POWER SPECTRA INC /CA/
S-8, 1996-08-16
COMMERCIAL PHYSICAL & BIOLOGICAL RESEARCH
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         As filed with the Securities and Exchange Commission on August 16, 1996
                                                   Registration No. 333-
================================================================================



                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM S-8
                             REGISTRATION STATEMENT
                                      Under
                           The Securities Act of 1933

                               POWER SPECTRA, INC.
              (Exact nam of Registrant as specified in its charter)


            California                                   94-2687782       
  (State or other jurisdiction              (I.R.S. Employer Identification No.)
 of incorporation or organization) 


                                919 Hermosa Court
                           Sunnyvale, California 94086
   (Address, including zip code, of Registrant's principal executive offices)


                                 1996 STOCK PLAN
                              DIRECTOR OPTION PLAN
                            (Full title of the plan)


                                 GORDON H. SMITH
                      President and Chief Executive Officer
                               POWER SPECTRA, INC.
                                919 Hermosa Court
                           Sunnyvale, California 94086
                                 (408) 737-7977
(Name, address, and telephone number, including area code, of agent for service)


                                    Copy to:
                            ROBERT T. CLARKSON, ESQ.
                       Wilson, Sonsini, Goodrich & Rosati
                            Professional Corporation
                               650 Page Mill Road
                               Palo Alto, CA 94304
                                 (415) 493-9300
<TABLE>
<CAPTION>

                                                   CALCULATION OF REGISTRATION FEE
====================================================================================================================
                                                                        Proposed        Proposed
                                                                        Maximum         Maximum
                                                         Amount         Offering        Aggregate      Amount of
         Title of Securities to                          to be           Price          Offering      Registration
            be Registered                              Registered       Per Share        Price            Fee
- --------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>               <C>           <C>            <C>
Common Stock issuable upon exercise  of 
options  to be granted under 1996 Stock Plan           1,500,000         $1.00         $1,500,000     $1,500,000
- --------------------------------------------------------------------------------------------------------------------
Common Stock issuable under Director Option Plan         170,000         $1.00           $170,000       $170,000
- --------------------------------------------------------------------------------------------------------------------
Total shares of Common Stock                           1,670,000                       $1,670,000     $1,670,000
====================================================================================================================
<FN>

(1)      Estimated  in  accordance  with Rule  457(h)  solely for the purpose of
         calculating  the  registration  fee.  Based upon the closing prices per
         share of the Common Stock in over-the- counter trading as of August 12,
         1996.
</FN>
</TABLE>

<PAGE>

                               POWER SPECTRA, INC.

                       REGISTRATION STATEMENT ON FORM S-8


PART II - INFORMATION REQUIRED IN THE REGISTRATION STATEMENT


Item 3.        Incorporation of Documents by Reference

         There are  hereby  incorporated  by  reference  into this  Registration
Statement  and into  the  Prospectus  relating  to this  Registration  Statement
pursuant to Rule 428 the following  documents and information  heretofore  filed
with the Securities and Exchange Commission (the "Commission"):

         1. The  description of the  Registrant's  Common Stock contained in the
Registrant's  Registration  Statement  on Form 8-A dated  April 18,  1988  filed
pursuant to Section 12 of the Securities Exchange Act of 1934.

         2. The  Registrant's  Annual  Report  on Form  10-K for the year  ended
December 31, 1995.

         3. The  Registrant's  Quarterly  Reports on Form 10-Q for the  quarters
ended March 31, 1996 and June 30, 1996.

               All documents filed by the Registrant pursuant to Sections 13(a),
13(c),  14 and  15(d) of the  Securities  Exchange  Act of 1934  after  the date
hereof,  and 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  herein
and to be part hereof from the date of filing of such documents.


Item 4.        Description of Securities

               Not Applicable.


Item 5.        Interests of Named Experts and Counsel

               Not applicable.


                                      II-1
<PAGE>

Item 6.        Indemnification of Directors and Officers

        Section 317 of the California Corporations Code authorizes the Company's
Board of  Directors  to grant  indemnity  to  directors  and  officers  in terms
sufficiently broad to permit such  indemnification  under certain  circumstances
for liabilities  (including  reimbursement for expenses  incurred) arising under
the  Securities  Act of 1933, as amended (the  "Securities  Act").  Furthermore,
Article IV of the  Company's  Amended and  Restated  Articles  of  Incorporation
eliminates  the  liability  of a director  for  monetary  damages to the fullest
extent  permissible  under  California  law.  In  addition,  Article  VI of  the
Company's Bylaws provides for  indemnification  of certain officers,  directors,
employees  and other agents to the maximum  extent  permitted by the  California
Corporations Code. The Company has entered into indemnification  agreements with
its  officers  and  directors  which  provide  such  persons  with  the  maximum
indemnification  allowed under  applicable  law. These  agreements  also resolve
certain procedural and substantive matters which are not covered, or are covered
in less detail, in the Bylaws or the California Corporations Code.


