<PAGE>
As filed with the Securities and Exchange Commission on: January 17, 1996
Registration No. 33-64911-01
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
POST-EFFECTIVE AMENDMENT NO. 1 ON FORM S-8* TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_______________
ADVANCED MICRO DEVICES, INC.
------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 94-1692300
- --------------------------------- ------------------------------------
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER IDENTIFICATION NO.)
OF INCORPORATION OR ORGANIZATION)
ONE AMD PLACE, SUNNYVALE, CALIFORNIA 94088-3453
- ---------------------------------------- ----------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
1995 EMPLOYEE STOCK PURCHASE PLAN OF NEXGEN, INC.**
1995 STOCK PLAN OF NEXGEN, INC., AS AMENDED**
NEXGEN, INC. 1987 EMPLOYEE STOCK PLAN**
---------------------------------------------------
(FULL TITLE OF THE PLANS)
THOMAS M.MCCOY
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
ADVANCED MICRO DEVICES, INC., ONE AMD PLACE,
SUNNYVALE, CALIFORNIA 94088-3453
- -------------------------------------------------------------------------------
(NAME AND ADDRESS OF AGENT FOR SERVICE)
(408) 732-2400
--------------------
(TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
* Filed as a post-effective amendment on Form S-8 to such Form S-4 Registration
Statement pursuant to the provisions of Rule 401(e) and the procedure described
herein. See "INTRODUCTORY STATEMENT."
** Each such plan to be assumed by Advanced Micro Devices, Inc. following the
effectiveness of the merger of NexGen, Inc. with and into Advanced Micro
Devices, Inc. pursuant to an Agreement and Plan of Merger dated as of October
20, 1995, as amended on December 11, 1995 and January 11, 1996.
<PAGE>
INTRODUCTORY STATEMENT
Advanced Micro Devices, Inc. ("AMD") hereby amends its registration
Statement on Form S-4 (No. 33-64911) (the "Registration Statement"), by filing
this Post-Effective Amendment No. 1 on Form S-8 (the "Post-Effective Amendment")
relating to the shares of common stock, $.01 par value, of AMD ("AMD Common
Stock") issuable upon the exercise of stock options granted under the 1995 Stock
Plan of NexGen, Inc., as amended, and the NexGen, Inc. 1987 Employee Stock Plan,
or issuable pursuant to the 1995 Employee Stock Purchase Plan of NexGen, Inc.
(together, the "Plans"). AMD and NexGen, Inc. ("NexGen") entered into an
Agreement and Plan of Merger dated as of October 20, 1995, amended as of
December 11, 1995 and January 11, 1996 (the "Merger Agreement"), pursuant to
which on January 17, 1996, NexGen merged with and into AMD (the "Merger").
In the Merger, each outstanding share of common stock, $.0001 par value, of
NexGen ("NexGen Common Stock") was converted into the right to receive .8 of a
share of AMD Common Stock (the "Exchange Ratio"). In addition, AMD assumed the
Plans and the options and rights to purchase shares of NexGen Common Stock
previously granted thereunder became options and rights to purchase shares of
AMD Common Stock, as adjusted as to price and/or number of shares to reflect the
Exchange Ratio.
The designation of the Post-Effective Amendment as Registration No. 33-
64911-01 denotes that the Post-Effective Amendment relates only to the shares of
AMD Common Stock issuable upon exercise of stock options and rights to purchase
stock under the Plans and that this is the first Post-Effective Amendment filed
with respect to such shares.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION.*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*
* Information required by Part I to be contained in the Section 10(a)
prospectus with respect to each plan for which this Registration Statement is
filed is omitted from this Registration Statement in accordance with Rule 428
under the Securities Act of 1933 and the note to Part I of Form S-8.
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by the Registrant with the Securities
and Exchange Commission are incorporated by reference in this Registration
Statement:
a. Annual Report on Form 10-K for the fiscal year ended December 25,
1994, and Amendment No. 1 thereto on Form 10-K/A dated August 7, 1995,
filed pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act");
b. Quarterly Reports on Form 10-Q for the quarters ended April 2,
1995, July 2, 1995 and October 1, 1995, and Current Reports on Form 8-K
dated December 30, 1994, February 10, 1995, March 13, 1995, April 17, 1995,
September 25, 1995, November 6, 1995, December 18, 1995, January 5, 1996,
January 10, 1996 and January 12, 1996.
c. The description of the Registrant's Common Stock contained in the
Registration Statement on Form 8-A filed September 14, 1979, under Section
12 of the Exchange Act, including any amendment or report filed for the
purpose of updating such description.
All documents 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 a part
hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
Not applicable.
3
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Delaware General Corporation Law provides for the indemnification of
officers and directors under certain conditions. The Bylaws of the Registrant
permit indemnification to the maximum extent permitted by Delaware law. In
addition, the Registrant is bound by agreements with certain of its directors
and officers which obligate it to indemnify such persons in various
circumstances. The Registrant has in effect a director and officer liability
insurance policy indemnifying the Registrant and the officers and directors of
the Registrant and officers and directors of the Registrant's subsidiaries
within a specific limit for certain liabilities incurred by them, including
liabilities under the Securities Act of 1933. The Registrant pays the entire
premium of this policy. The Registrant's Certificate of Incorporation contains
a provision which eliminates the personal liability of directors of the
Registrant for monetary damages for certain breaches of fiduciary duty, as
permitted by Section 102(b)(7) of the Delaware General Corporation Law.
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 of 1933;
(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;
(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.
4
<PAGE>
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, 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
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 of 1933, 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 of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 13(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 of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, 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 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 of whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
5
<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 Post-Effective
Amendment No. 1 to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Sunnyvale, California, on this 17th
day of January, 1996.
ADVANCED MICRO DEVICES, INC.
By /s/ Marvin D. Burkett
---------------------------
Marvin D. Burkett
Senior Vice President
Chief Financial and Administrative
Officer and Treasurer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
* Chairman of the Board January 17, 1996
- ----------------------- and Chief Executive
W.J. Sanders III Officer (Principal
Executive Officer)
* Vice Chairman of the January 17, 1996
- ----------------------- Board
Anthony B. Holbrook
* Director, President January 17, 1996
- ----------------------- and Chief Operating
Richard Previte Officer
* Director January 17, 1996
- -----------------------
Friedrich Baur
6
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* Director January 17, 1996
- -----------------------
Charles M. Blalack
* Director January 17, 1996
- -----------------------
R. Gene Brown
* Director January 17, 1996
- -----------------------
Joe L. Roby
* Director January 17, 1996
- -----------------------
Leonard Silverman
/s/ Marvin D. Burkett Senior Vice President, January 17, 1996
- ----------------------- Chief Financial and
Marvin D. Burkett Administrative Officer
and Treasurer
(Principal Financial
Officer and Principal
Accounting Officer)
* By: /s/ Marvin D. Burkett
---------------------
Marvin D. Burkett
Attorney-in-Fact
7
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
No. Exhibit Name
- ------- ------------
5* Opinion of Counsel; Bronson, Bronson & McKinnon
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2* Consent of Counsel (See Exhibit 5)
24* Power of Attorney
99.1 1995 Employee Stock Purchase Plan of NexGen, Inc.
99.2 1995 Stock Plan of NexGen, Inc., as amended
99.3 NexGen, Inc. 1987 Employee Stock Plan
* Previously filed
8
<PAGE>
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Post-Effective Amendment No.
1 on Form S-8 to the Registration Statement (Form S-4 No. 33-64911) of Advanced
Micro Devices, Inc. pertaining to the 1995 Employee Stock Purchase Plan of
NexGen, Inc., the 1995 Stock Plan of NexGen, Inc., as amended, and the NexGen,
Inc. 1987 Employee Stock Plan, of our report dated January 5, 1995, except for
the first paragraph of Note 14, as to which the date is January 11, 1995; the
fourth paragraph of Note 5, as to which the date is February 10, 1995; and the
fourth paragraph of Note 6, as to which the date is February 16, 1995, with
respect to the consolidated financial statements of Advanced Micro Devices,
Inc., incorporated by reference in its Annual Report (Form 10-K) for the year
ended December 25, 1994, and the related financial statement schedule included
therein, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
San Jose, California
January 16, 1996
<PAGE>
EXHIBIT 99.1
1995 EMPLOYEE STOCK PURCHASE PLAN OF NEXGEN, INC.
-------------------------------------------------
(as amended and restated effective January 1, 1996)
<PAGE>
TABLE OF CONTENTS
-----------------
Page
SECTION 1. PURPOSE OF THE PLAN............................................ 1
SECTION 2. ADMINISTRATION OF THE PLAN..................................... 1
SECTION 3. ENROLLMENT AND PARTICIPATION................................... 1
SECTION 4. EMPLOYEE CONTRIBUTIONS......................................... 3
SECTION 5. WITHDRAWAL FROM THE PLAN....................................... 3
SECTION 6. CHANGE IN EMPLOYMENT STATUS.................................... 3
SECTION 7. PLAN ACCOUNTS AND PURCHASE OF SHARES........................... 4
SECTION 8. LIMITATIONS ON STOCK OWNERSHIP................................. 5
SECTION 9. RIGHTS NOT TRANSFERABLE........................................ 6
SECTION 10. NO RIGHTS AS AN EMPLOYEE...................................... 6
SECTION 11. NO RIGHTS AS A STOCKHOLDER.................................... 7
SECTION 12. STOCK OFFERED UNDER THE PLAN.................................. 7
SECTION 13. AMENDMENT OR DISCONTINUANCE................................... 7
SECTION 14. DEFINITIONS................................................... 8
SECTION 15. EXECUTION..................................................... 10
<PAGE>
1995 EMPLOYEE STOCK PURCHASE PLAN OF NEXGEN, INC.
-------------------------------------------------
SECTION 1. PURPOSE OF THE PLAN.
- ---------- -------------------
The Plan was adopted by the Company's Board of Directors on March 12, 1995,
effective as of the date of the IPO. The Plan was amended and restated by the
Company's Board of Directors on August 28, 1995, effective as of January 1,
1996.
The purpose of the Plan is to provide Eligible Employees with an opportunity
to increase their proprietary interest in the success of the Company by
purchasing Stock from the Company on favorable terms and to pay for such
purchases through payroll deductions. The Plan is intended to qualify under
section 423 of the Internal Revenue Code of 1986, as amended. The Plan is also
intended to comply with Rule 16b-3 (or its successor) under the Exchange Act.
