EXHIBIT 99.5
STOCKHOLDERS' AGREEMENT
This AGREEMENT is made as of this 4th day of August, 1999, by and among
SCG Holding Corporation, a Delaware corporation (the "COMPANY") and each of the
following (hereinafter severally referred to as a "STOCKHOLDER" and collectively
referred to as the "STOCKHOLDERS"): TPG Semiconductor Holdings LLC, a Delaware
limited liability company ("TPG HOLDINGS"), Motorola, Inc., a Delaware
corporation ("MOTOROLA"), and each additional person who becomes a party to this
Agreement pursuant to Article V hereof as a stockholder of the Company.
WHEREAS, TPG Holdings, Motorola and the Company have heretofore entered
into an Agreement and Plan of Recapitalization and Merger, dated as of May 11,
1999, as amended (the "RECAPITALIZATION AGREEMENT"), which provides for, among
other things, the recapitalization of the Company and the issuance of shares of
capital stock of the Company to TPG Holdings on the terms and subject to the
conditions set forth in the Recapitalization Agreement (the "RECAPITALIZATION");
WHEREAS, the Stockholders will acquire or hold all of the issued and
outstanding shares of common stock, $0.01 par value, of the Company (such
shares, together with any additional shares of common stock issued by the
Company, being hereinafter severally referred to as a "COMMON SHARE" and
collectively referred to as the "COMMON SHARES," and, together with the shares
of Series A Cumulative Preferred Stock, $0.01 par value, of the Company (the
"PREFERRED SHARES"), being hereinafter severally referred to as a "SHARE" and
collectively referred to as the "SHARES"); and
WHEREAS, the parties hereto desire to enter into an agreement regarding
certain matters described herein, including the imposition of certain
restrictions on the transferability of the Shares.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties mutually agree as follows:
ARTICLE I
REPRESENTATIONS AND WARRANTIES
Each of the parties hereby severally represents and warrants to each of
the other parties as follows:
1.1 AUTHORITY; ENFORCEABILITY. Such party has the legal capacity or
corporate power and authority to enter into this Agreement and to carry out its
obligations hereunder. Such party is duly organized and validly existing under
the laws of its jurisdiction of organization, and the execution of this
Agreement and the consummation of the transactions contemplated herein have been
duly authorized by all necessary action. No other act or proceeding, corporate
or otherwise, on its part is necessary to authorize the execution of this
Agreement or the consummation of any of the transactions contemplated hereby.
This Agreement has been duly
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executed by such party and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with the terms of this Agreement, subject
to applicable bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the rights of creditors generally and to the exercise of judicial
discretion in accordance with general principles of equity (whether applied by a
court of law or of equity).
1.2 NO BREACH. Neither the execution of this Agreement nor the
performance by such party of its obligations hereunder nor the consummation of
the transactions contemplated hereby does or will:
(a) conflict with or violate its certificate of incorporation, bylaws
or other organizational documents;
(b) violate, conflict with or result in the breach or termination of,
or otherwise give any other person the right to accelerate, re-negotiate or
terminate or receive any payment, or constitute a default or an event of default
(or an event which with notice, lapse of time, or both, would constitute a
default or event of default) under the terms of, any contract or agreement to
which it is a party or by which it or any of its assets or operations are bound
or affected; or
(c) constitute a violation by such party of any laws, rules or
regulations of any governmental, administrative or regulatory authority or any
judgments, orders, rulings or awards of any court, arbitrator or other judicial
authority or any governmental, administrative or regulatory authority.
1.3 CONSENTS. No consent, waiver, approval, authorization, exemption,
registration, license or declaration is required to be made or obtained by such
party, other than those which have been made or obtained, in connection with (i)
the execution or enforceability of this Agreement or (ii) the consummation of
any of the transactions contemplated hereby.
1.4 SHARE OWNERSHIP. (a) Such party will own, immediately following the
consummation of the transactions contemplated by the Recapitalization Agreement,
the number of Shares of each class set forth opposite such party's name in
Schedule 1.4 attached hereto, free and clear of any and all liens, claims and
encumbrances, other than those created by this Agreement.
