As filed with the Securities and Exchange Commission on April 27, 2004
Registration No. 333-112599
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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AGERE SYSTEMS INC.
(Exact name of registrant as specified in its charter)
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Delaware 1110 American Parkway NE 22-3746606
(State or other jurisdiction Allentown, Pennsylvania 18109 (I.R.S. Employer
of incorporation or organization) (610) 712-1000 Identification Number)
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
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Jean F. Rankin, Esq.
Senior Vice President, General Counsel and Secretary
Agere Systems Inc.
1110 American Parkway NE
Allentown, Pennsylvania 18109
(610) 712-1000
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
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Approximate date of commencement of proposed sale to the public: As soon
as practicable after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. / /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. o
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The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
The information in this prospectus is not complete and may be changed. These
securities may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
Subject to completion dated April 27, 2004
AGERE SYSTEMS INC.
6,921,188 SHARES
CLASS A COMMON STOCK
The 6,921,188 shares of our Class A common stock offered by this
prospectus were originally issued by us in connection with our acquisition of
TeraBlaze, Inc. All the shares of our Class A common stock offered by this
prospectus may be sold from time to time by or on behalf of certain Agere
stockholders. See "Selling Stockholders" and "Plan of Distribution." The
shares were originally issued in an offering exempt from the registration
requirements of the Securities Act of 1933. In connection with the acquisition
of TeraBlaze, Inc., we agreed to register the shares of our Class A common
stock offered by this prospectus. We will not receive any of the proceeds from
the sale of the shares by the selling stockholders.
SEE "RISK FACTORS" BEGINNING ON PAGE 1 TO READ ABOUT RISKS YOU SHOULD
CONSIDER BEFORE BUYING OUR CLASS A COMMON STOCK.
Our Class A common stock, including the shares offered hereby, is listed
in the United States on the New York Stock Exchange under the symbol AGR.A.
The closing sale price of the Class A common stock on the New York Stock
Exchange on April 26, 2004 was $2.65 per share.
Our principal executive offices are located at 1110 American Parkway NE,
Allentown, Pennsylvania 18109, and our telephone number at that location is
(610) 712-1000.
The selling stockholders may sell all or a portion of the shares offered
hereby from time to time through public or private transactions on or off the
New York Stock Exchange, in negotiated transactions or otherwise, and at
prevailing market prices or negotiated prices, all as more fully described
under "Plan of Distribution."
You should rely only on the information contained in this prospectus,
including the information in the documents incorporated by reference. We have
not, and no dealer or salesman has, authorized any other person to provide you
with different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not, and no dealer
or salesman is, making an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted.
You should assume that the information appearing in this prospectus is
accurate only as of the date on the front cover of this prospectus. Our
business, financial condition, results of operations and prospects may have
changed since that date.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is __________, 2004.
TABLE OF CONTENTS
Page
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FORWARD-LOOKING STATEMENTS...................................................1
RISK FACTORS.................................................................1
THE COMPANY..................................................................8
RECENT DEVELOPMENTS..........................................................9
USE OF PROCEEDS..............................................................9
SELLING STOCKHOLDERS.........................................................9
PLAN OF DISTRIBUTION........................................................10
LEGAL MATTERS...............................................................12
EXPERTS.....................................................................12
AVAILABLE INFORMATION.......................................................12
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.............................12
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FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that are based on
current expectations, estimates, forecasts and projections about the industry
in which we operate and management's beliefs and assumptions. Words such as
"expects," "anticipates," "intends," "plans," "believes," "seeks,"
"estimates," variations of such words and similar expressions are intended to
identify such forward-looking statements. These statements are not guarantees
of future performance and involve risks, uncertainties and assumptions which
are difficult to predict. Therefore, actual outcomes and results may differ
materially from what is expressed or forecasted in such forward-looking
statements. Except as required under the federal securities laws and the rules
and regulations of the Securities and Exchange Commission, we do not have any
intention or obligation to update publicly any forward-looking statements
after we distribute this prospectus, whether as a result of new information,
future events or otherwise.
RISK FACTORS
The purchase of our common stock involves investment risks. You should
carefully consider the following risk factors, as well as the information
under the heading "Forward-Looking Statements," together with the other
information in this prospectus, before purchasing any of the shares. If any of
the following risks actually occurs, our business, financial condition or
results of operations could be materially adversely affected.
RISKS RELATED TO OUR BUSINESS
If we fail to keep pace with technological advances in our industry or if we
pursue technologies that do not become commercially accepted, customers may
not buy our products and our revenue may decline.
The demand for our products can change quickly and in ways we may not
anticipate because our industry is generally characterized by:
o rapid, and sometimes disruptive, technological developments;
o evolving industry standards;
o changes in customer requirements;
o limited ability to accurately forecast future customer orders;
o frequent new product introductions and enhancements; and
o short product life cycles with declining prices over the life cycle of
the product.
If we fail to make sufficient investments in research and development
programs in order to develop new and enhanced products and solutions, or if we
focus on technologies that do not become widely adopted, new technologies
could render our current and planned products obsolete, resulting in the need
to change the focus of our research and development and product strategies and
disrupting our business significantly.
The integrated circuit industry is intensely competitive, and our failure to
compete effectively could result in decreased revenue.
The market for integrated circuits is intensely competitive and subject
to rapid and disruptive technological change. We expect the intensity of
competition to continue to increase as existing competitors enhance and expand
their product offerings and as new participants enter the market. Increased
competition may result in price reductions, reduced gross margins and loss of
market share. We may not be able to compete successfully against existing or
future competitors, which may result in decreased revenue.
The size and number of our competitors vary across our product areas, as
do the resources we have allocated to the segments we target. Therefore, many
of our competitors have greater financial, personnel,
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production capacity and other resources than we have in a particular market
segment or overall. Competitors with greater financial resources may be able
to offer lower prices, additional products or services or other incentives
that we cannot match or offer. These competitors may be in a stronger position
to respond quickly to new technologies and may be able to undertake more
extensive marketing campaigns. They also may adopt more aggressive pricing
policies and make more attractive offers to potential customers, employees and
strategic partners. These competitors may make strategic acquisitions or
establish cooperative relationships among themselves or with third-parties to
increase their ability to gain market share.
