<PAGE>
As filed with the Securities and Exchange Commission on June 29, 1998
Registration No. 333-___________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
GALILEO TECHNOLOGY LTD.
(Exact Name of Registrant as Specified in Its Charter)
Israel Not Applicable
------------------------------- -------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
Moshav Manof, D.N. Misgav, Israel 20184
--------------------------------------- -----------
(Address of Principal Executive Offices) (Zip Code)
GALILEO TECHNOLOGY LTD. 1997 EMPLOYEE STOCK PURCHASE PLAN
- -------------------------------------------------------------------------------
(Full Title of Plan)
Manuel Alba
President
Galileo Technology Inc.
142 Charcot Avenue
San Jose, California 95131
--------------------------------
(Name and Address of Agent For Service)
(408) 367-1400
--------------
(Telephone Number, Including Area Code, of Agent For Service)
Copy to: Lior O. Nuchi
McCutchen, Doyle, Brown & Enersen, LLP
3150 Porter Drive
Palo Alto, California 94304-1212
(650) 849-4400
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================================
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share (1) Price (1) Fee
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ordinary Shares, NIS 0.01 Nominal
Value 100,000 $9.94 $994,000 $293.23
================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee on
the basis of the average of the high and low prices as reported on the
Nasdaq National Market System on June 23, 1998.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed or to be filed with the Commission by the
Registrant are incorporated by reference in this Registration Statement:
(a) Registrant's latest Annual Report on Form 20-F for the fiscal year
ended December 31, 1997 filed pursuant to Section 13(a) or 15(d) of the
Securities Act of 1934, as amended (the "EXCHANGE ACT").
(b) Registrant's Quarterly Report on Form 6-K for the quarter ended March
31, 1998, filed on May 27, 1998 with the Commission.
(c) The description of the Ordinary Shares of the Registrant contained in
the Registrant's Registration Statement on Form 8-A filed on July 25, 1997.
In addition, 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 offered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference in this registration statement and to
be part thereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Yesha Primes, a member of Primes, Shiloh, Givon & Co., holds 360,000
shares of the Registrant in trust for certain key employees.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Articles of Association provide that the Registrant will indemnify
any Office Holder of the Registrant as defined in the Companies Ordinance out of
the assets of the Registrant against all liabilities incurred in good faith by
such Office Holder in the line of his duties for the Registrant or related
thereto. Such indemnification is subject to limitation by Israeli law and the
Articles of Association.
The Registrant has entered into separate indemnification agreements with
all its directors and officers. These agreements would require the Registrant,
among other things, to indemnify such directors and officers against certain
liabilities that may arise by reason of their status or service as directors and
officers (other than liabilities arising from willful misconduct of culpable
nature) and to advance expenses, in certain circumstances, incurred as a result
of any proceeding against them as to
2
<PAGE>
which they could be indemnified and to obtain directors' and officers' insurance
if available on reasonable terms.
Christopher J. Schaepe, a director of the Registrant and General Partner
of WPG Venture Partners III, L.P., which is the General Partner of Weiss, Peck &
Greer Venture Associates III, L.P. and WPG Enterprise Fund II, L.P. (both of
which are or were shareholders of the Registrant), is indemnified in his role as
a director of the Registrant pursuant to the terms of his respective partnership
agreements with the above entities.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
See Index to Exhibits.
ITEM 9. UNDERTAKINGS.
(a) 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 and 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 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;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
-----------------
registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports
3
<PAGE>
filed by the Registrant pursuant to Section 13 or 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.
(b) 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 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.
(c) 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 described in Item 6, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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.
4
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933, as amended,
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 San Jose, state of California, on this 25th day
of June, 1998.
GALILEO TECHNOLOGY, LTD.
