-----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, IuYmRfKN+PokiOuWQtF7mpvw4RboSWMkwucN+PPt4TfAU+SxpMe/ds2aF7wpw0gh PitWshVilkb9t/cTocsHkw== 0000950005-98-000276.txt : 19980323 0000950005-98-000276.hdr.sgml : 19980323 ACCESSION NUMBER: 0000950005-98-000276 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980304 ITEM INFORMATION: FILED AS OF DATE: 19980319 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIANCE SEMICONDUCTOR CORP/DE/ CENTRAL INDEX KEY: 0000913293 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 770057842 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-22594 FILM NUMBER: 98568922 BUSINESS ADDRESS: STREET 1: 3099 N FIRST ST CITY: SAN JOSE STATE: CA ZIP: 95134-2008 BUSINESS PHONE: 4083834900 8-K 1 FORM 8-K 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): March 4, 1998 ALLIANCE SEMICONDUCTOR CORPORATION (Exact name of Registrant as specified in its charter) Delaware 0-22594 77-0057842 (State or other jurisdiction of (Commission (I.R.S. Employer incorporation) File Number) Identification No.) 3099 North First Street, San Jose, California 95134-2006 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (408) 383-4900 ------------------------------ Item 5. Other Events On March 4, 1998, the Registrant ("Alliance") entered into an agreement (the "Agreement") for the sale by Alliance of 35 million shares (the "Shares") of stock of United Semiconductor Corporation ("USC"), for a purchase price of 1.05 billion New Taiwan Dollars (approximately US$32.84 million at exchange rates prevailing on March 4, 1998). The sale is subject to certain conditions precedent, including receipt of approval from certain Taiwan regulatory authorities. Under the terms of the Agreement, if at any time a "Liquidity Event" occurs, Alliance will be entitled to receive, in addition to the initial payment of 1.05 billion New Taiwan Dollars, a contingent payment of up to 19 New Taiwan Dollars per Share, or up to an additional 665 million New Taiwan Dollars. Upon occurrence of a Liquidity Event, Alliance may elect to receive its contingent payment with respect to all or a portion of the Shares; provided that Alliance may only receive one contingent payment with respect to each Share; and provided further that Alliance may not request to receive a contingent payment with respect to fewer than five million Shares. Subject to the foregoing, Alliance may request contingent payments with respect to different portions of Shares in connection with different Liquidity Events. A "Liquidity Event" is defined as an event by which United Microelectronics Corporation ("UMC"), or its successor(s) with respect to USC shares, will have the opportunity to receive value from transfer of its ownership of shares of stock in USC in an arm-length transaction other than by way of transfer to employees for incentives, whether or not UMC or its successor(s) in fact participates in such opportunity. A Liquidity Event will include, for example, completion of a public offering of USC securities on a recognized securities exchange; a sale of USC stock owned by UMC or by a UMC successor in an arms-length transaction; or a sale of all or substantially all of the assets of USC. For purposes of the Agreement, a "successor" of UMC will be any entity which succeeds to and/or acquires from UMC, in the aggregate, more than 5 million shares of USC common stock under circumstances in which such transaction does not qualify as a Liquidity Event; there may be multiple successors to UMC under the Agreement, and there may be multiple Liquidity Events as to each separate successor. USC, a Taiwan corporation located in Hsin-Chu, Taiwan, is a foundry joint venture between Alliance, UMC and S3 Incorporated that was formed in 1995. Alliance paid approximately 1.95 billion New Taiwan Dollars for its 18.99% equity interest in USC. As a result of the sale of shares pursuant to the Agreement, Alliance's percentage ownership in USC will decrease to 15.49%. Alliance maintains its right to purchase up to approximately 25% of the manufacturing capacity of USC. Risk Factors All statements in this Report reflecting Alliance's anticipation of receiving funds are forward-looking; the risk factors set forth below could cause actual results to differ materially from those in the forward-looking statements. The parties must obtain approval from Taiwan government authorities (including the Hsin-Chu Science-Based Industrial Park authorities and the Taiwan Securities and Futures Commission) in order for funds to be transferred to Alliance pursuant to the Agreement. Alliance does not currently anticipate any difficulty in obtaining such approval, but there can be no assurance that such approval will not be delayed or withheld, either with respect to the initial payment or with respect to any contingent payment. Additionally, there is a risk that the party or parties obliged to make payment (initial or contingent) to Alliance may, due to reasons of credit or otherwise, be unwilling or unable to make payment to Alliance when due (assuming that requisite government approval for such payments is obtained). Moreover, payments to be made to Alliance pursuant to the Agreement will be calculated in New Taiwan Dollars. The exchange rate of the New Taiwan Dollar to the U.S. dollar is subject to material change, particularly in light of the uncertainties caused by the current financial and economic conditions in Asia; there can be no assurance that on the date or dates Alliance receives payments pursuant to the Agreement (assuming that requisite government approval for such payments is obtained and the obligor(s) makes such payments), the New Taiwan Dollar will not have materially deteriorated in value against the U.S. dollar as compared to the rate prevailing on March 4, 1998 (approximately 32 New Taiwan Dollars to one U.S. dollar). The forward-looking statements in this Report speak only as of March 19, 1998 (the date this Report is filed with the Securities and Exchange Commission). The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statement is based, in whole or in part. Item 7. Financial Statements and Exhibits (a) Financial statements of businesses acquired. Not applicable. (b) Pro forma financial information. Not applicable. (c) Exhibits. 