EX-99.(A)(5)(III) 2 dex99a5iii.htm CLASS ACTION COMPLAINT - "RIDGEWAY V. YEH ET AL." Class Action complaint - "Ridgeway v. Yeh et al."

Exhibit (a)(5)(iii)

 

   STEPHEN R. BASSER (121590)   
1    SAMUEL M. WARD (216562)   
   BARRACK, RODOS & BACINE   
2    One America Plaza   
   600 West Broadway, Suite 900   
3    San Diego, CA 92101   
   Telephone: (619) 230-0800   
4    Facsimile: (619) 230-1874   
5    Counsel For Plaintiffs Ryan Ridgeway and   
6    David Thompson   
7      
8      
9    SUPERIOR COURT OF THE STATE OF CALIFORNIA
10    COUNTY OF SANTA CLARA
11      
12    RYAN RIDGEWAY AND DAVID THOMPSON,    CASE NO. 109CV157437
13    Plaintiffs,    CLASS ACTION COMPLAINT FOR
14       INJUNCTIVE RELIEF RE: BREACH OF
  

v.

   FIDUCIARY DUTY AND AIDING AND
15       ABETTING A BREACH OF FIDUCIARY
   BING YEH, YAH WEN HU, RONALD    DUTY
16    CHWANG, TERRY NICKERSON, EDWARD   
17    Y.W. YANG, SILICON STORAGE   
   TECHNOLOGY, INC. and PROPHET EQUITY   
18    LP,   
      JURY TRIAL DEMANDED
19    Defendants.   
20      
21      
22      
23      
24      
25      
26      
27      
28      


   VERIFIED CLASS ACTION COMPLAINT
1   

Plaintiffs, Ryan Ridgeway and David Thompson, by their attorneys, allege on

2    information and belief except as to paragraph 7, which plaintiff Ryan Ridgeway alleges on
3    personal knowledge and paragraph 8, which plaintiff David Thompson alleges on personal
4    knowledge:
5    SUMMARY OF THE ACTION
6   

1. This is a shareholder class action on behalf of the public shareholders of Silicon

7    Storage Technology, Inc. (“Silicon Storage” or the “Company”) against the Company and its
8    Board of Directors (the “Board” or the “Individual Defendants”), to enjoin the proposed
9    acquisition of Silicon Storage by Prophet Equity LP (“Prophet”), and alleging that the Board
10    breached its fiduciary duties in connection with the proposed sale of the Company to Prophet
11    and members of the Company’s management for $2.10 per share in cash, or approximately
12    $201 million in the aggregate (the “Proposed Transaction”).
13   

2. The Proposed Transaction is unfair and fails to maximize shareholder value and

14    otherwise undervalues the Company’s shares. The consideration offered to public shareholders
15    is only a 13% premium over the close of $1.86 per share on the day before the Proposed
16    Transaction was announced publicly. Indeed, the Company’s shares traded at or above the
17    offering price as recently as two weeks before the Proposed Transaction was announced and
18    since the announcement of the Proposed Transaction shares have traded over the inadequate
   offer price.
19   

3. Accordingly, this action seeks, inter alia, equitable relief seeking to enjoin the

20    Proposed Transaction and compelling the Board to properly exercise its fiduciary duties to
21    maximize shareholder value in connection with the Proposed Transaction or any alternate
22    transaction.
23    JURISDICTION AND VENUE
24   

4. This Court has jurisdiction over the cause of action asserted herein pursuant to

25    the California Constitution, Article VI, § 10, because this case is a cause not given by statute to
26    other trial courts.
27   

5. This Court has jurisdiction over defendant Silicon Storage because it conducts

28    business in California and maintains its principal place of business at 1171 Sonora Court,

 

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1    Sunnyvale, California. This action is not removable.
2   