By: /s/ George A. Hervey
--------------------
George A. Hervey
Chief Financial Officer
5
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints George A. Hervey true and lawful
attorney-in-fact and agent for such person on his behalf and in such person's
name, place and stead, and in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this Registration Statement
on Form S-8 and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent 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 in order to effectuate the same as fully, to all intents and purposes,
as he himself might or could do if personally present, hereby ratifying and
confirming all that said attorney-in-fact and agent may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement on Form S-8 has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
NAME Title Date
- --------------------------------- --------------------------------- -------------------------
<S> <C> <C>
/s/ Avigdor Willenz Chief Executive Officer June 25, 1998
- --------------------------------- (Principal Executive Officer)
Avigdor Willenz and Director
/s/ George A. Hervey Chief Financial Officer June 25, 1998
- --------------------------------- (Principal Financial Officer)
George A. Hervey
/s/ Shoulamit Uzan Financial Controller June 25, 1998
-------------------------------- (Principal Accounting Officer)
Shoulamit Uzan
/s/ Manuel Alba President of GTI and Director June 25, 1998
- ---------------------------------
Manuel Alba
/s/ Matty Karp Director June 25, 1998
- ---------------------------------
Matty Karp
/s/ Christopher J. Schaepe Director June 25, 1998
- ---------------------------------
Christopher J. Schaepe
</TABLE>
6
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Exhibit
------ -------
5.1 Opinion regarding legality of securities to be offered
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Primes, Shiloh, Givon & Co.
(See Exhibit 5.1)
24.1 Power of Attorney (See page 6)
99.1 Galileo Technology Ltd. 1997 Employee Stock Purchase Plan
<PAGE>
EXHIBIT 5.1
[LETTERHEAD OF PRIMES, SHILOH, GIVON & CO., LAW OFFICE APPEARS HERE]
REF: G/115/2
June 24, 1998
Galileo Technology Ltd.
c/o Galileo Technology Inc.
1735 North First Street, #308
San Jose, CA 95112
U.S.A.
- ------
REGISTRATION STATEMENT ON FORM S-8
Gentlemen:
With reference to the Registration Statement on Form S-8 to be filed by Galileo
Technology Ltd., an Israeli corporation (the "Company"), with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, related to
100,000 Ordinary Shares of the Company issuable pursuant to the Company's 1997
Employees' Stock Purchase Plan (the "Purchase Plan"), it is our opinion that
such Ordinary Shares of the Company (provided that they are not offered to the
public in Israel), when issued, sold and fully paid for in accordance with the
Purchase Plan, will be legally issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion with the Securities and Exchange
Commission as Exhibit 5.1 to the Registration Statement.
Very truly yours,
/s/ Y. PRIMES
--------------------------
Y. Primes, Advocate
Primes, Shiloh, Givon & Co.
Law Office
YP/rh
G/115/2/29-2
<PAGE>
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Galileo Technology Ltd. 1997 Employee Stock Purchase Plan
of our report dated January 20, 1998, with respect to the consolidated financial
statements and schedule of Galileo Technology Ltd. included in its Annual Report
(Form 20-F) for the year ended December 31, 1997, filed with the Securities and
Exchange Commission.
/s/ ERNST & YOUNG
Palo Alto, California
June 25, 1998
<PAGE>
EXHIBIT 99.1
GALILEO TECHNOLOGY LTD.
1997 EMPLOYEE STOCK PURCHASE PLAN
(As Adopted and Effective as of October 6, 1997)
SECTION 1. ESTABLISHMENT OF THE PLAN.
The Galileo Technology Ltd. qualified 1997 Employee Stock Purchase
Plan (the "Plan") was established to provide Eligible Employees with an
opportunity to purchase the Company's Ordinary Shares so that they may increase
their proprietary interest in the success of the Company. The Plan, which
provides for the purchase of stock through payroll withholding, is intended to
qualify under Section 423 of the Code.
SECTION 2. DEFINITIONS.
(a) "Board of Directors" or "Board" means the Board of Directors of
the Company, or an authorized committee of the Board.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
(c) "Company" means Galileo Technology Ltd., a corporation formed
under the laws of the State of Israel.
(d) "Compensation" means the base compensation paid to a Participant
in cash or in kind, including overtime and shift differential. Incentive
compensation, commissions and other bonuses and other forms of compensation for
work outside the regular work schedule are excluded.
(e) "Eligible Employee" means any Employee of a Participating Company
(i) who is employed by the Participating Company on or prior to the Offering
Date, (ii) who is customarily employed for more than 20 hours per week, and
(iii) who is customarily employed for more than five months per calendar year.