SECTION 2. ADMINISTRATION OF THE PLAN.
--------- --------------------------
(a) The Committee. The Plan shall be administered by the Committee. The
interpretation and construction by the Committee of any provision of the Plan or
of any right to purchase Stock granted under the Plan shall be conclusive and
binding on all persons.
(b) Rules and Forms. The Committee may adopt such rules and forms under the
Plan as it considers appropriate.
SECTION 3. ENROLLMENT AND PARTICIPATION.
--------- ----------------------------
(a) Offering Periods. While the Plan is in effect, two overlapping Offering
Periods shall commence in each calendar year. The Offering Periods shall consist
of the 24-month periods commencing on each January 1 and July 1, except that the
first Offering Period shall commence on the date of the IPO and end on June 30,
1997.
(b) Accumulation Periods. While the Plan is in effect, two Accumulation
Periods shall commence in each calendar year. The Accumulation Periods shall
consist of the six-month periods commencing on each January 1 and July 1, except
that the first Accumulation Period shall commence on the date of the IPO and end
on December 31, 1995.
(c) Enrollment. Any individual who, on the day preceding the first day of an
Offering Period, qualifies as an Eligible Employee may elect to become a
Participant in the Plan for such Offering Period by executing the enrollment
form prescribed for this purpose by the Committee. The enrollment form shall be
filed with the Company at the prescribed location not later than
<PAGE>
one week prior to the last working day prior to the commencement of such
Offering Period.
(d) Duration of Participation. Once enrolled in the Plan, a Participant
shall continue to participate in the Plan until he or she ceases to be an
Eligible Employee, withdraws from the Plan or reaches the end of the
Accumulation Period in which he or she discontinued employee contributions under
Section 4(d). A Participant who discontinued employee contributions under
Section 4(d) or withdrew from the Plan under Section 5(a) may again become a
Participant, if he or she then is an Eligible Employee, by following the
procedure described in Subsection (c) above. A participant whose employee
contributions were discontinued automatically under Section 8(b) shall
automatically resume participation at the beginning of the next calendar year,
if he or she then is an Eligible Employee.
(e) Applicable Offering Period. For purposes of calculating the Purchase
Price under Section 7(b), the applicable Offering Period shall be determined as
follows:
(i) Once a Participant is enrolled in the Plan for an Offering Period,
such Offering Period shall continue to apply to him or her until the
earliest of (A) the end of such Offering Period, (B) the end of his or her
participation under Subsection (d) above or (C) reenrollment in a
subsequent Offering Period under Paragraph (ii) below.
(ii) In the event that the Fair Market Value of Stock 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.
(iii) 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.
(f) Special Rule for Directors and Officers. Any other provision of the Plan
notwithstanding, an Insider shall not resume employee contributions under the
Plan for a period of at least six months after discontinuing his or her employee
contributions. This Subsection (f) shall be applicable only to extent required
by Rule 16b-3 (or its successor) under the Exchange Act.
2
<PAGE>
SECTION 4. EMPLOYEE CONTRIBUTIONS.
- --------- ----------------------
(a) Frequency of Payroll Deductions. A Participant may purchase shares of
Stock under the Plan solely by means of payroll deductions. Payroll deductions,
as designated by the Participant pursuant to Subsection (b) below, shall occur
on each payday during participation in the Plan.
(b) Amount of Payroll Deductions. An Eligible Employee shall designate on
the enrollment form the portion of his or her Compensation that he or she elects
to have withheld for the purchase of Stock. Such portion shall be a whole
percentage of the Eligible Employee's Compensation, but not less than 1% nor
more than 12%.
(c) Changing Withholding Rate. If a Participant wishes to change the rate of
payroll withholding, he or she may do so by filing a new enrollment form with
the Company at the prescribed location not later than one week prior to the last
working day prior to the commencement of the Accumulation Period for which such
change is to be effective.
(d) Discontinuing Payroll Deductions. If a Participant wishes to discontinue
employee contributions entirely, he or she may do so by filing a new enrollment
form with the Company at the prescribed location at any time. Payroll
withholding shall cease as soon as reasonably practicable after such form has
been received by the Company. (In addition, employee contributions may be
discontinued automatically pursuant to Section 8(b).)
SECTION 5. WITHDRAWAL FROM THE PLAN.
- --------- ------------------------
(a) Withdrawal. A Participant may elect to withdraw from the Plan by filing
the prescribed form with the Company at the prescribed location at any time
before the last day of an Accumulation Period. As soon as reasonably practicable
thereafter, payroll deductions shall cease and the entire amount credited to the
Participant's Plan Account shall be refunded to him or her in cash, without
interest. No partial withdrawals shall be permitted.
(b) Re-Enrollment After Withdrawal. A former Participant who has withdrawn
from the Plan shall not be a Participant until he or she re-enrolls in the Plan
under Section 3(b).
SECTION 6. CHANGE IN EMPLOYMENT STATUS.
- --------- ---------------------------
(a) Termination of Employment. Termination of employment as an Eligible
Employee for any reason, including death, shall be treated as an automatic
withdrawal from the Plan under Section 5(a). (A transfer from one Participating
Company to
3
<PAGE>
another shall not be treated as a termination of employment.)
(b) Leave of Absence. For purposes of the Plan, employment shall not be
deemed to terminate when the Participant goes on a military leave, a sick leave
or another bona fide leave of absence, if the leave was approved by the Company
in writing. Employment, however, shall be deemed to terminate 90 days after the
Participant goes on a leave, unless a contract or statute protects his or her
right to return to work. Employment shall be deemed to terminate in any event
when the approved leave ends, unless the Participant immediately returns to
work. The Company shall determine which leaves count for this purpose.
(c) Death. In the event of the Participant's death, the amount credited to
his or her Plan Account shall be paid to a beneficiary designated by him or her
for this purpose on the prescribed form or, if none, to the Participant's
estate. Such form shall be valid only if it was filed with the Company at the
prescribed location before the Participant's death.
SECTION 7. PLAN ACCOUNTS AND PURCHASE OF SHARES.
- --------- ------------------------------------
(a) Plan Accounts. The Company shall maintain a Plan Account on its books
in the name of each Participant. Whenever an amount is deducted from the
Participant's Compensation under the Plan, such amount shall be credited to the
Participant's Plan Account. No interest shall be credited to Plan Accounts.
(b) Purchase Price. The Purchase Price for each share of Stock purchased
at the close of an Accumulation Period shall be the lower of:
(i) 85% of the Fair Market Value of such share on the last trading day
in such Accumulation Period; or
(ii) 85% of the Fair Market Value of such share on the last trading day
before the commencement of the applicable Offering Period (as determined
under Section 3(e)) or, in the case of the first Offering Period under the
Plan, 85% of the price at which one share of Stock is offered to the public
in the IPO.
(c) Number of Shares Purchased. As of the last day of each Accumulation
Period, each Participant shall be deemed to have elected to purchase the number
of shares of Stock calculated in accordance with this Subsection (c), unless the
Participant has previously elected to withdraw from the Plan in accordance with
Section 5(a). The amount then in the Participant's Plan Account shall be
divided by the Purchase Price, and the number of shares that results shall be
purchased from the Company with the funds in the Participant's Plan Account.
The foregoing
4
<PAGE>
notwithstanding, no Participant shall purchase more than a maximum of 5,000
shares of Stock with respect to any Accumulation Period nor shares of Stock in
excess of the amounts set forth in Sections 8 and 12(a). The Committee may
determine with respect to all Participants that any fractional share, as
calculated under this Subsection (c), shall be rounded down to the next lower
whole share.
(d) Available Shares Insufficient. In the event that the aggregate number
of shares that all Participants elect to purchase during an Accumulation Period
exceeds the maximum number of shares remaining available for issuance under
Section 12(a), then the number of shares to which each Participant is entitled
shall be determined by multiplying the number of shares available for issuance
by a fraction, the numerator of which is the number of shares that such
Participant has elected to purchase and the denominator of which is the number
of shares that all Participants have elected to purchase.
(e) Issuance of Stock. Certificates representing the shares of Stock
purchased by a Participant under the Plan shall be issued to him or her as soon
as reasonably practicable after the close of the applicable Accumulation Period,
except that the Committee may determine that such shares shall be held for each
Participant's benefit by a broker designated by the Committee (unless the
Participant has elected that certificates be issued to him or her). Shares may
be registered in the name of the Participant or jointly in the name of the
Participant and his or her spouse as joint tenants with right of survivorship or
as community property.
(f) Unused Cash Balances. An amount remaining in the Participant's Plan
Account that represents the Purchase Price for any fractional share shall be
carried over in the Participant's Plan Account to the next Accumulation Period.
Any amount remaining in the Participant's Plan Account that represents the
Purchase Price for whole shares that could not be purchased by reason of
Subsection (c) above, Section 8 or Section 12(a) shall be refunded to the
Participant in cash, without interest.
(g) Prohibition Against Resale by Insiders. Subsection (e) above
notwithstanding, during a period of three months following the last day of an
Accumulation Period, all shares purchased under the Plan on such day by Insiders
shall be held in escrow by the Company or its designee as agent for the Insiders
(and their spouses) who own such shares and shall not be transferable or
assignable.
SECTION 8. LIMITATIONS ON STOCK OWNERSHIP.
- --------- ------------------------------
(a) Five Percent Limit. Any other provision of the Plan
5
<PAGE>
notwithstanding, no Participant shall be granted a right to purchase Stock under
the Plan if such Participant, immediately after his or her election to purchase
such Stock, would own stock possessing more than 5% of the total combined voting
power or value of all classes of stock of the Company or any parent or
Subsidiary of the Company. For purposes of this Subsection (a), ownership of
stock shall be determined after applying the attribution rules of section 424(d)
of the Internal Revenue Code of 1986, as amended, and each Participant shall be
considered to own any stock that he or she has a right or option to purchase
under this or any other plan.
(b) $25,000 Limit. Any other provision of the Plan notwithstanding, no
Participant shall be granted a right to purchase Stock under the Plan if such
Participant's rights to purchase stock under this and all other employee stock
purchase plans of the Company or any parent or Subsidiary of the Company would
accrue at a rate that exceeds $25,000 of the fair market value of such stock
(determined at the beginning of the applicable Offering Period) for each
calendar year for which such right is outstanding at any time. For purposes of
this Subsection (b), employee stock purchase plans not described in section 423
of the Internal Revenue Code of 1986, as amended, shall be disregarded, and each
Participant shall be considered to have the right to purchase not more than
5,000 shares of Stock under this Plan with respect to each Accumulation Period.
