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As filed with the Securities and Exchange Commission on August 15, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ATMEL CORPORATION
(Exact name of Registrant as specified in its charter)
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CALIFORNIA 77-0051991
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
2325 ORCHARD PARKWAY
SAN JOSE, CALIFORNIA 95131
(408) 441-0311
(Address, including zip code, and telephone
number, including area code, of
Registrant's principal executive
offices)
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KRIS CHELLAM
VICE PRESIDENT, FINANCE AND
ADMINISTRATION AND CHIEF FINANCIAL
OFFICER
ATMEL CORPORATION
2325 ORCHARD PARKWAY
SAN JOSE, CALIFORNIA 95131
(408) 441-0311
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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COPY TO:
MARK A. BERTELSEN, ESQ.
WILSON SONSINI GOODRICH & ROSATI
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CALIFORNIA 94304-1050
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC
UNDER THIS REGISTRATION STATEMENT: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT
BECOMES EFFECTIVE.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please 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>
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PROPOSED
PROPOSED MAXIMUM
MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE AMOUNT TO BE OFFERING PRICE OFFERING REGISTRATION
REGISTERED REGISTERED (1) PER SHARE (2) PRICE (2) FEE
<S> <C> <C> <C> <C>
Common Stock, no par value...... 4,225,352 $35.50 $150,000,000 $45,455
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</TABLE>
(1) The 4,225,352 shares to be registered are issuable upon conversion of
the Company's outstanding 3.25% Convertible Subordinated Guaranteed
Step-Up Notes due 2002 (the "Notes").
(2) Computed in accordance with Rule 457 under the Securities Act of 1933
solely for purposes of calculation of the registration fee.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
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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 THE REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH
STATE.
SUBJECT TO COMPLETION, DATED AUGUST __, 1997
PROSPECTUS
4,225,352 SHARES
ATMEL CORPORATION
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COMMON STOCK
(NO PAR VALUE)
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The shares of Common Stock, no par value ("Common Stock"), of Atmel
Corporation, a California corporation ("Atmel" or the "Company"), offered hereby
(the "Shares") may be sold by or for the account of certain prospective
stockholders of the Company described herein (the "Selling Shareholders") from
time to time in transactions on the Nasdaq National Market or in the
over-the-counter market or otherwise at the prevailing market price at the time
of sale. The Shares are issuable upon conversion of the Company's outstanding
3.25% Convertible Subordinated Guaranteed Step-Up Notes due 2002 (the "Notes")
issued in an aggregate principal amount of $150,000,000 pursuant to an
Indenture, dated May 15, 1997, between the Company, Atmel S.A., a societe
anonyme organized under the laws of The Republic of France and a wholly-owned
subsidiary of the Company, and State Street Bank and Trust Company of
California, N.A., a national banking association organized under the laws of the
United States of America, (the "Indenture") in a transaction (the "Note
Offering") exempt from the registration requirements of the Securities Act of
1933, as amended (the "Securities Act").
The Company will receive no part of the proceeds of the sales made
hereunder. All expenses of registration incurred in connection with this
offering shall be borne by the Company, but all selling expenses incurred by the
Selling Shareholders shall be borne by such Selling Shareholders. The Company
and the Selling Shareholders have agreed to indemnify each other against certain
liabilities arising under the Securities Act. See "Selling Shareholders and Plan
of Distribution."
The Common Stock of the Company is traded on the Nasdaq National Market
under the symbol ATML.
SEE "RISK FACTORS" ON PAGE 5 FOR A DISCUSSION OF CERTAIN FACTORS THAT
SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK
OFFERED HEREBY.
The Selling Shareholders and any brokers participating in such sales may
be deemed underwriters within the meaning of the Securities Act. Commissions
received by any such broker may be deemed to be underwriting commissions under
the Securities Act. See "Selling Shareholders and Plan of Distribution."
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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.
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THE DATE OF THIS PROSPECTUS IS , 1997
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NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, IN CONNECTION
WITH THE OFFERING DESCRIBED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR ANY SELLING SHAREHOLDER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL, OR A SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF THE
SHARES BY ANY PERSON IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL FOR SUCH PERSON
TO MAKE SUCH OFFER, SOLICITATION OR SALE. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN
IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE HEREOF.
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 can be inspected and copied at the offices of
the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, as well as at the following regional offices of the
Commission: Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661; and Seven World Trade Center, Suite 1300, New York, New York
10048. Copies of such material can be obtained from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. Reports, proxy statements and other information filed
electronically by the Company with the Commission are available at the
Commission's worldwide web site at http://www.sec.gov. The Company's Common
Stock is listed on the Nasdaq National Market. Reports, proxy statements and
other information concerning the Company may be inspected at the office of The
Nasdaq Stock Market at 1735 K Street, N.W., Washington, D.C. 20006.
The Company has filed with the Commission a Registration Statement
(which term shall include all amendments, exhibits and schedules thereto) on
Form S-3 under the Securities Act with respect to the Shares offered hereby.
This Prospectus does not contain all the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission, and to which reference is hereby
made. Statements made in this Prospectus as to the contents of any document
referred to are not necessarily complete. With respect to each such document
filed as an exhibit to the Registration Statement, reference is made to the
exhibit for a more complete description of the matter involved, and each such
statement shall be deemed qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been filed with the Commission and are
incorporated herein by reference in this Prospectus:
(a) The Company's Proxy Statement for its 1997 Annual Meeting
of Shareholders dated March 19, 1997;
(b) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996;
(c) The Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 1997 and June 30, 1997;
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(d) The Company's Current Report on Form 8-K dated June 4, 1997;
and
(e) The description of the Company's Common Stock offered for
resale hereby contained in the Company's Registration
Statement on Form 8-A dated February 20, 1991, including any
amendment or report filed for the purpose of updating such
description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Prospectus and prior to the
filing of a post-effective amendment which indicates that all securities offered
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement incorporated
herein shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement and any statement contained herein
shall be deemed to be modified or superseded for all purposes to the extent that
a statement contained in any subsequently filed documents which is deemed to be
incorporated by reference modifies or supersedes such statement.
The Company will provide without charge to such person to whom this
Prospectus is delivered, upon the request of such person, a copy of any or all
of the foregoing documents incorporated herein by reference, other than exhibits
to such documents (unless such exhibits are specifically incorporated by
reference into such documents). Requests for such documents should be directed
to Atmel Corporation, 2325 Orchard Parkway, San Jose, California 95131,
Attention: Investor Relations, telephone (408) 441-0311.
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THE COMPANY
Atmel designs, develops, manufactures and markets a broad range of high
performance non-volatile memory and logic integrated circuits using its
proprietary complementary metaloxide semiconductor (CMOS) technologies. Atmel's
strategy is to offer products with enabling technology and features that allow
its customers to bring to market new, high value-added systems and products.
Atmel believes that its combination of CMOS process and design technologies
gives it a competitive advantage in developing and manufacturing products that
are highly reliable and are differentiated by speed, density, power usage and
specialty packaging. The Company's non-volatile memory products consist
primarily of erasable programmable read-only memories (EPROMs), electrically
erasable programmable read-only memories (EEPROMs) and Flash Memories. The
Company's logic products consist of programmable logic devices (EPLDs and
FPGAs), application-specific integrated circuits (ASICs), and Flash-based
microcontrollers. These products are used in a wide array of applications in the
computing, networking, telecommunications, industrial control and
instrumentation, consumer electronics, automotive and avionics markets. The
Company's customers comprise a diverse group of domestic and foreign original
equipment manufacturers and distributors, including 3Com, Adaptec, Ericsson,
Iomega, Matsushita, Motorola, Nokia, Northern Telecom, Samsung, Seagate, Sony,
Texas Instruments, U.S. Robotics, Western Digital and Xircom.
The Company's net revenues increased significantly from 1994 to 1996
reflecting increased sales across all product lines. Over the last three years,
Atmel's product strategy has evolved from being a supplier of specialized
products based on non-volatile memory to being a supplier of integrated
solutions on a single chip of silicon. The Company is able to integrate many of
its core technologies to deliver these system-on-a-chip solutions for its
targeted markets. The Company's current product roadmap consists of: (i)
expanding its presence in the Flash market; (ii) broadening its product
offerings across the 8-bit through 32-bit microcontroller markets; and (iii)
integrating its core technologies on a single chip. Specifically, the Company
has announced its 49 series products based on a new Flash memory architecture to
provide cost-effective data storage for wireless phones, personal computers,
peripherals and networking as well as voice and image storage. In the
microcontroller market, the Company has introduced a series of products based on
reduced-instruction-set computer (RISC) architecture across the 8-bit through
32-bit families. The Company believes its new Flash microcontroller products
offer exceptional performance at low cost for industrial control,
telecommunication, consumer, automotive, mobile and peripheral applications.
Lastly, the Company believes there is a significant cost and manufacturing
advantage in developing silicon-based system level solutions around its core
ASIC, DSP and analog technologies for end-markets such as cellular phones and
peripheral applications. As a result of its product strategies, the Company
believes it can offer one of the broadest product portfolios to meet the
functional requirements across its targeted end-markets.
Atmel believes that it is a leader in single and multiple layer metal,
non-volatile CMOS processing. At its wafer fabrication facilities in Colorado
Springs, Colorado and Rousset, France, the Company processes CMOS integrated
circuits in volume on 6-inch wafers with 0.5 micron feature sizes and uses its
BiCMOS process technology to integrate analog, logic and non-volatile memory
capabilities on a single integrated circuit. The Company is currently bringing
on line CMOS processes with 0.35 micron feature sizes, which will enable it to
further support the high performance requirements of its customers. By
maintaining its own wafer fabrication facilities the Company believes that it is
better able to implement new designs, improve its process technology, increase
its control over supply and costs, and respond quickly to changes in the markets
for the Company's products. The Company has made and plans to continue to make
substantial capital expenditures to increase its wafer fabrication capacity,
including the use of the proceeds of this Offering primarily for the expansion
of capacity at its facilities in Rousset.
Atmel was incorporated in California on December 5, 1984. Its principal
executive offices are located at 2325 Orchard Parkway, San Jose, California
95131, and its telephone number is (408) 441-0311. As used
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in this Prospectus, the terms "Atmel" and the "Company" refer to Atmel
Corporation and its consolidated subsidiaries, except as otherwise indicated.
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RISK FACTORS
This Prospectus contains trend analysis and other forward-looking
statements that involve risks and uncertainties. Actual results could differ
materially from those expressed or forecasted in the forward-looking statements
as a result of the risk factors set forth below and elsewhere in this
Prospectus. In addition to the other information contained and incorporated by
reference in this Prospectus, the following factors should be carefully
considered in evaluating the Company and its business before purchasing the
Common Stock offered hereby.
