-----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, pgol9qC6CRxm5IdErswRjKXL32dK8iqpNO9Tk2M/uBS2ylrHQrEHFVN1OlvX7Y3j oQIgWX78tTwetLOyPBZbJw== 0000912057-94-000995.txt : 19940323 0000912057-94-000995.hdr.sgml : 19940323 ACCESSION NUMBER: 0000912057-94-000995 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 19940322 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONAL SEMICONDUCTOR CORP CENTRAL INDEX KEY: 0000070530 STANDARD INDUSTRIAL CLASSIFICATION: 3674 IRS NUMBER: 952095071 STATE OF INCORPORATION: DE FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: S-3 SEC ACT: 33 SEC FILE NUMBER: 033-52775 FILM NUMBER: 94517150 BUSINESS ADDRESS: STREET 1: 2900 SEMICONDUCTORS DR STREET 2: PO BOX 58090 CITY: SANTA CLARA STATE: CA ZIP: 95052 BUSINESS PHONE: 4087215000 S-3 1 FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 22, 1994 REGISTRATION NO. 33- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------------ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ NATIONAL SEMICONDUCTOR CORPORATION (Exact name of Registrant as specified in its charter) DELAWARE 95-2095071 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number)
2900 SEMICONDUCTOR DRIVE P.O. BOX 58090 SANTA CLARA, CALIFORNIA 95052-8090 (Address, including zip code, of Registrant's principal executive offices) Registrant's telephone number including area code: (408) 721-5000 ------------------------------ JOHN M. CLARK, III, ESQ. SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY NATIONAL SEMICONDUCTOR CORPORATION 2900 SEMICONDUCTOR DRIVE, P.O. BOX 58090 SANTA CLARA, CALIFORNIA 95052-8090 (408) 721-5000 (Name, address, including zip code, and telephone number, including area code, of agent for service of process) ------------------------------ COPIES OF COMMUNICATIONS TO: PETER F. KERMAN, Esq. ROBERT B. KNAUSS, Esq. Latham & Watkins Munger, Tolles & Olson 505 Montgomery Street, Suite 1900 355 South Grand Avenue, 35th Floor San Francisco, California 94111-2562 Los Angeles, California 90071 (415) 391-0600 (213) 683-9100
------------------------------ 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. /X/ ------------------------------ CALCULATION OF REGISTRATION FEE
TITLE OF EACH CLASS PROPOSED MAXIMUM PROPOSED MAXIMUM OF SECURITIES TO AMOUNT TO OFFERING PRICE AGGREGATE OFFERING AMOUNT OF BE REGISTERED BE REGISTERED PER SHARE (1) PRICE (1) REGISTRATION FEE Common Stock, $0.50 par value.......... 8,250,000 shares (2) $22.6875 $187,171,875 $64,542 Preferred Stock Purchase Rights.......... (3) -- -- --
(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) on the basis of the average of the high and low prices of the Registrant's common stock as reported on the New York Stock Exchange Composite Transactions on March 15, 1994. (2) The maximum number of shares issuable on conversion of the 2,500,000 shares of the Registrant's Depositary Convertible Exchangeable Preferred Shares. (3) Each share of Common Stock includes one Preferred Stock Purchase Right issued under the Rights Agreement, dated as of August 8, 1988, as amended, between the Registrant and The First National Bank of Boston, as Rights Agent. ------------------------------ 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, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SUCH SECTION 8(A), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PROSPECTUS 8,250,000 SHARES NATIONAL SEMICONDUCTOR CORPORATION COMMON STOCK (PAR VALUE $0.50 PER SHARE) This prospectus relates to the issuance of a maximum of 8,250,000 shares of Common Stock, $0.50 par value (the "Common Stock"), of National Semiconductor Corporation, a Delaware corporation (the "Company"), either (i) upon conversion of its Depositary Convertible Exchangeable Preferred Shares (the "Depositary Shares"), each representing ownership of 1/10 of a share of the $40.00 Convertible Exchangeable Preferred Shares (the "Preferred Shares") of the Company or (ii) to Salomon Brothers Inc (the "Purchaser") under the standby arrangements described herein and the resale by the Purchaser of such Common Stock. The Company has called all of the Preferred Shares for redemption on April 21, 1994 (the "Redemption Date") at a redemption price equivalent to $50.80 per Depositary Share, plus accrued dividends from March 1, 1994 to the Redemption Date of $0.57 per share, for a total redemption price of $51.37 per share (the "Redemption Price"). No dividends will accrue on the Depositary Shares from and after the Redemption Date. The Depositary Shares are convertible prior to 5:00 p.m. Eastern Daylight Time on April 21,1994 at the rate of 3.30 shares of Common Stock for each Depositary Share. Cash will be paid in lieu of any fractional shares of Common Stock. No payment or adjustment will be made for dividends accrued on Depositary Shares surrendered for conversion. The Company has made arrangements with the Purchaser to purchase such number of shares of Common Stock as would have been issuable upon conversion of the Depositary Shares which have not been surrendered for conversion prior to 5:00 p.m. Eastern Daylight Time on April 21, 1994. The Purchaser may also purchase Depositary Shares in the open market or otherwise prior to April 21, 1994, and any Depositary Shares so purchased will be converted into Common Stock. See "Standby Arrangements" for a description of the Purchaser's compensation and indemnification arrangements with the Company. The Common Stock is traded on the New York Stock Exchange under the symbol NSM. On March 18, 1994, the last reported sales price of the Common Stock on such exchange was $23 5/8 per share. THE CONVERTIBILITY OF THE DEPOSITARY SHARES WILL EXPIRE AT 5:00 P.M. EASTERN DAYLIGHT TIME ON APRIL 21, 1994. SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF COMMON STOCK. Under the foregoing alternatives, a holder of Depositary Shares (a "Holder") who converted such Depositary Shares on March 18, 1994 would have received Common Stock (including cash in lieu of any fractional share) having a market value of $77.96, based on the last reported sales price of the Common Stock on the New York Stock Exchange on that date. As long as the market price of the Common Stock remains at least $15.57 per share, Holders who elect to convert will receive upon conversion Common Stock (plus cash in lieu of any fractional share) having a current market value greater than the $51.37 in cash which would be received if such Depositary Share were surrendered for redemption. It should be noted, however, that the price of the Common Stock received upon conversion will fluctuate in the market, and that Holders may incur various expenses of sale if such Common Stock is sold. 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. On or before the close of business on April 21, 1994, the Purchaser may offer to the public Common Stock, including shares acquired through the purchase and conversion of the Depositary Shares, at prices set from time to time by the Purchaser. It is intended that each such price when set will not exceed the greater of the last sale and current asked price of the Common Stock on the New York Stock Exchange, plus the amount of any concession to dealers, and it is intended that an offering price set on any calendar day will not be increased more than once during such day. After the close of business on April 21, 1994, the Purchaser may offer Common Stock at a price or prices to be determined, but which it is presently intended will be determined in conformity with the preceding sentence. The Purchaser may thus realize profits or losses independent of the compensation referred to under "Standby Arrangements." Any Common Stock will be offered by the Purchaser when, as and if accepted by the Purchaser and subject to its right to reject orders in whole or in part. This Prospectus covers the issuance of a maximum of 8,250,000 shares of Common Stock to be issued directly or upon conversion of the Depositary Shares and the resale of any such shares acquired by the Purchaser. - ------------------------------------------------------------------------ SALOMON BROTHERS INC - ---------------------------------------------------------------- The date of this Prospectus is March 22, 1994. IN CONNECTION WITH THIS OFFERING, THE PURCHASER MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK, THE DEPOSITARY SHARES AND THE DEPOSITARY SHARES EVIDENCING THE COMPANY'S $32.50 CONVERTIBLE PREFERRED STOCK AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, THE PACIFIC STOCK EXCHANGE OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. AVAILABLE INFORMATION National Semiconductor Corporation ("National" or the "Company") is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Reports, proxy statements and other information filed by the Company can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of the Commission: Chicago Regional Office, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511, and New York Regional Office, 7 World Trade Center, 13th Floor, New York, New York 10048. Copies of such material can be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. Such material can also be inspected and copied at the offices of the New York Stock Exchange, Inc. (the "NYSE"), 20 Broad Street, New York, New York 10005 and the Pacific Stock Exchange, Inc., 301 Pine Street, San Francisco, California 94104. This Prospectus constitutes a part of a registration statement on Form S-3 (together with all amendments and exhibits, herein referred to as the "Registration Statement") filed by the Company under the Securities Act of 1933, as amended (the "Securities Act"). This Prospectus does not contain all of the information included in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. Reference is made to such Registration Statement and to the exhibits relating thereto for further information with respect to the Company and the securities offered hereby. ------------------------ INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed by the Company with the Commission pursuant to the Exchange Act are incorporated in and made a part of this Prospectus by reference: (a) The Company's Annual Report on Form 10-K for the fiscal year ended May 30, 1993, including the portions of the Company's 1993 Annual Report and the Company's Proxy Statement for the 1993 Annual Meeting of Stockholders incorporated therein by reference; (b) The Company's Quarterly Report on Form 10-Q for the fiscal quarters ended August 29, 1993, November 28, 1993 and February 27, 1994; (c) The description of the Common Stock contained in the Company's Registration Statement on Form 8-A filed September 8, 1970; and (d) The description of the Preferred Stock Purchase Rights contained in the Company's Registration Statement on Form 8-A filed August 9, 1988. All documents filed by National pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and before the termination of the offering made by this Prospectus shall be deemed to be incorporated by reference in this Prospectus and to be a part hereof from the date of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein, or contained in this Prospectus, shall be deemed to be modified or superseded for purposes of 2 this Prospectus to the extent that a statement contained herein or in any other subsequently filed document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. National will furnish without charge to each person to whom this Prospectus is delivered, on written or oral request of such person, a copy of any or all documents incorporated by reference in this Prospectus, without exhibits to such documents (unless such exhibits are specifically incorporated by reference into such documents). Requests for such copies should be directed to: Investor Relations, Mail Stop 10-397, National Semiconductor Corporation, 2900 Semiconductor Drive, P.O. Box 58090, Santa Clara, California 95052-8090, telephone: (408) 721-5693. THE COMPANY National designs, develops, manufactures and markets a broad line of semiconductor products, including analog, digital and mixed-signal integrated circuits. National's principal executive offices are located at 2900 Semiconductor Drive, P.O. Box 58090, Santa Clara, California 95052-8090 and its telephone number is (408) 721-5000. RISK FACTORS In addition to the other information in this Prospectus, the following factors should be considered carefully in evaluating the Company and its business before purchasing the Common Stock offered by this Prospectus. FLUCTUATIONS IN FINANCIAL RESULTS The Company's financial results are affected by the business cycles and seasonal trends of the semiconductor and related industries. Shifts in product mix toward, or away from, higher margin products can also have a significant impact on the Company's operating results. As a result of these, and other factors, the Company's financial results can fluctuate significantly from period to period. As an example, the Company has generated net profits in the last ten quarters, but it experienced substantial losses in fiscal years 1989 through 1992. THE SEMICONDUCTOR INDUSTRY; COMPETITION The semiconductor industry is characterized by rapid technological change and frequent introduction of new technology leading to more complex and powerful products. The result is a cyclical environment with short product life-cycles, price erosion and high sensitivity to the overall business conditions. In addition, substantial capital and research and development investment is required for products and processes. The Company may experience periodic fluctuations in its operating results because of industry-wide conditions. National competes with a number of major companies in the high-volume segment of the industry. These include several companies whose semiconductor business is only part of their overall operations, such as Motorola, Inc., Hitachi, Ltd., Nippon Electric Company, Ltd. and Texas Instruments Incorporated, each of which has substantially greater financial resources than the Company. National also competes with a large number of smaller companies that target particular niche markets. FOREIGN OPERATIONS National conducts a substantial portion of its operations outside the United States and its business is subject to risks associated with many factors beyond its control, such as fluctuations in foreign currency rates, instability of foreign economies and governments, and changes in U.S. and foreign laws and policies affecting trade and investment. Although the Company has not experienced any materially 3 adverse effects with respect to its foreign operations arising from such factors, there can be no assurance that such problems will not arise in the future. In addition, although the Company seeks to hedge its exposure to currency exchange rate fluctuations, the Company's competitive position relative to non-U.S. suppliers can be affected by the exchange rate of the U.S. dollar against other currencies. TAX LITIGATION The Company has received Notices of Deficiency from the United States Internal Revenue Service (the "IRS") for the fiscal years ended May 31, 1976 through 1982. The Company and the IRS have reached a settlement on all disputed issues except for the issue of inter-company product transfer prices; this settlement has reduced the total of the additional taxes being sought to approximately $52 million (exclusive of interest). Trial was held in February 1993, briefs were filed in June 1993 and rebuttal briefs were filed in August 1993; however, the Company is not able to predict when a decision will be rendered. As a result of the length of time which has elapsed since the fiscal years in question as well as the effect of compounding, the amount of interest on any tax liability ultimately determined to be owing would be several times the amount of the underlying additional tax. The Company's tax returns for fiscal 1983 through 1989 have been under examination by the IRS, and the Company expects the IRS to raise similar issues. In January 1994, the Company and the IRS settled all issues for fiscal years 1983 through 1985, including issues relating to intercompany product transfer pricing, without the payment of additional federal tax. This result will be affected by certain net operating loss carryovers and credits, which will not be determined until a final decision is rendered in the litigation pending in the U.S. Tax Court. The Company's tax returns for fiscal years 1986 through 1989 are still under examination by the IRS. The Company believes that adequate tax payments have been made and accruals recorded for all years. 4 USE OF PROCEEDS The net proceeds from the sale of Common Stock to the Purchaser pursuant to the agreement described under "Standby Arrangements" will be used to fund the redemption of any Depositary Shares not tendered for conversion. Any excess net proceeds, resulting from the Purchaser remitting certain amounts to the Company (see "Standby Arrangements"), will be used for general corporate purposes and, pending such uses, are anticipated to be invested in short-term investments. PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY The Common Stock is listed and traded on the NYSE and the Pacific Stock Exchange. The following table sets forth, for the periods indicated, the high and low sales prices per share of the Common Stock, as reported on the NYSE Composite Transactions Tape.
FISCAL YEAR HIGH LOW - ------------------------------------------------------------------------------------------------ ----------- ----------- 1992: First Quarter................................................................................. $ 73/8 $ 5 Second Quarter................................................................................ 65/8 37/8 Third Quarter................................................................................. 107/8 51/4 Fourth Quarter................................................................................ 111/2 81/4 1993: First Quarter................................................................................. 113/4 81/2 Second Quarter................................................................................ 141/8 97/8 Third Quarter................................................................................. 135/8 101/8 Fourth Quarter................................................................................ 15 105/8 1994: First Quarter................................................................................. 191/2 141/2 Second Quarter................................................................................ 213/4 15 Third Quarter................................................................................. 217/8 143/8 Fourth Quarter (through March 18, 1994)....................................................... 243/8 207/8
On March 18, 1994, the last reported sales price for the Common Stock on the NYSE Composite Transactions Tape was $23 5/8 per share. The Company has not paid any cash dividends on its Common Stock and has no plans to pay cash dividends on its Common Stock in the foreseeable future. Although the Company's loan agreements do not directly limit the payment of dividends on the Company's Common Stock and preferred stocks, these agreements require the Company to comply with certain financial covenants that are affected by dividend payments. These tests include minimum tangible net worth levels, maximum ratios of total liabilities to tangible net worth and minimum ratios of certain current assets to current liabilities. Under the most restrictive of these tests, the Company had approximately $63.9 million available for the payment of dividends as of February 27, 1994. 5 CAPITALIZATION The following table sets forth the consolidated capitalization of the Company at February 27, 1994, and as adjusted to give effect to the conversion of the Depositary Shares and the underlying Preferred Shares and the issuance of 8,250,000 shares of Common Stock, net of certain expenses associated therewith.
February 27, 1994 ------------------------ Actual As Adjusted ---------- ------------ (in millions) Short-term borrowings and current portion of long-term debt............................ $ 11.9 $ 11.9 Long-term debt including capital lease obligations..................................... $ 25.8 $ 25.8 Shareholders' Equity: Preferred Stock, $0.50 par value: Authorized -- 1,000,000 shares; issued and outstanding -- 250,000 shares of $40 Convertible Exchangeable Preferred Stock(1), actual, and none as adjusted; -- 345,000 shares of $32.50 Convertible Preferred Stock(2), actual and as adjusted..... .3 .2 Common Stock, $0.50 par value: Authorized -- 200,000,000 shares; issued and outstanding -- 113,135,546 shares, actual(3), and 121,385,546 shares, as adjusted...................................... 56.5 60.7 Additional paid-in capital........................................................... 907.4 901.3 Retained earnings.................................................................... 61.3 61.3 ---------- ------------ Total shareholders' equity......................................................... 1,025.5 1,023.5 ---------- ------------ Total capitalization................................................................... $ 1,051.3 $ 1,049.3 - ------------------------ (1) The $40 Convertible Exchangeable Preferred Stock has an aggregate liquidation preference of $125.0 million and has been called for redemption by the Company. (2) The $32.50 Convertible Preferred Stock has an aggregate liquidation preference of $172.5 million and cannot be called for redemption before November 1995. (3) At February 27, 1994, 28.4 million shares of Common Stock were reserved for issuance under the Company's various stock option, benefit and stock purchase plans, of which options to purchase 18.7 million shares of Common Stock were outstanding. In addition, 8.25 million shares of Common Stock were reserved for issuance upon conversion of the Preferred Shares and 12.17 million shares of Common Stock were reserved for issuance upon conversion of the $32.50 Convertible Preferred Stock.
6 SELECTED FINANCIAL DATA The selected financial data set forth below relating to each of the five fiscal years in the period ended May 30, 1993 have been derived from the Company's audited consolidated financial statements. This information is qualified by the detailed information and financial statements incorporated by reference in the Prospectus. The selected financial data set forth below relating to the nine months ended February 27, 1994 and February 28, 1993 are unaudited and have been prepared on the same basis as the annual information included in this Prospectus and, in management's opinion, reflect all adjustments (consisting only of normal recurring entries except as discussed in Note 2 and Note 3 of the Company's Quarterly Report on Form 10-Q for the quarters ended August 29, 1993, November 28, 1993 and February 27, 1994) necessary for a fair presentation of the information for the periods presented. The operating results for any period are not necessarily indicative of results for any future period. National's former Information Systems Group has been classified as discontinued operations for all periods presented, as these businesses were sold during fiscal 1989.
Years Ended(1) Nine Months Ended ----------------------------------------------------- -------------------- May 30, May 31, May 26, May 27, May 28, Feb. 27, Feb. 28, 1993 1992 1991 1990 1989 1994 1993 --------- --------- --------- --------- --------- --------- --------- (dollars in millions, except per-share amounts) INCOME STATEMENT DATA: Net Sales.................................. $ 2,013.7 $ 1,717.5 $ 1,701.8 $ 1,675.0 $ 1,647.9 $ 1,686.0 $ 1,455.8 Operating costs and expenses(2): Cost of sales............................ 1,298.3 1,182.1 1,294.3 1,251.1 1,293.5 985.8 950.1 Research and development................. 229.2 208.9 198.6 252.4 251.6 191.3 167.6 Selling, general and administrative...... 339.2 299.6 241.9 224.3 236.2 303.8 245.1 Restructuring of operations.............. -- 149.3 119.6 (8.0) 53.6 -- -- --------- --------- --------- --------- --------- --------- --------- Total operating costs and expenses..... 1,866.7 1,839.9 1,854.4 1,719.8 1,834.9 1,480.9 1,362.8 --------- --------- --------- --------- --------- --------- --------- Operating income (loss).................... 147.0 (122.4) (152.6) (44.8) (187.0) 205.1 93.0 Interest income (expense), net............. 2.9 5.4 3.6 12.4 (11.5) 6.9 1.8 --------- --------- --------- --------- --------- --------- --------- Income (loss) from continuing operations before income taxes....................... 149.9 (117.0) (149.0) (32.4) (198.5) 212.0 94.8 Income taxes (benefit)..................... 19.6 3.1 1.3 (3.1) 7.0 35.3 10.7 --------- --------- --------- --------- --------- --------- --------- Income (loss) from continuing operations... $ 130.3 $ (120.1) $ (150.3) $ (29.3) $ (205.5) $ 176.7 $ 84.1 Discontinued operations: Earning (loss) from operations........... -- -- -- -- (37.7) -- -- Gain on sale............................. -- -- (1.1) 4.3 220.0 -- -- Cumulative effect of accounting change for years prior to 1994....................... -- -- -- -- -- 4.9 -- --------- --------- --------- --------- --------- --------- --------- Net income (loss).......................... $ 130.3 $ (120.1) $ (151.4) $ (25.0) $ (23.2) $ 181.6 $ 84.1 --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- Net earnings (loss) used in per common share calculation (reflecting preferred dividends)................................ $ 113.2 $ (130.1) $ (161.4) $ (35.0) $ (33.2) $ 165.7 $ 72.3 Earnings (loss) per common share: Earnings (loss) from continuing operations.............................. $ 0.98 $ (1.24) $ (1.55) $ (0.38) $ (2.09) $ 1.34 $ 0.63 Discontinued operations.................. -- -- (0.01) 0.04 1.77 -- -- Cumulative effect of accounting change... -- -- -- -- -- 0.04 -- --------- --------- --------- --------- --------- --------- --------- Net earnings (loss) per common share... $ 0.98 $ (1.24) $ (1.56) $ (0.34) $ (0.32) $ 1.38 $ 0.63 --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- Fully dilutive earnings per common share(3): Fully dilutive earnings per common share before cumulative effect of accounting change for years prior to 1994.......... -- -- -- -- -- $ 1.26 -- --------- --------- --------- --------- --------- --------- --------- Cumulative effect of accounting change... -- -- -- -- -- 0.03 -- --------- --------- --------- --------- --------- --------- --------- Fully dilutive earnings per common share................................. -- -- -- -- -- $ 1.29 -- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- Weighted average common shares and common share equivalents outstanding (in millions)(3).............................. 115.9 104.6 103.4 102.7 103.1 120.1 115.0 BALANCE SHEET DATA(4): Cash and cash equivalents.................. $ 277.4 $ 138.3 $ 192.5 $ 128.7 $ 228.0 $ 335.2 $ 246.1 Working capital............................ 336.6 122.0 196.1 223.4 229.6 492.1 362.2 Total assets............................... 1,476.5 1,148.9 1,190.7 1,377.6 1,416.1 1,626.3 1,347.0 Total debt................................. 47.9 45.4 46.0 76.2 62.2 37.7 49.6 Total shareholders' equity................. $ 837.4 $ 539.4 $ 658.3 $ 816.8 $ 848.5 $ 1,025.5 $ 793.3 OTHER DATA(5): Capital additions.......................... $ 235.1 $ 189.4 $ 109.8 $ 182.0 $ 277.6 $ 158.9 $ 137.2 Depreciation and amortization.............. 159.8 167.0 181.9 179.9 184.7 126.1 118.8 Number of employees at period-end.......... 23,400 27,200 29,800 32,700 32,200 22,900 25,600
