<PAGE>
As filed with the Securities and Exchange Commission on April 21, 1999
Registration No. _______
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 21,310 $22.94 $488,851.40 $135.90
Value
=========================================================================================
</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 April 20, 1999.
<PAGE>
EXPLANATORY NOTE
Registrant previously filed (i) a Registration Statement on Form S-8 (No.
333-57967) on June 29, 1998, covering 100,000 Ordinary Shares issuable under
Registrant's 1997 Employees' Stock Purchase Plan ("Plan"). This Registration
Statement on Form S-8 is filed pursuant to Rule 413 and is made for the purpose
of registering an additional 21,310 shares of the same class of securities
previously registered under the above-referenced Registration Statement, which
shares are issuable beginning January 1, 1999 pursuant to the Plan which
provides an automatic annual increase in the number of shares that may be issued
under such Plan.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
In accordance with General Instruction E, entitled "Registration of
Additional Securities," to Form S-8 and because the purpose of this Registration
Statement is to register 21,310 additional securities of the same class as other
securities for which registration statements filed on Form S-8 related to the
same employee benefit plans are effective, the contents of the Registration
Statement on Form S-8 (No. 333-57967) filed by Registrant on June 29, 1998,
covering 100,000 Ordinary Shares issuable under Registrant's 1997 Employees'
Stock Purchase Plan ("Plan"), are incorporated by reference.
In addition, 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, 1998 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
September 30, 1998, filed on November 24, 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 180,000
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
<PAGE>
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 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;
2
<PAGE>
(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 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.
3
<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 21st day
of April, 1999.
GALILEO TECHNOLOGY, LTD.
By: /s/ George A. Hervey
--------------------
George A. Hervey
Chief Financial Officer
4
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Exhibit
- ------ -------
5.1 Opinion regarding legality of securities to be offered
23.1 Consent of Independent Auditors
23.2 Consent of Primes, Shiloh, Givon & Co.
(See Exhibit 5.1)
99.1 Galileo Technology Ltd. 1997 Employee Stock Purchase Plan
<PAGE>
Exhibit 5.1
April 15, 1999
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
21,310 Ordinary Shares of the Company issuable pursuant to the Company's 1997
Employees' Stock Purchase Plan (the "Plan"), it is our opinion that such
Ordinary Shares of the Company, when issued, sold and fully paid for in
accordance with the Plan (provided that they are not offered to the public in
Israel), 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, Meir
Law Office
<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 18, 1999, 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, 1998, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young LLP
Palo Alto, California
April 15, 1999
<PAGE>
Exhibit 99.1
GALILEO TECHNOLOGY LTD.
1997 EMPLOYEE STOCK PURCHASE PLAN
(Adopted and Effective October 6, 1997, as Amended August 4, 1998)
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 1. Establishment of the Plan.................................... 1
Section 2. Definitions.................................................. 1
Section 3. Shares Authorized............................................ 2
Section 4. Administration............................................... 3
Section 5. Eligibility and Participation................................ 3
Section 6. Offering and Purchase Periods................................ 4
Section 7. Purchase Price............................................... 4
Section 8. Employee Contributions....................................... 4
Section 9. Plan Accounts; Purchase of Shares............................ 5
Section 10. Withdrawal From the Plan..................................... 5
Section 11. Taxes........................................................ 6
Section 12. Effect of Termination of Employment or Death................. 6
Section 13. Rights Not Transferable...................................... 6
Section 14. Recapitalization, Etc........................................ 7
Section 15. Limitation on Stock Ownership................................ 7
Section 16. No Rights as an Employee..................................... 7
Section 17. Rights as a Shareholder...................................... 7
Section 18. Use of Funds................................................. 8
Section 19. Amendment or Termination of the Plan......................... 8
Section 20. Governing Law................................................ 8
</TABLE>
<PAGE>
Exhibit 99.1
GALILEO TECHNOLOGY LTD.
1997 EMPLOYEE STOCK PURCHASE PLAN
(Adopted and Effective October 6, 1997, as Amended August 4, 1998)
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
1
<PAGE>
respect to a subsequent Offering Period that commences after such Participant
has returned to work from the unpaid leave of absence.
(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.
Subject to adjustment as provided in Section 14, the maximum aggregate
number of Ordinary Shares that may be offered under the Plan shall initially be
100,000; provided, however, that the number
2
<PAGE>
of Ordinary Shares that may be offered under the Plan shall be increased each
year by 105 percent of the number of shares purchased under the Plan in the
previous calendar year.
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.
3
<PAGE>
(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
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 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. The duration of the
first and second Offering Periods is 22 months. The first Offering Period
commences on January 1, 1998 and ends on October 31, 1999, and shall contain
four Purchase Periods commencing on January 1, 1998, July 1, 1998, November 1,
1998 and May 1, 1999. The second Offering Period commences on July 1, 1998 and
ends on April 30, 2000, and shall contain four Purchase Periods commencing on
July 1, 1998, November 1, 1998, May 1, 1999 and November 1, 1999. Thereafter,
the duration of each subsequent Offering Period shall be two years commencing on
November 1 or May 1 and ending 24 months later on October 31 or April 30, and
shall contain four Purchase Periods commencing on each November 1 and May 1
during each such 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
4
<PAGE>
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.
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
5
<PAGE>
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
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.
Amendment approved by the Board of Directors on June 29, 1998.
Amendment approved by the Shareholders August 4, 1998.
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