In the event an Eligible Employee fails to remain in the continuous
employ of a Participating Company customarily for at least 20 hours per week
during an Offering Period, he or she will be deemed to have elected to withdraw
from the Plan and the payroll deductions credited to his or her account will be
returned to him or her; provided that a Participant who goes on an unpaid leave
of absence shall be permitted to remain in the Plan with respect to an Offering
Period which commenced prior to such leave of absence. If such Participant is
not guaranteed reemployment by contract or statute and the leave of absence
extends beyond 90 days, such Participant shall be deemed to have terminated
employment on the 91st day of such leave of absence. Payroll deductions for a
Participant who has been on an unpaid leave of absence will resume at the same
rate as in effect prior to such leave upon return to work unless changed by such
Participant or unless the Participant has been on an unpaid leave of absence
either throughout an entire Offering Period or for more than 90 days, in which
case the Participant shall not be permitted to re-enter the Plan until a
participation agreement is filed with respect to a subsequent Offering Period
that commences after such Participant has returned to work from the unpaid leave
of absence.
1
<PAGE>
(f) "Employee" means any common-law employee of a Participating
Company.
(g) "Fair Market Value" shall mean (i) the closing price of an
Ordinary Share on the principal exchange on which the Ordinary Shares are
trading, or (ii) if the Ordinary Shares are not traded on an exchange but are
quoted on the Nasdaq National Market or a successor quotation system, the
closing price on the Nasdaq National Market or such successor quotation system,
or (iii) if the Ordinary Shares are not traded on an exchange or quoted on the
Nasdaq National Market or a successor quotation system, the fair market value of
an Ordinary Share as determined by the Plan Administrator in good faith. Such
determination shall be conclusive and binding on all persons.
(h) "Offering Date" means the first day of an Offering Period.
(i) "Offering Period" means a period during which contributions may be
made toward the purchase of Ordinary Shares under the Plan, as determined
pursuant to Section 6.
(j) "Ordinary Shares" means the Ordinary Shares, par value NIS 0.01,
of the Company.
(k) "Participant" means an Eligible Employee who elects to participate
in the Plan, as provided in Section 5.
(l) "Participating Company" means the Company and such present or
future Subsidiaries of the Company as the Board of Directors shall from time to
time designate.
(m) "Plan Account" means the account established for each Participant
pursuant to Section 9(a).
(n) "Plan Administrator" means the administrator appointed by the
Board pursuant to Section 4.
(o) "Purchase Price" means the price at which Participants may
purchase Ordinary Shares under Section 5 of the Plan, as determined pursuant to
Section 7.
(p) "Purchase Date" means the last day of each Purchase Period.
(q) "Purchase Period" means a period commencing on the Offering Date
or on the day after a Purchase Date and ending on a Purchase Date, as described
in Section 6.
(r) "Subsidiary" means a subsidiary corporation as defined in Section
424 of the Code.
SECTION 3. SHARES AUTHORIZED.
The maximum aggregate number of Ordinary Shares that may be offered
under the Plan shall be 100,000 subject to adjustment as provided in Section 14.
2
<PAGE>
SECTION 4. ADMINISTRATION.
(a) The Plan shall be administered by a Plan Administrator appointed
by the Board of Directors. The interpretation and construction by the Plan
Administrator of any provision of the Plan or of any right to purchase Ordinary
Shares hereunder shall be conclusive and binding on all persons.
(b) No member of the Board or the Plan Administrator shall be liable
for any action or determination made in good faith with respect to the Plan or
the right to purchase Ordinary Shares hereunder. The Plan Administrator shall
be indemnified by the Company against the reasonable expenses, including
attorney's fees, actually and necessarily incurred in connection with the
defense of any action, suit or proceeding, or in connection with any appeal
therein, to which it may be a party by reason of any action taken or failure to
act under or in connection with the Plan or any stock purchased thereunder, and
against all amounts paid by it in settlement thereof (provided such settlement
is approved by independent legal counsel selected by the Company) or paid by it
in satisfaction of a judgment in any such action, suit or proceeding, except in
relation to matters as to which it shall be adjudged in such action, suit or
proceeding that the Plan Administrator is liable for negligence or misconduct in
the performance of its duties; provided that within 60 days after institution of
any such action, suit or proceeding, the Plan Administrator shall in writing
offer the Company the opportunity, at the Company's own expense, to handle and
defend the same.