FACTORS AFFECTING REVENUE AND QUARTERLY OPERATING RESULTS
The Company believes future sales growth will depend substantially on
the success of new products. New products are generally incorporated into
customers' products or systems at the design stage. However, design wins may
precede volume sales generation by a year or more. No assurance can be given
that any design win will result in future revenues, which depend in large part
on the success of the customers' end product or system. For example, the Company
recently introduced new Flash products based on an architecture different from
its existing Flash products. These new Flash products are in the process of
being evaluated and qualified by potential customers, and no assurance can be
provided that these products will be accepted by the market or will result in
significant future revenues to the Company.
The Company believes that its future operating results will be subject
to quarterly variations based upon a wide variety of factors, including
fluctuations in manufacturing yields, the timing of introduction of new
products, changes in product mix, the extent of utilization of manufacturing
capacity, the cyclical nature of both the semiconductor industry and the markets
addressed by the Company's products, product obsolescence, price erosion,
competitive factors and fluctuations in currency exchange rates. Many of these
factors are outside the control of the Company. The Company's net revenues and
cost of sales vary depending upon the mix of products sold. Any unfavorable
changes in manufacturing yields or product mix, delays in new product
introductions, under-utilization of manufacturing capacity, increased price
competition, strengthening of the U.S. dollar against the local currencies in
the markets in which the Company sells products or other factors could
materially and adversely affect the Company's operating results.
For example, the Company's revenues and net income in the first half of
1997 declined approximately 6% and 31%, respectively, from the first half of
1996, due principally to a strengthening of the U.S. dollar, increased price
competition in the Company's EPROM and other non-volatile memory business and
delays in the qualifications of the Company's new Flash products. These factors,
as well as the other factors discussed above, could cause a decline in the
Company's net revenues in the third quarter of 1997, as compared with the third
quarter of 1996, and could materially and adversely affect the Company's
operating results in the second half of 1997 or future periods. In addition, due
in part to overcapacity in the semiconductor industry, the Company's quarterly
revenues and operating results have become increasingly dependent upon orders
booked and shipped within a given quarter. To the extent this trend continues,
the Company's quarterly results will be less predictable and subject to greater
variability.
While the Company has experienced rapid revenue and net income growth
over the past several years, there can be no assurance that this growth will
resume or continue in future periods.
RISK OF EXCESS CAPACITY; FABRICATION OF WAFERS
The Company has made substantial capital expenditures to increase its
wafer fabrication capacity at its facilities in Colorado Springs, Colorado and
Rousset, France. In addition, the Company plans to incur substantial capital
expenditures during the second half of 1997 to increase its wafer fabrication
capacity in its existing facilities and also to install equipment at its
facility in Rousset. As a
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result of the increase in fixed costs and operating expenses related to this
planned expansion of capacity, if the Company's revenues do not increase
substantially in the second half of 1997 and in future periods, the Company's
gross margin will continue to decline from the gross margin experienced in the
first half of 1997.
As the Company expands its fabrication facilities, it will also be
implementing new 0.35 micron CMOS process and other advanced processing
techniques and commencing production at Atmel ES2's new 8-inch wafer fabrication
facility in Rousset. The fabrication of integrated circuits, particularly
non-volatile, erasable CMOS memory and logic devices such as those manufactured
by the Company, is a highly complex and precise process, requiring production in
a tightly controlled, clean environment. Minute impurities, difficulties in the
fabrication process, defects in the masks used to print circuits on a wafer or
other factors can cause a substantial percentage of wafers to be rejected or
numerous die on each wafer to be non-functional. The Company may experience
problems in achieving acceptable yields in the manufacture of wafers,
particularly in connection with the expansion of its capacity and related
transitions. The interruption of wafer fabrication or the failure to achieve
acceptable manufacturing yields at any of the Company's facilities would have a
material adverse effect on the Company's operations.
There can be no assurance that market conditions will permit the
Company to fully utilize this increased wafer fabrication capacity or that the
increases in fixed costs and operating expenses related to this expansion of
capacity will not materially and adversely affect the Company's operating
results, if net revenues do not increase sufficiently from current levels.
Specifically, the Company's operating results in the second half of 1997 will be
adversely affected if the Company does not realize substantial revenues from its
new Flash products. The Company experienced production delays and yield
difficulties in connection with earlier expansions of its wafer fabrication
capacity and experienced overcapacity at its Colorado Springs facility in 1991.
Production delays, difficulties in achieving acceptable yields at its Colorado
Springs or its Rousset facility or overcapacity could materially and adversely
affect the Company's operating results.
CYCLICAL NATURE OF SEMICONDUCTOR INDUSTRY
The semiconductor industry has historically been characterized by wide
fluctuations in product supply and demand. From time to time, the industry has
also experienced significant downturns, often in connection with, or in
anticipation of, maturing product cycles and declines in general economic
conditions. These downturns have been characterized by diminished product
demand, production overcapacity and subsequent accelerated erosion of average
selling prices, and in some cases have lasted for more than a year. The
Company's business could be materially and adversely affected by industry wide
fluctuations in the future. The semiconductor industry experienced a downturn in
1996 and continuation of these conditions could materially and adversely affect
the Company's operating results. In the past, the Company's operating results
were adversely affected by industry-wide fluctuations in the demand for
semiconductors, which resulted in under-utilization of the Company's
manufacturing capacity. The Company's continued success will depend in large
part on the continued growth of various electronics industries that use
semiconductors, including manufacturers of computers, telecommunications
equipment, automotive electronics, industrial controls, consumer electronics
equipment and military equipment. No assurance can be given that the Company
will not be materially and adversely affected in the future by cyclical
conditions in the semiconductor industry or by slower growth in any of the
markets served by the Company's products.
COMPETITION
The semiconductor industry is intensely competitive and is
characterized by rapid technological change, rapid product obsolescence and
price erosion. Throughout its product line, the Company competes with a number
of semiconductor manufacturers, such as SGS Thompson, Intel and AMD, which are
among
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the largest in the world. These competitors have substantially greater
financial, technical, marketing and management resources than the Company. As
the Company introduces its new Flash products, it will be exposed increasingly
to competition from Intel and AMD, and there can be no assurance that the
Company will be able to compete effectively. The Company also competes with
emerging companies attempting to sell products in specialized markets such as
those addressed by the Company. The Company competes principally on the basis of
the technical innovation and performance of its CMOS products, including their
speed, density, power usage, reliability and specialty packaging alternatives,
as well as on price and product availability. The Company has increasingly
experienced significant price competition on its EPROM and other non-volatile
memory business.
In addition to the factors described above, the ability of the Company
to compete successfully depends on a number of factors, including its success in
designing and manufacturing new products that implement new technologies, its
ability to offer integrated solutions using its advanced non-volatile memory
process with other technologies, the rate at which customers incorporate the
Company's products into their systems, product introductions by the Company's
competitors, the number and nature of its competitors in a given market, and
general market and economic conditions. Many of these factors are outside of the
Company's control. There can be no assurance that the Company will be able to
compete successfully in the future.
NEW PRODUCT DEVELOPMENT AND TECHNOLOGICAL CHANGE
The average selling prices of the Company's products historically have
decreased over the products' lives and are expected to continue to do so. To
offset average selling price decreases typically experienced over the life of
any particular product, the Company relies primarily on obtaining cost
reductions in the manufacture of those products, increased unit demand to absorb
fixed costs and introducing new, higher priced products which incorporate
advanced features or address new or emerging markets. To the extent that such
cost reductions, increased unit demand or new product introductions do not occur
in a timely manner, the Company's operating results will be adversely affected.
As a result, the Company's future success depends on its ability to
develop and introduce new products which compete effectively on the basis of
price and performance and which address customer requirements. The Company is
continually in the process of designing and commercializing new and improved
products to maintain its competitive position. The success of new product
introductions is dependent upon several factors, including timely completion and
introduction of new product designs, achievement of acceptable fabrication
yields and market acceptance. The development of new products by the Company and
their design-in to customers' systems can take as long as three years, depending
upon the complexity of the device and the application. Accordingly, new product
development requires a long-term forecast of market trends and customer needs,
and the successful introduction of the Company's products may be adversely
affected by competing products or technologies serving markets addressed by the
Company's products. For example, the Company's operating results for the first
and second quarters of 1997 were adversely impacted in part by delays in the
qualification of the Company's new Flash products.
In addition, new product introductions frequently depend on the
Company's development and implementation of new process technologies. The
Company believes that its future growth will depend in part upon the development
and the market's acceptance of these products. In addition, as the Company
develops its integrated solution products, it will require more technically
sophisticated sales and marketing personnel to market these products
successfully to its customers. The Company is developing new products with
smaller feature sizes, the fabrication of which will be substantially more
complex than fabrication of the Company's current products. If the Company is
unable to design, develop, manufacture, market and sell new products
successfully, its operating results will be adversely affected. No assurance can
be given that the Company's
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product, process development, design, marketing and sales efforts will be
successful or that its new products will achieve market acceptance.
INTERNATIONAL SALES AND OPERATIONS
Foreign product sales to customers accounted for approximately 49%,
52%, 57% and 56% of net revenues in 1994, 1995 and 1996, and the first six
months of 1997, respectively. Atmel expects that revenues derived from
international sales will continue to represent a significant portion of net
revenues. In addition, in recent years, Atmel has significantly expanded its
international operations. International sales and operations are subject to a
variety of risks, including those arising from currency fluctuations, tariffs,
trade barriers, taxes, export license requirements and foreign government
regulations. Because most of the Company's foreign sales are denominated in U.S.
dollars, the Company's products become less price competitive in countries with
currencies declining in value against the dollar. In particular, in the first
half of 1997, the Company's operating results were adversely impacted in part by
a strengthening of the U.S. dollar against local currencies in the markets in
which the Company sells products. There can be no assurance that the Company
will not experience similar adverse effects in the second half of 1997 or future
periods.
INTELLECTUAL PROPERTY MATTERS
The Company has from time to time received, and may in the future
receive, communications from third parties asserting patent or other
intellectual property rights covering the Company's products or processes.
During the past year, the Company has received specific allegations from two
major companies alleging that certain of the Company's products infringe patents
owned by such companies. The Company is currently evaluating these allegations
and believes that a resolution, either as a result of a determination that the
patents are invalid or are not infringed by the Company's products or,
alternatively, by securing a license to the patents, will not have a material
adverse effect on the Company's financial condition. No assurance can be
provided, however, that the Company would prevail in any litigation relating to
invalidity or non-infringement or that any such license can be obtained on
reasonable terms or at all. In addition, the semiconductor industry is
characterized by vigorous protection and pursuit of intellectual property rights
or positions, which have on occasion resulted in significant and often
protracted and expensive litigation. In the past, the Company has been involved
in such litigation, which adversely affected its operating results. There can be
no assurance that these and other intellectual property claims will not be made
against the Company in the future or that the Company will not be prohibited
from using the technologies subject to such claims or required to obtain
licenses and make corresponding royalty payments. In addition, the necessary
management attention to and legal costs associated with litigation can have a
significant adverse effect on operating results.
