<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 17, 1995
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
--------------
BURR-BROWN CORPORATION
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 86-0445468
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
</TABLE>
6730 SOUTH TUCSON BOULEVARD
TUCSON, ARIZONA 85706
(520) 746-1111
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
--------------
SYRUS P. MADAVI
PRESIDENT AND CHIEF EXECUTIVE OFFICER
BURR-BROWN CORPORATION
6730 SOUTH TUCSON BOULEVARD
TUCSON, ARIZONA 85706
(520) 746-1111
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------
COPIES TO:
<TABLE>
<S> <C>
THOMAS W. KELLERMAN, ESQ. WILLIAM D. SHERMAN, ESQ.
ANDREW E. CHAU, ESQ. KEVIN A. FAULKNER, ESQ.
H. RICHARD HUKARI, ESQ. JUSTIN L. BASTIAN, ESQ.
Brobeck, Phleger & Harrison Morrison & Foerster
Two Embarcadero Place 755 Page Mill Road
2200 Geng Road Palo Alto, California 94304-1018
Palo Alto, California 94303-0913 (415) 813-5600
(415) 424-0160
</TABLE>
--------------
Approximate date of commencement of proposed sale to the public:
As soon as practicable on or after the effective date of this Registration
Statement.
--------------
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. / /
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
-------------------
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
-------------------
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
TITLE OF EACH CLASS OF PROPOSED MAXIMUM
SECURITIES TO BE AGGREGATE OFFERING PRICE AMOUNT OF REGISTRATION
REGISTERED (1) FEE (1)
<S> <C> <C>
Common Stock, par value
$.01 per share.......... $65,000,000 $22,413.79
</TABLE>
(1) Estimated solely for the purpose of calculating the amount of the
registration fee in accordance with Rule 457(o) promulgated under the
Securities Act of 1933.
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.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
SUBJECT TO COMPLETION, DATED AUGUST 17, 1995
PROSPECTUS
1,750,000 SHARES
[LOGO]
COMMON STOCK
All of the 1,750,000 shares of Common Stock offered hereby are being sold by
Burr-Brown Corporation. The Company's Common Stock is quoted on the Nasdaq
National Market under the symbol BBRC. On August 16, 1995, the last reported
sale price for the Common Stock was $32.00 per share. See "Price Range of Common
Stock."
--------------
THE SHARES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS" ON
PAGE 5.
--------------
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.
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT (1) COMPANY (2)
<S> <C> <C> <C>
Per Share.................................... $ $ $
Total (3).................................... $ $ $
<FN>
(1) See "Underwriting" for indemnification arrangements with the Underwriters.
(2) Before deducting expenses estimated at $250,000.
(3) The Company has granted to the Underwriters a 30-day option to purchase up
to 262,500 additional shares of Common Stock solely to cover
over-allotments, if any. If all such shares are purchased, the total Price
to Public, Underwriting Discount and Proceeds to the Company will be $ ,
$ and $ , respectively. See "Underwriting."
</TABLE>
--------------
The shares of Common Stock are offered by the several Underwriters, subject
to prior sale, receipt and acceptance by them and subject to the right of the
Underwriters to reject any order in whole or in part and certain other
conditions. It is expected that the certificates for the shares will be
available for delivery on or about September , 1995 at the office of the agent
of Hambrecht & Quist LLC in New York, New York.
HAMBRECHT & QUIST COWEN & COMPANY
September , 1995
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and at the Commission's
Regional Offices: Seven World Trade Center, 13th Floor, New York, New York
10048; and at Northwest Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material may be obtained at prescribed
rates from the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Judiciary Plaza, Washington, D.C. 20549. The Common Stock of the Company
is quoted on the Nasdaq National Market. Reports and other information
concerning the Company may be inspected at the offices of the Nasdaq Stock
Market at 1735 K Street, N.W., Washington, D.C. 20006.
Additional information regarding the Company and the shares offered hereby
is contained in the Registration Statement on Form S-3 and the exhibits thereto
(the "Registration Statement") and the exhibits thereto filed with the
Commission under the Securities Act of 1933, as amended (the "Act"). Statements
made in this Prospectus as to the contents of any referenced contract, agreement
or other document are not necessarily complete, and each such statement shall be
deemed qualified in its entirety by reference thereto. Copies of the
Registration Statement and the exhibits thereto may be obtained, upon payment of
the fee prescribed by the Commission, or may be examined without charge, at the
office of the Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington,
D.C. 20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission pursuant to the Exchange
Act are incorporated herein by reference except as superseded or modified
herein: (i) the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994; (ii) the Company's Quarterly Reports on Form 10-Q for the
fiscal quarters ended April 1, 1995 and July 1, 1995; (iii) the Company's Proxy
Statement for the Annual Meeting of Stockholders held on April 21, 1995; (iv)
the Company's Proxy Statement for the Special Meeting of Stockholders to be held
on September 15, 1995; (v) the description of the Company's Common Stock
contained in the Company's Registration Statement on Form 8-A filed with the
Commission on January 5, 1984; (vi) the description of the Company's share
purchase rights contained in the Company's Registration Statement on Form 8-A
filed with the Commission on August 1, 1989 and amended on March 6, 1990; (vii)
the Company's Report on Form 10-C filed with the Commission on May 19, 1995; and
(viii) all other documents filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of this offering.
Any statement contained in a document incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus and the
Registration Statement of which it is a part to the extent that a statement
contained herein or in any other subsequently filed document which also is
incorporated herein modifies or replaces such statement. Any statement so
modified or superseded shall not be deemed, in its unmodified form, to
constitute a part of this Prospectus or such Registration Statement.
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, upon the written or oral request of any such
person, a copy of any or all of the documents which are incorporated herein by
reference (other than exhibits to such information, unless such exhibits are
specifically incorporated by reference into the information this Prospectus
incorporates). Requests should be directed to Burr-Brown Corporation, 6730 South
Tucson Boulevard, Tucson, Arizona 85706, Attention: Jill H. Rice, Corporate
Secretary.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK OF
THE COMPANY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NASDAQ NATIONAL MARKET, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
IN CONNECTION WITH THIS OFFERING, CERTAIN UNDERWRITERS AND SELLING GROUP
MEMBERS (IF ANY) OR THEIR RESPECTIVE AFFILIATES MAY ENGAGE IN PASSIVE MARKET
MAKING TRANSACTIONS IN THE COMMON STOCK ON THE NASDAQ NATIONAL MARKET IN
ACCORDANCE WITH RULE 10B-6A UNDER THE SECURITIES EXCHANGE ACT OF 1934. SEE
"UNDERWRITING."
2
<PAGE>
PROSPECTUS SUMMARY
THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION, INCLUDING "RISK FACTORS," APPEARING ELSEWHERE IN THIS PROSPECTUS.
THE COMPANY
Burr-Brown is a leader in the design, development, manufacture and sale of
high performance analog and mixed signal integrated circuits. The Company's
products are used in a variety of electronic systems for communications,
computing, industrial process control, test and instrumentation, digital audio
and imaging. The Company offers over 1,000 high performance products that
perform signal processing functions such as the conditioning, amplification and
filtering of analog signals, and mixed signal functions such as
analog-to-digital and digital-to-analog conversion. Within its targeted markets,
Burr-Brown emphasizes high performance applications where its products are
critical elements of complex systems.
The Company sells its products to a diverse base of over 30,000 customers
worldwide, with key customers including Alcatel, AT&T, Allen-Bradley, Canon,
Conner Peripherals, General Electric, Hewlett-Packard, Hughes Network Systems,
Nokia, Northern Telecom, Siemens, Sony, Teradyne and Toshiba. The Company has
maintained long-term relationships with major customers in the industrial
process control, instrumentation and imaging markets, and typically serves as
the sole supplier of proprietary products. Recently, Burr-Brown has pursued a
strategy of leveraging its strengths in analog signal processing and mixed
signal design to develop a broad line of standard products for the faster
growing communications, computing and digital audio markets. As a result, the
Company has established key new customer relationships with leading companies in
the wireless and high speed communications industry. In addition, several of the
Company's products have also achieved significant market acceptance among
certain major suppliers in the personal computer industry.
Burr-Brown maintains major manufacturing and technical facilities in Tucson,
Arizona; Atsugi, Japan; and Livingston, Scotland. In 1994, Burr-Brown
established business units in these locations to bring greater focus on their
respective served markets and accelerate new product development. Analog and
mixed signal circuit design is highly dependent on the skills and experience of
individual design engineers, and Burr-Brown believes that its team of design
engineers has developed core strengths in high performance analog and mixed
signal integrated circuits. Since the beginning of 1994, the Company has
introduced over 90 new high performance products.
The Company sells and markets its products in major markets worldwide
through approximately 75 direct sales personnel, 40 manufacturers'
representatives and 20 distributors. The Company's direct sales force focuses
primarily on large corporate customers, while the Company's distributors service
the needs of the Company's broad base of smaller customers. In particular, the
direct sales force and field application engineers are focused on new design-ins
to enhance the Company's long-term revenue stream.
Burr-Brown satisfies the majority of its wafer requirements (approximately
75% in 1994) through its own wafer fabrication facility in Tucson. The Company
is able to utilize a range of proprietary bipolar manufacturing processes to
optimize product performance, minimize manufacturing cost and increase
production flexibility. The Company also employs proprietary deposition
technology and computer-controlled laser trimming techniques to produce circuits
with the desired high precision. The Company augments its internal manufacturing
with wafer foundry and assembly services from third party subcontractors.
The Company is also a majority shareholder in two subsidiaries, Intelligent
Instrumentation Inc., which provides portable data collection systems and
software and signal conditioning accessories, and Power Convertibles
Corporation, a supplier of DC-to-DC converter products, and battery chargers for
the cellular telephone market.
3
<PAGE>
THE OFFERING
<TABLE>
<S> <C>
Common Stock offered by the Company............. 1,750,000 shares
Common Stock to be outstanding after the
offering....................................... 16,173,696 shares(1)
Use of proceeds................................. Capital expenditures for expansion of
manufacturing capacity and general
corporate purposes, including working
capital
Nasdaq National Market symbol................... BBRC
</TABLE>
SUMMARY CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, ---------------------
---------------------------------- JULY 2, JULY 1,
1992 1993 1994 1994 1995
---------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales........................................... $ 162,949 $ 168,577 $ 194,196 $ 94,962 $ 129,141
Gross profit........................................ 76,392 81,602 87,954 45,684 61,984
Operating income.................................... 6,984 7,785 10,527 7,133 16,857
Net income.......................................... $ 998 $ 2,817 $ 6,465 $ 3,701 $ 11,502
Net income per share................................ $ 0.07 $ 0.20 $ 0.45 $ 0.26 $ 0.76
Shares used in per share calculation................ 14,390 14,376 14,498 14,355 15,071
</TABLE>
<TABLE>
<CAPTION>
AS OF JULY 1, 1995
--------------------------
ACTUAL AS ADJUSTED(2)
---------- --------------
<S> <C> <C>
BALANCE SHEET DATA:
Working capital..................................................................... $ 54,539 $ 107,489
Net land, buildings and equipment................................................... 49,963 49,963
Long-term debt and capital lease obligations (less current portion)................. 1,895 1,895
Stockholders' equity................................................................ 101,548 154,498
Total assets........................................................................ 171,177 224,127
<FN>
------------------------
(1) Based on shares outstanding as of July 1, 1995 and the 1,750,000 shares to
be offered by the Company. Does not include options outstanding at July 1,
1995 to purchase 1,140,234 shares under the 1993 Stock Incentive Plan at a
weighted average exercise price of $6.31 per share. Also does not include
an additional 275,000 shares of Common Stock reserved for future option
grants under the Company's 1993 Stock Incentive Plan.
(2) Adjusted to give effect to the receipt of the net proceeds from the sale of
the 1,750,000 shares of Common Stock offered by the Company hereby at an
assumed offering price of $32.00 per share, and after deducting the
underwriting discount and estimated offering expenses. See "Use of
Proceeds" and "Capitalization."
</TABLE>
EXCEPT AS SET FORTH IN THE FINANCIAL STATEMENTS INCORPORATED BY REFERENCE
HEREIN OR OTHERWISE NOTED HEREIN, ALL INFORMATION CONTAINED IN THIS PROSPECTUS
ASSUMES NO EXERCISE OF THE UNDERWRITERS' OVER-ALLOTMENT OPTION, AND ALL SHARE
AND PER SHARE DATA HAVE BEEN ADJUSTED TO REFLECT THE THREE-FOR-TWO STOCK SPLIT
EFFECTED IN THE FORM OF A STOCK DIVIDEND ON MAY 19, 1995.
4
<PAGE>
RISK FACTORS
THE FOLLOWING RISK FACTORS SHOULD BE CONSIDERED CAREFULLY IN ADDITION TO THE
OTHER INFORMATION CONTAINED IN THIS PROSPECTUS BEFORE PURCHASING THE COMMON
STOCK OFFERED HEREBY.
POTENTIAL FLUCTUATIONS IN OPERATING RESULTS. The Company's quarterly and
annual operating results are affected by a wide variety of factors that could
materially and adversely affect net sales, gross profit and profitability. These
factors include the volume and timing of orders received, changes in the mix of
products sold, market acceptance of the Company's and its customers' products,
competitive pricing pressures, fluctuations in foreign currency exchange rates,
the Company's ability to meet increasing demand, the Company's ability to
introduce new products on a timely basis, the timing of new product
introductions by the Company or its competitors, the timing and extent of
research and development expenses, fluctuations in manufacturing yields,
semiconductor industry cycles, the Company's access to advanced process
technologies, and the timing and extent of process development costs.
Historically, average selling prices in the semiconductor industry have
decreased over the life of particular products. If the Company is unable to
introduce new products with higher average selling prices or is unable to reduce
manufacturing costs to offset decreases in the prices of its existing products,
the Company's operating results will be adversely affected. In addition, the
Company is limited in its ability to reduce costs quickly in response to any
revenue shortfalls. As a result of the foregoing or other factors, there can be
no assurance that the Company will not experience material adverse fluctuations
in future operating results on a quarterly or annual basis. Although the
Company's profits have increased on an annual basis since 1991, there can be no
assurance that the Company will be able to maintain or increase its level of
profitability in future periods. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations."
DEPENDENCE ON NEW PRODUCTS. The Company's success depends upon its ability
to develop new analog and mixed signal products for existing and new markets, to
introduce such products in a timely manner and to have such products gain market
acceptance. The development of new products is highly complex, and from time to
time the Company has experienced delays in developing and introducing new
products. Successful product development and introduction depends on a number of
factors, including proper new product definition, timely completion of design
and testing of new products, achievement of acceptable manufacturing yields, and
market acceptance of the Company's and its customers' products. Moreover,
successful product design and development is dependent on the Company's ability
to attract, retain and motivate qualified analog design engineers, of which
there is a limited number. There can be no assurance that the Company will be
able to meet these challenges or adjust to changing market conditions as quickly
and cost-effectively as necessary to compete successfully. Due to the complexity
and variety of products manufactured by the Company, the limited number of
analog circuit designers and the limited effectiveness of computer-aided design
systems in the design of analog circuits, there can be no assurance that the
Company will be able to successfully develop and introduce new products on a
timely basis. Although the Company seeks to design products that have the
potential to become broadly accepted for high volume applications, there can be
no assurance that any products introduced by the Company will achieve such
market success. The Company's failure to develop and introduce new products
successfully could materially and adversely affect its business and operating
results. The Company has targeted new markets in which it has relatively little
experience, including the market niches for wireless applications for the
communications industry, power management applications for the computing
industry, and CD-ROM and PC sound applications for the digital audio industry.
There can be no assurance that the Company's products will adequately meet the
requirements of such new markets, or that the Company's products will achieve
market acceptance.
MANUFACTURING RISKS. The fabrication of integrated circuits is a highly
complex and precise process. Minute impurities, contaminants in the
manufacturing environment, difficulties in the fabrication process, defects in
the masks used to print circuits on a wafer, manufacturing equipment failures,
wafer breakage or other factors can cause a substantial percentage of wafers to
be rejected or numerous die on each wafer to be nonfunctional. In addition,
yields are impacted by defects caused during laser trimming, which is a
difficult process to manage. Manufacturing yields are also impacted by die
handling and assembly and test procedures. A large portion of the Company's
manufacturing costs are relatively fixed and, consequently, the number of
shippable die per wafer for a given product is critical to the Company's results
of operations. To the extent the
5
<PAGE>
Company does not achieve acceptable manufacturing yields or experiences product
shipment delays, its financial condition and results of operations would be
materially and adversely affected. As is typical in the semiconductor industry,
the Company has from time to time experienced lower than expected production
yields, which have delayed product shipments and adversely affected gross
margins. As the Company continues to increase its manufacturing output and its
use of third party foundries, there can be no assurance that the Company will
not experience a decrease in manufacturing yields. Moreover, there can be no
assurance that the Company will be able to maintain acceptable manufacturing
yields in the future.
