-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, U6SX1MXJRt6WCOu5du6LI4L8ybRl7zwHIQS+XvnJdf728Urg8H9sWHhOaZ4N2TGT stWltp1mChrCMLvgq12fKw== 0000725182-96-000091.txt : 19961227 0000725182-96-000091.hdr.sgml : 19961227 ACCESSION NUMBER: 0000725182-96-000091 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 19961224 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19961226 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: AST RESEARCH INC /DE/ CENTRAL INDEX KEY: 0000725182 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC COMPUTERS [3571] IRS NUMBER: 953525565 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-13941 FILM NUMBER: 96686386 BUSINESS ADDRESS: STREET 1: 16215 ALTON PKWY CITY: IRVINE STATE: CA ZIP: 92718 BUSINESS PHONE: 7147274141 8-K 1 FORM 8-K DATED DECEMBER 26, 1996 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of Earliest Event Reported) DECEMBER 26, 1996 (DECEMBER 13,1996) AST RESEARCH, INC. (Exact name of registrant as specified in its charter) DELAWARE (State or other jurisdiction of incorporation) 0-13941 95-3525565 (Commission File Number)(IRS Employer Identification No.) 16215 ALTON PARKWAY IRVINE, CALIFORNIA 92718 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (714) 727-4141 NOT APPLICABLE (Former name or former address, if changed since last report.) ITEM 5. OTHER EVENTS On December 13, 1996, AST Research, Inc. (the "Company") signed a Second Additional Support Agreement with Samsung Electronics Co. Ltd. ("Samsung") to provide certain additional financial support to the Company as consideration for shares of non-voting preferred stock. The additional financial support includes a guaranty of a $100 million bank line of credit starting December 13, 1996, and a guaranty of an additional $100 million bank line of credit starting April 1, 1997, both extending through December 31, 1998. The additional financial support is in addition to the existing Samsung guaranty of a $200 million credit facility, provided pursuant to an Additional Support Agreement between the Company and Samsung, dated December 21, 1995. The Second Additional Support Agreement also includes a one-year extension of the guaranty provided under the Additional Support Agreement, which results in all guarantees expiring on December 31, 1998. As consideration for the support, the Company issued Samsung 500,000 shares of non-voting preferred stock. The shares are not subject of mandatory redemption, but each share is redeemable at the Company's option for cash of $100.75 or 13.11 shares of the Company's common stock, beginning in 1999. The preferred shares carry a quarterly cumulative dividend, beginning in 1999, at the annual rate of $4.72 per share, with annual increases to the rate of $7.96 per share in the year 2004 and thereafter. On December 18, 1996 the Company completed the establishment of bank credit lines totaling $100 million with three banks, which represents the initial $100 million bank credit line that is guaranteed by the Second Additional Support Agreement. In addition, on December 24, 1996, the Company announced that it renewed its present $200 million credit line with a consortium of nine banks. The result is current credit facilities that provide, in the aggregate, $300 million in credit to the Company that is guaranteed by Samsung. The Company further announced that Samsung has exercised its option to purchase a first group of intellectual properties pursuant to the Intellectual Property Assignment Agreement dated June 27, 1996 for a payment of $10 million. The payment is due from Samsung to the Company 45 days from the effective date of the agreement, which is December 17, 1996. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS Exhibit Number Description 99.1 Press release issued by the Registrant on December 16, 1996, announcing the Second Additional Support Agreement, extension of the Additional Support Agreement, and the negotiation of a $100 million line of credit that is part of the Second Additional Support Agreement. 99.2 Second Additional Support Agreement between AST Research Inc., and Samsung Electronics Co., Ltd. dated December 13, 1996. 99.3 Revolving line of credit agreement dated December 12, 1996 between AST Research and ABN AMRO Bank, N.V. 99.4 Revolving line of credit agreement dated December 13, 1996 between AST Research and Bank of America NT&SA. 99.5 Revolving line of credit agreement dated December 13, 1996 between AST Research and Societe General. 99.6 Second Amendment to Credit Agreement dated December 13, 1996 among AST Research, Inc., Bank of America NT & SA as agent and the other financial institutions party hereto. 99.7 Press release issued by the Registrant on December 19, 1996, announcing the renewal of the Company's existing $200 million credit line and Samsung's exercise of its option to purchase intellectual properties. 99.8 First Intellectual Property Option Exercise dated December 17, 1996 between AST Research and Samsung Electronics Company Limited. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AST Research, Inc. _______________________________________ (Registrant) By Won S. Yang Senior Vice President and Chief Financial Officer (Acting) Date: December 26, 1996 ITEM 5. OTHER EVENTS On December 13, 1996, AST Research, Inc. (the "Company") signed a Second Additional Support Agreement with Samsung Electronics Co. Ltd. ("Samsung") to provide certain additional financial support to the Company as consideration for shares of non-voting preferred stock. The additional financial support includes a guaranty of a $100 million bank line of credit starting December 13, 1996, and a guaranty of an additional $100 million bank line of credit starting April 1, 1997, both extending through December 31, 1998. The additional financial support is in addition to the existing Samsung guaranty of a $200 million credit facility, provided pursuant to an Additional Support Agreement between the Company and Samsung, dated December 21, 1995. The Second Additional Support Agreement also includes a one-year extension of the guaranty provided under the Additional Support Agreement, which results in all guarantees expiring on December 31, 1998. As consideration for the support, the Company issued Samsung 500,000 shares of non-voting preferred stock. The shares are not subject of mandatory redemption, but each share is redeemable at the Company's option for cash of $100.75 or 13.11 shares of the Company's common stock, beginning in 1999. The preferred shares carry a quarterly cumulative dividend, beginning in 1999, at the annual rate of $4.72 per share, with annual increases to the rate of $7.96 per share in the year 2004 and thereafter. On December 18, 1996 the Company completed the establishment of bank credit lines totaling $100 million with three banks, which represents the initial $100 million bank credit line that is guaranteed by the Second Additional Support Agreement. In addition, on December 24, 1996, the Company announced that it renewed its present $200 million credit line with a consortium of nine banks. The result is current credit facilities that provide, in the aggregate, $300 million in credit to the Company that is guaranteed by Samsung. The Company further announced that Samsung has exercised its option to purchase a first group of intellectual properties pursuant to the Intellectual Property Assignment Agreement dated June 27, 1996 for a payment of $10 million. The payment is due from Samsung to the Company 45 days from the effective date of the agreement, which is December 17, 1996. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS Exhibit Number Description 99.1 Press release issued by the Registrant on December 16, 1996, announcing the Second Additional Support Agreement, extension of the Additional Support Agreement, and the negotiation of a $100 million line of credit that is part of the Second Additional Support Agreement. 99.2 Second Additional Support Agreement between AST Research Inc., and Samsung Electronics Co., Ltd. dated December 13, 1996. 99.3 Revolving line of credit agreement dated December 12, 1996 between AST Research and ABN AMRO Bank, N.V. 99.4 Revolving line of credit agreement dated December 13, 1996 between AST Research and Bank of America NT&SA. 99.5 Revolving line of credit agreement dated December 13, 1996 between AST Research and Societe General. 99.6 Second Amendment to Credit Agreement dated December 13, 1996 among AST Research, Inc., Bank of America NT & SA as agent and the other financial institutions party hereto. 99.7 Press release issued by the Registrant on December 19, 1996, announcing the renewal of the Company's existing $200 million credit line and Samsung's exercise of its option to purchase intellectual properties. 99.8 First Intellectual Property Option Exercise dated December 17, 1996 between AST Research and Samsung Electronics Company Limited. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AST Research, Inc. _______________________________________ (Registrant) By /s/ WON S. YANG Won S. Yang Senior Vice President and Chief Financial Officer (Acting) Date: December 26, 1996 EX-99.1 2 FOR IMMEDIATE RELEASE Media & Analyst Contact: Emory Epperson (714) 727-7958 AST STRENGTHENS SAMSUNG RELATIONSHIP WITH NEW $200 MILLION CREDIT GUARANTEE AGREEMENT AND EXTENDS PREVIOUS $200 MILLION CREDIT GUARANTEE AGREEMENT IRVINE, Calif., Dec. 16, 1996 -- AST Research Inc. (ASTA-NASDAQ) today announced it has finalized the previously announced new $200 million, two-year bank credit guarantee agreement with Samsung Electronics. The company also announced for the first time that it has received a one-year extension of a previous $200 million bank credit guarantee agreement provided by Samsung, which extends it from Dec. 31, 1997 through Dec. 31, 1998. The result is that Samsung is providing guarantees for a total of $300 million in bank credit for AST effective Dec. 13, 1996, increasing to $400 million on April 1, 1997 and continuing at the full $400 million level through Dec. 31, 1998. In consideration for the support agreement, AST has granted Samsung 500,000 shares of non-voting preferred stock. The AST preferred stock is redeemable beginning in 1999, at AST's option, for AST common stock or cash. Each share of AST preferred stock may then be redeemed by AST for approximately 13 shares of AST common stock or $100.75. AST further announced that it is in the process of renewing its present $200 million credit line with a consortium of nine banks, led by Bank of America, with such credit line extending through late December 1997. In addition, AST has negotiated or is in the process of negotiating separate additional credit lines in the aggregate amount of $100 million from Bank of America, ABN Amro N.V. and Societe Generale, effective in December 1996. The result is current credit facilities providing, in the aggregate, $300 million in credit to AST. Each of the credit lines is guaranteed by Samsung. Funds from the credit lines will be used to repay the previously-announced $50 million short-term loan from Samsung. Samsung's ownership of AST common stock remains unchanged at approximately 46 percent. Samsung also holds a five-year option to purchase up to 4.4 million shares of AST common stock at one-cent per share. If the option is exercised in full, Samsung's ownership position would increase to approximately 49.6 percent. AST Research Inc., a member of the Fortune 500 list of America's largest industrial and service companies, is one of the world's leading personal computer manufacturers. The company develops a broad spectrum of desktop, mobile and server PC products that are sold in more than 100 countries worldwide. AST systems meet a wide range of customer needs, ranging from corporate business applications to advanced home and home office use. Corporate headquarters is located at 16215 Alton Parkway, P.O. Box 57005, Irvine, Calif. 92619-7005. Telephone (714) 727-4141 or (800) 876-4278. Fax: (714) 727-9355. Information about AST and its products can be found on the World Wide Web at http://www.ast.com. # # # EX-99.2 3 SECOND ADDITIONAL SUPPORT AGREEMENT This Second Additional Support Agreement (the "Agreement") is entered into as of December 13, 1996 by and between Samsung Electronics Co., Ltd., a Korean corporation ("SEC"), and AST Research, Inc., a Delaware corporation ("AST"). Capitalized terms used in this Agreement and not otherwise defined herein shall have the meanings ascribed to them in the Stock Purchase Agreement referred to in recital A immediately below. A. SEC and AST entered into that certain Stock Purchase Agreement dated as of February 27, 1995, as amended by Amendment No. 1 thereto dated as of June 1, 1995 and Amendment No. 2 thereto dated as of July 29, 1995 (as so amended, the "Stock Purchase Agreement") pursuant to which SEC acquired certain shares of AST's Common Stock and became a significant stockholder of AST. B. SEC and AST entered into that certain Additional Support Agreement dated as of December 21, 1995 pursuant to which SEC extended certain vendor credit to AST and guaranteed bank credit lines for the benefit of AST in the amount of $200 million (the "First Guaranties"). E. AST has requested additional support from SEC to further enhance its business prospects and competitive position and SEC desires to provide such support in consideration of the issuance of the Preferred Stock to SEC as herein provided. NOW, THEREFORE, in consideration of the foregoing premises and the representations, warranties, and covenants set forth in this Agreement, SEC and AST hereby agree as follows: ARTICLE 1 ADDITIONAL GUARANTY 1.1 Additional Guaranty. In addition to the amounts guarantied by the First Guaranties, SEC shall, as promptly as practicable after receipt of a request from AST, execute and deliver one or more guaranties (the "Additional Guaranty") of a line or lines of credit from one or more banks or other financial institutions for the benefit of AST in an aggregate amount not to exceed $200 million outstanding at any one time; provided, however, that the obligation to provide such Additional Guaranty shall not extend beyond December 31, 1998, and provided further that the terms of such Additional Guaranty shall not differ materially from the terms of the First Guaranties or other forms of guaranties previously submitted to SEC by AST. 1.2 Extension of First Guaranties. Article 2.1 of the Additional Support Agreement stating that the Guaranty provided therein shall not extend beyond December 31, 1997 is hereby amended to instead state that the Guaranty provided therein shall not extend beyond December 31, 1998. SEC hereby consents to the extension until not later than December 31, 1998 of the indebtedness guaranteed by the First Guaranties, and SEC shall execute and deliver such consents, acknowledgments or other documents as the beneficiaries of the First Guaranties shall reasonably request to confirm SEC's consent to such extension. ARTICLE 2 PREFERRED STOCK 2.1 Issuance. Concurrently with delivery by SEC of the first Additional Guaranty requested by AST, and as a condition to SEC's obligation to execute and deliver such Additional Guaranty, AST shall issue to SEC 500,000 shares of Series A Redeemable Preferred Stock (the "Preferred Stock"), having the rights, powers, preferences and privileges set forth on Exhibit A attached hereto. 2.2 Conditions to Delivery of Preferred Stock. The obligation of AST to issue and deliver the Preferred Stock to SEC is subject to the following conditions: (a) Such delivery would not in any material respect violate, or otherwise cause the material violation of, any law or regulation (including any rules or regulations of the NASDAQ National Market or any other principal stock exchange on which the Common Stock of AST is at the time listed or quoted) applicable to the issuance and delivery of the Preferred Stock; and (b) There shall be no preliminary or permanent injunction or other order by any court of competent jurisdiction preventing or prohibiting such issuance and delivery of the Preferred Stock. 2.3 Investment Intent. SEC represents and warrants to AST that the Preferred Stock will be acquired by SEC solely for its own account, for investment purposes only, and with no present intention of distributing, selling or otherwise disposing of such Preferred Stock. SEC understands that the Preferred Stock will not have been registered under the Securities Act and that any disposition thereof by SEC must be registered under the Securities Act or exempt from such registration. 2.4 Sophistication. SEC represents and warrants to AST that SEC is able to bear the economic risk of an investment in the Preferred Stock and can afford to sustain a total loss on such investment, and has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the proposed investment and therefore has the capacity to protect its own interests in connection with the purchase of the Preferred Stock. 2.5 No Transfer. SEC shall not sell or otherwise transfer any shares of the Preferred Stock except to an Affiliate of SEC which is bound by the provisions of the Stockholder Agreement dated July 31, 1995, as subsequently amended, between AST and SEC. ARTICLE 3 COMPLIANCE WITH LAW 3.1 Consents. Each of the parties represents on its own behalf to the other party that it has obtained all consents required of it under applicable laws, rules or regulations (including, in the case of SEC, those of Korea) for the execution, delivery and performance of its obligations under this Agreement, that such execution, delivery and performance does not violate such laws, rules or regulations and that this Agreement is legal, valid and binding on such party in accordance with its terms. ARTICLE 4 MISCELLANEOUS 4.1 Governing Law; Consent to Jurisdiction. This Agreement shall be governed by, construed under and enforced in accordance with, the laws of the State of Delaware without regard to its conflict-of-laws principles. SEC and AST agree that (i) any legal action or proceeding arising out of or in connection with this Agreement or the transactions contemplated hereby shall be brought exclusively in the courts of the State of Delaware or the Federal courts of the United States of America sitting in Delaware, (ii) each irrevocably submits to the jurisdiction of each such court, and (iii) any summons, pleading, judgment, memorandum of law, or other paper relevant to any such action or proceeding shall be sufficiently served if delivered to the recipient thereof by certified or registered mail (with return receipt) at its address set forth in Section 4.3. Nothing in the proceeding sentence shall affect the right of any party to proceed in any jurisdiction for the enforcement or execution of any judgment, decree or order made by a court specified in said sentence. 4.2 Expenses. Each of the parties shall pay its own expenses incurred in connection with the negotiation and preparation of this Agreement and the effectuation of the transactions contemplated hereby including, without limitation, all fees and disbursements of its respective legal counsel, advisors, and accountants. 