(b) The Company represents and warrants that, as of the date hereof,
(i) the authorized capital stock of the Company consists of (A) 1,000,000 Common
Shares, of which 100,000 Common Shares are issued and outstanding, and (B)
100,000 shares of preferred stock, of which 2,090 Preferred Shares are issued
and outstanding.
ARTICLE II
TRANSFER OF SHARES
2.1 RESTRICTIONS ON TRANSFERS.
(a) No Stockholder may transfer by way of sale, exchange, assignment,
pledge, gift or other disposition (all of which acts shall be deemed included in
the term "TRANSFER"
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as used in this Agreement) any or all of the Shares (whether held in its, his or
her own right or by a representative of the Stockholder) (each Stockholder,
other than TPG Holdings or any of its affiliates (each a "TPG HOLDER"), is
hereinafter referred to as a "TRANSFEROR") unless (i) such transfer of Shares is
made on the books of the Company and in accordance with the provisions of
Article II of this Agreement and (ii) the transferee of such Shares (if other
than (A) the Company or another Stockholder, (B) a transferee in a sale of
Shares made under Rule 144 (or any successor provision) under the Securities Act
of 1933, as amended (the "SECURITIES ACT"), or (C) a transferee of Shares
registered under the Securities Act agrees to become a party to this Agreement
pursuant to Article V hereof and executes such further documents as may be
necessary, in the opinion of the Company, to make him, her or it a party hereto.
(b) Any purported transfer of Shares other than in accordance with this
Agreement by any Transferor shall be null and void, and the Company shall refuse
to recognize any such transfer for any purpose and shall not reflect in its
records any change in record ownership of Shares pursuant to any such transfer.
(c) The Company shall not issue any Shares upon original issue or
reissue or otherwise dispose of any Shares unless the recipient or transferee of
such Shares (if other than a Stockholder) shall agree to become a party to this
Agreement pursuant to Article V hereof and executes such further documents as
may be necessary, in the opinion of the Company, to make him, her or it a party
hereto.
2.2 RIGHT OF FIRST OFFER.
(a) In the event that a Transferor desires to sell or transfer all or
part of its Common Shares ("OFFERED COMMON SHARES") or Preferred Shares (the
"OFFERED PREFERRED SHARES" and, together with the Offered Common Shares,
"OFFERED SHARES"), other than pursuant to Section 2.3, 2.4 or 2.5 of this
Agreement or in a public offering or in a brokerage transaction through the
public securities markets, the Transferor shall give prompt written notice (a
"TRANSFEROR'S NOTICE") of its desire to sell the Offered Shares to the Company
and TPG Holdings, which notice shall identify (i) the number of Offered Common
Shares, (ii) the number of Offered Preferred Shares and (iii) any other material
items and conditions of the proposed transfer (including the purchase price).
The date on which such Transferor's Notice is actually received by the Company
and TPG Holdings is referred to hereinafter as the "NOTICE DATE."
(b) The TPG Holders shall have fifteen (15) days following the Notice
Date to notify the Transferor and the Company in writing of an offer to purchase
in cash (the "OFFER TO PURCHASE") all (but not less than all) of the Offered
Shares by one or more of the TPG Holders (the "ELECTING HOLDERS") at the
purchase price and upon the other terms and conditions specified in the
Transferor's Notice, including without limitation the proposed closing date for
the purchase and any other material term or condition of the proposed purchase.
If the Transferor does not receive a written notice from any of the TPG Holders
containing a cash offer to purchase the Offered Shares within the fifteen (15)
day period, the TPG Holders shall be deemed to have declined to purchase such
Offered Shares and the Transferor may, subject to compliance with the provisions
of Section 2.1(a) and Section 2.2(e), thereafter transfer to any purchaser at
any time within 120 days following the Notice Date all (but not less than all)
of the Offered Shares at a price which is not less than the purchase price
specified in the Transferor's Notice
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and upon substantially the same terms and conditions set forth in the
Transferor's Notice; PROVIDED that if TPG Holdings notifies the Transferor in
writing, within fifteen (15) days following receipt of the notice required by
Section 2.2(e), of an objection to the purchaser because the purchaser or one or
more of its affiliates is engaged in the semiconductor business, the Transferor
shall not have the right to transfer any of the Offered Common Shares to such
purchaser (but shall be permitted to transfer the Offered Preferred Shares); and
PROVIDED FURTHER that if the Offered Common Shares are not transferred to a
purchaser for any reason within 120 days following the Notice Date, then such
Offered Common Shares may be transferred only by again complying with all of the
terms and procedures set forth in this Article II.
