<PAGE>
As filed with the Securities and Exchange Commission on April 12, 2000
Registration No. 333-_____________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------
INSIGNIA SOLUTIONS PLC
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<CAPTION>
<S> <C> <C>
ENGLAND AND WALES 7372 NOT APPLICABLE
(State or Other Jurisdiction (Primary Standard Industrial (I.R.S. Employer
of Incorporation or Organization) Classification Code Number) Identification No.)
---------------------------
41300 CHRISTY STREET THE MERCURY CENTRE, WYCOMBE LANE
FREMONT, CALIFORNIA 94538 WOOBURN GREEN
UNITED STATES OF AMERICA HIGH WYCOMBE, BUCKS HP10 0HH
(510) 360-3700 UNITED KINGDOM
(44) 1628-539500
</TABLE>
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
1995 INCENTIVE STOCK PLAN FOR U.S. EMPLOYEES
U.K. EMPLOYEE SHARE OPTION SCHEME 1996
1995 EMPLOYEE SHARE PURCHASE PLAN
(Full Title of the Plans)
STEPHEN M. AMBLER
SENIOR VICE PRESIDENT, FINANCE AND CHIEF FINANCIAL OFFICER
INSIGNIA SOLUTIONS PLC
41300 CHRISTY STREET
FREMONT, CALIFORNIA 94538
(510) 360-3700
(Name, Address and Telephone Number of Agent for Service)
---------------------------
COPIES TO:
CORINNA M. WONG, ESQ.
BAKER & MCKENZIE
660 HANSEN WAY
PALO ALTO, CALIFORNIA 94304
(650) 856-2400
---------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF SECURITIES TO BE AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
REGISTERED(1) REGISTERED(2) SHARE(4) PRICE (3) REGISTRATION FEE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ordinary Shares, 0.20 pounds par value 1,125,000 shares $14.625 $16,453,125.00 $4,343.63
represented by American Depositary
Shares (1)
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) A separate registration statement on Form F-6 (File No. 33-98228) is
effective with respect to the American Depositary Shares represented by American
Depositary Receipts issuable on a one-for-one basis with the Ordinary Shares
registered hereby upon deposit of such Ordinary Shares.
(2) The shares in the Calculation of Registration Fee Table, and which may be
offered pursuant to this Registration Statement, include, pursuant to Rule 416
of the Securities Act of 1933, as amended, such additional number of shares that
may become issuable as a result of any share split, share dividend or similar
event. In addition, pursuant to Rule 416(c) under the Securities Act, this
Registraton Statement also covers an indeterminate amount of interest to be
offered or sold pursuant to the employee benefit plan described herein.
(3) Estimated solely for the purpose of calculating the amount of the
registration fee, pursuant to Rule 457(h) and 457(c) under the Securities
Act, based upon the average of the high and low prices of the ADS on the
Nasdaq National Market on April 10, 2000.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE>
INSIGNIA SOLUTIONS PLC
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the year ended
December 31, 1999 filed pursuant to Section 13(a) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), which Annual Report contains audited financial
statements for the year ended December 31, 1999; and
(b) The description of the Registrant's Ordinary Shares contained
in the Registrant's Registration Statement on Form 8-A filed
under Section 12(g) of the Exchange Act, including any
amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities registered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed incorporated by reference herein and to be a part hereof from the date
of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS AND LIMITATION OF
LIABILITY.
The Registrant's Articles of Association contain a provision to the
effect that, so far as permitted by the statutory provisions of English law, the
directors and secretary shall be indemnified by the Registrant against
liabilities incurred by them in relation to the affairs of the Registrant.
However, the Companies Act 1985 renders any such indemnity ineffective to the
extent it applies to neglect or breach of duty in relation to the Registrant,
except to the extent that it covers costs incurred by the director or secretary
in respect of court proceedings in which judgment is given in his favor.
The Registrant's policy is to enter into indemnity agreements with each
of its directors and executive officers. In addition, Insignia Solutions, Inc.,
a Delaware corporation and a wholly owned subsidiary of the Registrant, enters
into indemnity agreements with each of the Registrant's directors and executive
officers. The indemnity agreements provide that directors and executive officers
will be indemnified and held harmless to the fullest possible extent permitted
by law including against all expenses (including attorneys' fees), judgments,
fines and settlement amounts paid or reasonably incurred by them in any action,
suit or proceeding, including any derivative action by or in the right of the
Registrant, on account of their services as directors, officers, employees or
agents of the Registrant or as directors, officers, employees or agents of any
other company or enterprise when they are serving in such capacities at the
request of the Registrant. Neither the Registrant nor Insignia Solutions, Inc.
will be obligated pursuant to the agreements to indemnify or advance expenses to
an indemnified party with respect to proceedings or claims (i) initiated by the
indemnified party and not by way of defense, except with respect to a proceeding
authorized by the Board of Directors and successful proceedings brought to
enforce a right to indemnification under the indemnity agreements; (ii) for any
amounts paid in settlement of a proceeding unless the Registrant consents to
such settlement; (iii) on account of any suit in which judgment is rendered
against the indemnified party for an accounting of profits made from the
purchase or sale by the indemnified party of securities of the Registrant
pursuant to the provisions of Section 16(b) of the Exchange Act and related
laws; (iv) on account of conduct by an indemnified party that is finally
adjudged to have been in bad faith or conduct that the indemnified party did not
reasonably believe to be in, or not opposed to, the best interests of the
Registrant; (v) on account of any criminal action or proceeding arising out of
conduct that the indemnified party had reasonable cause to believe was unlawful;
or (vi) if a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful.
II-1
<PAGE>
The indemnity agreements are not exclusive of any rights a director or
executive officer may have under the Articles of Association, other agreements,
any majority-in-interest vote of the shareholders or vote of disinterested
directors, applicable law or otherwise.
The indemnification provision in the Articles of Association, and the
indemnity agreements, may be sufficiently broad to permit indemnification of the
Registrant's directors and executive officers for liabilities arising under the
Securities Act of 1933, as amended (the "Securities Act"). In addition, the
Registrant has director and officer liability insurance.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
None.
ITEM 8. EXHIBITS.
4.01 Registration Rights Agreement, dated as of June 5, 1992, as
amended (incorporated herein by reference to Exhibit 4.02 of
the Registrant's Registration Statement on Form F-1 (File No.
33-98230) declared effective by the Commission on November 13,
1995).
4.02 Deposit Agreement between Registrant and The Bank of New York
(incorporated herein by reference to Exhibit 4.03 of the
Registrant's Annual Report on Form 10-K (File No. 0-27012) for
the year ended December 31, 1995 (the "1995 10-K").
4.03 Form of American Depositary Receipt (incorporated herein by
reference to Exhibit 4.04 of the 1995 10-K).
4.04 Registrant's 1995 Incentive Stock Option Plan for U.S.
Employees and related documents, as amended.*
4.05 Registrant's U.K. Employee Share Option Scheme 1996 and
related documents, as amended.*
4.06 Registrant's 1995 Employee Share Purchase Plan, as amended.*
5.01 Opinion of Macfarlanes.*
23.01 Consent of Macfarlanes (included in Exhibit 5.01).*
23.02 Consent of Independent Accountants.*
24.01 Power of Attorney (included on signature page).*
- ---------------------------
* filed herewith
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
II-2
<PAGE>
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) above do not
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or furnished to
the Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions discussed in Item 6 hereof, or otherwise,
the Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Santa Clara, State of California, on April 12, 2000.
INSIGNIA SOLUTIONS plc
/s/ RICHARD M. NOLING
--------------------------------------
By: Richard M. Noling
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each individual whose signature
appears below constitutes and appoints Richard M. Noling and Stephen M. Ambler,
and each of them, his true and lawful attorneys-in-fact and agents with full
power of substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement on Form S-8, and to file the same with all
exhibits thereto and all documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or his or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
PRINCIPAL EXECUTIVE OFFICER:
/s/ RICHARD M NOLING President, Chief Executive April 12, 2000
- ----------------------------------------- and Chief Financial Officer
Richard M. Noling
PRINCIPAL FINANCIAL OFFICER AND
PRINCIPAL ACCOUNTING OFFICER:
/s/ STEPHEN M. AMBLER Senior Vice President, Finance April 12, 2000
- ----------------------------------------- and Chief Financial Officer
Stephen M. Ambler
ADDITIONAL DIRECTORS:
/s/ NICHOLAS, VISCOUNT BEARSTED Chairman of the Board of Directors April 12, 2000
- -----------------------------------------
Nicholas, Viscount Bearsted
/s/ ALBERT E. SISTO Director April 12, 2000
- -----------------------------------------
Albert E. Sisto
/s/ VINCENT S. PINO Director April 12, 2000
- -----------------------------------------
Vincent S. Pino
/s/ DAVID G. FRODSHAM Director April 12, 2000
- -----------------------------------------
David G. Frodsham
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
4.01 Registration Rights Agreement, dated as of June 5, 1992, as
amended (incorporated herein by reference to Exhibit 4.02 of
the Registrant's Registration Statement on Form F-1 (File No.
33-98230) declared effective by the Commission on November 13,
1995).
4.02 Deposit Agreement between Registrant and The Bank of New York
(incorporated herein by reference to Exhibit 4.03 of the
Registrant's Annual Report on Form 10-K (File No. 0-27012) for
the year ended December 31, 1995 (the "1995 10-K").
4.03 Form of American Depositary Receipt (incorporated herein by
reference to Exhibit 4.04 of the 1995 10-K).
4.04 Registrant's 1995 Incentive Stock Option Plan for U.S.
Employees and related documents, as amended.*
4.05 Registrant's U.K. Employee Share Option Scheme 1996 and
related documents, as amended.*
4.06 Registrant's 1995 Employee Share Purchase Plan, as amended.*
5.01 Opinion of Macfarlanes.*
23.01 Consent of Macfarlanes (included in Exhibit 5.01).*
23.02 Consent of Independent Accountants.*
24.01 Power of Attorney (included on signature page).*
- ---------------------------
* filed herewith
<PAGE>
INSIGNIA SOLUTIONS plc
1995 INCENTIVE STOCK OPTION PLAN FOR U.S. EMPLOYEES
As Adopted February 9, 1995
Amended April 20, 1999
1. PURPOSE. The purpose of the Plan is to provide incentives
to attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent,
Subsidiaries and Affiliates, by offering them an opportunity to participate
in the Company's future performance through awards of share options.
Capitalized terms not defined in the text are defined in Section 20.
2. SHARES SUBJECT TO THE PLAN.
2.1 NUMBER OF SHARES AVAILABLE. Subject to Sections
2.2 and 14 of the Plan, the total number of Shares issued and reserved and
available for grant and issue pursuant to options under the Plan, the UK
Employee Share Option Scheme 1996 (the "UK PLAN"), the 1988 U.S. Stock Option
Plan (the "PRIOR PLAN") and the Company's Inland Revenue approved share
option scheme (the "INLAND REVENUE PLAN") (the "PLAN", the "UK PLAN", the
"PRIOR PLAN" and the "INLAND REVENUE PLAN", collectively, the "OPTION
PLANS"), shall be four million six hundred seventy two thousand and seventy
one (4,672,071) Shares. As of the Effective Date, options will no longer be
granted pursuant to the Prior Plan. As of the date of expiration of the
Inland Revenue Plan in December 1996, options will no longer be granted
pursuant to the Inland Revenue Plan. Shares shall again be available for
grant and issue in connection with future awards of options under the Plan
and the UK Plan if such Shares cease to be subject to an option granted
pursuant to the Option Plans. To the extent Shares are subject to options
granted pursuant to the UK Plan, the Inland Revenue Plan or the Prior Plan,
such Shares shall be unavailable for issue under this Plan until such options
expire or become unexercisable without having been exercised in full. To the
extent Shares are subject to options granted pursuant to this Plan, such
Shares shall be unavailable for issue under the UK Plan until such options
expire or become unexercisable without having been exercised in full.
