-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, UiEK4QyrJWcjkp2xZ8G7MQLd4CIfHfq45baMsc4U0mEi++DWjOzgPHVFZrLR5Tot t8ffdxw2OIG2vYdnC+xmsw== 0000950149-95-000383.txt : 199506280000950149-95-000383.hdr.sgml : 19950628 ACCESSION NUMBER: 0000950149-95-000383 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19950627 SROS: NASD SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LSI LOGIC CORP CENTRAL INDEX KEY: 0000703360 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 942712976 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-60621 FILM NUMBER: 95549658 BUSINESS ADDRESS: STREET 1: 1551 MCCARTHY BLVD STREET 2: MS D 106 CITY: MILPITAS STATE: CA ZIP: 95035 BUSINESS PHONE: 4084334039 MAIL ADDRESS: STREET 1: 1551 MCCARTHY BLVD STREET 2: MS D 106 CITY: MILPITAS STATE: CA ZIP: 95035 S-3 1 FORM S-3 REGISTRATION FOR LSI LOGIC 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 27, 1995 REGISTRATION NO. 33- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ LSI LOGIC CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 1551 MCCARTHY BOULEVARD 94-2712976 (STATE OR OTHER JURISDICTION OF MILPITAS, CALIFORNIA 95035 (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) (408) 433-8000 IDENTIFICATION NO.)
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) DAVID E. SANDERS VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY LSI LOGIC CORPORATION 1551 MCCARTHY BOULEVARD MILPITAS, CALIFORNIA 95035 (408) 433-8000 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) ------------------------ COPIES TO: LARRY W. SONSINI EDWARD M. LEONARD JUDITH M. O'BRIEN GARI L. CHEEVER WILSON, SONSINI, GOODRICH & ROSATI BROBECK, PHLEGER & HARRISON PROFESSIONAL CORPORATION TWO EMBARCADERO PLACE 650 PAGE MILL ROAD 2200 GENG ROAD PALO ALTO, CA 94304-1050 PALO ALTO, CA 94303-0913 (415) 493-9300 (415) 424-0160
------------------------ APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT. ------------------------ If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. / / If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. / / If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, 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. / / ------------------------ CALCULATION OF REGISTRATION FEE - ------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------- PROPOSED PROPOSED MAXIMUM TITLE OF EACH CLASS AMOUNT MAXIMUM AGGREGATE AMOUNT OF OF SECURITIES TO BE OFFERING PRICE OFFERING REGISTRATION TO BE REGISTERED REGISTERED(1) PER SHARE(2) PRICE(2) FEE - ------------------------------------------------------------------------------------------------------- Common Stock, $.01 par value....................... 5,750,000 shares $41.125 $236,468,750 $81,542 - ------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------
(1) Includes 750,000 shares which the Underwriters have the option to purchase to cover over-allotments, if any. Also includes Preferred Share Purchase Rights associated with the Common Stock. (2) Estimated solely for the purpose of computing the amount of the registration fee, based on the average of the high and low prices for the Common Stock as reported on the New York Stock Exchange on June 26, 1995, in accordance with Rule 457(c) promulgated under the Securities Act of 1933. ------------------------ THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION, DATED JUNE 27, 1995 PROSPECTUS 5,000,000 SHARES LSI LOGIC CORPORATION COMMON STOCK ------------------------ All of the 5,000,000 shares of Common Stock offered hereby are being sold by LSI Logic Corporation (the "Company"). The Company's Common Stock is traded on the New York Stock Exchange ("NYSE") under the symbol "LSI." On June 26, 1995, the last reported sale price of the Company's Common Stock on the NYSE was $40.375 per share. See "Price Range of Common Stock." ------------------------ SEE "RISK FACTORS" AT PAGE 4 FOR CERTAIN FACTORS RELEVENT TO AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY. ------------------------ 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. - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------- Price to Underwriting Discounts Proceeds to Public and Commissions(1) Company(2) - ----------------------------------------------------------------------------------------------------- Per Share....................... $ $ $ - ----------------------------------------------------------------------------------------------------- Total(3)........................ $ $ $ - ----------------------------------------------------------------------------------------------------- - -----------------------------------------------------------------------------------------------------
(1) The Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended. See "Underwriting." (2) Before deducting estimated expenses of $300,000 payable by the Company. (3) The Company has granted the Underwriters a 30-day option to purchase up to 750,000 additional shares of Common Stock on the same terms and conditions as set forth above, solely to cover over-allotments, if any. If such option is exercised in full, the total Price to Public, Underwriting Discounts and Commissions and Proceeds to Company will be $ , $ and $ , respectively. See "Underwriting." ------------------------ The shares of Common Stock offered by this Prospectus are offered by the Underwriters subject to prior sale, to withdrawal, cancellation or modification of the offer without notice, to delivery to and acceptance by the Underwriters and to certain other conditions. It is expected that delivery of the certificates for the shares of Common Stock will be made at the offices of Lehman Brothers Inc., New York, New York, on or about July , 1995. ------------------------ LEHMAN BROTHERS MERRILL LYNCH & CO. MONTGOMERY SECURITIES PRUDENTIAL SECURITIES INCORPORATED July , 1995 3 AVAILABLE INFORMATION LSI Logic Corporation 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 and information statements and other information with the Securities and Exchange Commission (the "Commission"). Reports, proxy statements and other information filed by the Company with the Commission pursuant to the Exchange Act may be inspected and copied at the public reference facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices located at Seven World Trade Center, 13th Floor, New York, New York 10048 and at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material also can be obtained from the Public Reference Branch of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such reports, proxy statements and other information can also be inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005. The Company has filed with the Commission a registration statement on Form S-3 (herein, together with all amendments and exhibits, referred to as the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act"). This Prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. For further information, reference is hereby made to the Registration Statement. INFORMATION INCORPORATED BY REFERENCE The following documents filed with the Commission (File No. 0-11674) pursuant to the Exchange Act are incorporated herein by reference: 1. The Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1995 filed pursuant to Section 13 of the Exchange Act. 2. The Company's Definitive Proxy Statement dated March 27, 1995 in connection with the Annual Meeting of Stockholders held May 12, 1995 filed pursuant to Section 14 of the Exchange Act. 3. The Company's Quarterly Report on Form 10-Q for the quarter ended April 2, 1995 filed pursuant to Section 13 of the Exchange Act. 4. The description of the Company's Common Stock contained in its Registration Statement on Form 8-A filed with the Commission on August 29, 1989 pursuant to Section 12(b) of the Exchange Act. 5. The description of the Company's Preferred Shares Purchase Rights contained in its Registration Statement on Form 8-A filed with the Commission on November 21, 1988 pursuant to Section 12(a) of the Exchange Act. 6. All reports and other documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of this offering. Any statement incorporated herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein, in a Prospectus Supplement or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of the Registration Statement or this Prospectus. The Company will provide without charge to each person, including any beneficial owner, to whom this Prospectus is delivered, upon the written or oral request of such person, a copy of any and all of the documents which are incorporated herein by reference (other than exhibits to such documents, unless such exhibits are specifically incorporated by reference into such document). Requests for such documents should be directed to LSI Logic Corporation, Investor Relations, 1551 McCarthy Boulevard, Mail Stop D-105, Milpitas, California 95035, or by calling (408) 433-8585. ------------------------ The LSI Logic logo and CoreWare are registered trademarks of the Company. All other brand names or trademarks appearing in this Prospectus are the property of their respective holders. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. 2 4 PROSPECTUS SUMMARY The following summary is qualified in its entirety by the more detailed information and consolidated financial statements, including notes thereto, appearing elsewhere in, or incorporated by reference into, this Prospectus. Unless otherwise indicated, the information contained in this Prospectus (i) assumes no exercise of the Underwriters' over-allotment option, (ii) gives effect to a 2-for-1 stock split in the form of a dividend paid on June 21, 1995 and (iii) reflects the amendment to the Company's Certificate of Incorporation to increase the Company's authorized Common Stock effected in May 1995. THE COMPANY LSI Logic Corporation (the "Company") is a leader in the design, development, manufacture and marketing of high performance application-specific integrated circuits ("ASICs"). The Company uses advanced process technology and computer-aided design methodology to design and develop highly complex ASICs and other integrated circuits. The Company's sub-micron process technologies combined with its product libraries, including CoreWare libraries, provide the Company with the ability to integrate system level solutions on a single chip. The Company focuses its product marketing strategy primarily on original equipment manufacturers in the electronic data processing, telecommunications and certain office automation industries and, within these industries, emphasizes digital video, networking, desktop and personal computing and wireless communication applications. The Company increasingly directs its marketing and selling efforts towards a limited number of customers that are acknowledged industry leaders in these markets. The Company's customers include Alcatel NV, AT&T, Cisco Systems, Inc., Compaq Computer Corporation, Digital Equipment Corporation, Hewlett-Packard Company, International Business Machines Corporation, Intel Corporation, Matsushita Electric Industrial Co., Ltd., Newbridge Networks Corporation, Siemens AG, Silicon Graphics, Inc., Sony Corporation ("Sony") and Sun Microsystems, Inc. THE OFFERING Common Stock offered by the Company.......... 5,000,000 shares Common Stock to be outstanding after the offering................................... 126,406,212 shares(1) NYSE Symbol.................................. LSI Use of Proceeds.............................. Capital expenditures and general corporate purposes. See "Use of Proceeds."
