Document:

Registration Rights Agreement

 Exhibit 4.3 
  

REGISTRATION RIGHTS AGREEMENT 
  
 This Registration Rights Agreement (the “Agreement”) is entered into as of as of March 31, 2003, among Argonaut Group Inc., a
Delaware corporation (the “Corporation”), and the other parties identified on the signature pages hereto (individually, a “Holder” and collectively, the “Holders”). 

 
 This Agreement is made pursuant to those certain Subscription Agreements,
and any amendments thereto by and among the Corporation and the Holders (the “Subscription Agreements”) pursuant to which the Holders each subscribed for shares of the Company’s Series A Mandatory Convertible Preferred
Stock, par value $.10 per share. The execution of this Agreement is a condition to the closing of the transactions contemplated by the Subscription Agreements. 
  

1.     Definitions.    As used herein, unless the context otherwise requires, the following terms
have the following meanings: 
  
 “Closing Date” is defined in Section 2.1. 
  
 “Commission” means the Securities and Exchange Commission or any other Federal agency at the time administering the Securities
Act. 
  
 “Common Stock” means the common
stock of the Corporation, par value $0.10 per share. 
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

  
 “Initiating Holder” is defined in
Section 2.2. 
  
 “Permitted Assignee(s)”
means an assignee or assignees permitted pursuant to paragraph 7 of this Agreement. The terms “Holder” and “Holders” as used herein shall include Permitted Assignee(s) except where the context explicitly limits those terms to
parties identified on the signature pages to this Agreement. 
  
 “Person” means a corporation, an association, a partnership, an organization, a business, an individual, a governmental or political subdivision thereof or a governmental agency. 
  
 “Piggyback
Notice” is defined in Section 2.3(a). 
  
 “Piggyback Registration” is defined in Section 2.3(a). 
  
 “Registration Expenses” means all expenses incident to the Corporation’s performance of or compliance with this Agreement,
including, without limitation, all registration, listing, filing and stock exchange and NASD fees, as applicable, all fees and expenses of complying with securities or blue sky laws, all word processing, duplicating and printing expenses (including

  

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expenses of printing certificates for Registrable Securities in a form eligible for deposit with The Depository Trust Company), messenger and delivery
expenses, any fees and disbursements of underwriters customarily paid by issuers or sellers of securities (excluding underwriting discounts and commissions), registrar and transfer agent’s fees, the fees and disbursements of counsel for the
Corporation and of its independent public accountants, including the expenses of “cold comfort” letters required by or incident to such performance and compliance, reasonable fees and expenses of one counsel to the Holders (selected by
Holders representing at least 50% of the Registrable Securities covered by each registration statement filed pursuant to Section 2 and the fees and expenses of any other Persons retained by the Corporation). 
  
 “Registrable Securities” means the Series A Preferred
Stock, the Common Stock issuable or issued upon conversion of the Series A Preferred Stock and any capital stock issued or issuable with respect to such shares by way of stock dividend, stock split or in connection with a combination of shares,
reclassification, recapitalization, merger, consolidation, reorganization or otherwise; provided, however, that securities shall cease to be Registrable Securities when (a) a registration statement with respect to the sale of such
securities shall have become effective under the Securities Act and such securities are disposed of in accordance with such registration statement, (b) sold as permitted by Rule 144 (or any successor provisions) under the Securities Act, or (c) they
cease to be outstanding. 
  
 “Securities
Act” means the Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. 
  
 “Selling Holder” is defined in Section 2.2.

  
 “Series A Preferred
Stock” means the Series A Mandatory Convertible Preferred Stock of the Corporation, par value $0.10 per share, the designation, preferences and rights of which are set forth in that certain Certificate of
Designations, Preferences and Rights filed with the Secretary of the state of Delaware on March    , 2003. 
  
 “Shelf Registration” is defined in Section 2.1. 
  
 2.     Registration Under Securities Act,
Etc. 
  
 2.1     Shelf
Registration. 
  
 The Corporation agrees to file as soon
as reasonably practicable after the closing of the transactions contemplated under the Subscription Agreements (the “Closing Date”) (but in no event later than 10 days after the effective date of SEC Registration Statement
No. 333-100321 and 60 days after the Closing Date) a registration statement with respect to all of the Registrable Securities on Form S-3 (or any other appropriate form) covering the offer and sale of the Registrable Securities by the Holders or
their Permitted Assignee(s) on a delayed and continuous basis pursuant to Rule 415 under the Securities Act (the “Shelf Registration”). The Corporation agrees to use its reasonable best efforts to have the Shelf Registration
declared effective no later than 120 days after the Closing Date and to keep the Shelf Registration with 
  

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respect to the Registrable Securities continuously effective, supplemented and amended, as required by the Securities Act, in order to permit the prospectus
forming a part thereof to be usable under the Securities Act by the Holders and their Permitted Assignees from the date the Shelf Registration is declared effective by the Commission; provided, however, that the effectiveness of the
Shelf Registration may be terminated with respect to the Registrable Securities if and to the extent that all of the Registrable Securities registered therein cease to be Registrable Securities in accordance with the terms hereof. The Corporation
shall be deemed not to have used its reasonable best efforts to keep the Shelf Registration effective if it voluntarily takes any action that would result in a holder of Registrable Securities not being able to offer and sell such Registrable
Securities, unless (a) such action is required by applicable law, or (b) upon the occurrence of any event that requires the Corporation to make changes in any registration statement or the prospectus in order that such registration statement or
prospectus does not contain an untrue statement of a material fact and does not omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of the prospectus, in light of the circumstances
under which they were made) not misleading, such action is taken by the Corporation in good faith and for valid business reasons and the Corporation thereafter promptly complies with the requirements of Section 2.5(g) below if the
Corporation has determined in good faith that there are no material legal or commercial impediments in so doing. Notwithstanding the forgoing, if the Corporation shall furnish to each holder of Registrable Securities, a certificate signed by the
President or chief financial officer of the Corporation stating that in the good faith judgment of the Board of Directors of the Corporation, it would be seriously detrimental to the Corporation and its stockholders for such Shelf Registration to be
amended or supplemented and it is therefore in the best interests of the Corporation and its stockholders to defer the amendment or supplement of such Shelf Registration, the Corporation shall have the right to defer taking action with respect to
such amendment or supplement for a period of not more than 30 calendar days after furnishing such certificate to each holder of Registrable Securities; provided, however, that the Corporation may not utilize this right more than a
total of 30 calendar days in any 12 month period. 
  
 Notwithstanding any other provision of this Agreement to the contrary, the Corporation shall cause (a) the Shelf Registration and the related prospectus and any amendment or supplement thereto to comply in all material respects with the
applicable requirements of the Securities Act and the rules and regulations of the Commission thereunder, (b) the Shelf Registration and any amendment thereto not to contain, when it becomes effective, an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and (c) any prospectus forming a part of the Shelf Registration, and any amendment or supplement to such prospectus, not to contain,
as of the date of such prospectus or amendment or supplement, any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading; provided, however, that the Corporation will have no obligations under this paragraph with respect to the Plan of Distribution as described in any prospectus related to the Shelf Registration or as
to any written information furnished to the Corporation through an instrument specifically stating that it is for use in the preparation of the Shelf Registration. 
  

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 The Corporation agrees to pay all Registration Expenses in connection with the Shelf Registration,
whether or not it becomes effective. 
  
 2.2     Demand Registration. 
  
 (a)   Request.    At any time a Shelf Registration is not effective pursuant to Section 2.1, upon the written request of one or more holders (each, an
“Initiating Holder”) of the Registrable Securities representing not less than 40% of the Registrable Securities then outstanding that the Corporation effect the registration under the Securities Act of all or part of such
Initiating Holders’ Registrable Securities (which written request shall specify the intended number of Registrable Securities to be disposed of by such holder(s) and the intended method of disposition thereof), the Corporation will promptly
give written notice of such requested registration to all registered holders of the Registrable Securities. The Corporation will use its reasonable best efforts to effect the registration under the Securities Act, including by means of a shelf
registration pursuant to Rule 415 under the Securities Act or any similar rule then in effect, if so requested in such request and the Corporation is then eligible to use such registration, of the Registrable Securities which the Corporation has
been so requested to register by (i) such Initiating Holders and (ii) all such other holders (such holders together with the Initiating Holders are hereinafter referred to as the “Selling Holders”) who by written request
(which written request shall specify the intended number of Registrable Securities to be disposed of by such holder(s) and the intended method of disposition thereof) given to the Corporation within 30 days after the giving of such written notice by
the Corporation request the Corporation to register all or part of their Registrable Securities, all to the extent requisite to permit the disposition of the Registrable Securities so to be registered; provided, that the Corporation shall not be
obligated to effect any registration hereunder, if the aggregate offering price of the Registrable Securities to be so registered is less than $2,000,000. 
  
 (b)   Registration of Other Securities.    Whenever the Corporation shall effect a registration pursuant
to this Section 2.2 in connection with an underwritten offering by one or more Selling Holders of Registrable Securities, no securities other than Registrable Securities shall be included among the securities covered by such registration unless the
managing underwriter of such offering shall have consented in writing to the inclusion of such other securities. The Corporation shall not enter into an agreement providing for the right to be included in any such offering with any of its security
holders (other than the Holders) unless such agreement shall be expressly subject to the provisions of this Section 2.2(b). 
  
 (c)   Registration Statement Form.    Registrations under this Section 2.2 shall be on such appropriate
registration form of the Commission as shall be selected by the Selling Holders of more than 50% of the Registrable Securities to be so registered and that shall be reasonably acceptable to the Corporation. 
  
 (d)   Effective Registration
Statement.    A registration request pursuant to this Section 2.2 shall not be deemed to have been effected (i) unless a registration statement with respect thereon has become effective, (ii) if after it has become
effective, such registration is interfered with by any stop order, injunction or other order or requirement of the Commission or other governmental agency or court for any reason not attributable to the Selling Holders and has 

  

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not thereafter become effective, (iii) if after it has become effective, such registration statement is withdrawn or abandoned by the Selling Holders due to
a material adverse change to the Corporation and less than 50% of the Registrable Securities included in such registration statement have been sold, or (iv) if the conditions to closing specified in the underwriting agreement, if any, entered into a
connection with such registration are not satisfied or waived, other than by reason of a failure on the part of the Selling Holders. 
  
 (e)   Selection of Underwriters.    The underwriter or underwriters of each underwritten offering of the
Registrable Securities to be so registered shall be selected by the Selling Holders of more than 50% of the Registrable Securities to be so registered, subject to the Corporation’s approval which will not be unreasonably withheld, conditioned,
or delayed. 
  
 (f)   Priority in Requested
Registration.    If the managing underwriter of any underwritten offering shall advise the Corporation in writing (with a copy to each Selling Holder of Registrable Securities requesting registration) that, in its
opinion, the number or amount of securities requested to be included in such registration exceeds the number or amount which can be sold in such offering within a price range acceptable to the Selling Holders of more than 50% of the Registrable
Securities requested to be included in such registration, the Corporation will include in such registration only the number or amount of Registrable Securities which the Corporation is so advised in writing (with a copy to each Selling Holder of
Registrable Securities requesting registration) by the managing underwriter can be sold in such offering. Any such limitation of Registrable Securities requested to be included in such registration shall be applied pro rata among the Selling
Holders requesting such registration on the basis of the aggregate number or amount of the Registrable Securities of such Selling Holders requested to be so registered. 
  
