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Exhibit 4.03  

 
 

REGISTRATION RIGHTS AGREEMENT    
    

by and among  

 ADAPTEC, INC.  

 and  

 THE INITIAL PURCHASERS NAMED HEREIN  

 Dated December 22, 2003  

 
 

REGISTRATION RIGHTS AGREEMENT    
    

        This Registration Rights Agreement (the "Agreement") is made and entered into this 22nd day of December,
2003, between Adaptec, Inc., a Delaware corporation (the "Company"), and Merrill Lynch, Pierce, Fenner & Smith Incorporated and Banc of
America Securities LLC (each, an "Initial Purchaser" and collectively, the "Initial Purchasers"). 

        This
Agreement is made pursuant to that certain Purchase Agreement, dated December 16, 2003, between the Company and the Initial Purchasers (the "Purchase
Agreement"), which provides for the sale by the Company to the Initial Purchasers of $225,000,000 aggregate principal amount of the Company's 3/4% Convertible
Senior Subordinated Notes due 2023 (the "Notes"). In order to induce the Initial Purchasers to enter into the Purchase Agreement and in satisfaction of
a condition to the Initial Purchasers' obligations thereunder, the Company has agreed to provide the registration rights provided for in this Agreement, pursuant to Section 5 of the Purchase
Agreement. In consideration of the foregoing, the parties hereto agree as follows: 

        1.    Definitions.    

        As
used in this Agreement, the following capitalized defined terms shall have the following meanings: 

        "1933 Act" shall mean the Securities Act of 1933, as amended from time to time, and the rules and regulations of the SEC promulgated
thereunder. 

        "1934 Act" shall mean the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations of the SEC
promulgated thereunder. 

        "Closing Date" shall mean the Closing Time as defined in the Purchase Agreement. 

        "Common Stock" shall mean common stock of the Company and any other shares of common stock as may constitute "Common Stock" for purposes
of the Indenture, including the Underlying Common Stock (as defined in the Indenture). 

        "Company" shall have the meaning set forth in the preamble to this Agreement and also includes the Company's successors. 

        "Depositary" shall mean The Depository Trust Company, or any other depositary appointed by the Company; provided, however, that any such
depositary must have an address in The Borough of Manhattan, The City of New York. 

        "Effectiveness Period" shall have the meaning set forth in Section 2.1(a) hereof. 

        "Effectiveness Target Date" shall mean the one hundred eightieth (180th) day after the Closing Date. 

        "Event Date" shall have the meaning set forth in Section 2.4 hereof. 

        "Filing Date" shall mean the ninetieth (90th) day after the Closing Date. 

        "Holder" shall mean the Initial Purchasers, for so long as they own any Registrable Securities, and each of their successors, assigns and
direct and indirect transferees who become registered owners of Registrable Securities under the Indenture. 

        "Indenture" shall mean the Indenture relating to the Securities, dated as of December 22, 2003, between the Company and Wells Fargo
Bank, N.A., as trustee, as the same may be amended, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof. 

        "Initial Purchasers" shall have the meaning set forth in the preamble to this Agreement. 

        "Liquidated Damages" shall have the meaning set forth in Section 2.4 hereof. 

        "Majority Holders" shall mean the Holders of a majority of the aggregate principal amount of Registrable Securities outstanding; provided,
that whenever the consent or approval of Holders of a 

 

specified
percentage of Registrable Securities is required hereunder, Registrable Securities held by the Company or any of its affiliates (as such term is defined in Rule 405 under the 1933
Act) shall be disregarded in determining whether such consent or approval was given by the Holders of such required percentage. 

        "NASD" shall mean the National Association of Securities Dealers, Inc. 

        "Notes" shall have the meaning set forth in the preamble to this Agreement. 

        "Offering Memorandum" means that certain final Offering Memorandum of the Company, dated December 16, 2003, relating to the sale of
the Securities. 

        "Person" shall mean an individual, partnership, corporation, limited liability company, joint venture, trust or unincorporated
organization, or a government or agency or political subdivision thereof. 

        "Prospectus" shall mean the prospectus included in any Registration Statement, including any preliminary prospectus, and any such
prospectus as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement, and
all other amendments and supplements to any such prospectus, including post-effective amendments, and in each case including all material incorporated or deemed to be incorporated by
reference therein. 

        "Purchase Agreement" shall have the meaning set forth in the preamble to this Agreement. 

        "Questionnaire" shall have the meaning set forth in Section 2.1(d) hereof. 

        "Registrable Securities" shall mean the Notes and the shares of Common Stock into which the Notes are convertible, upon original issuance
thereof, and at all times subsequent thereto; provided, however, that any Securities shall cease to be Registrable Securities when (i) a Registration Statement with respect to such Securities
shall have been declared effective under the 1933 Act and such Securities shall have been disposed of pursuant to such Registration Statement, (ii) such Securities shall have been sold to the
public pursuant to Rule 144 (or any similar provision then in force, but not Rule 144A)
under the 1933 Act, (iii) expiration of the holding period that would be applicable to such Securities under Rule 144(k) under the 1933 Act were they not held by an affiliate of the
Company or (iv) such Securities shall have ceased to be outstanding. 

        "Registration Default" shall have the meaning set forth in Section 2.4 hereof. 

        "Registration Expenses" shall mean any and all expenses incident to performance of or compliance by the Company with this Agreement,
including without limitation: (i) all SEC, stock exchange or NASD registration and filing fees, including, if applicable, the fees and expenses of any "qualified independent underwriters" (and
its counsel) that is required to be retained by any holder of Registrable Securities in accordance with the rules and regulations of the NASD, (ii) all fees and expenses incurred in connection
with compliance with state or other securities or blue sky laws and compliance with the rules of the NASD (including reasonable fees and disbursements of counsel for any underwriters or Holders in
connection with qualification of any Registrable Securities under state or other securities or blue sky laws and any filing with and review by the NASD), (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and distributing any Registration Statement, any Prospectus, any amendments or supplements thereto, any underwriting agreements,
securities sales agreements, certificates representing the Securities and other documents relating to the performance of and compliance with this Agreement, (iv) all fees and expenses incurred
in connection with the listing, if any, of any of the Registrable Securities on any securities exchange or exchanges or on any quotation system, (v) all rating agency fees, (vi) all fees
and disbursements relating to the qualification of the Indenture under applicable securities laws, (vii) the fees and disbursements of counsel for the Company and the fees and expenses of
independent public accountants for the 

2

 

Company
or for any other Person, business or assets whose financial statements are included in any Registration Statement or Prospectus, including the expenses of any special audits or "cold comfort"
letters required by or incident to such performance and compliance, (viii) the fees and expenses of the Trustee, any registrar, any depositary, any paying agent, any escrow agent, any transfer
agent or any custodian, in each case including their respective counsel, (ix) the reasonable fees and expenses of the Initial Purchasers in connection with the Shelf Registration, including the
reasonable fees and expenses of one counsel to the Initial Purchasers and to the Holders of Registrable Securities, and (x) any fees and disbursements of the underwriters customarily paid by
issuers or sellers of securities and the fees and expenses of any special experts retained by the Company in connection with any Registration Statement, but excluding underwriting discounts and
commissions and any transfer taxes, if any, relating to the sale or disposition of Registrable Securities by a Holder. 

        "Registration Statement" shall mean any registration statement of the Company pursuant to the provisions of Section 2 of this
Agreement that covers all of the Registrable Securities held by Holders that have provided the information required pursuant to the terms of Section 2.1(d) hereof on an appropriate form under
Rule 415 under the 1933 Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all exhibits thereto and all material incorporated or deemed to be incorporated by reference therein. 

        "SEC" shall mean the United States Securities and Exchange Commission or any successor agency or government body performing the functions
currently performed by the United States Securities and Exchange Commission. 

        "Securities" shall mean the Notes and the shares of Common Stock into which the Notes are convertible, upon original issuance thereof, and
at all times subsequent thereto. 

        "Shelf Registration" shall have the meaning set forth in Section 2.1(a) hereof. 

        "TIA" shall mean the Trust Indenture Act of 1939, as amended from time to time, and the rules and regulations of the SEC promulgated
thereunder. 

        "Trustee" shall mean the trustee with respect to the Securities under the Indenture. 

        "Underwriters" or "underwriters" shall have the meaning set forth in Section 4(a)
hereof. 

        For
purposes of this Agreement, (i) all references in this Agreement to any Registration Statement or Prospectus or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the SEC pursuant to its Electronic Data Gathering, Analysis and Retrieval system; (ii) all references in this Agreement to financial statements and
schedules and other information which is "contained", "included" or "stated" in any Registration Statement or Prospectus (or other references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information which is incorporated or deemed to be incorporated by reference in such Registration Statement or Prospectus, as the case may be; and
(iii) all references in this Agreement to amendments or supplements to any Registration Statement or Prospectus shall be deemed to mean and include the filing of any document under the 1934 Act
which is incorporated or deemed to be incorporated by reference in such Registration Statement or Prospectus, as the case may be. 

        2.    Registration Under the 1933 Act.    

        2.1    Shelf Registration.    

        (a)   As
promptly as practicable, but no later than the Filing Date, the Company shall file with the SEC, a Registration Statement for an offering to be made on a continuous
basis pursuant to Rule 415 under the 1933 Act covering all of the Registrable Securities held by Holders that have provided the information pursuant to the terms of Section 2.1(d) hereof
(the "Shelf Registration"). 

3

 

The
Shelf Registration shall be on Form S-3 under the 1933 Act or another appropriate form permitting registration of such Registrable Securities for resale by the Holders in the
manner or manners reasonably designated by them (including, without limitation, one or more underwritten offerings). The Company shall use its reasonable best efforts to cause the Registration
Statement to be declared effective by the SEC as promptly as practicable, but no later than the Effectiveness Target Date, and to keep the Registration Statement continuously effective, supplemented
and amended, as required in order to permit the Prospectus forming a part thereof to be useable by the Holders until the earliest of (i) two years after the last date of issuance of the Notes,
(ii) the date when the Holders are able to sell all of their Securities immediately without restriction pursuant to the volume limitation provisions of Rule 144 under the 1933 Act or
otherwise, or (iii) all of the Registrable Securities covered by the Registration Statement have been sold pursuant to the Registration Statement (the "Effectiveness
Period"). 

        (b)   Notwithstanding
any other provisions hereof, the Company shall use its reasonable best efforts to ensure that (i) any Registration Statement and any amendment
thereto and any Prospectus forming a part thereof and any supplements thereto complies in all material respects with the 1933 Act, (ii) any Registration Statement and any amendment thereto does
not, when it becomes effective, contain 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 (iii) any Prospectus forming a part of any Registration Statement and any amendment or supplement to such Prospectus, does not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. 

        (c)   The
Company shall not permit any securities other than Registrable Securities to be included in the Registration Statement. The Company further agrees, if necessary, to
supplement or amend the Registration Statement, as required by Section 3(b) below. 

        (d)   Notwithstanding
any other provision hereof, no Holder of Registrable Securities may include any of its Registrable Securities in the Registration Statement pursuant to
this Agreement unless the Holder furnishes to the Company a completed questionnaire in the form attached as Annex A to the Offering Memorandum
(the "Questionnaire") and such other information in writing as the Company may reasonably request in writing for use in connection with the Registration
Statement or Prospectus included therein and in any application to be filed with or under state securities laws. Before the effectiveness of the Registration Statement and no later than the 20th
business day after receipt of the notice by a Holder from the Company of the filing of the Registration Statement (which notice shall include the Questionnaire and any other reasonable information
requested by the Company for use in connection with the Registration Statement), each such Holder of Registrable Securities must furnish the completed Questionnaire and such other information, if any,
to the Company in writing and the Company will include the information from the completed Questionnaire and such other information, if any, in the Registration Statement in a manner so that upon
effectiveness the Holders will be permitted to deliver the Prospectus to purchasers of the Holder's Securities. From and after the date that the Registration Statement is first declared effective,
upon receipt of a completed Questionnaire and such other information, if any, the Company will, as promptly as practicable but in any event within 5 business days of receipt, file any amendments or
supplements to the Registration Statement necessary for the relevant Holders to be named as selling securityholders in the Prospectus contained therein to be permitted to deliver the Prospectus to
purchasers of the Holder's Securities (subject to the Company's right to suspend the Registration Statement as described in Sections 3(e)(iii), 3(e)(v) and 3(e)(vi) below). Holders that do not
deliver a completed written Questionnaire and such other information, if any, in a timely manner, as provided for in this Section 2.1(d), will not be named as selling securityholders in the
Prospectus. Each Holder as 

4

 

to
which the Registration Statement is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make information previously furnished to the
Company by the Holder not materially misleading. 

        2.2    Expenses.    

        The
Company shall pay all Registration Expenses in connection with the Shelf Registration and any Registration Statement. Each Holder shall pay all fees and disbursements of its counsel
(other than as set forth in the preceding sentence or in the definition of Registration Expenses) and all underwriting discounts and commissions and transfer taxes, if any, relating to the sale or
disposition of such Holder's Registrable Securities pursuant to the Registration Statement. 

        2.3    Effectiveness.    

        The
Registration Statement shall not be deemed to have become effective unless it has been declared effective by the SEC; provided, however, that if, after it has been declared
effective, the offering of Registrable Securities pursuant to the Registration Statement is interfered with by any stop order, injunction or other order or requirement of the SEC or any other
governmental agency or court, such Registration Statement shall be deemed not to have been effective during the period of such
interference, until the offering of Registrable Securities pursuant to such Registration Statement may legally resume. 

        2.4    Liquidated Damages.    

        The
Company and the Initial Purchasers agree that the Holders of Registrable Securities will suffer damages if the Company fails to fulfill its obligations under Section 2.1
hereof and that it would not be feasible to ascertain the extent of such damages with precision. Accordingly, the Company agrees to pay liquidated damages on the Registrable Securities
("Liquidated Damages") under the circumstances and to the extent as set forth below. In the event that (a) the Registration Statement has not
been filed with the SEC on or prior to the Filing Date, (b) the Registration Statement is not declared effective by the SEC on or prior to the Effectiveness Target Date, (c) the
Registration Statement has been declared effective by the SEC and such Registration Statement ceases to be effective or usable at any time during the Effectiveness Period for any reason without being
succeeded within five business days by a post-effective amendment to such Registration Statement or a report filed with the SEC pursuant to the 1934 Act that cures such failure or
(d) the Company suspends the use of any Prospectus related to the Registration Statement for a period exceeding forty-five (45) days in any consecutive three-month period or
exceeding an aggregate of ninety (90) days in any consecutive twelve-month period (each such event referred to in clauses (a) through (d) above, a "Registration
Default"), then the interest rate borne by the Notes shall be increased as Liquidated Damages (x) by one-quarter of one percent (0.25%) per annum upon the
occurrence of such Registration Default up to and including the ninetieth (90th) day following such Registration Default and (y) by one half of one percent (0.50%) from and after the
ninety-first (91st) day following the occurrence of such Registration Default, provided that the aggregate increase in such interest rate will in no event exceed one half of one percent (0.50%) per
annum. Upon the cure of such Registration Default, the accrual of Liquidated Damages will cease and the interest rate will revert to the original rate so long as no other Registration Default shall
have occurred and shall be continuing at such time; provided, however, that, if after any such reduction in interest rate, one or more Registration Defaults shall again occur, the interest rate shall
again be increased pursuant to the foregoing provisions. A Registration Default under clause (a) above shall be cured on the date that the Shelf Registration is filed with the SEC; a
Registration Default under clause (b) above shall be cured on the date that the Shelf Registration is declared effective by the SEC; a Registration Default under clause (c) above shall
be cured on the date the Shelf Registration is declared effective or useable; and a Registration Default under clause (d) above shall be cured on the date the Prospectus is 

5

 

declared
useable by the Company. In the event of a Registration Default, the Company shall pay Liquidated Damages to (x) the holders of Notes and (y) the holders of Common Stock issued
upon conversion of Notes in proportion to the principal amount of such Notes converted. 