2.2 ADJUSTMENT OF SHARES. In the event that the
number of Shares in issue is changed by a consolidation or sub-division of
ordinary shares of the Company or any bonus or other capitalization issue of
ordinary shares or any similar change in the capital structure of the Company
without consideration, or by a Corporate Transaction (as defined in Section
14.1) then, unless such change results in the termination of all outstanding
Awards as a result of the Corporate Transaction, (a) the number of Shares
reserved for issue under the Plan and (b) the Exercise Prices of and number
of Shares subject to outstanding Awards shall be proportionately adjusted,
subject to any required action by the Board or the shareholders of the
Company and compliance with applicable securities laws; PROVIDED, HOWEVER,
that fractions of a Share shall not be issued but shall either be paid in
cash at Fair Market Value or shall be rounded
<PAGE>
up to the nearest Share, as determined by the Committee; and PROVIDED,
FURTHER, that the Exercise Price of any Award may not be decreased to below
the U.S. Dollar equivalent of the par value of the Shares calculated by
reference to the Conversion Rate prevailing at the date of exercise of an
Award.
3. ELIGIBILITY. ISOs (as defined in Section 5 below) may be
granted only to employees (including officers and directors who are also
employees) of the Company or of a Parent or Subsidiary of the Company. NQSOs
(as defined in Section 5 below) may be granted to employees, officers,
directors, consultants, independent contractors and advisors of the Company
or any Parent, Subsidiary or Affiliate of the Company; PROVIDED such
consultants, contractors and advisors render bona fide services not in
connection with the offer and sale of securities in a capital-raising
transaction. A person may be granted more than one Award under the Plan. Each
person is eligible to receive up to an aggregate maximum of five hundred
thousand (500,000) Shares per fiscal year.
4. ADMINISTRATION.
4.1 COMMITTEE AUTHORITY. The Plan shall be
administered by the Committee. Subject to the general purposes, terms and
conditions of the Plan, the Committee shall have full power to implement and
carry out the Plan. The Committee shall have the authority to:
(a) construe and interpret the Plan, any Stock Option
Agreement and any other agreement or document executed
pursuant to the Plan;
(b) prescribe, amend and rescind rules and regulations
relating to the Plan;
(c) select persons to receive Awards;
(d) determine the form and terms of Awards;
(e) determine the number of Shares subject to Awards;
(f) determine whether Awards will be granted in replacement
of, or as alternatives to, other Awards under the Plan
or any other incentive or compensation plan of the
Company or any Parent, Subsidiary or Affiliate of the
Company;
(g) grant waivers of Plan or Award conditions;
(h) determine the vesting and exercisability of Awards;
(i) correct any defect, supply any omission, or reconcile
any inconsistency in the Plan, any Award or any Stock
Option Agreement;
(j) determine the disposition of Awards in the event of a
Participant's divorce or dissolution of marriage; and
-2-
<PAGE>
(k) make all other determinations necessary or advisable
for the administration of the Plan.
4.2 COMMITTEE DISCRETION. Any determination made by
the Committee with respect to any Award shall be made in its sole discretion
at the time of grant of the Award or, unless in contravention of any express
term of the Plan or Award, at any later time, and such determination shall be
final and binding on the Company and all persons having an interest in any
Award under the Plan. The Committee may delegate to one or more officers of
the Company the authority to grant an Award under the Plan to Participants
who are not Insiders of the Company.
4.3 COMMITTEE REQUIREMENT. If two or more members of
the Board are Outside Directors, the Committee shall be comprised of at least
two members of the Board, all of whom are Outside Directors.
5. STOCK OPTIONS. The Committee may grant Awards to eligible
persons and shall determine whether such Awards shall be Incentive Stock
Options within the meaning of the Code ("ISOs") or Nonqualified Stock Options
("NQSOs"), the number of Shares subject to the Award, the Exercise Price of
the Award, the period during which the Award may be exercised, and all other
terms and conditions of the Award, subject to the following:
5.1 FORM OF OPTION GRANT. Each Award granted under
the Plan shall be evidenced by a Stock Option Agreement which shall expressly
identify the Award as an ISO or NQSO, and be in such form and contain such
provisions (which need not be the same for each Participant) as the Committee
shall from time to time approve, and which shall comply with and be subject
to the terms and conditions of the Plan.
5.2 DATE OF GRANT. The date of grant of an Award
shall be the date on which the Committee makes the determination to grant
such Award, unless otherwise specified by the Committee. The Stock Option
Agreement and a copy of the Plan will be delivered to the Participant within
a reasonable time after the granting of the Award.
5.3 EXERCISE PERIOD. Awards shall be exercisable
within the times or upon the events determined by the Committee as in the
Stock Option Agreement; PROVIDED, HOWEVER, that no Award shall be exercisable
after the expiration of ten (10) years from the date the Award is granted;
and PROVIDED FURTHER that no ISO granted to a person who directly or by
attribution owns more than ten percent (10%) of the total combined voting
power of all classes of stock or shares of the Company or any Parent or
Subsidiary of the Company ("TEN PERCENT SHAREHOLDER") shall be exercisable
after the expiration of five (5) years from the date the Award is granted.
The Committee also may provide for the exercise of Awards to become
exercisable at one time or from time to time, periodically or otherwise, in
such number or percentage as the Committee determines.
5.4 EXERCISE PRICE. The Exercise Price shall be
determined by the Committee when the Award is granted subject to the
following:
-3-
<PAGE>
(a) The Exercise Price shall not be less than 100% of the
Fair Market Value of the Shares on the date of grant;
PROVIDED, that the Exercise Price of any ISO granted to
a Ten Percent Shareholder shall not be less than 110%
of the Fair Market Value of the Shares on the date of
grant. Payment for the Shares subscribed for may be
made in accordance with Section 6 of the Plan.
(b) The Exercise Price shall be in U.S. Dollars.
(c) The Exercise Price shall not be less than the U.S.
Dollar equivalent of the par value of the Shares
calculated by reference to the Conversion Rate
prevailing at the date of exercise of an Award.
5.5 METHOD OF EXERCISE. Awards may be exercised only
by delivery to the Company of a written exercise agreement (the "EXERCISE
AGREEMENT") in a form approved by the Committee (which need not be the same
for each Participant), stating the number of Shares being subscribed for, the
restrictions imposed on the Shares, if any, and such representations and
agreements regarding Participant's investment intent and access to
information and other matters, if any, as may be required or desirable by the
Company to comply with applicable securities laws, together with payment in
full of the Exercise Price for the number of Shares being subscribed for.
5.6 TERMINATION. Notwithstanding the exercise
periods set forth in the Stock Option Agreement, exercise of an Award shall
always be subject to the following:
(a) If the Participant is Terminated for any reason except
death or Disability, then Participant may exercise such
Participant's Awards only to the extent that such
Awards would have been exercisable upon the Termination
Date no later than three (3) months after the
Termination Date (or such longer time period not
exceeding five (5) years as may be determined by the
Committee), but in any event, no later than the
expiration date of the Awards.
(b) If the Participant is terminated because of death or
Disability (or the Participant dies within three (3)
months of such termination), then Participant's Awards
may be exercised only to the extent such Awards would
have been exercisable by Participant on the Termination
Date and must be exercised by Participant (or
Participant's legal representative or authorized
assignee) no later than (i) twelve (12) months after
the Termination Date in the case of disability or (ii)
eighteen (18) months after the Termination Date in the
case of death (or such longer time period not exceeding
five (5) years as may be determined by the Committee),
but in any event no later than the expiration date of
the Awards.
5.7 LIMITATIONS ON EXERCISE. The Committee may
specify a reasonable minimum number of Shares that may be subscribed for on
any exercise of an Award; PROVIDED that such minimum number will not prevent
Participant from exercising the Award for the full number of Shares for which
it is then exercisable.
-4-
<PAGE>
5.8 LIMITATIONS ON ISOs. The aggregate Fair Market
Value (determined as of the date of grant) of Shares with respect to which
ISOs are exercisable for the first time by a Participant during any calendar
year (under the Plan or under any other incentive stock option plan of the
Company or any Affiliate, Parent or Subsidiary of the Company) shall not
exceed $100,000. If the Fair Market Value of Shares on the date of grant with
respect to which ISOs are exercisable for the first time by a Participant
during any calendar year exceeds $100,000, the Awards for the first $100,000
worth of Shares to become exercisable in such calendar year shall be ISOs and
the Awards for the amount in excess of $100,000 that become exercisable in
that calendar year shall be NQSOs. In the event that the Code or the
regulations promulgated thereunder are amended after the Effective Date of
the Plan to provide for a different limit on the Fair Market Value of Shares
permitted to be subject to ISOs, such different limit shall be automatically
incorporated herein and shall apply to any Awards granted after the effective
date of such amendment.
5.9 MODIFICATION, EXTENSION OR RENEWAL. The
Committee may modify, extend or renew outstanding Awards and authorize the
grant of new Awards in substitution therefor; PROVIDED that any such action
may not, without the written consent of Participant, impair any of
Participant's rights under any Award previously granted. Any outstanding ISO
that is modified, extended, renewed or otherwise altered shall be treated in
accordance with Section 424(h) of the Code. The Committee may reduce the
Exercise Price of outstanding Awards without the consent of Participants
affected by a written notice to them; PROVIDED, HOWEVER, that the Exercise
Price may not be reduced below the minimum Exercise Price that would be
permitted under Section 5.4 of the Plan for Awards granted on the date the
action is taken to reduce the Exercise Price.
5.10 NO DISQUALIFICATION. Notwithstanding any other
provision in the Plan, no term of the Plan relating to ISOs shall be
interpreted, amended or altered, nor shall any discretion or authority
granted under the Plan be exercised, so as to disqualify the Plan under
Section 422 of the Code or, without the consent of the Participant affected,
to disqualify any ISO under Section 422 of the Code.
6. PAYMENT FOR SHARES. Payment for Shares subscribed for
pursuant to the Plan may be made in cash (by check) or, where expressly
approved for the Participant by the Committee and where permitted by law:
(a) by waiver of compensation due or accrued to Participant
for services rendered;
(b) provided that a public market for the Shares exists:
(1) through a "same day sale" commitment from
Participant and a broker-dealer that is a
member of the National Association of
Securities Dealers (a "NASD DEALER") whereby
the Participant irrevocably elects to exercise
the Award and to sell a portion of the Shares
so subscribed for in order to pay for the
Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of
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<PAGE>
such Shares to forward the Exercise Price
directly to the Company; or
(2) through a "margin" commitment from Participant
and a NASD Dealer whereby Participant
irrevocably elects to exercise the Award and
to pledge the Shares so subscribed for to the
NASD Dealer in a margin account as security
for a loan from the NASD Dealer in the amount
of the Exercise Price, and whereby the NASD
Dealer irrevocably commits upon receipt of
such Shares to forward the Exercise Price
directly to the Company; or
(c) by any combination of the foregoing.
7. WITHHOLDING TAXES.
7.1 WITHHOLDING GENERALLY. Whenever Shares are to be
issued in satisfaction of Awards granted under the Plan, the Company may
require the Participant to remit to the Company an amount sufficient to
satisfy federal, state and local withholding tax requirements prior to the
delivery of any certificate or certificates for such Shares. Whenever, under
the Plan, payments in satisfaction of Awards are to be made in cash, such
payment shall be net of an amount sufficient to satisfy federal, state, and
local withholding tax requirements.
7.2 STOCK WITHHOLDING. When, under applicable tax
laws, a Participant incurs tax liability in connection with the exercise of
any Award that is subject to tax withholding and the Participant is obligated
to pay the Company the amount required to be withheld, the Committee may
allow the Participant to satisfy the minimum withholding tax obligation by
electing to have the Company withhold from the Shares to be issued that
number of Shares having a Fair Market Value equal to the minimum amount
required to be withheld, determined on the date that the amount of tax to be
withheld is to be determined (the "TAX DATE"). All elections by a Participant
to have Shares withheld for this purpose shall be made in writing in a form
acceptable to the Committee and shall be subject to the following
restrictions:
(a) the election must be made on or prior to the applicable
Tax Date;
(b) once made, then except as provided below, the election
shall be irrevocable as to the particular Shares as to
which the election is made;
(c) all elections shall be subject to the consent or
disapproval of the Committee.