- --------------- (1) Based on shares outstanding at March 31, 1995. Excludes 9,514,341 shares issuable as of March 31, 1995 upon exercise of options granted under the Company's 1991 Equity Incentive Plan, 1982 Incentive Stock Option Plan and 1986 Directors' Stock Option Plan. Also excludes 11,734,700 shares reserved for issuance upon conversion of the Company's 5 1/2% Convertible Subordinated Notes due 2001. 3 5 RISK FACTORS In addition to the other information in this Prospectus and incorporated herein by reference, the following factors should be carefully considered in evaluating the Company and its business before purchasing shares of Common Stock offered hereby. DEPENDENCE ON NEW PROCESS TECHNOLOGIES AND PRODUCTS. The Company believes that its future success depends, in part, on its ability to improve its existing technologies and to develop and implement new process technologies in order to continue to reduce semiconductor die size, improve device performance and manufacturing yields, adapt products and processes to technological changes and adopt emerging industry standards. If the Company is not able to implement new process technologies successfully and achieve volume production of new products at acceptable yields using new manufacturing processes, the Company's operating results will be adversely affected. In addition, the Company must continue to develop and introduce new products that compete effectively on the basis of price and performance and that satisfy customer requirements. New product development often requires long-term forecasting of market trends, development and implementation of new processes and technologies and a substantial capital commitment. The Company intends the CoreWare library elements it offers to be based upon industry standard functions, protocols and interfaces, thereby positioning them to be useful in a wide variety of systems applications. The Company is increasingly emphasizing engineering development and acquisition of CoreWare building blocks and integration of CoreWare libraries into its design capabilities. There can be no assurance, however, that the cores selected for investment of the Company's financial and engineering resources will be developed or acquired in a timely manner or will enjoy market acceptance. MANUFACTURING RISKS. Disruption of operations at any of the Company's primary manufacturing facilities, particularly the Company's Japanese facilities, or any of its subcontractors for any reason, including work stoppages, fire, earthquake or other natural disasters, would cause delays in shipments of the Company's products. There can be no assurance that alternate capacity, particularly wafer production capacity, would be available on a timely basis or at all, or that if available, it could be obtained on favorable terms. The Company has been operating most of its manufacturing facilities at or close to capacity during the last year. Although the Company currently has plans to increase its production capacity through the installation of new production equipment at its manufacturing facilities, planned construction of a new fabrication facility in the United States and technology improvements, there is no assurance that the Company will be able to expand its manufacturing capacity to meet expected future demand, which could result in a loss of customers and could materially and adversely affect the Company's operating results. In addition, if demand for the Company's products does not absorb the additional capacity, the increase in fixed costs and operating expenses related to increases in production capacity may materially and adversely affect the Company's operations. FLUCTUATIONS IN OPERATING RESULTS. The Company believes that its future operating results will continue to be subject to quarterly variations based upon a wide variety of factors, including the cyclical nature of both the semiconductor industry and the markets addressed by the Company's products, the ability to develop and implement new technologies, the availability and extent of utilization of manufacturing capacity, changes in product mix, fluctuations in manufacturing yields, the timing of new product introductions, price erosion, exchange rate fluctuations and other factors. As a participant in the semiconductor industry, the Company operates in a technologically advanced, rapidly changing and highly competitive environment. The Company predominantly sells custom products to customers operating in a similar environment. Accordingly, changes in the conditions of any of the Company's customers may have a greater impact on the Company than if the Company offered standard products that could be sold to many purchasers. While the Company cannot predict what effect these factors may have on its financial results, the aggregate effect of these and other factors could result in significant volatility in the Company's future performance and stock price. To the extent the Company's performance may not meet expectations published by external sources, public reaction could result in a sudden and significantly adverse impact on the market price of the Company's securities, particularly on a short-term basis. COMPETITION. The semiconductor industry in general and the markets in which the Company competes in particular are intensely competitive, exhibiting both rapid technological changes and continued price erosion. The Company's competitors include many large domestic and foreign companies which have substantially greater financial, technical and management resources than the Company, as well as emerging companies attempting to sell products to specialized markets such as those addressed by the Company. 4 6 Several major diversified electronics companies, including Fujitsu, Ltd., Toshiba Corporation and NEC Corporation, and a number of United States semiconductor manufacturers, including AT&T, Motorola Inc. and Texas Instruments Incorporated, offer ASIC products or other products which are competitive with the product lines of the Company. In addition, there is no assurance that certain large customers, some of whom have licensed elements of the Company's process and product technologies, will not develop internal design and production operations to produce their own ASICs. CAPITAL NEEDS. The semiconductor industry is extremely capital intensive requiring continuing investments in new facilities and equipment. To remain competitive, the Company must continue to expand its facilities and to invest in advanced manufacturing and test equipment. During 1995, the Company expects to make net capital expenditures of approximately $200 to $250 million. The Company currently estimates that the cost to construct and fully equip its proposed new facility as well as to acquire new equipment for existing facilities will require annual capital expenditures in excess of these amounts in each of the next several years. While the Company believes that the proceeds from this offering, together with existing cash balances, cash flow from operations, and available equipment lease financing will be sufficient to meet the Company's liquidity and capital requirements for the next 12 months, there can be no assurance that the Company will not be required to seek other financing sooner or that such financing, if required, would be available on terms satisfactory to the Company. In this regard, any significant adverse effect upon the Company's cash flow from operations could accelerate the Company's need to seek additional outside capital. CURRENCY RISKS. In countries in which the Company is conducting business in a local currency, currency exchange fluctuations could adversely affect the Company's revenues and costs. A substantial portion of the costs of the Company's manufacturing operations are denominated in Japanese yen. In addition, the Company purchases a substantial portion of its raw materials and equipment from foreign suppliers and incurs labor costs in foreign locations. A portion of these transactions are denominated in currencies other than in U.S. dollars, principally in Japanese yen. International sales are generally denominated in local currencies. The Company also has borrowings denominated in yen, which totaled approximately 15 billion yen (approximately $172 million at March 31, 1995) and in June 1995 entered into a 15 billion yen lease line under which approximately 6.2 billion yen (approximately $74 million) will have been drawn down by June 30, 1995. Such transactions and borrowings expose the Company to exchange rate fluctuations for the period of time from inception of the transaction until it is settled. In recent years, the yen has fluctuated substantially against the U.S. dollar. However, the Company has entered and will from time to time enter into hedging transactions in order to minimize exposure to currency rate fluctuations. There can be no assurance that such hedging transactions will minimize exposure to currency rate fluctuations or that fluctuations in currency exchange rates in the future will not have an adverse impact on the Company's results of operations. CUSTOMER CONCENTRATION. As a result of the Company's strategy to direct its marketing and selling efforts toward selected customers, the Company expects that it will become increasingly dependent on a limited number of customers for a substantial portion of its revenues. During 1994 and the quarter ended March 31, 1995, approximately 58% and 62%, respectively, of the Company's net revenues were derived from sales to its top ten customers. Sales to Sony for its Playstation game console are expected to account for slightly in excess of 10% of the Company's revenues during the first half of 1995. Loss of new product design wins or cancellation of business from any of these major customers, significant changes in scheduled deliveries to any of these customers or decreases in the prices of products sold to any of these customers could materially adversely affect the Company's results of operations. INTELLECTUAL PROPERTY AND TEXAS INSTRUMENTS LITIGATION. Although the Company believes that the protection afforded by its patents, patent applications and trademarks has value, the rapidly changing technology in the semiconductor industry makes the Company's future success dependent primarily upon the technical competence and creative skills of its personnel rather than on patent and trademark protection. As is typical in the semiconductor industry, the Company has from time to time received, and may in the future receive, communications from other parties asserting patent rights, mask work rights, copyrights or trademark rights that such other parties allege cover certain of the Company's products, processes, technologies or information. Several such assertions relating to patents are in various stages of evaluation. The Company is considering whether to seek licenses with respect to certain of these claims. As described below, litigation has 5 7 arisen with respect to one of these assertions. Based on industry practice, the Company believes that licenses or other rights, if necessary, could be obtained on commercially reasonable terms for such existing or future claims. Nevertheless, no assurance can be given that licenses can be obtained, or if obtained will be on acceptable terms or that litigation or other administrative proceedings will not occur. The inability to obtain certain licenses or other rights or to obtain such licenses or rights on favorable terms, or litigation arising out of such other parties assertions, both existing and future, could have a material adverse effect on the Company's future operating results. The Company is one of three defendants in a patent infringement suit brought by Texas Instruments ("TI"). This suit resulted in a May 1995 jury verdict against the Company holding the patents valid and finding wilful infringement. Damages against the Company were set by the jury at $14.6 million, for which the Company has adequate reserves. Because both of the patents involved in the litigation have expired, the verdict will have no effect upon the manufacture or sale of the Company's present or future products. The Company has filed various post-trial motions which, if granted, could reduce the jury award or set aside the jury verdict entirely. TI has requested treble damages, pre-judgment interest in the amount of $7.5 million from the Company and attorneys' fees that total $3.8 million from all parties. The Company believes that the jury verdict was in error and intends to appeal. The Company continues to believe that the final outcome of this matter will not have a material adverse effect on the Company's consolidated financial position or results of operations. No assurance can be given, however, that this matter will be resolved without the payment of damages and other costs or that damages will not be increased to an amount in excess of the Company's reserves, thereby having an adverse effect on the Company. CYCLICAL NATURE OF THE SEMICONDUCTOR INDUSTRY. The semiconductor industry is characterized by rapid technological change, rapid product obsolescence and price erosion. The semiconductor industry historically has been characterized by wide fluctuations in product supply and demand. From time to time the industry also has experienced significant downturns, often in connection with, or in anticipation of, maturing product cycles (of both the semiconductor companies and their customers) 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. For example, the Company believes that its operating results were adversely affected by an industry-wide downturn in the demand for semiconductors beginning in 1990, culminating in the Company's 1992 restructuring charge and reorganization of its operations. Currently, the semiconductor industry in general, including the Company, is experiencing a period of increased demand. There is no assurance that these conditions will continue. The Company may experience substantial period-to-period fluctuations in future operating results due to general industry conditions, events occurring in the worldwide economy or a significant industry-wide downturn. 6 8 THE COMPANY LSI Logic Corporation (the "Company") is a leader in the design, development, manufacture and marketing of high performance application-specific integrated circuits ("ASICs"). The Company uses advanced process technology and computer-aided design methodology to design and develop highly complex ASICs and other integrated circuits. The Company's sub-micron process technologies combined with its product libraries, including CoreWare libraries, provide the Company with the ability to integrate system level solutions on a single chip. The Company has increasingly directed its marketing and selling efforts toward selected customers in high growth end markets that are characterized by increasingly shortened product cycles and ongoing changes in technological standards and performance requirements. As a result, customers in these markets tend to benefit from the flexibility of customized ASIC design methodology to help differentiate their products while still complying with existing and emerging global industry standards such as Ethernet and ATM (Asynchronous Transfer Mode) in the networking market, PCI bus interface in the personal computer market and MPEG2 (Motion Picture Experts Group) for video compression applications in the digital video market. The Company focuses its product marketing strategy primarily on original equipment manufacturers in the electronic data processing, telecommunications and certain office automation industries and, within these industries, emphasizes digital video, networking, desktop and personal computing and wireless communication applications. The Company increasingly directs its marketing and selling efforts towards a limited number of customers that are acknowledged industry leaders in these markets. The Company's customers include Alcatel NV, AT&T, Cisco Systems, Inc., Compaq Computer Corporation, Digital Equipment Corporation, Hewlett-Packard Company, International Business Machines Corporation, Intel Corporation, Matsushita Electric Industrial Co., Ltd., Newbridge Networks Corporation, Siemens AG, Silicon Graphics, Inc., Sony Corporation and Sun Microsystems, Inc. The Company's CoreWare product library approach and its sub-micron process technologies permit system-level integration of functional cores or elements including microprocessor "engines," logic blocks (including industry-standard functions, protocols and interfaces), memory and customer-specific proprietary logic functions on a single piece of silicon. Examples of these elements include the MIPS microprocessor core family and cores implementing Ethernet, MPEG, JPEG and ATM standards. This methodology enables customers to improve the performance, reliability and further differentiate their products while shortening product development cycles, lowering development costs and optimizing the customer's application. The Company's proprietary computer-aided design tools are highly integrated with the Company's manufacturing process requirements, thereby providing high predictability that a product's physical performance will mirror the computer simulation of the chip and affording high predictability of performance of products developed using the Company's design methodology. The Company's sophisticated design tools, advanced process technology and sub-micron manufacturing capability are intended to provide customers with highly integrated solutions that work right the first time. The Company provides customers with a comprehensive approach and a continuum of solutions for the design and manufacture of leading-edge ASICs. This allows customers substantial flexibility in how they proceed with an ASIC design project. A customer may establish product specifications for implementation into a particular chip design by the customer's engineers, by the Company's engineers on a "turn-key" basis or through a collaborative effort. The Company's design environment includes expanded interface capabilities to certain third-party EDA software design tools from companies such as Cadence Design Systems, Inc., Mentor Graphics Corporation and Synopsys, Inc. The Company has developed and uses advanced manufacturing process technologies, including 0.6-micron and 0.5-micron CMOS processes, for its advanced product offerings. As process technology becomes more sophisticated, allowing greater density and increased functionality on a single chip, the system-on-a-chip is becoming the foundation of the Company's approach to the marketplace. The Company believes that owning its wafer manufacturing facilities not only provides better access to capacity but also improves quality, cost-effectiveness, responsiveness to customers, ability to implement 7 9 leading-edge process technology and time-to-market as compared to companies that do not own their own wafer fabrication facilities. The Company's manufacturing operations are located in the United States, Japan and Hong Kong. The Company performs substantially all of its packaging, assembly and final test operations through third-party subcontractors in various locations. During 1994, the Company's United States production operations received ISO-9002 certification, an important international measure for quality. The Company markets its products and services on a worldwide basis through its direct sales, marketing and field technical staff of approximately 750 employees (including its majority-owned subsidiaries in Europe, Canada and Japan) and through independent sales representatives and distributors. The Company operates over 25 design centers around the world to assist customers in product design activities. The Company's network of design centers allows the Company to provide its customers with highly experienced engineers to interact with its customers' engineering management and system architects to develop designs for new products and to provide continuing after-sale customer support. The Company was incorporated in California on November 6, 1980 and reincorporated in Delaware on June 11, 1987. Its principal offices are located at 1551 McCarthy Boulevard, Milpitas, California 95035, and its telephone number at that location is (408) 433-8000. Except where otherwise indicated, references to the "Company" means LSI Logic Corporation and its subsidiaries. 8 10 USE OF PROCEEDS The net proceeds from the sale of Common Stock offered hereby are estimated to be $193,500,000 ($222,570,000 if the Underwriters' over-allotment option is exercised in full) assuming a public offering price of $40.375 per share and after deducting the estimated underwriters' discounts and commissions and expenses payable by the Company in connection with the offering. The Company intends to use such net proceeds primarily for capital expenditures, principally to purchase equipment for its existing manufacturing facilities and to commence construction of a new 8-inch wafer fabrication facility in the United States, and for general corporate purposes. During 1995, the Company expects to make net capital expenditures of approximately $200 to $250 million, approximately one-half of which has been spent to date. In addition, the Company, from time to time, may consider acquisitions of, or investments in, complementary businesses, assets or technologies. At the present time, however, the Company has no agreements or understandings, nor are there any negotiations pending, with respect to any material acquisitions. The Company believes that the net proceeds from the sale of the Common Stock in this offering, together with existing cash balances, cash flow from operations and available equipment lease financing, will be sufficient to meet the Company's liquidity and capital requirements for the next 12 months. The Company believes that success in its industry requires substantial financial strength and flexibility. Accordingly, the Company may seek additional equity or debt financing to fund the completion of its planned 8-inch wafer fabrication facility, further expansion of its existing fabrication capacity or for other purposes. Pending such uses, the Company will invest the net proceeds in short- or medium-term income producing investments. DIVIDEND POLICY The Company has paid no cash dividends on its Common Stock since its incorporation and anticipates that for the foreseeable future it will continue to retain any earnings for use in its business. PRICE RANGE OF COMMON STOCK The Company's Common Stock is traded on the NYSE under the symbol LSI. The following table sets forth, for the periods indicated, high and low sale prices for the Common Stock on the NYSE.