To meet anticipated future demand and to utilize a broader range of
fabrication processes, the Company intends to increase its manufacturing
capacity. Failure to do so could result in a loss of customers, which could
materially and adversely affect the Company's financial condition or results of
operations. However, given the complexity and expense of designing and
constructing a significant expansion of a semiconductor fabrication plant,
during the construction of the additions the Company's manufacturing yields
could be materially and adversely impacted. Moreover, there can be no assurance
that the Company will be able to achieve the goals of the expansion, that the
expansion will be completed in a timely manner, or that, when completed, the
Company's expanded fabrication facility will be capable of producing wafers of a
comparable manufacturing yield and quality as those currently produced by the
Company.
The Company currently manufactures the majority of its products at its
Tucson wafer fabrication facility. Given the complex nature of the Company's
products, it would be difficult for the Company to arrange for independent
manufacturing facilities to supply all such products. Any prolonged inability to
utilize the Company's manufacturing facility as a result of fire, natural
disaster or otherwise would have a material adverse effect on the Company's
financial condition and results of operations. As has occurred from time to time
in the past, during periods of decreased demand, high fixed wafer fabrication
costs can result in decreased gross margins and thereby materially and adversely
affect the Company's financial condition or results of operations. Furthermore,
the Company is dependent on a number of foundries for certain of its
manufacturing processes not available internally. The failure of any of these
foundries to perform these processes on a timely basis could result in
manufacturing delays, which could materially and adversely affect the Company's
results of operations.
RISKS OF INTERNATIONAL SALES. Sales to Japan, Europe and other
international markets in 1992, 1993, 1994 and the six-month period ended July 1,
1995 accounted for approximately 61%, 64%, 62% and 66%, respectively, of the
Company's net sales. The Company expects that international sales will continue
to represent a majority of net sales. The Company desires to continue to expand
its operations outside of the United States and to enter additional
international markets, which will require significant management attention and
financial resources and subject the Company further to the risks of operating
internationally. These risks include unexpected changes in regulatory
requirements, delays resulting from difficulty in obtaining export licenses for
certain technology, tariffs and other barriers and restrictions, and the burdens
of complying with a variety of foreign laws. The Company is also subject to
general geopolitical risks in connection with its international operations, such
as political and economic instability and changes in diplomatic and trade
relationships. The Company cannot predict whether quotas, duties, taxes or other
charges or restrictions will be imposed by the United States, Japan, Taiwan or
other countries upon the import or export of the Company's products in the
future, or what effect any such actions would have on its business, financial
condition or results of operations. In addition, because most of the Company's
international sales are denominated in foreign currencies, gains and losses on
the conversion to U.S. dollars of accounts receivable and accounts payable
arising from international operations may contribute to fluctuations in the
Company's operating results. In particular, the Company's recent operating
results have been favorably impacted by fluctuations in foreign currency
exchange rates. Although the Company typically enters into hedging transactions
when products are shipped in order to reduce exposure to currency rate
fluctuations, there can be no assurance that such hedging transactions will
reduce exposure to currency rate fluctuations or that fluctuations in currency
exchange rates in the future will not have an adverse impact on the Company's
results of operations. Furthermore, fluctuations in currency exchange rates may
negatively impact the Company's ability to compete in terms of price against
products denominated in local currencies. In addition, there can be no assurance
that regulatory, geopolitical and other factors will not adversely impact the
Company's operations in the future or require the Company to modify its current
business practices.
6
<PAGE>
COMPETITION. The semiconductor industry is intensely competitive and is
characterized by price erosion, declining gross margins, rapid technological
change, product obsolescence and heightened international competition in many
markets. The Company's competitors include Analog Devices, Inc., Linear
Technology Corp., Maxim Integrated Products Inc. and, in some segments, National
Semiconductor Corporation, Harris Corp., Motorola Inc., Texas Instruments Inc.,
Cirrus Logic Inc., Signal Processing Technologies, Sipex Corp., Unitrode Corp.,
Asahi Kasei Micro, Sony Electronics Inc., Hitachi America Ltd., Matsushita
Electric Corp. of America, Mitsubishi Corp. and Philips Semiconductors. Many of
these competitors have substantially greater financial, technical, marketing,
distribution and other resources, broader product lines and longer standing
relationships with customers than the Company. The Company's competitors also
include emerging companies attempting to sell products to specialized markets
such as those addressed by the Company. In the event of a downturn in the market
for analog circuits, companies that have broader product lines and longer
standing customer relationships may be in a stronger competitive position than
the Company. Competitors with greater financial resources or broader product
lines also may have more resources than the Company to engage in sustained price
reductions in the Company's primary markets to gain market share. As is typical
in the semiconductor industry, competitors of the Company have developed and
marketed products having similar or identical design and functionality as the
Company's products, and the Company expects that this will continue in the
future. To the extent the Company's products do not achieve performance, size or
other advantages over products offered by competitors, the Company is likely to
experience greater price competition with respect to such products.
The Company believes that its ability to compete successfully depends on a
number of factors both within and outside of its control, including price,
product quality, performance, success in developing and timing of introduction
of new products, adequate wafer fabrication capacity and sources of raw
materials, efficiency of production, timing of new product introductions by
competitors, protection of Company products by effective utilization of
intellectual property laws, and general market and economic conditions. There
can be no assurance that the Company will be able to compete successfully in the
future.
TECHNOLOGICAL CHANGE. The markets for the Company's products are
characterized by rapid technological change and frequent new product
introductions. To remain competitive, the Company must develop or obtain access
to new semiconductor design and process technologies to reduce die size,
increase die performance and functional complexity and improve manufacturing
yields. Semiconductor design and process methodologies are subject to rapid
technological change, requiring large expenditures for research and development.
If the Company is unable to develop or obtain access to advanced wafer
processing technologies as they become needed, or is unable to define, design,
develop and introduce competitive new products on a timely basis, its future
operating results will be materially and adversely affected. In addition, the
Company's ability to compete successfully depends on being able to use advanced
analog process technologies to manufacture its products. There can be no
assurance that the analog process technologies utilized by the Company will not
become obsolete.
SEMICONDUCTOR INDUSTRY. The semiconductor industry has historically been
cyclical and subject to significant economic downturns at various times, and has
been characterized from time to time by diminished product demand, accelerated
erosion of average selling prices and overcapacity. In addition, the end-markets
for systems that incorporate the Company's products are characterized by rapidly
changing technology and evolving industry standards. Although the semiconductor
industry in recent periods has experienced increased demand and production
capacity constraints, it is uncertain how long these conditions will continue.
The Company also may experience substantial period-to-period fluctuations in
future operating results due to general semiconductor industry conditions,
overall economic conditions or other factors. The Company, like other
semiconductor manufacturers with fabrication facilities, has high fixed costs
for its manufacturing facilities and believes that its operating results may be
adversely affected by an industry-wide downturn in the demand for
semiconductors. Such downturns may coincide with a recession in the U.S. economy
and slower growth in various electronics industries using semiconductors,
including market segments in which the Company is engaged at the time.
DEPENDENCE ON KEY EMPLOYEES; NEED TO HIRE AND RETAIN PERSONNEL. The
Company's future performance depends in significant part upon the continued
service of its key technical and senior management personnel. The loss of the
services of one or more of the Company's officers or other key employees could
have a material adverse effect on the Company's business, operating results and
financial condition. While many of the
7
<PAGE>
Company's current employees have many years of service with the Company, there
can be no assurance that the Company will be able to retain its existing
personnel. If the Company is unable to retain and hire additional personnel, the
Company's business and results of operations could be materially and adversely
affected. The future success of the Company is dependent, in part, on its
ability to attract, assimilate and retain additional, including certain key,
personnel. The Company will continue to need a substantial number of personnel,
including those with specialized skills, to commercialize its products and
expand all areas of its business in order to continue to grow. The Company
intends to hire a significant number of additional personnel in 1995 and beyond.
Competition for such personnel is intense, and there can be no assurance that
the Company will be able to attract, assimilate or retain additional highly
qualified personnel.
DEPENDENCE ON KEY SUPPLIERS. The Company has integrated circuit assembly
operations in Tucson and Scotland. In addition, much of the assembly demand is
met by using contract assembly companies located in the United States, Japan,
Taiwan, Malaysia, Korea and the Philippines. In the event that any of the
Company's contract assembly companies were to experience financial, operational,
production or quality assurance difficulties resulting in a reduction or
interruption in supply to the Company, the Company's operating results would be
adversely affected until alternate contract assembly companies, if any, became
available. The principal raw materials used by the Company in the manufacture of
its monolithic integrated circuits are silicon wafers, chemicals and gases used
in processing wafers, gold wire and ceramic, metal and epoxy packages that
enclose the chip and provide the external connections for the circuit. Silicon
wafers and other raw materials may be obtained from several suppliers. From time
to time, particularly during periods of increased industry-wide demand, silicon
wafers and other materials have been in short supply. A prolonged inability to
obtain silicon wafers or any other raw materials could have a material adverse
impact on the Company's business.
PATENTS AND INTELLECTUAL PROPERTY. The Company's success depends in part on
its ability to obtain patents and licenses and to preserve other intellectual
property rights covering its manufacturing processes, products and development
and testing tools. The Company seeks patent protection for those inventions and
technologies for which it believes such protection is suitable and is likely to
provide a competitive advantage to the Company. The Company currently holds 106
United States patents on semiconductor devices and methods with various
expiration dates, some as early as 1995. The Company has applications for 6
United States patents currently pending. The Company also holds 36 foreign
patents and has 34 foreign patent applications pending. The process of seeking
patent protection can be long and expensive and there can be no assurance that
its current patents or any new patents that may be issued will be of sufficient
scope or strength to provide any meaningful protection or any commercial
advantage to the Company. The Company may in the future be subject to or
initiate interference proceedings in the United States Patent and Trademark
office, which can demand significant financial and management resources.
The Company regards elements of its manufacturing process, product design
and equipment as proprietary and seeks to protect its proprietary rights through
a combination of employee and third party non-disclosure agreements, internal
procedures and patent protection. Notwithstanding the Company's attempts to
protect its proprietary rights, the Company believes that its future success
will depend primarily upon the technical expertise, creative skills and
management abilities of its officers and key employees rather than on patent and
copyright ownership. The Company also relies substantially on trade secrets and
proprietary technology to protect technology and manufacturing know-how, and
works actively to foster continuing technological innovation to maintain and
protect its competitive position. There can be no assurance that the Company's
competitors will not independently develop or patent substantially equivalent or
superior technologies.
The semiconductor industry is characterized by frequent litigation regarding
patent and other intellectual property rights. There can be no assurance that
any patent owned by the Company will not be invalidated, circumvented or
challenged, that the rights granted thereunder will provide competitive
advantages to the Company or that any of the Company's pending or future patent
applications will be issued with the scope of the claims sought by the Company,
if at all. In addition, effective copyright and trade secret protection may be
unavailable or limited in certain foreign countries. The Company is currently a
plaintiff in certain litigation regarding improper use of the Company's
proprietary information. A counter-claim has been filed against the Company in
connection with such litigation. In addition, the Company has been sued for
patent infringement by a competitor. While the claimed infringement relates to
products that account for an immaterial level of its net
8
<PAGE>
sales and the Company believes it has meritorious defenses to these claims and
the counter-claim, patent litigation is inherently uncertain and there can be no
assurance that these matters or future intellectual property litigation will not
have a material adverse impact on the Company's business.
As is typical in the semiconductor industry, the Company has from time to
time received, and may in the future receive, communications from third parties
asserting patents, maskwork rights, or copyrights on certain of the Company's
products and technologies. In the event a third party were to make a valid
intellectual property claim and a license was not available on commercially
reasonable terms, the Company's operating results could be materially and
adversely affected. Litigation, which could result in substantial cost to the
Company and diversion of its resources, may also be necessary to enforce patents
or other intellectual property rights of the Company or to defend the Company
against claimed infringement of the rights of others. The failure to obtain
necessary licenses or the occurrence of litigation relating to patent
infringement or other intellectual property matters could have a material
adverse effect on the Company's business and operating results. There can be no
assurance that the steps taken by the Company to protect its intellectual
property will be adequate to prevent misappropriation or that others will not
develop competitive technologies or products.
ENVIRONMENTAL AND OTHER GOVERNMENTAL REGULATIONS. Federal, state and local
regulations impose various controls on the storage, handling, discharge and
disposal of chemicals and gases used in the Company's manufacturing process and
on the facility leased by the Company. The Company believes that its activities
conform to present governmental regulations applicable to its operations and its
current facilities, including those related to environmental, land use, public
utility utilization and fire code matters. Increasing public attention has,
however, been focused on the environmental impact of semiconductor operations
and the risk to neighbors of chemical releases from such operations. There can
be no assurance that future governmental regulations will not impose the need
for additional capital equipment or other process requirements upon the Company
or restrict the Company's ability to expand its operations. The adoption of
future regulations or any failure by the Company to comply with applicable
existing environmental and land use regulations or to restrict the discharge of
hazardous substances could subject the Company to future liability and could
cause its manufacturing operations to be curtailed or suspended.
The Company is a named party in a toxic tort case filed in Pima County
Superior Court on January 13, 1992. The Company attempted informal negotiations
with the plaintiffs for dismissal that were ultimately unsuccessful. On
September 29, 1993, the Company then answered and denied liability for the
nuisance, trespass, negligence, strict liability, and other alleged torts. The
Company is named in three other toxic tort cases filed in U.S. District Court on
September 20, 1991, August 7, 1992, and January 9, 1995, respectively, which are
consolidations of individual lawsuits that sought damages for contaminating
ground water which was then pumped from public wells and consumed. Injuries are
alleged to have resulted from drinking the contaminated water and one suit is
asking for future medical monitoring. Third party complaints were filed by the
original defendant against five companies including Burr-Brown on September 30,
1993, March 7, 1994, and February 16, 1995. The complaints seek to have the
other five companies share in whatever damages are imposed. The original
defendant/third party claimant and the Company have filed joint motions for
dismissal of all claims against Burr-Brown without prejudice on the three cases
filed in U.S. District Court, and are awaiting approval of the court.
After undertaking extensive hydrological investigations and consultation
with independent environmental consultants, the Company believes it did not
contribute to the alleged contamination and, therefore, is of the opinion that
the disposition of the claims in the four toxic tort cases described above will
not result in any material change in the Company's financial condition, results
of operations or liquidity. However, environmental litigation is inherently
uncertain, and there can be no assurance as to the ultimate outcome of these
claims.
CONTROL BY OFFICERS, DIRECTORS AND AFFILIATED ENTITIES. Upon completion of
this offering, Thomas R. Brown,
Jr. and the Company's other directors, executive officers and entities
affiliated with such directors as a group will beneficially own approximately
37.4% and 2.8%, respectively, of the issued and outstanding shares of the
Company's Common Stock. Accordingly, such stockholders will have sufficient
voting power to control the outcome of matters (including the election of
directors and any merger, consolidation or sale of all or substantially all of
the Company's assets) submitted to the stockholders for approval and may be
deemed to have
9
<PAGE>
effective control over the affairs and management of the Company. This
controlling interest in the Company may also have the effect of making certain
transactions more difficult or impossible, absent the support of such
stockholders. Such transactions could include a proxy contest, mergers involving
the Company, tender offers and open market purchase programs involving Common
Stock that could give stockholders of the Company the opportunity to realize a
premium over the then prevailing market price for their shares of Common Stock.
STOCK PRICE VOLATILITY. The trading price of the Company's Common Stock may
be subject to wide fluctuations in response to quarter-to-quarter variations in
operating results, announcements of technological innovations or new products by
the Company or its competitors, general conditions in the semiconductor and
electronic components industries, changes in earnings estimates or
recommendations by analysts, or other events or factors. In future quarters, if
the Company's financial performance falls below the performance predicted by
securities analysts, the Company's stock price could decline. In addition, the
public stock markets have experienced extreme price and trading volume
volatility in recent months. This volatility has significantly affected the
market prices of securities of many high technology companies for reasons
frequently unrelated to the operating performance of the specific companies.
These broad market fluctuations may adversely affect the market price of the
Company's Common Stock.
EFFECT OF ANTI-TAKEOVER PROVISIONS. The Company has taken a number of
actions that could have the effect of discouraging a takeover attempt that might
be beneficial to stockholders who wish to receive a premium for their shares
from a potential bidder. The Company has adopted a stockholder rights plan that
would cause substantial dilution to a person who attempts to acquire the Company
on terms not approved by the Company's Board of Directors. The stockholder
rights plan may therefore have the effect of delaying or preventing any change
in control and deterring any prospective acquisition of the Company. In
addition, the Company's Certificate of Incorporation grants the Board of
Directors the authority to issue up to 2,000,000 shares of Preferred Stock and
to determine the price, rights, preferences and privileges of those shares
without any further vote or action by the Company's stockholders. The rights of
the holders of Common Stock will be subject to, and may be adversely affected
by, the rights of the holders of any shares of Preferred Stock that may be
issued in the future. While the Company has no present intention to issue shares
of Preferred Stock, such issuance, while providing desirable flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult or less attractive for a third party to
acquire a majority of the outstanding voting stock of the Company. Such
Preferred Stock may also have other rights, including economic rights senior to
the Common Stock, and, as a result, the issuance thereof could have a material
adverse effect on the market value of the Common Stock. The Company's
Certificate of Incorporation also contains a "fair price" provision that
requires the approval of the holders of 90% of the Company's outstanding voting
shares as a condition to a merger or other "business combination" involving the
Company and any "related person," unless the transaction is either approved by
at least a two-thirds vote of disinterested directors or certain minimum price
and procedural requirements are met. Furthermore, the Company is subject to the
anti-takeover provisions of Section 203 of the Delaware General Corporation Law,
which prohibits the Company from engaging in a "business combination" with an
"interested stockholder" for a period of three years after the date of the
transaction in which the person first becomes an "interested stockholder,"
unless the business combination is approved in a prescribed manner. The
application of Section 203 also could have the effect of delaying or preventing
a change of control of the Company.