8. PRIVILEGES OF STOCK OWNERSHIP.
8.1 VOTING AND DIVIDENDS. No Participant shall have
any of the rights of a shareholder with respect to any Shares until the
Shares are issued to the Participant. After Shares are issued to the
Participant, the Participant shall be a shareholder and have all the rights
of a shareholder with respect to such Shares, including the right to vote and
receive all dividends or other distributions made or paid with respect to
such Shares.
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<PAGE>
8.2 FINANCIAL STATEMENTS. The Company shall provide
financial statements to each Participant prior to such Participant's
subscription for Shares under the Plan, and to each Participant annually
during the period such Participant has Awards outstanding; PROVIDED, HOWEVER,
the Company shall not be required to provide such financial statements to
Participants whose services in connection with the Company assure them access
to equivalent information.
9. TRANSFERABILITY. Subject to Section 4.1(j), Awards granted
under the Plan, and any interest therein, shall not: (a) be transferable or
assignable by the Participant, (b) be made subject to execution, attachment
or similar process, otherwise than by will or by the laws of descent and
distribution or as consistent with the specific Plan and Stock Option
Agreement provisions relating thereto or (c) during the lifetime of the
Participant, be exercisable by anyone other than the Participant, and any
elections with respect to an Award, may be made only by the Participant.
10. CERTIFICATES. All certificates for Shares or other
securities delivered under the Plan shall be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or
foreign securities law, or any rules, regulations and other requirements of
the SEC or any stock exchange or automated quotation system upon which the
Shares may be listed.
11. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award
shall not be effective unless such Award is in compliance with all applicable
federal and state securities laws, rules and regulations of any governmental
body, and the requirements of any stock exchange or automated quotation
system upon which the Shares may then be listed, as they are in effect on the
date of grant of the Award and also on the date of exercise or other issue.
Notwithstanding any other provision in the Plan, the Company shall have no
obligation to issue or deliver certificates for Shares under the Plan prior
to (a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable, and/or (b) completion of any
registration or other qualification of such shares under any state or federal
law or ruling of any governmental body that the Company determines to be
necessary or advisable. The Company shall be under no obligation to register
the Shares with the SEC or to effect compliance with the registration,
qualification or listing requirements of any state securities laws, stock
exchange or automated quotation system, and the Company shall have no
liability for any inability or failure to do so.
12. EMPLOYMENT WITH COMPANY.
12.1 NO OBLIGATION TO EMPLOY. Nothing in the Plan or
any Award granted under the Plan shall confer or be deemed to confer on any
Participant any right to continue in the employ of, or to continue any other
relationship with, the Company or any Parent, Subsidiary or Affiliate of the
Company or limit in any way the right of the Company or any Parent,
Subsidiary or Affiliate of the Company to terminate Participant's employment
or other relationship at any time, with or without cause.
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<PAGE>
12.2 NO RIGHT TO COMPENSATION. In the event that any
person holding an Award under the Plan ceases to be employed by, or otherwise
has ceased to provide services to, the Company or a Parent, Subsidiary or
Affiliate for whatever reason, he shall have no right to any compensation in
respect of this loss of right to receive Shares under this Plan.
13. EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any
time or from time to time, authorize the Company, with the consent of the
respective Participants, to issue new Awards in exchange for the surrender
and cancellation of any or all outstanding Awards. The Committee may at any
time buy from a Participant an Award previously granted with payment in cash,
Shares or other consideration, based on such terms and conditions as the
Committee and the Participant shall agree.
14. CORPORATE TRANSACTIONS.
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<PAGE>
14.1 ASSUMPTION OR REPLACEMENT OF AWARDS BY
SUCCESSOR. In the event of (a) a sale of the entire share capital of the
Company to another corporation (whether for consideration in cash or in the
form of securities of any kind), (b) a dissolution or liquidation of the
Company, (c) the sale of substantially all of the assets of the Company, or
(d) any other transaction which qualifies as a "corporate transaction" under
Section 424(a) of the Code wherein the shareholders of the Company give up
all of their equity interest in the Company ("CORPORATE TRANSACTION"), any or
all outstanding Awards may be assumed or replaced by the purchasing or
successor corporation, which assumption or replacement shall be binding on
all Participants. In the alternative, the purchasing or successor corporation
may substitute equivalent Awards or provide substantially similar
consideration to Participants as was provided to shareholders (after taking
into account the existing provisions of the Awards). The purchasing or
successor corporation may also issue, in place of outstanding Shares of the
Company held by the Participant, substantially similar shares or other
property subject repurchase restrictions no less favorable to the Participant.
14.2 EXPIRATION OF AWARDS. In the event such
purchasing or successor corporation, if any, refuses to assume or substitute
the Awards, as provided above, pursuant to a transaction described in
Subsection 14.1(a) above, such Awards shall expire on such transaction at
such time and on such conditions as the Board shall determine. In the event
such purchasing or successor corporation, if any, refuses to assume or
substitute the Awards as provided above, pursuant to a corporate transaction
described in Subsections 14.1(b), (c) or (d) above, or there is no purchasing
or successor corporation, and if the Company ceases to exist as a separate
corporate entity, then, notwithstanding any contrary terms in the Stock
Option Agreement, the Awards shall expire on a date at least twenty (20) days
after the Board gives written notice to Participants specifying the terms and
conditions of such termination.
14.3 OTHER TREATMENT OF AWARDS. Subject to any
greater rights granted to Participants under the foregoing provisions of this
Section 14, in the event of the occurrence of any Corporate Transaction
described in Section 14.1, any outstanding Awards shall be treated as
provided in the applicable agreement or plan of such Corporate Transaction.
14.4 ASSUMPTION OF AWARDS BY THE COMPANY. The
Company, from time to time, also may substitute or assume outstanding awards
granted by another company, whether in connection with an acquisition of such
other company or otherwise, by either (a) granting an Award under the Plan in
substitution of such other company's award, or (b) assuming such award as if
it had been granted under the Plan if the terms of such assumed award could
be applied to an Award granted under the Plan. Such substitution or
assumption shall be permissible if the holder of the substituted or assumed
award would have been eligible to be granted an Award under the Plan if the
other company had applied the rules of the Plan to such grant. In the event
the Company assumes an award granted by another company, the terms and
conditions of such award shall remain unchanged (EXCEPT that the exercise
price and the number and nature of Shares issuable upon exercise of any such
option will be adjusted appropriately pursuant to Section 424(a) of the
Code). In the event the Company elects to grant a new Award rather
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<PAGE>
than assuming an existing option, such new Award may be granted with a
similarly adjusted Exercise Price.
15. ADOPTION AND SHAREHOLDER APPROVAL. The Plan shall become
effective at such date and time as the Registration Statement filed with the
SEC relating to the Company's securities is declared effective (and then only
provided that the initial public offering later closes) (the "EFFECTIVE
DATE"). The Plan shall be approved by the shareholders of the Company
(excluding Shares issued pursuant to this Plan), consistent with applicable
laws, within twelve months before or after the date the Plan is adopted by
the Board. Upon the Effective Date, the Board may grant Awards pursuant to
the Plan; PROVIDED, HOWEVER, that: (a) no Award may be exercised prior to
initial shareholder approval of the Plan and (b) no Award granted pursuant to
an increase in the number of Shares approved by the Board shall be exercised
prior to the time such increase has been approved by the shareholders of the
Company.
16. TERM OF PLAN. The Plan will terminate ten (10) years from
the date the Plan is adopted by the Board or, if earlier, the date of
shareholder approval.
17. AMENDMENT OR TERMINATION OF PLAN. The Board may at any
time terminate or amend the Plan in any respect, including without limitation
amendment of any form of Stock Option Agreement or instrument to be executed
pursuant to the Plan; PROVIDED, HOWEVER, that the Board shall not, without
the approval of the shareholders of the Company, amend the Plan in any manner
that requires such shareholder approval pursuant to the Code or the
regulations promulgated thereunder as such provisions apply to ISO plans;
PROVIDED, FURTHER, that no amendment may be made to outstanding Awards
without the consent of the Participant.
18. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of the
Plan by the Board, the submission of the Plan to the shareholders of the
Company for approval, nor any provision of the Plan shall be construed as
creating any limitations on the power of the Board to adopt such additional
compensation arrangements as it may deem desirable, including, without
limitation, the granting of stock options otherwise than under the Plan, and
such arrangements may be either generally applicable or applicable only in
specific cases.
19. GOVERNING LAW. The Plan and all agreements, documents and
instruments entered into pursuant to the Plan shall be governed by and
construed in accordance with the internal laws of the State of California,
excluding that body of law pertaining to conflict of laws.
20. DEFINITIONS. As used in the Plan, the following terms
shall have the following meanings:
"AFFILIATE" means any corporation that directly, or
indirectly through one or more intermediaries, controls or is controlled by,
or is under common control with the Company where "control" (including the
terms "controlled by" and "under common control with") means the possession,
direct or indirect, of the power to cause the direction of the management and
policies of the corporation, whether through the ownership of voting
securities, by contract or otherwise.
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<PAGE>
"AWARD" means an award of an option to subscribe for
Shares.
"BOARD" means the Board of Directors of the Company.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMITTEE" means the committee appointed by the Board to
administer the Plan, or if no committee is appointed, the Board.
"COMPANY" means Insignia Solutions plc, a corporation
organized under the laws of England, or any successor corporation.
"CONVERSION RATE" means the average currency conversion
rate quoted by the Bank of America in London as the price for Pounds Sterling
purchased with U.S. Dollars.
"DISABILITY" means a disability, whether temporary or
permanent, partial or total, within the meaning of Section 22(e)(3) of the
Code, as determined by the Committee.
"EXERCISE PRICE" means the price per share at which a
holder of an Award may subscribe for the Shares issuable upon exercise of the
Award.
"FAIR MARKET VALUE" means the value of a share of the
Company's Ordinary Shares of 20p each determined as follows:
(a) if such Ordinary Shares, or instruments evidencing such
Ordinary Shares (e.g., American Depository Shares or
American Depository Receipts), are then quoted on the
Nasdaq National Market the closing price on the Nasdaq
National Market System on the trading day immediately
preceding the date on which Fair Market Value is
determined, or, if no such reported sale takes place on
such date, the closing price on the next preceding
trading date on which a reported sale occurred;
(b) if such Ordinary Shares, or instruments evidencing such
Ordinary Shares (e.g., American Depository Shares or
American Depository Receipts), are publicly traded and
are then listed on a national securities exchange, the
closing price or, if no reported sale takes place on
such date, the closing price on the next preceding
trading day on which a reported sale occurred;
(c) if such Ordinary Shares, or instruments evidencing such
Ordinary Shares (e.g., American Depository Shares or
American Depository Receipts), are publicly traded but
are not quoted on the Nasdaq National Market nor listed
or admitted to trading on a national securities
exchange, the average of the closing bid and asked
prices on such date, as reported by THE WALL STREET
JOURNAL, for the over-the-counter market; or
(d) if none of the foregoing is applicable, by the Board in
good faith.
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<PAGE>
"INSIDER" means an officer or director of the Company or
any other person whose transactions in the Company's ordinary shares are
subject to Section 16 of the Securities Exchange Act of 1934, as amended.
"OUTSIDE DIRECTOR" means any outside director as defined
in Section 162(m) of the Code and the regulations issued thereunder.
"PARENT" means any corporation (other than the Company)
in an unbroken chain of corporations ending with the Company, if at the time
of the granting of an Award under the Plan, each of such corporations other
than the Company owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other corporations in such
chain.