4.3 Notices. In case of any event or circumstance giving rise to an obligation of SEC or AST to provide notice hereunder, such notice shall be delivered within the time specifically set forth herein or, if no such time is specified, then as promptly as practicable after becoming aware of such event or circumstance. Any notice required or permitted to be given under this Agreement shall be written, and may be given by personal delivery, by cable, telecopy, telex or telegram (with a confirmation copy mailed as follows), by Federal Express, United Parcel Service, DHL, or other reputable commercial delivery service, or by registered or certified mail, first-class postage prepaid, return receipt requested. Notice shall be deemed given upon actual receipt. Mailed notices shall be addressed as follows, but each party may change address by written notice in accordance with this paragraph. To AST: AST Research, Inc. 16215 Alton Parkway Irvine, California 92718 Attention: Chief Executive Officer with a copy to: Skadden, Arps, Slate, Meagher & Flom 300 South Grand Avenue Los Angeles, CA 90071-3144 Attention: Thomas C. Janson, Jr., Esq. To SEC: Samsung Electronics Co., Ltd. Samsung Main Building 250, 2-Ka, Taepyung-Ro, Chung-Ku Seoul, Korea 100-742 Attention: General Legal Counsel with a copy to: Gibson, Dunn & Crutcher 4 Park Plaza, Suite 1700 Irvine, CA 92714 Attention: Thomas D. Magill, Esq. 4.4 Waiver. Each party hereto may in its sole discretion (i) extend the time for the performance of any of the obligations or other acts of the other party hereunder, (ii) waive any inaccuracies in the representations and warranties of the other party contained herein or in any document, certificate or writing delivered pursuant hereto or (iii) waive compliance by the other party with any of the agreements or conditions contained herein. No term or provision hereof shall be deemed waived and no breach hereof excused unless such waiver or consent shall be in writing and signed by the party claimed to have waived or consented. No waiver hereunder shall apply or be construed to apply beyond its expressly stated terms. No failure to exercise and no delay in exercising any right, remedy, power or privilege hereunder shall operate as a waiver thereof, and no single or partial exercise of any right, remedy, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. No failure to insist upon strict performance of any term or provision of this Agreement, or to exercise any right hereunder, shall be construed as a waiver or as a relinquishment of such term, provision, or right. 4.5 SEC Subsidiaries; Successors, Assignment, and Parties in Interest. This Agreement and the rights hereunder may not be assigned by SEC or AST without the prior written consent of the other party, which may be given or withheld in the other party's discretion, except that SEC may (i) exercise any or all rights and/or fulfill any or all obligations under this Agreement in conjunction with or through one or more wholly owned subsidiaries of SEC; and/or (ii) assign this Agreement to an Affiliate or Affiliates of SEC; provided that SEC shall remain liable for all of its obligations under this Agreement not fully performed by its subsidiaries or assignees. This Agreement shall be binding upon and inure solely to the benefit of SEC and AST and their respective successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any rights, benefits or remedies of any nature whatsoever under or by reason of this Agreement. 4.6 Entire Agreement. This Agreement constitutes the entire agreement between SEC and AST with respect to the subject matter hereof and the transactions contemplated hereby and supersedes all prior or contemporaneous, written or oral agreements or understandings with respect thereto (including without limitation all term sheets). The parties acknowledge that their agreements hereunder were not procured through representations or agreements not set forth herein or therein. 4.7 Amendment. This Agreement may be amended only by a written instrument executed and delivered by a duly authorized officer of SEC and a duly authorized officer of AST. 4.8 Cumulation of Remedies. All remedies available to any party for breach or non-performance of this Agreement are cumulative and not exclusive of any rights, remedies, powers or privileges provided by law, and may be exercised concurrently or separately, and the exercise of any one remedy shall not be deemed an election of such remedy to the exclusion of other remedies. 4.9 Fair Construction. This Agreement shall be deemed the joint work product of SEC and AST without regard to the identity of the draftsperson, and any rule of construction that a document shall be interpreted or construed against the drafting party shall not be applicable. 4.10 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first above written. AST RESEARCH, INC., SAMSUNG ELECTRONICS CO., LTD., a Delaware corporation a Korean corporation By: /s/ RANDALL G. WICK By: /s/ HYEON GON KIM Name: Randall G. Wick Name: Hyeon Gon Kim Title: Assistant Secretary Title: Executive Vice President CERTIFICATE OF DESIGNATIONS OF THE SERIES A REDEEMABLE PREFERRED STOCK (PAR VALUE $.01 PER SHARE) OF AST RESEARCH, INC. ______________ PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE ______________ The undersigned DOES HEREBY CERTIFY that the following resolution was duly adopted by the Board of Directors of AST Research, Inc., a Delaware Corporation (the "CORPORATION"), at a meeting duly convened and held on December 12, 1996, at which a quorum was present and acting throughout: RESOLVED, that pursuant to the authority expressly granted to and vested in the Board of Directors of the Corporation (the "BOARD OF DIRECTORS") by Article 4(b) of the Restated Certificate of Incorporation of the Corporation dated July 31, 1995 (the "CERTIFICATE OF INCORPORATION"), the Board of Directors hereby authorizes and approves the creation and issuance of a new series of Preferred Stock of the Corporation upon the terms and conditions set forth in these resolutions, which fix the powers, preferences and relative, participating, optional or other special rights, and the qualifications, limitations and restrictions of the shares of such new series, in addition to those set forth in the Certificate of Incorporation, as follows: 1. SERIES A PREFERRED STOCK. The new series of Preferred Stock of the Corporation authorized hereby shall be designated the Series A Redeemable Preferred Stock (the "SERIES A PREFERRED STOCK"), and shall consist of Five Hundred Thousand (500,000) shares, par value $.01 per share; provided, however, that the Board of Directors, or, to the extent permitted by applicable law, a duly authorized committee thereof, may decrease (but not increase) the number of authorized shares in such series subsequent to the date of original issuance of shares in such series (the "ORIGINAL ISSUANCE DATE"), but not below the number of shares of such series then outstanding. The Series A Preferred Stock is issuable solely in whole shares that shall entitle the holder thereof to exercise the voting rights, to participate in the distributions and to have the benefit of all other rights of holders of Series A Preferred Stock as set forth herein and in the Certificate of Incorporation. For purposes of this Certificate of Designations, the terms "PREFERRED STOCK" and "COMMON STOCK" shall have the meanings ascribed to them in the Certificate of Incorporation in effect as of the Original Issuance Date. 2. DIVIDENDS. (A) PAYMENT OF DIVIDENDS. No dividends or other distributions shall accrue or be payable on or in respect of the Series A Preferred Stock prior to January 1, 1999 (the "COMMENCEMENT DATE"). Dividends shall commence accruing on the Series A Preferred Stock on the Commencement Date, and unless and until all of the Series A Preferred Stock has been exchanged or redeemed by the Corporation pursuant to Section 5 or Section 6, the holders of Series A Preferred Stock shall be entitled to receive cash dividends, out of any funds legally available therefor, prior and in preference to any declaration or payment of any dividend (other than a dividend payable in Common Stock of the Corporation) on the Common Stock and to any declaration or payment of any dividend on any other series of Preferred Stock of the Corporation ranking, as to dividends and distributions, junior to the Series A Preferred Stock (other than dividends payable in Common Stock or Preferred Stock ranking, as to dividends and distributions, junior to the Series A Preferred Stock), at the respective annual rates per share of Series A Preferred Stock set forth below (as adjusted for any stock dividends, combinations or splits with respect to such shares), payable quarterly on the last day of March, June, September, and December each year commencing on March 31, 1999: Calendar Year Annual Dividend 1999 $4.72 2000 5.36 2001 6.00 2002 6.64 2003 7.32 2004 7.96 and thereafter Such dividends shall accrue on each share and accrue from day to day, whether or not earned or declared, and shall be cumulative so that if such dividends with respect to any previous quarterly dividend period at said rate per share per annum shall not have been paid on or declared and set apart for all shares of Series A Preferred Stock at the time outstanding, the deficiency shall be fully paid on or declared and set apart for such shares before the Corporation makes any distribution (as such term is hereinafter defined) to the holders of Common Stock or any other series of Preferred Stock ranking, as to dividends and distributions, junior to the Series A Preferred Stock. The term "DISTRIBUTION" as used in this Section 2(a) shall mean the transfer of cash or property without consideration, whether by way of dividend or otherwise (except a dividend in shares of the Corporation that are junior to the Series A Preferred Stock as to dividends and distributions and except as contemplated by this Certificate of Designations) to the holders of shares of capital stock of the Corporation, in such holders' capacity as such, or the purchase or redemption of shares of the Corporation for cash or property (except for the repurchase of Common Stock from employees, directors, consultants and advisers pursuant to the terms of stock purchase agreements under which such shares are issued), including any such transfer, purchase or redemption by a subsidiary of the Corporation. The time of any distribution by way of dividend shall be the date of declaration thereof and the time of any distribution by purchase or redemption of shares shall be the day cash or property is transferred by the Corporation, whether or not pursuant to a contract of an earlier date; provided that, where a negotiable debt security is issued in exchange for shares, the time of the distribution is the date when the Corporation acquires the shares in such exchange. (B) PRIORITY AS TO DIVIDENDS. No dividends shall be declared or paid or set apart for payment on Common Stock or on Preferred Stock of any series ranking, as to dividends and distributions, junior to the Series A Preferred Stock, unless at the time of such declaration or payment or setting apart for payment all dividends to which holders of Series A Preferred Stock are entitled pursuant to Section 2(a) have been or contemporaneously are declared and paid (or declared and a sum sufficient for the payment thereof set apart for such payment). 3. LIQUIDATION PREFERENCE. (A) SERIES A LIQUIDATION PREFERENCE. In the event of any Liquidation Event (as defined below), either voluntary or involuntary, the holders of Series A Preferred Stock shall be entitled to receive by reason of their ownership thereof, prior and in preference to any distribution of any of the assets of the Corporation to the holders of Common Stock, or to any other series of Preferred Stock that may be issued by the Corporation from time to time ranking, as to liquidation, junior to the Series A Preferred Stock, an amount per share in cash equal to the sum of (i) $65.00 for each outstanding share of Series A Preferred Stock, as adjusted for any stock dividends, combinations or splits with respect to such share plus (ii) an amount equal to all accrued but unpaid dividends (whether or not declared) on each such share (the "Liquidation Preference"). (B) INSUFFICIENT FUNDS. If, in connection with any Liquidation Event, the Corporation's cash funds legally available for distribution to the holders of the Series A Preferred Stock and any shares of the Corporation's Preferred Stock ranking on a parity with the Series A Preferred Stock as to liquidation are not sufficient to pay the full Series A Preferred Stock liquidation preference in cash, then any deficiency in the cash payment of the Series A Preferred Stock liquidation preference may be paid in non-cash assets of the Corporation legally available for distribution to the holders of Series A Preferred Stock. If the cash and non-cash assets legally available for distribution to the holders of the Series A Preferred Stock shall be insufficient to permit the full payment to such holders of the full Series A Preferred Stock liquidation preference, then any cash and non-cash assets of the Corporation legally available for distribution shall be distributed ratably among the holders of the Series A Preferred Stock in proportion to the number of such shares owned by each such holder. In connection with the distribution of any non-cash assets in payment of the Series A Preferred Stock liquidation preference, the non-cash assets will be valued at their fair market value, as determined by independent appraisal by an appraiser selected in good faith by the Board of Directors. (C) LIQUIDATION EVENT. For purposes of Section 3, a "LIQUIDATION EVENT" shall mean any liquidation, dissolution, or winding up of the Corporation. Neither a consolidation or merger of the Corporation with or into another Corporation, nor a merger of any other Corporation with or into the Corporation, nor the sale of all or substantially all of the Corporation's property or business (other than in connection with a winding up of its business) will be considered a Liquidation Event for purposes of this Certificate of Designations. 4. NO VOTING RIGHTS. The holders of Series A Preferred Stock will not have any voting rights except such rights as from time to time are required by the Delaware General Corporation Law. Any shares of Series A Preferred Stock held by the Corporation or any subsidiary of the Corporation shall not have voting rights hereunder and shall not be counted in determining the presence of a quorum or in calculating any percentage of shares under this Section 4. 5. EXCHANGE BY CORPORATION. (A) EXCHANGE RATIO AND DIVIDENDS. At any time, and from time to time, on or after the Commencement Date, the Corporation may, at the sole option of the Independent Directors (as defined in Section 5(f)), exchange (an "EXCHANGE"), in whole or in part, each share of the Series A Preferred Stock for thirteen and eleven hundredths (13.11) fully paid and nonassessable shares of the Corporation's Common Stock (the "EXCHANGE RATIO"). At the time of any Exchange, the Corporation shall pay in cash all accrued but unpaid dividends (whether or not declared) on such exchanged shares to and as of the Exchange Date (as defined in Section 5(c)) to the exchanging holders thereof. (B) PRO RATA EXCHANGE. In the event of any Exchange of only a part of the then outstanding Series A Preferred Stock, the Corporation shall effect such Exchange pro rata among the outstanding shares of Series A Preferred Stock according to the number of shares then held by each holder thereof. (C) MECHANICS OF EXCHANGE. In the event of any Exchange pursuant to this Section 5, at least twenty (20) but no more than sixty (60) days prior to the date fixed by the Independent Directors (an "EXCHANGE DATE"), written notice shall be mailed, first class postage prepaid, to each holder of record (at the close of business on the business day next preceding the day on which notice is mailed) of the Series A Preferred Stock to be exchanged, at the address last shown on the records of the Corporation for such holder or given in writing by the holder to the Corporation for the purpose of notice, notifying such holder of the Exchange to be effected, specifying the number of shares of Series A Preferred Stock to be exchanged by such holder, the Exchange Date, the number of shares of Common Stock to be received by the holder in such Exchange, the amount of cash for any fractional share and for all accrued but unpaid dividends to be paid to the holder, and calling upon such holder to surrender to the Corporation at its principal executive office or the office of its transfer agent, such holder's certificate or certificates representing the shares of Series A Preferred Stock to be exchanged (the "EXCHANGE NOTICE"). On or after the Exchange Date, each holder of Series A Preferred Stock to be exchanged shall surrender to the Corporation the certificate or certificates representing such shares, in the manner and at the place designated in the Exchange Notice, and each surrendered certificate shall be canceled. In the event less than all the shares represented by any such Series A Preferred Stock certificate are exchanged, a new certificate shall be issued representing the unexchanged shares. The Corporation shall, as soon as practicable after each Exchange, issue and deliver to the exchanging holder of Series A Preferred Stock or to the nominee or nominees of such holder, a certificate or certificates for the number of shares of Common Stock to which such holder shall be entitled as aforesaid. Such exchange shall be deemed to have been made immediately upon the opening of business on the Exchange Date, and the person or persons entitled to receive the shares of Common Stock issuable upon such exchange shall be treated for all purposes as the record holder or holders of such shares of Common Stock immediately upon the opening of business on such Exchange Date. From and after the opening of business on the Exchange Date, unless there shall have been a failure by the Corporation to effectuate an Exchange, all rights of the holders of such exchanged shares as holders of Series A Preferred Stock (except the right to receive the appropriate number of shares of Common Stock and cash for any fractional share and for accrued but unpaid dividends in exchange for the surrender of their certificate or certificates), shall cease with respect to such shares of Series A Preferred Stock, and such shares shall not thereafter be transferred on the books of the Corporation or be deemed to be outstanding for any purposes whatsoever. (D) NO FRACTIONAL SHARES. No fractional share of Common Stock shall be issued upon any Exchange of Series A Preferred Stock pursuant to the provisions of this Section 5. In lieu of any fractional share to which a holder of Series A Preferred Stock would otherwise be entitled, the Corporation shall pay in cash the Fair Market Value (as defined below) of any such fractional share of Common Stock. The "FAIR MARKET VALUE" of a fraction of a share of Common Stock shall be an amount equal to the same fraction of the closing price of the Common Stock on the last trading day prior to the Exchange Date on the National Market System of the National Association of Securities Dealers, Inc. Automated Quotation System (the "NMS"), or such other national securities exchange or quotation system as such Common Stock is then listed or, if not so listed or quoted, the average of the closing bid and asked prices on such trading date. The determination of the fractional share for which a cash payment will be made shall be determined on the basis of the total number of shares of the Series A Preferred Stock the holder is at the time required to exchange into Common Stock and the number of shares of Common Stock issuable upon such aggregate Exchange. (E) TRANSFER TAXES. The Corporation shall pay any and all United States issue or other taxes that may be payable in respect of any issue or delivery of shares of Common Stock upon exchange of the Series A Preferred Stock. The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue or delivery of Common Stock (or other securities or assets) in a name other than that in which the shares of Series A Preferred Stock so exchanged were