As Filed With the Securities and Exchange Commission on January 26, 1996
Registration No. 33-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON. D.C. 20549
_________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_________________
AST RESEARCH, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 95-3525565
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
16215 ALTON PARKWAY, IRVINE, CALIFORNIA 92718
(Address of Principal Executive Offices) (Zip Code)
________________________
PRESIDENT'S PLAN
(Full title of the plan)
________________________
Ian W. Diery, President and Chief Executive Officer
AST Research, Inc.
16215 Alton Parkway
Irvine, California 92718
(Name and address of agent for service)
(714) 727-4141
(Telephone number, including area code, of agent for service)
Copy to:
Nick E. Yocca, Esq.
Stradling, Yocca, Carlson & Rauth, a Professional Corporation
660 Newport Center Drive, Suite 1600, Newport Beach, California 92660
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=====================================================================================================
Proposed Maximum Proposed Maximum
Title of Securities Amount To Be Offering Aggregate Offering Amount of
To Be Registered Registered (1) Price Per Share Price Registration Fee
=====================================================================================================
<S> <C> <C> <C> <C>
Common Stock, 1,000,000 $9.375 (2) $9,375,000.00 (2) $3,233.00
$0.01 par value shares
=====================================================================================================
</TABLE>
(1) Includes such additional shares of Common Stock that may become issuable
pursuant to the anti-dilution adjustment provisions of the President's Plan
(the "Plan").
(2) In accordance with Rule 457(h), the aggregate offering price of 1,000,000
shares of Common Stock registered hereby which would be issued upon
exercise of options granted under the Plan is based upon the per share
exercise price of such options.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
- -------------------------------------------------
The following documents are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K for its fiscal year ended
July 1, 1995.
(b) The Registrant's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1995.
(c) All other reports filed by the Registrant pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
since the end of the fiscal year covered by the Prospectus referred to in (a)
above.
(d) The description of the Registrant's Common Stock that is contained in
the Registrant's Registration Statement on Form 8-B filed under Section 12 of
the Exchange Act, including any amendment or report filed for the purpose of
updating that description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all of such securities then remaining unsold, shall be
deemed to be incorporated herein by reference and to be a part hereof from the
date of filing of such documents, except as to any portion of any future annual
or quarterly report to stockholders or document that is not deemed filed under
such provisions. For the purposes of this registration statement, any statement
in a document incorporated by reference shall be deemed to be modified or
superseded to the extent that a statement contained in this registration
statement modifies or supersedes a statement in such document. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this registration statement.
Item 4. Description of Securities.
- -----------------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
- ------------------------------------------------
Not applicable.
Item 6. Indemnification of Directors and Officers.
- ---------------------------------------------------
(a) As permitted by the Delaware General Corporation Law, the Registrant's
Certificate of Incorporation eliminates the liability of directors to the
Registrant or its stockholders for monetary damages for breach of fiduciary duty
as a director, except to the extent otherwise required by the Delaware General
Corporation Law.
(b) The Certificate of Incorporation provides that the Registrant will
indemnify each person who was or is made a party to any proceeding by reason of
the fact that such person is or was a director or officer of the Registrant
against all expense, liability and loss reasonably incurred or suffered by such
person in connection therewith to the fullest extent authorized by the Delaware
General Corporation Law. The Registrant's Bylaws provide for a similar
indemnity to directors and officers of the Registrant to the fullest extent
authorized by the Delaware General Corporation Law.
(c) The Certificate of Incorporation also gives the Registrant the ability
to enter into indemnification agreements with each of its officers and
directors. The Registrant has entered into indemnification agreements with each
of its directors and executive officers. The indemnification agreements provide
for the indemnification of directors and officers of the Registrant against any
and all expenses, judgments, fines, penalties and amounts paid in settlement, to
the fullest extent permitted by law.
Item 7. Exemption from Registration Claimed.
- ---------------------------------------------
Not applicable.
Item 8. Exhibits.
- ------------------
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
Number Description
------ -----------
<C> <S>
4.1 AST Research, Inc. President's Plan
(comprised of resolutions adopted by the Board of
Directors of the Registrant on November 2, 1995).
4.2 Form of Nonqualified Stock Option Agreement
issued to Ian W. Diery on November 2, 1995
covering an aggregate of 300,000 shares of Common
Stock under the President's Plan.
4.3 Form of Nonqualified Stock Option Agreement
issued to Ian W. Diery on November 2, 1995
covering an aggregate of 700,000 shares of Common
Stock under the President's Plan.
5.1 Opinion of Stradling, Yocca, Carlson & Rauth,
a Professional Corporation, Counsel to the
Registrant.
23.1 Consent of Stradling, Yocca, Carlson & Rauth,
a Professional Corporation (included in the
Opinion filed as Exhibit 5.1).
23.2 Consent of Ernst & Young LLP, independent
auditors.
24.1 Power of Attorney (included on signature page
to the Registration Statement at page S-1).
</TABLE>
Item 9. Undertakings.
- ----------------------
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this 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.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) shall not
apply if the information required to be included in a post-effective amendment
by these 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, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the 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
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Irvine, State of California, on the 26th day of
January, 1996.
AST RESEARCH, INC.
By: Ian Diery
President and Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of AST Research, Inc., do hereby
constitute and appoint Ian W. Diery and Dennis R. Leibel, or either of them, our
true and lawful attorneys-in-fact and agents, each with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and to file the same, with exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite or necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that each of said
attorneys-in-fact and agents, or his substitute or substitutes, may lawfully do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
- --------- ----- ----
Ian W. Diery President, Chief Executive January 26, 1996
Officer and Director
(Principal Executive Officer and
Acting Principal Financial Officer)
Mark P. de Raad Vice President, Controller and January 26, 1996
Principal Accounting Officer
(Principal Accounting Officer)
Safi U. Qureshey Chairman of the Board and Director January 26, 1996
Hoon Choo Director January 26, 1996
Richard J. Goeglein Director January 26, 1996
Kwang-Ho Kim Director January 26, 1996
Young Soo Kim Director January 26, 1996
Jack W. Peltason Director January 26, 1996
Carmelo J. Santoro Director January 26, 1996
Won Suk Yang Director January 26, 1996
Hee Dong Yoo Director January 26, 1996
UNANIMOUS WRITTEN CONSENT OF THE
BOARD OF DIRECTORS OF
AST RESEARCH, INC.