FUTURE CAPITAL NEEDS
Semiconductor companies that maintain their own fabrication facilities
have substantial capital requirements. The Company intends to continue to make
significant investments in capital equipment and expansion of facilities, as
well as in research and development. The Company is making substantial capital
expenditures in 1997 to increase its wafer fabrication capacity at its Colorado
Springs facility and to bring on-line new 8-inch wafer fabrication facility in
Rousset. The Company may seek additional equity or debt financing to fund
further expansion of its wafer fabrication capacity or to fund other projects.
The timing and amount of such capital requirements cannot be precisely
determined at this time and will depend on a number of factors, including demand
for the Company's products, product mix, changes in semiconductor industry
conditions and competitive factors. There can be no assurance that such
additional financing will be available when needed or, if available, will be on
satisfactory terms.
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DEPENDENCE ON INDEPENDENT ASSEMBLY CONTRACTORS
The Company manufactures wafers for its products at its fabrication
facilities. The wafers are then sorted and probed at the Company's facilities.
After wafer probing, the Company ships the wafers to one of the Company's
independent assembly contractors located in the Philippines, South Korea, Taiwan
and Thailand where the wafers are separated into die, packaged and, in some
cases, tested. The Company's reliance on independent contractors to assemble,
package and test its products involves significant risks, including reduced
control over quality and delivery schedules, the potential lack of adequate
capacity and discontinuance or phaseout of such contractors' assembly processes.
In addition, the Company is currently incorporating new packaging types into its
products and is dependent upon third party contractors for such new packaging.
There can be no assurance that such contractors will continue to assemble,
package and test products, or implement new packaging technology, for the
Company. Further, because the Company's assembly contractors are located in
foreign countries, the Company is subject to certain risks generally associated
with contracting with foreign suppliers, including currency exchange
fluctuations, political and economic instability, trade restrictions and changes
in tariff and freight rates. There can be no assurance that the Company will not
experience problems in timeliness, adequacy or quality of product deliveries,
any of which could have a material adverse effect on the Company's results of
operations.
ENVIRONMENTAL REGULATIONS
The Company is subject to a variety of federal, state and local
governmental regulations related to the discharge or disposal of toxic, volatile
or otherwise hazardous chemicals used in its manufacturing process. While the
Company believes that it has all environmental permits necessary to conduct its
business and that its activities conform to present environmental regulations,
increasing public attention has been focused on the environmental impact of
semiconductor operations. While the Company has not experienced any material
adverse effect on its operations from environmental regulations, there can be no
assurance that changes in such regulations will not impose the need for
additional capital equipment or other requirements. Any failure by the Company
to control the use of, or to restrict adequately the discharge of, hazardous
substances under present or future regulations could subject it to substantial
liability or cause its manufacturing operations to be suspended.
DEPENDENCE ON KEY PERSONNEL
The Company's future success depends in large part on the continued
service of its key technical and management personnel and on its ability to
continue to attract and retain qualified employees, particularly those highly
skilled design, process and test engineers involved in the manufacture of
existing products and the development of new products and processes. The
competition for such personnel is intense, and the loss of key employees, none
of whom is subject to an employment agreement for a specified term or a
post-employment non-competition agreement, could have a material adverse effect
on the Company.
MANAGEMENT OF GROWTH
The Company has grown rapidly in recent years, and continued growth may
cause a significant strain on the Company's infrastructure and internal systems.
To manage its growth effectively, the Company must continue to improve and
expand its management information systems and business processes. The Company's
success depends to a significant extent on the management skills of its
executive officers. If the Company is unable to manage its growth effectively,
the Company's results of operations will be materially and adversely affected.
VOLATILITY OF STOCK PRICE
-9-
<PAGE> 12
The market price of the Company's Common Stock has experienced
significant fluctuations and may continue to fluctuate significantly. The market
price of the Common Stock may be significantly affected by factors such as the
announcement of new products or product enhancements by the Company or its
competitors, technological innovation by the Company or its competitors,
quarterly variations in the Company's results of operations, changes in earnings
estimates by market analysts, and general market conditions or market conditions
specific to particular industries. In particular, the stock prices for many
companies in the technology and emerging growth sector have experienced wide
fluctuations which have often been unrelated to the operating performance of
such companies. Such fluctuations may adversely affect the market price of the
Common Stock.
-10-
<PAGE> 13
USE OF PROCEEDS
There will be no proceeds to the Company from the issuance of the
Common Stock upon conversion of Notes by the holders thereof.
SELLING SHAREHOLDERS AND PLAN OF DISTRIBUTION
The Selling Shareholders are those individuals and entities who will
from time to time hold the Shares. The Notes are convertible at any time prior
to the close of business on June 1, 2002, subject to prior redemption, into
shares of Common Stock at a conversion price of $35.50 per share (equivalent to
a conversion rate of approximately 28.17 shares per $1000 principal amount of
notes), subject to adjustment under certain circumstances specified in the
Indenture. Accordingly, the number of shares of Common Stock issuable upon
conversion of the Notes may change. As of the date of this Prospectus, the
aggregate principal amount of Notes outstanding is $150,000,000, which may be
converted into 4,225,352 shares of Common Stock.
Pursuant to a Registration Rights Agreement dated May 15, 1997 (the
"Registration Rights Agreement") between the Company and the initial purchasers
named therein entered into in connection with the Note Offering (included herein
as Exhibit 4.1), the Company has filed with the Commission under the Securities
Act a Registration Statement on Form S-3, of which this Prospectus forms a part,
with respect to the resale of the Shares from time to time and has agreed to use
its reasonable efforts to keep such Registration Statement effective until the
earlier of (i) May 19, 1999 or (ii) the date that all Registrable Securities (as
defined in the Registration Rights Agreement) have ceased to be Registrable
Securities. Pursuant to the Registration Rights Agreement, the Company may
suspend the use of this Prospectus for the sale of Shares under certain
circumstances relating to pending material corporate developments or similar
material events for up to a period not to exceed a single thirty (30) day period
in any three month period or two thirty (30) day periods in any 12 month period.
As of the date of this Prospectus, none of the Notes have been
converted, and as a result, the Company is not aware of any proposed Selling
Shareholder. Such Selling Shareholders will be qualified institutional buyers
within the meaning of Rule 144A or non-U.S. persons within the meaning of
Regulation S under the Securities Act. Prior to any use of this Prospectus for
resale of the Shares registered herein, this Prospectus will be amended or
supplemented to set forth the name of the Selling Shareholder, the number of
Shares beneficially owned by such Selling Shareholder, and the number of Shares
to be offered for resale by such Selling Shareholder. The supplemented or
amended Prospectus will also disclose whether such Selling Shareholder has held
any position or office with, been employed by or otherwise had a material
relationship with, the Company or any of its affiliates during the three years
prior to the date of the supplemented or amended Prospectus.
Each of the Selling Shareholders will act independently of the Company
in making decisions with respect to the timing, manner and size of each sale.
The Selling Shareholder may choose to sell Shares from time to time at market
prices prevailing at the time of the sale, at prices related to the then
prevailing market prices or in negotiated transactions, including pursuant to an
underwritten offering or pursuant to one or more of the following methods: (a)
block trades in which the broker or dealer so engaged will attempt to sell the
Shares as agent but may position and resell a portion of the block as principal
to facilitate the transaction, (b) purchases by a broker or dealer as principal
and resale by such broker or dealer for its account pursuant to this Prospectus,
and (c) ordinary brokerage transactions and transactions in which the broker
solicits purchasers.
In connection with the sale of Shares, Selling Shareholders may engage
broker-dealers who in turn may arrange for other broker-dealers to participate.
Broker-dealers may receive commissions or discounts from the Selling
Shareholders in amounts to be negotiated immediately prior to the sale. In
addition, underwriters
-11-
<PAGE> 14
or agents may receive compensation from the Selling Shareholders or from
purchasers of the Shares for whom they may act as agents, in the form of
discounts, concessions or commissions. Underwriters may sell Shares to or
through dealers, such dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters or commissions from the
purchasers for whom they act as agents. Underwriters, dealers and agents that
participate in the distribution of Shares may be deemed to be underwriters and
any discounts or commissions received by them from the Selling Shareholders and
any profit on the resale of Shares by them may be deemed to be underwriting
discounts and commissions under the Securities Act. Any such underwriter or
agent will be identified, and any such compensation received from the Selling
Shareholders will be described, in the applicable Prospectus supplement.
The Company and the Selling Shareholders have agreed to indemnify each
other against certain liabilities arising under the Securities Act. The Company
has agreed to pay all expenses incident to the offer and sale of the Shares by
the Selling Shareholders to the public, other than selling expenses incurred by
the Selling Shareholder and registration expenses to the extent that the Company
is prohibited from paying for such expenses on behalf of the Selling
Shareholders by applicable Blue Sky laws.
LEGAL MATTERS
The validity of the Common Stock being offered for sale hereby will be
passed upon for the Company by Wilson Sonsini Goodrich & Rosati, Professional
Corporation, Palo Alto, California.
EXPERTS
The consolidated balance sheets of Atmel Corporation and
subsidiaries as of December 31, 1996 and 1995, and the consolidated statements
of income, cash flows and shareholders' equity for each of the years in the
period ended December 31, 1996, incorporated by reference in this Registration
Statement have been incorporated herein in reliance upon the report of Coopers &
Lybrand L.L.P., independent accountants, and given on the authority of that firm
as experts in accounting and auditing.
-12-
<PAGE> 15
ATMEL CORPORATION
REGISTRATION STATEMENT ON FORM S-3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14 OTHER EXPENSES OF REGISTRATION AND DISTRIBUTION.
The following table sets forth costs and expenses of the sale and
distribution of the securities being registered. All amounts except Securities
and Exchange Commission and Nasdaq Stock Market Listing fees are estimates.