Item 7.        Exemption from Registration Claimed

               Not Applicable.


Item 8.        Exhibits



Exhibit                                                
Number                               Document       
- --------------  ----------------------------------------------------------------
4.1             1996 Stock Plan

4.2*            1992 Director Option Plan

5.1             Opinion of counsel as to legality of securities being registered

23.1            Consent of Grant Thornton, LLP, Independent Certified Public
                Accountants

23.2            Consent of Ernst & Young, LLP, Independent Auditors

23.3            Consent of Counsel (contained in Exhibit 5.1).

24.1            Power of Attorney (see page II-5).

- ---------------------

*Filed as an exhibit to Registration  Statement on Form S-8 (File No. 33-57280),
as filed with the SEC on January 21, 1993.


                                      II-2

<PAGE>

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 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;

               (2) That, for the purpose of determining  any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

               (3) To  remove  from  registration  by means of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.

        (b) The undersigned  Registrant  hereby undertakes that, for purposes of
determining  any liability  under the Securities Act of 1933, each filing of the
Registrant's  annual  report  pursuant to Section  13(a) or Section 15(d) of the
Exchange  Act of 1934 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.

        (h)  Insofar  as  indemnification  for  liabilities  arising  under  the
Securities  Act of 1933, as amended may be permitted to directors,  officers and
controlling  persons of the Registrant pursuant to the items described in Item 6
of Part II of this Registration Statement, 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 of
1933  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 of 1933 and will be governed by the final adjudication of such issue.

                                      II-3
<PAGE>

                                   SIGNATURES

         Pursuant  to the  requirements  of the  Securities  Act  of  1933,  the
Registrant,  Power Spectra,  Inc.,  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  Sunnyvale,  State of
California, on the 15th day of August, 1996.

                                      POWER SPECTRA, INC.


                                      By:   /s/ Gordon H. Smith
                                            -------------------------------
                                            Gordon H. Smith, President and
                                            Chief Executive Officer


                                POWER OF ATTORNEY

         KNOW ALL PERSONS BY THESE  PRESENTS,  that each person whose  signature
appears below  constitutes  and appoints  Gordon H. Smith and Edward J. Lamb and
each of them, acting individually,  as his attorney-in-fact,  with full power of
substitution,  for  him  and in any and  all  capacities,  to  sign  any and all
amendments to this Registration Statement (including post-effective  amendments)
and to file  the  same,  with  all  exhibits  thereto  and  other  documents  in
connection  therewith,  with the  Securities  and  Exchange  Commission,  hereby
ratifying  and  confirming  our  signatures  as they may be  signed  by our said
attorney to any and all amendments to the Registration Statement.
<TABLE>

         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 dates indicated.

<CAPTION>

             Signature                                    Title                               Date
- ------------------------------------        ------------------------------------        ---------------

<S>                                         <C>                                         <C> 
 /s/ Gordon H. Smith                        President, Chief Executive Officer          August 15, 1996
- ------------------------------------        and Director (Principal Executive 
Gordon H. Smith                             Officer)                          
                                            

 /s/ Edward J. Lamb                         Chief Financial Officer  (Principal         August 15, 1996
- ---------------------------                 Financial and Accounting Officer)
Edward J. Lamb                      

 /s/ Michael I. Gamble                      Director                                    August 15, 1996
- ------------------------------------
Michael I. Gamble

 /s/ Richard A. Williams                    Director                                    August 15, 1996
- ------------------------------------
Richard A. Williams

 /s/ John Hewitt, Jr.                       Director                                    August 15, 1996
- ------------------------------------
John Hewitt, Jr.

