its Annual Report to Stockholders (which Annual Report shall
3
<PAGE>
contain financial statements audited in accordance with generally
accepted accounting principles by a national firm of certified public
accountants); (ii) if not included in substance in the Annual Report to
Stockholders, its Annual Report on 10-K; (iii) if not included in
substance in its Quarterly Reports to Stockholders, its quarterly reports
on 10-Q; and (iv) a full copy of the particular Registration Statement
covering the Registrable Securities (the foregoing, in each case,
excluding exhibits); and
(b) upon the reasonable request of a Holder, all exhibits excluded by
the parenthetical to subparagraph (a) (iv) of this Section 2.7;
and the Company, upon the reasonable request of a Holder, will meet with
such Holder or a representative thereof, at the Company's headquarters,
to discuss all information relevant for disclosure in the Registration
Statement covering the Registrable Securities and will otherwise
cooperate with any Holder conducting an investigation for the purpose of
reducing or eliminating such Holder's exposure to liability under the
Securities Act, including reasonable production of information at the
Company's headquarters.
2.8 INFORMATION FURNISHED BY HOLDER.
It shall be a condition precedent of the Company's obligations under
this Agreement that each Holder of Registrable Securities included in any
Registration furnish to the Company such information regarding such Holder
and the distribution proposed by such Holder as the Company may reasonably
request.
2.9 INDEMNIFICATION.
(a) COMPANY'S INDEMNIFICATION OF HOLDERS.
To the extent permitted by law, the Company will indemnify each
Holder, each of its officers, directors and constituent partners, legal
counsel for the Holders, and each person controlling such Holder, with
respect to which Registration, qualification or compliance of Registrable
Securities has been effected pursuant to this Agreement, and each
underwriter, if any, and each person who controls any underwriter against
all claims, losses, damages or liabilities (or actions in respect
thereof) to the extent such claims, losses, damages or liabilities arise
out of or are based upon any untrue statement (or alleged untrue
statement) of a material fact contained in any prospectus or other
document (including any related Registration Statement) incident to any
such Registration, qualification or compliance, or are based on any
omission (or alleged omission) to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, or any violation by the Company of the Securities Act, the
Securities Exchange Act of 1934, as amended (the "1934 Act"), or any
state securities law, or any rule or regulation promulgated under the
Securities Act, the 1934 Act or any state securities law, applicable to
the Company and relating to action or inaction required of the Company in
connection with any such Registration, qualification or compliance; and
the Company will reimburse each such Holder, each of its officers,
directors and constituent partners, and legal counsel, each such
underwriter, and each person who controls any such Holder or underwriter,
for any legal and any other expenses reasonably incurred, as incurred, in
connection with investigating or defending any such claim, loss, damage,
liability or action; provided, however, that the indemnity contained in
this Section 2.9(a) shall not apply to amounts paid in settlement of any
such claim, loss, damage, liability or action if settlement is effected
without the consent of the Company (which consent shall not unreasonably
be withheld); and provided, further, that the Company will not be liable
in any such case to the extent that any such claim, loss, damage,
liability or expense arises out of or is based upon any untrue statement
or omission based upon written information furnished to the Company by
such Holder, its officers, directors, constituent partners, or legal
counsel, underwriter, or controlling person and stated to be for use in
connection with the offering of securities of the Company.
4
<PAGE>
(b) HOLDER'S INDEMNIFICATION OF COMPANY.