 (g)   Right to Postpone Registration.    Notwithstanding the forgoing, if the
Corporation shall furnish to each Selling Holder of Registrable Securities, a certificate signed by the President or chief financial officer of the Corporation stating that in the good faith judgment of the Board of Directors of the Corporation, it
would be seriously detrimental to the Corporation and its stockholders for such registration statement to be filed and it is therefore in the best interests of the Corporation and its stockholders to defer the filing of such registration statement,
the Corporation shall have the right to defer taking action with respect to such filing for a period of not more than 90 calendar days after receipt of the request of the Initiating Holders; provided, however, that the Corporation may
not utilize this right more than once in any 12 month period. 
  
 (h)   Limitations on Demand Registrations.    Notwithstanding anything in this Section 2.2 to the contrary, the Corporation will be required to effect, in the aggregate, without regard to the
holder of Registrable Securities making such request, one registration pursuant to this Section 2.2 and in the event that the Selling Holders are limited by the managing underwriter as to the number or amount of Registrable Securities requested for
registration by such Selling Holders, then the Corporation shall be required to effect one additional registration pursuant to this Section 2.2. 
  
 2.3     Piggyback Registrations. 
  

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 (a)   Right to Piggyback.    If at any time, the
Corporation proposes to file a registration statement under the Securities Act (except on Form S-4, Form S-8, or any successor forms thereto) whether or not for its own account (other than a registration effected pursuant to Section 2.2 hereof),
then the Corporation shall give written notice of such proposed filing to the holders of Registrable Securities at least 15 days before the anticipated filing date (the “Piggyback Notice”). The Piggyback Notice shall offer
such holders the opportunity to register such amount of Registrable Securities as each such holder may request (a “Piggyback Registration”). Subject to Section 2.3(b) hereof, upon the written request of any such holders of
Registrable Securities made within 10 days of the date of the Piggyback Notice (which request shall specify the aggregate number of the Registrable Securities to be registered and will also specify the intended method of disposition thereof), the
Corporation will use its reasonable best efforts to effect the registration under the Securities Act of all Registrable Securities which the Corporation has been so requested to register by the holders thereof, to the extent required to permit the
public disposition (without limitation or restriction as to amount or number of Registrable Securities to be sold) (in accordance with such intended methods thereof) of the Registrable Securities to be so registered; provided, however, that
if any time after giving written notice of the proposed filing and prior to the effective date of the registration statement filed in connection with such registration the Corporation shall determine for any reason not to pursue the effectiveness of
the registration, the Corporation shall give written notice of such determination to each holder of Registrable Securities and, thereupon, shall be relieved of its obligation to register any Registrable Securities in connection with such
registration (but not from its obligation to pay the Registration Expenses in connection therewith). The holders of Registrable Securities shall be permitted to withdraw all or part of the Registrable Securities from a Piggyback Registration at any
time prior to the effective date of such Piggyback Registration. 
  
 (b)   Priority on Piggyback Registrations.    The Corporation shall cause the managing underwriters of a proposed underwritten offering to permit holders of Registrable Securities requested
to be included in the registration for such offering to include all such Registrable Securities on the same terms and conditions as any similar securities, if any, of the Corporation or any selling security holder included therein; provided,
however, if the managing underwriters of such underwritten offering determine in good faith that the total number of securities that such holders, the Corporation, and any other persons having rights to participate in such registration, propose
to include in such offering is such as to materially and adversely affect the success of such offering, then (i) if such Piggyback Registration is a primary registration on behalf of the Corporation, the securities to be offered shall be allocated
as follows: (A) first, up to the full number of securities to be offered by the Corporation shall be included in such registration, (B) then to the extent an amount of securities recommended by the managing underwriters remains available, up to that
amount of securities shall be included in such registration for the account of the holders of the Registrable Securities (allocated among them pro rata in proportion to their respective dollar amounts of securities owned to the extent
necessary to reduce the total number of securities to be included in such offering to the amount recommended by such managing underwriters), and (C) to the extent an amount of securities recommended by the managing underwriters remains available, up
to that amount of securities shall be included in such registration for the account of all such other persons (allocated among 

  

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 them pro rata in proportion to the respective dollar amounts of securities owned to the extent necessary to reduce
the total number of securities to be included in such offering to the amount recommended by such managing underwriters), and (ii) if such Piggyback Registration is an underwritten secondary registration on behalf of the holders of securities of the
Corporation, the Corporation shall include in such registration: (A) first, up to the full number of securities of such persons exercising “demand” registration rights that in the opinion of such underwriter can be sold (allocated among
such holders as they may so determine), and (B) second, the number of securities included in such registration pursuant to this Section 2.3 in excess of the securities such persons exercising “demand” registration rights proposed to sell
that, in the opinion of such managing underwriter, can be sold (allocated pro rata on the basis of aggregate dollar amount of securities requested to be included therein). 
  
 (c)   No Liability for Delay.    So long as the Corporation complies with the
terms and conditions of this Agreement and its obligations hereunder, the Corporation shall not be held responsible for any delay in the filing or processing of a registration statement which includes any Registrable Securities nor for any delay in
requesting the effectiveness of such registration statement due to requests by holders of Registrable Securities pursuant to this Section 2.3. 
  
 2.4    “Market Stand-Off” Agreement. 
  
 (a)   Restrictions on Public Sale by Holders of Registrable Securities.    Each
holder of Registrable Securities which are covered by a registration statement filed pursuant to Sections 2.2 or 2.3, hereof agrees, if requested (pursuant to a timely written notice) by the managing underwriters in an underwritten offering, not to
effect any public sale or distribution of any of the Corporation’s securities, including a sale pursuant to Rule 144 (except as part of such underwritten offering), during the period beginning five days prior to, and ending 90 days after (or
such shorter period as may be agreed to by any managing underwriter of an underwritten offering effected pursuant to Sections 2.2 or 2.3), the closing date of each underwritten offering made pursuant to such registration statement, provided that
the Corporation shall have used its reasonable best efforts to cause all officers, directors and holders of 5% or more of the then outstanding equity securities of the Corporation to enter into similar agreements. 
  
 (b)   Restrictions on Public Sale by the Corporation and
Others.    The Corporation agrees (i) without the written consent of the managing underwriters in an underwritten offering of Registrable Securities covered by a registration statement filed pursuant to Sections 2.2 or 2.3
hereof, not to effect any public or private sale or distribution of its securities, including a sale pursuant to Regulation D under the Securities Act, during the period beginning five days prior to, and ending 90 days after (or such shorter period
as may be agreed to by any managing underwriter of an underwritten offering effected pursuant to Sections 2.2 or 2.3), the closing date of each underwritten offering made pursuant to such registration statement (except on Forms S-4 or S-8, or any
successor forms to such forms) and (ii) to use its reasonable best efforts to cause each holder of its securities purchased from the Corporation at any time on or after the date of this Agreement (other than securities purchased in a registered
public offering) to agree not to effect any public sale or distribution of any such securities during such periods, including a sale pursuant to Rule 144. 
  

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 2.5     Registration Procedures.    In
connection with any registration of any Registrable Securities under the Securities Act pursuant to Sections 2.1, 2.2 and 2.3, the Corporation will as expeditiously as possible: 
  
 (a)   prepare and (except as otherwise provided in Section 2.1) within 60 days after the end of the period
within which requests for registration may be given to the Corporation or in any event as soon thereafter as practicable file with the Commission the requisite registration statement to effect such registration and thereafter use its reasonable best
efforts to cause such registration statement to become effective; provided, however, that before filing a registration statement or prospectus or any amendments or supplements thereto required to be filed hereunder, the Corporation shall
furnish, without charge, to the holders of the Registrable Securities covered by such registration statement, their counsel and the managing underwriters, if any, copies of any such registration statement, prospectus, amendment or supplement, and of
all such documents proposed to be filed, which documents will be subject to the review of such holders, their counsel and such underwriters, if any, and the Corporation shall not file any such registration statement or prospectus or any amendments
or supplements thereto to which the holders of a majority of the Registrable Securities covered by such registration statement, their counsel, or the managing underwriters, if any, shall reasonably object, in writing, on a timely basis; 

 
 (b)   prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective and to comply with the provisions of the Securities Act with respect to the disposition
of all Registrable Securities covered by such registration statement for such period as shall be required for the disposition of all of such Registrable Securities in accordance with the intended methods of distribution set forth in such
registration statement which shall be to the reasonable satisfaction of the holders of Registrable Securities covered by such registration statement; 
  
 (c)   furnish to each holder of Registrable Securities covered by such registration statement, such number of conformed copies of such
registration statement and of each such amendment and supplement thereto (in each case including all exhibits), such number of copies of the prospectus contained in such registration statement (including each preliminary prospectus and any summary
prospectus) and any other prospectus filed under Rule 424 under the Securities Act, in conformity with the requirements of the Securities Act, and such other documents, as such holder may reasonably request; 
  
 (d)   (i) use its reasonable best efforts to register or
qualify all Registrable Securities and other securities covered by such registration statement under such other securities or blue sky laws of such states of the United States of America where an exemption is not available and as the holders of
Registrable Securities covered by such registration statement shall reasonably request, (ii) keep such registration or qualification in effect for so long as such registration statement remains in effect, and (iii) take any other action which may be
reasonably necessary or advisable to enable such holders to consummate the disposition in such jurisdictions of the securities to be sold by such holders, except that the Corporation shall not for any such purpose be required to qualify generally to
do business as a foreign corporation in any 

  

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jurisdiction wherein it would not but for the requirements of this subdivision (d) be obligated to be so qualified or to consent to general service of
process in any such jurisdiction; 
  
 (e)   use its
reasonable best efforts to cause all Registrable Securities covered by such registration statement to be registered with or approved by such other federal or state governmental agencies or authorities as may be necessary in the opinion of counsel to
the Corporation and counsel to the holders of Registrable Securities covered by such registration statement to enable such holders to consummate the disposition of such Registrable Securities; 
  
 (f)   in the case of an underwritten offering, use its
reasonable best efforts to furnish to each such holder a signed counterpart of 
  
 (i)   an opinion of counsel for the Corporation which can and shall be reasonably satisfactory to the holders of a majority of the Registrable Securities to be sold, and 
  
 (ii)   a “comfort” letter signed by
the independent public accountants who have certified the Corporation’s financial statements included or incorporated by reference in such registration statement, 
  
 covering substantially the same matters with respect to such registration statement (and the prospectus included therein) and, in the case
of the accountants’ comfort letter, with respect to events subsequent to the date of such financial statements, as are customarily covered in opinions of issuer’s counsel and in accountants’ comfort letters delivered to the
underwriters in underwritten public offerings of securities (and dated the dates such opinions and comfort letters are customarily dated); 
  
 (g)   (i) notify in writing each holder of Registrable Securities at any time when a prospectus relating to Registrable Securities covered
by such registration statement is required to be delivered under the Securities Act, (A) upon discovery that, or upon the happening of any event as a result of which, the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading, in the light of the circumstances under which they were made, and at the
request of any such holder promptly prepare and furnish to it a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, in the light of the circumstances under which they were
made, (B) of any request by the Commission or any other Federal or state governmental authority for amendments or supplements to a registration statement or related prospectus covering Registrable Securities or for additional information relating
thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of a registration statement covering Registrable Securities or the initiation of any proceeding for that purpose, or (D) of the receipt by the Corporation
of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of 

  

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any proceeding for such purpose and (ii) notify each holder of Registrable Securities covered by such registration statement when each registration statement
or any amendment thereto has been filed with the Commission and when each registration statement or any post-effective amendment thereto has become effective; 
  

(h)   use its reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of a registration statement, or
the lifting of any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction, at the earliest possible moment; 
  
 (i)   otherwise use it reasonable best efforts to comply with all applicable rules and regulations of the
Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months beginning with the first full calendar month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act, and promptly furnish to each such holder of Registrable Securities covered by the registration statement a copy of any amendment or supplement
to such registration statement or prospectus; 
  
 (j)   permit any holder of Registrable Securities which might be deemed, in the sole and exclusive judgment of such holder, to be an underwriter or a controlling person of the Corporation to participate in the preparation of
such registration or comparable statement and to require the insertion therein of material, furnished to the Corporation and the Corporation’s counsel in writing, which in the reasonable judgment of such holder and its counsel and the
Corporations’ counsel should be included; 
  
 (k)   enter into customary agreements (including an underwriting agreement, if such proposed registration is to be an underwritten offering, containing representations and warranties, conditions to closing and indemnification
and contribution obligations in customary form), use its reasonable best efforts to obtain any necessary consents, including without limitation any necessary consents of the Corporation’s lenders, in connection with any proposed registration
and sale of Registrable Securities; 
  
 (l)   provide and cause to be maintained a transfer agent and registrar (which, in each case, may be the Corporation) for all Registrable Securities covered by such registration statement from and after a date not later than
the effective date of such registration; 
  
 (m)   use its reasonable best efforts to (i) list all Common Stock covered by such registration statement on any national securities exchange on which Registrable Securities of the same class and, if applicable, series,
covered by such registration statement are then listed, or (ii) seek the authority for such Common Stock to be quoted on the NASDAQ or the National Market System of NASDAQ if the securities so qualify; and 
  
 (n)   take such other actions as are reasonably required in
order to expedite or facilitate the disposition of such Registrable Securities. 
  