10
<PAGE>
THE COMPANY
Burr-Brown Corporation ("Burr-Brown" or the "Company") was incorporated in
Arizona in May 1956 as "Burr-Brown Research Corporation" and was reincorporated
in Delaware in January 1983 as "Burr-Brown Corporation." The Company's executive
offices are located at 6730 South Tucson Boulevard, Tucson, Arizona 85706, and
the Company's telephone number is (520) 746-1111.
The name "Burr-Brown" and the logo appearing on the cover page of this
Prospectus are registered trademarks of the Company in the United States.
"Intelligent Instrumentation Inc." and "Power Convertibles Corporation" are
registered trademarks of such corporations. Trademarks of corporations other
than the Company are also referred to in this Prospectus.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the 1,750,000 shares of
Common Stock offered by the Company hereby at an assumed public offering price
of $32.00 per share are estimated to be $52,950,000 ($60,930,000 if the
Underwriters' over-allotment option is exercised in full).
The Company intends to use the net proceeds for capital expenditures for the
expansion of manufacturing capacity and general corporate purposes, including
working capital. The Company anticipates that its capital expenditures in 1995
and 1996 will aggregate approximately $80 million. Proceeds may also be used to
acquire companies, products or technologies that complement the Company's
business should such opportunities arise. No specific acquisitions are being
planned or negotiated as of the date of this Prospectus. Pending such uses, the
net proceeds will be temporarily invested in short-term obligations such as
certificates of deposit issued by banks, government obligations and money market
securities.
PRICE RANGE OF COMMON STOCK
The Company's Common Stock is traded on the Nasdaq National Market under the
symbol BBRC. The following table sets forth for the periods indicated the high
and low closing sale prices of the Common Stock, as adjusted to reflect the
three-for-two stock split effected on May 19, 1995.
<TABLE>
<CAPTION>
HIGH LOW
--------- ---------
<S> <C> <C>
1993
1st Quarter........................................................................ $ 5.50 $ 3.83
2nd Quarter........................................................................ 5.25 4.33
3rd Quarter........................................................................ 6.50 4.42
4th Quarter........................................................................ 4.67 3.67
1994
1st Quarter........................................................................ 4.92 3.83
2nd Quarter........................................................................ 6.58 4.17
3rd Quarter........................................................................ 7.50 5.17
4th Quarter........................................................................ 10.33 6.58
1995
1st Quarter........................................................................ 12.08 6.67
2nd Quarter........................................................................ 27.50 11.00
3rd Quarter (through August 16, 1995).............................................. 37.50 24.75
</TABLE>
On August 16, 1995, the last reported sale price for the Common Stock on the
Nasdaq National Market was $32.00 per share. As of July 1, 1995, there were
approximately 3,640 holders of record of the Common Stock.
11
<PAGE>
DIVIDEND POLICY
The Company has never declared or paid cash dividends on its Common Stock.
The Company currently intends to retain all cash for use in the operation and
expansion of its business and does not anticipate paying any cash dividends on
the Common Stock in the foreseeable future.
CAPITALIZATION
The following table sets forth on an unaudited basis the consolidated
capitalization of the Company as of July 1, 1995, and as adjusted to give effect
to the issuance and sale by the Company of the 1,750,000 shares of Common Stock
offered hereby assuming a public offering price of $32.00 per share, and the
application of the estimated net proceeds therefrom. The financial data in the
following table should be read in conjunction with the Company's unaudited
consolidated condensed quarterly financial statements (and notes thereto) as of
July 1, 1995, incorporated elsewhere herein by reference.
<TABLE>
<CAPTION>
AS OF JULY 1, 1995
-----------------------------------
ACTUAL AS ADJUSTED
---------------- -----------------
(IN THOUSANDS)
<S> <C> <C>
Long-term debt, less current portion........................................ $ 1,895 $ 1,895
Stockholders' equity (1)(2):
Preferred Stock, $.01 par value 2,000,000 shares authorized, none issued
and outstanding.......................................................... - -
Common Stock, $.01 par value 20,000,000 shares authorized, 14,423,696
shares issued and outstanding, 16,173,696 shares issued and outstanding
as adjusted.............................................................. 147 165
Additional paid-in capital................................................ 27,099 80,031
Retained earnings......................................................... 70,340 70,340
Accumulated translation adjustment........................................ 5,543 5,543
Treasury stock............................................................ (1,581) (1,581)
-------- --------
Total stockholders' equity.............................................. 101,548 154,498
-------- --------
Total capitalization.................................................. $ 103,443 $ 156,393
-------- --------
-------- --------
<FN>
------------------------
(1) Based on shares outstanding as of July 1, 1995 and the 1,750,000 shares to
be offered by the Company. Does not include options outstanding at July 1,
1995 to purchase 1,140,234 shares under the 1993 Stock Incentive Plan at a
weighted average exercise price of $6.31 per share. Also does not include
an additional 275,000 shares of Common Stock reserved for future option
grants under the Company's 1993 Stock Incentive Plan.
(2) Does not give effect to the proposed amendment to the Company's Restated
Certificate of Incorporation to increase the authorized shares of Common
Stock from 20,000,000 to 40,000,000.
</TABLE>
12
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The selected consolidated financial data presented below as of December 31,
1993 and 1994 and for each of the years in the three year period ended December
31, 1994 have been derived from the Company's consolidated financial statements
which have been audited by Ernst & Young LLP, independent auditors, which
financial statements are incorporated by reference herein. The selected
consolidated balance sheet data as of December 31, 1992 have been derived from
audited consolidated financial statements of the Company which are not
incorporated by reference herein. The selected consolidated financial data
presented below as of July 1, 1995, and for the six month periods ended July 2,
1994 and July 1, 1995 have been derived from unaudited consolidated financial
statements of the Company which financial statements are also incorporated by
reference herein. In the opinion of the Company's management, such unaudited
consolidated financial data include all adjustments, consisting of only normal
recurring adjustments, necessary to fairly state the information set forth
therein. The following consolidated financial data should be read in conjunction
with the consolidated financial statements, related notes and other financial
information incorporated by reference herein. See "Incorporation of Certain
Documents by Reference."
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, ------------------------
--------------------------------------- JULY 2, JULY 1,
1992 1993 1994 1994 1995
------------- ----------- ----------- ----------- -----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales................................. $ 162,949 $ 168,577 $ 194,196 $ 94,962 $ 129,141
Cost of sales............................. 86,557 86,975 106,242 49,278 67,157
------------- ----------- ----------- ----------- -----------
Gross profit............................ 76,392 81,602 87,954 45,684 61,984
Operating expenses:
Product development..................... 18,136 19,752 21,851 10,512 12,749
Selling, general and administrative..... 51,272 54,065 55,576 28,039 32,378
------------- ----------- ----------- ----------- -----------
Total operating expenses.............. 69,408 73,817 77,427 38,551 45,127
------------- ----------- ----------- ----------- -----------
Operating income.......................... 6,984 7,785 10,527 7,133 16,857
Other expense:
Interest expense........................ (3,825) (2,338) (1,725) (1,043) (598)
Other, net.............................. (1,439) (900) (511) (646) (502)
------------- ----------- ----------- ----------- -----------
Other expense........................... (5,264) (3,238) (2,236) (1,689) (1,100)
------------- ----------- ----------- ----------- -----------
Income before taxes....................... 1,720 4,547 8,291 5,444 15,757
Provision for income taxes................ 722 1,730 1,826 1,743 4,255
------------- ----------- ----------- ----------- -----------
Net income................................ $ 998 $ 2,817 $ 6,465 $ 3,701 $ 11,502
------------- ----------- ----------- ----------- -----------
------------- ----------- ----------- ----------- -----------
Net income per share (1).................. $ 0.07 $ 0.20 $ 0.45 $ 0.26 $ 0.76
------------- ----------- ----------- ----------- -----------
------------- ----------- ----------- ----------- -----------
Shares used in per share
calculation (1).......................... 14,390 14,376 14,498 14,355 15,071
------------- ----------- ----------- ----------- -----------
------------- ----------- ----------- ----------- -----------
<CAPTION>
AS OF DECEMBER 31, AS OF
--------------------------------------- JULY 1,
1992 1993 1994 1995
------------- ----------- ----------- -----------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital........................... $ 47,705 $ 49,456 $ 45,623 $ 54,539
Net land, buildings and equipment......... 45,665 42,427 45,896 49,963
Long-term debt and capital lease
obligations (less current portion)....... 11,718 8,802 1,839 1,895
Stockholders' equity...................... 77,443 79,551 87,622 101,548
Total assets.............................. $ 136,407 $ 142,062 $ 143,008 $ 171,177
<FN>
------------------------
(1) Adjusted to reflect the three-for-two stock split effected on May 19, 1995.
</TABLE>
13
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Reference is made to Management's Discussion and Analysis of Financial
Condition and Results of Operations in the Company's Annual Report on Form 10-K
incorporated herein by reference for a discussion covering a comparison of the
Company's 1992, 1993 and 1994 results of operations. Reference is made to
Management's Discussion and Analysis of Financial Condition and Results of
Operations in the Company's Quarterly Report on Form 10-Q for the quarter ended
July 1, 1995 incorporated herein by reference for a discussion covering a
comparison of the Company's results of operations for the six-month periods
ended July 2, 1994 and July 1, 1995. See "Incorporation of Certain Documents by
Reference."
QUARTERLY RESULTS OF OPERATIONS
The following tables present unaudited quarterly financial information for
the four quarters of 1994 and the first two quarters of 1995. All share and per
share data have been adjusted to reflect the three-for-two stock split effected
on May 19, 1995. In the opinion of the Company's management, this unaudited
information has been prepared on the same basis as the audited financial
statements incorporated herein by reference and includes all adjustments
(consisting of only normal recurring adjustments) necessary to present fairly
the information set forth therein. The operating results for any quarter are not
necessarily indicative of results for any future period. The Company anticipates
that results will fluctuate on a quarterly basis depending on a number of
factors. See "Risk Factors--Potential Fluctuations in Operating Results."
<TABLE>
<CAPTION>
QUARTER ENDED
----------------------------------------------------------------
APRIL 2, JULY 2, OCT. 1, DEC. 31, APRIL 1, JULY 1,
1994 1994 1994 1994 1995 1995
--------- --------- --------- --------- --------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales..................................... $ 47,355 $ 47,607 $ 49,217 $ 50,017 $ 59,547 $ 69,594
Cost of sales................................. 24,481 24,797 28,040 28,924 31,361 35,796
--------- --------- --------- --------- --------- ---------
Gross profit................................ 22,874 22,810 21,177 21,093 28,186 33,798
Operating expenses:
Product development......................... 4,929 5,583 5,386 5,953 5,828 6,921
Selling, general and administrative......... 14,581 13,458 13,464 14,073 15,567 16,811
--------- --------- --------- --------- --------- ---------
Total operating expenses.................. 19,510 19,041 18,850 20,026 21,395 23,732
--------- --------- --------- --------- --------- ---------
Operating income.............................. 3,364 3,769 2,327 1,067 6,791 10,066
Other expense................................. (809) (880) (264) (283) (411) (689)
--------- --------- --------- --------- --------- ---------
Income before taxes........................... 2,555 2,889 2,063 784 6,380 9,377
Provision for income taxes.................... 818 925 359 (276) 1,723 2,532
--------- --------- --------- --------- --------- ---------
Net income.................................... $ 1,737 $ 1,964 $ 1,704 $ 1,060 $ 4,657 $ 6,845
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
Net income per share.......................... $ 0.12 $ 0.14 $ 0.12 $ 0.07 $ 0.31 $ 0.45
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
Shares used in per share calculation.......... 14,303 14,436 14,522 14,775 14,805 15,212
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
</TABLE>
14
<PAGE>
The following table sets forth for the period indicated certain financial
data as a percentage of net sales and year-over-year sales growth:
<TABLE>
<CAPTION>
QUARTER ENDED
----------------------------------------------------------------
APRIL 2, JULY 2, OCT. 1, DEC. 31, APRIL 1, JULY 1,
1994 1994 1994 1994 1995 1995
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net sales........................................... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Gross margin........................................ 48.3 47.9 43.0 42.2 47.3 48.6
Operating expenses:
Product development............................... 10.4 11.7 10.9 11.9 9.8 9.9
Selling, general and administrative............... 30.8 28.3 27.4 28.1 26.1 24.2
Total operating expenses........................ 41.2 40.0 38.3 40.0 35.9 34.1
Operating income.................................... 7.1 7.9 4.7 2.1 11.4 14.5
Net income.......................................... 3.7% 4.1% 3.5% 2.1% 7.8% 9.8%
Year-over-year sales growth......................... 12.0% 12.1% 14.6% 22.4% 25.7% 46.2%
</TABLE>
NET SALES. Net sales increased over the past six quarters from $47.4
million in the first quarter of 1994 to $69.6 million in the second quarter of
1995. This increase, which primarily occurred in the first two quarters of 1995,
reflects continued sales of the Company's products into the test and
instrumentation market and the industrial and process control market, and
increased sales into the higher growth communications, computing and digital
audio markets. In addition, sales of the Company's products in Japan and Europe
increased as a percentage of total sales over these periods. The increase in the
Company's net sales also reflects the performance of the overall semiconductor
industry, a favorable pricing environment for the Company's products, and the
favorable impact of changes in foreign currency exchange rates, particularly for
the Japanese Yen and the German Mark. Although unit volumes generally increased
throughout the four quarters of 1994, average selling prices declined over the
period, primarily due to changes in product mix, contributing to the relatively
slow sequential growth in 1994. Sales growth accelerated in the first half of
1995 due to accelerated unit volumes and modestly increased average selling
prices.
GROSS PROFIT. The Company's gross margins decreased from 48.3% in the first
quarter of 1994 to 42.2% in the fourth quarter of 1994. Gross margins
subsequently increased to 47.3% and 48.6% in the first and second quarters of
1995, respectively. The decreased gross margins in the second half of 1994
reflect, in part, the Company's efforts to manage its inventory levels while
continuing to increase its net sales. These inventory management efforts reduced
assembly and test manufacture cycle times, which caused an overall reduction in
work in process and finished goods inventories. The combined effect of these
inventory management practices allowed the Company to increase net sales over
the remainder of 1994 while decreasing manufacturing volumes during this period.
As a result, the Company's fixed manufacturing costs were allocated against a
relatively smaller amount of manufactured goods in the third and fourth quarters
of 1994, resulting in lower gross margins during those periods. The Company's
gross margins have returned to the levels of the first half of 1994 as
manufacturing volumes have increased to meet increasing net sales.
PRODUCT DEVELOPMENT. Product development expenses increased from $4.9
million to $6.9 million over the past six quarters while fluctuating between
approximately 10% and 12% of net sales over the period. The Company's long-term
strategy is to increase this spending level, both in absolute dollars and as a
percentage of net sales. During the first half of 1995, the Company established
a separate technology development department focused on process development in
order to assist in this critical area.
15
<PAGE>
SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expense remained relatively constant between $13.5 million and $14.6 million in
1994, while increasing to $15.6 million and $16.8 million in the first and
second quarters of 1995, respectively. As a percentage of net sales, these
expense items have generally decreased from 30.8% in the first quarter of 1994
to 24.2% in the second quarter of 1995, largely reflecting the increase in net
sales. Part of the percentage decrease in the first half of 1995 reflects a
consolidation of marketing resources in Europe and an overall increase in the
percentage of sales made through independent distributors rather than direct
sales.
NET INCOME. Net income has ranged between 2.1% and 9.8% of net sales over
the past six quarters, generally reflecting the combined effect of the
above-described variables. The tax rates over this period have been favorably
impacted by the expected utilization of net operating loss and tax credit
carryforwards as well as a greater increase in United States profits than the
increase in profits from foreign operations, which have higher income tax rates
than the United States.
16
<PAGE>
BUSINESS
Burr-Brown is a leader in the design, development, manufacture and sale of
high performance analog and mixed signal integrated circuits. The Company's
products are used in a variety of electronic systems for communications,
computing, industrial process control, test and instrumentation, digital audio
and imaging. The Company offers over 1,000 high performance products that
perform signal processing functions such as the conditioning, amplification and
filtering of analog signals, and mixed signal functions such as
analog-to-digital and digital-to-analog conversion. Within its targeted markets,
Burr-Brown emphasizes high performance applications where its products are
critical elements of complex systems.