        The
Company shall notify the Trustee within three business days after each and every date on which a Registration Default occurs (an "Event
Date"). Liquidated Damages shall be paid by the Company to the Holders of Notes by depositing with the Trustee, in trust, for the benefit of the Holders of Notes, on or before
the applicable semiannual interest payment date, immediately available funds in sums sufficient to pay the Liquidated Damages then due. Such Liquidated Damages due shall be payable on each interest
payment date to the record Holder of Securities entitled to receive the interest payment
to be paid on such date as set forth in the Indenture. Liquidated Damages in respect of Common Stock issued upon conversion of Notes shall be payable by the Company to the holders of Common Stock
issued upon conversion of such Notes concurrently with the payment of Liquidated Damages to the holders of Notes. Each obligation to pay Liquidated Damages shall be deemed to accrue from and including
the day following the applicable Event Date. 

        3.    Registration Procedures.    

        In
connection with the obligations of the Company with respect to the Shelf Registration and the Registration Statement pursuant to Section 2 hereof, the Company shall: 

        (a)   prepare
and file with the SEC a Registration Statement within the period specified in Section 2, on the appropriate form under the 1933 Act, which form (i)
shall be selected by the Company, (ii) shall be available for the sale of the Registrable Securities by the selling Holders thereof, and (iii) shall comply as to form in all material
respects with the requirements of the applicable form and include or incorporate by reference all financial statements required by the SEC to be filed therewith or incorporated by reference therein,
and use its reasonable best efforts to cause such Registration Statement to become effective and remain effective in accordance with Section 2 hereof; 

        (b)   prepare
and file with the SEC such amendments and post-effective amendments to the Registration Statement as may be necessary under applicable law to keep
such Registration Statement effective for the applicable period; cause each Prospectus to be supplemented by any required prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 (or any similar provision then in force) under the 1933 Act; and comply with the provisions of the 1933 Act and the 1934 Act with respect to the disposition of all securities covered
by a Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the selling Holders thereof; 

        (c)   (i) notify
each Holder of Registrable Securities, as promptly as practicable, but in any event no less than five business days prior to filing, that a
Registration Statement with respect to the Registrable Securities is being filed (which notice shall include the Questionnaire and any other reasonable information requests referenced in
Section 2.1(d)) and advising such Holders that the distribution of Registrable Securities will be made in accordance with the method elected by the Majority Holders subject to
Section 2.1(a) above; (ii) furnish to each Holder of Registrable Securities, to counsel for the Holders, to counsel for the Initial Purchasers and to each underwriter of an underwritten
offering of Registrable Securities, if any, without charge, as many copies of the Prospectus included therein, including each preliminary Prospectus (in the event of an underwritten offering), and any
amendment or supplement thereto in order to facilitate the public sale or other disposition of the Registrable Securities; and (iii) subject to any notice by the Company in accordance with
Section 3(h) of the existence of any fact of the kind described in Sections 3(e)(iii), 3(e)(v) and 3(e)(vi) hereof, the Company hereby consents to the use of the Prospectus, including
each preliminary Prospectus (in the event of an underwritten offering), that 

6

 

is
contained in a Registration Statement declared effective by the SEC, or any amendment or supplement thereto by each of the Holders and underwriters of Registrable Securities in connection with the
offering and sale of the Registrable Securities covered by any Prospectus that is contained in a Registration Statement declared effective by the SEC or any amendment or supplement thereto; 

        (d)   use
its reasonable best efforts to register or qualify (or establish an exemption from such registration or qualification for) the Registrable Securities under all
applicable state securities or "blue sky" laws of such jurisdictions as any Holder of Registrable Securities covered by a Registration Statement and each underwriter of an underwritten offering of
Registrable Securities shall reasonably request, to cooperate with the Holders and the underwriters of any Registrable Securities in connection with any filings required to be made with the NASD, to
keep each such registration or qualification effective during the period such Registration Statement is required to be effective, and do any and all other acts and things which may be reasonably
necessary or advisable to enable such Holder and underwriter to consummate the disposition in each such jurisdiction of such Registrable Securities owned by such Holder; provided, however, that the
Company shall not be required to (i) qualify as a foreign corporation or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify but for this
Section 3(d) or (ii) take any action which would subject it to general service of process or taxation in any such jurisdiction if it is not then so subject; 

        (e)   notify
each Holder of Registrable Securities as promptly as reasonably practicable and, if requested by such Holder, confirm such advice in writing as promptly as
reasonably practicable (i) when a Registration Statement has become effective and when any post-effective amendments and supplements thereto become effective, (ii) of any
request by the SEC or any state securities authority for post-effective amendments or supplements to a Registration Statement or Prospectus or for additional information after a
Registration Statement has become effective, (iii) of the issuance by the SEC or any state securities authority of any stop order suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iv) if between the effective date of a Registration Statement and the closing of any sale of Registrable Securities covered thereby, the
representations and warranties of the Company contained in any underwriting agreement, securities sales agreement or other similar agreement, if any, relating to such offering cease to be true and
correct in all material respects, (v) of the happening of any event or the discovery of any facts during the period a Registration Statement is effective which makes any statement made in such
Registration
Statement or the related Prospectus untrue in any material respect or which constitutes an omission to state a material fact in such Registration Statement or Prospectus or which requires the making
of any changes in such Registration Statement or Prospectus in order to make the statements therein not misleading, (vi) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose and (vii) of any reasonable
determination by the Company that a post-effective amendment to a Registration Statement would be appropriate; 

        (f)    make
every reasonable effort to obtain the withdrawal of any order suspending the effectiveness of a Registration Statement as soon as practicable and provide notice as
promptly as reasonably practicable to each Holder of the withdrawal of any such order; 

        (g)   cooperate
with the selling Holders of Registrable Securities to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be
sold and not bearing any restrictive legends; and cause such Registrable Securities to be in such denominations (consistent with the provisions of the Indenture) and registered in such names as the
selling Holders or the underwriters, if any, may reasonably request in writing at least three business days prior to the closing of any sale of Registrable Securities; 

7

 

        (h)   upon
the occurrence of any event or the discovery of any facts, each as contemplated by Sections 3(e)(iii), 3(e)(v) and 3(e)(vi) hereof, as promptly as
practicable after the occurrence of such an event, use its reasonable best efforts to prepare a supplement or post-effective amendment to a Registration Statement or the related Prospectus
or any document incorporated or deemed to be incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities,
such Prospectus will not contain at the time of such delivery any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. The Company agrees to notify each Holder to suspend use of the Prospectus as promptly as practicable after the occurrence of such an
event, and each Holder hereby agrees to suspend use of the Prospectus until the Company has amended or supplemented the Prospectus to correct such misstatement or omission. At such time as such public
disclosure is otherwise made or the Company determines that such disclosure is not necessary, in each case to correct any misstatement of a material fact or to include any omitted material fact, the
Company agrees promptly to notify each Holder of such determination and to furnish each Holder such number of copies of the Prospectus, as amended or supplemented, as such Holder may reasonably
request; 

        (i)    a
reasonable time prior to the filing of any Registration Statement, any Prospectus, any amendment to a Registration Statement or amendment or supplement to a Prospectus
or a Prospectus after the initial filing of a Registration Statement, provide copies of such document to the Initial Purchasers on behalf of such Holders if requested by the Initial Purchasers; and
make representatives of the Company as shall be reasonably requested by the Holders of Registrable Securities, or the Initial Purchasers on behalf of such Holders, available for discussion of such
document; 

        (j)    obtain
CUSIP numbers for all Registrable Securities not later than the effective date of a Registration Statement, and provide the Trustee with printed certificates for
the Registrable Securities in a form eligible for deposit with the Depositary; 

        (k)   cause
the Indenture to be qualified under the TIA in connection with the registration of the Registrable Securities, (ii) cooperate with the Trustee and the
Holders to effect such changes, if any, to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the TIA and (iii) execute, and use its
reasonable best efforts to cause the Trustee to execute, all documents as may be required to effect such changes, if any, and all other forms and documents required to be filed with the SEC to enable
the Indenture to be so qualified in a timely manner; 

        (l)    subject
to Section 2.1(a), enter into agreements (including underwriting agreements) and take all other customary and appropriate actions in order to expedite or
facilitate the disposition of such Registrable Securities and in such connection, whether or not an underwriting agreement is entered into and whether or not the registration is an underwritten
registration: 

        (i)    make
such representations and warranties to the Holders of such Registrable Securities and the underwriters, if any, in form, substance and scope as are customarily made
by issuers to underwriters in similar underwritten offerings as may be reasonably requested by such Holders and underwriters; 

        (ii)   in
connection with any underwritten offering hereunder, seek to obtain opinions of counsel to the Company and updates thereof (which counsel and opinions (in form,
scope and substance) shall be reasonably satisfactory to the managing underwriters, if any, and the Holders of a majority in principal amount of the Registrable Securities being sold) addressed to
each selling Holder (where reasonably possible) and the underwriters, if any, covering the matters customarily covered in opinions requested in sales of securities or underwritten offerings and such
other matters as may be reasonably requested by such Holders and underwriters; 

8

  

        (iii)  in
connection with any underwritten offering hereunder, seek to obtain "comfort letters" and updates thereof with respect to such Registration Statement and the
Prospectus included therein, all amendments and supplements thereto and all documents incorporated or deemed to be incorporated by reference therein from the Company's independent certified public
accountants and (where reasonably practicable) from the independent certified public accountants for any other Person or any business or assets whose financial statements are, or are required to be,
included or incorporated by reference in the Registration Statement or Prospectus, each addressed to the underwriters, if any, and (where reasonably practicable) to have such letter addressed to the
selling Holders of Registrable Securities, such letters to be in customary form and covering matters of the type customarily covered in "comfort letters" to underwriters in connection with similar
underwritten offerings; 

        (iv)  if
an underwriting agreement is entered into, cause the same to set forth indemnification and contribution provisions and procedures substantially equivalent to the
indemnification and contribution provisions and procedures set forth in Section 4 hereof with respect to the underwriters and all other parties to be indemnified pursuant to Section 4
hereof or, at the request of any underwriters, in the form customarily provided to such underwriters in similar types of transactions; and 

         (v)  deliver
such other documents and certificates as may be reasonably requested and as are customarily delivered in similar offerings to the Holders of a majority in
principal amount of the Registrable Securities being sold and the managing underwriters, if any. 

The
above shall be done at (i) the effectiveness of such Registration Statement (and, if appropriate, each post-effective amendment thereto) and (ii) each closing under any
underwriting or similar agreement as and to the extent required thereunder; 

        (m)  if
reasonably requested in writing in connection with a disposition of Registrable Securities pursuant to a Registration Statement, make reasonably available for
inspection during normal business hours by representatives of the Holders of the Registrable Securities and any underwriters participating in any disposition pursuant to a Registration Statement and
any counsel or accountant retained by such Holders or underwriters, all relevant financial and other records, documents and properties of the Company reasonably requested by any such Persons, and
cause the appropriate officers, directors, employees, and any other agents of the Company to make all information reasonably requested by any such representative, underwriter, special counsel or
accountant in connection with a Registration Statement reasonably available for inspection during normal business hours, and make such representatives of the Company reasonably available for
discussion during normal business hours of such documents as shall be reasonably requested by the Initial Purchasers; provided,  however, that such persons
shall first agree in writing with the Company that any information that is reasonably designated by the Company in writing as
confidential at the time of delivery of such information shall be kept confidential by such persons and shall be used solely for the purposes of exercising rights under this Agreement, unless
(i) disclosure of such information is required by court or administrative order or is necessary to respond to inquiries of regulatory authorities;  provided, however, that such persons shall as promptly as reasonably practicable, provide written notice
to the Company of any request by any such regulatory authority for any such confidential information of the Company in order to allow the Company a reasonable amount of time to seek an appropriate
protective order to prevent the disclosure of such information, (ii) disclosure of such information is required by law (including any disclosure requirements pursuant to federal securities laws
in connection with the filing of any Registration Statement or the use of any Prospectus referred to in this Agreement), (iii) such information becomes generally available to the public other
than as a result of a disclosure or failure to safeguard by any such person or (iv) such information becomes available to any such 

9

 

person
from a source other than the Company and such source is not bound by a confidentiality agreement or otherwise obligated to keep such information confidential. 

        (n)   a
reasonable time prior to filing any Registration Statement, any Prospectus forming a part thereof, any amendment to such Registration Statement or amendment or
supplement to such Prospectus (other than supplements that do nothing more than name one or more Holders and provide information with respect thereto), provide copies of such document upon request to
the Initial Purchasers, to the underwriter or underwriters of an underwritten offering of Registrable Securities, if any, and, to counsel for the Initial Purchasers or underwriters, and make such
changes in any such document prior to the filing thereof as the Initial Purchasers or the underwriter or underwriters, or any of their respective counsel may reasonably request in writing within five
business days after the delivery of such copies by the Company; cause the representatives of the Company to be available for discussion of such documents during normal business hours as shall be
reasonably requested by the Initial Purchasers on behalf of the Holders or any underwriter or any of their respective counsel; and shall not at any time make any filing of any such document of which
the Initial Purchasers on behalf of the Holders, their counsel or any underwriter or their counsel shall not have previously been advised and furnished a copy or to which the Majority Holders, the
Initial Purchasers on behalf of the Holders, their counsel or any underwriter or their counsel shall reasonably object within a reasonable time period; 

        (o)   use
its reasonable best efforts to cause all Registrable Securities to be listed on any securities exchange or inter-dealer quotation system such as NASDAQ on which
similar debt or equity securities issued by the Company are then listed, if any; 

        (p)   use
its commercially reasonable efforts to cause the Registrable Securities to be rated with the appropriate rating agencies, if reasonably requested by the Majority
Holders or by the underwriter or underwriters of an underwritten offering of Registrable Securities, if any, unless the Registrable Securities are already so rated; 

        (q)   otherwise
comply with all applicable rules and regulations of the SEC and make available to its security holders, as soon as reasonably practicable, an earnings
statement covering at least twelve (12) months which shall satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder; and 

        (r)   cooperate
and assist in any filings required to be made with the NASD and in the performance of any due diligence investigation by any underwriter and its counsel
(including any "qualified independent underwriter" that is required to be retained in accordance with the rules and regulations of the NASD); 

        The
Company may (as a condition to such Holder's participation in the Shelf Registration) require each Holder of Registrable Securities to furnish to the Company such information
regarding such Holder and the proposed distribution by such Holder of such Registrable Securities as the Company may from time to time reasonably request in writing. Each Holder further agrees
promptly to furnish to the Company in writing all information required to be disclosed in order to make the information previously furnished to the Company by such Holder not misleading, any other
information regarding such Holder and the distribution of such Registrable Securities as may be required to be disclosed in the Registration Statement under applicable law or pursuant to SEC comments
and any information otherwise required by the Company to comply with applicable law or regulations. Each Holder further agrees, following termination of the Effectiveness Period, to notify the
Company, within ten business days of a request, of the amount of Registrable Securities sold pursuant to the Registration Statement and, in the absence of a response, the Company may assume that all
of the Holder's Registrable Securities were so sold. 