HIGH LOW --- --- FISCAL 1993 First Quarter............................................. $ 7 1/16 $ 5 1/8 Second Quarter............................................ 7 3/4 5 1/4 Third Quarter............................................. 9 5/8 7 1/8 Fourth Quarter............................................ 8 9/16 6 1/2 FISCAL 1994 First Quarter............................................. 11 1/2 7 3/4 Second Quarter............................................ 13 3/16 8 3/8 Third Quarter............................................. 17 7/8 1 1/16 Fourth Quarter............................................ 22 11/16 1 7/16 FISCAL 1995 First Quarter............................................. 29 3/16 18 1/4 Second Quarter (through June 26, 1995).................... 42 5/8 25 1/2
On June 26, 1995, the last reported sale price of the Common Stock on the NYSE was $40.375 per share. 9 11 CAPITALIZATION The following table sets forth the consolidated short-term debt and capitalization of the Company at March 31, 1995 and as adjusted to give effect to the issuance and sale by the Company of the 5,000,000 shares of Common Stock offered hereby assuming a public offering price of $40.375 per share, and the application of the estimated net proceeds therefrom. The financial data in the following table should be read in conjunction with the Company's audited consolidated financial statements (and notes thereto) at December 31, 1994 and the Company's unaudited consolidated condensed quarterly financial statements (and notes thereto) at March 31, 1995, incorporated herein by reference.
AS OF MARCH 31, 1995 -------------------------------- ACTUAL AS ADJUSTED ---------- ----------- (IN THOUSANDS, EXCEPT SHARE AMOUNTS) Current portion of long-term debt, capital lease obligations and short-term borrowings(1)................................ $ 44,013 $ 44,013 ========= ========= Long-term debt, capital lease obligations and other long-term liabilities, less current portion(1).............. $ 295,806 $ 295,806 ---------- ----------- Minority interest in subsidiaries............................. 29,009 29,009 ---------- ----------- Stockholders' equity(2): Preferred Stock, $.01 par value, 2,000,000 shares authorized, none outstanding............................. -- -- Common Stock, $.01 par value, 250,000,000 shares authorized, 121,406,212 shares issued and outstanding, 126,406,212 shares issued and outstanding as adjusted....................... 607 657 Additional paid-in capital.................................. 565,437 758,887 Retained earnings........................................... 112,329 112,329 Cumulative translation adjustment........................... 112,487 112,487 ---------- ----------- Total stockholders' equity............................... 790,860 984,360 ---------- ----------- Total capitalization................................ $1,115,675 $ 1,309,175 ========= =========
- --------------- (1) For additional information regarding short-term debt, long-term debt and stockholders' equity, see Notes 6 and 7 of Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1995. See "Incorporation of Certain Documents by Reference." (2) Excludes, as of March 31, 1995, (i) 7,841,692 shares reserved for issuance upon exercise of outstanding options granted under the Company's 1991 Equity Incentive Plan and 174,536 shares which remain available for future grant under such plan, (ii) 1,492,649 shares reserved for issuance upon exercise of outstanding options under the Company's 1982 Incentive Stock Option Plan, (iii) approximately 997,878 shares reserved for issuance under the Company's Employee Stock Purchase Plan and (iv) 180,000 shares reserved for issuance upon exercise of outstanding options granted under the 1986 Directors' Stock Option Plan and 67,500 shares which remain available for future grant under such plan. Also excludes 11,734,700 shares of Common Stock reserved for issuance upon conversion of the Company's 5 1/2% Convertible Subordinated Notes due 2001, which Notes are convertible at any time at a rate of one share of Common Stock per $12.25 principal amount of Notes converted, subject to adjustment in certain circumstances. Excludes 100,000 shares of Preferred Stock reserved for issuance in certain circumstances in connection with the Company's Preferred Shares Rights Agreement dated as of November 16, 1988. ----------------------------- During the second quarter of 1995, the Company, through its Japanese subsidiary, entered into a 15 billion yen (approximately $179 million) operating lease line, approximately 6.2 billion yen (approximately $74 million) of which will have been drawn down by June 30, 1995. This lease line will be used to lease equipment for the Company's Japanese manufacturing facility. 10 12 SELECTED CONSOLIDATED FINANCIAL DATA The selected consolidated financial data presented below for, and as of the end of, each of the years in the five-year period ended December 31, 1994 have been derived from the consolidated financial statements of the Company, which have been audited by Price Waterhouse LLP, independent accountants. The selected consolidated financial data presented below at March 31, 1995 and for the quarter then ended and for each of the four fiscal quarters of 1993 and of 1994 have been derived from unaudited consolidated financial statements of the Company. In the opinion of the Company's management, the unaudited consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to fairly state the information set forth therein. Such data should be read in conjunction with the consolidated financial statements, related notes and other financial information incorporated by reference herein. See "Incorporation of Certain Documents by Reference."
THREE MONTHS ENDED YEAR ENDED DECEMBER 31, MARCH 31, ------------------------------------------------------- ----------------------- 1990 1991 1992 1993 1994 1994 1995 -------- -------- --------- -------- ---------- ---------- ---------- (UNAUDITED) (IN THOUSANDS, EXCEPT PER SHARE DATA) STATEMENT OF OPERATIONS DATA(1): Revenues...................................... $655,491 $697,838 $ 617,468 $718,812 $ 901,830 $ 193,812 $ 280,158 -------- -------- --------- -------- ---------- ---------- ---------- Costs and expenses: Cost of revenues............................ 443,759 457,692 408,318 438,523 520,150 115,387 153,399 Research and development.................... 60,196 80,802 78,825 78,995 98,978 23,141 24,378 Selling, general and administrative......... 117,318 136,811 129,254 117,452 124,936 29,457 39,335 Restructuring of operations................. 44,000 5,626 101,785 -- -- -- -- -------- -------- --------- -------- ---------- ---------- ---------- Total costs and expenses.................. 665,273 680,931 718,182 634,970 744,064 167,985 217,112 -------- -------- --------- -------- ---------- ---------- ---------- Income (loss) from operations................. (9,782) 16,907 (100,714) 83,842 157,766 25,827 63,046 Interest expense.............................. (21,256) (19,371) (11,567) (9,621) (18,455) (3,788) (4,183) Interest income and other..................... 12,517 14,722 12,413 6,500 16,858 4,798 5,481 -------- -------- --------- -------- ---------- ---------- ---------- Income (loss) before income taxes, minority interest and extraordinary credit........... (18,521) 12,258 (99,868) 80,721 156,169 26,837 64,344 Provision for income taxes.................... 11,685 6,129 8,521 24,221 43,679 7,514 18,016 -------- -------- --------- -------- ---------- ---------- ---------- Income (loss) before minority interest and extraordinary credit........................ (30,206) 6,129 (108,389) 56,500 112,490 19,323 46,328 Minority interest in net income (loss) of subsidiaries................................ 1,065 (2,212) 1,819 2,750 3,747 (32) 1,068 -------- -------- --------- -------- ---------- ---------- ---------- Income (loss) before extraordinary credit..... (31,271) 8,341 (110,208) 53,750 108,743 19,355 45,260 Extraordinary credit resulting from the retirement of debt.......................... 955 -- -- -- -- -- -- -------- -------- --------- -------- ---------- ---------- ---------- Net income (loss)............................. $(30,316) $ 8,341 $(110,208) $ 53,750 $ 108,743 $ 19,355 $ 45,260 ======== ======== ========= ======== ========= ========= ========= Primary income (loss) per share: Net income (loss) before extraordinary credit.................................... $ (0.37) $ 0.10 $ (1.24) $ 0.55 $ 0.99 $ 0.19 $ 0.37 Extraordinary credit........................ 0.01 -- -- -- -- -- -- -------- -------- --------- -------- ---------- ---------- ---------- Net income (loss) per share................. $ (0.36) $ 0.10 $ (1.24) $ 0.55 $ 0.99 $ 0.19 $ 0.37 ======== ======== ========= ======== ========= ========= ========= Fully diluted net income per share.......... * * * $ 0.52 $ 0.93 $ 0.18 $ 0.35 ======== ========= ========= ========= Common shares and common share equivalents used in computing per share amounts: Primary..................................... 84,126 86,752 88,956 99,062 109,906 103,262 120,770 ======== ======== ========= ======== ========= ========= ========= Fully diluted............................... * * * 109,626 125,428 115,164 132,640 ======== ========= ========= =========
AS OF DECEMBER 31, --------------------------------------------------------- MARCH 31, 1990 1991 1992 1993 1994 1995 -------- --------- -------- ---------- ---------- ---------- (IN THOUSANDS) BALANCE SHEET DATA(2): Working capital............................... $231,248 $ 225,193 $133,640 $ 230,513 $ 422,916 $ 430,615 Total assets.................................. 771,682 748,456 747,438 859,010 1,270,374 1,505,145 Long-term debt, capital lease obligations and other long-term liabilities................. 189,795 166,107 218,837 246,314 288,496 295,806 Stockholders' equity.......................... 267,729 293,075 197,728 292,434 544,906 790,860
11 13 QUARTERLY FINANCIAL DATA(2):
1993 1994 1995 ----------------------------------------- ----------------------------------------- -------- FIRST SECOND THIRD FOURTH FIRST SECOND THIRD FOURTH FIRST QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER -------- -------- -------- -------- -------- -------- -------- -------- -------- (IN THOUSANDS, EXCEPT PER SHARE DATA) STATEMENT OF OPERATIONS DATA: Revenues....................... $168,928 $177,080 $183,761 $189,043 $193,812 $212,106 $240,218 $255,694 $280,158 -------- -------- -------- -------- -------- -------- -------- -------- -------- Costs and expenses: Cost of revenues............. 103,921 108,246 112,001 114,355 115,387 123,337 138,219 143,207 153,399 Research and development..... 18,998 19,408 19,134 21,455 23,141 22,467 26,834 26,536 24,378 Selling, general and administrative............. 29,205 29,007 29,910 29,330 29,457 31,102 30,645 33,732 39,335 -------- -------- -------- -------- -------- -------- -------- -------- -------- Total costs and expenses... 152,124 156,661 161,045 165,140 167,985 176,906 195,698 203,475 217,112 -------- -------- -------- -------- -------- -------- -------- -------- -------- Income from operations......... 16,804 20,419 22,716 23,903 25,827 35,200 44,520 52,219 63,046 Interest expense............... (2,175) (2,384) (2,538) (2,524) (3,788) (5,665) (4,822) (4,180) (4,183) Interest income and other...... 1,697 2,512 1,818 473 4,798 4,127 3,263 4,670 5,481 -------- -------- -------- -------- -------- -------- -------- -------- -------- Income before income taxes and minority interest............ 16,326 20,547 21,996 21,852 26,837 33,662 42,961 52,709 64,344 Provision for income taxes..... 4,901 6,164 6,599 6,557 7,514 9,425 12,028 14,712 18,016 Minority interest in net income (loss) of subsidiaries....... 814 1,313 1,022 (399) (32) 799 1,465 1,515 1,068 -------- -------- -------- -------- -------- -------- -------- -------- -------- Net income..................... $ 10,611 $ 13,070 $ 14,375 $ 15,694 $ 19,355 $ 23,438 $ 29,468 $ 36,482 $ 45,260 ======== ======== ======== ======== ======== ======== ======== ======== ======== Primary net income per share... $ 0.11 $ 0.14 $ 0.15 $ 0.16 $ 0.19 $ 0.22 $ 0.26 $ 0.31 $ 0.37 ======== ======== ======== ======== ======== ======== ======== ======== ======== Fully diluted net income per share........................ * * * $ 0.15 $ 0.18 $ 0.21 $ 0.25 $ 0.30 $ 0.35 ======== ======== ======== ======== ======== ======== Common shares and common share equivalents used in computing per share amounts Primary...................... 94,904 97,748 100,498 101,872 103,262 106,224 112,788 117,702 120,770 ======== ======== ======== ======== ======== ======== ======== ======== ======== Fully diluted................ * * * 112,084 115,164 128,102 127,876 129,436 132,640 ======== ======== ======== ======== ======== ========
- --------------- * Fully diluted amount disclosures are not required because they are substantially the same as primary amounts disclosed for these periods. (1) The Company's fiscal year ends on the Sunday closest to December 31. For presentation purposes, the consolidated financial statements refer to December 31 as year end. Fiscal 1993 was a 53-week year, whereas, 1994, 1992 and 1990 were 52-week years. The fourth quarter of 1993 was a 14-week quarter, whereas the first, second and third quarters were 13-week quarters. The additional week in the fourth quarter of 1993 did not have a material impact on the Company's results of operations. (2) Certain reclassifications have been made to the 1992 and 1993 consolidated financial statements to conform to the 1994 presentation. Such reclassifications had no effect on results of operations or stockholders' equity. ------------------------ As of March 31, 1995, the Company had remaining restructuring reserves of approximately $14.6 million relating to the phase down of its Fremont development facility and the phase out of its Milpitas manufacturing facility. During the second quarter, the Company determined to continue to operate its Milpitas facility and completed the phase down of the Fremont facility and, as a result, expects to significantly reduce such reserves during the quarter ending June 30, 1995. The Company also expects, however, that such reduction in reserves will be substantially offset by increases in its restructuring reserves for other corporate matters, including the $14.6 million jury verdict against the Company during the quarter ending June 30, 1995 in the Texas Instruments litigation. See "Risk Factors -- Intellectual Property and Texas Instruments Litigation." Accordingly, the Company does not expect that these events will have a material effect on its net income for the quarter ending June 30, 1995. 12 14 UNDERWRITING The Underwriters named below (the "Underwriters") have severally agreed, subject to the terms and conditions of the Underwriting Agreement (the form of which is filed as an exhibit to the Registration Statement of which this Prospectus is a part), to purchase from the Company, and the Company has agreed to sell to each Underwriter, the aggregate number of shares of Common Stock set forth opposite their respective names below:
NUMBER OF NAME SHARES ------------------------------------------------------------------ --------- Lehman Brothers Inc. ............................................. Merrill Lynch, Pierce, Fenner & Smith Incorporated......................................... Montgomery Securities............................................. Prudential Securities Incorporated................................ --------- Total................................................... 5,000,000 ========
The Underwriting Agreement provides that the obligations of the Underwriters to purchase shares of Common Stock are subject to certain conditions, and that if any of the foregoing shares of Common Stock are purchased by the Underwriters pursuant to the Underwriting Agreement, all shares of Common Stock agreed to be purchased by the Underwriters pursuant to the Underwriting Agreement must be so purchased. The Company has been advised that the Underwriters propose to offer the shares of Common Stock directly to the public initially at the public offering price set forth on the cover page of this Prospectus, and to certain selected dealers (who may include the Underwriters) at such public offering price less a concession not in excess of $ per share. The Underwriters may allow and the selected dealers may reallow a concession not in excess of $ per share to certain other brokers and dealers. After the public offering, the public offering price, the concession to selected dealers and the reallowance to other dealers may be changed by the Underwriters. The Company has granted to the Underwriters an option to purchase up to an additional 750,000 shares of Common Stock at the public offering price, less the aggregate underwriting discounts and commissions, shown on the cover page of this Prospectus, solely to cover over-allotments, if any. The option may be exercised at any time up to 30 days after the date of this Prospectus. To the extent that the Underwriters exercise such option, each of the Underwriters will be committed, subject to certain conditions, to purchase a number of option shares proportionate to such Underwriter's initial commitment. The Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act, or to contribute to payments that the Underwriters may be required to make in respect thereof. The Company has agreed that without the written consent of the Underwriters, it will not offer, sell, contract to sell or otherwise dispose of any shares of Common Stock or any securities, convertible or exchangeable therefor, for a period of 90 days from the date of this Prospectus, subject to limited exceptions. The Company's directors and executive officers, who collectively held as of March 14, 1995 an aggregate of 7,867,360 shares of Common Stock and options to purchase Common Stock, have agreed that without the consent of the Underwriters they will not offer, sell, contract to sell or otherwise dispose of any shares of Common Stock or any securities convertible into or exchangeable therefor for a period of 30 days from the date of this Prospectus. From time to time, certain of the Underwriters or their affiliates have provided, and may continue to provide, investment banking services to the Company. 13 15 LEGAL MATTERS The validity of the securities offered hereby will be passed upon for the Company by Wilson, Sonsini, Goodrich & Rosati, Professional Corporation ("WSGR"), Palo Alto, California, and for the Underwriters by Brobeck, Phleger & Harrison, Palo Alto, California. Larry W. Sonsini, a member of WSGR, is an Assistant Secretary of the Company. EXPERTS The consolidated financial statements incorporated in this Prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 1994, have been so incorporated in reliance on the report of Price Waterhouse LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. 14 16 - ------------------------------------------------------ - ------------------------------------------------------ No person has been authorized to give any information or to make any representations other than those contained in this Prospectus, and, if given or made, such information or representations must not be relied upon as having been authorized. This Prospectus does not constitute an offer to sell or the solicitation of an offer to buy any securities other than the securities to which it relates or an offer to sell or a solicitation of an offer to buy such securities in any circumstances in which such offer or solicitation is unlawful. Neither the delivery of this Prospectus nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since the date hereof or that the information contained herein is correct as of any time subsequent to its date. ------------------------ TABLE OF CONTENTS
PAGE ----- Available Information................... 2 Information Incorporated by Reference... 2 Prospectus Summary...................... 3 Risk Factors............................ 4 The Company............................. 7 Use of Proceeds......................... 9 Dividend Policy......................... 9 Price Range of Common Stock............. 9 Capitalization.......................... 10 Selected Consolidated Financial Data.... 11 Underwriting............................ 13 Legal Matters........................... 14 Experts................................. 14
- ------------------------------------------------------ - ------------------------------------------------------ - ------------------------------------------------------ - ------------------------------------------------------ 5,000,000 SHARES COMMON STOCK --------------------------- PROSPECTUS July , 1995 --------------------------- LEHMAN BROTHERS MERRILL LYNCH & CO. MONTGOMERY SECURITIES PRUDENTIAL SECURITIES INCORPORATED - ------------------------------------------------------ - ------------------------------------------------------ 17 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The following table sets forth the various costs and expenses payable by the Company, other than underwriting discounts and commissions, of the sale and distribution of the securities being registered. All of the amounts shown are estimates except the Securities and Exchange Commission registration fee, the NYSE listing fee and the NASD filing fee. SEC Registration Fee.............................................. $ 81,542 NASD Filing Fee................................................... 24,147 NYSE Listing Fee.................................................. 1,500 Blue Sky Fees and Expenses........................................ 10,000 Legal Fees and Expenses........................................... 80,000 Accounting Fees and Expenses...................................... 45,000 Printing.......................................................... 45,000 Transfer Agent and Registrar Fees................................. 5,000 Miscellaneous..................................................... 7,811 -------- Total........................................................... $300,000 ========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS The Company has the power, pursuant to Section 145 of the Delaware General Corporation Law, to limit the liability of directors to the Company for certain breaches of fiduciary duty and to indemnify its directors, officers and other persons for certain acts. Article 11 of the Company's Restated Certificate of Incorporation includes the following provision: "To the fullest extent permitted by the Delaware General Corporation Law, a director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. Neither any amendment nor repeal of this Article 11, nor the adoption of any provision of this Certificate of Incorporation inconsistent with this Article 11, shall eliminate or reduce the effect of this Article 11 in respect of any matter occurring, or any cause of action, suit or claim that, but for this Article 11, would accrue or arise, prior to such amendment, repeal or adoption of an inconsistent provision." Article VI of the Bylaws of the Company provides that the Company shall indemnify certain agents of the Company against judgments, fines, settlements and other expenses arising from such person's agency relationship with the Company provided that the standard of conduct set forth therein is met. The effect of Article VI is to require that the Company provide indemnification to such agents to the maximum extent permitted by the Delaware General Corporation Law. Agents covered by this indemnification provision include current and former directors and officers of the Company, as well as persons who serve at the request of the Company as directors, officers, employees or agents of another enterprise. In addition, the Company has entered into indemnification agreements with each of its directors and certain of its officers. The indemnification agreements are based on the provisions of Section 145 of the Delaware General Corporation Law and attempt to provide the directors and officers of the Company with the maximum indemnification allowed under Delaware law. In certain instances, they may result in an expansion of the substantive protection available to such individuals under the Restated Certificate of Incorporation and the Bylaws. The Company currently maintains directors' and officers' liability insurance. Reference is also made to Section 8 of the Underwriting Agreement contained in Exhibit 1.1 hereto, indemnifying officers and directors of the Registrant against certain liabilities. II-1 18 ITEM 16. EXHIBITS
EXHIBIT NUMBER DESCRIPTION ------ -------------------------------------------------------------------------- 1.1 Form of Underwriting Agreement between Registrant and Lehman Brothers, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Montgomery Securities and Prudential Securities Incorporated. 4.1 Preferred Shares Rights Agreement dated November 16, 1988.(1) 5.1 Opinion of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, regarding legality of securities being registered. 23.1 Consent of Price Waterhouse LLP (see page II-4). 23.2 Consent of Counsel (included in Exhibit 5.1). 24.1 Power of Attorney (see page II-3) 27.1 Financial Data Schedule
- --------------- (1) Incorporated by reference to exhibits filed with the Registrant's Form 8-A filed on November 21, 1988. ITEM 17. UNDERTAKINGS The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in the Registration Statement shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to provisions of the Company's Certificate of Incorporation and Bylaws, Delaware Corporation Law, the Underwriting Agreement or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered hereunder, the Registrant will, unless in the opinion of its counsel the question has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. The undersigned Registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act, the information omitted from the form of Prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of Prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of Prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-2 19 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant, LSI Logic Corporation, a corporation organized and existing under the law of the State of Delaware, 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 Milpitas, State of California, on the 26th day of June, 1995. LSI Logic Corporation By: WILFRED J. CORRIGAN ------------------------------------ Wilfred J. Corrigan, Chairman and Chief Executive Officer POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Wilfred J. Corrigan and David E. Sanders, jointly and severally, his attorneys-in-fact, each with power of substitution, for him in any and all capacities, to sign any amendments to this Registration Statement (including post-effective amendments), and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated:
SIGNATURE TITLE DATE - ------------------------------------- --------------------------------------- --------------- WILFRED J. CORRIGAN Chairman and Chief Executive Officer June 26, 1995 - ------------------------------------- (Principal Executive Officer) Wilfred J. Corrigan ALBERT A. PIMENTEL Senior Vice President, Finance and June 26, 1995 - ------------------------------------- Chief Financial Officer (Principal Albert A. Pimentel Financial Officer and Principal Accounting Officer) T.Z. CHU Director June 26, 1995 - ------------------------------------- T.Z. Chu MALCOLM R. CURRIE Director June 26, 1995 - ------------------------------------- Malcolm R. Currie JAMES H. KEYES Director June 26, 1995 - ------------------------------------- James H. Keyes R. DOUGLAS NORBY Director June 26, 1995 - ------------------------------------- R. Douglas Norby
II-3 20 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Prospectus constituting part of this Registration Statement on Form S-3 of our report dated January 26, 1995 appearing on page 21 of LSI Logic Corporation's Annual Report on Form 10-K for the year ended December 31, 1994. We also consent to the references to us under the headings "Experts" and "Selected Financial Data" in such Prospectus. However, it should be noted that Price Waterhouse LLP has not prepared or certified such "Selected Financial Data." PRICE WATERHOUSE LLP San Jose, California June 26, 1995 II-4 21 INDEX TO EXHIBITS
EXHIBIT NUMBER EXHIBITS - ------- 1.1 Form of Underwriting Agreement between Registrant and Lehman Brothers, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Montgomery Securities and Prudential Securities Incorporated 4.1 Preferred Shares Rights Agreement dated November 16, 1988.(1) 5.1 Opinion of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, regarding legality of securities being registered 23.1 Consent of Price Waterhouse LLP (see page II-4) 23.2 Consent of Counsel (included in Exhibit 5.1) 24.1 Power of Attorney (see page II-3)
