As filed with the Securities and Exchange Commission on April 20, 2000
Registration No. ___________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
PMC-SIERRA, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-2925073
(State of Incorporation) (I.R.S. Employer Identification No.)
105-8555 Baxter Place
Burnaby, British Columbia V5A 4V7
Canada
(Address of principal executive offices)
AANetcom, Inc. Stock Option Plan
(Full title of the plan)
The Corporation Trust Company
1209 Orange Street
Wilmington, Delaware 19801
(800) 677-3394
(Name, address and telephone number of agent for service)
Copy to:
Neil Wolff
Wilson Sonsini Goodrich & Rosati, P.C.
650 Page Mill Road
Palo Alto, California 94304-1050
CALCULATION OF REGISTRATION FEE
================================================================================
Proposed Proposed
Title of Maximum Maximum Amount
Securities Amount Offering Aggregate of
to be to be Price Per Offering Registration
Registered (1) Registered Share Price Fee
- ------------------- ------------- -------------- ---------------- --------------
Common Stock,
$0.001 par value 5,877 (2) $1.49 (2) $8,756.73 (2) $2.31
- ------------------- ------------- -------------- ---------------- --------------
Common Stock,
$0.001 par value 276,386 (3) $126.50 (3) $34,962,829 (3) $9,230.19
=================== ============= ============== ================ ==============
(1) Pursuant to the Acquisition Agreement dated as of February 25, 2000
among PMC-Sierra, Inc. ("PMC"), Porsche Acquisition Corporation,
AANetcom, Inc., Kal Shastri, and Citicorp Trust, N.A., PMC assumed,
effective as of March 3, 2000, all of the outstanding options to
purchase common stock of AANetcom under the AANetcom Stock Option Plan,
and such options became exercisable to purchase shares of PMC's common
stock, with appropriate adjustments to the number of shares and exercise
price of each assumed option.
(2) Options granted pursuant to an employee stock option plan. Estimated
pursuant to Rule 457(h)(1) under the Securities Act of 1933, as amended,
solely for the purpose of calculating the registration fee. Based on the
price per share at which the options may be exercised.
(3) Shares reserved for future issuance. Estimated pursuant to Rule 457(c)
under the Securities Act of 1933, as amended, solely for the purpose of
calculating the registration fee. Based on the average of the high and
low prices of the common stock on April 14, 2000, as reported on the
Nasdaq National Market.
================================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
---------------------------------------
The following documents and information are incorporated by reference
as filed with the Securities and Exchange Commission:
(a) PMC-Sierra, Inc.'s ("PMC's") Form 10-K Annual Report for the
fiscal year ended December 26, 1999, as amended (File No. 000-19084).
(b) PMC's Form 8-K dated March 20, 2000 and April 12, 2000 (File No.
000-19084).
(c) PMC's Registration Statements on Form S-8, dated October 3, 1996
(File No. 333-13357), August 29, 1997 (File No. 333-34671), June 4, 1998 (File
No. 333-55983), January 19, 2000 (File No. 333-94999) and April 12, 2000 (File
No. 333-34622).
All documents subsequently filed by PMC pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended, prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this registration
statement and to be part hereof from the date of filing such documents.
Item 4. Description of Securities.
-------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
Certain legal matters with respect to the shares will be passed upon
by Wilson, Sonsini, Goodrich & Rosati, a Professional Corporation, Palo Alto,
California.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Section 145 of the Delaware General Corporation Law generally
provides that a corporation is empowered to indemnify any person who is made a
party to any threatened, pending or completed action, suit or proceeding by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation or is or was serving, at the request of the corporation, in any
of such capacities of another corporation or other enterprise, if such director,
officer, employee or agent acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. This statute describes in detail the right of
PMC to indemnify any such person.
PMC's Certificate of Incorporation eliminates in certain circumstances
the liability of directors of PMC for monetary damages for breach of their
fiduciary duty as directors. This provision does not eliminate the liability of
a director (i) for breach of the director's duty of loyalty to PMC or its
stockholders, (ii) for acts or omissions by the director not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) for
willful or negligent declaration of an unlawful dividend, stock purchase or
redemption or (iv) for transactions from which the director derived an improper
personal benefit.
<PAGE>
PMC's Certificate of Incorporation also provides generally for
indemnification of all directors and officers of PMC to the fullest extent
permitted by the General Corporation Law of the State of Delaware. Such right to
indemnification shall be deemed to be a contract right and includes generally
the right to be paid by PMC the expenses incurred in defending any proceeding
covered by this provision in advance of its final disposition. Individuals who
are entitled to indemnification may bring suit to seek recovery of amounts due
under the foregoing provisions and to recover the expenses of such suit if
successful.