(c) The Transferor shall have fifteen (15) days following receipt of
the Offer to Purchase to accept the offer made by the Electing Holders to
purchase all (but not less than all) of the Offered Shares on the terms and
subject to the conditions set forth in the Offer to Purchase. If, in accordance
with the terms of the preceding sentence, the Transferor accepts the offer made
by the Electing Holders to purchase all (but not less than all) of the Offered
Shares on the terms and subject to the conditions set forth in the Offer to
Purchase, the closing for such transaction shall take place at a time and place
reasonably acceptable to the Transferor and the Electing Holders; PROVIDED that
such closing shall not occur more than thirty (30) days after the date on which
the Electing Holders actually receive notice that their Offer to Purchase has
been accepted by the Transferor. At such closing, the Electing Holders shall
deliver to the Transferor the consideration to be exchanged for such Offered
Shares, in immediately available funds, and the Transferor shall deliver to the
Electing Holders all documents required to effect the sale of such Offered
Shares, duly endorsed and free of any liens, including appropriate documentation
providing indemnities to the Electing Holders regarding its title to such
Offered Shares and such other matters as are customary for such transactions.
(d) If, within fifteen (15) days following receipt of the Offer to
Purchase, the Transferor rejects or does not accept the Offer to Purchase made
by the Electing Holders, such Transferor may, subject to compliance with the
provisions of Section 2.1(a) and Section 2.2(e), thereafter sell all (but not
less than all) of the Offered Shares to any purchaser upon substantially the
same terms and conditions as are specified in the Transferor's Notice at any
time within 120 days following the Notice Date; PROVIDED that (i) the purchase
price for such Offered Shares in any such transaction is in cash and is not less
than the proposed cash purchase price offered by the Electing Holders for such
Offered Shares and (ii) if TPG Holdings notifies the Transferor in writing,
within ten (10) days following receipt of the notice required by Section 2.2(e),
of an objection to the purchaser because the purchaser or one or more of its
affiliates is engaged in the semiconductor business, the Transferor shall not
have the right to transfer any of the Offered Shares to such purchaser; and
PROVIDED FURTHER that if the Offered Shares are not transferred to a purchaser
for any reason within 120 days following the Notice Date, then such Offered
Common Shares may be transferred only by again complying with all of the terms
and procedures set forth in this Article II.
(e) As soon as practicable, but in any event no less than fifteen (15)
days prior to the consummation of a proposed sale of Offered Shares to a
purchaser pursuant to Section 2.2(d), the Transferor shall give written notice
to the Company and TPG Holdings, which notice shall specify with respect to each
such proposed sale (i) the identity of the purchaser, (ii) the cash
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purchase price to be paid by such purchaser for the Offered Shares, (iii) the
date of the proposed transfer and (iv) any other material items and conditions
of the proposed sale.
2.3 TRANSFERS TO PERMITTED TRANSFEREES. A Stockholder may transfer any
or all of the Shares held by such Stockholder to a Permitted Transferee (as
hereinafter defined) of such Stockholder without complying with any other
provision of this Article II other than Section 2.1. For purposes of this
Agreement, a "PERMITTED TRANSFEREE" means (a) in the case of any Stockholder
that is not a corporation or individual, any general or limited partner, member,
managing director, officer, employee or affiliate (as defined in Rule 12b-2
under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) of
such Stockholder, (b) in the case of any Stockholder that is a corporation, any
other entity that owns, directly or indirectly, at least 51% of the equity
securities of such Stockholder ("MAJORITY OWNERSHIP") or that is under common
majority ownership with such Stockholder, (c) in the case of any Stockholder
that is an individual, any successor by death or divorce or (d) in the case of
any Stockholder that is a trust whose sole beneficiaries are individuals, such
individuals or their spouses or lineal descendants.