(c) All costs and expenses incurred in administering the Plan shall be
paid by the Company. The Board or the Plan Administrator may request advice for
assistance or employ such other persons as are necessary for proper
administration of the Plan.
SECTION 5. ELIGIBILITY AND PARTICIPATION.
(a) Any person who qualifies or will qualify as an Eligible Employee
on the Offering Date with respect to an Offering Period may elect to participate
in the Plan for such Offering Period. An Eligible Employee may elect to
participate by executing the participation agreement prescribed for such purpose
by the Plan Administrator. The participation agreement shall be filed with the
Plan Administrator no later than two weeks prior to the applicable Offering Date
or such other deadline as is prescribed by the Plan Administrator. The Eligible
Employee shall designate in the participation agreement the percentage of his or
her Compensation which he or she elects to have withheld for the purchase of
Ordinary Shares, which may be any percentage of the Participant's Compensation
up to a maximum of ten percent. In the event that the Fair Market Value of
Ordinary Shares on the last trading day before the commencement of the Offering
Period in which the Participant is enrolled is higher than on the last trading
day before the commencement of any subsequent Offering Period, the Participant
shall automatically be re-enrolled for such subsequent Offering Period, unless
the Participant elects to remain in the current Offering Period by delivering a
written notice, in form satisfactory to the Board, to the Plan Administrator.
When a Participant reaches the end of an Offering Period but his or her
participation is to continue, then such Participant shall automatically be re-
enrolled for the Offering Period that commences immediately after the end of the
prior Offering Period.
(b) By enrolling in the Plan, a Participant shall be deemed to have
elected to purchase the maximum number of whole Ordinary Shares that can be
purchased with the amount of the Participant's Compensation which is withheld
during each Purchase Period. However, with respect to any Purchase Period, no
Participant shall be eligible to purchase more than 500 Ordinary Shares
(appropriately
3
<PAGE>
adjusted if the Purchase Period is shorter or longer than six months and for
events described in Section 14), provided that such amount shall not result in
the limitations set forth in Section 15 being exceeded.
(c) Once enrolled, a Participant will continue to participate in the
Plan for each succeeding Purchase and Offering Period until he or she terminates
participation or ceases to qualify as an Eligible Employee. A Participant who
withdraws from the Plan in accordance with Section 10 may again become a
Participant, if he or she then is an Eligible Employee, by following the
procedure described in Section 5(a).
SECTION 6. OFFERING AND PURCHASE PERIODS.
The Plan shall be implemented by one or more Offering Periods of not
more than 24 months each. (The current duration of each Offering Period is two
years commencing on January 1, 1998 and on each six-month anniversary of January
1, 1998.) The Board of Directors may determine the duration of each Offering
Period and the commencement dates. The Board may determine to include one or
more Purchase Periods within an Offering Period. (Currently, each Offering
Period shall contain four Purchase Periods commencing on each January 1 and July
1 during an Offering Period.)
SECTION 7. PURCHASE PRICE.
The Purchase Price for each Ordinary Share shall be the lesser of (i)
85% of the Fair Market Value of such Ordinary Share on the last trading day
before the Offering Date or (ii) 85% of the Fair Market Value of such Ordinary
Share on the last trading day of the applicable Purchase Period.
SECTION 8. EMPLOYEE CONTRIBUTIONS.
A Participant may purchase Ordinary Shares under the Plan solely by
means of payroll deductions. Payroll deductions, as designated by the
Participant pursuant to Section 5(a), shall commence with the first paycheck
issued during the Offering Period and shall be deducted from each subsequent
paycheck throughout the Offering Period. If a Participant desires to change the
rate of payroll withholding during the Offering Period, he or she may do so, if
permitted by the Plan Administrator, only one time during an Offering Period by
filing a new participation agreement with the Plan Administrator. Such a change
may be either an increase or a decrease and will be effective no later than the
first day of the second payroll period which begins following the receipt of the
new participation agreement. If a Participant desires to increase or decrease
the rate of payroll withholding more than one time during the participation
period, he or she may do so effective for the next Offering Period by filing a
new participation agreement with the Plan Administrator on or before the date
specified by the Plan Administrator, and if none is stated, then no later than
the first day of the Offering Period for which such change is to be effective.
4
<PAGE>
SECTION 9. PLAN ACCOUNTS; PURCHASE OF SHARES.