PMC has entered into indemnification agreements to such effect with its
officers and directors containing provisions which are in some respects broader
than the specific indemnification provisions contained in the General
Corporation Law of Delaware. The indemnification agreements may require PMC,
among other things, to indemnify such officers and directors against certain
liabilities that may arise by reason of their status or service as directors or
officers (other than liabilities arising from willful misconduct of a culpable
nature) and to advance their expenses incurred as a result of any proceeding
against them as to which they could be indemnified.
PMC believes that it is the position of the Commission that insofar as
the foregoing provisions may be invoked to disclaim liability for damages
arising under the Securities Act, such provisions are against public policy as
expressed in the Securities Act and are therefore unenforceable.
PMC currently maintains an officers' and directors' liability insurance
policy which covers, subject to the exclusions and limitations of the policy,
officers and directors of PMC against certain liabilities which may be incurred
by them solely in such capacities.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not applicable.
Item 8. Exhibits.
--------
Exhibit
Number
4.1 AANetcom, Inc. Stock Option Plan
4.2 Form of Option Grant Agreement under AANetcom, Inc. Stock
Option Plan
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation
23.1 Consent of Deloitte & Touche LLP, Independent Auditors
23.2 Consent of Counsel (Contained in Exhibit 5.1 above)
24.1 Power of Attorney (see page II-4)
Item 9. Undertakings.
------------
(a) PMC hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
registration statement 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.
<PAGE>
(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
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
(b) PMC hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of PMC's annual report pursuant
to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of PMC pursuant to the Delaware General Corporation Law, the Certificate of
Incorporation or the Bylaws of PMC, Indemnification Agreements entered into
between PMC and its officers and directors, or otherwise, PMC has been advised
that in the opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by PMC 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 hereunder, PMC 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.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, PMC 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
Burnaby, British Columbia, Canada, on this 18th day of April 2000.
PMC-SIERRA, INC.
By: /s/ROBERT L. BAILEY
--------------------
Robert L. Bailey, President, Chief
Executive Officer and Chairman of
the Board of Directors
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each such person whose
signature appears below constitutes and appoints, jointly and severally, Robert
L. Bailey and John W. Sullivan his attorneys-in-fact, each with the power of
substitution, for him in any and all capacities, to sign any amendments to this
Registration Statement on Form S-8 (including post-effective amendments), and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Commission, hereby ratifying and confirming all that each of
said attorneys-in-fact, or his substitute or substitutes, may do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
Signature Title Date
/s/ROBERT L. BAILEY President, Chief Executive Officer and April 18, 2000
- ---------------------- Chairman of the Board of Directors
(Robert L. Bailey) (principal executive officer)
/s/JOHN W. SULLIVAN Vice President of Finance and April 18, 2000
- ---------------------- Chief Financial Officer (principal
(John W. Sullivan) financial and accounting officer)
/s/JAMES V. DILLER Vice Chairman of the Board April 18, 2000
- ---------------------- of Directors
(James V. Diller)
Director
- ----------------------
(Alexandre Balkanski)
/s/FRANK J. MARSHALL Director April 17, 2000
- ----------------------
(Frank J. Marshall)
/s/L. COLIN BEAUMONT Director April 19, 2000
- ----------------------
(L. Colin Beaumont)
AANETCOM, INC. STOCK OPTION PLAN
Amended and Restated, Effective June 15, 1998
1. Purpose. The purposes of the Aanetcom, Inc. Stock Option Plan, amended and
restated effective June 15, 1998 (the "Plan") are to: (1) closely associate the
interests of the management and key employees of Aanetcom, Inc. (the
"Corporation") with the shareholders by reinforcing the relationship between
participant's rewards and shareholder gains; (2) provide management and key
employees with an equity ownership in the Corporation commensurate with
performance as reflected in increased shareholder value; (3) maintain
competitive compensation levels; and (4) provide an incentive for continuous
employment with the Corporation.
2. Authority to Grant Options. The Stock Option Committee (hereinafter defined)
may from time to time in its discretion grant to eligible employees options to
purchase shares of the Common Stock of the Corporation on the terms and subject
to the conditions hereinafter provided. The aggregate number of shares which may
hereafter be issued pursuant to the exercise of options granted hereunder shall
not exceed the 3,500,000 shares subject however to the provisions of paragraphs
7 and 8 hereof. The shares shall be made available from authorized and unissued
Common Stock or from Common Stock issued and held in the treasury of the
Corporation, as shall be determined by the Board of Directors.