To the extent permitted by law, each Holder shall indemnify the
Company, each of its directors and officers, each legal counsel and
independent accountant of the Company, each underwriter, if any, of the
Company's securities covered by a Registration Statement, each person who
controls the Company or such underwriter within the meaning of the
Securities Act, and each other such Holder, each of its officers,
directors and constituent partners and each person controlling such other
Holder, against all claims, losses, damages and liabilities (or actions
in respect thereof) arising out of or based upon any untrue statement (or
alleged untrue statement) of a material fact contained in any such
Registration Statement, prospectus, offering circular or other document
(including any related Registration Statement) incident to any such
Registration, qualification or compliance, or any omission (or alleged
omission) to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or any
violation by such Holder of the Securities Act, the 1934 Act or any state
securities law, or any rule or regulation promulgated under the
Securities Act, the 1934 Act or any state securities law, applicable to
such Holder and relating to action or inaction required of such Holder in
connection with any such Registration, qualification or compliance, in
each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission)
is made in a Registration Statement, prospectus, offering circular or
other document in reliance upon and in conformity with written
information furnished to the Company by such Holder and stated to be
specifically for use in connection with the offering of securities of the
Company; and shall reimburse the Company, such Holders, such directors,
officers, partners, persons, law and accounting firms, underwriters or
control persons for any legal and any other expenses reasonably incurred,
as incurred, in connection with investigating or defending any such
claim, loss, damage, liability or action, in each case to the extent, but
only to the extent, that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in a Registration
Statement, prospectus, offering circular or other document in reliance
upon and in conformity with written information furnished to the Company
by such Holder and stated to be specifically for use in connection with
the offering of securities of the Company; provided, however, that each
Holder's liability under this Section 2.9(b) shall not exceed such
Holder's proceeds from the offering of securities made in connection with
such Registration; and provided, further, that the indemnity contained in
this Section 2.9(b) shall not apply to amounts paid in settlement of any
such claim, loss, damage, liability or action if settlement is effected
without the consent of the Holder (which consent shall not unreasonably
be withheld).
(c) INDEMNIFICATION PROCEDURE.
Promptly after receipt by an indemnified party under this Section 2.9
of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against an indemnifying party
under this Section 2.9, notify the indemnifying party in writing of the
commencement thereof and generally summarize such action. The
indemnifying party shall have the right to participate in and to assume
the defense of such claim, jointly with any other indemnifying party
similarly noticed; provided, however, that the indemnifying party shall
be entitled to select counsel for the defense of such claim with the
approval of any parties entitled to indemnification, which approval shall
not be unreasonably withheld; provided further, however, that if either
party reasonably determines that there may be a conflict between the
position of the Company and the Holders in conducting the defense of such
action, suit or proceeding by reason of recognized claims for indemnity
under this Section 2.9, then counsel for such party shall be entitled to
conduct the defense to the extent reasonably determined by such counsel
to be necessary to protect the interest of such party. The failure to
notify an indemnifying party promptly of the commencement of any such
action, if prejudicial to the ability of the indemnifying party to defend
such action, shall
5
<PAGE>
relieve such indemnifying party, to the extent so prejudiced, of any
liability to the indemnified party under this Section 2.9, but the
omission so to notify the indemnifying party will not relieve such party
of any liability that such party may have to any indemnified party
otherwise other than under this Section 2.9.
3. REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934.
With a view to making available to the Holders the benefits of Rule 144 and
any other rule or regulation of the Commission that may at any time permit a
Holder to sell securities of the Company to the public without Registration or
pursuant to a Registration on Form S-3, the Company agrees to:
(a) make and keep public information available, as those terms are
defined in Rule 144;
(b) file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the
1934 Act; and
(c) furnish to any Holder, so long as such Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of Rule 144 or
that it qualifies as a registrant whose securities may be resold pursuant to
Form S-3, (ii) a copy of the most recent annual or quarterly report of the
Company and such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested in availing any
Holder of any rule or regulation of the Commission which permits the selling
of any such securities without registration.
4. TRANSFER OF RIGHTS.
The Registration rights of the Affiliates set forth in the Agreement may be
transferred or assigned by any Affiliate to a transferee or assignee of any
Registrable Securities not sold to the public acquiring at least fifty percent
(50%) of the shares of such Affiliate's Registrable Securities (equitably
adjusted for any recapitalization, stock split, combination, and the like) or
acquiring all of the Registrable Securities held by such Affiliate (hereinafter
referred to in this Section 4 as the "Transferee") if transferred to a single
entity; provided, however, that:
(a) the Company must receive written notice prior to the time of said
transfer, stating the name and address of the Transferee and
identifying the securities with respect to which such Registration rights
are being transferred or assigned, and
(b) the Transferee must not be a person deemed by the Board of Directors
of the Company to be a competitor or potential competitor of the
Company.