"PARTICIPANT" means a person who receives an Award under
the Plan.
"PLAN" means this Insignia Solutions plc 1995 Incentive
Stock Option Plan for U.S. Employees, as amended from time-to-time.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as
amended.
"SHARES" means Ordinary Shares of 20p each in the
Company, reserved for issue under the Option Plans, as adjusted pursuant to
Sections 2 and 14 of the Plan, any instruments evidencing such Ordinary
Shares (e.g., American Depository Shares or American Depository Receipts) and
any successor security.
"STOCK OPTION AGREEMENT" means, with respect to each
Award, the signed written agreement between the Company and the Participant
setting forth the terms and conditions of the Award.
"SUBSIDIARY" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company if,
at the time of granting of the Award, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.
"TERMINATION" or "TERMINATED" means, for purposes of the
Plan with respect to a Participant, that the Participant has ceased to
provide services as an employee, director, consultant, independent contractor
or advisor, to the Company or a Parent, Subsidiary or Affiliate of the
Company, except in the case of sick leave, military leave, or any other leave
of absence approved by the Committee; PROVIDED, that such leave is for a
period of not more than ninety (90) days, or reinstatement upon the
expiration of such leave is guaranteed by contract or statute. The Committee
shall have sole discretion to determine whether a Participant has ceased to
provide services and the effective date on which the Participant ceased to
provide services (the "TERMINATION DATE").
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INSIGNIA SOLUTIONS PLC
THE RULES
OF THE
INSIGNIA SOLUTIONS
U.K. EMPLOYEE SHARE OPTION SCHEME 1996
ADOPTED IN GENERAL MEETING ON 19 APRIL 1996
AND AMENDED IN GENERAL MEETING ON 29 MAY 1997
AND IN GENERAL MEETING ON 27 MAY 1999
<PAGE>
CONTENTS
<TABLE>
CLAUSE PAGE
<S> <C> <C>
1 Definitions 1
2 Grant of Options 5
3 Exercise Price 5
4 Limitations 6
5 Exercise and Lapse of Options 6
6 Payment of Exercise Price 9
7 Takeover and Liquidation 10
8 Variation in the Share Capital of the Company 14
9 Rights of Ordinary Shares Allotted 14
10 Availability of Shares 15
11 Buyout of Options 15
12 Transfers of Options 15
13 Employment with the Company 16
14 Documents 16
15 Administration 16
16 Governing Law 17
APPENDIX - Option Certificate
</TABLE>
<PAGE>
INSIGNIA SOLUTIONS
U.K. EMPLOYEE SHARE OPTION SCHEME 1996
<TABLE>
<CAPTION>
<S> <C>
1 DEFINITIONS
1.1 In this Scheme references to the following words and
expressions shall bear the following meanings:-
ACT: the Income and Corporation Taxes Act 1988;
ADOPTION DATE: the date on which the Scheme is adopted by the
Company in general meeting;
AFFILIATE: any company that directly, or indirectly through
one or more intermediaries, controls or is controlled by, or
is under common control with the Company where "control"
(including the terms "controlled by" and "under common control
with") means the possession, direct or indirect, of the power
to cause the direction of the management and policies of the
company, whether through the ownership of voting securities,
by contract or otherwise;
AUDITORS: the auditors for the time being of the Company;
BOARD: the Board of Directors of the Company;
COMMITTEE: the Compensation Committee of the Board or such
duly constituted committee of the Board comprising of at least
two Disinterested Persons and which complies with the
provisions of Section 16 of the Exchange Act whilst the
Company is subject to the provisions of such Section;
COMPANY: Insignia Solutions plc;
CONTROL: has the same meaning as in Section 840 of the Act;
CONVERSION RATE: the average currency conversion rate quoted
by the Bank of
<PAGE>
America in London as the price for Pounds Sterling purchased
with US Dollars;
DATE OF GRANT: the date on which an Option is granted as
specified in the relevant Option Certificate;
DISINTERESTED PERSON: a director who has not, during the
period that person is a member of the Committee and for one
year prior to service as a member of the Committee, been
granted or awarded equity securities pursuant to the Scheme or
any other employee share scheme of the Company or any Parent,
Subsidiary or Affiliate of the Company, except in accordance
with the requirements set forth in rules as promulgated by the
SEC under Section 16(b) of the Exchange Act, as such rules are
amended from time to time and as interpreted by the SEC;
EXCHANGE ACT: the statute in the United States of America
known as the Securities Exchange Act 1934, as amended;
EXERCISE PRICE: the amount payable for an Option Share on the
exercise of an Option to be determined in accordance with Rule
3;
GROUP: the Company, its holding company and subsidiaries (as
defined in Section 736 of the Companies Act 1985);
INSIDER: an officer or director of the Company or any other
person whose transactions in the Ordinary Shares are subject
to Section 16 of the Exchange Act;
LAST EXERCISE DATE: in respect of any Option or part of any
Option, the date specified in the relevant Option Certificate
as determined by the Committee being a date not later than ten
years after the Date of Grant of the Option;
MARKET VALUE:
(a) if Ordinary Shares, or instruments evidencing
Ordinary Shares, are then quoted on the Nasdaq
National Market the closing price on the Nasdaq
National Market System on the trading day immediately
preceding the Date of Grant of an Option, or, if no
such reported sale takes place on such date,
2
<PAGE>
the closing price on the next preceding trading date
on which a reported sale occurred;
(b) if Ordinary Shares, or instruments evidencing
Ordinary Shares, are publicly traded and are then
listed on a national securities exchange, the closing
price on the trading day immediately preceding the
Date of Grant of an Option, or, if no reported sale
takes place on such date, the closing price on the
next preceding trading day on which a reported sale
occurred;
(c) if Ordinary Shares, or instruments evidencing
Ordinary Shares, are publicly traded but are not
quoted on the Nasdaq National Market nor listed or
admitted to trading on a national securities
exchange, the average of the closing bid and asked
prices on the day immediately preceding the Date of
Grant of an Option, as reported by The Wall Street
Journal, for the over-the-counter market;
(d) if none of the foregoing is applicable, by the Board
in good faith.
1986 SCHEME: the Company's 1986 Executive Share Option Scheme;
OPTION SCHEME: a right to acquire Option Shares granted
pursuant to the Scheme;
OPTION CERTIFICATE: the Option Certificate substantially in
the form set out in the Appendix as such certificate may be
amended by the Committee from time to time;
OPTION HOLDER: a Qualified Person who holds an Option in
accordance with the terms of the Scheme or where the context
permits a person becoming entitled to any such Option in
consequence of the death of the original Option Holder;
OPTION SHARES: issued or unissued Ordinary Shares in respect
of which an Option is granted;
ORDINARY SHARES: the ordinary shares in the capital of the
Company and any instruments evidencing such Ordinary Shares;
3
<PAGE>
PARENT: any company (other than the Company) in an unbroken
chain of companies ending with the Company, if at the time of
the granting of an Option under the Scheme, each of such
companies other than the Company owns shares possessing 50 per
cent or more of the total combined voting power of all classes
of shares in one of the other companies in such chain;
QUALIFIED PERSON: any employee (including officers and
directors who are also employees) of a company in the Group;
THE SCHEME: this Insignia Solutions U.K. Employee Share Option
Scheme 1996 in its present form with and subject to any
amendments hereto properly effected;
SEC: the United States of America Securities and Exchange
Commission;
SUBSIDIARY: any company (other than the Company) in an
unbroken chain of companies beginning with the Company if, at
the time of granting of an Option, each of the companies other
than the last company in the unbroken chain owns shares
possessing 50 per cent or more of the total combined voting
power of all classes of shares in one of the other companies
in such chain.
1.2 In this Scheme (unless the context requires otherwise):-
1.2.1 any reference to any statute or statutory provision shall be
construed as including a reference to any modification,
re-enactment or extension of such statute or statutory
provision for the time being in force, to any subordinate
legislation made under the same and to any former statutes or
statutory provisions which it consolidated or re-enacted;
1.2.2 any reference to a Rule is to a Rule of this Scheme, as
amended from time to time;
1.2.3 the singular includes a reference to the plural and vice
versa;
1.2.4 the masculine gender shall include the feminine gender;
4
<PAGE>
1.2.5 references to the exercise of an Option shall where the
context so allows include the exercise of an Option in part.
2 GRANT OF OPTIONS
2.1 Subject to the limitations and conditions of the Scheme and
unless prohibited by law, the Committee may grant Options
following the Adoption Date at any time to any Qualified
Person as it may in its sole discretion determine.
2.2 On the grant of an Option, the Committee shall determine the
Exercise Price (calculated in accordance with Rule 3) and the
Last Exercise Date of the Option and shall specify such
details in the Option Certificate.
2.3 There shall be no consideration payable for the grant of an
Option.
2.4 As soon as practicable after the grant of an Option the
Committee shall arrange for the despatch of an Option
Certificate duly sealed or executed as a deed by the Company
to each Option Holder to whom an Option has been granted. An
Option Holder may disclaim an Option by notice in writing to
the Company within fourteen days after the date of the Option
Certificate.
3 EXERCISE PRICE
3.1 Subject to adjustment pursuant to Rule 8, the Exercise Price
at the relevant Date of Grant shall be determined by the
Committee but it may not be less than the higher of:-
3.1.1 where the Option is an option to subscribe for Ordinary
Shares, the US Dollar equivalent of the nominal value of an
Ordinary Share calculated by reference to the prevailing
Conversion Rate; and
3.1.2 the Market Value of an Ordinary Share.
3.2 The Exercise Price shall be expressed in US Dollars.
5
<PAGE>
4 LIMITATIONS
4.1 No Options shall be granted under the Scheme later than ten
years after the Adoption Date.
4.2 Subject to adjustment pursuant to Rule 8, no Option shall be
granted if the number of Ordinary Shares over which it is
proposed to grant the Option when aggregated with all Ordinary
Shares which have been issued or which might be issued in the
future pursuant to options and rights (excluding those which
have lapsed or have been surrendered) granted under the 1988
US Stock Option Plan, the 1995 Incentive Stock Option Plan for
US Employees and the 1986 Scheme will exceed 4,672,071
Ordinary Shares.
4.3 If an Option is granted in excess of the limitation in Rule
4.2, such Option shall be limited and take effect over such
number of Ordinary Shares as would be within the said
limitation and the Committee shall, if appropriate, as soon as
practicable arrange for any original Option Certificate to be
cancelled and a replacement Option Certificate to be issued in
its place.
5 EXERCISE AND LAPSE OF OPTIONS
5.1 Notwithstanding any other provision of this Rule 5, an Option
shall not in any event be exercisable more than ten years
after the Date of Grant of that Option.
5.2 Options may be exercised by an Option Holder who is a
Qualified Person as follows:-
5.2.1 where such an Option Holder does not hold a subsisting option
granted under the 1986 Scheme at the Date of Grant of the
first Option granted to him then such first Option may be
exercised on or after the first anniversary of the Date of
Grant as to 1/48th of the number of Ordinary Shares comprised
in such Option (rounded to the nearest whole number) for each
complete month he has been employed by the Group since the
Date of Grant and shall lapse on the Last Exercise Date;
6
<PAGE>
5.2.1.1 where such an Option Holder holds a
subsisting option granted under the 1986
Scheme at the Date of Grant of the first
Option granted to him; or
5.2.1.2 in the case of each Option granted to such
Option Holder after his first Option
then such Options may be exercised as to 1/48th of the number
of Ordinary Shares comprised in such Option (rounded to the
nearest whole number) for each complete month he has been
employed by the Group since the Date of Grant and shall lapse
on the Last Exercise Date.