 /s/ John W. Pauly                          Director                                    August 15, 1996
- ------------------------------------
John W. Pauly

 /s/ Gene J. Kennedy                        Director                                    August 15, 1996
- ---------------------------
Gene J. Kennedy


                                            Director                                    
- ---------------------------
James A. Glaze

</TABLE>

                                      II-4

<PAGE>



                               POWER SPECTRA, INC.
                       REGISTRATION STATEMENT ON FORM S-8

                                INDEX TO EXHIBITS




   Exhibit                                           
   Number                         Description
- ------------- -----------------------------------------------------------------
    4.1       1996 Stock Plan
    4.2*      1992 Director Option Plan
    5.1       Opinion of counsel as to legality of securities being registered
   23.1       Consent of Grant Thornton, LLP, Independent Certified Public
              Accountants
   23.2       Consent of Ernst & Young, LLP, Independent Auditors
   23.3       Consent of Counsel (contained in Exhibit 5.1)
   24.1       Power of Attorney (see page II-5)



- ---------------------------

*   Filed as an  exhibit  to  Registration  Statement  on Form S-8 (File No. 33-
    57280), as filed with the SEC on January 21, 1993.


                                       S-1


                               POWER SPECTRA, INC.
                                 1996 STOCK PLAN


     1.   Purposes of the Plan. The purposes of this Stock Plan are:

          o    to attract and retain the best available  personnel for positions
               of substantial responsibility,

          o    to provide additional incentive to Employees and Consultants, and

          o    to promote the success of the Company's business.

     Options   granted  under  the  Plan  may  be  Incentive  Stock  Options  or
Nonstatutory  Stock Options,  as determined by the  Administrator at the time of
grant.

     2.   Definitions. As used herein, the following definitions shall apply:

          (a) "Administrator"  means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.

          (b)  "Applicable  Laws" means the legal  requirements  relating to the
administration  of stock option  plans under U. S. state  corporate  laws,  U.S.
federal  and state  securities  laws,  the Code and the  applicable  laws of any
foreign country or jurisdiction where Options are, or will be, granted under the
Plan.

          (c) "Board" means the Board of Directors of the Company.

          (d) "Code" means the Internal Revenue Code of 1986, as amended.

          (e) "Committee" means a Committee appointed by the Board in accordance
with Section 4 of the Plan.

          (f) "Common Stock" means the Common Stock of the Company.

          (g) "Company" means Power Spectra, Inc., a California corporation.

          (h) "Consultant"  means any person,  including an advisor,  engaged by
the Company or a Parent or Subsidiary to render  services and who is compensated
for such services.  The term  "Consultant"  shall not include  Directors who are
paid only a  director's  fee by the  Company or who are not  compensated  by the
Company for their services as Directors.

          (i)  "Continuous  Status as an Employee or Consultant"  means that the
employment  or  consulting   relationship  with  the  Company,  any  Parent,  or
Subsidiary,  is not interrupted or terminated.  Continuous Status as an Employee
or Consultant shall not be considered interrupted in the case of (i) any


                                       -1-

<PAGE>



leave of absence approved by the Company or (ii) transfers  between locations of
the  Company  or  between  the  Company,  its  Parent,  any  Subsidiary,  or any
successor.  A leave of absence approved by the Company shall include sick leave,
military   leave,  or  any  other  personal  leave  approved  by  an  authorized
representative of the Company.  For purposes of Incentive Stock Options, no such
leave may exceed ninety days, unless  reemployment upon expiration of such leave
is guaranteed by statute or contract. If reemployment upon expiration of a leave
of absence  approved  by the Company is not so  guaranteed,  on the 181st day of
such leave any  Incentive  Stock Option held by the  Optionee  shall cease to be
treated as an Incentive  Stock Option and shall be treated for tax purposes as a
Nonstatutory Stock Option.

          (j) "Director" means a member of the Board.

          (k)  "Disability"  means total and permanent  disability as defined in
Section 22(e)(3) of the Code.

          (l)  "Employee"  means any person,  including  Officers and Directors,
employed  by the Company or any Parent or  Subsidiary  of the  Company.  Neither
service as a Director  nor payment of a director's  fee by the Company  shall be
sufficient to constitute "employment" by the Company.

          (m)  "Exchange  Act" means the  Securities  Exchange  Act of 1934,  as
amended.