2.4 BANKRUPTCY OF A STOCKHOLDER.
(a) Upon the bankruptcy (as hereinafter defined in Section 2.4(d)
below) of a Stockholder (a "BANKRUPT STOCKHOLDER"), the TPG Holders may, by
written notice given to the Bankrupt Stockholder, the other Stockholders and the
Company within 30 days following the occurrence of the event specified in
Section 2.4(d) which gives rise to such bankruptcy, elect to purchase for cash
part or all of such Bankrupt Stockholder's shares (the "BANKRUPT SHARES") at a
price equal to the fair market value of such shares at the time of purchase, as
determined by an independent appraiser to be selected by the Company and
reasonably satisfactory to the Bankrupt Stockholder. Fees and expenses of any
independent appraiser selected pursuant to this subsection shall be shared
equally by the Bankrupt Stockholder and the TPG Holders.
(b) If the TPG Holders elect to acquire fewer than all of the Bankrupt
Shares within 30 days after the event giving rise to such bankruptcy, the
Company shall thereupon have the option, exercisable by written notice given to
the Bankrupt Stockholder and the other Stockholders within 45 days after the
event giving rise to such bankruptcy, to purchase for cash all or part of the
remaining Bankrupt Shares at the price determined in accordance with Section
2.4(a) above.
(c) Upon the giving of the notices provided in Sections 2.4(a) and (b)
above, the TPG Holders and/or the Company, as the case may be, shall be
obligated severally, but not jointly, to purchase, and the Bankrupt Stockholder
shall be obligated to sell to each of them, the respective numbers of such
Bankrupt Shares specified in such notices (or determined in accordance with
Section 2.4(a) above, as the case may be) for cash at the price determined in
accordance with Section 2.4(a) above.
(d) The bankruptcy of a Stockholder shall be deemed to occur upon the
occurrence of any of the following events:
(i) The filing of a voluntary petition in bankruptcy by such
Stockholder;
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(ii) The filing of an involuntary petition in bankruptcy with respect
to such Stockholder which remains undismissed for a period of 90 days;
(iii) The appointment of a receiver with respect to such Stockholder or
with respect to all or substantially all of his, her or its assets or affairs
which remains undismissed for a period of 60 days; or
(iv) The admission in writing by the Stockholder of his, her or its
inability to pay his, her or its debts generally as they become due.
2.5 CERTAIN RIGHTS.
(a) DRAG ALONG RIGHTS. If the TPG Holders desire to sell all or
substantially all of their Common Shares to a purchaser (other than pursuant to
Section 2.3) and said purchaser desires to acquire all or substantially all of
the issued and outstanding Common Shares (or all or substantially all of the
assets of the Company) upon such terms and conditions as agreed to with the TPG
Holders, each other Stockholder agrees to sell all of its Common Shares to said
purchaser (or to vote such Common Shares in favor of any merger or other
transaction which would effect a sale of such Common Shares (or all or
substantially all of the assets of the Company) and to waive its appraisal or
dissenters' rights with respect to such transaction, at the same price per
Common Share and pursuant to the same terms and conditions with respect to
payment for the Common Shares as agreed to by the TPG Holders. In such case, the
TPG Holders shall give written notice of such sale to the other Stockholders at
least 30 days prior to the consummation of such sale, setting forth (i) the
consideration to be received by the Stockholders, (ii) the identity of the
purchaser, (iii) any other material items and conditions of the proposed
transfer and (iv) the date of the proposed transfer.
(b) TAG ALONG RIGHTS. (i) Subject to paragraph (v) of this Section
2.5(b), if a TPG Holder proposes to transfer any Common Shares or Preferred
Shares to a purchaser other than a Permitted Transferee of such TPG Holder,
except in a public offering or in a brokerage transaction through the public
securities markets, such TPG Holder (hereinafter referred to as a "SELLING TPG
STOCKHOLDER") shall give written notice (a "TRANSFER NOTICE") of such proposed
transfer to the Stockholders other than the TPG Holders (the "OTHER
STOCKHOLDERS") at least 30 days prior to the consummation of such proposed
transfer, setting forth for each class of Shares (A) the number of Shares
offered, if any, (B) the consideration to be received for such Shares by such
Selling TPG Stockholder, (C) the identity of the purchaser, (D) any other
material items and conditions of the proposed transfer, (E) the date of the
proposed transfer and (F) that each such Other Stockholder shall have the right
to elect to sell up to its Pro Rata Portion (as defined in Section 2.5(b)(iii)
below) of such Shares.