registered, and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Corporation the amount of such tax or has established, to the satisfaction of the Corporation, that such tax has been paid. (F) INDEPENDENT DIRECTOR. For purposes of this Certificate of Designations, "INDEPENDENT DIRECTOR" means each director of the Corporation who is not currently (i) a holder of Series A Preferred Stock nor (ii) apart from such directorship, an affiliate, officer, director, employee, agent, principal stockholder, consultant or partner of any holder of Series A Preferred Stock or the Corporation or any affiliate of either of them or of any entity that was dependent on a holder of Series A Preferred Stock or the Corporation or any affiliate of either of them for more than five percent (5%) of its revenues or earnings in its most recent fiscal year, and who was not at any time in the past an affiliate, officer, employee, director, principal stockholder or partner of a holder of Series A Preferred Stock or the Corporation or any affiliate of either of them, and does not have, in the good faith judgment of the then existing Independent Directors, any other direct or indirect interest in or relationship with a holder of Series A Preferred Stock or the Corporation or any of their respective affiliates so as to be reasonably likely to cause such person to have any interest in any transaction with a holder of Series A Preferred Stock or the Corporation or any of their respective affiliates. (G) EXCHANGE RATIO AND SHARE ADJUSTMENTS. (I) SUBDIVISION, COMBINATION OR RECLASSIFICATION. In the event that the Corporation at any time or from time to time after the Original Issuance Date shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock or in any right to acquire Common Stock for no consideration, or shall effect a subdivision of the outstanding Common Stock into a greater number of shares of Common Stock (by stock split, reclassification or otherwise than by payment of a dividend in Common Stock or in any right to acquire Common Stock), or in the event the outstanding shares of Common Stock shall be combined or consolidated, by reclassification, reverse stock split or otherwise, into a lesser number of shares of Common Stock, then the Exchange Ratio in effect immediately prior to such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate. In the event that the Corporation shall declare or pay, without consideration, any dividend on the Common Stock payable in any right to acquire Common Stock for no consideration, then the Corporation shall be deemed to have made a dividend payable in Common Stock in an amount of shares equal to the maximum number of shares issuable upon exercise of such rights to acquire Common Stock. (II) NO MINOR ADJUSTMENTS TO EXCHANGE RATIO. No adjustment of the Exchange Ratio shall be made pursuant to this Section 5(g) in an amount less than one hundredth (0.01) of a share. Adjustment amounts under one hundredth (0.01) of a share shall be carried forward and taken into account in any subsequent adjustment calculations. (III) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each adjustment or readjustment of the Exchange Ratio pursuant to this Section 5(g), the Corporation, at its expense, shall within a reasonable time compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series A Preferred Stock a certificate setting forth (A) such adjustment or readjustment showing in detail the facts upon which such adjustment or readjustment is based, (B) the Exchange Ratio at the time in effect, and (C) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the exchange of a share of Series A Preferred Stock. (H) DISTRIBUTIONS. In the event the Corporation shall declare a distribution payable in securities of other persons, in evidences of indebtedness issued by the Corporation or other persons or in assets (excluding cash dividends) or in rights not referred to in Section 5(g)(i), then, in each such case for the purpose of this Section 5(h), the holders of Series A Preferred Stock shall be entitled to a proportionate share of any such distribution as though they were the holders of the number of shares of Common Stock of the Corporation into which their shares of Series A Preferred Stock are exchangeable pursuant to Section 5 as of the record date fixed for the determination of the holders of Common Stock of the Corporation entitled to receive such a distribution. (I) RECAPITALIZATIONS. If at any time or from time to time there shall be a recapitalization of the Common Stock (other than a subdivision, combination or reclassification as set forth in Section 5(g)(i)), provision shall be made so that the holders of Series A Preferred Stock shall thereafter be entitled to receive, upon exchange of their Series A Preferred Stock, the number of shares of stock or other securities or property of the Corporation, or otherwise, to which a holder of Series A Preferred Stock would have been entitled in such recapitalization if such holder's shares had been exchanged into Common Stock immediately prior to such recapitalization. In any such case, appropriate adjustment shall be made in the application of the provisions of this Section 5 with respect to the rights of the holders of Series A Preferred Stock after the recapitalization to the end that the provisions of this Section 5 (including adjustment of the Exchange Ratio, if applicable, then in effect and the number of shares receivable upon exchange of Series A Preferred Stock) shall be applicable after that event as nearly equivalent as may be practicable. 6. REDEMPTION BY CORPORATION. At any time, and from time to time, on or after the Commencement Date, the Corporation may, at the option of the Independent Directors, redeem for cash, in whole or in part, the Series A Preferred Stock (a "REDEMPTION"), as follows: (A) REDEMPTION PRICE. The redemption price per share for the Series A Preferred Stock shall be one hundred dollars and seventy five cents ($100.75) (the "REDEMPTION PRICE"). At the time of any Redemption, the Corporation shall pay in cash all accrued but unpaid dividends (whether or not declared) on such redeemed shares to and as of the Redemption Date (as defined in Section 6(c)) to the redeeming holders thereof. (B) PRO RATA REDEMPTION. In the event of any Redemption of only a part of the then outstanding Series A Preferred Stock, the Corporation shall effect such Redemption pro rata among the outstanding shares of Series A Preferred Stock according to the number of shares then held by each holder thereof. (C) MECHANICS OF REDEMPTION. In the event of any Redemption pursuant to this Section 6, at least twenty (20) but no more than sixty (60) days prior to the date fixed by the Independent Directors for such Redemption of Series A Preferred Stock (a "REDEMPTION DATE"), written notice shall be mailed, first class postage prepaid, to each holder of record (at the close of business on the business day next preceding the day on which notice is mailed) of the Series A Preferred Stock to be redeemed, at the address last shown on the records of the Corporation for such holder or given in writing by the holder to the Corporation for the purpose of notice, notifying such holder of the Redemption to be effected, specifying the number of shares of Series A Preferred Stock to be redeemed, the Redemption Date, the Redemption Price, and calling upon such holder to surrender to the Corporation at its principal executive office or the office of its transfer agent, such holder's certificate or certificates representing the shares of Series A Preferred Stock to be redeemed (the "REDEMPTION NOTICE"). On or after the Redemption Date, each holder of Series A Preferred Stock to be redeemed shall surrender the certificate or certificates representing such shares, in the manner and at the place designated in the Redemption Notice, and each surrendered certificate shall be canceled. Not less than three (3) days prior to the Redemption Date, the Corporation shall deposit, from funds legally available therefor, the Redemption Price for the shares designated for redemption with a bank or trust Corporation having aggregate capital and surplus in excess of $20,000,000 as a trust fund for the benefit of the holder of the shares designated for Redemption. At such time, the Corporation shall also deposit irrevocable instruction and authority to such bank or trust Corporation to pay, on or after the Redemption Date, the deposited Redemption Price of the Series A Preferred Stock to the holder thereof upon surrender of its certificate(s). If funds are available on the Redemption Date, then whether or not the share certificates are surrendered for payment of the Redemption Price, the shares shall no longer be outstanding and the holder thereof shall cease to be a shareholder of the Corporation with respect to the shares redeemed on and after the Redemption Date and shall be entitled only to receive the Redemption Price without interest upon surrender of the share certificate. If less than all the shares represented by one share certificate are to be redeemed, the Corporation shall issue a new share certificate for the shares not redeemed. 7. NO IMPAIRMENT. The Corporation will not, by amendment of its Certificate of Incorporation or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Corporation, but will at all times in good faith assist in the carrying out of all the provisions of this Certificate of Designations. 8. RESTRICTIONS AND LIMITATIONS. Without the vote or written consent of the holders of at least eighty percent (80%) of the then outstanding shares of Series A Preferred Stock, the Corporation shall not amend its Certificate of Incorporation (including this Certificate of Designations) or its Bylaws if such amendment would adversely affect any of the rights, preferences or privileges provided for therein or herein for the benefit of the shares of Series A Preferred Stock. 9. STATUS OF ACQUIRED STOCK. Shares of Series A Preferred Stock acquired by the Corporation by reason of exchange or otherwise will be restored to the status of authorized but unissued shares of Preferred Stock, without designation as to series, and may be issued, but not as shares of Series A Preferred Stock. 10. NO CONVERSION, EXCHANGE OR REDEMPTION BY HOLDERS. Shares of Series A Preferred Stock shall not be subject to conversion, exchange or redemption at the option of the holder thereof. 11. SEVERABILITY OF PROVISIONS. Whenever possible, each provision hereof shall be interpreted in a manner as to be effective and valid under applicable law, but if any provision hereof is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to he extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions hereof. IN WITNESS WHEREOF, this Certificate of Designations is executed and acknowledged by the undersigned on behalf of the Corporation on this 13th day of December, 1996. AST RESEARCH, INC. By: /s/ RANDALL G.WICK Name: Randall G. Wick Title: Assistant Secretary EX-99.3 4 PROMISSORY NOTE December 12,1996 U.S. $30,000,000 Los Angeles, California For Value Received, AST Research, Inc. (the "Borrower"), a corporation duly organized and validly existing under the laws of Delaware, hereby promises to pay to the order of ABN AMRO Bank, N.V. (the "Bank"), at the office of the Bank located at 500 Park Avenue, New York, New York, 10022 (or at such other place of payment designated by the holder hereof to the Borrower), on Demand, the principal sum of: Thirty Million Dollars($30,000,000) or if less, the unpaid principal amount of all loans (the "Loans") made by the Bank to the Borrower at its request, in lawful money of The United States of America. The Borrower hereby further promises to pay to the order of the Bank, at the place of payment, interest on the unpaid principal amount of all Loans evidenced hereby from the date thereof until the maturity thereof, at either (i)*the Prime Rate (as hereinafter defined) from time to time in effect or (ii)*the rate per annum from time to time offered by the Bank to the Borrower prior to each Loan, such rate to remain fixed for the relevant Interest Period as hereinafter defined. "Interest Period" shall mean successive one-month, two-month, three-month or six-month periods (as selected from time to time by the Borrower by irrevocable notice (in writing or by telephone confirmed via telecopy) given to the Bank not less than three Business Days prior to the first day of each respective Interest Period) commencing on the date of the Loan; provided that: (i) each such one-month, two-month, three-month or six-month period occurring after the initial such period shall commence on the day on which the next preceding period expires; and (ii) if for any reason the Borrower shall fail to timely select a period, then it shall be deemed to have selected a one-month period. Interest shall be payable on the last Business Day of each Interest Period as to offered rate loans, commencing on the first such date to occur after the date hereof, and interest as to Prime Rate loans shall be payable quarterly. Interest as to all loans shall be payable at maturity and after maturity on demand, and on the date of any payment hereon on the amount paid. The Borrower hereby further promises to pay to the order of the Bank, on demand, at the place of payment, interest on the unpaid principal amount hereof after maturity, at the rate per annum equal to the higher (redetermined daily) of (i) one per cent (1%) per annum in excess of the interest rate in effect just prior to maturity, or (ii) the sum of one percent (1%) and the Prime Rate of the Bank from time to time in effect. "Prime Rate" shall mean the rate of interest equal to the higher (redetermined daily) of (i) the per annum rate of interest announced by the Bank from time to time at its principal office in New York City as its prime rate for U.S. dollar loans (with any change in such Prime Rate to become effective as and when such prime rate change shall become effective) or (ii) the per annum rate of interest at which overnight federal funds are from time to time offered to the Bank by any bank in the interbank market plus one half of one per cent (.50%) per annum. Interest will be calculated on the basis of the actual number of days elapsed over a year of 360 days. "Business Day" shall mean any day other than a Saturday, a Sunday and, as to Prime Rate loans, a day on which banks in New York and Los Angeles are required or permitted by law to close and as to offered rate loans, a day on which banks in London, New York and Los*Angeles are required or permitted by law to close. The Bank shall record on its books or records or on the schedule to this Promissory Note which is a part hereof, the interest rate, principal amount and date of each Loan made hereunder, the Interest Period applicable thereto and all payments of principal and interest made thereon; provided that prior to the transfer of this Note all such information shall be recorded on the schedule attached to this Promissory Note. The record thereof, whether shown on such books or records or on the schedule to this Promissory Note, shall be conclusive and binding upon the Borrower, absent manifest error; provided, however, the failure of the Bank to record any of the foregoing shall not limit or otherwise affect the obligation of the Borrower to repay all Loans made hereunder, together with all accrued interest thereon and all other amounts payable hereunder. All payments due hereunder shall be made by the Borrower to the holder hereof no later than 2:30 p.m. local time at the place of payment, in lawful money of the United States of America and in funds immediately available and freely transferable at the place of payment, free and clear of, and without deduction for, any present or future taxes, levies, offsets, counterclaims or deductions of any nature whatsoever ("Deductions"). Payments received after such local time shall be deemed received by the holder hereof on the next succeeding Business Day at such place of payment. In the event that the Borrower is compelled for any reason to make any Deductions, it shall pay to the holder hereof such amounts (after giving effect to all Deductions on all additional payments to be made hereunder) as will result in the receipt by the holder hereof of the amount such holder would have received had no such Deductions been required to be made. If any payment shall fall due hereunder on a day that is not a Business Day for the holder hereof at the place of payment, payment shall be made on the next succeeding Business Day at such place of Payment and interest thereon shall be payable for such extended time, provided, however, that if such succeeding Business Day shall fall into a new calendar month payment shall be made on the Preceding Business Day. The Borrower may prepay any Loan evidenced hereby, without premium or penalty, only on the last Business Day of any Interest Period with respect to such Loan after giving three Business Days' (as to offered rate loans) and 11:00 a.m. Los Angeles time same Business Day (as to Prime Rate loans) prior written notice (which shall be irrevocable) of its determination to repay. Otherwise any Loan evidenced by this Promissory Note may not be prepaid in whole or in part without the prior written consent of the holder hereof. If, for any reason (including by reason of a demand for payment by the Bank or any holder hereof), any Loan evidenced by this Promissory Note is paid prior to the last Business Day of any Interest Period, the Borrower agrees to indemnify the holder hereof against any loss (including any loss on redeployment of the funds repaid or any loss in respect of the breakage of any swap or other hedging or funding arrangement), cost or expense incurred by the holder as a result of such repayment. The Borrower also hereby agrees to indemnify the holder hereof against any loss, cost or expense incurred by such holder as a result of any default or delay by the Borrower in making any payment required hereby, including without limitation, all court cost, reasonable attorney's fees and other costs of collection. No delay on the part of the holder hereof in exercising any of its options, powers or rights, or partial or single exercise thereof shall constitute a waiver thereof. The options, powers and rights of the holder hereof specified herein are in addition to those otherwise created. If any present or future law, treaty, rule or regulation or guideline or in the interpretation thereof by any governmental authority or any central bank or other fiscal, monetary or other authority having jurisdiction over the Bank or its lending office (whether or not having the force of law) shall (a) impose, modify or deem applicable any assessment, reserve, special deposit or similar requirement against assets held by, or deposits in or for the account of or loans by, or any other acquisition of funds or disbursements by, the Bank (b) subject the Bank, the Loan evidenced hereby or this Promissory Note to any tax, duty, charge, stamp tax or fee or change the basis of taxation of payments to the Bank of principal or interest due from the Borrower to the Bank hereunder (other than a change in the taxation of the overall net income of the Bank) or (c) impose on the Bank any other condition regarding the Loans evidenced hereby, this Promissory Note or the Bank's funding thereof and the Bank shall determine (which determination shall be conclusive, absent manifest error) that the result of the foregoing is to increase the cost to the Bank of making or maintaining the Loan evidenced hereby or to reduce the amount of principal or interest received by the Bank hereunder, then the Borrower shall pay to the Bank, on demand, such additional amounts