NOVEMBER 2, 1995
The undersigned, constituting the entire Board of Directors of AST
Research, Inc., a Delaware corporation (the "Corporation"), acting pursuant to
the authority of Section 141(f) of the General Corporation Law of the State of
Delaware, hereby adopt the following recitals and resolutions:
Authorized Number of Directors
WHEREAS, pursuant to subparagraph (b) of Article 5
of the Corporation's Restated Certificate of Incorporation,
the Board of Directors may from time to time fix the exact
number of directors of the Corporation within a range of not
less than five nor more than 13 members of the Board of
Directors; and
WHEREAS, it has been proposed that the exact
number of directors be fixed at eleven (11);
NOW, THEREFORE, BE IT RESOLVED, that the size of
the Corporation's Board of Directors is hereby fixed at
eleven (11) members, subject to further action of this Board
of Directors; and
RESOLVED FURTHER, that the officers of the
Corporation be, and they hereby are, authorized to execute
and deliver such documents and instruments and to do and
perform such deeds and acts as they may deem necessary or
advisable in order to carry out the purposes of these
resolutions; and
RESOLVED FURTHER, that the Secretary or any
Assistant Secretary of the Corporation is hereby authorized
by and on behalf of the Corporation to certify as to the
adoption of the foregoing resolutions.
Election of Ian Diery as a Director
WHEREAS, it has been proposed that Ian Diery be
elected to the Board of Directors and the election of Mr.
Diery to the Board of Directors is deemed to be in the best
interests of the Corporation and all of its stockholders;
and
WHEREAS, the election of Mr. Diery to the Board of
Directors will not violate the terms or provisions of the
Stockholder Agreement dated as of July 31, 1995 between the
Corporation and Samsung Electronics Corporation;
NOW, THEREFORE, BE IT RESOLVED, that, acting
pursuant to the authority of Article III , Section 3 of the
Bylaws of this Corporation, this Board of Directors here
appoints Ian Diery to the Corporation's Board of Directors;
and
RESOLVED FURTHER, that Mr. Diery be named in the
slate of management's nominees in the proxy materials
submitted to the Securities and Exchange Commission ("SEC")
and distributed to stockholders in connection with the
Corporation's Annual Meeting of Stockholders scheduled to be
held on January 25, 1996.
Resignation of Safi U. Qureshey as Chief Executive Officer
BE IT RESOLVED, that this Board of Directors
hereby accepts the resignation of Safi U. Qureshey as Chief
Executive Officer, effective as of November 2, 1995.
Election of Ian Diery as President and Chief Executive Officer
WHEREAS, it has been proposed that Ian Diery be
elected to the office of President and Chief Executive
Officer to fill the vacancy created by the resignation of
Safi U. Qureshey;
NOW, THEREFORE, BE IT RESOLVED, that Ian Diery be,
and he hereby is, elected to the corporate office of
President and Chief Executive Officer, effective November 2,
1995, subject to further action of this Board of Directors;
and
RESOLVED FURTHER, that, in order to ensure
continued full compliance on the part of this Corporation
and its officers with the rules and regulations promulgated
by the SEC, including specifically compliance with the
reporting and other requirements imposed on affiliates of
the Corporation pursuant to Section 16 of the Securities
Exchange Act of 1934 (the "1934 Act") and Rule 144
promulgated under the Securities Act of 1933 (the "1933
Act"), Mr. Diery shall be treated by the Corporation as an
"affiliate" of the Corporation for purposes of SEC reporting
and other requirements, and, accordingly, is hereby
instructed to prepare and file a Form 3 within ten (10) days
of the effective date of his appointment; and
RESOLVED FURTHER, that the terms of Mr. Diery's
engagement by the Corporation, as set forth in the letter
agreement dated October 31, 1995 (the "Diery Engagement
Letter"), a copy of which is attached hereto as Exhibit A
and incorporated herein by this reference, be, and they
hereby, ratified and confirmed in all respects, and the
actions of management in negotiating the terms of Mr.
Diery's engagement are hereby ratified and confirmed in all
respects; and
RESOLVED FURTHER, that the officers of the
Corporation be, and they hereby are, authorized to prepare,
or cause to be prepared, and to execute and deliver a
Severance Compensation Agreement between the Corporation and
Mr. Diery, such agreement to provide severance benefits
equal to two years' salary and target bonus following any
"change in control" transaction and such agreement to be
substantially in the form heretofore approved by this Board
of Directors, except as may be set forth herein and in the
Diery Engagement Letter and except for such changes or
modifications as may be approved by the officer or officers
executing the same on behalf of the Corporation, such
approval to be conclusively evidenced by the execution or
delivery thereof.