If a Participant is precluded by this Subsection (b) from purchasing additional
Stock under the Plan, then his or her employee contributions shall automatically
be discontinued for the balance of the calendar year and resume at the beginning
of the next calendar year (if he or she then is an Eligible Employee).
SECTION 9. RIGHTS NOT TRANSFERABLE.
- --------- -----------------------
The rights of any Participant under the Plan, or any Participant's interest
in any Stock or moneys 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 in any other manner other than by beneficiary designation or the laws of
descent and distribution. If a Participant in any manner attempts to transfer,
assign or otherwise encumber his or her rights or interest under the Plan, other
than by beneficiary designation or the laws of descent and distribution, then
such act shall be treated as an election by the Participant to withdraw from the
Plan under Section 5(a).
SECTION 10. 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
6
<PAGE>
employment of any person at any time, with or without cause.
SECTION 11. NO RIGHTS AS A STOCKHOLDER.
- ---------- --------------------------
A Participant shall have no rights as a stockholder with respect to any
shares that he or she has purchased, or may have a right to purchase, under the
Plan until the date of issuance of a stock certificate for such shares.
SECTION 12. STOCK OFFERED UNDER THE PLAN.
- ---------- ----------------------------
(a) Authorized Shares. The aggregate number of shares of Stock available
for purchase under the Plan shall be 500,000, subject to adjustment pursuant to
this Section 12.
(b) Anti-Dilution Adjustments. The aggregate number of shares of Stock
offered under the Plan, the 5,000-share limitation described in Section 7(c) and
the price of shares that any Participant has elected to purchase shall be
adjusted proportionately by the Committee for any increase or decrease in the
number of outstanding shares of Stock resulting from a subdivision or
consolidation of shares, the payment of a stock dividend, any other increase or
decrease in such shares effected without receipt or payment of consideration by
the Company or the distribution of the shares of a Subsidiary to the Company's
stockholders.
(c) Reorganizations. In the event of a dissolution or liquidation of the
Company, or a merger or consolidation to which the Company is a constituent
corporation, the Plan shall terminate unless the plan of merger, consolidation
or reorganization provides otherwise, and all amounts that have been withheld
but not yet applied to purchase Stock hereunder shall be refunded, without
interest. 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 13. AMENDMENT OR DISCONTINUANCE.
- ---------- ---------------------------
The Board of Directors shall have the right to amend, suspend or terminate
the Plan at any time and without notice. Except as provided in Section 12, any
increase in the aggregate number of shares of Stock to be issued under the Plan
shall be subject to approval by a vote of the stockholders of the Company. In
addition, any other amendment of the Plan shall be subject to approval by a vote
of the stockholders of the Company to the extent required by an applicable law
or regulation.
7
<PAGE>
SECTION 14. DEFINITIONS.
- ---------- -----------
(a) "Accumulation Period" means a six-month period during which
contributions may be made toward the purchase of Stock under the Plan, as
determined pursuant to Section 3(b).
(b) "Board of Directors" means the Board of Directors of the Company, as
constituted from time to time.
(c) "Committee" means a committee of the Board of Directors, consisting of
two or more directors appointed by the Board of Directors.
(d) "Company" means NexGen, Inc., a Delaware corporation.
(e) "Compensation" means the total compensation paid in cash to a
Participant by a Participating Company, including salaries, wages, bonuses,
incentive compensation, commissions and overtime pay, but excluding moving or
relocation allowances, car allowances, imputed income attributable to cars or
life insurance, taxable fringe benefits and similar items, all as determined by
the Committee.
(f) "Eligible Employee" means any employee of a Participating Company whose
customary employment is for more than five months per calendar year and for more
than 20 hours per week. An Insider shall not be considered an Eligible Employee
unless he or she:
(i) Was an employee of a Participating Company on the date of the IPO;
or
(ii) Has been an employee of a Participating Company for not less than
12 consecutive months.
(g) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(h) "Fair Market Value" means the market price of Stock, determined by the
Committee as follows:
(i) If Stock was traded over-the-counter on the date in question but
was not traded on the Nasdaq Stock Market or the Nasdaq National Market,
then the Fair Market Value shall be equal to the mean between the last
reported representative bid and asked prices quoted for such date by the
principal automated inter-dealer quotation system on which Stock is quoted
or, if the Stock is not quoted on any such system, by the "Pink Sheets"
published by the National Quotation Bureau, Inc.;
8
<PAGE>
(ii) If Stock was traded over-the-counter on the date in question and
was traded on the Nasdaq Stock Market or the Nasdaq National Market, then
the Fair Market Value shall be equal to the last-transaction price quoted
for such date by the Nasdaq Stock Market or the Nasdaq National Market;
(iii) If the Stock was traded on a stock exchange on the date in
question, then the Fair Market Value shall be equal to the closing price
reported by the applicable composite transactions report for such date; and
(iv) If none of the foregoing provisions is applicable, then the Fair
Market Value shall be determined by the Committee in good faith on such
basis as it deems appropriate.
Whenever possible, the determination of Fair Market Value by the Committee shall
be based on the prices reported in the Western Edition of The Wall Street
Journal or as reported directly to the Company by Nasdaq or a comparable
exchange. Such determination shall be conclusive and binding on all persons.
(i) "Insider" means an employee of a Participating Company who is
considered a director or officer of the Company for purposes of section 16 of
the Exchange Act.
(j) "IPO" means the initial offering of Stock to the public pursuant to a
registration statement filed with the Securities and Exchange Commission on Form
S-1.
(k) "Offering Period" means a 24-month period with respect to which the
right to purchase Stock may be granted under the Plan, as determined pursuant to
Section 3(a).
(l) "Participant" means an Eligible Employee who elects to participate in
the Plan, as provided in Section 3(c).
(m) "Participating Company" means the Company and each present or future
Subsidiary, except Subsidiaries excluded by the Committee.
(n) "Plan" means this 1995 Employee Stock Purchase Plan of NexGen, Inc., as
it may be amended from time to time.
(o) "Plan Account" means the account established for each Participant
pursuant to Section 7(a).
(p) "Purchase Price" means the price at which Participants may purchase
Stock under the Plan, as determined pursuant to Section 7(b).
9
<PAGE>
(q) "Stock" means the Common Stock of the Company.
(r) "Subsidiary" means a corporation, 50% or more of the total combined
voting power of all classes of stock of which is owned by the Company or by
another Subsidiary.
SECTION 15. EXECUTION.
- ---------- ---------
To record the amendment and restatement of the Plan by the Board of
Directors on August 28, 1995, the Company has caused its authorized officer to
execute the same.
NEXGEN, INC.
By ___________________________
10
<PAGE>
EXHIBIT 99.2
1995 STOCK PLAN OF NEXGEN, INC.
-------------------------------
(As Amended Effective December 8, 1995)
<PAGE>
TABLE OF CONTENTS
-----------------
Page
----
SECTION 1. ESTABLISHMENT AND PURPOSE...................................... 1
SECTION 2. DEFINITIONS.................................................... 1
SECTION 3. ADMINISTRATION................................................. 4
(a) Committee Membership.......................................... 4
(b) Committee Procedures.......................................... 5
(c) Committee Responsibilities.................................... 5
SECTION 4. ELIGIBILITY.................................................... 6
(a) General Rules................................................. 6
(b) Outside Directors............................................. 6
(c) Ten-Percent Stockholders...................................... 8
(d) Attribution Rules............................................. 8
(e) Outstanding Stock............................................. 8
SECTION 5. STOCK SUBJECT TO PLAN.......................................... 8
(a) Basic Limitation.............................................. 8
(b) Additional Shares.............................................. 9
SECTION 6. TERMS AND CONDITIONS OF AWARDS OR SALES......................... 9
(a) Stock Purchase Agreement....................................... 9
(b) Duration of Offers and Nontransferability of Rights............ 9
(c) Purchase Price................................................. 9
(d) Withholding Taxes.............................................. 9
(e) Restrictions on Transfer of Shares............................. 10
SECTION 7. TERMS AND CONDITIONS OF OPTIONS................................. 10
(a) Stock Option Agreement......................................... 10
(b) Number of Shares............................................... 10
(c) Exercise Price................................................. 10
(d) Withholding Taxes.............................................. 10
<PAGE>
(e) Exercisability................................................. 11
(f) Term........................................................... 11
(g) Nontransferability............................................. 11
(h) No Rights as a Stockholder..................................... 11
(i) Modification, Extension and Renewal of Options................. 11
(j) Restrictions on Transfer of Shares............................. 12
SECTION 8. PAYMENT FOR SHARES.............................................. 12
(a) General Rule................................................... 12
(b) Surrender of Stock............................................. 12
(c) Exercise/Sale.................................................. 12
(d) Exercise/Pledge................................................ 13
(e) Services Rendered.............................................. 13
(f) Promissory Note................................................ 13
SECTION 9. ADJUSTMENT OF SHARES............................................ 13
(a) General........................................................ 13
(b) Reorganizations................................................ 14
(c) Reservation of Rights.......................................... 14
SECTION 10. SECURITIES LAWS................................................ 14
SECTION 11. NO RETENTION RIGHTS............................................ 14
SECTION 12. DURATION AND AMENDMENTS........................................ 15
(a) Term of the Plan............................................... 15
(b) Right to Amend or Terminate the Plan........................... 15
(c) Effect of Amendment or Termination............................. 15
SECTION 13. EXECUTION...................................................... 15
<PAGE>
1995 STOCK PLAN OF NEXGEN, INC.
-------------------------------
SECTION 1. ESTABLISHMENT AND PURPOSE.
- --------- -------------------------
The Plan was adopted on March 12, 1995, and amended on May 10, 1995. Its
purpose is to offer selected employees, consultants and promotional
representatives an opportunity to acquire a proprietary interest in the success
of the Company, or to increase such interest, by purchasing Shares of the
Company's Common Stock. The Plan provides both for the direct award or sale of
Shares and for the grant of Options to purchase Shares. Options granted under
the Plan may include Nonstatutory Options as well as ISOs intended to qualify
under section 422 of the Code.
The Plan is intended to comply in all respects with Rule 16b-3 (or its
successor) under the Exchange Act and shall be construed accordingly.
SECTION 2. DEFINITIONS.
--------- -----------
(a) "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time.