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 (o)   The Corporation may require each holder of Registrable Securities as to which any
registration is being effected to furnish the Corporation such information regarding such holder and the distribution of such securities as the Corporation may from time to time reasonably request in writing. However, no holders of Registrable
Securities shall be required to make any representations or warranties to or agreements with the Corporation or any underwriter other than customary representations, warranties or agreements regarding such holder, such holder’s Registrable
Securities and such holder’s intended method of distribution and any other representation required by law. 
  
 (p)   Each holder agrees that upon receipt of any written notice from the Corporation of the happening of any event of the kind described
in subdivision (g)(i) of this Section 2.5, such holder will forthwith discontinue such holder’s disposition of Registrable Securities pursuant to the registration statement relating to such Registrable Securities until such holder’s
receipt of the copies of the supplemented or amended prospectus contemplated by subdivision (g)(i) of this Section 2.5 and, if so directed by the Corporation, will deliver to the Corporation (at the Corporation’s expense) all copies, other than
permanent file copies, then in such holder’s possession of the prospectus relating to such Registrable Securities current at the time of receipt of such notice. 
  
 2.6   Preparation; Reasonable Investigation.    In connection
with the preparation and filing of each registration statement under the Securities Act pursuant to this Agreement, the Corporation will give the holders of the Registrable Securities registered under such registration statement, and their
underwriters, if any, and their respective counsel and accountants the opportunity to participate in the preparation of such registration statement, each prospectus included therein or filed with the Commission, and, to the extent practicable, each
amendment thereof or supplement thereto, and give each of them such access to its books and records (to the extent customarily given to the underwriters of the Corporation’s securities), such opportunities to discuss the business of the
Corporation with its officers and the independent public accountants who have certified its financial statements as shall be necessary, in the opinion of such holders’, such underwriters’ and such respective counsel and accountants, to
conduct a reasonable investigation within the meaning of the Securities Act. 
  
 2.7     Indemnification. 
  
 (a)    Indemnification by the Corporation.    In the event of any registration of any securities of the
Corporation under the Securities Act, the Corporation will, and hereby does, indemnify and hold harmless, in the case of any registration statement filed pursuant to this Agreement, each seller of any Registrable Securities covered by such
registration statement, its directors, officers, partners, members, agents and affiliates and each other Person, if any, who controls such seller within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller or any such Person may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether commenced or threatened, in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any registration statement under which such securities were registered under the Securities Act, any preliminary prospectus, final prospectus
or summary prospectus contained therein, or any 

  

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amendment or supplement thereto, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the
statements therein in light of the circumstances in which they were made not misleading, and, subject to Section 2.7(c), the Corporation will reimburse any Holder, such seller, and each such director, officer, partner, member, agent, or affiliate
and controlling Person for any legal or any other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, liability, action or proceeding; provided, that the Corporation shall not be
liable in any such case to the extent that any such loss, claim, damage, liability (or action or proceeding in respect thereof) or expense arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission
made in such registration statement, any such preliminary prospectus, final prospectus, summary prospectus, amendment or supplement in reliance upon and in conformity with written information furnished to the Corporation through an instrument duly
executed by or on behalf of such seller or such controlling person, as the case may be, specifically stating that it is for use in the preparation thereof. Such indemnity shall remain in full force and effect regardless of any investigation made by
or on behalf of any Holder, such seller, or any such director, officer, partner, agent or affiliate or controlling person and shall survive the transfer of such securities by such seller. 
  
 (b)   Indemnification by the Selling Holders.    In connection with any
registration statement in which a holder of Registrable Securities is participating, each such holder will furnish to the Corporation in writing such information and affidavits as the Corporation reasonably requests for use in connection with any
such registration statement, any preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, and, to the extent permitted by law, each such holder hereby agrees to indemnify and hold
harmless the Corporation, its directors, officers and agents, and each other Person, if any, who controls the Corporation within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which such
seller or any such Person may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based
upon any untrue statement of any material fact or alleged untrue statement of any material fact contained in such registration statement, any preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein in light of the circumstances in which they were made not misleading, and, subject to
Section 2.7(c), each such Holders will reimburse the Corporation, its director, officers and agents and each other controlling Person, if any, for any legal or any other expenses reasonably incurred by them in connection with investigating or
defending any such loss, liability, action or proceeding; but only to the extent that it is contained in any written information or affidavit so furnished in writing by such holder; provided, that the obligation to indemnify will be
individual to each holder and will be limited to the net amount of proceeds received by such holder from the sale of Registrable Securities pursuant to such registration statement. 
  
 (c)   Notices of Claims, etc.    Promptly after receipt by an indemnified
party of written notice of the commencement of any action or proceeding involving a claim referred to in the preceding subdivisions of this Section 2.7, such indemnified party will, if a claim in respect 

  

 12 

 
thereof is to be made against an indemnifying party, give written notice to the latter of the commencement of such action, provided, that the
failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligation s under the preceding subdivisions of this Section 2.7, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is brought against an indemnified party, the indemnifying party shall be entitled to participate in and, unless in such indemnified party’s reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist in respect of such claim, to assume the defense thereof, jointly with any other indemnifying party similarly notified to the extent that it may wish, with one counsel reasonable
satisfactory to such indemnified party and all other indemnified parties that may be represented without conflict by one counsel, and after written notice from the indemnifying party to such indemnified party and all other indemnified parties that
may be represented without conflict by one counsel, and after written notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party
for any legal or other expenses subsequently incurred by the latter in connection with the defense thereof other that reasonable costs of investigation. No indemnifying party shall be liable for any settlement of any action or proceeding effected
without its written consent. No indemnifying party shall, without the consent of the indemnified party, consent to entry of any judgment or enter into any settlement, which does not include as an unconditional term thereof the giving by the claimant
or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation. 
  
 (d)   Contribution.    If the indemnification provided for in this Section 2.7 shall for any reason be
held by a court to be unavailable to an indemnified party under subparagraph (a) or (b) hereof in respect of any loss, claim, damage or liability, or any action in respect thereof, then, in lieu of the amount paid or payable under subparagraph (a)
or (b) hereof, the indemnified party and the indemnifying party under subparagraph (a) or (b) hereof shall contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with
investigating the same), (i) in such proportion as is appropriate to reflect the relative fault of the Corporation and the prospective sellers of Registrable Securities covered by the registration statement which resulted in such loss, claims,
damage or liability, or action in respect thereof, with respect to the statements or omissions which resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as shall be appropriate to reflect the relative benefits received by the Corporation and such prospective sellers from the offering of the securities
covered by such registration statement. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation. Such prospective sellers’ obligations to contribute as provided in this subparagraph (d) are several in proportion to the relative value of their respective Registrable Securities covered by such registration statement and
not joint. In addition, no Person shall be obligated to contribute hereunder any amounts in payment for any settlement of any action or claim effected without such Person’s consent, which consent shall not be unreasonable withheld. 

 

 13 

 (e)   Other Indemnification.    Indemnification and
contribution similar to that specified in the preceding subdivisions of this Section 2.7 (with appropriate modifications) shall be given by the Corporation and each seller of Registrable Securities with respect to any required registration or other
qualification of securities under any Federal or state law or regulation of any governmental authority other than the Securities Act. 
  
 (f)   Indemnification Payments.    The indemnities and contribution required by this Section 2.7 shall be
made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or expenses, loss, damage or liability is incurred. 
  
 (g)   Underwriting Agreement.    To the extent that the provisions regarding
indemnification and contribution contained in any underwriting agreement entered into in connection with an underwritten public offering of Registrable Securities are in conflict with the provisions of this Section 2.7, the provisions contained in
the underwriting agreement shall control. 
  
 2.8     Certain Other Agreements. 
  
 (a)    No agreement granting any registration rights to any Person with respect to any of the Corporation’s securities currently remains in force and effect. The Corporation will not hereafter
enter into any agreement with respect to its securities which is inconsistent with the rights granted to the holders of Registrable Securities in this Agreement, including without limitation entering into any agreement which would permit the
registration of any securities to the exclusion of any portion of the Registrable Securities, unless such exclusion is first waived in writing by the holders of more than 50% or the Registrable Securities then outstanding. Without limiting the
generality of the foregoing, any registration rights hereafter granted by the Corporation shall be subordinate to the registration rights granted under this Agreement, and the Corporation shall obtain the written agreement of each Person to whom
such other registration rights may be granted or may become available to such effect. 
  
 (b)   The Corporation will not effect or permit to occur, any combination or subdivision of Registrable Securities, which would adversely affect the ability of the holders of Registrable Securities to
include such Registrable Securities in any registration of its securities contemplated by this Section 2 or the marketability of such Registrable Securities under any such registration. 
  
 2.9      Certain Rights If Named in a Registration
Statement.    If any statement contained in a registration statement under the Securities Act refers to the holder of Registrable Securities by name or otherwise as the holder of any securities of the
Corporation, then such holder shall have the right to require (a) the insertion therein of language, in form and substance reasonably satisfactory to such holder, to the effect that the holding by such holder of such securities does not necessarily
make such holder a “controlling person” of the Corporation within the meaning of the Securities Act or (b) in the event that such reference to such holder by name or otherwise is not required by the Securities Act or any of the rules and
regulations promulgated thereunder, the deletion of the reference to such holder. 
  

 14 

 2.10     Registration
Expenses.    The Corporation shall pay the Registration Expenses in connection with any registration requested pursuant to this Section 2. 
  
 3.    Rule
144.    The Corporation shall take all actions reasonably necessary to enable the holders of Registrable Securities to sell such Securities without registration under the Securities Act within the limitation
of the exemptions provided by (a) Rule 144 under the Securities Act, as such Rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the Commission including, without limiting the generality of the
foregoing, filing on a timely basis all reports required to be filed by the Exchange Act. Upon the request of any holder of Registrable Securities, the Corporation will deliver to such holder a written statement as to whether it has complied with
such requirements. 
  