(SEE FOLLOWING PAGE FOR NOTES TO SELECTED FINANCIAL DATA) 7 NOTES TO SELECTED FINANCIAL DATA (1) Fiscal 1993, 1991, 1990 and 1989 were 52-week years whereas fiscal 1992 was a 53-week year. (2) Effective beginning fiscal year 1994, the Company changed its method for accounting to include certain costs in inventory which were previously charged directly to cost of sales as incurred. The cumulative effect of this change on years prior to fiscal year 1994 of $4.9 million is reflected in the Income Statement Data for the nine months ended February 27, 1994. In addition, beginning in fiscal year 1994, the Company reclassified certain period expenses from cost of sales to research and development expenses or selling, general and administrative expense. The amounts presented for the nine months ended February 28, 1993, and the fiscal years ended May 30, 1993 and May 31, 1992 have been reclassified to conform with the fiscal 1994 presentation. Amounts in the Selected Financial Data table for the fiscal years ended 1991, 1990 and 1989 have not been reclassified. For the first nine months of fiscal year 1993, the effect of the reclassification was to decrease cost of sales by $63.9 million, or 4.4 percent of sales, and to increase research and development and selling, general and administrative expenses by $20.9 million and $43.0 million, or 1.4 percent and 3.0 percent of sales, respectively. For fiscal year 1993, the effect of the reclassification was to decrease cost of sales by $81.3 million, or 4.0 percent of sales, and to increase research and development and selling and administrative expense by $26.9 million and $54.4 million, or 1.3 percent and 2.7 percent of sales, respectively. For the fiscal year 1992, the effect of the reclassification was to decrease cost of sales by $65.4 million, or 3.8 percent of sales, and to increase research and development and selling general and administrative expenses by $16.8 million and $48.6 million, or 1.0 percent and 2.8 percent of sales, respectively. Net income was not affected in any period by the reclassifications. For additional information, see Note 3 in the Company's Quarterly Report on Form 10-Q for the quarters ended August 29, 1993, November 28, 1993 and February 27, 1994. (3) Fully diluted earnings per share are disclosed for the first nine months of fiscal year 1994 as it was the only period in which the results were dilutive. The weighted average number of common shares and common share equivalents used for the fully dilutive earnings per common share calculation is 140.8 million. (4) At end of period. (5) National has paid no cash dividends on its Common Stock in any of the periods presented, and has no plans to pay cash dividends on its Common Stock in the foreseeable future. 8 REDEMPTION OR CONVERSION OF DEPOSITARY SHARES The Company has called all of the outstanding Preferred Shares for redemption on April 21, 1994 (the "Redemption Date") pursuant to the terms of the Certificate of the Powers, Designations, Preferences and Rights of the Preferred Shares (the "Certificate of Designations"). As a result of the call for redemption, holders of Depositary Shares ("Holders") are entitled to receive from the Company upon redemption the sum of $50.80, plus accrued dividends from March 1, 1994 to the Redemption Date in the amount of $0.57 per share. The total amount payable upon redemption is thus $51.37 per share (the "Redemption Price"). No dividends will accrue on the Depositary Shares from and after the Redemption Date. Holders have as alternatives, in addition to the right to sell their Depositary Shares through usual brokerage facilities, (1) the right to convert their Depositary Shares into Common Stock at the rate of 3.30 shares of Common Stock for each Depositary Share converted and (2) the right to have their Depositary Shares redeemed on the Redemption Date for the Redemption Price. The availability of the first alternative will terminate at 5:00 p.m. Eastern Daylight Time on April 21, 1994, as more fully described below. ALTERNATIVES AVAILABLE TO HOLDERS OF DEPOSITARY SHARES Holders of Depositary Shares have the following alternatives, which should be carefully considered: 1. CONVERSION OF DEPOSITARY SHARES INTO COMMON STOCK. Until 5:00 p.m. Eastern Daylight Time, on April 21, 1994, at the offices of The First National Bank of Boston (the "Depositary") as listed below, the Depositary Shares are convertible at the option of the Holder, at the rate of 3.30 shares of Common Stock for each Depositary Share. On the basis of the last reported sales price of the Common Stock on the NYSE on March 18, 1994 of $23 5/8, 3.30 shares had a value (including cash in lieu of any fractional share) equivalent to $77.96. See "Price Range of Common Stock and Dividend Policy" for additional market price information. In the event such conversion would result in a fractional share of Common Stock (after aggregating the number of Depositary Shares surrendered by a Holder for conversion), an amount equivalent to the value of the fractional share will be paid in cash. Such amount will be determined on the basis of the last reported sales price on the NYSE on the day such Depositary Shares are converted. No payment or adjustment will be made on conversion for dividends accrued on the Depositary Shares surrendered for conversion or for dividends on Common Stock delivered on such conversion. Accordingly, any Holder surrendering Depositary Shares for conversion will not receive any dividends with respect to such Depositary Shares accrued since March 1, 1994. To convert Depositary Shares into Common Stock, the Holder thereof must surrender certificates representing such Depositary Shares prior to 5:00 p.m., Eastern Daylight Time, on April 21, 1994 to the Depositary, as follows: if by hand, BancBoston Trust Company of New York, 55 Broadway, Third Floor, New York, New York; if by mail, The First National Bank of Boston, Shareholder Services Division, P.O. Box 1889, Mail Stop 45-01-19, Boston, Massachusetts 02105; and if by overnight courier, The First National Bank of Boston, Shareholder Services Division, 150 Royall Street, Mail Stop 45-01-19, Canton, Massachusetts 02021. In addition, the Holder must give written notice to the Depositary that the Holder elects to convert such Depositary Shares. Such notice must state the name or names in which the certificate or certificates for shares of Common Stock issuable on such conversion shall be issued, together with the address or addresses of the person or persons so named. Each Depositary Share surrendered for conversion must, unless the shares issuable on conversion are to be issued in the same name as the name in which such Depositary Share is registered, be accompanied by instruments of transfer, in form satisfactory to the Company, duly executed by the Holder, or his or her duly authorized attorney, and payment of any applicable transfer tax. The notice that must be given to the Depositary may be provided by surrendering Depositary Shares accompanied by the Letter of Transmittal dated March 22, 1994 provided to all record Holders as of March 16, 1994. As promptly as practicable after the surrender of such Depositary Shares, in the proper manner, the Company will issue and deliver at the office of the Depositary to such Holder, or on such Holder's written order, a certificate or certificates for the number of full shares of Common Stock issuable upon the conversion of such Depositary Shares and a check for the amount payable in lieu of any fractional share based on the last reported sales price 9 of the Common Stock on the NYSE on the day of conversion. In the case of any conversion of only a portion of the number of Depositary Shares represented by a single certificate, a new certificate equal to the number of unconverted shares represented thereby will be issued to the Holder. 2. REDEMPTION OF DEPOSITARY SHARES ON APRIL 21, 1994. Any Depositary Shares which have not been converted into Common Stock either by a Holder or by the Purchaser, on or prior to 5:00 p.m. Eastern Daylight Time on April 21, 1994, will be redeemed on April 21, 1994 (the Redemption Date). Upon redemption a Holder will receive $51.37 per Depositary Share (consisting of a redemption price of $50.80 per share plus accrued and unpaid dividends thereon from March 1, 1994 to the Redemption Date of $0.57 per share). On and after the Redemption Date, dividends will cease to accrue and Holders will not have any rights as such Holders other than the right to receive $51.37 per share upon surrender of their Depositary Shares. To receive the Redemption Price specified above for any Depositary Shares being redeemed, the Holder thereof must surrender such Depositary Shares to the Depositary at the addresses set forth above. SUMMARY OF AVAILABLE ALTERNATIVES Under the foregoing alternatives, based upon the last reported sales price of the Common Stock on the NYSE on March 18, 1994 of $23 5/8 per share, a Holder who converted such Depositary Shares on that date would have received Common Stock (including cash in lieu of any fractional share) having a market value of $77.96. So long as the market price of the Common Stock is at least $15.57 per share, a Holder who converts will receive Common Stock with a market value, plus cash in lieu of any fractional share, greater than the amount of cash the Holder would otherwise be entitled to receive upon redemption or upon a sale of Depositary Shares to the Purchaser referred to under "Standby Arrangements" herein. If a Holder surrenders such Depositary Shares for redemption, such Holder will receive $51.37 in cash. It should be noted, however, that the price of Common Stock received upon conversion will fluctuate in the market, and that Holders may incur various expenses of sale if such Common Stock is sold in the market. See "Price Range of Common Stock and Dividend Policy" for additional market price information. Holders are urged to obtain current market quotations for the Company's Common Stock. The conversion right expires at 5:00 p.m., Eastern Daylight Time, on April 21, 1994. The Depositary Shares may be converted into Common Stock only by delivery of Depositary Shares to the Depositary prior to 5:00 p.m., Eastern Daylight Time, on April 21, 1994. Since it is the time of receipt, not the time of mailing, that determines whether Depositary Shares have been properly tendered for conversion, sufficient time should be allowed for Depositary Shares sent by mail to be received by the Depositary prior to 5:00 p.m., Eastern Daylight Time, on April 21, 1994. Any Depositary Shares which have not been properly presented to the Depositary for conversion prior to 5:00 p.m., Eastern Daylight Time, on April 21, 1994 will be automatically redeemed as set forth above. CERTAIN FEDERAL INCOME TAX CONSEQUENCES The following summary describes the anticipated federal income tax consequences of (i) the conversion of Depositary Shares to Common Stock and (ii) the redemption of Depositary Shares for cash (such conversion and redemption are collectively referred to as the "Alternative Transactions"). This summary is for general information only and is based upon the provisions of the Internal Revenue Code of 1986, as amended (the "Code"), the final, temporary and proposed regulations promulgated thereunder and administrative rulings and judicial decisions now in effect, all of which are subject to change (possibly with retroactive effect) or different interpretations. This summary does not deal with all aspects of federal income taxation that could be relevant to an investor in deciding between the Alternative Transactions, and it is not intended to be applicable to all categories of investors, some of which, such as dealers in securities, financial institutions, insurance companies, tax-exempt organizations and foreign holders, may be subject to special rules. In addition, the summary is limited to holders 10 who have held their Depositary Shares as "capital assets" (generally, property held for investment) within the meaning of Section 1221 of the Code. Holders should note that there can be no assurance that the Internal Revenue Service (the "IRS") will take a similar view with respect to the tax consequences described below, and no ruling has been or will be requested by the Company from the IRS on any tax matters relating to the Alternative Transactions. THE ALTERNATIVE TRANSACTIONS 1. CONVERSION OF DEPOSITARY SHARES INTO COMMON STOCK. For federal income tax purposes, the conversion of Depositary Shares into Common Stock will not result in taxable gain or loss to a converting holder, except to the extent cash is received in lieu of fractional shares of Common Stock. Gain or loss resulting from receipt of cash in lieu of fractional shares of Common Stock will equal the difference between the proceeds received with respect to such fractional shares and the converting holder's tax basis in the Depositary Shares allocated to such fractional shares. Common Stock received by a converting holder will have an initial tax basis equal to the adjusted tax basis of the Depositary Shares converted therefor (less the tax basis, if any, allocated to fractional shares) and such Common Stock will have a holding period that includes the period during which the converting holder held the Depositary Shares converted therefor. 2. REDEMPTION OF DEPOSITARY SHARES. A redemption of Depositary Shares by the Company will be treated under Section 302 of the Code as a distribution that is taxable as a dividend at ordinary income tax rates (to the extent of the Company's current and accumulated earnings and profits), unless the redemption (i) is "substantially disproportionate" with respect to the redeeming holder, (ii) results in a "complete termination" of the redeeming holder's stock interest in the Company, or (iii) is "not essentially equivalent to a dividend" with respect to the redeeming holder, all within the meaning of Section 302(b) of the Code. In determining whether any of these tests has been met, any shares of Company stock considered to be owned by the redeeming holder by reason of certain constructive ownership rules set forth in Section 318(a) of the Code (E.G., to reflect Common Stock constructively owned by reason of the convertibility of the Depositary Shares), as well as shares actually owned, must generally be taken into account. Because the analysis under Section 302(b) of the Code will vary among holders, and will depend on the facts and circumstances at the time that the determination must be made, each redeeming holder must consult his or her tax advisor to determine the appropriate tax treatment of such holder's redemption of Depositary Shares under Section 302(b) of the Code. If redemption of the Depositary Shares is not treated as a distribution taxable as a dividend to a particular holder because it meets any of the tests set forth in Section 302(b) of the Code, such redemption will constitute, as to that holder, a taxable exchange under Section 302(a) of the Code. In this event, redeeming holders will recognize gain or loss equal to the difference between (i) the amount of cash received by the holder in the redemption (except to the extent attributable to the payment of accrued dividends) and (ii) the holder's tax basis in the Depositary Shares surrendered in the redemption. Any such gain or loss will be long-term capital gain or loss, provided the holder held the Depositary Shares for more than one year. BACKUP WITHHOLDING Under the backup withholding provisions of the Code, a holder of Depositary Shares or Common Stock may be subject to backup withholding at the rate of 31% with respect to dividends paid on, or the proceeds of a sale, exchange, conversion or redemption of, Depositary Shares or Common Stock unless (a) such holder is a corporation or comes within certain other exempt categories and, when required, demonstrates this fact, or (b) provides a taxpayer identification number, certifies as to no loss of exemption from backup withholding, and otherwise complies with applicable requirements of the backup withholding rules. A holder of Depositary Shares who does not provide the Company with his or her correct taxpayer identification number may be subject to penalties imposed by the IRS. 11 The Company will report to the holders of Depositary Shares and Common Stock, and to the IRS, the amount of any "reportable payments" and any amount withheld with respect to the Depositary Shares and Common Stock during each calendar year. THE FOREGOING DISCUSSION IS FOR GENERAL INFORMATION AND IS NOT TAX ADVICE. ACCORDINGLY, EACH HOLDER OF DEPOSITARY SHARES SHOULD CONSULT HIS OR HER TAX ADVISOR AS TO THE PARTICULAR TAX CONSEQUENCES TO HIM OR HER OF THE ALTERNATIVE TRANSACTIONS, AS WELL AS THE CONSEQUENCES TO HIM OR HER OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF ANY COMMON STOCK RECEIVED ON CONVERSION OF THE DEPOSITARY SHARES, INCLUDING THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS, AND ANY CHANGES IN APPLICABLE TAX LAWS. STANDBY ARRANGEMENTS Upon the terms and subject to the conditions contained in the Standby Agreement dated March 22, 1994 between the Company and the Purchaser (the "Standby Agreement"), the Purchaser has agreed to purchase from the Company such number of shares (the "Purchased Shares") of Common Stock as would have been issuable upon conversion of such of the Depositary Shares which are not surrendered for conversion at or prior to 5:00 p.m. Eastern Daylight Time on April 21, 1994. The price to the Purchaser of the Purchased Shares will be $15.57 per share. The Purchaser may also purchase Depositary Shares in the open market or otherwise prior to the expiration of the conversion privilege, and the Purchaser has agreed with the Company to convert any Depositary Shares so purchased into Common Stock (the "Conversion Shares"). The Purchaser has agreed to pay to the Company 50% of the excess, if any, of the aggregate proceeds received on the sale of the Purchased Shares (net of selling concessions, transfer taxes and other directly related expenses) over the aggregate purchase price paid therefor. The Company has been advised by the Purchaser that it proposes to offer for resale any shares of Common Stock purchased from the Company or acquired upon conversion as set forth on the cover page of this Prospectus. The Purchaser may also make sales of such shares to certain securities dealers at prices which may reflect concessions from the prices at which such shares are then being offered to the public. The amount of such concessions will be determined from time to time by the Purchaser. Under the terms of the Standby Agreement and as compensation for the commitment of the Purchaser thereunder, the Company has agreed to pay the Purchaser the sum of $1,125,000, plus an additional sum for certain Compensable Shares. The additional sum will be paid as follows: (i) no additional sum will be paid if the total number of Compensable Shares is less than or equal to 412,500 and (ii) if the total number of Compensable Shares is greater than 412,500, the additional sum will equal $0.47 per share for all Compensable Shares exceeding 412,500 shares. Compensable Shares consist of Purchased Shares plus any Conversion Shares which are resold by the Purchaser for less than $15.57 per share. The Company has also agreed to pay the reasonable out-of-pocket expenses of the Purchaser, other than the fees and disbursements of Purchaser's counsel, and to pay Blue Sky fees and expenses. Pursuant to the Standby Agreement, the Company has agreed that it will not, without the written consent of the Purchaser, sell, contract to sell or otherwise dispose of any shares of Common Stock, with certain exceptions, for a period commencing on the date of this Prospectus and ending 90 days after the Redemption Date, provided that if the Purchaser does not acquire any Purchased Shares pursuant to the Standby Agreement, the Company will no longer be bound by such restriction. In addition, the Company has agreed that it will cause directors and certain officers to not, prior to the Redemption Date, without the prior written consent of the Purchaser, sell, contract to sell or otherwise dispose of any shares of Common Stock, except for an aggregate amount of 125,000 shares. The Company has agreed to indemnify the Purchaser against certain liabilities, including liabilities under the Securities Act of 1933, as amended. 12 The Purchaser has performed investment banking services for the Company from time to time in the ordinary course of its business. CERTAIN LEGAL MATTERS The validity of the shares of Common Stock offered hereby will be passed upon for the Company by Latham & Watkins, San Francisco, California. Certain legal matters will be passed upon for the Purchaser by Munger, Tolles & Olson, Los Angeles, California. EXPERTS The consolidated financial statements of the Company as of May 30, 1993 and May 31, 1992 and for each of the years in the three-year period ended May 30, 1993, and the related schedules incorporated herein by reference have been incorporated herein by reference in reliance upon the reports of KPMG Peat Marwick, independent certified public accountants, also incorporated herein by reference, and upon the authority of said firm as experts in accounting and auditing. 13 NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE PURCHASER. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY BY ANY PERSON OR IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. 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 INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE. ------------------------ TABLE OF CONTENTS
PAGE ----------- Available Information......................... 2 Incorporation of Certain Documents By Reference.................................... 2 The Company................................... 3 Risk Factors.................................. 3 Use of Proceeds............................... 5 Price Range of Common Stock and Dividend Policy....................................... 5 Capitalization................................ 6 Selected Financial Data....................... 7 Redemption or Conversion of Depositary Shares....................................... 9 Certain Federal Income Tax Consequences....... 10 Standby Arrangements.......................... 12 Certain Legal Matters......................... 13 Experts....................................... 13
8,250,000 SHARES NATIONAL SEMICONDUCTOR CORPORATION COMMON STOCK (PAR VALUE $0.50 PER SHARE) - ----------------------------- SALOMON BROTHERS INC - ------------------------------------- PROSPECTUS DATED MARCH 22, 1994 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The following table sets forth an itemized statement of all expenses (other than in connection with the standby arrangements) in connection with the issuance and distribution of the securities being registered hereby. All amounts are estimated except for the SEC registration fee. SEC registration fee................................................... $ 64,542 Printing fees.......................................................... 52,000 Accountant's fees and expenses......................................... 75,000 Legal fees and expenses................................................ 65,000 Blue Sky fees and expenses............................................. 5,000 Depositary and Transfer Agent fees and expenses........................ 4,000 Miscellaneous expenses................................................. 19,458 ---------- Total................................................................ $ 285,000 ---------- ----------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 102 of the Delaware General Corporation Law ("DGCL") allows a corporation to eliminate the personal liability of directors of a corporation to the corporation or to any of its stockholders for monetary damages for a breach of fiduciary duty as a director, except (i) for breach of the director's duty of loyalty, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for certain unlawful dividends and stock repurchases or (iv) for any transaction from which the director derived an improper personal benefit. Article Thirteenth of the Company's Second Restated Certificate of Incorporation (the "Certificate") provides that no director shall be personally liable to National or its stockholders for monetary damages for any breach of his fiduciary duty as a director, except as provided in Section 102 of the DGCL. Section 145 of the DGCL provides that in the case of any action other than one by or in the right of the corporation, a corporation may indemnify any person who was or is a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation in such capacity on behalf of another corporation or enterprise, against expenses (including attorneys' fees) judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interest of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. Section 145 of the DGCL provides that in the case of an action by or in the right of a corporation to procure a judgment in its favor, a corporation may indemnify any person who was or is a party or is threatened to be made a party to any action or suit by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation in such capacity on behalf of another corporation or enterprise, against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted under standards similar to those set forth in the preceding paragraph, except that no indemnification may be made in respect of any action or claim as to which such person shall have been adjudged to be liable to the corporation unless a court determines that such person is fairly and reasonably entitled to indemnification. Article Thirteenth of National's Certificate provides that National shall to the extent permitted by law indemnify any person for all liabilities incurred by or imposed upon him as a result of any action or threatened action, suit or proceeding, whether civil, criminal, administrative or investigative, in which he shall be involved by reason of the fact that he is or was serving as a director, officer or employee of II-1 National, or, that, at the request of National, he is or was serving another corporation or enterprise in any capacity. Article VIII of National's By-Laws provides for indemnification of any person who was or is a party to any threatened, pending or completed action, or to any derivative proceeding by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or was serving at the request of the corporation in that capacity for another corporation if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct unlawful. National has purchased and maintains at its expense on behalf of directors and officers insurance, within certain limits, covering liabilities that may be incurred by them in such capacities. The form of Standby Agreement filed as Exhibit 1 to the Registration Statement provide for indemnification of National's directors and officers by the Purchaser against certain liabilities, including liabilities under the Securities Act. ITEM 16. EXHIBITS.
EXHIBIT NO. DESCRIPTION - ------------- ----------------------------------------------------------------------------------------------------- 1 Form of Standby Agreement. 4-A Second Restated Certificate of Incorporation of the Company. 4-B** Certificate of the Powers, Designations, Preferences and Rights of the $40 Convertible Exchangeable Preferred Shares (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 2-99864, which became effective September 6, 1985). 4-C Certificate of the Powers, Designations, Preferences and Rights designating the $32.50 Convertible Preferred Stock. 4-D By-Laws of the Company. 4-E** Form of Common Stock Certificate (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 33-48935, which became effective October 5, 1992). 4-F** Form of $40 Convertible Exchangeable Preferred Stock Certificate (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 2-99864, which became effective September 6, 1985). 4-G** Form of $32.50 Convertible Preferred Stock Certificate (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 33-48935, which became effective October 5, 1992). 4-H** Deposit Agreement and Form of Depositary Receipt (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 2-99864, which became effective September 6, 1985). 4-I Deposit Agreement and Form of Depositary Receipt. 4-J** Rights Agreement (incorporated by reference from the Exhibits to the Company's Registration Statement on Form 8-A filed August 9, 1988). 5 Opinion of Latham & Watkins. 23-A Consent of KPMG Peat Marwick. 23-B Consent of Latham & Watkins (contained in its opinion filed as Exhibit 5 to this Registration Statement). 24 Power of Attorney. - ------------------------ ** Incorporated herein by reference as indicated.
II-2 ITEM 17. UNDERTAKINGS. (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial BONA FIDE offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial BONA FIDE offering thereof. (h) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue. (i) The undersigned registrant hereby further undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933, 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 497(h) under the Securities Act of 1933 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 of 1933, 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-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3, and has duly caused this Registration Statement to be signed on its behalf by or on behalf of the undersigned, thereunto duly authorized, in the City of Santa Clara, and State of California, on the 21st day of March, 1994. NATIONAL SEMICONDUCTOR CORPORATION By: /S/ GILBERT F. AMELIO -------------------------------------- Gilbert F. Amelio President, Chief Executive Officer and Director Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by or on behalf of the following persons in the capacities indicated on the 21st day of March, 1994.
SIGNATURE TITLE - ------------------------------------------------------ --------------------------------------------------------- /S/ PETER J. SPRAGUE* ------------------------------------------- Chairman of the Board Peter J. Sprague /S/ GILBERT F. AMELIO ------------------------------------------- President, Chief Executive Officer and Director Gilbert F. Amelio (Principal Executive Officer) /S/ DONALD MACLEOD* ------------------------------------------- Senior Vice President, Finance and Chief Financial Donald Macleod Officer (Principal Financial Officer) /S/ ROBERT B. MAHONEY* ------------------------------------------- Controller (Principal Accounting Officer) Robert B. Mahoney /S/ GARY P. ARNOLD* ------------------------------------------- Director Gary P. Arnold /S/ ROBERT BESHAR* ------------------------------------------- Director Robert Beshar /S/ MODESTO A. MAIDIQUE* ------------------------------------------- Director Modesto A. Maidique /S/ J. TRACY O'ROURKE* ------------------------------------------- Director J. Tracy O'Rourke /S/ CHARLES E. SPORCK* ------------------------------------------- Director Charles E. Sporck /S/ DONALD E. WEEDEN* ------------------------------------------- Director Donald E. Weeden *By /S/ GILBERT F. AMELIO ---------------------------------------- Gilbert F. Amelio Attorney-in-Fact
II-4 INDEX TO EXHIBITS
SEQUENTIALLY EXHIBITS DESCRIPTION NUMBERED PAGE - ----------- --------------------------------------------------------------------------------------- -------------- 1 Form of Standby Agreement.............................................................. 4-A Second Restated Certificate of Incorporation of the Company............................ 4-B** Certificate of the Powers, Designations, Preferences and Rights of the $40 Convertible Exchangeable Preferred Shares (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 2-99864, which became effective September 6, 1985).......................................................... 4-C Certificate of the Powers, Designations, Preferences and Rights designating the $32.50 Convertible Preferred Stock........................................................... 4-D By-Laws of the Company................................................................. 4-E** Form of Common Stock Certificate (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 33-48935, which became effective October 5, 1992)............................................................ 4-F** Form of $40 Convertible Exchangeable Preferred Stock Certificate (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 2-99864, which became effective September 6, 1985)................... 4-G** Form of $32.50 Convertible Preferred Stock Certificate (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 33-48935, which became effective October 5, 1992)..................................... 4-H** Deposit Agreement and Form of Depositary Receipt (incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-3, Registration No. 2-99864, which became effective September 6, 1985).................................... 4-I Deposit Agreement and Form of Depositary Receipt....................................... 4-J** Rights Agreement (incorporated by reference from the Exhibits to the Company's Registration Statement on Form 8-A filed August 9, 1988).............................. 5 Opinion of Latham & Watkins............................................................ 23-A Consent of KPMG Peat Marwick........................................................... 23-B Consent of Latham & Watkins (contained in its opinion filed as Exhibit 5 to this Registration Statement)............................................................... 24 Power of Attorney...................................................................... - ------------------------ ** Incorporated herein by reference as indicated.