(b) "Change in Control" shall mean the occurrence of either of the following
events:
(i) A change in the composition of the Board of Directors, as a result
of which fewer than one-half of the incumbent directors are directors who
either:
(A) Had been directors of the Company 24 months prior to such
change; or
(B) Were elected, or nominated for election, to the Board of
Directors with the affirmative votes of at least a majority of the
directors who had been directors of the Company 24 months prior to
such change and who were still in office at the time of the election
or nomination; or
(ii) Any "person" (as such term is used in sections 13(d) and 14(d) of
the Exchange Act) by the acquisition or aggregation of securities is or
becomes the beneficial owner, directly or indirectly, of securities of the
Company representing 50 percent or more of the combined voting power of the
Company's then outstanding securities ordinarily (and apart from rights
accruing under special circumstances) having the right to vote at elections
of directors (the "Base Capital Stock"); except that any change in the
relative beneficial ownership of the Company's securities by any person
resulting solely from a reduction in the aggregate number of outstanding
shares of Base Capital Stock, and
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any decrease thereafter in such person's ownership of securities, shall be
disregarded until such person increases in any manner, directly or
indirectly, such person's beneficial ownership of any securities of the
Company. For purposes of this Paragraph (ii), the term "person" shall not
include an employee benefit plan maintained by the Company.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(d) "Committee" shall mean a committee of the Board of Directors, as
described in Section 3(a).
(e) "Company" shall mean NexGen, Inc., a Delaware corporation, its parent
corporation, or its successor.
(f) "Employee" shall mean:
(i) Any individual who is a common-law employee of the Company or of a
Subsidiary;
(ii) An Outside Director; and
(iii) An independent contractor who performs services for the Company
or a Subsidiary and who is not a member of the Board of Directors.
Service as an Outside Director or independent contractor shall be considered
employment for all purposes of the Plan, except as provided in Section 4(a).
(g) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(h) "Exercise Price" shall mean the amount for which one Share may be
purchased upon exercise of an Option, as specified by the Committee in the
applicable Stock Option Agreement.
(i) "Fair Market Value" shall mean the market price of Stock, determined
by the Committee as follows:
(i) If Stock was traded over-the-counter on the date in question but
was not traded on the Nasdaq system or the Nasdaq National Market System,
then the Fair Market Value shall be equal to the mean between the last
reported representative bid and asked prices quoted for such date by the
principal automated inter-dealer quotation system on which Stock is quoted
or, if Stock is not quoted on any such system, by the "Pink Sheets"
published by the National Quotation Bureau, Inc.;
(ii) If Stock was traded over-the-counter on the date in question and
was traded on the Nasdaq system or the Nasdaq National Market System, then
the Fair Market Value
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<PAGE>
shall be equal to the last-transaction price quoted for such date by the
Nasdaq system or the Nasdaq National Market System;
(iii) If Stock was traded on a stock exchange on the date in question,
then the Fair Market Value shall be equal to the closing price reported by
the applicable composite-transactions report for such date; and
(iv) If none of the foregoing provisions is applicable, then the Fair
Market Value shall be determined by the Committee in good faith on such
basis as it deems appropriate.
In all cases, the determination of Fair Market Value by the Committee shall be
conclusive and binding on all persons.
(j) "IPO" means the initial offering of Stock to the public pursuant to a
registration statement filed with the Securities and Exchange Commission on Form
S-1.
(k) "ISO" shall mean an employee incentive stock option described in section
422(b) of the Code.
(l) "Nonstatutory Option" shall mean a stock option not described in
sections 422(b) or 423(b) of the Code.
(m) "Offeree" shall mean an individual to whom the Committee has offered the
right to acquire Shares under the Plan (other than upon exercise of an Option).
(n) "Option" shall mean an ISO or Nonstatutory Option granted under the Plan
and entitling the holder to purchase Shares.
(o) "Optionee" shall mean an individual who holds an Option.
(p) "Outside Director" shall mean a member of the Board of Directors who
is not a common-law employee of the Company or of a Subsidiary.
(q) "Plan" shall mean this 1995 Stock Plan of NexGen, Inc., as it may be
amended from time to time.
(r) "Purchase Price" shall mean the consideration for which one Share may
be acquired under the Plan (other than upon exercise of an Option), as specified
by the Committee.
(s) "Service" shall mean service as an Employee.
(t) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 9 (if applicable).
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<PAGE>
(u) "Stock" shall mean the Common Stock of the Company.
(v) "Stock Option Agreement" shall mean the agreement between the Company
and an Optionee which contains the terms, conditions and restrictions pertaining
to his or her Option.
(w) "Stock Purchase Agreement" shall mean the agreement between the Company
and an Offeree who acquires Shares under the Plan which contains the terms,
conditions and restrictions pertaining to the acquisition of such Shares.
(x) "Subsidiary" shall mean any corporation, if the Company and/or one or
more other Subsidiaries own not less than 50 percent of the total combined
voting power of all classes of outstanding stock of such corporation. A
corporation that attains the status of a Subsidiary on a date after the adoption
of the Plan shall be considered a Subsidiary commencing as of such date.
(y) "Total and Permanent Disability" shall mean that the Optionee is unable
to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period
of not less than one year.
(z) "Vesting Start Date," in the case of an Outside Director, shall mean
the latest of:
(i) The date of the IPO;
(ii) The earliest date when the Outside Director no longer holds
unexercisable options to purchase more than 10,000 Shares that were granted
to him or her by the Company prior to the IPO; or
(iii) The date when the Outside Director first joins the Board of
Directors.
SECTION 3. ADMINISTRATION.
- --------- --------------
(a) Committee Membership. The Plan shall be administered by the Committee.
The Committee shall consist of two or more members of the Board of Directors who
meet the requirements established from time to time by:
(i) The Securities and Exchange Commission for plans intended to
qualify for exemptions under Rule 16b-3 (or its successor) under the
Exchange Act; and
(ii) The Internal Revenue Service for plans intended to qualify for an
exemption under section 162(m)(4)(C) of the Code.
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<PAGE>
An Outside Director shall not fail to meet such requirements solely because he
or she receives the Nonstatutory Options described in Section 4(b). The Board
of Directors may appoint a separate committee, consisting of one or more members
of the Board of Directors who need not meet such requirements. Such committee
may administer the Plan with respect to Employees who are not officers or
directors of the Company, may grant Shares and Options under the Plan to such
Employees and may determine the timing, number of Shares and other terms of such
grants.
(b) Committee Procedures. The Board of Directors shall designate one of
the members of the Committee as chairman. The Committee may hold meetings at
such times and places as it shall determine. The acts of a majority of the
Committee members present at meetings at which a quorum exists, or acts reduced
to or approved in writing by all Committee members, shall be valid acts of the
Committee.
(c) Committee Responsibilities. Subject to the provisions of the Plan,
the Committee shall have full authority and discretion to take the following
actions:
(i) To interpret the Plan and to apply its provisions;
(ii) To adopt, amend or rescind rules, procedures and forms relating
to the Plan;
(iii) To authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan;
(iv) To determine when Shares are to be awarded or offered for sale
and when Options are to be granted under the Plan;
(v) To select the Offerees and Optionees;
(vi) To determine the number of Shares to be offered to each Offeree
or to be made subject to each Option;
(vii) To prescribe the terms and conditions of each award or sale of
Shares, including (without limitation) the Purchase Price, and to specify
the provisions of the Stock Purchase Agreement relating to such award or
sale;
(viii) To prescribe the terms and conditions of each Option,
including (without limitation) the Exercise Price, to determine whether
such Option is to be classified as an ISO or as a Nonstatutory Option, and
to specify the provisions of the Stock Option Agreement relating to such
Option;
(ix) To amend any outstanding Stock Purchase Agreement or Stock
Option Agreement, subject to applicable legal
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<PAGE>
restrictions and to the consent of the Offeree or Optionee who entered into
such agreement;
(x) To prescribe the consideration for the grant of each Option or
other right under the Plan and to determine the sufficiency of such
consideration; and
(xi) To take any other actions deemed necessary or advisable for the
administration of the Plan.
All decisions, interpretations and other actions of the Committee shall be final
and binding on all Offerees, all Optionees, and all persons deriving their
rights from an Offeree or Optionee. No member of the Committee shall be liable
for any action that he or she has taken or has failed to take in good faith with
respect to the Plan, any Option, or any right to acquire Shares under the Plan.
SECTION 4. ELIGIBILITY.
- --------- -----------
(a) General Rules. Only Employees (including, without limitation,
independent contractors who are not members of the Board of Directors) shall be
eligible for designation as Optionees or Offerees by the Committee. In
addition, only Employees who are common-law employees of the Company or a
Subsidiary shall be eligible for the grant of ISOs. Employees who are Outside
Directors shall only be eligible for the grant of the Nonstatutory Options
described in Subsection (b) below.
(b) Outside Directors. Any other provision of the Plan notwithstanding,
the participation of Outside Directors in the Plan shall be subject to the
following restrictions:
(i) Exclusive Provision. Outside Directors shall receive no grants
other than the Nonstatutory Options described in this Subsection (b).
(ii) One-Time Grant to Existing Outside Directors. Each Outside
Director who is a member of the Board of Directors on the date of the IPO
shall receive a one-time grant of a Nonstatutory Option covering 25,000
Shares on such date. The first 20 percent of an Option granted to an
Outside Director under this Paragraph (ii) shall become exercisable on the
first anniversary of such Outside Director's Vesting Start Date. The
remaining 80 percent of such Option shall become exercisable in 48 equal
monthly installments over the four-year period commencing on the first
anniversary of such Outside Director's Vesting Start Date.
(iii) Initial Grant to New Outside Directors. Each Outside Director
who first becomes a member of the Board of Directors after the IPO shall
receive a one-time grant of a Nonstatutory Option covering 25,000 Shares
(subject to
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<PAGE>
adjustment under Section 9). Such Option shall be granted on the date when
such Outside Director first joins the Board of Directors. The first 20
percent of an Option granted to an Outside Director under this Paragraph
(iii) shall become exercisable on the first anniversary of the date of
grant. The remaining 80 percent of such Option shall become exercisable in
48 equal monthly installments over the four-year period commencing on the
first anniversary of the date of grant.
(iv) Annual Grants. Each Outside Director shall receive an annual
grant of a Nonstatutory Option covering 5,000 Shares (subject to adjustment
under Section 9). Such Option shall be granted on each anniversary of such
Outside Director's Vesting Start Date (commencing with the first
anniversary). The first 20 percent of an Option granted to an Outside
Director under this Paragraph (iv) shall become exercisable on the first
anniversary of the date of grant. The remaining 80 percent of such Option
shall become exercisable in 48 equal monthly installments over the four-
year period commencing on the first anniversary of the date of grant.