 4.     Amendments and Waivers.    This Agreement may be amended with the consent of the Corporation and the Corporation may take any action herein prohibited, or omit to perform any
act herein required to be performed by it, in each of the foregoing cases only if the Corporation shall have obtained the written consent to such amendment, action or omission to act, of the holder or holders of at least a majority of each issue of
the Registrable Securities at the time of such consent. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of holders or Registrable Securities
whose securities are being sold pursuant to a registration statement and that does not directly or indirectly affect the rights of other holders of Registrable Securities may be given by holders of least a majority of the Registrable Securities
being sold by such holders pursuant to such Registration Statement, provided, however, that the provisions of this sentence may not be amended, modified, or supplemented except in accordance with the provisions of the immediately preceding
sentence. 
  
 5.     Nominees for
Beneficial Owners.    In the event that any Registrable Securities are held by a nominee for the beneficial owner thereof, the beneficial owner thereof may, at its election in writing delivered to the
Corporation, be treated as the holder of such Registrable Securities for purposes of any request or other action by any holder or holders of Registrable Securities pursuant to this Agreement or any determination of any number or percentage of shared
of Registrable Securities held by any holder or holders of Registrable Securities contemplated by this Agreement. If the beneficial owner of any Registrable Securities so elects, the Corporation may require assurances reasonable satisfactory to it
of such owner’s beneficial ownership of such Registrable Securities. 
  
 6.      Notices.    All communications provided for hereunder shall be sent by postage prepaid first-class mail, receipted courier service or
facsimile telecommunication, shall be deemed to be received three days after being sent, or, if earlier, the date of actual receipt at the indicated address, and shall be addressed as follows: 
  
 (a)   if to any Holder or any transferee of Registrable
Securities, addressed to such person(s) at such address as shown on stock ledger of the Corporation; 
  

 15 

 (b) if to the Corporation, addressed to it at its principal executive officer or at such other address as
the Corporation shall have furnished to each holder of Registrable Securities at the time outstanding. 
  
 7.     Assignment; Calculation of Percentage Interests in Registrable Securities. 
  
 (a)    This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties hereto and their respective successors and assigns, including any Person to whom Registrable Securities are transferred; provided that the securities so transferred continue to be considered
Registrable Securities in the hands of such Person. 
  
 (b)    For purposes of this Agreement, all references to a percentage of the Registrable Securities shall be calculated based upon the number of such shares held by those holders needed to be included for purposes of
such calculation. 
  
 8.     Descriptive Headings.    The descriptive headings of the several sections and paragraphs of this Agreement are inserted for reference only and shall not limit
or otherwise affect the meaning hereof. 
  
 9.     Governing Law.    This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by the internal laws of the
State of Delaware. 
  
 10.     Counterparts.    This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all such counterparts shall
together constitute one and the same instrument. 
  
 11.     Remedies.    Any Person having rights under any provision of this Agreement will be entitled to enforce such rights specifically to
recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the
provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or other security) for specific performance and for other injunctive relief in order
to enforce or prevent violation of the provisions of this Agreement. 
  
 12.     Entire Agreement.    This Agreement embodies the entire agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements relating to such subject matter. 
  
 13.     Severability.    The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement. 
  
 14.     Further Assurances.    Each party to this Agreement hereby covenants and agrees, without the necessity of any further consideration, to
execute and deliver any and all such further documents and take any and all such other actions as may be necessary or appropriate to carry 

  

 16 

 
out the intent and purposes of this Agreement and to consummate the transactions contemplated hereby. 
  
 [signature pages follow] 
  

 17 

 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered by their respective officers
thereunto duly authorized as of the date first above written. 
  

	 CORPORATION:
 Argonaut
Group, Inc.

		
	 By:
	 	 /s/    Mark E. Watson III

	 Name:
	 	 Mark E. Watson III

	 Title:
	 	 President and Chief Executive Officer

	
	 Address for Notices:

	

	
	 10101 Reunion Place, Suite 500

	 San Antonio, Texas 78216

	 Fax No.: 210-377-2637

	 Telephone No.: 210-321-8400

	 Attention: General Counsel

  

 18 

	 HOLDERS:
 Houston Casualty Company

		
	 By:
	 	 /s/    Edward H. Ellis, Jr.

	 Name:
	 	 Edward H. Ellis, Jr.

	 Title:
	 	 Executive Vice President

	
	 Address for Notices:

	

	
	 13403 Northwest Freeway

	 Houston, Texas 77040

	 Fax No.: 713-744-9648

	 Telephone No.: 713-462-1000

	 Attention: General Counsel

	
	US Specialty Insurance Company
		
	 By:
	 	 /s/    Edward H. Ellis, Jr.

	 Name:
	 	 Edward H. Ellis, Jr.

	 Title:
	 	 Executive Vice President

	
	 13403 Northwest Freeway

	 Houston, Texas 77040

	 Fax No.: 713-744-9648

	 Telephone No.: 713-744-3700

	 Attention: General Counsel

	
	HCC Life Insurance Company
		
	 By:
	 	 /s/    Edward H. Ellis, Jr.

	 Name:
	 	 Edward H. Ellis, Jr.

	 Title:
	 	 Executive Vice President

	
	 Address for Notices:

	

	
	 13403 Northwest Freeway

	 Houston, Texas 77040

	 Fax No.: 713-744-9648

	 Telephone No.: 713-744-3700

	 Attention: General Counsel

  

 19 

	Avemco Insurance Company
		
	 By:
	 	 /s/    Edward H. Ellis, Jr.

	 Name:
	 	 Edward H. Ellis, Jr.

	 Title:
	 	 Executive Vice President

	
	 Address for Notices:

	

	
	 Frederick Municipal Airport

	 411 Aviation Way

	 Frederick, Maryland 21701

	 Fax No.: 301-694-4242

	 Telephone No.: 301-694-5700

	 Attention: General Counsel

  

 20 

	Century Capital Partners III, L.P.
	
	 By: CCP Capital III, L.P., its general partner

	
	By: CCP Capital III, Inc., its general partner
		
	 By:
	 	 /s/    Craig Eisenbacher

	 Name:
	 	 Craig Eisenbacher

	 Title:
	 	 Managing Director

	
	 Address for Notices:

	

	
	 Century Capital Management, Inc.

	 1 Liberty Square

	 Boston, MA 02109

	 Attention: Steven Alfano, Chief Financial Officer

	 Fax No.: 617-542-9398

  

 21Purchase Agreement dated 5/22/03

 Exhibit 4.5 
  
 $125,000,000 
  
 CHIPPAC, INC. 
  
 2-1/2% Convertible Subordinated Notes Due 2008 
  
 PURCHASE AGREEMENT 
  
 May 22, 2003 
  
 LEHMAN BROTHERS INC.

 745 Seventh Avenue 
 New York, New York 10019 
  
 Dear Sirs: 
  
 1.
Introductory. ChipPAC, Inc., a Delaware corporation (the “Company”), proposes, subject to the terms and conditions stated herein, to issue and sell to Lehman Brothers Inc. (the initial “Purchaser”)
U.S.$125,000,000 principal amount of its 2-1/2% Convertible Subordinated Notes Due 2008 (the “Firm Securities”) and also proposes to grant to the Purchaser an option, exercisable from time to time by Lehman Brothers Inc. to purchase
an aggregate of up to an additional $25,000,000 principal amount (“Optional Securities”) of its 2-1/2% Convertible Subordinated Notes Due 2008 each to be issued under an Indenture, dated as of May 28, 2003 (the
“Indenture”), between the Company and U.S. Bank National Association, as Trustee. The Firm Securities and the Optional Securities which the Purchaser may elect to purchase pursuant to Section 3 hereof are collectively called the
“Offered Securities”. The United States Securities Act of 1933 is herein referred to as the “Securities Act”. 
  
 The Offered Securities will be offered and sold to the Purchaser without being registered under the Securities Act in reliance upon an exemption
therefrom. Pursuant to the terms of the Offered Securities and the Indenture, the Purchaser and investors that acquire Offered Securities may only resell or otherwise transfer such Offered Securities if such Offered Securities are hereafter
registered under the Securities Act or if an exemption from the registration requirements of the Securities Act is available (including, without limitation, the exemption offered by Rule 144A, Rule 144 or Regulation S of the rules and regulations
under the Securities Act). The holders of the Offered Securities will be entitled to the benefits of a Registration Rights Agreement dated the First Closing Date (as hereinafter defined) between the Company and the Purchaser (the
“Registration Rights Agreement”), pursuant to which the Company agrees to file a Shelf Registration Statement (as defined in the Registration Rights Agreement) with the Securities and Exchange Commission (the
“Commission”) registering the resale of the Offered Securities and the Underlying Shares, as hereinafter defined, under Rule 415 of the Securities Act. 
  
 The Company hereby agrees with the Purchaser as follows: 

 2. Representations and Warranties of the Company. The Company represents and warrants to,
and agrees with, the Purchaser that: 
  
 (a) An
offering circular relating to the Offered Securities to be offered by the Purchaser has been prepared by the Company. Such offering circular (the “Offering Circular”), together with documents incorporated by reference therein into
the Offering Circular, are hereinafter collectively referred to as the “Offering Document”. As of the date of this Agreement, and on any Closing Date (as hereinafter defined), the Offering Document does not and will not include any
untrue statements of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Offering Document based upon written information furnished to the Company by the Purchaser specifically for use therein, it being understood and agreed that the only such information is that described as such in
Section 7(b) hereof. The documents incorporated by reference in the Offering Circular (the “Exchange Act Reports”), when they were filed with the Commission, conformed in all material respects to the requirements of the Securities
Act or the United States Securities Exchange Act of 1934 (the “Exchange Act”) and the rules and regulations of the Commission thereunder, as applicable. 
  
 (b) The Company has been duly incorporated and is an existing corporation in good standing under the laws of
the State of Delaware, with power and authority (corporate and other) to own its properties and conduct its business as described in the Offering Document; and the Company is duly qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except where such failure to so qualify would not individually or in the aggregate (1) result in a material adverse
effect on the properties, business, results of operations, financial condition or prospects of the Company and its subsidiaries taken as a whole, (2) interfere with or adversely affect the issuance or marketability of the Offered Securities or (3)
in any manner draw into question the validity of this Agreement, the Offering Document or the Exchange Act Reports (any of the events set forth in clauses (1), (2) or (3), a “Material Adverse Effect”). 
  
 (c) Each subsidiary of the Company has been duly
incorporated and is an existing corporation in good standing (to the extent such a concept exists in such jurisdiction) under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and
conduct its business as described in the Offering Document; and each subsidiary of the Company is duly qualified to do business as a foreign corporation in good standing (to the extent such a concept exists in such jurisdiction) in all other
jurisdictions in which its ownership or lease of property or the conduct of its business requires such qualification, except where such failure to so qualify would not individually or in the aggregate have a Material Adverse Effect; all of the
issued and outstanding capital stock of each subsidiary of the Company has been duly authorized and validly issued and is fully paid and nonassessable; and except for pledges in favor of Credit Suisse First Boston, as collateral agent, under the
Credit Agreement, dated as of August 5, 1999, as amended, by and among ChipPAC International Company 
  

 2 

 
Limited, the Company, the lenders listed therein and Credit Suisse First Boston, the capital stock of each subsidiary owned by the Company, directly or
through subsidiaries, is owned free from liens, encumbrances and defects. 
  
 (d) All outstanding shares of capital stock of the Company have been duly authorized, validly issued, fully paid and are nonassessable and conform to the description thereof contained in the Offering Document.

  
 (e) The Indenture has been duly authorized by
the Company; the Offered Securities have been duly authorized; and when the Offered Securities are delivered and paid for pursuant to this Agreement and the Indenture on the Closing Date (as defined below), the Indenture will have been duly executed
and delivered by the Company, such Offered Securities will have been duly executed and delivered and will conform in all material respects to the description thereof contained in the Offering Document and the Indenture and such Offered Securities
will constitute valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating
to or affecting creditors’ rights and to general equity principles. 
  