Further, some of our competitors are currently selling commercial
quantities of products that we are sampling to our customers, that are still
in the initial stages of development or that we may develop in the future. By
being able to offer these products in commercial quantities before we do, our
competitors can establish significant market share, acquire design wins in
customer equipment programs and create a market position that we may be unable
to overcome once we have completed development and testing of that product.
A joint venture and other third-parties manufacture some of our products for
us. If these manufacturers are unable to fill our orders on a timely and
reliable basis, our revenue may be adversely affected.
We currently manufacture our integrated circuits through a combination
of internal capability, a joint venture and external sourcing with contract
manufacturers. The integrated circuit manufacturing industry has a history of
developing new manufacturing processes. We believe that the costs associated
with implementing new processes, including acquiring the necessary equipment
and building appropriate facilities, are increasing with each generation of
manufacturing processes. Because we do not want to make the financial
investments necessary for future processes, we plan to rely on third-party
contract manufacturers to make integrated circuits for us using any
manufacturing processes that we do not currently use internally. In fiscal
2003, approximately 46% of our revenue was derived from integrated circuits
manufactured by a joint venture or through other external sourcing
arrangements, and we expect this percentage to increase over time. To the
extent we rely on joint ventures and third-party manufacturing relationships,
we face the following risks:
o that they may not be able to develop manufacturing methods appropriate
for our products;
o that manufacturing costs will be higher than planned;
o that reliability of our products will decline;
o that they may be unwilling to devote adequate capacity to produce our
products;
o that they may not be able to maintain continuing relationships with our
suppliers; and
o that we may have reduced control over delivery schedules and costs of
our products.
If any of these risks were to be realized, we could experience an
interruption in supply or an increase in costs, which could adversely affect
our results of operations.
We have recently reduced our owned manufacturing capacity. In the event
of an increase in demand, failure to increase our manufacturing volumes or
obtain capabilities from third-parties may result in our not being able to
meet customer demand for our products, which could hurt our relationships with
our customers and result in our recording lower revenues than would be the
case if we had greater manufacturing capacity.
A widespread outbreak of an illness such as severe acute respiratory syndrome,
or SARS, could negatively affect our manufacturing, assembly and test, design
or other operations, making it more difficult and expensive to meet our
obligations to our customers, and could result in reduced demand from our
customers.
A widespread outbreak of an illness could adversely affect our
operations as well as demand from our customers. A number of countries in the
Asia/Pacific region have experienced outbreaks of SARS. As a result of
outbreaks such as these, businesses can be shut down temporarily and
individuals can become ill or quarantined.
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We have manufacturing and back-office operations in Singapore, assembly and
test and back-office operations in Thailand and design operations in China,
countries where outbreaks of SARS have occurred. If our operations are
curtailed because of SARS or other health issues, we may need to seek
alternate sources of supply for manufacturing or other services and alternate
sources can be more expensive. Alternate sources may not be available or may
result in delays in shipments to our customers, each of which would affect our
results of operations. In addition, a curtailment of our design operations
could result in delays in the development of new products. If our customers'
businesses are affected by SARS, they might delay or reduce purchases from us,
which could adversely affect our results of operations.
Our revenue and operating results may fluctuate because we expect to derive
most of our revenue from semiconductor devices and the integrated circuits
industry is highly cyclical, and because of other characteristics of our
business, and these fluctuations may cause our stock price to fall.
We expect to derive most of our revenue from the sale of integrated
circuits. Because the integrated circuits market segment is highly cyclical,
we may experience declines in our revenue that are primarily related to
industry conditions and not our products. This industry has experienced
significant downturns, often in connection with, or in anticipation of, excess
manufacturing capacity worldwide, maturing product cycles and declines in
general economic conditions.
We focus primarily on winning competitive selection processes to develop
products for use in our customers' equipment. These selection processes can be
lengthy. After winning and beginning a product design for a customer, that
customer may not begin volume production of their equipment for a period of up
to two years, if at all. Due to this lengthy design and development cycle, we
may experience delays from the time we begin incurring expenses until the time
we generate revenue from our products. We have no assurances that our
customers will ultimately market and sell their equipment or that such efforts
by our customers will be successful. Thus, we may never generate any revenue
from our products after incurring significant design and development
expenditures.
If we are not selected by a customer to provide a product, we may
experience significantly lower revenue later, as compared to prior periods
with more revenue from earlier design wins. In addition, sales of our products
for specific customer projects often begin and end abruptly, so revenue may
increase rapidly and later decrease just as quickly. The relative timing of
the beginning and end of our sales and design processes can make our revenues
less predictable.
Fluctuations in our revenue or operating results could cause our stock
price to decline, even if our results meet expectations. Further, stock prices
in our industry have recently been highly volatile for reasons that sometimes
are unrelated to the performance of the companies in the industry. These broad
fluctuations could adversely affect our stock price.
Because many of our current and planned products are highly complex, they may
contain defects or errors that are detected only after deployment in
commercial applications, and if this occurs, it could harm our reputation and
result in reduced revenues or increased expenses.
Our products are highly complex and may contain undetected defects,
errors or failures. These products can only be fully tested when deployed in
commercial applications and other equipment. Consequently, our customers may
discover errors after the products have been deployed. The occurrence of any
defects, errors or failures could result in:
o cancellation of orders;
o product returns, repairs or replacements;
o diversion of our resources;
o legal actions by our customers or our customers' end-users;
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o increased insurance costs; and
o other losses to us or to our customers or end-users.
Any of these occurrences could also result in the loss of or delay in
market acceptance of our products and loss of sales, which would harm our
business and adversely affect our results of operations. We have from time to
time experienced defects in our products and expect to experience defects in
the future. Because the trend in our industry is moving toward even more
complex products in the future, this risk will intensify over time and may
result in increased expenses.
Because our sales are concentrated on a limited number of key customers, our
revenue may materially decline if one or more of our key customers do not
continue to purchase our existing and new products in significant quantities.
Our customer base is highly concentrated. Our top 10 end-customers
accounted for approximately 60% of our revenue in fiscal 2003. If any one of
our key customers decides to purchase significantly less from us or to
terminate its relationship with us, our revenue may materially decline.