          (n) "Fair Market  Value"  means,  as of any date,  the value of Common
Stock determined as follows:

               (i) If the  Common  Stock  is  listed  on any  established  stock
exchange or a national market system,  including  without  limitation the Nasdaq
National Market or The Nasdaq  SmallCap  Market of The Nasdaq Stock Market,  its
Fair  Market  Value  shall be the  closing  sales  price for such  stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system for
the last market trading day prior to the time of  determination,  as reported in
The  Wall  Street  Journal  or such  other  source  as the  Administrator  deems
reliable;

               (ii) If the  Common  Stock is  regularly  quoted by a  recognized
securities dealer but selling prices are not reported,  the Fair Market Value of
a Share of Common  Stock  shall be the mean  between  the high bid and low asked
prices for the Common  Stock on the last market  trading day prior to the day of
determination,  as reported in The Wall Street  Journal or such other  source as
the Administrator deems reliable;

               (iii) In the  absence  of an  established  market  for the Common
Stock,  the  Fair  Market  Value  shall  be  determined  in  good  faith  by the
Administrator.

          (o) "Incentive Stock Option" means an Option intended to qualify as an
incentive  stock  option  within the  meaning of Section 422 of the Code and the
regulations promulgated thereunder.



                                       -2-

<PAGE>



          (p)  "Nonstatutory  Stock  Option"  means an Option  not  intended  to
qualify as an Incentive Stock Option.

          (q) "Notice of Grant" means a written notice evidencing  certain terms
and conditions of an individual Option grant. The Notice of Grant is part of the
Option Agreement.

          (r) "Officer"  means a person who is an officer of the Company  within
the  meaning  of Section 16 of the  Exchange  Act and the rules and  regulations
promulgated thereunder.

          (s) "Option" means a stock option granted pursuant to the Plan.

          (t) "Option  Agreement" means a written  agreement between the Company
and an Optionee  evidencing  the terms and  conditions of an  individual  Option
grant. The Option Agreement is subject to the terms and conditions of the Plan.

          (u) "Option  Exchange  Program"  means a program  whereby  outstanding
options are surrendered in exchange for options with a lower exercise price.

          (v) "Optioned Stock" means the Common Stock subject to an Option.

          (w)   "Optionee"   means  an  Employee  or  Consultant  who  holds  an
outstanding Option.

          (x) "Parent"  means a "parent  corporation",  whether now or hereafter
existing, as defined in Section 424(e) of the Code.

          (y) "Plan" means this 1996 Stock Option Plan.

          (z) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor
to Rule 16b-3,  as in effect when  discretion is being exercised with respect to
the Plan.

          (aa) "Section  16(b)" means Section 16(b) of the  Securities  Exchange
Act of 1934, as amended.

          (bb)  "Share"  means a share  of the  Common  Stock,  as  adjusted  in
accordance with Section 13 of the Plan.

          (cc)  "Subsidiary"  means a "subsidiary  corporation",  whether now or
hereafter existing, as defined in Section 424(f) of the Code.

     3.   Stock Subject to the Plan.  Subject to the provisions of Section 13 of
the Plan, the maximum  aggregate number of Shares which may be optioned and sold
under the Plan is 1,500,000 Shares.  The Shares may be authorized,  but
unissued, or reacquired Common Stock.


                                       -3-

<PAGE>



          If an Option  expires or becomes  unexercisable  without  having  been
exercised in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased  Shares which were subject thereto shall become available for future
grant or sale  under  the Plan  (unless  the  Plan  has  terminated);  provided,
however, that Shares that have actually been issued under the Plan, whether upon
exercise  of an Option,  shall not be  returned to the Plan and shall not become
available for future distribution under the Plan.

     4.   Administration of the Plan.

          (a) Procedure.

               (i) Multiple  Administrative  Bodies. If permitted by Rule 16b-3,
the Plan may be  administered  by different  bodies with  respect to  Directors,
Officers who are not  Directors,  and  Employees  who are neither  Directors nor
Officers.

               (ii)  Administration  With  Respect  to  Directors  and  Officers
Subject to Section  16(b).  With respect to Option  grants made to Employees who
are also Officers or Directors subject to Section 16(b) of the Exchange Act, the
Plan shall be  administered  by (A) the Board,  if the Board may  administer the
Plan in a manner  complying  with the rules  under  Rule 16b-3  relating  to the
disinterested administration of employee benefit plans under which Section 16(b)
exempt  discretionary  grants and awards of equity securities are to be made, or
(B) a committee  designated by the Board to administer the Plan, which committee
shall be  constituted  to comply with the rules under Rule 16b-3 relating to the
disinterested administration of employee benefit plans under which Section 16(b)
exempt discretionary grants and awards of equity securities are to be made. Once
appointed,  such Committee  shall  continue to serve in its designated  capacity
until otherwise  directed by the Board. From time to time the Board may increase
the size of the Committee and appoint additional  members,  remove members (with
or without cause) and substitute new members,  fill vacancies  (however caused),
and remove all members of the Committee and thereafter  directly  administer the
Plan, all to the extent  permitted by the rules under Rule 16b-3 relating to the
disinterested administration of employee benefit plans under which Section 16(b)
exempt discretionary grants and awards of equity securities are to be made.