EX-1 2 EXHIBIT 1 NATIONAL SEMICONDUCTOR CORPORATION $40.00 CONVERTIBLE EXCHANGEABLE PREFERRED SHARES (THE "PREFERRED SHARES") AND DEPOSITARY CONVERTIBLE EXCHANGEABLE PREFERRED SHARES EACH REPRESENTING 1/10TH PREFERRED SHARE (THE "DEPOSITARY SHARES") STANDBY AGREEMENT New York, New York March 22, 1994 SALOMON BROTHERS INC Seven World Trade Center New York, New York 10048 Dear Sirs: National Semiconductor Corporation, a Delaware corporation (the "Company"), intends to call for redemption on April 21, 1994 (the "Redemption Date"), all of its outstanding $40.00 Convertible Exchangeable Preferred Shares (the "Preferred Shares") and its Depositary Convertible Exchangeable Shares, each representing ownership of 1/10th of a Preferred Share (the "Depositary Shares" or "Redeemable Securities") at a redemption price of $50.80 per Depositary Share plus accrued dividends from March 1, 1994, to the Redemption Date of $0.57, for a total redemption price of $51.37 (the "Redemption Price") per Depositary Share. The Redeemable Securities are convertible into shares of the Common Stock, $0.50 par value, of the Company ("Common Stock") at any time prior to 5:00 P.M., New York City time, on April 21, 1994 (the "Conversion Date"). In order to ensure that the Company will have available sufficient funds to redeem any Redeemable Securities not converted on or prior to the Conversion Date, the Company desires to make arrangements pursuant to which you (the "Purchaser") will, on the Conversion Date, purchase shares of Common Stock that would have been issuable upon the conversion of the Redeemable Securities that have not been surrendered for conversion prior to 5:00 P.M., New York City time, on the Conversion Date. 1. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants to, and agrees with, the Purchaser as set forth below in this Section 1. Certain terms used in this Section 1 are defined in paragraph (h) hereof. (a) The Company meets the requirements for use of Form S-3 under the Securities Act of 1933 (the "Act") and has filed with the Securities and Exchange Commission (the "Commission") a registration statement on such Form for the registration under the Act of the issuance by the Company of the shares of Common Stock issuable upon conversion by the Purchaser of Redeemable Securities and the sale by the Purchaser of any shares of Common Stock that may be acquired by it. The Company may file with the Commission one of the following: (i) prior to effectiveness of such registration statement, a further amendment to such registration statement, including the form of final prospectus, (ii) a final prospectus in accordance with Rules 430A and 424(b)(1) or (4), or (iii) a final prospectus in accordance with Rules 415 and 424(b)(2) or (5). In the case of clause (ii), the Company has included in such registration statement, as amended at the Effective Date, all information (other than Rule 430A Information) required by the Act and the rules thereunder to be included in the Prospectus with respect to the Common Stock registered pursuant to the Registration Statement and the offering thereof. As filed, such amendment and form of final prospectus, or such final prospectus, shall contain all Rule 430A Information, together with all other such required information, with respect to the Common Stock registered pursuant to the Registration Statement and the offering thereof and, except to the extent the Purchaser shall agree in writing to a modification, shall be in all substantive respects in the form furnished to you prior to the Execution Time or, to the extent not completed at the Execution Time, shall contain only such specific additional information and other changes (beyond that contained in the latest Preliminary Prospectus) as the Company has advised you, prior to the Execution Time, will be included or made therein. If the Registration Statement contains the undertaking specified by Regulation S-K Item 512(a), the Registration Statement, at the Execution Time, meets the requirements set forth in Rule 415(a)(1)(x). (b) On the Effective Date, the Registration Statement did or will, and when the Prospectus is first filed (if required) in accordance with Rule 424(b), on the Conversion Date, on the Redemption Date and on the Closing Date, the Prospectus (and any supplements thereto) will, comply in all material respects with the applicable requirements of the Act and the Securities Exchange Act of 1934 (the "Exchange Act") and the respective rules thereunder; on the Effective Date, the Registration Statement did not or will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading; and, on the Effective Date, the Prospectus, if not filed pursuant to Rule 424(b), did not or will not, and on the date of any filing pursuant to Rule 424(b), on the Conversion Date, on the Redemption Date and on the Closing Date, the Prospectus (together with any supplement thereto) will not, include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; PROVIDED, HOWEVER, that the Company makes no representations or warranties as to the information contained in or omitted from the Registration Statement or the Prospectus (or any supplement thereto) in reliance upon and in conformity with information furnished in writing to the Company by or on behalf of the Purchaser through the Purchaser specifically for inclusion in the Registration Statement or the Prospectus (or any supplement thereto). (c) The Redeemable Securities are convertible into Common Stock at a rate of 3.30 shares of Common Stock per Depositary Share. At the Execution Time, there were outstanding 250,000 shares of Preferred Shares; the redemption of all the outstanding Redeemable Securities had been duly authorized by the Company; by the close of business on the business day following the date of execution hereof, all the Redeemable Securities shall have been duly called for redemption in accordance with the Company's Certificate of the Powers, Designations, Preferences and Rights of the Preferred Shares ("Certificate") and the Deposit Agreement, dated as of September 1, 1985 ("Deposit Agreement") between the Company and The First National Bank of Boston (the "Depositary"); and the right to convert the Redeemable Securities into shares of Common Stock will, as a result of such call, expire at 5:00 P.M., New York City time, on the Conversion Date. A copy of the form of notice of redemption and the related letter of transmittal (collectively, the "Notice of Redemption") has been heretofore delivered to you. The Deposit Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms. The Preferred Shares have been duly and validly authorized and issued and are fully paid and nonassessable. (d) The Company has neither taken nor will take, directly or indirectly, any action designed to cause or result in, or that has constituted or that might reasonably be expected to cause or result in, stabilization or manipulation of the price of any security of the Company to facilitate the conversion of the Redeemable Securities. (e) The Company has neither paid nor given, nor will pay or give, directly or indirectly, any commission or other remuneration for soliciting the conversion of Redeemable Securities into Common Stock and cash. (f) Neither the issue and sale of the Securities (as defined in Section 2(b) hereof), nor the consummation of any other of the transactions herein contemplated, nor fulfillment of the terms hereof will conflict with, result in a breach or violation of, or constitute a default under any law or the charter or by-laws of the Company or the terms of any material indenture or other material agreement or instrument to which the Company or any of its subsidiaries is a party or bound or any 2 material judgment, order or decree applicable to the Company or any of its subsidiaries of any court, regulatory body, administrative agency, governmental body or arbitrator having jurisdiction over the Company or any of its subsidiaries. (g) The Company does not have a "significant subsidiary" within the meaning of Regulation S-X under the Act. (h) The terms which follow, when used in this Agreement, shall have the meanings indicated. The term "the Effective Date" shall mean each date that the Registration Statement and any post-effective amendment or amendments thereto became or become effective and each date after the date hereof on which a document incorporated by reference in the Registration Statement is filed. "Execution Time" shall mean the date and time that this Agreement is executed and delivered by the parties hereto. "Preliminary Prospectus" shall mean any preliminary prospectus referred to in paragraph (a) above and any preliminary prospectus included in the Registration Statement at the Effective Date that omits Rule 430A Information. "Prospectus" shall mean the prospectus relating to the Securities that is first filed pursuant to Rule 424(b) after the Execution Time or, if no filing pursuant to Rule 424(b) is required, shall mean the form of final prospectus relating to the Securities included in the Registration Statement at the Effective Date. "Registration Statement" shall mean the registration statement referred to in paragraph (a) above, including incorporated documents, exhibits and financial statements, as amended at the Execution Time (or, if not effective at the Execution Time, in the form in which it shall become effective) and, in the event any post-effective amendment thereto becomes effective prior to the Closing Date (as hereinafter defined), shall also mean such registration statement as so amended. Such term shall include any Rule 430A Information deemed to be included therein at the Effective Date as provided by Rule 430A. "Rule 415", "Rule 424", "Rule 430A" and "Regulation S-K" refer to such rules or regulation under the Act. "Rule 430A Information" means information with respect to the Securities and the offering thereof permitted to be omitted from the Registration Statement when it becomes effective pursuant to Rule 430A. Any reference herein to the Registration Statement, a Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or before the Effective Date of the Registration Statement or the issue date of such Preliminary Prospectus or the Prospectus, as the case may be; and any reference herein to the terms "amend", "amendment" or "supplement" with respect to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the filing of any document under the Exchange Act after the Effective Date of the Registration Statement, or the issue date of the Preliminary Prospectus or the Prospectus, as the case may be, deemed to be incorporated therein by reference. 2. PURCHASE OF SECURITIES. Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth: (a) The Purchaser agrees to surrender for conversion into Common Stock prior to 5:00 P.M., New York City time, on the Conversion Date all Redeemable Securities purchased by the Purchaser pursuant to Section 4 hereof or otherwise held by the Purchaser. The shares of Common Stock issued to the Purchaser upon the conversion of Redeemable Securities are referred to as the "Conversion Securities". (b) The Company agrees to sell to the Purchaser, and the Purchaser shall purchase from the Company, at a purchase price of $15.57 per share, such whole number of shares of Common Stock as would have been issuable upon conversion of all Redeemable Securities not surrendered for conversion. The shares of Common Stock to be purchased pursuant to this Section 2(b) are referred to as the "Purchased Securities" and, together with the Conversion Securities, the "Securities". (c) It is understood that the Purchaser intends to resell the Securities from time to time at prices prevailing in the open market. With respect to any Purchased Securities the Purchaser, on or prior to the fifteenth day after the Redemption Date, shall remit to the Company 50% of the excess, if 3 any, of the aggregate proceeds received by the Purchaser from the sale of such Purchased Securities (net of selling concessions, transfer taxes and other expenses of sale) over an amount equal to $15.57 multiplied by the number of such Purchased Securities sold by such Purchaser. Upon completion of the sale of the Securities, the Purchaser shall furnish to the Company a statement setting forth the aggregate proceeds received on the sale thereof and the applicable selling concessions, transfer taxes and other expenses of sale. For purposes of the foregoing determination, any Securities not sold by or for the account of the Purchaser prior to the close of business on the tenth day after the Redemption Date shall be deemed to have been sold on such tenth day for an amount equal to the last reported sale price of the Common Stock on such day. Nothing contained herein shall limit the right of the Purchaser, in its discretion, to determine the price or prices at which, or the time or times when, any Securities shall be sold, whether or not prior to the Redemption Date and whether or not for long or short account. (d) Delivery of and payment for the Purchased Securities shall be made at 10:00 A.M., New York City time, on April 22, 1994 (one business day after the Redemption Date), or if necessary to comply with the provisions of the Company's Amended and Restated Credit Agreement (Multicurrency) or Revolving Credit and Standby Letter of Credit Reimbursement Agreement, such earlier date as the Purchaser and the Company may agree (such date and time of delivery and payment for the Purchased Securities being herein called the "Closing Date"). Delivery of the Purchased Securities shall be made to the Purchaser against payment by the Purchaser of the purchase price thereof to or upon the order of the Company by wire transfer of immediately available funds. Delivery of the Purchased Securities shall be made at such location as the Purchaser shall reasonably designate at least one business day in advance of the Closing Date and payment for the Purchased Securities shall be made at the office of Latham & Watkins, 505 Montgomery Street, Suite 1900, San Francisco, California. Certificates for the Purchased Securities shall be registered in such names and in such denominations as the Purchaser may request. The Company agrees to have the Purchased Securities available for inspection, checking and packaging by the Purchaser in New York, New York prior to the Closing Date. 3. COMPENSATION. As compensation for the commitment of the Purchaser hereunder, the Company will pay to the Purchaser an amount equal to the sum of (i) $1,125,000 plus (ii) if the aggregate number of the Compensable Shares exceeds 412,500 shares, an additional $0.47 per Compensable Share for the aggregate number of all such Compensable Shares exceeding 412,500 shares. Compensable Shares consists of Purchased Securities plus any Conversion Securities which are resold by the Purchaser for less than $15.57 per share. Such compensation shall be paid to the Purchaser by wire transfer of immediately available funds on (A) if the Purchaser is required to purchase any Purchased Securities, the Closing Date, or (B) otherwise, as soon as practicable after the Conversion Date (but in no event later than two business days thereafter). 4. ADDITIONAL PURCHASES. The Purchaser may purchase Redeemable Securities, in the open market or otherwise, in such amounts and at such prices as the Purchaser may deem advisable. All Redeemable Securities so purchased will be converted by the Purchaser into Common Stock in accordance with Section 2(a) hereof. The Common Stock acquired by the Purchaser upon conversion of any Redeemable Securities acquired pursuant to this Section 4 may be sold at any time or from time to time by the Purchaser. It is understood that, for the purpose of stabilizing the price of the Common Stock or otherwise, the Purchaser may make purchases and sales of Common Stock, the Depositary Shares and the Depository Shares evidencing the Company's $32.50 Convertible Preferred Stock, in the open market or otherwise, for long or short account, on such terms as it may deem advisable and it may overallot in arranging sales. 4 5. AGREEMENTS. The Company agrees with the Purchaser that: (a) The Company will use its best efforts to cause the Registration Statement, if not effective at the Execution Time, and any amendment thereof, to become effective. Prior to the termination of the offering of the Securities, the Company will not file any amendment of the Registration Statement or supplement to the Prospectus unless the Company has furnished you a copy for your review prior to filing and will not file any such proposed amendment or supplement to which you reasonably object. Subject to the foregoing sentence, if the Registration Statement has become or becomes effective pursuant to Rule 430A, or filing of the Prospectus is otherwise required under Rule 424(b), the Company will cause the Prospectus, properly completed, and any supplement thereto to be filed with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the Purchaser of such timely filing. The Company will promptly advise the Purchaser (i) when the Registration Statement, if not effective at the Execution Time, and any amendment thereto, shall have become effective, (ii) when the Prospectus, and any supplement thereto, shall have been filed (if required) with the Commission pursuant to Rule 424(b), (iii) when, prior to termination of the offering of the Securities, any amendment to the Registration Statement shall have been filed or become effective, (iv) of any request by the Commission for any amendment of the Registration Statement or supplement to the Prospectus or for any additional information, (v) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the institution or threatening of any proceeding for that purpose and (vi) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose. The Company will use its best efforts to prevent the issuance of any such stop order and, if issued, to obtain as soon as possible the withdrawal thereof. (b) If, at any time when a prospectus relating to the Securities is required to be delivered under the Act, any event occurs as a result of which the Prospectus as then supplemented would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made not misleading, or if it shall be necessary to amend the Registration Statement or supplement the Prospectus to comply with the Act or the Exchange Act or the respective rules thereunder, the Company promptly will (i) prepare and file with the Commission, subject to the second sentence of paragraph (a) of this Section 5, an amendment or supplement which will correct such statement or omission or effect such compliance and (ii) supply any supplemented Prospectus to you in such quantities as you may reasonably request. (c) As soon as practicable, the Company will make generally available to its security holders and to the Purchaser an earnings statement or statements of the Company and its subsidiaries which will satisfy the provisions of Section 11(a) of the Act and Rule 158 under the Act. (d) The Company will furnish to the Purchaser and counsel for the Purchaser, without charge, signed copies of the Registration Statement (including exhibits thereto) and, so long as delivery of a prospectus by a Purchaser or dealer may be required by the Act, as many copies of each Preliminary Prospectus and the Prospectus and any supplement thereto as the Purchaser may reasonably request. The Company will pay the expenses of printing or other production of all documents relating to the transactions contemplated hereby. The Company will pay all the fees of the Depositary in connection with the performance of the transactions contemplated hereby and will pay all transfer taxes as may be imposed on the Purchaser in connection with their purchase of Redeemable Securities pursuant thereto. The Company will also pay all reasonable out of pocket expenses of the Purchaser, other than the fees and disbursements of Purchaser's counsel. (e) The Company will arrange for the qualification of the Securities for sale under the laws of such jurisdictions as the Purchaser may designate, and will maintain such qualifications in effect so long as required for the distribution of the Securities. 5 (f) The Company will (i) mail or cause to be mailed not later than the business day following the date of execution hereof the Notice of Redemption by first class mail to the registered holders of the Redeemable Securities as of March 16, 1994, which mailing will conform to the requirements of the Certificate and Deposit Agreement and (ii) publish an advertisement, in form and substance reasonably satisfactory to the Purchaser, relating to the redemption of the Redeemable Securities. The Company will not, and will ensure that the Depositary does not, withdraw or revoke the Notice of Redemption or attempt to do so. (g) The Company will direct the Depositary to advise the Purchaser daily of the amount of Redeemable Securities surrendered in the previous day for redemption or for conversion. (h) The Company will not take any action the effect of which would be to require an adjustment in the conversion price of the Redeemable Securities. (i) The Company will not, prior to the Conversion Date and for a period of 90 days following the Conversion Date, without the prior written consent of the Purchaser, offer, sell or contract to sell, or otherwise dispose of, directly or indirectly, or announce, or file for the registration of, the offering of, any other shares of Common Stock or any securities convertible into, or exchangeable for, shares of Common Stock; PROVIDED, HOWEVER, that the Company may issue and sell or register Common Stock pursuant to any employee stock option plan, stock ownership plan or dividend reinvestment plan of the Company in effect at the Execution Time and the Company may issue Common Stock issuable upon the conversion of securities or the exercise of warrants outstanding at the Execution Time; provided, further, that such restriction shall not apply if the Purchaser does not acquire any Securities pursuant to this Agreement. (j) The Company will cause its officers and directors to not, prior to the Closing Date, without the prior written consent of the Purchaser, offer, sell, or contract to sell, or otherwise dispose of, directly or indirectly, or announce, or file for the registration of, the offering of, and any other shares of Common Stock or any securities convertible into, or exchangeable for shares of Common Stock, except for the aggregate amount of 125,000 shares. (k) The Company confirms as of the date hereof that it is in compliance with all provisions of Section 1 of Laws of Florida, Chapter 92-198, AN ACT RELATING TO DISCLOSURE OF DOING BUSINESS WITH CUBA, and the Company further agrees that if it commences engaging in business with the government of Cuba or with any person or affiliate located in Cuba after the date the Registration Statement becomes or has become effective with the Securities and Exchange Commission or with the Florida Department of Banking and Finance (the "Department"), whichever date is later, or if the information reported in the Prospectus, if any, concerning the Company's business with Cuba or with any person or affiliate located in Cuba changes in any material way, the Company will provide the Department notice of such business or change, as appropriate, in a form acceptable to the Department. 6. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER. The obligations of the Purchaser hereunder to purchase any Purchased Securities shall be subject to the accuracy of the representations and warranties on the part of the Company contained herein as of the Execution Time, each Effective Date occurring after the Execution Time, the Conversion Date, and the Redemption Date and the Closing Date, to the accuracy of the statements of the Company made in any certificates pursuant to the provisions hereof, to the performance by the Company of its obligations hereunder and to the following additional conditions: (a) If the Registration Statement has not become effective prior to the Execution Time, unless the Purchaser agrees in writing to a later time, the Registration Statement will become effective not later than 6:00 P.M., New York City time, on the date hereof; if filing of the Prospectus, or any supplement thereto, is required pursuant to Rule 424(b), the Prospectus, and any such supplement, will be filed in the manner and within the time period required by Rule 424(b); and no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or threatened. 6 (b) On the date of this Agreement and on the Closing Date, the Company shall have furnished to the Purchaser the opinion of Latham & Watkins, counsel for the Company, and the opinion of the General Counsel of the Company, each dated the date of this Agreement and the Closing Date, in the respective forms previously approved by the Purchaser. In rendering such opinions, such counsel may rely (A) as to matters involving the application of laws of any jurisdiction other than the State of California or the United States, to the extent they deem proper and specified in such opinion, upon the opinion of other counsel of good standing whom they believe to be reliable and who are satisfactory to counsel for the Purchaser and (B) as to matters of fact, to the extent they deem proper, on certificates of responsible officers of the Company and public officials. References to the Prospectus in this paragraph (b) include any supplements thereto on the Closing Date. (c) On the date of this Agreement and on the Closing Date, the Purchaser shall have received from Munger, Tolles & Olson, counsel for the Purchaser, such opinion or opinions, dated the date of this Agreement and the Closing Date, respectively, with respect to the issuance and sale of the Securities, the Registration Statement, the Prospectus (together with any supplement thereto) and other related matters as the Purchaser may reasonably require, and the Company shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters. (d) On the date of this Agreement, and on each Effective Date occurring after the Execution Time and on the Closing Date, the Company shall have furnished to the Purchaser a certificate of the Company, signed by the Chairman of the Board or the President and the principal financial or accounting officer of the Company, dated the date of delivery, to the effect that the signers of such certificate have carefully examined the Registration Statement, the Prospectus, any supplement to the Prospectus and this Agreement and that: (i) the representations and warranties of the Company in this Agreement are true and correct in all material respects on and as of the date of such certificate as if made on the date of such certificate and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the date of such certificate; (ii) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or, to the Company's knowledge, threatened; and (iii) since the date of the most recent financial statements included in the Prospectus (exclusive of any supplement thereto), there has been no material adverse change in the condition (financial or other), earnings, business or properties of the Company and its subsidiaries, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Prospectus (exclusive of any supplement thereto). (e) At the Execution Time, and on each Effective Date occurring after the Execution Time on which financial information is included or incorporated in the Registration Statement or the Prospectus and on the Closing Date, KPMG Peat Marwick shall have delivered to the Purchaser a letter or letters, dated as of the date of delivery, in form and substance satisfactory to the Purchaser, confirming that they are independent accountants within the meaning of the Act and the Exchange Act and the respective applicable published rules and regulations thereunder and stating in effect that: (i) in their opinion the audited financial statements and financial statement schedules and any pro forma financial statements included or incorporated in the Registration Statement and the Prospectus and reported on by them comply in form in all material respects with the applicable accounting requirements of the Act and the Exchange Act and the related published rules and regulations; 7 (ii) on the basis of a reading of the latest unaudited financial statements made available by the Company and its subsidiaries: carrying out certain specified procedures (but not an examination in accordance with generally accepted auditing standards) which would not necessarily reveal matters of significance with respect to the comments set forth in such letter; a reading of the minutes of the meetings of the stockholders, directors and specified committees of the Company and its Subsidiaries; and inquiries of certain officials of the Company who have responsibility for financial and accounting matters of the Company and its subsidiaries as to transactions and events subsequent to the date of the most recent audited financial statements included or incorporated in the Registration Statement and the Prospectus, nothing came to their attention which caused them to believe that: (1) any unaudited financial statements included or incorporated in the Registration Statement and the Prospectus do not comply in form in all material respects with applicable accounting requirements and with the published rules and regulations of the Commission with respect to financial statements included or incorporated in quarterly reports on Form 10-Q under the Exchange Act; and said unaudited financial statements are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the audited financial statements included or incorporated in the Registration Statement and the Prospectus; or (2) with respect to the period subsequent to the date of the most recent financial statements, audited or unaudited, included or incorporated in the Registration Statement and the Prospectus, there were any changes, at a specified date not more than five business days prior to the date of the letter, in the capital stock or consolidated long-term debt or consolidated short-term debt of the Company or decreases in the consolidated net current assets, net assets or shareholders' equity of the Company as compared with the amounts shown on the most recent consolidated balance sheet included or incorporated in the Registration Statement and the Prospectus, or for the period from the date of the most recent financial statements included or incorporated in the Registration Statement and the Prospectus to such specified date there were any decreases, as compared with the corresponding period in the preceding year in consolidated net sales or in total or per share amounts of net income from continuing operations or in net income, except in all instances for changes or decreases set forth in such letter, in which case the letter shall be accompanied by an explanation by the Company as to the significance thereof unless said explanation is not deemed necessary by the Purchaser; (iii) they have performed certain other specified procedures as a result of which they determined that certain information of an accounting, financial or statistical nature (which is limited to accounting, financial or statistical information derived from the general accounting records of the Company and its subsidiaries) set forth in the Registration Statement and the Prospectus, including the information set forth under the captions "Price Range of Common Stock and Divided Policy," "Capitalization," and "Selected Financial Data," the information included or incorporated in Items 1, 2, 6, 7 and 11 of the Company's Annual Report on Form 10-K, incorporated in the Registration Statement and the Prospectus, the information included in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" included or incorporated in any of the Company's Quarterly Reports on Form 10-Q incorporated in the Registration Statement and the Prospectus and any such information appearing in any Current Report on Form 8-K incorporated in the Registration Statement and the Prospectus, agrees with the accounting records of the Company and its subsidiaries, excluding any questions of legal interpretation. References to the Prospectus in this paragraph (e) include any supplement thereto at the date of the letter. 8 (f) Subsequent to the Execution Time or, if earlier, the dates as of which information is given in the Registration Statement (exclusive of any amendment thereof) and the Prospectus (exclusive of any supplement thereto), there shall not have been (i) any change or decrease specified in the letter or letters referred to in paragraph (e) of this Section 6 or (ii) any change, or any development involving a prospective change, in or affecting the business or properties of the Company and its subsidiaries the effect of which, in any case referred to in clause (i) or (ii) above, is, in the judgment of the Purchaser, so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Securities as contemplated by the Registration Statement (exclusive of any amendment thereof) and the Prospectus (exclusive of any supplement thereto). (g) The Company shall have furnished to the Purchaser such further information, certificates and documents as the Purchaser may reasonably request. If any of the conditions specified in this Section 6 shall not have been fulfilled in all material respects when and as provided in this Agreement, or if any of the opinions and certificates mentioned above or elsewhere in this Agreement shall not be in all material respects reasonably satisfactory in form and substance to the Purchaser and its counsel, this Agreement and all obligations of the Purchaser hereunder may be cancelled at, or at any time prior to, the Closing Date by the Purchaser. Notice of such cancellation shall be given to the Company in writing or by telephone or telegraph confirmed in writing. The documents required to be delivered by this Section 6 shall be delivered at the office of Munger, Tolles & Olson, counsel for the Purchaser, at 355 South Grand Avenue, 35th Floor, Los Angeles, California 90071-1560, on the date of this Agreement or on the Closing Date, as applicable. 7. REIMBURSEMENT OF PURCHASER'S EXPENSES. If the sale of the Securities provided for herein is not consummated because any condition to the obligations of the Purchaser set forth in Section 6 hereof is not satisfied, because of any termination pursuant to Section 11 hereof or because of any refusal, inability or failure on the part of the Company to perform any agreement herein or comply with any provision hereof other than by reason of a default by the Purchaser, the Company will reimburse the Purchaser upon demand for all out-of-pocket expenses (including reasonable fees and disbursements of counsel) that shall have been incurred by them in connection with the proposed purchase and sale of the Securities. 8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to indemnify and hold harmless the Purchaser, the directors, officers, employees and agents of the Purchaser and each person who controls the Purchaser within the meaning of either the Act or the Exchange Act against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Act, the Exchange Act or other Federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the registration statement for the registration of the Securities as originally filed or in any amendment thereof, or in any Preliminary Prospectus or the Prospectus, or in any amendment thereof or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and agrees to reimburse each such indemnified party, as incurred, for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage or liability or action; PROVIDED, HOWEVER, that the Company will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Purchaser through the Purchaser specifically for inclusion therein. This indemnity agreement will be in addition to any liability which the Company may otherwise have. (b) The Purchaser severally agrees to indemnify and hold harmless the Company, each of its directors, each of its officers who signs the Registration Statement, and each person who controls 9 the Company within the meaning of either the Act or the Exchange Act, to the same extent as the foregoing indemnity from the Company to the Purchaser, but only with reference to the statements set forth in the last paragraph of the cover page and under the heading "Standby Arrangements" in any Preliminary Prospectus and the Prospectus. This indemnity agreement will be in addition to any liability which the Purchaser may otherwise have. (c) Promptly after receipt by an indemnified party under this Section 8 of notice of the commencement of any action, such indemnified party will, 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 commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party's choice at the indemnifying party's expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties except as set forth below): provided, however, that such counsel shall be satisfactory to the indemnified party. Notwithstanding the indemnifying party's election to appoint counsel to represent the indemnified party in an action, the indemnified party shall have the right to employ separate counsel (including local counsel), and the indemnifying party shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the indemnified party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, (iii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party. An indemnifying party will not, without the prior written consent of the indemnified parties, settle or comprise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding. (d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 8 is unavailable to or insufficient to hold harmless an indemnified party for any reason, the Company and the Purchaser agrees to contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending same) (collectively "Losses") to which the Company and the Purchaser may be subject in such proportion as is appropriate to reflect the relative benefits received by Company and by the Purchaser from the offering of the Securities; PROVIDED, HOWEVER, that in no case shall the Purchaser be responsible for any amount in excess of the fees payable by the Company to the Purchaser pursuant to Section 3 hereof. If the allocation provided by the immediately preceding sentence is unavailable for any reason, the Company and the Purchaser shall contribute in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company and of the Purchaser in connection with the statements or omissions which resulted in such Losses as well as any other relevant equitable considerations. Benefits received by the Company shall be deemed to be equal to the sum of (i) the principal amount of Redeemable Securities converted by the Purchaser pursuant to Section 2(a) hereof and (ii) the net amount paid by the Purchaser to the Company at the Closing, and benefits received by the Purchaser shall be deemed to be equal to the 10 total fees payable by the Company to the Purchaser pursuant to Section 3 hereof. Relative fault shall be determined by reference to whether any alleged untrue statement or omission relates to information provided by the Company or the Purchaser. The Company and the Purchaser agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 8, each person who controls the Purchaser within the meaning of either the Act or the Exchange Act and each director, officer, employee and agent of the Purchaser shall have the same rights to contribution as the Purchaser, and each person who controls the Company within the meaning of either the Act or the Exchange Act, each officer of the Company who shall have signed the Registration Statement and each director of the Company shall have the same rights to contribution as the Company, subject in each case to the applicable terms and conditions of this paragraph (d). 