Because our strategy has generally been to develop long-term relationships
with a few key customers in the product areas in which we focus and we have a
long product design and development cycle for most of our products, we may be
unable to replace these customers quickly or at all. We could lose our key
customers or significant sales to our key customers because of factors beyond
our control, such as a significant disruption in our customers' businesses
generally or in a specific product line.
We are expanding, and may seek in the future to expand, into new areas, and if
we are not successful, our results of operations may be adversely affected.
We are currently developing products in new areas, including wireless
communications infrastructure, high-speed networking and consumer electronics.
We may seek to expand into additional areas in the future. We may expand
through internal development efforts, through acquisitions of companies or
technologies, or a combination of these methods.
Our efforts may not result in sales that are sufficient for us to recoup
our investment, and we may experience higher costs than we anticipated. For
example, we may not be able to manufacture our product at a competitive cost,
may need to rely on new suppliers or may find that the development efforts are
more costly or timing consuming than we had anticipated. Our products may
support protocols that are not widely adopted. Where we choose to develop
capabilities by acquiring another company, we may not be able to integrate the
other company successfully into our operations, which may mean that we have
difficulty retaining employees from the acquired company or integrating its
technology into our products. We may have difficulties entering markets where
competitors have strong market positions.
If we fail to attract, hire and retain qualified personnel, we may not be able
to develop, market or sell our products or successfully manage our business.
In some of our fields of operation, there are only a limited number of
people in the job market who possess the requisite skills. In the past we have
experienced difficulty in identifying and hiring sufficient numbers of
qualified engineers in many areas of our business as well as in retaining
employees. The loss of the services of any key personnel or our inability to
hire new personnel with the requisite skills could restrict our ability to
develop new products or enhance existing products in a timely manner, sell
products to our customers or manage our business effectively.
Because we are subject to order and shipment uncertainties, any significant
cancellations or deferrals could cause our revenue to decline or fluctuate.
We generally sell products pursuant to purchase orders that customers
may cancel or defer on short notice without incurring a significant penalty.
Cancellations or deferrals could cause us to hold excess inventory, which
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could adversely affect our results of operations. If a customer cancels or
defers product shipments, we may incur unanticipated reductions or delays in
our revenue. If a customer refuses to accept shipped products or does not pay
for these products in a timely manner, we could incur significant charges
against our income, which could materially and adversely affect our results of
operations.
If we do not achieve adequate manufacturing utilization, yields or volumes or
sufficient product reliability, our gross margins will be reduced.
Because the manufacturing costs at our owned and joint venture
manufacturing facilities are relatively fixed, efficient utilization of
manufacturing facilities and manufacturing yields are critical to our results
of operations. If we do not experience adequate utilization of our
manufacturing facilities, our results of operations may be adversely affected.
Lower than expected manufacturing yields could adversely affect our results of
operations and delay product shipments.
The manufacture of our products involves highly complex and precise
processes, requiring production in highly controlled and clean environments.
Changes in our manufacturing processes or those of our suppliers or
contractors, or the inadvertent use of defective or contaminated materials,
could significantly reduce our manufacturing yields and product reliability.
We have relatively high gross margin on the revenue we derive from the
licensing of our intellectual property, and a decline in this revenue would
have a greater impact on our net income than a decline in revenue from our
integrated circuits products.
The revenue we generate from the licensing of our intellectual property
has a higher gross margin compared to the revenue we generate from the sale of
our integrated circuits products. Although we have derived less than 7% of our
total revenue in recent years from the licensing of intellectual property, a
decline in this licensing revenue would have a greater impact on our
profitability than a similar decline in revenues from the sale of our
integrated circuits products.
If our customers do not qualify our products or manufacturing lines or the
manufacturing lines of our third-party suppliers for volume shipments, our
results of operations may be adversely affected.
Some customers will not purchase any of our products, other than limited
numbers of evaluation units, until they qualify the manufacturing line for the
product. We may not always be able to satisfy the qualifications. Delays in
qualification may cause a customer to discontinue use of our products and
result in a significant loss of revenue.
We conduct a significant amount of our sales activity and manufacturing
efforts outside the United States, which subjects us to additional business
risks and may adversely affect our results of operations due to increased
costs.
In fiscal 2003, we derived approximately 80% of our revenue from sales
of our products shipped to locations outside the United States. We also
manufacture a significant portion of our products outside the United States
and are dependent on non-U.S. suppliers for many of our parts. We intend to
continue to pursue growth opportunities in both sales and manufacturing
outside the United States. Operations outside the United States are subject to
a number of risks and potential costs, which could adversely affect our
revenue and results of operations, including:
o our brand may not be locally recognized, which may cause us to spend
significant amounts of time and money to build a brand identity;
o unexpected changes in regulatory requirements;
o inadequate protection of intellectual property in some countries outside
of the United States;
o currency exchange rate fluctuations;
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o international trade disputes;
o political and economic instability; and
o disruptions in international air transport systems.
We are subject to environmental, health and safety laws, which could increase
our costs and restrict our operations in the future.
We are subject to a variety of laws relating to the use, disposal,
clean-up of, and human exposure to, hazardous chemicals. Any failure by us to
comply with present and future environmental, health and safety requirements
could subject us to future liabilities or the suspension of production. In
addition, compliance with these or future laws could restrict our ability to
expand our facilities or require us to acquire costly pollution control
equipment, incur other significant expenses or modify our manufacturing
processes. If additional contaminants are discovered or additional cleanup
obligations imposed at these or other sites, we could be adversely affected.
We may be subject to intellectual property litigation and infringement claims,
which could cause us to incur significant expenses or prevent us from selling
our products. If we are unable to protect our intellectual property rights,
our business and prospects may be harmed.
Like other companies in the semiconductor industry, we are frequently
involved in litigation regarding patent and other intellectual property
rights. From time to time, we receive notices from third-parties of potential
infringement and receive claims of potential infringement when we attempt to
license our intellectual property to others. Defending these claims could be
costly and time consuming and would divert the attention of management and key
personnel from other business issues. The complexity of the technology
involved and the uncertainty of intellectual property litigation increase
these risks. Claims of intellectual property infringement also might require
us to enter into costly royalty or license agreements. However, we may be
unable to obtain royalty or license agreements on terms acceptable to us or at
all. In addition, third-parties may attempt to appropriate the confidential
information and proprietary technologies and processes used in our business,
which we may be unable to prevent and which would harm our business and
prospects.