- --------------- (1) Incorporated by reference to exhibits filed with the Registrant's Form 8-A filed on November 21, 1988. EX-1.1 2 UNDERWRITING AGREEMENT 1 Draft 6/26/95 5,000,000 SHARES LSI LOGIC CORPORATION COMMON STOCK UNDERWRITING AGREEMENT July , 1995 LEHMAN BROTHERS INC. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED MONTGOMERY SECURITIES PRUDENTIAL SECURITIES INCORPORATED c/o Lehman Brothers Inc. Three World Financial Center New York, New York 10285 Dear Sirs: LSI Logic Corporation, a Delaware corporation (the "Company"), proposes to sell 5,000,000 shares (the "Firm Stock") of the Company's common stock, par value $0.01 per share (the "Common Stock"). In addition, the Company proposes to grant to the Underwriters named in Schedule 1 hereto (the "Underwriters") an option to purchase up to an additional 750,000 shares of the Common Stock on the terms and for the purposes set forth in Section 2 (the "Option Stock"). The Firm Stock and the Option Stock, if purchased, are hereinafter collectively called the "Stock." This is to confirm the agreement concerning the purchase of the Stock from the Company by the Underwriters. 1. Representations, Warranties and Agreements of the Company. The Company represents, warrants and agrees that: (a) A registration statement on Form S-3 with respect to the Stock has (i) been prepared by the Company in conformity with the requirements of the United States Securities Act of 1933, as amended, (the "Securities Act") and the rules and regulations (the "Rules and Regulations") promulgated by the United States Securities and Exchange Commission (the "Commission") thereunder, (ii) been filed with the Commission under the Securities Act and (iii) become effective under the Securities Act. Copies of such registration statement and all amendments thereto have been delivered by the Company to you. As used in this Agreement, "Effective Time" means the date and the time as of which such registration statement, or the most recent post-effective amendment thereto, if any, was declared effective by the Commission; "Effective Date" means the date of the Effective Time; "Preliminary Prospectus" means each prospectus included in such registration statement, or amendments thereof, before it became effective under the Securities Act and any prospectus filed with the Commission by the Company with the consent of the Representatives pursuant to Rule 424(a) of the Rules and Regulations; "Registration Statement" means such registration statement, as amended at the Effective Time, including any documents incorporated by reference therein at such time and all information contained in the final prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations in accordance with Section 5(a) hereof and deemed to be a part of the registration statement as of the Effective Time pursuant to paragraph (b) of Rule 430A of the Rules and Regulations; and "Prospectus" means such final prospectus, as first filed with the Commission pursuant to paragraph (1) or (4) of Rule 424(b) of the Rules and Regulations. Reference made herein to any Preliminary Prospectus or to the 2 Prospectus shall be deemed to refer to and include any documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the date of such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any document filed under the United States Securities Exchange Act of 1934 (the "Exchange Act") after the date of such Preliminary Prospectus or the Prospectus, as the case may be, and incorporated by reference in such Preliminary Prospectus or the Prospectus, as the case may be. The Commission has not issued any order preventing or suspending the use of any Preliminary Prospectus. (b) The Registration Statement conforms, and the Prospectus and any further amendments or supplements to the Registration Statement or the Prospectus will, when they become effective or are filed with the Commission, as the case may be, conform in all material respects to the requirements of the Securities Act and the Rules and Regulations and do not and will not, as of the applicable effective date (as to the Registration Statement and any amendment thereto) and as of the applicable filing date (as to the Prospectus and any amendment or supplement thereto) 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; provided that no representation or warranty is made as to information contained in or omitted from the Registration Statement or the Prospectus in reliance upon and in conformity with written information furnished to the Company by or on behalf of any Underwriter specifically for inclusion therein. (c) The documents incorporated by reference in the Prospectus, when they became effective or were filed with the Commission, as the case may be, conformed in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances under which they were made; and any further documents so filed and incorporated by reference in the Prospectus, when such documents become effective or are filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and 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 in light of the circumstances under which they were made. (d) The Company and each of its Significant Subsidiaries (as defined in Section 15) have been duly incorporated and are validly existing as corporations in good standing under the laws of their respective jurisdictions of incorporation, are duly qualified to do business and are in good standing as foreign corporations in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Company and its subsidiaries taken as a whole, and have all corporate power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged. (e) The Company has an authorized capitalization as set forth in documents incorporated by reference in the Prospectus, and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and conform to the description thereof contained in the Prospectus; and all of the issued and outstanding shares of capital stock of each Significant Subsidiary of the Company have been duly and validly authorized and issued and are fully paid and non-assessable and are owned directly or indirectly by the Company in the percentages set forth on Schedule 1(e) hereof, free and clear of all liens, encumbrances, equities or claims. (f) The unissued shares of the Stock to be issued and sold by the Company to the Underwriters hereunder have been duly and validly authorized and, when issued and delivered against payment therefor as provided herein, will be duly and validly issued, fully paid and non-assessable; and the Stock will conform to the description thereof contained in documents incorporated by reference into the Prospectus. 2 3 (g) This Agreement has been duly authorized, executed and delivered by the Company and constitutes a valid and binding agreement of the Company enforceable against the Company in accordance with its terms, except as (i) the enforceability thereof may be limited by the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors' rights generally, and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability. (h) The execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any material indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its Significant Subsidiaries is a party or by which the Company or any of its Significant Subsidiaries is bound or to which any of the properties or assets of the Company or any of its Significant Subsidiaries is subject, nor will such actions result in any violation of the provisions of the charter or bylaws of the Company or any of its Significant Subsidiaries or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its Significant Subsidiaries or any of their properties or assets; and, except for the registration of the Stock under the Securities Act, and such consents, approvals, authorizations, registrations or qualifications as may be required under the Exchange Act and applicable state securities laws in connection with the purchase and distribution of the Stock by the Underwriters, no consent, approval, authorization or order of, or filing or registration with, any such court or governmental agency or body is required for the execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby. (i) There are no contracts, agreements or understandings, which have not been waived in connection with this transaction, between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant to the Registration Statement or in any securities being registered pursuant to any other registration statement filed by the Company under the Securities Act. (j) Except as described in the Prospectus or documents incorporated therein by reference, the Company has not sold or issued any shares of Common Stock during the six-month period preceding the date of the Prospectus, including any sales pursuant to Rule 144A under, or Regulations D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, stock options plans or other employee compensation plans or pursuant to outstanding options, rights or warrants. (k) Neither the Company nor any of its Significant Subsidiaries has sustained, since the date of the latest audited consolidated financial statements included or incorporated by reference in the Prospectus, any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus; and, since such date, there has not been any change in the capital stock, other than the reservation of the Stock and issuance of options and stock under employee benefit plans, or in long-term debt of the Company or any of its Significant Subsidiaries or any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus or the documents incorporated by reference therein. (l) The consolidated financial statements (including the related notes and supporting schedules) filed as part of the Registration Statement or included or incorporated by reference in the Prospectus present fairly the financial condition and results of operations of the entities purported to be shown thereby, at the dates and for the periods indicated, and have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods involved. 3 4 (m) Except as described in the Prospectus or the documents incorporated by reference therein, and except as would not result in any material adverse effect upon the business of the Company and its subsidiaries taken as a whole, the Company and each of its Significant Subsidiaries own or possess adequate rights to use all material patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights and licenses necessary for the conduct of their respective businesses as now conducted or as proposed to be conducted as described in the Prospectus or the documents incorporated by reference therein, and have no reason to believe that the conduct of their respective businesses as now conducted or as proposed to be conducted as described in the Prospectus or the documents incorporated by reference therein, will conflict with, and have not received any notice of any claim of conflict with, any such rights of others, except as the outcome of such claim of conflict would not result in any material adverse effect upon the Company and its subsidiaries taken as a whole. (n) The conditions for use of Form S-3, as set forth in the General Instructions thereto, have been satisfied. (o) There are no contracts or other documents which are required to be described in the Prospectus or filed as exhibits to the Registration Statement by the Securities Act or by the Rules and Regulations which have not been described in the Prospectus or filed as exhibits to the Registration Statement or incorporated therein by reference as permitted by the Rules and Regulations. (p) The Company has filed all federal, state and local income and franchise tax returns required to be filed through the date hereof and has paid all taxes shown thereon, as due and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does the Company have any knowledge of any tax deficiency which, if determined adversely to the Company or any of its subsidiaries, will have a material adverse effect on the consolidated financial position, stockholders' equity, results of operations, business or prospects of the Company and its subsidiaries, taken as a whole. (q) Since the date as of which information is given in the Prospectus through the date hereof, and except as may otherwise be disclosed in the Prospectus or documents incorporated by reference herein, the Company has not (i) issued or granted any securities except options and shares of common stock issued on exercise of options and stock purchase rights granted under the Company's stock option and benefit plans, (ii) incurred any liability or obligation, direct or contingent, other than liabilities and obligations which were incurred in the ordinary course of business, (iii) entered into any transaction not in the ordinary course of business or (iv) declared or paid any dividend on its capital stock. (s) The Company's directors and executive officers, who collectively held as of December 31, 1994 an aggregate of 3,882,030 shares of Common Stock and options to purchase Common Stock, have agreed that without the consent of the Underwriters they will not offer, sell, contract to sell or otherwise dispose of any shares of Common Stock or any securities convertible into or exchangeable therefor for a period of 30 days from the date of the Prospectus. 2. Purchase of the Stock by the Underwriters. On the basis of the representations and warranties contained in, and subject to the terms and conditions of, this Agreement, the Company agrees to sell 5,000,000 shares of the Firm Stock to the several Underwriters and each of the Underwriters, severally and not jointly, agrees to purchase the number of shares of the Firm Stock set opposite that Underwriter's name in Schedule 1 hereto. In addition, the Company grants to the Underwriters an option to purchase up to 750,000 shares of Option Stock. Such option is granted solely for the purpose of covering overallotments in the sale of Firm Stock and is exercisable as provided in Section 4 hereof. Shares of Option Stock shall be purchased severally for the account of the Underwriters in proportion to the number of shares of Firm Stock set opposite the name of such Underwriters in Schedule 1 hereto. The respective purchase obligations of each Underwriter with respect to the Option Stock shall be adjusted by the Underwriters so that no Underwriter shall be obligated to 4 5 purchase Option Stock other than in 100 share amounts. The price of both the Firm Stock and any Option Stock shall be $ per share. The Company shall not be obligated to deliver any of the Stock to be delivered on the First Delivery Date or the Second Delivery Date (as hereinafter defined), as the case may be, except upon payment for all the Stock to be purchased on such Delivery Date as provided herein. 3. Offering of Stock by the Underwriters. The several Underwriters propose to offer the Firm Stock for sale upon the terms and conditions set forth in the Prospectus. 