<TABLE>
<S> <C>
Registration fee - Securities and Exchange Commission............ $ 45,455.00
Nasdaq Stock Market listing fee.................................. $ 2,000.00
Accounting fees.................................................. $ 3,500.00
Legal fees....................................................... $ 6,500.00
Miscellaneous.................................................... $ 545.00
-----------
Total................................................... $ 58,000.00
===========
</TABLE>
ITEM 15 INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 317 of the California Corporations Code authorizes a court to
award, or a corporation's Board of Directors to grant, indemnity 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 "Securities
Act"). Article IV of the Company's Restated Articles of Incorporation and
Article VI of the Company's Bylaws provide for indemnification of its directors,
officers, employees and other agents to the maximum extent permitted by the
California Corporations Code. In addition, the Company has entered into
Indemnification Agreements with its officers and directors which, among other
things, (i) require the indemnification of such individuals in circumstances
where indemnification would otherwise be permissive, (ii) require the Company to
maintain in effect directors' and officers' liability insurance covering such
individuals, unless such insurance is not available on reasonable terms, (iii)
require the Company to advance expenses incurred by such individuals in
connection with the investigation, defense, settlement or appeal of any
proceeding, provided that such individuals undertake to repay any amounts for
which such individual is ultimately determined not to be entitled to
indemnification, (iv) establish the presumption that the indemnified party has
met the applicable standard of conduct required for indemnification and (v) set
forth certain notice procedures in the event of a threat or the commencement of
a proceeding. The Company has obtained insurance on behalf of its officers and
directors against losses arising from any claim asserted against or incurred by
such individuals in any such capacity, subject to certain exclusions.
The Company understands that the staff of the Securities and Exchange
Commission is of the opinion that statutory, charter and contractual provisions
as are described above have no effect on claims arising under the federal
securities laws.
II-1
<PAGE> 16
ITEM 16 EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
------
<S> <C>
4.1 Registration Rights Agreement by and among Atmel Corporation
and Deutsche Morgan Grenfell Inc., Alex. Brown & Sons,
Incorporated, BNP plc, Credit Lyonnais Securities, Smith
Barney Inc. and Societe Generale Securities Corp. dated as
of May 15, 1997.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation, as to the legality of the shares of Common
Stock being registered.
23.1 Consent of Coopers & Lybrand LLP, independent accountants.
23.1 Consent of Counsel (contained in Exhibit 5.1 hereto).
24.1 Power of Attorney (see page II-4).
</TABLE>
ITEM 17 UNDERTAKINGS.
1. The undersigned Registrant hereby undertakes:
(a) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration
Statement (or the most recent post-effective
amendment hereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in this Registration Statement;
(iii) to include any material information with respect to
the plan of distribution not previously disclosed in
this Registration Statement or any material change to
such information in this Registration Statement;
provided, however, that the undertakings set forth in paragraph (i) and (ii)
above shall not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act") that are incorporated by reference in
this Registration Statement.
(b) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
2. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in this Registration Statement shall be
II-2
<PAGE> 17
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
3. 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 foregoing provisions 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.
II-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Jose, State of California on August 15, 1997.
ATMEL CORPORATION
By: /s/ Kris Chellam
----------------------------------------------
Kris Chellam,
Vice President, Finance and Administration and
Chief Financial Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints George Perlegos and Kris Chellam and each of them, with full power to
act without the other, as his true and lawful attorney-in-fact and agent, each
with full power of substitution, for him and in his name, place and stead, in
any and all capacities (unless revoked in writing), to sign any and all
amendments to this Form S-3 Registration Statement (including post-effective
amendments and registration statements filed pursuant to Rule 462), and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting to such
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 could do in
person, hereby ratifying and confirming all that each of said attorneys-in-fact
and agents, 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, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ George Perlegos
- -------------------
(George Perlegos) President, Chief Executive Officer (Principal August 15, 1997
Executive Officer) and Chairman of the Board of
Directors
/s/ Kris Chellam
- -----------------
(Kris Chellam) Vice President, Finance and Administration and Chief August 15, 1997
Financial Officer (Principal Financial and Accounting
Officer)
/s/ Gust Perlegos
- ------------------
(Gust Perlegos) Director August 15, 1997
</TABLE>
II-4
<PAGE> 19
<TABLE>
<S> <C> <C>
/s/ Tsung-Ching Wu
- --------------------
(Tsung-Ching Wu) Director August 15, 1997
/s/ Norm Hall
- -------------------
(Norm Hall) Director August 15, 1997
/s/ T. Peter Thomas
- -------------------
(T. Peter Thomas) Director August 15, 1997
</TABLE>
II-5
<PAGE> 20
ATMEL CORPORATION
REGISTRATION STATEMENT ON FORM S-3
INDEX TO EXHIBITS
<TABLE>
EXHIBIT
SEQUENTIALLY
NUMBER
NUMBERED
PAGE DESCRIPTION
------------ ---------------------------------------------------------------
<S> <C>
4.1 Registration Rights Agreement by and among Atmel Corporation
and Deutsche Morgan Grenfell Inc., Alex. Brown & Sons,
Incorporated, BNP plc, Credit Lyonnais Securities, Smith
Barney Inc. and Societe Generale Securities Corp. dated as of
May 15, 1997.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation, as to the legality of the shares of Common Stock
being registered.
23.1 Consent of Coopers & Lybrand LLP, independent accountants.
23.3 Consent of Counsel (contained in Exhibit 5.1 hereto).
24.1 Power of Attorney (see page II-4).
</TABLE>
<PAGE> 1
EXHIBIT 4.1
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
entered into as of May 15, 1997, by and among Atmel Corporation, a California
corporation (the "Company"), and Deutsche Morgan Grenfell Inc., Alex. Brown &
Sons, Incorporated, BNP plc, Credit Lyonnais Securities, Smith Barney Inc. and
Societe Generale Securities Corp. (the "Initial Purchasers") pursuant to the
Purchase Agreement, dated May 19, 1997 (the "Purchase Agreement"), among the
Company, Atmel S.A., a societe anonyme organized under the laws of The Republic
of France and an indirect wholly owned subsidiary of the Company (the "Issuer"),
and The Initial Purchasers. In order to induce the Initial Purchasers to enter
into the Purchase Agreement, the Company and the Issuer have agreed to provide
the registration rights set forth in this Agreement. The execution of this
Agreement is a condition to the closing under the Purchase Agreement.
The Company agrees with the Initial Purchasers, (i) for their benefit
as Initial Purchasers and (ii) for the benefit of the holders from time to time
of the Notes (including the Initial Purchasers) and the holders from time to
time of the Common Stock issued upon conversion of the Notes (each of the
foregoing a "Holder" and together the "Holders"), as follows:
4. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Affiliate: "Affiliate" means, with respect to any specified
person, (i) any other person directly or indirectly controlling or controlled
by, or under direct or indirect common control with, such specified person or
(ii) any executive officer or director of such other person. For purposes of
this definition, the term "control" (including the terms "controlling,"
"controlled by" and "under common control with") of a person means the
possession, direct or indirect, of the power (whether or not exercised) to
direct or cause the direction of the management and policies of a person,
whether through the ownership of voting securities, by contract, or otherwise.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and
Friday that is not a day on which banking institutions in The City of New York
or Los Angeles, California are authorized or obligated by law or executive order
to close.
Common Stock: The shares of common stock, no par value per
share, of the Company and any other shares of common stock as may constitute
"Common Stock" for purposes of the Indenture, in each case, as issuable or
issued upon conversion of the Notes.
Damages Accrual Period: See Section 2(c) hereof.
Damages Payment Date: Each of the semi-annual interest payment
dates provided in the Indenture.
Deferral Period: See Section 2(d) hereof.
Effectiveness Period: The period commencing with the date
hereof and ending on the earlier of the date that is two years after the latest
date of original issuance of the Notes and the date that all Registrable
Securities have ceased to be Registrable Securities.
<PAGE> 2
Event: See Section 2(e) hereof.
Event Date: See Section 2(e) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended,
and the Rules and Regulations of the SEC promulgated thereunder.
Filing Date: See Section 2(a) hereof.
Holder: See the second paragraph of this Agreement.
Indenture: The Indenture, dated as of May 15, 1997, among the
Issuer, the Company and State Street Bank and Trust Company of California,
N.A., as trustee, pursuant to which the Notes are being issued, as amended or
supplemented from time to time in accordance with the terms hereof.
Initial Purchasers: See the first paragraph of this Agreement.
Initial Shelf Registration: See Section 2(a) hereof.
Liquidated Damages: See Section 2(e) hereof.
Losses: See Section 6 hereof.
Manager: As such term is defined in the Purchase Agreement.
Managing Underwriters: The investment banking firm or firms
that shall manage or co-manage an Underwritten Offering.
Notes: The 3.25% Convertible Subordinated Guaranteed Step-Up
Notes due 2002 of the Company being issued and sold pursuant to the Purchase
Agreement and the Indenture.
Notice Holder: See Section 2(d)(i) hereof.
Purchase Agreement: See the first paragraph of this Agreement.
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any amendment or prospectus
supplement, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
Record Holder: (i) with respect to any Damages Payment Date
relating to any Note as to which any such Liquidated Damages have accrued, the
registered holder of such Note on the record date with respect to the interest
payment date under the Indenture on which such Damages Payment Date shall occur
and (ii) with respect to any Damages Payment Date relating to any Common Stock
as to which any such Liquidated Damages have accrued, the registered holder of
such Common Stock 15 days prior to the next succeeding Damages Payment Date.
Registrable Securities: The Common Stock into which the Notes
are convertible or converted, whether or not such Notes have been converted (and
associated rights), and at all times subsequent thereto,
<PAGE> 3
and any Common Stock issued with respect thereto upon any stock dividend, split
or similar event until, in the case of any such Common Stock, (i) it is
effectively registered under the Securities Act and disposed of in accordance
with the Registration Statement covering it, (ii) it is saleable by the holder
thereof pursuant to Rule 144(k) or (iii) it is sold to the public pursuant to
Rule 144, and, as a result of the event or circumstance described in any of the
foregoing clauses (i) through (iii), the legends with respect to transfer
restrictions required under the Indenture (other than any such legends required
solely as the consequence of the fact that the Registrable Securities (or the
Notes, upon the conversion of which, such Registrable Securities were issued or
are issuable) are owned by, or were previously owned by, the Company, the
Issuer, or an Affiliate of the Company or the Issuer) are removed or removable
in accordance with the terms of the Indenture.
Registration Expenses: See Section 5 hereof.
Registration Statement: Any registration statement of the
Company which covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective amendments,
all exhibits, and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
Rule 144A: Rule 144A under the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations promulgated by the SEC thereunder.
Selling Period: See Section 2(d)(i) hereof.
Shelf Registration: See Section 2(a) hereof.
Special Counsel: Venture Law Group, A Professional
Corporation, or such other successor counsel as shall be specified by the
holders of a majority of the Registerable Securities, the fees and expenses of
which will be paid by the Company pursuant to Section 5 hereof.
Subsequent Shelf Registration: See Section 2(b) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The Trustee under the Indenture.