               (iii) Administration With Respect to Other Persons.  With respect
to Option grants made to Employees or Consultants who are neither  Directors nor
Officers of the Company,  the Plan shall be administered by (A) the Board or (B)
a committee  designated by the Board,  which  committee  shall be constituted to
satisfy  Applicable  Laws.  Once  appointed,  such Committee  shall serve in its
designated  capacity  until  otherwise  directed  by the  Board.  The  Board may
increase  the size of the  Committee  and  appoint  additional  members,  remove
members  (with or without  cause) and  substitute  new members,  fill  vacancies
(however  caused),  and  remove  all  members of the  Committee  and  thereafter
directly administer the Plan, all to the extent permitted by Applicable Laws.

          (b)  Powers of the  Administrator.  Subject to the  provisions  of the
Plan, and in the case of a Committee,  subject to the specific duties  delegated
by the Board to such Committee,  the Administrator shall have the authority,  in
its discretion:


                                       -4-

<PAGE>

               (i) to determine  the Fair Market Value of the Common  Stock,  in
accordance with Section 2(n) of the Plan;

               (ii) to select the  Consultants and Employees to whom Options may
be granted hereunder;

               (iii) to determine whether and to what extent Options are granted
hereunder;

               (iv) to  determine  the  number of  shares of Common  Stock to be
covered by each Option granted hereunder;

               (v) to approve forms of agreement for use under the Plan;

               (vi) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any award granted hereunder. Such terms and conditions
include,  but are not limited  to, the  exercise  price,  the time or times when
Options  may be  exercised  (which may be based on  performance  criteria),  any
vesting acceleration or waiver of forfeiture  restrictions,  and any restriction
or  limitation  regarding  any  Option or the  shares of Common  Stock  relating
thereto,  based in each case on such factors as the  Administrator,  in its sole
discretion, shall determine;

               (vii) to  reduce  the  exercise  price of any  Option to the then
current Fair Market  Value if the Fair Market Value of the Common Stock  covered
by such Option shall have declined since the date the Option was granted;

               (viii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;

               (ix) to  prescribe,  amend  and  rescind  rules  and  regulations
relating to the Plan,  including  rules and  regulations  relating to  sub-plans
established  for the purpose of qualifying  for  preferred  tax treatment  under
foreign tax laws;

               (x) to modify or amend each Option  (subject to Section  15(c) of
the Plan), including the discretionary  authority to extend the post-termination
exercisability  period of Options  longer than is otherwise  provided for in the
Plan;

               (xi) to authorize  any person to execute on behalf of the Company
any instrument  required to effect the grant of an Option previously  granted by
the Administrator;

               (xii) to institute an Option Exchange Program;

               (xiii)  to make all  other  determinations  deemed  necessary  or
advisable for administering the Plan.



                                       -5-

<PAGE>

          (c) Effect of Administrator's Decision. The Administrator's decisions,
determinations and  interpretations  shall be final and binding on all Optionees
and any other holders of Options.

     5.   Eligibility.  Nonstatutory  Stock  Options may be granted to Employees
and  Consultants.  Incentive Stock Options may be granted only to Employees.  If
otherwise eligible, an Employee or Consultant who has been granted an Option may
be granted additional Options.

     6.   Limitations.

          (a) Each Option shall be designated in the written option agreement as
either an  Incentive  Stock  Option or a  Nonstatutory  Stock  Option.  However,
notwithstanding  such designation,  to the extent that the aggregate Fair Market
Value  of  the  Shares  with  respect  to  which  Incentive  Stock  Options  are
exercisable  for the first time by the Optionee  during any calendar year (under
all plans of the Company and any Parent or Subsidiary)  exceeds  $100,000,  such
Options shall be treated as  Nonstatutory  Stock  Options.  For purposes of this
Section 6(a),  Incentive  Stock Options shall be taken into account in the order
in which  they  were  granted.  The Fair  Market  Value of the  Shares  shall be
determined as of the time the Option with respect to such Shares is granted.  If
an Option is granted  hereunder  that is part  Incentive  Stock  Option and part
Nonstatutory Stock Option due to becoming first exercisable in any calendar year
in excess of $100,000,  the Incentive  Stock Option portion of such Option shall
become  exercisable  first in such calendar  year,  and the  Nonstatutory  Stock
Option portion shall commence  becoming  exercisable once the $100,000 limit has
been reached.