as the Bank shall, from time to time, determine are sufficient to compensate and indemnify it for such increased cost or reduced amount. This Promissory Note shall be governed by and construed in accordance with the laws of the State of Illinois, without giving effect to choice of law or conflicts of laws principles. AST Research, Inc. By /s/ Won S. Yang Its: Senior Vice President, Finance and Acting Chief Financial Officer ABN AMRO Bank N.V. December 10, 1996 GUARANTEE Dear Sirs: In consideration of the granting by you of a Revolving Credit Facility (the "Facility") for USD*30,000,000.00 (US Thirty Million Dollars) to AST Research, Inc., we, Samsung Electronics Co., Ltd., a company incorporated in the Republic of Korea, hereby irrevocably and unconditionally guarantee to you on your first demand, as primary obligor and not merely as surety, the due and punctual payment of all sums due to you under the Facility including, without prejudice to the generality of the foregoing, principal, interest (including interest on overdue amounts) and costs (the "Indebtedness"). We hereby waive any presentation, demand, protest or notice of any kind whether judicial or extra judicial. We further agree that you are at liberty to vary or release securities, to grant time, indulgence or renewals to AST Research, Inc. or vary the terms or conditions of the Facility, without prejudicing or affecting your rights against us under this guarantee. We agree that we shall not be entitled to prove in the liquidation of AST Research, Inc. in competition with you or to have the benefit of any securities you may hold until the whole of your claim in respect of the Indebtedness is satisfied. We further represent, warrant and agree that we have full power and authority to execute and deliver this guarantee and that the liability assumed by us hereunder constitutes a legally and binding obligation enforceable in accordance with its terms, payable in lawful currency of the United States of America at your principal office in New York City in freely transferable and immediately available funds and free and clear and without deduction for or on account of any present or future taxes, charges or deductions of any kind whatsoever. This guarantee shall be governed by the internal laws of the State of New York. This guarantee shall be a continuing security and shall remain in full force and binding until such time as all sums due and payable have been irrevocably paid in full and this guarantee has been released by you. Samsung Electronics Co., Ltd. By /s/ KWANG HO KIM Its Vice Chairman EX-99.4 5 ADVANCE ACCOUNT AGREEMENT TO Bank of America We hereby authorize you to open on the books of a Bank of America unit of your choice, an account or accounts in our name to be designated "Advance Accounts" or such other designation as you may see fit to give such account or accounts, and to charge to such account or accounts all drafts drawn on you by us and all advances of every kind and nature and in any convertable currency which you may make to us or which you may make for or on our behalf upon our direction. The maximum amount of such advances at any time shall be as you and we agree upon in writing from time to time. Upon prior written notice, the domicile of this loan may be changed from time to time at the Bank's discretion. In consideration of such advances as you may have made or may hereafter make, we agree immediately upon your demand to repay you the total amount of any and all such advances which you may have made, together with interest thereon at the rate of * percent ( * %) per annum, unless a different rate of interest has been or may be agreed upon in writing between you and us; until such payment to you, you may retain all drafts and other instruments or papers evidencing charges to said account. It is understood that you reserve the right to terminate these arrangements at any time. We will at your written request execute and deliver to you a promissory note in that same currency for the then balance in the Advance Account, payable on demand, and bearing interest as aforesaid; also, in the event that in connection with advances made under said Advance Account you deliver, or cause to be delivered, goods or documents into our possession, we will upon your request grant to you a security interest in such goods or documents, or upon your request execute and deliver to you trust receipts therefor. Very truly yours, Date December 13, 1996 By /s/ Won S. Yang Senior Vice President, Finance and Acting Chief Financial Officer, AST Research Inc. * As mutually agreed from time to time. ADVANCE ACCOUNT AGREEMENT TO Bank of America We hereby authorize you to open on your books an account or accounts in our name to be designated "Advance Accounts" or such other designation as you may see fit to give such account or accounts all drafts drawn on you by us and all advances of every kind and nature which you may make to us or which you may make for or on our behalf upon or direction. The maximum amount of such advances at any time shall be as you and we agree upon from time to time. In consideration of such advances as you may have made or may hereafter make, we agree immediately upon your demand to repay to you the total amount of any and all such advances which you may have made, together with interest thereon at the rate of * percent ( * %) per annum, unless a different rate of interest has been or may be agreed upon between you and us; until such payment to you, you may retain all drafts and other instruments or papers evidencing charges to said account. It is understood that you reserve the right to terminate these arrangements at any time. We will at our request execute and deliver to you a promissory note for the then balance in the Advance Account, payable on demand, and bearing interest as aforesaid; also, in the event that in connection with advances made under said Advance Account you deliver, or cause to be delivered, goods or documents into our possession, we will upon your request grant to you a security interest in such goods or other documents, or upon your request execute and deliver to you trust receipts therefor. Very truly yours, Date December 13, 1996 By /s/ Won S. Yang Senior Vice President, Finance and Acting Chief Financial Officer, AST Research Inc. * As mutually agreed from time to time. EX-99.5 6 December 16, 1996 AST Research, Inc. 16215 Alton Parkway Irvine, CA 92718 Ladies and Gentlemen: It is a pleasure for us to confirm to you that, pursuant to the terms and conditions of this Agreement, we are placing at your disposal an uncommitted revolving credit facility in the amount of Fifty Million United States Dollars (U.S. $50,000,000). The Facility shall be available until the earlier of (a) the termination of this Facility pursuant to Section 9 hereof and (b) the date designated by you or us in a seven day advance written notice to the other party as the termination date of this Facility (the "Termination Date"); provided however that as long as no Event of Default exists, all amounts outstanding shall be payable upon the maturity thereof. 1. DEFINITIONS (a) Defined terms: As used in this Agreement, the following terms have the respective meanings assigned thereto: "Agreement" means this letter agreement and all schedules and exhibits attached hereto, as they may be amended, supplemented or otherwise modified from time to time. "Borrowings" means any amounts outstanding under the Facility, whether in respect of Domestic Dollar Borrowings, or Eurodollar Borrowings. "Business Day" means any day other than a Saturday, Sunday or any other day on which commercial banks in New York, New York are not authorized or obligated by law to close. "Dollars" or "$" means the lawful currency of the United States of America. "Domestic Dollar Borrowings" means any borrowings under the Facility made pursuant to Section 4.1 of this Agreement. "Environmental Laws" means Federal, state, local or foreign laws or regulations concerning the handling, release, disposal or discharge of materials into the environment and the protection or clean-up of the environment. "Eurodollar Borrowings" means any borrowings under the Facility made pursuant to Section 4.2 of this Agreement. "Event of Default" means any event specified in Section 9 of this Agreement. "Facility" means the credit available to you, pursuant to the terms set forth in this Agreement for Borrowings. "Federal Bankruptcy Laws" means the Bankruptcy Reform Act of 1978, as amended by the Bankruptcy Amendments and Federal Judgeship Act of 1984, and all the Rules of Bankruptcy Procedure, as any or all of the foregoing may hereafter be amended, supplemented or otherwise modified. "Federal Funds Rate" means the rate for overnight Federal Funds, as published by the Federal Reserve Bank of New York. "Guarantor" means Samsung Electronics Company, Ltd. "Guarantee" means a duly executed guarantee in the form and substance satisfactory to the Bank. "Interest Period" shall have the meaning attributed to it in Section 4.2(a) of this Agreement, subject to the Interest Period Conventions. "Interest Period Conventions" means the following: (a) if any Interest Period would otherwise expire on a day which is not a Business Day, such Interest Period shall expire on the next succeeding Business Day, provided that if any Interest Period in respect of a Eurodollar Borrowing would otherwise expire on a day which is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day; and (b) any Interest Period in respect of a Eurodollar Borrowing which begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month. "Loan Documents" shall have the meaning attributed to it in Section 6(a) of this Agreement. "Note" shall have the meaning attributed to it in Section 3 of this Agreement. "Prime Rate" means the rate of interest announced by us from time to time as our Prime Rate. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged by us to any customer. If the Federal Funds Rate is greater than the Prime Rate for any day, then the Prime Rate for each such day shall be deemed to equal one and one-half percent (1-1/2%) in excess of the Federal Funds Rate for each such day. (b) Accounting Terms: All accounting terms (whether or not capitalized) used but not defined in this Agreement shall be construed in accordance with generally accepted accounting principles in the United States. 2. AMOUNT AND AVAILABILITY We agree, on the terms and conditions of this Agreement, that we may make Borrowings, pursuant to this Facility, from time to time in the manner hereinafter specified, provided that the sum of (i) the aggregate principal amount of all Borrowings shall not exceed $50,000,000. This Facility shall be available until the Termination Date. 3. EVIDENCE OF INDEBTEDNESS The outstanding amount of all Domestic Dollar Borrowings and Eurodollar Borrowings shall be evidenced by your promissory note in the form of Exhibit A attached to this Agreement (as the same may be amended, supplemented or modified from time to time, the "Note") and/or by entries in our records in accordance with our usual banking practice. You hereby authorize us to make notations of all relevant Borrowings and repayments on the schedule attached to the Note. Such notations, if made, shall be presumed correct unless the contrary is established. 4. THE FACILITY 4.1 DOMESTIC DOLLAR BORROWINGS (a) Availability: The Facility may be available for Domestic Dollar Borrowings in an aggregate principal amount up to the lesser of (i) $50,000,000 and (ii) the unused portion of the Facility. (b) Operating Procedure: Each Domestic Dollar Borrowing shall be made on notice given to us in writing, or by telephone to be confirmed promptly thereafter in writing, no later than 12:00 noon (New York City time) on the day of the proposed Domestic Dollar Borrowing specifying the amount of such Domestic Dollar Borrowing. (c) Interest: Each Domestic Dollar Borrowing shall bear interest at a rate per annum which is equal to the Prime Rate. Interest on each Domestic Dollar Borrowing shall be payable on the last day of each month, commencing in the month during which such Domestic Dollar Borrowing is made. All calculations of interest shall be made pursuant to Section 11(b)(ii) of this Agreement. (d) Repayment: All Domestic Dollar Borrowings shall be repayable on the Termination Date and, at the Bank's option on or before December 31 or June 30 of any given year. 4.2 EURODOLLAR BORROWINGS (a) Availability: The Facility may be available for Eurodollar Borrowings in an aggregate principal amount up to the lesser of (i) $50,000,000 and (ii) the unused portion of the Facility. Eurodollar Borrowings shall be available for periods, at your option, of one day to six months (each such period shall be referred to as an "Interest Period"), provided that the Bank can obtain matching deposits in the interbank Eurodollar market for the same Interest Period. The availability of such deposit is to be determined by us in good faith in our sole discretion. (b) Operating Procedure: Each Eurodollar Borrowing shall be made on notice given to us in writing, or by telephone to be confirmed promptly thereafter in writing, no later than 12:00 noon (New York City time) on the Business Day of the proposed Eurodollar Borrowing, specifying (i) the requested date of such Eurodollar Borrowing; (ii) the Interest Period for the Eurodollar Borrowing; and (iii) the amount of such Eurodollar Borrowing. If any requested Interest Period will extend beyond December 31 or June 30 of any year it shall be in the Bank's discretion as to whether to grant such request. (c) Interest: Upon our receipt of the notice specified in paragraph (b) above, we shall quote you the interest rate which shall be equal to forty (40) basis points in excess of the interbank Eurodollar market rate quoted to us for deposits of a corresponding amount and duration, which rate shall apply to the Eurodollar Borrowing requested. If accepted by you, such rate shall be in effect for the entire Interest Period selected. Interest on Eurodollar Borrowings shall be payable on the last day of each Interest Period (subject to the Interest Period Conventions). All calculations of interest shall be made pursuant to Section 11(b)(ii) of this Agreement. (d) Repayment: You shall have the option either to repay an outstanding Eurodollar Borrowing on the last day of an Interest Period applicable thereto or, with our consent, to continue such Eurodollar Borrowing for another Interest Period, provided that you notify us in writing, or by telephone to be confirmed promptly thereafter in writing, not later than two Business Days prior to the last day of such Interest Period, whether you shall repay such Eurodollar Borrowing or continue it for another Interest Period and, if you elect to continue such Eurodollar Borrowing, the duration of the Interest Period selected. The giving of such notice shall be irrevocable and binding on you and shall commit you to accept the interest rate established in accordance with Section 4.2(c) of this Agreement. In the event that we do not receive such notice within the time specified above, the applicable Eurodollar Borrowing shall automatically be converted into a Domestic Dollar Borrowing which shall accrue interest in accordance with Section 5 hereof. (e) Voluntary Prepayment: You may prepay any Eurodollar Borrowing, in whole or in part, from time to time without premium or penalty upon not less than two Business Days' notice to us. Any such prepayment shall be accompanied by accrued but unpaid interest on the principal amount so prepaid. In the event that you make any repayment or prepayment in respect of any Eurodollar Borrowing other than on the last day of an Interest Period relative to the amount being so repaid or prepaid, you shall forthwith on demand from us pay to us such additional amount as necessary to compensate us for any loss or expense sustained or incurred by reason of the liquidation or reemployment of deposits or other funds acquired by us in order to fund such Eurodollar Borrowing then being repaid or prepaid. (f) Mandatory Prepayment: In the event that any change in any applicable law or regulation or in the interpretation thereof by any governmental authority shall make it unlawful for us to make or maintain any Eurodollar Borrowing, you shall, upon notice to such effect from us, repay to us within thirty (30) days the aggregate unpaid principal amount of all Eurodollar Borrowings, together with accrued interest thereon. You shall also pay to us all costs incurred by us in connection with such prepayment and compensate us for any loss suffered by us by reason of such prepayment not being made on the last day of an Interest Period. (g) Reserve Requirements: If at any time during the term of this Agreement, any reserve, special deposit or similar requirement against our assets, deposits with us or for our account, or credit extended by us, shall be imposed on us, or we shall be subject to any tax, duty or other charge with respect to Eurodollar Borrowings, then at our sole discretion the interest rate applicable to each Eurodollar Borrowing will be subject to upward adjustment to compensate us for the cost (as determined by us) of complying with the foregoing. In the event of such adjustment, you shall have the right to prepay the aggregate unpaid principal amount of all Eurodollar Borrowings, together with accrued interest thereon. You shall pay to us all costs incurred in connection with such prepayment and compensate us for any loss suffered by reason of such prepayment not being made on the last day of an Interest Period. (h) Inability to Determine Interest Rate: In the event that we shall have determined (which determination shall be conclusive and binding upon you) that by reason of circumstances affecting the interbank Eurodollar market, adequate and reasonable means do not exist for ascertaining the interest rate with respect to Eurodollar Borrowings for any Interest Period, we shall forthwith give you notice of such determination, and no further Eurodollar Borrowings shall be made until we shall have withdrawn such notice. You may continue to borrow under the Facility at a rate to be agreed upon by both parties. 4.3 LETTERS OF CREDIT/ACCEPTANCES This Facility may be available for Standby Letters of Credit, Documentary Letters of Credit and Acceptances based on the Bank's standard documentation and on commercially reasonably terms. 