6. Venue is proper in this Court because the conduct at issue took place and had an

   effect in this County.
3    PARTIES
4   

7. Plaintiff Ryan Ridgeway is, and at all times relevant hereto was, a shareholder of

5    Silicon Storage.
6   

8. Plaintiff David Thompson is, and at all times relevant hereto was, a shareholder

7    of Silicon Storage.
8   

9. Defendant Silicon Storage supplies NOR flash memory semiconductor devices

9    for digital consumers, networking, wireless communications, and the Internet computing
10    markets. The Company produces and sells semiconductor products, including NAND flash
11    controllers and NAND controller-based modules, smart card integrated circuits (“ICs”) and
12    modules, flash microcontrollers, and radio frequency ICs and modules. It also produces and
13    sells various products based on its proprietary SuperFlash design and manufacturing process
14    technology, as well as licenses the SuperFlash technology for applications in semiconductor
15    devices that integrate flash memory with other functions on a monolithic chip. Silicon Storage
16    sells its products in Asia, North America and Europe. The Company’s common stock publicly
17    trades on the NASDAQ Stock Market (“NASDAQ”) under the trading symbol “SSTI.” As of
   October 31, 2009, Silicon Storage had over 95 million shares of common stock outstanding.
18   

10. Defendant Bing Yeh (“Yen”), one of the co-founders of Silicon Storage, has

19    served as the President and Chief Executive Officer and has been a member of the Company’s
20    Board of Directors since its inception in 1989. In April 2004, he was appointed Chairman of
21    the Board of Directors.
22   

11. Defendant Yaw Wen Hu (“Hu”) has been a member of the Board of Directors of

23    Silicon Storage since 1995. He joined the Company in 1993 as Vice President of Technology
24    Development. Currently, defendant Hu is the Executive Vice President and Chief Operating
25    Officer of Silicon Storage.
26   

12. Defendant Ronald Chwang has been a member of the Company’s Board of

27    Directors since June 1997. He is also a member of the Audit Committee and the Compensation
28    Committee and the Chairman of the Nominating and Corporate Governance Committee.

 

2

CLASS ACTION COMPLAINT


1   

13. Defendant Terry Nickerson has been a member of the Company’s Board of

2    Directors since April 2005. He is the Chairman of the Audit Committee and a member of the
   Compensation Committee and the Nominating and Corporate Governance Committee.
3   

14. Defendant Edward Y.W. Yang has been a member of the Company’s Board of

4    Directors since October 2007.
5   

15. Defendant Prophet, a private equity firm, is located at 181 Grand Avenue,

6    Southlake, Texas.
7   

16. The defendants identified in ¶¶ 10 - 14 are collectively referred to herein as the

8    “Individual Defendants.” By reason of their positions as officers and/or directors of the
9    Company, the Individual Defendants are in a fiduciary relationship with Plaintiffs and the other
10    public shareholders of Silicon Storage, and owe Plaintiffs and Silicon Storage’s other
11    shareholders the highest obligations of loyalty, good faith, fair dealing, due care, and full and
   fair disclosure.
12   

17. Each of the Individual Defendants at all times had the power to control and direct

13    Silicon Storage to engage in the misconduct alleged herein. The Individual Defendants’
14    fiduciary obligations required them to act in the best interest of Plaintiffs and all other Silicon
15    Storage shareholders.
16   

18. Each of the Individual Defendants owes fiduciary duties of good faith, fair

17    dealing, loyalty, candor, and due care to Plaintiffs and the other members of the Class. They are
18    acting in concert with one another in violating their fiduciary duties as alleged herein, and,
   specifically, in connection with the Proposed Transaction.
19   

19. As directors and/or officers of a publicly traded corporation, the Individual

20    Defendants have an affirmative fiduciary obligation to obtain the highest value reasonably
21    available for the Company’s shareholders and to avoid taking action that:
22   

(a) discourages or inhibits alternative offers to purchase Silicon Storage;

23   

(b) adversely affects the value provided to the Company’s shareholders;

24   

(c) contractually prohibits them from complying with their fiduciary duties;

25   

(d) adversely affects their ability to secure the best value reasonably

26   

available under the circumstances for the corporation’s shareholders; and/or

27   

(e) provides Silicon Storage insiders with preferential treatment at the

28   

expense of, or separate from, its public shareholders.