5.3 An Option may be exercised otherwise than as set out in Rule
5.2 in the circumstances and during the periods set out
below:-
5.3.1 if an Option Holder ceases to be employed by the Group by
reason of his death his Option may be exercised to the extent
that his Option would have been exercisable at the time of his
death within eighteen months of his death (or such longer
period not exceeding five years as may be determined by the
Committee) by his legal personal representatives provided that
such exercise is not later than the Last Exercise Date and
thereafter the Option shall lapse;
5.3.2 if an Option Holder ceases to be employed by the Group by
reason of his disability (as determined by the Committee) his
Option may be exercised to the extent that his Option would
have been exercisable at the time of his cessation of
employment within twelve months of the date of such cessation
(or such longer period not exceeding five years as may be
determined by the Committee) provided that such exercise is
not later than the Last Exercise Date and thereafter the
Option shall lapse;
5.3.3 if an Option Holder ceases to be employed by the Group
(otherwise than by reason of his death or disability) his
Option may be exercised to the extent that his Option would
have been exercisable at the time of cessation of his
employment within three months of the date of such cessation
(or such longer period not exceeding five years as may be
determined by the Committee)
7
<PAGE>
provided that such exercise is not later than the Last
Exercise Date and thereafter his Option shall lapse.
5.4 Each Option is to be exercisable by an Option Holder to the
extent that the Option has become exercisable in whole or in
part.
5.5 Exercise of an Option is to be by application in writing
addressed to the Company and specifying the number of Option
Shares in respect of which the Option is being exercised on
that occasion and the method of payment of the Exercise Price
for such Option Shares, such application to be delivered or
sent by prepaid post to the registered office for the time
being of the Company or to such office as may from time to
time be specified by the Company in writing to the Option
Holder.
5.6 Subject to the regulations and enactments for the time being
in force under any applicable national or foreign securities
law and any rules, regulations and other requirements of any
stock exchange or automated quotation system upon which the
Ordinary Shares may be listed or quoted and subject to
compliance by the Option Holder with the terms of the Option
the Company will after receipt of the application make an
allotment to the Option Holder of the number of Ordinary
Shares specified in the application at the Exercise Price (as
adjusted in accordance with the provisions of the Scheme) and
will (subject to the provisions of Rule 5.7) deliver to the
Option Holder evidence of title to such Ordinary Shares
provided that instead of allotting and issuing the appropriate
number of Ordinary Shares the Company shall have the right to
satisfy its obligations of allotment by (in whole or in part)
procuring that some or all of the Ordinary Shares are
transferred by a third party to the relevant Option Holder.
For these purposes delivery or transfer to an Option Holder
includes delivery or transfer to a nominee for the Option
Holder provided that the Option Holder acquires the beneficial
ownership of the Ordinary Shares delivered or transferred.
5.7 The Company shall have no obligation to issue or deliver
certificates for Ordinary Shares under the Scheme prior to:-
8
<PAGE>
5.7.1 obtaining any approvals from governmental agencies that the
Company determines are necessary or advisable; and
5.7.2 completion of any registration or other qualification of the
Ordinary Shares under any applicable national or foreign law
or ruling of any governmental body that the Company determines
to be necessary or advisable.
6 PAYMENT OF EXERCISE PRICE
6.1 Payment of the Exercise Price for the Ordinary Shares may be
made in cash (by cheque) or where expressly approved for the
Option Holder by the Committee and where permitted by law:-
6.1.1 by waiver of remuneration due or accrued to the Option Holder
by any company in the Group for services rendered;
6.1.2 provided that a public market for the Ordinary Shares exists:-
6.1.2.1 through a "same day sale" commitment from
the Option Holder and a broker-dealer that
is a member of the National Association of
Securities Dealers ("a NASD Dealer") whereby
the Option Holder irrevocably elects to
exercise his Option and to sell a portion of
the Ordinary Shares so subscribed for in
order to pay for the Exercise Price, and
whereby the NASD Dealer irrevocably commits
upon receipt of such Ordinary Shares to
forward the Exercise Price directly to the
Company; or
6.1.2.2 through a "margin" commitment from an Option
Holder and a NASD Dealer whereby the Option
Holder irrevocably elects to exercise his
Option and to pledge the Ordinary Shares so
subscribed for to the NASD Dealer in a
margin account as security for a loan from
the NASD Dealer in the amount of the
Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of such
Ordinary Shares to forward the Exercise
Price directly to the Company; or
9
<PAGE>
6.1.3 by any combination of cash and the methods described in this
Rule 6.1.
6.2 Where the payment is to be made in Pounds Sterling then the
amount payable shall be calculated by reference to the
Conversion Rate prevailing at the date of payment.
7 TAKEOVER AND LIQUIDATION
7.1 In the event of:-
7.1.1 any person obtaining Control of the Company as a result of
making:-
7.1.1.1 a general offer to acquire the whole of the
issued ordinary share capital of the Company
(not already owned by such person) which is
made on a condition such that if it is
satisfied the person making the offer will
have Control of the Company; or
7.1.1.2 a general offer to acquire all the shares in
the Company which are of the same class as
the Option Shares (not already owned by such
person);
7.1.2 any company obtaining Control of the Company in pursuance of a
compromise or arrangement sanctioned by the Court under
Section 425 of the Companies Act 1985; or
7.1.3 the sale of substantially all of the assets of the Company;
the purchaser or acquiring company ("the Acquiring Company")
may:-
7.1.4 in consideration for the release by an Option Holder of his
subsisting Option grant to such Option Holder a new option
over shares in the Acquiring Company which is otherwise
equivalent (as defined in Rule 7.8) to his subsisting Option;
10
<PAGE>
7.1.5 in consideration for the release by an Option Holder of his
subsisting Option grant to such Option Holder an equivalent
new option over shares in the Acquiring Company governed by
the rules of an employee share option scheme of the Acquiring
Company; or
7.1.6 offer substantially similar consideration to Option Holders as
is offered to shareholders of the Company (after taking into
account the existing provisions of the Option).
7.2 In the event that the Acquiring Company, pursuant to a
transaction described in Rule 7.1.1 above, refuses to make a
proposal as described in Rules 7.1.4 to 7.1.6 above to an
Option Holder prior to the commencement of the earliest of the
periods described in Rules 7.2.1.1 and 7.2.1.2 below, then:-
7.2.1 if his Option has already become capable of exercise under
these Rules then the Option Holder may exercise it to the
extent that the Option has become exercisable until the end of
whichever of the following periods finishes earliest:-
7.2.1.1 a period of one month beginning with the
time when the Acquiring Company has obtained
Control of the Company and (if applicable)
any condition subject to which the offer is
made is satisfied; and
7.2.1.2 if the Acquiring Company becomes bound or
entitled to acquire the shares in the
Company under Sections 428 to 430F of the
Companies Act 1985, the period when that
person remains so bound or entitled
and then any such Options as remain unexercised shall lapse;
7.2.2 if his Option has not already become capable of exercise under
these Rules then such Option shall lapse at such time and on
such conditions as the Board shall determine.
11
<PAGE>
7.3 For the purposes of Rules 7.1 and 7.2 above a person shall be
deemed to have obtained Control of the Company if he and
others acting in concert with him have together obtained
Control of it.
7.4 In the event that the Acquiring Company, pursuant to a
transaction described in Rule 7.1.2 above, refuses to make a
proposal as described in Rules 7.1.4 to 7.1.6 above to an
Option Holder prior to the expiry of one month after the Court
sanctions the compromise or arrangement then his Option shall
be subject to the provisions of Rule 7.7.
7.5 In the event that the Acquiring Company, pursuant to a
transaction described in Rule 7.1.3 above, refuses to make a
proposal as described in Rules 7.1.4 to 7.1.6 above to an
Option Holder then his Option shall lapse at such time and on
such conditions as the Board shall determine.
7.6 In the event of a members' voluntary winding up of the Company
any Option Holder may, by notice in writing to the Company
within 60 days of the commencement of the winding up (such
notice being accompanied by payment of the Exercise Price),
elect in relation to any Option which has already become
capable of exercise under these Rules to be treated as if that
Option had been exercised either to the full extent that it is
then capable of being exercised or to the extent specified in
the notice, immediately before the commencement of the winding
up, and such Option Holder shall then be entitled to be paid a
sum equal to the amount he would have received as a holder of
the Ordinary Shares to which he would have been entitled upon
such exercise. Subject as aforesaid, all Options shall lapse
on the winding up of the Company.
7.7 If under Section 425 of the Companies Act 1985 it is proposed
that the court sanctions a compromise or arrangement proposed
for the purposes of or in connection with a scheme for the
reconstruction of the Company or its amalgamation with any
other company or companies the Company shall give notice
thereof to all Option Holders at the same time as it sends
notices to members of the Company summoning the meeting to
consider such a compromise or arrangement. Then at the time
that such notice is given:-
12
<PAGE>
7.7.1 if the Option has already become capable of exercise under
these Rules, the Option Holder may exercise the Option, to the
extent that the Option has become exercisable, before the
expiry of the later of one month from the date of such notice
and one month from the date on which the Court sanctions the
compromise or arrangement and thereafter the Option shall
lapse. The exercise of an Option under this Rule 7.7.1 shall
be conditional on such compromise or arrangement becoming
effective;
7.7.2 if the Option has not already become capable of exercise under
these Rules the Option shall lapse at such time and on such
conditions as the Board shall determine.
It shall be a condition of exercising the Option under this
Rule 7.7 that, after exercising the Option, the Option Holder
shall transfer or otherwise deal with the Ordinary Shares
issued to him so as to place him in the same position (or as
near as possible) as would have been the case if such Ordinary
Shares had been subject to such compromise or arrangement.
7.8 For the purposes of Rule 7.1.4 above a new option over shares
in the Acquiring Company (hereinafter called the "New Option")
shall be equivalent to a subsisting option (hereinafter called
the "Old Option") if the date of grant is deemed to be the
same date as the Date of Grant of the Old Option; if the
aggregate exercise price of the Ordinary Shares subject to the
New Option is as nearly as practicable the same as the
aggregate Exercise Price of the Ordinary Shares subject to the
Old Option; and (save as provided in the Rules and save for
the number, description and Exercise Price of the Ordinary
Shares subject to the New Option) the other rights and terms
attaching to the New Option are as nearly as practicable the
same as those attaching to the Old Option. The New Option
shall, for all other purposes of the Scheme, be treated as
having been acquired at the same time as the Old Option.
7.9 With effect from the date on which an Option Holder releases
the Old Option in consideration of the grant to him of the New
Option, Rule 1 and Rules 5 to 16 inclusive shall, in relation
to the New Option, be construed for the purposes of that New
Option as if references directly or indirectly to "the
Company" and to
13
<PAGE>
"Ordinary Shares" were references to the Acquiring Company and
to shares in the Acquiring Company.
7.10 Subject to the provisions of Rule 7.1 to 7.9 above, if any of
the corporate transactions described in such Rules should
occur, any outstanding Options shall be treated in the manner
provided for in the applicable agreement or plan of such
corporate transaction.
8 VARIATION IN THE SHARE CAPITAL OF THE COMPANY
8.1 On any variation of the share capital of the Company (whether
by way of capitalisation or rights issue, sub-division or
consolidation of the Ordinary Shares or a share capital
reduction) the Exercise Price and/or the number and nominal
value of Ordinary Shares comprised in an Option and/or the
aggregate maximum number of Ordinary Shares available under
the Scheme may be varied in such manner as the Committee shall
determine and such decision of the Committee shall be final
and binding on the Option Holders and the Company subject to
written notification being given to the Option Holders.
8.2 An adjustment to the Exercise Price shall not be made pursuant
to the provisions of this Rule 8 which would result in any
Option Shares being issued unlawfully at a discount.
8.3 A variation shall not be made pursuant to this Rule 8 until
the Auditors shall (acting as experts and not as arbitrators)
have notified the Committee in writing that the proposed
variation is, in their opinion, fair and reasonable.
9 RIGHTS OF ORDINARY SHARES ALLOTTED
9.1 Ordinary Shares to be allotted pursuant to the exercise of any
Option shall rank pari passu in all respects and as one class
with the Ordinary Shares in issue at the date of allotment and
Ordinary Shares allotted or transferred shall rank in full for
all dividends and distributions the record date of which falls
on or after the date of exercise of the Option but shall not
rank for any dividend or distribution the record date of which
precedes the date of exercise of the Option.