5. INTEREST AFTER DUE DATE Interest on all Borrowings which are outstanding after their due date (whether at their stated maturity, by acceleration or otherwise) shall be immediately payable without demand at a rate equal to two percent (2%) per annum in excess of the Prime Rate, which interest shall accrue and be calculated in accordance with the terms of this Agreement 6. CONDITIONS PRECEDENT The availability of the Facility is subject to the condition that, on or prior to the date of this Agreement, there shall have been delivered to us, in form and substance satisfactory to us and our counsel: (a) Loan Documents: This Agreement, the Note and all other instruments, agreements and documents required under this Agreement (collectively, the "Loan Documents"), duly executed by your authorized officers; (b) Certificate of Incorporation and By-Laws: A copy of your certificate of incorporation, certified by the Secretary of State of the State of your incorporation, and of your by-laws, certified by your Secretary or Assistant Secretary; (c) Good Standing Certificate: A good standing certificate for you, certified by the Secretary of State of the State of your incorporation, dated no earlier than thirty (30) days prior to the date hereof; (d) Corporate Resolutions: A copy of a resolution or resolutions adopted by your Board of Directors, in form and substance satisfactory to us, certified by your Secretary or Assistant Secretary as being in full force and effect, authorizing the Borrowings provided for in this Agreement and the execution, delivery and performance of the Loan Documents; (e) Certificate of Incumbency: A certificate, signed by your Secretary or Assistant Secretary, as to the incumbency of the person or persons authorized on your behalf to execute and deliver the Loan Documents and to give any notice of any Borrowing requested hereunder; and (f) Opinion of Counsel: A favorable opinion addressed to us by your counsel (who shall be satisfactory to us), substantially in the form of Exhibit B attached to this Agreement. (g) Guaranty: The duly executed Guaranty in the form of Exhibit C attached to this Agreement; (h) Corporate Resolutions of Guarantor: A copy of a resolution or resolutions adopted by the Guarantor's Board of Directors, in form and substance satisfactory to us, certified by its Secretary or Assistant Secretary as being in full force and effect, authorizing the issuance of the Guarantee; and (i) Certificate of Incumbency of Guarantor: A certificate, signed by the Guarantor's Secretary or Assistant Secretary, as to the incumbency of the person or persons authorized on its behalf to execute and deliver the Guarantee. 7. REPRESENTATIONS AND WARRANTIES You hereby represent and warrant to us that the following statements are true and accurate as of the date of your acceptance of this Agreement and shall be true and accurate as of the date of any Borrowing hereunder, except as previously communicated to, and approved by, us in writing: (a) You are a corporation duly organized, validly existing and in good standing under the laws of the State of your incorporation; you are fully qualified to do business wherever the nature of your business or the ownership or use of your property requires such qualification; and you have full power and authority, corporate and otherwise, to enter into this Agreement, to make the Borrowings contemplated by this Agreement and to deliver the Loan Documents; (b) Neither the execution and delivery of this Agreement or any other Loan Document, nor compliance with the provisions thereof will violate any law or regulation or any order or decree of any court or governmental instrumentality, or will conflict with, or result in the breach of, or constitute a default under, any indenture, mortgage, deed of trust, agreement or other instrument to which you are a party or by which you may be bound, or result in the creation or imposition of any lien, charge or encumbrance upon, any of your property thereunder, or violate any provision of your Certificate of Incorporation, By-laws or any preferred stock provisions; (c) This Agreement and the other Loan Documents constitute your valid and legally binding obligations, enforceable against you in accordance with their terms; (d) There are no pending or threatened actions, suits or proceedings before any court, arbitrator or governmental or administrative body or agency which are reasonably likely to result in any material adverse change in your business, operations, properties or assets or in your condition, financial or otherwise other than have been disclosed in public filings by the Company to the U.S. government; (e) You are not in default under any indenture, mortgage, deed of trust, agreement or other instrument to which you are a party which is reasonably likely to result in any material adverse change in your business, operations properties or assets or in your condition, financial or otherwise; (f) You have good and marketable title to all your properties and asset, and, except for Permitted Liens, there are no liens, mortgages, pledges, security interest, encumbrances or charges of any kind on your properties or assets; (g) You have filed all tax returns which are required to be filed, and have paid all taxes which have become due pursuant to such returns or pursuant to any assessment received by you except for disputed assessments as disclosed by the company in public filings with the U.S. Government; (h) All information relative to you and your financial condition furnished to us by you for the purpose of obtaining the Facility is true and correct in all material respects; and (i) You are in material compliance with all Environmental Laws; you have not received any notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters or compliance with Environmental Laws, and you have no knowledge or reason to believe that any such notice will be received or is being threatened. (j) Your obligations under the Facility are and will continue to be pari passu in right of repayment and otherwise with your other unsecured and unsubordinated obligations as a borrower or a guarantor. 8. COVENANTS During the term of the Facility and until all of your obligations and liabilities incurred under this Agreement have been repaid in full, you shall, unless we shall give our prior written consent otherwise: (a) Furnish to us: (i) within one hundred twenty (120) days after the end of each of your fiscal years, a copy of your balance sheet as of the end of such fiscal year and statements of income, shareholders equity and cash flows for such fiscal year, certified by independent public accountants of recognized standing reasonably acceptable to us; and (ii) such other information respecting your business, properties, condition or operations, financial or otherwise, as we may from time to time reasonably request; (b) Notify us of: (i) any material change in your business which is reasonably likely to impair your ability to repay amounts outstanding under the Facility; (ii) the occurrence of any default, or any event which, with the passage of time or the giving of notice (or both), would result in any default, in any mortgage, indenture, instrument or agreement (including, without limitation, this Agreement) under which there may be issued, or by which there may be incurred or evidenced, any of your indebtedness for borrowed money (other than this Agreement, in an amount equal to $5,000,000 or more); and (iii) all pending or threatened actions, suits or proceedings before any court, arbitrator or governmental or administrative body or agency which is reasonably likely to result in any material adverse change in your business, operations, properties or assets or in your condition, financial or otherwise; (c) Keep at all times books of records and accounts in which full, true and correct entries shall be made of all dealings and transactions in relation to your business and affairs: (d) Maintain your corporate existence and keep all property which is required for your ongoing operations, business or condition (financial or otherwise) in good repair, working order and condition; (e) Pay and discharge all taxes, assessments and governmental charges or levies imposed upon you or your income or profits, or upon any of your property, prior to the date on which penalties attach thereto, unless you shall contest in good faith and by proper proceedings the payment of any such tax, assessment, charge or levy and you shall maintain adequate reserves therefor; (f) Keep all of your properties adequately insured at all times with responsible insurance carriers against loss or damage by fire and other hazards, maintain adequate insurance at all times with responsible insurance carriers against liability on account of damage to persons and property and under all worker's compensation laws and maintain adequate insurance covering such other risks as we may reasonably request; (g) Allow us to visit and inspect any of your properties, have mutually acceptable independent accountants examine your books of account and other records and files and make copies thereof, and to discuss your business affairs and finances with your officers and employees, at such reasonable times, duration, intervals and notice as we shall request; and (h) Comply with the requirements of all applicable laws, rules, regulations and orders except where the failure to so comply would not reasonably be expected to have a material adverse effect on your business, operations properties or assets or your condition, financial or otherwise; (i) Not, nor shall it permit any of its subsidiaries to, directly or indirectly, make, create, incur, assume or suffer to exist any Lien upon or with respect to any part of its property or assets, whether now owned or hereafter acquired or agree to do so, other than the following ("Permitted Liens"); (A) any Lien existing on the property of the Company on the date hereof securing indebtedness outstanding on such date; (B) Liens for taxes, fees assessments or other governmental charges which are not yet delinquent or remain payable without penalty, or to the extent that there is non-payment thereof, provided that (i) no Notice of Lien has been filed or recorded in the United States of America and (ii) no Notice of Lien has been filed or recorded in any other jurisdiction except such Notices of Lien which would not have a material adverse effect on the Company; (C) carriers', warehousemen's mechanics, landlords', materialmen's, repairmen's or other similar Liens arising in the ordinary course of business which are not delinquent or remain payable without penalty or which are being contested in good faith and by appropriate proceedings; (D) Liens (other than any Lien imposed by ERISA) on the property of the Company or any of its subsidiaries incurred, or pledges or deposits required in connection with worker's compensation, unemployment insurance, other social security legislation and Liens consisting of deposits placed with insurance companies for health insurance created in the ordinary course of business; (E) Liens on the property of the Company or any of its Subsidiaries securing (i) the performance of bids, trade contracts (other than for borrowed money), leases, subleases, statutory obligations and regulatory or other governmentally imposed obligations and (ii) obligations on surety, appeal, performance or similar bonds, and (iii) other obligations of a like nature incurred in the ordinary course of business provided all such Liens in the aggregate would not have a material adverse effect on the Company; (F) easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business which in the aggregate, are not substantial in amount, and which do not in any case materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the businesses of the Company and its subsidiaries; (G) purchase money security interest on any real or personal property acquired or held by the Company in the ordinary course of business, securing indebtedness incurred or assumed for the purpose of financing all or any part of the cost of acquiring such property or capital lease obligations; provided that any such Lien attaches to such property concurrently with or within 30 days after the acquisition or refinancing thereof; (H) Liens on property existing prior to the acquisition of such property by the Company or its subsidiaries and not created in anticipation of such acquisition; (I) Extension and renewals of any Lien described in this subsection; (J) Liens which constitute rights of set-off of customary nature or bankers' Liens with respect to amounts on deposit, whether arising by operation of law or by contract, in connection with working capital facilities, operational services, lines of credit, term loans, or other credit facilities and similar arrangements entered into with banks in the ordinary course of business; (K) Other Liens incidental to the conduct of the business of the Company or any of its subsidiaries or the ownership of their property which are incurred in the ordinary course of business (and are not security for borrowed money); provided such Liens do not exceed $10,000,000 in the aggregate; and (L) Liens arising in connection with any sale of accounts receivable provided, that the Lien doe not extend beyond the accounts receivable so sold or discounted except to the extent reasonably required by any purchaser of such accounts receivable. 9. EVENTS OF DEFAULT If any of the following events (each an "Event of Default") shall occur: (a) If you shall default in the payment of any principal or accrued interest on the Note or any other amount payable under any of the Loan Documents; (b) If you shall default in the due performance and observance of any provision contained in this Agreement or any other Loan Document; (c) If any representation or warranty made by you in this Agreement or any other Loan Document, or any statement in any certificate, schedule, financial statement, or other instrument furnished to us in accordance with the provisions of this Agreement or any other Loan Document, shall prove to have been untrue in any material respect when made or given; (d) If you or the Guarantor shall default under any agreement or instrument creating or evidencing any obligation by you or the Guarantor, direct or contingent, for the payment of borrowed money for an amount not exceeding $5,000,000 in your case or $20,000,000 in the case of the Guarantor; (e) If you or the Guarantor shall: (i) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of all or any substantial part of your or the Guarantor's assets or voluntarily terminate your or the Guarantor's operations; (ii) Admit in writing your or the Guarantor's inability to pay your debts as they mature; (iii) make a general assignment for the benefit of creditors; (iv) be adjudicated bankrupt or insolvent; or (v) file a voluntary petition in bankruptcy or a petition or an answer seeking reorganization or an arrangement with creditors or to take advantage of any insolvency law or an answer admitting the material allegations of a petition filed against you or the Guarantor in any bankruptcy, reorganization or insolvency proceeding; or take any action for the purpose of effecting any of the foregoing; (f) If an order, judgment or decree shall be entered by any court of competent jurisdiction, approving a petition seeking your or the Guarantor's reorganization or appointing a receiver, trustee or liquidator of all or any substantial part of your or your Guarantor's assets or an order for relief under the Federal Bankruptcy Laws or any similar law shall have been entered against you or the Guarantor; (g) If a proceeding shall be instituted in any court of competent jurisdiction seeking your or the Guarantor's adjudication in bankruptcy, reorganization, dissolution, winding up, liquidation, a composition or arrangement with your or the Guarantor's creditors, a readjustment of your or the Guarantor's debts, the appointment of a trustee, receiver, custodian, liquidator or the like of all or any substantial part of your or the Guarantor's assets, or other like relief under any bankruptcy or insolvency law and, if such proceeding is being contested by you in good faith, the same shall continue undismissed or unstayed and in effect for any period of thirty (30) consecutive days; (h) If there shall be entered against you or the Guarantor one or more judgments or decrees, which judgments or decrees, to the extent not covered by insurance, exceed, individually or in the aggregate, $5,000,000 and which judgments or decrees have not been paid, vacated, discharged, stayed or bonded pending appeal within thirty (30) days from the entry thereof; or (i) If the Guaranty shall be invalid or unenforceable or if the Guarantor has defaulted thereunder; or (j) If Samsung Electronics Co., Ltd. shall beneficially cease to own directly or indirectly at least 40% of your common stock. THEN, (i) this Facility shall immediately terminate; (ii) all amounts in respect of principal and interest and any other amounts due and payable hereunder on Domestic Dollar Borrowings and Eurodollar Borrowings shall be forthwith immediately due and payable without any action on our part and without notice to you and without protest, presentment or demand, all of which are hereby expressly waived by you. 10. CHANGES IN CAPITAL REQUIREMENTS If after the date hereof, we shall have determined that the adoption of any applicable law, rule or regulation regarding capital adequacy, or any change therein or any change in the interpretation or administration thereof, by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by us with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency, has or would have the effect of increasing the amount of capital that we must maintain or reducing our rate of return on our capital as a consequence of our obligation hereunder to a level below that which we could have achieved but for such adoption, change or compliance (taking into consideration our policies with respect to capital adequacy) by an amount deemed by us to be material, then from time to time, within fifteen (15) days after demand by us, you shall pay to us such additional amount or amounts as will compensate us for the cost of such additional capital or reduced rate of return. We shall furnish you with a certificate as to the amount of any such cost or reduced rate of return, which certificate, absent manifest error, shall be final, conclusive and binding for all purposes. 