(v) Accelerated Vesting. All Nonstatutory Options granted to an
Outside Director under this Subsection (b) shall also become exercisable in
full in the event of:
(A) A Change in Control; or
(B) The termination of the Outside Director's service because of
death, Total and Permanent Disability or retirement at or after age
65.
(vi) Exercise Price. The Exercise Price under all Nonstatutory
Options granted to an Outside Director under this Subsection (b) shall be
equal to 100 percent of the Fair Market Value of a Share on the date of
grant, payable in one of the forms described in Subsection (a), (b), (c) or
(d) of Section 8.
(vii) Term. All Nonstatutory Options granted to an Outside Director
under this Subsection (b) shall terminate on the earliest of:
(A) The 10th anniversary of the date of grant;
(B) The date three months after the termination of such Outside
Director's service for any reason other than death or Total and
Permanent Disability;
(C) The date six months after the termination of such Outside
Director's service because of Total and Permanent Disability; or
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<PAGE>
(D) The date 12 months after such Outside Director's death.
(viii) Option Agreement. A Nonstatutory Option grant to an Outside
Director under this Subsection (b) shall be invalid if such Outside
Director declines to execute a Stock Option Agreement pursuant to Section
7(a).
(c) Ten-Percent Stockholders. An Employee who owns more than 10 percent
of the total combined voting power of all classes of outstanding stock of the
Company or any of its Subsidiaries shall not be eligible for the grant of an ISO
unless:
(i) The Exercise Price is at least 110 percent of the Fair Market
Value of a Share on the date of grant; and
(ii) Such ISO by its terms is not exercisable after the expiration of
five years from the date of grant.
(d) Attribution Rules. For purposes of Subsection (c) above, in
determining stock ownership, an Employee shall be deemed to own the stock owned,
directly or indirectly, by or for such Employee's brothers, sisters, spouse,
ancestors and lineal descendants. Stock owned, directly or indirectly, by or
for a corporation, partnership, estate or trust shall be deemed to be owned
proportionately by or for its stockholders, partners or beneficiaries. Stock
with respect to which such Employee holds an option shall not be counted.
(e) Outstanding Stock. For purposes of Subsection (c) above, "outstanding
stock" shall include all stock actually issued and outstanding immediately after
the grant. "Outstanding stock" shall not include shares authorized for issuance
under outstanding options held by the Employee or by any other person.
SECTION 5. STOCK SUBJECT TO PLAN.
- --------- ---------------------
(a) Basic Limitation. Shares offered under the Plan shall be authorized
but unissued Shares or treasury Shares. The aggregate number of Shares which is
issued under the Plan (upon exercise of Options or other rights to acquire
Shares) shall not exceed 1,500,000 Shares plus the number of Shares remaining
available for awards under the Company's 1987 Employee Stock Plan (the "Prior
Plan") as of March 31, 1995. (No additional grants shall be made under the
Prior Plan after March 31, 1995.). On January 1 of the years 1996, 1997, 1998,
1999 and 2000, the aggregate number of Shares which may be issued under the Plan
(upon exercise of Options or other rights to acquire Shares) shall automatically
increase by a number of Shares equal to 3.5 percent of the total number of
Shares then outstanding, provided that the number of Shares which is issued
under the Plan upon exercise of ISOs shall in no event exceed 1,500,000 Shares
during the entire term of the Plan. All limitations under this Subsection (a)
shall be subject to adjustment pursuant to Sec-
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<PAGE>
tion 9. The number of Shares which are subject to Options or other rights
outstanding at any time under the Plan shall not exceed the number of Shares
which then remain available for issuance under the Plan. The Company, during
the term of the Plan, shall at all times reserve and keep available sufficient
Shares to satisfy the requirements of the Plan.
(b) Additional Shares. In the event that any outstanding option granted
under this Plan or the Prior Plan for any reason expires or is cancelled or
otherwise terminated, the Shares allocable to the unexercised portion of such
option shall become available for the purposes of this Plan. In the event that
Shares issued under this Plan or the Prior Plan are reacquired by the Company
pursuant to a forfeiture provision, a right of repurchase or a right of first
refusal, such Shares shall become available for the purposes of this Plan.
SECTION 6. TERMS AND CONDITIONS OF AWARDS OR SALES.
- --------- ---------------------------------------
(a) Stock Purchase Agreement. Each award or sale of Shares under the Plan
(other than upon exercise of an Option) shall be evidenced by a Stock Purchase
Agreement between the Offeree and the Company. Such award or sale shall be
subject to all applicable terms and conditions of the Plan and may be subject to
any other terms and conditions which are not inconsistent with the Plan and
which the Committee deems appropriate for inclusion in a Stock Purchase
Agreement. The provisions of the various Stock Purchase Agreements entered into
under the Plan need not be identical.
(b) Duration of Offers and Nontransferability of Rights. Any right to
acquire Shares under the Plan (other than an Option) shall automatically expire
if not exercised by the Offeree within 30 days after the grant of such right was
communicated to the Offeree by the Committee. Such right shall not be
transferable and shall be exercisable only by the Offeree to whom such right was
granted.
(c) Purchase Price. The Purchase Price of Shares to be offered under the
Plan shall not be less than the par value of such Shares. Subject to the
preceding sentence, the Purchase Price shall be determined by the Committee at
its sole discretion. The Purchase Price shall be payable in a form described in
Section 8.
(d) Withholding Taxes. As a condition to the award, sale or vesting of
Shares, the Offeree shall make such arrangements as the Committee may require
for the satisfaction of any federal, state, local or foreign withholding tax
obligations that arise in connection with such Shares. The Committee may permit
the Offeree to satisfy all or part of his or her tax obligations related to such
Shares by having the Company withhold a portion of any Shares that otherwise
would be issued to him or her or by surrendering any Shares that previously were
acquired by him or
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<PAGE>
her. The Shares withheld or surrendered shall be valued at their Fair Market
Value on the date when taxes otherwise would be withheld in cash. The payment
of taxes by assigning Shares to the Company, if permitted by the Committee,
shall be subject to such restrictions as the Committee may impose, including any
restrictions required by rules of the Securities and Exchange Commission.
(e) Restrictions on Transfer of Shares. Any Shares awarded or sold under
the Plan shall be subject to such special forfeiture conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall be set forth in the applicable
Stock Purchase Agreement and shall apply in addition to any general restrictions
that may apply to all holders of Shares.
SECTION 7. TERMS AND CONDITIONS OF OPTIONS.
- --------- -------------------------------
(a) Stock Option Agreement. Each grant of an Option under the Plan shall
be evidenced by a Stock Option Agreement executed by the Optionee and the
Company. Such Option shall be subject to all applicable terms and conditions of
the Plan and may be subject to any other terms and conditions which are not
inconsistent with the Plan and which the Committee deems appropriate for
inclusion in a Stock Option Agreement. The provisions of the various Stock
Option Agreements entered into under the Plan need not be identical.
(b) Number of Shares. Each Stock Option Agreement shall specify the
number of Shares that are subject to the Option and shall provide for the
adjustment of such number in accordance with Section 9. Options granted to any
Optionee in a single calendar year shall in no event cover more than 500,000
Shares, subject to adjustment in accordance with Section 9. The Stock Option
Agreement shall also specify whether the Option is an ISO or a Nonstatutory
Option.
(c) Exercise Price. Each Stock Option Agreement shall specify the
Exercise Price. The Exercise Price of an ISO shall not be less than 100 percent
of the Fair Market Value of a Share on the date of grant, except as otherwise
provided in Section 4(c). The Exercise Price of a Nonstatutory Option shall not
be less than the par value of a Share. Subject to the preceding two sentences,
the Exercise Price under any Option shall be determined by the Committee at its
sole discretion. The Exercise Price shall be payable in a form described in
Section 8.
(d) Withholding Taxes. As a condition to the exercise of an Option, the
Optionee shall make such arrangements as the Committee may require for the
satisfaction of any federal, state, local or foreign withholding tax obligations
that arise in connection with such exercise. The Optionee shall also make such
arrangements as the Committee may require for the satisfaction of any federal,
state, local or foreign withholding tax obligations
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<PAGE>
that may arise in connection with the disposition of Shares acquired by
exercising an Option. The Committee may permit the Optionee to satisfy all or
part of his or her tax obligations related to the Option by having the Company
withhold a portion of any Shares that otherwise would be issued to him or her or
by surrendering any Shares that previously were acquired by him or her. Such
Shares shall be valued at their Fair Market Value on the date when taxes
otherwise would be withheld in cash. The payment of taxes by assigning Shares
to the Company, if permitted by the Committee, shall be subject to such
restrictions as the Committee may impose, including any restrictions required by
rules of the Securities and Exchange Commission.
(e) Exercisability. Each Stock Option Agreement shall specify the date
when all or any installment of the Option is to become exercisable. The vesting
of any Option shall be determined by the Committee at its sole discretion. Each
Stock Option Agreement shall provide for immediate exercisability of the entire
Option in the event of a Change in Control or in the event of the Optionee's
death or Total and Permanent Disability. A Stock Option Agreement may also
provide for accelerated exercisability in the event of the Optionee's retirement
or upon other events.
(f) Term. Each Stock Option Agreement shall specify the term of the
Option. The term of an ISO shall not exceed 10 years from the date of grant,
except as otherwise provided in Section 4(c). Subject to the preceding
sentence, the Committee at its sole discretion shall determine when an Option is
to expire. A Stock Option Agreement may provide that the Option will expire
before the end of its normal term in the event that the Optionee's Service
terminates.
(g) Nontransferability. During an Optionee's lifetime, such Optionee's
Option(s) shall be exercisable only by him or her and shall not be transferable.
In the event of an Optionee's death, such Optionee's Option(s) shall not be
transferable other than by will, by written beneficiary designation or by the
laws of descent and distribution.
(h) No Rights as a Stockholder. An Optionee, or a transferee of an
Optionee, shall have no rights as a stockholder with respect to any Shares
covered by his or her Option until the date of the issuance of a stock
certificate for such Shares. No adjustments shall be made, except as provided
in Section 9.