10.1* Sale and Transfer Agreement dated as of March 4, 1998. * Confidential treatment has been requested for a portion of this document. Confidential portions omitted have been filed separately with the Securities and Exchange Commission. SIGNATURE 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. ALLIANCE SEMICONDUCTOR CORPORATION Dated: March 19, 1998 By: /s/ Charles Alvarez ---------------------------------- Charles Alvarez, Vice President -- Finance and Administration, and Chief Financial Officer EX-10.1 2 SALE AND TRANSFER AGREEMENT CONFIDENTIAL SALE AND TRANSFER AGREEMENT THIS SALE AND TRANSFER AGREEMENT (this "Agreement") is entered into as of March 4, 1998, by and between Alliance Semiconductor Corporation, a corporation organized under the laws of Delaware ("Alliance") and [*], a corporation organized under the laws of the Republic of China [*]. Alliance [*] own shares of stock in United Semiconductor Corporation ("USC"), a joint venture between S3 Incorporated ("S3"), UMC and Alliance pursuant to a Stock Purchase Agreement, dated as of June 30, 1996, as amended (the "Stock Purchase Agreement"). Alliance desires to sell and transfer to [*], and [*] desires to arrange the purchase from Alliance, all of Alliance's right, title and interest in and to Thirty-Five Million (35,000,000) shares of USC common stock (the "Shares"). For the consideration and on the terms and conditions set forth below, the parties agree as follows: 1. Sale and Transfer. Upon receipt of: (a) the consideration set forth in Section 2 below; and (b) a copy of the consent set forth below signed by S3, Alliance shall be deemed to have sold, assigned, transferred and conveyed to [*], free and clear of all liens charges and encumbrances, all of Alliance's right title and interest in the Shares. 2. Consideration. 2.1 Cash Payment. As soon as mutually agreeable following March 28, 1998, but in no event later than April 15, 1998, [*] shall deliver to Alliance, by wire transfer to an account specified by Alliance, the amount of Thirty New Taiwan Dollars (NT$30.00) per Share, for a total cash payment of One Billion Fifty Million New Taiwan Dollars (NT$ 1,050,000,000). Upon receipt of these funds, Alliance will make prompt payment of all amounts then due UMC and/or USC for foundry services, and will tender to [*] the certificates representing the Shares. 2.2 Contingent Payment. If, at any time after the date of this Agreement, a "Liquidity Event," as defined below, occurs with respect to shares of USC stock, then, in addition to the Cash Payment set forth in Section 2.1 above, [*] also will pay to Alliance the Contingent Payment calculated as follows: (a) Until such time as the Contingent Payment to Alliance has been made with respect to all of the Shares, within 15 days of each Liquidity Event, UMC shall notify Alliance in writing of the price per share of USC stock in New Taiwan Dollars achieved upon the Liquidity Event (the "Liquidity Price Per Share"). In the case of a public offering of USC shares of stock, the Liquidity Price Per Share shall be calculated as set forth in the immediately following paragraph of this Section 2.2(a). In the case of all other Liquidity Events, the Liquidity Price per Share shall be the price paid for USC shares of stock upon the closing of each such Liquidity Event. If UMC (or its successor in interest) is required under the laws of the Republic of China to sell a certain percentage of USC shares in a public offering of USC shares (the "Mandatory Sale Percentage") at a certain price (the Mandated Price Per Share), and Alliance elects to treat such a mandatory sale as a Liquidity Event, then the Liquidity Price Per Share for such shares shall be the Mandated Price Per Share, provided that in no such case shall the Liquidity Price Per Share paid to Alliance be less than the offering price for such shares of stock at the time of the public offering. Notwithstanding the foregoing, to the extent that UMC or any successor sells more than the Mandatory Sale Percentage of USC shares in such a public offering, the Liquidity Price Per Share for all shares so sold in excess of the Mandatory Sale Percentage shall be calculated based on the average closing price during the initial ten day period following the public offering. For example, if UMC is required to sell 40 Million USC shares in the initial public offering and UMC further sells an additional 40 Million USC shares beyond those it is required to sell, and if Alliance elects to treat the mandatory sale as a Liquidity Event, then the Liquidity Price Per Share for the 40 Million shares Page 1 Confidential Treatment Requested. In this document, [*] denotes information for which confidential treatment has been requested. Confidential portions omitted have been filed separately with the Securities and Exchange Commission, pursuant to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended. CONFIDENTIAL which are mandated for sale shall be the price at which UMC is required to sell such shares, and the Liquidity Price Per Share for the additional 40 Million shares shall be the average closing price during the initial ten day period following the public offering. If USC pays or makes a dividend or other distribution in common stock, without consideration, on any class of capital stock of USC, or shall effect a subdivision