9. SOLICITING CONVERSIONS. The Purchaser may assist the Company in soliciting conversion of the Redeemable Securities by the holder thereof but shall not be entitled to compensation by the Company for any such assistance. 10. TERMINATION. This Agreement shall be subject to termination in the absolute discretion of the Purchaser, by notice given to the Company at any time prior to the Closing Date, if prior to such time (i) (a) trading in the Company's Common Stock shall have been suspended by the Commission or the New York Stock Exchange or trading in the Redeemable Securities shall have been suspended by the Commission or the New York Stock Exchange during the five business days prior to the Redemption Date (other than if trading is resumed within one hour), or (b) trading in securities generally on the New York Stock Exchange shall have been suspended or limited or minimum prices shall have been established on such Exchange, (ii) a banking moratorium shall have been declared either by Federal or New York State authorities or (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national emergency or war or other calamity or crisis the effect of which on financial market is such as to make it, in the judgment of the Purchaser, impracticable or inadvisable to proceed with the offering or delivery of the Securities as contemplated by the Prospectus (exclusive of any supplement thereto). 11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective agreements, representations, warranties, indemnities and other statements of the Company or its officers and of the Purchaser set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of the Purchaser or the Company or any of the officers, directors or 11 controlling persons referred to in Section 8 hereof, and will survive the conversion of any Redeemable Securities and the delivery of and payment for any securities. The provisions of Section 7 and 8 hereof shall survive the termination or cancellation of this Agreement. 12. NOTICES. All communications hereunder will be in writing and effective only on receipt, and, if sent to the Purchaser, will be mailed, delivered or telegraphed and confirmed to it at Seven World Trade Center, New York, New York 10048; or, if sent to the Company, will be mailed, delivered or telegraphed and confirmed to it at 2900 Semiconductor Drive, Santa Clara, California 95052, attention of the legal department. 13. SUCCESSORS. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers and directors and controlling persons referred to in Section 8 hereof, and no other person will have any right or obligation hereunder. 14. APPLICABLE LAW. This Agreement will be governed by and construed in accordance with the laws of the State of New York. If the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a binding agreement between the Company and the Purchaser. Very truly yours, NATIONAL SEMICONDUCTOR CORPORATION By: ----------------------------------- President and CEO The foregoing Agreement is hereby confirmed and accepted as of the date first above written. Salomon Brothers Inc By: ----------------------------------- Vice President 12 EX-4.A 3 EXHIBIT 4A SECOND RESTATED CERTIFICATE OF INCORPORATION OF NATIONAL SEMICONDUCTOR CORPORATION NATIONAL SEMICONDUCTOR CORPORATION, a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows: 1. The name of the corporation is NATIONAL SEMICONDUCTOR CORPORATION. The date of filing its original Certificate of Incorporation with the Secretary of State was May 27, 1959. The First Restated Certificate of Incorporation was filed with the Secretary of State on April 27, 1970. 2. This Second Restated Certificate of Incorporation only restates and integrates and does not further amend the provisions of the Certificate of Incorporation of this corporation as heretofore amended or supplemented and there is no discrepancy between those provisions and the provisions of this Restated Certificate of Incorporation. 3. The text of the Certificate of Incorporation as amended or supplemented heretofore is hereby restated without further amendments or changes to read as herein set forth in full: FIRST: The name of the corporation is NATIONAL SEMICONDUCTOR CORPORATION. 1 SECOND: Its principal office in the State of Delaware is located at 1209 Orange Street, in the City of Wilmington, County of New Castle. The name and address of its resident agent is The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware 19801. THIRD: The nature of the business, the objects or purposes to be transacted, promoted or carried on, are: To engage in the manufacture, production and fabrication of; to buy or otherwise acquire, import, store, repair, service, maintain, sell, assign, distribute, export and otherwise dispose of; and generally to trade and deal in and with, as principal agent or otherwise, transistors, diodes, rectifiers, photo devices and electronic assemblies and equipment of every type and description and all parts, materials, accessories, supplies, appliances, tools, and devices used or useful in connection with or incidental to any of the foregoing. To buy, sell, hold, transfer, mortgage, assign and lease real property and equipment which may be necessary or useful in connection with the transaction of the business of this corporation. To build, purchase, lease as lessee or otherwise acquire, own, hold, use, improve, equip and maintain, mortgage, convey in trust, or otherwise encumber, sell, convey, assign, lease as lessor, and otherwise dispose of factories, shops, laboratories, offices, warehouses, and any and all buildings and structures which may be necessary or useful in connection with the transaction of the business of this corporation. To manufacture, purchase or otherwise acquire, invest in, own, mortgage, pledge, sell, assign and transfer or otherwise dispose of, trade, deal in and deal with goods, wares and merchandise and personal property of every class and description. To acquire, and pay for in cash, stock or bonds of this corporation or otherwise, the good will, rights, assets and property, and to undertake or assume the whole or any part of the obligations or liabilities of any person, firm, association or corporation. To acquire, hold, use, sell, assign, lease grant licenses in respect of, mortgage or otherwise dispose of letters patent 2 of the United States or any foreign country, patent rights, licenses and privileges, inventions, improvements and processes, copyrights, trademarks, and trade names, relating to or useful in connection with any business of this corporation. To acquire by purchase, subscription or otherwise, and to receive, hold, own, guarantee, sell, assign, exchange, transfer, mortgage, pledge or otherwise dispose of or deal in and with any of the shares of the capital stock, or any voting trust certificates in respect of the shares of capital stock, scrip, warrants, rights, bonds, debentures, notes, trust receipts, and other securities, obligations, choses in action and evidences of indebtedness or interest issued or created by any corporations, joint stock companies, syndicates, associations, firms, trusts or persons, public or private, or by the government of the United States of America, or by any foreign government, or by any state, territory, province, municipality or other political subdivision or by any governmental agency, and as owner thereof to possess and exercise all the rights, powers, and privileges of ownership, including the right to execute consents and vote thereon, and to do any and all acts and things necessary or advisable for the preservation, protection, improvement and enhancement in value thereof. To enter into, make and perform contracts of every kind and description with any person, firm, association, corporation, municipality, county, state, body politic or government or colony or dependency thereof. To borrow or raise moneys for any of the purposes of the corporation and, from time to time without limit as to amount, to draw, make, accept, endorse, execute and issue promissory notes, drafts, bills of exchange, warrants, bonds, debentures and other negotiable or non-negotiable instruments and evidences of indebtedness, and to secure the payment of any thereof and of the interest thereon by mortgage upon or pledge, conveyance or assignment in trust of the whole or any part of the property of the corporation, whether at the time owned or thereafter acquired, and to sell, pledge or otherwise dispose of such bonds or other obligations of the corporation for its corporate purposes. To loan to any person, firm or corporation any of its surplus funds, either with or without security. To purchase, hold, sell and transfer the shares of its own capital stock; provided it shall not use its funds or property for the purchase of its own shares of capital stock when such use would cause any impairment of its capital except as otherwise permitted by law, and provided further that 3 shares of its own capital stock belonging to it shall not be voted upon directly or indirectly. To have one or more offices, to carry on all or any of its operations and business and without restriction or limit as to amount to purchase or otherwise acquire, hold, own, mortgage, sell, convey or otherwise dispose of, real and personal property of every class and description in any of the states, districts, territories or colonies of the United States, and in any and all foreign countries, subject to the laws of such state, district, territory, colony or country. In general, to carry on any other business in connection with the foregoing, and to have and exercise all the powers conferred by the laws of Delaware upon corporations formed under the General Corporation Law of the State of Delaware, and to do any or all of the things hereinbefore set forth to the same extent as natural persons might or could do. The objects and purposes specified in the foregoing clauses shall, except where otherwise expressed, be, in nowise limited or restricted by reference to, or inference from, the terms of any other clause in this certificate of incorporation, but the objects and purposes specified in each of the foregoing clauses of this article shall be regarded as independent objects and purposes. FOURTH: The total number of shares of stock which the Corporation shall have authority to issue is Two Hundred and One Million (201,000,000), consisting of One Million (1,000,000) shares of preferred stock, par value of Fifty Cents ($.50) each (hereinafter called the Preferred Stock) and Two Hundred Million (200,000,000) shares of common stock of par value of Fifty Cents ($.50) each (hereinafter called the Common Stock). The designations and the powers, preferences and rights, and the qualification, limitations or restrictions thereof, of each class of stock of the Corporation which are fixed by this Certificate of Incorporation, and the express grant of authority to the Board of Directors to fix by resolution or resolutions the designations, and the powers, preferences and rights, and the 4 qualifications, limitations or restrictions thereof, of the Preferred Stock which are not fixed by this Certificate of Incorporation, are as follows: A. PREFERRED STOCK (1) Shares of Preferred Stock may be issued from time to time in one or more series, each such series to have such distinctive designation as shall be stated and expressed in the resolution or resolutions adopted by the Board of Directors providing for the initial issuance of shares of such series, and authority is expressly vested in the Board of Directors, by such resolution or resolutions providing for the initial issuance of shares of each series: (a) To fix the distinctive designation of such series and the number of shares which shall constitute such series, which number may be increased or decreased (but not below the number of shares thereof then outstanding) from time to time by actions of the Board of Directors; (b) To fix (i) the dividend rate of such series, (ii) any limitation, restrictions or conditions on the payment of dividends, including whether dividends shall be cumulative and, if so, from which date or dates, (iii) the relative rights of priority, if any, of payment of dividends on shares of that series and (iv) the form of dividends, which shall be payable either (A) in cash only, or (B) in stock only, or (C) partly in cash and partly in stock, or (D) in stock or, at the option of the holder, in cash (and in such case to prescribe the terms and conditions of exercising such option), and to make provision in case of dividends payable in stock for adjustments of the dividend rate in such events as the Board of Directors shall determine; (c) To fix the price or prices at which, and the terms and conditions on which, the shares of such series may be redeemed by the Company; (d) To fix the amount or amounts payable upon the shares of such series in the event of any liquidation, dissolution or winding up of the Company and the relative rights of priority, if any, of payment upon shares of such series; (e) To determine whether or not the shares of such series shall be entitled to the benefit of a sinking fund to be applied to the purchase or redemption of such series and, if so entitled, the amount of such fund and the manner of its application; 5 (f) To determine whether or not the shares of such series shall be made convertible into, or exchangeable for, shares of any other class or classes of stock of the Corporation or shares of any other series of Preferred Stock, and, if made so convertible or exchangeable, the conversion price or prices, or the rate or rates of exchange, and the adjustments thereof, if any, at which such conversion or exchange may be made, and any other terms and conditions of such conversion or exchange; (g) To determine whether or not the shares of such series shall have any voting powers and, if voting powers are so granted, the extent of such voting powers, provided that the number of authorized share of Common Stock may be increased or decreased by the affirmative vote of the holders of a majority of the Common Stock, voting as a class, and such increase or decrease shall not require any actions by holders of shares of Preferred Stock. Except as otherwise provided by statute or by a determination by the Board of Directors, the holders of shares of Preferred Stock, as such holders, shall not have any right to vote in the election of directors or for any other purpose; and such holders shall not be entitled to notice of any meeting of stockholders at which they are not entitled to vote; (h) To determine whether or not the issue of any additional shares of such series or of any other series in addition to such series shall be subject to restrictions in addition to the restrictions, if any, on the issue of additional shares imposed in the resolution or resolutions fixing the terms of any outstanding series of Preferred Stock theretofore issued pursuant to this Section A and, if subject to additional restrictions, the extent of such additional restrictions; and (i) Generally to fix the other rights, and any qualifications, limitations or restrictions of such rights, of such series; provided, however, that no such rights, qualifications, limitations or restrictions shall be in conflict with this Certificate of Incorporation or any amendment hereof. (2) Before any dividends shall be declared or paid or any distribution ordered or made upon the Common Stock (other than a dividend payable in Common Stock), the Corporation shall comply with the dividend and sinking fund provisions, if any, of any resolution or resolutions providing for the issue of any series of Preferred Stock any shares of which shall at the time be outstanding. Subject to the foregoing sentence, the holders of Common Stock shall be entitled, to the exclusion of the holders of Preferred Stock of any and all series, to receive such dividends as from time to time may be declared by the Board of Directors. 6 (3) Upon any liquidation, dissolution or winding up of the Corporation, the holders of Preferred Stock of each series shall be entitled to receive the amount to which such holders are entitled as fixed with respect to such series, including all dividends accumulated to the date of final distribution, before any payment or distribution of assets of the Corporation shall be made to or set apart for the holders of Common Stock; and after such payments shall have been made to or set apart for the holders of Common Stock; and after such payments shall have been made in full to the holders of Preferred Stock, the holders of Common Stock shall be entitled to receive any and all assets remaining to be paid or distributed to stockholders and the holders of Preferred Stock shall not be entitled to share therein. For the purposes of this paragraph, the voluntary sales, conveyance, lease, exchange or transfer of all or substantially all the property or assets of the Corporation or a consolidation or merger of the Corporation with one or more other corporation (whether or not the Corporation is the Corporation surviving such consolidation or merger) shall not be deemed to be a liquidation, dissolution or winding up, voluntary or involuntary. (4) Subject to such limitations (if any) as may be fixed by the Board of Directors with respect to such series of Preferred Stock in accordance with paragraph (1) of this Section A, Preferred Stock of each series may be redeemed at any time in whole or from time to time in part, at the option of the Corporation, by vote of the Board of Directors, at the redemption price thereof fixed in accordance with said paragraph (1). If less than all the outstanding shares of Preferred Stock of such series are to be redeemed, the shares to be redeemed shall be determined in such manner as the Board of Directors shall prescribe. At such time or times prior to the date fixed for redemption as the Board of Directors shall determine, written notice shall be mailed to each holder of record of shares to be redeemed, in a postage prepaid envelope addressed to such holder at his address as shown by the records of the Corporation, notifying such holders of the election of the Corporation to redeem such shares and stating the date fixed for the redemption thereof and calling upon such holder to surrender to the Corporation on or after said date, at a place designated in such notice, his certificate or certificates representing the number of shares specified in such notice of redemption. On and after the date fixed in such notice of redemption, each holder of shares of preferred Stock to be redeemed shall present and surrender his certificate or certificates for such shares to the Corporation at the place designated in such notice and thereupon the redemption price of such shares shall be paid to or on the order of the person whose name appears on the records of the Corporation as the holder of the shares designated for redemption. In case less than all the shares represented by any such certificate are redeemed a new certificate shall be issued representing the unredeemed shares. From and after the date fixed in any such notice as the date of redemption (unless default shall 7 be made by the Corporation in payment of the redemption price) all dividends on the shares of Preferred Stock designated for redemption in such notice shall cease to accrue and all rights of the holders thereof as stockholders of the Corporation, other than to receive the redemption price, shall terminate and such shares shall not thereafter be transferred (except with the consent of the Corporation) on the books of the Corporation and such shares shall not be deemed to be outstanding for any purpose whatsoever. At any time after the mailing of any such notice of redemption the Corporation may deposit the redemption price of the shares designated therein for redemption with a bank or trust company in the United States of America, having capital and surplus of at least $25,000,000 in trust for the benefit of the respective holders of the shares designated for redemption but not yet redeemed. From and after the making of such deposit the sole right of the holders of such shares shall be the right either to receive the redemption price of such shares on and after such redemption date, or, in the case of shares having conversion rights, the right to convert the same at any time at or before the earlier of the close of business on such redemption date or such prior date and time at which the right to convert shall have expired; and except for these rights, the shares of Preferred Stock so designated for redemption shall not be deemed to be outstanding for any purpose whatsoever. (5) Shares of any series of Preferred Stock which have been redeemed (whether through the operation of a sinking fund or otherwise) or purchased by the Corporation, or which, if convertible, have been converted into shares of stock of the corporation of any other class or classes, may, upon appropriate filing and recording to the extent required by law, have the status of authorized and unissued shares of Preferred Stock and may be reissued as part of such series or of any other series of Preferred Stock, subject to such limitations (if any) as may be fixed by the Board of Directors with respect to such series of Preferred Stock in accordance with paragraph (1) of this Section A. B. COMMON STOCK (1) Except as otherwise provided by (a) the Board of Directors in fixing the voting rights of any series of the Preferred Stock in accordance with Section A of this Article FOURTH or (b) statute, voting power in the election of directors and for all other purposes shall be vested exclusively in the holders of the Common Stock. (2) In the event of any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary after payment shall have been made to the holders of the Preferred Stock of the full amount to which they shall be entitled pursuant to paragraph (3) of Section A of this Article FOURTH, the holders of Common Stock shall be entitled, to the exclusion of the holders of 8 the Preferred Stock of any and all series, to share, ratably according to the number of shares of Common Stock held by them, in all remaining assets of the Corporation available for distribution to its stockholders. All persons who shall acquire stock in this Corporation shall acquire the same subject to the provisions of this Certificate of Incorporation, as amended. FIFTH: The minimum amount of capital with which the corporation will commence business is One thousand dollars ($1,000.00). SIXTH: The names and places of residence of the incorporators are as follows: NAMES RESIDENCES ----- ---------- R. F. Westover Wilmington, Delaware L.A. Schoonmaker Wilmington, Delaware A.D. Atwell Wilmington, Delaware SEVENTH: The corporation is to have perpetual existence. EIGHTH: The private property of the stockholders shall not be subject to the payment of corporate debts to any extent whatever. NINTH: In furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized: To make, alter or repeal the by-laws of the corporation. To authorize and cause to be executed mortgages and liens upon the real and personal property of the corporation. To set apart out of any of the funds of the corporation available for dividends a reserve or reserves for any proper purpose and to abolish any such reserve in the manner in which it was created. 9 By resolution passed by a majority of the whole board, to designate one or more committees, each committee to consist of two or more of the Directors of the corporation, which, to the extent provided in the resolution or in the by-laws of the corporation, shall have and may exercise the powers of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it. Such committee or committees shall have such name or names as may be stated in the by-laws of the corporation or as may be determined from time to time by resolution adopted by the Board of Directors. When and as authorized by the affirmative vote of the holders of a majority of the stock issued and outstanding having voting power given at a stockholders' meeting duly called for that purpose, or when authorized by the written consent of the holders of a majority of the voting stock issued and outstanding, to sell, lease or exchange all of the property and assets of the corporation, including its good will and its corporate franchises, upon such terms and conditions and for such consideration, which may be in whole or in part shares of stock in, and/or other securities of, any other corporation or corporations, as its Board of Directors shall deem expedient and for the best interests of the corporation. TENTH: Whenever a compromise or arrangement is proposed between this corporation and its creditors or any class of them and/or between this corporation and its stockholders or any class of them, any court of equitable jurisdiction within the state of Delaware may, on the application in a summary way of this corporation or of any creditor or stockholder thereof, or on the application of any receiver or receivers appointed for this corporation under the provisions of section 291 of Title 8 of the Delaware Code or on the application of trustees in dissolution or of any receiver or receivers appointed for this corporation under the provisions of section 279 of Title 8 of the Delaware Code, order a meeting of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this corporation, as 10 the case may be, to be summoned in such manner as the said court directs. If a majority in number representing three-fourths in value of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this corporation, as the case may be, agree to any compromise or arrangement and to any reorganization of this corporation as consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors, and/or on all the stockholders or class of stockholders, of this corporation, as the case may be, and also on this corporation. ELEVENTH: Meetings of stockholders may be held outside of the State of Delaware, if the by-laws so provide. The books of the corporation may be kept (subject to any provision contained in the statutes) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the by-laws of the corporation. Elections of Directors need not be by ballot unless the by-laws of the corporation shall so provide. TWELFTH: No holder of stock now or hereafter authorized of any class of the corporation shall be entitled as of right to subscribe for or purchase any part of any new or additional issue of stock now or hereafter authorized of any class of the corporation, or of any stock now or hereafter authorized of any class of the corporation reacquired by it after the issue thereof, or of any bonds, debentures, notes or other obligations convertible 11 into any stock now or hereafter authorized of any class of the corporation, or of any warrants, options or other instruments conferring upon the holder or owner thereof the right to subscribe for or purchase any such stock. THIRTEENTH: No director of the corporation shall be liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under section 174 of Delaware General Corporation Law or successor provision thereto or (iv) for any transaction from which the director derived an improper personal benefit. Every person who is or has been a director, officer, employee or agent of this corporation shall be indemnified by the corporation to the full extent permitted by applicable law against expenses reasonably incurred by him in connection with any action, suit or proceeding to which he may be a party defendant, or with which he shall be threatened by reason of his being or having been a director, officer, employee or agent of the corporation. The term "expenses" includes attorney's fees, judgments, fines and amounts paid in settlement. The foregoing right of indemnification shall be in addition to any other rights to which any such director, officer, employee or agent may be entitled as a matter of law. 12 FOURTEENTH: A Director or officer of this corporation shall not be disqualified by his office from dealing or contracting with the corporation as a vendor, purchaser, employee, agent or otherwise; nor shall any transaction, contract or act of this corporation be voided or voidable or in any way affected or invalidated by reason of the fact that any director or officer or any firm of which such director or officer is a member or any corporation of which such director or officer is a shareholder, director or officer is in any way interested in such transaction, contract or act, provided the fact that such director, officer, firm or corporation so interested shall be disclosed or shall be known to the Board of Directors or such members thereof as shall be present at any meeting of the Board of Directors at which action upon any such contract, transaction or act shall be taken; nor shall any such director or officer be accountable or responsible to the corporation for or in respect of any such transaction, contract or act of this corporation or for any gains or profits realized by him by reason of the fact that he or any firm of which he is member or any corporation of which he is a shareholder, officer or director is interested in such transaction, contract or act; and any such director or officer, if such officer is a director, may be counted in determining the existence of a quorum at any meeting of the Board of Directors of the corporation which shall authorize or take action in respect of any such contract, transaction or act, and may vote thereat to authorize, ratify or approve any such contract, transaction or act, with like force and effect as if he or any firm of which he is a member or any 13 corporation of which he is a shareholder, officer or director were not interested in such transaction, contract or act. FIFTEENTH: The corporation reserves the right to amend, alter, change or repeal any provision contained in this certificate of incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation. 4. This Second Restated Certificate of Incorporation was duly adopted by the board of directors in accordance with Section 245 of The General Corporation Law of the State of Delaware. 5. That the capital of said corporation will not be reduced under or by reason of any amendment in this Restated Certificate of Incorporation. IN WITNESS WHEREOF, said NATIONAL SEMICONDUCTOR CORPORATION has caused its corporate seal to be hereunto affixed and this certificate to signed by PETER J. SPRAGUE, Chairman of its Board of Directors, and attested by JOHN M. CLARK III, its secretary this 3rd day of February, 1994. --- -------- NATIONAL SEMICONDUCTOR CORPORATION By/s/ PETER J. SPRAGUE ------------------------------------------ Peter J. Sprague, Chairman of the Board of Directors (CORPORATE SEAL) ATTEST: By JOHN M. CLARK III ---------------------- John M. Clark III Secretary 14 EX-4.C 4 EXHIBIT 4C NATIONAL SEMICONDUCTOR CORPORATION CERTIFICATE OF THE POWERS, DESIGNATIONS, PREFERENCES AND RIGHTS OF THE $32.50 CONVERTIBLE PREFERRED STOCK PAR VALUE $.50 PER SHARE LIQUIDATION VALUE $500 PER SHARE PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE The undersigned, a Vice President of National Semiconductor Corporation, a Delaware corporation (the "Company"), DOES HEREBY CERTIFY that the following resolutions have been duly adopted by the Board of Directors of the Company: RESOLVED, that pursuant to the authority expressly granted to and vested in the Board of Directors of the Company by the provisions of the Restated Certificate of Incorporation, this Board of Directors hereby authorizes the issuance of a series of the Preferred Stock of the Company (the "Preferred Stock") which shall consist of 345,000 shares of the Company's Preferred Stock, and this Board of Directors hereby fixes the powers, designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof, of the shares of such series (in addition to the powers, designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof, set forth in the Restated Certificate of Incorporation of the Company which are applicable to the Preferred Stock) as follows: (i) DESIGNATION. The designation of said series of the Preferred Stock shall be the $32.50 Convertible Preferred Shares ("this Series"). The number of shares of this Series shall be 345,000. The liquidation value of this Series shall be $500 per share. (ii) DIVIDENDS. The dividend rate on shares of this Series shall be $32.50 per share per annum. Dividends on shares of this Series shall be fully cumulative and shall accrue, without interest, from the date of issuance of such shares, and shall be payable quarterly, when and as declared by the Board of Directors out of funds legally available for the payment of dividends, on each Dividend Payment Date. Each such dividend shall be payable in arrears to the holders of record of shares of this Series, as they appear on the stock records of the Company at the close of business on such record dates, not more than 60 days preceding the payment dates thereof, as shall be fixed by the Board of Directors. Accrued and unpaid dividends for any past Dividend Periods may be declared and paid at any time, without reference to any Dividend Payment Date, to holders of record on such date, not exceeding 45 days preceding the payment date thereof, as may be fixed by the Board of Directors. The amount of dividends payable for each full Dividend Period for this Series shall be computed by dividing the annual dividend rate by four. The amount of dividends payable for the initial Dividend Period, or any other period shorter or longer than a full Dividend Period, on this Series shall be computed on the basis of twelve 30-day months and a 360-day-year. Holders of shares of this Series shall be entitled to receive such dividends in preference to and in priority over dividends upon the Common Shares and all Junior Shares. Shares of this Series shall be junior as to dividends to all Senior Shares, and if at any time the Company has failed to make a sinking fund or mandatory redemption payment with respect to Senior Shares, the Company shall not declare or pay any dividend on shares of this Series or redeem any shares of this Series. The holders of shares of this Series shall not be entitled to any dividends other than the cash dividends provided in this Clause (ii). If at any time the Company has failed to pay accrued dividends on any shares of this Series or any Parity Shares at the time outstanding at the times such dividends are payable, the Company shall not (a) declare or pay any dividend on the Common Shares or on any Junior Shares or make any payment on account of, or set apart money for, a sinking or other analogous fund for, the purchase, 1 redemption or other retirement of, any Common Shares or any Junior Shares or make any distribution in respect thereof, either directly or indirectly and whether in cash or property or in obligations or shares of the Company (other than in Common Shares or Junior Shares), (b) purchase any shares of this Series or Parity Shares (except for a consideration payable in Common Shares or Junior Shares) or redeem fewer than all of the shares of this Series and Parity Shares then outstanding, or (c) permit any corporation or other entity directly or indirectly controlled by the Company to purchase any Common Shares, Junior Shares, shares of this Series or Parity Shares, unless, in the case of any such dividend, payment, distribution, purchase or redemption, all dividends accrued and payable but unpaid on shares of this Series and any Parity Shares have been or contemporaneously are declared and paid in full or declared and a sum sufficient for the payment thereof set aside for such payment. Unless and until all dividends accrued and payable but unpaid on shares of this Series and any Parity Shares at the time outstanding have been paid in full, all dividends declared by the Company upon shares of this Series or Parity Shares shall be declared pro rata with respect to all shares of this Series and Parity Shares then outstanding, so that the amounts of any dividends declared on shares of this Series and such Parity Shares shall in all cases bear to each other the same ratio that, at the time of such declaration, all accrued and payable but unpaid dividends on shares of this Series and such other Parity Shares, respectively, bear to each other. (iii) REDEMPTION AT THE OPTION OF THE COMPANY. (A) This Series shall not be redeemable by the Company prior to November 1, 1995. On and after November 1, 1995, the Company, at its option, may redeem the shares of this Series, in whole or in part, as set forth herein, subject to the provisions described below. (B) This Series may be redeemed, in whole or in part, at the option of the Company, at any time, only if for 20 Trading Days, within any period of 30 consecutive Trading Days, including the last Trading Day of such period, the Closing Price of the Common Shares on each of such 20 Trading Days exceeds 125% of the Conversion Price in effect on such Trading Day. In order to exercise its redemption option, the Company must issue a press release announcing the redemption (the "Press Release") prior to the opening of business on the second Trading Day after the last Trading Day of any such 30 consecutive Trading Day period. The Company may not issue a Press Release prior to November 1, 1995. The Press Release shall announce the redemption and set forth the number of shares of this Series which the Company intends to redeem. The Call Date (as defined below) shall be selected by the Company, shall be specified in the notice of redemption and shall be not less than 30 days nor more than 60 days after the date on which the Company issues the Press Release. (C) Upon redemption of shares of this Series by the Company on the date specified in the notice to holders required under paragraph (E) of this Clause (iii) (the "Call Date"), each share of this Series so redeemed shall be converted into a number of Common Shares equal to the liquidation preference of the shares of this Series being redeemed divided by the Conversion Price as of the opening of business on the Call Date. Upon any redemption of this Series, the Company shall pay any accrued and unpaid dividends in arrears for any Dividend Period ending on or prior to the Call Date. If a Call Date falls after a dividend payment record date and prior to the corresponding Dividend Payment Date, then each holder of this Series at the close of business on such Dividend Payment Record Date shall be entitled to the dividend payable on such shares on the corresponding Dividend Payment Date notwithstanding the redemption of such shares before such Dividend Payment Date. In the case of any Call Date occurring prior to the record date for the December 1, 1995 Dividend Payment Date, the holders of the shares of this Series to be redeemed on such Call Date shall be entitled to any accrued and unpaid dividends through November 1, 1995 but not thereafter. Except as provided above, the Company shall make no payment or allowance for unpaid dividends, whether or not in arrears, on shares of this Series called for redemption or on the Common Shares issued upon such redemption. 