10

 

        Each
Holder agrees that, upon receipt of any notice from the Company of the happening of any event or the discovery of any facts, each of the kind described in Sections 3(e)(iii),
3(e)(v) or 3(e)(vi) hereof, such Holder will forthwith discontinue disposition of Registrable Securities pursuant to a Registration Statement until receipt by such Holder of
(i) the copies of the supplemented or amended Prospectus contemplated by Section 3(h) hereof or (ii) written notice from the Company that the Shelf Registration is once again
effective or that no supplement or amendment is required. If so directed by the Company, such Holder will deliver to the Company (at the Company's expense) all copies in such Holder's possession,
other than permanent file copies then in such Holder's possession, of the Prospectus covering such Registrable Securities current at the time of receipt of such notice. Nothing in this paragraph shall
prevent the accrual of Liquidated Damages on any Securities. 

        If
any of the Registrable Securities covered by any Registration Statement are to be sold in an underwritten offering, the underwriter or underwriters and manager or managers that will
manage such offering will be selected by the Majority Holders of such Registrable Securities included in such offering and shall be reasonably acceptable to the Company. No Holder of Registrable
Securities may participate in any underwritten registration hereunder unless such Holder (a) agrees to sell such Holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such arrangements, (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements and (c) provides the Company with the information required in Section 2.1(d) above. 

        4.    Indemnification and Contribution.    

        (a)   The
Company agrees to indemnify and hold harmless the Initial Purchasers, each Holder, each Person who participates as an underwriter (each, an
"Underwriter" or an "underwriter") and each Person, if any, who controls the Initial Purchasers, Holder
or Underwriter within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows: 

          (i)  against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement (or any amendment or supplement thereto) pursuant to which Registrable Securities were registered under the 1933 Act, including all documents incorporated
therein by reference, or any omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading, or arising out of any
untrue statement or alleged untrue statement of a material fact contained in any Prospectus (or any amendment or supplement thereto) or any omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; 

         (ii)  against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section 4(d) below) any such settlement is effected with the written consent of the Company; and 

        (iii)  against
any and all expense whatsoever, as incurred (including the reasonable fees and disbursements of counsel chosen by any indemnified party), reasonably incurred
in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under subparagraph (i) or (ii) above; 

11

 

provided,
however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Initial Purchasers, any Holder or Underwriter (or any person who
expressly controls the Initial Purchasers, Holder or Underwriter) expressly for use in a Registration Statement (or any amendment thereto) or any Prospectus (or any amendment or supplement thereto)  provided
further that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense if the Holder fails to deliver at or
prior to the written confirmation of sale, the most recent Prospectus, as amended or supplemented, and such Prospectus, as amended or supplemented, would have corrected such untrue statement or
omission or alleged untrue statement or omission of a material fact and the delivery thereof was required by law. 

        (b)   Each
Holder, severally but not jointly, agrees to indemnify and hold harmless the Company, the Initial Purchasers, each Underwriter and the other selling Holders, and
each of their respective directors and officers, and each Person, if any, who controls the Company, the Initial Purchasers, any Underwriter or any other selling Holder within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 4(a)
hereof, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or any Prospectus
included therein (or any amendment or supplement thereto) in reliance upon and in conformity with written information with respect to such Holder furnished to the Company by or on behalf of such
Holder or any other person who controls such Holder expressly for use in the Registration Statement (or any amendment thereto) or such Prospectus (or any amendment or supplement thereto); provided,
however, that no such Holder shall be liable for any claims hereunder in excess of the amount of net proceeds received by such Holder from the sale of Registrable Securities pursuant to such
Registration Statement. 

        (c)   Each
indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action or proceeding commenced against it in respect of
which indemnity may be sought hereunder, but failure so to notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially
prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement. An indemnifying party may participate
at its own expense in the defense of any such action; provided, however, that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying party or parties be liable for the fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel
for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this
Section 4 (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party. 

12

 

        (d)   If
at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying
party agrees that it shall be liable for any settlement of the nature contemplated by Section 4(a)(ii) effected without its written consent if (i) such settlement is entered into
more than forty-five (45) days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such
settlement at least thirty (30) days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with
such request prior to the date of such settlement. 

        (e)   If
the indemnification provided for in this Section 4 is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any
losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, in such proportion as is appropriate to reflect the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or
parties on the other hand in connection with the statements or omissions that resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations. 

        The
relative fault of such indemnifying party or parties on the one hand and the indemnified party or parties on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or parties or
such indemnified
party or parties, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 

        (f)    The
Company, the Holders and the Initial Purchasers agree that it would not be just or equitable if contribution pursuant to this Section 4 were determined by pro
rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (e) above. The aggregate amount of losses, liabilities,
claims, damages and expenses incurred by an indemnified party and referred to above in this Section 4 shall be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission. 

        Notwithstanding
the provisions of this Section 4, the Initial Purchasers or any Holder or Underwriter shall not be required to contribute any amount in excess of the amount by
which the total price at which Registrable Securities sold by it pursuant to a Registration Statement were offered exceeds the amount of any damages that the Initial Purchasers, Holder or Underwriter
has otherwise been required to pay by reason of any 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 1933 Act) shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. 

        For
purposes of this Section 4, each Person, if any, who controls the Initial Purchasers, Holder or Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as the Initial Purchasers or such Holder or Underwriter, as the case may be, and each director of the Company, each officer
of the Company who signed the Registration Statement and each Person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company. The respective obligations of the Initial Purchasers, Holders, and Underwriters to contribute pursuant to 

13

 

this
Section 4 are several in proportion to the principal amount of Securities sold by them pursuant to a Registration Statement and not joint. 

        The
indemnity and contribution provisions contained in this Section 4 shall remain operative and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of the Initial Purchasers or any Holder or Underwriter or any Person controlling the Initial Purchasers, or any Holder or Underwriter, or
by or on behalf of the Company, its officers, or directors or any Person controlling the Company and (iii) any sale of Registrable Securities pursuant to a Registration Statement. 

        5.    Miscellaneous.    

        5.1    Rule 144 and Rule 144A.    For so long or the Company is subject to the reporting requirements of
Section 13 or 15 of the 1934 Act, the Company covenants that it will file the reports required to be filed by it under the 1933 Act and Section 13(a) or 15(d) of the 1934 Act. If the
Company ceases to be subject to the reporting requirements of Section 13 or 15 of the 1934 Act, it will upon the request of any Holder or beneficial owner of Registrable Securities
(a) make publicly available such information (including, without limitation, the information specified in Rule 144A(d)(4) under the 1933 Act) as is necessary to permit sales pursuant to
Rule 144 under the 1933 Act, (b) deliver or cause to be delivered, promptly following a request by any Holder or beneficial owner of Registrable Securities or any prospective purchaser
or transferee designated by such Holder or beneficial owner, such information (including, without limitation, the information specified in Rule 144A(d)(4) under the 1933 Act) as is necessary to
permit sales pursuant to Rule 144A under the 1933 Act and it will take such further action as any Holder or beneficial owner of Registrable Securities may reasonably request, and
(c) take such further action that is reasonable in the circumstances, in each case, to the extent required from time to time to enable such Holder to sell its Registrable Securities without
registration under the 1933 Act within the limitation of the exemptions provided by (i) Rule 144 under the 1933 Act, as such Rule may be amended from time to time,
(ii) Rule 144A under the 1933 Act, as such Rule may be amended from time to time or (iii) any similar rules or regulations hereafter adopted by the SEC. Upon the request of any
Holder or beneficial owner of Registrable Securities, the Company will deliver to such Holder a written statement as to whether it has complied with such requirements. 

        5.2    No Inconsistent Agreements.    The Company has not entered into nor will the Company on or after the date of
this Agreement enter into any agreement which is inconsistent with the rights granted to the Holders of Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof. The
rights granted to the Holders hereunder do not for the term of this Agreement and will not in any way conflict with and are not and will not be inconsistent with the rights granted to the holders of
any of the Company's other issued and outstanding securities under any other agreements entered into by the Company or any of its subsidiaries. 

        5.3    Amendments and Waivers.    The provisions of this Agreement, including the provisions of this sentence, may not
be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the Company has obtained the written consent of Holders of at least a
majority in aggregate principal amount of the outstanding Registrable Securities affected by such amendment, modification, supplement, waiver or departure. 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 of 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 at least a majority of the Registrable
Securities being sold by such Holders pursuant to such Registration Statement; provided that the provisions of this sentence may not be amended, modified, or supplemented except in accordance with the
provisions of the immediately preceding sentence. Each Holder of Registrable Securities outstanding at the time of any such amendment, 

14

 

modification,
supplement, waiver or consent or thereafter shall be bound by any such amendment, modification, supplement, waiver or consent effected pursuant to this Section 5.3, whether or not
any notice, writing or marking indicating such amendment, modification, supplement, waiver or consent appears on the Registrable Securities or is delivered to such Holder. 

        5.4    Notices.    All notices and other communications provided for or permitted hereunder shall be made in writing
by hand delivery, registered first-class mail, telecopier or any courier guaranteeing overnight delivery (a) if to a Holder (other than the Initial Purchasers), at the most current address set
forth on the records of the registrar under the Indenture, (b) if to the Initial Purchasers, at the most current address given by the Initial Purchasers to the Company by means of a notice
given in accordance with the provisions of this Section 5.4, which address initially is the address set forth in the Purchase Agreement with respect to the Initial Purchasers with a copy to
Wilson Sonsini Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, Palo Alto, California 94304, Attention: Robert Claassen, (c) if to the Company, initially at the Company's
address set forth in the Purchase Agreement with a copy to Fenwick & West LLP, 801 California Street, Mountain View, California, 94014, Attention: Dennis DeBroeck, and thereafter at such other
address of which notice is given in accordance with the provisions of this Section 5.4, and (d) if to any Underwriter, at the most current address given by such Underwriter to the
Company by means of a notice given in accordance with the provisions of this Section 5.4, which address initially is the address set forth in the applicable underwriting agreement. 

        All
such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; two business days after being deposited in the mail,
postage prepaid, if mailed; when receipt is acknowledged, if telecopied; and on the next business day if timely delivered to an air courier guaranteeing overnight delivery. 

        Copies
of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee, at the address specified in the Indenture. 

        5.5    Successors and Assigns.    This Agreement shall inure to the benefit of and be binding upon the successors,
assigns and transferees of each of the parties, including, without limitation and without the need for an express assignment, subsequent Holders; provided, that (a) this Agreement shall not
inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquires Registrable Securities from a Holder and (b) nothing
herein shall be deemed to permit any assignment, transfer or other disposition of Registrable Securities in violation of the terms hereof or of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Registrable Securities, in any manner, whether by operation of law or otherwise, such Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities, such Person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this
Agreement, including the restrictions on resale set forth in this Agreement and, if applicable, the Purchase Agreement, and such person shall be entitled to receive the benefits hereof. 

        5.6    Third Party Beneficiaries.    The Initial Purchasers (even if the Initial Purchasers is not a Holder of
Registrable Securities) shall be third party beneficiaries of the agreements made hereunder between the Company, on the one hand, and the Holders, on the other hand, and shall have the right to
enforce such agreements directly to the extent they deem such enforcement necessary or advisable to protect their rights or the rights of Holders hereunder. Each Holder of Registrable Securities shall
be a third party beneficiary to the agreements made hereunder between the Company, on the one hand, and the Initial Purchasers, on the other hand, and shall have the right to enforce such agreements
directly to the extent it deems such enforcement necessary or advisable to protect its rights hereunder. 

15

 

        5.7    Restrictions on Resales    Until the expiration of two years after the original issuance of the Securities, the
Company will not, and will cause its "affiliates" (as such terms is defined in Rule 144(a)(1) under the 1933 Act) not to, resell any Securities which are "restricted securities" (or such term
is defined under Rule 144(a)(3) under the 1933 Act) that have been reacquired by any of them and shall immediately upon any purchase of any such Securities submit such Securities to the Trustee
for cancellation. 

        5.8    Headings.    The headings in this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof. 

        5.9    Severability.    In the event that any one or more of the provisions contained herein, or the application
thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby. 

        5.10    GOVERNING LAW.    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICTS OF LAWS. 

        5.11    Counterparts.    This Agreement may be executed in any number of counterparts and by the parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. 

16

 

        IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. 

	 	 	ADAPTEC, INC.
	

 	
 	
By:	

 
	 	 	 	

	

 	
 	

By:	

 
	 	 	 	

	Confirmed and accepted as of the date first above written:	 	 	 	 
	

MERRILL LYNCH & CO.	
 	

 
	MERRILL LYNCH, PIERCE, FENNER & SMITH	 	 
	 	 	INCORPORATED	 	 	 	 
	

BANC OF AMERICA SECURITIES LLC	
 	

 
	

By: MERRILL LYNCH, PIERCE, FENNER & SMITH	
 	

 
	 	 	INCORPORATED	 	 	 	 

	

By:	
 	

 	
 	

 	
 	

 
	 	 	
 Authorized Signatory

	 	 	 	 

17

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Exhibit 4.04    
    

COLLATERAL PLEDGE

AND SECURITY AGREEMENT  

 Dated as of December 22, 2003  

 among  

 ADAPTEC, INC.

as Pledgor,  

 WELLS FARGO BANK, N.A.

as Trustee,  

 and  

 WELLS FARGO BANK, N.A.

as Collateral Agent  

        This Collateral Pledge and Security Agreement (as supplemented from time to time, this "Pledge Agreement") is made and entered into as of December 22, 2003 among
ADAPTEC, INC., a Delaware corporation (the "Pledgor"), having its principal offices at 691 South Milpitas Blvd., Milpitas, California 95035, Wells Fargo Bank, N.A., having its principal
corporate trust office in California at 707 Wilshire Blvd., 17th Floor, Los Angeles, CA 90017, as trustee (in such capacity, the "Trustee") for the holders (the "Holders") of the Notes (as defined
herein) issued by the Pledgor under the Indenture referred to below, and Wells Fargo Bank, N.A., having a corporate trust office at 707 Wilshire Blvd., 17th Floor, Los Angeles, CA 90017, as collateral
agent for the Trustee and the holders from time to time of the Notes referred to below (in such capacity, the "Collateral Agent") and securities intermediary. 