(ii) Subject to paragraph (iv) of this Section 2.5(b), upon delivery of
a Transfer Notice, each Other Stockholder may elect to sell up to the Pro Rata
Portion of its Shares of the same class and series proposed to be sold by the
Selling TPG Stockholder, at the same price per Share of the same class and
pursuant to the same terms and conditions with respect to payment for the Shares
of the same class and series as agreed to by the Selling TPG Stockholder, by
sending written notice to the Selling TPG Stockholder within 15 days of the date
of the Transfer Notice, indicating its election to sell up to the Pro Rata
Portion of its Shares of the same class in
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the same transaction. Following such 15 day period, each of the Selling TPG
Stockholder and each Other Stockholder, concurrently with the Selling TPG
Stockholder, shall be permitted to sell to the purchaser on the terms and
conditions set forth in the Transfer Notice the Pro Rata Portion of its Shares.
(iii) For purposes of this Agreement, "PRO RATA PORTION" shall mean,
with respect to Common Shares or Preferred Shares, as the case may be, held by a
Stockholder, a number equal to the product of (A) the total number of such
shares then owned by such Stockholder and (B) a fraction, the numerator of which
shall be the total number of such shares proposed to be sold to a purchaser as
set forth in a Transfer Notice or initially proposed to be registered by the
Selling TPG Stockholder, as the case may be, and the denominator of which shall
be the total number of such shares then outstanding (including such shares
proposed to be sold or registered by the Selling TPG Stockholder).
(iv) Notwithstanding anything to the contrary contained herein but
subject to the last sentence of Section 2.5(b)(ii), if a Selling TPG Stockholder
proposes to transfer both Common Shares and Preferred Shares in the same
transaction or in related transactions, each Other Stockholder electing to sell
Shares pursuant to this Section 2.5(b) shall be required to sell both Common
Shares and Preferred Shares. In such event, the number of Preferred Shares which
each Other Stockholder may sell or transfer pursuant to this Section 2.5(b)
shall be up to its applicable Pro Rata Portion of such shares, and the number of
Common Shares which such Other Stockholder shall be required to sell or transfer
in such transaction or transactions shall be exactly the product (rounded to the
nearest whole number) of (A) the total number of Preferred Shares to be sold or
transferred by such Other Stockholder determined in accordance with this Section
2.5(b)(iv) and (B) a fraction, of which the numerator shall be the number of
Common Shares proposed to be sold by the Selling TPG Stockholder and the
denominator shall be the number of Preferred Shares proposed to be sold by the
Selling TPG Stockholder.
(v) Notwithstanding anything to the contrary contained herein, the
provisions of this Section 2.5(b) shall not apply to any sale or transfer by the
TPG Holders of a class of Shares in connection with the retention by the Company
or its subsidiaries of directors, officers, advisors or consultants, or the sale
of other securities of the Company, its parent or subsidiaries, unless and until
the TPG Holders, after giving effect to the proposed sale or transfer, shall
have sold or transferred in the aggregate, other than to Permitted Transferees,
more than 10% of such class of Shares outstanding on the date of such sale.
(c) PIGGYBACK REGISTRATION RIGHTS.