Notwithstanding the limitation set forth in the foregoing sentence
respecting the minimum number of shares which must be transferred, any Affiliate
which is a partnership may transfer such Affiliate's Registration rights to such
Affiliate's constituent partners (or may transfer to their heirs in the case of
individuals) without restriction as to the number or percentage of shares
acquired by any such constituent partner (or heirs).
5. MISCELLANEOUS.
5.1 ENTIRE AGREEMENT; AFFILIATE'S AGREEMENTS; SUCCESSORS AND ASSIGNS.
This Agreement and the Affiliate's Agreements constitute the entire
contract between the Company and the Affiliates relative to the subject
matter hereof. Any previous agreement between the Company and the Affiliates
concerning Registration rights is superseded by this Agreement; provided,
however, that the transfer limitations set forth in Sections 1(d) and 1(e)
of each Holder's Affiliate's Agreement shall remain in full force and
effect. Subject to the exceptions specifically set forth in this Agreement,
the terms and conditions of this Agreement shall inure to the benefit of and
be binding upon the respective executors, administrators, heirs, successors
and assigns of the parties.
6
<PAGE>
5.2 GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the
laws of the State of California applicable to contracts entered into and
wholly to be performed within the State of California by California
residents.
5.3 COUNTERPARTS.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
5.4 HEADINGS.
The headings of the Sections of this Agreement are for convenience and
shall not by themselves determine the interpretation of this Agreement.
5.5 NOTICES.
Except for notice of trade clearances which are to be provided in
accordance with Section 2.3(b), any notice required or permitted hereunder
shall be in writing and shall be deemed to have been duly given on the date
of delivery if delivered personally, on the date of electronic confirmation
of receipt if delivered by facsimile, or five days after the date of mailing
if mailed by first class mail, registered or certified, postage prepaid.
Notices which are to be provided under this Section shall be addressed (i)
if to the Company, as set forth below the Company's name on the signature
page of this Agreement, and (ii) if to an Affiliate, at such Affiliate's
address as set forth on the signature page hereto, or at such other address
as the Company or such Affiliate may designate by ten (10) days' advance
written notice to the Affiliates or to the Company, respectively.
5.6 AMENDMENT OF AGREEMENT.
Except as otherwise specifically provided herein, any provision of this
Agreement may be amended by a written instrument signed by the Company and
by persons holding more than two-thirds (2/3) of the then outstanding
Registrable Securities.
5.7 SEVERABILITY.
If any provision of this Agreement is held to be unenforceable for any
reason, it shall be adjusted rather than voided, if possible, in order to
achieve the intent of the parties to the extent possible. In any event, all
other provisions of this Agreement shall be deemed valid and enforceable to
the full extent possible.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
<TABLE>
<S> <C>
The COMPANY: AMATI COMMUNICATIONS CORPORATION
By: /s/ James Steenbergen
-------------------------------------------
Title: President and CEO
Address: P.O. Box 5143
3801 Zanker Road
San Jose, CA 95150
The AFFILIATES:
/s/ John M. Cioffi
------------------------------------------------
John M. Cioffi
Address: 7879 Creekline Rd.