(i) Modification, Extension and Renewal of Options. Within the
limitations of the Plan, the Committee may modify, extend or renew outstanding
Options or may accept the cancellation of outstanding Options (to the extent not
previously exercised) in return for the grant of new Options at the same or a
different price. The foregoing notwithstanding, no modification of an Option
shall, without the consent of the Optionee, impair such
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Optionee's rights or increase his or her obligations under such Option.
(j) Restrictions on Transfer of Shares. Any Shares issued upon exercise
of an Option may be subject to such special forfeiture conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall be set forth in the applicable
Stock Option Agreement and shall apply in addition to any general restrictions
that may apply to all holders of Shares.
SECTION 8. PAYMENT FOR SHARES.
- --------- ------------------
(a) General Rule. The entire Purchase Price or Exercise Price of Shares
issued under the Plan shall be payable in lawful money of the United States of
America at the time when such Shares are purchased, except as follows:
(i) Stock Purchases. In the case of Shares sold under the terms of a
Stock Purchase Agreement subject to the Plan, payment shall be made only
pursuant to the express provisions of such Stock Purchase Agreement.
However, the Committee (at its sole discretion) may specify in the Stock
Purchase Agreement that payment may be made in one or both of the forms
described in Subsections (e) and (f) below.
(ii) ISOs. In the case of an ISO granted under the Plan, payment
shall be made only pursuant to the express provisions of the applicable
Stock Option Agreement. However, the Committee (at its sole discretion)
may specify in the Stock Option Agreement that payment may be made pursuant
to Subsections (b), (c), (d) or (f) below.
(iii) Nonstatutory Options. In the case of a Nonstatutory Option
granted under the Plan, the Committee (at its sole discretion) may accept
payment pursuant to Subsections (b), (c), (d) or (f) below.
(b) Surrender of Stock. To the extent that this Subsection (b) is
applicable, payment may be made all or in part with Shares which have already
been owned by the Optionee or his or her representative for more than 12 months
and which are surrendered to the Company in good form for transfer. Such Shares
shall be valued at their Fair Market Value on the date when the new Shares are
purchased under the Plan.
(c) Exercise/Sale. To the extent that this Subsection (c) is applicable,
payment may be made by the delivery (on a form prescribed by the Company) of an
irrevocable direction to a securities broker approved by the Company to sell
Shares and to deliver all or part of the sales proceeds to the Company in
payment of all or part of the Exercise Price and any withholding taxes.
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(d) Exercise/Pledge. To the extent that this Subsection (d) is applicable,
payment may be made by the delivery (on a form prescribed by the Company) of an
irrevocable direction to pledge Shares to a securities broker or lender approved
by the Company, as security for a loan, and to deliver all or part of the loan
proceeds to the Company in payment of all or part of the Exercise Price and any
withholding taxes.
(e) Services Rendered. To the extent that this Subsection (e) is
applicable, Shares may be awarded under the Plan in consideration of services
rendered to the Company or a Subsidiary prior to the award. If Shares are
awarded without the payment of a Purchase Price in cash, the Committee shall
make a determination (at the time of the award) of the value of the services
rendered by the Offeree and the sufficiency of the consideration to meet the
requirements of Section 6(c).
(f) Promissory Note. To the extent that this Subsection (f) is
applicable, a portion of the Purchase Price or Exercise Price, as the case may
be, of Shares issued under the Plan may be payable by a full-recourse promissory
note, provided that (i) the par value of such Shares must be paid in lawful
money of the United States of America at the time when such Shares are
purchased, (ii) the Shares are security for payment of the principal amount of
the promissory note and interest thereon and (iii) the interest rate payable
under the terms of the promissory note shall be no less than the minimum rate
(if any) required to avoid the imputation of additional interest under the Code.
Subject to the foregoing, the Committee (at its sole discretion) shall specify
the term, interest rate, amortization requirements (if any) and other provisions
of such note.
SECTION 9. ADJUSTMENT OF SHARES.
- --------- --------------------
(a) General. In the event of a subdivision of the outstanding Stock, a
declaration of a dividend payable in Shares, a declaration of a dividend payable
in a form other than Shares in an amount that has a material effect on the value
of Shares, a combination or consolidation of the outstanding Stock (by
reclassification or otherwise) into a lesser number of Shares, a
recapitalization, a spinoff or a similar occurrence, the Committee shall make
appropriate adjustments in one or more of:
(i) The number of Shares available under Section 5 for future grants;
(ii) The limit set forth in Section 7(b);
(iii) The number of Nonstatutory Options to be granted to Outside
Directors under Section 4(b);
(iv) The number of Shares covered by each outstanding Option; or
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(v) The Exercise Price under each outstanding Option.
(b) Reorganizations. In the event that the Company is a party to a merger
or other reorganization, outstanding Options shall be subject to the agreement
of merger or reorganization. Such agreement may provide, without limitation,
for the assumption of outstanding Options by the surviving corporation or its
parent, for their continuation by the Company (if the Company is a surviving
corporation), for payment of a cash settlement equal to the difference between
the amount to be paid for one Share under such agreement and the Exercise Price,
or for the acceleration of their exercisability followed by the cancellation of
Options not exercised, in all cases without the Optionees' consent. Any
cancellation shall not occur until after such acceleration is effective and
Optionees have been notified of such acceleration.
(c) Reservation of Rights. Except as provided in this Section 9, an
Optionee or Offeree shall have no rights by reason of any subdivision or
consolidation of shares of stock of any class, the payment of any dividend or
any other increase or decrease in the number of shares of stock of any class.
Any issue by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number or
Exercise Price of Shares subject to an Option. The grant of an Option pursuant
to the Plan shall not affect in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or changes of its capital
or business structure, to merge or consolidate or to dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 10. SECURITIES LAWS.
- ---------- ---------------
Shares shall not be issued under the Plan unless the issuance and delivery
of such Shares complies with (or is exempt from) all applicable requirements of
law, including (without limitation) the Securities Act of 1933, as amended, the
rules and regulations promulgated thereunder, state securities laws and
regulations, and the regulations of any stock exchange on which the Company's
securities may then be listed.
SECTION 11. NO RETENTION RIGHTS.
- ---------- -------------------
Neither the Plan nor any Option shall be deemed to give any individual a
right to remain an employee or consultant of the Company or a Subsidiary. The
Company and its Subsidiaries reserve the right to terminate the service of any
employee or consultant at any time, with or without cause, subject to applicable
laws and a written employment agreement (if any).
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SECTION 12. DURATION AND AMENDMENTS.
- ---------- -----------------------
(a) Term of the Plan. The Plan, as set forth herein, shall become
effective as of May 10, 1995. The Plan, if not extended, shall terminate
automatically on March 11, 2005. It may be terminated on any earlier date
pursuant to Subsection (b) below.
(b) Right to Amend or Terminate the Plan. The Board of Directors may
amend, suspend or terminate the Plan at any time and for any reason, except that
the provisions of Section 4(b) relating to the amount, price and timing of
grants to Outside Directors shall not be amended more than once in any six-month
period. An amendment of the Plan shall be subject to the approval of the
Company's stockholders only to the extent required by applicable laws or
regulations.
(c) Effect of Amendment or Termination. No Shares shall be issued or sold
under the Plan after the termination thereof, except upon exercise of an Option
granted prior to such termination. The termination of the Plan, or any
amendment thereof, shall not affect any Share previously issued or any Option
previously granted under the Plan.
SECTION 13. EXECUTION.
- ---------- ---------
To record the amendment of the Plan by the Board of Directors on May 10,
1995, the Company has caused its authorized officer to execute the same.
NEXGEN, INC.
By _________________________
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EXHIBIT 99.3
NEXGEN, INC.
------------
1987 EMPLOYEE STOCK PLAN
------------------------
(as amended and restated as of July 7, 1993)
SECTION 1. ESTABLISHMENT AND PURPOSE.
- --------- -------------------------
The Plan was established in 1987 to offer selected employees, officers,
directors, consultants and promotional representatives of the Company or of a
Subsidiary an opportunity to acquire a proprietary interest in the success of
the Company, or to increase such interest, by purchasing Shares of the Company's
Common Stock. The Plan provides both for the direct sale of Shares and for the
grant of Options to purchase Shares. Options granted under the Plan may include
Nonstatutory Options as well as ISOs intended to qualify under section 422 of
the Code. The Plan was amended in August 1989 and January 1992, and was amended
and restated effective as of July 7, 1993 to read as set forth therein to comply
with the requirements of federal securities law when they become applicable, to
add provisions that will allow Optionees to exercise their Options on a cashless
basis, and to make certain administrative clarifications and changes.
SECTION 2. DEFINITIONS.
- --------- -----------
(a) "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Committee" shall mean a the committee designated by the Board of
Directors, which is authorized to administer the Plan under Section 3 hereof.
The Committee shall have membership composition which enables the Plan to
qualify under Rule 16b-3 with regard to the grant of Options or other rights
under the Plan to persons who are subject to Section 16 of the Exchange Act.
(d) "Company" shall mean NEXGEN, INC., a California corporation.
(e) "Employee" shall mean any individual who is (i) an employee (within
the meaning of section 3401(c) of the Code and the regulations thereunder),
including an officer, (ii) a director, (iii) a consultant, or (iv) a promotional
representative of the Company or of a Subsidiary.
<PAGE>
(f) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(g) "Exercise Price" shall mean the amount for which one Share may be
purchase upon exercise of an Option, as specified by the Committee in the
applicable Stock Option Agreement.
(h) "Fair Market Value" shall mean (i) the closing price of a Share on the
principal exchange which the Shares are trading, on the first trading day
immediately preceding the date on which the Fair Market Value is determined, or
(ii) if the Shares are not traded on an exchange but are quoted on NASDAQ or a
successor quotation system, the closing price on the first trading day
immediately preceding the date on which the Fair Market Value is determined, or
(iii) if the Shares are not traded on an exchange or quoted on the NASDAQ or a
successor quotation system, the fair market value of a Share, as determined by
the Committee in good faith. Such determination shall be conclusive and binding
on all persons.
(i) "ISO" shall mean an employee incentive stock option described in
section 422(b) of the Code.
(j) "Nonstatutory Option" shall mean an employee stock option that is not
an ISO.
(k) "Offeree" shall mean an individual to whom the Committee has offered
the right to purchase Shares under the Plan (other than upon exercise of an
Option).
(l) "Option" shall mean an ISO or Nonstatutory Option granted under the
Plan and entitling the holder to purchase Shares.
(m) "Optionee" shall mean an individual who holds an Option.