          (b) Neither the Plan nor any Option  shall confer upon an Optionee any
right  with  respect to  continuing  the  Optionee's  employment  or  consulting
relationship  with the  Company,  nor shall they  interfere  in any way with the
Optionee's  right  or the  Company's  right  to  terminate  such  employment  or
consulting relationship at any time, with or without cause.

          (c) The  following  limitations  shall  apply to grants of  Options to
Employees:

               (i) No  Employee  shall be  granted,  in any  fiscal  year of the
Company, Options to purchase more than 300,000 Shares.

               (ii)  In  connection  with  his or  her  initial  employment,  an
Employee may be granted  Options to purchase up to an  additional 300,000 Shares
which shall not count against the limit set forth in subsection (i) above.

               (iii) The foregoing limitations shall be adjusted proportionately
in connection  with any change in the Company's  capitalization  as described in
Section 13.

               (iv) If an  Option is  canceled  in the same  fiscal  year of the
Company in which it was granted  (other than in  connection  with a  transaction
described in Section 13), the canceled Option will be counted against the limits
set forth in subsections (i) and (ii) above. For this purpose, if the exercise


                                       -6-

<PAGE>



price of an Option is reduced, the transaction will be treated as a cancellation
of the Option and the grant of a new Option.

     7.   Term of Plan. Subject to Section 19 of the Plan, the Plan shall become
effective upon the earlier to occur of its adoption by the Board or its approval
by the  shareholders  of the Company as described in Section 19 of the Plan.  It
shall continue in effect for a term of ten (10) years unless terminated  earlier
under Section 15 of the Plan.

     8.   Term of Option.  The term of each Option shall be stated in the Notice
of Grant; provided,  however, that in the case of an Incentive Stock Option, the
term shall be ten (10) years from the date of grant or such  shorter term as may
be provided in the Notice of Grant.  Moreover, in the case of an Incentive Stock
Option  granted to an Optionee  who, at the time the  Incentive  Stock Option is
granted, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary,  the term of
the  Incentive  Stock  Option  shall be five (5) years from the date of grant or
such shorter term as may be provided in the Notice of Grant.

     9.   Option Exercise Price and Consideration.

          (a) Exercise Price.  The per share exercise price for the Shares to be
issued   pursuant  to  exercise  of  an  Option  shall  be   determined  by  the
Administrator, subject to the following:

               (i) In the case of an Incentive Stock Option

                    (A)  granted to an Employee  who, at the time the  Incentive
Stock Option is granted,  owns stock representing more than ten percent (10%) of
the  voting  power of all  classes  of stock of the  Company  or any  Parent  or
Subsidiary,  the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.

                    (B) granted to any Employee other than an Employee described
in paragraph (A)  immediately  above,  the per Share  exercise price shall be no
less than 100% of the Fair Market Value per Share on the date of grant.

               (ii) In the case of a  Nonstatutory  Stock Option,  the per Share
exercise price shall be determined by the Administrator.

          (b)  Waiting  Period  and  Exercise  Dates.  At the time an  Option is
granted,  the Administrator  shall fix the period within which the Option may be
exercised and shall determine any con ditions which must be satisfied before the
Option may be  exercised.  In so doing,  the  Administrator  may specify that an
Option may not be exercised until the completion of a service period.

          (c) Form of  Consideration.  The  Administrator  shall  determine  the
acceptable form of consideration for exercising an Option,  including the method
of payment. In the case of an Incentive


                                       -7-

<PAGE>

Stock  Option,  the  Administrator   shall  determine  the  acceptable  form  of
consideration at the time of grant. Such consideration may consist entirely of:

               (i) cash;

               (ii) check;

               (iii) promissory note;

               (iv) other Shares which (A) in the case of Shares  acquired  upon
exercise of an option,  have been owned by the Optionee for more than six months
on the  date of  surrender,  and (B)  have a Fair  Market  Value  on the date of
surrender  equal to the aggregate  exercise price of the Shares as to which said
Option shall be exercised;

               (v) delivery of a properly executed exercise notice together with
such other  documentation as the  Administrator  and the broker,  if applicable,
shall require to effect an exercise of the Option and delivery to the Company of
the sale or loan proceeds required to pay the exercise price;

               (vi) a reduction  in the amount of any Company  liability  to the
Optionee,  including any liability attributable to the Optionee's  participation
in any Company-sponsored deferred compensation program or arrangement;

               (vii) any combination of the foregoing methods of payment; or

               (viii)  such other  consideration  and method of payment  for the
issuance of Shares to the extent permitted by Applicable Laws.

