-----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, QgwnWZAkJAvZ6tiBmQ1jVF9fXN4C7wML2gaXXA4xY5CzKrvH3iZ74mh9lwqGAlpY 6Amk+eNroTSfICg+yhCVww== 0000725182-95-000045.txt : 19951226 0000725182-95-000045.hdr.sgml : 19951226 ACCESSION NUMBER: 0000725182-95-000045 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19951222 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19951222 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: 95604172 BUSINESS ADDRESS: STREET 1: 16215 ALTON PKWY CITY: IRVINE STATE: CA ZIP: 92718 BUSINESS PHONE: 7147274141 8-K 1 FORM 8-K DATED 12/22/95 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 22, 1995 (DECEMBER 21, 1995) 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 21, 1995, AST Research, Inc. (the "Company") announced that it signed an agreement with Samsung Electronics Co. Ltd. ("Samsung") that will provide additional financial support to the Company as consideration for an option to purchase 4.4 million shares of the Company's Common Stock at an exercise price of $.01 per share, exercisable after June 30, 1996, and expiring June 30, 2001. The additional financial support includes the following: * A guaranty of a bank line or lines of credit of up to $200 million through December 31, 1997. * A vendor line of credit with Samsung of $100 million through November 30, 1997 for purchases of components. Samsung may also provide certain other elements of support of up to $50 million in a form which could include, among others, component discounts, joint development, and/or technology transfers. The form and ultimate amount of such additional support is at the sole and absolute discretion of and is not binding upon Samsung. A copy of the press release is attached to this report as Exhibit 99.1, and is incorporated herein by this reference. A copy of the Additional Support Agreement, Amendment No. 1 to Stockholder Agreement, the Amended Bylaws of AST Research, Inc., and a Letter from Samsung dated December 21, 1995, are attached to this report as Exhibits 99.2 to 99.5, respectively, and are incorporated herein by this reference. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS Exhibit Number Description 99.1 Press release issued by the Registrant on December 21, 1995, announcing that the Company reached an agreement with Samsung for significant additional support in its turnaround efforts. 99.2 Additional Support Agreement dated December 21, 1995. 99.3 Amendment No. 1 to Stockholder Agreement. 99.4 Amended Bylaws of AST Research, Inc. 99.5 Letter from Samsung dated December 21, 1995. 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 DENNIS R. LEIBEL Senior Vice President, Legal, Administration and Secretary Date: December 22, 1995 EX-99.1 2 FOR IMMEDIATE RELEASE Media Contact: Emory Epperson (714) 727-7958 Analyst Contact: Janine Whittington (714) 727-7780 AST REACHES AGREEMENT WITH SAMSUNG ELECTRONICS FOR SIGNIFICANT ADDITIONAL SUPPORT IN TURNAROUND EFFORTS IRVINE, Calif., Dec. 21, 1995 -- AST Research Inc. (ASTA-NASDAQ) today announced it has reached final agreement with Samsung Electronics that will provide significant support to AST, including credit and vendor benefits that are more favorable to AST than those originally contemplated by the letter of intent previously reported. Included under terms of the agreement is a bank credit guarantee of up to $200 million for two years, as well as a $100 million vendor credit line for component purchases from Samsung. A portion of the bank credit to be guaranteed by Samsung will be used to pay off the $50 million short-term loan recently made to AST by Samsung. "By significantly increasing the support levels originally outlined in the letter of intent, this agreement takes our strategic partnership with Samsung to the next level," said Ian Diery, AST president and chief executive officer. "It not only enhances our competitive position and business prospects by providing financial flexibility as we move forward on our turnaround plan, it also strengthens the bond between our companies in terms of component supply and technology sharing, which are essential elements we can leverage to provide long-term benefits and product differentiation for our customers." In consideration for this support and subject to Samsung fulfilling its obligations under the support arrangements, AST will grant Samsung a five-year option to purchase up to 4.4 million shares of AST common stock at one-cent per share, excercisable beginning on July 1, 1996. If the option is excercised in full, Samsung's ownership position would increase to approximately 45 percent, from its present position of approximately 40 percent. An additional Samsung- designated director also will be appointed to the AST board, allowing Samsung- designated directors to comprise a majority representation. In addition, certain amendments were made to the existing Stockholder Agreement with Samsung, consistent with the foregoing board representation, as well as modifications to the restrictions on Samsung's share ownership and disposition. Samsung also has expressed a willingness to provide additional support to AST in the areas of component supply, joint development, technology transfers and/or other PC-related items, although there are no binding arrangements with respect to such support. The letter of intent announced by AST on Nov. 2 has been superseded by these arrangements. CORPORATE BACKGROUND 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-99.2 3 ADDITIONAL SUPPORT AGREEMENT This Additional Support Agreement (the "Agreement") is entered into as of December 22, 1995 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. B. As a result of the transactions contemplated by the Stock Purchase Agreement, SEC is a significant stockholder of AST. C. SEC and AST entered into that certain Stockholder Agreement dated as of July 31, 1995 (the "Stockholder Agreement") pursuant to which certain terms and conditions were established concerning SEC's investment in AST and AST's corporate governance. D. In addition to the Stock Purchase Agreement and the Stockholder Agreement, SEC and AST entered into that certain Strategic Alliance Agreement dated February 27, 1995 and certain other agreements that were intended to enhance the business prospects and competitive position of AST. 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 Stock Option 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 COMPONENT SUPPLY CREDIT LINE 1.1 Component Sales. SEC represents to AST that it has complied in all material respects with the first sentence of Article 3 of that certain Component Sales Agreement dated as of July 31, 1995 by and between SEC and AST (the "Component Sales Agreement"). SEC and AST shall continue to have their respective rights and obligations under the Component Sales Agreement,, including rights and obligations regarding the purchase and sale of display monitors, liquid crystal display panels, CD-ROM drives, hard disk drives, static, video and dynamic random access memory, and other items which exist now or may be developed in the future (the "Products"). As set forth in the Component Sales Agreement, AST and its Subsidiaries ("Ordering Entity") may submit purchase orders directly to SEC for Products and SEC shall supply same to Ordering Entity pursuant to the terms and conditions of this Agreement and the Component Sales Agreement (in the event of a conflict or inconsistency between any terms or conditions of this Agreement and the Component Sales Agreement, the terms and conditions of this Agreement shall supersede and control). No term or condition set forth in any purchase order submitted to SEC by an Ordering Entity shall modify the terms and conditions of this Agreement or the Component Sales Agreement. 1.2 Extended Vendor Credit Limit. As set forth in the Component Sales Agreement, SEC shall provide AST pricing and terms which, when considered in the aggregate, are at least as favorable as those offered by SEC to its most favored customer group. Notwithstanding such terms, until November 30, 1997, but subject to the provisions of Section 1.3 below, SEC shall extend vendor credit to AST of up to $100 million outstanding at any given time on terms as described in Schedule 1.2, which the parties agree shall be treated as confidential. 