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public, provided, that the Managing Underwriters of an
Underwritten Offering shall be approved by the Company, which approval shall not
be unreasonably withheld.
<PAGE> 4
5. Shelf Registration.
(a) Shelf Registration. The Company shall prepare and file
with the SEC, as soon as practicable but in any event on or prior to the date
ninety (90) days following the latest date of original issuance of the Notes
(the "Filing Date"), a Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415 of the Securities Act (a "Shelf
Registration") registering the resale from time to time by Holders thereof of
all of the Registrable Securities upon and following conversion of the Notes
(the "Initial Shelf Registration"). The Initial Shelf Registration shall be on
Form S-3 or another appropriate form permitting registration of such Registrable
Securities for resale by such Holders in the manner or manners designated by
them (including, without limitation, one or more Underwritten Offerings). The
Company shall use its reasonable efforts to cause the Initial Shelf Registration
to be declared effective under the Securities Act as soon as practicable and, in
any event, within one hundred and eighty (180 )days following the latest date of
original issuance of the Notes and to keep the Initial Shelf Registration
effective under the Securities Act until the earlier of the expiration of the
Effectiveness Period or the date a Subsequent Shelf Registration, as defined
below, covering all of the Registrable Securities has been declared effective
under the Securities Act.
(b) If the Initial Shelf Registration or any Subsequent Shelf
Registration, as defined below, ceases to be effective for any reason as a
result of the issuance of a stop order by the SEC at any time during the
Effectiveness Period, the Company shall use its reasonable efforts to obtain the
prompt withdrawal of any order suspending the effectiveness thereof, and in any
event shall within thirty (30) days of such cessation of effectiveness amend the
Shelf Registration in a manner reasonably expected to obtain the withdrawal of
the order suspending the effectiveness thereof, or file an additional Shelf
Registration covering all of the Registrable Securities (a "Subsequent Shelf
Registration"). If a Subsequent Shelf Registration is filed, the Company shall
use its reasonable efforts to cause the Subsequent Shelf Registration to be
declared effective as soon as practicable after such filing and to keep such
Registration Statement continuously effective until the end of the Effectiveness
Period.
(c) The Company shall supplement and amend the Shelf
Registration if required by the rules, regulations or instructions applicable to
the registration form used by the Company for such Shelf Registration, if
required by the Securities Act, or if reasonably requested by the Initial
Purchasers or by the Trustee on behalf of a majority of the Holders of the
Registrable Securities covered by such Registration Statement or by any Managing
Underwriter of such Registrable Securities in the event of an Underwritten
Offering of the Registrable Securities.
(d) Each Holder of Registrable Securities agrees that if
Holder wishes to sell its Registrable Securities pursuant to a Shelf
Registration and related Prospectus, it will do so only in accordance with this
Section 2(d). Each Holder of Registrable Securities agrees to give written
notice to the Company at least three Business Days prior to any intended
distribution of Registrable Securities under the Shelf Registration, which
notice shall specify the date on which such Holder intends to begin such
distribution and any information with respect to such Holder and the intended
distribution of Registrable Securities by such Holder as may be required to
amend the Registration Statement or supplement the related Prospectus with
respect to such intended distribution of Registrable Securities by such Holder
(the "Requisite Information"). In the event the Holder fails to provide the
Requisite Information in its initial notice of its intention to distribute the
Registrable Securities pursuant to the Registration Statement, the Company will
promptly request such Holder to provide such Requisite Information. As soon as
practicable after the date such notice is provided, and in any event within two
Business Days after such date, the Company shall either:
(i) (A) If necessary, prepare and file with the
Commission a post-effective amendment to the Shelf Registration or a supplement
to the related Prospectus or a supplement or amendment to any document
incorporated therein by reference or file any other required document so that
such
<PAGE> 5
Registration Statement will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and so that, as thereafter delivered
to purchasers of the Registrable Securities being sold thereunder, such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; (B) provide the Notice Holders (as defined below) copies of any
documents filed pursuant to Section 2(d)(i)(A); and (C) inform the Notice
Holders that the Company has complied with its obligations in Section 2(d)(i)(A)
(or that, if the Company has filed a post-effective amendment to the Shelf
Registration which has not yet been declared effective, the Company will notify
the Notice Holders to that effect, will use its reasonable efforts to secure the
effectiveness of such post-effective amendment and will immediately notify the
Notice Holders when the amendment has become effective); each Holder who has
given notice of intention to distribute such Holder's Registrable Securities in
accordance with Section 2(d) hereof (a "Notice Holder") will sell all or any of
such Registrable Securities pursuant to the Shelf Registration and related
Prospectus only during the 45-day period commencing with the date on which the
Company gives notice, pursuant to Section 2(d)(i)(C), that the Registration
Statement and Prospectus may be used for such purpose (such 45-day period is
referred to as a "Selling Period"). The Notice Holders will not sell any
Registrable Securities pursuant to such Registration Statement or Prospectus
after such Selling Period without giving a new notice of intention to sell
pursuant to Section 2(d) hereof and receiving a further notice from the Company
pursuant to Section 2(d)(i)(C) hereof.
(ii) in the event (A) of the happening of any event
of the kind described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or
3(c)(vi) hereof or (B) that, in the judgment of the Company, it is advisable to
suspend use of the Prospectus for a discrete period of time due to pending
material corporate developments or similar material events that have not yet
been publicly disclosed and as to which the Company believes public disclosure
will be prejudicial to the Company, the Company shall deliver a certificate in
writing, signed by an authorized executive officer of the Company, to the Notice
Holders, the Special Counsel and the Managing Underwriters, if any, to the
effect of the foregoing and, upon receipt of such certificate, each such Notice
Holder's Selling Period will not commence until such Notice Holder's receipt of
copies of the supplemented or amended Prospectus provided for in Section
2(d)(i)(A) hereof, or until it is advised in writing by the Company that the
Prospectus may be used, and has received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in such Prospectus. The Company will use its reasonable efforts to ensure that
the use of the Prospectus may be resumed, and the Selling Period will commence,
as soon as practicable and, in the case of a pending development or event
referred to in Section 2(d)(ii)(B) hereof, as soon as the earlier of (x) public
disclosure of such pending material corporate development or similar material
event or (y) in the judgment of the Company, public disclosure of such material
corporate development or similar material event would not be prejudicial to the
Company. Notwithstanding the foregoing, (A) the Company shall not under any
circumstances be entitled to exercise its right under this Section 2(d)(ii) to
defer the commencement of a Selling Period more than one (1) time in any three
(3) month period or two (2) times in any twelve (12) month period, and the
period in which a Selling Period is suspended shall not exceed fifteen (15) days
unless the Company shall deliver to such Notice Holders a second notice to the
effect set forth above, which shall have the effect of extending the period
during which such Selling Period is deferred by up to an additional fifteen (15)
days, or such shorter period of time as is specified in such second notice, and
(B) in no event shall the Company be permitted to extend the period during which
such Selling Period is deferred from and after the date a Notice Holder provides
notice to the Company in accordance with this Section 2(d) of its intention to
distribute Registrable Securities (a "Deferral Period") beyond such thirty (30)
day period, provided, that the Company may suspend the use of such Prospectus
for longer periods so long as the Company complies with its obligations, if any,
to pay Liquidated Damages in accordance with Section 2(e) hereof.
<PAGE> 6
(e) The parties hereto agree that the Holders of Registrable
Securities will suffer damages, and that it would not be feasible to ascertain
the extent of such damages with precision, if (i) the Initial Shelf Registration
has not been filed on or prior to the Filing Date, (ii) prior to the end of the
Effectiveness Period, the SEC shall have issued a stop order suspending the
effectiveness of the Shelf Registration or proceedings have been initiated with
respect to the Shelf Registration under Section 8(d) or 8(e) of the Securities
Act, (iii) the aggregate number of days in any one Deferral Period exceeds the
periods permitted pursuant to Section 2(d)(ii) hereof or (iv) the number of
Deferral Periods exceeds the number permitted pursuant to Section 2(d)(ii)
hereof (each of the events of a type described in any of the foregoing clauses
(i) through (iv) are individually referred to herein as an "Event," and the
Filing Date in the case of clause (i), the date on which the effectiveness of
the Shelf Registration has been suspended or proceedings with respect to the
Shelf Registration under Section 8(d) or 8(e) of the Securities Act have been
commenced in the case of clause (ii), the date on which the duration of a
Deferral Period exceeds the periods permitted by Section 2(d)(ii) hereof in the
case of clause (iii), and the date of the commencement of a Deferral Period that
causes the limit on the number of Deferral Periods under Section 2(d)(ii) hereof
to be exceeded in the case of clause (iv), being referred to herein as an "Event
Date"). Events shall be deemed to continue until the date of the termination of
such Event, which shall be the following dates with respect to the respective
types of Events: the date the Initial Registration Statement is filed in the
case of an Event of the type described in clause (i), the date that all stop
orders suspending effectiveness of the Shelf Registration have been removed and
the proceedings initiated with respect to the Shelf Registration under Section
8(d) or 8(e) of the Securities Act have terminated, as the case may be, in the
case of Events of the types described in clause (ii), termination of the
Deferral Period which caused the aggregate number of days in any one Deferral
Period to exceed the number permitted by Section 2(d)(ii) to be exceeded in the
case of Events of the type described in clause (iii), and termination of the
Deferral Period the commencement of which caused the number of Deferral Periods
permitted by Section 2(d)(ii) to be exceeded in the case of Events of the type
described in clause (iv).
Accordingly, upon the occurrence of any Event and until such time as
there are no Events which have occurred and are continuing (a "Damages Accrual
Period"), commencing on the Event Date on which such Damages Accrual Period
began, the Company agrees to pay (or cause the Issuer to pay), as liquidated
damages, and not as a penalty, an additional amount (the "Liquidated Damages"):
(A)(i) to each holder of a Note that is a Notice Holder, accruing at a rate
equal to one-quarter of one percent per annum (25 basis points) on the aggregate
principal amount of Notes held by such Notice Holder and (ii) to each holder of
Common Stock that is a Notice Holder, accruing at a rate equal to one-quarter of
one percent per annum (25 basis points) calculated on an amount equal to the
product of (x) the then-applicable Conversion Price (as defined in the
Indenture), times (y) the number of shares of Common Stock held by such holder;
and (B) if the Damages Accrual Period continues for a period in excess of thirty
(30) days from the Event Date, from and after the end of such thirty (30) days
until such time as there are no Events which have occurred and are continuing,
(i) to each holder of a Note (whether or not a Notice Holder), accruing at a
rate equal to one-quarter of one percent per annum (25 basis points) on the
aggregate principal amount of Notes held by such holder and (ii) to each holder
of Common Stock (whether or not a Notice Holder), accruing at a rate equal to
one-quarter of one percent per annum (25 basis points) calculated on an amount
equal to the product of (x) the then-applicable Conversion Price (as defined in
the Indenture), times (y) the number of shares of Common Stock held by such
holder. Notwithstanding the foregoing, no Liquidated Damages shall accrue under
clause (A) for the preceding sentence during any period for which Liquidated
Damages accrue under clause (B) of the preceding sentence or as to any
Registrable Securities from and after the earlier of (x) the date such
securities are no longer Registrable Securities, and (y) the expiration of the
Effectiveness Period. The rate of accrual of the Liquidated Damages with respect
to any period shall not exceed the rate provided for in this paragraph
notwithstanding the occurrence of multiple concurrent Events.