Nonqualified Stock Options under the President's Plan
WHEREAS, it has been proposed that this
Corporation adopt a plan and issue nonqualified stock
options covering an aggregate of 1,000,000 shares of the
Corporation's Common Stock, $0.01 par value per share (the
"Common Stock"), to Ian Diery, substantially on the terms
set forth in the Diery Engagement Letter; and
WHEREAS, it is deemed to be in the best interests
of this Corporation and all its stockholders that this
Corporation adopt such plan and issue options thereunder;
NOW, THEREFORE, BE IT RESOLVED, that this Board of
Directors hereby adopts a plan to be designated as the
"President's Plan," and authorizes the officers of the
Corporation to develop and prepare or cause to be developed
and prepared the forms of Nonqualified Stock Option
Agreements to be used under the President's Plan, and this
Board of Directors hereby approves the forms to be so
developed and prepared, all of which will cover the option
and purchase of up to an aggregate of 1,000,000 shares of
the Common Stock to the President of the Corporation; and
RESOLVED FURTHER, that these resolutions and the
form of Nonqualified Stock Option Agreements used hereunder
shall comprise the President's Plan and, pursuant to the
President's Plan, nonqualified stock options covering an
aggregate of 1,000,000 shares of Common Stock are hereby
granted to Ian Diery, exercisable at $9.375 per share, which
price is hereby determined to be the per share fair market
value of the Common Stock on the date hereof; and
RESOLVED FURTHER, that the foregoing grant to Ian
Diery of nonqualified stock options shall be effected as
more specifically set forth in the Diery Engagement Letter,
and shall include the grant to him of nonqualified stock
options on the foregoing terms covering an aggregate of
300,000 shares of Common Stock that shall vest ratably over
a period of four years from the date hereof and the grant to
him of nonqualified stock options on the foregoing terms
covering an aggregate of 700,000 shares of Common Stock that
shall vest ratably over a period of eight years, subject to
earlier vesting as follows:
1/3 of the shares (inclusive of any shares that
have already vested) upon the Corporation's stock
price reaching (and sustaining for a three-month
average) at least $21.00 per share;
1/3 of the shares (inclusive of any shares that
have already vested) upon the Corporation's stock
price reaching (and sustaining for a three-month
average) at least $30.00 per share; and
1/3 of the shares (inclusive of any shares that
have already vested) upon the Corporation's stock
price reaching (and sustaining for a three-month
average) at least $40.00 per share.
RESOLVED FURTHER, that these resolutions and the
proposed issuance of nonqualified stock options shall
comprise an employee stock option plan or agreement for all
purposes under theCalifornia Corporations Code, including
Section 408(a) thereof, and the U.S. Securities Laws, and
that only the Corporation's President, namely Ian Diery,
shall be entitled to participate in the President's Plan;
and
RESOLVED FURTHER, that 1,000,000 shares of the
Corporation's Common Stock are hereby reserved for issuance
under and pursuant to the terms of the President's Plan and,
when the purchase price therefor shall have been received,
as determined from time to time by the Corporation, shall be
duly and validly issued, fully paid and nonassessable shares
of the Corporation's Common Stock, and that the
consideration so received for such shares shall be credited
to the appropriate Common Stock or other capital accounts of
the Corporation; and
RESOLVED FURTHER, that the officers of the
Corporation be, and they hereby are, authorized and directed
to prepare or have prepared a Registration Statement on Form
S-8 (the "Registration Statement") under the 1933 Act,
relating to the President's Plan covering the shares of
Common Stock issuable under the President's Plan, and the
appropriate officers of the Corporation are authorized and
directed, in the name and on behalf of the Corporation, to
execute and cause to be filed with the SEC under the 1933
Act such Registration Statement (including the exhibits
listed therein), with such changes therein and additions
thereto as such officers may, with the advice of counsel,
approve, the filing thereof to be conclusive evidence of
their approval, and to execute and cause to be filed with
the SEC all such amendments to such Registration Statement
and all certificates, exhibits, documents, letters and other
instruments in connection therewith as they may, with the
advice of counsel, deem necessary or advisable to effect the
President's Plan; and
RESOLVED FURTHER, that Ian Diery, Chief Executive
Officer of the Corporation, is appointed as the Agent for
Service of Process for the Corporation to be named in the
Registration Statement, with all other powers incident to
such appointment; and
RESOLVED FURTHER, that the directors hereby
appoint Messrs. Ian Diery and Dennis R. Leibel, or either of
the them, as the true and lawful attorneys and agents for
the Corporation, each with the power of substitution, to do
any and all acts and things in the Corporation's name and
behalf, and to execute any and all instruments for the
Corporation in its name, which said attorneys and agents, or
either of them, may deem necessary or advisable to enable
this Corporation to comply with the 1933 Act, and any rules,
regulations and requirements of the SEC in connection with
the Registration Statement, including specifically, but
without limitation, power and authority to sign for this
Corporation in its name, any and all amendments (including
post-effective amendments) thereto; and the Corporation does
hereby ratify and confirm all that said attorneys and
agents, or their substitute or substitutes, or any one of
them, shall do or cause to be done by virtue hereof; and
RESOLVED FURTHER, that this Board of Directors
hereby deems the grant and issuance of stock options and
shares of Common Stock under the President's Plan to be
exempt from qualification under the California Corporations
Code pursuant to Section 25100(o) thereof; and
RESOLVED FURTHER, that the officers of the
Corporation be, and each thereof hereby is, authorized to
execute and deliver such further documents and instruments
and to do and perform such other acts as may be necessary or
advisable in order to carry out and perform the purposes and
intentions of the foregoing resolutions; and
RESOLVED FURTHER, that the Secretary or any
Assistant Secretary of the Corporation is authorized to
certify and deliver a copy of this resolution, and any one
or more of the foregoing resolutions, to such persons, firms
or corporations as he may deem necessary or advisable.
DATED this 2nd day of November, 1995.
Hoon Choo
Bruce C. Edwards
Richard J. Goeglein
Kwang-Ho Kim
Young Soo Kim
Jack W. Peltason
Safi U. Qureshey
Carmelo J. Santoro
Won Suk Yang
Hee Dong Yoo
NQO-3585
NONQUALIFIED COMMON STOCK OPTION AGREEMENT
THIS NONQUALIFIED COMMON STOCK OPTION AGREEMENT, made this 2nd day of
November, 1995, between AST RESEARCH, INC., a Delaware corporation (the
"Company"), and Ian Diery, President and Chief Executive Officer of the Company
(the "Optionee"), is made with reference to the following facts:
RECITALS:
---------
A. Optionee is President and Chief Executive Officer of the Company and
the grant of the options provided herein was a necessary and material inducement
to Optionee to accept such positions.
B. The Company desires, by affording the Optionee an opportunity to
purchase shares of Common Stock of the Company ("shares"), to provide additional
incentives and motivation to Optionee.
C. Concurrently herewith, Optionee and the Company are entering into a
Severance Compensation Agreement dated November 2, 1995 (the "Severance
Compensation Agreement").