 (f) When the Offered Securities are delivered and paid for pursuant to this Agreement on the Closing Date, such Offered Securities will be convertible into shares of Class A Common Stock, par value $0.01 per share
(“Underlying Shares”) of the Company in accordance with the terms of the Indenture; the Underlying Shares initially issuable upon conversion of such Offered Securities have been duly authorized and reserved for issuance upon such
conversion and, when issued upon such conversion, will be validly issued, fully paid and nonassessable; the outstanding Underlying Shares have been duly authorized and validly issued, are fully paid and nonassessable and conform in all material
respects to the description thereof contained in the Offering Document; and the stockholders of the Company have no preemptive rights with respect to the Offered Securities or the Underlying Shares. 
  
 (g) Except as disclosed in the Offering Document, there are
no contracts, agreements or understandings between the Company and any person that would give rise to a valid claim against the Company or any Purchaser for a brokerage commission, finder’s fee or other like payment in connection with the
offering of the Offered Securities. 
  
 (h) There
are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such securities in the securities registered pursuant to registration statement filed by the Company under the Securities Act, other than the Amended and Restated Registration
Agreement, dated as of August 5, 1999, as amended, among the Company, affiliates of Bain Capital, Inc. and SXI Group LLC (collectively, the “Equity Investors”) and their designee, Intel or as otherwise disclosed or set forth in the
Offering Document. 
  

 3 

 (i) Subject to the assumptions set forth in Section 2(x) below, no consent, approval,
authorization, or order of, or filing with, any governmental agency or body or any court is required for the consummation of the transactions contemplated by this Agreement and the Registration Rights Agreement in connection with the issuance and
sale of the Offered Securities by the Company, except (A) as required pursuant to the Registration Rights Agreement, (B) upon the approval of the Underlying Shares issuable upon the conversion of the Offered Securities for quotation on the Nasdaq
National Market, (C) such consents, approvals, authorizations or qualifications as may be required under state securities laws in connection with the purchase and distribution of the Offered Securities and the Underlying Shares by the Purchaser and
(D) in connection with the qualification of the Indenture under the United States Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”) as may be required under the Registration Rights Agreement. 
  
 (j) The execution, delivery and performance by the Company
of the Indenture, this Agreement and the Registration Rights Agreement, and the issuance and sale of the Offered Securities and compliance with the terms and provisions thereof will not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, (1) any statute, any rule, regulation or order of any governmental agency or body or any court, domestic or foreign, having jurisdiction over the Company or any subsidiary of the Company or any of their
properties, (2) any agreement or instrument to which the Company or any such subsidiary is a party or by which the Company or any such subsidiary is bound or to which any of the properties of the Company or any such subsidiary is subject or (3) the
charter or by-laws of the Company or any such subsidiary, except (A) in each case, that any rights to indemnity and contribution may be limited by federal and state securities laws and public policy considerations and (B) in the case of subclauses
(1) and (2), for such breaches, violations and defaults which would not individually or in the aggregate have a Material Adverse Effect; and the Company has full power and authority to authorize, issue and sell the Offered Securities as contemplated
by this Agreement. 
  
 (k) This Agreement has
been and the Registration Rights Agreement as of the First Closing Date will be duly authorized, executed and delivered by the Company. 
  
 (l) Except as disclosed in the Offering Document, the Company and its subsidiaries have good and marketable title to all real properties
and all other properties and assets owned by them that are material to the Company and its subsidiaries taken as a whole, in each case free from liens, encumbrances and defects that would materially affect the value thereof or materially interfere
with the use made or to be made thereof by them; and except as disclosed in the Offering Document, the Company and its subsidiaries hold any leased real or personal property under valid and enforceable leases with no exceptions that would materially
interfere with the use made or to be made thereof by them. 
  
 (m) The Company and its subsidiaries possess adequate certificates, authorities or permits issued by appropriate governmental agencies or bodies necessary to conduct the business now operated by them and have not
received any notice of proceedings relating 
  

 4 

 
to the revocation or modification of any such certificate, authority or permit that, if determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect. 
  
 (n) No labor strike, slowdown, stoppage or dispute with the employees of the Company or any subsidiary exists or, to the knowledge of the Company, is imminent that would reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect. None of the Company or any of its subsidiaries has violated (A) any federal, state or local law or foreign law relating to discrimination in hiring, promotion or pay of employees, (B) any applicable wage
or hour laws of, or (C) any provision of the Employee Retirement Income Security Act of 1974, as amended, or the rules and regulations thereunder, except those violations that could not reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect. 
  
 (o) The
Company and its subsidiaries own, possess or can acquire on reasonable terms, adequate trademarks, trade names and other rights to inventions, know-how, patents, copyrights, confidential information and other intellectual property (collectively,
“intellectual property rights”) necessary to conduct the business now operated by them, or presently employed by them, and have not received any notice of infringement of or conflict with asserted rights of others with respect to
any intellectual property rights that, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a Material Adverse Effect. 
  
 (p) Except as disclosed in the Offering Document, neither the Company nor any of its subsidiaries (A) is in
violation of any statute, any rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic substances (collectively, “environmental laws”), (B) owns or operates any real property contaminated with any substance that is subject to any environmental
laws, (C) is liable for any off-site disposal or contamination pursuant to any environmental laws or (D) is subject to any claim relating to any environmental laws, in each case which violation, contamination, liability or claim would individually
or in the aggregate have a Material Adverse Effect; and the Company is not aware of any pending investigation which might lead to such a claim. 
  
 (q) Except as disclosed in the Offering Document, there are no pending actions, suits or proceedings against or affecting the Company, any
of its subsidiaries or any of their respective properties that, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a Material Adverse Effect, or would materially and adversely affect the
ability of the Company to perform its obligations under the Indenture, this Agreement or the Registration Rights Agreement, or which are otherwise material in the context of the sale of the Offered Securities; and no such actions, suits or
proceedings are threatened or, to the Company’s knowledge, contemplated, that would individually or in the aggregate have a Material Adverse Effect. 
  

 5 

 (r) The financial statements included in the Offering Document present fairly the
financial position of the Company and its consolidated subsidiaries as of the dates shown and their results of operations and cash flows for the periods shown, and except as otherwise disclosed in the Offering Document, such financial statements
have been prepared in conformity with the generally accepted accounting principles in the United States applied on a consistent basis; and the assumptions used in preparing the pro forma financial statements included in the Offering Document provide
a reasonable basis for presenting the significant effects directly attributable to the transactions or events described therein, the related pro forma adjustments give appropriate effect to those assumptions, and the pro forma columns therein
reflect the proper application of those adjustments to the corresponding historical financial statement amounts. 
  
 (s) Except as disclosed in the Offering Document, since December 31, 2002, there has been no material adverse change, nor any development
or event involving a prospective material adverse change, in the condition (financial or other), business, properties or results of operations of the Company and its subsidiaries taken as a whole, and, except as disclosed in or contemplated by the
Offering Document, there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock. 
  
 (t) The Company is subject to the reporting requirements of either Section 13 or Section 15(d) of the Exchange Act and files reports with
the Commission on the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. 
  
 (u) The Company is not an open-end investment company, unit investment trust or face-amount certificate company that is or is required to
be registered under Section 8 of the United States Investment Company Act of 1940 (the “Investment Company Act”); and the Company is not and, after giving effect to the offering and sale of the Offered Securities and the application
of the proceeds thereof as will be described in the Offering Document, will not be an “investment company” as defined in the Investment Company Act. 
  

(v) None of the Company or any of its subsidiaries or, to the best knowledge of the Company and its subsidiaries, any director,
officer, agent, employee or other person associated with or acting on behalf of the Company or its subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political
activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv)
made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment. 
  
 (w) No securities of the same class (within the meaning of Rule 144A(d)(3) under the Securities Act) as the Offered Securities are listed
on any national securities exchange registered under Section 6 of the Exchange Act or quoted in a U.S. automated inter-dealer quotation system. 
  

 6 

 (x) Assuming the accuracy of the representation and warranties in Section 4 of this
Agreement, the offer and sale of the Offered Securities in the manner contemplated by this Agreement will be exempt from the registration requirements of the Securities Act by reason of Section 4(2) thereof and/or Regulation S and it is not
necessary to qualify an indenture in respect of the Offered Securities under the Trust Indenture Act in connection with the offer, sale and delivery of the Offered Securities to the Purchaser in the manner contemplated by this Agreement, except as
contemplated by the Registration Rights Agreement. 
  
 (y) Neither the Company nor any of its affiliates, nor any person (except with respect to the Purchaser, as to whom the Company makes no representations or warranties) acting on its or their behalf (i) has, within the six-month period prior
to the date hereof, offered or sold in the United States or to any U.S. person (as such terms are defined in Regulation S under the Securities Act) the Offered Securities or any security of the same class or series as the Offered Securities or (ii)
has offered or will offer or sell the Offered Securities (A) in the United States by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) under the Securities Act or (B) with respect to any securities
sold in reliance on Rule 903 of Regulation S, by means of any directed selling efforts within the meaning of Rule 902(c) of Regulation S. The Company, its affiliates and any person acting on its or their behalf have complied and will comply with the
offering Restrictions Requirement in Regulation S. The Company, its affiliates and any person acting on their behalf have not entered and will not enter into any contractual arrangement with respect to the distribution of the Offered Securities
except for this Agreement. 
  
 3. Purchase, Sale and
Delivery of Offered Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to sell to the Purchaser, and the Purchaser agrees to
purchase from the Company, at a purchase price of 97% of the principal amount thereof plus accrued interest from May 28, 2003 to the First Closing Date (as hereinafter defined), all the Firm Securities. 
  
 The Company will deliver against payment of the purchase price the Firm
Securities offered and sold by the Purchaser in reliance on Rule 144A under the Securities Act in the form of one or more permanent global Securities in definitive form (the “Firm Global Securities”) deposited with the
Trustee as custodian for The Depository Trust Company (“DTC”) and registered in the name of Cede & Co., as nominee for DTC. Interests in any permanent Global Securities will be held only in book-entry form through DTC, except in
the limited circumstances described in the Offering Document. The Global Securities shall include the legend regarding restrictions on transfer set forth under the heading “Transfer Restrictions” in the Offering Document. Payment for the
Firm Securities shall be made by the Purchaser in Federal (same day) funds by wire transfer to an account at a bank designated by the Company and acceptable to the Purchaser drawn to the order of the Company at the office of Cravath, Swaine &
Moore LLP at 10:00 A.M. (New York time), on May 28, 2003, or at such other time not later than seven full business days thereafter as Lehman Brothers Inc. and the Company determine, such time being herein referred to as the “First Closing
Date”, against delivery to the Trustee as custodian for DTC of the Firm Global Securities representing all of the Firm 
  

 7 

 
Securities. The Firm Global Securities will be made available for checking at the above office of Cravath, Swaine & Moore LLP at least 24 hours prior to
the First Closing Date. 
  
 In addition, upon written notice from
the Purchaser given to the Company from time to time not more than 30 days subsequent to the date of this Agreement, the Purchaser may purchase all or less than all of the Optional Securities at the purchase price per principal amount of Offered
Securities (including accrued interest, if any, thereon to the related Optional Closing Date) to be paid for the Firm Securities. The Company agrees to sell to the Purchaser the principal amount of Optional Securities specified in such notice and
the Purchaser agrees to purchase such Optional Securities. No Optional Securities shall be sold or delivered unless the Firm Securities previously have been, or simultaneously are, sold and delivered. The right to purchase the Optional Securities or
any portion thereof may be exercised from time to time and to the extent not previously exercised may be surrendered and terminated at any time upon notice by the Purchaser to the Company. 
  