14
<PAGE>
9.2 The Company shall not be under an obligation to register the
Ordinary Shares allotted pursuant to the exercise of an Option
with the SEC or to effect compliance with the registration,
qualification or listing requirements of any national or
foreign securities laws, stock exchange or automated quotation
system, and the Company shall have no liability for any
inability or failure to do so.
10 AVAILABILITY OF SHARES
The Company shall at all times have available sufficient
unissued Ordinary Shares to meet any exercise of any Option,
taking into account any arrangements made by the Company to
procure the transfer by a third party to the relevant Option
Holder of Ordinary Shares to satisfy (whether in full or in
part) the exercise of any Option.
11 BUYOUT OF OPTIONS
The Committee may at any time buy from an Option Holder his
Option previously granted with payment in cash, Ordinary
Shares or other consideration, based on such terms and
conditions as the Committee and the Option Holder shall agree.
12 TRANSFERS OF OPTIONS
12.1 No Option granted pursuant to the Scheme nor the benefit of an
Option may be transferred, assigned, charged or otherwise
alienated save that nothing in the Rules of the Scheme shall
prohibit the transmission of the Option by operation of law in
the event of the death of an Option Holder.
12.2 If an Option Holder does or suffers an act or thing whereby he
would or might be deprived of the legal or beneficial
ownership of an Option that Option shall forthwith lapse and
the Committee shall not knowingly permit its exercise.
15
<PAGE>
13 EMPLOYMENT WITH THE COMPANY
13.1 Nothing in the Scheme or any Option granted under the Scheme
shall confer or be deemed to confer on any Option Holder any
right to continue in the employ of any member of the Group or
limit in any way the right of any member of the Group to
terminate the employment of the Option Holder with or without
cause.
13.2 If any Option Holder shall cease to be employed by or hold
office with a member of the Group for any reason he shall not
be entitled by way of compensation for loss of office or
otherwise to any sum or other benefit whatsoever to compensate
him for the loss of any right under the Scheme notwithstanding
any provision to the contrary in his contract of employment.
14 DOCUMENTS
The Company shall deliver to each Option Holder a copy of the
documents sent to ordinary shareholders of the Company as a
class of shareholders.
15 ADMINISTRATION
15.1 The Scheme shall be administered by the Committee. The
Committee shall have the power to:-
15.1.1 construe and interpret the Scheme, any Option Certificates and
any other agreement or document executed pursuant to the
Scheme;
15.1.2 prescribe, amend and rescind rules and regulations relating to
the Scheme;
15.1.3 correct any defect, supply any omission, or reconcile any
inconsistency in the Scheme or any agreement or document
executed pursuant to the Scheme;
15.1.4 make all other determinations necessary or advisable for the
administration of the Scheme.
16
<PAGE>
15.2 Any determination made by the Committee with respect to any
Option shall be made in its sole discretion at the time of
grant of the Option or, unless in contravention of any express
term of the Scheme or Option, at any later time, and such
determination shall be final and binding on the Company and
all persons having an interest in any Option. The Committee
may delegate to one or more officers of the Company the
authority to grant Options under the Scheme to Option Holders
who are not Insiders of the Company.
15.3 An Option shall not be effective unless such Option is in
compliance with all relevant national and foreign securities
laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation
system upon which the Ordinary Shares may then be listed or
quoted, as they are in effect on the Date of Grant of such
Option and also on the date of exercise or other issue.
15.4 If any provision of any Rule or any Option conflicts with the
applicable requirements of Rule 16b-3 (or its successors) of
the SEC promulgated under the Exchange Act in relation to
Option Holders who are or may be Insiders then those
provisions to the extent possible shall be interpreted or
deemed amended so as to avoid such conflict.
15.5 The Board may at any time terminate or amend the Scheme in any
respect, including without limitation amendment of any form of
Option Certificate or instrument to be executed pursuant to
the Scheme, provided however that the Board shall not, without
the approval of the shareholders of the Company, amend the
Scheme in any manner that requires such shareholder approval
pursuant to the Exchange Act or Rule 16b-3 (or its successor),
as amended, thereunder, provided, further that no amendment
may be made to outstanding Options without the consent of the
Option Holders.
16 GOVERNING LAW
The Scheme shall be governed by and construed in accordance
with the Laws of England and Wales.
</TABLE>
17
<PAGE>
APPENDIX
OPTION CERTIFICATE
U.K. EMPLOYEE SHARE OPTION SCHEME 1996
Certificate No. JAN. 96/02
INSIGNIA SOLUTIONS PLC
(Registered in England No. 1961960)
1 This is to certify that Name: [ ]
Address: [ ]
[ ]
[ ]
is a holder of an Option to subscribe for the number of Ordinary Shares of 20p
each in the Company shown in Box `A' below subject to the Rules of the Insignia
Solutions UK Employee Share Option Scheme 1996.
<TABLE>
<CAPTION>
- -------------------------------------------- ------------------------------ -------------------------
`A' `B'
NUMBER OF ORDINARY SHARES COMPRISED IN THE EXERCISE PRICE PER ORDINARY `C'
OPTION SHARE DATE OF GRANT OF OPTION
- -------------------------------------------- ------------------------------ -------------------------
<S> <C> <C>
[ ] US$ [ ] [ ]
- -------------------------------------------- ------------------------------ -------------------------
</TABLE>
2 The Date of Grant of the Option is shown in Box `C' above and
the Option is exercisable in whole or in part [not earlier
than the first anniversary of the Date of Grant] subject to
and in accordance with the Rules of the Scheme.
3 The figures shown in Box `A' and Box `B' above are subject to
adjustment in certain circumstances in accordance with the
Rules of the Scheme.
4 The Option is not transferable, assignable or chargeable.
5 The Option will lapse on the Last Exercise Date being the
[tenth] anniversary of the Date of Grant to the extent that it
has not been exercised.
6 The Option [will be exercisable as to 25% of the shares over
which it has been granted on [ ] and will be exercisable as to
1/48 of the Ordinary Shares over which it has been granted on
the expiry of each complete month thereafter] [will be
exercisable as to 1/48 of the Ordinary Shares over which it
has been granted on the expiry of each complete month since
the Date of Grant]. The Option is exercisable only by notice
in writing in the form prescribed under the Rules of the
Scheme. This certificate must be sent to the Company or such
office as may be specified from time to time by the Company
whenever the Option is
<PAGE>
exercised in whole or in part. Where the Option is exercised
in respect of part only of the Ordinary Shares comprised in
the certificate, the certificate will be returned to the
holder with the balance of Ordinary Shares endorsed overleaf.
7 The rights under the Option may be renounced in whole or in
part by the holder giving notice in writing to the Company
WITHIN FOURTEEN DAYS AFTER THE DATE OF THIS CERTIFICATE. This
certificate must be returned to the Company if the holder
wishes to renounce in whole or in part his rights hereunder.
If rights are renounced in part only the appropriate
replacement certificate will be issued to the holder.
8 This document shall be presumed to be delivered and is
intended by the parties to be a deed when (and not before) it
is dated.
Given under the Common Seal )
of INSIGNIA SOLUTIONS PLC )
in the presence of:- )
- --------------------------
Director
- --------------------------
Secretary
- --------------------------
Date:
2
<PAGE>
INSIGNIA SOLUTIONS PLC
1995 EMPLOYEE SHARE PURCHASE PLAN
Adopted by the Board of Directors on February 9, 1995 and
Amended on December 15, 1995, on July 21, 1998 and on May 27, 1999
1. ESTABLISHMENT OF PLAN
Insignia Solutions plc (the "COMPANY") proposes to grant options to
subscribe for the Company's ordinary shares of 20p each, or any instruments
evidencing such ordinary shares (e.g., American Depositary Shares or American
Depositary Receipts), to eligible employees of the Company and its Subsidiaries
(as hereinafter defined) pursuant to this Insignia Solutions plc 1995 Employee
Share Purchase Plan (this "PLAN"). For purposes of this Plan, "Parent
Corporation" and "Subsidiary" (collectively, "SUBSIDIARIES") shall have the
same meanings as "parent corporation" and "subsidiary corporation" in Sections
424(e) and 424(f), respectively, of the Internal Revenue Code of 1986, as
amended (the "CODE"). The Company intends the Plan to qualify as an "employee
stock purchase plan" under Section 423 of the Code (including any amendments to
or replacements of such section), and the Plan shall be so construed. Any term
not expressly defined in the Plan but defined for purposes of Section 423 of
the Code shall have the same definition herein. A total of nine hundred
thousand (900,000) of the Company's ordinary shares is reserved for issue under
the Plan. Such number shall be subject to adjustments effected in accordance
with Section 14 of the Plan.
2. PURPOSES
The purpose of the Plan is to provide employees of the Company and
Subsidiaries designated by the Board of Directors of the Company (the "BOARD")
as eligible to participate in the Plan with a convenient means of acquiring an
equity interest in the Company through payroll deductions, to enhance such
employees' sense of participation in the affairs of the Company and
Subsidiaries, and to provide an incentive for continued employment.
3. ADMINISTRATION
This Plan may be administered by the Board or a committee appointed
by the Board (the "COMMITTEE"). If, at the time the Company becomes subject to
Section 16 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT"), a majority of the Board is not comprised of Disinterested Persons as
defined in Rule 16b-3(d) promulgated under the Exchange Act, the Board shall
appoint a committee consisting of at least two (2) members of the Board, each
of whom is a Disinterested Person. As used in this Plan, references to the
"Committee" shall mean either such committee or the Board if no committee has
been established. After registration of the Company under the Exchange Act,
Board members who are not
<PAGE>
Disinterested Persons may not vote on any matters affecting the administration
of this Plan, but any such member may be counted for determining the existence
of a quorum at any meeting of the Board. Subject to the provisions of the Plan
and the limitations of Section 423 of the Code or any successor provision in
the Code, all questions of interpretation or application of the Plan shall be
determined by the Board and its decisions shall be final and binding upon all
participants. Members of the Board shall receive no compensation for their
services in connection with the administration of the Plan, other than standard
fees as established from time to time by the Board for services rendered by
Board members serving on Board committees. All expenses incurred in connection
with the administration of the Plan shall be paid by the Company.
4. ELIGIBILITY
Any employee of the Company or the Subsidiaries is eligible to
participate in an Offering Period (as hereinafter defined) under the Plan
except the following:
(a) employees who are not employed by the Company or
Subsidiaries on the fifteenth (15th) day of the month before the beginning of
such Offering Period;
(b) employees who are customarily employed for less than 20
hours per week;
(c) employees who are customarily employed for less than 5
months in a calendar year;
(d) employees who, together with any other person whose
stock or shares would be attributed to such employee pursuant to Section 424(d)
of the Code, own stock or shares or hold options to subscribe for ordinary
shares or who, as a result of being granted an option under the Plan with
respect to such Offering Period, would own shares or hold options to subscribe
for shares possessing 5 percent or more of the total combined voting power or
value of all classes of stock or shares of the Company or any of its
Subsidiaries.
5. OFFERING DATES
The Offering Periods of the Plan (the "OFFERING PERIOD") shall be of
six (6) months duration commencing February 1 and August 1 of each year and
ending on July 31 and January 31 respectively. Notwithstanding the foregoing,
the first Offering Period shall commence on the date of the initial public
offering and shall end on the earlier of the first July 31 or January 31
thereafter (the "FIRST OFFERING PERIOD"). Payroll deductions of each
participant are accumulated under the Plan during the Offering Periods. The
first day of each Offering Period is referred to as the "Offering Date". The
last business day of each Offering Period is referred to as the "Purchase
Date". The Board shall have the power to change the duration of Offering
Periods with respect to future offerings without shareholder approval if such
change is announced at least fifteen (15) days prior to the scheduled beginning
of the first Offering Period to be affected.