3. Administration. The Plan shall be administered by the Stock Option Committee
(the "Committee") consisting of not less than two (2) members of the Board of
Directors who are not eligible to participate in the Plan. The Committee shall
have the full power and authority to construe, interpret and administer this
Plan and to make determinations which shall be final, conclusive and binding
upon all persons, including without limitation the Corporation, the stockholders
the directors and any persons having any interests in any options which may be
granted under this Plan. Among other matters, the Committee shall have the
authority, subject to the terms of the Plan: (i) to select those persons to whom
awards may be granted from time to time; (ii) to determine whether and to what
extent incentive stock options and nonqualified stock options or any combination
thereof are to be granted hereunder; (iii) to determine the number of shares of
Common Stock to be covered by each award granted hereunder; (v) to determine the
terms and conditions of any award granted hereunder (including, but not limited
to, the option price, the option period, any exercise restriction or limitation
and any exercise acceleration or forfeiture waiver regarding any award and the
shares of Common Stock relating thereto); (vi) to adjust the terms and
conditions, at any time or from time to time, of any Award, subject to the
limitations of Section 10; (vii) to determine to what extent and under what
circumstances Common Stock and other amounts payable with respect to an award
shall be deferred; (viii) to determine under what circumstances an award may be
paid for in cash or Common Stock; (ix) to provide for the forms of agreement to
be utilized in connection with this Plan; (x) to determine whether a participant
has a disability; (xi) to determine what securities law requirements are
applicable to the Plan, awards, and the issuance of shares of Common Stock and
to require of an option holder that appropriate action be taken with respect to
such requirements; (xii) to cancel, with the consent of the option holder or as
otherwise provided in the Plan or an Agreement, outstanding awards; (xiii) to
require as a condition of the exercise of an award or the issuance or transfer
of a certificate of Common Stock, the withholding from an option holder of the
amount of any federal, state or local taxes as may be necessary to order for the
Corporation or any there employer to obtain a deduction or as may be otherwise
required by law; (xiv) to determine whether and with what effect an individual
has incurred a termination of employment; (xv) to determine whether the
Corporation or any other person has a right or obligation to purchase Common
Stock from an option holder and, if so, the terms and conditions on which such
Common Stock is to be purchased; (xvi) to determine the restrictions or
limitations on the transfer of Common Stock; (xvii) to determine whether an
award is to be adjusted, modified or purchased, or is to become fully
exercisable, under the Plan or the terms of an agreement; (xviii) to adopt,
amend and rescind such rules and regulations as, in its opinion, may be
advisable in the administration of this Plan; and (xix) to appoint and
compensate agents, counsel, auditors or other specialists to aid it in the
discharge of its duties.
<PAGE>
The Committee shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, to interpret the terms and provisions of the
Plan and any award issued under the Plan (and any agreement) and to otherwise
supervise the administration of the Plan.Any determination made by the Committee
pursuant to the provisions of the Plan shall be made in its sole discretions,
and in the case of any determination relating to an award, may be made at the
time of the grant of the award or, unless in contravention of any express term
of the Plan or an agreement, at any time thereafter. All decisions made by the
Committee pursuant to the provisions of the Plan shall be final and binding on
all persons, including the Corporation and option holders.
4. Eligibility. Management and other key employees of the Corporation and its
subsidiaries (as defined in Section 424(f) of the Internal Revenue Code of 1986,
as amended), including officers, whether or not directors of the Corporation,
shall be eligible to participate in this Plan and will be referred to herein as
"eligible employees." Directors who are not employees shall not be eligible to
participate in any incentive stock option, however, such directors may be
granted options which are nonqualified options.
5. Allotment of Shares. Options may be allotted to such eligible employees and
directors, and in such amounts, as the Committee
in its discretion, may from time to time determine.
6. Terms and Conditions of Options. Subject to the following provisions, all
options granted under this Plan shall be in such form and upon such terms and
conditions as the Committee, in its discretion, may from time to time determine:
(a) Option Price. The option price per share of the Common Stock
purchasable under an option shall be determined by the Committee. If such option
is intended to qualify as an incentive stock option, the option price per share
shall be not less than the fair market value per share on the date the option is
granted, or where granted to an individual who owns or who is deemed to own
stock possessing more than ten percent (10%) of the combined voting power of all
classes of stock of the Corporation, a corporation which is a parent corporation
of the Corporation or any subsidiary of the Corporation (each as defined in
Section 424 of the Code), not less than one hundred ten percent (110%) of such
fair market value per share. The option price per share of any nonqualified
stock options shall be determined by the Committee but shall not be less than
one hundred (100%) of the fair market value per share on the date such option is
granted.