11. MISCELLANEOUS (a) No waiver; Cumulative Remedies: No failure or delay on our part, or on the part of any other holder of the Note, in exercising any right, power or remedy under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. The remedies provided in this Agreement are cumulative and not exclusive of any remedies provided by law. (b) Payments, Interest and Taxes: (i) All payments of principal and interest and other amounts payable under this Agreement and the other Loan Documents shall be made to us at 1221 Avenue of the Americas, New York, New York 10020, in immediately available funds. (ii) All interest payments to be made hereunder shall be computed for the exact number of days elapsed on the basis of a 360- day year. (iii) All payments under this Agreement and the other Loan Documents shall be made without setoff or counterclaim and without deduction for any present or future taxes, levies, imposts, charges or withholdings (collectively, "Taxes"). If you shall be required by law to deduct any Taxes from or in respect of any sum payable under this Agreement or any other Loan Document, (x) the sum payable shall be increased so that we receive an amount equal to that which we would have received had no deduction been made and (y) you shall pay the full amount deducted to the appropriate authority in accordance with applicable law. (c) Addresses for Notices, etc.: Except as provided otherwise in this Agreement, all notices, requests, demands and other communications provided for under this Agreement shall be in writing (including teletransmissions) and shall be deemed delivered (i) when sent, if delivered by hand, (ii) when teletransmitted and receipt is confirmed by telephone and or by a separate mailed writing, or (iii) three (3) Business Days after mailing, if mailed, and all mailed notices shall be by registered mail, postage prepaid, to the appropriate party or parties at the address or addresses appearing on the signature pages hereof, or, at such other address as shall be designated by such party in written notice to the other party, complying as to delivery with the terms of this Section 11(c). (d) Jurisdiction: You agree to submit to the jurisdiction of all federal and state courts located in the State of New York for any legal proceeding arising from this Agreement or any other Loan Document and consent that personal jurisdiction may be obtained over you by mailing a summons by registered mail or certified mail, return receipt requested, within or without such court's jurisdiction, or by personal service, provided a reasonable time for appearance is allowed. (e) Modifications: No modification or waiver of any provision in this Agreement or any other Loan Document and no consent to any departure therefrom shall in any event be effective unless the same shall be in writing and signed by us and then such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given. (f) Maximum Interest Rate: No provision of this Agreement or any other Loan Document shall require the payment, or permit the collection, of any interest in excess of the highest rate permitted by applicable law. (g) Survival of Agreements: All covenants, representations, warranties and other agreements made in this Agreement or any other Loan Document and any certificates delivered in connection therewith shall survive any Borrowings under the Facility and shall continue in full force and effect so long as any amount owing under any of the Loan Documents is outstanding and unpaid or this Agreement remains in effect. (h) Severability: Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall be ineffective only in such jurisdiction to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Agreement. (i) Setoff: In addition to any right or remedy we may have by law, we shall have the right, without prior notice to you, any such notice being expressly waived by you to the extent permitted by law, on the occurrence of an Event of Default, to set off and apply against any amounts of principal, interest or other amounts arising hereunder, whether matured or unmatured, any amount owing from us to you, at any time after the occurrence of an Event of Default and such right of setoff may be exercised against any trustee in bankruptcy, debtor-in-possession, or any other person claiming through you, notwithstanding the fact that such right of setoff shall not have been exercised prior to the making, filing or issuance, or service on us of, or of notice of, any such event or proceeding. (j) Costs and Expenses: You agree to pay to us all costs and expenses (including reasonable attorneys' fees and disbursements) arising from or incidental to the preparation and enforcement of any provision of this Agreement or any other Loan Document. (k) Successors and Assigns: This Agreement shall be binding upon and inure to the benefit of us and you and all future holders of the Note, and their respective successors and assigns, except that you may not assign or transfer your rights or obligations under this Agreement without our prior written consent. (l) WAIVER OF JURY TRIAL: TO THE MAXIMUM EXTENT PERMITTED BY LAW, YOU AND WE HEREBY EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY ACTION, CAUSE OF ACTION, CLAIM, DEMAND, OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS AGREEMENT, OR IN ANY WAY CONNECTED WITH, RELATED TO, OR INCIDENTAL TO OUR DEALINGS WITH EACH OTHER WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. (m) GOVERNING LAW: THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO ITS CONFLICTS OF LAW PRINCIPLES. We are pleased to offer you this Facility. If the terms and conditions specified above are acceptable to you, please indicate your acceptance thereof by signing and returning to us the attached copy of this Agreement, whereupon this Agreement shall become a binding agreement between us. Very truly yours, SOCIETE GENERALE, NEW YORK BRANCH By: /s/ DAVID THACKRAY Name: David Thackray Title: Vice President Address for notices: 1221 Avenue of the Americas New York, New York 10020 Attention: David Thackray Telex: 428802 SOCIEGEN Telecopier: (212) 278-7462 AGREED AND ACCEPTED AS OF THE DATE FIRST WRITTEN ABOVE: AST RESEARCH, INC. By: /s/ WON SUK YANG Name: Won Suk Yang Title: Sr VP, Finance & CFO (acting) Address for notices: 16215 Alton Parkway Irvine, CA 92618 Attention: Julie Nakata Telex: _____________________ Telecopier: (714) 727-8584 EXHIBIT A FORM OF PROMISSORY NOTE U.S. $50,000,000 December __, 1996 New York, New York FOR VALUE RECEIVED, the undersigned, AST RESEARCH, INC. (the "Borrower"), hereby unconditionally promises to pay to the order of Societe Generale, New York Branch (the "Bank"), on the dates and in the manner specified in the Agreement hereinafter defined, at the Bank's office located at 1221 Avenue of the Americas, New York, New York 10020, in immediately available funds, the principal sum of Fifty Million United States Dollars (U.S. $50,000,000) or the unpaid principal amount of all Borrowings by the Borrower from the Bank pursuant to the Agreement, (as defined below) whichever is less. All payments of principal of the outstanding amounts of all Borrowings evidenced by this Note shall be made in the manner specified in the Agreement. The Borrower hereby further promises to pay interest in like money and funds on the daily outstanding balance of each such Borrowing for the period commencing on the date of each such Borrowing until repaid in full, at the rate and in the manner specified in the Agreement. The Bank is authorized to make notations of all Borrowings made by the Borrower from the Bank pursuant to the Agreement and all repayments of the outstanding principal amounts and accrued interest on such Borrowings on the schedule attached to and made a part of this Note. Such notations, if made, will be presumed correct unless the contrary is established. If this Note becomes due and payable on any day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day and interest shall be payable on such outstanding amount at the rate specified in the Agreement during such extension. This Note is the note referred to in that certain letter agreement dated December __, l996, as hereinafter amended, supplemented or modified (the "Agreement"), between the Borrower and the Bank, which provides for the prepayment of this Note on certain events, the acceleration of its maturity and other terms and conditions relating to this Note, all of which are herein incorporated by reference. In addition to all principal and accrued interest on this Note, the Borrower agrees to pay (a) all costs and expenses incurred by all of the holders of this Note in collecting this Note, whether through probate, reorganization, bankruptcy or other proceedings; and (b) reasonable attorneys' fees when and if this Note is placed in the hands of an attorney for collection. Presentment, demand, protest and notices of any kind with respect to this Note are hereby expressly waived by the Borrower Capitalized terms used but not defined in this Note shall have the meanings attributed to them in the Agreement. This Note and the rights and obligations of the parties under this Note shall be governed by, and construed and interpreted in accordance with, the law of the State of New York, without regard to its conflicts of law principles. AST RESEARCH, INC. By: /s/ MARK P. DE RAAD Name: Mark P. de Raad Title: VP, Finance & Treasurer By: /s/ WON SUK YANG Name: Won Suk Yang Title Sr VP, Finance & CFO EXHIBIT B FORM OF LEGAL OPINION OF BORROWER'S COUNSEL [Date] Societe Generale, New York Branch 1221 Avenue of the Americas New York, New York 10020 Ladies and Gentlemen: We are counsel to AST Research, Inc. (the "Company") and we have been asked to deliver this opinion in connection with the execution and delivery of a letter agreement dated as of December __, 1996, between you and the Company, providing for a credit facility in the amount of U.S. $50,000,000 (the "Loan Agreement"). We have also reviewed the corporate organization and existence of the Company and the corporate proceedings of the Company in relation to the Loan Agreement, the Promissory Note (the Loan Agreement, the Promissory Note being hereinafter referred to collectively as the "Loan Documents") and such other matters as we have deemed necessary or relevant as a basis for this opinion. Based upon the foregoing, it is our opinion that: 1. The Company is a duly organized and validly existing corporation in good standing under the laws of the State of ______________________, with perpetual corporate existence, and has the corporate power and authority to own its properties and to transact the business in which it is engaged or presently proposes to engage. 2. The Company has the corporate power to execute, deliver and carry out the terms and provisions of the Loan Documents and the Company has duly taken or caused to be taken all necessary corporate action (including but not limited to) the obtaining of any consent of stockholders required by law or by the Certificate of Incorporation or By-laws of the Company to authorize the execution, delivery and performance of the Loan Documents. 3. Neither the execution and delivery of the Loan Documents, nor compliance with the provisions thereof will violate any law or regulation or any order or decree of any court or governmental instrumentality, or will conflict with, or result in the breach of, or constitute a default under, any indenture, mortgage, deed of trust, agreement or other instrument of which we have knowledge to which the Company is a party or by which it might be bound, or result in the creation or imposition of any lien, charge or encumbrance upon, any of the property of the Company thereunder (except in your favor), or violate any provision of the Certificate of Incorporation, By-laws or any preferred stock provisions of the Company. In this connection, we have made a reasonable investigation with respect to the existence of any such indenture, mortgage, deed of trust, agreement or other instrument. 4. There are no actions, suits or proceedings pending or threatened against or affecting the Company before any court, arbitrator or governmental or administrative body or agency which might result in any material adverse change in the business, operations, properties or assets or in the condition, financial or otherwise, of the Company. 5. No action of, or filing with, any governmental or public body or authority is required to authorize, or is otherwise required in connection with, the execution, delivery and performance of the Loan Documents. 6. The Loan Documents have been duly executed and delivered by the Company and constitute valid and binding obligations of the Company. Very truly yours, EXHIBIT C FORM OF GUARANTEE In consideration of loans, extensions of credit or other financial accommodations by Societe Generale, a French bank acting through its New York Branch, having an office at 1221 Avenue of the Americas, New York, New York 10020 (the "Bank"), to or for the account of AST Research, Inc., a corporation organized under the laws of Delaware (the "Borrower"), Samsung Electronics, Company, Ltd., a corporation duly organized under the laws of Korea, having its principal offices in Korea (the "Guarantor"), hereby undertakes and agrees as follows: Section 1. Guarantee. (a) The Guarantor, as primary obligor and not merely as surety, hereby absolutely, irrevocably and unconditionally guarantees, as and for its own debt, the due and punctual payment of all Obligations (as hereinafter defined) of the Borrower when and as the same shall become due and payable (whether on demand, at stated maturity, upon acceleration or otherwise). (b) The Guarantor hereby agrees that this Guarantee is a continuing guarantee of payment and not of collection, that it is a primary, independent obligation of the Guarantor and that the Guarantor's obligations hereunder shall be unconditional and irrevocable, irrespective of any invalidity, illegality or unenforceability of, or defect in or any change in or amendment modification or waiver of the time, manner, place of payment or any other term or condition of any credit, financial accommodation, loan, promissory note, draft, agreement or other document or instrument evidencing any of the Obligations, or the sale, exchange, release, surrender, realization upon or other dealings with any security therefor (whether now or hereafter granted to the Bank), any settlement or compromise thereof, the absence of any action to enforce the same, any waiver or consent by the Bank with respect to any provision thereof, the recovery of any judgment against the Borrower or any other person, or any action to enforce the same, or the recovery of any claim under any applicable insurance, or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor or a borrower. (c) The Guarantor hereby waives notice of acceptance of this Guarantee, the extension of any credit or financial accommodation, the making of any loan or the incurrence of any other Obligation and, with respect to any Obligation and any promissory note or other instrument or document evidencing any Obligation, promptness, diligence, presentment, demand of payment, filing of claims with a court in the event of bankruptcy of the Borrower or any other person, any right to require a proceeding or the filing of a claim first against the Borrower, any other guarantor, any other person, or any collateral security for any of the Obligations, protest, notice of default, dishonor or nonpayment and any other notice and all demands whatsoever. (d) The Guarantor hereby agrees that in the event that any payment is made by the Guarantor under this Guarantee, and is thereafter required to be rescinded or otherwise restored or paid over to the Guarantor or any other person (whether upon the insolvency or bankruptcy of the Borrower or the Guarantor, or otherwise), the Guarantor's obligations hereunder shall immediately and automatically be reinstated as though such payment has not been made. (e) The Guarantor further agrees that the Bank shall have no duty to advise the Guarantor of information known to it regarding the financial condition of the Borrower and the Guarantor hereby assumes responsibility for keeping itself advised of the financial condition of the Borrower. (f) As used herein the term "Obligations" shall mean all indebtedness, obligations and liabilities of the Borrower to the Bank, or in which the Bank has any interest, whether created directly or acquired by assignment or otherwise, of whatsoever kind, whether now or hereafter existing or arising, wheresoever payable, whether or not represented by a note, draft or other evidence of indebtedness, whether arising out of loans, advances on open account, letters of credit, overdrafts, acceptances, contracts (including, without limitation, foreign exchange spot and forward contracts), agreements (including, without limitation, any agreement by the Borrower to pay attorneys' fees and costs of collection), torts or by operation of law, whether consisting of principal, interest, fees or other charges, whether absolute or contingent, joint or several, secured or unsecured, due or not due, direct or indirect, liquidated or unliquidated, and whether incurred by the Borrower as principal, surety, endorser, guarantor, accommodation party or otherwise. "Obligation" as used in the singular herein shall mean any of the foregoing. (g) This Guarantee shall remain in full force and effect until the indefeasible payment in full of all of the Obligations and the obligations of the Guarantor hereunder. Section 2. Representations, Warranties and Agreements. The Guarantor represents and warrants that: (a) the Guarantor is a duly authorized, validly existing corporation in good standing under the laws of the jurisdiction of its incorporation and is duly qualified to do business in such other jurisdictions where required by its business, and has the necessary corporate and legal power and authority to execute and deliver this Guarantee and to carry out the terms and provisions hereof and has taken all necessary action to authorize the execution, delivery and performance of same; (b) this Guarantee is a legal, valid and binding obligation of the Guarantor enforceable in accordance with its terms; (c) no order, consent, license, authorization or approval of, or exemption by, or giving of notice to, or registration or filing with, or the taking of any other action in respect of, any governmental agency or public authority is required to authorize the execution, delivery and performance of this Guarantee except for the approval of the Bank of Korea for the issuance, execution, delivery and performance of the Guarantee by the Guarantor, which has been obtained and remain in full force and effect, and the payment report to the Guarantor's designated foreign exchange bank required for payment under the Guarantee, which will be filed at the time of each actual payment under the Guarantee; (d) neither the execution and delivery of this Guarantee, nor the consummation of the transactions herein contemplated, nor compliance with the terms and provisions thereof, will contravene any law or regulation to which the Guarantor is subject or any franchise or permit applicable to the Guarantor or the Guarantor's business or will conflict or be inconsistent with, or will result in any breach of, any of the terms, covenants or provisions of, or constitute a default under, or result in the creation or imposition of any mortgage, pledge, lien, charge, encumbrance or security interest upon any of the property or assets of the Guarantor pursuant to the terms of, any indenture, mortgage, deed of trust, agreement or other instrument to which the Guarantor is a party or by which the Guarantor may be bound; (e) the Guarantor has not granted, created or permitted to exist any mortgage, pledge, lien, charge, encumbrance or other security interest (collectively "Encumbrances") on any property, assets, revenues or earnings of the Guarantor, to secure any indebtedness of the Guarantor except those, if any, existing on the date hereof of previously disclosed in writing to the Bank; and (f) on and as of the date hereof the Guarantor is the record and beneficial owner of 40% of the issued and outstanding shares of capital stock of the Borrower. Section 3. Covenants. The Guarantor hereby covenants and agrees that so long as any Obligations or any obligations of the Guarantor hereunder remain outstanding, the Guarantor will not: (a) sell, transfer, dispose of or encumber any of the shares of the Borrower presently held (whether beneficially or of record, whether directly or indirectly) by the Guarantor and will maintain the same percentage ownership of the Borrower as is set forth in the Section 2(f) hereof; (b) enter into, or suffer or permit the Borrower to enter into any merger or consolidation with any person provided that the foregoing restriction shall not apply if the Guarantor or the Borrower shall be a continuing corporation; or (c) sell or dispose of, or suffer or permit the Borrower to sell or dispose of, all or a substantial part of its assets (whether in one or a series of transactions), except: (a) dispositions of inventory, or used, worn- out or surplus equipment, all in the ordinary course of business and other dispositions of property (i) not necessary to the normal operations of the Guarantor or the Borrower and (ii) which would not have a material adverse effect on the operation or the financial condition of the Guarantor or the Borrower or a material impairment of the ability of the Guarantor to perform its obligations under the Guarantee or the Borrower to perform its Obligation ("Material Adverse Effect"); (b) the sale of equipment to the extent that such equipment is exchanged for credit against the purchase price of similar replacement equipment or the proceeds of such sale are promptly applied the purchase price of such replacement equipment; (c) dispositions in connection with any capital stock, equity interest, assets, obligations or other securities of, or any interest in, any legal entity (including by merger), or any advance, loan, extension of credit or capital contribution to, or any other investment in, any legal entity ("Investments"), provided