W I T N E S S E T H:  

        WHEREAS, the Pledgor and Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), are parties to a Purchase Agreement dated
December 16, 2003 (the "Purchase Agreement"), pursuant to which the Pledgor will issue and sell to Merrill Lynch and Banc of America Securities LLC ("the Initial Purchasers") $200,000,000
aggregate principal amount of 3/4% Convertible Subordinated Notes due 2023, plus an additional $25,000,000 aggregate principal amount of 3/4% Convertible Subordinated
Notes due 2023 as to which the Initial Purchasers have exercised their over-allotment option set forth in Section 2(b) of the Purchase Agreement (collectively, the "Notes"); 

        WHEREAS,
the Pledgor and Wells Fargo Bank, N.A., as Trustee, have entered into that certain indenture dated as of the date hereof (as amended, restated, supplemented or otherwise
modified from time to time, the "Indenture"), pursuant to which the Pledgor is issuing the Notes on the date hereof; 

        WHEREAS,
pursuant to the Indenture, the Pledgor is required to purchase, or cause the purchase of, and pledge to the Collateral Agent for the benefit of the Trustee and the Holders, as
of the Closing Time (as defined in the Purchase Agreement) or the relevant Date of Delivery (as defined in the Purchase Agreement), U.S. Government Obligations (as defined in the Indenture) in an
amount that will be sufficient upon receipt of scheduled interest and principal payments of such securities, according to the written report of PricewaterhouseCoopers LLP or another nationally
recognized firm of independent public accountants selected by the Pledgor and delivered to the Trustee, to provide for payment in full of the first ten scheduled interest payments due on the Notes
(such obligation, together with the obligation to repay the principal, premium, if any, interest (including Liquidated Damages as defined in the Indenture, if any), fees, expenses or otherwise on the
Notes and under the Indenture, this Agreement and any other transaction document related thereto in the event that the Notes become due and payable prior to such time as the first ten scheduled
interest payments thereon shall have been paid in full, being collectively referred to herein as the "Obligations"); 

        WHEREAS,
the Pledgor has established an account (the "Collateral Account") with Wells Fargo Bank, N.A., at its office at 707 Wilshire Blvd., 17th Floor, Los Angeles, CA 90017, Account
No. 15404001, in
the name of Wells Fargo Bank, N.A., as Collateral Agent for the benefit of the Trustee and holders (the "Holders") of the 3/4% Convertible Subordinated Notes Due 2023 of
Adaptec, Inc. and designated as "Wells Fargo Collateral Agent for ADPT"; and 

        WHEREAS,
it is a condition precedent to the purchase of the Notes by the Initial Purchasers pursuant to the Purchase Agreement that the Pledgor purchase the Pledged Securities (as
defined below) and deposit such Pledged Securities into the Collateral Account to be held therein subject to the terms of this Pledge Agreement and shall have granted the assignment and security
interest and made the pledge and assignment contemplated by this Pledge Agreement. 

 

        NOW,
THEREFORE, in consideration of the premises herein contained, and in order to induce the Initial Purchasers to purchase the Notes, the Pledgor, the Trustee and the Collateral Agent
hereby agree, for the benefit of the Initial Purchasers and for the ratable benefit of the Holders, as follows: 

        SECTION
1.    Definitions; Appointment; Deposit and Investment.    

        1.1    Definitions.    

        (a)   Unless
otherwise defined in this Pledge Agreement, terms defined or referenced in the Indenture are used in this Pledge Agreement as such terms are defined or referenced
therein. 

        (b)   Unless
otherwise defined in the Indenture or in this Pledge Agreement, terms defined in Division 8 or 9 of the Uniform Commercial Code in effect in the State of
California ("California UCC") from time to time and/or in Section 357.2 of the Treasury Regulations (as defined in Section 1.1(c)) are used in this Pledge Agreement as such terms are
defined in such Division 8 or 9 and/or such Section 357.2. 

        (c)   In
this Pledge Agreement, the following terms have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms
defined): 

        "Additional
Pledged Securities" has the meaning specified in Section 1.3 hereof. 

        "Book-entry
Security" has the meaning specified in 31 C.F.R. Section 357.2. 

        "California
UCC" has the meaning specified in Section 1.1(b). 

        "Cash
Equivalents" means, to the extent owned by the Pledgor free and clear of all liens other than liens created hereunder, U.S. Government Obligations. 

        "C.F.R."
means U.S. Code of Federal Regulations. 

        "Collateral"
has the meaning specified in Section 1.3 hereof. 

        "Collateral
Account" has the meaning specified in the recitals of the parties hereof. 

        "Collateral
Agent" has the meaning specified in the recitals of the parties hereto. 

        "Collateral
Investments" has the meaning specified in Section 5 hereof. 

        "Date
of Delivery" has the meaning specified in the Purchase Agreement. 

        "Entitlement
holder" has the meaning specified in California UCC Section 8102(a)(7) or, in respect of any Book-entry Security, the meaning specified for "Entitlement
Holder" in 31 C.F.R. Section 357.2 or as applicable to such Book-entry Security, the corresponding federal book-entry regulations. 

        "Closing
Time" has the meaning specified in the Purchase Agreement. 

        "FRB"
means the Federal Reserve Bank or, as applicable, a branch thereof. 

        "FRB
Account" means the FRB Member Securities Account maintained in the name of the Collateral Agent by the FRB. 

        "FRB
Member" means any Person that is eligible to maintain (and that maintains) with the FRB one or more FRB Member Securities Accounts in such Person's name. 

        "FRB
Member Securities Account" means, in respect of any Person, the Participant's Securities Account maintained in the name of such Person at the FRB, to which account U.S. Government
Obligations held for such Person are or may be credited. 

        "Holders"
has the meaning specified in the recitals of the parties hereto. 

2

 

        "Initial
Pledged Securities" has the meaning specified in Section 1.3 hereof. 

        "Notes"
has the meaning specified in the recitals of the parties hereof. 

        "Obligations"
has the meaning specified in the recitals of the parties hereof. 

        "Initial
Purchaser" has the meaning specified in the recitals of the parties hereof. 

        "Purchase
Agreement" has the meaning specified in the recitals of the parties hereof. 

        "Pledged
Securities" has the meaning specified in Section 1.3 hereof. 

        "Pledgor"
has the meaning specified in the recitals of the parties hereto. 

        "Securities
intermediary" means a Person that is a "securities intermediary" (as defined in California UCC Section 8102(a)(14)) and, in respect of any Book-entry
Security, a "Securities Intermediary" (as defined in 31 C.F.R. Section 357.2 or, as applicable to such Book-entry Security, as defined in the corresponding federal
book-entry regulations). 

        "Security"
has the meaning specified in Section 8102(a)(15) of the California UCC or, in respect of any Book-entry Security, has the meaning specified for "Security"
in 31 C.F.R. Section 357.2 (or as applicable to such Book-entry Security, the corresponding federal book-entry regulations). 

        "Security
entitlement" has the meaning specified in California UCC Section 8102(a)(17) or, in respect of any Book-entry Security, has the meaning specified for
"Security Entitlement" in 31 C.F.R. Section 357.2 (or, as applicable to such Book-entry Security, the corresponding federal book-entry regulations). 

        "Settlement
Date" means, as to any U.S. Government Obligations, the date on which the purchase of such U.S. Government Obligations shall have been settled. 

        "Supplement"
has the meaning specified in Section 1.3 hereof, and shall be substantially in the form of Exhibit B hereto. 

        "Termination
Date" means the earlier of (a) the date of the payment in full in cash of each of the first ten scheduled interest payments due on the Notes under the terms of the
Indenture, (b) the date of the payment in full in cash of all Obligations due and owing under this Pledge Agreement, the Indenture and the Notes, in the event such Obligations become due and
payable prior to the payment of the first ten scheduled interest payments on the Notes and (c) such time as all Notes have been redeemed, purchased or converted pursuant to the terms of the
Indenture. 

        "Treasury
Regulations" means (a) the federal regulations contained in 31 C.F.R. Part 357 (including, without limitation, Section 357.2, Section 357.10 through
Section 357.14 and Section 357.41 through Section 357.44 of 31 C.F.R.) and (b) to the extent substantially identical to the federal regulations referred to in
clause (a) above (as in effect from time to time) the federal regulations governing other U.S. Government Obligations. 

        "Trustee"
has the meaning specified in the recitals of parties hereto. 

        "Uncertificated
Security" has the meaning specified in Section 8102(a)(18) of the California UCC. 

        1.2    Appointment of the Collateral Agent.    The Trustee hereby appoints the Collateral Agent as Collateral Agent in
accordance with the terms and conditions set forth herein and the Collateral Agent hereby accepts such appointment. 

        1.3    Pledge and Grant of Security Interest.    As security for the prompt and complete payment and performance when
due (whether at the stated maturity, by acceleration or otherwise) of the 

3

 

Obligations,
the Pledgor hereby assigns and pledges to the Collateral Agent for the benefit of the Trustee and the ratable benefit of the Holders and hereby grants to the Collateral Agent for the
benefit of the Trustee and for the ratable benefit of the Holders, a lien on and first priority perfected security interest in all of the Pledgor's right, title and interest in, to and under the
following property: (a) (i) the U.S. Government Obligations identified by CUSIP No. in Part I of Schedule I to this Pledge Agreement (the "Initial Pledged Securities") and
(ii) the U.S. Government Obligations, if any, identified by CUSIP No. in a supplement or supplements (each, a "Supplement," the form of which is attached hereto as Exhibit B) (the
"Additional Pledged Securities" and, together with the Initial Pledged Securities, the "Pledged Securities") and the certificates representing the Pledged Securities (if any), the scheduled payments
of principal and interest thereon which will be sufficient to provide for payment in full of the first ten scheduled interest payments due on the Notes, (b) the security entitlements described
in Part II of said Schedule I and in each Supplement, if any, with respect to the financial assets described, the securities intermediary named, and the securities account referred to
therein, (c) the Collateral Account, all security entitlements from time to time carried in the Collateral Account, all funds held therein and all certificates and instruments, if any, from
time to time representing or evidencing the Collateral Account, (d) all Collateral Investments (as hereinafter defined) from time to time and all certificates and instruments, if any,
representing or evidencing the Collateral Investments, and any and all security entitlements to the Collateral Investments, and any and all related securities accounts in which any security
entitlement to the Collateral Investments is carried, (e) all notes, certificates of deposit, deposit accounts, checks and other instruments, if any, from time to time hereafter delivered to or
otherwise possessed by the Collateral Agent for or on behalf of the Pledgor and specifically designated by the Pledgor to be in substitution for any or all of the then existing Collateral,
(f) all interest, dividends, cash, instruments and other property, if any, from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the
then existing Collateral and (g) all proceeds of any and all of the foregoing Collateral (including, without limitation, proceeds that constitute property of the types described in clauses
(a)-(f) of this Section 1.3) and, to the extent not otherwise included, all (i) payments under insurance (whether or not the Trustee is the loss payee thereof) or any indemnity, warranty
or guaranty, payable by reason of loss or damage to or otherwise with respect to any of the foregoing Collateral and (ii) cash proceeds of any and all of the foregoing Collateral (such property
described in clauses (a) through (g) of this Section 1.3 being collectively referred to herein as the "Collateral"). Without limiting the generality of the foregoing, this Pledge
Agreement secures the payment of all amounts that constitute part of the Obligations and would be owed by the Pledgor to the Trustee under the Notes, the Indenture, this Pledge Agreement and any other
transaction documents related thereto but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving the Pledgor. 

        SECTION
2.    Establishment and Maintenance of Collateral Account.    

        (a)   Prior
to or concurrently with the execution and delivery hereof, the Collateral Agent shall establish the Collateral Account on its books as a separate account
segregated from all other custodial or collateral accounts, at its office at 707 Wilshire Blvd., 17th Floor, Los Angeles, CA 90017. The Pledgor and the Collateral Agent will maintain the Collateral
Account as a securities account with the Collateral Agent in the State of California. The following provisions shall apply to the establishment and maintenance of the Collateral Account: 

        (i)    The
Collateral Agent shall cause the Collateral Account to be, and the Collateral Account shall be, separate from all other accounts maintained by the Collateral Agent. 

        (ii)   The
Collateral Agent shall, in accordance with all applicable laws, have sole dominion and control over the Collateral Account. 

4

 

        (iii)  It
shall be a term and condition of the Collateral Account and the Pledgor irrevocably instructs the Collateral Agent, notwithstanding any other term or condition to
the contrary in any other agreement, that no amount (including interest on Collateral Investments) shall be released to or for the account of, or withdrawn by or for the account of, the Pledgor or any
other Person except as expressly provided in this Pledge Agreement or as ordered by a court of competent jurisdiction. 

        (b)   On
or prior to (i) the Closing Time and (ii) the relevant Date of Delivery, if any, the Pledgor shall transfer, or cause to be transferred, to the
Collateral Agent, in the case of (i), approximately $7,914,567.80 or, in the case of (ii), an additional amount in cash to be set forth in the relevant Supplement, which amount shall be sufficient for
the Collateral Agent to purchase the Additional Pledged Securities, in each case by depositing all such funds into the Collateral Account. The Collateral Account shall be subject to such applicable
laws, and such applicable regulations of the Board of Governors of the Federal Reserve System and of any other appropriate banking or governmental authority, as may now or hereafter be in effect. 

        (c)   As
soon as practicably possible after receipt of the amount referred to in Section 2(b) (and not later than the Business Day following (A) the Closing Time
or (B) the relevant Date of Delivery, as the case may be), (i) the Collateral Agent shall apply such amount to purchase (1) in the case of (A) above, the U.S. Government
Obligations (in the name of the Collateral Agent) listed on Schedule I hereto, or (2) in the case of (B) above, the U.S. Government Obligations (in the name of the Collateral
Agent) listed on the relevant Supplement, and, in each case, credit such U.S. Government Obligations to the Collateral Account as Collateral hereunder; and (ii) the Collateral Agent shall
ensure that, on the Settlement Date of such U.S. Government Obligations, the FRB indicates by book-entry that those U.S. Government Obligations being settled on such date are credited to
the FRB Account. 

        (d)   The
Collateral Agent will, from time to time, reinvest the proceeds of Collateral that may mature or be sold in such Collateral Investments (in the name of the
Collateral Agent) as it will be directed in writing by the Pledgor, and cause such Collateral Investments to be credited to the Collateral Account as Collateral hereunder. Any such proceeds that the
Pledgor directs the Collateral Agent in writing not to reinvest in Collateral Investments shall be held in the Collateral Account. 

        SECTION
3.    Delivery and Control of Collateral.    

        (a)   All
certificates or instruments representing or evidencing Collateral shall be delivered to and held by or on behalf of the Collateral Agent pursuant hereto and shall be
in suitable form for transfer or delivery, or, at the request of the Collateral Agent, shall be accompanied by duly executed instruments of transfer or assignment in blank. In addition, the Collateral
Agent shall have the right at any time to exchange certificates or instruments representing or evidencing Collateral for certificates or instruments of smaller or larger denominations. 

        (b)   With
respect to any Collateral that constitutes a security and is not represented or evidenced by a certificate or instrument, the Pledgor shall cause the issuer thereof
either (i) to register the Collateral Agent as the registered owner of such security or (ii) to agree in writing with the Collateral Agent and the Pledgor that such issuer will comply
with instructions with respect to such security originated by the Collateral Agent without further consent of the Pledgor, the terms of such agreement to be consistent with the terms of this Agreement
(if applicable). 

        (c)   With
respect to any Collateral that constitutes a security entitlement, the Pledgor shall cause the securities intermediary (including, as applicable, the Collateral
Agent) with respect to such security entitlement either (i) to identify in its records the Collateral Agent as the entitlement holder of such security entitlement against such securities
intermediary or (ii) to agree in writing with the Pledgor and the Collateral Agent that such securities intermediary will comply with entitlement orders (that is, 

5

 

notifications
communicated to such securities intermediary directing transfer or redemption of the financial asset to which Pledgor has a security entitlement) originated by the Collateral Agent
without further consent of the Pledgor, the terms of such agreement to be consistent with the terms of this Agreement (if applicable). 

        (d)   With
respect to any Collateral that constitutes a securities account, the Pledgor will comply with subsection (c) of this Section 3 with respect to all
security entitlements carried in such securities account. 