1.3 Termination of Extended Credit Limit. SEC's obligations under Section 1.2 above shall terminate and be of no further force and effect if any of the following events shall occur: (a) Termination of Component Sales Agreement. The Component Sales Agreement shall have been terminated in accordance with its terms (including the provisions of the General Terms Agreement dated as of July 31, 1995 between the parties which forms a part of the Component Sales Agreement). (b) Failure to Achieve Turnaround Plan. At the election of SEC, upon written notice to AST, if AST fails to achieve for any quarter of fiscal year 1996 at least eighty-five (85%) of the sales objectives set forth in AST's Fiscal Year 1996 Turnaround Plan previously provided to SEC and attached to the resolutions presented to AST's Board of Directors in connection with its consideration of this Agreement. ARTICLE 2 GUARANTY 2.1 Line of Credit Guaranty. SEC shall, as promptly as practicable after receipt of a request from AST, execute and deliver one or more guaranties(the "Guaranty") of a bank line or lines of credit for the benefit of AST in an aggregate amount not to exceed $200 million outstanding at any one time; provided, however, that the obligation to provide such Guaranty shall not extend beyond December 31, 1997, and provided further that the terms of such line or lines of credit and Guaranty shall not differ materially from the forms of Credit Agreement and Guaranty attached hereto as Exhibit 2.1 without SEC's prior approval, which approval may be given or withheld by SEC in its sole and absolute discretion. ARTICLE 3 STOCK OPTION 3.1 Grant of Stock Option. AST hereby grants to SEC an irrevocable option (the "Stock Option") to purchase up to 4,400,000 shares of AST Common Stock (the "Option Shares") at a purchase price of one cent ($.01) per Option Share (the "Purchase Price"). SEC may assign the Stock Option in whole or part to any of SEC's wholly-owned or majority-owned subsidiaries. 3.2 Exercise of Stock Option. (a) The Stock Option may be exercised in whole or in part at any time or from time to time after June 30, 1996; provided, however, that the Stock Option may not be exercised at any time that SEC is in material breach of its obligation to provide vendor credit under the second sentence of Section 1.2 of this Agreement or its obligations under Section 2.1 of this Agreement, and provided further that the Stock Option shall terminate, to the extent not theretofore exercised, at 11:59 p.m. on June 30, 2001. (b) In the event SEC or any permitted assignee wishes to exercise the Stock Option, SEC or such assignee shall send a written notice (an "Exercise Notice") to AST specifying the total number of Option Shares SEC or such assignee wishes to purchase, the denominations of the certificate or certificates evidencing such Option Shares which SEC or such assignee wishes to receive, a date which shall be a business day which is at least five business days after delivery of such notice, and the place for the closing of such purchase (a "Closing"), which place will be in Orange County, California. SEC may, in its discretion upon its exercise of the Stock Option, have any Option Shares issued in the name of any of its wholly-owned or majority-owned subsidiaries. (c) Upon receipt of an Exercise Notice, AST shall be obligated to deliver to SEC or SEC's permitted assignee a certificate or certificates evidencing the number of Option Shares specified therein, in accordance with the terms of this Agreement, on the later of (i) the date specified in such Exercise Notice and (ii) the first business day on which the conditions specified in Section 3.3 shall be satisfied. 3.3 Conditions to Delivery of Option Shares. The obligation of AST to deliver Option Shares upon any exercise of the Stock Option 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 is at the time listed or quoted) applicable to such exercise of the Stock Option and the delivery of the Option Shares; (b) There shall be no preliminary or permanent injunction or other order by any court of competent jurisdiction preventing or prohibiting such exercise of the Stock Option or the delivery of the Option Shares in respect of such exercise; and (c) The party exercising the Stock Option shall have represented to AST that such exercise is in material compliance with all applicable Korean governmental laws and regulations. 3.4 Closings. At each Closing, AST will deliver to SEC a certificate or certificates evidencing the number of Option Shares specified in the applicable Exercise Notice (in the denominations specified therein), and SEC will purchase such Option Shares from AST at the Purchase Price. All payments made by SEC to AST pursuant to this Section 3.4 shall be made, at the option of SEC, either (a) by wire transfer of immediately available United States funds in the amount of the aggregate Purchase Price for the Option Shares being purchased, or (b) by delivery to AST of a certified or bank check or checks payable in the United States to or on the order of AST in an amount equal to the aggregate Purchase Price. 3.5 Adjustments Upon Share Issuances, Changes in Capitalization, etc. (a) In the event of any change in the capitalization of AST or in the number of outstanding shares of AST by reason of a stock dividend, split- up, recapitalization, reclassification, combination, exchange of shares or similar transaction, or any other change in the corporate or capital structure of AST (including, without limitation, the declaration or payment of an extraordinary dividend in cash, securities or other property), the type and number of shares or securities to be issued by AST upon exercise of the Stock Option shall be adjusted appropriately, and proper provision shall be made in the agreements governing such transaction, so that SEC shall receive upon exercise of the Stock Option the number and class of shares or other securities or property that SEC would have received if the Stock Option had been exercised immediately prior to such event, or the record date therefor, as applicable, and elected to the fullest extent it would have been permitted to elect, to receive such securities, cash or other property. (b) In the event that AST shall enter into an agreement (i) to consolidate with or merge into any person, and AST shall not be the continuing or surviving corporation of such consolidation or merger, (ii) to permit any person to merge into AST and AST shall be the continuing or surviving corporation, but, in connection with such merger, the then outstanding shares of AST shall be changed into or exchanged for stock or other securities of AST or any other person or into cash or any other property, or the outstanding shares of AST shall after such merger represent less than 50% of the outstanding shares and share equivalents of the surviving corporation or (iii) to sell or otherwise transfer all or substantially all of its assets to any person in a single transaction or series of related transactions, and, in connection with such sale or transfer the outstanding shares of AST shall be changed into or exchanged for stock or other securities of AST or any other person or into cash or any other property; then in any such case, proper provision shall be made in the agreements governing such transaction so that SEC shall receive upon exercise of the Stock Option the number and class of shares or other securities or property that SEC would have received if the Stock Option had been exercised immediately prior to such transaction, or the record date therefor, as applicable, and elected to the fullest extent it would have been permitted to elect, to receive such securities, cash or other property. 3.6 Investment Intent. SEC represents and warrants to AST that the Option Shares 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 shares. SEC understands that the Option Shares 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. 3.7 Sophistication. SEC represents and warrants to AST that SEC is able to bear the economic risk of an investment in the Option Shares 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 Option Shares. ARTICLE 4 REPRESENTATIONS 4.1 Representations. 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 5 MISCELLANEOUS 5.1 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 5.3. 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. 5.2 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. 5.3 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. 5.4 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. 5.5 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. In addition, subject to compliance with all applicable securities laws, SEC shall have the right to transfer any unexercised Stock Options to underwriters or brokers in connection with an offering by such underwriters or brokers of the Stock Options or the underlying Option Shares in transactions which comply with the provisions of Section 3.3 of the Stockholder Agreement. 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. 