(b) Option Period. The option period of each stock option shall be
fixed by the Committee; provided that no nonqualified stock option shall be
exercisable more than ten (10) years after the date the option is granted. In
the case of an incentive stock option, the option period shall not exceed ten
(10) years from the date of grant or five (5) years in the case of an individual
who owns more than ten percent (10%) of the combined voting power of all classes
of stock of the Corporation, a corporation which is a parent corporation of the
Company or any subsidiary of the Corporation (each as defined in Section 424 of
the Code). No option which is intended to be an incentive stock option shall be
granted more than ten (10) years from the date the Plan is adopted by the
Corporation or the date the Plan is approved by the stockholders of the
Corporation, whichever is earlier.
Dividends on partly paid shares issued to such option holder (other
than dividends in stock of the Corporation) shall be declared and paid only upon
the basis of the percentage of the total option price actually received thereon
by the Corporation. Certificates for partly paid shares shall be registered in
the name of the option holder and shall, immediately upon issue, be delivered to
the Corporation, endorsed in blank by the option holder or accompanied by a
separate stock power so endorsed, in pledge as security for the payment of the
unpaid balance of the option price. The certificates issued to represent partly
paid shares shall state thereon the total amount of the consideration to be paid
therefor and the amount paid thereon. The holder of an option shall, as such,
have none of the rights of a stockholder.
(c) Offset Provisions. If the Committee so determines and the
applicable instrument or instruments evidencing the option so provide, the
exercise of all or any part of an option granted under this Plan may result in
the reduction or termination of another option granted under this Plan to the
extent so determined and provided.
(d) Payment. Payment for shares purchased upon exercise of an option
shall be made either in full or installments, as shall be determined by the
Committee and provided in the applicable instrument or instruments evidencing
such option.
(e) Exercise of Option The shares covered by option may not be
purchased earlier than one year after the date on which the option is granted.
(f) Nontransferability of Options. During an option holder's lifetime,
an option shall be exercisable only by him or her and shall not be transferable
except for exercise as provided in paragraph (g) hereof.
(g) Termination of Employment. Upon the termination of an option
holder's employment for any reason, his or her option privileges shall be
limited to the shares which were immediately purchasable by him or her at the
date or such termination, and such option privileges shall expire unless
exercised within three months after the date of such termination, but not later
than the date of expiration of the option. Upon the termination of employment as
a result of the death of the option holder, his or her option privileges,
limited to shares which were immediately purchasable at the date of such
termination, may be exercised by the executor or administrator of the estate of
the option holder within three months after the date of such termination, but
not later than the date of expiration of any such option.
(h) Annual Limits. No employee eligible to participate herein shall be
granted incentive options to purchase shares, which said incentive options are
exercisable during any one calendar year, to the extent that the fair market
value of such shares (determined at the time that the options are granted)
exceeds $100,000. No employee shall be given the opportunity to exercise
inventive stock options granted hereunder with respect to shares valued in
excess of $100,000 in any calendar year except to the extent that the options
shall have accumulated over a period in excess of one year.
7. Adjustment in Event of Recapitalization. In the event of a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, or any other change in the corporate structure
or shares of the Corporation, the Committee shall make such equitable
adjustment, if any, as it may deem appropriate, in the number and kind of shares
authorized by this Plan, or in the number, option price and kind of shares
covered by the options granted.
8. Reallocation of Options. Shares covered by options which expire or are
terminated for any reason prior to being exercised in full may, within the
limitations of paragraph 2 above, be reallocated by the Committee.
9. Governmental Regulations. The Plan, and the grant and exercise of options
hereunder, shall be subject to all applicable, rules an regulations of
governmental or other authorities.
10. Discontinuance or Amendment of the Plan. The Board of Directors may
discontinue this Plan at any time, any may amend it from time to time, but no
amendment may, without further stockholder approval, increase the total number
of shares which may be purchased under the Plan other than as provided in
paragraph 7, or extend the period during which options may be granted, or change
the class of employees to whom options may be granted, and no outstanding option
may be revoked, or altered in any manner unfavorable to the holder, without the
consent of the holder.
11. Headings. The headings contained in this Plan are for reference purposes
only and shall not affect the meaning or interpretation of this Plan.
12. Severability. If any provision of this Plan shall for any reason be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
effect any other provision hereby, and this Plan shall be construed as if such
invalid or unenforceable provision were omitted.
13. Successors and Assigns. This Plan shall inure to the benefit of and be
binding upon each successor of the Corporation. All obligations imposed upon a
Participant, and all rights granted to the Corporation hereunder, shall be
binding upon the Participant's heirs, legal representatives and successors.
14. Entire Agreement. This Plan and the Agreement constitute the entire
agreement with respect to the subject matter hereof and thereof, provided that
in the event of any inconsistency between the Plan and the Agreement, the terms
and conditions of this Plan shall control.