Cupertino, CA 95014
</TABLE>
7
<PAGE>
<TABLE>
<S> <C>
/s/ James F. Gibbons
------------------------------------------------
James F. Gibbons
Address: 320 Tennyson Avenue
Palo Alto, CA 94301
/s/ Kim Maxwell
------------------------------------------------
Kim Maxwell
Address: 1057 University Avenue
Palo Alto, CA 94301
/s/ James F. Ottinger
------------------------------------------------
James F. Ottinger
Address: 16203 Greenwood Road
Monte Sereno, CA 95030
UNIVERSITY VENTURES II
By: CommTech International Management
Corp., General Partner of CommTech
International, its General Partner
By: /s/ Gerald A. Marxman, President
------------------------------------------------
General Partner
Address: 535 Middlefield Road,
Suite 200
Menlo Park, CA 94025
NEPENTHE GROUP PROFIT SHARING PLAN
(FOB) Gerald A. Marxman
/s/ Gerald A. Marxman, Trustee
------------------------------------------------
Gerald A. Marxman
Address: 535 Middlefield Road
Suite 200
Menlo Park, CA 94025
NEPENTHE GROUP PROFIT SHARING PLAN
(FOB) Frank J. Kocsis
/s/ Frank J. Kocsis
------------------------------------------------
Frank J. Kocsis
Address: 495 Darrell Road
Hillsborough, CA 94010
NEPENTHE GROUP PROFIT MONEY
PURCHASE PLAN (FOB) Frank J. Kocsis
/s/ Frank J. Kocsis
------------------------------------------------
Frank J. Kocsis
Address: 495 Darrell Road
Hillsborough, CA 94010
</TABLE>
8
<PAGE>
<TABLE>
<S> <C>
LELAND STANFORD JUNIOR UNIVERSITY
By: /s/ Harry A. Turner
-------------------------------------------
Name: Harry A. Turner
Title: Managing Director
Stanford Management Company
Address: 900 Welsh Road
Palo Alto, CA 94304
</TABLE>
9
<PAGE>
EXHIBIT 10.2
FORM OF AFFILIATE'S AGREEMENT
November , 1995
ICOT CORPORATION
P.O. BOX 5143
3801 Zanker Road
San Jose, California 95150
Ladies and Gentlemen:
Reference is made to the Amended and Restated Agreement and Plan of
Reorganization and Merger dated as of August 3, 1995, as amended by the
Amendment thereto dated as of October 6, 1995 (the "Agreement"), made and
entered into by and among ICOT Corporation, a Delaware corporation ("ICOT"),
Amati Communications Corporation, a California corporation ("Amati"), and IA
Acquisition Corporation, a California corporation and a wholly-owned subsidiary
of ICOT ("IAAC"). The Agreement provides for the merger of Amati with and into
IAAC (the "Merger") in a transaction in which shares of Amati Common Stock
("Amati Common") will be exchanged and converted into shares of ICOT Common
Stock ("ICOT Common"). To induce ICOT to enter into the Agreement and to effect
the Merger, I hereby agree to the terms of this Affiliate's Agreement.
I have been informed that the shares of ICOT Common which I will acquire in
connection with the Merger will not be registered for resale under the
Securities Act of 1933, as amended (the "Securities Act"); that the Merger
constitutes a transaction covered by Rule 145 of the Rules and Regulations of
the Securities and Exchange Commission (the "Commission") under the Securities
Act; that I may be deemed to be an "affiliate" of Amati within the meaning of
Rule 145; and that, accordingly, the shares of ICOT Common which I will acquire
in connection with the Merger may only be disposed of in compliance with the
holding periods specified in Rule 144 and otherwise in compliance with the
provisions of Rule 145 or pursuant to a resale prospectus under an effective
registration statement covering such resales and the other limitations described
herein.
I understand that the representations, warranties and agreements set forth
herein will be relied upon by counsel for ICOT and Amati in rendering opinions
regarding tax and other legal consequences of the Merger.
1. I represent, warrant and agree as follows:
(a) I have full power to execute this letter and to make the
representations, warranties and agreements herein and to perform my
obligations hereunder.
(b) APPENDIX A attached hereto sets forth all shares of Amati Common
owned by me, including all options or other rights to acquire Amati
Common and all equity securities (including any shares of preferred stock)
of Amati as to which I have sole or shared voting or investment power.