 

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CLASS ACTION COMPLAINT


1   

7. In accordance with his/her duties of loyalty and good faith, the Individual

2    Defendants are also obligated to refrain from:
3   

(a) participating in any transaction in which their loyalties are divided;

4   

(b) participating in any transaction in which they will receive a personal

  

financial benefit not equally shared by the public shareholders of the corporation; and/or

5   

(c) unjustly enriching themselves at the expense or to the detriment of the

6   

public shareholders.

   SUBSTANTIVE ALLEGATIONS
7   

20. Silicon Storage, which was founded in 1989, designs, manufactures and markets

8    a diversified range of memory and non-memory products for high volume applications in the
9    digital consumer, networking, wireless communications and Internet computing markets. With
10    its proprietary, patented SuperFlash technology, the Company is a leading provider of
11    nonvolatile memory solutions for products with various densities of high functionality flash
12    memory components and flash mass storage products. The Company has a broad network of
13    world-class manufacturing partners and technology licensees, including TSMC, which offers it
14    under its trademark Emb-FLASH. Additionally, Silicon Storage offers non-memory products
15    include NAND controller-based products, smart card ICs and modules, flash microcontrollers
   and radio frequency ICs and modules.
16   

21. The Company’s products have been very successful. On November 2, 2009, just

17    days before the announcement of the Proposed Transaction, Silicon Storage unveiled the
18    industry’s first 1.8V, high-speed quad-bit serial flash memory. It features an 80 MHz operating
19    frequency and a specialized instruction set and allows programs to be stored and executed
20    directly from the flash memory without the need for code shadowing. Its technology is ideal for
21    mobile handsets, Bluetooth headsets, GPS devices and other small form factor, portable
22    electronics. This new product follows after the Company won an Innovation of the Year Award
   from EDN Magazine in April of 2009 for another flash product.
23   

22. The Company’s positive prospects suggest that the Proposed Transaction

24    undervalues its shares. Silicon Storage has seen bright prospects in recent months as a result of
25    stronger product and licensing revenue and cost cuts to help the bottom line. Indeed, in
26    September 2009, the Company raised its guidance for the second quarter ending September 30,
27    2009. The Company said it now sees revenue of $69 million to $71 million, up from a
28    previously expected $61 million to $68 million and now expects net income of zero to 3 cents a

 

4

CLASS ACTION COMPLAINT


1    share, up from a previously forecast loss of 3-7 cents a share. Silicon Storage further said that
2    the better forecast reflects “stronger than anticipated product and licensing revenues in the
3    quarter as well as increased dividends on investments and lower operating expenses.” Despite
4    its recent strong performance and its potential for continued growth and success, Silicon
5    Storage, via its Board of Directors has willingly accepted inadequate consideration and entered
   into the Proposed Transaction to the detriment of its public shareholders.
6   

23. On November 13, 2009, Silicon Storage announced publicly that it agreed to be

7    acquired by management and equity firm Prophet and members of the Company’s management,
8    pursuant to which Silicon Storage’s public shareholders will receive $2.10 in cash for each
9    share of common stock in the Company that they own. The aggregate value of the deal is
   $201 million. The Proposed Transaction is expected to close during the second quarter of 2010.
10   