The Company shall pay (or cause the Issuer to pay) the Liquidated
Damages due on any Notes or Common Stock by depositing with the Trustee under
the Indenture, in trust, for the benefit of the holders of
<PAGE> 7
Notes or Common Stock or Notice Holder, as the case may be, entitled thereto, on
or prior to the applicable Damages Payment Date, sums sufficient to pay the
Liquidated Damages accrued or accruing since the last preceding Damages Payment
Date through such Damages Payment Date. The Liquidated Damages shall be paid by
the Company (or the Issuer, as the case may be) to the Record Holders on each
Damages Payment Date by wire transfer of immediately available funds to the
accounts specified by them or by mailing checks to their registered addresses as
they appear in the Note register (as defined in the Indenture), in the case of
the Notes, and in the register of the Company for the Common Stock, in the case
of the Common Stock, if no such accounts have been specified on or before the
Damage Payment Date; provided, however, that any Liquidated Damages accrued with
respect to any Note or portion thereof called for redemption on a redemption
date, redeemed or repurchased in connection with a Fundamental Change (as
defined in the Indenture) on a repurchase date, or converted into Common Stock
on a conversion date prior to the Damages Payment Date, shall, in any such
event, be paid instead to the holder who submitted such Note or portion thereof
for redemption, repurchase or conversion on the applicable redemption date,
repurchase date or conversion date, as the case may be, on such date (or
promptly following the conversion date, in the case of conversion of a Note).
The Trustee shall be entitled, on behalf of the holders of Notes, Common Stock
and Notice Holder, to seek any available remedy for the enforcement of this
Agreement, including for the payment of such Liquidated Damages. Notwithstanding
the foregoing, the parties agree that the sole damages payable for a violation
of the terms of this Agreement with respect to which Liquidated Damages are
expressly provided shall be such Liquidated Damages. Nothing shall preclude a
Notice Holder or holder of Registrable Securities from pursuing or obtaining
specific performance or other equitable relief with respect to this Agreement.
All of the Company's obligations set forth in this Section 2(e) which
are outstanding with respect to any Registrable Securities at the time such
security ceases to be a Registrable Security shall survive until such time as
all such obligations with respect to such security have been satisfied in full
(notwithstanding termination of the Agreement pursuant to Section 8(o)).
The parties hereto agree that the Liquidated Damages provided for in
this Section 2(e) constitute a reasonable estimate of the damages that may be
incurred by holders of Registrable Securities (other than the Initial
Purchasers) by reason of the failure of the Shelf Registration to be filed or
declared effective or unavailable (absolutely or as a practical matter) for
effecting resales of Registrable Securities, as the case may be, in accordance
with the provisions hereof.
6. Registration Procedures. In connection with the Company's
registration obligations under Section 2 hereof, the Company shall effect such
registrations to permit the sale of the Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement or
Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof, and use
its reasonable efforts to cause each such Registration Statement to become
effective and remain effective as provided herein; provided, that before filing
any such Registration Statement or Prospectus or any amendments or supplements
thereto (other than documents that would be incorporated or deemed to be
incorporated therein by reference and that the Company is required by applicable
securities laws or stock exchange requirements to file) the Company shall
furnish to the Manager, the Special Counsel and the Managing Underwriters of
such offering, if any, copies of all such documents proposed to be filed, which
documents will be subject to the review of the Manager, the Special Counsel and
such Managing Underwriters, and the Company shall not file any such Registration
Statement or amendment thereto or any Prospectus or any supplement thereto
(other than such documents which, upon filing, would be incorporated or deemed
to be incorporated by reference therein and that the Company is required by
applicable securities laws or stock exchange requirements to file) to which
<PAGE> 8
the Holders of a majority of the Registrable Securities covered by such
Registration Statement, the Initial Purchasers or the Special Counsel shall
reasonably object in writing within two full Business Days.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be necessary to
keep such Registration Statement continuously effective for the applicable
period specified in Section 2; cause the related Prospectus to be supplemented
by any required Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act; and comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the intended methods
of disposition by the sellers thereof set forth in such Registration Statement
as so amended or such Prospectus as so supplemented.
(c) Notify the Notice Holders, the Manager, the Special
Counsel and the Managing Underwriters, if any, promptly, and (if requested by
any such person) confirm such notice in writing, (i) when a Prospectus, any
Prospectus supplement, a Registration Statement or a post-effective amendment to
a Registration Statement has been filed with the SEC, and, with respect to a
Registration Statement or any post-effective amendment, when the same has become
effective, (ii) of any request by the SEC or any other federal or state
governmental authority for amendments or supplements to a Registration Statement
or related Prospectus or for additional information, (iii) of the issuance by
the SEC or any other federal or state governmental authority of any stop order
suspending the effectiveness of a Registration Statement or the initiation or
threatening of any proceedings for that purpose, (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or Prospectus in order that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, and (vi) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
(d) Use its reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement, or the lifting
of any suspension of the qualification (or exemption from qualification) of any
of the Registrable Securities for sale in any jurisdiction, at the earliest
possible moment.
(e) If reasonably requested by the Manager or the Managing
Underwriters, if any, or the Holders of a majority of the Registrable Securities
being sold, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment to a Registration Statement such information as the
Manager, the Special Counsel, the Managing Underwriters, if any, or such
Holders, in connection with any offering of Registrable Securities, agree should
be included therein as required by applicable law, and (ii) make all required
filings of such Prospectus supplement or such post-effective amendment as soon
as practicable after the Company has received notification of the matters to be
incorporated in such Prospectus supplement or post-effective amendment;
provided, that the Company shall not be required to take any actions under this
Section 3(e) that are not, in the reasonable opinion of counsel for the Company,
in compliance with applicable law.
<PAGE> 9
(f) Furnish to each selling Holder (if so requested), the
Special Counsel and the Manager, and each Managing Underwriter, if any, without
charge, at least one conformed copy of the Registration Statement or Statements
and any amendment thereto, including financial statements but excluding
schedules, all documents incorporated or deemed to be incorporated therein by
reference and all exhibits (unless requested in writing by such selling Holder,
counsel, the Manager or underwriter).
(g) Deliver to each selling Holder, the Special Counsel and
the Manager and each Managing Underwriter, if any, in connection with any
offering of Registrable Securities, without charge, as many copies of the
Prospectus or Prospectuses relating to such Registrable Securities (including
each preliminary prospectus) and any amendment or supplement thereto as such
persons may reasonably request; and the Company hereby consents to the use of
such Prospectus or each amendment or supplement thereto by each of the selling
Holders of Registrable Securities and the Underwriters, if any, in connection
with any offering and sale of the Registrable Securities covered by such
Prospectus or any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities, to
register or qualify or cooperate with the selling Holders, the Managing
Underwriters, if any, and the Special Counsel in connection with the
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any selling Holder or Managing Underwriter reasonably requests in writing; keep
each such registration or qualification (or exemption therefrom) effective
during the period such Registration Statement is required to be kept effective
and do any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Registrable Securities covered by the
applicable Registration Statement; provided, that the Company will not be
required to (i) qualify generally to do business in any jurisdiction where it is
not then so qualified or (ii) take any action that would subject it to general
service of process in suits or to taxation in any such jurisdiction where it is
not then so subject.
(i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies or authorities within the United States, except as may be
required solely as a consequence of the nature of such selling Holder, in which
case the Company will cooperate in all reasonable respects with the filing of
such Registration Statement and the granting of such approvals, as may be
necessary to enable the selling Holder or Holders thereof or the Managing
Underwriters, if any, to consummate the disposition of such Registrable
Securities.
(j) During any Selling Period (other than during a Deferral
Period), immediately upon the existence of any fact or the occurrence of any
event as a result of which a Registration Statement shall contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, or a
Prospectus shall contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, promptly prepare and file a post-effective amendment to
each Registration Statement or a supplement to the related Prospectus or any
document incorporated therein by reference or file any other required document
(such as a Current Report on Form 8-K) that would be incorporated by reference
into the Registration Statement so that the Registration Statement shall not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading, and so that the Prospectus will not contain any untrue statement
of a material fact or omit to state any material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, as thereafter delivered to the purchasers of the Registrable
Securities being sold thereunder, and, in the case of a post-effective amendment
to a Registration Statement, use its reasonable efforts to cause it to become
effective as soon as practicable.
<PAGE> 10
(k) In the event of an Underwritten Offering, enter into such
agreements and take all such other actions in connection therewith (including
those reasonably requested by the Managing Underwriters, if any, or the Holders
of a majority of the Registrable Securities being sold) in order to expedite or
facilitate the disposition of such Registrable Securities and in such
connection, whether or not an underwriting agreement is entered into, and if the
registration is an underwritten registration, (i) make such representations and
warranties, subject to the Company's ability to do so, to the Holders of such
Registrable Securities and the underwriters with respect to the business of the
Company and its subsidiaries, the Registration Statement, Prospectus and
documents incorporated by reference or deemed incorporated by reference, if any,
in each case, in form, substance and scope as are customarily made by issuers to
underwriters in underwritten offerings and confirm the same if and when
requested; (ii) use its reasonable efforts to obtain opinions of counsel to the
Company and updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the Managing Underwriters, if
any, Special Counsel and the Holders of a majority of the Registrable Securities
being sold) addressed to each of the underwriters covering the matters
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Special Counsel and
Managing Underwriters; (iii) use its reasonable efforts to obtain "cold comfort"
letters and updates thereof from the independent certified public accountants of
the Company (and, if necessary, any other certified public accountants of any
subsidiary of the Company or any business acquired or to be acquired by the
Company for which financial statements and financial data are, or are required
to be, included in the Registration Statement), addressed to each of the
Managing Underwriters, if any, such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters in connection
with Underwritten Offerings; and (iv) deliver such documents and certificates as
may be reasonably requested by the Holders of a majority of the Registrable
Securities being sold, the Special Counsel and the Managing Underwriters, if
any, to evidence the continued validity of the representations and warranties of
the Company and its subsidiaries made pursuant to clause (i) above and to
evidence compliance with any customary conditions contained in the underwriting
agreement or other agreement entered into by the Company. The above shall be
done at each closing under such underwriting or similar agreement as and to the
extent required thereunder.