(c) I will not sell, transfer or dispose of any shares of ICOT Common
that I may acquire in connection with the Merger in exchange for the
shares of Amati Common owned by me, any securities which may be paid as a
dividend or otherwise distributed thereon or with respect thereto or issued
or delivered in exchange or substitution therefor or upon conversion thereof
or issued upon exercise of options to purchase ICOT Common held by me at the
effective time (the "Effective Time") of the Merger (which Effective Time I
understand is expected to be on or about November 20, 1995) (all such shares
and other securities being herein sometimes collectively referred to as
"Restricted Securities"), or any option, right or other interest with
respect to any Restricted Securities, unless such sale, transfer or
disposition is effected as provided in Section 3 hereof.
(d) Notwithstanding Section 1(c) hereof, within 90 days after the
Effective Time, I will not sell, transfer or dispose of any
Restricted Securities.
<PAGE>
ICOT CORPORATION
November , 1995
Page 2
(e) Without the written consent of ICOT, which consent shall not be
unreasonably withheld in the event of a transfer to a trust, I will
not in the period more than 90 days but less than one year after the
Effective Time, sell, transfer or otherwise dispose of any Restricted
Securities in excess of 25% of the number of shares of ICOT Common that I
acquire at the Effective Time in exchange for the shares of Amati Common
owned by me. I understand that any sale, transfer or disposition of
Restricted Securities under this Section 1(e) is also subject to the
restrictions set out in Section 3 hereof.
2. By countersigning below, ICOT agrees that it will: (i) until the second
anniversary of the Effective Time, file all reports required to be filed
under the Exchange Act of 1934, as amended, within the time period permitted;
and (ii) after the second anniversary of the Effective Time, use its best
efforts to file all reports and data with the Commission necessary to permit me
to sell Restricted Securities pursuant to and otherwise in conformity with Rule
145(d) under the Securities Act. I understand that, except as set forth in the
Registration Rights Agreement among ICOT, certain other affiliates of Amati and
me attached hereto as EXHIBIT A, ICOT is under no obligation to register the
sale, transfer, or other disposition of any Restricted Securities by or on
behalf of me or to take any other action necessary in order to make compliance
with an exception from registration available to me, other than as set forth
herein.
3. I understand that the provisions of Rule 144 restrict public resales of
Restricted Securities. I understand that I may publicly sell my
Restricted Securities only as follows:
(a) PURSUANT TO RULE 144: I understand Rule 144 permits public resales
of Restricted Securities only if I have beneficially owned the Restricted
Securities for at least two years and am not an affiliate of ICOT, and then
only (a) while ICOT meets the public information requirements of Rule
144(c), (b) in broker's transactions, (c) upon filing of a notice on Form
144 with the Securities and Exchange Commission, and (d) where the aggregate
number of Restricted Securities sold at any time together with all sales of
ICOT Common sold for my account during the preceding three-month period does
not exceed the greater of: (i) one percent of the ICOT Common outstanding;
or (ii) the average weekly volume of trading in ICOT Common on all national
securities exchanges and/or reported through the automated quotation system
of a registered securities association, during the four calendar week period
preceding any such sale.
(b) PURSUANT TO RULE 144(K): I understand I may make unrestricted
resales of Restricted Securities pursuant to Rule 144(k) if I have
beneficially owned the Restricted Securities for at least three years and am
not, and have not been for at least three months, an affiliate of ICOT.
By its countersignature below ICOT acknowledges that the provisions of
Section 1(c) of this Affiliate's Agreement will be satisfied, as to any sale by
me of Restricted Securities: (i) pursuant to Rule 144 under the Securities Act
while ICOT meets the public information requirements of Rule 144(c), by a
broker's letter with respect to that sale stating that each of the
above-described requirements of Rule 144 has been met or is inapplicable by
virtue of Rule 144(k); or (ii) in a transaction otherwise exempt from the
Securities Act; provided, however, that if counsel for ICOT reasonably believes
that the provisions of Rule 144 or the Securities Act have not been complied
with, and if requested by ICOT in connection with a proposed disposition other
than pursuant to a registered offering, I will furnish to ICOT a copy of a "no
action" letter or other communication from the staff of the SEC, or an opinion
of counsel in form and substance satisfactory to ICOT and its counsel, to the
effect that all of the applicable requirements of Rule 144 under the Securities
Act have been complied with or that the disposition may be otherwise effected in
the manner requested in compliance with the Securities Act.