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants hereinafter
set forth, and for good and valuable consideration, the parties do hereby agree
as follows:
1. Grant of Option.
----------------
The Company hereby irrevocably grants to the Optionee the right and
option (the "Option") to purchase all or any part of an aggregate of 300,000
shares (subject to adjustment as provided in Paragraph 8 hereof) on the terms
and conditions herein set forth. The Option is not an "incentive option" within
the meaning of Section 422A of the Internal Revenue Code of 1986, as amended
(the "Code").
2. Purchase Price.
---------------
The purchase price of the shares covered by the Option is $9.375 per
share, which is not less than the Fair Market Value of the shares as of the date
hereof, as determined pursuant to Paragraph 12.
3. Term of Option, Exercisability.
-------------------------------
The Option shall commence on the date hereof and all rights to
purchase shares hereunder shall cease at 11:59 p.m. on the day before the tenth
(10th) anniversary of the date hereof, subject to earlier termination as
provided herein. Except as may otherwise be provided in this Agreement, options
granted hereunder may be cumulative and exercised as follows:
Commencing on: Optionee may purchase:
November 2, 1996 75,000 Shares
November 2, 1997 75,000 Shares
November 2, 1998 75,000 Shares
November 2, 1999 75,000 Shares
In addition, the exerciseability of the Option may be accelerated in
certain circumstances as set forth in Section 4(b) of the Severance Compensation
Agreement.
In the event of the involuntary employment termination of Optionee by
the Company other than for Cause, as defined in Section 3(d) of the Severance
Compensation Agreement, Optionee may purchase such additional number of shares
as would have become purchasable during the two (2) year period commencing on
the date of such termination.
Except as provided in Paragraph 5 hereof, the Option may not be
exercised unless the Optionee shall have been continuously, from the date hereof
to the date of the exercise of the Option, an employee of the Company, its
parent, if any, or of one or more of its subsidiaries or a corporation or a
parent or subsidiary of a corporation issuing or assuming an option to which
Section 425(a) of the Code applies.
4. Nontransferability.
-------------------
The Option shall not be transferable otherwise than by will or the
laws of descent and distribution, and the Option may be exercised, during the
lifetime of the Optionee, only by Optionee. More particularly (but without
limiting the generality of the foregoing), the Option may not be assigned,
transferred (except as provided in Paragraph 6 hereof), pledged or hypothecated
in any way, shall not be assignable by operation of law and shall not be subject
to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the Option contrary to
the provisions hereof, and the levy of any execution, attachment or similar
process upon the Option, shall be null and void and without effect.
5. Termination of Employment.
--------------------------
In the event that the Optionee ceases to be employed by the Company,
or a parent or subsidiary of the Company, or a corporation or a parent or
subsidiary of a corporation issuing or assuming an option to which Section
425(a) of the Code applies, the Option shall terminate; provided, however, that
if such cessation of employment is other than by reason of death, Disability (as
defined in Paragraph 12), termination for Cause (as defined in Section 3(d) of
the Severance Compensation Agreement) or Retirement (as defined in Paragraph
12), the Optionee shall have the right to exercise the Option at any time within
three (3) months after such cessation, but in no event later than the date of
expiration of the option period, but, subject to Paragraph 3 hereof, and any
operative provision of the Severance Compensation Agreement, the number of
shares purchasable upon such exercise shall not exceed the number which would
have been purchasable if the Optionee had exercised the Option on the date of
such cessation. If the Optionee ceases to be so employed as a result of death
or Disability, a twelve (12) month period shall be substituted for the three (3)
month period. If the Optionee ceases to be so employed as a result of
Retirement, a three (3) year period shall be substituted for the three (3) month
period. In addition, under certain circumstances set forth in the Severance
Compensation Agreement, a six (6) month period shall be substituted for the
three (3) month period. If the Optionee ceases to be so employed as a result of
termination for Cause the Option shall terminate immediately.
6. Other Expirations.
------------------
In addition to any other event causing an expiration or termination of
the Option, the Option shall expire and all rights to purchase shares shall
cease (to the extent not theretofore terminated or expired as herein provided)
upon the effective date of the dissolution or liquidation of the Company or upon
a merger, consolidation, acquisition of property or shares, separation or
reorganization of the Company with one or more entities, corporate or otherwise,
as a result of which the Company is not the surviving entity, or of a sale of
substantially all of the property or shares of the Company to another entity,
corporate or otherwise; provided, however, that the Company may, in its
discretion, and immediately prior to any such transaction, cause a new option to
be substituted for the Option or cause the Option to be assumed by an employer
entity or a parent or subsidiary of such entity; and such new option shall apply
to all shares issued in addition to or substitution, replacement or modification
of the shares theretofore covered by the Option; provided that:
(1) the excess of the aggregate fair market value of the shares
subject to the option immediately after the substitution or assumption over
the aggregate option price of such shares shall not be more than the excess
of the aggregate fair market value of all shares subject to the option
immediately before such substitution or assumption over the aggregate
option price of such shares; and
(2) the new option or the assumption of the existing option shall not
give the Optionee additional benefits which Optionee did not have under the
old option or prior to such assumption; and
(3) an appropriate adjustment of the original option price shall be
made among original shares subject to the option and any additional shares
or shares issued in substitution, replacement or modification thereof.
If no provision is made for the continuance and the assumption of the Option, or
the substitution for the Option of new options as hereinabove provided, then the
Company shall cause written notice to be given to the Optionee of the proposed
transaction not less than thirty (30) days prior to the anticipated effective
date thereof, and the Option, if not already exercisable, shall thereupon become
immediately exercisable as to all the shares of Common Stock subject to the
Option and the Optionee shall have the right to exercise the Option at any time
prior to the effective date of the proposed transaction.