that full, fair and reasonable consideration is received in return for any assets disposed of to acquire such Investments; (d) dispositions of any Investments, provided that fair and reasonable consideration is received in connection therewith as reasonable determined by the guarantor or the Borrower; (e) the sale or discounting of accounts receivable by the Guarantor or the Borrower without restriction; (f) sale of trade-related instruments arising in foreign countries, in the ordinary course of business, with or without recourse to the Guarantor or the Borrower to banks or other financial service institutions, for fair value, provided that (i) the amount of any fees, discounts and other consideration received by such banks or other financial service institutions is normal and customary, and (ii) such sales are customary business practices in the country where such activity takes place; (g) the sale or discounting of accounts receivable through asset-backed securitizations so long as fair market value is received for such accounts and so long as there would be no Material Adverse Effect; (h) disposition of the Guarantor's or the Borrower's headquarters building located at the respective addresses set forth herein in a sale-leaseback transaction so long as the Guarantor or the Borrower, as the case may be, receives fair market value for its ownership interest in its headquarters; (i) dispositions not otherwise permitted hereunder which are made for fair market value; provided, that at the time of any disposition, no Event of Default shall exist or shall result from such disposition; and (j) such other dispositions as the bank shall agree to in its sole discretion. The Guarantor further covenants and agrees that the Guarantor will: (a) make all payments hereunder free and clear and net of all withholding and other taxes (except for taxes imposed on the net income of the Bank), by whatsoever jurisdiction imposed; and (b) maintain its and the Borrower's corporate existence and franchises. Section 4. Subordination. The Guarantor hereby subordinates all present and future claims, now held or hereafter acquired, against the Borrower as a creditor or contributor of capital, or otherwise, to the prior and final payment in full to the Bank of all Obligations. If, without reference to the provisions of this Section 4, the Guarantor would at any time be or become entitled to receive any payment on account of any claim against the Borrower, whether in insolvency, bankruptcy, liquidation or reorganization proceedings, or otherwise, the Guarantor shall and does hereby irrevocably direct that all such payments shall be made directly to the Bank (and should the Guarantor receive any such payment, the Guarantor shall receive such amount in trust for the Bank and shall immediately pay over to the Bank such amount) until all Obligations of the Borrower shall be indefensibly paid in full. Section 5. Subrogation. The Guarantor hereby waives any claim, right or remedy which it may now have or hereafter acquire against the Borrower that arises from the Guarantor's obligations hereunder including, without limitation, any right of subrogation, reimbursement, indemnity, exoneration, contribution or participation in any claim, right or remedy of the Bank against the Borrower or any security which the Bank now has or hereafter acquires, whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise, until all the Obligations and any other amounts owing to the Bank shall have been indefeasibly paid in full. Section 6. Jurisdiction. (a) The Guarantor hereby irrevocably agrees that any suit, legal action or proceeding with respect to this Guarantee or any suit, legal action or proceeding to execute or otherwise enforce any judgment obtained against the Guarantor or against the Guarantor's property may be brought in the courts of the State of New York or of the United States of America located in New York City or in any other jurisdiction where assets of the Guarantor may be located, as the Bank may elect, and by execution and delivery of this Guarantee the Guarantor irrevocably submits to the jurisdiction of such courts for the purpose of any suit, legal action or proceeding, waives any and all objections as to inconvenient forum and the like and consents to service of all writs, process and summonses in any such suit, legal action or proceeding brought in such courts by (i) such courts request for assistance to the Supreme Court of Korea through diplomatic channels or (ii) such other means as are permitted under Korean law. (b) Nothing herein contained shall prevent the Bank from serving process or commencing proceedings in any other manner or jurisdiction permitted by applicable law. Section 7. JURY WAIVER. THE GUARANTOR HEREBY WAIVES TRIAL BY JURY IN ANY SUIT, LEGAL ACTION OR PROCEEDING INVOLVING ANY MATTER IN ANY WAY ARISING OUT OF OR RELATING TO THIS GUARANTEE. Section 8. Judgment Currency. If for the purpose of obtaining or enforcing a judgment in any court it becomes necessary to convert into any currency (the "Judgment Currency") any amount due hereunder in any other currency (the "Original Currency"), then conversion shall be made at the rate of exchange prevailing on the business day (the "Determination Date") before the day on which, and at the place at which, judgment is given. "Rate of Exchange" shall mean the rate at which the Bank would be able to sell the Judgment Currency for the Original Currency (including premium and costs of exchange) on the Determination Date. If there is a change in such rate of exchange between the Determination Date and the date of payment, the Guarantor shall pay on the date of payment, such additional amount as is necessary to ensure that the amount paid in the Judgment Currency is the amount then due in the Original Currency, when converted at the prevailing rate of exchange on the date of payment. Any additional amount due from the Guarantor hereunder shall be due as a separate debt and shall not be affected by or merged into any judgment being obtained for any other sums due in respect of this Guarantee. In no event, however, shall the Guarantor be required to pay more U.S. dollars than the total amount stated to be due in dollars, so that the Guarantor's obligations hereunder will be effectively maintained as U.S. dollar obligations. Section 9. Fees and Expenses. The Guarantor hereby agrees to pay all fees (including, without limitation, attorneys' fees) and out-of-pocket expenses of the Bank in connection with any amendment, modification, supplement or waiver of this Guarantee and in connection with the enforcement or preservation of any of the Bank's rights hereunder or with respect to any security therefor. Section 10. Notices. All notices, demands or other communications pursuant hereto shall be in writing and shall be personally delivered or sent by first-class registered mail, postage prepaid, or by telex or telecopier. All notices shall be deemed to have been duly given or made when received in the case of personal delivery, seven days after deposit in the mails, in the case of mail delivery, or when sent, in the case of telex or telecopier notice, in each case to the respective address of the Guarantor or the Bank set forth above or to such other address as the Guarantor or the Bank shall specify to the other pursuant to the terms hereof and its receipt is confirmed. Section 11. Payments. All payments made hereunder shall be payable at the New York office of the Bank referred to herein, or such other office as the Bank may elect, and shall be made in U.S. dollars and in immediately available funds, free and clear of and without set-off, counterclaim withholding for any taxes or other charges or other deduction whatsoever. Section 12. Severability. The invalidity or unenforceability of any one or more phrases, sentences, clauses or Sections in this Guarantee shall not affect the validity or enforceability of the remaining portions of this Guarantee, or any part thereof. Section 13. No Waiver; Amendments; Remedies Cumulative. No failure or delay on the part of the Bank in exercising any right, power or privilege hereunder and no course of dealing between the Guarantor and the Bank shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. Any waiver, amendment, release or modification of this Guarantee shall be in writing duly executed by the Bank and shall be effective only in the specific instance and for the specific purpose given. The rights and remedies herein expressly provided are cumulative and not exclusive of any rights or remedies which the Bank would otherwise have. No notice to or demand on the Guarantor in any case shall entitle any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Bank to any other or further action in any circumstances without notice or demand. Section 14. Benefit of Guarantee. This Guarantee shall be binding upon and inure to the benefit of the successors and assigns of the Bank and the Guarantor; the Guarantor may not assign any of its portion of its obligations hereunder without the prior written consent of the Bank. Section 15. Set-off. The Bank is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by the Bank to or for the credit or the account of the Guarantor against any and all of the obligations of the Guarantor now or hereafter existing under this Guarantee, whether or not the Bank shall have made any demand under this Guarantee and although such obligations may be contingent and unmatured. The Bank agrees promptly to notify the Guarantor after any such set-off and application, provided that the failure to give such notice shall not affect the validity of such set-off and application. The rights of the Bank under this Section are in addition to other rights and remedies (including, without limitation, other rights of set-off) which the Bank may have. Section 16. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ITS CONFLICTS OF LAW PRINCIPLES. IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly executed and delivered on this 11th day of December, 1996. SAMSUNG ELECTRONICS, COMPANY, LTD. By: /s/ KWANG HO KIM Name: Kwang Ho Kim Title: Vice Chairman EX-99.6 7 AMENDED AND RESTATED CREDIT AGREEMENT This Amended and Restated Credit Agreement (the "Agreement") is entered into as of December 17, 1996 among AST Research, Inc., a Delaware corporation (the "Company"), the several financial institutions from time to time party to this Agreement (collectively, the "Banks"; individually, a "Bank"), and Bank of America National Trust and Savings Association, as agent for the Banks (the "Agent"). WHEREAS, the Company, the Banks, and the Agent are parties to a Credit Agreement dated as of December 20, 1995, as amended by a First Amendment thereto dated as of February 29, 1996 (as so amended, the "Prior Agreement"); WHEREAS, the parties hereto desire to amend the Prior Agreement as set forth herein and to restate the Prior Agreement in its entirety to read as set forth in the Prior Agreement with the amendments specified below; NOW, THEREFORE, the parties hereto agree as follows: 1. Definitions; References. (a) Unless otherwise specifically defined herein, each term used herein which is defined in the Prior Agreement shall have the meaning assigned to such term in the Prior Agreement. The term "Notes" defined in the Prior Agreement shall include from and after the date hereof the Notes delivered under this Agreement. (b) Each reference to "hereof", "hereunder", "herein" and "hereby" and each other similar reference and each reference to "this Agreement" and each other similar reference contained in the Prior Agreement and in the other Loan Documents to the Prior Agreement shall from and after the date hereof refer to the Prior Agreement as amended and restated hereby. 2. Amendments to Prior Agreement. (a) Amendments to Article I of the Prior Agreement. (1) The definition of "Applicable Margin" is amended in its entirety to provide as follows: "Applicable Margin" means: (i) with respect to Base Rate Loans, 0%; and (ii) with respect to Offshore Rate Loans .375%. (2) The following definition of "Effective Date" is inserted: "Effective Date" has the meaning specified in the Amended and Restated Credit Agreement dated as of December 17, 1996 among the parties hereto. (3) The definition of "Revolving Termination Date" is amended in its entirety to provide as follows: "Revolving Termination Date" means the earlier of: (a) December 23, 1997; (b) 364 days after the Effective Date; and (c) the date on which the Commitments otherwise terminate in accordance with the provisions of this Agreement. (4) The definitions of "Solvent" and "Tangible Net Worth" are deleted." (b) Amendments to Article II of the Prior Agreement. (1) Section 2.06 is amended by inserting the phrase "on any Offshore Rate Loans (interest on any other type of loans being payable in accordance with Section 2.08)" after the word "interest". (2) Section 2.09 is amended in its entirety to provide as follows: 2.09 Fees. (a) Arrangement, Agency Fees. The Company shall pay an arrangement fee to the Arranger for the Arranger's own account, and shall pay an agency fee to the Agent for the Agent's own account, as required by the letter agreement ("Fee Letter") between the Company and the Arranger and Agent dated December 3, 1996. (b) Commitment Fees. The Company shall pay to the Agent for the account of each Bank a commitment fee on the average daily unused portion of such Bank's Commitment, computed on a quarterly basis in arrears on the last Business Day of each calendar quarter based upon the daily utilization for that quarter as calculated by the Agent, equal to .100 percent per annum. Such commitment fee shall accrue from the Effective Date to the Revolving Termination Date and shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter commencing on March 31, 1997, to the Revolving Termination Date, with the final payment to be made on the Revolving Termination Date; provided that, in connection with any reduction or termination of Commitments under Section 2.05, the accrued commitment fee calculated for the period ending on such date shall also be paid on the date of such reduction or termination, with the following quarterly payment being calculated on the basis of the period from such reduction or termination date to such quarterly payment date. (c) Amendments to Article V of the Prior Agreement. (1) In Section 5.12(a), the phrase "5% of the Company's Tangible Net Worth" is deleted and the phrase "$25,000,000 or more" is inserted in lieu thereof. (2) The text in Section 5.15 is deleted and the phrase "Intentionally Omitted" is inserted in lieu thereof. (d) Amendments to Article VIII of the Prior Agreement. (1) In Section 8.01(f), the phrase "ceases or fails to be Solvent, or" is deleted. (2) In Section 8.01(i), the phrase "10% of Tangible Net Worth" is deleted and the phrase "$25,000,000" is inserted in lieu thereof. (e) Amendments to Schedules to the Prior Credit Agreement. (1) Schedule 2.01 is amended by deleting said Schedule 2.01 in its entirety and by replacing same with the form of Schedule 2.01 attached hereto as Annex 1. (2) Schedule 10.02 is amended by deleting said Schedule 10.02 in its entirety and by replacing same with the form of Schedule 10.02 attached hereto as Annex 2. 3. Representations and Warranties. The Company hereby represents and warrants to the Agent and the Banks as follows: (a) No Default or Event of Default has occurred and is continuing. (b) The execution, delivery and performance by the Company of this Agreement and the Prior Agreement as amended and restated by this Agreement have been duly authorized by all necessary corporate and other action and do not and will not require any registration with, consent or approval of, notice to or action by, any Person (including any Governmental Authority) in order to be effective and enforceable. The Prior Agreement as amended and restated by this Agreement constitutes the legal, valid and binding obligations of the Company, enforceable against it in accordance with its respective terms, without defense, counterclaim or offset. (c) All representations and warranties of the Company contained in the Prior Agreement are true and correct. (d) The Company is entering into this Agreement on the basis of its own investigation and for its own reasons, without reliance upon the Agent and the Banks or any other Person. 4. Effective Date. (a) This Agreement will become effective as of December 24, 1996 (the "Effective Date"), provided that each of the following conditions precedent is satisfied on or before such date: (1) The Agent has received from the Company and each of the Banks a duly executed original (or, if elected by the Agent, an executed facsimile copy) of this Agreement; and, if requested by any Bank, a Note substantially in the form of Exhibit H to the Prior Agreement. (2) The Agent has received all fees and expenses accruing through December 23, 1996 and/or otherwise required to be paid by the Company in connection with the Agreement, other than such fees and expenses for which the Company has not received bills from the applicable Person or Persons. (3) The Agent has received each of the following, in form and substance satisfactory to it and the Banks: (i) copies of the resolutions of the board of directors of (A) the Company authorizing the transactions contemplated hereby and (B) the Guarantor authorizing the transactions contemplated by the Guarantor Acknowledgment and Consent executed by the Guarantor in the form attached hereto as Annex 3 (the "Consent"), each certified as of the Effective Date by the Secretary or an Assistant Secretary or other duly authorized officer of such Person; (ii) a copy of each of the Articles of Incorporation and the Korean Commercial Registry extracts of the Guarantor certified by a Representative Director of the Guarantor; and (iii) a certificate of the Secretary or Assistant Secretary or other duly authorized officer of each of the Company and the Guarantor, as appropriate, certifying (A) the names and true signatures of the officers of the Company and the Guarantor, respectively, authorized to execute, deliver and perform, as applicable, this Agreement, and all other Loan Documents to be delivered by it, respectively, hereunder, and (B) that the charter documents of the Company provided to the Banks at the time of the execution and delivery of the Prior Agreement are in full force and effect and are unchanged from the versions of such documents provided to the Banks at the time of the execution and delivery of the Prior Agreement. (4) The Agent has received a duly executed copy of the Consent. (5) The Agent has received copies of all consents (including, without limitation, the consent of Hanil Bank) required in connection with the execution of this Agreement and the Consent. (6) The Agent has received all other documents it or any Bank may reasonably request relating to any matters relevant hereto, all in form and substance satisfactory to the Agent and the Banks. (b) From and after the Effective Date, the Prior Agreement is amended as set forth herein and is restated in its entirety to read as set forth in the Prior Agreement with the amendments specified herein. The Company represents and warrants that its obligations under the Prior Agreement and under the other Loan Documents are not subject to any defense, counterclaim, set-off, right of recoupment, abatement or other claim. 