<PAGE>
ICOT CORPORATION
November , 1995
Page 3
4. I also understand that stop transfer instructions will be given to ICOT's
transfer agent with respect to certificates evidencing the Restricted
Securities and that there will be placed on the certificates evidencing the
Restricted Securities a legend stating in substance:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS SET FORTH IN AN AGREEMENT BETWEEN THE REGISTERED HOLDER
THEREOF AND ICOT. THE AGREEMENT PROVIDES THAT THE SHARES MAY NOT BE
SOLD, TRANSFERRED OR DISPOSED OF UNLESS SUCH SALE, TRANSFER OR
DISPOSITION MEETS THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT
OF 1933 (THE "ACT") OR IS OTHERWISE EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE ACT. A COPY OF SUCH AGREEMENT IS ON FILE AT THE
PRINCIPAL OFFICES OF THE COMPANY.
By countersigning below ICOT agrees that such stop transfer instruction and
legend will be removed promptly if the provisions of this letter are complied
with or, upon request by the undersigned, after the third anniversary of the
Effective Time; provided, however, that ICOT reserves the right to impose stop
transfer instructions and legends on certificates with respect to shares held by
affiliates of ICOT to insure compliance with Rule 144 under the Securities Act
in the manner that ICOT generally takes such measures with respect to shares
held by its affiliates.
5. Once countersigned by ICOT, this letter shall be binding upon and
enforceable against me and my administrators, executors, representatives,
heirs, legatees and devisees and any pledgee holding Restricted Securities as
collateral.
6. I have carefully read this letter and have discussed its requirements and
other applicable limitations upon the sale, transfer, or other
disposition of the Restricted Securities and other ICOT securities owned by me
with my counsel to the extent I felt necessary.
Very truly yours,
By: __________________________________
Name:
Title:
Agreed to and accepted:
ICOT CORPORATION
By: __________________________________
Aamer Latif, President
<PAGE>
EXHIBIT 10.3
AFFILIATE'S AGREEMENT
November 20, 1995
ICOT CORPORATION
P.O. BOX 5143
3801 Zanker Road
San Jose, California 95150
Ladies and Gentlemen:
Reference is made to the Amended and Restated Agreement and Plan of
Reorganization and Merger dated as of August 3, 1995 as amended by the Amendment
thereto dated as of October 6, 1995 (the "Agreement") made and entered into by
and among ICOT Corporation, a Delaware corporation ("ICOT"), Amati
Communications Corporation, a California corporation ("Amati"), and IA
Acquisition Corporation, a California corporation and a wholly-owned subsidiary
of ICOT ("IAAC"). The Agreement provides for the merger of Amati with and into
IAAC (the "Merger") in a transaction in which shares of Amati Common Stock
("Amati Common") will be exchanged and converted into shares of ICOT Common
Stock ("ICOT Common"). To induce ICOT to enter into the Agreement and to effect
the Merger, I, John M. Cioffi, hereby agree to the terms of this Affiliates
Agreement.
I have been informed that the shares of ICOT Common which I will acquire in
connection with the Merger will not be registered for resale under the
Securities Act of 1933, as amended (the "Securities Act"); that the Merger
constitutes a transaction covered by Rule 145 of the Rules and Regulations of
the Securities and Exchange Commission (the "Commission") under the Securities
Act; that I may be deemed to be an "affiliate" of Amati within the meaning of
Rule 145; and that, accordingly, the shares of ICOT Common which I will acquire
in connection with the Merger may only be disposed of in compliance with the
holding periods specified in Rule 144 and otherwise in compliance with the
provisions of Rule 145 or pursuant to a resale prospectus under an effective
registration statement covering such resales and the other limitations described
herein.
I understand that the representations, warranties and agreements set forth
herein will be relied upon by counsel for ICOT and Amati in rendering opinions
regarding tax and other legal consequences of the Merger.