7. Change in Control.
------------------
Notwithstanding Section 6 above, in the event of a change in control
of the Company, as defined below, the Option shall immediately become fully
exercisable; provided, however, that if such acceleration of exercisability
would be deemed a "parachute payment" (as defined in Section 280G of the Code),
such exercisability shall be limited to the largest portion as can be exercised
without being a "parachute payment." For purposes of this Agreement, a "change
in control" of the Company shall be deemed to have occurred if (i) there shall
be consummated (x) any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant to which
shares of the Company's Common Stock would be converted into cash, securities or
other property, other than a merger of the Company in which the holders of the
Company's Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger, or (y) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of the Company, or (ii) the stockholders of the Company approve
any plan or proposal for the liquidation or dissolution of the Company, or (iii)
any person (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")), shall become
the beneficial owner (within the meaning of Rule 13d-3 under the Exchange Act)
of 50% or more of the Company's outstanding Common Stock, or (iv) during any
period of two consecutive years, individuals who at the beginning of such period
constitute the entire Board of Directors shall cease for any reason to
constitute a majority thereof unless the election, or the nomination for
election by the Company's stockholders, of each new director was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period.
8. Adjustments.
------------
The number and class of shares subject to the Option, and the purchase
price per share (but not the total purchase price), and the minimum number of
shares as to which the Option may be exercised at any one time, shall all be
proportionately adjusted in the event of any change or increase or decrease in
the number of issued shares of Common Stock in the Company, without receipt of
consideration by the Company, which result from a split-up or consolidation of
shares, payment of a share dividend (in excess of two percent (2%)), a
recapitalization, combination of shares or other like capital adjustment, so
that, upon exercise of the Option, the Optionee shall receive the number and
class of shares Optionee would have received had Optionee been the holder of the
number of shares of Common Stock in the Company, for which the Option is being
exercised, on the date of such change or increase or decrease in the number of
issued shares of Common Stock in the Company. Subject to any required action by
its stockholders, and subject to the provisions of Section 7 hereof, if the
Company shall be a surviving entity in any reorganization, merger or
consolidation, the Option shall be proportionately adjusted so as to apply to
the securities to which the holder of the number of shares of Common Stock in
the Company subject to the Option would have been entitled. Adjustments under
this paragraph shall be made by the Board of Directors or a Committee thereof
whose determination with respect thereto shall be final and conclusive. No
fractional shares shall be issued under the Option or upon any such adjustment.
9. Payment and Method of Exercising Option.
----------------------------------------
Subject to the terms and conditions of this Option Agreement, the
Option may be exercised by written notice to the Company, at its principal
office in the State of California, which presently is located at 16215 Alton
Parkway, Irvine, California 92718. Such notice shall state the election to
exercise the Option and the number of shares in respect of which it is being
exercised and shall be signed by the person or persons so exercising the Option.
The purchase price of the shares as to which the Option is exercised shall be
paid in full at the time of exercise (i) in cash, (ii) subject to any legal
restrictions on the acquisition or purchase of such shares by the Company and
with the prior written consent and approval of the Company, by the delivery of
shares of Common Stock of the Company which shall be deemed to have a value to
the Company equal to the aggregate Fair Market Value of such shares, or with
such consent and approval, any combination of (i) or (ii) above. Any shares of
Common Stock of the Company delivered to the Company in payment of the purchase
price must have been held by the Optionee for at least six months. In addition,
with the prior written consent and approval of the Company, the purchase price
of the shares may be made by delivery of a properly executed notice together
with irrevocable instructions to a broker to sell the shares issued on exercise
of the Option and to promptly deliver to the Company the amount of the sale
proceeds to pay the purchase price. The notice of exercise shall be accompanied
by payment in the form specified above, in an amount equal to, in the aggregate,
the full purchase price of such shares, and the Company shall deliver a
certificate or certificates representing the shares subject to such exercise as
soon as practicable after the notice shall be received. The certificate or
certificates for the shares as to which the Option shall have been so exercised
shall be registered in the name of the person or persons so exercising the
Option and shall be delivered as provided above to or upon the written order of
the person or persons exercising the Option. In the event the Option shall be
exercised by any person or persons other than the Optionee in accordance with
the terms hereof, such notice shall be accompanied by appropriate proof of the
right of such person or persons to exercise the Option. All shares purchased
upon the exercise of the Option shall be fully paid and nonassessable. The
holder of this Option shall not be entitled to the privileges of share ownership
as to any shares of Common Stock not actually issued and delivered to Optionee.
10. Tax Withholding.
----------------
The Company shall have the power to withhold, or require Optionee to
remit to the Company, an amount sufficient to satisfy Federal, state, and local
withholding tax requirements with respect to the exercise of the Option. To the
extent permissible under applicable tax, securities, and other laws, the Company
may, in its sole discretion, permit Optionee to satisfy an obligation to pay any
tax to any governmental entity in respect of such exercise, up to an amount
determined on the basis of the highest marginal tax rate applicable to Optionee,
in whole or in part, by (i) directing the Company to apply shares of Common
Stock to which the Optionee is entitled as a result of the exercise of the
Option, or (ii) delivering to the Company shares of Common Stock owned by the
Optionee. Such shares shall be valued for such tax purposes at the Fair Market
Value on the date of exercise.
11. No Agreement to Employ.
-----------------------
Nothing in this Agreement shall be construed to constitute or be
evidence of any agreement or understanding, express or implied, on the part of
the Company to employ or retain Optionee for any specific period of time.
12. Definitions.
------------
Whenever used herein, the following terms shall have the respective
meanings set forth below:
(a) "Disability" means, as defined by Section 22(e)(3) of
the Code, an Optionee's permanent and total disability if he is
unable to engage in any substantial gainful activity by reason of
any medically determined 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. If necessary to maintain beneficial tax treatment, such
definition may be modified to conform to any amendment of
"Disability" under the Code.
(b) "Employee" means a regular employee (including
directors who are also employees) of the Company, its parent or
its subsidiaries, or any branch or division thereof.
(c) "Fair Market Value" means the closing price as reported
by the principal stock exchange on which the Common Stock is then
listed or, if not so listed, as reported on the NASDAQ National
Market, on a particular date (or, if no closing sale price is
reported, the average of the bid and ask prices on such date).
In the event that there are no closing sale (or bid and ask)
prices reported on such date, the Fair Market Value shall be
determined as of the immediately preceding date on which there
were Common Stock transactions, however, if there is not an
active public trading market for the Common Stock, the Fair
Market Value shall be determined in good faith by the Board of
Directors.