5. Miscellaneous. (a) This Agreement shall be binding upon and inure to the benefit of the parties hereto and thereto and their respective successors and assigns. (b) This Agreement shall be governed by and construed in accordance with the law of the State of California. (c) This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument. Each of the parties hereto understands and agrees that this document (and any other document required herein) may be delivered by any party thereto either in the form of an executed original or an executed original sent by facsimile transmission to be followed promptly by mailing of a hard copy original, and that receipt by the Agent of a facsimile transmitted document purportedly bearing the signature of a Bank, the Guarantor or the Company shall bind such Bank, the Guarantor or the Company, respectively, with the same force and effect as the delivery of a hard copy original. Any failure by the Agent to receive the hard copy executed original of such document shall not diminish the binding effect of receipt of the facsimile transmitted executed original of such document of the party whose hard copy page was not received by the Agent. (d) Reasonably promptly after the satisfaction of the conditions set forth in Section 4, the Agent will certify such satisfaction in writing to the Company and the Banks; provided, however, that for purposes of determining satisfaction of the conditions specified in Section 4, each Bank that has executed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter either sent by the Agent to such Bank for consent, approval, acceptance or satisfaction, or required thereunder to be consented to or approved by or acceptable or satisfactory to the Bank. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered in San Francisco, California by their proper and duly authorized officers as of the day and year first above written. AST RESEARCH, INC. By: /s/ WON S. YANG Title: Senior Vice President, Acting Chief Financial Officer By: /s/ MARK DE RAAD Title: Vice President, Finance and Treasurer BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent By: /s/ KEVIN MCMAHON Title: BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as a Bank By: /s/ KEVIN MCMAHON Title: ROYAL BANK OF CANADA By: /s/ J.D. FROST Title: BANQUE NATIONALE DE PARIS By: /s/ TJALLING TERPSTRA Title: By: /s/ C. BETTLES Title: NATIONSBANK OF TEXAS, N.A. By: /s/ CATHERINE HUNTER Title: COMMERZBANK AKTIENGESELLSCHAFT, LOS ANGELES BRANCH By: /s/ STEVEN LARSEN Title: By: /s/ WOLTER MEHRING Title: THE FIRST NATIONAL BANK OF CHICAGO By: /s/ J.W. PARK Title: ABN AMRO BANK N.V., LOS ANGELES INTERNATIONAL BRANCH By: ABN AMRO NORTH AMERICA, INC., as agent therefor By: /s/ KENNETH BOWMAN Title: By: /s/ MATTHEW THOMSON Title: THE BANK OF NOVA SCOTIA By: /s/ WERNER TILLINGER Title: BANCA COMMERCIALE ITALIANA, LOS ANGELES FOREIGN BRANCH By: /s/ RICHARD IWANICKI Title: SCHEDULE 2.01 COMMITMENTS AND PRO RATA SHARES Pro Rata Bank Commitment Share Bank of America National Trust and Savings Association $ 40,000,000 20.000% Royal Bank of Canada $ 25,000,000 12.500% Banque Nationale de Paris $ 25,000,000 12.500% NationsBank of Texas, N.A. $ 25,000,000 12.500% ABN AMRO Bank N.V., Los Angeles International Branch $ 25,000,000 12.500% The First National Bank of Chicago $ 10,000,000 5.000% Commerzbank Aktiengesellschaft, Los Angeles Branch $ 25,000,000 12.500% Banca Commerciale Italiana, Los Angeles Foreign Branch $ 10,000,000 5.000% The Bank of Nova Scotia $ 15,000,000 7.500% TOTAL $200,000,000 100.000% SCHEDULE 10.02 OFFSHORE AND DOMESTIC LENDING OFFICES, ADDRESSES FOR NOTICES BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent ADDRESS FOR NOTICES: Bank of America National Trust and Savings Association Agency Administration Services #5596 1455 Market Street, 13th Floor San Francisco, California 94103 Attention: Annie Cuenco Assistant Vice President Telephone: (415) 436-2775 Facsimile: (415) 436-2700 AGENT'S PAYMENT OFFICE: Bank of America National Trust and Savings Association Agency Management Services #5596 Attention: Agency Management Services #5596 1850 Gateway Boulevard Concord, California 94520 For credit to account: No. 12339-15104 Ref: AST Research BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as a Bank ADDRESS FOR NOTICES (OTHER THAN BORROWING NOTICES AND NOTICES OF CONVERSION/CONTINUATION): Bank of America NT&SA 555 California Street, 41st Floor Corporate Banking, High Technology Attention: Kevin McMahon Telephone: (415) 622-8088 Facsimile: (415) 622-4585/2514 ADDRESS FOR BORROWING NOTICES AND NOTICES OF CONVERSION/CONTINUATION): Bank of America National Trust and Savings Association 1850 Gateway Boulevard, Fourth Floor Concord, California 94520 BANQUE NATIONALE DE PARIS ADDRESS FOR NOTICES: Banque Nationale de Paris 725 South Figueroa Street, Ste. 2090 Los Angeles, California 90017-5420 Attention: Tjalling Terpstra Telephone: (213) 488-9120 Facsimile: (213) 488-9602 PAYMENT OFFICE: Banque Nationale de Paris/Treasury 180 Montgomery Street San Francisco, California 94104 Attention: Don Hart Vice President Telephone: (415) 956-2511 Facsimile: (415) 989-9041 ROYAL BANK OF CANADA ADDRESS FOR NOTICES: Royal Bank of Canada 600 Wilshire Blvd., Ste. 800 Los Angeles, California 90017 Attention: Michael Cole Telephone: (213) 955-5328 Facsimile: (213) 955-5350 PAYMENT OFFICE: Royal Bank of Canada 1 Financial Square, 23rd Floor New York, New York 10005-3531 Attention: Helen John Telephone: (212) 428-6322 Facsimile: (212) 428-2372 NATIONSBANK, N.A. ADDRESS FOR NOTICES: NationsBank, N.A. 901 Main Street 67th Floor Dallas, Texas 75202 Attention: Lori Stone Telephone: (214) 508-9419 Facsimile: (214) 508-0980 PAYMENT OFFICE: NationsBank, N.A. 901 Main Street Dallas, Texas 75202 Attention: Karin Puente Telephone: (214) 508-0519 Facsimile: (214) 508-0944 ABN AMRO BANK N.V., LOS ANGELES INTERNATIONAL BRANCH ADDRESS FOR NOTICES (OTHER THAN BORROWING NOTICES AND NOTICES OF CONTINUATION/CONVERSION): ABN AMRO Bank N.V., Los Angeles International Branch 300 South Grand Avenue, Suite 1115 Los Angeles, California 90071 Attention: Kenneth I. Bowman/John A. Miller Telephone: (213) 687-2057/2072 Facsimile: (213) 687-2061 PAYMENT OFFICE AND ADDRESS FOR BORROWING NOTICES AND NOTICES OF CONTINUATION/CONVERSION: ABN AMRO Bank N.V., Los Angeles International Branch 300 South Grand Avenue, Suite 1115 Los Angeles, California 90071 Attention: Carol Yi Telephone: (213) 687-2026 Facsimile: (213) 687-2085/2061 COMMERZBANK AKTIENGESELLSCHAFT, LOS ANGELES BRANCH ADDRESS FOR NOTICES: Commerzbank Aktiengesellschaft, Los Angeles Branch 660 Figueroa Stteet Suite 1450 Los Angeles, CA 90017 Attention: Steve Larson Telephone No.: (213) 623-8223 Facsimile No.: (213) 623-0039 Commerzbank Aktiengesellschaft, New York Branch 2 World Financial Center New York, New York 10281-1050 Attention: Andreas Schwung Telephone: (212) 266-7591 Facsimile: (212) 266-7530 PAYMENT OFFICE: Commerzbank Aktiengesellschaft, Los Angeles Branch 660 Figueroa Stteet Suite 1450 Los Angeles, CA 90017 Attention: Steve Larson Commerzbank Aktiengesellschaft, New York Branch 2 World Financial Center New York, New York 10281-1050 Attention: Andreas Schwung Telephone: (212) 266-7591 Facsimile: (212) 266-7530 THE FIRST NATIONAL BANK OF CHICAGO ADDRESS FOR NOTICES; The First National Bank of Chicago 153 West 51st Street, 8th Floor New York, New York 10019 Attention: J.W. Park Telephone: (212) 373-1033 Facsimile: (212) 373-1458 PAYMENT OFFICE: The First National Bank of Chicago One First National Plaza Chicago, Illinois 60670 Attention: Vic Perez Telephone: (312) 732-5948 Facsimile: (312) 732-4840 THE BANK OF NOVA SCOTIA ADDRESS FOR NOTICES: The Bank of Nova Scotia 580 California Street Suite 2100 San Francisco, CA 94119 Attention: Werner Tillinger Telephone: (415) 986-1100 Facsimile: (415) 397-0791 PAYMENT OFFICE: The Bank of Nova Scotia 600 Peachtree Street, Suite 2700 Atlanta, Georgia 30308 Attention: Michael Silveira Telephone: (404) 877-1522 Facsimile: (404) 888-8998 BANCA COMMERCIALE ITALIANA: ADDRESS FOR NOTICES: Banca Commerciale Italiana, Los Angeles Foreign Branch 555 South Flower Street Suite 4300 Los Angeles, CA 90071 Attention: Richard Iwanicki Telephone: (213) 624-0440 Facsimile: (213) 624-0457 PAYMENT OFFICE: Banca Commerciale Italiana, Los Angeles Foreign Branch 555 South Flower Street Suite 4300 Los Angeles, CA 90071 Attention: Richard Iwanicki Telephone: (213) 624-0440 Facsimile: (213) 624-0457 Annex 3 GUARANTOR ACKNOWLEDGMENT AND CONSENT The undersigned, the guarantor with respect to AST Research, Inc.'s (the "Company") obligations to the Agent and the Banks under the Credit Agreement dated as of December 20, 1995 (as amended prior to the date hereof, the "Prior Agreement"), hereby (a) acknowledges and consents to the execution, delivery and performance by Company of the Amended and Restated Credit Agreement dated as of December 17, 1996, a copy of which is attached hereto (the "Agreement"), (b) reaffirms and agrees that the Guaranty and all other documents and agreements executed and delivered by the undersigned to the Agent and the Banks in connection with the Prior Agreement and the Agreement are in full force and effect, without defense, offset or counterclaim and, (c) reaffirms and agrees that all of the provisions of the Guaranty are applicable to, and enforceable by the Agent and all Banks party to the Agreement against, the undersigned. The undersigned hereby represents and warrants to the Agent and the Banks on the date hereof and as of the Effective Date as follows: (i) the execution, delivery and performance by the undersigned of the Guaranty and this Guarantor Acknowledgment and Consent have been duly authorized by all necessary corporate and other action and do not and will not require any registration with, consent or approval or, notice to or action by , any Person (including any Governmental Authority) in order to be effective and enforceable, except as have been previously obtained and delivered to the Agent and the Banks; (ii) the Guaranty and this Guarantor Acknowledgment and Consent constitute the legal, valid and binding obligations of the undersigned, enforceable against it, in accordance with their respective terms, without defense, counterclaim or offset; (iii) all representations and warranties of the undersigned contained in the Guaranty are true and correct; and (iv) the undersigned is entering into this Guarantor Acknowledgment and Consent on the basis of its own investigations, and for its own reasons, without reliance upon the Agent, the Banks or any other Person. (v) it has requested that the Agent and the Banks enter into the Agreement notwithstanding that the Company may be deemed to be insolvent under applicable law and that such insolvency may adversely affect its liability under the Guaranty. Capitalized terms used herein have the meanings specified in the Agreement. SAMSUNG ELECTRONICS CO., LTD Dated: , 1996 By: /s/ KWANG HO KIM Title: Vice Chairman EX-99.7 8 FOR IMMEDIATE RELEASE Media Contact: Emory Epperson (714) 727-7958 Analyst Contact: Janine Whittington (714) 727-7780 AST INCREASES CREDIT LINE TO $300 MILLION; SELLS INTELLECTUAL PROPERTIES TO SAMSUNG FOR $10 MILLION IRVINE, Calif., Dec. 26, 1996 -- AST Research Inc. (ASTA-NASDAQ) today announced it has completed the previously-announced negotiation to increase its aggregate credit line to $300 million, and Samsung Electronics Co. has exercised its previously-announced option to buy a group of personal computer-related intellectual properties from AST. Samsung Electronics has agreed to pay $10 million for the intellectual properties. In increasing its aggregate credit lines to $300 million, AST renewed an existing $200 million credit line with a consortium of nine banks, led by Bank of America, and negotiated lines of credit in the aggregate amount of $100 million from Bank of America, ABN Amro N.V. and Societe Generale. The credit lines extend through late December 1997 and are guaranteed by Samsung. Funds from the credit lines will be used to repay the previously-announced $50 million short-term loan from Samsung. AST has sold a total of $25 million of PC-related intellectual property to Samsung in this year, including an June 1996 Intellectual Property Assignment Agreement for which AST received $15 million. Similar to those previously acquired by Samsung, the new intellectual property includes additional families of patent applications relating to a semiconductor chip design project that was ongoing at AST during 1994 and 1995, but was not eventually used by AST. As with those assigned in June 1996, AST obtained a license to those patent applications which were assigned to Samsung. AST Research Inc., a member of the Fortune 500 list of America's largest industrial and service companies, is one of the world's leading personal computer manufacturers. The $2.468 billion company develops a broad spectrum of desktop, mobile and server PC products that are sold in more than 100 countries worldwide. AST systems meet a wide range of customer needs, ranging from corporate business applications to advanced home and home office use. Corporate headquarters is located at 16215 Alton Parkway, P.O. Box 57005, Irvine, Calif. 92619-7005. Telephone (714) 727-4141 or (800) 876-4278. Fax: (714) 727-9355. Information about AST and its products can be found on the World Wide Web at http://www.ast.com. # # # EX-99.8 9 FIRST INTELLECTUAL PROPERTY OPTION EXERCISE THIS FIRST INTELLECTUAL PROPERTY OPTION EXERCISE ("FIRST OPTION EXERCISE") is made as of December 17, 1996, and is made pursuant to the Intellectual Property Assignment Agreement ("Agreement") which was made as of June 27, 1996 by and between AST Research, Inc., a Delaware, USA corporation ("AST"), and Samsung Electronics Company Limited, a Korean corporation ("SEC"). PURPOSE AST and SEC made the prior Agreement for the sale of certain intellectual properties in the form of patent applications filed in the United States and counterpart international patent applications therefor. Besides transferring ownership of certain intellectual properties from AST to SEC, the Agreement also provided an option for the sale of optional intellectual properties, in one or more installments, with the price to be agreed by SEC and AST. SEC wishes to purchase a first group of the optional intellectual properties, and SEC and AST have reached an agreement on the price. AST is to assign the first group of optional intellectual properties to SEC, SEC is to pay the agreed price to AST, with SEC retaining an option to purchase some or all of the remaining optional intellectual properties which were not included in the first group of optional intellectual properties. AGREEMENT ARTICLE L. DEFINITIONS 1.1 The terms as used in this First Option Exercise shall, unless the context clearly indicates to the contrary, have the meanings set forth in this Article 1. In addition, the definitions included in the Agreement are incorporated by reference, as if set forth herein. 1.2 "FIRST EXERCISE EFFECTIVE DATE" means December 17, 1996. 1.3 "FIRST GROUP OF OPTIONAL INTELLECTUAL PROPERTIES" means the United States patent applications entitled "High Impedance Test Mode for JTAG," US patent application number 08/574,593 filed December 19, 1995, and "Queue Management Mechanism Which Allows Entries to be Processed in Any Order," US patent application number 08/414,948 filed March 31, 1995, and "Method and Apparatus for Testing a Megacell in an ASIC Using JTAG," US patent application number 08/480,483 filed June 7, 1995 (now abandoned), and "Method and Apparatus for Testing a Megacell in an ASIC Using JTAG," US patent application number 08/528,397 filed September 14, 1995, and "JTAG Testing of Buses Using Plug-In Cards with JTAG Logic Mounted Thereon," US patent application number 08/569,751 filed December 8, 1995, and "Memory Controller Which Executes Read and Write Commands Out of Order," US patent application number 08/415,038 filed March 31, 1995, and any patents that may issue based on such applications, and the international counterpart applications based on such applications, if any. 1.4 "FIRST REMAINING OPTIONAL INTELLECTUAL PROPERTIES" means the United States patent applications entitled "Method and Apparatus for Reducing Cumulative Time Delay in Synchronizing Transfer of Buffered Data Between Two Mutually Asynchronous Buses," US patent application 08/483,505 filed June 7, 1995 (now abandoned), and "Method and Apparatus for Reducing Cumulative Time Delay in Synchronizing Transfer of Buffered Data Between Two Mutually Asynchronous Buses," US patent application 08/510,545 filed August 2, 1995, and "JTAG Toggle Test Method," US patent application number 08/596,043 filed February 6, 1996, and "Method and Apparatus for Determining the Status of a Shared Resource," US patent application number 08/568,149 filed December 7, 1995, and "Glitch Free Clock-Enable Circuit," US patent application number 08/485,477 filed June 7, 1995 which issued as US Patent No. 5,537,062 on July 16, 1996, and "Glitch Free Clock-Enable Circuit," US patent application number 08/679,574, filed on July 15, 1996 (continuation of US patent application number 08/414,948), and any patents that may issue based on such applications, and the international counterpart applications based on such applications, if any. ARTICLE 2. SALE OF INTELLECTUAL PROPERTIES 2.1 First Group of Optional Intellectual Properties. AST hereby assigns to SEC all rights, title and interest in and to the First Group of Optional Intellectual Properties. SEC and AST agree that this First Option Exercise shall be effective as the written notice described in Section 2.2 of the Agreement. 2.2 First Remaining Optional Intellectual Properties. SEC shall continue to have the same option, exercisable at any time between December 17, 1996 and December 20, 1996, to acquire from AST the First Remaining Optional Intellectual Properties for the price which may be later agreed upon by AST and SEC, as stated in Section 2.2 of the Agreement, but SEC shall not be obligated to exercise its option to purchase any of the First Remaining Optional Intellectual Properties. ARTICLE 3. PAYMENT 3.1 First Group Fee. SEC agrees to pay to AST the amount listed in Appendix A on the date specified in Appendix A in exchange for the transfer and assignment to SEC of the First Group of Optional Intellectual Properties. The total of the fee for the transfer and assignment of the First Group of Optional Intellectual Properties shall be ten million United States dollars (US$ 10,000,000.00). 3.2 Payment Schedule. SEC agrees to pay to AST the amounts listed in Appendix A on the dates specified in Appendix A in exchange for the transfer and assignment to SEC of the First Group of Optional Intellectual Properties which are acquired by SEC pursuant to this Agreement. Payment of ten million United States dollars (US$ 10,000,000.00) shall be due for the First Group of Optional Intellectual Properties on the First Exercise Effective Date, and payable within 45 days of the First Exercise Effective Date. ARTICLE 4. RELATIONSHIP TO THE AGREEMENT This First Option Exercise shall not amend or cancel any of the terms or provisions of the Agreement. The First Group of Optional Intellectual Properties shall be deemed to be acquired by SEC under the Agreement, such acquisition being effective on the First Exercise Effective Date. IN WITNESS WHEREOF, the parties have caused their duly authorized representatives to execute this First Option Exercise, on the dates below indicated. SAMSUNG ELECTRONICS CO., LTD. AST RESEARCH, INC. By: /s/ HYEON-GON KIM By: /s/ WON YANG Name: Hyeon-Gon Kim Name: Won Yang Title: Executive Vice President Title: Senior Vice President, Acting Chief Financial Officer Date: Dec. 17, 1996 Date: Dec. 17, 1996 APPENDIX A: PAYMENT SCHEDULE The payment terms shall be net 45 days from the First Exercise Effective Date. Terms Payment Net 45 days US $10 million for the First Group of Optional Intellectual Properties. -----END PRIVACY-ENHANCED MESSAGE-----