of the outstanding shares of common stock into a greater number of shares of common stock (by stock split, reclassification or otherwise than by payment of a dividend in common stock or in any right to acquire common stock), or if the outstanding shares of common stock shall be combined or consolidated, by reclassification or otherwise, into a lesser number of shares of common stock, then the number of Shares and the Liquidity Price Per Share used to calculate the Contingent Payment shall be proportionately decreased or increased, as appropriate, with the objective that neither party shall benefit from a stock dividend, combination or subdivision in a manner which adversely impacts the Contingent Payment the other would receive or pay. (b) Alliance will inform [*] in writing within fifteen (15) days from its receipt of notice of Liquidity Event, whether Alliance elects to receive its Contingent Payment based on such Liquidity Event for a portion or all of the Shares, and/or whether Alliance instead elects to reserve its Contingent Payment for all or a portion of the Shares for a later Liquidity Event; provided however (i) once Alliance receives a Contingent Payment for a portion of the Shares, it may not request and will not be entitled to further or additional Contingent Payments for such portion, and (ii) Alliance will not be entitled under this Agreement to receive Contingent Payments for more than 35 Million shares of USC stock, and (iii) Alliance may not request to receive any Contingent Payment for portions of the Shares fewer than Five Million shares under this Agreement, but, subject to the foregoing, Alliance may request Contingent Payments with respect to different portions of the Shares in connection with different Liquidity Events. (c) If Alliance elects to receive its Contingent Payment for a specific Liquidity Event, the Contingent Payment for the Shares involved shall be calculated as follows: Contingent Payment Per Share = [*] provided that the Contingent Payment Per Share shall be subject to a cap or maximum equal to Nineteen New Taiwan Dollars (NT$19.00), so that the total amount paid to Alliance for each Share (NT $30 Per Share plus Contingent Payment Per Share) will not exceed Forty Nine New Taiwan Dollars (NT $49.00) per Share. For each specific Liquidity Event as to which Alliance elects to receive a Contingent Payment, the Contingent Payment will be equal to the following: multiply (the Contingent Payment Per Share for such Liquidity Event) times (the number of Shares as to which Alliance elected to receive the Contingent Payment with respect to that Liquidity Event). (d) If the Liquidity Event is a public offering of USC shares, then the Contingent Payment will be paid to Alliance on or before the date that is the earlier of (i) the termination date of any lock-up period applicable to UMC-owned shares of USC; and (ii) the date that is six (6) months after the Liquidity Event. As to all other Liquidity Events, the Contingent Payment will be paid to Alliance on or before the date that is 60 days after the Liquidity Event. (e) For purposes of this Agreement, a "Liquidity Event" shall mean any event by which UMC, or its successor will have the opportunity to receive value from transfer of its ownership of shares of stock in USC in an arms length transaction other than by way of transfer to employees for incentives, whether or not UMC or its successor, in fact, participates in such opportunity. A Liquidity Event will include, for example, completion of a public offering of USC securities on a recognized securities exchange; a sale of USC stock owned by UMC (or by a UMC successor) in an arms-length transaction; or a sale of all or substantially all or the assets of USC. For purposes of this Agreement, a "successor" and/or "successor in interest" of UMC will be any entity which succeeds to and/or acquires from UMC, in the aggregate, more than 5 million shares of USC common stock under circumstances in which such transaction does not qualify as a Liquidity Event under the terms of this Agreement; provided that where any such successor does not acquire all of UMC's shares of stock in USC, then there may be multiple successors and there may be multiple Liquidity Events as to each separate successor. Page 2 Confidential Treatment Requested. In this document, [*] denotes information for which confidential treatment has been requested. Confidential portions omitted have been filed separately with the Securities and Exchange Commission, pursuant to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended. 3. Consent. [*] assumes responsibility for obtaining any and all consents which may be required from S3 Incorporated as to the sale of Shares and will indemnify and hold Alliance harmless from and against any claim by S3 that such consents were not obtained. 4. Miscellaneous. Paragraphs 6.1 through 6.3 of the Stock Purchase Agreement, together with paragraph 9.9 of the Foundry Venture Agreement, are incorporated by reference as if set forth fully in this Agreement, in each case with this Agreement substituted for the Stock Purchase Agreement and Foundry Venture Agreement. The parties' duly authorized representatives as shown below have signed and committed them to this Agreement as of the date first set forth above. ALLIANCE SEMICONDUCTOR [*] CORPORATION By /s/ N. Damodar Reddy -------------------------- By [*] N. Damodar Reddy, President ----------------------- [*] Page 3 Confidential Treatment Requested. In this document, [*] denotes information for which confidential treatment has been requested. Confidential portions omitted have been filed separately with the Securities and Exchange Commission, pursuant to Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended. -----END PRIVACY-ENHANCED MESSAGE-----