(d) "Retirement" means termination of employment for
reasons other than death after an Optionee attains age 65, or has
attained age 55 with five years of service to the Company.
13. General.
--------
The Company shall at all times during the term of the Option reserve
and keep available such number of shares of Common Stock as will be sufficient
to satisfy the requirements of this Option Agreement, shall pay all original
issue and transfer taxes with respect to the issue and transfer of shares
pursuant hereto and all other fees and expenses necessarily incurred by the
Company in connection therewith, and will from time to time use its best efforts
to comply with all laws and regulations, which, in the opinion of counsel for
the Company, shall be applicable thereto.
14. Coordination with Severance Compensation Agreement.
---------------------------------------------------
In the event of any conflict between the terms hereof and the terms of
the Severance Compensation Agreement, the terms of the agreement which provides
greater benefit to Optionee will control.
15. Requirements of Law and Governing Law.
--------------------------------------
The issuance of shares of Stock upon the exercise of the Option shall
be subject to all applicable laws, rules and regulations, and to such approvals
by the governmental agency or national securities exchange as may be required
This Option shall be construed in accordance with, and governed by,
the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Option Agreement to be
duly executed by its officers thereunto duly authorized, and the Optionee has
hereunto set his or her hand, all as of the day and year first above written.
AST RESEARCH, INC.
By: Dennis Liebel
"Company"
Ian Diery
"Optionee"
NQO-3586
NONQUALIFIED COMMON STOCK OPTION AGREEMENT
THIS NONQUALIFIED COMMON STOCK OPTION AGREEMENT, made this 2nd day of
November, 1995, between AST RESEARCH, INC., a Delaware corporation (the
"Company"), and Ian Diery, President and Chief Executive Officer of the Company
(the "Optionee"), is made with reference to the following facts:
RECITALS:
---------
A. Optionee is President and Chief Executive Officer of the Company and
the grant of the options provided herein was a necessary and material inducement
to Optionee to accept such positions.
B. The Company desires, by affording the Optionee an opportunity to
purchase shares of Common Stock of the Company ("shares"), to provide additional
incentives and motivation to Optionee.
C. Concurrently herewith, Optionee and the Company are entering into a
Severance Compensation Agreement dated November 2, 1995 (the "Severance
Compensation Agreement").
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants hereinafter
set forth, and for good and valuable consideration, the parties do hereby agree
as follows:
1. Grant of Option.
----------------
The Company hereby irrevocably grants to the Optionee the right and
option (the "Option") to purchase all or any part of an aggregate of 700,000
shares (subject to adjustment as provided in Paragraph 8 hereof) on the terms
and conditions herein set forth. The Option is not an "incentive option" within
the meaning of Section 422A of the Internal Revenue Code of 1986, as amended
(the "Code").
2. Purchase Price.
---------------
The purchase price of the shares covered by the Option is $9.375 per
share, which is not less than the Fair Market Value of the shares as of the date
hereof, as determined pursuant to Paragraph 12.
3. Term of Option, Exercisability.
-------------------------------
The Option shall commence on the date hereof and all rights to
purchase shares hereunder shall cease at 11:59 p.m. on the day before the tenth
(10th) anniversary of the date hereof, subject to earlier termination as
provided herein. Except as may otherwise be provided in this Agreement, options
granted hereunder may be cumulative and exercised as follows:
Commencing On: Optionee May Purchase:
November 2, 1996 87,500
November 2, 1997 87,500
November 2, 1998 87,500
November 2, 1999 87,500
November 2, 2000 87,500
November 2, 2001 87,500
November 2, 2002 87,500
November 2, 2003 87,500
Notwithstanding the foregoing:
(a) In the event (i) the Fair Market Value of the Common
Stock equals or exceeds $21.00 per share and (ii) for the period
of three (3) months thereafter, the average Fair Market Value of
the Common Stock exceeds $21.00 per share, Optionee may exercise,
at any time commencing at the end of such three (3) month period,
this Option to purchase up to 233,333 shares of Common Stock,
inclusive of any shares which are purchasable due to the passage
of time as set forth above.
(b) In the event (i) the Fair Market Value of the Common
Stock equals or exceeds $30.00 per share and (ii) for the period
of three (3) months thereafter, the average Fair Market Value of
the Common Stock exceeds $30.00 per share, Optionee may exercise,
at any time commencing at the end of such three (3) month period,
this Option to purchase up to 466,667 shares of Common Stock,
inclusive of any shares which are purchasable due to the passage
of time as set forth above and the 233,333 shares set forth in
subparagraph 3(a) above.
(c) In the event (i) the Fair Market Value of the Common
Stock equals or exceeds $40.00 per share and (ii) for the period
of three (3) months thereafter, the average Fair Market Value of
the Common Stock exceeds $40.00 per share, Optionee may exercise,
at any time commencing at the end of such three (3) month period,
this Option to purchase up to 700,000 shares of Common Stock.
For purposes hereof, the $21.00, $30.00 and $40.00 per share prices
are referred to as the "Trigger Prices" and shall be subject to adjustment as
set forth in Paragraph 8 hereof.
Notwithstanding Section 4(b) of the Severance Compensation Agreement,
the exercisability of the Option shall not be accelerated pursuant to the
Severance Compensation Agreement.
Except as provided in Paragraph 5 hereof, the Option may not be
exercised unless the Optionee shall have been continuously, from the date hereof
to the date of the exercise of the Option, an employee of the Company, its
parent, if any, or of one or more of its subsidiaries or a corporation or a
parent or subsidiary of a corporation issuing or assuming an option to which
Section 425(a) of the Code applies.
4. Nontransferability.
-------------------
The Option shall not be transferable otherwise than by will or the
laws of descent and distribution, and the Option may be exercised, during the
lifetime of the Optionee, only by Optionee. More particularly (but without
limiting the generality of the foregoing), the Option may not be assigned,
transferred (except as provided in Paragraph 6 hereof), pledged or hypothecated
in any way, shall not be assignable by operation of law and shall not be subject
to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the Option contrary to
the provisions hereof, and the levy of any execution, attachment or similar
process upon the Option, shall be null and void and without effect.