1. I represent, warrant and agree as follows:
(a) I have full power to execute this letter and to make the
representations, warranties and agreements herein and to perform my
obligations hereunder.
(b) APPENDIX A attached hereto sets forth all shares of Amati Common
owned by me, including all options or other rights to acquire Amati
Common and all equity securities (including any shares of preferred stock)
of Amati as to which I have sole or shared voting or investment power.
(c) I will not sell, transfer or dispose of any shares of ICOT Common
that I may acquire in connection with the Merger in exchange for the
shares of Amati Common owned by me, any securities which may be paid as a
dividend or otherwise distributed thereon or with respect thereto or issued
or delivered in exchange or substitution therefor or upon conversion thereof
or issued upon exercise of options to purchase ICOT Common held by me at the
effective time (the "Effective Time") of the Merger (which Effective Time I
understand is expected to be on or about November 20, 1995) (all such shares
and other securities being herein sometimes collectively referred to as
"Restricted Securities"), or any option, right or other interest with
respect to any Restricted Securities, unless such sale, transfer or
disposition is effected as provided in Section 3 hereof.
(d) Notwithstanding Section 1(c) hereof, within 90 days after the
Effective Time, I will not sell, transfer or dispose of any
Restricted Securities.
<PAGE>
ICOT CORPORATION
November 20, 1995
Page 2
(e) Without the written consent of ICOT, which consent shall not be
unreasonably withheld in the event of a transfer to a trust, I will
not (i) in the period up to one year after the Effective Time, sell,
transfer or otherwise dispose of any Restricted Securities in excess of 25%
of the number of shares of ICOT Common equal to the aggregate of the number
of shares of ICOT Common that I acquire at the Effective Time in exchange
for the shares of Amati Common owned by me plus the number of shares of ICOT
Common issuable to me within the two-year period following the Effective
Time upon exercise of fully-vested options to purchase ICOT Common
(together, the "Lock-up Securities") or (ii) in the period up to two years
after the Effective Time, sell, transfer or otherwise dispose of more than
50% of the Lock-up Securities. I understand that any sale, transfer or
disposition of Restricted Securities under this Section 1(e) is also subject
to the restrictions set out in Section 3 hereof.
2. By countersigning below, ICOT agrees that it will: (i) until the second
anniversary of the Effective Time, file all reports required to be filed
under the Exchange Act of 1934, as amended, within the time period permitted;
and (ii) after the second anniversary of the Effective Time, use its best
efforts to file all reports and data with the Commission necessary to permit me
to sell Restricted Securities pursuant to and otherwise in conformity with Rules
144 and 145 under the Securities Act. I understand that, except as set forth in
the Registration Rights Agreement among ICOT, certain other affiliates of Amati
and me attached hereto as EXHIBIT A, ICOT is under no obligation to register the
sale, transfer, or other disposition of any Restricted Securities by or on
behalf of me or to take any other action necessary in order to make compliance
with an exception from registration available to me, other than as set forth
herein.
3. I understand that the provisions of Rule 144 restrict public resales of
Restricted Securities. I understand that I may publicly sell my
Restricted Securities only as follows:
(a) PURSUANT TO RULE 144: I understand Rule 144 permits public resales
of Restricted Securities only if I have beneficially owned the Restricted
Securities for at least two years and am not an affiliate of ICOT, and then
only (a) while ICOT meets the public information requirements of Rule
144(c), (b) in broker's transactions, (c) upon filing of a notice on Form
144 with the Securities and Exchange Commission, and (d) where the aggregate
number of Restricted Securities sold at any time together with all sales of
ICOT Common sold for my account during the preceding three-month period does
not exceed the greater of: (i) one percent of the ICOT Common outstanding;
or (ii) the average weekly volume of trading in ICOT Common on all national
securities exchanges and/or reported through the automated quotation system
of a registered securities association, during the four calendar week period
preceding any such sale.
(b) PURSUANT TO RULE 144(K): I understand I may make unrestricted
resales of Restricted Securities pursuant to Rule 144(k) if I have
beneficially owned the Restricted Securities for at least three years and am
not, and have not been for at least three months, an affiliate of ICOT.