        (e)   Concurrently
with the execution and delivery of this Pledge Agreement, the Collateral Agent is delivering, and concurrently with the execution and delivery of any
Supplement to the Pledge Agreement, the Collateral Agent will deliver, to the Pledgor and the Initial Purchasers a duly executed certificate, in the form of Exhibit A hereto, of an officer of
the Collateral Agent. 

        (f)    [RESERVED]

        (g)   Pledgor
hereby irrevocably authorizes the Collateral Agent at any time and from time to time to file in the Office of the Secretary of State of Delaware and any other
filing office in the United States any initial financing statements and amendments thereto that (a) contain a description of collateral of an equal or lesser scope as the Collateral described
in this Pledge Agreement or any Supplement, but such description may contain greater detail than is contained in this Pledge Agreement or any such Supplement, and (b) contain any other
information required by part 5 of Article 9 of the Uniform Commercial Code as in effect in any applicable jurisdiction for the sufficiency or filing office acceptance of any financing
statement or amendment therein, including whether the Pledgor is an organization, the type of organization and any organization identification number issued to the Pledgor. The Pledgor agrees to
furnish any such information to the Collateral Agent promptly upon request. The Pledgor also ratifies its authorization for the Collateral Agent to have filed in any Uniform Commercial Code
jurisdiction any initial financing statements or amendments thereto if filed prior to the date hereof. A photocopy or other reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement where permitted by law. 

        SECTION
4.    Delivery of Collateral Other than U.S. Government Obligations.    

        (a)   Collateral
consisting of cash will be deemed to be delivered to the Collateral Agent (such that the Collateral Agent will have an enforceable lien and security interest
thereon and therein) when it has been (and for so long as it shall remain) deposited in or credited to the Collateral Account. 

        (b)   [RESERVED].

        (c)   Collateral
consisting of Uncertificated Securities (other than U.S. Government Obligations) will be deemed delivered to the Collateral Agent when the Collateral Agent
(A) shall indicate by book entry that such securities have been credited to the Collateral Account or (B) shall receive such security (or a financial asset based on such security) for
the Collateral Account from or at the direction of the Pledgor, and shall accept such security (or such financial asset) for credit to the Collateral Account. 

        (d)   Collateral
consisting of securities, and represented or evidenced by certificates or instruments (other than U.S. Government Obligations), will be deemed delivered to
the Collateral Agent when all such certificates or instruments representing or evidencing the Collateral, including, without limitation, amounts invested as provided in Section 5, shall be
delivered to the Collateral Agent and held by or on behalf of the Collateral Agent pursuant hereto and shall be in registered form and specially indorsed to the Collateral Agent by an effective
endorsement, all in form and 

6

 

substance
sufficient to convey a valid security interest in such Collateral to the Collateral Agent or shall be credited to the Collateral Account. 

        SECTION
5.    Investing of Amounts in the Collateral Account.    The Collateral Agent shall advise the Pledgor if, at
any time, any amounts shall exist in the Collateral Account uninvested, and if directed in writing by the Pledgor, the Collateral Agent will, subject to the provisions of Section 6 and
Section 13; 

        (a)   invest
such amounts on deposit in the Collateral Account in such Cash Equivalents in the name of the Collateral Agent as the Pledgor may select; and 

        (b)   invest
interest paid on the Cash Equivalents referred to in clause (a) above, and reinvest other proceeds of any such Cash Equivalents that may mature or be sold,
in each case in such Cash Equivalents in the name of the Collateral Agent, as the Pledgor may select (the Cash Equivalents referred to in clauses (a) and (b) above, together with the
Pledged Securities, being collectively referred to herein as "Collateral Investments"); provided, however, that the amount in cash and Pledged
Securities on deposit in the Collateral Account, collectively, at any time during the term of this Pledge Agreement, is sufficient to provide for the payment in full of the remaining interest payments
at such time on the Notes up to and including the tenth scheduled interest payment. Interest and proceeds that are not invested or reinvested in Collateral Investments as provided above shall be
deposited and held in the Collateral Account. Except as otherwise provided in Sections 11 and 12, the Collateral Agent shall not be liable for any loss in the investment or reinvestment of amounts
held in the Collateral Account. The Collateral Agent is not at any time under any duty to advise or make any recommendation for the purchase, sale, retention or disposition of the Collateral
Investments. 

        (c)   If
the Pledgor does not select Cash Equivalents when required to do so pursuant the preceding subparagraphs (a) or (b) of this Section 5, then the
Collateral Agent shall, without any further direction from the Pledgor, invest any uninvested amounts on deposit in the Collateral Account in money market funds invested in government obligations for
which the Collateral Agent or an affiliate acts as an investment provider. 

        SECTION
6.    Disbursements.    The Collateral Agent shall hold the Collateral in the Collateral Account and release
the same, or a portion thereof, only as follows: 

        (a)   Prior
to each of the first ten scheduled interest payments on the Notes, the Collateral Agent shall release from the Collateral Account and pay to the Trustee for the
benefit of, and payment to, the Holders of the Notes in accordance with the provisions of the Indenture an amount sufficient to pay the interest due on the Notes on such interest payment date and will
take any action necessary to provide for the payment of the interest on the Notes to the Holders in accordance with the payment provisions of the Indenture from (and to the extent of) proceeds of the
Collateral in the Collateral Account. Nothing in this Section 6 shall affect the Collateral Agent's rights to apply the Collateral to the payments of amounts due on the Notes upon acceleration
thereof. 

        (b)   If,
prior to the date on which the tenth scheduled interest payment on the Notes is due: 

        (i)    an
Event of Default under the Notes occurs and is continuing and 

        (ii)   the
Trustee or the Holders of 25% in aggregate principal amount of the Notes accelerate the Notes by declaring the principal amount of the Notes to be immediately due
and payable in accordance with the provisions of the Indenture, except for the occurrence and continuance of an Event of Default under Sections 8.1(4) and (5) of the Indenture, upon which the
Notes will be accelerated automatically pursuant to the Indenture, 

then
the Collateral Agent shall promptly, subject to applicable bankruptcy laws, release the proceeds from the Collateral Account and pay to the Trustee for the benefit of, and payment to, the Holders
of 

7

 

the
Notes in accordance with the provisions of the Indenture. Distributions from the Collateral Account shall be applied, for the ratable benefit of the Holders, as follows: 

        (x)   first,
to any accrued and unpaid interest on the Notes and 

        (y)   second,
to the extent available, to the repayment of the remaining Obligations, including the principal amount of the Notes. 

        Any
surplus of such proceeds held by the Collateral Agent and remaining after payment in full of all of the Obligations shall be paid over to the Pledgor. 

        (c)   [RESERVED]

        (d)   In
the event that the Collateral held in the Collateral Account is less than 100% of the amount sufficient, according to the written report of PricewaterhouseCoopers LLP
or another nationally recognized firm of independent public accountants selected by the Pledgor, to provide for payment in full of the first ten scheduled interest payments due on the Notes (or, in
the event an interest payment or payments have been made, an amount sufficient to provide for payment in full of all interest payments remaining, up to and including the tenth scheduled interest
payment), the Pledgor shall deposit cash in the Collateral Account in the amount of such deficiency within five (5) days of the occurrence of such deficiency. 

        (e)   In
the event that the Collateral held in the Collateral Account exceeds 100% of the amount sufficient, according to the written report of PricewaterhouseCoopers LLP or
another nationally recognized firm of independent public accountants selected by the Pledgor, to provide for payment in full of the first ten scheduled interest payments due on the Notes (or, in the
event an interest payment or payments have been made, an amount sufficient to provide for payment in full of all interest payments remaining, up to and including the tenth scheduled interest payment),
the Collateral Agent shall release to the Pledgor, at the Pledgor's written request, accompanied by the written report prepared by PricewaterhouseCoopers LLP or such other nationally recognized firm
of independent public accountants, any such excess Collateral. 

        (f)    Upon
the release of any Collateral from the Collateral Account, in accordance with the terms of this Pledge Agreement, the security interest and lien evidenced by this
Pledge Agreement in such released Collateral will automatically terminate and be of no further force and effect; provided that the foregoing shall not
affect the security interest and lien on any Collateral not so released. 

        (g)   Except
as expressly provided in this Section 6, nothing contained in this Pledge Agreement shall (i) afford the Pledgor any right to issue entitlement
orders with respect to any security entitlement to the Pledged Securities or Collateral Investments or any securities account in which any such security entitlement may be carried, or otherwise afford
the Pledgor control of any such security entitlement or (ii) otherwise give rise to any rights of the Pledgor with respect to the Collateral Investments, any security entitlement thereto or any
securities account in which any such security entitlement may be carried, other than the Pledgor's rights under this Pledge Agreement as the beneficial owner of Collateral pledged to and subject to
the exclusive dominion and control (including, without limitation, securities control) of the Collateral Agent in its capacity as such (and not as a securities intermediary). The Pledgor acknowledges,
confirms and agrees that the Collateral Agent holds a first priority perfected security interest, lien and security entitlement to the Collateral Investments solely as collateral agent for the Trustee
and the Holders and not as a securities intermediary for the Pledgor. 

        SECTION
7.    Representations and Warranties.    The Pledgor hereby represents and warrants, as of the date hereof,
that: 

        (a)   The
execution and delivery by the Pledgor of, and the performance by the Pledgor of its obligations under, this Pledge Agreement will not contravene any provision of
applicable law or the certificate of incorporation, bylaws or equivalent organizational instruments of the Pledgor or 

8

 

any
material agreement or other material instrument binding upon the Pledgor or any of its subsidiaries or any judgment, order or decree of any governmental body, agency or court having jurisdiction
over the Pledgor or any of its subsidiaries, or result in the creation or imposition of any lien on any assets of the Pledgor, except for the lien and security interests granted under this Pledge
Agreement; no consent, approval, authorization or order of, or qualification with, and no notice to or filing with, any governmental body or agency or other third party is required (i) for the
performance by the Pledgor of its obligations under this Pledge Agreement, (ii) for the pledge by the Pledgor of the Collateral pursuant to this Pledge Agreement or for the execution, delivery
or performance of this Agreement by the Pledgor or (iii) for the perfection or maintenance of the pledge, assignment and security interest created hereby (including the first priority nature of
such pledge, assignment or security interest), except for the filing of financing and continuation statements under the Uniform Commercial Code of applicable jurisdictions which financing statements
have been delivered pursuant to Section 3(g) hereof, or (iv) except for any such consents, approvals, authorizations or orders required to be obtained by the Collateral Agent (or the
Holders) for reasons other than the consummation of this transaction, for the exercise by the Collateral Agent of the rights provided for in this Pledge Agreement or the remedies in respect of the
Collateral pursuant to this Pledge Agreement. 

        (b)   The
Pledgor is the legal and beneficial owner of the Collateral, free and clear of any lien or claims of any Person (except for the lien and security interests granted
under this Pledge Agreement). No effective financing statement or other instrument similar in effect covering all or any part of the Collateral is on file in any public office other than the financing
statements, if any, to be filed pursuant to this Pledge Agreement. 

        (c)   This
Pledge Agreement has been duly authorized, validly executed and delivered by the Pledgor and (assuming the due authorization and valid execution and delivery of
this Pledge Agreement by each of the Trustee and the Collateral Agent and enforceability of the Pledge Agreement against each of the Trustee and the Collateral Agent in accordance with its terms)
constitutes a valid and binding agreement of the Pledgor, enforceable against the Pledgor in accordance with its terms, except as (i) the enforceability hereof may be limited by bankruptcy,
insolvency, fraudulent conveyance, preference, reorganization, moratorium or similar laws now or hereafter in effect relating to or affecting the rights or remedies of creditors generally,
(ii) the availability of equitable remedies may be limited by equitable principles of general applicability and the discretion of the court before which any proceeding therefor may be brought,
(iii) the exculpation provisions and rights to indemnification hereunder may be limited by U.S. federal and state securities laws and public policy considerations and (iv) the waiver of
rights and defenses contained in Section 13(b), Section 18.11 and Section 18.15 hereof may be limited by applicable law. 

        (d)   Upon
the crediting of the Pledged Securities to the Collateral Account in accordance with the terms hereof and the filing of the financing statements referred to in
Section 3(g) hereof, the pledge of and grant of a security interest in the Collateral securing the payment of the Obligations for the benefit of the Trustee and the Holders will constitute a
valid, first priority, perfected security interest in such
Collateral (except, with respect to proceeds, only to the extent permitted by Section 9315 of the California UCC), enforceable as such against all creditors of the Pledgor and any persons
purporting to purchase any of the Collateral from the Pledgor other than as permitted by the Indenture. Upon filing of the financing statements described in Section 3(g) hereof, all filings and
other actions necessary or desirable to perfect and protect such security interest will have been duly taken. 

9

  

        (e)   There
are no legal or governmental proceedings pending or, to the best of the Pledgor's knowledge, threatened to which the Pledgor or any of its subsidiaries is a party
or to which any of the properties of the Pledgor or any of its subsidiaries is subject that would materially adversely affect the power or ability of the Pledgor to perform its obligations under this
Pledge Agreement or to consummate the transactions contemplated hereby. 

        (f)    The
pledge of the Collateral pursuant to this Pledge Agreement is not prohibited by law or governmental regulation (including, without limitation, Regulations T, U and X
of the Board of Governors of the Federal Reserve System) applicable to the Pledgor. 

        (g)   No
Event of Default exists. 

        (h)   The
Pledgor is a corporation duly organized and validly existing under the laws of the State of Delaware. The Pledgor's name as it appears in official filings in the
State of Delaware is ADAPTEC, INC. The Pledgor's organizational identification number issued by the State of Delaware is 2821928. 

        SECTION
8.    Further Assurances.    The Pledgor will, promptly upon the request by the Collateral Agent (which
request the Collateral Agent may submit at the direction of the Holders of a majority in aggregate principal amount of the Notes then outstanding), execute and deliver or cause to be executed and
delivered, or use its reasonable best efforts to procure, all assignments, instruments and other documents, deliver any instruments to the Collateral Agent and take any other actions that are
necessary or desirable to perfect, continue the perfection of, or protect the first priority of the Collateral Agent's security interest in and to the Collateral, to protect the Collateral against the
rights, claims or interests of third persons (other than any such rights, claims or interests created by or arising through the Collateral Agent) or to effect the purposes of this Pledge Agreement.
Without limiting the generality of the foregoing, the Pledgor will, if any Collateral shall be evidenced by a promissory note or other instrument, deliver to the Collateral Agent in pledge hereunder
such note or instrument duly indorsed and accompanied by duly executed instruments of transfer or assignment; and execute and file such financing or continuation statements, or amendments thereto, and
such other instruments or notices, as may be necessary, or as the Collateral Agent may reasonably request, in order to perfect and preserve the pledge, assignment and first priority perfected security
interest granted or purported to be granted hereby. The Pledgor will promptly pay all costs incurred in connection with any of the foregoing within 45 days of receipt of an invoice therefor.
The Pledgor also agrees, whether or not requested by the Collateral Agent, to use its reasonable best efforts to perfect or continue the perfection of, or to protect the first priority of, the
Collateral Agent's security interest in and to the Collateral, and to protect the Collateral against the rights, claims or interests of third persons (other than any such rights, claims or interests
created by or arising through the Collateral Agent). 