2 (D) If full cumulative dividends on this Series and any other class or series of stock of the Company ranking, as to dividends and amounts distributable on liquidation, dissolution or winding up, on a parity with this Series have not been paid or declared and set apart for payment, shares of this Series may not be redeemed in part and the Company may not purchase or acquire shares of this Series, otherwise than pursuant to a purchase or exchange offer made on the same terms to all holders of shares of this Series. (E) If the Company shall redeem shares of this Series pursuant to paragraph (A) of this Clause (iii), notice of such redemption shall be given not more than four Business Days after the date on which the Company issues the Press Release, to each holder of record of the shares to be redeemed. Such notice shall be provided by first class mail, postage prepaid, at such holder's address as the same appears on the stock records of the Company, or by publication in THE WALL STREET JOURNAL or THE NEW YORK TIMES, or if neither such newspaper is then being published, any other daily newspaper of national circulation. If the Company elects to provide such notice by publication, it shall also promptly mail notice of such redemption to the holders of shares of this Series to be redeemed. Neither the failure to mail any notice required by this paragraph (E), nor any defect therein or in the mailing thereof, to any particular holder, shall affect the sufficiency of the notice or the validity of the proceedings for redemption with respect to the other holders. Any notice which was mailed in the manner herein provided shall be conclusively presumed to have been duly given on the date mailed whether or not the holder receives the notice. Each such mailed or published notice shall state, as appropriate: (1) the Call Date and record date for purposes of such redemption; (2) the number of shares of this Series (expressed in 1/10 of a share of this Series) to be redeemed and, if fewer than all the shares held by such holder are to be redeemed, the number of such shares (expressed in 1/10 of a share of this Series) to be redeemed from such holder; (3) the number of Common Shares to be issued with respect to each 1/10 of a share of this Series; (4) the place or places at which certificates for such shares are to be surrendered for certificates representing Common Shares; (5) the then current Conversion Price; and (6) that dividends on the shares to be redeemed shall cease to accrue on such Call Date, except as otherwise provided herein. Notice having been published or mailed as aforesaid, from and after the Call Date (unless the Company shall fail to make available a number of Common Shares or amount of cash necessary to effect such redemption), (i) except as otherwise provided herein, dividends on the shares of this Series so called for redemption shall cease to accrue, (ii) said shares shall no longer be deemed to be outstanding, and (iii) all rights of the holders thereof as holders of shares of this Series shall cease (except the rights to receive the Common Shares and cash payable upon such redemption, without interest thereon, upon surrender and endorsement of their certificates if so required and to receive any dividends payable thereon). The Company's obligation to provide Common Shares and cash in accordance with the preceding sentence shall be deemed fulfilled if, on or before the Call Date, the Company shall deposit with a bank or trust company (which may be an affiliate of the Company) that has an office in the Borough of Manhattan, City of New York, and that has, or is an affiliate of a bank or trust company that has, a capital and surplus of at least $50,000,000, Common Shares and any cash necessary for such redemption, in trust, with irrevocable instructions that such Common Shares and cash be applied to the redemption of the shares of this Series so called for redemption. At the close of business on the Call Date, each holder of shares of this Series to be redeemed (unless the Company defaults in the delivery of the Common Shares or cash payable on such Call Date) shall be deemed to be the record holder of the number of Common Shares into which such shares of this Series is to be redeemed, regardless of whether such holder has surrendered the certificates representing the shares of this Series. No interest shall accrue for the benefit of the holders of shares of this Series to be redeemed on any cash so set aside by the Company. Subject to applicable escheat laws, any such cash unclaimed at the end of six years from the Call Date shall revert to the general funds of the Company, after which reversion the holders of such shares so called for redemption shall look only to the general funds of the Company for the payment of such cash. As promptly as practicable after the surrender in accordance with said notice of the certificates for any such shares so redeemed (properly endorsed or assigned for transfer, if the Company shall so require and the notice shall so state), such shares shall be exchanged for certificates of Common Shares and any cash (without interest thereon) for which such shares have been redeemed. If fewer than all the outstanding shares of this Series are to be redeemed, shares to be redeemed shall be selected by the 3 Company from outstanding shares of this Series not previously called for redemption by lot or pro rata (as nearly as may be) or by any other method determined by the Company in its sole discretion to be equitable, provided that only whole shares shall be called for redemption. If fewer than all the shares represented by any certificate are redeemed, a new certificate shall be issued representing the unredeemed shares without cost to the holder thereof. (F) No fractional shares or scrip representing fractions of Common Shares shall be issued upon redemption of shares of this Series. Instead of any fractional interest in a Common Share that would otherwise be deliverable upon the redemption of a share of this Series, the Company shall pay to the holder of such share an amount in cash (computed to the nearest cent) based upon the Closing Price of Common Shares on the Trading Day immediately preceding the Call Date. If more than one share shall be surrendered for redemption at one time by the same holder, the number of full Common Shares issuable upon redemption thereof shall be computed on the basis of the aggregate number of shares of this Series so surrendered. (G) The Company covenants that any Common Shares issued upon redemption of this Series shall be validly issued, fully paid and non-assessable. The Company shall use its best efforts to list the Common Shares required to be delivered upon redemption of shares of this Series, prior to such redemption, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery. The Company shall endeavor to take any action necessary to ensure that any Common Shares issued upon the redemption of shares of this Series are freely transferable and not subject to any resale restrictions under the Securities Act of 1933, as amended (the "Act"), or any applicable state securities or blue sky laws (other than any Common Shares issued upon redemption of any shares of this Series which are held by an "affiliate" (as defined in Rule 144 under the Act) of the Company). (iv) LIQUIDATION. (A) The liquidation price of shares of this Series, in case of the voluntary or involuntary liquidation, dissolution or winding-up of the Company, shall be $500.00 per share, plus an amount equal to the dividends accrued and unpaid thereon to the payment date (whether or not declared). (B) In the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company, the holders of shares of this Series (1) shall not be entitled to receive the liquidation price of such shares held by them until the liquidation price of all Senior Shares shall have been paid in full and (2) shall be entitled to receive the liquidation price of such shares held by them in preference to and in priority over any distributions upon the Common Shares and all Junior Shares. Upon payment in full of the liquidation price to which the holders of shares of this Series are entitled, the holders of shares of this Series will not be entitled to any further participation in any distribution of assets by the Company. If the assets of the Company are not sufficient to pay in full the liquidation price payable to the holders of shares of this Series and the liquidation price payable to the holders of all Parity Shares, the holders of all such shares shall share ratably in such distribution of assets in accordance with the amounts which would be payable on such distribution if the amounts to which the holders of shares of this Series and the holders of Parity Shares are entitled were paid in full. (C) Neither a consolidation or merger of the Company with or into any other corporation, nor a merger of any other corporation with or into the Company, nor a sale or transfer of all or any part of the Company's assets for cash or securities shall be considered a liquidation, dissolution or winding-up of the Company within the meaning of this Clause (iv). (v) CONVERSION. (A) Subject to the provisions for adjustment hereinafter set forth, each share of this Series shall be convertible at the option of the holder thereof, in the manner hereinafter set forth, into fully paid and nonassessable Common Shares at the Conversion Price, determined as hereinafter provided, in effect on the date of conversion. 4 Any holder of shares of this Series desiring to convert the same into Common Shares shall surrender the certificate or certificates for the shares of this Series being converted, duly endorsed or assigned to the Company or in blank, at the principal office of the Company or at a bank or trust company appointed by the Company for that purpose, accompanied by a written notice of conversion specifying the number (in whole shares) of shares of this Series to be converted and the name or names in which such holder wishes the certificate or certificates for Common Shares to be issued; in case such notice shall specify a name or names other than that of such holder, such notice shall be accompanied by payment of all transfer taxes payable upon the issue of Common Shares in such name or names. In case less than all of the shares of this Series represented by a certificate are to be converted by a holder, upon such conversion the Company shall issue and deliver, or cause to be issued and delivered, to the holder a certificate or certificates for the shares of this Series not so converted. The right to convert shares of this Series called for redemption shall terminate at the close of business on the Call Date pursuant to Clause (iii) above. The holders of shares of this Series at the close of business on a dividend payment record date shall be entitled to receive the dividend payable on such shares on the corresponding dividend payment date notwithstanding the conversion thereof or the Company's default on payment of the dividend due on such dividend payment date. However, shares of this Series surrendered for conversion during the period from the close of business on any record date for the payment of dividends on such shares of this Series to the opening of business on the corresponding dividend payment date (except shares called for redemption on a Call Date during such period) must be accompanied by payment of an amount equal to the dividend payable on such shares on such dividend payment date. A holder of shares of this Series on a dividend payment record date who (or whose transferee) tenders shares of this Series on a dividend payment date will receive the dividend payable on such shares by the Company on such date, and the converting holder need not include payment in the amount of such dividend upon surrender of shares of this Series for conversion. Except as provided above, no payment or adjustment will be made on account of accrued or unpaid dividends upon the conversion of shares of this Series. (B) The Conversion Price shall be adjusted from time to time as follows: (1) In case the Company shall pay or make a dividend or other distribution on any class of capital stock of the Company in Common Shares, the Conversion Price in effect at the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such dividend or other distribution shall be reduced by multiplying such Conversion Price by a fraction of which the numerator shall be the number of Common Shares outstanding at the close of business on the date fixed for such determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such reduction to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this subclause (B)(1), the number of Common Shares at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of the scrip certificates issued in lieu of fractions of Common Shares. The Company will not pay any dividend or make any distribution on Common Shares held in the treasury of the Company. (2) In case the Company shall issue rights or warrants to all holders of its Common Shares entitling them to subscribe for or purchase Common Shares at a price per share less than the current market price per share (determined as provided in subclause (C) hereof) of a Common Share on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Price in effect at the opening of business on the day following the date fixed for such determination shall be reduced by multiplying such Conversion Price by a fraction of which the numerator shall be the number of Common Shares outstanding at the close of business on the date fixed for such determination plus the number of Common Shares which the aggregate of the offering price of the total number of Common Shares offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of Common Shares outstanding at the close of business on the date fixed for such determination plus the 5 number of Common Shares so offered for subscription or purchase, such reduction to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this subclause (B)(2), the number of Common Shares at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not issue any rights or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case outstanding Common Shares shall be subdivided into a greater number of Common Shares, the Conversion Price in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately reduced, and, conversely, in case outstanding Common Shares shall each be combined into a smaller number of Common Shares, the Conversion Price in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately increased, such reduction or increase, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case the Company shall, by dividend or otherwise, distribute to all holders of its Common Shares evidences of its indebtedness or assets (including securities, but excluding rights or warrants referred to in subclause (B)(2), any dividend or distribution paid in cash out of the retained earnings of the Company and any dividend or a distribution referred to in subclause (B)(1)), the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in subclause (C) hereof) of the Common Shares on the date fixed for such determination less the then fair market value (as determined by the Board of Directors, whose determination shall be conclusive) of the portion of the assets or evidences of indebtedness so distributed applicable to one Common Share and the denominator shall be such current market price per share of the Common Shares, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) The reclassification of Common Shares into securities other than Common Shares (other than any reclassification upon a consolidation or merger to which subclause (v)(F) applies) shall be deemed to involve (a) a distribution of such securities other than Common Shares to all holders of Common Shares (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of subclause (B)(4), and (b) a subdivision or combination, as the case may be, of the number of Common Shares outstanding immediately prior to such reclassification into the number of Common Shares outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of subclause (B)(3)). (C) For the purpose of any computation under subclause (B) above and only for such purpose, the current market price per Common Share on any date shall be deemed to be the average of the daily Closing Prices for 15 consecutive Business Days selected by the Company commencing not more than 30 and not less than 20 Business Days before the date in question. (D) Notwithstanding the provisions of subclause (B) above, no adjustment in the Conversion Price shall be required unless such adjustment (plus any adjustments not previously made by reason of this subclause (D)) would require an increase or decrease of at least 1% in such price; provided, however, that any adjustments which by reason of this subclause (D) are not required to be made shall be carried forward and taken into account in any subsequent adjustment; and provided further, that adjustment 6 shall be required and shall be made in accordance with the provisions of this Clause (v) (other than this subclause (D)) not later than the same time as may be required in order to preserve the tax-free nature of a distribution to the holder of any share of this Series. All calculations under this Clause (v) shall be made to the nearest cent. (E) The Company may make such reductions in the Conversion Price, in addition to those required by this Clause (v), as it considers to be advisable in order to avoid or diminish any income tax to any holder of Common Shares resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reasons. The Company shall have the power to resolve any ambiguity or correct any error in this Clause (v) and its actions in so doing shall be final and conclusive. (F) In case the Company shall effect any capital reorganization or reclassification of its shares or shall consolidate or merge with or into any other corporation (other than a consolidation or merger in which the Company is the surviving corporation and each Common Share outstanding immediately prior to such consolidation or merger is to remain outstanding immediately after such consolidation or merger) or shall sell, lease or transfer all or substantially all of its assets to any other person or entity for a consideration consisting in whole or in part of equity securities of such other entity, lawful provision shall be made as a part of the terms of such transaction whereby the holders of shares of this Series shall, if entitled to convert such shares at any time after the consummation of such transaction, receive upon conversion thereof in lieu of each Common Share issuable upon conversion of such shares prior to such consummation the same kind and amount of stock (or other securities, cash or property, if any) as may be issuable or distributable in connection with such transaction with respect to each outstanding Common Share subject to adjustments for subsequent stock dividends and distributions, subdivisions or combinations of shares, capital reorganizations, reclassifications, consolidations or mergers as nearly equivalent as possible to the adjustments provided for in this Clause (v). (G) Whenever the Conversion Price is adjusted as herein provided: (1) the Company shall compute the adjusted Conversion Price and shall cause to be prepared a certificate signed by a principal financial officer of the Company setting forth the adjusted Conversion Price and showing in reasonable detail the facts upon which such adjustment is based and the computation thereof; such certificate shall forthwith be filed with each transfer agent for the shares of this Series; and (2) a notice stating that the Conversion Price has been adjusted and setting forth the adjusted Conversion Price shall, as soon as practicable, be mailed to the holders of record of outstanding shares of this Series. (H) In case: (1) the Company shall declare a dividend or other distribution on its Common Shares otherwise than in cash out of its retained earnings; (2) the Company shall authorize the granting to the holders of its Common Shares of rights or warrants entitling them to subscribe for or purchase any shares of capital stock of any class or of any other rights; (3) of any reclassification of the Common Shares (other than a subdivision or combination of its outstanding Common Shares), or of any consolidation or merger to which the Company is a party and for which approval of any stockholders of the Company is required, or of the sale, lease or transfer of all or substantially all the assets of the Company; or (4) of the voluntary or involuntary liquidation, dissolution or winding-up of the Company; then the Company shall cause to be mailed to each transfer agent of the shares of this Series and to the holders of record of the outstanding shares of this Series, at least 20 days (or 10 days in any case specified in subclauses (1) or (2) above) prior to the applicable record or effective date hereinafter 7 specified, a notice stating (x) the date as of which the holders of record of Common Shares to be entitled to such dividend, distribution, rights or warrants are to be determined, or (y) the date on which such reclassification, consolidation, merger, sale, lease, transfer, liquidation, dissolution or winding-up is expected to become effective, and the date as of which it is expected that holders of record of Common Shares shall be entitled to exchange their shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, sale, lease, transfer, liquidation, dissolution or winding-up. Such notice shall also state whether such transaction will result in any adjustment in the Conversion Price applicable to the shares of this Series and, if so, shall state what the adjusted Conversion Price will be and when it will become effective. Neither the failure to give the notice required by this subclause (H), nor any defect therein, to any particular holder shall affect the sufficiency of the notice or the legality or validity of any such dividend, distribution, right, warrant, reclassification, consolidation, merger, sale, lease, transfer, liquidation, dissolution or winding-up, or the vote on any action authorizing such with respect to the other holders. (I) The Company shall at all times reserve and keep available out of its authorized but unissued Common Shares, for the purpose of issuance upon conversion of shares of this Series, the full number of Common Shares then deliverable upon the conversion of all shares of this Series then outstanding and shall take all action necessary so that Common Shares so issued will be validly issued, fully paid and nonassessable. The Company shall use its best efforts to list the Common Shares required to be delivered upon conversion of shares of this Series, prior to such conversion, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery. (J) The Company will pay any and all stamp or similar taxes that may be payable in respect of the issuance or delivery of Common Shares on conversion of shares of this Series. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of Common Shares in a name other than that in which the shares of this Series so converted were registered, and no such issuance or delivery shall be made unless and until the person requesting such issuance has paid to the Company the amount of any such tax or has established to the satisfaction of the Company that such tax has been paid. (K) No fractional shares or scrip representing fractional shares shall be issued upon the conversion of shares of this Series. If any such conversion would otherwise require the issuance of a fractional share, an amount equal to such fraction multiplied by the Closing Price per Common Share) on the day of conversion shall be paid to the holder in cash by the Company. (L) The certificate of any independent firm of public accounts of recognized standing selected by the Board of Directors shall be presumptive evidence of the correctness of any computation made under this Clause (v). (vi) OTHER PREFERENCE SHARES. So long as any shares of this Series remain outstanding, the Company shall not issue any Preference Shares which are not Senior Shares, Parity Shares or Junior Shares. All shares of this Series which are at any time redeemed pursuant to Clause (iii) above or converted pursuant to Clause (v) above by the Company and subsequently cancelled by the Board of Directors shall have the status of authorized but unissued Preferred Shares, without designation as to series, subject to reissuance by the Board of Directors as shares of this Series or shares of any one or more other series. 8 (vii) VOTING RIGHTS. Except as otherwise required by law, holders of shares of this Series shall have no voting rights; provided, however, that: (A) DIVIDEND DEFAULTS. (1) If and whenever accrued dividends on the shares of this Series or any Parity Shares, whether or not declared, shall not have been paid in an aggregate amount equal to or greater than six quarterly dividends on the shares of this Series or such Parity Shares at the time outstanding, then, and in any such event, the number of Directors then constituting the entire Board of Directors of the Company shall automatically be increased by two Directors and the holders of shares of this Series and the holders of such Parity Shares, voting together as a single class, shall be entitled to fill such newly created directorships. Such right to vote as a single class to elect two Directors shall, when vested, continue until all dividends in default on the shares of this Series and such Parity Shares, as the case may be, shall have been paid in full and, when so paid, such right to elect two Directors separately as a class shall cease, subject, always, to the same provisions for the vesting of such right to elect two Directors separately as a class in the case of future dividend defaults. At any time when such right to elect two Directors separately as a class shall have so vested the Company may, and upon the written request of the holders of record of not less than 20% of the total number of shares of this Series and such Parity Shares then outstanding shall, call a special meeting of the holders of such shares to fill such newly created directorships for the election of Directors. In the case of such a written request, such special meeting shall be held within 90 days after the delivery of such request and, in either case, at the place and upon the notice provided by law and in the Bylaws of the Company, provided that the Company shall not be required to call such a special meeting if such request is received less than 120 days before the date fixed for the next ensuing annual meeting of stockholders of the Company, at which meeting such newly created directorships shall be filled by the holders of such shares of this Series and such Parity Shares. (2) So long as any shares of this Series are outstanding, the Bylaws of the Company shall contain provisions ensuring that the number of Directors of the Company shall at all times be such that the exercise, by the holders of shares of this Series and the holders of Parity Shares, of the right to elect Directors under the circumstances provided in paragraph (1) of this subclause (A) will not contravene any provisions of the Company's Restated Certificate of Incorporation or Bylaws. (3) Directors elected pursuant to paragraph (1) of this subclause (A) shall serve until the earlier of (x) the next annual meeting of the stockholders of the Company and the election (by the holders of shares of this Series and the holders of Parity Shares) and qualification of their respective successors or (y) the next annual meeting of the stockholders of the Company following the date upon which all dividends in default on the shares of this Series and such Parity Shares shall have been paid in full. If, prior to the end of the term of any Director elected as aforesaid, a vacancy in the office of such Director shall occur during the continuance of a default in dividends on the shares of this Series or such Parity Shares by reason of death, resignation or disability, such vacancy shall be filled for the unexpired term by the appointment by the remaining Director elected as aforesaid of a new Director for the unexpired term of such former Director. (B) MISCELLANEOUS. Without the affirmative vote of the holders of at least two-thirds of the outstanding shares of this Series and outstanding Parity Shares, voting as a single class (or, if less than all shares of this Series and all series of Parity Shares then outstanding would be similarly adversely affected thereby, without the affirmative vote of the holders of at least two-thirds of the outstanding shares of each series so affected, voting as a separate class), the Company may not (1) amend the Company's Restated Certificate of Incorporation or this Certificate so as to adversely affect the voting powers (except as such voting powers may be affected by the authorization of any new series of Parity Shares having the same voting rights as this Series or by the authorization of any other shares of any class having voting rights which are not entitled to vote together with this Series in any separate class vote) or other rights or preferences of shares of this Series; or 9 (2) authorize or create any Senior Shares. (C) VOTES PER SHARE. For purposes of the foregoing provisions of this Clause (vii), each share of this Series shall have one vote per share. (viii) CERTAIN DEFINITIONS. As used in this Certificate, the following terms shall have the following respective meanings: "BUSINESS DAY" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in The City of New York are authorized or obligated by law or executive order to close. "CLOSING PRICE" on any day shall mean (i) the last reported sales price regular way per Common Share on such day or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked prices regular way, in either case on the New York Stock Exchange ("NYSE"), or (ii) if the Common Shares are not listed or admitted to trading on the NYSE, the last reported sales price regular way, or in case no such reported sale takes place on such day, the average of the reported closing bid and asked prices regular way, on the principal national securities exchange on which the Common Shares are admitted for trading, or (iii) if the Common Shares are not listed or admitted for trading on any national securities exchange, the average of the closing bid and asked prices as furnished by any NYSE member firm selected from time to time by the Company for that purpose. "COMMON SHARES" shall mean any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company and which is not subject to redemption by the Company. However, Common Shares issuable upon conversion of shares of this Series shall include only shares of the class designated as Common Shares as of the original date of issuance of shares of this Series, or shares of the Company of any class or classes resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company and which are not subject to redemption by the Company; PROVIDED that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from such reclassifications bears to the total number of shares of all classes resulting from all such reclassifications. "CONVERSION PRICE" shall mean the Conversion Price per share of Common Stock for which this Series is convertible, as such Conversion Price may be adjusted pursuant to Clause (v). The initial Conversion Price will be $14.175 (equivalent to a conversion rate of 35.273 shares of Common Stock for each share of this Series). "DIVIDEND PAYMENT DATE" shall mean the first calendar day of March, June, September and December in each year, commencing on December 1, 1992; PROVIDED, HOWEVER, that if any Dividend Payment Date falls on any day other than a Business Day, the dividend payment due on such Dividend Payment Date shall be paid on the Business Day immediately following such Dividend Payment Date. "DIVIDEND PERIODS" shall mean quarterly dividend periods commencing on March 1, June 1, September 1 and December 1 of each year and ending on and including the day preceding the first day of the next succeeding Dividend Period (other than the initial Dividend Period, which shall commence on the Issue Date and end on and include November 30, 1992.) "ISSUE DATE" shall mean the first date on which shares of this Series are issued and sold. "JUNIOR SHARES" shall mean the Company's Series A Junior Participating Preferred Stock and any Preference Shares of any series or class of the Company which are by their terms expressly made junior to shares of this Series at the time outstanding both as to dividends and as to the distribution of assets on any voluntary or involuntary liquidation of the Company. 10 "PARITY SHARES" shall mean the Company's $40.00 Convertible Exchangeable Preferred Stock and any Preference Shares which are by their terms on a parity with the shares of this Series at the time outstanding both as to dividends and as to the distribution of assets on any voluntary or involuntary liquidation of the Company. "PREFERENCE SHARES" shall mean any class of shares of the Company ranking prior to at least one other class of shares of the Company as to the payment of dividends or the distributions of assets on any voluntary or involuntary liquidation of the Company. "SENIOR SHARES" shall mean any Preference Shares of any series or class of the Company which are by their terms expressly made senior to shares of this Series at the time outstanding both as to dividends and as to the distribution of assets on any voluntary or involuntary liquidation of the Company. "TRADING DAY" shall mean any day on which the securities in question are traded on the NYSE, or if such securities are not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such securities are listed or admitted, or if not listed or admitted for trading on any national securities exchange, on the National Market System of the NASDAQ, or if such securities are not quoted on such National Market System, in the applicable securities market in which the securities are traded. IN WITNESS WHEREOF, the Company has caused this Certificate to be duly executed on its behalf by the undersigned Vice President and attested to by its Secretary this 5th day of October, 1992. NATIONAL SEMICONDUCTOR CORPORATION -------------------------------------- /s/ Donald Macleod , ----------------------------------------------------------------------------- Vice President [ - --------Seal] /s/ John M. Clark III - -------------------------------------- JOHN M. CLARK III , - ----------------------------------------------------------------------------- Secretary 11 EX-4.D 5 EXHIBIT 4D BY-LAWS OF NATIONAL SEMICONDUCTOR CORPORATION ---------------------------------- ARTICLE I. --------- OFFICES ------- Section 1. REGISTERED OFFICE. The registered office shall be in the City of Wilmington, County of New Castle, State of Delaware. Section 2. OTHER OFFICES. The corporation may also have offices at such other places both within and without the State of Delaware as the board of directors may from time to time determine or the business of the corporation may require. ARTICLE II. ---------- STOCKHOLDERS ------------ Section 1. PLACE OF MEETINGS. Meetings of stockholders shall be held at such place either within or without the State of Delaware as may be designated by the board of directors. Section 2. ANNUAL MEETING. An annual meeting of stockholders shall be held on the fourth Friday in September of each year, at 10:30 A.M., or at such other date and time as shall be designated by the board of directors. At the annual meeting the stockholders shall elect a board of directors and transact such other business as may be properly brought before the meeting. Section 3. SPECIAL MEETINGS. Special meetings of the stockholders (a) may be called by the chairman of the board of directors, the president, or by a majority of the board of directors but (b) shall be called by the secretary at the request in writing of stockholders owning at least 50% in interest of the capital stock of the corporation issued and outstanding and entitled to vote at such meeting. Any business can be transacted at a special meeting of the stockholders. Section 4. NOTICE OF MEETINGS. The secretary or such other officer of the corporation as is designated by the board of directors shall serve personally or send through the mails or by telegraph a written notice of annual or special meetings of stockholders, addressed to each stockholder of record entitled to vote at his address as it appears on the stock transfer books of the corporation, stating the time and place of the meeting, not less than ten nor more than sixty days before the date of the meeting, except that a special meeting may be called on five days' notice. If mailed, notice shall be deemed to have been given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Notice given by telegraph shall be deemed to have been given upon delivery of the message to the telegraph company. Section 5. WAIVER OF NOTICE. Notice of a meeting need not be given to any stockholder who signs a waiver of notice, in person or by proxy, whether before or after a meeting. The attendance of any 2 stockholder at a meeting, in person or by proxy, without protesting either prior thereto or at its commencement the lack of notice of such meeting, shall constitute a waiver of notice by him. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice. Section 6. ACTION BY CONSENT. Any action required to be taken at any annual or special meeting of stockholders, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. Section 7. STOCKHOLDER'S LIST. The officer who has charge of the stock transfer book of the corporation shall prepare and make, at least ten days before every meeting of the stockholders at which directors are to be elected, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of 3 shares registered in the name of each stockholder. Such list shall be open to examination by any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. Section 8. QUORUM. The holders of a majority of the stock issued and outstanding and entitled to vote at a meeting, present in person or represented by proxy, shall constitute a quorum at all meetings of stockholders for the transaction of business except as otherwise provided by statute. If, however, such quorum shall not be present or represented at any meeting of the stockholders, a majority in interest of the stockholders entitled to vote thereat, present in person or represented by proxy, shall have the power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty days, or after the adjournment 4 a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote. Section 9. PROXIES. At all meetings of stockholders, each stockholder entitled to vote shall have one vote, to be exercised in person or by proxy, for each share of capital stock having voting power, held by such stockholder. All proxies shall be in writing, shall relate only to a specific meeting (including continuations and adjournments of the same), and shall be filed with the secretary at or before the time of the meeting. Each proxy must be signed by the shareholder or his attorney-in-fact. The person or persons named in a proxy for a specific meeting may vote at any adjournment of the meeting for which the proxy was given. If more than one person is named as proxy, a majority of such persons so named present at the meeting, or if only one shall be present, then that one, shall have and exercise all the powers conferred upon all of the persons unless the proxy shall provide otherwise. A proxy purporting to be executed by or on behalf of a stockholder shall be deemed valid unless challenged prior to or at its exercise and the burden of proving invalidity shall rest on the challenger. Section 10. VOTING. When a quorum is present at any meeting, the vote of the holders of a majority of the capital stock having voting power present in person or represented by proxy shall decide 5 any question brought before such meeting, except in respect of elections of directors which shall be decided by a plurality of the votes cast, and except when the question is one which by express provision of statute a different vote is required, in which case such express provision shall govern and control the decision of such question. No vote need be taken by ballot unless required by statute. ARTICLE III. ----------- THE BOARD OF DIRECTORS ---------------------- Section 1. COMPOSITION. The board of directors shall consist of eight directors subject to such automatic increase as may be required by the corporation's Restated Articles of Incorporation. The board may enlarge or reduce the size of the board in a vote of the majority of the directors in office. No director need be a stockholder. Section 2. ELECTION AND TERM. Except as provided in Section 3 of this Article, the directors shall be elected by a plurality vote at the annual meeting of the stockholders. Each director shall hold office until his successor is elected and qualified or until his earlier resignation or removal. Section 3. VACANCIES AND NEWLY CREATED DIRECTORSHIPS. Any vacancy on the board of directors, or any newly created directorships, however occurring, may be filled by a majority of the directors then in office, though less than a quorum or by a 6 sole remaining director. Any vacancy in the board of directors may also be filled by a plurality vote of the stockholders unless such vacancy shall have been previously filled by the board of directors. Section 4. POWERS. The business of the corporation shall be managed by its board of directors which shall have and may exercise all such powers of the corporation, including the power to make, alter or repeal the bylaws of the corporation, and do all such lawful acts and things as are not by statute directed or required to be exercised or done by the stockholders. Section 5. PLACE OF MEETINGS. The board of directors of the corporation may hold meetings both regular and special, either within or without the State of Delaware. Members of the board of directors or any committee designated by the board, may participate in a meeting of such board or committee by means of a conference telephone by means of which all persons participating in the meeting can hear each other, and participation shall constitute presence in person at such meeting. Section 6. REGULAR MEETINGS. Regular meetings of the board of directors may be held without call or notice immediately following the annual meeting of the stockholders and at such time and at such place as shall from time to time be selected by the board of directors, provided that in respect of any director who is absent when such selection is made, the notice, waiver and attendance provisions of Section 7 of this Article shall apply to such regular meetings. 7 Section 7. SPECIAL MEETINGS AND NOTICE. Special meetings of the board of directors may be called by the chairman of the board of directors, a majority of the directors or the president on at least two days' notice given to each director, either personally or by mail or telegram sent to his business or home address, stating the place, date and hour of the meeting. If mailed, notice shall be deemed to have been given when deposited in the United States mail, postage prepaid, directed to the director at his business or home address. Notice given by telegraph shall be deemed to have been given upon delivery of the message to the telegraph company. Notice of a meeting need not be given to any director who signs a waiver of notice, whether before or after the meeting. The attendance of any director at a meeting, without protesting either prior thereto or at its commencement the lack of notice of such meeting, shall constitute a waiver of notice by him. Any notice or waiver of notice of a meeting of the board of directors need not specify the purposes of the meeting. Section 8. QUORUM AND VOTING. At all meetings of the board of directors a majority less one of the total number of directors then in office shall constitute a quorum for the transaction of business, except that in no case shall less than two directors be deemed to constitute a quorum, and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the board of directors. If a quorum shall not be present at any meeting of the board of directors, a majority of less than a quorum may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present. 8 Section 9. ACTION BY CONSENT. Any action required or permitted to be taken at any meeting of the board of directors may be taken without a meeting, if all members of the board of directors, then in office, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the board of directors. Section 10. RESIGNATION. Any director may resign at any time upon written notice delivered to the corporation at its principal office. The resignation shall take effect at the time specified therein, and if no time be specified, at the time of its dispatch to the corporation. Section 11. REMOVAL. A director may be removed for cause by the vote of a majority of the stockholders at a special or annual meeting after the director has been given reasonable notice and opportunity to be heard before the stockholders. Section 12. COMMITTEES. The board of directors may, by resolution passed by a majority of the whole board of directors, designate one or more committees, each committee to consist of one or more of the directors of the corporation, which committee, to the extent provided in the resolution, shall have and may exercise the powers of the board of directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the board of directors. Each committee shall keep regular minutes of its meetings and report the same to the board of directors when required. 9 ARTICLE IV. ---------- OFFICERS -------- Section 1. DESIGNATION. The officers of the corporation shall consist of a president, a treasurer, a secretary, and such other officers including a chairman of the board of directors, one or more group presidents, vice presidents (including group executive vice presidents, corporate vice presidents and senior vice presidents), assistant treasurers and assistant secretaries, as the board of directors or the stockholders may deem warranted. With the exception of the chairman of the board of directors who must be a director, no officer need be a director or a stockholder. Any number of offices may be held by the same person. Section 2. ELECTION AND TERM. Except for officers to fill vacancies and newly created offices provided for in Section 6 of this Article, the officers shall be elected by the board of directors at the first meeting of the board of directors after the annual meeting of the stockholders. All officers shall hold office at the pleasure of the board of directors. Section 3. DUTIES OF OFFICERS. In addition to those duties that may from time to time be delegated to them by the board of directors, the officers of the corporation shall have the following duties: (a) CHAIRMAN OF THE BOARD. The chairman of the board shall preside at all meetings of the stockholders and of the board of directors at which he is present, shall be ex-officio a member of all committees formed by the board of directors and shall have such other duties and powers as the board of directors may prescribe. 10 (b) PRESIDENT. The president shall be the chief executive officer of the corporation, shall have general and active management of the business of the corporation, shall see that all orders and resolutions of the board of directors are carried into effect, and, in the absence or nonelection of the chairman of the board of directors, shall preside at all meetings of the stockholders and the board of directors at which he is present if he is also a director. The president also shall execute bonds, mortgages, and other contracts requiring a seal under the seal of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be delegated expressly by the board of directors to some other officer or agent of the corporation and shall have such other powers and duties as the board of directors may prescribe. (c) GROUP PRESIDENT. The group president or group presidents, if any, shall have general and active management of the group for which they are designated as president by the board of directors and shall have such other duties and powers as vice-presidents or as the board of directors or the president may prescribe. (d) VICE-PRESIDENT. The vice-president or vice-presidents, if any, shall have such duties and powers as the board of directors or the president may prescribe. In the absence of the president or in the event of his inability or refusal to act, the group president or vice-president, if any, or if there be more than one, the group presidents or vice-presidents, in the order designated by the board of directors, or, in the absence of such designation, then in the order of their election, shall perform the duties and exercise the powers of the president. (e) SECRETARIES AND ASSISTANT SECRETARIES. The secretary shall record the proceedings of all meetings of the stockholders and all meetings of the board of directors in books to be kept for that purpose, shall perform like duties for the standing committees when required, and shall give, or cause to be given, call and/or notices of all meetings of the stockholders and meetings of the board of directors in accordance with these by-laws. The secretary also shall have custody of the corporate seal of the corporation, affix the seal to any instrument requiring it and attest thereto when authorized by the board of directors or the president, and shall have such other duties and powers as the board of directors may prescribe. The assistant secretary, if any, or if there be more than one, the assistant secretaries, in the order designated 11 by the board of directors, or, if there be no such designation, then in order of their election, shall, in the absence of the secretary or in the event of his inability or refusal to act, perform the duties and exercise the powers of the secretary and shall have such other duties and powers as the board of directors may prescribe. In the absence of the secretary or an assistant secretary at a meeting of the stockholders or the board of directors, an acting secretary shall be chosen by the stockholders or directors, as the case may be, to exercise the duties of the secretary at such meeting. In the absence of the secretary or an assistant secretary or in the event of the inability or refusal of the secretary or an assistant secretary to give, or cause to be given, any call and/or notice required by law or these by- laws, any such call and/or notice may be given by any person so directed by the board of directors, the president or stockholders, upon whose requisition the meeting is called in accordance with these by-laws. (f) TREASURER AND ASSISTANT TREASURER. The treasurer shall have the custody of the corporate funds and securities, shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the board of directors. The treasurer shall also disburse the funds of the corporation as may be ordered by the board of directors, taking proper vouchers for such disbursements, shall render to the board of directors, when the board of directors so requires, an account of all his transactions as treasurer and of the financial condition of the corporation, and shall have such other duties and powers as the board of directors may prescribe. If required by the board of directors, the treasurer shall give the corporation a bond, which shall be renewed every six years, in such sum and with such surety or sureties as shall be satisfactory to the board of directors for the faithful performance of the duties of his office and for the restoration to the corporation, in case of his death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the corporation. The assistant treasurer, if any, or if there be more than one, the assistant treasurers in the order designated by the board of directors, or, in the absence of such designation, then in the order of their election, shall, in the absence of the 12 treasurer or in the event of his inability or refusal to act, perform the duties and exercise the powers of the treasurer and shall have such other duties and powers as the board of directors may prescribe. (g) OTHER OFFICERS. Any other officer shall have such powers and duties as the board of directors may prescribe. Section 4. RESIGNATION. Any officer may resign at any time upon written notice delivered to the corporation at its principal office. The resignation shall take effect at the time specified therein, and if no time be specified, at the time of its dispatch to the corporation. Section 5. REMOVAL. Any officer elected or appointed by the board of directors may be removed at any time by the affirmative vote of a majority of the board of directors. Section 6. VACANCIES AND NEWLY CREATED OFFICES. A vacancy in office, however occurring, and newly created offices, shall be filled by the board of directors. ARTICLE V. --------- CAPITAL STOCK ------------- Section 1. STOCK CERTIFICATES. Each holder of stock in the corporation shall be entitled to have a certificate signed in an officer's official capacity or in the name of the corporation by the chairman of the board of directors, or the president or a vice-president and the treasurer or an assistant treasurer, or the secretary or an assistant secretary of the corporation, certifying 13 the number of shares owned by him in the corporation. Where a certificate is countersigned (a) by a transfer agent other than the corporation or its employee, or, (b) by a registrar other than the corporation or its employee, any other signature on the certificate may be facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue. Section 2. LOST, STOLEN OR DESTROYED CERTIFICATES. The board of directors, or at their direction any officer of the company, may direct a new certificate or certificates theretofore issued by the corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates, the board of directors, or at their direction any officer of the company, may, in its (his) discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or to give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the 14 corporation with respect to the certificate alleged to have been lost, stolen or destroyed. Section 3. TRANSFER. Upon surrender to the secretary or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, and upon compliance with any provisions respecting restrictions on transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Section 4. ISSUE OF STOCK. From time to time, the board of directors may, by vote of a majority of the directors, issue any of the authorized capital stock of the corporation for cash, property, services rendered or expenses, or as a stock dividend and on any terms permitted by law. Section 5. FIXING RECORD DATE. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the board of directors may fix, in advance, a record date, which shall not be more than sixty nor 15 less than ten days before the date of such meeting, nor more than sixty days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the board of directors may fix a new record date for the adjourned meeting. Section 6. REGISTERED STOCKHOLDERS. The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware. ARTICLE VI. ---------- GENERAL PROVISIONS ------------------ Section 1. DIVIDENDS. Dividends upon the capital stock of the corporation may be declared by the board of directors in any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of capital stock. Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the 16 directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the directors shall think conducive to the interest of the corporation, and the directors may modify or abolish any such reserve in the manner in which it was created. Section 2. CHECKS. All checks or demands for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the board of directors may from time to time designate. Section 3. FISCAL YEAR. The fiscal year of the corporation shall be fixed by a resolution of the board of directors. Section 4. SEAL. The corporate seal shall have inscribed thereon the name of the corporation, the year of its organization and the words "Corporate Seal Delaware". The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. ARTICLE VII. ----------- AMENDMENTS ---------- Section 1. AMENDMENTS. These by-laws may be amended at any proper meeting of the stockholders or of the board of directors. 17 ARTICLE VIII. ------------ INDEMNIFICATION --------------- Section 1. NON-DERIVATIVE PROCEEDINGS. The corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director, officer, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any 18 criminal action or proceedings, had reasonable cause to believe that his conduct was unlawful. Section 2. DERIVATIVE PROCEEDINGS. The corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. 19 Section 3. MOUNT OF INDEMNIFICATION. To the extent that a director, officer, employee or agent of the corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 1 or 2, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith. Section 4. DETERMINATION TO INDEMNIFY. Any indemnification under Sections 1 or 2 (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in Sections 1 and 2. Such determination shall be made (1) by the board of directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in written opinion, or (3) by the stockholders. Section 5. ADVANCE PAYMENT. Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of a director, officer, employee or agent to repay such amount if it shall ultimately be determined that he is not entitled to be 20 indemnified by the corporation as authorized in this section or otherwise pursuant to the law of Delaware. Section 6. NON-EXCLUSIVENESS OF BY-LAW. The indemnification and advancement of expenses provided by, or granted pursuant to, the other subsections of this Article VIII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any statute, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office. Section 7. CONTINUATION OF INDEMNIFICATION. The indemnification and advancement of expenses provided by, or granted pursuant to this Article VIII, or permitted by statute or otherwise, shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. Section 8. INDEMNIFICATION INSURANCE. The corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the 21 corporation would have the power to indemnify him against such liability under the provisions of this section. 22 EX-4.I 6 EXHIBIT 4I NATIONAL SEMICONDUCTOR CORPORATION AND THE FIRST NATIONAL BANK OF BOSTON AS DEPOSITARY AND HOLDERS OF DEPOSITARY RECEIPTS --------------- DEPOSIT AGREEMENT --------------- DATED AS OF OCTOBER 5, 1992 TABLE OF CONTENTS
PAGE --------- ARTICLE I -- DEFINITIONS.................................................................................. 1 ARTICLE II -- FORM OF RECEIPTS, DEPOSIT OF STOCK, EXECUTION AND DELIVERY, TRANSFER, SURRENDER, REDEMPTION AND CONVERSION OF RECEIPTS........................................................................ 2 SECTION 2.01. Form and Transferability of Receipts............................................... 2 SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof........................................................................... 3 SECTION 2.03. Redemption of Stock................................................................ 4 SECTION 2.04. Transfer of Receipts............................................................... 5 SECTION 2.05. Combinations and Split-ups of Receipts............................................. 5 SECTION 2.06. Surrender of Receipts and Withdrawal of Stock...................................... 5 SECTION 2.07. Limitations on Execution and Delivery, Transfer and Surrender of Receipts.......... 6 SECTION 2.08. Lost Receipts, Etc. ............................................................... 6 SECTION 2.09. Cancellation and Destruction of Surrendered Receipts............................... 6 SECTION 2.10. Conversion of Stock into Common Stock.............................................. 6 ARTICLE III -- CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY................................. 7 SECTION 3.01. Filing Proofs, Certificates and Other Information.................................. 7 SECTION 3.02. Payment of Taxes or Other Governmental Charges..................................... 8 SECTION 3.03. Warranties as to Stock............................................................. 8 SECTION 3.04. Covenants and Warranties as to Common Stock........................................ 8 ARTICLE IV -- THE DEPOSITED SECURITIES; NOTICES........................................................... 8 SECTION 4.01. Cash Distributions................................................................. 8 SECTION 4.02. Distributions Other Than Cash...................................................... 9 SECTION 4.03. Subscription Rights, Preferences or Privileges..................................... 9 SECTION 4.04. Notice of Dividends, Fixing of Record Date for Holders of Receipts................. 10 SECTION 4.05. Voting Rights...................................................................... 10 SECTION 4.06. Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, Etc. ............................................................................. 10 SECTION 4.07. Reports............................................................................ 11 SECTION 4.08. Lists of Receipt Holders; Access to Certain Information............................ 11 ARTICLE V -- THE DEPOSITARY AND THE COMPANY............................................................... 11 SECTION 5.01. Maintenance of Offices, Agencies, Transfer Books by the Depositary; Registrar...... 11 SECTION 5.02. Prevention or Delay in Performance by the Depositary, the Depositary's Agents or the Company....................................................................... 11 SECTION 5.03. Obligations of the Depositary, the Depositary's Agents and the Company............. 12 SECTION 5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary..... 12 SECTION 5.05. Corporate Notices and Reports...................................................... 13 SECTION 5.06. Deposit of Stock by the Company.................................................... 13 SECTION 5.07. Indemnification by the Company..................................................... 13 SECTION 5.08. Charges and Expenses............................................................... 13 SECTION 5.09. Authorization of Agreement......................................................... 13
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PAGE --------- ARTICLE VI -- AMENDMENT; TERMINATION...................................................................... 13 SECTION 6.01. Amendment.......................................................................... 13 SECTION 6.02. Termination........................................................................ 14 ARTICLE VII -- MISCELLANEOUS.............................................................................. 14 SECTION 7.01. Counterparts....................................................................... 14 SECTION 7.02. Exclusive Benefit of Parties....................................................... 14 SECTION 7.03. Invalidity of Provisions........................................................... 14 SECTION 7.04. Notices............................................................................ 14 SECTION 7.05. Depositary's Agents................................................................ 15 SECTION 7.06. Holders of Receipts are Parties.................................................... 15 SECTION 7.07. Governing Law...................................................................... 15 SECTION 7.08. Headings........................................................................... 15 EXHIBIT A: DEPOSITARY RECEIPT FOR DEPOSITARY CONVERTIBLE PREFERRED SHARES
ii DEPOSIT AGREEMENT DEPOSIT AGREEMENT, dated as of October 5, 1992, among National Semiconductor Corporation, a corporation duly organized and existing under the laws of the State of Delaware with its principal office in Santa Clara, California, The First National Bank of Boston, a national banking association duly organized and acting under the laws of the United States of America with its principal office in Boston, Massachusetts, and all holders from time to time of Depositary Receipts issued hereunder. WITNESSETH: Whereas, it is desired to provide, as hereinafter set forth in this Deposit Agreement, for the deposit of shares of $ Convertible Preferred Shares, par value $.50 per share, liquidation value $500 per share, of National Semiconductor Corporation with The First National Bank of Boston, as Depositary, for the purposes set forth in this Deposit Agreement and for the issuance hereunder of Depositary Receipts evidencing Depositary Convertible Preferred Shares, in respect of the $ Convertible Preferred Shares so deposited; and WHEREAS, the Depositary Receipts are to be substantially in the form of Exhibit A annexed hereto, with appropriate insertions, modifications and omissions, as hereinafter provided in this Deposit Agreement; Now, THEREFORE, in consideration of the premises, it is agreed by and among the parties hereto as follows: ARTICLE I DEFINITIONS The following definitions shall for all purposes, unless otherwise clearly indicated, apply to the respective terms used in this Deposit Agreement and the Receipts: SECTION 1.01. The term "Authorizing Resolution" shall mean the resolution adopted by the Company's Board of Directors establishing and setting forth the rights, preferences and privileges of the Stock. SECTION 1.02. The term "Certificate of Incorporation" shall mean the Restated Certificate of Incorporation, as amended from time to time, of the Company. SECTION 1.03. The term "Common Stock" shall mean any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which is not subject to redemption by the Company. However, subject to the provisions of Clause (v) of the Authorizing Resolution, shares issuable on conversion of the Stock shall include only shares of the class designated as Common Stock of the Company at the date of this Deposit Agreement or shares of any class or classes resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which are not subject to redemption by the Company; provided that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from any such reclassification bears to the total number of shares of all such classes resulting from all such reclassifications. SECTION 1.04. The term "Company" shall mean National Semiconductor Corporation, incorporated under the laws of the State of Delaware and having its principal office at 2900 Semiconductor Drive, P.O. Box 58090, Santa Clara, California 95052-8090, and its successors. SECTION 1.05. The term "Deposit Agreement" shall mean this Agreement, as the same may be amended or supplemented from time to time. 1 SECTION 1.06. The term "Depositary" shall mean The First National Bank of Boston, a national banking association duly organized and existing under the laws of the United States of America, with its principal office at 100 Federal Street, Boston, Massachusetts 02110, and any successor as depositary hereunder. SECTION 1.07. The term "Depositary's Agent" shall mean an agent appointed by the Depositary as provided, and for the purposes specified, in Section 7.05. SECTION 1.08. The term "Depositary Shares" shall mean the Depositary Convertible Preferred Shares, evidenced by the Depositary Receipts issued hereunder and representing the interests in Stock deposited with the Depositary hereunder. Each Depositary Share shall, as provided herein, represent an interest in one-tenth (1/10) of one share of Stock and the same proportionate interest in any and all other property received by the Depositary in respect of such shares of Stock and held at the time under this Deposit Agreement. SECTION 1.09. The term "Receipt" shall mean one or more of the Depositary Receipts issued hereunder. SECTION 1.10. The term "record holder" as applied to a Receipt shall mean the person in whose name a Receipt is registered on the books of the Depositary maintained for such purpose. SECTION 1.11. The term "Registrar" shall mean any bank or trust company which shall be appointed to register Receipts as herein provided. SECTION 1.12. The term "Securities Act of 1933" shall mean the Act of May 27, 1933 (15 U.S. Code, Secs. 77a-77aa), as from time to time amended. SECTION 1.13. The term "Shareholder Services Division" shall mean the Shareholder Services Division of the Depositary, which at the date of this Deposit Agreement is located at 150 Royall Street, Canton, Massachusetts, 02021. SECTION 1.14. The term "Stock" shall mean the Company's $ Convertible Preferred Shares, par value $.50 per share, liquidation value $500 per share, heretofore validly issued, fully paid and nonassessable. ARTICLE II FORM OF RECEIPTS, DEPOSIT OF STOCK, EXECUTION AND DELIVERY, TRANSFER, SURRENDER, REDEMPTION AND CONVERSION OF RECEIPTS SECTION 2.01. FORM AND TRANSFERABILITY OF RECEIPTS. Receipts shall be engraved or printed or lithographed on steel-engraved borders and shall be substantially in the form set forth in Exhibit A annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions, as hereinafter provided. Receipts shall be executed by the Depositary by the manual signature of a duly authorized officer of the Depositary, provided that such signature may be a facsimile if a Registrar for the Receipts (other than the Depositary) shall have been appointed and such Receipts are countersigned by manual signature of a duly authorized signatory of the Registrar. No Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose, unless it shall have been executed manually or, if a Registrar for the Receipts (other than the Depositary) shall have been appointed, by facsimile by the Depositary by the signature of a duly authorized officer and, if executed by facsimile signature of the Depositary, shall have been countersigned manually by such Registrar by the signature of a duly authorized signatory. Receipts executed as provided in this Section may be issued notwithstanding that any authorized officer of the Depositary signing such Receipts shall have ceased to hold office at the time of issuance of such Receipts. The Depositary shall record on its books each Receipt so signed and delivered as hereinafter provided. Except as the Depositary and the Company may otherwise determine, Receipts shall be in denominations of any number of whole Depositary Shares. All receipts shall be dated the date of their execution. 2 Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Deposit Agreement as may be required by the Depositary or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Stock or the Depositary Shares may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject by reason of the date of issuance of the Stock or otherwise. Title to a Receipt which is properly endorsed or accompanied by a properly executed instrument of transfer and to the Depositary Shares evidenced thereby, shall be transferable by delivery with the same effect as in the case of a negotiable instrument; provided however, that until a Receipt shall be transferred on the books of the Depositary as provided in Section 2.04, the Depositary, each Depositary's Agent and the Company may, notwithstanding any notice to the contrary, treat the record holder thereof at such time as the absolute owner thereof for the purpose of determining the person entitled to distribution of dividends or other distributions, the exercise of conversion rights or any notice provided for in this Deposit Agreement and for all other purposes. SECTION 2.02. DEPOSIT OF STOCK; EXECUTION AND DELIVERY OF RECEIPTS IN RESPECT THEREOF. Subject to the terms and conditions of this Deposit Agreement, any holder of Stock may deposit such Stock under this Deposit Agreement by a delivery to the Depositary of a certificate or certificates for the Stock to be deposited, properly endorsed or accompanied, if required by law, by a duly executed instrument of transfer or endorsement, in form satisfactory to the Depositary, together with all such certifications as may be required by the Depositary in accordance with the provisions of this Deposit Agreement, and together with a written order directing the Depositary to execute and deliver to, or upon the written order of, the person or persons stated in such order a Receipt or Receipts for the number of Depositary Shares representing such deposited Stock. If required by the Depositary, Stock presented for deposit at any time, whether or not the register of stockholders of the Company is closed, shall also be accompanied by an agreement or assignment, or other instrument satisfactory to the Depositary, which will provide for the prompt transfer to the Depositary or its nominee of any dividend or right to subscribe for additional Stock or to receive other property which any person in whose name the Stock is or has been recorded may thereafter receive upon or in respect of such deposited Stock, or in lieu thereof such agreement of indemnity or other agreement as shall be satisfactory to the Depositary. Subject to the terms and conditions of this Deposit Agreement, Stock may also be deposited hereunder in connection with the delivery of Receipts to represent distributions under Section 4.02 and upon exercise of the rights to subscribe referred to in Section 4.03. Upon each delivery to the Depositary of a certificate or certificates for Stock to be deposited hereunder, together with the other documents above specified, the Depositary shall, as soon as transfer and recordation can be accomplished, present such certificate or certificates to the Company for transfer and recordation in the name of the Depositary or its nominee of the Stock being deposited. Deposited Stock shall be held by the Depositary at the Depositary's Shareholder Services Division or at such other place or places as the Depositary shall determine. Upon receipt by the Depositary of a certificate or certificates for Stock deposited in accordance with the provisions of this Section, together with the other documents required as above specified and upon recordation of the Stock on the books of the Company in the name of the Depositary or its nominee, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall execute and deliver to or upon the order of the person or persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section, a Receipt or Receipts for the number of Depositary Shares representing the Stock so deposited and registered in such name or names as may be requested by such person or persons. The Depositary shall execute and deliver such Receipt or Receipts at its Shareholder Services Division and at such other offices, if any, as it may designate. Delivery at other offices shall be at the risk and expense of the person requesting such delivery. However, in each case, any such delivery of a Receipt or Receipts will be made only upon payment to the Depositary of the fee of 3 the Depositary for the execution and delivery of such Receipt, as provided in Section 5.08, and of all taxes and governmental charges and fees payable in connection with such deposit and the transfer of the deposited Stock. SECTION 2.03. REDEMPTION OF STOCK. Whenever the Company shall elect to redeem shares of Stock for shares of Common Stock pursuant to Clause (iii) of the Authorizing Resolution, it shall give the Depositary not less than 45 nor more than 90 days' notice of the date fixed by the Company for such redemption, the number of shares of the Stock held by the Depositary to be so redeemed and the number of shares of Common Stock required pursuant to the Authorizing Resolution in order to effect a redemption of the number of shares of Stock to be redeemed. On the date of such redemption, provided that the Company shall then have deposited with the Depositary the certificates representing the number of shares of Common Stock required pursuant to the Certificate in order to effect a redemption of the number of shares of Stock to be redeemed (together with a cash payment equal to all amounts payable pursuant to the Authorizing Resolution in respect of dividends and fractional shares), the Depositary shall redeem the number of Depositary Shares representing such Stock. The Depositary shall mail notice of such redemption and the simultaneous redemption of the number of Depositary Shares representing the Stock to be redeemed, by first class mail, postage prepaid, not less than 30 and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares (the "Redemption Date"), to the holders of record on the record date for such redemption (determined pursuant to Section 4.04) of the Receipts evidencing the Depositary Shares to be so redeemed, at the address of such holders as the same appear on the records of the Depositary, but neither failure to mail any such notice, nor any defect in any notice, to one or more holders shall affect the sufficiency of the proceedings for redemption as to other holders. Each such notice shall state (i) the record date for the purposes of such redemption; (ii) the redemption date; (iii) the number of Depositary Shares to be redeemed and, if less than all the Depositary Shares evidenced by Receipts held by any such holder are to be redeemed, the number of such Depositary Shares held by such holder to be so redeemed; (iv) the redemption price (expressed as a number of shares of Common Stock); (v) the place or places where Receipts are to be surrendered for certificates representing shares of Common Stock; and (vi) that dividends in respect of the Stock represented by the Depositary Shares to be redeemed will cease to accrue, and the conversion rights in respect thereof will terminate, at the close of business on the Redemption Date. In case less than all the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be so redeemed shall be selected by lot or pro rata (as nearly as may be) or in any other equitable manner selected by the Company. Notice having been mailed by the Depositary as aforesaid, from and after the close of business on the Redemption Date (unless the Company shall have failed to deliver to the Depositary certificates representing shares of Common Stock and cash sufficient to redeem the shares of Stock to be redeemed by it as set forth in the Company's notice provided for in the preceding paragraph), all dividends in respect of the shares of Stock so called for redemption shall cease to accrue, the right to convert such Stock to Common Stock shall terminate and all rights, except the right to receive the number of shares of Common Stock and cash required to redeem such Stock, shall cease. On the Redemption Date, if the Company shall have redeemed the shares of underlying Stock, the Depositary Shares being redeemed shall be deemed no longer to be outstanding, all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the number of shares of Common Stock and cash required to redeem such Stock) shall, to the extent of such Depositary Shares, cease and terminate and, upon surrender in accordance with said notice of the Receipts evidencing any such Depositary Shares (properly endorsed or assigned for transfer, if the Depositary shall so require), such Depositary Shares shall be redeemed by the Depositary at a redemption price per share equal to one-tenth (1/10) (as such fraction may from time to time be adjusted, in certain events, so as to equal at all times the fraction of an interest represented by one Depositary Share in one share of Stock) of the redemption price per share paid in respect of the shares of Stock plus all money and other property, if any, represented thereby including all amounts paid by the Company in respect of dividends pursuant to the Authorizing Resolution. 