15. Unfunded Status of Plan. It is intended that the Plan be an "unfunded" plan
for incentive and deferred compensation. The Committee may authorize the
creation of trust or other arrangements to meet the obligations created under
the Plan to deliver Common Stock or make payments; provided, however, that
unless the Committee otherwise determines, the existence of such trusts or other
arrangements is consistent with the "unfunded" status of the Plan.
16. Representation. The Committee may require each person purchasing or
receiving shares pursuant to an award to represent to and agree with the Company
in writing that such person is acquiring the shares without a view to the
distribution thereof. The certificates for such shares may include any legend
which the Committee deems appropriate to reflect any restrictions on transfers.
17. No Additional Obligation. Nothing contained in the Plan shall prevent the
Company or an affiliate from adopting other or additional compensation
arrangements for its employees.
18. Controlling Law. The Plan and all Awards made and actions taken thereunder
shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania (other than its law respecting choice of law).
19. No Company Obligation. Neither the Company, nor any affiliate, shall have
any duty or obligation to affirmatively disclose to an option holder or to any
other record or beneficial holder of Common Stock or an of option, and such an
option holder or other holder shall have no right to be advised of, any material
information regarding the Company or an affiliate at any time prior to, upon or
in connection with the exercise of an award or the Company's purchase of Common
Stock or an award from such holder in accordance with the terms hereof. The
Company shall have no duty or obligation to register the shares of Common Stock.
20. Headings. The headings contained in this Plan are for reference purposes
only and shall not affect the meaning or interpretation of this Plan.
21. Severability. If any provision of this Plan shall for any reason be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
effect any other provision hereby, and this Plan shall be construed as if such
invalid or unenforceable provision were omitted.
22. Entire Agreement. This Plan and the agreement constitute the entire
agreement with respect to the subject matter hereof and thereof, provided that
in the event of any inconsistency between the Plan and the agreement, the terms
and conditions of this Plan shall control.
23. Effective Date of Plan. This Plan shall be amended and restated effective as
of June 15, 1998, subject to the approval hereof by the stockholders of the
Corporation not later than June, 15, 1999. If the stockholders of the
Corporation do not approve the Plan by said date, the Plan shall be null and
void and all options granted hereunder shall similarly by null and void and of
no further force or effect. This Plan shall terminate on June, 15, 2008, unless
terminated earlier by the Board.
STOCK OPTION GRANT AGREEMENT
(Under Provisions of the AANetcom, Inc. Stock Option Plan,
Amended and Restated Effective June 15, 1998)
THIS AGREEMENT is made this ___ day of ___________, by and between
AANETCOM, INC., a Delaware corporation (hereinafter referred to as the
"Company"), qualified to transact business in the Commonwealth of Pennsylvania
and with its principal place of business located at 4949 Liberty Lane Allentown,
Pennsylvania and ______________________ an individual (hereinafter referred to
as the "Purchaser"), residing at ___________________________.
RELEVANT FACTS
A. Purchaser is employed by the Company in the position of
____________ commencing _____________.
B. The Company is engaged in a highly technical and competitive
business.
C. The Company wishes to encourage equity ownership in the Company
by Purchaser.
D. Purchaser wishes to own an equity interest in the Company.
NOW, THEREFORE, intending to be legally bound hereby, the Parties
hereto agree as follows:
AGREEMENT
1. As of the date of this agreement, Purchaser is hereby granted options to
purchase _______________ shares of stock of the Company under the following
option terms:
1. the strike price of the options is ________ per share;
2. the options become exercisable as follows: (a) 25% on the first
anniversary of the Purchaser's employment with the Company; and
(b) an additional 2-1/12% per month commencing on the first
anniversary of the Purchaser's employment with the Company, so
that the Purchaser's options shall be 100% exercisable upon the
completion of four years of continuous employment with the
Company;
3. if not exercised when first exercisable, the right to exercise
expires 5 years from the date on which the shares are first
exercisable;
4. Upon termination of employment for any reason by the Company or a
parent or subsidiary of the Company, the Purchaser may exercise
only those options which are immediately purchasable by him or
her at the date of such termination. All such options must be
exercised within three (3) months of such termination, but not
later than the date of expiration of any such option, or they
shall expire. If termination is the result of the death of the
Purchaser, such exercise may be accomplished by the executor or
administrator of the estate of the Purchaser.
2. Payment of Purchase Price.
For shares acquired through exercise under section 1, the Purchaser may
pay for these shares using either of the following methods:
1. by delivering a check equal to the strike price times the number
of shares the Purchaser has elected to exercise;
2. via installment payments, if approved by the Stock Option
Committee, for this option grant.
<PAGE>
3. Issuance of Shares. Upon receipt by the Company of the Purchase Price, the
Company shall issue to the Purchaser a duly executed certificate evidencing the
shares of Stock so acquired in the name of Purchaser.