(n) "Plan" shall mean this NexGen, Inc. 1987 Employee Stock Plan, as
amended from time to time.
(o) "Purchase Price" shall mean the amount for which one Share may be
purchased under the Plan (other than upon exercise of an Option), as specified
by the Committee.
(p) "Service" shall mean service as an Employee.
(q) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 9 (if applicable).
(r) "Stock" shall mean the Common Stock of the Company.
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<PAGE>
(s) "Stock Option Agreement" shall mean the agreement between the Company
and an Optionee which contains the terms, conditions and restrictions pertaining
to his Option.
(t) "Stock Purchase Agreement" shall mean the agreement between the
Company and an Offeree who elects to purchase Shares under the Plan which
contains the terms, conditions and restrictions pertaining to the purchase of
such Shares.
(u) "Subsidiary" shall mean any corporation, if the Company and/or one or
more other Subsidiaries own not less than 50 percent of the total combined
voting power of all classes of outstanding stock of such corporation. A
corporation that attains the status of a Subsidiary on a date after the adoption
of the Plan shall be considered a Subsidiary commencing as of such date.
(v) "Test Rate" shall mean the lower rate of interest which will not
result in the imputation of additional interest under any applicable provision
of the Code.
(w) "Total and Permanent Disability" shall mean that the Optionee is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period
of not less than 12 months.
SECTION 3. ADMINISTRATION.
- --------- --------------
(a) Committee Procedures. The Board of Directors shall designate one of
the members of the Committee as chairman. The Committee may hold meetings at
such times and places as it shall determine. The acts of a majority of the
Committee members present at meetings at which a quorum exists, or acts reduced
to or approved in writing by a majority of all Committee members, shall be valid
acts of the Committee.
(b) Committee Responsibilities. Subject to the provisions of the Plan,
the Committee shall have full authority and discretion to take the following
actions:
(i) To interpret the Plan and to apply its provisions;
(ii) To adopt, amend or rescind rules, procedures and forms relating
to the Plan;
(iii) To authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan;
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<PAGE>
(iv) To determine when Shares are to be offered for sale and when
Options are to be granted under the Plan;
(v) To select the Offerees and Optionees;
(vi) To determine the number of Shares to be offered to each Offeree
or to be made subject to each Option;
(vii) To prescribe the terms and conditions of each sale of Shares,
including (without limitation) the Purchase Price, and to specify the
provisions of the Stock Purchase Agreement relating to such sale;
(viii) To prescribe the terms and conditions of each Option,
including (without limitation) the Exercise Price, to determine whether
such Option is to be classified as an ISO or as a Nonstatutory Option, and
to specify the provisions of the Stock Option Agreement relating to such
Option;
(ix) To amend any outstanding Stock Purchase Agreement or Stock
Option Agreement, subject to applicable legal restrictions and to the
consent of the Offeree or Optionee who entered into such agreement;
(x) To prescribe the consideration for the grant of each Option or
other right under the Plan and to determine the sufficiency of such
consideration;
(xi) To determine the disposition of each Option or other right under
the Plan in the event of an Optionee's or Offeree's divorce or dissolution
of marriage;
(xii) To determine whether Options or other rights under the Plan will
be granted in replacement of other grants under an incentive or other
compensation plan of an acquired business;
(xiii) To correct any defect, supply any omission, or reconcile any
inconsistency in the Plan, any Stock Option Agreement or any Stock Purchase
Agreement; and
(xiv) To take any other actions deemed necessary or advisable for the
administration of the Plan.
Subject to the requirements of applicable law, the Committee may designate
persons other than members of the Committee to carry out its responsibilities
and may prescribe such conditions and limitations as it may deem appropriate,
except that the Committee may not delegate its authority with regard to the
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<PAGE>
selection for participation of or the granting of Options or other rights under
the Plan to persons subject to Section 16 of the Exchange Act. All decisions,
interpretations and other actions of the Committee shall be final and binding on
all Offerees, all Optionees, and all persons deriving their rights from an
Offeree or Optionee. No member of the Committee shall be liable for any action
that he has taken or has failed to take in good faith with respect to the Plan,
any Option, or any right to purchase Shares under the Plan.
(c) Financial Reports. To the extent required by applicable law, and
not less often than annually, the Company shall furnish to Optionees and
Offerees reports of its financial condition, unless such Optionees and Offerees
have access to equivalent information through their employment. Such reports
need not be audited.
SECTION 4. ELIGIBILITY.
- --------- -----------
(a) General Rule. Only Employees, as defined in Section 2(e), shall
be eligible for designation as Offerees or Optionees by the Committee. All
Employees shall be eligible for the grant of Nonstatutory Options and the direct
sale of Shares. Only common-law employees of the Company or of a Subsidiary
shall be eligible for the grant of ISOs.
(b) Ten-Percent Shareholders. To the extent required by applicable
law, an Employee who owns more than 10 percent of the total combined voting
power of all classes of outstanding stock of the Company or any of its
Subsidiaries shall not be eligible for the grant of an ISO or a Nonstatutory
Option unless (i) the Exercise Price under such ISO or Nonstatutory Option is at
least 110 percent of the Fair Market Value of a Share on the date of grant and
(ii) in the case of an ISO, such ISO by its terms is not exercisable after the
expiration of five years from the date of grant.
(c) Attribution Rules. For purposes of Subsection (b) above, in
determining stock ownership, an Employee shall be deemed to own the stock owned,
directly or indirectly, by or for his brothers, sisters, spouse, ancestors and
lineal descendants. Stock owned, directly or indirectly, by or for a
corporation, partnership, estate or trust shall be deemed to be owned
proportionately by or for its shareholders, partners or beneficiaries. Stock
with respect to which such Employee holds an option shall not be counted.
(d) Outstanding Stock. For purposes of Subsection (b) above,
"outstanding stock" shall include all stock actually issued and outstanding
immediately after the grant. "Outstanding stock" shall not include reacquired
shares or shares authorized for issuance under outstanding options held by the
Optionee or by any other person.
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<PAGE>
SECTION 5. STOCK SUBJECT TO PLAN.
--------- ---------------------
(a) Basic Limitation. Shares offered under the Plan shall be
authorized but unissued Shares. The aggregate number of Shares which may be
issued under the Plan (upon exercise of Options or other rights to purchase
Shares) shall not exceed 5,210,000 Shares, subject to adjustment pursuant to
Section 9. To the extent required by applicable law, the number of Shares
which may be issued from time to time under the Plan (upon exercise of Options
or other rights to purchase Shares) shall not in the aggregate (inclusive of
prior outstanding issuances under the Plan) exceed 30% of the then (upon the
date of such issuance) outstanding stock of the Company (treating for purposes
of this computation, all shares of Preferred Stock of the Company as having been
converted into Stock on the date of such issuance). The number of Shares which
are subject to Options or other rights outstanding at any time under the Plan
shall not exceed the number of Shares which then remain available for issuance
under the Plan. The Company, during the term of the Plan, shall at all times
reserve and keep available sufficient Shares to satisfy the requirements of the
Plan.
(b) Additional Shares. In the event that any outstanding Option or
other right for any reason expires or is canceled or otherwise terminated, the
Shares allocable to the unexercised portion of such Option or other right shall
again be available for the purposes of the Plan. In the event that Shares
issued under the Plan are repurchased by the Company pursuant to a right of
repurchase or a right of first refusal, such Shares shall again be available for
the purposes of the Plan.
SECTION 6. TERMS AND CONDITIONS OF DIRECT SALES.
- --------- ------------------------------------
(a) Stock Purchase Agreement. Each sale of Shares under the Plan
(other than upon exercise of an Option) shall be evidenced by a Stock Purchase
Agreement between the Offeree and the Company. Such sale shall be subject to
all applicable terms and conditions of the plan and may be subject to any other
terms and conditions which are not inconsistent with the Plan and which the
Committee deems appropriate for inclusion in a Stock Purchase Agreement. The
provisions of the various Stock Purchase Agreements entered into under the Plan
need not be identical.
(b) Duration of Offers and Nontransferability of Rights. Any right
to purchase Shares under the Plan (other than an Option) shall automatically
expire if not exercised by the Offeree within 30 days after the grant of such
right was communicated to him by the Committee. Such right shall not be
transferable and shall be exercisable only by the Offeree to whom such right was
granted.
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<PAGE>
(c) Purchase Price. While the Plan is subject to California Code of
Regulations section 260.140, Subarticle 4, the Purchase Price of Shares to be
offered for sale under the Plan shall not be less than 100 percent of the Fair
Market Value of such Shares on the date of the offer. Subject to the preceding
sentence, the Purchase Price shall be determined by the Committee at its sole
discretion. The Purchase Price shall be payable in accordance with Section 8.
(d) Restrictions on Transfer of Shares. Any Shares sold under the
Plan shall be subject to such special rights of repurchase, rights of first
refusal and other transfer restrictions as the Committee may determine. Such
restrictions shall be set forth in the applicable Stock Purchase Agreement and
shall apply in addition to any general restrictions that may apply to all
holders of Shares.
SECTION 7. TERMS AND CONDITIONS OF OPTIONS.
- --------- -------------------------------
(a) Stock Option Agreement. Each grant of an Option under the Plan
shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms and conditions of
the Plan and may be subject to any other terms and conditions which are not
inconsistent with the Plan and which the Committee deems appropriate for
inclusion in a Stock Option Agreement. The provisions of the various Stock
Option Agreements entered into under the Plan need not be identical.
(b) Number of Shares. Each Stock Option Agreement shall specify the
number of Shares that are subject to the Option and shall provide for the
adjustment of such number in accordance with Section 9. The Stock Option
Agreement shall also specify whether the Option is an ISO or a Nonstatutory
Option.
(c) Exercise Price. Each Stock Option Agreement shall specify the
Exercise Price. The Exercise Price of an ISO shall not be less than 100 percent
of the Fair Market Value of a Share on the date of grant and shall comply with
Section 4(b). To the extent required by applicable law, the Exercise Price of a
Nonstatutory Option shall not be less than 85 percent of the Fair Market Value
of a Share on the date of grant. Subject to the foregoing provisions of this
subsection, the Exercise Price under any Option shall be determined by the
Committee at its sole discretion. The Exercise Price shall be payable in
accordance with Section 8.