4 If less than all of the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of such Receipt, without service charge, upon its surrender to the Depositary (with, if the Depositary so requires, due endorsement or a written instrument of transfer in form satisfactory to the Depositary, duly executed by the holder thereof or his attorney duly authorized in writing), together with the payment of the redemption price (in shares of Common Stock and cash in respect of dividends and fractional shares), a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption. SECTION 2.04. TRANSFER OF RECEIPTS. Subject to the terms and conditions of this Deposit Agreement, the Depositary shall register transfer on its books from time to time of Receipts upon any surrender thereof at the Depositary's Shareholder Services Division or at such other offices as it may designate for such purpose by the holder in person or by duly authorized attorney, properly endorsed or accompanied by a properly executed instrument of transfer, and duly stamped as may be required by law. Thereupon the Depositary shall execute a new Receipt or Receipts and deliver the same to or upon the order of the person entitled thereto evidencing the same aggregate number of Depositary Shares as those evidenced by the Receipt or Receipts surrendered. SECTION 2.05. COMBINATIONS AND SPLIT-UPS OF RECEIPTS. Subject to the terms and conditions of this Deposit Agreement, upon surrender of a Receipt or Receipts at the Depositary's corporate trust office in New York City or at such other offices as it may designate for the purpose of effecting a split-up or combination of such Receipt or Receipts, by the holder in person or by duly authorized attorney, properly endorsed or accompanied by a properly executed instrument of transfer, together with written instructions specifying the number of Receipts to be received upon such split-up or combination, the Depositary shall execute and deliver a new Receipt or Receipts in the authorized denominations requested, evidencing the same aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered. SECTION 2.06. SURRENDER OF RECEIPTS AND WITHDRAWAL OF STOCK. Any holder of a Receipt or Receipts representing any number of whole shares of Stock may withdraw the Stock and all money and other property, if any, represented thereby by surrendering such Receipt or Receipts, at the Depositary's Shareholder Services Division or at such other offices as the Depositary may designate for such withdrawals (unless the Depositary Shares represented thereby shall have been theretofore called for redemption). Thereafter, without unreasonable delay, the Depositary shall deliver to such holder, or to the person or persons designated by such holder as hereinafter provided, the number of whole shares of Stock and all money and other property, if any, represented by the Receipt or Receipts so surrendered for withdrawal. If the Receipt or Receipts delivered by the holder to the Depositary in connection with such withdrawal shall evidence a number of Depositary Shares in excess of the number of Depositary Shares representing the number of whole shares of Stock to be so withdrawn, the Depositary shall at the same time, in addition to such number of whole shares of Stock and such money and other property, if any, to be so withdrawn, deliver to such holder, or (subject to Section 2.04) upon his order, a new Receipt evidencing such excess number of Depositary Shares. Delivery of the Stock and money and other property being withdrawn may be made by the delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate, which, if required by law, shall be properly endorsed or accompanied by proper instruments of transfer. If the Stock and the money and other property being withdrawn are to be delivered to a person or persons other than the record holder of the Receipt or Receipts being surrendered for withdrawal of Stock, such holder shall execute and deliver to the Depositary a written order (accompanied by a signature guarantee) so directing the Depositary and the Depositary may require that the Receipt or Receipts surrendered by such holder for withdrawal of such shares of Stock be properly endorsed in blank or accompanied by a properly executed instrument of transfer in blank. 5 Delivery of the Stock and the money and other property, if any, represented by Receipts surrendered for withdrawal shall be made by the Depositary at its Shareholder Services Division, except that, at the request, risk and expense of the holder surrendering such Receipt and for the account of the holder thereof, such delivery may be made at such other place as may be designated by such holder. SECTION 2.07. LIMITATIONS ON EXECUTION AND DELIVERY, TRANSFER AND SURRENDER OF RECEIPTS. As a condition precedent to the execution and delivery, transfer, split-up, combination, surrender or exchange or any Receipt, or the exercise of any conversion right as specified in Section 2.10, the Depositary or any of the Depositary's Agents, or the Company, may require payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any tax or other governmental charge with respect thereto (including any such tax or charge with respect to Stock being deposited or withdrawn or with respect to the Common Stock upon conversion), may require the production of proof satisfactory to it as to the identity and genuineness of any signature and may also require compliance with such regulations, if any, as the Depositary may establish consistent with the provisions of this Deposit Agreement. The deposit of Stock may be refused, or the delivery of Receipts against Stock may be suspended or the transfer of Receipts may be refused, or the exercise of any conversion right as specified in Section 2.10 may be suspended, provided that conversion rights in respect of the Stock are also then lawfully suspended, or the transfer or surrender of outstanding Receipts may be suspended, (a) during any period when the register of stockholders of the Company is closed, or (b) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary's Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of this Deposit Agreement, or, with the approval of the Company, for any other reason. Without limitation of the foregoing, the Depositary shall not knowingly accept for deposit under this Deposit Agreement any shares of Stock which are required to be registered under the Securities Act of 1933, unless a registration statement under such Act is in effect as to such shares of Stock. SECTION 2.08. LOST RECEIPTS, ETC. In case any Receipt shall be mutilated or destroyed or lost or stolen, the Depositary in its discretion may execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt, or in lieu of and in substitution for such destroyed, lost or stolen Receipt, upon (i) the filing by the holder thereof with the Depositary of evidence satisfactory to the Depositary of such destruction or loss or theft of such Receipt, of the authenticity thereof and of his ownership thereof and (ii) the furnishing of the Depositary with reasonable indemnification satisfactory to it, and payment of any expense (including fees and expenses of the Depositary) in connection therewith. SECTION 2.09. CANCELLATION AND DESTRUCTION OF SURRENDERED RECEIPTS. All Receipts surrendered to the Depositary or any Depositary's Agent shall be cancelled by the Depositary. Except as prohibited by applicable law or regulation, the Depositary is authorized to destroy such Receipts so cancelled. SECTION 2.10. CONVERSION OF STOCK INTO COMMON STOCK. (a) Receipts may be surrendered with written instructions to the Depositary to convert any specified number of whole shares of Stock represented by the Depositary Shares evidenced thereby (subject to the provisions of subparagraph (f) below) into shares of Common Stock at the conversion price specified in the Authorizing Resolution with respect to each share of Stock, as such conversion price may be adjusted by the Company from time to time as provided in the Authorizing Resolution. Subject to the terms and conditions of the Deposit Agreement and the Authorizing Resolution, a holder of a Receipt or Receipts evidencing Depositary Shares representing at least one whole share of Stock may surrender such Receipt or Receipts at the Depositary's Shareholder Services Division or at such other office as the Depositary may designate for such purpose, together with the notice of conversion thereon duly completed and executed, thereby instructing the Depositary to convert the number of whole shares of underlying Stock specified in such notice of conversion into shares of Common Stock. 6 (b) Upon receipt by the Depositary of a Receipt or Receipts, together with notice of conversion instructing the Depositary to convert a specified number of whole shares of Stock duly completed and executed, the Depositary shall (i) give written notice to the Company, or its authorized agent, of the number of whole shares of Common Stock to be delivered upon conversion of such shares of Stock and the amount of immediately available funds, if any, to be delivered to the holder of such Receipt or Receipts pursuant to subparagraph (f) below and (ii) deliver to the Company or its authorized agent such Receipt or Receipts, together with certificates for the Stock represented by the Depositary Shares evidenced by such Receipt or Receipts. As promptly as practicable after the receipt of such Receipt or Receipts and certificates from the Depositary, the Company shall furnish or cause to be furnished to the Depositary a certificate or certificates evidencing such number and type of whole shares of Common Stock, and such amount of immediately available funds, if any, as is specified in the written notice to the Company and the Depositary shall deliver at its Shareholder Services Division or otherwise as contemplated by subparagraph (e) below to such holder (x) a certificate or certificates evidencing whole shares of Common Stock into which the Stock represented by the Depositary Shares evidenced by such Receipt or Receipts has been converted, (y) a Receipt evidencing the number of Depositary Shares, if any, evidenced by such Receipt or Receipts in excess of the number of Depositary Shares representing Stock which has been so converted and (z) any money or other property to which the holder is entitled. (c) Upon any such conversion of the Stock underlying the Depositary Shares, no allowance, adjustment or payment shall be made with respect to dividends upon such Stock or shares of Common Stock issued upon the conversion thereof. (d) If any Depositary Shares shall be called for redemption, the Stock underlying such shares may be converted into Common Stock as provided in this Section until and including, but not after (unless the Company shall default in the delivery to the Depositary of certificates representing the number of shares of Common Stock and cash sufficient to redeem such underlying Stock), the close of business on the Redemption Date. (e) Delivery of Common Stock and other property may be made by the delivery of certificates and other proper documents of title, which, if required by law, shall be properly endorsed or accompanied by proper instruments of transfer. If such delivery is to be made otherwise than at the Depositary's corporate trust office in New York City, such delivery shall be made, as hereinafter provided, without unreasonable delay, at the risk and expense of any holder surrendering Receipts, and for the account of such holder, to such place designated in writing by such holder. (f) No fractional shares of Common Stock shall be issuable upon conversion of Stock underlying the Depositary Shares. If, except for the provisions of this paragraph and the Authorizing Resolution, any holder of Receipts surrendered with instructions to the Depositary for conversion of the underlying Stock would be entitled to a fractional share of Common Stock, the Company shall deliver to the Depositary for delivery to such holder, in accordance with subparagraph (b) above, an amount in immediately available funds for such fractional share based upon the current market value of the Common Stock computed as set forth in the Authorizing Resolution. ARTICLE III CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY SECTION 3.01. FILING PROOFS, CERTIFICATES AND OTHER INFORMATION. Any person presenting Stock for deposit or seeking to convert the underlying Stock represented by the Depositary Shares or any holder of a Receipt may be required from time to time to file such proof of residence, or other matters or other information, to execute such certificates and to make such representations and warranties as the Depositary may reasonably deem necessary or proper. The Depositary may withhold the delivery or delay the transfer or redemption of any Receipt or the withdrawal of the Stock represented by the Depositary Shares evidenced by any Receipt or the distribution or sale of any dividend or other 7 distribution or rights or of the proceeds thereof or the exercise of any conversion right as specified in Section 2.10 until such proof or other information is filed or such certificates are executed or such representations and warranties are made. SECTION 3.02. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES. If any tax or other governmental charge shall become payable by or on behalf of the Depositary with respect to any Receipt evidencing Depositary Shares or with respect to the Depositary Shares evidenced by such Receipt or with respect to the Stock (or any fractional interest therein) represented by such Depositary Shares or with respect to the exercise of any conversion right referred to in Section 2.10, such tax (including transfer taxes, if any) or governmental charge shall be payable by the holder of such Receipt. Transfer of any Receipt or any withdrawal of Stock and all money or other property, if any, represented by the Depositary Shares evidenced by such Receipt may be refused until such payment is made, and any dividends or other distributions may be withheld, and such conversion right may be refused, and any part or all of the Stock or other property represented by the Depositary Shares evidenced by such Receipt and not theretofore sold may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder prior to such sale), and such dividends or other distributions or the proceeds of any such sale may be applied to any payment of such tax or other governmental charge, the holder of such Receipt remaining liable for any deficiency. SECTION 3.03. WARRANTIES AS TO STOCK. In the case of the initial deposit of the Stock, the Company and, in the case of subsequent deposits thereof, each person so depositing Stock under this Deposit Agreement shall be deemed thereby to represent and warrant that such Stock and each certificate therefor are valid, that the person making such deposit, or the person on whose behalf such deposit is made, has good and marketable title to such Stock, free and clear of any liens, claims or encumbrances, and that the person making such deposit is duly authorized so to do. The Company hereby further represents and warrants that the Stock, when issued, will be validly issued, fully paid and non-assessable. Such representations and warranties shall survive the deposit of the Stock and the issuance of Receipts. SECTION 3.04. COVENANTS AND WARRANTIES AS TO COMMON STOCK. The Company covenants that it will keep reserved or otherwise available a sufficient number of authorized and unissued shares of Common Stock to meet conversion requirements in respect of the Stock and that it will give written notice to the Depositary of any adjustments in the conversion price as set forth in Clause (v) of the Authorizing Resolution. The Company represents and warrants that the Common Stock issued upon conversion or redemption of Stock will be validly issued, fully paid and non-assessable. ARTICLE IV THE DEPOSITED SECURITIES; NOTICES SECTION 4.01. CASH DISTRIBUTIONS. Whenever the Depositary shall receive any cash dividend or other cash distribution with respect to the Stock, the Depositary shall, subject to Section 3.02, promptly distribute to record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of such sum as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required to withhold and does withhold from any cash dividend or other cash distribution in respect of the Stock an amount on account of taxes, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. The Depositary shall distribute or make available for distribution, as the case may be, only such amount, however, as can be distributed without attributing to any owner of Depositary Shares a fraction of one cent and any balance not so distributable shall be held by the Depositary (without liability for interest thereon) and shall be added to and be treated as part of the next sum received by the Depositary for distribution to record holders of Receipts then outstanding. 8 SECTION 4.02. DISTRIBUTIONS OTHER THAN CASH. Whenever the Depositary shall receive any distribution other than cash with respect to the Stock, the Depositary shall, subject to Section 3.02, promptly distribute to record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders, in any manner that the Depositary may deem equitable and practicable for accomplishing such distribution. If in the opinion of the Depositary such distribution cannot be made proportionately among such record holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes) the Depositary deems, after consultation with the Company, such distribution not to be feasible, the Depositary may, with the approval of the Company, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or private sale) of the securities or property thus received, or any part thereof, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Section 3.02, be distributed or made available for distribution, as the case may be, by the Depositary to record holders of Receipts as provided by Section 4.01 in the case of a distribution received in cash. SECTION 4.03. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES. If the Company shall at any time offer or cause to be offered to the persons in whose names Stock is recorded on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance be made available by the Depositary to the record holders of Receipts on the record date fixed pursuant to Section 4.04 in such manner as the Depositary may determine, either by the issue to such record holders of warrants representing such rights, preferences or privileges or by such other method as may be approved by the Depositary in its discretion with the approval of the Company; provided, however, that (a) if at the time of issue or offer of any such rights, preferences or privileges the Depositary determines that it is not lawful or (after consultation with the Company) not feasible to make such rights, preferences or privileges available to holders of Receipts by the issue of warrants or otherwise, or (b) if and to the extent so instructed by holders of Receipts who do not desire to exercise such rights, preferences or privileges, then the Depositary, in its discretion (with the approval of the Company, in any case where the Depositary has determined that it is not feasible to make such rights, preferences or privileges available), may, if applicable laws and the terms of such rights, preferences or privileges permit such transfer, sell such rights, preferences or privileges at public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Section 3.02, be distributed by the Depositary to the record holders of Receipts entitled thereto as provided by Section 4.01 in the case of a distribution received in cash. If registration under the Securities Act of 1933 of the securities to which any rights, preferences or privileges relate is required in order for holders of Receipts to be offered or sold the securities to which such rights, preferences or privileges relate, the Company agrees with the Depositary that it will file promptly a registration statement pursuant to such Act with respect to such rights, preferences or privileges and securities and use its best efforts and take all steps available to it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In no event shall the Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until such a registration statement shall have become effective, or unless the offering and sale of such securities to such holders are exempt from registration under the provisions of such Act. If any other action under the laws of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company agrees with the Depositary that the Company will use its best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. 9 SECTION 4.04. NOTICE OF DIVIDENDS; FIXING OF RECORD DATE FOR HOLDERS OF RECEIPTS. Whenever any cash dividend or other cash distribution shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered, with respect to Stock, or whenever the Depositary shall receive notice of (a) any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice or (b) any election on the part of the Company to redeem any shares of Stock, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to the Stock) for the determination of the holders of Receipts who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of voting rights at any such meeting, or who shall be entitled to notice of such meeting, or whose Depositary Shares are to be redeemed. SECTION 4.05. VOTING RIGHTS. Upon receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice which shall contain (a) such information as is contained in such notice of meeting, and (b) a statement that the holders of Receipts at the close of business on a specified record date determined pursuant to Section 4.04 will be entitled, subject to any applicable provisions of law and of the Company's Certificate of Incorporation or the Authorizing Resolution, to instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Stock represented by their respective Receipts, and a brief statement as to the manner in which such instructions may be given. Upon the written request of a holder of a Receipt on such record date, the Depositary shall endeavor insofar as practicable to vote or cause to be voted the amount of Stock represented by the Depositary Shares evidenced by such Receipt in accordance with the instructions set forth in such request. The Company hereby agrees to take all action which may be deemed necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting to the extent of the Stock represented by the Depositary Shares evidenced by such Receipt. SECTION 4.06. CHANGES AFFECTING DEPOSITED SECURITIES AND RECLASSIFICATIONS, RECAPITALIZATIONS, ETC. Upon any change in par or stated value, split-up, consolidation or any other reclassification of Stock, or upon any recapitalization, reorganization, merger, amalgamation or consolidation or sale, lease or transfer of all or substantially all of the Company's assets affecting the Company or to which it is a party, the Depositary may, in its discretion (with the approval of) and shall (upon the instructions of) the Company and, in either case, in such manner as the Depositary may deem equitable, treat any securities which shall be received by the Depositary in exchange for or upon conversion of or in respect of the Stock as new deposited securities under this Deposit Agreement, and Receipts then outstanding shall thenceforth represent the new deposited securities so received upon conversion or in respect of such Stock. In any such case the Depositary may, in its discretion, with the approval of the Company, execute and deliver additional Receipts, or call for the surrender of all outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited securities. Anything to the contrary herein notwithstanding, holders of Receipts shall have the right from and after the effective date of any such change in par or stated value, split-up, consolidation or other reclassification of the Stock or any such recapitalization, reorganization, merger, amalgamation or consolidation or sale, lease or transfer of substantially all of the assets of the Company to surrender such Receipts to the Depositary with instructions to convert or surrender the Stock represented thereby only into or for, as the case may be, the kind and amount of shares of stock and other securities and property and cash into which the Stock represented by such Receipts might have been converted or for which such Stock might have been surrendered immediately prior to the effective date of such transaction. The Company shall cause effective provision to be made by the resulting or surviving corporation (if other than the Company) for protection of the conversion rights of holders of Stock or such rights as may be applicable upon exchange of such Stock for securities, cash or other property of the surviving corporation in connection with the transactions set forth above. The Company shall cause any such surviving corporation (if other than the Company) expressly to assume the obligations of the Company hereunder. 10 SECTION 4.07. REPORTS. The Depositary shall make available for inspection by holders of Receipts at its Shareholder Services Division, and at such other places as it may from time to time deem advisable, copies of this Deposit Agreement and the form of Depositary Receipt and any reports and communications received from the Company which are both (a) received by the Depositary as the holder of Stock and (b) made generally available to the holders of Stock by the Company. SECTION 4.08. LISTS OF RECEIPT HOLDERS; ACCESS TO CERTAIN INFORMATION. Promptly upon request from time to time by the Company, the Depositary shall furnish to it a list, as of a recent date, of the names, addresses and holdings of Depositary Shares by all persons in whose names Receipts are registered on the books of the Depositary. Any holder of Depositary Receipts, in person or by attorney or other agent, shall have the right to inspect the transfer books of the Depositary, a list of the holders of the Depositary Receipts, and the Depositary's other books and records pertaining to the Depositary Receipts and Depositary Shares and to make copies therefrom at such holder's expense; provided, however, that the foregoing shall be subject to the limitations and requirements imposed on a stockholder requesting equivalent information from a Delaware corporation pursuant to Section 220(b) of the General Corporation Law of the State of Delaware. ARTICLE V THE DEPOSITARY AND THE COMPANY SECTION 5.01. MAINTENANCE OF OFFICES, AGENCIES, TRANSFER BOOKS BY THE DEPOSITARY; REGISTRAR. Until termination of this Deposit Agreement in accordance with its terms, the Depositary shall maintain in the Borough of Manhattan, City of New York, State of New York, an office or agency for the execution and delivery, transfer, surrender and exchange, split-up, combination, redemption and conversion of Receipts and deposit and withdrawal of Stock and for any other purposes for which such an office or agency is required under the rules of any national securities exchange on which the Depositary Shares are listed. The Depositary shall maintain, or cause one of the Depositary's Agents to maintain, appropriate records which shall reflect registrations, registrations of transfers, exchanges, split-ups and combinations and conversions of Receipts. The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder. If the Receipts or the Depositary Shares evidenced thereby or the Stock represented by such Depositary Shares shall be listed on the New York Stock Exchange, the Depositary may, with the approval of the Company, appoint a Registrar for registry of such Receipts or Depositary Shares in accordance with any requirements of such Exchange. Such Registrar (which may be the Depositary if so permitted by the requirements of such Exchange) may be removed and a substitute registrar appointed by the Depositary upon the request or with the approval of the Company. If the Receipts or such Depositary Shares or such Stock are listed on one or more other stock exchanges, the Depositary will, at the request of the Company, arrange such facilities for the delivery, transfer, surrender and exchange of such Receipts, such Depositary Shares or such Stock as may be required by law or applicable stock exchange regulation. SECTION 5.02. PREVENTION OR DELAY IN PERFORMANCE BY THE DEPOSITARY, THE DEPOSITARY'S AGENTS OR THE COMPANY. Neither the Depositary nor any Depositary's Agent nor the Company shall incur any liability to any holder of any Receipt, if by reason of any provision of any present or future law, or regulation thereunder, of the United States of America, or of any other governmental authority or, in the case of the Depositary or the Depositary's Agent, by reason of any provision, present or future, of the Company's Certificate of Incorporation or the Authorizing Resolution or by reason of any act of God or war or other circumstance beyond the control of the relevant party, the Depositary, any Depositary's Agent or the Company shall be prevented or forbidden from doing or performing any act or thing which the terms of this Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary's Agent or the Company incur any liability to any holder of a Receipt by reason of any non- 11 performance or delay, caused as aforesaid, in the performance of any act or thing which the terms of this Deposit Agreement provide shall or may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement. SECTION 5.03. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS AND THE COMPANY. Neither the Depositary nor any Depositary's Agent nor the Company assumes any obligation or shall be subject to any liability under this Deposit Agreement or any Receipt to holders of Receipts other than that each of them agrees to use its best judgment and good faith in the performance of such duties as are specifically set forth in this Deposit Agreement. Neither the Depositary nor any Depositary's Agent nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of Stock, Depositary Shares, Common Stock or Receipts, which in its opinion may involve it in expense or liability, unless indemnity satisfactory to it against all expense and liability be furnished as often as may be required. Neither the Depositary nor any Depositary's Agent nor the Company shall be liable for any action taken, suffered or omitted by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Stock for deposit, any holder of a Receipt or any other person believed by it in good faith to be competent to give such advice or information. The Depositary, any Depositary's Agent and the Company may each rely and shall each be protected in taking or omitting to take any action upon any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Depositary will indemnify the Company against, and hold it harmless from, any liability which may arise out of acts performed or omitted by the Depositary due to negligence or bad faith. The Depositary and the Depositary's Agents may own and deal in any class of securities of the Company and its affiliates and in Receipts. The Depositary may also act as transfer agent or registrar of any of the securities of the Company and its affiliates. SECTION 5.04. RESIGNATION AND REMOVAL OF THE DEPOSITARY; APPOINTMENT OF SUCCESSOR DEPOSITARY. The Depositary may at any time resign as Depositary hereunder by notice of its election so to do delivered to the Company, such resignation to take effect upon the appointment of a successor depositary and its acceptance of such appointment as hereinafter provided. The Depositary may at any time be removed by the Company by notice of such removal delivered to the Depositary, such removal to take effect upon the appointment of a successor depositary and its acceptance of such appointment as hereinafter provided. In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall, within 60 days after the delivery of the notice of resignation or removal, as the case may be, appoint a successor depositary, which shall be a bank or trust company having its principal office in the United States of America and having a combined capital and surplus of at least $50,000,000. Every successor depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit Agreement, and such predecessor, upon payment of all sums due it and on the written request of the Company, shall execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Stock and any moneys or property held hereunder to such successor, and shall deliver to such successor a list of the record holders of all outstanding Receipts. Any successor Depositary shall promptly mail notice of its appointment to the record holders of Receipts. 12 Any corporation into or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or any further act. Such successor Depositary may authenticate the Receipts in the name of the predecessor Depositary or in the name of the successor Depositary. SECTION 5.05. CORPORATE NOTICES AND REPORTS. The Company agrees that it will deliver to the Depositary, and the Depositary will, promptly after receipt thereof, transmit to the record holders of Receipts, in each case at the address recorded in the Depositary's books, copies of all notices and reports (including, without limitation, financial statements) required by law, by the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are listed or by the Company's Certificate of Incorporation and the Authorizing Resolution to be furnished by the Company to holders of Stock. Such transmission will be at the Company's expense and the Company will provide the Depositary with such number of copies of such documents as the Depositary may reasonably request. In addition, the Depositary will transmit to the holders of Receipts (at the Company's expense) such other documents as may be requested by the Company. SECTION 5.06. DEPOSIT OF STOCK BY THE COMPANY. The Company agrees with the Depositary that neither the Company nor any company controlled by the Company will at any time deposit any Stock, if such Stock is required to be registered under the provisions of the Securities Act of 1933 and no registration statement is at such time in effect as to such Stock. SECTION 5.07. INDEMNIFICATION BY THE COMPANY. The Company agrees to indemnify the Depositary, any Depositary's Agent and any Registrar against, and hold each of them harmless from, (i) any liability which may arise out of acts performed or omitted in accordance with the provisions of this Deposit Agreement or the Receipts, as the same may be amended, modified or supplemented from time to time, (a) by the Depositary, any Registrar or any of their respective agents (including any Depositary's Agent), except for any liability arising out of negligence or bad faith on the part of any such person or persons, or (b) by the Company or any of its agents, or (ii) any liability or expense which may arise out of or in connection with the registration of Stock or the offer or sale to the public of the Stock or the offer or sale of the Receipts except to the extent that such liability or expense arises out of information furnished by the Depositary. SECTION 5.08. CHARGES AND EXPENSES. If, at the election of a holder of Stock or Receipts, any delivery or communication from the Depositary to such holder is by telegram or telex or if the Depositary incurs charges or expenses for which it is not otherwise liable hereunder at the election of such holder, such holder will be liable for such charges and expenses. All other charges and expenses of the Depositary and any Depositary's Agent hereunder and of any Registrar (including, in each case, fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be paid upon consultation and agreement between the Depositary and the Company as to the amount and nature of such charges and expenses. The Depositary shall present its statement for charges and expenses to the Company every month. SECTION 5.09. AUTHORIZATION OF AGREEMENT. The Depositary represents and warrants that this Deposit Agreement has been duly and validly authorized by the Depositary. ARTICLE VI AMENDMENT; TERMINATION SECTION 6.01. AMENDMENT. The form of the Receipts and any provisions of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable; provided, however, that no such amendment that shall materially and adversely alter the rights of the holders of Receipts shall be effective unless such amendment shall have been approved by the holders of at least 66 2/3% of the Depositary Shares then outstanding. Upon the execution of any such agreement to so amend this Deposit Agreement, except as hereinafter provided, such amendment shall become effective and shall form a part of 13 this Deposit Agreement for all purposes. Every holder of an outstanding Receipt at the time any such amendment so becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by the Deposit Agreement as amended thereby. In no event shall any amendment impair the right, subject to the provisions of Sections 2.06 and 2.10 and Article III, of any owner of any Depositary Shares to surrender the Receipt evidencing such Depositary Shares with instructions to the Depositary to convert such shares into Common Stock or to deliver to the holder the Stock and all money and other property, if any, represented thereby, except in order to comply with mandatory provisions of applicable law or the rules and regulations of any governmental body, agency or commission, the National Association of Securities Dealers, Inc. or any applicable stock exchange. SECTION 6.02. TERMINATION. This Agreement may be terminated by the Company or the Depositary only after (i) all outstanding Depositary Shares shall have been redeemed pursuant to Section 2.03 and all shares of Common Stock, cash and other property shall have been distributed to holders of Depositary Shares, (ii) there shall have been made a final distribution in respect of the Stock in connection with any voluntary or involuntary liquidation, dissolution or winding-up of the Company and such distribution shall have been distributed to the holders of Depositary Shares pursuant to Section 4.01 or 4.02, as applicable, or (iii) each share of Stock shall have been converted into shares of Common Stock and all shares of Common Stock, cash and other property shall have been distributed to holders of Depositary Shares. Upon the termination of this Deposit Agreement, the parties hereto shall be discharged from all obligations under this Deposit Agreement except for their respective obligations under Sections 5.03, 5.07 and 5.08. ARTICLE VII MISCELLANEOUS SECTION 7.01. COUNTERPARTS. This Deposit Agreement may be executed in any number of counterparts, and by each of the parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same instrument. Copies of this Deposit Agreement shall be filed with the Depositary and the Depositary's Agents and shall be open to inspection during business hours at the Depositary's Shareholder Services Division by any holder of a Receipt. SECTION 7.02. EXCLUSIVE BENEFIT OF PARTIES. This Deposit Agreement is for the exclusive benefit of the parties hereto, and their respective successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever. SECTION 7.03. INVALIDITY OF PROVISIONS. In case any one or more of the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby. SECTION 7.04. NOTICES. Any and all notices to be given to the Company hereunder or under the Depositary Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or telegram or telex confirmed by letter, addressed to the Company at 2900 Semiconductor Drive, Santa Clara, California 95052-8090, Attention: Corporate Secretary, or at any other place to which the Company may have transferred its principal executive office. Any and all notices to be given to the Depositary hereunder or under the Depositary Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or by telegram or telex confirmed by letter, addressed to the Depositary at its Shareholder Services Division. Any and all notices to be given to any record holder of a Receipt hereunder or under the Depositary Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or by telegram or telex confirmed by letter, addressed to such record holder at the address of 14 such record holder as it appears on the books of the Depositary, or if such holder shall have filed with the Depositary a written request that notices intended for such holder be mailed to some other address, at the address designated in such request. Delivery of a notice sent by mail or by telegram or telex shall be deemed to be effected at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a telegram or telex message) is deposited, postage prepaid, in a post office letter box. The Depositary or the Company may, however, act upon any telegram or telex message received by it from the other or from any holder of a Receipt, notwithstanding that such telegram or telex message shall not subsequently be confirmed by letter or as aforesaid. SECTION 7.05. DEPOSITARY'S AGENTS. The Depositary may from time to time appoint Depositary's Agents to act in any respect for the Depositary for the purposes of this Deposit Agreement and may at any time appoint additional Depositary's Agents and vary or terminate the appointment of such Depositary's Agents. The Depositary will notify the Company of any such action. SECTION 7.06. HOLDERS OF RECEIPTS ARE PARTIES. The holders of Receipts from time to time shall be deemed to be parties to this Deposit Agreement and shall be bound by all of the terms and conditions hereof and of the Receipts by acceptance of delivery thereof. SECTION 7.07. GOVERNING LAW. The Deposit Agreement and the Receipts and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by, and construed in accordance with, the laws of the State of New York. SECTION 7.08. HEADINGS. The headings of Articles and Sections in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereto have been inserted for convenience only and are not to be regarded as a part of this Deposit Agreement or to have any bearing upon the meaning or interpretation of any provision contained herein or in the Receipts. IN WITNESS WHEREOF, NATIONAL SEMICONDUCTOR CORPORATION AND THE FIRST NATIONAL BANK OF BOSTON have duly executed this Agreement and affixed their respective seals hereto as of the day and year first above set forth and all holders of Receipts shall become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms hereof. [SEAL] NATIONAL SEMICONDUCTOR CORPORATION Attest: /s/ JOHN M. CLARK III By /s/ DONALD MACLEOD - -------------------------------------------- ----------------------------------------- John M. Clark III Donald Macleod Authorized Officer Secretary [SEAL] THE FIRST NATIONAL BANK OF BOSTON Attest: /s/ KENYON BISSELL By /s/ CRAIG A. ALIE - -------------------------------------------- ----------------------------------------- Kenyon Bissell Craig A. Alie Authorized Officer Secretary