We believe that financing has at times been difficult to obtain for companies
in our industry and if we need additional cash to fund our operations or to
finance future strategic initiatives, we may not be able to obtain it on
acceptable terms or at all.
We believe that lenders have at times been less willing to extend credit
to companies in the telecommunications and semiconductor industries, making
debt financing difficult to obtain. As described below under "Risks Related to
Our Separation from Lucent Technologies--we are limited in the amount of stock
that we can issue to raise capital because of potential adverse tax
consequences," in connection with our spin-off from Lucent Technologies, we
are restricted in our ability to issue stock in order to raise capital.
If we are not able to obtain sufficient funds on acceptable terms, we
may not have sufficient funds to take advantage of market opportunities or to
finance future strategic initiatives. Because of differences in voting power
and liquidity between our Class A common stock and Class B common stock, the
market price of the Class A common stock may be different from the market
price of the Class B common stock.
Our Class B common stock has greater voting power per share for the
election and removal of directors than our Class A common stock, and, as a
result, some investors may prefer the Class B common stock as a means of
investing in our company. The greater potential voting power may cause the
Class B common stock to trade at a higher market price than the Class A common
stock. On the other hand, the Class A common stock has historically had a
higher daily trading volume than the Class B common stock. As a result, the
Class A common stock may be more liquid than the Class B common stock and more
attractive to investors, which may cause the price of the Class A common stock
to be higher than the price of the Class B common stock.
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The development and evolution of markets for our integrated circuits are
dependent on factors over which we have no control. For example, if our
customers adopt new or competing industry standards with which our products
are not compatible or fail to adopt standards with which our products are
compatible, our existing products would become less desirable to our customers
and our sales would suffer.
The emergence of markets for our integrated circuits is affected by a
variety of factors beyond our control. In particular, our products are
designed to conform to current specific industry standards. Our customers may
not adopt or continue to follow these standards, which would make our products
less desirable to our customers and reduce our sales. Also, competing
standards may emerge that are preferred by our customers, which could also
reduce our sales and require us to make significant expenditures to develop
new products. To the extent that we are not able to effectively and
expeditiously adapt to new standards, our business will suffer.
Class action litigation due to stock price volatility or other factors could
cause us to incur substantial costs and divert our management's attention and
resources.
In the past, securities class action litigation often has been brought
against a company following periods of volatility in the market price of its
securities. Companies in the integrated circuit industry and other technology
industries are particularly vulnerable to this kind of litigation due to the
high volatility of their stock prices. Accordingly, we may in the future be
the target of securities litigation. Any securities litigation could result in
substantial costs and could divert the attention and resources of our
management.
RISKS RELATED TO OUR SEPARATION FROM LUCENT TECHNOLOGIES
We are limited in the amount of stock that we can issue to raise capital
because of potential adverse tax consequences.
In June 2002, Lucent Technologies completed our spin-off by distributing
to its stockholders all of our common stock it then owned. Under Section
355(e) of the Internal Revenue Code, Lucent will recognize a taxable gain on
that distribution if there are one or more acquisitions of our stock
representing 50% or more of our stock (by vote or value) and the stock
acquisitions are part of a plan or series of related transactions that
includes the spin-off. Any shares of our stock acquired within two years
before or after the spin-off are presumed to be part of such a plan unless we
can rebut that presumption. If an issuance of our stock causes the
distribution to be taxable to Lucent under Section 355(e), we would be
required to indemnify Lucent against that tax under our tax sharing agreement
with Lucent.
The shares of our Class A common stock issued in our initial public
offering are considered to be part of a plan that includes the spin-off, and
the shares of our Class A common stock that may be issued upon the conversion
of our 6.5% convertible subordinated notes may also be considered to be part
of a plan that includes the spin-off. Assuming that all of the convertible
notes were converted, approximately 45% of our outstanding shares may be
treated as acquired as part of such a plan.
Treasury Regulations issued in April 2002 provide safe harbors that may
be used to rebut the presumption that shares issued less than two years after
the spin-off are part of a plan that includes the spin-off. However, the
application of the safe harbors is not clear in many respects, and they might
not be available to us for future share issuances. As a result, Section 355(e)
limits our ability to issue shares to raise capital for at least two years
after the spin-off. However, the safe harbors in these new Treasury
Regulations generally provide that issuances of our stock pursuant to ordinary
course employee compensation arrangements (such as employee stock purchase
plans) will not be treated as acquisitions of our stock pursuant to a plan
that includes the spin-off.
We could incur significant tax liabilities and payment obligations if Lucent
fails to pay the tax liabilities attributable to Lucent under our tax sharing
agreement.
We have entered into a tax sharing agreement with Lucent that allocates
responsibility for tax liabilities between them and us. Under U.S. federal
income tax laws, Lucent and we are jointly and severally liable for Lucent's
federal income taxes attributable to periods prior to and including Lucent's
taxable year ended September
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30, 2001. This means that if Lucent were to fail to pay the taxes attributable
to it under the tax sharing agreement for those periods, we may be liable for
all or any part of these liabilities.
Because the Division of Enforcement of the Securities and Exchange Commission
is investigating matters brought to its attention by Lucent, our business may
be affected in a manner we cannot foresee at this time.
In late 2000, Lucent brought to the attention of the staff of the U.S.
Securities and Exchange Commission matters relating to its recognition of
revenue. Although Lucent has informed us that it has no reason to believe that
the investigation by the Division of Enforcement of the Securities and
Exchange Commission into these matters concerns our business and we are not
aware of any reason why the investigation would affect us, it is possible that
the results of the investigation may have an impact on us. Although the
investigation could result in no action being taken by the Securities and
Exchange Commission, if an action were taken and the investigation were found
to concern our business, the action could result in monetary fines or changes
in some of our financial and other practices and procedures that we are unable
to foresee at this time. In February 2003, Lucent announced that it had
reached a tentative settlement with the Securities and Exchange Commission
regarding these revenue recognition issues. To date, we believe that a final
settlement agreement has not been executed, and there can be no assurances
that a final settlement will be reached.