5.6 Entire Agreement. This Agreement, together with the Component Sales Agreement and the General Terms Agreement, constitutes the entire agreement between SEC and AST with respect to the subject matter hereof and thereof and the transactions contemplated hereby and thereby and supersedes all prior or contemporaneous, written or oral agreements or understandings with respect thereto (including without limitation all term sheets). In the event of a conflict or inconsistency between any terms or conditions of this Agreement and such other agreements, the terms and conditions of this Agreement shall supersede and control. The parties acknowledge that their agreements hereunder and thereunder were not procured through representations or agreements not set forth herein or therein. 5.7 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. 5.8 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. 5.9 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. 5.10 Headings; References. Headings used in this Agreement are inserted as a matter of convenience and for reference, do not constitute a part of this Agreement for any other purpose, and shall not affect the interpretation or enforcement hereof or thereof. References herein or therein to Sections, Schedules, and Exhibits are, unless otherwise designated, references to the specified Section, Schedule or Exhibit hereof or hereto. 5.11 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: Ian Diery By: Won Suk Yang Title: President and Chief Title: Senior Executive Executive Officer Managing Director EX-99.3 4 AMENDMENT NO. 1 TO STOCKHOLDER AGREEMENT This Amendment No. 1 (the "Amendment") to Stockholder Agreement, dated as of July 31, 1995 (the "Stockholder Agreement"), is entered into as of December 21,1995 by and between Samsung Electronics Co., Ltd., a Korean corporation (the "Purchaser") and AST Research, Inc., a Delaware corporation (the "Company"). Capitalized terms used in this Amendment and not otherwise defined herein shall have the meanings ascribed to them in the Stockholder Agreement. A. As a result of the consummation of the transactions contemplated by that certain Stock Purchase Agreement dated as of February 27, 1995 between the Purchaser and the Company (the "Stock Purchase Agreement"), the Purchaser became a significant stockholder of the Company. B. As contemplated by the Strategic Alliance Agreement dated concurrently with the Stock Purchase Agreement, the Purchaser and the Company have entered into certain commercial agreements. C. The Company has requested the Purchaser to extend substantial credit terms to the Company in respect of purchases of components by the Company from the Purchaser and has also requested that the Purchaser guarantee on behalf of the Company a substantial line of credit, and as a result of such requests the parties have entered into that certain Additional Support Agreement of even date herewith (the "Additional Support Agreement"). D. It is a condition to the transactions contemplated by the Additional Support Agreement that the Stockholder Agreement be amended as set forth in this Amendment. NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Stockholder Agreement is hereby amended as follows: 1. The following definitions in Article 1 are hereby amended to read in full as follows: "INDEPENDENT DIRECTOR" means a Director who is not currently (apart from such directorship) an Affiliate, officer, director, employee, agent, principal stockholder, consultant or partner of the Purchaser or the Company or any Affiliate of either of them or of any entity that was dependent on the Purchaser or the Company 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 the Purchaser or the Company 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 the Purchaser or the Company or any of their respective Affiliates so as to be reasonably likely to cause such person to have any interest in any transaction with the Purchaser or the Company or any of their respective Affiliates. "STANDSTILL PERIOD" means the period commencing on July 31, 1995 and ending on the date on which the first of the following events occurs: (i) December 15, 1998, (ii) such date as an amendment to Section 3.9 of the Indenture dated as of December 1, 1993 between AST and First Trust National Association relating to the LYONs (the "Indenture") shall be executed to exempt from the definition of "Change in Control" the acquisition by the Purchaser and/or its Affiliates of 50% or more of the then outstanding shares of Common Stock or (iii) such date as the closing price for the Common Stock in the principal market where the Common Stock is listed or quoted shall have been, for any 20 of 30 consecutive trading days, at least equal to 140% of the quotient obtained by dividing (a) the Issue Price of a LYON, plus Accrued Original Discount, by (b) the Conversion Rate (as all of such terms are defined in the Indenture). 2. Section 2.1.2 is amended to read in full as follows: "2.1.2. Open Market. The Purchaser and/or its Affiliates may purchase Shares in the open market." 3. Subsection (b) of Section 2.1.7 is amended to read in full as follows: "(b) has been approved by a majority of the Independent Directors and would result in the Purchaser and/or its Affiliates owning 100% of the Voting Stock." 4. Section 3.1 is amended to read in full as follows: "3.1. PRO-RATA TRANSACTIONS. The Purchaser and/or any of its Affiliates may sell any or all Equity Securities Beneficially Owned by such persons in any transaction or transactions in which each other holder of Equity Securities has the opportunity to sell the same percentage of such stockholder's Equity Securities as the Purchaser and such Affiliates, at a price and on terms no less favorable than those applicable to the sale by the Purchaser and/or its Affiliates." 5. Section 3.2 is amended to read in full as follows: "3.2. PUBLIC OFFERINGS AND MARKET TRANSACTIONS. The Purchaser and/or any of its Affiliates may sell any or all Equity Securities Beneficially Owned by such persons in one or more registered public offerings or in market transactions if the Purchaser and/or its selling Affiliates invoke and follow or require participating underwriters or brokers to invoke and follow appropriate and reasonable procedures (subject to the Company's prior approval, which shall not be unreasonably withheld) designed to prevent the sale of such Equity Securities to any person or "group" (within the meaning of Section 13(d)(3) of the Exchange Act) that would, after giving effect to its acquisition of such Equity Securities, Beneficially Own or have the right to acquire more than ten percent (10%) of the Total Voting Power." 6. Section 3.3 is amended to read in full as follows: "3.3. DIRECTORS' APPROVAL. The Purchaser and/or any of its Affiliates may sell any or all Equity Securities Beneficially Owned by such persons in any transaction or transactions approved by a majority of the Independent Directors." 7. During such time as the Purchaser Interest (calculated as provided for in Section 2.1.7 of the Stockholder Agreement) shall be at least 40%, Article 4 shall be amended to read in full as set forth below. At such time as the Purchaser Interest shall have been less than 40% for a period of at least twenty-five (25) consecutive days after the date of this Amendment, the below amendment to Article 4 shall be rescinded and Article 4 shall be restored to read in full as now set forth in the Agreement. Subject to the foregoing, Article 4 is amended to read in full as follows: "ARTICLE 4. BOARD REPRESENTATION 4.1 INDEPENDENT DIRECTORS. At all times until such time as the Purchaser Interest shall have been less than the 30% for a period of at least twenty-five (25) consecutive days, or more than 90% for a period of at least twenty-five (25) consecutive days, the Board shall include at least three Independent Directors, and at least one Independent Director shall be designated to serve on each committee of the Board. Subject to the foregoing requirement and applicable law, including antitrust law, the Purchaser shall be entitled to nominate, seek the election of and vote any Voting Stock owned by it or its Affiliates for such Directors as the Purchaser shall determine in its sole discretion. 4.2 PURCHASER DESIGNEES. Names of all Director nominees designated by the Purchaser pursuant to the last sentence of Section 4.1 above shall be furnished to the Company (a) in the case of election of Directors at an annual meeting or otherwise pursuant to a vote of the Company's stockholders, in time to be included in the proxy materials related to such election, and (b) at least ten (10) days prior to election or appointment of Directors by the Board. 