(i) NOTICE TO STOCKHOLDERS. If the Company determines that it
will file a registration statement under the Securities Act, other than a
registration statement on Form X-0, Xxxx X-0 or any similar form under the
Securities Act, for an offering of Shares by the Company or a TPG Holder (a
"REGISTERING SELLER"), then the Company shall give prompt written notice to each
of the Other Stockholders that such filing is expected to be made (but in no
event less than 30 days nor more than 60 days in advance of filing such
registration statement), the class of Shares included in the offering, the
jurisdiction or jurisdictions in which such offering is expected to be made, and
the underwriter or underwriters (if any) that the Company (or the person
requesting such registration) intends to designate for such offering. If the
Company,
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within 15 days after giving such notice, receives a written request for
registration of any Shares of the same class from any of the Other Stockholders,
then the Company shall include in the same registration statement the number of
such additional Shares to be sold by each Other Stockholder as shall have been
specified in its request; PROVIDED, HOWEVER, that each Other Stockholder shall
not be permitted to register more than a Pro Rata Portion (as defined in Section
2.5(b)(iii), substituting "Registering Seller" for "Selling TPG Stockholder") of
its Shares. The rights of the Other Shareholders pursuant to this Section
2.5(c)(i) to register their respective Shares shall be transferable to the
transferees of such Shares. The Company shall bear all costs of preparing and
filing the registration statement, including any fees of the Securities and
Exchange Commission or the National Association of Securities Dealers, Inc. (but
shall not be responsible for underwriting discounts or fees or similar costs or
expenses, or fees or expenses of counsel to any selling stockholder), and shall
indemnify and hold harmless any selling shareholder of any Shares covered by
such registration statement, the transferees of any such selling shareholder and
the underwriters, if any, and their respective affiliates and control persons
against liability under the Securities Act and the Exchange Act relating to such
registration statement. Each selling shareholder shall indemnify the Company and
the underwriters, if any, and their respective affiliates and control persons
against liability under the Securities Act and the Exchange Act relating to
information provided by such selling shareholder in writing specifically for
inclusion in the registration statement.
Notwithstanding anything herein to the contrary, the Company, on prior
notice to the participating Stockholder, may abandon its intention to file a
registration statement under this Section 2.5(c) at any time prior to such
filing.
(ii) ALLOCATION. If the managing underwriter shall inform the
Company (or the person requesting such registration) in writing that the number
of Common Shares requested to be included in such registration exceeds the
number which can be sold in (or during the time of) such offering within a price
range acceptable to the Company (or, if the offering is not for the Company's
account, such person), then the Company shall include in such registration such
number of Common Shares which the Company (or such person) is so advised can be
sold in (or during the time of) such offering. All Stockholders proposing to
sell Common Shares shall share pro rata in the number of Common Shares to be
excluded from such offering, such sharing to be based on the respective numbers
of Common Shares as to which registration has been requested by such
Stockholders.
(iii) PERMITTED TRANSFER. Notwithstanding anything to the
contrary contained herein, sales of Common Shares pursuant to a registration
statement filed by the Company may be made without compliance with any provision
of this Article II other than this Section 2.5(c).
(d) CALL RIGHT. Notwithstanding anything to the contrary contained
herein, the TPG Holders shall have the right to purchase from any of the Other
Stockholders, at any time and from time to time, all or any portion of the
Preferred Shares held by such Other Stockholder at a per share purchase price in
cash equal to the per share redemption price (including accumulated and unpaid
dividends, as applicable) of the Preferred Shares then in effect. Such right
shall be exercised by the delivery by a TPG Holder of a written notice to the
Other Stockholder, and such purchase and sale shall be effected on the third
business day following
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delivery of such notice by a wire transfer of immediately available funds in the
amount of the purchase price against delivery of stock certificates representing
the Preferred Shares being purchased and sold.
ARTICLE III
LEGENDS ON SHARE CERTIFICATES
3.1 The certificates representing the Shares shall include an
endorsement typed conspicuously thereon of the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER STATE SECURITIES
LAWS. THESE SECURITIES MAY NOT BE RESOLD OR TRANSFERRED UNLESS
REGISTERED OR EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933
AND APPLICABLE STATE SECURITIES LAWS. IN ADDITION, THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF A
STOCKHOLDERS' AGREEMENT DATED AS OF AUGUST 4, 1999 AND MAY NOT BE
VOTED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE
WITH SUCH AGREEMENT."
In the event that any Shares shall cease to be Restricted Shares (as
hereinafter defined), the Company shall, upon the written request of the holder
thereof, issue to such holder a new certificate representing such Shares without
the first two sentences of the legend required by this Section 3.1. In the event
that any Shares shall cease to be subject to the restrictions on transfer set
forth in this Agreement, the Company shall, upon the request of the holder
thereof, issue to such holder a new certificate representing such Shares without
the third sentence of the legend required by Section 3.1.