INDUSTRY BACKGROUND
Integrated circuits may be divided into three categories--analog, digital
and mixed signal. Digital circuits, which include memory devices and
microprocessors, use many repetitive circuit elements that can each represent
the two values ("1" and "0") required by the binary number system that serves as
a basis for most computation. Analog circuits, on the other hand, are capable of
representing infinite numbers of values, with an output signal based on a
continuously varying input signal. These input signals typically represent "real
world" phenomena such as temperature, pressure, position, frequency, sound and
speed. Mixed signal circuits are circuits that employ both analog and digital
signal processing techniques. Analog and mixed signal circuits are used in most
electronic systems, with major markets for such circuits including computing,
telecommunications and data communications, test and measurement, medical
instrumentation, industrial process control, manufacturing automation, digital
audio and automotive electronics. Typical analog circuits include signal
amplifiers, instrumentation amplifiers, current transmitters, regulators, analog
multipliers and isolation amplifiers. Typical mixed signal circuits include
analog-to-digital and digital-to-analog converters. Recently, the rapid growth
of the high speed and wireless communications, multimedia and portable
computing, and digital audio markets have created important new growth
opportunities for high performance analog and mixed signal products. Industry
sources estimate that analog and mixed signal circuits will account for 14% of
the projected $125 billion market for semiconductors in 1995.
The market for, and design and production of, analog circuits differ from
the market for, and design and production of, digital circuits in several
important ways. In general, the market for analog circuits is more diverse than
for digital circuits, with each application requiring different operating
specifications for resolution, processing linearity, speed, power and amplitude
capability. As a result, analog circuits generally have relatively smaller
volume requirements per device. The markets for analog circuits are generally
fragmented, and competition within those markets tends to depend less upon price
and more upon performance, functionality, quality and reliability. Analog
circuits designed for specific applications are often characterized by longer
life cycles and more stable pricing compared to typical digital circuits.
Computer-aided design and engineering tools, which have proliferated and
enhanced the design effort for digital integrated circuits, are less effective
for analog devices. Accordingly, analog circuit design has traditionally been
highly dependent on the skills and experience of individual design engineers.
Also, in contrast to digital circuits, the performance of analog circuits is
more dependent on circuit design, circuit layout and the matching of circuit
elements than on advanced capabilities in submicron manufacturing processes.
Consequently, the production of high performance analog circuits typically
requires less capital investment than the production of highly integrated
digital circuits. Because analog circuits are found in most electronic systems,
the growth in the use of digital systems across a broad range of applications
has in turn fueled a growth in the demand for analog integrated circuits.
STRATEGY
Burr-Brown is currently well positioned as a leading supplier of precision
high performance analog and mixed signal integrated circuits to the
communications, computing, industrial process control, test and instrumentation,
digital audio and imaging markets. The Company maintains a strong presence in
the industrial process control, and test and instrumentation markets, where it
has long established relationships with a broad, diverse customer base.
Burr-Brown also serves the communications, computing, digital audio and imaging
markets by offering high performance standard products that can be used as
precision building blocks across many applications. The Company believes it can
further strengthen its presence in these markets by providing
17
<PAGE>
application specific standard products (ASSPs) that are developed to address the
unique requirements of fast growing emerging applications. Beginning in 1994,
Burr-Brown's new management team developed a plan to enhance the Company's
growth and profitability by employing the following strategies:
STRENGTHEN LEADERSHIP IN THE COMPANY'S TRADITIONAL MARKETS. Burr-Brown is a
leading supplier of precision high performance analog and mixed signal
integrated circuits to a variety of markets, including the industrial process
control, and test and instrumentation markets, and offers over 1,000 high
performance products to a diverse base of over 30,000 customers worldwide. In
these markets, the Company has maintained long-term relationships with major
customers and typically serves as the sole supplier of proprietary products. The
Company intends to enhance its leadership position and expand its market share
in the design, manufacture and marketing of these products by offering optimized
standard products along with targeted high volume application-specific standard
products. The Company believes that its established reputation and strong
customer relationships will continue to facilitate entry into key new
applications which include smart sensors and AC motor control.
TARGET HIGH GROWTH MARKETS. The Company is expanding its presence in
certain high growth segments of the communications, computing, digital audio and
imaging markets in which it can capitalize on its expertise in designing and
manufacturing precision analog and mixed signal integrated circuits. The Company
seeks to increase its presence in these markets by leveraging its existing core
competencies and understanding of customer needs into key market niches such as
wireless basestations and High bit rate Digital Subscriber Line ("HDSL") for the
communications market; and power management, CD-ROM, PC-sound and imaging
applications for the computing market. Within its targeted markets, Burr-Brown
emphasizes high performance applications where its products are critical
elements of complex systems.
ACCELERATE NEW PRODUCT DEVELOPMENT. To capitalize on the growth
opportunities in its targeted markets, the Company seeks to expand its product
offerings while reducing the time required to bring new products to market.
Since the beginning of 1994, the Company has introduced over 90 high performance
products, including a family of low power, high resolution analog-to-digital
converters for a broad range of applications; a group of high speed operational
amplifiers delivering low noise and low distortion necessary for applications in
video signal processing and high speed communications; a portfolio of high
precision instrumentation amplifiers that offer leading edge performance for
applications in process control, and test and measurement; and several PCM
digital-to-analog converters well-suited for multimedia, CD-ROMs, cable TV
set-top boxes, video phones and other high performance digital audio
applications.
LEVERAGE WORLDWIDE SALES AND DISTRIBUTION NETWORK. The Company sells its
products in major markets worldwide through an approximately 75 person direct
sales force, 40 manufacturers' representatives and 20 distributors. The Company
has recently reorganized its worldwide sales and distribution network by
focusing its direct sales force on large corporate customers while directing its
distributors to service the Company's broad base of smaller customers. The
Company believes this organizational realignment will increase the efficiency of
its selling efforts. In particular, the direct sales force and field application
engineers are focused on new design-ins to enhance the Company's long-term
revenue stream.
IMPROVE COST CONTROLS. The Company is implementing an organization-wide
cost reduction program to increase product margins and profitability. The
Company seeks to improve manufacturing yields, reduce cycle times and increase
direct labor productivity, thereby increasing manufacturing output and gaining
additional operating leverage from fixed manufacturing costs. The Company is
making significant investments in more advanced wafer fabrication and test
equipment to support these efforts. Additionally, the Company is migrating
labor-intensive assembly and test operations from higher cost domestic and
Japanese facilities to more cost-effective Southeast Asian locations. Expense
growth is being constrained within the sales, marketing, and general and
administrative areas to improve operating margins as sales increase. As part of
this initiative, the Company is working to improve its infrastructure by
investing in a fully integrated management information system that will tie
together sales and distribution, finance and materials management, production
planning, and shop floor control functions. The Company believes that, once
completely implemented, the system will facilitate further cost reductions and
create improved organizational efficiencies.
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<PAGE>
EMPLOY INTERNAL AND EXTERNAL MANUFACTURING. The Company believes that
employing both internal and external manufacturing capacity improves quality,
cost-effectiveness, responsiveness to customers, access to capacity, ability to
implement leading edge process technology and time to market. The Company
produces a majority of its wafers at its bipolar wafer fabrication facility in
Tucson, Arizona and augments internal manufacturing capacity with the foundry
services of third party wafer subcontractors for processes not available
internally. These third party processes include CMOS, BiCMOS and other bipolar
processes. Because the semiconductor industry is currently facing capacity
constraints in wafer manufacturing and the availability of third party foundries
has diminished significantly, the Company plans to expand significantly and
upgrade its Tucson wafer fabrication facility while simultaneously continuing to
use third party foundries for the manufacture of certain products.
There can be no assurance that the Company's strategies, even if
successfully implemented, will reduce the risks associated with the Company's
business. See "Risk Factors."
PRODUCTS AND CUSTOMERS
The Company offers over 1,000 high performance products to a diverse base of
over 30,000 customers worldwide. The Company's products are primarily
manufactured by four core component divisions, the Linear Products Division, the
Data Conversion Products Division, the Digital Audio Products Division, and the
Isolation Products Division. These operations accounted for more than 80% of the
Company's net sales in 1994. In addition to the Company's core component
business, Burr-Brown also owns a majority interest in each of two
subsidiaries--approximately 90% of Intelligent Instrumentation Inc. ("III") and
approximately 80% of Power Convertibles Corporation ("PCC").
19
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COMPONENTS
The following table illustrates certain representative Burr-Brown products,
their applications and representative customers in each of the principal markets
addressed by the Company.
<TABLE>
<CAPTION>
CUSTOMER SELECTED PRODUCTS CUSTOMER APPLICATIONS
<S> <C> <C>
COMMUNICATIONS
Alcatel Instrumentation & ISO Central Office Switches
Amplifiers
AT&T High Speed Amplifiers, A/D Various Telecommunications
Converters Applications
Hughes Network Systems High Speed Op. Amps, A/D & D/A Cellular Basestations
Converters
Nokia High Speed Operational Cellular Basestations
Amplifiers
Northern Telecom/BNR High Speed Amplifiers, A/D Cellular Basestations
Converters
PairGain Technologies Linear Interface Circuits HDSL
INDUSTRIAL PROCESS CONTROL
ABB Amplifiers, A/D & D/A Industrial Control
Converters
Allen Bradley Amplifiers, A/D & D/A Program Logic Controls
Converters
Elsag Bailey Isolation Amplifiers Process Control Systems
General Electric Amplifiers, A/D & D/A Robotic/Motor Control
Converters
Siemens Amplifiers, A/D & D/A Motor Control/Industrial Control
Converters
TEST AND INSTRUMENTATION
Advantest Amplifiers, A/D & D/A Semiconductor Test Equipment
Converters
Hewlett Packard Amplifiers, A/D & D/A Test Equipment
Converters
National Instruments Amplifiers, A/D & D/A Data Acquisition Systems
Converters
Teradyne Amplifiers, A/D & D/A Semiconductor Test Equipment
Converters
DIGITAL AUDIO
Alpine PCM Converters Automotive Stereos
Pioneer PCM Converters CD Players
Sony PCM Converters Portable Stereos
Yamaha PCM Converters Electronic Keyboards
COMPUTING
Conner Peripherals Regulators Hard Disk Drives
Fujitsu Regulators Hard Disk Drives
Hewlett Packard Regulators Disk Drives
NEC PCM Converters CD-ROM Drives
IMAGING
Canon Amplifiers Copiers
Siemens Amplifiers & Analog Circuit CAT Scanners
Functions
Toshiba Analog Circuit Function & A/D CAT Scanners
Converters
</TABLE>
LINEAR PRODUCTS DIVISION
The Company's analog circuits include operational amplifiers, power
amplifiers, instrumentation amplifiers, programmable gain amplifiers, isolation
amplifiers, current transmitters and other analog signal processing components.
Analog signal processing integrated circuits are used to process and transmit
analog information prior to their conversion to digital signals. These
components are used in communications equipment, automatic test equipment,
analytical instruments, medical instruments and systems, military equipment,
industrial controls, personal computing devices and computer peripherals.
20
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OPERATIONAL AMPLIFIERS. Operational amplifiers are used to detect and
amplify weak (low level) analog signals and are included in many measurement
and control systems. The operational amplifier is the fundamental building
block in analog systems design. In addition to amplification, it can perform
mathematical functions such as integration and differentiation. The
Company's high performance operational amplifiers are generally capable of
amplifying typical analog signals in the micro-volt range up to 100,000
times and provide ultra-low drift, low bias current, low noise, high
bandwidth and fast settling time. Certain models provide high voltage and
high current operation for special applications. These high performance
amplifiers are required to treat signals generated in numerous applications,
including scramblers for satellite communications systems, robotic vision
systems and magnetic resonance and computer-aided tomography (CAT) body
scanning systems.
OTHER AMPLIFIERS. The Company manufactures a number of other
amplifiers, including instrumentation amplifiers and programmable gain
amplifiers. These products perform a variety of functions related to the
amplification of analog signals. Among other uses, these components permit
the measurement of weak signals in the presence of unwanted "noise" and
protect sensitive instruments from the effects of transient high-magnitude,
potentially damaging voltages caused by sources such as lightning or
switching of high voltage equipment. These amplifiers are used in many
diverse applications ranging from temperature measurement in industrial
processes to the protection of sensitive medical instruments, and to isolate
electrical power line disturbances and faults.
OTHER SIGNAL PROCESSING AND TRANSMITTER COMPONENTS. The Company
manufactures a variety of other analog signal processing components
including mathematical function circuits, current transmitters and
voltage-to-frequency converters. Mathematical function circuits are used
when information sought can be effectively derived only through its
mathematical relationship to analog signals. Current transmitters send
analog signal information from a process sensor to measurement or control
equipment in the form of a current on the same wires that produce the power
to the transmitter and sensor. Voltage-to-frequency converters convert
process signals to a frequency, making the signal immune to electrical noise
and permitting more efficient storage and processing of the information.
DATA CONVERSION PRODUCTS DIVISION
The Company's Data Conversion Products Division focuses on the design,
manufacturing and marketing of integrated circuit devices used to convert analog
signals to digital form ("A/D converters") or to convert digital signals to
analog form ("D/A converters"). This conversion is necessary in virtually all
applications in which digital computers or processors measure and control the
analog signals from a physical, "real world" process.
GENERAL PURPOSE CONVERSION PRODUCTS. The majority of the Company's
mixed signal components revenue is derived from moderate speed, high
resolution and high accuracy converters. These general purpose converters
are used primarily in manufacturing process control instrumentation,
electronic test instrumentation, automatic test systems and communications
systems. For example, in a robot controller, the position of the robot arm
must be precisely measured and manipulated. Analog signals from the robot's
position sensors are converted by an A/D converter for computer processing
and, in turn, a D/A converter converts the digital control signal from the
computer to analog form to drive the actuators and servo motors to position
the robot arm accurately.
HIGH SPEED CONVERSION PRODUCTS. In the early 1980's, the Company began
developing high speed, high resolution A/D and D/A converters at speeds
substantially greater than general purpose products. These products utilize
a unique combination of technologies and design expertise to achieve
state-of-the-art performance. High speed converters are used in a variety of
applications such as image processing, digital oscilloscopes, ultrasound,
radar and sonar, as well as the front end of advanced systems using digital
signal processing (DSP) technology. The Company believes that due to the
unique combination of technologies involved, the high speed, high resolution
data converter products have limited competition.
DIGITAL AUDIO PRODUCTS DIVISION (BURR-BROWN JAPAN)
The Company's Digital Audio Products Division, which is operated by the
Company's wholly-owned Japanese subsidiary, focuses on the design, manufacturing
and marketing of high precision, single chip digital-
21
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to-analog converters and analog-to-digital for the digital audio market. The
Company believes that Burr-Brown was the first company to introduce such a
product into this marketplace and is currently one of the largest merchant
market suppliers of such devices worldwide. This product, a pulse-code-modulated
("PCM") conversion device, plays an essential role in digital audio systems,
such as compact disc ("CD") players, that use laser technology to achieve
improved audio reproduction performance. The Company's component converts the
digital signals for each stereo channel into audio. Several generations of
products of this type have been developed and introduced for use in digital
audio systems. Involvement in the CD market also helped the Company's early
entry into the digital audio tape ("DAT") and multimedia markets. The Company
believes that the technology developed for its digital audio D/A converter
products enables the Company to develop products for other markets. Burr-Brown's
PCM converters have now been designed into musical instruments, computer games,
automobile sound systems, CD-ROMs for multimedia applications and set top box
tuners for cable and satellite TV.
ISOLATION PRODUCTS DIVISION (BURR-BROWN LTD.)
The Company's Isolation Products Division, which is operated by Burr-Brown's
wholly-owned Scottish subsidiary, focuses on the design, development,
manufacturing, and marketing of isolation amplifiers, isolated analog digital
converters, bus transceivers, and DC-to-DC converters. These products provide
galvanic isolation of input and output signals and thereby achieve reduced
circuit noise interference and prevent harm to people or equipment due to high
voltage transients or current leakage. The product line utilizes optical,
tranformer, and capacitive techniques to produce linear transfer functions
between input and output. In certain products, isolated digital couplers are
used in lieu of opto-couplers in the galvanic isolation of data signals. The
isolation products are used in industrial process control, communication, and in
medical instrumentation.
INTELLIGENT INSTRUMENTATION INC. (III)
Intelligent Instrumentation Inc. designs, manufactures and markets a broad
line of data acquisition products, including plug-in boards, portable data
acquisition systems, microterminals and supporting software for IBM-compatible
PCs, as well as signal conditioning accessories for such systems. These products
are applied worldwide for a wide range of industrial and scientific applications
such as inventory control, package tracking, image pattern recognition and
electro-medical systems. A key part of the data acquisition product line is the
Visual Designer-TM- software, a graphical development environment which enables
users to design applications by connecting functional blocks, called icons, in a
flow diagram. III also offers integrated data collection systems that not only
collect data, but format and deliver that data to a customer's information
system in real time. Representative customers include Mercedes Benz, Siemens,
Nikon Koden, Novellus Systems and Xerox.