     10.  Exercise of Option.

          (a)  Procedure  for  Exercise;  Rights as a  Shareholder.  Any  Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the  Administrator and set
forth in the Option Agreement.

          An Option may not be exercised for a fraction of a Share.

          An Option shall be deemed  exercised  when the Company  receives:  (i)
written notice of exercise (in accordance  with the Option  Agreement)  from the
person  entitled to exercise  the Option,  and (ii) full  payment for the Shares
with respect to which the Option is  exercised.  Full payment may consist of any
consideration  and  method  of  payment  authorized  by  the  Administrator  and
permitted by the Option  Agreement and the Plan.  Shares issued upon exercise of
an Option  shall be issued in the name of the  Optionee  or, if requested by the
Optionee,  in the name of the  Optionee  and his or her spouse.  Until the stock
certificate  evidencing  such Shares is issued (as evidenced by the  appropriate
entry on the books of the Company or of a duly authorized  transfer agent of the
Company), no right to vote or receive


                                       -8-

<PAGE>



dividends or any other rights as a  shareholder  shall exist with respect to the
Optioned Stock,  notwithstanding  the exercise of the Option.  The Company shall
issue (or cause to be issued) such stock  certificate  promptly after the Option
is exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the stock certificate is issued,  except as
provided in Section 13 of the Plan.

          Exercising an Option in any manner shall decrease the number of Shares
thereafter  available,  both for  purposes  of the Plan and for sale  under  the
Option, by the number of Shares as to which the Option is exercised.

          (b)  Termination  of  Employment  or  Consulting  Relationship.   Upon
termination  of an Optionee's  Continuous  Status as an Employee or  Consultant,
other than upon the Optionee's  death or  Disability,  the Optionee may exercise
his or her Option  within such period of time as is  specified  in the Notice of
Grant to the extent  that he or she is  entitled  to  exercise it on the date of
termination  (but in no  event  later  than the  expiration  of the term of such
Option as set forth in the Notice of Grant).  In the absence of a specified time
in the Notice of Grant, the Option shall remain exercisable for three (3) months
following the Optionee's termination.  In the case of an Incentive Stock Option,
such period of time for exercise shall not exceed three (3) months from the date
of termination.  If, on the date of termination, the Optionee is not entitled to
exercise  his or her  entire  Option,  the Shares  covered by the  unexercisable
portion of the Option  shall  revert to the Plan.  If,  after  termination,  the
Optionee  does not exercise his or her Option  within the time  specified by the
Administrator, the Option shall terminate, and the Shares covered by such Option
shall revert to the Plan.

          Notwithstanding  the above,  in the event of an  Optionee's  change in
status from  Consultant to Employee or Employee to  Consultant,  the  Optionee's
Continuous Status as an Employee or Consultant shall not automatically terminate
solely as a result of such change in status.  In such event,  an Incentive Stock
Option  held by the  Optionee  shall cease to be treated as an  Incentive  Stock
Option and shall be treated for tax  purposes  as a  Nonstatutory  Stock  Option
three months and one day following such change of status.

          (c)  Disability  of  Optionee.   Upon  termination  of  an  Optionee's
Continuous  Status as an Employee or  Consultant  as a result of the  Optionee's
Disability,  the  Optionee  may  exercise  his or her Option at any time  within
twelve (12) months from the date of termination, but only to the extent that the
Optionee is entitled to exercise it on the date of termination  (and in no event
later than the  expiration  of the term of the Option as set forth in the Notice
of Grant).  If, on the date of  termination,  the  Optionee  is not  entitled to
exercise  his or her  entire  Option,  the Shares  covered by the  unexercisable
portion of the Option  shall  revert to the Plan.  If,  after  termination,  the
Optionee does not exercise his or her Option within the time  specified  herein,
the Option shall  terminate,  and the Shares covered by such Option shall revert
to the Plan.