By its countersignature below ICOT acknowledges that the provisions of
Section 1(c) of this Affiliate's Agreement will be satisfied, as to any sale by
me of Restricted Securities: (i) pursuant to Rule 144 under the Securities Act
while ICOT meets the public information requirements of Rule 144(c), by a
broker's letter with respect to that sale stating that each of the
above-described requirements of Rule 144 has been met or is inapplicable by
virtue of Rule 144(k); or (ii) in a transaction otherwise exempt from the
Securities Act; provided, however, that if counsel for ICOT reasonably believes
that the provisions of Rule 144 or the Securities Act have not been complied
with, and if requested by ICOT in connection with a proposed disposition other
than pursuant to a registered offering, I will furnish to ICOT a copy of a "no
action" letter or other communication from the staff of the SEC, or an opinion
of counsel in form and substance satisfactory to ICOT and its counsel, to the
effect that all of the applicable requirements of Rule 144 under the Securities
Act have been complied with or that the disposition may be otherwise effected in
the manner requested in compliance with the Securities Act.
<PAGE>
ICOT CORPORATION
November 20, 1995
Page 3
4. I also understand that stop transfer instructions will be given to ICOT's
transfer agent with respect to certificates evidencing the Restricted
Securities and that there will be placed on the certificates evidencing the
Restricted Securities a legend stating in substance:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS SET FORTH IN AN AGREEMENT BETWEEN THE REGISTERED HOLDER
THEREOF AND ICOT. THE AGREEMENT PROVIDES THAT THE SHARES MAY NOT BE
SOLD, TRANSFERRED OR DISPOSED OF UNLESS SUCH SALE, TRANSFER OR
DISPOSITION MEETS THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT
OF 1933 (THE "ACT") OR IS OTHERWISE EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE ACT. A COPY OF SUCH AGREEMENT IS ON FILE AT THE
PRINCIPAL OFFICES OF THE COMPANY.
By countersigning below ICOT agrees that such stop transfer instruction and
legend will be removed promptly if the provisions of this letter are complied
with or, upon request by the undersigned, after the third anniversary of the
Effective Time; provided, however, that ICOT reserves the right to impose stop
transfer instructions and legends on certificates with respect to shares held by
affiliates of ICOT to insure compliance with Rule 144 under the Securities Act
in the manner that ICOT generally takes such measures with respect to shares
held by its affiliates.
5. Once countersigned by ICOT, this letter shall be binding upon and
enforceable against me and my administrators, executors, representatives,
heirs, legatees and devisees and any pledgee holding Restricted Securities as
collateral.
6. I have carefully read this letter and have discussed its requirements and
other applicable limitations upon the sale, transfer, or other
disposition of the Restricted Securities and other ICOT securities owned by me
with my counsel to the extent I felt necessary.
Very truly yours,
__________/s/_John M. Cioffi__________
John M. Cioffi
Agreed to and accepted:
ICOT CORPORATION
By: __________/s/_Aamer Latif_________
Aamer Latif, President
<PAGE>
APPENDIX A
TO
AFFILIATE'S AGREEMENT
200,000 shares of Common Stock
Options to purchase 150,000 shares of Common Stock
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included in or made a part of this
registration statement.
ARTHUR ANDERSEN LLP
San Jose, California
February 22, 1996
<PAGE>
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 33-00000) and the related prospectus of
Amati Communication Corporation (formerly ICOT Corporation) for the registration
of 3,544,954 shares of its common stock and to the incorporation by reference
therein of our reports dated April 14, 1995 (except for Note 11, as to which the
date is August 4, 1995) with respect to the financial statements of Amati
Communications Corporation ("Old Amati") included in the Registration Statement
(Form S-4 33-66023) Registration Statement of Amati Communications Corporation
(formerly ICOT Corporation) filed with the Securities and Exchange Commission.
Ernst & Young LLP
San Jose, California
February 21, 1996