2
<PAGE>
6. PARTICIPATION IN THE PLAN
Eligible employees may become participants in an Offering Period
under the Plan on the first Offering Date after satisfying the eligibility
requirements by delivering a subscription agreement to the Company's or
Subsidiary's (whichever employs such employee) payroll department (the "PAYROLL
Department") not later than five (5) days prior to such Offering Date unless a
later time for filing the subscription agreement authorizing payroll deductions
is set by the Board for all eligible employees with respect to a given Offering
Period. An eligible employee who does not deliver a subscription agreement to
the Payroll Department by such date after becoming eligible to participate in
such Offering Period shall not participate in that Offering Period or any
subsequent Offering Period unless such employee enrolls in the Plan by filing a
subscription agreement with the Payroll Department not later than five (5) days
prior to such subsequent Offering Date. Once an employee becomes a participant
in an Offering Period, such employee will automatically participate in the
Offering Period commencing immediately following the last day of the prior
Offering Period unless the employee withdraws from the Plan or terminates
further participation in the Offering Period as set forth in Section 11 below.
Such participant is not required to file any additional subscription agreement
in order to continue participation in the Plan.
7. GRANT OF OPTION ON ENROLLMENT
Enrollment by an eligible employee in the Plan with respect to an
Offering Period will constitute the grant (as of the Offering Date) by the
Company to such employee of an option to subscribe on the Purchase Date for up
to that number of ordinary shares of the Company determined by dividing the
amount accumulated in such employee's payroll deduction account during such
Offering Period, and if applicable, as converted into U.S. Dollars at the
Conversion Rate (as defined in Section 9(g)) on the Purchase Date, by the lower
of (i) eighty-five percent (85%) of the fair market value of an ordinary share
of the Company on the Offering Date (the "ENTRY PRICE") or (ii) eighty-five
percent (85%) of the fair market value of an ordinary share of the Company on
the Purchase Date; provided, however, that the number of ordinary shares of the
Company subject to any option granted pursuant to this Plan shall not exceed
the lesser of (a) the maximum number of shares set by the Board pursuant to
Section 10(c) below with respect to the applicable Offering Period, or (b) 200%
of the number of shares determined by using 85% of the fair market value of an
ordinary share of the Company on the Offering Date as the denominator. Fair
market value of an ordinary share of the Company shall be determined as
provided in Section 8 hereof.
8. PURCHASE PRICE
The purchase price of shares issued pursuant to this Plan shall be
payable in U.S. Dollars. The purchase price per share at which a share will be
issued in any Offering Period shall be 85 percent of the lesser of:
(a) The fair market value on the Offering Date; or
3
<PAGE>
(b) The fair market value on the Purchase Date.
Notwithstanding the foregoing, the purchase price per ordinary share shall not
in any circumstances be less than the U.S. Dollar equivalent, at the Conversion
Rate (as defined in Section 9(g)) on the Purchase Date, of 20p (being the par
value of an ordinary share).
For purposes of the Plan, the term "fair market value" on a given
date shall mean the fair market value of an ordinary share of the Company, or
instrument evidencing such ordinary shares (e.g., American Depositary Shares or
American Depositary Receipts) in U.S. Dollars, as determined by the Committee
from time to time in good faith. If a public market exists for the shares, or
instrument evidencing such ordinary shares (e.g., American Depositary Shares or
American Depositary Receipts), the fair market value shall be the average of
the last reported bid and asked prices for an ordinary share of the Company on
the last trading day prior to the date of determination, or, in the event
ordinary shares of the Company, or instruments evidencing such ordinary shares
(e.g., American Depositary Shares or American Depositary Receipts), are listed
on the Nasdaq National Market, the fair market value shall be the closing price
of a share, or instrument evidencing such ordinary shares (e.g., American
Depositary Shares or American Depositary Receipts), on the determination date
as quoted on the Nasdaq National Market or if no such reported sale takes place
on such date, the closing price on the next preceding trading date on which a
reported sale occurred. Notwithstanding the foregoing, the fair market value of
a share, or instrument evidencing such ordinary shares (e.g., American
Depositary Shares or American Depositary Receipts), on the First Offering Date
(which is the first business day of the First Offering Period under this Plan)
shall be the price per share at which such shares or instruments are initially
offered for sale to the public in the Company's initial public offering.
9. PAYMENT OF PURCHASE PRICE; CHANGES IN PAYROLL DEDUCTIONS; ISSUE OF SHARES
(a) The purchase price of the shares is accumulated by regular
payroll deductions made during each Offering Period. The deductions are made as
a percentage of the participant's compensation in one percent increments not
less than 2 percent nor greater than 10 percent, not to exceed $25,000 per
year, or the U.S. Dollar equivalent determined at the Conversion Rate (as
defined in Section 9(g)) on the Offering Date, or such lower limit set by the
Committee. Compensation for U.S. employees shall mean all W-2 compensation,
including, but not limited to base salary, wages, commissions, overtime, shift
premiums and bonuses, plus draws against commissions and excluding car
allowances and any other in kind employment related benefits; provided,
however, that for purposes of determining a participant's compensation, any
election by such participant to reduce his or her regular cash remuneration
under Sections 125 or 401(k) of the Code shall be treated as if the participant
did not make such election. Compensation for U.K. employees shall mean all
compensation, including, but not limited to base salary, wages, commissions,
overtime, the substantial equivalent of U.S. "shift premiums" and bonuses, plus
draws against commissions and excluding car allowances and any other in kind
employment related benefits. Payroll deductions shall commence on the first
payday following the Offering
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Date and shall continue to the end of the Offering Period unless sooner altered
or terminated as provided in the Plan.
(b) A participant may lower (but not increase) the rate of payroll
deductions during an Offering Period by filing with the Payroll Department a
new authorization for payroll deductions, in which case the new rate shall
become effective for the next payroll period commencing more than 15 days after
the Payroll Department's receipt of the authorization and shall continue for
the remainder of the Offering Period unless changed as described below. Such
change in the rate of payroll deductions may be made at any time during an
Offering Period, but not more than one change may be made effective during any
Offering Period. A participant may increase or decrease the rate of payroll
deductions for any subsequent Offering Period by filing with the Payroll
Department a new authorization for payroll deductions not later than five (5)
days prior to the beginning of such subsequent Offering Period.
(c) All payroll deductions made for a participant are credited to
his or her account under the Plan and are deposited with the general funds of
the Company. No interest accrues on the payroll deductions. All payroll
deductions received or held by the Company may be used by the Company for any
corporate purpose, and the Company shall not be obligated to segregate such
payroll deductions.
(d) On each Purchase Date, so long as the Plan remains in effect and
provided that the participant has not submitted a signed and completed
withdrawal form before that date, as set forth in Section 11 below, which
notifies the Company that the participant wishes to withdraw from that Offering
Period under the Plan and have all payroll deductions accumulated in the
account maintained on behalf of the participant as of that date returned to the
participant, the Company shall apply the funds, and if applicable, as converted
into U.S. Dollars at the Conversion Rate (as defined in Section 9(g)) on the
Purchase Date, then in the participant's account to the subscription for a
whole number of ordinary shares reserved under the option granted to such
participant with respect to the Offering Period to the extent that such option
is exercisable on the Purchase Date. The purchase price per share shall be as
specified in Section 8 of the Plan. Any cash remaining in a participant's
account after such subscription for ordinary shares shall be refunded to such
participant in cash, without interest; provided, however, that any amount
remaining in such participant's account on a Purchase Date which is less than
the amount necessary to subscribe for a single ordinary share shall be carried
forward, without interest, into the next Offering Period. In the event that the
Plan has been oversubscribed, all funds not used to subscribe for ordinary
shares on the Purchase Date shall be returned to the participant, without
interest. No ordinary shares shall be subscribed for on a Purchase Date on
behalf of any employee whose participation in the Plan has terminated prior to
such Purchase Date.
(e) As promptly as practicable after the Purchase Date, the Company
shall arrange the delivery to each participant of a certificate representing
the shares issued upon exercise of his option.
(f) During a participant's lifetime, such participant's option to
subscribe for shares hereunder is exercisable only by him or her. The
participant will have no interest or voting right
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<PAGE>
in shares covered by his or her option until such option has been exercised.
Shares to be delivered to a participant under the Plan will be registered in
the name of the participant or in the name of the participant and his or her
spouse.
(g) "Conversion Rate" means the average currency conversion rate
quoted by the Bank of America in London for converting Pounds Sterling into
U.S. Dollars.
10. LIMITATIONS ON SHARES TO BE PURCHASED
(a) No employee shall be entitled to subscribe for shares under the
Plan at a rate which, when aggregated with his or her rights to subscribe for
shares under all other employee stock purchase plans of the Company or any
Subsidiary, exceeds $25,000 (or if applicable, the U.S. Dollars equivalent
determined at the Conversion Rate (as defined in Section 9(g)) as of the
Offering Date) in fair market value, determined as of the Offering Date (or
such other limit as may be imposed by the Code) for each calendar year in which
the employee participates in the Plan.
(b) No more than 200% of the number of shares determined by using
85% of the fair market value of an ordinary share of the Company on the
Offering Date as the denominator may be subscribed for by a participant on any
single Purchase Date.
(c) No employee shall be entitled to subscribe for more than the
Maximum Share Amount (as defined below) on any single Purchase Date. Not less
than thirty days prior to the commencement of any Offering Period, the Board
may, in its sole discretion, set a maximum number of shares which may be
subscribed for by any employee at any single Purchase Date (hereinafter the
"MAXIMUM SHARE AMOUNT"). In no event shall the Maximum Share Amount exceed the
amounts permitted under Section 10(b) above. If a new Maximum Share Amount is
set, then all participants must be notified of such Maximum Share Amount not
less than fifteen days prior to the commencement of the next Offering Period.
Once the Maximum Share Amount is set, it shall continue to apply with respect
to all succeeding Purchase Dates and Offering Periods unless revised by the
Board as set forth above.
(d) If the number of shares to be subscribed for on a Purchase Date
by all employees participating in the Plan exceeds the number of shares then
available for issue under the Plan, the Company will make a pro rata allocation
of the remaining shares in as uniform a manner as shall be practicable and as
the Board shall determine to be equitable. In such event, the Company shall
give written notice of such reduction of the number of shares to be subscribed
for under a participant's option to each participant affected thereby.
(e) Any payroll deductions accumulated in a participant's account
which are not used to subscribe for ordinary shares due to the limitations in
this Section 10 shall be returned to the participant as soon as practicable
after the end of the Offering Period, without interest.
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11. WITHDRAWAL
(a) Each participant may withdraw from an Offering Period under the
Plan by signing and delivering to the Payroll Department notice on a form
provided for such purpose. Such withdrawal may be elected at any time at least
15 days prior to the end of an Offering Period.
(b) Upon withdrawal from the Plan, the accumulated payroll
deductions shall be returned to the withdrawn participant, without interest,
and his or her interest in the Plan shall terminate. In the event a participant
voluntarily elects to withdraw from the Plan, he or she may not resume his or
her participation in the Plan during the same Offering Period, but he or she
may participate in any Offering Period under the Plan which commences on a date
subsequent to such withdrawal by filing a new authorization for payroll
deductions in the same manner as set forth in Section 6 above for initial
participation in the Plan.
12. TERMINATION OF EMPLOYMENT
Termination of a participant's employment for any reason, including
retirement, death or the failure of a participant to remain an eligible
employee, immediately terminates his or her participation in the Plan. In such
event, the payroll deductions credited to the participant's account will be
returned to him or her or, in the case of his or her death, to his or her legal
representative, without interest. For purposes of this Section 12, an employee
will not be deemed to have terminated employment or failed to remain in the
continuous employ of the Company in the case of sick leave, military leave, or
any other leave of absence approved by the Board; provided that such leave is
for a period of not more than ninety (90) days or reemployment upon the
expiration of such leave is guaranteed by contract or statute.