5. Termination of Employment.
--------------------------
In the event that the Optionee ceases to be employed by the Company,
or a parent or subsidiary of the Company, or a corporation or a parent or
subsidiary of a corporation issuing or assuming an option to which Section
425(a) of the Code applies, the Option shall terminate; provided, however, that
if such cessation of employment is other than by reason of death, Disability (as
defined in Paragraph 12), termination for Cause (as defined in Section 3(d) of
the Severance Compensation Agreement) or Retirement (as defined in Paragraph
12), the Optionee shall have the right to exercise the Option at any time within
three (3) months after such cessation, but in no event later than the date of
expiration of the option period, but the number of shares purchasable upon such
exercise shall not exceed the number which would have been purchasable if the
Optionee had exercised the Option on the date of such cessation. If the
Optionee ceases to be so employed as a result of death or Disability, a twelve
(12) month period shall be substituted for the three (3) month period. If the
Optionee ceases to be so employed as a result of Retirement, a three (3) year
period shall be substituted for the three (3) month period. In addition, under
certain circumstances set forth in the Severance Compensation Agreement, a six
(6) month period shall be substituted for the three (3) month period. If the
Optionee ceases to be so employed as a result of termination for Cause the
Option shall terminate immediately.
6. Other Expirations.
------------------
In addition to any other event causing an expiration or termination of
the Option, the Option shall expire and all rights to purchase shares shall
cease (to the extent not theretofore terminated or expired as herein provided)
upon the effective date of the dissolution or liquidation of the Company or upon
a merger, consolidation, acquisition of property or shares, separation or
reorganization of the Company with one or more entities, corporate or otherwise,
as a result of which the Company is not the surviving entity, or of a sale of
substantially all of the property or shares of the Company to another entity,
corporate or otherwise; provided, however, that the Company may, in its
discretion, and immediately prior to any such transaction, cause a new option to
be substituted for the Option or cause the Option to be assumed by an employer
entity or a parent or subsidiary of such entity; and such new option shall apply
to all shares issued in addition to or substitution, replacement or modification
of the shares theretofore covered by the Option; provided that:
(1) the excess of the aggregate fair market value of the shares
subject to the option immediately after the substitution or assumption over
the aggregate option price of such shares shall not be more than the excess
of the aggregate fair market value of all shares subject to the option
immediately before such substitution or assumption over the aggregate
option price of such shares; and
(2) the new option or the assumption of the existing option shall not
give the Optionee additional benefits which Optionee did not have under the
old option or prior to such assumption; and
(3) an appropriate adjustment of the original option price shall be
made among original shares subject to the option and any additional shares
or shares issued in substitution, replacement or modification thereof.
If no provision is made for the continuance and the assumption of the Option, or
the substitution for the Option of new options as hereinabove provided, then the
Company shall cause written notice to be given to the Optionee of the proposed
transaction not less than thirty (30) days prior to the anticipated effective
date thereof, and the Optionee shall have the right to exercise the Option, to
the extent then exercisable, at any time prior to the effective date of the
proposed transaction.
7. Intentionally Omitted.
----------------------
8. Adjustments.
------------
The number and class of shares subject to the Option, and the purchase
price per share (but not the total purchase price), and the minimum number of
shares as to which the Option may be exercised at any one time, shall all be
proportionately adjusted in the event of any change or increase or decrease in
the number of issued shares of Common Stock in the Company, without receipt of
consideration by the Company, which result from a split-up or consolidation of
shares, payment of a share dividend (in excess of two percent (2%)), a
recapitalization, combination of shares or other like capital adjustment, so
that, upon exercise of the Option, the Optionee shall receive the number and
class of shares Optionee would have received had Optionee been the holder of the
number of shares of Common Stock in the Company, for which the Option is being
exercised, on the date of such change or increase or decrease in the number of
issued shares of Common Stock in the Company. Subject to any required action by
its stockholders if the Company shall be a surviving entity in any
reorganization, merger or consolidation, the Option shall be proportionately
adjusted so as to apply to the securities to which the holder of the number of
shares of Common Stock in the Company subject to the Option would have been
entitled.
Trigger Prices shall also be proportionately adjusted in the event of
any change or increase or decrease in the number of issued shares of Common
Stock in the Company, without receipt or consideration by the Company, which
results from a split-up or consolidation of shares, payment of a share dividend
(in excess of two percent (2%)), recapitalization, combination of shares for
other like capital adjustment, in accordance with the following formula:
Adjusted Trigger Price =
Then Existing Trigger Price x Number of Issued Shares Prior to Event
--------------------------------------------------------------------
Number of Issued Shares After Event
Adjustments under this paragraph shall be made by the Board of Directors or a
committee thereof whose determination with respect thereto shall be final and
conclusive. No fractional shares shall be issued under the Option or upon any
such adjustment.
9. Payment and Method of Exercising Option.
----------------------------------------
Subject to the terms and conditions of this Option Agreement, the
Option may be exercised by written notice to the Company, at its principal
office in the State of California, which presently is located at 16215 Alton
Parkway, Irvine, California 92718. Such notice shall state the election to
exercise the Option and the number of shares in respect of which it is being
exercised and shall be signed by the person or persons so exercising the Option.