POWER CONVERTIBLES CORPORATION (PCC)
Power Convertibles Corporation focuses on the market for DC-to-DC conversion
and battery chargers. PCC is one of the leading suppliers of low power DC/DC
converters as well as products to condition and charge many types of batteries
including cellular telephones. Its products are supplied worldwide to the
computer, medical, industrial, telecommunications, data communications and
instrumentation markets. PCC also designs, manufactures and markets battery
chargers for the cellular telephone market. A significant proportion of PCC's
revenues in recent periods has been generated from a single customer in this
market. PCC has custom design capabilities and has recently established
independent marketing organization in an effort to increase its customer base.
Representative customers include Ericsson, AT&T, Medtronic, Allen-Bradley, SCI
and Johnson Controls.
The Company has from time-to-time received indications of interest with
respect to both III and PCC, and has considered, and may in the future consider,
the sale of its interest in these subsidiaries.
22
<PAGE>
DESCRIPTION OF CAPITAL STOCK
Upon the closing of this offering, the authorized capital stock of the
Company will consist of 40,000,000 shares of Common Stock, $.01 par value, and
2,000,000 shares of Preferred Stock, $.01 par value.
COMMON STOCK
As of July 1, 1995, there were 14,423,696 shares of Common Stock
outstanding, and there were approximately 3,640 holders of record of the Common
Stock. The holders of Common Stock are entitled to one vote for each share held
of record on all matters submitted to a vote of stockholders. Subject to
preferences that may be applicable to any outstanding shares of Preferred Stock,
the holders of Common Stock are entitled to receive ratably such dividends, if
any, as may be declared from time to time by the Board of Directors out of funds
legally available for the payment of dividends. See "Dividend Policy." In the
event of a liquidation, dissolution or winding up of the Company, the holders of
Common Stock are entitled to share ratably in all assets remaining after payment
of liabilities and liquidation preferences of any outstanding shares of
Preferred Stock. Holders of Common Stock have no preemptive rights or rights to
convert their Common Stock into any other securities. There are no redemption or
sinking fund provisions applicable to the Common Stock. All outstanding shares
of Common Stock are fully paid and non-assessable, and the shares of Common
Stock to be issued upon completion of this offering will be fully paid and
non-assessable.
PREFERRED STOCK
Pursuant to the Company's Restated Certificate of Incorporation, the Board
of Directors has the authority, without further action by the stockholders, to
issue up to 2,000,000 shares of Preferred Stock in one or more series and to fix
the designations, powers, preferences, privileges, and relative participating,
optional or special rights and the qualifications, limitations or restrictions
thereof, including dividend rights, conversion rights, voting rights, terms of
redemption and liquidation preferences, any or all of which may be greater than
the rights of the Common Stock. The Board of Directors, without stockholder
approval, will be able to issue Preferred Stock with voting, conversion or other
rights that could adversely affect the voting power and other rights of the
holders of Common Stock. Preferred Stock could thus be issued quickly with terms
calculated to delay or prevent a change in control of the Company or make
removal of management more difficult. See "Risk Factors-- Effect of
Anti-takeover Provisions." Additionally, the issuance of Preferred Stock may
have the effect of decreasing the market price of the Common Stock. At present,
the Company has no plans to issue any of the Preferred Stock.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Company's Common Stock is Bank One,
Arizona, N.A.
23
<PAGE>
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement, the
Underwriters named below have severally agreed to purchase from the Company the
following respective number of shares of Common Stock.
<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITER SHARES
---------------------------------------------------------------- -----------
<S> <C>
Hambrecht & Quist LLC...........................................
Cowen & Company.................................................
-----------
Total....................................................... 1,750,000
-----------
-----------
</TABLE>
The Underwriting Agreement provides that the obligations of the Underwriters
are subject to certain conditions precedent, including the absence of any
material adverse change in the Company's business and the receipt of certain
certificates, opinions and letters from the Company and its counsel and
independent auditors. The nature of the Underwriters' obligation is such that
they are committed to purchase all shares of Common Stock offered hereby if any
such shares are purchased.
The Underwriters propose to offer the shares of Common Stock directly to the
public at the offering price set forth on the cover of this Prospectus and to
certain dealers at such price less a concession not in excess of $ per share.
The Underwriters may allow and such dealers may reallow a concession not in
excess of $
per share to certain other dealers. After the public offering of the shares, the
offering price and other selling terms may be changed by the Underwriters.
The Company has granted to the Underwriters an option, exercisable no later
than 30 days after the date of this Prospectus, to purchase up to 262,500
additional shares of Common Stock at the public offering price, less the
underwriting discount, set forth on the cover page of this Prospectus. To the
extent that the Underwriters exercise this option, each of the Underwriters will
have a firm commitment to purchase approximately the same percentage thereof
which the number of shares of Common Stock to be purchased by it shown in the
above table bears to the total number of shares of Common Stock offered hereby.
The Company will be obligated, pursuant to the option, to sell such shares to
the Underwriters to the extent the option is exercised. The Underwriters may
exercise such option only to cover over-allotments made in connection with the
sale of shares of Common Stock offered hereby.
The offering of the shares is made for delivery when, as and if accepted by
the Underwriters and subject to prior sale and to withdrawal, cancellation or
modification of the offering without notice. The Underwriters reserve the right
to reject an order for the purchase of shares in whole or in part.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act, and to contribute
to payments the Underwriters may be required to make in respect thereof.
Certain stockholders of the Company, including executive officers, other
executives and directors, who own in the aggregate approximately 5,715,000
shares of Common Stock have agreed that they will not, without the prior written
consent of Hambrecht & Quist LLC acting alone or each of the representatives
acting jointly, offer, sell, or otherwise dispose of any shares of Common Stock,
options to acquire shares of Common Stock or securities exchangeable for or
convertible into shares of Common Stock owned by them for a period of 90 days
following the effective date of the Registration Statement. The Company has
agreed that it will not, without the prior written consent of Hambrecht & Quist
LLC acting alone or each of the representatives acting jointly, offer, sell, or
otherwise dispose of any shares of Common Stock, options or warrants to acquire
shares of Common Stock or securities exchangeable for or convertible into shares
of Common Stock during the 90 day period following the effective date of the
Registration Statement, except that the Company may grant additional options
under its stock plans and issue securities under, or pursuant to the exercise of
options granted under, its stock plans.
24
<PAGE>
In general, the rules of the Commission will prohibit the Underwriters from
making a market in the Company's Common Stock during the "cooling off" period
immediately preceding the commencement of sales in the offering. The Commission
has, however, adopted exemptions from these rules that permit passive market
making under certain conditions. These rules permit an underwriter to continue
to make a market subject to the conditions, among others, that its bid not
exceed the highest bid by a market maker not connected with the offering and
that its net purchases on any one trading day not exceed prescribed limits.
Pursuant to these exemptions, the Underwriters, selling group members (if any)
or their respective affiliates intend to engage in passive market making in the
Company's Common Stock during the cooling off period.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for the
Company by Brobeck, Phleger & Harrison, Palo Alto, California and certain legal
matters in connection with the Offering will be passed upon for the Underwriters
by Morrison & Foerster, Palo Alto, California.
EXPERTS
The consolidated financial statements of Burr-Brown Corporation incorporated
by reference in Burr-Brown Corporation's Annual Report (Form 10-K) for the year
ended December 31, 1994, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and incorporated
herein by reference. Such consolidated financial statements are incorporated
herein by reference in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
25
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY TO ANY PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL OR TO ANY PERSON TO WHOM IT IS UNLAWFUL. NEITHER
THE DELIVERY OF THIS PROSPECTUS NOR ANY OFFER OR SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN
THE AFFAIRS OF THE COMPANY OR THAT THE INFORMATION CONTAINED HEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.
--------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Available Information.......................... 2
Incorporation of Certain Documents by
Reference..................................... 2
Prospectus Summary............................. 3
Risk Factors................................... 5
The Company.................................... 11
Use of Proceeds................................ 11
Price Range of Common Stock.................... 11
Dividend Policy................................ 12
Capitalization................................. 12
Selected Consolidated Financial Data........... 13
Management's Discussion and Analysis of
Financial Condition and Results of
Operations.................................... 14
Business....................................... 17
Description of Capital Stock................... 23
Underwriting................................... 24
Legal Matters.................................. 25
Experts........................................ 25
</TABLE>
1,750,000 SHARES
[LOGO]
COMMON STOCK
--------------
PROSPECTUS
--------------
HAMBRECHT & QUIST
COWEN & COMPANY
SEPTEMBER , 1995
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth an itemized statement of all costs and
expenses (all of which will be paid by the Registrant) in connection with the
issuance and distribution of the securities being registered pursuant to this
Registration Statement, other than underwriting discounts and commissions, if
any. All of the amounts shown are estimates except the Securities and Exchange
Commission registration fee, the NASD filing fee and the Nasdaq National Market
listing fee:
<TABLE>
<S> <C>
SEC Registration Fee.............................................. $ 22,414
NASD Fee.......................................................... 7,000
The Nasdaq National Market Listing Fee............................ 17,500
Blue Sky Fees and Expenses........................................ 12,000
Legal Fees and Expenses........................................... 75,000
Accounting Fees and Expenses...................................... 25,000
Printing Expenses................................................. 50,000
Transfer Agent and Registrar's Fees and Expenses.................. 5,000
Miscellaneous..................................................... 36,086
---------
Total......................................................... $ 250,000
---------
---------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law authorizes a court to
award or a corporation's Board of Directors to grant indemnification to
directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the Securities Act of 1933,
as amended (the "Act"). Article VII Section 6 of the Registrant's Bylaws
provides for mandatory indemnification of its directors and officers and
permissible indemnification of employees and other agents to the maximum extent
permitted by the Delaware General Corporation Law. The Registrant's Certificate
of Incorporation provides that, pursuant to Delaware law, its directors shall
not be liable for monetary damages for breach of the directors' fiduciary duty
as a director to the Company and its stockholder. This provision in the
Certificate of Incorporation does not eliminate the directors' fiduciary duty,
and in appropriate circumstances equitable remedies such as injunctive or other
forms of non-monetary relief will remain available under Delaware law. In
addition, each director will continue to be subject to liability for breach of
the director's duty of loyalty to the Company for acts or omissions not in good
faith or involving intentional misconduct, for knowing violations of law, for
actions leading to improper personal benefit to the director, and for payment of
dividends or approval of stock repurchases or redemptions that are unlawful
under Delaware law. The provision also does not affect a director's
responsibilities under any other law, such as the federal securities laws or
state or federal environmental laws. The Registrant has entered into
indemnification agreements with its officers and directors which are intended to
provide the Registrant's officers and directors with further indemnification to
the maximum extent permitted by the Delaware General Corporation Law. In certain
instances, the indemnification agreements may result in an expansion of the
substantive protection available to such individuals under the Certificate of
Incorporation and Bylaws. Reference is also made to Section 7 of the
Underwriting Agreement contained in Exhibit 1.1 hereto, indemnifying officers
and directors of the Registrant against certain liabilities.
II-1
<PAGE>
ITEM 16. EXHIBITS.
<TABLE>
<S> <C>
1.1 Form of Underwriting Agreement.
4.1(1) Rights Agreement.
5.1 Opinion of Brobeck, Phleger & Harrison.
23.1 Consent of Ernst & Young LLP, independent auditors (see page II-5).
23.2 Consent of Brobeck, Phleger & Harrison (included in Exhibit 5.1).
24.1 Power of Attorney (see page II-3).
<FN>
------------------------
(1) Incorporated by reference to Exhibit 4.2 filed with the Registrant's Form
10-K for the period ended December 31, 1989 and to Exhibit 1 filed with the
Registrant's Form 8 Amendment No. 1 to Form 8-K on March 6, 1990.
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the Registration Statement
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.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions of the Registrant's Certificate of
Incorporation and Bylaws, Delaware Corporation Law, the Underwriting Agreement,
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 Securities 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 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
Securities Act and will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act, each
post-effective amendment that contains a form of prospectus shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, 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 the City of Tucson, State of Arizona, on this 17th day of August,
1995.
BURR-BROWN CORPORATION
By ________/s/_SYRUS P. MADAVI________
Syrus P. Madavi
PRESIDENT AND CHIEF EXECUTIVE
OFFICER
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
herein constitutes and appoints jointly and severally Syrus P. Madavi and John
L. Carter, and each of them, as his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
to this Registration Statement (including post-effective amendments), and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, or any of them, or their or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
------------------------------------------------------ -------------------------------------- -----------------
<C> <S> <C>
/s/THOMAS R. BROWN, JR.
Thomas R. Brown, Jr. Chairman of the Board and Director August 17, 1995
President, Chief Executive Officer and
/s/SYRUS P. MADAVI Director (Principal Executive August 17, 1995
Syrus P. Madavi Officer)
Executive Vice President and Chief
/s/JOHN L. CARTER Financial Officer (Principal August 17, 1995
John L. Carter Financial and Accounting Officer)
/s/THOMAS J. TROUP Vice Chairman of the Board and
Thomas J. Troup Director August 17, 1995
/s/FRANCIS J. AGUILAR
Francis J. Aguilar Director August 17, 1995
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
------------------------------------------------------ -------------------------------------- -----------------
<C> <S> <C>
/s/JOHN S. ANDEREGG, JR.
John S. Anderegg, Jr. Director August 17, 1995
/s/MARCELO A. GUMUCIO
Marcelo A. Gumucio Director August 17, 1995
/s/BOB J. JENKINS
Bob J. Jenkins Director August 17, 1995
/s/JAMES A. RIGGS
James A. Riggs Director August 17, 1995
</TABLE>
II-4
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITOR
We consent to the reference to our firm under the captions "Experts" and
"Selected Consolidated Financial Data" in the Registration Statement on Form S-3
and related Prospectus of Burr-Brown Corporation for the registration of shares
of its common stock and to the incorporation by reference therein of our reports
dated January 23, 1995, with respect to the consolidated financial statements of
Burr-Brown Corporation incorporated by reference in its Annual Report (Form
10-K) for the year ended December 31, 1994 and the related financial statement
schedule included therein, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
August 15, 1995
Tucson, Arizona
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------------- ---------------------------------------------------------------------------------------
<S> <C> <C>
1.1 Form of Underwriting Agreement.........................................................
4.1(1) Rights Agreement.......................................................................
5.1 Opinion of Brobeck, Phleger & Harrison.................................................
23.1 Consent of Ernst & Young LLP, independent auditors (see page II-5).....................
23.2 Consent of Brobeck, Phleger & Harrison (included in Exhibit 5.1).......................
24.1 Power of Attorney (see page II-3)......................................................
<FN>
------------------------
(1) Incorporated by reference to Exhibit 4.2 filed with the Registrant's Form
10-K for the period ended December 31, 1989.
</TABLE>
<PAGE>
BURR-BROWN CORPORATION
2,012,500 SHARES*
COMMON STOCK
----------------
UNDERWRITING AGREEMENT
September , 1995
HAMBRECHT & QUIST LLC
COWEN & COMPANY
c/o Hambrecht & Quist LLC
One Bush Street
San Francisco, CA 94104
Ladies and Gentlemen:
Burr-Brown Corporation, a Delaware corporation (herein called the Company),
proposes to issue and sell 1,750,000 shares of its authorized but unissued
Common Stock, $.01 par value (herein called the Common Stock) (said 1,750,000
shares of Common Stock being herein called the Underwritten Stock). The Company
proposes to grant to the Underwriters (as hereinafter defined) an option to
purchase up to 262,500 additional shares of Common Stock (herein called the
Option Stock and with the Underwritten Stock herein collectively called the
Stock). The Common Stock is more fully described in the Registration Statement
and the Prospectus hereinafter mentioned.
The Company hereby confirms the agreements made with respect to the purchase
of the Stock by the several underwriters, for whom you are acting, named in
Schedule I hereto (herein collectively called the Underwriters, which term shall
also include any underwriter purchasing Stock pursuant to Section 3(b) hereof).
1. REGISTRATION STATEMENT. The Company has filed with the Securities and
Exchange Commission (herein called the Commission) a registration statement on
Form S-3 (No. 33- ), including the related preliminary prospectus, for the
registration under the Securities Act of 1933, as amended (herein called the
Securities Act) of the Stock. Copies of such registration statement and of each
amendment thereto, if any, including the related preliminary prospectus (meeting
the requirements of Rule 430A of the rules and regulations of the Commission)
heretofore filed by the Company with the Commission have been delivered to you.