(a) The Company will maintain a Plan Account on its books in the name
of each Participant. At the close of each pay period, the amount deducted from
the Participant's Compensation will be credited to the Participant's Plan
Account.
(b) As of the last day of each Purchase Period, the amount then in the
Participant's Plan Account will be divided by the Purchase Price, and the number
of whole shares which results (subject to the limitations described in Sections
5(b), 9(c) and 15) shall be purchased from the Company with the funds in the
Participant's Plan Account. Foreign currencies will be converted to U.S.
dollars based on the foreign currency exchange rate as quoted in the Wall Street
---- ------
Journal on the Purchase Date, or such other reasonable method selected by the
- -------
Plan Administrator that does not prevent the Plan from satisfying the
requirements of Section 423 of the Code. Share certificates representing the
number of Ordinary Shares so purchased shall be delivered to a brokerage account
designated by the Plan Administrator and kept in such account pursuant to a
participation agreement between each Participant and the Company and subject to
the conditions described therein, which may include a requirement that Ordinary
Shares be held and not sold for certain time periods.
(c) In the event that the aggregate number of Ordinary Shares that all
Participants elect to purchase during a Purchase Period shall exceed the number
of shares remaining available for issuance under the Plan, then the number of
shares to which each Participant shall become entitled shall be determined by
multiplying the number of shares available for issuance by a fraction, the
numerator of which is the sum of the number of shares the Participant has
elected to purchase during that Purchase Period pursuant to Section 5, and the
denominator of which is the sum of the number of shares which all employees have
elected to purchase during that Purchase Period pursuant to Section 5. Any cash
amount remaining in the Participant's Plan Account under these circumstances
shall be refunded to the Participant.
(d) Any amount remaining in the Participant's Plan Account caused by a
surplus due to fractional shares after deducting the amount of the Purchase
Price for the number of whole shares issued to the Participant shall be carried
over in the Participant's Plan Account for the succeeding Purchase Period,
without interest. Any amount remaining in the Participant's Plan Account caused
by anything other than a surplus due to fractional shares shall be refunded to
the Participant in cash, without interest.
(e) As soon as practicable following the end of each Purchase Period,
the Company shall deliver to each Participant a Plan Account statement setting
forth the amount of payroll deductions, the Purchase Price, the number of shares
purchased and the remaining cash balance, if any.
SECTION 10. WITHDRAWAL FROM THE PLAN.
A Participant may elect to withdraw from participation in a Purchase
Period at any time up to the last day of the Purchase Period by filing the
prescribed form with the Plan Administrator. A Participant may elect to
withdraw (or not withdraw) from participation in an Offering Period at any time
up to the last day of the Offering Period by filing the prescribed form with the
Plan Administrator. As soon as practicable after a withdrawal, payroll
deductions shall cease and all amounts credited to the Participant's Plan
Account will be refunded in cash, without interest. A Participant who has
5
<PAGE>
withdrawn from an Offering Period shall not be a Participant in future Offering
Periods, unless he or she again enrolls in accordance with the provisions of
Section 5.
SECTION 11. TAXES.
The Participant shall make such arrangements as the Company may
require for the satisfaction of any federal, state, local or foreign tax
obligations that may arise in connection with the disposition of the Ordinary
Shares acquired under the Plan. These arrangements may include withholding (or
tendering back) of Ordinary Shares, or withholding amounts from the
Participant's compensation.
SECTION 12. EFFECT OF TERMINATION OF EMPLOYMENT OR DEATH.
(a) Termination of employment as an Eligible Employee for any reason,
including death, shall be treated as an automatic withdrawal from the Plan under
Section 10. A transfer from one Participating Company to another shall not be
treated as a termination of employment.
(b) A Participant may file a written designation of a beneficiary who
is to receive any cash from the Participant's Plan Account in the event of such
Participant's death prior to the last day of an Offering Period. A Participant
may also file a written designation of a beneficiary who is to receive any cash,
if any, from the Participant's Plan Account in the event of such Participant's
death subsequent to the purchase of shares but prior to delivery to him or her
of such shares and cash.