4.3 DIRECTORS' INDEMNIFICATION AND INSURANCE. As long as any designees of the Purchaser serve on the Board, (a) the Amended and Restated Certificate of Incorporation and Bylaws of the Company shall not be amended to contain provisions less favorable with respect to indemnification and limitation of liability of Directors than are set forth in the Amended and Restated Certificate and Amended Bylaws as of the date of this Amendment, or in any other manner that would affect adversely the rights thereunder of designees of the Purchaser serving on the Board, unless such amendment, repeal or modification shall be required by law or the fiduciary obligations of the Board, as determined in good faith by the Board based on the written advice of outside counsel, and (b) such designees shall be covered by any directors' and officers' liability insurance maintained from time to time on the same terms and subject to the same conditions as the other members of the Board, and (c) such designees shall be entitled to the benefit of any indemnification agreements entered into by the Company with any of its Directors; provided, that nothing in this Amendment shall obligate the Company to maintain any such insurance or to enter into any such indemnification agreements. 4.4 DIRECTORS' COMPENSATION. The Directors designated by the Purchaser, if any, who are not officers or employees of the Purchaser and its Affiliates shall have the right to receive all fees paid and options and other awards granted and expenses reimbursed to non-employee Directors generally, provided that all such fees and awards allocable to Directors who are not officers or employees of the Purchaser and its Affiliates shall not be paid or awarded or transferred to the Purchaser. Directors designated by the Purchaser who are officers or employees of the Purchaser or its Affiliates shall have the right to receive only such fees, options and other awards and expense reimbursements, if any, as may be granted to employee Directors of the Company for their service as Directors, provided that, notwithstanding Article 2 (other than Section 2.1.7), any or all such fees and awards allocable to Directors designated by the Purchaser shall, in the Purchaser's discretion, be paid or awarded to the Purchaser. 8. Article 6 is amended by deleting therefrom in their entirety Sections 6.1 and 6.2 and renumbering Section 6.3 to become Section 6.1. In addition, the reference to "Section 6.3" in the second sentence of renumbered Section 6.1 shall be amended to refer to "Section 6.1," and the reference to Section 6.1 in the parenthetical contained in clause (ii) of said second sentence shall be deleted. 9. Article 7 is hereby deleted in its entirety. 10. Except as set forth in this Amendment, the provisions of the Stockholder Agreement shall remain in full force and effect, and all references to the Stockholder Agreement in any other agreements between the parties shall be deemed to refer to and mean the Stockholder Agreement, as amended by this Amendment. 11. This Amendment 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 Amendment as of the date first above written. AST RESEARCH, INC. By: Ian Diery Title: President and Chief Executive Officer SAMSUNG ELECTRONICS CO., LTD. By: Won Suk Yang Title: Senior Executive Managing Director EX-99.4 5 BYLAWS OF AST RESEARCH, INC. A DELAWARE CORPORATION (AS AMENDED, THROUGH DECEMBER 21, 1995) TABLE OF CONTENTS ARTICLE I. OFFICES 1 Section 1. Registered Office 1 Section 2. Other Offices 1 Section 3. Books 1 ARTICLE II. MEETINGS OF STOCKHOLDERS 1 Section 1. Place of Meetings 1 Section 2. Annual Meetings 1 Section 3. Special Meetings 1 Section 4. Notification of Business to be Transacted at Meeting 1 Section 5. Notice; Waiver of Notice 2 Section 6. Quorum; Adjournment 2 Section 7. Voting 2 Section 8. Stockholder Action by Written Consent Without a Meeting 2 Section 9. List of Stockholders Entitled to Vote 2 Section 10. Stock Ledger 3 Section 11. Inspectors of Election 3 Section 12. Organization 3 Section 13. Order of Business 3 ARTICLE III. DIRECTORS 3 Section 1. Powers 3 Section 2. Number and Election of Directors 3 Section 3. Vacancies 3 Section 4. Time and Place of Meetings 4 Section 5. Annual Meeting 4 Section 6. Regular Meetings 4 Section 7. Special Meetings 4 Section 8. Quorum; Vote Required for Action; Adjournment 4 Section 9. Action by Written Consent 5 Section 10. Telephone Meetings 5 Section 11. Committees 5 Section 12. Compensation 5 Section 13. Interested Directors 5 ARTICLE IV. OFFICERS 6 Section 1. Executive Officers 6 Section 2. Election; Term of Office and Remuneration 6 Section 3. Subordinate Officers 6 Section 4. Removal 6 Section 5. Resignations 6 Section 6. Powers and Duties 7 ARTICLE V. STOCK 7 Section 1. Form of Certificates 7 Section 2. Signatures 7 Section 3. Lost Certificates 7 Section 4. Transfers 7 Section 5. Registered Owners 7 ARTICLE VI. LIMITATION OF LIABILITY 8 ARTICLE VII. INDEMNIFICATION 8 Section 1. Action Other Than by or in the Right of the Corporation 8 Section 2. Action by or in the Right of \ the Corporation 8 Section 3. Determination of Right of Indemnification 8 Section 4. Indemnification Against Expenses of Successful Party 9 Section 5. Advances of Expenses 9 Section 6. Right of Agent to Indemnification upon Application; Procedure Upon Application 9 Section 7. Other Rights and Remedies 9 Section 8. Insurance 10 Section 9. Indemnity Fund 10 Section 10. Constituent Corporations 10 Section 11. Other Enterprises, Fines, and Serving at Corporation's Request 10 Section 12. Indemnification of Other Persons 10 Section 13. Savings Clause 10 ARTICLE VIII. RECORDS 11 Section 1. Maintenance and Inspection of Share Register 11 Section 2. Maintenance and Inspection of Bylaws 11 ARTICLE IX. GENERAL PROVISIONS 11 Section 1. Dividends 11 Section 2. Disbursements 11 Section 3. Fiscal Year 11 Section 4. Corporate Seal 11 Section 5. Record Date 12 Section 6. Voting of Stock Owned by the Corporation 12 Section 7. Construction and Definitions 12 Section 8. Amendments 12 ARTICLE X. AUTOMATIC AMENDMENT PURSUANT TO STOCKHOLDER AGREEMENT 12 BYLAWS OF AST RESEARCH, INC. A DELAWARE CORPORATION ARTICLE I OFFICES Section 1. Registered Office. The address of the registered office of the Corporation in the State of Delaware shall be 1209 Orange Street, Wilmington, New Castle County, Delaware, 19801, and the name of its registered agent at such address is The Corporation Trust Company. Section 2. Other Offices. The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require. Section 3. Books. The books of the Corporation may be kept within or without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require. ARTICLE II MEETINGS OF STOCKHOLDERS Section 1. Place of Meetings. All meetings of the stockholders shall be held at such place either within or without the State of Delaware and on such date and at such time as may be designated from time to time by the Board of Directors. If the Board of Directors shall fail to fix such place, the meetings shall be held at the principal executive office of the Corporation. Section 2. Annual Meetings. Annual meetings of stockholders shall be held at a time and date designated by the Board of Directors for the purpose of electing directors and transacting such other business as may properly be brought before the meeting. Section 3. Special Meetings. Special meetings of stockholders, for any purpose or purposes, may be called by the Board of Directors, the Chairman of the Board of Directors, the President, or the holders of shares entitled to cast not less than a majority of the votes at such meeting. Special meetings may not be called by any other person. Section 4. Notification of Business to be Transacted at Meeting. To be properly brought before a meeting, business must be (a) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (b) otherwise properly brought before the meeting by or at the direction of the Board of Directors, or (c) otherwise properly brought before the meeting by a stockholder entitled to vote at the meeting. Section 5. Notice; Waiver of Notice. Whenever stockholders are required or permitted to take action at a meeting, a written notice of the meeting shall be given which shall state the place, date and hour of the meeting, and, in the case of a special meeting, the purpose for which the meeting is called. Unless otherwise required by law, such notice shall be given not less than ten nor more than 60 days before the date of the meeting to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the Corporation. A written waiver of any such notice signed by the person entitled thereto, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Section 6. Quorum; Adjournment. Except as otherwise required by law or provided by the Certificate of Incorporation, the holders of a majority of the capital stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of the stockholders. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting of the time and place of the adjourned meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally noticed. If after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder entitled to vote at the meeting. Section 7. Voting. Except as otherwise required by law, or provided by the Certificate of Incorporation or these Bylaws, any question brought before any meeting of stockholders shall be decided by the vote of the holders of a majority of the stock represented and entitled to vote thereat. Unless otherwise provided in the Certificate of Incorporation, each stockholder represented at a meeting of stockholders shall be entitled to cast one vote for each share of the capital stock entitled to vote thereat held by such stockholder. Such votes may be cast in person or by proxy, but no proxy shall be voted on or after three years from its date, unless such proxy provides for a longer period. Elections of directors need not be by ballot unless the Chairman of the meeting so directs or unless a stockholder demands election by ballot at the meeting and before the voting begins. Section 8. Stockholder Action by Written Consent Without a Meeting. Any action which may be taken at any annual or special meeting of stockholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, is signed by the holders of all of the outstanding shares of the Corporation. All such consents shall be filed with the Secretary of the Corporation and shall be maintained in the corporate records. Any stockholder giving a written consent, or the stockholder's proxy holders, or a transferee of the shares or a personal representative of the stockholder or their respective proxy holders, may revoke the consent by a writing received by the Secretary of the Corporation before written consents of the number of shares required to authorize the proposed action have been filed with the Secretary. Section 9. List of Stockholders Entitled to Vote. The officer who has charge of the stock ledger of the Corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder of the Corporation who is present. Section 10. Stock Ledger. The stock ledger of the Corporation shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by Section 9 of this Article II or the books of the Corporation, or to vote in person or by proxy at any meeting of stockholders. Section 11. Inspectors of Election. In advance of any meeting of stockholders, the Board of Directors may appoint one or more persons (who shall not be candidates for office) as inspectors of election to act at the meeting. If inspectors are not so appointed, or if an appointed inspector fails to appear or fails or refuses to act at a meeting, the Chairman of any meeting of stockholders may, and on the request of any stockholder or his proxy shall, appoint inspectors of election at the meeting. In the event of any dispute between or among the inspectors, the determination of the majority of the inspectors shall be binding. Section 12. Organization. At each meeting of stockholders the Chairman of the Board of Directors, if one shall have been elected, (or in his absence or if one shall not have been elected, the President) shall act as chairman of the meeting. The Secretary (or in his absence or inability to act, the person whom the Chairman of the meeting shall appoint secretary of the meeting) shall act as secretary of the meeting and keep the minutes thereof. Section 13. Order of Business. The order and manner of transacting business at all meetings of stockholders shall be determined by the Chairman of the meeting. ARTICLE III DIRECTORS Section 1. Powers. Except as otherwise required by law or provided by the Certificate of Incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. Section 2. Number and Election of Directors. Directors shall be elected at each annual meeting of stockholders and each director so elected shall hold office until his successor is duly elected and qualified, or until his earlier death, resignation or removal. Any director may resign at any time effective upon giving written notice to the Board of Directors, unless the notice specifies a later time for such resignation to become effective. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. If the resignation of a director is effective at a future time, the Board of Directors may elect a successor prior to such effective time to take office when such resignation becomes effective. Directors need not be stockholders. Section 3. Vacancies. Except as otherwise set forth herein, vacancies in the Board of Directors may be filled by a majority of the remaining directors, though less than a quorum, or by a sole remaining director, except that a vacancy created by the removal of a director by the vote or written consent of the stockholders may be filled only by the vote of a majority of the shares entitled to vote represented at a duly held meeting at which a quorum is present, or by the written consent of holders of a majority of the outstanding shares entitled to vote. Each director so elected shall hold office until the next annual meeting of the stockholders and until a successor has been elected and qualified. A vacancy or vacancies in the Board of Directors shall be deemed to exist in the event of the death, resignation, or removal of any director, or if the authorized number of directors is increased, or if the stockholders fail, at any meeting of stockholders at which any director or directors are elected, to elect the number of directors to be voted for at that meeting. The stockholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors, but any such election by written consent shall require the consent of a majority of the outstanding shares entitled to vote. No reduction of the authorized number of directors shall have the effect of removing any director before that director's term of office expires. Section 4. Time and Place of Meetings. The Board of Directors shall hold its meetings at such place, either within or without the State of Delaware, and at such time as may be determined from time to time by the Board of Directors. Unless otherwise approved by a majority of the Independent Directors (as defined in Article X below), all meetings of the Board of Directors shall be held within the United States. Section 5. Annual Meeting. The Board of Directors shall meet for the purpose of organization, the election of officers and the transaction of other business, as soon as practicable after each annual meeting of stockholders, on the same day and at the same place where such annual meeting shall be held. Notice of such meeting need not be given. In the event such annual meeting is not so held, the annual meeting of the Board of Directors may be held at such place, either within or without the State of Delaware, on such date and at such time as shall be specified in a notice thereof given as hereinafter provided in Section 7 of this Article III or in a waiver of notice thereof. Section 6. Regular Meetings. Regular meetings of the Board of Directors may be held at such places within or without the State of Delaware at such date and time as the Board of Directors may from time to time determine and, if so determined by the Board of Directors, notices thereof need not be given. Section 7. Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board, the President, by any Vice President, the Secretary or by any two directors, provided that no special meeting shall be held unless at least one Independent Director is present. Notice of the date, time and place of special meetings shall be delivered personally or by telephone to each director or sent by first class mail or telegram, charges prepaid, addressed to each director at the director's address as it is shown on the records of the Corporation. In case the notice is mailed, it shall be deposited in the United States mail at least five days before the time of the holding of the meeting. In case the notice is delivered personally or by telephone or telegram, it shall be delivered personally or by telephone or to the telegraph company at least 48 hours before the time of the holding of the meeting. The notice need not specify the purpose of the meeting. Section 8. Quorum; Vote Required for Action: Adjournment. Except as otherwise required by law, or provided in the Certificate of Incorporation or these Bylaws, a majority of the directors shall constitute a quorum for the transaction of business at all meetings of the Board of Directors and the affirmative vote of not less than a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may adjourn the meeting, from time to time, without notice other than announcement at the meeting, until a quorum shall be present. A meeting at which a quorum is initially present may continue to transact business, notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum to conduct that meeting. When a meeting is adjourned to another time or place (whether or not a quorum is present), notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the Board of Directors may transact any business which might have been transacted at the original meeting. Notwithstanding anything to the contrary herein, two-thirds (2/3) of the directors shall be required to constitute a quorum for, and the affirmative vote of not less than two-thirds (2/3) of all the directors shall be required to approve, any action that would (i) amend that certain Amended and Restated Rights Agreement between the Corporation and American Stock Transfer & Trust Company as Successor Rights Agent dated as of January 28, 1994, as amended by the First Amendment thereto dated as of March 1, 1995, or any new stockholder rights plan; or (ii) adopt any new stockholder rights plan, if such amendment or new stockholder rights plan does not contain provisions equivalent to those set forth in such First Amendment for the benefit of Samsung Electronics Co., Ltd. Section 9. Action by Written Consent. Unless otherwise restricted by the Certificate of Incorporation, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all the members of the Board of Directors or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or committee. Section 10. Telephone Meetings. Unless otherwise restricted by the Certificate of Incorporation, members of the Board of Directors of the Corporation, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors or such committee, as the case may be, by conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting pursuant to this Section 10 shall constitute presence in person at such meeting. Section 11. Committees. The Board of Directors may, by resolution passed by a majority of the entire Board, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board of Directors may designate one or more directors as alternate members of any such committee, who may replace any absent or disqualified member at any meeting of the committee. Any committee, to the extent allowed by law and as provided in the resolution establishing such committee, shall have and may exercise all the power and authority of the Board of Directors in the management of the business and affairs of the Corporation. Each committee shall report to the Board of Directors when required. Section 12. Compensation. The directors may be paid such compensation for their services as the Board of Directors shall from time to time determine. Section 13. Interested Directors. No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or the committee thereof which authorizes the contract or traction, or solely because his or their votes are counted for such purpose if: (i) the material facts as to his or their relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (ii) the material facts as to his or their relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (iii) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved or ratified, by the Board of Directors, a committee thereof, or the stockholders. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction. ARTICLE IV OFFICERS Section 1. Executive Officers. The executive officers of the Corporation shall be a President, a Chief Executive Officer, a Chief Financial Officer and a Secretary. The Secretary shall have the duty, among other things, to record the proceedings of the meetings of stockholders and directors in a book kept for that purpose. The Corporation may also have such other executive officers, including one or more Vice Presidents, as the Board may in its discretion appoint. The Board of Directors, if it so determines, may appoint a Chairman of the Board and a Vice Chairman of the Board from among its members, but such titles shall not confer upon such Board members executive officer status. Any number of offices may be held by the same person. Section 2. Election, Term of Office and Remuneration. The executive officers of the Corporation shall be elected annually by the Board of Directors at the annual meeting or a regular meeting thereof. Each such officer shall hold office at the discretion of the Board of Directors until his successor is elected and qualified, or until his earlier death, resignation or removal. The remuneration of all officers of the Corporation shall be fixed by the Board of Directors. Any vacancy in any office shall be filled in such manner as the Board of Directors shall determine. Section 3. Subordinate Officers. In addition to the executive officers enumerated in Section 1 of this Article IV, the Corporation may have one more assistant treasurers and assistant secretaries and such other subordinate officers, agents and employees as the Board of Directors may deem necessary, each of whom shall hold office for such period as the Board of Directors may from time to time determine. The Board of Directors may delegate to any executive officer the power to appoint and to remove any such subordinate officers, agents or employees. Section 4. Removal. Except as otherwise delegated to an executive officer with respect to subordinate officers, any officer may be removed, with or without cause, at any time, by resolution adopted by the Board of Directors. Such removal shall be without prejudice to the contractual rights of such officer, if any, with the Corporation. Section 5. Resignations. Any officer may resign at any time by giving written notice to the Board of Directors (or to a principal officer if the Board of Directors has delegated to such principal officer the power to appoint and to remove such officer). The resignation of any officer shall take effect upon receipt of notice thereof or at such later time as shall be specified in such notice; unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 6. Powers and Duties. The Board of Directors may designate an officer as the Chief Executive Officer. The Chief Executive Officer shall, subject to the direction and control of the Board of Directors, be the general manager of, and supervise and direct, the business and affairs of the Corporation and the conduct of the officers of the Corporation. The other officers of the Corporation shall have such powers and perform such duties incident to each of their respective offices and such other duties as may from time to time be conferred upon or assigned to them by the Board of Directors or the Chief Executive Officer. ARTICLE V STOCK Section 1. Form of Certificates. Every holder of stock in the Corporation shall be entitled to have a certificate signed, in the name of the Corporation (i) by the Chairman of the Board of Directors, the President or a Vice President and (ii) by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the Corporation, certifying the number of shares owned by him in the Corporation. Section 2. Signatures. Any, or all, of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the date of issue. Section 3. Lost Certificates. The Corporation may issue a new certificate to be issued in place of any certificate theretofore issued by the Corporation, alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate to be lost, stolen or destroyed. The Corporation may, in its discretion and as a condition precedent to the issuance of such new certificate, require the owner of such lost, stolen, or destroyed certificate, or his legal representative, to give the Corporation a bond (or other security) sufficient to indemnify it against any claim that may be made against the Corporation (including any expense or liability) on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. Section 4. Transfers. Stock of the Corporation shall be transferable in the manner prescribed by law and in these Bylaws or in any agreement with the stockholder making the transfer. Transfers of stock shall be made on the books of the Corporation only by the person named in the certificate or by his attorney lawfully constituted in writing and upon the surrender of the certificate therefor, which shall be cancelled before a new certificate shall be issued. Section 5. Registered Owners. The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise required by law. ARTICLE VI LIMITATION OF LIABILITY No person shall be liable to the Corporation for any loss or damage suffered by it on account of any action taken or omitted to be taken by him as a director or officer of the Corporation if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation or, with respect to any criminal matter, had no reasonable cause to believe that his conduct was unlawful. ARTICLE VII INDEMNIFICATION Section 1. Action Other Than by or in the Right of the Corporation. Subject to Section 3 of this Article VII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, and whether external or internal to the Corporation, (other than a judicial action or suit brought by or in the right of the Corporation) by reason of the fact that he is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director or officer of another corporation, partnership, joint venture, trust or other enterprise (all such persons being referred to hereafter as an "Agent"), against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, that he had reasonable cause to believe that his conduct was unlawful. Section 2. Action by or in the Right of the Corporation. The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed judicial action or suit brought by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he is or was an Agent (as defined in Section 1) against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or other such court shall deem proper. Section 3. Determination of Right of Indemnification. Any indemnification under Sections 1 or 2 (unless ordered by a court) shall be made by the Corporation unless a determination is reasonably and promptly made (i) by the Board by a majority vote of a quorum consisting of directors who are or were not parties to such action, suit or proceeding, or (ii) if such a quorum is not obtainable, or, even if obtainable, if a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (iii) by the stockholders, that such person acted in bad faith and in a manner that such person did not believe to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal proceeding, that such person believed or had reasonable cause to believe that his conduct was unlawful. Section 4. Indemnification Against Expenses of Successful Party. Notwithstanding the other provisions of this Article, to the extent that an Agent has been successful on the merits or otherwise, including the dismissal of an action without prejudice or the settlement of an action without admission of liability, in defense of any proceeding or in defense of any claim, issue or matter therein, such Agent shall be indemnified against all expenses incurred in connection therewith. Section 5. Advances of Expenses. Except as limited by Section 6 of this Article VII, expenses incurred in defending or investigating any action, suit, proceeding or investigation shall be paid by the Corporation in advance of the final disposition of such matter, if the Agent shall undertake to repay such amount in the event that it is ultimately determined, as provided herein, that such person is not entitled to indemnification. However, no advance shall be made by the Corporation if a determination is reasonably and promptly made by the Board of Directors by a majority vote of a quorum of disinterested directors, or (if such a quorum is not obtainable or, even if obtainable, a quorum of disinterested directors so directs) by independent legal counsel in a written opinion, that, based upon the facts known to the Board or counsel at the time such determination is made, such person acted in bad faith and in a manner that such person did not believe to be in or not opposed to the best interest of the Corporation, or, with respect to any criminal proceeding, that such person believed or had reasonable cause to believe his conduct was unlawful. In no event shall any advance be made in instances where the Board or independent legal counsel reasonably determines that such person deliberately breached his duty to the Corporation or its stockholders. Section 6. Right of Agent to Indemnification Upon Application; Procedure Upon Application. Any indemnification under Sections 2, 3, and 4, or advance under Section 5 of this Article VII, shall be made promptly and in any event within 45 days, upon the written request of the Agent, unless with respect to applications under Sections 2, 3, or 5, a determination is reasonably and promptly made by the Board of Directors by a majority vote of a quorum of disinterested directors that such Agent acted in a manner set forth in such Sections as to justify the Corporation's not indemnifying or making an advance to the Agent. In the event no quorum of disinterested directors is obtainable, the Board of Directors shall promptly direct that independent legal counsel shall decide whether the Agent acted in the manner set forth in such Sections as to justify the Corporation's not indemnifying or making an advance to the Agent. The right to indemnification or advances as granted by this Article VII shall be enforceable by the Agent in any court of competent jurisdiction if the Board or independent legal counsel denies the claim, in whole or in part, or if no disposition of such claim is made within 45 days. The Agent's expenses incurred in connection with successfully establishing his right to indemnification, in whole or in part, in any such proceeding shall also be indemnified by the Corporation. Section 7. Other Rights and Remedies. The indemnification provided by this Article VII shall not be deemed exclusive of any other rights to which an Agent seeking indemnification may be entitled under any Bylaw, agreement, vote of stockholders or disinterested directors, court order or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, since it is the policy of the Corporation that indemnification of Agents shall be made to the fullest extent permitted by law. The indemnification provided by this Article shall continue as to a person who has ceased to be an Agent and shall inure to the benefit of the heirs, executors and administrators of such a person. All rights to indemnification under this Article shall be deemed to be provided by a contract between the Corporation and the Agent who serves in such capacity at any time while these Bylaws and other relevant provisions of the General Corporation Law of the State of Delaware and other applicable law, if any, are in effect. Any repeal or modification thereof shall not affect any rights or obligations then existing. Section 8. Insurance. The Corporation may purchase and maintain insurance on behalf of any person who is or was an Agent against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Corporation would have the power to indemnify him against such liability under the provisions of this Article. Section 9. Indemnity Fund. Upon resolution passed by the Board, the Corporation may establish a trust or other designated account, grant a security interest or use other means (including, without limitation, a letter of credit), to ensure the payment of certain of its obligations arising under this Article and/or agreements which may be entered into between the Company and its officers and directors from time to time. Section 10. Constituent Corporations. For the purposes of this Article, references to "the Corporation" include all constituent corporations absorbed in a consolidation or merger as well as the resulting or surviving corporation, so that any person who is or was a director or officer of such a constituent corporation or is or was serving at the request of such constituent corporation as a director or officer of another corporation, partnership, joint venture, trust or other enterprise shall stand in the same position under the provisions of this Article with respect to the resulting or surviving corporation as he would had he served such constituent corporation in the same capacity. Section 11. Other Enterprises, Fines, and Serving at Corporation's Request. For purposes of this Article, references to "other enterprise" in Sections 1 and 10 shall include employee benefit plans; references to "fines" shall include any excise taxes assessed a person with respect to any employee benefit plan; and references to "serving at the request of the Corporation" shall include any service as a director or officer of the Corporation which imposes duties on, or involves services by, such director or officer with respect to any employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the Corporation" as referred to in this Article. Section 12. Indemnification of Other Persons. The provisions of this Article VII shall not be deemed to preclude the indemnification of any person who is not an Agent (as defined in Section 1), but whom the Corporation has the power or obligation to indemnify under the provisions of the General Corporation Law of the State of Delaware or otherwise. The Corporation may, in its sole discretion, indemnify an employee, trust or other agent as permitted by