THE COMPANY
We design, develop, manufacture and sell integrated circuit solutions
for applications such as high-density storage, multiservice networking,
wireless data and personal computer connectivity applications. These solutions
form the building blocks for a broad range of computing and communications
applications. Integrated circuits are made using semiconductor wafers
imprinted with a network of electronic components. They are designed to
perform various functions such as processing electronic signals, controlling
electronic system functions and processing and storing data.
Our business operations are organized into two market-focused groups,
the Client Systems group, which serves the computing and consumer
communications market, and the Infrastructure Systems group, which serves the
networking equipment market. Each of these two groups is a reportable
operating segment. The segments each include revenue from the licensing of
intellectual property.
The Client Systems group delivers integrated circuits, software and
reference designs for applications including storage, wireless data and
personal computer connectivity, including hard disk drives and modems for
computers, data enabled mobile phones and wireless local area networking. The
Infrastructure Systems group delivers integrated circuit solutions for
multiservice networking to network equipment customers.
During fiscal 2003, we substantially completed a restructuring of our
business in response to significant declines in our revenue, particularly from
our telecommunications network equipment customers. We believe that these
customers were themselves experiencing significant declines in demand from
their customers. As part of this restructuring, we:
o sold our optoelectronic components business, including the manufacturing
facilities associated with that business;
o reduced our headcount;
o consolidated our operations into fewer facilities; and
o closed two integrated circuit wafer manufacturing facilities.
We were incorporated under the laws of the state of Delaware on August
1, 2000, as a wholly owned subsidiary of Lucent Technologies Inc. and became
fully independent from Lucent on June 1, 2002. Our principal executive offices
are located at 1110 American Parkway NE, Allentown, Pennsylvania 18109, and
our telephone number at that location is (610) 712-1000.
8
RECENT DEVELOPMENTS
We announced our financial results for the second quarter of fiscal 2004
on April 27, 2004. We reported net income of $74 million, or $0.04 per share,
for the second quarter of fiscal 2004 compared to a net loss of $125 million,
or $0.08 per share, and a net loss of $39 million, or $0.02 per share, for the
second quarter of fiscal 2003 and the first quarter of fiscal 2004,
respectively. Our net income for the second quarter of fiscal 2004 includes a
tax benefit of $82 million from a resolution with Lucent Technologies of
certain tax audit issues covered by our tax sharing agreement with Lucent. Our
revenues of $462 million for the second quarter of fiscal 2004 were a 4%
increase over revenues for the second quarter of fiscal 2003 but a 10%
decrease from the first quarter of fiscal 2004. The decrease in revenues from
the first quarter was due primarily to a decrease in sales of 3G chipsets for
mobile phones related to delays in 3G deployment. Actual revenues for the
second quarter of fiscal 2004 were slightly lower than the estimated revenue
range announced on March 17, 2004 due to lower-than-expected intellectual
property licensing revenues.
USE OF PROCEEDS
Agere will not receive any of the proceeds from the sale of shares by
the selling stockholders. See "Plan of Distribution."
SELLING STOCKHOLDERS
The following table sets forth (1) the number of shares of our Class A
common stock owned by each of the selling stockholders as of April 26, 2004,
which in each case represents beneficial ownership of less than 1% of the
shares of our Class A common stock outstanding on that date, and (2) the
number of shares of our Class A common stock registered for sale hereby. No
estimate can be given as to the amount of shares that will be held by the
selling stockholders after completion of this offering because the selling
stockholders may offer all or some of the shares and because, to our
knowledge, there currently are no agreements, arrangements or understandings
with respect to the sale of any of the shares. The shares offered by this
prospectus may be offered from time to time by the selling stockholders named
below.
Shares Number of Shares
Beneficially Registered For
Selling Stockholder Owned (4) Sale Hereby (4) (5)
---------------------------------------- --------------- ---------------------
Bay III, L.P. (1) 3,084,081 3,084,081
Bay III Entrepreneurs Fund, L.P. (1) 376,512 376,512
Goldman Sachs Direct Investment Fund
2000, L.P. (2) 432,575 432,575
The Goldman Sachs Group, Inc. (2)(3) 2,595,445 2,595,445
Stone Street Fund 2000, L.P. (2) 432,575 432,575
(1) Voting and investment control with respect to all shares of our Class A
common stock shown as beneficially owned by Bay III, L.P. and Bay III
Entrepreneurs Fund, L.P. are shared by Neal Dempsey, John Freidenrich,
Loring Knoblauch, Christopher Noble, Audrey Vallen, Dino Vendetti and
Bob Williams. Each such person is a managing member of Bay Management
Company 2000, LLC, a general partner of each of Bay III, L.P. and Bay
III Entrepreneurs Fund, L.P.
(2) The Goldman Sachs Group, Inc., which we refer to as GS Group, owns
directly 2,595,445 shares of our Class A common stock. GS Group and
certain of its affiliates may be deemed to own beneficially and
indirectly in the aggregate an additional 865,150 shares of our Class A
common stock through Goldman Sachs Direct Investment Fund 2000, L.P. and
Stone Street Fund 2000, L.P., which we refer to collectively as the GS
Limited Partnerships. GS Group and the GS Limited Partnerships are
affiliates of each other. An affiliate of GS Group is a general partner
of each GS Limited Partnership. Each GS Limited Partnership owns
directly 432,575 shares of our Class A common stock. Goldman, Sachs &
Co., an affiliate of GS Group and the GS Limited Partnerships, which we
refer to as GS & Co., acts as the investment manager for the GS Limited
Partnerships and exercises voting and investment control, through a
committee of senior managers employed in the private equity business of
GS & Co., over the shares of our Class A common stock which are owned by
GS Group and the GS Limited Partnerships and which are being registered
hereby. GS Group and GS & Co. each disclaims beneficial ownership of the
shares owned by the GS Limited Partnerships except to the extent of
their pecuniary interest therein.