The term Registration Statement as used in this agreement shall mean such
registration statement, including all documents incorporated by reference
therein, all exhibits and financial statements, all information omitted
therefrom in reliance upon Rule 430A and contained in the Prospectus referred to
below, in the form in which it became effective, and any registration statement
filed pursuant to Rule 462(b) of the rules and regulations of the Commission
with respect to the Stock (herein called a Rule 462(b) registration statement),
and, in the event of any amendment thereto after the effective date of such
registration statement (herein called the Effective Date), shall also mean (from
and after the effectiveness of such amendment) such registration statement as so
amended (including any Rule 462(b) registration statement). The term Prospectus
as used in this Agreement shall mean the prospectus, including the documents
incorporated by reference therein, relating to the Stock first filed with the
Commission pursuant to Rule 424(b) and Rule 430A (or if no such filing is
required, as included in the Registration Statement) and, in the event of any
supplement or amendment to such prospectus after the Effective Date, shall also
mean (from and after the filing with the Commission of such supplement or the
effectiveness of such amendment) such prospectus as so supplemented or amended.
The term Preliminary Prospectus as used in this Agreement shall mean each
preliminary prospectus, including the documents incorporated by reference
therein, included in such registration statement prior to the time it becomes
effective.
------------------------
*Includes an option to purchase from the Company up to 262,500 additional shares
to cover over- allotments.
<PAGE>
The Registration Statement has been declared effective under the Securities
Act, and no post-effective amendment to the Registration Statement has been
filed as of the date of this Agreement. The Company has caused to be delivered
to you copies of each Preliminary Prospectus and has consented to the use of
such copies for the purposes permitted by the Securities Act.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
(a)The Company hereby represents and warrants as follows:
(i)
Each of the Company and its subsidiaries identified below has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has full
corporate power and authority to own or lease its properties and conduct its
business as described in the Registration Statement and the Prospectus and
as being conducted, and is duly qualified as a foreign corporation and in
good standing in all jurisdictions in which the character of the property
owned or leased or the nature of the business transacted by it makes
qualification necessary (except where the failure to be so qualified would
not have a material adverse effect on the business, properties, financial
condition or results of operations of the Company and its subsidiaries,
taken as a whole). The Company has the following subsidiaries:
. None of the foregoing subsidiaries
accounts for more than five percent (5%) of the Company's consolidated
revenues or is otherwise material to the business, properties, financial
condition or results of operations of the Company.
(ii)
Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any
materially adverse change in the business, properties, financial condition
or results of operations of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, other than as set forth in the Registration Statement and the
Prospectus, and since such dates, except in the ordinary course of business,
neither the Company nor either of its subsidiaries has entered into any
material transaction not referred to in the Registration Statement and the
Prospectus.
(iii)
The Registration Statement and the Prospectus comply, and on the
Closing Date (as hereinafter defined) and any later date on which
Option Stock is to be purchased, the Prospectus will comply, in all material
respects, with the provisions of the Securities Act and the rules and
regulations of the Commission thereunder; on the Effective Date, the
Registration Statement did not contain any untrue statement of a material
fact and did not omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not misleading;
and, on the Effective Date the Prospectus did not and, on the Closing Date
and any later date on which Option Stock is to be purchased, will not
contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that none of the representations and warranties in this
subparagraph (iii) shall apply to statements in, or omissions from, the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information herein or otherwise furnished in writing to the
Company by or on behalf of the Underwriters for use in the Registration
Statement or the Prospectus.
(iv)
All of the outstanding shares of the Common Stock are duly and
validly authorized and issued and fully paid and non-assessable, were
issued in compliance with all applicable federal and state securities laws
and were not issued in violation of or subject to any preemptive rights or
other rights to subscribe for or to purchase securities. The Stock is duly
and validly authorized and will be, when issued and sold to the Underwriters
as provided herein, duly and validly issued, fully paid and nonassessable
and conforms to the description thereof in the Prospectus.
(v)
The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
2
<PAGE>
(vi)
The Common Stock is listed and duly admitted to trading on the Nasdaq
National Market, and prior to the Closing Date, the Stock will be
authorized for inclusion in the Nasdaq National Market upon official notice
of issuance.
(vii)
This Agreement and the transactions contemplated herein have been
duly and validly authorized by the Company, and this Agreement has
been duly and validly executed and delivered by the Company and is a valid
and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except (i) to the extent that rights to indemnity
hereunder may be limited by federal or state securities laws or the public
policy underlying such laws; (ii) as may be limited by applicable
bankruptcy, insolvency, reorganization and other laws affecting creditors'
rights; and (iii) as may be limited by general principles of equity.
(viii)
The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not (i)
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) or require consent under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company or any of its subsidiaries pursuant to the terms of
any material agreement, instrument, franchise, license or permit to which
the Company or any of its subsidiaries is a party or by which it or its
properties or assets may be bound or (ii) violate or conflict with any
provision of the Certificate of Incorporation or By-laws (or other charter
documents) of the Company or any of its subsidiaries or any judgment,
decree, or order of any court or public, governmental or regulatory agency
or body having jurisdiction over the Company, or any of its subsidiaries or
any of their respective properties or assets. No consent, approval,
authorization, order, registration, filing, qualification, license or permit
of or with any court or public, governmental or regulatory agency or body
having jurisdiction over the Company or any of its subsidiaries or any of
their respective properties or assets is required for the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby, including the issuance, sale and delivery
of the Stock to be issued, sold and delivered by the Company hereunder,
except the registration under the Securities Act of the Stock, the listing
of the Stock on the Nasdaq National Market and such consents, approvals,
authorizations, orders, registrations, filings, qualifications, licenses and
permits as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Stock by the
Underwriters or that have been obtained and disclosed in writing to the
Underwriters.
(ix)
Except as disclosed in the Prospectus, there is no litigation or
governmental proceeding to which the Company or any of its
subsidiaries is a party or to which any property of the Company or any of
its subsidiaries is subject or, to the knowledge of the Company, threatened
against the Company or any of its subsidiaries which, if determined
adversely to the Company or any of its subsidiaries, would have a material
adverse effect on the condition (financial or other), results of operations,
business, properties or prospects of the Company and its subsidiaries, taken
as a whole, or which is required to be disclosed in the Prospectus.
(x)
The Company has not and will not take, directly or indirectly, any
action designed to cause or result in, or which constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of the shares of Common Stock to facilitate the
sale of the Stock.
(xi)
The consolidated financial statements, including the notes thereto,
and supporting schedules incorporated by reference into the
Registration Statement and the Prospectus present fairly the financial
position of the Company and its subsidiaries, taken as a whole, as of the
dates indicated and the results of its operations for the periods specified.
3
<PAGE>
(xii)
Except as described in the Prospectus or as validly waived or
satisfied, no holder of securities of the Company has any rights to
the registration of securities of the Company because of the filing of the
Registration Statement or otherwise in connection with the sale of the Stock
contemplated hereby.
(xiii)
To the best of the Company's knowledge, neither the Company nor
either of its subsidiaries has violated any law, ordinance,
governmental rule or regulation (including, without limitation, federal,
state and local rules and regulations relating to environmental, safety and
labor matters) or court decree to which it may be subject, the violation of
any of which would materially adversely affect the condition (financial or
other), business prospects, net worth or results of operations of the
Company and its subsidiaries, taken as a whole.
(xiv)
The Company and its subsidiaries have good and marketable title to
all material properties and assets reflected in the financial
statements incorporated by reference in the Registration Statement or as
described in the Registration Statement, subject to no material lien,
mortgage, pledge, charge or encumbrance of any kind except those reflected
in such financial statements or as described in the Registration Statement,
or such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made by the Company or its
subsidiaries, as applicable.
(xv)
The Company has filed with the Commission and the Nasdaq Stock
Market, Inc. all documents required to be filed under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"); when so filed, each
such document complied with the Exchange Act and the applicable rules and
regulations of the Commission thereunder; and each such document did not
contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
3. PURCHASE OF THE STOCK BY THE UNDERWRITERS.
(a)On the basis of the representations and warranties and subject to the
terms and conditions herein set forth, the Company agrees to issue and
sell 1,750,000 shares of the Underwritten Stock to the several Underwriters and
each of the Underwriters agrees to purchase from the Company the respective
aggregate number of shares of Underwritten Stock set forth opposite its name in
Schedule I. The price at which such shares of Underwritten Stock shall be sold
by the Company and purchased by the several Underwriters shall be $ per
share. In making this Agreement, each Underwriter is contracting severally and
not jointly; except as provided in paragraphs (b) and (c) of this Section 3, the
agreement of each Underwriter is to purchase only the respective number of
shares of the Underwritten Stock specified in Schedule I.
(b)If for any reason either of the Underwriters shall fail or refuse
(otherwise than for a reason sufficient to justify the termination of
this Agreement under the provisions of Section 8 or 9 hereof) to purchase and
pay for the number of shares of the Stock agreed to be purchased by such
Underwriter or Underwriters, the Company shall immediately give notice thereof
to you, and the non-defaulting Underwriter shall have the right within 24 hours
after the receipt by you of such notice to purchase, or procure one or more
other Underwriters to purchase, in such proportions as may be agreed upon
between you and such purchasing Underwriter or Underwriters and upon the terms
herein set forth, all or any part of the shares of the Stock which such
defaulting Underwriter agreed to purchase. If the non-defaulting Underwriter
fails so to make such arrangements with respect to all such shares and portion,
the number of shares of the Stock which the non-defaulting Underwriter is
otherwise obligated to purchase under this Agreement shall be automatically
increased to absorb the remaining shares and portion which the defaulting
Underwriter agreed to purchase; provided, however, that the non-defaulting
Underwriter shall not be obligated to purchase the shares and portion which the
defaulting Underwriter agreed to purchase if the aggregate number of such shares
of the Stock exceeds 10% of the total number of shares of the Stock which the
other Underwriter agreed to purchase hereunder. If the total number of shares of
the Stock which the defaulting Underwriter
4
<PAGE>
agreed to purchase shall not be purchased or absorbed in accordance with the two
preceding sentences, the Company shall have the right, within 24 hours next
succeeding the 24-hour period above referred to, to make arrangements with other
underwriters or purchasers satisfactory to you for purchase of such shares and
portion on the terms herein set forth. In any such case, either you or the
Company shall have the right to postpone the Closing Date determined as provided
in Section 5 hereof for not more than seven business days after the date
originally fixed as the Closing Date pursuant to said Section 5 in order that
any necessary changes in the Registration Statement, the Prospectus or any other
documents or arrangements may be made. If neither the non-defaulting Underwriter
nor the Company shall make arrangements within the 24-hour periods stated above
for the purchase of all the shares of the Stock which the defaulting Underwriter
agreed to purchase hereunder, this Agreement shall be terminated without further
act or deed and without any liability on the part of the Company to any
non-defaulting Underwriter and without any liability on the part of any non-
defaulting Underwriter to the Company. Nothing in this paragraph (b), and no
action taken hereunder, shall relieve any defaulting Underwriter from liability
in respect of any default of such Underwriter under this Agreement.
(c)On the basis of the representations, warranties and covenants herein
contained, and subject to the terms and conditions herein set forth, the
Company grants an option to the several Underwriters to purchase, severally and
not jointly, up to 262,500 shares in the aggregate of the Option Stock from the
Company at the same price per share as the Underwriters shall pay for the
Underwritten Stock. Said option may be exercised only to cover over-allotments
in the sale of the Underwritten Stock by the Underwriters and may be exercised
in whole or in part at any time (but not more than once) on or before the
thirtieth day after the date of this Agreement upon written or telegraphic
notice by you to the Company setting forth the aggregate number of shares of the
Option Stock as to which the several Underwriters are exercising the option.
Delivery of certificates for the shares of Option Stock, and payment therefor,
shall be made as provided in Section 5 hereof. The number of shares of the
Option Stock to be purchased by each Underwriter shall be the same percentage of
the total number of shares of the Option Stock to be purchased by the several
Underwriters as such Underwriter is purchasing of the Underwritten Stock, as
adjusted by you in such manner as you deem advisable to avoid fractional shares.
4. OFFERING BY UNDERWRITERS.
(a)The terms of the public offering by the Underwriters of the Stock to be
purchased by them shall be as set forth in the Prospectus. The
Underwriters may from time to time change the public offering price after the
closing of the public offering and increase or decrease the concessions and
discounts to dealers as they may determine.
(b)The information set forth in the last paragraph on the front cover page
and under "Underwriting" in the Registration Statement, any Preliminary
Prospectus and the Prospectus relating to the Stock filed by the Company
(insofar as such information relates to the Underwriters) constitutes the only
information furnished by the Underwriters to the Company for inclusion in the
Registration Statement, any Preliminary Prospectus, and the Prospectus, and you
on behalf of the respective Underwriters represent and warrant to the Company
that the statements made therein are correct.
5. DELIVERY OF AND PAYMENT FOR THE STOCK.
(a)Delivery of certificates for the shares of the Underwritten Stock and the
Option Stock (if the option granted by Section 3(c) hereof shall have
been exercised not later than 7:00 a.m., San Francisco time, on the date two
business days preceding the Closing Date), and payment therefor (the "Closing"),
shall be made at the office of Brobeck, Phleger & Harrison, 2200 Geng Road, Palo
Alto, California 94303, at 7:00 a.m., California time, on the third business day
after the date of this Agreement, or at such time on such other day, not later
than seven full business days after such third business day, as shall be agreed
upon in writing by the Company and you. If this Agreement has been executed and
delivered after 1:00 p.m. California time on the date of this Agreement, then
the Closing
5
<PAGE>
shall take place on the fourth business day after the date of this Agreement or
such other day as shall have been agreed as aforesaid. The date and hour of such
delivery and payment (which may be postponed as provided in Section 3(b) hereof)
are herein called the Closing Date.
(b)If the option granted by Section 3(c) hereof shall be exercised after
7:00 a.m., San Francisco time, on the date two business days preceding
the Closing Date, delivery of certificates for the shares of Option Stock, and
payment therefor, shall be made at the office of Brobeck, Phleger & Harrison,
2200 Geng Road, Palo Alto, California 94303, at 7:00 a.m., San Francisco time,
on the third business day after the exercise of such option.
(c)Payment for the Stock shall be made to the Company or its order by one or
more certified or official bank check or checks in next day funds (and
the Company agrees not to deposit any such check in the bank on which drawn
until the business day following the date of its delivery to the Company). Such
payment shall be made upon delivery of certificates for the Stock to you for the
respective accounts of the several Underwriters against receipt therefor signed
by you. Certificates for the Stock to be delivered to you shall be registered in
such name or names and shall be in such denominations as you may request at
least one business day before the Closing Date, in the case of Underwritten
Stock, and at least one business day prior to the purchase thereof, in the case
of the Option Stock. Such certificates will be made available to the
Underwriters for inspection, checking and packaging at the offices of Lewco
Securities Corporation, 2 Broadway, New York, New York 10004 on the business day
prior to the Closing Date or, in the case of the Option Stock, by 3:00 p.m., New
York time, on the business day preceding the date of purchase.
It is understood that either of you, individually and not on behalf of the
other Underwriter, may (but shall not be obligated to) make payment to the
Company for shares to be purchased by the other Underwriter whose check shall
not have been received by you on the Closing Date or any later date on which
Option Stock is purchased for the account of such Underwriter. Any such payment
by either of you shall not relieve the other Underwriter from any of its
obligations hereunder.
6. FURTHER AGREEMENTS OF THE COMPANY. The Company covenants and agrees as
follows:
(a)The Company will (i) prepare and timely file with the Commission under
Rule 424(b) a Prospectus containing information previously omitted at the
time of effectiveness of the Registration Statement in reliance on Rule 430A and
(ii) not file any amendment to the Registration Statement or supplement to the
Prospectus of which you shall not previously have been advised and furnished
with a copy or to which you shall have reasonably objected in writing or which
is not in compliance with the Securities Act or the rules and regulations of the
Commission.
(b)The Company will promptly notify each Underwriter in the event of (i) the
request by the Commission for amendment of the Registration Statement or
for supplement to the Prospectus or for any additional information, (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement, (iii) the institution or notice of intended institution
of any action or proceeding for that purpose, (iv) the receipt by the Company of
any notification with respect to the suspension of the qualification of the
Stock for sale in any jurisdiction, or (v) the receipt by it of notice of the
initiation or threatening of any proceeding for such purpose. The Company will
make every reasonable effort to prevent the issuance of such a stop order and,
if such an order shall at any time be issued, to obtain the withdrawal thereof
at the earliest possible moment.
(c)The Company will (i) on or before the Closing Date, deliver to you a
signed copy of the Registration Statement as originally filed and of each
amendment thereto filed prior to the time the Registration Statement becomes
effective and, promptly upon the filing thereof, a signed copy of each
post-effective amendment, if any, to the Registration Statement (together with,
in each case, all exhibits thereto unless previously furnished to you) and will
also deliver to you, for distribution to the Underwriters, a sufficient number
of additional conformed copies of each of the foregoing (but without exhibits)
so that one copy of each may be distributed to each Underwriter, (ii) as
promptly as possible deliver to you and send to the several Underwriters, at
such office or offices as you may
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designate, as many copies of the Prospectus as you may reasonably request, and
(iii) thereafter from time to time during the period in which a prospectus is
required by law to be delivered by an Underwriter or dealer, likewise send to
the Underwriters as many additional copies of the Prospectus and as many copies
of any supplement to the Prospectus and of any amended prospectus, filed by the
Company with the Commission, as you may reasonably request for the purposes
contemplated by the Securities Act.