24. Under the terms of the Proposed Transaction, shares of Silicon Storage will no

11    longer trade on a stock exchange and shareholders will not receive a continuing interest in the
12    Company. While the public shareholders’ investment in Silicon Storage will be terminated if
13    the Proposed Transaction is consummated, defendant Yeh, the Company’s Chairman and Chief
14    Executive Officer, and defendant Hu, the Company’s Executive Vice President and Chief
15    Operating Officer, who together hold or control 12.7 percent of outstanding shares of Silicon
16    Storage, will continue having an equity interest in the Company as they have agreed to
17    exchange all of their shares of Silicon Storage for shares of capital stock of the resulting
18    privately held company. Accordingly, Prophet and defendant Yeh and Hu stand to benefit from
19    the Company’s promising growth and operational results. In contrast, Silicon Storage
20    shareholders do not. Defendants Yeh and Hu have also entered into voting agreements pursuant
21    to which they have agreed to vote their shares in favor of the Proposed Transaction and against
   any other acquisition proposals.
22   

25. The consideration to public shareholders is only a 13 percent premium over the

23    $1.86 closing price on November 12, 2009, the last day of trading before the Proposed
24    Transaction was announced. Shares traded at this level as recently as two weeks ago on
25    October 29, 2009. Aside from the fact that the Proposed Transaction appears to favor two of
26    Silicon Storage’s insider shareholders, the trading price of the Company’s common stock in the
27    wake of the Proposed Transaction’s announcement suggests that the market believes that the
28    shares should fetch a higher price. Indeed, since the Proposed Transaction was announced, the

 

5

CLASS ACTION COMPLAINT


1    stock has traded above the $2.10 offering price. Market reaction to the announcement of the
2    Proposed Transaction has been swift, as investors sent Silicon Graphic’s stock price up
3    approximately 20% to close at $2.24 on the day the Proposed Transaction was announced. As a
4    result, the price Prophet is offering in the Proposed Transaction, and the Company has
   unanimously accepted, already represents a discount to Silicon Storage’s public shareholders.
5   

26. A Strategic Committee of the Company’s Board of Directors, consisting of all

6    four of the so-called “independent” members of the Board, was formed to evaluate the Proposed
7    Transaction. The Strategic Committee approved the Merger Agreement and resolved to
8    recommend that the Company’s shareholders adopt and approve the agreement. However,
9    Bryant R. Riley, one of the independent directors since 2008 and a major holder in the
10    Company, voted against the approval of the Merger Agreement and subsequently resigned from
   the Board of Directors on the day the Proposed Transaction was announced.
11   

27. Moreover, Lloyd I. Miller, III, Silicon Storage’s second largest shareholder, filed

12    a Schedule 13D-A with the United States Securities and Exchange Commission on November
13    13, 2009. In it, Mr. Miller revealed that he “strongly opposes the price terms of the recently
14    announced merger” and that “it would be in his best interest, and those of other stockholders, to
15    attempt to influence the governance and business strategies of the Company.” Mr. Miller
16    expressed concern about the appearance of opposition to the Proposed Transaction on the Board
17    of Directors and about the appearance of conflicts of interest in the Proposed Transaction.
18    Specifically, Mr. Miller notes (1) the resignation of Bryant R. Riley and his vote against the
19    Proposed Transaction, and (2) the special treatment of the shares of two insiders, defendants
20    Yeh and Hu, who will receive equity in the acquiring company while public shareholders will
21    be cashed out at $2.10, a price that Mr. Miller believes is deficient. Mr. Miller is examining all
22    of the options that he believes will enhance stockholder value, including encouraging,
23    participating in or leading efforts to appoint individuals to the Company’s Board of Directors
24    who would be independent of management and would represent the Company and the holders
   of the shares.
25   

28. No doubt recognizing that the deal is unfair to existing shareholders, the

26    individual defendants, aided and abetted by Prophet, have attempted to camouflage their
27    breaches of fiduciary duty to Silicon Storage shareholders by the inclusion of a cosmetic “go
28    shop” provision in the Merger Agreement. This provision is insufficient to protect the interests

 