9
(3) GS Group and GS & Co. may be deemed to beneficially own (a) shares of
our Class A common stock held in client accounts with respect to which
GS & Co. or employees of GS & Co. have voting and/or investment
discretion and (b) shares of our Class A common stock acquired in
ordinary course trading activities by GS & Co. or another subsidiary of
GS Group. As of April 26, 2004, the respective beneficial ownership of
such shares of our Class A common stock was (a) 373,134 shares held in
managed accounts and (b) 1,103,180 shares held in ordinary course
trading activities. GS & Co. and GS Group each disclaims beneficial
ownership of the shares held in managed accounts. GS & Co. and GS Group
each disclaims beneficial ownership of the shares acquired in ordinary
course trading activities except to the extent of their pecuniary
interest therein.
(4) 692,119 shares issued by Agere in connection with the acquisition of
TeraBlaze, Inc. are being held in escrow to satisfy indemnification
obligations of the selling stockholders in case of any claims by Agere
for (a) breach of warranties provided in the purchase agreement
regarding TeraBlaze, Inc. and its stockholders (including the selling
stockholders) and (b) breach of the covenants of TeraBlaze, Inc. or the
selling stockholders in the purchase agreement. All or a portion of the
shares held in escrow may be returned to Agere to satisfy the
indemnification obligations of the selling stockholders, which would
reduce the beneficial ownership of each of these selling stockholders by
its pro rata interest in the shares held in escrow that are so returned.
The shares held in escrow are included in the amounts shown in the
table.
(5) This prospectus and the registration statement of which this prospectus
is a part of also covers any additional shares of Class A common stock
that become issuable in connection with the shares registered for sale
hereby by reason of any stock dividend, stock split, recapitalization or
other similar transaction effected without the receipt of consideration
that results in an increase in the number of outstanding shares of our
Class A common stock.
Each of the selling stockholders was a stockholder of TeraBlaze, Inc.
immediately prior to Agere's acquisition of TeraBlaze. Except as described in
the following sentence, none of the selling stockholders were officers or
directors of TeraBlaze, Inc. prior to Agere's acquisition of TeraBlaze. Loring
Knoblach served as a director of TeraBlaze on behalf of Bay III, L.P. and Bay
III Entrepreneurs Fund, L.P. and Ankur Sahu served as a director of TeraBlaze
on behalf of Goldman Sachs Direct Investment Fund 2000, L.P., The Goldman
Sachs Group, Inc. and Stone Street Fund 2000, L.P. None of the selling
stockholders are officers or directors of Agere.
All the shares of our Class A common stock which are owned by The
Goldman Sachs Group, Inc., Goldman Sachs Direct Investment Fund 2000, L.P. and
Stone Street Fund 2000, L.P. and which are being registered hereby were
acquired by such entities as consideration in connection with Agere's
acquisition of TeraBlaze, Inc. These shares were acquired in the ordinary
course of the private equity business of The Goldman Sachs Group, Inc. and its
affiliates and not in connection with any broker-dealer activities. At the
time these shares were acquired, none of The Goldman Sachs Group, Inc.,
Goldman Sachs Direct Investment Fund 2000, L.P. and Stone Street Fund 2000,
L.P. had an agreement or understanding, directly or indirectly, with any
person to distribute the shares of our Class A common stock being registered
hereby.
The Goldman Sachs Group, Inc. and its affiliates from time to time
provide Agere with commercial banking and financial advisory services. At
present, Goldman Sachs Group, Inc. or its affiliates are providing foreign
currency exchange services to Agere.
Except as otherwise noted above, none of the selling stockholders has
had a material relationship with Agere within the past three years other than
as a result of the ownership of the shares or other securities of Agere.
PLAN OF DISTRIBUTION
Resales by selling stockholders
Agere is registering the shares on behalf of the selling stockholders.
Any or all of the selling stockholders may offer the shares from time to time,
either in increments or in a single transaction. The selling stockholders may
also decide not to sell all the shares they are allowed to sell under this
prospectus. The selling stockholders will act independently of Agere in making
decisions with respect to the timing, manner and size of each sale.
Costs and commissions
Agere will pay all costs, expenses and fees in connection with the
registration of the shares. The selling stockholders will pay all brokerage
commissions, discounts and other expenses, if any, relating to the sale of
shares.
10
Types of sale transactions
The selling stockholders will act independently of Agere in making
decisions with respect to the timing, manner and size of each sale.
The selling stockholders may sell the shares described in this
prospectus directly to purchasers or to or through broker-dealers, which may
act as agents or principals. Such broker-dealers may receive compensation in
the form of discounts, concessions or commissions from the selling
stockholders and/or the purchasers of shares for whom such broker-dealers may
act as agents or to whom they sell as principal, or both (which compensation
as to a particular broker-dealer might be in excess of customary commissions).
The selling stockholders may also transfer, devise or gift these shares by
other means not described in this prospectus. As a result, pledgees, donees,
transferees or other successors-in-interest that receive such shares as a
gift, partnership distribution or other transfer may offer shares covered by
this prospectus. In addition, if any shares covered by this prospectus qualify
for sale pursuant to Rule 144 under the Securities Act, the selling
stockholders may sell such shares under Rule 144 rather than pursuant to this
prospectus.
The selling stockholders may sell the shares from time to time in one or
more transactions:
o at fixed prices that may be changed;
o at market prices prevailing at the time of sale;
o at prices related to such prevailing market prices; or
o at negotiated prices.
The selling stockholders may offer the shares in one or more of the
following transactions (which may include block trades and crosses):
o on any national securities exchange or quotation service on which the
Class A common stock may be listed or quoted at the time of sale,
including the New York Stock Exchange;
o in the over-the-counter market;
o in privately negotiated transactions;
o through put or call options;
o by pledge to secure debts and other obligations;
o by a combination of the above methods of sale; or
o to cover short sales.
In effecting sales, brokers or dealers engaged by the selling
stockholders may arrange for other brokers or dealers to participate in the
resales. The selling stockholders may enter into hedging transactions with
broker-dealers or other financial institutions, and in connection with those
transactions, broker-dealers or other financial institutions may engage in
short sales of our Class A common stock. The selling stockholders also may
sell shares short and deliver the shares to close out such short positions;
provided that the short sale is made after the registration statement has been
declared effective and a copy of this prospectus is delivered in connection
with the short sale. The selling stockholders also may enter into option or
other transactions with broker-dealers or other financial institutions that
require the delivery to the broker-dealer or other financial institution of
the shares, which the broker-dealer or other financial institution may resell
pursuant to this prospectus. The selling stockholders also may loan or pledge
the shares to a broker, dealer or other financial institution, and upon a
default, the broker, dealer or other financial institution may effect sales of
the loans or pledged shares pursuant to this prospectus.
