Item 5.01 Changes in Control of Registrant.
As previously disclosed, on December 10, 2007, the Company, STMicroelectronics N.V.
(“Parent”) and Sophia Acquisition Corp. (“Purchaser”), a wholly-owned subsidiary of Parent, entered
into an Agreement and Plan of Merger (the “Merger Agreement”).
Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof,
Purchaser offered to purchase all outstanding shares of the Company’s Common Stock (the “Common
Stock”), including the Series A Preferred Stock purchase rights (the “Rights”, and together with
the Common Stock, the “Shares”) issued pursuant to the Preferred Stock Rights Agreement (the
“Rights Agreement”), dated as of June 27, 2002, as amended by Amendment to the Rights Agreement,
dated as of March 16, 2003, and as further amended by Amendment No. 2 to the Rights Agreement,
dated as of December 10, 2007, between the Company and Mellon Investor Services LLC, at a price of
$8.65 per Share, net to the holder thereof in cash, without interest, less any required withholding
taxes (the “Offer Price”), upon the terms and subject to the conditions set forth in the Offer to
Purchase, dated December 18, 2007 (the “Offer to Purchase”), and the related Letter of Transmittal
(which, together with the Offer to Purchase, as amended or supplemented, constitute the “Offer”).
Upon the expiration of the initial offering period of the Offer at 12:00 midnight, New York
City time, on Wednesday, January 16, 2008, Offeror accepted for payment approximately 34.6 million
Shares (including approximately 2.3 million shares tendered by notice of guaranteed delivery)
representing approximately 91.0% of the outstanding Shares. On January 17, 2008, Offeror commenced
a subsequent offering period for all remaining untendered Shares, during which time stockholders
may tender Shares for purchase at the Offer Price on the same terms and subject to the same
conditions set forth in the Offer, except that Shares tendered during the subsequent offering
period may not be withdrawn. Offeror will immediately accept for payment all Shares properly
tendered, as they are tendered, during the subsequent offering period and will pay the tendering
stockholders promptly after acceptance. The subsequent offering period will expire at 5:00 p.m.,
New York City time, on Wednesday, January 23, 2008, unless extended by Offeror.
Based on the per Share consideration of $8.65 and the number of Shares validly tendered and
accepted for payment at the end of the initial offering period (including shares tendered by notice
of guaranteed delivery), as of January 16, 2007, the value of the Shares purchased by Offeror in
connection with the Offer was approximately $299 million. The funds used by Offeror to purchase
the Shares were from cash on hand.
Pursuant to the terms and conditions of the Merger Agreement, Offeror will be merged with and
into the Company (the “Merger”) as soon as practicable after the expiration of the subsequent
offering period (as it may be extended). In connection with the Merger, each outstanding Share not
tendered in the Offer (other than Shares held by the Company, Parent and Offeror and Shares held by
stockholders who properly perfect appraisal rights under Delaware law) will be converted into the
right to receive the Offer Price. Following the consummation of the Merger, the Company will
continue as the surviving corporation and be a wholly-owned subsidiary of Parent.
Pursuant to the terms of the Merger Agreement, Offeror is entitled to designate up to such
number of directors, rounded up to the next whole number (but in no event more than one less than
the total number of directors on the Company’s Board of Directors (the “Board”)), on the Board as
shall give Offeror representation on the Board equal to the product of the total number of
directors on the Board (giving effect to the directors elected pursuant to this sentence)
multiplied by the percentage that the aggregate number of Shares owned by Offeror or any affiliate
of Offeror following such purchase bears to the total number of Shares then outstanding. Offeror
has informed the Company that it does not intend to exercise this entitlement to appoint its
designees to the Company’s board of directors at this time. Offeror did, however, reserve the
right to exercise such entitlement at any time prior to the closing of the Merger, as permitted by
the Merger Agreement.
To the knowledge of the Company, except as set forth herein, there are no arrangements,
including any pledge by any person of securities of the Company, the operation of which may at a
subsequent date result in a further change in control of the Company.