(l) If requested in connection with a disposition of
Registrable Securities pursuant to a Registration Statement, make available for
inspection by a representative of the Holders of Registrable Securities being
sold, any Managing Underwriter participating in any disposition of Registrable
Securities, if any, and any attorney or accountant retained by such selling
holders or underwriter, financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries, and cause the
executive officers, directors and employees of the Company and its subsidiaries
to supply all information reasonably requested by any such representative,
Managing Underwriter, attorney or accountant in connection with such
disposition; subject to reasonable assurances by each such person that such
information will only be used in connection with matters relating to such
Registration Statement, provided, however, that such persons shall first agree
in writing with the Company that any information that is reasonably and in good
faith designated by the Company in writing as confidential at the time of
delivery of such information shall be kept confidential by such persons, unless
(i) disclosure of such information is required by court or administrative order
or is necessary to respond to inquiries of regulatory authorities, (ii)
disclosure of such information is required by law (including any disclosure
requirements pursuant to Federal securities laws in connection with the filing
of any Registration Statement or the use of any prospectus referred to in this
Agreement), (iii) such information becomes generally available to the public
other than as a result of a disclosure or failure to safeguard by any such
person or (iv) such information becomes available to any such person from a
source other than the Company and such source is not bound by a confidentiality
agreement.
(m) Comply with all applicable rules and regulations of the
SEC and make generally available to its securityholders earning statements
(which need not be audited) satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder (or any similar rule promulgated under
the
<PAGE> 11
Securities Act) no later than 45 days after the end of any 12-month period (or
90 days after the end of any 12-month period if such period is a fiscal year)
(i) commencing at the end of any fiscal quarter in which Registrable Securities
are sold to underwriters in a firm commitment or best efforts underwritten
offering and (ii) if not sold to underwriters in such an offering, commencing on
the first day of the first fiscal quarter of the Company commencing after the
effective date of a Registration Statement, which statements shall cover said
12-month periods.
(n) Cooperate with the selling holders of Registrable
Securities to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing any restrictive
legends; and enable such Registrable Securities to be in such denominations and
registered in such names as the holders may request.
(o) Provide the transfer agent for the Common Stock with
printed certificates for the Registrable Securities which are in a form eligible
for deposit with The Depository Trust Company.
(p) Cause all Registrable Securities covered by the
Registration Statement to be listed on each securities exchange or quotation
system on which the Company's Common Stock is then listed no later than the date
the Registration Statement is declared effective and, in connection therewith,
to the extent applicable, to make such filings under the Exchange Act (e.g., the
filing of a Registration Statement on Form 8-A) and to have such filings
declared effective thereunder.
(q) Cooperate and assist in any filings required to be made
with the National Association of Securities Dealers, Inc.
(r) Notwithstanding any provision of this Agreement to the
contrary, the Company shall not be required to amend or supplement the Shelf
Registration pursuant to the Agreement if (i) such amendment or supplement would
require the Company to disclose a material financing, acquisition or corporate
transaction and the Company shall have determined that such disclosure is not in
the best interests of the Company and the holders of its outstanding Common
Stock or (ii) the Company shall have determined in good faith that there is a
valid business purpose or reason for suspending the use of the Prospectus
included in such Shelf Registration in accordance herewith instead of making
such amendment or supplement; provided, that in each such case the Company
complies with its obligations, if any, to pay Liquidated Damages.
7. Holder's Obligations. Each Holder agrees, by acquisition of the
Notes and Registrable Securities, that no Holder of Registrable Securities shall
be entitled to sell any of such Registrable Securities pursuant to a
Registration Statement or to receive a Prospectus relating thereto, unless such
Holder has furnished the Company with the notice required pursuant to Section
2(d) hereof and such other information regarding such Holder and the
distribution of such Registrable Securities as may be required to be included in
the Registration Statement or the Prospectus or as the Company may from time to
time reasonably request. The Company may exclude from such registration the
Registrable Securities of any Holder who does not furnish such information
provided above for so long as such information is not so furnished. Each Holder
of Registrable Securities as to which any Registration Statement is being
effected agrees promptly to furnish to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not misleading. Any sale of any Registrable Securities by
any Holder shall constitute a representation and warranty by such Holder that
the information relating to such Holder and its plan of distribution is as set
forth in the Prospectus delivered by such Holder in connection with such
disposition, that such Prospectus does not as of the time of such sale contain
any untrue statement of a material fact relating to such Holder or its plan of
distribution and that such Prospectus does not as of the time of such sale omit
to state any material fact relating to such Holder or its plan of distribution
necessary to make the statements in such Prospectus, in light of the
circumstances under which they were made, not misleading.
<PAGE> 12
8. Registration Expenses. All fees and expenses incident to the
Company's performance of or compliance with this Agreement shall be borne by the
Company whether or not any of the Registration Statements become effective. Such
fees and expenses shall include, without limitation, (i) all registration and
filing fees (including, without limitation, fees and expenses (x) with respect
to filings required to be made with the National Association of Securities
Dealers, Inc. and (y) of compliance with federal securities or Blue Sky laws
(including, without limitation, fees and disbursements of Special Counsel in
connection with Blue Sky qualifications of the Registrable Securities in such
jurisdictions as the Managing Underwriters, if any, or Holders of a majority of
the Registrable Securities being sold may designate)), (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities in a form eligible for deposit with The Depository Trust
Company and of printing prospectuses if the printing of prospectuses is
requested by the Special Counsel or the holders of a majority of the Registrable
Securities included in any Registration Statement), (iii) messenger, telephone
and delivery expenses, (iv) reasonable fees and disbursements of counsel for the
Company and the Special Counsel (not to exceed $5,000) in connection with the
Shelf Registration (provided that the Company shall not be liable for the fees
and expenses of more than one separate firm for all parties participating in any
transaction hereunder), (v) fees and disbursements of all independent certified
public accountants referred to in Section 3(k)(iii) hereof (including the
expenses of any special audit and "cold comfort" letters required by or incident
to such performance) and (vi) Securities Act liability insurance obtained by the
Company in its sole discretion. In addition, the Company shall pay its internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit, the fees and expenses incurred in connection with the listing
of the securities to be registered on any securities exchange on which similar
securities issued by the Company are then listed and the fees and expenses of
any person, including special experts, retained by the Company. Notwithstanding
the provisions of this Section 5, each seller of Registrable Securities shall
pay all selling expenses and all registration expenses to the extent that the
Company is prohibited by applicable Blue Sky laws from paying for or on behalf
of such seller of Registrable Securities, and the Managing Underwriters shall
pay the fees of their counsel in connection with any Underwritten Offering
(other than Blue Sky qualifications).
9. Indemnification.
(a) Indemnification by the Company. The Company shall
indemnify and hold harmless each Initial Purchaser, each Holder and each person,
if any, who controls the Initial Purchasers or any Holder (within the meaning of
either Section 15 of the Securities Act or Section 20(a) of the Exchange Act)
from and against all losses, liabilities, damages and expenses (including,
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim)
(collectively, "Losses"), caused by any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
Prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein in light of the circumstances in which they were made not misleading,
except insofar as such Losses are caused by the information relating to the
Initial Purchasers or any Holder furnished to the Company in writing by the
Initial Purchasers or such Holder expressly for use therein; provided, that the
Company shall not be liable to any Holder of Registrable Securities (or any
person controlling such Holder) to the extent that any such Losses are caused by
an untrue statement or alleged untrue statement or omission or alleged omission
made in any preliminary prospectus if either (A)(i) such Holder failed to send
or deliver a copy of the Prospectus with or prior to the delivery of written
confirmation of the sale by such Holder to the person asserting the claims from
which such Losses result and (ii) the Prospectus would have corrected such
untrue statement or alleged untrue statement or such omission or alleged
omission, or (B)(x) such untrue statement or alleged untrue statement, omission
or alleged omission is corrected in an amendment or supplement to the Prospectus
and (y) having previously been furnished by or on behalf of the Company with
copies of the Prospectus as so amended or supplemented, such holder thereafter
fails to deliver
<PAGE> 13
such Prospectus as so amended or supplemented, with or prior to the delivery of
written confirmation of the sale of a Registrable Security to the person
asserting the claim from which such Losses result. The Company shall also
indemnify each underwriter and each person who controls such person (within the
meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange
Act) to the same extent and with the same limitations as provided above with
respect to the indemnification of the Initial Purchasers or the holders of
Registrable Securities.
(b) Indemnification by Holder of Registrable Securities. Each
Holder agrees, and such agreement shall be evidenced by the Holder delivering
the notice described in Section 2(d) hereof, severally and not jointly to
indemnify and hold harmless the Initial Purchasers, the other selling Holders,
the Company, its directors, its officers who sign a Registration Statement, and
each person, if any, who controls the Company, the Initial Purchasers and any
other selling Holder (within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act), from and against all losses arising out
of or based upon any untrue statement of a material fact contained in any
Registration Statement, Prospectus or preliminary prospectus or arising out of
or based upon any omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, to the extent, but only
to the extent, that such untrue statement or omission is contained in any
information relating to such Holder so furnished in writing by such Holder to
the Company expressly for use in such Registration Statement or Prospectus. In
no event shall the liability of any selling holder of Registrable Securities
hereunder be greater in amount than the dollar amount of the proceeds received
by such holder upon the sale of the Registrable Securities giving rise to such
indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any
proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to
either of the two preceding paragraphs, such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the reasonable
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (a) the fees and expenses of more than one separate firm (in
addition to any local counsel) for the Initial Purchasers and all persons, if
any, who control the Initial Purchasers within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act, (b) the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all Holders and all persons, if any, who control any Holder within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act,
and (c) the fees and expenses of more than one separate firm (in addition to any
local counsel) for the Company, its directors, its officers who sign a
Registration Statement and each person, if any, who controls the Company within
the meaning of either such Section, and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for the
Company, and such directors, officers and control persons of the Company, such
firm shall be designated in writing by the Company. In such case involving the
Initial Purchasers and persons who control the Initial Purchasers, such firm
shall be designated in writing by Deutsche Morgan Grenfell Inc. In such case
involving the Holders and such persons who control Holders, such firm shall be
designated in writing by the holders of the majority of Registrable Securities
sold pursuant to the Registration Statement. The indemnifying party shall not be
liable
<PAGE> 14
for any settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than forty-five (45) days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this
Section 6 is unavailable to an indemnified party under Section 6(a) or 6(b)
hereof in respect of any Losses or is insufficient to hold such indemnified
party harmless, then each applicable 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 such Losses, (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying party
or parties on the one hand and the indemnified party or parties on the other
hand or (ii) if the allocation 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
the indemnifying party or parties on the one hand and of the indemnified party
or parties on the other hand in connection with the statements or omissions that
resulted in such Losses, as well as any other relevant equitable considerations.