 Each time for the delivery of and payment for the Optional Securities, being
herein referred to as the “Optional Closing Date”, which may be the First Closing Date (the First Closing Date and each Optional Closing Date, if any, being sometimes referred to as a “Closing Date”), shall be
determined by the Purchaser but shall not be later than seven full business days after written notice of election to purchase Optional Securities is given. The Company will deliver against payment of the purchase price the Optional Securities being
purchased on each Optional Closing Date in the form of one or more permanent global Securities in definitive form (each, an “Optional Global Security”) deposited with the Trustee as custodian for DTC and registered in the name of
Cede & Co., as nominee for DTC. Payment for such Optional Securities shall be made by the Purchaser in Federal (same day) funds by official check or checks or wire transfer to an account at a bank designated by the Company and acceptable to the
Purchaser drawn to the order of the Company at the office of Cravath, Swaine & Moore LLP, against delivery to the Trustee as custodian for DTC of the Optional Global Securities representing all of the Optional Securities being purchased on such
Optional Closing Date. 
  
 4. Representations by
Purchaser; Resale by Purchaser. 
  
 (a) The
Purchaser represents and warrants to the Company that it is an “accredited investor” within the meaning of Regulation D under the Securities Act. 
  
 (b) The Purchaser acknowledges that the Offered Securities have not been registered under the Securities Act and may not be offered or
sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. The Purchaser represents and agrees that it has not offered or sold, and will not offer or
sell, any Offered Securities constituting part of its allotment within the United States, except in accordance with Rule 903 or Rule 144A under the Securities Act. Accordingly, neither the Purchaser nor its affiliates, nor any persons acting on its
or their behalf, have engaged or will engage in any directed selling efforts with respect to the Securities, and the Purchaser, its affiliates and all persons acting on its behalf have complied in all material respects and will comply in all
material respects with the offering restrictions requirements of Regulation S and 
  

 8 

 
Rule 144A. Terms used in this subsection (b) have the meanings given to them by Regulation S. 
  
 (c) The Purchaser agrees that it and each of its affiliates has not entered and will not enter into any
contractual arrangement with respect to the distribution of the Offered Securities except with the prior written consent of the Company. 
  
 (d) The Purchaser agrees that it and each of its affiliates will not offer or sell the Offered Securities by means of any form of general
solicitation or general advertising, within the meaning of Rule 502(c) under the Securities Act, including, but not limited to (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or
broadcast over television or radio, or (ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising. The Purchaser agrees, with respect to resales made in reliance on Rule 144A of any of the
Offered Securities, to deliver either with the confirmation of such resale or otherwise prior to settlement of such resale a notice to the effect that the resale of such Offered Securities has been made in reliance upon the exemption from the
registration requirements of the Securities Act provided by Rule 144A. 
  
 (e) The Purchaser represents and agrees that (i) it has not offered or sold and prior to the date six months after the date of issue of the Offered Securities will not offer or sell any Offered Securities to persons
in the United Kingdom except to persons whose ordinary activities involve them acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances which have not
resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulation 1995; (ii) it has complied and will comply with all applicable provisions of the Financial Services Act of
1986 with respect to anything done by it in relation to the Offered Securities in, from or otherwise involving the United Kingdom; and (iii) it has only issued or passed on and will only issue or pass on in the United Kingdom any document received
by it in connection with the issue of the Offered Securities to a person who is of a kind described in Article 11(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued be issued or passed. 
  
 5.
Certain Agreements of the Company. The Company agrees with the Purchaser that: 
  
 (a) The Company will advise the Purchaser promptly of any proposal to amend or supplement the Offering Document and will not effect such
amendment or supplementation without the Purchaser’s consent, which consent shall not be unreasonably withheld. If, at any time prior to the completion of the resale of the Offered Securities by the Purchaser, any event occurs as a result of
which the Offering Document as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any such time to amend or supplement the Offering Document to comply with any applicable law, the Company promptly will notify the Purchaser of such event 
  

 9 

 
and promptly will prepare, at its own expense, an amendment or supplement which will correct such statement or omission or effect such compliance. Upon
receipt of such notice in written form, the Purchaser agrees to suspend use of the Offering Document until the Company has amended or supplemented the Offering Document to correct such misstatement or omission or to effect compliance with this
paragraph (a). Neither the Purchaser’s consent to, nor the Purchaser’s delivery to offerees or investors of, any such amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 6. The Company’s and
the Purchaser’s obligations under this paragraph (a) shall terminate on the earliest to occur of (i) the effective date of a shelf registration statement with respect to the Offered Securities filed pursuant to the Registration Rights Agreement
and (ii) the date upon which the Purchaser or any of its affiliates no longer continues to hold Offered Securities acquired as part of their initial distribution. 
  
 (b) The Company will furnish to the Purchaser copies of the Offering Document and all amendments and
supplements to such document, in each case as soon as available and in such quantities as the Purchaser reasonably requests, and the Company will furnish to the Purchaser on the First Closing Date three copies of the Offering Document signed by a
duly authorized officer of the Company. At any time when the Company is not subject to Section 13 or 15(d) of the Exchange Act and, upon request of holders and prospective purchasers of the Offered Securities, the Company will furnish to such
holders and purchasers, copies of the information required to be delivered to holders and prospective purchasers of the Offered Securities pursuant to Rule 144A(d)(4) under the Securities Act (or any successor provision thereto) in order to permit
compliance with Rule 144A in connection with resales by such holders of the Offered Securities. The Company will pay the expenses of printing and distributing to the Purchaser all such documents. 
  
 (c) The Company will cooperate with the Purchaser and its
counsel in connection with the registration and qualification of the Offered Securities for sale and the determination of their eligibility for investment under the laws of such states in the United States as the Purchaser designates and do all
things necessary to continue such qualifications in effect so long as required for the resale of the Offered Securities by the Purchaser provided that the Company will not be required to qualify as a foreign corporation or to file a general consent
to service of process in any such state. 
  
 (d)
During the period of two years after the later of the First Closing Date and the last Optional Closing Date, the Company will, upon request, furnish to the Purchaser and any holder of Offered Securities a copy of the restrictions on transfer
applicable to the Offered Securities. 
  
 (e)
During the period of two years after the later of the Closing Date and the last Optional Closing Date, the Company will not be or become, an open-end investment company, unit investment trust or face-amount certificate company that is or is required
to be registered under Section 8 of the Investment Company Act. 
  
 (f) The Company will pay all expenses incidental to the performance of its obligations under this Agreement, the Indenture and the Registration Rights Agreement 
  

 10 

 
including (i) the fees and expenses of the Trustee, and its professional advisers; (ii) all expenses in connection with the execution, issue, authentication,
packaging and initial delivery of the Offered Securities, the preparation and printing of this Agreement, the Registration Rights Agreement, the Offered Securities, the Indenture, the Offering Document and amendments and supplements thereto, and any
other document relating to the issuance, offer, sale and delivery of the Offered Securities; (iii) the cost of qualifying the Offered Securities for trading in The PortalSM Market (“PORTAL”) of The Nasdaq Stock Market, Inc. and any expenses incidental thereto, (iv) the cost of any advertising specifically
approved by the Company in connection with the issue of the Offered Securities, (v) for any expenses (including fees and disbursements of counsel) incurred in connection with qualification of the Offered Securities for sale under the laws of such
jurisdictions as Lehman Brothers Inc. designates and the printing of memoranda relating thereto if applicable, (vi) for any fees charged by investment rating agencies for the rating of the Offered Securities, and (vii) for expenses incurred in
distributing the Offering Document (including any amendments and supplements thereto) to the Purchaser. To the extent specifically approved by the Company, the Company will also pay or reimburse the Purchaser (to the extent incurred by it) for all
reasonable travel expenses of the Purchaser and any other reasonable expenses of the Purchaser in connection with attendance of meetings with prospective purchasers of the Offered Securities from the Purchaser. 
  
 (g) In connection with the offering, until the Purchaser
shall have notified the Company of the completion of the resale of the Offered Securities, neither the Company nor any of its affiliates has or will, either alone or with one or more other persons, bid for or purchase for any account in which it or
any of its affiliates has a beneficial interest any Offered Securities or attempt to induce any person to purchase any Offered Securities; and neither it nor any of its affiliates will make bids or purchases for the purpose of creating actual, or
apparent, active trading in, or of raising the price of, the Offered Securities. 
  
 (h) For a period of 90 days after the date of the initial offering of the Offered Securities by the Purchaser, the Company will not offer,
sell, contract to sell, pledge, or otherwise dispose of, directly or indirectly, or file with the Commission a registration statement under the Act relating to, any United States dollar-denominated debt securities issued or guaranteed by the Company
and having a maturity of more than three years from the date of issue and shares of Common Stock of the Company or securities convertible into or exchangeable or exercisable for shares of Common Stock of the Company or warrants or other rights to
purchase shares of Common Stock of the Company, or publicly disclose the intentions to make any such offer, sale, pledge or disposition, without the prior written consent of Lehman Brothers Inc., except the offer, sale, contract to sell or other
disposition of (1) the Offered Securities, (2) securities issued or delivered upon conversion, exchange or exercise of any other securities of the Company outstanding on the date of the Offering Document or (3) capital stock and options of the
Company issued pursuant to benefit or incentive plans maintained for its officers, directors, employees or persons providing services to the Company. The Company will not at any time offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, any securities under circumstances where such offer, sale, pledge, 
  

 11 

 
contract or disposition would cause the exemption afforded by Section 4(2) of the Securities Act or Regulation S thereunder to cease to be applicable to the
offer and sale of the Offered Securities. 
  
 (i)
The Company will arrange for the listing of the Underlying Shares on The Nasdaq Stock Market, Inc.’s National Market. 
  
 6. Conditions of the Obligations of the Purchaser. The obligations of the Purchaser to purchase and pay for the Offered Firm Securities on
the First Closing Date and for the Optional Securities on each Optional Closing Date will be subject to the accuracy of the representations and warranties on the part of the Company herein, to the accuracy of the statements of officers of the
Company made pursuant to the provisions hereof, to the performance by the Company of its obligations hereunder and to the following additional conditions precedent: 
  
 (a) The Purchaser shall have received a letter, dated the date of this Agreement, of PricewaterhouseCoopers
LLP confirming that they are independent public accountants within the meaning of the Securities Act and the applicable published rules and regulations thereunder (“Rules and Regulations”) and to the effect that: 
  
 (i) in their opinion the financial statements examined by
them and included in the Offering Document comply as to form in all material respects with the applicable accounting requirements of the Securities Act and the related published Rules and Regulations; 
  
 (ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of interim financial information as described in Statement of Auditing Standards No. 100, Interim Financial Information, on the unaudited financial statements included in the Exchange
Act Reports; 
  
 (iii) on the basis of the review
referred to in clause (ii) above, a reading of the latest available interim financial statements of the Company, inquiries of officials of the Company who have responsibility for financial and accounting matters and other specified procedures,
nothing came to their attention that caused them to believe that: 
  
 (A) the unaudited financial statements included in the Exchange Act Reports do not comply as to form in all material respects with the applicable accounting requirements of the Securities Act and the related published
Rules and Regulations or any material modifications should be made to such unaudited financial statements for them to be in conformity with generally accepted accounting principles; 
  
 (B) at the date of the latest available balance sheet read by such accountants, or at a subsequent
specified date not more than three business days prior to the date of this Agreement, there was any change in the capital stock or any increase in short-term or long-term indebtedness of the Company and its consolidated subsidiaries or, at the date
of the latest 
  

 12 

 
available balance sheet read by such accountants, there was any decrease in consolidated net current assets or net assets, as compared with amounts shown on
the latest balance sheet included in the Exchange Act Reports; or 
  
 (C) for the period from the closing date of the latest income statement included in the Exchange Act Reports to the closing date of the latest available income statement read by such accountants there were any
decreases, as compared with the corresponding period of the previous year, in consolidated revenue, operating income or in the total or per share amounts of consolidated net income, 
  
 except in all cases set forth above in clauses (B) and (C) for changes, increases or decreases which are described in such
letter; and 
  
 (iv) they have compared specified
dollar amounts (or percentages derived from such dollar amounts) and other financial information contained in the Exchange Act Reports and the Offering Document (in each case to the extent that such dollar amounts, percentages and other financial
information are derived from the general accounting records of the Company and its subsidiaries subject to the internal controls of the Company’s accounting system or are derived directly from such records by analysis or computation) with the
results obtained from inquiries, a reading of such general accounting records and other procedures specified in such letter and have found such dollar amounts, percentages and other financial information to be in agreement with such results, except
as otherwise specified in such letter. 
  