"RESTRICTED SHARES" shall mean all Shares other than (a) Shares that
have been registered under a registration statement pursuant to the Securities
Act and sold thereunder, (b) Shares with respect to which a sale or other
disposition has been made in reliance on and in accordance with Rule 144 (or any
successor provision) under the Securities Act, or (c) Shares with respect to
which the holder thereof shall have delivered to the Company either (i) an
opinion, in form and substance satisfactory to the Company, of counsel, who
shall be satisfactory to the Company, or (ii) a "no action" letter from the
Securities and Exchange Commission, to the effect that subsequent transfers of
such Shares may be effected without registration under the Securities Act.
3.2 All certificates for Shares representing Restricted Shares
hereafter issued, whether upon transfer or original issue, shall be endorsed
with a like legend.
3.3 Upon the exercise of any option to purchase described herein, the
certificates representing the Shares purchased shall be delivered to the
Secretary of the Company and properly endorsed for transfer on the stock books
of the Company.
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ARTICLE IV
RIGHTS WITH RESPECT TO RESALES
4.1 PROFIT SHARING. In the event that a Sale Transaction (as defined
below) is consummated at any time during the period commencing on the date
hereof and ending on the date which is twelve months from and after the date
hereof (the "RESALE PERIOD"), TPG Holdings shall pay or cause to be paid to
Motorola an aggregate amount (the "PROFIT SHARING AMOUNT") equal to 30% of the
aggregate Resale Profit (as defined below) realized by TPG Holdings from such
Sale Transaction. The Profit Sharing Amount shall be paid in the same form and
composition as comprises the Sale Consideration (as defined below) at the
closing thereof.
4.2 DEFINITIONS. For purposes of this Article IV, the following terms
have the meanings set forth below:
(a) "SALE TRANSACTION" means any sale, conveyance, assignment,
disposition or other transfer, other than to a Permitted Transferee of TPG
Holdings, of all or substantially all of the assets or voting stock of the
Company, whether by sale of stock or assets, merger, consolidation or otherwise,
but excluding (i) a sale of securities in an underwritten public offering
registered under the Securities Act or (ii) a pledge or assignment of interests
or assets of the Company to a lender in the ordinary course of business (and the
subsequent exercise of remedies by such lender).
(b) "RESALE PROFIT" means, with respect to any Sale Transaction, an
amount equal to the excess, if any, of (i) the Sale Consideration received by,
payable to or inuring to the benefit of, the holders of Common Shares, directly
or indirectly, in respect of the Common Shares as a result of such Sale
Transaction, over (ii) the sum of (A) $187,500,000, (B) the amount of any
additional equity contribution made to the Company or its Subsidiaries to or for
Common Shares after the date hereof, and (C) any taxes, fees or expenses
incurred in connection with the Sale Transaction.
(c) "SALE CONSIDERATION" means, with respect to any Sale Transaction,
the value of all cash, securities and other property paid, or to be paid,
directly or indirectly, by an acquiror to holders of Common Shares or the
Company in connection with such Sale Transaction. The value of any non-cash
consideration shall be the fair market value of such consideration, as
determined in good faith by the Board of Directors of the Company.
ARTICLE V
ADDITIONAL PARTIES
Notwithstanding the provisions of Section 6.3, additional Stockholders
may be added to and be bound by and receive the benefits afforded by this
Agreement upon the signing and delivery of a counterpart of this Agreement by
the Company and the acceptance thereof by such additional Stockholders, PROVIDED
that any Permitted Transferee of a TPG Holder that is an affiliate of such TPG
Holder shall, by signing and delivering such a counterpart of this Agreement,
become a TPG Holder under this Agreement. Promptly after signing and delivering
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such a counterpart of this Agreement, the Company will deliver a conformed copy
thereof to the Stockholders.
ARTICLE VI
MISCELLANEOUS PROVISIONS
6.1 SPECIFIC PERFORMANCE. The parties hereby declare and acknowledge
that it is impossible to measure in money the damages which will accrue to any
party hereto or to a representative of a Stockholder by reason of a failure to
perform any of the obligations under this Agreement. Therefore, if any party
hereto or the representative of a Stockholder shall institute any action or
proceeding to enforce the provisions hereof, the person against whom such action
or proceeding is brought hereby waives the claim or defense that such party or
such representative has an adequate remedy at law, and such person shall not
urge in any such action or proceeding the claim or defense that such party or
such representative has an adequate remedy at law. The parties hereto agree that
this Agreement shall be specifically enforceable.