Benefits received by the Company shall be deemed to be equal to the total net
proceeds from the initial placement (before deducting expenses) of the Notes
pursuant to the Purchase Agreement. Benefits received by the Initial Purchasers
shall be deemed to be equal to the total purchase discounts and commissions
received by it pursuant to the Purchase Agreement, and benefits received by any
other Holders shall be deemed to be equal to the value of receiving Notes
registered under the Securities Act. Benefits received by any underwriter shall
be deemed to be equal to the total underwriting discounts and commissions, as
set forth on the cover page of the Prospectus forming a part of the Registration
Statement which resulted in such Losses. The relative fault of the Holders on
the one hand and the Company on the other hand 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 the Holders or by the Company and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Holders' respective
obligations to contribute pursuant to this paragraph are several in proportion
to the respective number of Registrable Securities they have sold pursuant to a
Registration Statement, and not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method or allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Losses
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any reasonable legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding this
Section 6(d), an indemnifying party that is a selling Holder of Registrable
Securities shall not be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Securities sold by such
indemnifying party and distributed to the public were offered to the public
exceeds the amount of any damages which such indemnifying party has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty
<PAGE> 15
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 indemnity, contribution and expense reimbursement obligations of
the Company hereunder shall be in addition to any liability the Company may
otherwise have hereunder, under the Purchase Agreement or otherwise. The
provisions of this Section 6 shall survive so long as Registrable Securities
remain outstanding, notwithstanding any transfer of the Registrable Securities
by any holder or any termination of this Agreement.
The indemnity and contribution provisions contained in this Section 6
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
the Initial Purchasers, any Holder or any person controlling any Holder, or the
Company, its officers or directors or any person controlling the Company and
(iii) the sale of any Registrable Securities by any Holder.
10. Information Requirements.
(a) The Company shall file the reports required to be filed by
it under the Securities Act and the Exchange Act, and if at any time the Company
is not required to file such reports, it will, upon the request of any holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 and Rule 144A under the
Securities Act. The Company further covenants that it will cooperate with any
holder of Registrable Securities and take such further reasonable action as any
holder of Registrable Securities may reasonably request (including, without
limitation making such reasonable representations as any such holder may
reasonably request), all to the extent required from time to time to enable such
holder to sell Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by Rule 144 and Rule 144A
under the Securities Act. Upon the request of any holder of Registrable
Securities, the Company shall deliver to such holder a written statement as to
whether it has complied with such filing requirements. Notwithstanding the
foregoing, nothing in this Section 7 shall be deemed to require the Company to
register any of its securities under any section of the Exchange Act.
(b) The Company shall file the reports required to be filed by
it under the Exchange Act and shall comply with all other requirements set forth
in the instructions to Form S-3 in order to allow the Company to be eligible to
file registration statements on Form S-3.
11. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement, provided that the sole damages payable for a violation of
the terms of this Agreement for which Liquidated Damages are expressly provided
pursuant to Section 2(e) hereof shall be such Liquidated Damages. The Company
agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of any of the provisions of this Agreement
and hereby further agrees that, in the event of any action for specific
performance in respect of such breach, it shall waive the defense that a remedy
at law would be adequate.
(b) No Conflicting Agreements. The Company has not, as of the
date hereof and shall not, on or after the date of this Agreement, enter into
any agreement with respect to its securities which conflicts with the rights
granted to the holders of Registrable Securities in this Agreement. The Company
<PAGE> 16
represents and warrants that the rights granted to the holders of Registrable
Securities hereunder do not in any way conflict with the rights granted to the
holders of the Company's securities under any other agreements.
(c) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company has obtained the written consent of holders
of a majority of the then outstanding Common Stock constituting Registrable
Securities (with holders of Notes deemed to be the holders, for purposes of this
Section, of the number of outstanding shares of Common Stock into which such
Notes are convertible). Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of holders of Registrable Securities whose securities
are being sold pursuant to a Registration Statement and that does not directly
or indirectly affect the rights of other holders of Registrable Securities may
be given by holders of at least a majority of the Registrable Securities being
sold by such holders; provided, that the provisions of this sentence may not be
amended, modified, or supplemented except in accordance with the provisions of
the immediately preceding sentence.
(d) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing and shall be deemed given (i)
when made, if made by hand delivery, (ii) upon confirmation, if made by
telecopier or (iii) one business day after being deposited with a reputable
next-day courier, postage prepaid, to the parties as follows:
(w) if to a holder of Registrable Securities, at the
most current address given by such holder to the Company in
accordance with the provisions of Section 8(e);
(x) if to the Company, to:
Atmel Corporation
2325 Orchard Parkway
San Jose, California 95131
Attention: General Counsel
Telecopy No.: (408) 436-4380
with a copy to:
Wilson Sonsini Goodrich & Rosati, P.C.
650 Page Mill Road
Palo Alto, California 94304-1050
Attention: Mark A. Bertelsen, Esq.
Telecopy No.: (415) 493-6811
(y) if to the Special Counsel to:
Venture Law Group
A Professional Corporation
2800 Sand Hill Road
Menlo Park, CA 94025
Attention: Don Keller, Esq.
Telecopy No.: (415) 854-1121
and
<PAGE> 17
(z) if to the Manager to:
Deutsche Morgan Grenfell Inc.
31 West 52nd Street
New York, NY 10019
Attention: Thomas Curtis, Esq.
Telecopy No.: (212) 469-8560
or to such other address as such person may have furnished to the other persons
identified in this Section 8(d) in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will
maintain, or will cause its registrar and transfer agent to maintain, a register
with respect to the Registrable Securities in which all transfers of Registrable
Securities of which the Company has received notice will be recorded. The
Company may deem and treat the person in whose name Registrable Securities are
registered in such register of the Company as the owner thereof for all
purposes, including, without limitation, the giving of notices under this
Agreement.
(f) Approval of Holders. Whenever the consent or approval of
holders of a specified percentage of Registrable Securities is required
hereunder, Registrable Securities held by the Company or its affiliates (as such
term is defined in Rule 405 under the Securities Act) (other than the Initial
Purchasers or subsequent holders of Registrable Securities if such subsequent
holders are deemed to be such affiliates solely by reason of their holdings of
such Registrable Securities) shall not be counted in determining whether such
consent or approval was given by the holders of such required percentage.
(g) Successors and Assigns. Any person who purchases any
Registerable Securities from an Initial Purchaser shall be deemed, for purposes
of this Agreement, to be an assignee of such Initial Purchaser. The Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
each of the parties and shall inure to the benefit of and be binding upon each
holder of any Registrable Securities.
(h) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be original and all of which taken
together shall constitute one and the same agreement.
(i) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.
(k) Severability. If any term, provision, covenant or
restriction of this Agreement is held to be invalid, illegal, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated thereby, and the parties hereto
shall use their best efforts to find and employ an alternative means to achieve
the same or substantially the same result as that contemplated by such term,
provision, covenant or restriction. It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such which may
be hereafter declared invalid, illegal void or unenforceable.
<PAGE> 18
(l) Entire Agreement This Agreement is intended by the parties
as a final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and the registration rights
granted by the Company with respect to the Common Stock of the Company into
which Notes are convertible sold pursuant to the Purchase Agreement. Except as
provided in the Purchase Agreement, there are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein,
with respect to the registration rights granted by the Company with respect to
the Common Stock of the Company to which the Notes are convertible. This
Agreement supersedes all prior agreements and understandings among the parties
with respect to such registration rights.
(m) Attorneys' Fees. In any action or proceeding brought to
enforce provision of this Agreement, or where any provision hereof is validly
asserted as a defense, the prevailing party, as determined by the court, shall
be entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(n) Further Assurances. Each of the parties hereto shall use
all reasonable efforts to take, or cause to be taken, all appropriate action, do
or cause to be done all things reasonably necessary, proper or advisable under
applicable law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and the other
documents contemplated hereby and consummate and make effective the transactions
contemplated hereby.
(o) Termination. This Agreement and the obligations of the
parties hereunder shall terminate upon the end of the Effectiveness Period,
except for any liabilities or obligations under Sections 4, 5 or 6 hereof and
the obligations to make payments of and provide for Liquidated Damages under
Section 2(e) hereof to the extent such damages accrue prior to the end of the
Effectiveness Period, each which shall remain in effect in accordance with their
terms.
<PAGE> 19
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
ATMEL CORPORATION
By: /s/ KRIS CHELLAM
--------------------------------
Name: Kris Chellam
Title: Vice President, Finance and
Administration and
Chief Financial Officer
Accepted as of the date first above written:
By: DEUTSCHE MORGAN GRENFELL INC.
Acting severally on behalf of itself and the
several Initial Purchasers named in the first
paragraph of the Agreement
By: /s/ JOHN HODGE
---------------------------
Name: John Hodge
Title: Managing Director
<PAGE> 1
EXHIBIT 5.1
August 15, 1997
Atmel Corporation
2325 Orchard Parkway
San Jose, CA 95131
RE: REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-3 to be filed
with the Securities and Exchange Commission (the "Registration Statement"), in
connection with the registration under the Securities Act of 1933, as amended,
of 4,225,352 shares of Common Stock, no par value, of Atmel Corporation (the
"Shares"). The Shares are issuable upon conversion of the Company's 3.25%
Convertible Subordinated Guaranteed Step-Up Notes due 2002 (the "Notes"). As
your counsel, we have examined the proceedings proposed to be taken in
connection with the issuance of the Shares upon the conversion of the Notes.
It is our opinion that, upon completion of the proceedings being taken
or contemplated by us, as your counsel, to be taken prior to the issuance of the
Shares upon due and proper conversion of the Notes in accordance with their
terms, 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 referred to in the Registration Statement, will be legally and validly
issued, fully paid and non-assessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement, including the Prospectus constituting a part thereof,
and any amendment thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement on
Form S-3, and related Prospectus of Atmel Corporation of our reports dated
January 16, 1997, on our audits of the consolidated financial statements and
financial statement schedules of Atmel Corporation as of December 31, 1996 and
1995 and for each of the three years in the period ended December 31, 1996,
incorporated by reference in its Annual Report on Form 10-K for the year ended
December 31, 1996 filed with the Securities and Exchange Commission. We also
consent to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
San Jose, California
August 15, 1997