6

CLASS ACTION COMPLAINT


1    of Silicon Storage’s public shareholders. Any potential suitor for the Company’s shares must
2    complete its due diligence within the short, 45 day time permitted by the “go shop” provision,
3    which is expected to expire on December 28, 2009. Under the circumstances, the provision is
4    cosmetic and merely intended to camouflage the fact that the Board violated its fiduciary duties
5    and engaged in an unfair process that lead to an inadequate and unfair price. Now, any third
6    party that would have paid a fair price for the Company is advantaged by the knowledge that the
7    Board has already made it clear that it would be willing to agree, and indeed has agreed, to a
   wholly unfair and inadequate price and is not focused upon maximizing shareholder value.
8   

29. Moreover, if a potential acquiror were to propose a transaction more favorable to

9    Silicon Storage’s public shareholders, pursuant to Section 8.3(b) of the Merger Agreement, the
10    Company would be required to pay the sum of $7.05 million or approximately 3.5 percent of the
11    deal value to Prophet as a termination fee, thus hindering the prospect of a more favorable
   transaction from being proposed.
12   

30. Accordingly, the Proposed Transaction undervalues the Company’s shares when

13    giving due consideration to the Company’s anticipated operating results and prospects. The
14    Proposed Transaction will deny class members their right to share proportionately and equitably
15    in the true value of the Company’s valuable and profitable business, and future growth in profits
16    and earnings, at a time when the Company is poised to increase its profitability. Unless the
17    Individual Defendants are enjoined from breaching their fiduciary duties, Plaintiffs and the
   other public shareholders of Silicon Storage will continue to suffer irreparable harm.
18   

31. Plaintiffs allege herein that the Individual Defendants, separately and together, in

19    connection with the Proposed Transaction, violated the fiduciary duties owed to plaintiffs and
20    the other public shareholders of Silicon Storage, including their duties of loyalty, good faith,
21    candor, due care and independence, insofar as they stood on both sides of the transaction and
22    engaged in self-dealing and obtained for themselves personal benefits, including personal
23    financial benefits, not shared equally by plaintiffs or the Class. As a result of the Individual
24    Defendants’ self-dealing and divided loyalties, neither Plaintiffs nor the Class will receive
25    adequate or fair value for their Silicon Storage investment in the Proposed Transaction.
26   

32. Because the Individual Defendants have breached their duties of due care,

27    loyalty and good faith in connection with the Proposed Transaction, the burden of proving the
28    inherent or entire fairness of the Proposed Transaction, including all aspects of its negotiation,

 

7

CLASS ACTION COMPLAINT


1    structure, price and terms, is placed upon the Individual Defendants as a matter of law.
   CLASS ACTION ALLEGATIONS
2   

33. Plaintiffs bring this action pursuant to §382 of the California Code of Civil

3    Procedure on their own behalf and as a class action on behalf of all common stockholders of
4    Silicon Storage who are being and will be harmed by defendants’ actions described below (the
5    “Class”). Excluded from the Class are defendants herein and any person, firm, trust,
6    corporation, or other entity related to or affiliated with any defendants, or their principals or
7    affiliates.
8   

34. This action is properly maintainable as a class action.

9   

35. The Class is so numerous that joinder of all members is impracticable. As of

10    October 31, 2009, the Company had over 95 million shares of common stock outstanding held
   by scores, if not hundreds of individuals and entities scattered throughout America.
11   

36. There are questions of law and fact which are common to the Class and

12    predominate over questions affecting any individual Class member. These common questions
13    include, inter alia, the following:
14   

(a) whether the Individual Defendants have breached their fiduciary duty of

15   

undivided loyalty, independence, due care and/or candor with respect to plaintiffs and the other

16   

members of the Class in connection with the Proposed Transaction;

17   

(b) whether the Individual Defendants are engaging in self-dealing in

18   

connection with the Proposed Transaction;

19   

(c) whether the Individual Defendants have breached their fiduciary duty to

20   

secure and obtain the best price reasonable under the circumstances for the benefit of Plaintiffs

21   

and the other members of the Class in connection with the Proposed Transaction;

22   

(d) whether defendants have breached any of their other fiduciary duties to

23   

Plaintiffs and the other members of the Class in connection with the Proposed Transaction,

24   

including the duties of good faith, diligence, candor and fair dealing;

25   

(e) whether the defendants have impeded or erected barriers to discourage

26   

other offers for the Company or its assets; whether the consideration payable to Plaintiffs and

27   

the Class is unfair and inadequate; and

28   

(f) whether Plaintiffs and the other members of the Class would be

 

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CLASS ACTION COMPLAINT


1   

irreparably harmed if the transactions complained of herein are consummated.