15 EXHIBIT A DEPOSITARY RECEIPT FOR DEPOSITARY CONVERTIBLE PREFERRED SHARES, EACH REPRESENTING ONE-TENTH (1/10) $ CONVERTIBLE PREFERRED SHARE ($.50 PAR VALUE PER SHARE, $500 LIQUIDATION VALUE PER SHARE) OF NATIONAL SEMICONDUCTOR CORPORATION (INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE) No. ______________ Depositary Convertible Preferred Shares (each representing one-tenth (1/10) $ Convertible Preferred Share ($.50 par value per share, $500 liquidation value per share)) 1. The First National Bank of Boston, a national banking association duly organized and existing under the laws of the United States of America, as Depositary (the "Depositary"), hereby certifies that is the registered owner of Depositary Convertible Preferred Shares ("Depositary Shares"), each Depositary Share representing one-tenth (1/10) (as such fraction may from time to time be adjusted in the event of certain amendments to the Certificate of Incorporation) of one $ Convertible Preferred Share ($.50 par value per share, $500 liquidation value per share) (the "Stock"), of NATIONAL SEMICONDUCTOR CORPORATION, a corporation duly organized and existing under the laws of the State of Delaware (the "Company") deposited with, and held by, the Depositary. The rights, preferences and limitations of the Stock are set forth in the resolution adopted by the Company's Board of Directors (the "Authorizing Resolution"), copies of which are on file at the Depositary's Shareholder Services Division at 150 Royall Street, Canton, Massachusetts 02021. 2. THE DEPOSIT AGREEMENT. Depositary Receipts (the "Receipts"), of which this Receipt is one, are made available upon the terms and conditions set forth in the Deposit Agreement, dated as of September , 1992 (the "Deposit Agreement"), among the Company, the Depositary and all holders from time to time of Receipts. The Deposit Agreement (copies of which are on file at the Depositary's Shareholder Services Division) sets forth the rights of holders of receipts and the rights and duties of the Depositary in respect of the Stock deposited, and any and all other property and cash from time to time held thereunder. The statements made on the face and the reverse of this Receipt are summaries of certain provisions of the Deposit Agreement and are subject to the detailed provisions thereof, to which reference is hereby made. Unless otherwise expressly herein provided, all defined terms used herein shall have the meanings ascribed thereto in the Deposit Agreement. 3. REDEMPTION OF STOCK. Whenever the Company shall elect to redeem shares of Stock pursuant to the Authorizing Resolution, it shall give the Depositary not less than 45 nor more than 90 days' notice of the date fixed by the Company for such redemption, the number of shares of Stock held by the Depositary to be redeemed and the redemption price (expressed as a number of shares of Common Stock) for the Stock to be so redeemed (which shall include full cumulative dividends thereon to the Redemption Date). The Depositary shall mail notice of such redemption and the simultaneous redemption of a corresponding number of Depositary Shares relating to the Stock to be redeemed not less than 30 and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares to the holders of record on the record date for such redemption (determined as provided in Paragraph 16 below) of the Depositary Shares to be so redeemed. In case less than all the outstanding Depositary A-1 Shares are to be so redeemed, the Depositary Shares to be so redeemed shall be selected by lot or pro rata (as nearly as may be) or in any other equitable manner selected by the Company. Notice having been mailed as aforesaid, from and after the close of business on the date set for redemption (unless the Company shall have failed to deliver to the Depositary certificates representing shares of Common Stock and cash sufficient to redeem the shares of Stock to be redeemed by it on such date), all dividends in respect of the Stock so called for redemption shall cease to accrue, the right to convert such Stock for Common Stock shall terminate, the Depositary Shares so called for redemption shall be deemed to be no longer outstanding, all rights of holders of Receipts evidencing such Depositary Shares (except the right to receive the redemption price) shall, to the extent of such Depositary Shares, cease and terminate and, upon surrender in accordance with said notice of the Receipts evidencing such Depositary Shares (properly endorsed or assigned for transfer, if the Depositary shall so require), such Depositary Shares shall be redeemed by the Depositary for the number of shares of Common Stock specified in said notice, plus all money and other property, if any, represented by such Depositary Shares, including all amounts payable by the Company pursuant to the Authorizing Resolution in respect of dividends and fractional shares. If less than all of the Depositary Shares evidenced by this Receipt are called for redemption, the Depositary will deliver to the record holder of this Receipt, without service charge, upon its surrender to the Depositary (with, if the Depositary so requires, due endorsement or a written instrument of transfer in form satisfactory to the Depositary, duly executed by the holder thereof or his attorney duly authorized in writing), together with the payment of the redemption price (in shares of Common Stock plus cash in respect of dividends payable and fractional shares, if any), a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption. 4. SURRENDER OF RECEIPTS AND WITHDRAWAL OF STOCK. Upon surrender of this Receipt to the Depositary at its Shareholder Services Division, or at such other offices as it may designate, and subject to the provisions of the Deposit Agreement (unless the Depositary Shares evidenced hereby have been theretofore called for redemption), the holder hereof is entitled to withdraw, and to obtain delivery, to or upon the order of such holder, of the Stock and all money and other property, if any, at the time represented thereby; provided, however, that in the event this Receipt shall evidence a number of Depositary Shares in excess of the number of Depositary Shares representing the number of whole shares of Stock to be so withdrawn, the Depositary shall, in addition to such number of whole shares of Stock and the money and other property, if any, to be so withdrawn, deliver, to or upon the order of such holder, a new Receipt evidencing such excess number of Depositary Shares. 5. CONVERSION OF STOCK. Receipts may be surrendered at the place or places specified in the preceding paragraph with written instructions to the Depositary to convert any specified number of whole shares of Stock represented by Depositary Shares evidenced hereby into shares of Common Stock of the Company at the conversion price specified in the Authorizing Resolution, as such conversion price may be adjusted from time to time by the Company as provided in the Authorizing Resolution. Upon conversion of such whole shares of Stock, no allowance, adjustment or payment shall be made with respect to dividends on such Stock or Common Stock and no fractional shares of Common Stock shall be issued; however, a cash payment will be made by the Company in lieu thereof on the basis of the then current market value of such fractional shares, as provided in the Authorizing Resolution. 6. TRANSFERS, SPLIT-UPS, COMBINATIONS. This Receipt is transferable on the books of the Depositary upon surrender of this Receipt to the Depositary, properly endorsed or accompanied by a properly executed instrument of transfer, and upon such transfer the Depositary shall sign and deliver a Receipt to or upon the order of the person entitled thereto, as provided in the Deposit Agreement. This Receipt may be split into other Receipts or combined with other Receipts into one Receipt evidencing the same aggregate number of Depositary Shares and evidenced by the Receipt or Receipts surrendered. 7. CONDITIONS TO SIGNING AND DELIVERY, TRANSFER, ETC., OF RECEIPTS. Prior to the execution and delivery, transfer, split-up, combination, delivery for purposes of conversion, surrender or exchange of this Receipt, the Depositary, or any of the Depositary's Agents, or the Company, may require payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any tax or other governmental charge with respect thereto A-2 (including any such tax or charge with respect to Stock being deposited or withdrawn, converted or exchanged), may require proof satisfactory to it as to the identity and genuineness of any signature and may also require compliance with such regulations, if any, as it may establish pursuant to the Deposit Agreement. Any person presenting Stock for deposit, or any holder of this Receipt, may be required to file such information, and to execute such certificates, as the Depositary or the Company may reasonably deem necessary or proper. 8. SUSPENSION OF DELIVERY, TRANSFER, ETC. The deposit of Stock, the delivery of this Receipt against Stock, the transfer, surrender or exchange of this Receipt or the exercise of any conversion right may be refused or suspended (a) during any period when the register of stockholders of the Company is closed, or (b) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary's Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of the Deposit Agreement or, with the approval of the Company, for any other reason. 9. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES. If any tax or other governmental charge shall become payable by or on behalf of the Depositary with respect to this Receipt or with respect to the Depositary Shares evidenced hereby or with respect to the Stock (or any fractional interest therein) represented by such Depositary Shares, or with respect to the exercise of any conversion right, such tax (including transfer taxes, if any) or governmental charge shall be payable by the holder hereof. Transfer of this Receipt or any withdrawal of the Stock and all money and other property, if any, represented by the Depositary Shares evidenced by this Receipt may be refused until such payment is made, and any dividends or other distributions may be withheld, and such conversion right may be refused, or any part or all of the Stock or other property represented by the Depositary Shares evidenced by this Receipt and not theretofore sold may be sold for the account of the holder hereof, and such dividends or other distributions or the proceeds of any such sale may be applied to any payment of such tax or other governmental charge, the holder of this Receipt remaining liable for any deficiency. 10. WARRANTIES BY DEPOSITOR. In the case of the initial deposit of Stock, the Company and, in the case of subsequent deposits thereof, each person so depositing Stock under the Deposit Agreement shall be deemed thereby to represent and warrant that such Stock and each certificate therefor are valid, that the person making such deposit, or the person on whose behalf such deposit is made, has good and marketable title to such Stock, free and clear of any liens, claims or encumbrances, and that the person making such deposit is duly authorized so to do. 11. AMENDMENT. The form of the Receipts and any provisions of the Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable; provided, however, that no such amendment that shall materially and adversely alter the rights of the holders of Receipts shall be effective unless such amendment shall have been approved by the holders of at least 66 2/3% of the Depositary Shares then outstanding. The holder of this Receipt at the time any such amendment so becomes effective shall be deemed, by continuing to hold this Receipt, to consent and agree to such amendment and to be bound by the Deposit Agreement as amended thereby. In no event shall any amendment impair the right, subject to the provisions of Paragraphs 8 and 9 hereof and of Sections 2.06 and 2.10 and Article III of the Deposit Agreement, of the owner of the Depositary Shares evidenced by this Receipt to surrender this Receipt with instructions to the Depositary to convert such shares into Common Stock or to deliver to the holder the Stock and all money and other property, if any, represented thereby, except in order to comply with mandatory provisions of applicable law or the rules and regulations of any governmental body, agency or commission, the National Association of Securities Dealers, Inc. or any applicable stock exchange. 12. CHARGES OF DEPOSITARY. The Company will pay all charges of the Depositary, except for taxes and other governmental charges, and such telegram, telex, delivery and other charges as are expressly provided in the Deposit Agreement to be at the expense of persons depositing Stock or holders of Depositary Receipts. A-3 13. TITLE TO RECEIPTS. It is a condition of this Receipt, and every successive holder thereof by accepting or holding the same consents and agrees, that title to this Receipt (and to the Depositary Shares evidenced hereby), when properly endorsed or accompanied by a properly executed instrument of transfer, is transferable by delivery with the same effect as in the case of a negotiable instrument; provided, however, that until this Receipt shall be transferred on the books of the Depositary as provided in Section 2.04 of the Deposit Agreement, the Depositary, each Depositary's Agent and the Company may, notwithstanding any notice to the contrary, treat the record holder hereof at such time as the absolute owner hereof for the purpose of determining the person entitled to distribution of dividends or other distributions or the exercise of conversion rights or to any notice provided for in the Deposit Agreement and for all other purposes. 14. DIVIDENDS AND DISTRIBUTIONS. Whenever the Depositary receives any cash dividend or other cash distribution with respect to the Stock, the Depositary will, subject to the provisions of the Deposit Agreement, promptly distribute to the holders of Receipts such amounts of such sum as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that the amount distributed will be reduced by any amounts required to be withheld by the Company or the Depositary on account of taxes. Whenever the Depositary receives any distribution other than cash with respect to the Stock, the Depositary will, subject to the provisions of the Deposit Agreement, promptly distribute to the holders of Receipts such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that if in the opinion of the Depositary such distribution cannot be made proportionately among such record holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes), the Depositary deems such distribution not to be feasible, the Depositary may effect such distribution in the manner provided in the Deposit Agreement. 15. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES. If the Company shall at any time offer to the record holders of the Stock any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance, subject to the provisions of the Deposit Agreement, be made available by the Depositary to the record holders of Receipts on the record date fixed as determined in Paragraph 16 in such manner as the Depositary may determine, either by the issue to such record holders of warrants representing such rights, preferences or privileges or by such other method as may be approved by the Depositary in its discretion with the approval of the Company; provided, however, that (a) if at the time of issue or offer of any such rights, preferences or privileges the Depositary determines that it is not lawful or (after consultation with the Company) not feasible to make such rights, preferences or privileges available to holders of Receipts by the issue of warrants or otherwise, or (b) if and to the extent so instructed by holders of Receipts who do not desire to exercise such rights, preferences or privileges, the Depositary, in its discretion (with the approval of the Company, in any case where the Depositary has determined that it is not feasible to make such rights, preferences or privileges available), may, if applicable laws or the terms of such rights, preferences or privileges permit such transfer, sell such rights, preferences or privileges at public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to the provisions of Paragraph 9 hereof, be distributed by the Depositary to the record holders of Receipts entitled hereto as in the case of a distribution received in cash. If any other action (including the registration under the Securities Act of 1933 of the securities to which any rights, preferences or privileges relate) under the laws of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company will use its best efforts and take all steps available to it to obtain such registration, authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable holders of Receipts to exercise such rights, preferences or privileges. In no event shall the Depositary make available to the holders of A-4 Receipts any right, preference or privilege to subscribe for or to purchase any securities unless or until the relevant registration statement shall have become effective, or unless the offering and sale of such securities to such holders are exempt from registration under the provisions of such Act. 16. FIXING OF RECORD DATE. Whenever any cash dividend or other cash distribution shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered, with respect to the Stock, or whenever the Depositary shall receive notice of (a) any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice or (b) any election on the part of the Company to redeem any shares of Stock, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to the Stock) for the determination of the holders of Receipts who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of voting rights at any such meeting, or who shall be entitled to notice of such meeting, or whose Depositary Shares are to be redeemed. 17. VOTING RIGHTS. Upon receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable, mail to the record holders of Receipts a notice which shall contain (a) such information as is contained in such notice of meeting, and (b) a statement that the holders of Receipts at the close of business on a specified record date determined as provided in Paragraph 16 will be entitled, subject to any applicable provisions of law and of the Company's Certificate of Incorporation or the Authorizing Resolution, to instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Stock represented by the Depositary Shares evidenced by their respective Receipts, and a brief statement as to the manner in which such instructions may be given. Upon the written request of a holder of a Receipt on such record date, the Depositary shall endeavor insofar as practicable to vote or cause to be voted the amount of Stock represented by the Depositary Shares evidenced by such Receipt in accordance with the instructions set forth in such request. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting to the extent of the Stock represented by the Depositary Shares evidenced by such Receipt. 18. CHANGES AFFECTING DEPOSITED SECURITIES. Upon any change in par or stated value, split-up, consolidation or any other reclassification of the Stock, or upon any recapitalization, reorganization, merger, amalgamation or consolidation or sale, lease or transfer of all or substantially all of the Company's assets affecting the Company or to which it is a party, the Depositary may, in its discretion (with the approval of) and shall (upon the instructions of) the Company and, in either case, in such manner as the Depositary may deem equitable, treat any securities which shall be received by the Depositary in exchange for or in respect of the Stock as new deposited securities under the Deposit Agreement, and Receipts then outstanding shall thenceforth represent the new deposited securities so received in exchange for or in respect of such Stock. In any such case the Depositary may, in its discretion, with the approval of the Company, execute and deliver additional Receipts, or may call for the surrender of outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited securities. 19. REPORTS; INSPECTION OF TRANSFER BOOKS. The Depositary shall make available for inspection by holders of Receipts at its Shareholder Services Division and at such other places as it may from time to time deem advisable any reports and communications received from the Company which are both (a) received by the Depositary as the holder of Stock and (b) made generally available to the holders of Stock by the Company. The Depositary shall also send to record holders of Receipts copies of such notices, reports and other financial statements to the extent provided in the Deposit Agreement when furnished by the Company. The Depositary shall maintain, or cause one of the Depositary's Agents to maintain, appropriate records which shall reflect registrations, registrations of transfers, exchanges, split-ups and combinations and conversions of Receipts. The Depositary shall make available at its office or agency in New York City for inspection by any holder of a Receipt in the same manner and for the same purposes that holders of Stock are entitled to inspect the list of holders of Stock of the Company, a list of holders of record of the Receipts. A-5 20. LIABILITY OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS AND THE COMPANY. Neither the Depositary nor any Depositary's Agent nor the Company shall incur any liability to any holder of any Receipt, if by reason of any provision of any present or future law or regulation of any governmental authority or, in the case of the Depositary or any Depositary's Agent, by reason of any provision, present or future, of the Company's Certificate of Incorporation or the Authorizing Resolution or by reason of any act of God or war or other circumstance beyond the control of the relevant party, the Depositary, any Depositary's Agent or the Company shall be prevented or forbidden from doing or performing any act or thing which the terms of the Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary's Agent or the Company incur any liability to any holder of a Receipt by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing which the terms of the Deposit Agreement provide shall or may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in the Deposit Agreement. 21. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS AND THE COMPANY. Neither the Depositary nor any Depositary's Agent nor the Company assumes any obligation or shall be subject to any liability under the Deposit Agreement or any Receipt to holders of Receipts other than that each of them agrees to use its best judgment and good faith in the performance of such duties as are specifically set forth in the Deposit Agreement. Neither the Depositary nor any Depositary's Agent nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of Stock, Depositary Shares, Common Stock or Receipts, which in its opinion may involve it in expense or liability, unless indemnity satisfactory to it against all expense and liability be furnished as often as may be required. Neither the Depositary nor any Depositary's Agent nor the Company will be liable for any action taken, suffered or omitted by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Stock for deposit, any holder of a Receipt or any other person believed by it in good faith to be competent to give such advice or information. The Company will indemnify the Depositary against any liability which may arise out of acts performed or omitted in accordance with the provisions of the Deposit Agreement or the Receipts, (a) by the Depositary or any Registrar, or any of their respective agents (including any Depositary's Agent), except for any liability arising out of their negligence or bad faith, or (b) by the Company or any of its agents. The Depositary will indemnify the Company against any liability which may arise out of acts performed or omitted by the Depositary or its agents due to negligence or bad faith. The Depositary and the Depositary's Agents may own and deal in any class of securities of the Company and its affiliates and in Receipts. The Depositary may also act as transfer agent or registrar of any of the securities of the Company and its affiliates. 22. RESIGNATION AND REMOVAL OF DEPOSITARY. The Depositary may at any time (a) resign by notice of its election so to do delivered to the Company, such resignation to take effect upon the appointment of a successor depositary and its acceptance of such appointment, or (b) be removed by the Company by notice of such removal delivered to the Depositary, such removal to take effect upon the appointment of a successor depositary and its acceptance of such appointment, all as provided in the Deposit Agreement. 23. TERMINATION OF DEPOSIT AGREEMENT. The Deposit Agreement may be terminated by the Company or the Depositary only upon or after the occurrence of any of the following events: (i) all outstanding Depositary Shares shall have been redeemed and all shares of Common Stock, cash and other property shall have been distributed to holders of Depositary Shares; (ii) there shall have been made a final distribution in respect of the Stock in connection with any voluntary or involuntary liquidation, dissolution or winding-up of the Company and such distribution shall have been distributed to the holders of Depositary Shares; or (iii) each share of Stock shall have been converted into shares of Common Stock and all shares of Common Stock, cash and other property shall have been distributed to holders of Depositary Shares. Upon the termination of the Deposit Agreement, the Company shall be discharged from all obligations thereunder except for its obligations thereunder to the Depositary with respect to indemnification, charges and expenses. A-6 24. GOVERNING LAW. The Deposit Agreement and this Receipt and all rights thereunder and hereunder and provisions thereof and hereof shall be governed by, and construed in accordance with, the laws of the State of New York. This Receipt shall not be entitled to any benefits under the Deposit Agreement or be valid or obligatory for any purpose, unless this Receipt shall have been executed manually, or if a Registrar for the Receipts (other than the Depositary) shall have been appointed, by facsimile signature of a duly authorized officer of the Depositary and, if executed by such facsimile signature, shall have been countersigned manually by such Registrar by the signature of a duly authorized signatory. Dated: THE FIRST NATIONAL BANK OF BOSTON Depositary By ___________________________________ Authorized Officer A-7 [FORM OF NOTICE OF CONVERSION] The undersigned holder of this Receipt for Depositary Convertible Preferred Shares (the "Depositary Shares"), hereby irrevocably exercises the option to convert whole shares of the underlying $ Convertible Preferred Stock (the "Stock"), represented by this Receipt into shares of Common Stock (and any other applicable securities or property) of National Semiconductor Corporation in accordance with the terms of and conditions of the Stock including the Authorizing Resolution in respect thereof and further as provided in Section 2.10 of the Deposit Agreement, dated as of September , 1992, among National Semiconductor Corporation, The First National Bank of Boston as Depositary, and the holders from time to time of Receipts referred to in such Deposit Agreement, and directs that the securities deliverable upon such conversion be registered in the name of and delivered, together with a check in payment for any fractional share and any other property deliverable upon such conversion, to the undersigned unless a different name has been indicated below. If securities are to be registered in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. If the number of shares of the Stock indicated above is less than the number of shares of such Stock on deposit in respect of this Receipt, the undersigned directs that the Depositary issue to the undersigned, unless a different name is indicated below, a new Receipt eviden- cing Depositary Shares for the balance of the Stock not to be converted. Dated: Signature ____________________________ NOTE: The above signature should correspond exactly with the name on the face of this Receipt or with the name of the assignee appearing in the assignment form below. (Please print name and address of registered holder) Name _________________________________ Address ______________________________ (Please indicate other delivery instructions, if applicable) Name _________________________________ Address ______________________________ A-8 [FORM OF ASSIGNMENT] FOR VALUE RECEIVED, the undersigned hereby settles, assigns and transfers unto the within Receipt and all rights and interests represented by the Depositary Shares evidenced thereby, and hereby irrevocably constitutes and appoints his attorney, to transfer the same on the books of the within-named Depositary, with full power of substitution in the premises. Dated: Signature ____________________________ NOTE: The above signature should correspond exactly with the name on the face of this Receipt. A-9 EX-5 7 EXHIBIT 5 EXHIBIT 5 Letterhead of Latham & Watkins March 22, 1994 National Semiconductor Corporation 2900 Semiconductor Drive P.O. Box 58090 Santa Clara, California 95052 Re: National Semiconductor Corporation Common Stock, Par Value $.50 ---------------------------- Ladies and Gentlemen: This opinion is rendered in connection with the filing by National Semiconductor Corporation, a Delaware corporation (the "Company"), of its Registration Statement on Form S-3 (the "Registration Statement") with the Securities and Exchange Commission under the Securities Act of 1933, as amended, with respect to the offer and sale of up to 8,250,000 shares of the Company's Common Stock, par value of $.50 per share (the "Common Stock"). We have acted as counsel to the Company in connection with the preparation of the Registration Statement. In our capacity as such counsel, we are familiar with the proceedings taken and to be taken by the Company in connection with the authorization, issuance and sale of the Common Stock. In addition, we have made such legal and factual examinations and inquiries, including an examination of originals (or copies certified or otherwise identified to our satisfaction as being true reproductions of originals) of such documents, corporate records and other instruments, and have obtained from officers of the Company and agents thereof such certificates and other representations and assurances, as we have deemed necessary or appropriate for the purposes of this opinion. In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the legal capacity of natural persons executing such documents and the authenticity and conformity to original documents of documents submitted to us as certified or photostatic copies. Page 2 Based upon the foregoing and the proceedings to be taken by the Company as referred to above, we are of the opinion that the Common Stock has been duly authorized, and upon issuance, delivery and payment therefor, the Common Stock will be validly issued, fully paid and nonassessable. Our opinion herein is limited to the effect on the subject transaction of United States Federal law and the General Corporation Law of the State of Delaware. We assume no responsibility regarding the applicability to, or the effect thereon, of the laws of any other jurisdiction. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm contained under the heading "Legal Matters" of the prospectus included therein. Very truly yours, /s/ LATHAM & WATKINS EX-23.A 8 EXHIBIT 23A EXHIBIT 23-A CONSENT OF INDEPENDENT AUDITORS THE BOARD OF DIRECTORS AND SHAREHOLDERS NATIONAL SEMICONDUCTOR CORPORATION We consent to the use of our reports dated June 11, 1993, incorporated herein by reference, and to the reference to our firm under the heading "Experts" in the prospectus. /s/ KPMG PEAT MARWICK San Jose, California March 21, 1994 EX-24 9 EXHIBIT 24 EXHIBIT 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned persons hereby constitutes and appoints Gilbert F. Amelio, Donald Macleod, and John M. Clark III, and each of them singly, his true and lawful attorney-in-fact and in his name, place, and stead, and in any and all of his offices and capacities with National Semiconductor Corporation, to sign the Registration Statement with which this Power of Attorney is filed, and any and all amendments to said Registration Statement, and generally to do and perform all things and acts necessary or advisable in connection therewith, and each of the undersigned hereby ratifies and confirms all that each of said attorneys-in-fact may lawfully do or cause to be done by virtue hereof. IN WITNESS WHEREOF, each of the undersigned has hereunto executed this Power of Attorney as of the date set forth opposite his signature. SIGNATURE DATE --------- ---- /s/ GILBERT F. AMELIO - ----------------------------------- March 14, 1994 Gilbert F. Amelio /s/ PETER J. SPRAGUE - ----------------------------------- March 15, 1994 Peter J. Sprague /s/ GARY P. ARNOLD - ----------------------------------- March 10, 1994 Gary P. Arnold /s/ ROBERT BESHAR - ----------------------------------- March 10, 1994 Robert Beshar /s/ MODESTO A. MAIDIQUE - ----------------------------------- March 15, 1994 Modesto A. Maidique /s/ J. TRACY O'ROURKE - ----------------------------------- March 10, 1994 J. Tracy O'Rourke /s/ CHARLES E. SPORCK - ----------------------------------- March 11, 1994 Charles E. Sporck /s/ DONALD E. WEEDEN - ----------------------------------- March 10, 1994 Donald E. Weeden POWER OF ATTORNEY (Page 2) /s/ DONALD MACLEOD - ----------------------------------- March 11, 1994 Donald Macleod /s/ ROBERT B. MAHONEY - ----------------------------------- March 14, 1994 Robert B. Mahoney -----END PRIVACY-ENHANCED MESSAGE-----