(d) Withholding Taxes. As a condition to the exercise of an Option,
the Optionee shall make such arrangements as the Committee may require for the
satisfaction of any federal, state or local withholding tax obligations that may
arise in connection with such exercise. The Optionee shall also
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<PAGE>
make such arrangements as the Committee may require for the satisfaction of any
federal, state or local withholding tax obligations that may arise in connection
with the disposition of Shares acquired by exercising an Option.
(e) Exercisability and Term. Each Stock Option Agreement shall
specify the date when all or any installment of the Option is to become
exercisable.
The Stock Option Agreement shall also specify the term of the Option. To
the extent required by applicable law, the term shall not exceed 120 months from
the date of grant, except as otherwise provided in Section 4(b). Subject to the
foregoing provisions of this subsection, the Committee at its sole discretion
shall determine when all or any part of an Option is to become exercisable and
when such Option is to expire.
(f) Nontransferability. During an Optionee's lifetime, his Option(s)
shall be exercisable only by him and shall not be transferable. In the event of
an Optionee's death, his Option(s) shall not be transferable other than by will
or by the laws of descent and distribution.
(g) Exercise of Options Upon Termination of Service. Subject to the
requirements of Subsections 7(h) and (j) below, each Stock Option Agreement
shall set forth the extent to which the Optionee shall have the right to
exercise the Option following termination of the Optionee's Service with the
Company and its Subsidiaries. Such provisions shall be determined in the sole
discretion of the Committee, need not be uniform among all Options issued
pursuant to the Plan, and may reflect distinctions based on the reasons for
termination of Service.
(h) Termination of Service (Except by Death). To the extent required
by applicable law, if an Optionee's Service terminates for any reason other than
his death, then his Option(s) shall expire on the earliest of the following
occasions:
(i) The expiration date determined pursuant to Subsection (e) above;
(ii) The date three months following the termination of his Service
for any reason other than Total and Permanent Disability; or
(iii) The close of the sixth month following the termination of his
Service by reason of Total and Permanent Disability.
The Optionee may exercise all or part of his Option(s) at any time before the
expiration of such Option(s) under the preceding sentence, but only to the
extent that such Option(s) had become
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<PAGE>
exercisable before his Service terminated. The balance of such Option(s) shall
lapse when the Optionee's Service terminates. In the event that the Optionee
dies after the termination of his Service but before the expiration of his
Option(s), all or part of such Option(s) may be exercised (prior to expiration)
by the executors or administrators of the Optionee's estate or by any person who
has acquired such Option(s) directly from him by bequest or inheritance, but
only to the extent that such Option(s) had become exercisable before his Service
terminated.
(i) Leaves of Absence. For purposes of Subsection (h) above, Service
shall be deemed to continue while the Optionee is on military leave, sick leave
or other bona fide leave of absence (as determined by the Committee). The
foregoing notwithstanding, in the case of an ISO granted under the Plan, Service
shall not be deemed to continue beyond the first 90 days of such leave, unless
the Optionee's reemployment rights are guaranteed by statute or by contract.
(j) Death of Optionee. To the extent required by applicable law, if
an Optionee dies while he is in Service, then his Option(s) shall expire on the
earlier of the following dates:
(i) The expiration date determined pursuant to Subsection (e) above;
or
(ii) The date 12 months after his death.
All or part of the Optionee's Option(s) may be exercised at any time before the
expiration of such Option(s) under the preceding sentence by the executors or
administrators of his estate or by any person who has acquired such Option(s)
directly from him by bequest or inheritance, but only to the extent that such
Option(s) had become exercisable before his death. The balance of such
Option(s) shall lapse when the Optionee dies.
(k) No Rights as a Shareholder. As Optionee, or a transferee of an
Optionee, shall have no rights as a shareholder with respect to any Share
covered by his Option until the date of the issuance of a stock certificate for
such Shares. No adjustment hall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property), distributions or
other rights for which the record date is prior to the date when such stock
certificate is issued, except as provided in Section 9.
(l) Modification, Extension and Renewal of Options. Within the
limitations of the Plan, the Committee may modify, extend or renew outstanding
Options or may accept the cancellation of outstanding Options (to the extent not
previously exercised) for the granting of new Options in substitution therefor.
The foregoing notwithstanding, no
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<PAGE>
modification of an Option shall, without the consent of the Optionee, alter or
impair his rights or obligations under such Option.
(m) Restrictions on Transfer of Shares. Any Share issued upon
exercise of an Option shall be subject to such special rights of repurchase,
rights of first refusal and other transfer restrictions as the Committee may
determine. Such restrictions as the Committee may determine. Such restrictions
shall be set forth in the applicable Stock Option Agreement and shall apply in
addition to any general restrictions that may apply to all holders of Shares.
SECTION 8. PAYMENT FOR SHARES.
- --------- ------------------
(a) General Rule. The entire Purchase Price or Exercise Price of
Shares issued under the Plan shall be payable in cash at the time when such
Shares are purchased, except as follows:
(i) In the case of an ISO granted under the Plan, payment shall be
made only pursuant to the express provisions of the applicable Stock Option
Agreement. However, the Committee (at its sole discretion) may specify in
the Stock Option Agreement that payment may be made in one or all of the
forms described in Subsections (b), (c) and (d) below for all or any part
of the Exercise Price.
(ii) In all other cases, the Committee (at its sole discretion) may
accept payment in one or all of the forms described in Subsections (b), (c)
and (d) below for all or any part of the Purchase Price or Exercise Price.
(b) Surrender of Stock. To the extent that this Subsection (b) is
applicable, payment may be made with Shares which have already been owned by the
Offeree or Optionee for more than 12 months and which are surrendered to the
Company in good form for transfer. Such Shares shall be valued at their Fair
Market Value on the date when the new Shares are purchased under the Plan.
(c) Promissory Note. To the extent that this Subsection (c) is
applicable, payment may be made with a full-recourse promissory note executed by
the Offeree or Optionee. Such note shall bear interest at a rate not less than
the applicable Test Rate. Subject to the preceding sentence, the Committee (at
its sole discretion) shall specify the term, interest rate, amortization
requirements (if any), and other provisions of such note. The Committee may
require that the Offeree or Optionee pledge his Shares to the Company for the
purpose of securing the payment of such note, and the Committee
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may require that the certificate(s) representing such Shares be held in escrow
in order to perfect the Company's security interest. In addition, the Committee,
with respect to any Offeree or Optionee who, when the note is to be executed, is
not (i) a common-law employee of the Company or a Subsidiary or (ii) a member of
the Board of Directors, shall require that such note be adequately secured by
collateral other than such Shares.
(d) Cashless Exercise. To the extent that a Stock Option Agreement so
provides, payment may be made all or in part by delivery (on a form prescribed
by the Committee) of an irrevocable direction to a securities broker to sell
Shares and to deliver all or part of the sale proceeds to the Company in payment
of the aggregate Exercise Price.
SECTION 9. ADJUSTMENT OF SHARES.
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(a) In the event that the outstanding Shares are hereafter increased
or decreased, or changed into or exchanged for a different number or kind of
shares or other securities of the Company or of another corporation, by reason
of a reorganization, merger, consolidation, recapitalization, reclassification,
stock split, combination of shares or declaration of stock dividends, the total
number and/or kind of Shares for the purchase of which rights or Options may be
granted under the Plan, and the number and/or kind of Shares as to which Options
(or portions thereof) are outstanding, shall, to the extent required by
applicable law, be adjusted proportionately by the Committee. Any adjustment of
an outstanding Option shall be made without a change in the total Exercise Price
applicable to the unexercised portion of such Option and with a corresponding
adjustment in the Exercise Price per Share. Any adjustment under this Section 9
shall be subject to the provisions of the Company's Articles of Incorporation,
as amended, and applicable law.
(b) Reorganizations. A dissolution or liquidation of the Company or
a merger or consolidation in which the Company is not the surviving corporation
shall cause the Plan to terminate, unless the agreement of merger or
consolidation provides for the assumption by the surviving corporation of
options granted under the Plan. If the agreement of merger or consolidation
does not provide for the assumption by the surviving corporation of options
granted under the Plan, options granted under the Plan shall be exercisable in
full immediately prior to the closing of such merger or consolidation.
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SECTION 10. REGULATORY APPROVALS AND LISTINGS.
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Notwithstanding any other provision in the Plan, the Company shall
have no obligation to issue or deliver Shares under the Plan prior to (i)
obtaining approval from any governmental agency which the Company determines is
necessary or advisable, (ii) admitting such shares to listing on any stock
exchange on which the Common Stock may be listed, and (iii) completing any
registration or other qualification of such shares under any state or Federal
law or ruling of any governmental body which the Company determines to be
necessary or advisable.
SECTION 11. NO EMPLOYMENT RIGHTS.
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No provision of the Plan, nor any right or Option granted under the
Plan, shall be construed as giving any person the right (a) to become or to be
treated as an Employee as defined in Section 2(e)(i) if such person is an
Employee as defined in Section 2(e)(ii), (iii) or (iv), or (b) to remain an
Employee as defined in Section 2(e). The Company and its Subsidiaries reserve
the right to terminate any person's Service at any time, with or without cause.
SECTION 12. DURATION AND AMENDMENTS.
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(a) Term of the Plan. The Plan, as set forth herein, became
effective on January 17, 1987, subject to the approval of the Company's
shareholders. The Plan shall terminate automatically on January 17, 1997, and
may be terminated on any earlier date pursuant to Subsection (b) below.
(b) Rights to Amend or Terminate the Plan. The Board of Directors
may amend, suspend or terminate the Plan at any time, from time to time, and for
any reason. AN AMENDMENT OF THE PLAN SHALL BE SUBJECT TO THE APPROVAL OF THE
COMPANY'S STOCKHOLDERS, BUT ONLY TO THE EXTENT REQUIRED BY APPLICABLE LAWS,
REGULATIONS OR RULES.
(c) Effect of Amendment of Termination. No Shares shall be issued or
sold under the Plan after the termination thereof, except upon exercise of an
Option granted prior to such termination. The termination of the Plan, or any
amendment thereof (including the amendment and restatement set forth herein),
shall not affect any Share previously issued and sold or any Option previously
granted under the Plan.
SECTION 13. USE OF PROCEEDS.
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All cash proceeds received by the Company from the sale of Shares
under the Plan shall be used for general corporate purposes.
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SECTION 14. EXECUTION.
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To record the adoption of this amended and restated Plan by the Board
of Directors as of July 7, 1993, the Company has caused its authorized officer
to execute the same.
NEXGEN, INC.
By /s/ S. Atiq Raza
---------------------------
S. Atiq Raza, as its
President
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