(c) A designation of beneficiary may be changed by the Participant at
any time by written notice. In the event of the death of a Participant in the
absence of a valid designation of a beneficiary who is living at the time of
such Participant's death, the Company shall deliver such cash and/or shares in
accordance with the Participant's designation of beneficiaries under the
[GALILEO TECHNOLOGY LTD. 401(K) PLAN]; or, in the absence of such designation,
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 cash and/or shares 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.
SECTION 13. RIGHTS NOT TRANSFERABLE.
The rights or interests of any Participant in the Plan, or in any
Ordinary Shares or money to which he or she may be entitled under the Plan,
shall not be transferable by voluntary or involuntary assignment or by operation
of law, or by any other manner other than as permitted by the Code or by will or
the laws of descent and distribution. If a Participant attempts to transfer,
assign or otherwise encumber his or her rights or interest under the Plan, other
than as permitted by the Code or by will or the laws of descent and
distribution, such act shall be treated as an automatic withdrawal under Section
10.
6
<PAGE>
SECTION 14. RECAPITALIZATION, ETC.
(a) The aggregate number of Ordinary Shares offered under the Plan,
the number and price of shares which any Participant has elected to purchase
pursuant to Section 5 and the maximum number of shares which a Participant may
elect to purchase under the Plan in any Offering Period shall be proportionately
adjusted for any increase or decrease in the number of issued Ordinary Shares
resulting from a subdivision or consolidation of shares or any other capital
adjustment, the payment of a stock dividend, or other increase or decrease in
such shares effected without receipt of consideration by the Company.
(b) In the event of a dissolution or liquidation of the Company, or a
merger or consolidation to which the Company is a constituent corporation, this
Plan shall terminate unless the plan of merger, consolidation or reorganization
provides otherwise, and all amounts paid by each Participant toward the Purchase
Price of Ordinary Shares hereunder shall be refunded, without interest.
(c) The Plan shall in no event be construed to restrict in any way the
Company's right to undertake a dissolution, liquidation, merger, consolidation
or other reorganization.
SECTION 15. LIMITATION ON STOCK OWNERSHIP.
Notwithstanding any provision herein to the contrary, no Participant
shall be permitted to elect to participate in the Plan (i) if such Participant,
immediately after his or her election to participate, would own stock possessing
five percent or more of the total combined voting power or value of all classes
of stock of the Company or any parent or Subsidiary of the Company, or (ii) if
under the terms of the Plan the right of the Employee to purchase Ordinary
Shares under this Plan and all other qualified employee stock purchase plans of
the Company or its Subsidiaries would accrue at a rate that exceeds $25,000 of
the Fair Market Value of such Ordinary Shares (determined at the time such right
is granted) for each calendar year for which such right is outstanding at any
time. For purposes of this Section 15, ownership of stock shall be determined
by the attribution rules of Section 424(d) of the Code, and Participants shall
be considered to own any Ordinary Shares which they have a right to purchase
under this or any other stock plan.
SECTION 16. NO RIGHTS AS AN EMPLOYEE.
Nothing in the Plan shall be construed to give any person the right to
remain in the employ of a Participating Company. Each Participating Company
reserves the right to terminate the employment of any person at any time and for
any reason.
SECTION 17. RIGHTS AS A SHAREHOLDER.
A Participant shall have no rights as a shareholder with respect to
any shares he or she may have a right to purchase under the Plan until the date
of issuance of a stock certificate to the brokerage account designated by the
Plan Administrator for Ordinary Shares issued pursuant to the Plan.
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SECTION 18. USE OF FUNDS.
All payroll deductions received or held by the Company under the Plan
may be used by the Company for any corporate purpose, and the Company shall not
be obligated to segregate such payroll deductions in separate accounts.
SECTION 19. AMENDMENT OR TERMINATION OF THE PLAN.
The Board of Directors shall have the right to amend, modify or
terminate the Plan at any time without notice. An amendment of the Plan shall
be subject to shareholder approval only to the extent required by applicable
laws, regulations or rules. Amendments to the Plan to comply with the
requirements of a foreign country may be adopted by the Plan Administrator to
the extent those amendments do not prevent the Plan from satisfying the
requirements of Section 423 of the Code.
SECTION 20. GOVERNING LAW.
The Plan shall be governed by, and construed and interpreted in
accordance with, the laws of the State of California.
****
Approved by the Board of Directors on October 6, 1997.
Approved by the Shareholders of the Company on January 5, 1998.
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