        SECTION
9.    Covenants.    The Pledgor covenants and agrees with the Collateral Agent, Trustee and the Holders that
from and after the date of this Pledge Agreement until the Termination Date: 

        (a)   it
will not (i) (and will not purport to) sell or otherwise dispose of, or grant any option or warrant with respect to, any of the Collateral nor
(ii) create or permit to exist any lien upon or with respect to any of the Collateral (except for the liens and security interests granted under this Pledge Agreement and any lien created by or
arising through the Collateral Agent) and at all times will be the sole beneficial owner of the Collateral; 

        (b)   it
will not (i) enter into any agreement or understanding that restricts or inhibits or purports to restrict or inhibit the Trustee's or the Collateral Agent's
rights or remedies hereunder, including, without limitation, the Collateral Agent's right to sell or otherwise dispose of the Collateral or (ii) fail to pay or discharge any tax, assessment or
levy of any nature with respect to its beneficial interest in the Collateral not later than three Business Days prior to the date of any proposed sale under any judgment, writ or warrant of attachment
with respect to the Collateral; 

10

 

        (c)   it
will maintain its jurisdiction of organization in the State of Delaware, or upon 30 days' prior written notice to the Collateral Agent, in another jurisdiction
where all actions required by Sections 3(g) and 8 have been taken with respect to the Collateral; 

        (d)   it
will, and will cause the Trustee and the Collateral Agent to, execute and deliver on or prior to any Date of Delivery, a Supplement to this Pledge Agreement
substantially in the form of Exhibit B hereto, and take such other actions as shall be necessary to grant to the Collateral Agent, for the benefit of the Trustee and the ratable benefit of the
Holders, a valid assignment of and security interest in the Additional Pledged Securities and the related security entitlements; and 

        (e)   it
will not, and acknowledges that it is not authorized to, file any financing statement or amendment or termination statement with respect to any financing statement in
favor of the Collateral Agent without the prior written consent of Collateral Agent and agrees that it will not do so without the prior written consent of Collateral Agent, subject to the Pledgor's
rights under Section 9509(d)(2) of the California UCC. 

        SECTION
10.0    Power of Attorney; Agent May Perform.    

        (a)   Subject
to the terms of this Pledge Agreement, the Pledgor hereby appoints and constitutes the Collateral Agent as the Pledgor's attorney-in-fact
(with full power of substitution) to exercise to the fullest extent permitted by law all of the following powers upon and at any time after the occurrence and during the continuance of an Event of
Default: 

        (i)    collection
of proceeds of any Collateral; 

        (ii)   conveyance
of any item of Collateral to any purchaser thereof; 

        (iii)  giving
of any notices or recording of any liens hereof; and 

        (iv)  paying
or discharging taxes or liens levied or placed upon the Collateral, the legality or validity thereof and the amounts necessary to discharge the same to be
determined by the Collateral Agent in its sole reasonable discretion, and such payments made by the Collateral Agent to become part of the Obligations secured hereby, due and payable immediately upon
demand. The Collateral Agent's authority under this Section 10 shall include, without limitation, the authority to endorse and negotiate any checks or instruments representing proceeds of
Collateral in the name of the Pledgor, execute and give receipt for any certificate of ownership or any document constituting Collateral, transfer title to any item of Collateral, sign the Pledgor's
name on all financing statements (to the extent permitted by applicable law) or any other documents necessary or appropriate to preserve, protect or perfect the security interest in the Collateral and
to file the same, prepare, file and sign the Pledgor's name on any notice of lien (to the extent permitted by applicable law), and to take any other actions arising from or necessarily incident to the
powers granted to the Trustee or the Collateral Agent in this Pledge Agreement. This power of attorney is coupled with an interest and is irrevocable by the Pledgor. 

        (b)   If
the Pledgor fails to perform any agreement contained herein, the Collateral Agent may, but is not obligated to, after providing to the Pledgor notice of such failure
and five Business Days to effect such performance, itself perform, or cause performance of, such agreement, and the expenses of the Collateral Agent incurred in connection therewith shall be payable
by the Pledgor under Section 14. 

        SECTION
11.    No Assumption of Duties; Reasonable Care.    The rights and powers granted to the Collateral Agent
hereunder are being granted in order to preserve and protect the security interest of the Collateral Agent for the benefit of the Trustee and the Holders in and to the Collateral granted hereby and
shall not be interpreted to, and shall not impose any duties on, the Collateral Agent in connection therewith other than those expressly provided herein or imposed under applicable law. 

11

 

Except
as provided by applicable law or by the Indenture, the Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if
the Collateral is accorded treatment substantially equal to that which the Collateral Agent accords similar property held by the Collateral Agent for similar accounts, it being understood that the
Collateral Agent in its capacity as such 

        (a)   may
consult with counsel of its selection and the advice of such counsel or any opinion of such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; and 

        (b)   shall
not have any responsibility for 

        (i)    ascertaining
or taking action with respect to calls, conversions, exchanges, maturities or other matters relative to any Collateral, whether or not the Collateral Agent
has or is deemed to have knowledge of such matters, 

        (ii)   taking
any necessary steps for the existence, enforceability or perfection of any security interest of the Collateral Agent or to preserve rights against any parties
with respect to any Collateral or 

        (iii)  except
as otherwise set forth in Section 5, investing or reinvesting any of the Collateral, provided, however,
that in the case of clause (a) and clause (b) of this sentence, nothing contained in this Pledge Agreement shall relieve the Collateral Agent of any responsibilities as a securities
intermediary under applicable law. 

        In
no event shall the Collateral Agent be liable for the existence, validity, enforceability or perfection of any security interest of the Collateral Agent, or for special indirect or
consequential damages or lost profits or loss of business, arising in connection with this Agreement. 

        SECTION
12.    Indemnity.    The Pledgor shall fully indemnify, hold harmless and defend the Collateral Agent and its
directors and officers from and against any and all claims, losses, actions, obligations, liabilities and expenses, including reasonable defense costs, reasonable investigative fees and costs, and
reasonable legal fees, expenses, and damages arising from the Collateral Agent's appointment and performance as Collateral Agent under this Pledge Agreement, except to the extent that such claim,
action, obligation, liability or expense is directly caused by the bad faith, gross negligence or willful misconduct of such indemnified person. The provisions of this Section 12 shall survive
termination of this Pledge Agreement and the resignation and removal of the Collateral Agent. 

        SECTION
13.    Remedies upon Event of Default.    Subject to Section 6(b), if any Event of Default under the
Indenture shall have occurred and be continuing and the Notes shall have been accelerated in accordance with the provisions of the Indenture: 

        (a)   The
Trustee, the Collateral Agent and the Holders shall have, in addition to all other rights given by law or by this Pledge Agreement or the Indenture, all of the
rights and remedies with respect to the Collateral of a secured party upon default under the California UCC (whether or not the California UCC applies to the affected Collateral) at that time. In
addition, with respect to any Collateral that shall then be in or shall thereafter come into the possession or custody of the Collateral Agent, the Collateral Agent may and, at the written direction
of the Trustee or the Holders of a majority in aggregate principal amount of the Notes then outstanding, shall appoint a broker or other expert to sell or cause the same to be sold at any broker's
board or at public or private sale, in one or more sales or lots, at such price or prices such broker or other expert may deem commercially reasonable, for cash or on credit or for future delivery,
without assumption of any credit risk. The purchaser of any or all Collateral so sold shall thereafter hold the same absolutely, free from any claim, encumbrance or right of any kind whatsoever
created by or through the Pledgor. Unless any of the Collateral threatens, in the reasonable judgment of the 

12

 

Collateral
Agent, to decline speedily in value, the Collateral Agent will give the Pledgor reasonable notice of the time and place of any public sale thereof, or of the time after which any private
sale or other intended disposition is to be made. Any sale of the Collateral conducted in conformity with reasonable commercial practices of banks, insurance companies, commercial finance companies,
or other financial institutions disposing of property similar to the Collateral shall be deemed to be commercially reasonable. Any requirements of reasonable notice shall be met if notice of the time
and place of any public sale or the time after which any private sale is to be made is given to the Pledgor as provided in Section 18.1 hereof at least ten (10) days before the time of
the sale or disposition. The Collateral Agent or any Holder may, in its own name or in the name of a designee or nominee, buy any of the Collateral at any public sale and, if permitted by applicable
law, at any private sale. The Collateral Agent shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Collateral Agent may adjourn any public or
private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. All expenses
(including court costs and reasonable attorneys' fees, expenses and disbursements) of, or incident to, the enforcement of any of the provisions hereof shall be recoverable from the proceeds of the
sale or other disposition of the Collateral. 

        (b)   The
Pledgor further agrees to use its reasonable best efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales of all or any
portion of the Collateral pursuant to this Section 13 valid and binding and in compliance with any and all other applicable
requirements of law. The Pledgor further agrees that a breach of any of the covenants contained in this Section 13 will cause irreparable injury to the Trustee and the Holders, that the Trustee
and the Holders have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 13 shall be specifically enforceable
against the Pledgor, and the Pledgor hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that no Event of Default has
occurred and is continuing or that the Notes have been accelerated in accordance with the provisions of the Indenture. 

        (c)   All
cash proceeds received by the Collateral Agent in respect of any sale of, collection from, or other realization upon all or any part of the Collateral may, in the
discretion of the Collateral Agent, be held by the Collateral Agent as collateral for, and/or then or at any time thereafter applied (after payment of any amounts payable to the Collateral Agent or
the Trustee pursuant to Section 14) by the Collateral Agent for the ratable benefit of the Holders first against any accrued and unpaid interest on the Notes and thereafter against the
remaining Obligations. Any surplus of such cash or cash proceeds held by the Collateral Agent and remaining after payment in full of all of the Obligations shall be paid over to the Pledgor. 

        (d)   The
Collateral Agent may, but is not obligated to, exercise any and all rights and remedies of the Pledgor in respect of the Collateral. 

        (e)   Subject
to and in accordance with the terms of this Pledge Agreement, all payments received by the Pledgor in respect of the Collateral shall be received in trust for
the benefit of the Collateral Agent, shall be segregated from other funds of the Pledgor and shall be forthwith paid over to the Collateral Agent in the same form as so received (with any necessary
endorsement). 

        (f)    The
Collateral Agent may, without notice to the Pledgor except as required by law and at any time or from time to time, charge, set-off and otherwise apply
all or any part of the Obligations against the Collateral Account or any part thereof. 

        (g)   The
Pledgor shall cease to be entitled to direct the investment of amounts held in the Collateral Account under Section 5 hereof and the Collateral Agent shall
not accept any direction from the Pledgor to invest amounts held in the Collateral Account. 

13

 

        SECTION
14.    Fees and Expenses.    Pledgor agrees to pay to Collateral Agent the fees as may be agreed upon from
time to time in writing. The Pledgor will upon demand pay to the Trustee and the Collateral Agent the amount of any and all expenses, including, without limitation, the reasonable fees, expenses and
disbursements of counsel, experts and agents retained by the Trustee and the Collateral Agent, that the Trustee and the Collateral Agent may incur in connection with 

        (a)   the
review, negotiation and administration of this Pledge Agreement; 

        (b)   the
custody or preservation of, or the sale of, collection from, or other realization upon, any of the Collateral; 

        (c)   the
exercise or enforcement of any of the rights of the Collateral Agent, the Trustee and the Holders hereunder; or 

        (d)   the
failure by the Pledgor to perform or observe any of the provisions hereof. 

        SECTION
15.    Security Interest Absolute.    All rights of the Collateral Agent, the Trustee and the Holders and
security interests hereunder, and all obligations of the Pledgor hereunder, shall be absolute and unconditional irrespective of: 

        (a)   any
lack of validity or enforceability of the Indenture or any other agreement or instrument relating thereto; 

        (b)   any
change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any
departure from the Indenture; 

        (c)   any
exchange, surrender, release or non-perfection of any liens on any other collateral for all or any of the Obligations; 

        (d)   any
change, restructuring or termination of the corporate structure or the existence of the Pledgor or any of its subsidiaries; 

        (e)   to
the extent permitted by applicable law, any other circumstance which might otherwise constitute a defense available to, or a discharge of, the Pledgor in respect of
the Obligations or of this Pledge Agreement; or 

        (f)    any
manner of application of other collateral, or proceeds thereof, to all or any item of the Obligations, or any manner of sale or other disposition of any item of
Collateral for all or any of the Obligations. 

        SECTION
16.    Collateral Agent's Representations, Warranties and Covenants.    The Collateral Agent (in its capacity
as securities intermediary) represents and warrants that it is as of the date hereof, and it agrees that for so long as it maintains the Collateral Account and acts as the securities intermediary
pursuant to this Pledge Agreement it shall be a securities intermediary and a FRB Member. In furtherance of the foregoing, the Collateral Agent (in its capacity as securities intermediary) hereby: 

        (a)   represents
and warrants that it is a commercial bank that in the ordinary course of its business maintains securities accounts for others and is acting in that capacity
hereunder and with respect to the Collateral Account; 

        (b)   represents
and warrants that it maintains the FRB Account with the FRB; 

        (c)   agrees
that the Collateral Account shall be an account to which financial assets may be credited, and undertakes to treat the Collateral Agent (in its capacity as such)
as entitled to exercise rights that comprise (and entitled to the benefits of) such financial assets, and entitled to exercise the rights of an entitlement holder in the manner contemplated by the
California UCC; 

14

 

        (d)   hereby
represents that, subject to applicable law, it has not granted, and covenants that so long as it acts as a securities intermediary hereunder it shall not grant,
control (including without limitation, securities control) over or with respect to any Collateral credited to any Collateral Account from time to time to any other Person other than the Collateral
Agent (in its capacity as such); 

        (e)   covenants
that it shall not, subject to applicable law, knowingly take any action inconsistent with, and represents and covenants that it is not and so long as this
Pledge Agreement remains in effect will not knowingly become, party to any agreement the terms of which are inconsistent with, the provisions of this Pledge Agreement; 

        (f)    agrees
that any item of property credited to the Collateral Account shall be treated as a financial asset; 

        (g)   agrees
that any item of Collateral credited to the Collateral Account shall not be subject to any security interest, lien or right of set-off in favor of it
as securities intermediary, except as may be expressly permitted under the Indenture and this Pledge Agreement; 

        (h)   agrees
to maintain the Collateral Account and maintain appropriate books and records in respect thereof in accordance with its usual procedures and subject to the terms
of this Pledge Agreement; 

        (i)    agrees
that, with respect to any Collateral that constitutes a security entitlement, it shall comply with the provisions of Section 3(c)(i) or
(ii) of this Pledge Agreement and, with respect to any Collateral that constitutes a securities account, it shall comply with any entitlement orders given by the Collateral Agent; and 

        (j)    agrees
that if its jurisdiction as securities intermediary shall change from that jurisdiction specified in Section 17, it will promptly notify the Collateral
Agent and the Trustee of such change and of such new jurisdiction. 

        SECTION
17.    Collateral Agent's Jurisdiction as Securities Intermediary.    The parties hereby agree that the
Collateral Agent's jurisdiction as securities intermediary for purposes of Section 8110(e) of the California UCC and Section 357.11 of the Treasury Regulations or the corresponding U.S.
federal regulations as they pertain to this Pledge Agreement, the Collateral Account and the security entitlements relating thereto, shall be the State of California. 

        SECTION
18.    Miscellaneous Provisions.    

        18.1    Notices.    Any notice, approval, direction, consent or other communication shall be sufficiently given if in
writing and delivered in person or mailed by first class mail, commercial courier service or telecopier communication, addressed as follows: 

if
to the Pledgor: 

Adaptec, Inc.