2   

37. Plaintiffs’ claims are typical of the claims of the other members of the Class and

   plaintiffs do not have any interests adverse to the Class.
3   

38. Plaintiffs are adequate representatives of the Class, have retained competent

4    counsel experienced in litigation of this nature and will fairly and adequately protect the
5    interests of the Class.
6   

39. The prosecution of separate actions by individual members of the Class would

7    create a risk of inconsistent or varying adjudications with respect to individual members of the
8    Class which would establish incompatible standards of conduct for the party opposing the Class.
9   

40. Plaintiffs anticipate that there will be no difficulty in the management of this

10    litigation. A class action is superior to other available methods for the fair and efficient
   adjudication of this controversy.
11   

41. Defendants have acted on grounds generally applicable to the Class with respect

12    to the matters complained of herein, thereby making appropriate the relief sought herein with
13    respect to the Class as a whole.
14    CAUSES OF ACTION
15    COUNT I
   (For Breach of Fiduciary Duty against the Individual Defendants)
16   

42. Plaintiffs repeat and reallege each allegation set forth herein.

17   

43. The defendants have violated fiduciary duties of care, loyalty, candor and

18    independence owed to the public shareholders of Silicon Storage.
19   

44. By the acts, transactions and courses of conduct alleged herein, defendants,

20    individually and acting as a part of a common plan, are attempting to unfairly deprive Plaintiffs
21    and other members of the Class of the true value of their investment in Silicon Storage.
22    Moreover, they have violated their fiduciary duties by entering into the Proposed Transaction
23    without regard to its fairness.
24   

45. As demonstrated by the allegations above, the Individual Defendants failed to

25    exercise the care required and breached their duties of loyalty, good faith and candor owed to
26    the shareholders of Silicon Storage.
27   

46. As a result of the actions of defendants, Plaintiffs and the Class have been and

28    will be irreparably harmed in that they have not and will not be provided complete and candid

 

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CLASS ACTION COMPLAINT


1    information concerning the Proposed Transaction, which information is in the possession of
2    defendants.
3   

47. Unless enjoined by this Court, the defendants will continue to breach their

4    fiduciary duties owed to Plaintiffs and the Class, and may consummate the Proposed
5    Transaction that will result in irreparable harm to the Class.
6   

48. Plaintiffs and the members of the Class have no adequate remedy at law. Only

7    through the exercise of this Court’s equitable powers can Plaintiffs and the Class be fully
8    protected from the immediate and irreparable injury which defendants’ actions threaten to
9    inflict.
10   

COUNT II

(For Aiding and Abetting the Individual Defendants’ Breach

of Fiduciary Duty against Silicon Storage and Prophet)

11   

49. Plaintiffs repeat and reallege each allegation set forth herein.

12   

50. Defendants Silicon Storage and Prophet are sued herein as aiders and

13    abettors of the breaches of fiduciary duties outlined above by the Individual Defendants,
14    as members of the Board and/or executives of Silicon Storage.
15   

51. The Individual Defendants breached their fiduciary duties of due care,

16    good faith, loyalty, and candor to the Silicon Storage stockholders by the actions alleged
17    supra.
18   

52. Such breaches of fiduciary duties could not and would not have occurred

19    but for the conduct of Defendant Silicon Storage, which, therefore, aided and abetted
20    such breaches via entering into the Proposed Transaction with Prophet.
21   