(d)If at any time during the period in which a prospectus is required by law
to be delivered by an Underwriter or dealer any event relating to or
affecting the Company, or of which the Company shall be advised in writing by
you, shall occur as a result of which it is necessary, in the opinion of counsel
for the Company or of counsel for the Underwriters, to supplement or amend the
Prospectus in order to make the Prospectus not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser of the Stock,
the Company will forthwith prepare and file with the Commission a supplement to
the Prospectus or an amended prospectus so that the Prospectus as so
supplemented or amended will not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time such Prospectus
is delivered to such purchaser, not misleading. If, after the public offering of
the Stock by the Underwriters and during such period, the Underwriters shall
propose to vary the terms of offering thereof by reason of changes in general
market conditions or otherwise, you will advise the Company in writing of the
proposed variation, and, if in the opinion either of counsel for the Company or
of counsel for the Underwriters such proposed variation requires that the
Prospectus be supplemented or amended, the Company will forthwith prepare and
file with the Commission a supplement to the Prospectus or an amended prospectus
setting forth such variation. The Company authorizes the Underwriters and all
dealers to whom any of the Stock may be sold by the several Underwriters to use
the Prospectus, as from time to time amended or supplemented, in connection with
the sale of the Stock in accordance with the applicable provisions of the
Securities Act and the applicable rules and regulations thereunder for such
period.
(e)Prior to the filing thereof with the Commission, the Company will submit
to you, for your information, a copy of any post-effective amendment to
the Registration Statement and any supplement to the Prospectus or any amended
prospectus proposed to be filed.
(f)The Company will cooperate, when and as requested by you, in the
qualification of the Stock for offer and sale under the securities or
blue sky laws of such jurisdictions as you may designate and, during the period
in which a prospectus is required by law to be delivered by an Underwriter or
dealer, in keeping such qualifications in good standing under said securities or
blue sky laws; provided, however, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified. The Company
will, from time to time, prepare and file such statements, reports, and other
documents as are or may be required to continue such qualifications in effect
for so long a period as you may reasonably request for distribution of the
Stock.
(g)During a period of five years commencing with the date hereof, the
Company will furnish to you, and to each Underwriter who may so request
in writing, copies of all periodic and special reports furnished to stockholders
of the Company and of all information, documents and reports filed with the
Commission.
(h)Not later than the 45th day following the end of the fiscal quarter first
occurring after the first anniversary of the Effective Date, the Company
will make generally available to its security holders an earnings statement in
accordance with Section 11(a) of the Securities Act and Rule 158 thereunder.
(i)The Company agrees to pay all costs and expenses incident to the
performance of its obligations under this Agreement, including all costs
and expenses incident to (i) the preparation, printing and filing with the
Commission and the National Association of Securities Dealers, Inc. ("NASD") of
the Registration Statement, any Preliminary Prospectus and the Prospectus, (ii)
the furnishing to the
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Underwriters of copies of any Preliminary Prospectus and of the several
documents required by paragraph (c) of this Section 6 to be so furnished, (iii)
the printing of this Agreement and related documents delivered to the
Underwriters, (iv) the preparation, printing and filing of all supplements and
amendments to the Prospectus referred to in paragraph (d) of this Section 6, (v)
the furnishing to you and the Underwriters of the reports and information
referred to in paragraph (g) of this Section 6 and (vi) the printing and
issuance of stock certificates, including the transfer agent's fees.
(j)The Company agrees to reimburse you, for the account of the several
Underwriters, for blue sky fees and related disbursements (including
counsel fees and disbursements and cost of printing memoranda for the
Underwriters) paid by or for the account of the Underwriters or their counsel in
qualifying the Stock under state securities or blue sky laws and in the review
of the offering by the NASD.
(k)The Company hereby agrees that, without the prior written consent of
Hambrecht & Quist LLC on behalf of the Underwriters, the Company will
not, for a period of 90 days following the commencement of the public offering
of the Stock by the Underwriters, directly or indirectly, (i) sell, offer,
contract to sell, make any short sale, pledge, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase or otherwise transfer or dispose of any shares of Common
Stock or any securities convertible into or exchangeable or exercisable for or
any rights to purchase or acquire Common Stock or (ii) enter into any swap or
other agreement that transfers, in whole or in part, any of the economic
consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise. The foregoing sentence
shall not apply to (A) the Stock to be sold to the Underwriters pursuant to this
Agreement, (B) shares of Common Stock issued by the Company upon the exercise of
options granted under the stock option plans of the Company (the "Option
Plans"), all as described in footnote 1 to the table under the caption
"Capitalization" in the Preliminary Prospectus, and (C) options to purchase
Common Stock granted under the Option Plans.
(l)The Company agrees to use its best efforts to cause all directors,
officers, and beneficial holders of more than 5% of the outstanding
Common Stock to agree that, without the prior written consent of Hambrecht &
Quist LLC on behalf of the Underwriters, such person or entity will not, for a
period of 90 days following the commencement of the public offering of the Stock
by the Underwriters, directly or indirectly, (i) sell, offer, contract to sell,
make any short sale, pledge, sell any option or contract to purchase, purchase
any option or contract to sell, grant any option, right or warrant to purchase
or otherwise transfer or dispose of any shares of Common Stock or any securities
convertible into or exchangeable or exercisable for or any rights to purchase or
acquire Common Stock or (ii) enter into any swap or other agreement that
transfers, in whole or in part, any of the economic consequences or ownership of
Common Stock, whether any such transaction described in clause (i) or (ii) above
is to be settled by delivery of Common Stock or such other securities, in cash
or otherwise.
(m)The Company is familiar with the Investment Company Act of 1940, as
amended, and has in the past conducted its affairs, and will in the
future conduct its affairs, in such a manner to ensure that the Company was not
and will not be an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, and the rules and regulations thereunder.
7. INDEMNIFICATION AND CONTRIBUTION.
(a)The Company agrees to indemnify and hold harmless each Underwriter and
each person (including each partner or officer thereof) who controls any
Underwriter within the meaning of Section 15 of the Securities Act from and
against any and all losses, claims, damages or liabilities, joint or several, to
which such indemnified parties or any of them may become subject under the
Securities Act, the Securities Exchange Act of 1934, as amended (herein called
the Exchange Act), or the common law or otherwise, and the Company agrees to
reimburse each such Underwriter and controlling person for any legal or other
expenses (including, except as otherwise hereinafter provided,
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reasonable fees and disbursements of counsel) incurred by the respective
indemnified parties in connection with defending against any such losses,
claims, damages or liabilities or in connection with any investigation or
inquiry of, or other proceeding which may be brought against, the respective
indemnified parties, in each case arising out of or based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (including the Prospectus as part thereof and any Rule
462(b) registration statement) or any post-effective amendment thereto
(including any Rule 462(b) registration statement), or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus or the Prospectus (as amended or as supplemented if the
Company shall have filed with the Commission any amendment thereof or supplement
thereto) or the omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that (1) the indemnity agreements of the Company contained in this paragraph (a)
shall not apply to any such losses, claims, damages, liabilities or expenses if
such statement or omission was made in reliance upon and in conformity with
information furnished as herein stated or otherwise furnished in writing to the
Company by or on behalf of any Underwriter for use in any Preliminary Prospectus
or the Registration Statement or the Prospectus or any such amendment thereof or
supplement thereto and (2) the indemnity agreement contained in this paragraph
(a) with respect to any Preliminary Prospectus shall not inure to the benefit of
any Underwriter from whom the person asserting any such losses, claims, damages,
liabilities or expenses purchased the Stock which is the subject thereof (or to
the benefit of any person controlling such Underwriter) if at or prior to the
written confirmation of the sale of such Stock a copy of the Prospectus (or the
Prospectus as amended or supplemented) was not sent or delivered to such person
(excluding the documents incorporated therein by reference) and the untrue
statement or omission of a material fact contained in such Preliminary
Prospectus was corrected in the Prospectus (or the Prospectus as amended or
supplemented) unless the failure is the result of noncompliance by the Company
with paragraph (c) of Section 6 hereof. The indemnity agreements of the Company
contained in this paragraph (a) and the representations and warranties of the
Company contained in Section 2 hereof shall remain operative and in full force
and effect regardless of any investigation made by or on behalf of any
indemnified party and shall survive the delivery of and payment for the Stock.
(b)Each Underwriter severally agrees to indemnify and hold harmless the
Company, each of its officers who signs the Registration Statement on his
own behalf or pursuant to a power of attorney, each of its directors, each other
Underwriter and each person (including each partner or officer thereof) who
controls the Company or any such other Underwriter within the meaning of Section
15 of the Securities Act, from and against any and all losses, claims, damages
or liabilities, joint or several, to which such indemnified parties or any of
them may become subject under the Securities Act, the Exchange Act, or the
common law or otherwise and to reimburse each of them for any legal or other
expenses (including, except as otherwise hereinafter provided, reasonable fees
and disbursements of counsel) incurred by the respective indemnified parties in
connection with defending against any such losses, claims, damages or
liabilities or in connection with any investigation or inquiry of, or other
proceeding which may be brought against, the respective indemnified parties, in
each case arising out of or based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(including the Prospectus as part thereof and any Rule 462(b) registration
statement) or any post-effective amendment thereto (including any Rule 462(b)
registration statement) or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading or (ii) any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus (as amended or as supplemented if
the Company shall have filed with the Commission any amendment thereof or
supplement thereto) or the omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, if such statement
or omission was made in reliance upon and in conformity with information
furnished as
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herein stated or otherwise furnished in writing to the Company by or on behalf
of such indemnifying Underwriter for use in the Registration Statement or the
Prospectus or any such amendment thereof or supplement thereto. The indemnity
agreement of each Underwriter contained in this paragraph (b) shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of any indemnified party and shall survive the delivery of and
payment for the Stock.
(c)Each party indemnified under the provision of paragraphs (a) and (b) of
this Section 7 agrees that, upon the service of a summons or other
initial legal process upon it in any action or suit instituted against it or
upon its receipt of written notification of the commencement of any
investigation or inquiry of, or proceeding against, it in respect of which
indemnity may be sought on account of any indemnity agreement contained in such
paragraphs, it will promptly give written notice (herein called the Notice) of
such service or notification to the party or parties from whom indemnification
may be sought hereunder. No indemnification provided for in such paragraphs
shall be available to any party who shall fail so to give the Notice if the
party to whom such Notice was not given was unaware of the action, suit,
investigation, inquiry or proceeding to which the Notice would have related and
was prejudiced by the failure to give the Notice, but the omission so to notify
such indemnifying party or parties of any such service or notification shall not
relieve such indemnifying party or parties from any liability which it or they
may have to the indemnified party for contribution or otherwise than on account
of such indemnity agreement. Any indemnifying party shall be entitled at its own
expense to participate in the defense of any action, suit or proceeding against,
or investigation or inquiry of, an indemnified party. Any indemnifying party
shall be entitled, if it so elects within a reasonable time after receipt of the
Notice by giving written notice (herein called the Notice of Defense) to the
indemnified party, to assume (alone or in conjunction with any other
indemnifying party or parties) the entire defense of such action, suit,
investigation, inquiry or proceeding, in which event such defense shall be
conducted, at the expense of the indemnifying party or parties, by counsel
chosen by such indemnifying party or parties and reasonably satisfactory to the
indemnified party or parties; provided, however, that (i) if the indemnified
party or parties reasonably determine that there may be a conflict between the
positions of the indemnifying party or parties and of the indemnified party or
parties in conducting the defense of such action, suit, investigation, inquiry
or proceeding or that there may be legal defenses available to such indemnified
party or parties different from or in addition to those available to the
indemnifying party or parties, then counsel for the indemnified party or parties
shall be entitled to conduct the defense to the extent reasonably determined by
such counsel to be necessary to protect the interests of the indemnified party
or parties and (ii) in any event, the indemnified party or parties shall be
entitled to have counsel chosen by such indemnified party or parties participate
in, but not conduct, the defense. If, within a reasonable time after receipt of
the Notice, an indemnifying party gives a Notice of Defense and the counsel
chosen by the indemnifying party or parties is reasonably satisfactory to the
indemnified party or parties, the indemnifying party or parties will not be
liable under paragraphs (a) through (c) of this Section 7 for any legal or other
expenses subsequently incurred by the indemnified party or parties in connection
with the defense of the action, suit, investigation, inquiry or proceeding,
except that (A) the indemnifying party or parties shall bear the legal and other
expenses incurred in connection with the conduct of the defense as referred to
in clause (i) of the proviso to the preceding sentence and (B) the indemnifying
party or parties shall bear such other expenses as it or they have authorized to
be incurred by the indemnified party or parties. If, within a reasonable time
after receipt of the Notice, no Notice of Defense has been given, the
indemnifying party or parties shall be responsible for any legal or other
expenses incurred by the indemnified party or parties in connection with the
defense of the action, suit, investigation, inquiry or proceeding.
(d)If the indemnification provided for in this Section 7 is unavailable or
insufficient to hold harmless an indemnified party under paragraph (a) or
(b) of this Section 7, then each indemnifying party, in lieu of indemnifying
such indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of the losses, claims, damages or liabilities
referred to in paragraph (a) or (b) of this Section 7 (i) in such proportion as
is appropriate to reflect the relative benefits received by each indemnifying
party from the offering of the Stock or (ii) if the allocation
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provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of each indemnifying party in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, or actions in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Underwriters shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Stock received by
the Company and the total underwriting discount received by the Underwriters, as
set forth in the table on the cover page of the Prospectus, bear to the
aggregate public offering price of the Stock. Relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by each indemnifying party and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission.
The parties agree that it would not be just and equitable if contribution
pursuant to this paragraph (d) were to be determined by pro rata allocation
(even if the Underwriters were treated as one entity for such purpose) or by any
other method of allocation which does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d). The
amount paid by an indemnified party as a result of the losses, claims, damages
or liabilities, or actions in respect thereof, referred to in the first sentence
of this paragraph (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigation,
preparing to defend or defending against any action or claim which is the
subject of this paragraph (d). Notwithstanding the provisions of this paragraph
(d), no Underwriter shall be required to contribute any amount in excess of the
underwriting discount applicable to the Stock purchased by such Underwriter. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this paragraph (d) to contribute are several in proportion to
their respective underwriting obligations and not joint.
Each party entitled to contribution agrees that upon the service of a
summons or other initial legal process upon it in any action instituted against
it in respect of which contribution may be sought, it will promptly give written
notice of such service to the party or parties from whom contribution may be
sought, but the omission so to notify such party or parties of any such service
shall not relieve the party from whom contribution may be sought from any
obligation it may have hereunder or otherwise (except as specifically provided
in paragraph (c) of this Section 7).
(e)No indemnifying party will, without the prior written consent of each
indemnified party, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action, suit or proceeding in
respect of which indemnification may be sought hereunder (whether or not such
indemnified party or any person who controls such indemnified party within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act is
a party to such claim, action, suit or proceeding) unless such settlement,
compromise or consent includes an unconditional release of such indemnified
party and each such controlling person from all liability arising out of such
claim, action, suit or proceeding.
8. TERMINATION. This Agreement may be terminated by you at any time prior
to the Closing Date by giving written notice to the Company if after the date of
this Agreement trading in the Common Stock shall have been suspended, or if
there shall have occurred (i) the engagement in hostilities or an escalation of
major hostilities by the United States or the declaration of war or a national
emergency by the United States on or after the date hereof, (ii) any outbreak of
hostilities or other national or international calamity or crisis or change in
economic or political conditions if the effect of such outbreak, calamity,
crisis or change in economic or political conditions in the financial markets of
the United States would, in the Underwriters' reasonable judgment, make the
offering or delivery of the Stock impracticable, (iii) suspension of trading in
securities generally or a material adverse decline in value of securities
generally on the New York Stock Exchange, the American Stock Exchange, The
Nasdaq Stock Market, or limitations on prices (other than limitations on hours
or
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numbers of days of trading) for securities on either such exchange or system,
(iv) the enactment, publication, decree or other promulgation of any federal or
state statute, regulation, rule or order of, or commencement of any proceeding
or investigation by, any court, legislative body, agency or other governmental
authority which in the Underwriters' reasonable opinion materially and adversely
affects or will materially or adversely affect the business or operations of the
Company, (v) declaration of a banking moratorium by either federal or New York
State authorities or (vi) the taking of any action by any federal, state or
local government or agency in respect of its monetary or fiscal affairs which in
the Underwriters' reasonable opinion has a material adverse effect on the
securities markets in the United States. If this Agreement shall be terminated
pursuant to this Section 8, there shall be no liability of the Company to the
Underwriters and no liability of the Underwriters to the Company; provided,
however, that in the event of any such termination the Company agrees to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company under this Agreement,
including all costs and expenses referred to in paragraphs (i) and (j) of
Section 6 hereof.
9. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the several
Underwriters to purchase and pay for the Stock shall be subject to the
performance by the Company of all its obligations to be performed hereunder at
or prior to the Closing Date or any later date on which Option Stock is to be
purchased, as the case may be, and to the following further conditions:
(a) The Registration Statement shall have become effective; and no stop
order suspending the effectiveness thereof shall have been issued and
no proceedings therefor shall be pending or threatened by the Commission.