691 South Milpitas Blvd.

Milpitas, CA 95035

Attention: General Counsel and Assistant Corporate Secretary

Telecopier No.: (408) 262-2533 

if
to the Collateral Agent: 

Wells
Fargo Bank, N.A.

707 Wilshire Blvd., 17th Floor

Los Angeles, CA 90017

15

 

Attention:
Corporate Trust Department

Telecopier No.: (213) 614-3355 

if
to the Trustee: 

Wells
Fargo Bank, N.A.

707 Wilshire Blvd., 17th Floor

Los Angeles, CA 90017

Attention: Corporate Trust Department

Telecopier No.: (213) 614-3355 

or,
as to any such party, at such other address as shall be designated by such party in a written notice to each other party complying as to delivery with the terms of this Section. All such notices
and other communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; three Business Days after being deposited in the mail, postage prepaid, if
mailed; when receipt is confirmed, if telecopied; and on the next Business Day if timely delivered to an air courier guaranteeing overnight delivery. 

        18.2    No Adverse Interpretation of Other Agreements.    This Pledge Agreement may not be used to interpret another
pledge, security or debt agreement of the Pledgor or any subsidiary thereof. No such pledge, security or debt agreement (other than the Indenture) may be used to interpret this Pledge Agreement. 

        18.3    Severability.    The provisions of this Pledge Agreement are severable, and if any clause or provision shall
be held invalid, illegal or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect in that jurisdiction only such clause or provision, or part
thereof, and shall not in any manner affect such clause or provision in any other jurisdiction or any other clause or provision of this Pledge Agreement in any jurisdiction. 

        18.4    Headings.    The headings in this Pledge Agreement have been inserted for convenience of reference only, are
not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof. 

        18.5    Counterpart Originals.    This Pledge Agreement may be signed in two or more counterparts, each of which shall
be deemed an original, but all of which shall together constitute one and the same agreement. 

        18.6    Benefits of Pledge Agreement.    Nothing in this Pledge Agreement, express or implied, shall give to any
Person, other than the parties hereto and their successors hereunder, and the Holders, any benefit or any legal or equitable right, remedy or claim under this Pledge Agreement. 

        18.7    Amendments, Waivers and Consents.    Any amendment or waiver of any provision of this Pledge Agreement and any
consent to any departure by the Pledgor, the Trustee or the Collateral Agent or from any provision of this Pledge Agreement shall be effective only if made or duly given in compliance with all of the
terms and provisions of the Indenture, and none of the Trustee, the Collateral Agent, the Pledgor, or any Holder shall be deemed, by any act, delay, indulgence, omission or otherwise, to have waived
any right or remedy hereunder or to have acquiesced in any default or Event of Default or in any breach of any of the terms and conditions hereof. Failure of the Trustee, the Pledgor, the Collateral
Agent or any Holder to exercise, or delay in exercising, any right, power or privilege hereunder shall not preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Trustee, the Pledgor, the Collateral Agent or any Holder of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy that the
Trustee, the Pledgor, the Collateral Agent or such Holder would otherwise have on any future occasion. The Collateral Agent and the Trustee shall sign any amendment hereof authorized or permitted
pursuant to Section 12.3 of the Indenture if the amendment does not adversely affect the 

16

 

rights,
duties, liabilities or immunities of the Collateral Agent and the Trustee. If it does, the Collateral Agent and the Trustee may, in their sole discretion, but need not, sign it. In signing or
refusing to sign such amendment, the Collateral Agent and the Trustee shall be entitled to receive and, subject to Section 11 and 18.12, shall be fully protected in relying upon, an Opinion of
Counsel (as defined in the Indenture) stating that such amendment is authorized or permitted by the Indenture. The rights and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any rights or remedies provided by law. 

        18.8    [RESERVED]    

        18.9    Continuing Security Interest; Termination.    

        (a)   This
Pledge Agreement shall create a continuing first priority perfected security interest in and to the Collateral and shall, unless otherwise provided in the Indenture
or in this Pledge Agreement, remain in full force and effect until the Termination Date. This Pledge Agreement shall be binding upon the parties hereto and their respective transferees, successors and
assigns, and shall inure, together with the rights and remedies of the Trustee and the Collateral Agent hereunder, to the benefit of the Trustee, the Collateral Agent, the Pledgor, the Holders and
their respective successors, transferees and assigns. 

        (b)   Upon
the Termination Date, the pledge, assignment and security interest granted hereby shall terminate and all rights to the Collateral shall revert to the Pledgor. At
such time, the Collateral Agent shall, in accordance with the Pledgor's instructions, promptly reassign and redeliver to the Pledgor all of the Collateral hereunder that has not been sold, disposed
of, retained or applied by the Collateral Agent in accordance with the terms of this Pledge Agreement and the Indenture and execute and deliver to the Pledgor such documents as the Pledgor shall
reasonably request to evidence such termination. Such reassignment and redelivery shall be without warranty by or recourse to the Collateral Agent or the Trustee in its capacity as such, except as to
the absence of any liens on the Collateral created by or arising through the Collateral Agent or the Trustee, and shall be at the reasonable expense of the Pledgor. 

        18.10    Survival Provisions.    All representations, warranties and covenants contained herein shall survive the
execution and delivery of this Pledge Agreement, and shall terminate only upon the termination of this Pledge Agreement. The obligations of the Pledgor under Sections 12 and 14 hereof and the
obligations of the Collateral Agent under Section 18.9(b) hereof shall survive the termination of this Pledge Agreement. 

        18.11    Waivers.    The Pledgor waives presentment and demand for payment of any of the Obligations, protest and
notice of dishonor or default with respect to any of the Obligations, and all other notices to which the Pledgor might otherwise be entitled, except as otherwise expressly provided herein or in the
Indenture. 

        18.12    Authority of the Collateral Agent.    

        (a)   The
Collateral Agent shall have and be entitled to exercise all powers hereunder that are specifically granted to the Collateral Agent by the terms hereof, together with
such powers as are reasonably incident thereto. The Collateral Agent may perform any of its duties hereunder or in connection with the Collateral by or through agents or attorneys, shall not be
responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder and shall be entitled to retain counsel and to act in reliance upon the advice
of counsel concerning all such matters. Except as otherwise expressly provided in this Pledge Agreement or the Indenture, neither the Collateral Agent nor any director, officer, employee, attorney or
agent of the Collateral Agent shall be liable to the Pledgor for any action taken or omitted to be taken by the Collateral Agent, in its capacity as Collateral Agent, hereunder, except for its own bad
faith, gross negligence or willful misconduct, and the Collateral Agent shall not be responsible for the 

17

 

validity,
effectiveness or sufficiency hereof or of any document or security furnished pursuant hereto. The Collateral Agent and its directors, officers, employees, attorneys and agents shall be
entitled to rely conclusively on any communication, instrument or document believed by it or them to be genuine and correct and to have been signed or sent by the proper Person or Persons. The
Collateral Agent shall have no duty to cause any financing statement or continuation statement to be filed in respect of the Collateral. 

        (b)   The
Pledgor acknowledges that the rights and responsibilities of the Collateral Agent under this Pledge Agreement with respect to any action taken by the Collateral
Agent or the exercise or non-exercise by the Collateral Agent of any option, right, request, judgment or other right or remedy provided for herein or resulting or arising out of this
Pledge Agreement shall, as between the Collateral Agent and the Holders, be governed by the Indenture and by such other agreements with respect thereto as may exist from time to time among them, but,
as between the Collateral Agent and the Pledgor, the Collateral Agent shall be conclusively presumed to be acting as agent for the Trustee and the Holders with full and valid authority so to act or
refrain from acting, and the Pledgor shall not be obligated or entitled to make any inquiry respecting such authority. 

        18.13    Final Expression.    This Pledge Agreement, together with the Indenture and any other agreement executed
among the parties to this Agreement in connection herewith, is intended by the parties as a final expression of this Pledge Agreement and is intended as a complete and exclusive statement of the terms
and conditions thereof. 

        18.14    Rights of Holders.    No Holder shall have any independent rights hereunder other than those rights granted
to individual Holders pursuant to Sections 8.5, 8.6 and 8.7 of the Indenture; provided that nothing in this subsection shall limit any rights granted to
the Trustee under the Notes or the Indenture. 

        18.15    GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; WAIVER OF DAMAGES.    

        (a)   THIS
PLEDGE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF
THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF CALIFORNIA, AND, ANY DISPUTE ARISING
OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THE PLEDGOR, THE TRUSTEE, THE COLLATERAL AGENT AND THE HOLDERS IN CONNECTION WITH THIS PLEDGE AGREEMENT, AND
WHETHER ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. NOTWITHSTANDING THE FOREGOING, THE MATTERS IDENTIFIED IN 31 C.F.R.
SECTIONS 357.10 AND 357.11 (AS IN EFFECT ON THE DATE OF THIS PLEDGE AGREEMENT) SHALL BE GOVERNED SOLELY BY THE LAWS SPECIFIED THEREIN AND THE MATTERS IDENTIFIED IN SECTION 9305(a)(3) OF THE CALIFORNIA
UCC WILL BE GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA. 

        (b)   THE
PLEDGOR HEREBY WAIVES PERSONAL SERVICE OF PROCESS IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS PLEDGE AGREEMENT AND FOR ACTIONS BROUGHT UNDER THE U.S.
FEDERAL OR STATE SECURITIES LAWS BROUGHT IN ANY FEDERAL OR STATE COURT LOCATED IN THE CITY OF SAN FRANCISCO (EACH A "CALIFORNIA COURT") AND CONSENTS THAT ALL SERVICE OF PROCESS IN ANY SUCH SUIT,
ACTION OR PROCEEDING SHALL BE MADE BY 

18

 

REGISTERED
MAIL, RETURN RECEIPT REQUESTED, DIRECTED TO THE PLEDGOR AT THE ADDRESS INDICATED IN SECTION 18.1. EACH OF THE PARTIES HERETO SUBMITS TO THE JURISDICTION OF ANY CALIFORNIA COURT AND TO THE
COURTS OF ITS CORPORATE DOMICILE WITH RESPECT TO ANY ACTIONS BROUGHT AGAINST IT AS DEFENDANT IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THE PLEDGOR, THE TRUSTEE, THE COLLATERAL AGENT AND THE HOLDERS IN CONNECTION WITH THIS PLEDGE AGREEMENT, AND EACH OF THE PARTIES HERETO WAIVES ANY OBJECTION THAT IT MAY
HAVE TO THE LAYING OF VENUE, INCLUDING ANY PLEADING OF FORUM NON CONVENIENS, WITH RESPECT TO ANY SUCH ACTION AND WAIVES ANY RIGHT TO WHICH IT MAY BE ENTITLED ON ACCOUNT OF PLACE OF RESIDENCE OR
DOMICILE. 

        (c)   THE
PLEDGOR AGREES THAT THE TRUSTEE SHALL, IN ITS CAPACITY AS TRUSTEE OR IN THE NAME AND ON BEHALF OF ANY HOLDER, HAVE THE RIGHT, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, TO PROCEED AGAINST THE PLEDGOR OR THE COLLATERAL IN A COURT IN ANY LOCATION REASONABLY SELECTED IN GOOD FAITH (AND HAVING PERSONAL OR IN REM JURISDICTION OVER THE PLEDGOR OR THE COLLATERAL, AS
THE CASE MAY BE) TO ENABLE THE TRUSTEE TO REALIZE ON SUCH COLLATERAL, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF THE TRUSTEE. THE PLEDGOR AGREES THAT IT WILL NOT ASSERT ANY
COUNTERCLAIMS, SETOFFS OR CROSSCLAIMS IN ANY PROCEEDING
BROUGHT BY THE TRUSTEE TO REALIZE ON SUCH PROPERTY OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE TRUSTEE, EXCEPT FOR SUCH COUNTERCLAIMS, SETOFFS OR CROSSCLAIMS WHICH, IF NOT ASSERTED
IN ANY SUCH PROCEEDING, COULD NOT OTHERWISE BE BROUGHT OR ASSERTED. 

        (d)   THE
PLEDGOR AGREES THAT NEITHER ANY HOLDER NOR (EXCEPT AS OTHERWISE PROVIDED IN THIS PLEDGE AGREEMENT OR THE INDENTURE) THE COLLATERAL AGENT IN ITS CAPACITY AS
COLLATERAL AGENT SHALL HAVE ANY LIABILITY TO THE PLEDGOR (WHETHER ARISING IN TORT, CONTRACT OR OTHERWISE) FOR LOSSES SUFFERED BY THE PLEDGOR IN CONNECTION WITH, ARISING OUT OF, OR IN ANY WAY RELATED
TO, THE TRANSACTIONS CONTEMPLATED AND THE RELATIONSHIP ESTABLISHED BY THIS PLEDGE AGREEMENT, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH, UNLESS IT IS DETERMINED BY A FINAL AND
NONAPPEALABLE JUDGMENT OF A COURT THAT IS BINDING ON THE TRUSTEE OR SUCH HOLDER, AS THE CASE MAY BE, THAT SUCH LOSSES WERE THE RESULT OF ACTS OR OMISSIONS ON THE PART OF THE COLLATERAL AGENT OR SUCH
HOLDERS, AS THE CASE MAY BE, CONSTITUTING BAD FAITH, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. 

        (e)   TO
THE EXTENT PERMITTED BY APPLICABLE LAW, THE PLEDGOR WAIVES THE POSTING OF ANY BOND OTHERWISE REQUIRED OF THE TRUSTEE, THE COLLATERAL AGENT OR ANY HOLDER IN CONNECTION
WITH ANY JUDICIAL PROCESS OR PROCEEDING TO ENFORCE ANY JUDGMENT OR OTHER COURT ORDER PERTAINING TO THIS PLEDGE AGREEMENT OR ANY RELATED AGREEMENT OR DOCUMENT ENTERED IN FAVOR OF THE TRUSTEE, THE
COLLATERAL AGENT OR ANY HOLDER, OR TO ENFORCE BY SPECIFIC PERFORMANCE, TEMPORARY RESTRAINING ORDER OR PRELIMINARY OR 

19

 

PERMANENT
INJUNCTION, THIS PLEDGE AGREEMENT OR ANY RELATED AGREEMENT OR DOCUMENT BETWEEN THE PLEDGOR, ON THE ONE HAND, AND THE TRUSTEE, THE COLLATERAL AGENT AND/OR THE HOLDERS, ON THE OTHER HAND. 

        18.16    Effectiveness.    This Pledge Agreement shall become effective upon the effectiveness of the Indenture. 

20

 

        IN
WITNESS WHEREOF, the Pledgor, the Trustee and the Collateral Agent have each caused this Pledge Agreement to be duly executed and delivered as of the date first above written. 