6.2 NOTICES. Any and all notices, designations, offers, acceptances or
other communications provided for herein shall be given in writing by registered
or certified mail, which shall be addressed, in the case of the Company, to its
principal office, and, in the case of any Stockholder, to such Stockholder's
address appearing on the stock books of the Company or to such other address as
may be designated by such Stockholder in writing to the Company.
6.3 ENTIRE AGREEMENT. This Agreement constitutes the only agreement
between the parties hereto respecting restrictions on the transferability of the
Shares and supersedes all prior agreements, expressed or implied, between the
parties with respect to the matters set forth herein.
6.4 GOVERNING LAW. The validity, construction and performance of this
Agreement shall be governed by the laws of the State of New York without giving
effect to principles of conflicts of laws except Section 5-1401 of the General
Obligations Law of the State of New York.
6.5 BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties hereto, and their successors and assigns.
6.6 SEVERABILITY. If any portion of this Agreement shall be declared
void or unenforceable by any court or administrative body of competent
jurisdiction, such portion shall be deemed severable from the remainder of this
Agreement, which shall continue in all respects valid and enforceable.
6.7 AMENDMENT AND WAIVER. Any amendment of this Agreement or any waiver
of any provision hereof to be effective shall be in writing and signed by all of
the parties hereto. The addition of a Transferee of Shares or a recipient of any
Shares as a party hereto pursuant to Article V hereof shall not constitute an
amendment hereto and need be signed only by the Company and such Transferee or
recipient. Any failure by any party at any time to enforce any of the provisions
of this Agreement shall not be construed a waiver of such provision or any other
provisions hereof.
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6.8 TERMINATION. This Agreement shall terminate on the earlier of (a)
the date on which the shares of capital stock of the Company held by the TPG
Holders represent, in the aggregate, less than thirty-five percent (35%) of the
total voting power of the Company's capital stock and (b) the consummation of an
underwritten initial public offering by the Company of any Shares; PROVIDED,
HOWEVER, that the rights, if any, of any Stockholder set forth in Section 2.5(c)
of this Agreement shall terminate with respect to a class of Shares at such time
(not earlier than the third anniversary of the date of this Agreement) as the
Stockholder shall be legally permitted to sell all Shares of such class then
held by the Stockholder without registering such Shares under the Securities
Act.
6.9 MANAGEMENT FEES. The Company and its subsidiaries shall not pay to
TPG Holdings or its affiliates any management fee during the term of this
Agreement.
6.10 COUNTERPARTS. This Agreement may be signed by each party hereto
upon a separate copy of this Agreement in which event all of said copies shall
constitute a single counterpart of this Agreement. This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original,
and it shall not be necessary in making proof of this Agreement to produce or
account for more than one such counterpart.
Each Stockholder in agreement with the foregoing should sign the form
of acceptance in the space provided for such Stockholder's signature on this
copy of this Agreement delivered to such Stockholder. This Agreement will become
a binding agreement among such Stockholders and the Company when signed by the
Company and so accepted by such Stockholders.
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The foregoing Stockholders' Agreement is hereby accepted as of the day
and year first above written.
SCG HOLDING CORPORATION
By: /s/ Xxxxxx X. Xxxx
-------------------------------------
Name:
Title:
[remainder of page intentionally left blank]
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Stockholders:
TPG SEMICONDUCTOR HOLDINGS LLC
By: /s/ Xxxxxxxx Xxx
----------------------------------
Name: Xxxxxxxx Xxx
Title: Vice President
[remainder of page intentionally left blank]
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MOTOROLA, INC.
By: /s/ Xxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
[remainder of page intentionally left blank]
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SCHEDULE 1.4
Stockholder Common Shares Owned
----------- -------------------
TPG Semiconductor Holdings LLC 91,463
Motorola, Inc. 8,537
Stockholder Preferred Shares Owned
----------- ----------------------
TPG Semiconductor Holdings LLC 1,500
Motorola, Inc. 590
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