4. Delivery of and Payment for the Stock. Delivery of and payment for the Firm Stock shall be made at the office of Wilson, Sonsini, Goodrich & Rosati, 650 Page Mill Road, Palo Alto, California 94304, at 10:00 A.M., New York City time, on the third full business day following the date of this Agreement, or the fourth full business day if permitted under Rule 15c6-1(c) of the Exchange Act, or at such other date or place as shall be determined by agreement between the Underwriters and the Company. This date and time are sometimes referred to as the First Delivery Date." On the First Delivery Date, the Company shall deliver or cause to be delivered certificates representing the Firm Stock to the Underwriters against payment to or upon the order of the Company of the purchase price by certified or official bank check or checks payable in New York Clearing House (next-day) funds. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. Upon delivery, the Firm Stock shall be registered in such names and in such denominations as the Underwriters shall request in writing not less than two full business days prior to the First Delivery Date. For the purpose of expediting the checking and packaging of the certificates for the Firm Stock, the Company shall make the certificates representing the Firm Stock available for inspection by the Underwriters in New York, New York, not later than 2:00 P.M., New York City time, on the business day prior to the First Delivery Date. At any time on or before the thirtieth day after the date of this Agreement the option granted in Section 2 may be exercised by written notice being given to the Company by the Underwriters. Such notice shall set forth the aggregate number of shares of Option Stock as to which the option is being exercised, the names in which the shares of Option Stock are to be registered, the denominations in which the shares of Option Stock are to be issued and the date and time, as determined by the Underwriters, when the shares of Option Stock are to be delivered; provided, however, that this date and time shall not be earlier than the First Delivery Date nor earlier than the second business day after the date on which the option shall have been exercised nor later than the third business day after the date on which the option shall have been exercised (the fourth full business day if permitted under Rule 15c6-1(c) of the Exchange Act). The date and time the shares of Option Stock are delivered are sometimes referred to as the "Second Delivery Date" and the First Delivery Date and the Second Delivery Date are sometimes each referred to as a "Delivery Date"). Delivery of and payment for the Option Stock shall be made at the place specified in the first sentence of the first paragraph of this Section 4 (or at such other place as shall be determined by agreement between the Representatives and the Company) at 10:00 A.M., New York City time, on the Second Delivery Date. On the Second Delivery Date, the Company shall deliver or cause to be delivered the certificates representing the Option Stock to the Underwriters against payment to or upon the order of the Company of the purchase price by certified or official bank check or checks payable in New York Clearing House (next-day) funds. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. Upon delivery, the Option Stock shall be registered in such names and in such denominations as the Underwriters shall request in the aforesaid written notice. For the purpose of expediting the checking and packaging of the certificates for the Option Stock, the Company shall make the certificates representing the Option Stock available for inspection by the Underwriters in New York, New York, not later than 2:00 P.M., New York City time, on the business day prior to the Second Delivery Date. 5 6 5. Further Agreements of the Company. The Company agrees: (a) To prepare the Prospectus in a form approved by the Underwriters and to file such Prospectus pursuant to Rule 424(b) under the Securities Act not later than Commission's close of business on the second business day following the execution and delivery of this Agreement or, if applicable, such earlier time as may be required by Rule 430A(a)(3) under the Securities Act; to make no further amendment or any supplement to the Registration Statement or to the Prospectus prior to the last Delivery Date except as permitted herein; to advise the Underwriters, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed and to furnish the Underwriters with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offering or sale of the Stock; to advise the Underwriters, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus, of the suspension of the qualification of the Stock for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or the Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal; (b) To furnish promptly to the Underwriters and to counsel for the Underwriters a signed copy of the Registration Statement as originally filed with the Commission, and each amendment thereto filed with the Commission, including all consents and exhibits filed therewith; (c) To deliver promptly to the Underwriters such number of the following documents as the Underwriters shall reasonably request: (i) conformed copies of the Registration Statement as originally filed with the Commission and each amendment thereto (in each case excluding exhibits other than this Agreement and the computation of per share earnings), (ii) each Preliminary Prospectus, the Prospectus and any amended or supplemented Prospectus and (iii) any document incorporated by reference in the Prospectus (excluding exhibits thereto); and, if the delivery of a prospectus is required at any time after the Effective Time in connection with the offering or sale of the Stock or any other securities relating thereto and if at such time any events shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Securities Act or the Exchange Act, to notify the Underwriters and to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Underwriters may from time to time reasonably request of an amended or supplemented Prospectus which will correct such statement or omission or effect such compliance. (d) To file promptly with the Commission any amendment to the Registration Statement or the Prospectus or any supplement to the Prospectus that may, in the judgment of the Company or the Underwriters, be required by the Securities Act or requested by the Commission; (e) Prior to filing with the Commission any amendment to the Registration Statement or supplement to the Prospectus, any document incorporated by reference in the Prospectus or any Prospectus pursuant to Rule 424 of the Rules and Regulations, to furnish a copy thereof to the Underwriters and counsel for the Underwriters and obtain the consent of the Underwriters to the filing; (f) As soon as practicable after the Effective Date to make generally available to the Company's security holders and to deliver to the Underwriters an earnings statement of the Company and its 6 7 subsidiaries (which need not be audited) complying with Section 11(a) of the Securities Act and the Rules and Regulations (including, at the option of the Company, Rule 158); (g) For a period of five years following the Effective Date, to furnish to the Underwriters copies of all materials furnished by the Company to its stockholders and all public reports and all reports and financial statements furnished by the Company to the principal national securities exchange upon which the Common Stock may be listed pursuant to requirements of or agreements with such exchange or to the Commission pursuant to the Exchange Act or any rule or regulation of the Commission thereunder; (h) Promptly from time to time to take such action as the Underwriters may reasonably request to qualify the Stock for offering and sale under the securities laws of such jurisdictions as the Underwriters may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Stock except where such qualification would require the Company to execute a general consent to service of process; (i) For a period of 90 days from the date of the Prospectus, not to offer for sale, sell or otherwise dispose of (or enter into any transaction which is designed to, or could be expected to, result in the disposition by any person of), directly or indirectly, any shares of common stock or preferred stock or any securities convertible into or exercisable or exchangeable for its common stock or preferred stock (including, but not limited to rights, options, and warrants) other than the Stock, shares and options issued pursuant to employee benefit plans, stock option plans or other employee compensation plans existing on the date hereof, and shares of Preferred Stock issued pursuant to the Rights (as defined in the Prospectus) without the prior written consent of the Underwriters; (j) Prior to the Effective Date, to apply for the listing of the Stock on the New York Stock Exchange, Inc. and to use its best efforts to complete that listing, subject only to official notice of issuance prior to the First Delivery Date; and (k) To apply the net proceeds from the sale of the Stock being sold by the Company as set forth in the Prospectus. 6. Expenses. The Company agrees to pay (a) the costs incident to the authorization, issuance, sale and delivery of the Stock and any taxes payable in that connection; (b) the costs incident to the preparation, printing and filing under the Securities Act of the Registration Statement and any amendments and exhibits thereto; (c) the costs of distributing the Registration Statement as originally filed and each amendment thereto and any post-effective amendments thereof (including, in each case, exhibits), any Preliminary Prospectus, the Prospectus and any amendment or supplement to the Prospectus or any document incorporated by reference therein, all as provided in this Agreement; (d) the costs of producing and distributing this Agreement and any other related documents in connection with the offering, purchase, sale and delivery of the stock; (e) the filing fees incident to securing any required review by the National Association of Securities Dealers, Inc. of the terms of sale of the Stock; (f) any applicable listing or other fees; (g) the fees and expenses of qualifying the Stock under the securities laws of the several jurisdictions as provided in Section 5(h) and of preparing, printing and distributing a Blue Sky Memorandum (including related fees and expenses of counsel to the Underwriters); and (h) all other costs and expenses incident to the performance of the obligations of the Company under this Agreement; provided that, except as provided in this Section 6 and in Section 11 the Underwriters shall pay their own costs and expenses, including the costs and expenses of their counsel, any transfer taxes on the Stock which they may sell and the expenses of advertising any offering of the Stock made by the Underwriters. 7. Conditions of Underwriters' Obligations. The respective obligations of the Underwriters hereunder are subject to the accuracy, when made and on each Delivery Date, of the representations and warranties of the Company contained herein, to the performance by the Company of its obligations hereunder, and to each of the following additional terms and conditions: (a) The Prospectus shall have been timely filed with the Commission in accordance with Section 5(a); no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the 7 8 Commission; and any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been complied with. (b) No Underwriter shall have discovered and disclosed to the Company on or prior to such Delivery Date that the Registration Statement or the Prospectus or any amendment or supplement thereto contains an untrue statement of a fact which, in the opinion of the Underwriters is material or omits to state a fact which is material and is required to be stated therein or is necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. (c) All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Stock, the Registration Statement and the Prospectus, and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be satisfactory in all respects to counsel for the Underwriters, and the Company shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters. (d) Wilson, Sonsini, Goodrich & Rosati shall have furnished to the Underwriters its written opinion, as counsel to the Company, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Underwriters, to the effect that: (i) The Company has been duly incorporated and is a validly existing corporation in good standing under the laws of its jurisdiction of incorporation and has all power and authority necessary to own or hold its properties and to conduct the business in which it is engaged; (ii) The Company has an authorized capitalization as set forth in the documents incorporated by reference into the Prospectus, and during the course of the due diligence investigation conducted by such counsel, nothing came to such counsel's attention which caused such counsel to believe that the issued shares of capital stock of the Company had not been duly and validly authorized and issued, or were not fully paid and nonassessable; (iii) There are no preemptive or other rights to subscribe for or to purchase, nor any restriction upon the voting or transfer of, any shares of the Stock pursuant to the Company's charter or by-laws or any agreement or other instrument listed as an exhibit to the Registration Statement or as an exhibit to any document incorporated by reference in the Prospectus; (iv) The Registration Statement was declared effective under the Securities Act as of the date and time specified in such opinion, the Prospectus was filed with the Commission pursuant to the subparagraph of Rule 424(b) of the Rules and Regulations specified in such opinion on the date specified therein and no stop order suspending the effectiveness of the Registration Statement has been issued and, to the knowledge of such counsel, no proceeding for that purpose is pending or threatened by the Commission; (v) The Registration Statement and the Prospectus and any further amendments or supplements thereto made by the Company prior to such Delivery Date (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Securities Act and the Rules and Regulations; and the documents incorporated by reference in the Prospectus and any further amendment or supplement to any such incorporated document made by the Company prior to such Delivery Date (other than the financial statements, schedules and other financial statistical data, as to which such counsel need express no opinion), when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects with the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder; (vi) To the best of such counsel's knowledge, there are no contracts or other documents which are required to be described in the Prospectus or filed