4. Right of First Refusal. Before any shares of Stock registered in the name of
Purchaser may be sold or transferred (including transfer by operation of law or
other involuntary transfer and excluding transfers by gift, will or intestate
succession of the Purchaser to the Purchaser's spouse or lineal descendants or
ancestors or a trust for the benefit of such persons, if the transferee agrees
in writing in a form satisfactory to the company to be subject to the terms of
this Agreement), such shares shall first be offered to the Company in the
following manner:
a. The Purchaser or his or her transferee shall deliver a notice by
certified mail (hereinafter referred to as "Notice") to the principal business
office of the Company, stating (i) his or her bona fide intention to sell or
transfer such shares; (ii) the number of such shares to be sold or transferred;
(iii) the price and terms, if any, for which he or she proposes to sell or
transfer such shares; and (iv) the name and address of the proposed purchaser or
transferee and that such purchaser or transferee is committed to acquire the
stated number of shares at the stated price and on the stated terms.
b. The Company shall have the right at any time within sixty (60) days
of receipt of the Notice to purchase some or all of the shares to which the
Notice refers at the price per share specified in the Notice, or if no price is
specified therein, at the fair market value thereof as determined by the Board
of Directors in good faith. Said right shall be exercised by written notice
signed by an officer of the Company and delivered or mailed as provided in
Section 7(b), which notice shall specify the time, place and date for settlement
of such purchase, which date shall not be later than seventy-five (75) days
after the date of the Notice.
c. In the event the Company does not, for any reason, exercise all or
any part of its right pursuant hereto, the Company may assign such right or part
thereof, provided such right shall not extend beyond such 60-day period. If
exercised by the assignee pursuant hereto, the right to purchase shall be
exercised by written notice signed by the exercising assignee and delivered or
mailed as provided in Section 7(b), which notice shall specify the time, place
and date for settlement of such purchase, which date shall not be later than
seventy-five (75) days after the date of the Notice. Purchaser shall sell to the
Company or such assignees the number of shares that either of them elects to
purchase such sale to be consummated within seventy-five (75) days after the
date of the Notice.
d. If some or all of the shares to which the Notice refers are not so
purchased, as provided in Sections 5(b) and (c), the Purchaser may sell such
shares to the person named in the Notice at the price and on the terms specified
in the Notice, provided that such sale or transfer is consummated within
seventy-five (75) days of the date of said Notice to the Company, and provided
further that any such sale is in accordance with all of the terms and conditions
hereof. If Purchaser does not consummate the sale or transfer within such
seventy-five (75) day period, the right provided hereby shall be deemed to be
revived with respect to such shares, and no sale or transfer shall be effected
without first offering the shares in accordance herewith.
e. Notwithstanding the above, neither the Company nor the assignees of
the Company shall have any right under this Section 4 at any time subsequent to
the closing of a bona fide, firm commitment underwritten public offering of the
common stock of the Company pursuant to a Registration Statement declared
effective under the Securities Act of 1933, as amended.
5. "Market Stand-Off" Agreement. Purchaser hereby agrees that, during the period
specified by the Company and the underwriter or underwriters of common stock or
other securities of the Company, following the effective date of a Registration
Statement of the Company filed under the Securities Act of 1933, as amended
(hereinafter referred to as the "Act"), Purchaser shall not, to the extent
requested by the Company and such underwriter, directly or indirectly, sell,
offer or contract to sell (including without limitation any short sale), grant
any option to purchase or otherwise transfer or dispose of (other than to donees
who agree to be similarly bound) any securities of the Company at any time
during such period, except common stock included in such registration; provides,
however, that (a) such agreement shall be applicable only to the first such
Registration Statement of the Company, which covers common stock (or other
securities) to be sold on its behalf to the public in an underwritten offering;
and (b) all officers and directors of the Company holding securities of the
Company, directly or indirectly, enter into similar agreements.
In order to enforce the foregoing covenant, the Company may
impose stop transfer instructions with respect to common stock held by Purchaser
until the end of such period.
6. Representations and Warranties of Purchaser.
a. Investment Intent. This Agreement is made with Purchaser in
reliance upon his or her representation to the Company, which by his or her
acceptance hereof he or she confirms, that the Stock has been acquired with his
or her own funds for investment for an indefinite period for his or her own
account, not as a nominee or agent, and not with a view to the sale or
distribution of any part thereof, and that he or she has no present intention of
selling, granting participation in, or otherwise distributing the same. By
executing this Agreement, Purchaser further represents that he or she does not
have any contract, undertaking, agreement or arrangement with any person to
sell, transfer, or grant participation to such person or to any third person,
with respect to any of the Stock.
b. Restricted Securities. Purchaser understands that the Stock
has not been registered under the Act, on the ground that the sale provided for
in this Agreement is exempt from the registration requirements of the Act, and
that the Company's reliance on such exemption is predicated on his or her
representations set forth herein, including but not limited to Purchaser's place
of residence.