The selling stockholders and any underwriters, broker-dealers or agents
that act in connection with the sale of the shares may be deemed
"underwriters" within the meaning of the Securities Act. As underwriters, any
profits on the resale of the shares sold by them while acting as principals
and any compensation to be received by an underwriter, broker-dealer or agent
could be deemed underwriting discounts or commissions under the Securities
Act.
To our knowledge, the selling stockholders have not entered into any
agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of the shares, nor is there an underwriter
or coordinating broker acting in connection with the proposed sale of shares
by the selling stockholders.
11
Indemnification
The selling stockholders may agree to indemnify any agent, dealer or
broker-dealer that participates in transactions involving sales of shares
against certain liabilities, including liabilities arising under the
Securities Act.
Prospectus delivery requirements
Because a selling stockholder may be deemed an underwriter, the selling
stockholder must deliver this prospectus and any supplements to this
prospectus in the manner required by the Securities Act. This might include
delivery through the facilities of the New York Stock Exchange in accordance
with Rule 153 under the Securities Act.
Arrangements with broker-dealers
Upon our being notified by the selling stockholders that any material
arrangement has been entered into with a broker-dealer for the sale of shares
through a block trade, special offering, exchange distribution or secondary
distribution or a purchase by a broker-dealer, a supplement to this prospectus
will be filed, if required, under Rule 424(b) under the Securities Act,
disclosing relevant information regarding such arrangement.
LEGAL MATTERS
The validity of the shares offered hereby will be passed upon for us by
Jean F. Rankin, Senior Vice President, General Counsel and Secretary of Agere.
As of April 19, 2004, Ms. Rankin owned 49,021 shares of Class A common stock
and restricted stock units and 2,383 shares of Class B common stock and had
options to acquire 2,284,879 additional shares of Class A common stock.
EXPERTS
The financial statements incorporated in this prospectus by reference to
the Annual Report on Form 10-K for the year ended September 30, 2003 have been
so incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
AVAILABLE INFORMATION
The prospectus constitutes a part of the registration statement on Form
S-3, which we have filed with the Securities and Exchange Commission with
respect to the Class A common stock offered hereby. This prospectus does not
contain all of the information in the registration statement. For further
information about us and our securities, see the registration statement and
its exhibits. The registration statement and the exhibits to the registration
statement, as well as the annual (containing audited financial statements),
quarterly and current reports, proxy statements and other information we file
with the Securities and Exchange Commission, may be read and copied at the
Securities and Exchange Commission's Public Reference Room at 450 Fifth
Street, N.W., Room 1024, Washington, DC 20549. You can get information about
the operation of the Public Reference Room by calling the Securities and
Exchange Commission at 1-800-SEC-0330. In addition, the Securities and
Exchange Commission maintains a Web site which provides online access to
periodic reports, proxy and information statements and other information
regarding registrants that file electronically with the Securities and
Exchange Commission at the address http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We "incorporate by reference" the information that we file with the
Securities and Exchange Commission, which means that we are disclosing
important information to you in those documents. The information incorporated
by reference is an important part of this prospectus, and information that we
subsequently file with the Securities and Exchange Commission will
automatically update and supercede information in this prospectus and in our
other filings with the Securities and Exchange Commission. Any statement
contained in a document incorporated or
12
deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this document to the extent that a statement
contained herein or in any subsequently filed document or report that also is
or is deemed to be incorporated by reference herein modifies or supersedes
such statement. Any such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
document. We incorporate by reference the documents listed below, which we
have already filed with the Securities and Exchange Commission, and any future
filings that we make with the Securities and Exchange Commission under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
(other than information furnished pursuant to Item 9 or Item 12 of any Current
Report on Form 8-K):
(a) Our Annual Report on Form 10-K for the fiscal year ended September
30, 2003, filed with the Securities and Exchange Commission on December 8,
2003.
(b) Our Quarterly Report on Form 10-Q for the quarter ended December 31,
2003, filed with the Securities and Exchange Commission on February 4, 2004.
(c) The description of our Class A common stock contained in our
registration statement on Form 8-A, filed on March 16, 2001, including any
amendment or reports filed for the purpose of updating that description.
You may request a copy of these filings and any exhibits specifically
incorporated by reference in these filings at no cost by writing or
telephoning us at the following address:
Investor Relations
Agere Systems Inc.
c/o The Bank of New York
P.O. Box 11082
Church Street Station
New York, New York 10286-1082
(866) 243-7347
13
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
SEC registration fee.................................$ 3,271
New York Stock Exchange listing fee..................$ 13,150
Accounting fees and expenses.........................$ 10,500
Legal fees and expenses..............................$ 20,000
Miscellaneous expenses...............................$ 1,079
------------
Total ...............................................$ 48,000
All of the amounts shown are estimates except the SEC registration fee
and the New York Stock Exchange listing fee. Agere will pay all expenses of
registration, issuance and distribution of the shares being sold by the
selling stockholders, excluding fees and expenses of counsel to the selling
stockholders and any brokerage commissions, discounts and fees and other
expenses relating to the sale of the shares, which shall be borne by the
selling stockholders.
Item 15. Indemnification Of Directors And Officers.
Section 145 of the General Corporation Law of the State of Delaware
provides that a corporation may indemnify directors and officers as well as
other employees and individuals against expenses including attorneys' fees,
judgments, fines and amounts paid in settlement in connection with various
actions, suits or proceedings, whether civil, criminal, administrative or
investigative other than an action by or in the right of the corporation, a
derivative action, if they acted in good faith and in a manner they reasonably
believed to be in or not opposed to the best interests of the corporation,
and, with respect to any criminal action or proceeding, if they had no
reasonable cause to believe their conduct was unlawful.
A similar standard is applicable in the case of derivative actions,
except that indemnification only extends to expenses including attorneys' fees
incurred in connection with the defense or settlement of such actions, and the
statute requires court approval before there can be any indemnification where
the person seeking indemnification has been found liable to the corporation.