 (b)
Subsequent to the execution and delivery of this Agreement, there shall not have occurred (i) any change, or any development or event involving a prospective change, in the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as one enterprise which, in the reasonable judgment of the Purchaser is material and adverse and makes it impractical or inadvisable to proceed with completion of the offering or the sale of and
payment for the Offered Securities; (ii) any downgrading in the rating of any debt securities of the Company by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the Securities Act),
or any public announcement that any such organization has under surveillance or review its rating of any debt securities of the Company (other than an announcement with positive implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any change in U.S. or international financial, political or economic conditions or currency exchange rates or exchange controls as would, in the judgment of the Purchaser, be likely to prejudice materially the
success of the proposed issue, sale or distribution of the Offered Securities, whether in the primary market or in respect of dealings in the secondary market; (iv) any material suspension or material limitation of trading in securities generally on
the New York Stock Exchange or the Nasdaq Stock Market’s National Market, or any setting of minimum prices for trading on such exchange, or any suspension of trading of any securities of the Company on any exchange or in the over-the-counter
market; (v) any 
  

 13 

 
banking moratorium declared by U.S. Federal or New York authorities; (vi) any major disruption of settlements of securities or clearance services in the
United States or (vii) any attack on, outbreak or escalation of hostilities or act of terrorism involving the United States, any declaration of war by Congress or any other substantial national or international calamity or emergency if, in the
judgment of the Purchaser, the effect of any such attack, outbreak, escalation, act, declaration, calamity or emergency makes it impractical or inadvisable to proceed with completion of the offering or sale of and payment for the Offered Securities.

  
 (c) The Purchaser shall have received an
opinion, dated such Closing Date, of Kirkland & Ellis, counsel for the Company, to the effect that: 
  
 (i) The Company is duly incorporated and is existing as a corporation in good standing under the Delaware General Corporation Laws and has
all requisite corporate power and authority to carry on its business as it is currently being conducted and as described in the Offering Circular. 
  
 (ii) The Agreement has been duly authorized and executed by the Company. 
  
 (iii) The Offered Securities delivered on such Closing Date are convertible into Common Stock of the Company
in accordance with the terms of the Indenture; the shares of such Common Stock initially issuable upon conversion of the Offered Securities delivered on such Closing Date have been duly authorized and reserved for issuance upon such conversion and,
when issued upon such conversion, will be validly issued, fully paid and nonassessable; neither the issuance of the Offered Securities nor the issuance of Common Stock upon conversion thereof is subject to any preemptive rights under the terms of
the statute under which the Company is incorporated, under the Company’s Certificate of Incorporation or under any contractual provision of which we have knowledge. 
  
 (iv) Each of the Registration Rights Agreement and the Indenture has been duly authorized, executed and
delivered by the Company, and, assuming the due authorization, execution and delivery of such agreements by the other parties thereto, constitutes a valid and legally binding obligation of the Company, enforceable against the Company in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws affecting creditors’ rights and remedies generally and to general principles of equity (regardless of whether
enforcement is sought in a proceeding at law or in equity). 
  
 (v) The execution and delivery by the Company of, and performance by the Company of its obligations under, the Registration Rights Agreement, the Indenture and the Agreement and the issuance and sale of the Offered
Securities will not (i) violate the certificate of incorporation or bylaws of the Company, (ii) to our knowledge, conflict with or constitute a breach of, or a default under, any agreement filed as exhibits to the Company’s Annual Report on
Form 10-K for 
  

 14 

 
the year ended December 31, 2002 (provided that we express no opinion as to compliance with any financial test or cross-default provision in any such
agreement) or (iii) to our knowledge, breach or otherwise violate any provision in any court or administrative order, writ, judgment or decree that names the Company and is specifically directed to any of its property (except that for purposes of
this paragraph, we express no opinion with respect to federal or state securities laws or other anti-fraud laws and no opinion as to whether performance of the indemnification or contribution provisions in the Agreement will be enforceable).

  
 (vi) No consent, approval, authorization or
order of, or filing with, any governmental agency or body or any court of the United States or the State of California is required for the issuance and sale by the Company of the Offered Securities to the Purchaser, the issuance and delivery of the
shares of Common Stock issuable upon conversion of the Offered Securities (assuming such conversion on the date hereof) or the consummation by the Company of the other transactions contemplated by the Agreement and the Indenture, except such as may
be required under the Securities Act, the Trust Indenture Act, foreign securities laws and U.S. “Blue Sky” laws. 
  
 (vii) When the Offered Securities are issued and delivered pursuant to this Agreement, no Offered Securities will be of the same class
(within the meaning of Rule 144A under the Securities Act) as securities of the Company that are listed on a national securities exchange registered under Section 6 of the Exchange Act or that are quoted in a United States automated inter-dealer
quotation system. 
  
 (viii) The Company is not
an “investment company” within the meaning of the Investment Company Act and after giving effect to the sale of the Offered Securities in the Offering Document, will not be, an “investment company” within the meaning of the
Investment Company Act. 
  
 (ix) To our
knowledge, no stop order preventing the use of the Offering Document, or any order asserting that the issuance of the Offered Securities are subject to the registration requirements of the Securities Act, has been issued. 
  
 (x) It is not necessary in connection with (i) the offer,
sale and delivery of the Offered Securities to the Purchaser pursuant to this Agreement or (ii) the resales of the Offered Securities by the Purchaser in the manner contemplated in the Offering Circular to register the Offered Securities under the
Securities Act or to qualify an indenture in respect thereof under the Trust Indenture Act. 
  
 (xi) Assuming that the Offered Securities have been duly authorized by the Company, when executed and issued by the Company and
authenticated by the Trustee in accordance with the terms of the Indenture, and delivered and paid for by the Purchaser in accordance with the terms of this Agreement, the Offered Securities will constitute valid and legally binding obligations of
the Company enforceable against the Company in accordance with their terms, subject to 
  

 15 

 
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws affecting creditors’ rights and remedies generally
and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity). 
  
 (xii) The statements in the Offering Document under the caption “Description of the Notes” insofar as they describe the
provisions of the documents and instruments therein described, constitute fair summaries thereof accurate in all material respects and the statements in the Offering Document under the caption “Certain United States Federal Income Tax
Considerations” insofar as they purport to describe certain United States federal income tax consequences of the purchase, ownership and disposition of the Offered Securities under current law, provide a fair summary of such consequences in all
material respects. 
  
 (xiii) Such counsel shall
also state that the purpose of such counsel’s professional engagement was not to establish factual matters, and preparation of the Offering Circular involved many determinations of a wholly or partially nonlegal character. Such counsel need
make no representation that it has independently verified the accuracy, completeness or fairness of the Offering Circular or that actions taken in connection with the preparation of the Offering Circular (including the actions described below) were
sufficient to cause the Offering Circular to be accurate, complete or fair. Such counsel need not pass upon and need not assume any responsibility for the accuracy, completeness or fairness of the Offering Circular except to the extent otherwise
explicitly indicated in numbered paragraph (xii) above. Such counsel shall however confirm that it has participated in discussions with representatives of the Company, representatives of the Purchaser, counsel for the Purchaser and representatives
of the independent accountants for the Company during which disclosures in the Offering Circular and related matters were discussed. Such counsel shall also state that it has reviewed certain corporate records furnished to it by the Company. Based
upon such counsel’s participation in the conferences and its document review identified above, such counsel’s understanding of applicable law and the experience such counsel has gained in such counsel’s practice thereunder and relying
as to materiality to a large extent upon the opinions and statements of officers of the Company, such counsel can, however, advise the Purchaser that nothing has come to such counsel’s attention that has caused such counsel to conclude that the
Offering Circular at the date it bears or on the date of this letter contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. 
  
 (d) The Company shall have furnished to the Purchasers the opinion of Patricia H. McCall, Senior Vice President, General Counsel and Secretary of the Company, dated the Closing Date, to the effect that: 
  

 16 

 (i) The outstanding shares of such Common Stock have been duly authorized and validly
issued, are fully paid and nonassessable and conform to the description thereof contained in the Offering Document. 
  
 (ii) The Company has the corporate power and corporate authority to own and lease its properties and to conduct its business as described
in the Offering Circular in all material respects. 
  
 (iii) Except as disclosed in the Offering Documents, to such counsel’s knowledge, the Company has not received any notice (written or oral) of infringement of or interference with the asserted rights of any other person with respect to
any intellectual property rights that would individually or in the aggregate have a Material Adverse Effect on the Company. 
  
 (iv) Excluding the matters contained under the caption “Certain United States Federal Income Tax Considerations”, to such
counsel’s knowledge, the descriptions in the Offering Document and the Exchange Act Reports incorporated therein of statutes (excluding Federal securities laws), legal and governmental proceedings, and contracts relevant to the Company and its
business in all material respects are accurate statements or summaries of the matters set forth therein. 
  
 (v) The execution and delivery by the Company of, and performance by the Company of its obligations under, the Registration Rights
Agreement, the Indenture and the Agreement and the issuance and sale of the Offered Securities will not (i) violate the certificate of incorporation or bylaws of the Company, (ii) to such counsel’s knowledge, conflict with or constitute a
breach of, or a default under, any agreement filed as exhibits to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002 (provided that such counsel expresses no opinion as to compliance with any financial test or
cross-default provision in any such agreement) or (iii) to such counsel’s knowledge, breach or otherwise violate any provision in any court or administrative order, writ, judgment or decree that names the Company and is specifically directed to
any of its property (except that for purposes of this paragraph, such counsel expresses no opinion with respect to federal or state securities laws or other anti-fraud laws and no opinion as to whether performance of the indemnification or
contribution provisions in the Agreement will be enforceable). 
  
 (vi) Except as expressly disclosed in the Offering Document or otherwise to the Purchaser, to the knowledge of such counsel, except for rights which have been waived in connection with the sale of the Offered
Securities and the filing of the Registration Statement, no holders of securities of the Company have rights to the registration of such securities under the Certificate of Incorporation of the Company or pursuant to the terms of any agreement to
which the Company is a party. 
  

 17 

 (vii) To such counsel’s knowledge, there is no action, suit, proceeding or
investigation before or by any court of governmental agency or body, domestic or foreign, pending or threatened against the Company that (i) has caused such counsel to conclude that such action, suit, proceeding or investigation is required to be
described in the Offering document but is not so described or (ii) would be reasonably likely to adversely affect the consummation of any of the transactions contemplated by the Purchase Agreement or the Indenture. 
  