Purchaser understands that if the Company does not register
with the Securities and Exchange Commission pursuant to Section 12 or 15 of the
Securities Exchange Act of 1934, as amended, or if a Registration Statement
covering the Stock (or a filing pursuant to the exemption from registration
under Regulation A of the Act) under the Act is not in effect when he or she
desires to sell the Stock, he or she may be required to hold the Stock for an
indeterminate period. The Purchaser also acknowledges that he or she understands
that any sale of the Stock that might be made by him or her in reliance upon
Rule 144 under the Act may be made only in limited amounts in accordance with
the terms and conditions of that Rule and that he or she may not be able to sell
the Stock at the time or in the amount he or she so desires. Purchaser is
familiar with Rule 144 and understands that the Stock constitutes "restricted
securities" within the meaning of that Rule.
c. Investment Experience. In connection with the investment
representations made herein, Purchaser represents that he or she is able to fend
for himself or herself in the transactions contemplated by this Agreement, has
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of his or her investment, has the ability to
bear the economic risks of his or her investment and has been furnished with and
has had access to such information as he or she has requested and deems
appropriate to his or her investment decision.
d. Limitations on Disposition. Purchaser agrees that in no
event will he or she make a disposition of any of the Stock, unless and until he
or she shall have notified the Company of the proposed disposition and shall
have furnished the Company with a statement of the circumstances surrounding the
proposed disposition, and he or she shall have furnished the Company with an
opinion of counsel satisfactory to the Company to the effect that (i) such
disposition will not require registration of such Stock under the Act; or (ii)
that appropriate action necessary for compliance with the Act has been taken; or
(iii) the Company shall have waived, expressly and in writing, its rights under
clauses (i) and (ii) the Company shall have waived, expressly and in writing,
its rights under clauses (i) and (ii) of this Section. In addition, prior to any
disposition of any of the Stock, the Company may require the transferee or
assignee to provide in writing investment representations and its agreement to
the market stand-off provisions hereof in a form acceptable to the Company.
<PAGE>
The Company shall not be required (i) to transfer on its
books any shares of Stock of the Company which shall have been sold or
transferred in violation of any of the provisions set forth in this Agreement or
(ii) to treat as owner of such shares or to accord the right to vote as such
owner or to pay dividends to any transferee to whom such shares shall have been
so transferred. Purchaser shall, during the term of this Agreement, exercise all
rights and privileges of a shareholder of the Company with respect to the Stock
after the issuance, and prior to the repurchase, thereof.
e. Legends. All certificates representing any shares of Stock
of the Company subject to the provisions of this Agreement shall have endorsed
thereon the following legends:
(i) "THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN
COFOUNDER STOCK OPTION AGREEMENT WHICH INCLUDES A
MARKET STAND-OFF AGREEMENT AND A RIGHT OF FIRST
REFUSAL ON THE SALE OF SECURITIES. COPIES OF THE
AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE
SECRETARY OF THE CORPORATION."
(ii) "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.
THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND
NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY
NOT BE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SHARES UNDER THE SECURITIES ACT OF
1933, OR PURSUANT TO RULE 144 UNDER THE ACT OR AN
OPTION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT."
(iii) A legend required to be placed thereon by applicable
state laws.
7. Miscellaneous
a. Further Instruments and Actions. The parties hereto agree
to execute such further instruments and to take such further action as may
reasonably be necessary to carry out the intent of this Agreement.
b. Notices. Any notice required or permitted hereunder shall
be given in writing and shall be deemed effectively given upon personal delivery
or upon deposit in the United States Post Office, by registered or certified
mail with postage and fees prepaid, addressed to the other part hereto at the
address stated hereinabove for AANETCOM, INC., or to Purchaser at the address
hereinafter shown below his or her signature or at such other address as such
party may designate by ten (10) days' advance written notice to the other party
hereto.
c. Governing Law, Assignment and Enforcement. This Agreement
shall be interpreted and enforced in accord with the laws of the Commonwealth of
Pennsylvania and shall inure to the benefit of the successors and assigns of the
Company and, subject to the restrictions on transfer herein set forth, be
binding upon Purchaser, his or her heirs, executors, administrators, guardians,
successors and assigns. The prevailing party in any action to enforce this
Agreement shall be entitled to reasonable attorneys' fees and costs. The parties
agree that damages are not an adequate remedy for Purchaser's breach hereof, and
the Company shall accordingly be entitled to specific performance of this
Agreement.
d. Amendments and Waivers. This Agreement represents the
entire understanding of the parties with respect to the subject matter hereof
and supersedes all previous understandings, written or oral. This Agreement may
only be amended with the written consent of the parties hereto and the Company's
assignees pursuant to Section 4 hereof, or the successors or assigns of the
foregoing, and no oral waiver or amendment shall be effective under any
circumstances whatsoever.
e. Cooperation. Purchaser agrees to cooperate affirmatively
with the Company, to the extent reasonably requested by the Company, to enforce
rights and obligations pursuant to this Agreement.