	 	 	Pledgor:
	

 	
 	
ADAPTEC, INC.
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

Trustee:
	

 	
 	
WELLS FARGO BANK, N.A.,

  as Trustee
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

Collateral Agent:
	

 	
 	
WELLS FARGO BANK, N.A.,

  as Collateral Agent
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:

21

 
 

SCHEDULE I    
    

PART I

PLEDGED SECURITIES  

	Description of

Debt
 
	 	CUSIP No(s).
	 	Final Maturity
	 	Original

Principal

Amount
	 	Cost at Closing

Time

	U.S. Treasury Principal Strip	 	912820BJ5	 	5/15/2004	 	$	844,000.00	 	$	840,784.36
	

U.S. Treasury Principal Strip	
 	

912803AB9	
 	

11/15/2004	
 	
$	

844,000.00	
 	
$	

835,045.16
	

U.S. Treasury Principal Strip	
 	

912833FW5	
 	

5/15/2005	
 	
$	

844,000.00	
 	
$	

828,293.16
	

U.S. Treasury Principal Strip	
 	

912820BQ9	
 	

11/15/2005	
 	
$	

844,000.00	
 	
$	

817,194.56
	

U.S. Treasury Principal Strip	
 	

912833FY1	
 	

5/15/2006	
 	
$	

844,000.00	
 	
$	

804,534.56
	

U.S. Treasury Principal Strip	
 	

912833FZ8	
 	

11/15/2006	
 	
$	

844,000.00	
 	
$	

790,633.88
	

U.S. Treasury Principal Strip	
 	

912833GA2	
 	

5/15/2007	
 	
$	

844,000.00	
 	
$	

774,462.84
	

U.S. Treasury Principal Strip	
 	

912833GB0	
 	

11/15/2007	
 	
$	

844,000.00	
 	
$	

759,751.92
	

U.S. Treasury Principal Strip	
 	

912833GC8	
 	

5/15/2008	
 	
$	

844,000.00	
 	
$	

740,213.32
	

U.S. Treasury Principal Strip	
 	

912833GD6	
 	

11/15/2008	
 	
$	

844,000.00	
 	
$	

723,654.04

PART II

SECURITIES ENTITLEMENTS  

	Issuer of

Financial Asset
	 	Description of

Financial Asset
	 	Securities Intermediary

(Name and Address)
	 	Securities Account

(Number and Location)

	U.S. Government	 	912820BJ5	 	Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	 	Account No. 15404001
	

U.S. Government	
 	

912803AB9	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833FW5	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912820BQ9	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833FY1	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833FZ8	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833GA2	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833GB0	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833GC8	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001
	

U.S. Government	
 	

912833GD6	
 	

Wells Fargo Bank, N.A.

707 Wilshire Blvd.

17th Floor

Los Angeles, CA 90017	
 	

Account No. 15404001

EXHIBIT A  

 
 

Wells Fargo Bank, N.A.    
    
    Officer's Certificate    
    

        Pursuant to Section 3(e) of the Collateral Pledge and Security Agreement (as supplemented from time to time, the "Pledge Agreement") dated as of
December 22, 2003, among Adaptec, Inc., a Delaware corporation (the "Pledgor"), Wells Fargo Bank, N.A., as trustee (the "Trustee") for the holders of the $225,000,000 aggregate principal
amount 3/4% Convertible Subordinated Notes Due 2023 of the Pledgor and Wells Fargo Bank, N.A., as collateral agent and securities intermediary (the "Collateral Agent"), the undersigned
officer of the Collateral Agent, on behalf of the Collateral Agent, makes the following certifications to the Pledgor and the Initial Purchasers. Capitalized terms used and not defined in this
Officer's Certificate have the meanings set forth or referred to in the Pledge Agreement. 

        1.     Substantially
contemporaneously with the execution and delivery of this Officer's Certificate, the Collateral Agent has acquired its security entitlement to the Initial
Pledged Securities or through a "securities account" (as defined in Section 8501(a) of the California UCC) maintained by the Collateral Agent, for value and without notice of any adverse claim
thereto. Without limiting the generality of the foregoing, the Collateral Account, the Pledged Securities and the other Collateral are not, and the Collateral Agent's security entitlement to the
Collateral is not, to the actual knowledge of the corporate trust officer having responsibility for the administration of the Pledge Agreement on behalf of the Collateral Agent, subject to any lien
granted by or to or arising through or in favor of any securities intermediary (including, without limitation, Wells Fargo Bank, N.A. or the Federal Reserve Bank) through which the Collateral Agent
derives its security entitlement to the Collateral. 

        2.     The
Collateral Agent has not knowingly caused or permitted the Collateral Account or its security entitlement thereto to become subject to any lien created by or arising
through the Collateral Agent. 

        IN
WITNESS WHEREOF, the undersigned officer has executed this Officer's Certificate on behalf of Wells Fargo Bank, N.A., as Collateral Agent this 22nd day of December, 2003. 

	 	 	WELLS FARGO BANK, N.A.,

    as Collateral Agent
	 	 	 	 
	 	 	 	 
	 	 	By:	 
	 	 	 	
 Name:

Title:    Authorized Signatory

EXHIBIT B  

 
 

[Form of Supplement to the Pledge Agreement]    

        SUPPLEMENT
NO.     dated as of                        , 200[    ], to the COLLATERAL PLEDGE AND
SECURITY AGREEMENT dated as of
December [    ], 2003 (as supplemented from time to time, the "Pledge Agreement") among Adaptec, Inc., a Delaware corporation (the "Pledgor"), Wells
Fargo Bank, N.A., as trustee (in such capacity, the "Trustee") for the holders (the "Holders") of the Notes issued by the Pledgor under the Indenture referred to below, and Wells Fargo Bank, N.A., a
California state chartered banking corporation, as collateral agent and securities intermediary (in such capacity, the "Collateral Agent"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Pledge Agreement. 

        WHEREAS,
the Pledgor Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), are parties to a Purchase Agreement dated
December [    ], 2003 (the "Purchase Agreement"), pursuant to which the Pledgor granted Merrill Lynch and Banc of America Securities, LLC ("the Initial
Purchasers") an overallotment option to purchase up to $25,000,000 aggregate principal amount of the Pledgor's 3/4% Convertible Subordinated Notes due 2023 (the "Notes"); 

        WHEREAS,
the Pledgor and the Trustee have entered into that certain indenture dated as of December [    ], 2003 (as amended, restated,
supplemented or otherwise modified from time to time, the "Indenture"), pursuant to which the Issuers are issuing the Notes on the date hereof; 

        WHEREAS,
pursuant to the Indenture, the Pledgor is required to purchase, or cause the purchase of, and pledge to the Collateral Agent for the benefit of the Trustee and the Holders, on
the relevant Date of Delivery (as defined in the Purchase Agreement), Pledged Securities in an amount that will be sufficient upon receipt of scheduled interest and principal payments of such
securities, according to the written report PricewaterhouseCoopers LLP or another nationally recognized firm of independent public accountants selected by the Pledgor and delivered to the Trustee, to
provide for payment in full of the first ten scheduled interest payments due on the Notes; 

        WHEREAS,
the Pledgor, the Trustee and the Collateral Agent have entered into the Pledge Agreement, pursuant to which the Pledgor has previously pledged certain Pledged Securities to the
Collateral Agent for the benefit of the Holders in connection with the purchase by the Initial Purchasers of $200,000,000 aggregate principal amount of Notes plus an additional $25,000,000 aggregate
principal amount of Notes as to which the Initial Purchasers have exercised their over-allotment option set forth in Section 2(b) of the Purchase Agreement; 

        WHEREAS,
the Initial Purchasers have exercised their overallotment option under the Purchase Agreement to purchase $[            ] aggregate principal amount
of Notes; 

        WHEREAS,
it is a condition precedent to the purchase of the Notes by the Initial Purchasers pursuant to the overallotment option granted in the Purchase Agreement that the Pledgor
purchase Additional Pledged Securities and deposit such Additional Pledged Securities into the Collateral Account to be held therein subject to the terms of the Pledge Agreement and shall have granted
the assignment and security interest and made the pledge and assignment contemplated by the Pledge Agreement; 

        NOW,
THEREFORE, in consideration of the premises herein contained, and in order to induce the Initial Purchasers to purchase the Notes, the Pledgor, the Trustee and the Collateral Agent
hereby agree, for the benefit of the Initial Purchasers and for the ratable benefit of the Holders, as follows: 

        SECTION
1.    Pledge and Grant of Security Interest.    Pursuant to Section 1.3 of the Pledge Agreement, as
security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations, the Pledgor hereby assigns and pledges to the
Collateral Agent for the benefit of the Trustee and the ratable benefit of the Holders and hereby grants to the Collateral Agent for the benefit of the Trustee and for the ratable benefit of 

the
Holders, a lien on and security interest in all of the Pledgor's right, title and interest in, to and under the following property: (a) the U.S. Government Obligations identified by CUSIP
No. in Part I of Schedule I hereto (the "Additional Pledged Securities") and the certificates representing the Additional Pledged Securities, the scheduled payments of principal and
interest thereon which will be sufficient to provide for payment in full of the first ten scheduled interest payments due on the Notes issued in connection herewith and (b) the security
entitlements described in Part II of Schedule I hereto, with respect to the financial assets described, the securities intermediary named, and the securities account referred to therein.
The Pledge Agreement is hereby incorporated herein by reference. 

        SECTION
2.    Supplement to Schedule I.    The parties hereto agree that Schedule I to the Pledge
Agreement shall be supplemented by Schedule I hereto. 

        SECTION
3.    Purchase of Additional Pledged Securities.    Pursuant to Section 2(b)(ii) of the Pledge
Agreement, as of the date hereof, the Pledgor agrees to transfer, or caused to be transferred, an amount equal to $
[                        ], which amount shall be sufficient for the
Collateral Agent to purchase the Additional Pledged Securities, by depositing such funds into the Collateral Account. The Collateral Agent agrees to apply such amount to purchase the Additional
Pledged Securities as contemplated under Section 2(c) of the Pledge Agreement. 

        SECTION
4.    Representations and Warranties of the Pledgor.    The Pledgor hereby represents and warrants to the
Trustee and the Collateral Agent that: 

	(a)
	Each
of this Supplement and the Pledge Agreement as supplemented hereby has been duly authorized, validly executed and delivered by the Pledgor and (assuming the due authorization and
valid execution and delivery of this Supplement by each of the Trustee and the Collateral Agent) constitutes a valid and binding agreement of the Pledgor, enforceable against the Pledgor in accordance
with its terms, except as (i) the enforceability hereof and thereof may be limited by bankruptcy, insolvency, fraudulent conveyance, preference, reorganization, moratorium or similar laws now
or hereafter in effect relating to or affecting the rights or remedies of creditors generally, (ii) the availability of equitable remedies may be limited by equitable principles of general
applicability and the discretion of the court before which any proceeding therefor may be brought, (iii) the exculpation provisions and rights to indemnification under the Pledge Agreement may
be limited by U.S. federal and state securities laws and public policy considerations and (iv) the waiver of rights and defenses contained in Section 13(b), Section 18.11 and
Section 18.15 of the Pledge Agreement may be limited by applicable law and

	(b)
	the
representations and warranties of the Pledgor set forth in Section 7 of the Pledge Agreement are true and correct in all material respects with the same effect as if made
on and as of the date hereof. 

        SECTION
5.    Execution in Counterparts.    This Supplement may be signed in two or more counterparts, each of which
shall be deemed an original, but all of which shall together constitute one and the same agreement. This Supplement shall become effective when the Collateral Agent shall have received counterparts of
this Supplement that, when taken together, bear the signatures of the Pledgor, the Trustee and the Collateral Agent. 

        SECTION
6.    Effect of Supplement.    Except as expressly supplemented hereby, the Pledge Agreement shall remain in
full force and effect. 

        SECTION
7.    Governing Law.    This Supplement shall governed by and construed in accordance with the laws of the
State of California. 

        IN
WITNESS WHEREOF, the Pledgor, the Trustee and the Collateral Agent have each caused this Supplement to be duly executed and delivered as of the date first above written. 

	 	 	Pledgor:
	 	 	 	 
	 	 	ADAPTEC, INC.
	 	 	 	 
	 	 	 	 
	 	 	By:	 
	 	 	 	
 Name:

Title:
	 	 	 	 
	 	 	 	 
	 	 	Trustee:
	 	 	 	 
	 	 	WELLS FARGO BANK, N.A.,

    as Trustee
	 	 	 	 
	 	 	 	 
	 	 	By:	 
	 	 	 	
 Name:

Title:
	 	 	 	 
	 	 	 	 
	 	 	Collateral Agent:
	 	 	 	 
	 	 	WELLS FARGO BANK, N.A.,

    as Collateral Agent
	 	 	 	 
	 	 	 	 
	 	 	By:	 
	 	 	 	
 Name:

Title:

  

 
 

SCHEDULE I TO
  SUPPLEMENT NO.    TO
  PLEDGE AGREEMENT    
    

PART I

PLEDGED SECURITIES  

	Description of

Debt
	 	CUSIP No(s).
	 	Final Maturity
	 	Original

Principal

Amount
	 	Cost at Date of

Delivery

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 

PART II

SECURITIES ENTITLEMENTS  

	Issuer of

Financial Asset
	 	Description of

Financial Asset
	 	Securities Intermediary

(Name and Address)
	 	Securities Account

(Number and Location)

	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

B-I-1

 
 
 

Wells Fargo Bank, N.A.    
    
    Officer's Certificate    
    

        Pursuant to Section 3(e) of the Collateral Pledge and Security Agreement (as supplemented from time to time, the "Pledge Agreement") dated as of
December [    ], 2003, among Adaptec, Inc., a Delaware corporation (the "Pledgor"), Wells Fargo Bank, N.A., as trustee (the "Trustee") for the holders
of up to $225,000,000 aggregate principal amount of 3/4% Convertible Subordinated Notes Due 2023 of the Pledgor and Wells Fargo Bank, N.A., as collateral agent and securities
intermediary (the "Collateral Agent"), the undersigned officer of the Collateral Agent, on
behalf of the Collateral Agent, makes the following certifications to the Pledgor and the Initial Purchasers. Capitalized terms used and not defined in this Officer's Certificate have the meanings set
forth or referred to in the Pledge Agreement. 

        1.     Substantially
contemporaneously with the execution and delivery of this Officer's Certificate, the Collateral Agent has acquired its security entitlement to the Initial
Pledged Securities or through a "securities account" (as defined in Section 8501(a) of the California UCC) maintained by the Collateral Agent, for value and without notice of any adverse claim
thereto. Without limiting the generality of the foregoing, the Collateral Account, the Pledged Securities and the other Collateral are not, and the Collateral Agent's security entitlement to the
Collateral is not, to the actual knowledge of the corporate trust officer having responsibility for the administration of the Pledge Agreement on behalf of the Collateral Agent, subject to any lien
granted by or to or arising through or in favor of any securities intermediary (including, without limitation, Wells Fargo Bank, N.A. or the Federal Reserve Bank) through which the Collateral Agent
derives its security entitlement to the Collateral. 

        2.     The
Collateral Agent has not knowingly caused or permitted the Collateral Account or its security entitlement thereto to become subject to any lien created by or arising
through the Collateral Agent. 

B-I-2

 

        IN
WITNESS WHEREOF, the undersigned officer has executed this Officer's Certificate on behalf of Wells Fargo Bank, N.A., as Collateral Agent this
[            ] day of [            ], 200[            ]. 

	 	 	WELLS FARGO BANK, N.A.,

    as Collateral Agent
	 	 	 	 
	 	 	 	 
	 	 	By:	 
	 	 	 	
 Name:

Title:  Authorized Signatory

B-I-3

QuickLinks

Exhibit 4.04

SCHEDULE I

Wells Fargo Bank, N.A. Officer's Certificate

[Form of Supplement to the Pledge Agreement]

SCHEDULE I TO SUPPLEMENT NO. TO PLEDGE AGREEMENT

Wells Fargo Bank, N.A. Officer's Certificate

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