The purchase price of the shares as to which the Option is exercised shall be
paid in full at the time of exercise (i) in cash, (ii) subject to any legal
restrictions on the acquisition or purchase of such shares by the Company and
with the prior written consent and approval of the Company, by the delivery of
shares of Common Stock of the Company which shall be deemed to have a value to
the Company equal to the aggregate Fair Market Value of such shares, or with
such consent and approval, any combination of (i) or (ii) above. Any shares of
Common Stock of the Company delivered to the Company in payment of the purchase
price must have been held by Optionee for at least six months. In addition,
with the prior written consent and approval of the Company, the purchase price
of the shares may be made by delivery of a properly executed notice together
with irrevocable instructions to a broker to sell the shares issued on exercise
of the Option and to promptly deliver to the Company the amount of the sale
proceeds to pay the purchase price. The notice of exercise shall be accompanied
by payment in the form specified above, in an amount equal to, in the aggregate,
the full purchase price of such shares, and the Company shall deliver a
certificate or certificates representing the shares subject to such exercise as
soon as practicable after the notice shall be received. The certificate or
certificates for the shares as to which the Option shall have been so exercised
shall be registered in the name of the person or persons so exercising the
Option and shall be delivered as provided above to or upon the written order of
the person or persons exercising the Option. In the event the Option shall be
exercised by any person or persons other than the Optionee in accordance with
the terms hereof, such notice shall be accompanied by appropriate proof of the
right of such person or persons to exercise the Option. All shares purchased
upon the exercise of the Option shall be fully paid and nonassessable. The
holder of this Option shall not be entitled to the privileges of share ownership
as to any shares of Common Stock not actually issued and delivered to Optionee.
10. Tax Withholding.
----------------
The Company shall have the power to withhold, or require Optionee to
remit to the Company, an amount sufficient to satisfy Federal, state, and local
withholding tax requirements with respect to the exercise of the Option. To the
extent permissible under applicable tax, securities, and other laws, the Company
may, in its sole discretion, permit Optionee to satisfy an obligation to pay any
tax to any governmental entity in respect of such exercise, up to an amount
determined on the basis of the highest marginal tax rate applicable to Optionee,
in whole or in part, by (i) directing the Company to apply shares of Common
Stock to which the Optionee is entitled as a result of the exercise of the
Option, or (ii) delivering to the Company shares of Common Stock owned by the
Optionee. Such shares shall be valued for such tax purposes at the Fair Market
Value on the date of exercise.
11. No Agreement to Employ.
-----------------------
Nothing in this Agreement shall be construed to constitute or be
evidence of any agreement or understanding, express or implied, on the part of
the Company to employ or retain Optionee for any specific period of time.
12. Definitions.
------------
Whenever used herein, the following terms shall have the respective
meanings set forth below:
(a) "Disability" means, as defined by Section 22(e)(3) of
the Code, an Optionee's permanent and total disability if he is
unable to engage in any substantial gainful activity by reason of
any medically determined 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. If necessary to maintain beneficial tax treatment, such
definition may be modified to conform to any amendment of
"Disability" under the Code.
(b) "Employee" means a regular employee (including
directors who are also employees) of the Company, its parent or
its subsidiaries, or any branch or division thereof.
(c) "Fair Market Value" means the closing price as reported
by the principal stock exchange on which the Common Stock is then
listed or, if not so listed, as reported on the NASDAQ National
Market, on a particular date (or, if no closing sale price is
reported, the average of the bid and ask prices on such date).
In the event that there are no closing sale (or bid and ask)
prices reported on such date, the Fair Market Value shall be
determined as of the immediately preceding date on which there
were Common Stock transactions, however, if there is not an
active public trading market for the Common Stock, the Fair
Market Value shall be determined in good faith by the Board of
Directors.
(d) "Retirement" means termination of employment for
reasons other than death after an Optionee attains age 65, or has
attained age 55 with five years of service to the Company.
13. General.
--------
The Company shall at all times during the term of the Option reserve
and keep available such number of shares of Common Stock as will be sufficient
to satisfy the requirements of this Option Agreement, shall pay all original
issue and transfer taxes with respect to the issue and transfer of shares
pursuant hereto and all other fees and expenses necessarily incurred by the
Company in connection therewith, and will from time to time use its best efforts
to comply with all laws and regulations, which, in the opinion of counsel for
the Company, shall be applicable thereto.
14. Coordination with Severance Compensation Agreement.
---------------------------------------------------
Unless specifically addressed herein, in the event of any conflict
between the terms hereof and the terms of the Severance Compensation Agreement,
the terms of the agreement which provides greater benefit to Optionee will
control.
15. Requirements of Law and Governing Law.
--------------------------------------
The issuance of shares of Stock upon the exercise of the Option shall
be subject to all applicable laws, rules and regulations, and to such approvals
by the governmental agency or national securities exchange as may be required
This Option shall be construed in accordance with, and governed by,
the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Option Agreement to be
duly executed by its officers thereunto duly authorized, and the Optionee has
hereunto set his or her hand, all as of the day and year first above written.
AST RESEARCH, INC.
By: Dennis Liebel
"Company"
Ian Diery
"Optionee"
January 25, 1996
AST Research, Inc.
16215 Alton Parkway
Irvine, California 92718
RE: Registration Statement on Form S-8 - President's Plan
Gentlemen:
At your request, we have examined the form of Registration Statement on
Form S-8 (the "Registration Statement") being filed by AST Research, Inc., a
Delaware corporation (the "Company"), with the Securities and Exchange
Commission in connection with the registration under the Securities Act of 1933,
as amended, of 1,000,000 shares of the Company's Common Stock, $.01 par value
("Common Stock"), issuable under the Company's President's Plan (the "Plan").
We have examined the proceedings heretofore taken and are familiar with the
additional proceedings proposed to be taken by the Company in connection with
the authorization, issuance and sale of the securities referred to above. Based
on the foregoing, it is our opinion that:
1. Stock options, when issued in accordance with the Plan, will be
legally issued and binding obligations of the Company; and
2. An aggregate of 1,000,000 shares of Common Stock, when issued under
the Plan and against full payment in accordance with the terms and conditions of
the Plan, will be legally and validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
STRADLING, YOCCA, CARLSON & RAUTH
A Professional Corporation
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the President's Plan of AST Research, Inc. of our
report dated July 26, 1995, except for Notes 5, 6, 8, 11 and 14, as to which the
date is August 31, 1995, with respect to the consolidated financial statements
and schedules of AST Research, Inc. included in its Annual Report (Form 10-K)
for the year ended July 1, 1995, filed with the Securities and Exchange
Commission.
Ernst & Young LLP
Orange County, California
January 23, 1996