The statute provides that it is not exclusive of other indemnification that
may be granted by a corporation's by-laws, disinterested director vote,
stockholder vote, agreement or otherwise. Our certificate of incorporation
provides that each person who was or is made a party or is threatened to be
made a party to or is involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that
such person, or a person of whom such person is the legal representative, is
or was a director or officer of us or is or was serving at our request as a
director, officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of such proceeding is the
alleged action of such person in an official capacity as a director, officer,
employee or agent or in any other capacity while serving as a director,
officer, employee or agent, will be indemnified and held harmless by us to the
fullest extent authorized by the General Corporation Law of the State of
Delaware, as the same exists or may hereafter be amended against all expense,
liability and loss reasonably incurred or suffered by such person in
connection therewith.
Our certificate of incorporation also provides that we will pay the
expenses incurred in defending any such proceeding in advance of its final
disposition, subject to the provisions of the General Corporation Law of the
State of Delaware. Such rights are not exclusive of any other right which any
person may have or thereafter acquire under any statute, provision of the
certificate, by-law, agreement, vote of stockholders or disinterested
directors or otherwise. No repeal or modification of such provision will in
any way diminish or adversely affect the rights of any director, officer,
employee or agent of us thereunder in respect of any occurrence or matter
arising prior to any such repeal or modification.
Our certificate of incorporation also specifically authorizes us to
maintain insurance and to grant similar indemnification rights to our
employees or agents.
II-1
The General Corporation Law of the State of Delaware permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability for:
o any breach of the director's duty of loyalty to the corporation or its
stockholders;
o acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law;
o payments of unlawful dividends or unlawful stock repurchases or
redemptions; or
o any transaction from which the director derived an improper personal
benefit.
Our certificate of incorporation provides that none of our directors
will be personally liable to us or our stockholders for monetary damages for
breach of fiduciary duty as a director, except, if required by the General
Corporation Law of the State of Delaware as amended from time to time, for
liability:
o for any breach of the director's duty of loyalty to us or our
stockholders;
o for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law;
o under Section 174 of the General Corporation Law of the State of
Delaware, which concerns unlawful payments of dividends, stock purchases
or redemptions; or
o for any transaction from which the director derived an improper personal
benefit.
Neither the amendment nor repeal of such provision will eliminate or
reduce the effect of such provision in respect of any matter occurring, or any
cause of action, suit or claim that, but for such provision, would accrue or
arise prior to such amendment or repeal.
Item 16. Exhibits And Financial Statement Schedules.
2 Agreement and Plan of Merger, dated as of December 31, 2003, by and
among Agere Systems Inc., Agere Systems Acquisition LLC, TeraBlaze,
Inc. and each of the stockholders of TeraBlaze, Inc. signatory thereto
(previously filed).
4.1 Certificate of Incorporation (incorporated by reference to Exhibit 4.1
to Registration Statement (No. 333-58324) on Form S-8).
4.2 By-laws (incorporated by reference to Exhibit 3.2 to Registration
Statement (No. 333-51594) on Form S-1).
4.3 Rights Agreement between the registrant and The Bank of New York, as
rights agent, dated as of March 26, 2001 (incorporated by reference to
Exhibit 4.2 to Registration Statement (No. 333-58324) on Form S-8).
4.4 Specimen Class A common stock certificate (incorporated by reference to
Exhibit 4.1 to Registration Statement (No. 333-51594) on Form S-1).
5.1 Opinion of Jean F. Rankin, Senior Vice President, General Counsel and
Secretary of the registrant, as to the legality of the securities issued
(previously filed).
23.1 Consent of Independent Accountants (previously filed).
23.2 Consent of Jean F. Rankin is contained in the opinion of counsel filed
as Exhibit 5.1.
II-2
24 Power of Attorney (previously filed).
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during the period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Securities and Exchange
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in the
effective registration statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Securities and Exchange Commission by the registrant pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement on Form S-3 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Allentown, State of
Pennsylvania, on April 27, 2004.
By: /s/ John W. Gamble, Jr.
----------------------------
John W. Gamble, Jr.
Executive Vice President and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed by the following persons in
the capacities indicated on April 27, 2004.
Signature Title
--------- -----
/s/ John T. Dickson President, Chief Executive Officer and Director
------------------------------------
John T. Dickson
/s/ John W. Gamble, Jr. Executive Vice President and Chief Financial Officer
------------------------------------ (principal financial officer and principal
John W. Gamble, Jr. accounting officer)
* Director
------------------------------------
Richard L. Clemmer
* Director
------------------------------------
Rajiv L. Gupta
* Director
------------------------------------
Richard S. Hill
* Director
------------------------------------
Krish Prabhu
* Director
------------------------------------
Thomas P. Salice
* Director
------------------------------------
Rae F. Sedel
* Director
------------------------------------
Harold A. Wagner
* Director
------------------------------------
John A. Young
II-4
* By: /s/ John W. Gamble, Jr.
-------------------------
John W. Gamble, Jr.
Attorney-in-fact
II-5
EXHIBIT INDEX
Exhibit Number Description
2 Agreement and Plan of Merger, dated as of December 31, 2003,
by and among Agere Systems Inc., Agere Systems Acquisition
LLC, TeraBlaze, Inc. and each of thE stockholders of
TeraBlaze, Inc. signatory thereto (previously filed).
4.1 Certificate of Incorporation (incorporated by reference to
Exhibit 4.1 to Registration Statement (No. 333-58324) on Form
S-8).
4.2 By-laws (incorporated by reference to Exhibit 3.2 to
Registration Statement (No. 333-51594) on Form S-1).
4.3 Rights Agreement between the registrant and The Bank of New
York, as rights agent, dated as of March 26, 2001
(incorporated by reference to Exhibit 4.2 to Registration
Statement (No. 333-58324) on Form S-8).
4.4 Specimen Class A common stock certificate (incorporated by
reference to Exhibit 4.1 to Registration Statement (No.
333-51594) on Form S-1).
5.1 Opinion of Jean F. Rankin, Senior Vice President, General
Counsel and Secretary of the registrant, as to the legality
of the securities issued (previously filed).
23.1 Consent of Independent Accountants (previously filed).
23.2 Consent of Jean F. Rankin is contained in the opinion of
counsel filed as Exhibit 5.1.
24 Power of Attorney (previously filed).