13. RETURN OF PAYROLL DEDUCTIONS
In the event a participant's interest in the Plan is terminated by
withdrawal, termination of employment or otherwise, or in the event the Plan is
terminated by the Board, the Company shall promptly deliver to the participant
all payroll deductions credited to his account. No interest shall accrue on the
payroll deductions of a participant in the Plan.
14. CAPITAL CHANGES
Subject to any required action by the shareholders of the Company, the
number of ordinary shares covered by each option under the Plan which has not
yet been exercised and the number of ordinary shares which have been authorized
for issue under the Plan but have not yet been placed under option
(collectively, the "RESERVES"), as well as the price per ordinary share covered
by each option under the Plan which has not yet been exercised, shall be
proportionately adjusted for any increase or decrease in the number of issued
ordinary shares resulting from any consolidation or subdivision of ordinary
shares of the Company, or any bonus or other capitalization issue of ordinary
shares or any other increase or decrease in the number of issued ordinary
shares effected without receipt of consideration by the Company; provided,
however,
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<PAGE>
that conversion of any convertible securities of the Company shall not be
deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination shall be final,
binding and conclusive. Except as expressly provided herein, no issue by the
Company of shares of any class, or securities convertible into shares of any
class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of ordinary shares subject to an option.
In the event of the proposed dissolution or liquidation of the Company,
the Offering Period will terminate immediately prior to the consummation of
such proposed action, unless otherwise provided by the Board. The Board may, in
the exercise of its sole discretion in such instances, declare that the options
under the Plan shall terminate as of a date fixed by the Board and give each
participant the right to exercise his or her option as to all of the ordinary
shares comprised in the option, including shares in respect of which the option
would not otherwise be exercisable. In the event of a proposed sale of all or
substantially all of the assets of the Company, or the sale of the entire share
capital of the Company to another corporation, (whether for consideration in
cash or in the form of securities of any kind) (a "merger"), each option under
the Plan shall be assumed or an equivalent option shall be substituted by the
purchasing corporation or a parent or subsidiary of such purchasing
corporation, unless the Board determines, in the exercise of its sole
discretion and in lieu of such assumption or substitution, that the participant
shall have the right to exercise the option as to all of the ordinary shares
comprised in the option. If the Board makes an option exercisable in lieu
of assumption or substitution in the event of a merger or sale of assets, the
Board shall notify the participant that the option shall be fully exercisable
for a period of twenty (20) days from the date of such notice, and the option
will terminate upon the expiration of such period.
The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the
price per ordinary share comprised in each outstanding option, in the event
that the Company effects one or more reorganizations, recapitalizations, rights
offerings or other increases or reductions of share capital, or in the event of
a merger.
15. NONASSIGNABILITY
Neither payroll deductions credited to a participant's account nor any
rights with regard to the exercise of an option or to receive shares under the
Plan may be assigned, transferred, pledged or otherwise disposed of in any way
(other than by will, the laws of descent and distribution or as provided in
Section 22 hereof) by the participant. Any such attempt at assignment,
transfer, pledge or other disposition shall be without effect.
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16. REPORTS
Individual accounts will be maintained for each participant in the Plan.
Each participant shall receive promptly after the end of each Offering Period a
report of his or her account setting forth the total payroll deductions
accumulated (and if applicable, the Conversion Rate (as defined in Section
9(g)) at which such participant's payroll deductions were converted into U.S.
Dollars), the number of shares subscribed for, the per share price thereof and
the remaining cash balance, if any, carried forward to the next Offering Period.
17. NOTICE OF DISPOSITION
Each participant shall notify the Company if the participant disposes of
any of the shares subscribed for in any Offering Period pursuant to this Plan
if such disposition occurs within two years from the Offering Date or within
one year from the Purchase Date on which such shares were subscribed for (the
"NOTICE PERIOD"). Unless such participant is disposing of any of such shares
during the Notice Period, such participant shall keep the certificates
representing such shares in his or her name (and not in the name of a nominee)
during the Notice Period. The Company may, at any time during the Notice
Period, place a legend or legends on any certificate representing shares
acquired pursuant to the Plan requesting the Company's transfer agent to notify
the Company of any transfer of the shares. The obligation of the participant to
provide such notice shall continue notwithstanding the placement of any such
legend on the certificates.
18. NO RIGHTS TO CONTINUED EMPLOYMENT
(a) Neither this Plan nor the grant of any option hereunder shall
confer any right on any employee to remain in the employ of the Company or any
Subsidiary, or restrict the right of the Company or any Subsidiary to terminate
such employee's employment.
(b) In the event that any person holding an option under the Plan
ceases to be employed by the Company or a Subsidiary for whatever reason, he
shall have no right to any compensation in respect of the loss of his right to
receive shares under this Plan.
19. EQUAL RIGHTS AND PRIVILEGES
All eligible employees shall have equal rights and privileges with
respect to the Plan so that the Plan qualifies as an "employee stock purchase
plan" within the meaning of Section 423 or any successor provision of the Code
and the related regulations. Any provision of the Plan which is inconsistent
with Section 423 or any successor provision of the Code shall, without further
act or amendment by the Company or the Board, be reformed to comply with the
requirements of Section 423. This Section 19 shall take precedence over all
other provisions in the Plan.
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20. NOTICES
All notices or other communications by a participant to the Company
under or in connection with the Plan shall be deemed to have been duly given
when received in the form specified by the Company at the location, or by the
person, designated by the Company for the receipt thereof.
21. TERM; SHAREHOLDER APPROVAL
This Plan shall become effective at such date and time as the
Registration Statement filed with the Securities and Exchange Commission
relating to the Company's securities is declared effective (and then only
provided that the initial public offering later closes). This Plan shall be
approved by the shareholders of the Company, in any manner permitted by
applicable corporate law, within twelve months before or after the date this
Plan is adopted by the Board. No subscription for shares pursuant to the Plan
shall occur prior to such shareholder approval. Thereafter, no later than
twelve (12) months after the Company becomes subject to Section 16(b) of the
Exchange Act, the Company will comply with the requirements of Rule 16b-3 with
respect to shareholder approval. The Plan shall continue until the earlier to
occur of termination by the Board, issue of all of the ordinary shares reserved
for issue under the Plan, or ten (10) years from the adoption of the Plan by
the Board.
22. DESIGNATION OF BENEFICIARY
(a) A participant may file a written designation of a beneficiary
who is to receive any shares and cash, if any, from the participant's account
under the Plan in the event of such participant's death subsequent to the end
of an Offering Period but prior to delivery to him of such shares and cash. In
addition, a participant may file a written designation of a beneficiary who is
to receive any cash from the participant's account under the Plan in the event
of such participant's death prior to a Purchase Date.
(b) Such designation of beneficiary may be changed by the
participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares or cash to the executor or administrator of the estate of
the participant, or if no such executor or administrator has been appointed (to
the knowledge of the Company), the Company, in its discretion, may deliver such
shares or cash to the spouse or to any one or more dependents or relatives of
the participant, or if no spouse, dependent or relative is known to the
Company, then to such other person as the Company may designate.
23. CONDITIONS UPON ISSUE OF SHARES; LIMITATION ON SALE OF SHARES
Shares shall not be issued with respect to an option unless the exercise
of such option and the issue and delivery of such shares pursuant thereto shall
comply with all applicable provisions of law, domestic or foreign, including,
without limitation, the Securities Act of 1933, as
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<PAGE>
amended, the Exchange Act, the rules and regulations promulgated thereunder,
and the requirements of any stock exchange upon which the shares may then be
listed, and shall be further subject to the approval of counsel for the Company
with respect to such compliance.
24. AMENDMENT OR TERMINATION OF THE PLAN
The Board may at any time amend, terminate or extend the term of the
Plan, except that any such termination cannot affect options previously granted
under the Plan, nor may any amendment make any change in an option previously
granted which would adversely affect the right of any participant, nor may any
amendment be made without approval of the shareholders of the Company obtained
in accordance with Section 21 hereof within 12 months of the adoption of such
amendment (or earlier if required by Section 21) if such amendment would:
(a) increase the number of shares that may be issued under the Plan;
(b) change the designation of the employees (or class of employees)
eligible for participation in the Plan; or
(c) constitute an amendment for which shareholder approval is
required in order to comply with Rule 16b-3 (or any successor rule) of the
Exchange Act.
25. GOVERNING LAW
The Plan and all agreements, documents and instruments entered into
pursuant to the Plan shall be governed by and construed in accordance with the
internal laws of the State of California, excluding that body of law pertaining
to conflict of laws.
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Insignia Solutions plc
Kingsmead Business Park
London Road
High Wycombe
Buckinghamshire
HP11 1JU Our Ref: KDT/WD/513239
12 April 2000
Dear Sirs
INSIGNIA SOLUTIONS PLC, FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
<TABLE>
<S> <C>
1 This Opinion is given in connection with the registration
under the Securities Act of 1933, as amended (the "Securities
Act"), of
1.1 an additional 750,000 Ordinary Shares of 20p nominal value
each (each a "SHARE") in Insignia Solutions plc ("the
Company"), which may be issued pursuant to the Company's U.K.
Employee Share Option Scheme 1996, as amended ("the 1996
Scheme") and the 1995 Incentive Stock Option Plan for U.S.
Employees ("the 1995 Plan"); and
1.2 an additional 375,000 Shares which may be issued pursuant to
the Company's 1995 Employee Share Purchase Plan, as amended,
("the Purchase Plan")
under the terms of a form S8 Registration Statement a copy of
which has been provided to us ("the Registration Statement").
2 We have acted as English legal advisers to the Company in
connection with the foregoing. In so acting, we have examined
such certificates of the Company and directors and/or officers
thereof and originals or copies of all such corporate
documents and records of the Company and all such other
documents as we have deemed relevant and necessary as a basis
for our Opinion hereinafter set forth. We have relied upon
such certificates of directors and/or officers of the Company
and upon statements and information furnished by directors
and/or officers of the Company with respect to the accuracy of
material factual matters contained therein. We have also
assumed the genuineness of all signatures thereon or on the
originals of documents referred to therein.
<PAGE>
3 This Opinion is limited to English law as currently applied by
the English Courts and is given on the basis that it will be
governed by and be construed in accordance with current
English law.
4 It is our opinion that the additional 1,125,000 Shares that
may be issued upon the exercise of:-
4.1 options granted or to be granted under the 1996 Scheme;
4.2 options granted or to be granted under the 1995 Plan; and
4.3 purchase rights granted or to be granted under the Purchase
Plan
when issued in accordance with the applicable scheme or plan
and/or options or purchase rights duly granted thereunder and
the Company's Memorandum and Articles of Association, will be
legally issued, fully paid and non-assessable.
5 For the purpose of this Opinion we have assumed that the term
"non-assessable" in relation to the Shares means under English
law that holders of such Shares having fully paid up all
amounts due on such Shares as to the nominal amount and
premium thereon, are under no further personal liability to
contribute to the assets or liabilities of the Company in
their capacities purely as holders of such Shares.
</TABLE>
This Opinion is given to you solely for your benefit and for the purpose of
the Registration Statement. It is not to be transmitted to any other person
nor is to be relied upon by any other person or for any purpose or quoted or
referred to in any public document without our prior written consent except
that we consent to the use of this Opinion as an exhibit to the Registration
Statement and further consent to the references to us in the Registration
Statement. In giving this consent, we do not admit that we are in the category
of persons whose consent is required under Section 7 of the Securities Act or
the Rules and Regulations thereunder.
Yours faithfully
/s/ Macfarlanes
<PAGE>
EXHIBIT 23.02
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 20, 2000, except Note 13
which is dated as of March 21, 2000 relating to the financial statements and
financial statement schedule, which appears in Insignia Solutions plc Annual
Report on Form 10-K for the year ended December 31, 1999.
/s/ PricewaterhouseCoopers LLP
San Jose, CA
April 11, 2000