(b) The legality and sufficiency of the sale of the Stock hereunder and
the validity and form of the certificates representing the Stock, all
corporate proceedings and other legal matters incident to the foregoing, and
the form of the Registration Statement and of the Prospectus (except as to
the financial statements contained therein), shall have been approved at or
prior to the Closing Date by Morrison & Foerster, counsel for the
Underwriters.
(c) You shall have received from Brobeck, Phleger & Harrison, counsel for
the Company, an opinion, addressed to the Underwriters and dated the
Closing Date, covering the matters set forth in Annex A hereto, and if
Option Stock is purchased at any date after the Closing Date, additional
opinions from each such counsel, addressed to the Underwriters and dated
such later date, confirming that the statements expressed as of the Closing
Date in such opinions remain valid as of such later date.
(d) You shall be satisfied that (i) as of the Effective Date, the
statements made in the Registration Statement and the Prospectus were
true and correct and neither the Registration Statement nor the Prospectus
omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein, respectively, not
misleading, (ii) since the Effective Date, no event has occurred which
should have been set forth in a supplement or amendment to the Prospectus
which has not been set forth in such a supplement or amendment, (iii) since
the respective dates as of which information is given in the Registration
Statement in the form in which it originally became effective and the
Prospectus contained therein, there has not been any material adverse change
or any development involving a prospective material adverse change in or
affecting the business, properties, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, whether or
not arising from transactions in the ordinary course of business, and, since
such dates, except in the ordinary course of business, neither the Company
nor any of its subsidiaries has entered into any material transaction not
referred to in the Registration Statement in the form in which it originally
became effective and the Prospectus contained therein, (iv) neither the
Company nor any of its subsidiaries has any material contingent obligations
which are not disclosed in the Registration Statement and the Prospectus,
(v) there are not any pending or known threatened legal proceedings to which
the Company or any of its subsidiaries is a party or of which property of
the Company or any of its
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subsidiaries is the subject which are material and which are not disclosed
in the Registration Statement and the Prospectus, (vi) there are not any
franchises, contracts, leases or other documents which are required to be
filed as exhibits to the Registration Statement which have not been filed or
incorporated by reference therein as required, (vii) the representations and
warranties of the Company herein are true and correct in all material
respects as of the Closing Date or any later date on which Option Stock is
to be purchased, as the case may be, and (viii) there has not been any
material change in the market for securities in general or in political,
economic or financial conditions from those reasonably foreseeable as to
render it impracticable in your reasonable judgment to make a public
offering of the Stock, or a material adverse change in market levels for
securities in general (or those of companies in particular) or financial or
economic conditions which render it inadvisable to proceed.
(e) You shall have received on the Closing Date and on any later date on
which Option Stock is purchased a certificate, dated the Closing Date
or such later date, as the case may be, and signed by the President and the
Chief Financial Officer of the Company, stating that the respective signers
of said certificate have carefully examined the Registration Statement in
the form in which it originally became effective and the Prospectus
contained therein and any supplements or amendments thereto, and that the
statements included in clauses (i) through (vii) of paragraph (d) of this
Section 9 are true and correct.
(f) You shall have received from Ernst & Young LLP, a letter or letters,
addressed to the Underwriters and dated the Closing Date and any
later date on which Option Stock is purchased, confirming that they are
independent public accountants with respect to the Company within the
meaning of the Securities Act and the applicable published rules and
regulations thereunder and based upon the procedures described in their
letter delivered to you concurrently with the execution of this Agreement
(herein called the Original Letter), but carried out to a date not more than
three business days prior to the Closing Date or such later date on which
Option Stock is purchased (i) confirming, to the extent true, that the
statements and conclusions set forth in the Original Letter are accurate as
of the Closing Date or such later date, as the case may be, and (ii) setting
forth any revisions and additions to the statements and conclusions set
forth in the Original Letter which are necessary to reflect any changes in
the facts described in the Original Letter since the date of the Original
Letter or to reflect the availability of more recent financial statements,
data or information. The letters shall not disclose any change, or any
development involving a prospective change, in or affecting the business or
properties of the Company or any of its subsidiaries which, in your sole
judgment, makes it impractical or inadvisable to proceed with the public
offering of the Stock or the purchase of the Option Stock as contemplated by
the Prospectus.
(g) You shall have been furnished evidence in usual written or
telegraphic form from the appropriate authorities of the several
jurisdictions, or other evidence satisfactory to you, of the qualification
referred to in paragraph (f) of Section 6 hereof.
(h) Prior to the Closing Date, the Stock shall have been duly authorized
for listing by the Nasdaq National Market upon official notice of
issuance.
(i) On or prior to the Closing Date, you shall have received from all
directors, officers and beneficial holders of more than 5% of the
outstanding Common Stock agreements, in form reasonably satisfactory to
Hambrecht & Quist LLC stating that without the prior written consent of
Hambrecht & Quist LLC on behalf of the Underwriters, such person or entity
will not, for a period of 90 days following the commencement of the public
offering of the Stock by the Underwriters, directly or indirectly, (i) sell,
offer, contract to sell, make any short sale, pledge, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of any
shares of Common Stock or any securities convertible into or exchangeable or
exercisable for or any rights to purchase or acquire Common Stock or (ii)
enter into any swap or other agreement that transfers, in whole or in part,
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any of the economic consequences or ownership of Common Stock, whether any
such transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Stock or such other securities, in cash or otherwise.
(j) On or prior to the Closing Date, you shall have received from the
Company's transfer agent a certificate, dated as of a recent date, as
to the outstanding shares of the Company's Common Stock.
All the agreements, opinions, certificates and letters mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if Morrison & Foerster, counsel for the Underwriters,
shall be satisfied that they comply in form and scope.
In case any of the conditions specified in this Section 9 shall not be
fulfilled, this Agreement may be terminated by you by giving notice to the
Company. Any such termination shall be without liability of the Company to the
Underwriters and without liability of the Underwriters to the Company; provided,
however, that (i) in the event of such termination, the Company agrees to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company under this Agreement,
including all costs and expenses referred to in paragraphs (i) and (j) of
Section 6 hereof, and (ii) if this Agreement is terminated by you because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein, to fulfill any of the conditions herein, or to comply with any
provision hereof other than by reason of a default by any of the Underwriters,
the Company will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the transactions
contemplated hereby.
10. CONDITIONS OF THE OBLIGATION OF THE COMPANY. The obligation of the
Company to deliver the Stock shall be subject to the conditions that (a) the
Registration Statement shall have become effective and (b) no stop order
suspending the effectiveness thereof shall be in effect and no proceedings
therefor shall be pending or threatened by the Commission.
In case either of the conditions specified in this Section 10 shall not be
fulfilled, this Agreement may be terminated by the Company by giving notice to
you. Any such termination shall be without liability of the Company to the
Underwriters and without liability of the Underwriters to the Company; provided,
however, that in the event of any such termination the Company agrees to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company under this Agreement,
including all costs and expenses referred to in paragraphs (i) and (j) of
Section 6 hereof.
11. REIMBURSEMENT OF CERTAIN EXPENSES. In addition to its other
obligations under Section 7 of this Agreement, the Company hereby agrees to
reimburse on a quarterly basis the Underwriters for all reasonable legal and
other expenses incurred in connection with investigating or defending any claim,
action, investigation, inquiry or other proceeding arising out of or based upon
any statement or omission, or any alleged statement or omission, described in
paragraph (a) of Section 7 of this Agreement, notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the obligations
under this Section 11 and the possibility that such payments might later be held
to be improper; provided, however, that (i) to the extent any such payment is
ultimately held to be improper, the persons receiving such payments shall
promptly refund them and (ii) such persons shall provide to the Company, upon
request, reasonable assurances of their ability to effect any refund, when and
if due.
12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure
to the benefit of the Company and the several Underwriters and, with respect to
the provisions of Section 7 hereof, the several parties (in addition to the
Company and the several Underwriters) indemnified under the provisions of said
Section 7, and their respective personal representatives, successors and
assigns. Nothing in this Agreement is intended or shall be construed to give to
any other person, firm or
14
<PAGE>
corporation any legal or equitable remedy or claim under or in respect of this
Agreement or any provision herein contained. The term "successors and assigns"
as herein used shall not include any purchaser, as such purchaser, of any of the
Stock from any of the several Underwriters.
13. NOTICES. Except as otherwise provided herein, all communications
hereunder shall be in writing or by telegraph and, if to the Underwriters, shall
be mailed, telegraphed or delivered to Hambrecht & Quist LLC, One Bush Street,
San Francisco, California 94104; and if to the Company, shall be mailed,
telegraphed or delivered to it at its office, 6730 South Tucson Boulevard,
Tucson, Arizona 85706, Attention: President. All notices given by telegraph
shall be promptly confirmed by letter.
14. MISCELLANEOUS. The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of
the Company or their respective directors or officers, and (c) delivery and
payment for the Stock under this Agreement; provided, however, that if this
Agreement is terminated prior to the Closing Date, the provisions of paragraphs
(k) and (l) of Section 6 hereof shall be of no further force or effect.
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.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of California.
Please sign and return to the Company the enclosed duplicates of this
letter, whereupon this letter will become a binding agreement between the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
BURR-BROWN CORPORATION
By
--------------------------------------
Syrus P. Madavi, President and
Chief Executive Officer
The foregoing Agreement is hereby confirmed
and accepted as of the date first above written.
HAMBRECHT & QUIST LLC
COWEN & COMPANY
By Hambrecht & Quist LLC
By
--------------------------------------
Managing Director
Acting on behalf of the Underwriters,
including themselves, named in Schedule I hereto.
15
<PAGE>
ANNEX A
MATTERS TO BE COVERED IN THE OPINION OF
BROBECK, PHLEGER & HARRISON,
COUNSEL FOR THE COMPANY
(i)
Each of the Company and its subsidiaries has been duly incorporated and
is validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, is duly qualified as a foreign
corporation and in good standing in each state of the United States of America
in which its ownership or leasing of property requires such qualification
(except where the failure to be so qualified would not have a material adverse
effect on the business, properties, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole), and has full corporate
power and authority to own or lease its properties and conduct its business as
described in the Registration Statement; all the issued and outstanding capital
stock of each of the subsidiaries of the Company has been duly authorized and
validly issued and is fully paid and nonassessable and is owned by the Company
free and clear of all liens, encumbrances and security interests; and to the
best of such counsel's knowledge, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to convert
any obligations into shares of capital stock or ownership interests in such
subsidiaries are outstanding;
(ii)
the authorized capital stock of the Company consists of 2,000,000 shares
of Preferred Stock, $.01 par value, of which there are no outstanding
shares and 20,000,000 shares of Common Stock, $.01 par value, of which there are
outstanding 16,173,696 shares (including the Underwritten Stock plus the number
of shares of Option Stock issued on the date hereof; proper corporate
proceedings have been taken validly to authorize such authorized capital stock;
all of the outstanding shares of such capital stock (including the Underwritten
Stock and the shares of Option Stock issued on the Closing Date, if any) have
been duly and validly issued and are fully paid and nonassessable; any Option
Stock purchased after the Closing Date, when issued and delivered to and paid
for by the Underwriters as provided in the Underwriting Agreement, will have
been duly and validly issued and will be fully paid and nonassessable; and no
preemptive rights of, or rights of first refusal in favor of, stockholders exist
with respect to the Stock, or the issue and sale thereof, pursuant to the
Certificate of Incorporation or Bylaws of the Company and, to the knowledge of
such counsel, there are no contractual preemptive rights that have not been
waived, rights of first refusal or rights of co-sale which exist with respect to
the issue and sale of the Stock;
(iii)
the Registration Statement has become effective under the Securities Act
and, to the best of such counsel's knowledge, no stop order suspending
the effectiveness of the Registration Statement or suspending or preventing the
use of the Prospectus is in effect and no proceedings for that purpose have been
instituted or are pending or contemplated by the Commission;
(iv)
the Registration Statement and the Prospectus (except as to the financial
statements and schedules and other financial data contained therein, as
to which such counsel need express no opinion) comply as to form in all material
respects with the requirements of the Securities Act, the Exchange Act and with
the rules and regulations of the Commission thereunder;
(v)
such counsel have no reason to believe that the Registration Statement
(except as to the financial statements and schedules and other financial
and statistical data contained or incorporated by reference therein, as to which
such counsel need not express any opinion or belief) at the Effective Date
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus (except as to the financial statements
and schedules and other financial and statistical data contained or incorporated
by reference therein, as to which such counsel need not express any opinion or
belief) as of its date or at the Closing Date (or any later date on which Option
Stock is purchased), contained or contains any untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading;
(vi)
the information required to be set forth in the Registration Statement in
answer to Items 9 and 10 (insofar as it relates to such counsel) of Form
S-3 is to the best of such counsel's knowledge
<PAGE>
accurately and adequately set forth therein in all material respects or no
response is required with respect to such Items, and, to the best of such
counsel's knowledge, the description of the Company's stock option plans set
forth or incorporated by reference in the Prospectus accurately and fairly
presents the information required to be shown with respect to said plans and
options to the extent required by the Securities Act and the rules and
regulations of the Commission thereunder;
(vii)
such counsel do not know of any franchises, contracts, leases, documents
or legal proceedings, pending or threatened, which in the opinion of such
counsel are of a character required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to or incorporated by
reference in the Registration Statement, which are not described and filed or
incorporated by reference as required;
(viii)
the Underwriting Agreement has been duly authorized, executed and
delivered by the Company;
(ix)
the issue and sale by the Company of the shares of Stock as contemplated
by the Underwriting Agreement will not conflict with, or result in a
breach of, the Certificate of Incorporation or Bylaws of the Company or any of
its subsidiaries or any agreement or instrument known to such counsel to which
the Company or any of its subsidiaries is a party or any applicable law or
regulation or so far as is known to such counsel, any order, writ, injunction or
decree, of any jurisdiction, court or governmental instrumentality;
(x)
all holders of securities of the Company having rights to the
registration of shares of Common Stock, or other securities, because of
the filing of the Registration Statement by the Company have waived such rights
or such rights have expired by reason of lapse of time following notification of
the Company's intent to file the Registration Statement;
(xi)
no consent, approval, authorization or order of any court or governmental
agency or body is required for the consummation of the transactions
contemplated in the Underwriting Agreement, except such as have been obtained
under the Securities Act and such as may be required under state securities or
blue sky laws in connection with the purchase and distribution of the Stock by
the Underwriters; and
(xii)
the Stock will be duly authorized for listing by the Nasdaq National
Market upon official notice of issuance.
In addition to the matters set forth above, counsel rendering the foregoing
opinion shall also include a statement to the effect that nothing has come to
the attention of such counsel that leads them to believe that the Registration
Statement (except as to the financial statements and schedules and other
financial data contained or incorporated by reference therein, as to which such
counsel need not express any opinion or belief) at the Effective Date contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or that the Prospectus (except as to the financial statements and
schedules and other financial data contained or incorporated by reference
therein, as to which such counsel need not express any opinion or belief) as of
its date or at the Closing Date (or any later date on which Option Stock is
purchased), contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
<PAGE>
SCHEDULE I
UNDERWRITERS
<TABLE>
<CAPTION>
NUMBER OF
SHARES
TO BE
UNDERWRITERS PURCHASED
-----------
<S> <C>
Hambrecht & Quist LLC.................................................................................
Cowen & Company.......................................................................................
-----------
Total.............................................................................................
-----------
-----------
</TABLE>
<PAGE>
EXHIBIT 5.1
BROBECK, PHLEGER &
HARRISON
ATTORNEYS AT LAW
TWO EMBARCADERO PLACE
2200 GENG ROAD
PALO ALTO, CA 94303-0913
August 17, 1995
Burr-Brown Corporation
6730 S. Tucson Boulevard
Tucson, AZ 85086
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-3 filed by Burr-Brown
Corporation (the "Company") with the Securities and Exchange Commission (the
"Commission") on even date herewith, as thereafter amended or supplemented (the
"Registration Statement"), in connection with the registration under the
Securities Act of 1933, as amended, of shares of the Company's Common Stock (the
"Shares"). The Shares include an over-allotment option to the Underwriters to
purchase additional shares of the Company's Common Stock and are to be sold to
the Underwriters as described in the Registration Statement for resale to the
public. As your counsel in connection with this transaction, we have examined
the proceedings taken and are familiar with the proceedings proposed to be taken
by you in connection with the sale and issuance of the Shares.
It is our opinion that, upon conclusion of the proceedings being taken or
contemplated by us, as your counsel, to be taken prior to the issuance of the
Shares and upon completion of the proceedings being taken in order to permit
such transactions to be carried out in accordance with the securities laws of
the various states where required, the Shares, when issued and sold in the
manner described in the Registration Statement, will be legally and validly
issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to said Registration
Statement, and further consent to the use of our name wherever appearing in said
Registration Statement, including the prospectus constituting a part thereof,
and in any amendment or supplement thereto.
Very truly yours,
BROBECK, PHLEGER & HARRISON