the General Corporation Law of the State of Delaware. The Corporation shall indemnify an employee, trustee or other agent where required by law. Section 13. Savings Clause. If this Article or any portion thereof shall be invalidated on any ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify each Agent against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, and whether internal or external, including a grand jury proceeding and an action or suit brought by or in the right of the Corporation, to the full extent permitted by any applicable portion of this Article that shall not have been invalidated, or by any other applicable law. ARTICLE VIII RECORDS Section 1. Maintenance and Inspection of Share Register. The Corporation shall keep at its principal executive office, or at the office of its transfer agent or registrar, if either be appointed and as determined by resolution of the Board of Directors, a record of its stockholders, giving the names and addresses of all stockholders and the number and class of shares held by each stockholder. A stockholder or stockholders of the Corporation holding at least 5% in the aggregate of the outstanding voting shares of the Corporation or who hold at least l% of such voting shares and have filed a Schedule 14B with the United States Securities and Exchange Commission relating to the election of directors of the Corporation may (i) inspect and copy the records of stockholders' names and addresses and stockholdings during usual business hours on 5 days' prior written demand on the Corporation, or (ii) obtain from the transfer agent of the Corporation, on written demand and on the tender of such transfer agent's usual charges for such list, a list of the stockholders' names and addresses, who are entitled to vote for the election of directors, and their stockholdings, as of the most recent record date for which that list has been compiled or as of a date specified by the stockholder after the date of demand. This list shall be made available to any such stockholder by the transfer agent on or before the later of 5 days after the demand is received or the date specified in the demand as the date as of which the list is to be compiled. The record of stockholders shall also be open to inspection on the written demand of any stockholder or holder of a voting trust certificate, at any time during usual business hours, for a purpose reasonably related to the holder's interests as a stockholder or as the holder of a voting trust certificate. Any inspection and copying under this Section I may be made in person or by an agent or attorney of the stockholder or holder of a voting trust certificate making the demand. Section 2. Maintenance and Inspection of Bylaws. The Corporation shall keep at its principal executive office, the original or a copy of these Bylaws, as amended, to date, which shall be open to inspection by the stockholders at all reasonable times during office hours. ARTICLE IX GENERAL PROVISIONS Section 1. Dividends. Subject to limitations contained in the General Corporation Law of the State of Delaware and the Certificate of Incorporation, the Board of Directors may declare and pay dividends upon the shares of capital stock of the Corporation, which dividends may be paid either in cash, securities of the Corporation or other property. Section 2. Disbursements. All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate. Section 3. Fiscal Year. The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors. Section 4. Corporate Seal. The Corporation shall have a corporate seal in such form as shall be prescribed by the Board of Directors. Section 5. Record Date. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than 60 days nor less than ten days before the date of such meeting, nor more than 60 days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Stockholders on the record date are entitled to notice and to vote or to receive the dividend, distribution or allotment of rights or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after the record date, except as otherwise provided by agreement or by applicable law. Section 6. Voting of Stock Owned by the Corporation. The Board of Directors may authorize any person, on behalf of the Corporation, to attend, vote and grant proxies to be used at any meeting of stockholders of any corporation (except this Corporation) in which the Corporation may hold stock. Section 7. Construction and Definitions. Unless the context requires otherwise, the general provisions, rules of construction and definitions in the General Corporation law of the State of Delaware shall govern the construction of these Bylaws. Section 8. Amendments. Subject to the General Corporation Law of the State of Delaware, the Certificate of Incorporation and these Bylaws, the Board of Directors may by majority vote of those present at any meeting at which a quorum is present amend or repeal these Bylaws, or enact other Bylaws as in their judgment may be advisable for the regulation of the conduct of the affairs of the Corporation. Unless otherwise restricted by the Certificate of Incorporation, subject to Article X below, these Bylaws may be altered, amended or repealed at any annual meeting of the stockholders (or at any special meeting thereof duly called for that purpose) by a majority of the combined voting power of the then outstanding shares of capital stock of all classes and series of the Corporation entitled to vote generally in the election of directors, voting as a single class, provided that, in the notice of any such special meeting, notice of such purpose shall be given. ARTICLE X AUTOMATIC AMENDMENT PURSUANT TO STOCKHOLDER AGREEMENT Reference is made to that certain Stockholder Agreement (the "Stockholder Agreement") dated as of July 31, 1995 by and between the Corporation and Samsung Electronics Co., Ltd. ("Samsung"), as amended by Amendment No. 1 to Stockholder Agreement (the "Amendment") dated as of December 21, 1995 by and between the Corporation and Samsung. Section 7 of the Amendment provides for an amendment to Article 4 of the Stockholder Agreement during such time as the Purchaser Interest (calculated as provided for in Section 2.1.7 of the Stockholder Agreement) shall be at least 40%, and provides further for the restoration of Article 4 as originally set forth in the Stockholder Agreement (the "Restoration") in the event the Purchaser Interest shall have been less than 40% for a period of at least twenty-five (25) consecutive days. In the event the Restoration occurs, then automatically and without any further action required by the Board of Directors or the stockholders, these Bylaws shall be amended as set forth on Exhibit 1 hereto. Notwithstanding anything to the contrary herein, this Article X may not be amended or repealed without the approval of a majority of the Independent Directors (as defined in the Amendment). EX-99.5 6 CONFIDENTIAL SAMSUNG ELECTRONICS CO., LTD. Samsung Main Building 250 2-Ka Taepyung-Ro, Chun-Ku Seoul, Korea 100-742 December 21, 1995 AST Research, Inc. 16215 Alton Parkway Irvine, CA 92718 Attention: Board of Directors Gentlemen: This letter is provided by Samsung Electronics Co., Ltd. ("SEC") to AST Research, Inc. ("AST") in connection with the transactions contemplated by that certain Additional Support Agreement of even date herewith between SEC and AST (the "Additional Support Agreement"). In addition to the extended vendor credit and the Guaranty contemplated by the Additional Support Agreement, SEC had indicated its willingness to provide certain other elements of support to AST up to an aggregate amount of approximately $50 million ("Other Support"). SEC would have sole and absolute discretion to determine the terms and form of such Other Support, which could include component discounts, joint development, technology transfers, and/or other forms of support as may be determined by SEC. This letter is solely an expression of SEC's good will and shall not be binding upon or enforceable against SEC in any respect except to the extent specifically provided in a definitive written contract for Other Support signed by authorized representatives of AST and SEC. Except as specifically provided in such a definitive written contract, any Other Support provided by SEC may be discontinued by SEC at any time in its sole and absolute discretion. If you are in agreement with the foregoing, please return a signed copy of this letter to the undersigned. Very Truly Yours, SAMSUNG ELECTRONICS CO., LTD. By: Won Suk Yang Title: Senior Executive Managing Director Accepted and agreed to: AST RESEARCH, INC. By: Ian Diery Title: President and Chief Executive Officer -----END PRIVACY-ENHANCED MESSAGE-----