 In addition to the matters set forth above, such opinion shall also include a statement to
the effect that nothing has come to the attention of such counsel which leads him to believe that the Offering Document, or any amendment or supplement thereto, or any Exchange Act Report incorporated by reference therein, as of its date or as of
such Closing Date, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading (except that counsel need express no view as to
financial statements, schedules and other financial information included or incorporated by reference therein). With respect to such statements, such counsel may state that his belief is based upon the procedures set forth therein, but is without
independent check and verification. 
  
 (e) The
Purchaser shall have received from Cravath, Swaine & Moore LLP, counsel for the Purchaser, such opinion and letter, dated such Closing Date, with respect to the incorporation of the Company, the validity of the Offered Securities, the Offering
Document, the exemption from registration for the offer and sale of the Offered Securities by the Company to the Purchaser and the resales by the Purchaser as contemplated hereby and other related matters the Purchaser may reasonably require, and
the Company shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters. 
  
 (f) The Purchaser shall have received a letter, dated such Closing Date, of PricewaterhouseCoopers LLP which meets the requirements of
subsection (a) of this Section, except that the specified date referred to in such subsection will be a date not more than three days prior to such Closing Date for the purposes of this subsection. 
  
 (g) The Purchaser shall have received a certificate, dated
such Closing Date, of the President or any Vice President and a principal financial or accounting officer of the Company in which such officers, to the best of their knowledge after reasonable investigation, shall state that the representations and
warranties of the Company in this Agreement are true and correct, that the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to such Closing Date; and that,
subsequent to the date of the most recent financial statements in the Exchange Act Reports there has been no material adverse change, nor any development or event involving a prospective material adverse change, in the condition (financial or
other), business, properties or results of operations of the Company except as set forth in or contemplated by the Exchange Act Reports or as described in such certificate. 
  

 18 

 (h) On or prior to the date of this Agreement, the Purchaser shall have received lockup
letters in substantially the form attached hereto as Exhibit 1, from each of the executive officers and directors of the Company and stockholders listed on Schedule A hereto. 
  
 The Company will furnish the Purchaser with such conformed copies of such opinions, certificates, letters and documents as the Purchaser
reasonably request. The Purchaser may in their discretion waive compliance with any conditions to their obligations hereunder, whether in respect of an Optional Closing Date or otherwise. 
  
 7. Indemnification and Contribution. (a) The Company will indemnify and hold harmless the Purchaser, its
partners, directors and officers and each person, if any, who controls the Purchaser within the meaning of Section 15 of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which such Purchaser may become
subject, under the Securities Act or the Exchange Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Offering Document, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they were made, not misleading, including any losses, claims, damages or liabilities arising out of or based upon the Company’s failure to perform its obligations under Section
5(a) of this Agreement, and will reimburse the Purchaser for any legal or other expenses reasonably incurred by the Purchaser in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with written information furnished to the Company by the Purchaser specifically for use therein, it being understood and agreed that the only such information consists of the
information described as such in subsection (b) below. 
  
 (b) The
Purchaser will indemnify and hold harmless the Company, the Company’s directors and officers and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, against any losses, claims, damages or
liabilities to which the Company may become subject, under the Securities Act or the Exchange Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the Offering Document, or any amendment or supplement thereto, or arise out of or are based upon the omission or the alleged omission to state therein a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information furnished to the Company by the Purchaser specifically for use therein, and will reimburse any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred, it being understood and agreed that the only such information furnished by the Purchaser consists of the following information in the
Offering Document 

  

 19 

 
furnished on behalf of the Purchaser: the first sentence in paragraph eleven and paragraphs twelve, thirteen and fifteen in their entirety under the caption
“Plan of Distribution”; provided, however, that the Purchaser shall not be liable for any losses, claims, damages or liabilities arising out of or based upon the Company’s failure to perform its obligations under Section 5(a) of this
Agreement. 
  
 (c) Promptly after receipt by an indemnified party
under this Section of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party otherwise than under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof, the indemnifying party will not be liable to such indemnified party under this Section for any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which
any indemnified party is or could reasonably be expected to have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement includes (i) an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action and (ii) does not include a statement as to or an admission of fault or failure to act by or on behalf of any indemnified party. No indemnified party shall effect any settlement of
any pending or threatened action without the prior written consent of the indemnifying party, which such consent shall not be unreasonably withheld or delayed. 
  

(d) If the indemnification provided for in this Section is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one hand and the Purchaser on the other from the offering of the Offered Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Purchaser on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Purchaser on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total discounts and commissions received by the Purchaser from the Company under this Agreement. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to 

  

 20 

 
state a material fact relates to information supplied by the Company or the Purchaser and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d),
the Purchaser shall not be required to contribute any amount in excess of the amount by which the total price at which the Offered Securities purchased by it were resold exceeds the amount of any damages which the Purchaser has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. 
  
 (e) The obligations of the Company under this Section shall be in addition to any liability which the Company or may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls the Purchaser
within the meaning of the Securities Act or the Exchange Act; and the obligations of the Purchaser under this Section shall be in addition to any liability which the Purchaser may otherwise have and shall extend, upon the same terms and conditions,
to each person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act. 
  
 8. Survival of Certain Representations and Obligations. The respective indemnities, agreements, representations, warranties and other
statements of the Company or their respective officers and of the Purchaser set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on
behalf of the Purchaser, the Company, or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Offered Securities. If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the Offered Securities by the Purchaser is not consummated, the Company shall remain responsible for the expenses to be paid or reimbursed by it pursuant to Section 5 and the respective obligations of
the Company, and the Purchaser pursuant to Section 7 shall remain in effect and if any Offered Securities have been purchased hereunder the representations and warranties of Section 2 and all representations under Section 5 shall also remain in
effect. If the purchase of the Offered Securities by the Purchaser is not consummated for any reason other than solely because of the termination of this Agreement pursuant to Section 8 or the occurrence of any event specified in clause (iii), (iv),
(v), (vi) or (vii) of Section 6(b), the Company will reimburse the Purchaser for all out-of-pocket expenses (including fees and disbursements of counsel) reasonably incurred by them in connection with the offering of the Offered Securities.

  
 9. Notices. All communications hereunder will be
in writing and, if sent to the Purchaser will be mailed, delivered or faxed and confirmed to the Purchaser at 745 Seventh Avenue, New York, New York 10019, Attention: Syndicate Registration, or, if sent to the Company, will be mailed, delivered or
faxed and confirmed to it at ChipPAC, Inc., 47400 Kato Road, Fremont, California 94538, Attention: Robert Krakauer. 
  

 21 

 10. Successors. This Agreement will inure to the benefit of and be binding upon the parties
hereto and their respective successors and the controlling persons referred to in Section 7, and no other person will have any right or obligation hereunder, except that holders of Offered Securities shall be entitled to enforce the agreements for
their benefit contained in the second and third sentences of Section 5(b) hereof against the Company as if such holders were parties hereto. 
  
 11. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement. 
  
 12. Applicable Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without regard to principles of conflicts of laws. 
  
 The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. 
  

 22 

 If the foregoing is in accordance with the Purchaser’s understanding of our agreement, kindly sign
and return to the Company one of the counterparts hereof, whereupon it will become a binding agreement between the Company and the Purchaser in accordance with its terms. 
  

	 Very truly yours,

	 	 	 
	 ChipPAC, Inc.

		
	by	 	 /s/ Robert
Krakauer            

	 	 	 Name: Robert Krakauer

	 	 	 Title: Senior Vice President and Chief
Financial Officer

  

 23 

 The foregoing Purchase Agreement is hereby confirmed and accepted as of the date first above written.

  

	 Lehman Brothers Inc.

		
	 by
	 	       /s/ Kyle Ryland

	 	 	 Name: Kyle Ryland

	 
	 	 Title: Managing Director

  

 24 

 SCHEDULE A 
  

Dennis P. McKenna 
  
 Robert Krakauer 
  
 Edward Conard 
  
 Bain Capital Fund VI, L.P. 
  
 BCIP Associates II 
  
 BCIP Associates II-B 
  
 BCIP Associates II-C 
  
 BCIP Trust Associates II 
  
 BCIP Trust Associates II-B 
  
 PEP Investments PTY Ltd. 
  
 Sankaty High Yield Asset Partners, L.P. 
  
 Michael A. Delaney 
  
 Marshall Haines 
  
 Chong Sup Park 
  
 BG Partners LLP 
  
 Citicorp Venture Capital LTD. 
  
 CCT Partners VI, LP 
  
 Paul C. Schorr, IV 
  
 Richard Freeman 
  
 Patricia McCall 
  
 Jeffrey Braden 
  
 Robert W. Conn 
  
 R. Douglas Norby 
  

 25 

 EXHIBIT I 
  
 FORM OF LOCK-UP AGREEMENT 
  
                 , 2003 
  
 ChipPAC, Inc. 
 47400 Kato Road 
 Fremont, CA 94538 
  
 Dear Ladies and Gentlemen: 
  
 As an inducement to one or more initial purchasers to execute a purchase
agreement (the “Purchase Agreement”), pursuant to which an offering of notes (the “Notes”) that will be convertible into Common Stock (the “Securities”) of ChipPAC, Inc. (the
“Company”) will be made, the undersigned hereby agrees that from the date hereof and until 90 days after the public offering date set forth on the final prospectus used to sell the Notes (the “Public Offering Date”)
pursuant to the Purchase Agreement, to which you are or expect to become a party, the undersigned will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any shares of Securities or securities convertible into
or exchangeable or exercisable for any shares of Securities, enter into a transaction which would have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences of
ownership of the Securities, whether any such aforementioned transaction is to be settled by delivery of the Securities or such other securities, in cash or otherwise, or publicly disclose the intention to make any such offer, sale, pledge or
disposition, or to enter into any such transaction, swap, hedge or other arrangement, without, in each case, the prior written consent of the initial purchaser(s). 
  
 Any Securities received upon exercise of options granted to the undersigned will also be subject to this Agreement. Any
Securities acquired by the undersigned in the open market after the Public Offering Date will not be subject to this Agreement. A transfer of Securities to a family member or trust may be made, provided the transferee agrees to be bound in writing
by the terms of this Agreement. In addition, if the undersigned is a partnership or limited liability company, the partnership or limited liability company, as the case may be, may transfer any Securities to a partner or member, as the case may be,
of such partnership or limited liability company, as the case may be, or a retired partner or member, as the case may be, of such partnership or limited liability company, as the case may be, who retires after the date hereof, or to the estate of
any such partner or member, as the case may be, or retired partner or member, as the case may be, and any partner or member, as the case may be, who is an individual may 

  

 26 

 
transfer Securities as a bona fide gift or gifts as provided in the immediately preceding paragraph, provided that in each case the transferee agrees to be
bound in writing by the terms of this Agreement. 
  
 In
furtherance of the foregoing, the Company and its transfer agent and registrar are hereby authorized to decline to make any transfer of shares of Securities if such transfer would constitute a violation or breach of this Agreement. 
  
 The initial purchaser(s) shall be third party beneficiaries of this
agreement, and no amendment or waiver under this agreement shall be made without the prior written consent of the initial purchaser(s). 
  
 This Agreement shall be binding on the undersigned and the successors, heirs, personal representatives and assigns of the undersigned. This Agreement
shall lapse and become null and void (a) if the Public Offering Date shall not have occurred on or before August 1, 2003 or (b) at such earlier time as the registration statement in respect of the public offering is withdrawn. 
  

	 Very truly yours,
  
 Name of Stockholder

		
	 By:
	 	  

		
	 Name:
	 	  

		
	 Title:
	 	  

  

 27

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