Registration Rights Agreement

AMATI COMMUNICATIONS CORPORATION


REGISTRATION RIGHTS AGREEMENT


REGISTRATION RIGHTS AGREEMENT, dated as of October 3, 1996, among the investors listed on the signature pages hereto (the "Investors") and Amati Communications Corporation, a Delaware corporation (the "Company").


R E C I T A L S


WHEREAS, the Investors have, pursuant to the terms of the Investment Agreement, dated as of the date hereof, by and among the Company and the Investors (the "Agreement"), agreed to purchase shares of Common Stock, par value $0.20 per share, of the Company (the "Common Stock") and Warrants to purchase shares of Common Stock; and


WHEREAS, the Company has agreed, as a condition precedent to the Investors' obligations under the Agreement, to grant the Investors certain registration rights; and


WHEREAS, the Company and the Investors desire to define the registration rights of the Investors on the terms and subject to the conditions set forth herein and in Section 1.6 of the Agreement.


NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the parties hereby agree as follows:


1. DEFINITIONS


As used in this Agreement, the following terms have the respective meaning set forth below:


Commission: shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act;


Exchange Act: shall mean the Securities Exchange Act of 1934, as amended;


Holder: shall mean any holder of Registrable Securities;


Initiating Holder: shall mean any Holder or Holders who in the aggregate are Holders of more than 50% of the then outstanding Registrable Securities;


Person: shall mean an individual, partnership, joint-stock company, corporation, trust or unincorporated organization, and a government or agency or political subdivision thereof;


register, registered and registration: shall mean to a registration effected by preparing and filing a registration statement in compliance with the Securities Act (and any post-effective amendments filed or required to be filed) and the declaration or ordering of effectiveness of such registration statement;


Registrable Securities: shall mean (A) shares of Common Stock issued or issuable under the Agreement, (B) any additional shares of Common Stock acquired by the Investors pursuant to the Warrants and (C) any stock of the Company issued as a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares of Common Stock referred to in clause (A) or (B);


Registration Expenses: shall mean all expenses incurred by the Company in compliance with Sections 2(a) and (b) hereof, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel for the Company, fees and expenses of one counsel for all the Holders, blue sky fees and expenses and the expense of any special audits incident to or required by any such registration (but excluding the compensation of regular employees of the Company, which shall be paid in any event by the Company);


Security, Securities: shall have the meaning set forth in Section 2(1) of the Securities Act;


Securities Act: shall mean the Securities Act of 1933, as amended; and


Selling Expenses: shall mean all underwriting discounts and selling commissions applicable to the sale of Registrable Securities.


2. REGISTRATION RIGHTS


(a) Requested Registration.


(i) Request for Registration. If the Company shall receive from
an Initiating Holder, at any time following the time that the shelf
registration statements filed by the Company pursuant to Section 1.6
under the Agreement (a "Shelf Registration Statement") are no longer
in effect with respect to all of the Registrable Securities, a written
request that the Company effect any registration covering the
registration of 20% or more of the Registrable Securities (or such
lesser percent which (I) the Company then owns or (II) results in an
anticipated aggregate offering price of $1,000,000 or more), the
Company will:


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(A) promptly give written notice of the proposed
registration, qualification or compliance to all other Holders;
and


(B) as soon as practicable, use its diligent best efforts to
effect such registration (including, without limitation, the
execution of an undertaking to file post-effective amendments,
appropriate qualification under applicable blue sky or other
state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act) as may be so
requested and as would permit or facilitate the sale and
distribution of all or such portion of such Registrable
Securities as are specified in such request, together with all or
such portion of the Registrable Securities of any Holder or
Holders joining in such request as are specified in a written
request received by the Company within 10 business days after
written notice from the Company is given under Section 2(a)(i)(A)
above; provided that the Company shall not be obligated to
effect, or take any action to effect, any such registration
pursuant to this Section 2(a):


(x) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of
process in effecting such registration, qualification or
compliance, unless the Company is already subject to service
in such jurisdiction and except as may be required by the
Securities Act or applicable rules or regulations
thereunder; or


(y) After the Company has effected three (3) such
registrations pursuant to this Section 2(a) and such
registrations have been declared or ordered effective and
the Company has satisfied its obligations under Section 2(d)
hereof.


The registration statement filed pursuant to the request of the Initiating Holders may not include other securities of the Company which are held by Persons other than the Holders ("Other Stockholders"), without the prior consent of Holders registering at least 50% of the Registrable Securities.


(ii) Underwriting. If the Initiating Holder intends to distribute
the Registrable Securities covered by its request by means of an
underwriting, it shall so advise the Company as a part of its request
made pursuant to this Section 2(a), and the Company shall include such
information in the written notice referred to in Section 2(a)(i)(A).
In such event, the right of any Holder to include its Registrable
Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such
Holder's Registrable Securities in the underwriting to the extent
provided


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herein. All Holders proposing to distribute their securities
through such underwriting shall enter into an underwriting agreement
in customary form with the underwriter or underwriters selected for
such underwriting by a majority in interest of the Initiating Holder.


(iii) Company's Right to Defer. Notwithstanding the foregoing, if
the Company shall furnish to the Initiating Holder a certificate
signed by the President of the Company stating that, in the good faith
judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such
registration statement to be filed in the near future and it is
therefore essential to defer the filing of such registration
statement, the Company shall have the right to defer such filing for a
period of not more than 30 calendar days after receipt of the request
of the Initiating Holder (a "Suspension Period"); provided that no
Suspension Period may commence less than ninety (90) days after the
expiration of the then most recent Suspension Period, and the Company
may establish no more than two (2) Suspension Periods in any twelve
(12) consecutive months.


(iv) Transfer of Rights. The registration rights set forth in
this Section 2 may be transferred or assigned to a transferee or
assignee of any Registrable Securities not sold to the public
acquiring at least 10,000 shares of Registrable Securities, equitably
adjusted for any recapitalization, stock split, combination and the
like (hereinafter referred to in this Section 2 as the "Transferee");
provided, however, that:


(A) the Company must receive written notice prior to the
time of said transfer, stating the name and address of the
Transferee and identifying the securities with respect to which
such registration rights are being transferred or assigned, and


(B) the Transferee must not be a person deemed by the Board
of Directors of the Company, in good faith, to be a competitor or
potential competitor of the Company.


Notwithstanding the limitation set forth in the foregoing
sentence respecting the minimum number of shares which must be
transferred, any Holder which is a partnership or limited liability
company may transfer such Holder's registration rights to such
Holder's constituent partners or members without restriction as to the
number or percentage of shares acquired by any such constituent
partner or member.


(b) Company Registration.


(i) If the Company shall determine to register any of its equity
securities either for its own account or


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for the account of Other Stockholders, other than a registration
relating solely to employee benefit plans, or a registration relating
solely to a Commission Rule 145 transaction, or a registration on any
registration form which does not permit secondary sales or does not
include substantially the same information as would be required to be
included in a registration statement covering the sale of Registrable
Securities, the Company will:


(A) promptly give to each of the Holders a written notice
thereof (which shall include a list of the jurisdictions in which
the Company intends to attempt to qualify such securities under
the applicable blue sky or other state securities laws); an ...