<PAGE>
8. Pennsylvania Securities Commission. The Company has not filed for
registration of the securities which are the subject of this Agreement.
Transactions in these securities may be exempt from registration based on
Section 203(r) of the Pennsylvania Securities Act and the regulations
promulgated thereto as a small issuer transaction as defined in Section 203.187
of the regulations and/or as a sale to a principal as defined in Section 203.184
of the regulations.
9. Internal Revenue Code Section 83(b) Election. By signing below, Purchaser
acknowledges receipt of the 83(b) election attached hereto as Exhibit A.
Purchaser acknowledges that Purchaser and not the Company will be responsible
for completing the form and filing the election with the appropriate office of
the federal and state tax authorities and that if such filing is not completed
within thirty (30) days after exercise of a non-qualified option, Purchaser
shall forfeit the tax benefits of Section 83(b). Purchaser further acknowledges
that such filing should be made by registered or certified mail, return receipt
requested, and that Purchaser must retain two (2) copies of the completed form
for filing with Purchaser's state and federal tax returns for the current tax
year and an additional copy for Purchaser's records.
IN WITNESS WHEREOF, the parties hereto have executed this agreement as
of the day and year first above written.
AANetcom, Inc.
By:
_____________________________ ___________________________
Secretary President
WITNESS: PURCHASER:
_____________________________ ______________________________
(Signature)
______________________________
(Print Name)
Purchaser's Address:
______________________________
______________________________
<PAGE>
EXHIBIT A
ELECTION PURSUANT TO SECTION 83(b) OF
THE INTERNAL REVENUE CODE
This statement is being made pursuant to Section 83(b) of the Internal
Revenue Code and Treasury Regulations Section 1.83-2.
(1) The person who performed the services is:
Name: ________________________________
Address: _____________________________
_____________________________
_____________________________
SS#: _________________________________
Tax Yr: ______________________________
(2) The property with respect to which the election is being made is
_______________________ (___________) shares of the Common Stock
of AANetcom, Inc.
(3) The property was issued on ______________________________________.
(4) The property is subject to a repurchase right pursuant to which
the issuer has the right to repurchase the property at the
original purchase price if for any reason the shareholder's
employment with the issuer is terminated in the first 12 months of
employment.
(5) The fair market value at the time of transfer (determined without
regard to any restriction other than a restriction which by its
terms will never lapse) is $____________ per share.
(6) The amount paid for such property is $_____________ per share.
(7) A copy of this statement was furnished to AANetcom, Inc. of whom
Purchaser rendered the service underlying the transfer of
property.
____________________________
Purchaser
____________________________
Spouse (if any)
Dated:__________________________
WILSON SONSINI GOODRICH & ROSATI
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CALIFORNIA 94304-1050
TELEPHONE 650-493-9300 FACSIMILE 650-493-6811
April 18, 2000
PMC-Sierra, Inc.
105-8555 Baxter Place
Burnaby, British Columbia V5A 4V7
Canada
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by
PMC-Sierra, Inc. ("PMC") with the Securities and Exchange Commission on or about
April 19, 2000 (the "Registration Statement") in connection with the
registration under the Securities Act of 1933, as amended, of 282,263 shares
(the "Shares") of PMC common stock to be issued under PMC's assumed AANetcom,
Inc. Stock Option Plan ("AANetcom Plan").
It is our opinion that, when shares of PMC are issued and sold pursuant
to options granted in the manner described in the AANetcom Plan, and pursuant to
the agreements which accompany each option grant, the Shares will be legally and
validly issued, fully paid and non-assessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement and any amendments thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
/s/Wilson Sonsini Goodrich & Rosati
CONSENT OF DELOITTE & TOUCHE LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 17, 2000, with respect to the
consolidated financial statements and schedule of PMC-Sierra, Inc., included in
the Annual Report (Form 10-K) for the year ended December 26, 1999, as amended,
filed with the Securities and Exchange Commission.
/s/DELOITTE & TOUCHE LLP
Vancouver, British Columbia, Canada
April 17, 2000