53. Defendants Silicon Storage and Prophet directly breached or aided and/or abetted

22    the Individual Defendants’ breaches of fiduciary duty to Plaintiffs and the other holders of
23    Silicon Storage stock. In connection with discussions regarding the Proposed Transaction,
24    Silicon Storage provided, and Prophet obtained, sensitive non-public information concerning
25    Silicon Storage’s operations and thus had unfair advantages which enabled it to acquire the
26    Company at an unfair and inadequate price.
27   
28   

 

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CLASS ACTION COMPLAINT


1   

54. Defendants Silicon Storage and Prophet had knowledge that it was aiding and

2    abetting the Individual Defendants’ breach of their fiduciary duties to the Silicon Storage
3    stockholders.
4   

55. Defendants Silicon Storage and Prophet rendered substantial assistance to the

5    Individual Defendants in their breach of their fiduciary duties to the Silicon Storage
6    stockholders.
7   

56. As a result of Silicon Storage’s and Prophet’s conduct of aiding and abetting the

8    Individual Defendants’ breaches of fiduciary duties, Plaintiffs and the other members of the
9    Class have been and will be damaged in that they have been and will be prevented from
   obtaining a fair price for their shares.
10   

57. As a result of the unlawful actions of Defendants Silicon Storage and Prophet,

11    Plaintiffs and the other members of the Class will be irreparably harmed in that they will not
12    receive fair value for Silicon Storage’s assets and business and will be prevented from
13    obtaining the real value of their equity ownership in the Company. Unless the actions of
14    Defendants Silicon Storage and Prophet are enjoined by the Court, it will continue to aid and
15    abet the Individual Defendants’ breach of their fiduciary duties owed to Plaintiffs and the
16    members of the Class, and will aid and abet a process that inhibits the maximization of
17    stockholder value.
18   

58. Plaintiffs and the other members of the Class have no adequate remedy at

19    law.
20    PRAYER FOR RELIEF
21   

WHEREFORE, Plaintiffs demand judgment and preliminary and permanent relief,

22    including injunctive relief, in their favor and in favor of the Class and against defendants as
23    follows:
24   

A. Declaring that this action is properly maintainable as a class action;

25   

B. Declaring and decreeing that the Merger Agreement was entered into in breach

26    of the fiduciary duties of the Individual Defendants and is therefore unlawful and
27    unenforceable;
28   

C. Rescinding, to the extent already implemented, the Proposed Transaction or any

   of the terms thereof,
  

 

11

CLASS ACTION COMPLAINT


1   

D. Preliminarily and permanently enjoining defendants, their agents, counsel,

2    employees and all persons acting in concert with them from consummating the Proposed
3    Transaction, unless and until the defendants provide Silicon Storage shareholders with an offer
4    that is fair, equitable, maximizes shareholder value;
5   

E. Directing the Individual Defendants to exercise their fiduciary duties to obtain a

6    transaction which is in the best interests of Silicon Storage’s shareholders and implement a
7    process for the sale of the Company designed to ensure that the highest possible price is
8    obtained;
9   

F. Awarding Plaintiffs the costs and disbursements of this action, including

10    reasonable attorneys’ and experts’ fees; and
11   

G. Granting such other and further relief as this Court may deem just and proper.

12    DATED: November 16, 2009   Respectfully Submitted,
13      BARRACK, RODOS, & BACINE
14      STEPHEN R. BASSER
15      SAMUEL M. WARD
16      /s/ Stephen R. Basser
17      STEPHEN R. BASSER
18      600 West Broadway, Suite 900
19      San Diego, CA 92101
20      Telephone:    (619) 230-0800
21      Facsimile:      (619) 230-1874
22      BARRACK, RODOS, & BACINE
23      DANIEL E. BACINE
24      JULIE PALLEY
25      3300 Two Commerce Square
26      2001 Market Street
27      Philadelphia, PA 19130
28      (215) 963-0600
     Attorneys for Plaintiff David Thompson

 

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CLASS ACTION COMPLAINT