as exhibits to the Registration Statement by the Securities Act or by the Rules and Regulations which have not been described or filed as exhibits 8 9 to the Registration Statement or incorporated therein by reference as permitted by the Rules and Regulations; (vii) This Agreement has been duly authorized, executed and delivered by the Company; and (viii) The issue and sale of the shares of Stock being delivered on such Delivery Date by the Company and the compliance by the Company with all of the provisions of this Agreement and the consummation of the transactions contemplated hereby will not conflict with or result in a breach or violation of any of the terms or provisions of the charter or by-laws of the Company or any statute or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of their properties or assets; and, except for the registration of the Stock under the Securities Act and such consents, approvals, authorizations, registrations or qualifications as may be required under the Exchange Act and applicable state securities laws in connection with the purchase and distribution of the Stock by the Underwriters, no consent, approval, authorization or order of, or filing or registration with, any such court or governmental agency or body is required for the execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby. In rendering such opinion, such counsel may state that its opinion is limited to matters governed by the Federal laws of the United States of America and the laws of the State of California and the General Corporation Law of Delaware. Such counsel shall also have furnished to the Underwriters a written statement, addressed to the Underwriters and dated such Delivery Date, in form and substance satisfactory to the Underwriters, to the effect that (x) such counsel has participated in conferences with the Underwriters and representatives of the Company and its auditors in connection with the preparation of the Registration Statement, and (y) based on the foregoing, no facts have come to the attention of such counsel which lead it to believe that (except for financial statements, schedules, and other statistical data as to which counsel need not express any opinion) (I) the Registration Statement, as of the Effective Date, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading in light of the circumstances under which they were made, or that the Prospectus contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading (II) any document incorporated by reference in the Prospectus or any further amendment or supplement to any such incorporated document made by the Company prior to such Delivery Date, when they became effective or were filed with the Commission as the case may be, contained, in the case of a registration statement which became effective under the Securities Act, any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein in light of the circumstances under which they were made not misleading, or, in the case of other documents which were filed under the Exchange Act with the Commission, an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The foregoing opinion and statement may be qualified by a statement to the effect that such counsel does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus. (e) Counsel to each of LSI Logic Europe plc, LSI Logic K.K., Nihon Semiconductor, Inc., LSI Logic Corporation of Canada, Inc., LSI Logic GmbH and LSI Logic S.A., shall have furnished to the Underwriters an opinion as counsel to such subsidiary, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Underwriters, to the effect that, with respect to each such subsidiary: (i) Such subsidiary is duly incorporated (as applicable) and validly existing as a corporation in good standing under the laws of the jurisdiction in which it is chartered or organized with full corporate power and authority to own its properties and conduct its business as presently conducted, and is duly qualified to do business and is in good standing in each jurisdiction in which the character 9 10 of the business conducted by it or the location of the properties owned or leased by it makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries taken as a whole; (ii) All outstanding shares of capital stock of such subsidiary have been duly authorized and issued and are fully paid and nonassessable. As of this date, shares of capital stock of such subsidiary were issued and outstanding, of which were issued to and owned by the Company. To the knowledge of such counsel, the shares of capital stock issued to the Company are owned free and clear of any security interest, claim, lien or encumbrance created by any statute, law or governmental regulation or authority; It is recognized and understood that the foregoing local opinion requirements will be modified as necessary or appropriate to adapt the legal concepts set forth therein to the comparable concepts as existing under the jurisprudence of the applicable jurisdiction and to conform to generally accepted local legal practices. (f) David E. Sanders shall have furnished to the Underwriters a written opinion, as general counsel to the Company, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Underwriters, to the effect that: (i) To such counsel's knowledge, the shares of capital stock of each of LSI Logic Europe plc, LSI Logic K.K., Nihon Semiconductor, Inc., LSI Logic Corporation of Canada, Inc., LSI Logic GmbH and LSI Logic S.A. issued to the Company are owned free and clear of any security interest, claim, lien or encumbrance created by the Company; (ii) To such counsel's knowledge and other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property or assets of the Company or any of its subsidiaries is the subject which would require disclosure in the Prospectus; and, to such counsel's knowledge, no such proceedings are overtly threatened in writing by governmental authorities or by others; (iii) The Company is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction in which its ownership or lease of property or the conduct of its business requires such qualification (other than those jurisdictions in which the failure to so qualify would not have a material adverse effect on the Company and its subsidiaries taken as a whole); (iv) To such counsel's knowledge, there are no contracts or other documents which are described in the Prospectus or required to be filed as exhibits to the Registration Statement or any filing by the Company under the Exchange Act or by the Exchange Act or the Rules and Regulations which have not been so described or filed or incorporated therein by reference as permitted by the Exchange Act or the Rules and Regulations; (v) The issue and sale of the shares of Stock being delivered on such Delivery Date by the Company and the compliance by the Company with all of the provisions of this Agreement and the consummation of the transactions contemplated hereby will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under any document listed as an exhibit to the Registration Statement or incorporated by reference into the Prospectus; and (vi) All of the issued shares of capital stock of the Company have been duly and validly authorized and issued, and are fully paid and nonassessable and conform to the description thereof contained in the Prospectus. In rendering such opinion, such counsel may state that his opinion is limited to matters governed by the Federal laws of the United States of America, the laws of the State of California and the General Corporation Law of Delaware. (g) The Underwriters shall have received from Brobeck, Phleger & Harrison, counsel for the Underwriters, such opinion or opinions, dated such Delivery Date, with respect to the issuance and sale of 10 11 the Stock, the Registration Statement, the Prospectus and other related matters as the Underwriters may reasonably require, and the Company shall have furnished to such counsel such documents as they reasonably request for the purpose of enabling them to pass upon such matters. (h) At the time of execution of this Agreement, the Underwriters shall have received from Price Waterhouse a letter, in form and substance satisfactory to the Underwriters, addressed to the Underwriters and dated the date hereof (i) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the date hereof (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Prospectus, as of a date not more than five days prior to the date hereof), the conclusions and findings of such firm with respect to the financial information and other matters ordinarily covered by accountants' "comfort letters" to underwriters in connection with registered public offerings. (i) With respect to the letter of Price Waterhouse referred to in the preceding paragraph and delivered to the Underwriters concurrently with the execution of this Agreement (the "initial letter"), the Company shall have furnished to the Underwriters a letter (the "bring-down letter") of such accountants, addressed to the Underwriters and dated such Delivery Date (i) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the bring-down letter (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Prospectus, as of a date not more than five days prior to the date of the bring-down letter), the conclusions and findings of such firm with respect to the financial information and other matters covered by the initial letter and (iii) confirming in all material respects the conclusions and findings set forth in the initial letter. (j) The Company shall have furnished to the Underwriters a certificate, dated such Delivery Date, of its Chairman of the Board, its President or a Vice President and its Chief Financial Officer stating that: (i) The representations, warranties and agreements of the Company in Section 1 are true and correct as of such Delivery Date; the Company has complied with all its agreements contained herein; and the conditions set forth in Sections 7(a) and 7(k) have been fulfilled; and (ii) They have carefully examined the Registration Statement and the Prospectus and, in their opinion (A) as of the Effective Date, the Registration Statement and Prospectus did not include any untrue statement of a material fact and did not 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, and (B) since the Effective Date no event has occurred which should have been set forth in a supplement or amendment to the Registration Statement or the Prospectus. (k) (i) Neither the Company nor any of its Significant Subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus or (ii) since such date there shall not have been any change in the capital stock other than shares issued pursuant to employee benefit plans, stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants, or in long-term debt of the Company or any of its subsidiaries or any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus. (l) Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the following: (i) trading in securities generally on the New York Stock Exchange or the American Stock 11 12 Exchange or in the over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market, shall have been suspended or minimum prices shall have been established on any such exchange or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction, (ii) a banking moratorium shall have been declared by Federal or state authorities, (iii) the United States shall have become engaged in hostilities, there shall have been an escalation in hostilities involving the United States or there shall have been a declaration of a national emergency or war by the United States or (iv) there shall have occurred such a material adverse change in general economic, political or financial conditions (or the effect of international conditions on the financial markets in the United States shall be such) as to make it, in the judgment of a majority in interest of the several Underwriters, impracticable or inadvisable to proceed with the public offering or delivery of the Stock being delivered on such Delivery Date on the terms and in the manner contemplated in the Prospectus. (m) The New York Stock Exchange shall have approved the Stock for listing subject only to official notice of issuance. All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters. 8. Indemnification and Contribution. (a) The Company shall indemnify and hold harmless each Underwriter, its officers and employees and each person, if any, who controls any Underwriter within the meaning of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of Stock), to which that Underwriter, officer, employee or controlling person may become subject, under the Securities Act, Exchange Act, or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Registration Statement or the Prospectus or in any amendment or supplement thereto filed with the Commission or (ii) the omission or alleged omission to state therein a material fact or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and shall reimburse each Underwriter and each such officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by that Underwriter, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, the Registration Statement or the Prospectus or in any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by or on behalf of any Underwriter specifically for inclusion therein and provided further that as to any Preliminary Prospectus this indemnity agreement shall not inure to the benefit of any Underwriter, its officer or employee, or any person controlling that Underwriter on account of any loss, claim, damage, liability or action arising from the sale of Stock to any person by that Underwriter if that Underwriter failed to send or give a copy of the Prospectus (as the same may then be amended or supplemented if the Company shall have furnished such amendment or supplement), to that person asserting such loss, claim, damage, liability or action, and the untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a 12 13 material fact in such Preliminary Prospectus was corrected in the Prospectus, unless such failure resulted from non-compliance by the Company with Section 5(b) or 5(c). The foregoing indemnity agreement is in addition to any liability which the Company may otherwise have to any Underwriter or to any officer, employee or controlling person of that Underwriter. (b) Each Underwriter, severally and not jointly, shall indemnify and hold harmless the Company, each of its directors, each of its officers who signed the Registration Statement and each person, if any, who controls the Company within the meaning of the Securities Act or Exchange Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof, to which the Company or any such director, officer or controlling person may become subject, under the Securities Act, Exchange Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Registration Statement or the Prospectus or in any amendment or supplement thereto filed with the Commission or (ii) the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements in light of the circumstances under which they were made therein not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company through the Underwriters by or on behalf of that Underwriter specifically for inclusion therein, and shall reimburse through the Underwriters the Company and any such director, officer or controlling person for any legal or other expenses reasonably incurred by the Company or any such director, officer or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred. The foregoing indemnity agreement is in addition to any liability which any Underwriter may otherwise have to the Company or any such director, officer or controlling person. (c) Promptly after receipt by an indemnified party under this Section 8 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the claim or the commencement of that action; provided, however, that the failure to notify the indemnifying party shall not relieve it from any liability which it may have under this Section 8 except to the extent it has been materially prejudiced by such failure and, provided further, that the failure to notify the indemnifying party shall not relieve it from any liability which it may have to an indemnified party otherwise than under this Section 8. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assure the defense thereof with counsel satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section 8 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs or investigation; provided, however, that any indemnified party shall have the right to employ separate counsel in any such action and to participate in the defense thereof but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the employment thereof has been specifically authorized by the indemnifying party in writing, (ii) such indemnified party shall have been advised by such counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the indemnifying party and in the reasonable judgment of such counsel it is advisable for such indemnified party to employ separate counsel or (iii) the indemnifying party has failed to assume the defense of such action and employ counsel reasonably satisfactory to the indemnified party, in which case, if such indemnified party notifies the indemnifying party in writing that it elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such action on behalf of such indemnified party, it being understood, however, that the indemnifying party shall not, in connection with any one such action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees 13 14 and expenses of more than one separate firm of attorneys at any time for all such indemnified parties, which firm shall be designated in writing by the Underwriters, if the indemnified parties under this Section 8 consist of any Underwriter or any of their respective controlling persons, or by the Company, if the indemnified parties under this Section consist of the Company or any of the Company's directors, officers or controlling persons. Each indemnified party, as a condition of the indemnity agreements contained in this Section 8 shall use its best efforts to cooperate with the indemnifying party in the defense of any such action or claim. No indemnifying party shall be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with its written consent or if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss of liability by reason of such settlement or judgment. (d) If the indemnification provided for in this Section 8 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Stock 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 Company on the one hand and the Underwriters on the other with respect to the statements or omissions which resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other with respect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Stock purchased under this Agreement (before deducting expenses) received by the Company on the one hand, and the total underwriting discounts and commissions received by the Underwriters with respect to the shares of the Stock purchased under this Agreement, on the other hand, bear to the total gross proceeds from the offering of the shares of the Stock under this Agreement, in each case as set forth in the table on the cover page of the Prospectus. The relative fault shall be determined by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 8 were to be determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section 8 shall be deemed to include, for purposes of this Section 8(d), any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8(d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Stock underwritten by it and distributed to the public was offered to the public exceeds the amount of any damages which such Underwriter has otherwise paid or become liable to pay by reason of any untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations to contribute as provided in this Section 8(d) are several in proportion to their respective underwriting obligations and not joint. No party shall be liable for contribution with respect to any action or claim settled without its consent; provided, however, that such consent shall not be unreasonably withheld. (e) The Underwriters severally confirm that the statements with respect to the public offering of the Stock set forth on the cover page of, and under the caption "Underwriting" in, the Prospectus are correct 14 15 and constitute the only information furnished in writing to the Company by or on behalf of the Underwriters specifically for inclusion in the Registration Statement and the Prospectus. 9. Defaulting Underwriters. If, on either Delivery Date, any Underwriter defaults in the performance of its obligations under this Agreement, the remaining non-defaulting Underwriters shall be obligated to purchase the Stock which the defaulting Underwriter agreed but failed to purchase on such Delivery Date in the respective proportions which the number of shares of the Firm Stock set opposite the name of each remaining non-defaulting Underwriter in Schedule 1 hereto bears to the total number of shares of the Firm Stock set opposite the names of all the remaining non-defaulting Underwriters in Schedule 1 hereto. Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company for damages caused by its default. If other underwriters are obligated or agree to purchase the Stock of a defaulting or withdrawing Underwriter, either the Underwriters or the Company may postpone the Delivery Date for up to seven full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Underwriters may be necessary in the Registration Statement, the Prospectus or in any other document or arrangement. 10. Termination. The obligations of the Underwriters hereunder may be terminated by the Underwriters by notice given to and received by the Company prior to delivery of and payment for the Firm Stock if, prior to that time, any of the events described in Sections 7(k) or 7(l), shall have occurred or if the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement. 11. Reimbursement of Underwriters' Expenses. If (a) the Company shall fail to tender the Stock for delivery to the Underwriters for any reason permitted under this Agreement or (b) the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement (including the termination of this Agreement pursuant to Section 10, the Company shall reimburse the Underwriters for the reasonable fees and expenses of their counsel and for such other out-of-pocket expenses as shall have been incurred by them in connection with this Agreement and the proposed purchase of the Stock, and upon demand the Company shall pay the full amount thereof to the Underwriters. 12. Notices, etc. All statements, requests, notices and agreements hereunder shall be in writing, and: (a) if to the Underwriters, shall be delivered or sent by mail, telex or facsimile transmission to Lehman Brothers Inc., Three World Financial Center, New York, New York 10285, Attention: Syndicate Department (Fax: 212-528-8822), with a copy, in the case of any notice pursuant to Section 8(d), to the Director of Litigation, Office of the General Counsel, Lehman Brothers Inc., 2 World Trade Center, 15th Floor, New York, NY 10048; (b) if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Registration Statement, Attention: David E. Sanders, General Counsel (Fax: 408-433-6896), Any such statements, requests, notices or agreements shall take effect at the time of receipt thereof. The Company shall be entitled to act and rely upon any request, consent, notice or agreement given or made on behalf of the Underwriters by Lehman Brothers Inc. on behalf of the Underwriters. 13. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the Underwriters, the Company, and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (A) the representations, warranties, indemnities and agreements of the Company contained in this Agreement shall also be deemed to be for the benefit of the person or persons, if any, who control any Underwriter within the meaning of Section 15 of the Securities Act and (B) the indemnity agreement of the Underwriters contained in Section 8(c) of this Agreement shall be deemed to be for the benefit of directors of the Company, officers of the Company who have signed the Registration Statement and any person controlling the Company within the meaning of Section 15 of the Securities Act. Nothing in this Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section 13, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. 15 16 14. Survival. The respective indemnities, representations, warranties and agreements of the Company and the Underwriters contained in this Agreement or made by or on behalf on them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the Stock and shall remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them. 15. Definition of the Terms "Business Day" and "Significant Subsidiary". For purposes of this Agreement, (a) "business day" means any day on which the New York Stock Exchange, Inc. is open for trading and (b) "Significant Subsidiary" shall mean each of LSI Logic Europe plc, LSI Logic K.K., Nihon Semiconductor, Inc., LSI Logic Corporation of Canada, Inc., LSI Logic GmbH and LSI Logic S.A. 16. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of New York. 17. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument. 18. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement. If the foregoing correctly sets forth the agreement between the Company and the Underwriters, please indicate your acceptance in the space provided for that purpose below. Very truly yours, LSI LOGIC CORPORATION By Albert A. Pimentel Senior Vice President, Finance and Chief Financial Officer Accepted: LEHMAN BROTHERS INC. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED MONTGOMERY SECURITIES PRUDENTIAL SECURITIES INCORPORATED By LEHMAN BROTHERS INC. By Michael S. Wishart Managing Director 16 17 SCHEDULE 1
NUMBER OF UNDERWRITERS SHARES - -------------------------------------------------------------------------------- --------- Lehman Brothers Inc. ........................................................... Merrill Lynch, Pierce, Fenner & Smith Incorporated....................................................... Montgomery Securities........................................................... Prudential Securities Incorporated.............................................. --------- Total................................................................. 5,000,000 ==========
17 18 SCHEDULE 1(E) LIST OF SUBSIDIARIES
JURISDICTION OF DIRECT/INDIRECT NAME OF SUBSIDIARY INCORPORATION OWNERSHIP - ---------------------------------------------------------- --------------- --------------- LSI Logic Europe plc...................................... United Kingdom 98% LSI Logic Corporation of Canada, Inc...................... Canada 56% LSI Logic K.K............................................. Japan 78% Nihon Semiconductor, Inc.................................. Japan 100% LSI Logic GmbH............................................ Germany 98% LSI Logic S.A............................................. France 98%
18 EX-5.1 3 CONSENT OF WILSON SONSINI 1 EXHIBIT 5.1 Wilson, Sonsini, Goodrich & Rosati Professional Corporation 650 Page Mill Road Palo Alto, California 94304 June 26, 1995 LSI Logic Corporation 1551 McCarthy Boulevard Milpitas, CA 95035 Re: Registration Statement on Form S-3 Ladies and Gentlemen: We have examined the Registration Statement on Form S-3 to be filed by LSI Logic Corporation (the "Company") with the Securities and Exchange Commission (the "Commission") on June 27, 1995 (as such may be further amended or supplemented, the "Registration Statement"), in connection with the registration under the Securities Act of 1933, as amended, of 5,750,000 shares of the Company's Common Stock (the "Shares"). The Shares, which include up to 750,000 shares of Common Stock issuable pursuant to an over-allotment option granted to the underwriters (the "Underwriters"), are to be sold to the Underwriters as described in such Registration Statement for sale to the public. As counsel to the Company in connection with this transaction, we have examined the proceedings taken and are familiar with the proceedings proposed to be taken by the Company in connection with the issuance and sale of the Shares. Based on the foregoing, it is our opinion that, upon conclusion of the proceedings being taken or contemplated by us, as your counsel, to be taken prior to the issuance of the Shares and upon completion of the proceedings taken in order to permit such transactions to be carried out in accordance with the securities laws of various states where required, the Shares, when issued and sold in the manner described in the Registration Statement, will be legally and validly issued, fully paid and nonassessable. We consent to the use of this opinion as an exhibit to the Registration Statement and any related short-form Registration Statement filed to register additional securities ("Short-form Registration Statement"), and further consent to the use of our name wherever appearing in the Registration Statement and any Short-form Registration Statement, including the prospectus constituting a part thereof, and any amendment thereto, which has been approved by us. Very truly yours, WILSON, SONSINI, GOODRICH & ROSATI Professional Corporation -----END PRIVACY-ENHANCED MESSAGE-----