          (d) Death of Optionee.  Upon the death of an Optionee,  the Option may
be exercised at any time within  twelve (12) months  following the date of death
(but in no event  later than the  expiration  of the term of such  Option as set
forth in the Notice of Grant), by the Optionee's estate or by a person


                                       -9-

<PAGE>

who  acquires the right to exercise  the Option by bequest or  inheritance,  but
only to the extent that the  Optionee  would have been  entitled to exercise the
Option on the date of  death.  If, at the time of  death,  the  Optionee  is not
entitled  to  exercise  his or her  entire  Option,  the  Shares  covered by the
unexercisable portion of the Option shall immediately revert to the Plan. If the
Optionee's estate or the person who acquires the right to exercise the Option by
bequest or  inheritance  does not exercise the Option within the time  specified
herein, the Option shall terminate,  and the Shares covered by such Option shall
revert to the Plan.

          (e) Buyout Provisions.  The Administrator may at any time offer to buy
out for a payment in cash or Shares, an Option previously  granted based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

          (f) Rule 16b-3.  Options granted to individuals  subject to Section 16
of the Exchange Act ("Insiders")  must comply with the applicable  provisions of
Rule 16b-3 and shall contain such  additional  conditions or restrictions as may
be required  thereunder to qualify for the maximum  exemption from Section 16 of
the Exchange Act with respect to Plan transactions.

     11.  Non-Transferability  of Options.  An Option may not be sold,  pledged,
assigned, hypothecated,  transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised,  during the
lifetime of the Optionee, only by the Optionee.

     12.  Adjustments  Upon Changes in  Capitalization,  Dissolution,  Merger or
Asset Sale.

          (a) Changes in  Capitalization.  Subject to any required action by the
shareholders  of the Company,  the number of shares of Common  Stock  covered by
each  outstanding  Option,  and the number of shares of Common  Stock which have
been  authorized for issuance under the Plan but as to which no Options have yet
been  granted  or which  have been  returned  to the Plan upon  cancellation  or
expiration of an Option,  as well as the price per share of Common Stock covered
by each such  outstanding  Option,  shall be  proportionately  adjusted  for any
increase or decrease in the number of issued  shares of Common  Stock  resulting
from a  stock  split,  reverse  stock  split,  stock  dividend,  combination  or
reclassification  of the Common Stock,  or any other increase or decrease in the
number  of  issued  shares  of  Common  Stock   effected   without   receipt  of
consideration  by  the  Company;  provided,  however,  that  conversion  of  any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of  consideration."  Such adjustment shall be made by the Board,
whose  determination  in that respect  shall be final,  binding and  conclusive.
Except as  expressly  provided  herein,  no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.

          (b)  Dissolution  or  Liquidation.   In  the  event  of  the  proposed
dissolution or liquidation of the Company,  the Administrator  shall notify each
Optionee as soon as  practicable  prior to the  effective  date of such proposed
transaction.  The Administrator in its discretion may provide for an Optionee to
have the right to exercise  his or her Option  until ten (10) days prior to such
transaction as to all of the


                                      -10-

<PAGE>

Optioned Stock covered  thereby,  including  Shares as to which the Option would
not otherwise be exercisable.  In addition,  the  Administrator may provide that
any Company  repurchase  option applicable to any Shares purchased upon exercise
of  an  Option  shall  lapse  as to  all  such  Shares,  provided  the  proposed
dissolution  or  liquidation   takes  place  at  the  time  and  in  the  manner
contemplated. To the extent it has not been previously exercised, an Option will
terminate immediately prior to the consummation of such proposed action.

          (c) Merger or Asset Sale. In the event of a merger of the Company with
or into another  corporation,  or the sale of substantially all of the assets of
the Company, each outstanding Option shall be assumed or an equivalent option or
right substituted by the successor  corporation or a Parent or Subsidiary of the
successor  corporation.  In the event that the successor  corporation refuses to
assume or  substitute  for the  Option,  the  Optionee  shall  have the right to
exercise  the Option as to all of the  Optioned  Stock,  including  Shares as to
which it would not otherwise be exercisable. If an Option is exercisable in lieu
of assumption or  substitution  in the event of a merger or sale of assets,  the
Administrator  shall  notify  the  Optionee  that  the  Option  shall  be  fully
exercisable for a period of fifteen (15) days from the date of such notice,  and
the Option shall terminate upon the expiration of such period.  For the purposes
of this  paragraph,  the Option shall be  considered  assumed if,  following the
merger or sale of assets,  the option or right  confers the right to purchase or
receive,  for each Share of  Optioned  Stock  subject to the Option  immediately
prior to the merger or sale of assets,  the consideration  (whether stock, cash,
or other  securities  or  property)  received in the merger or sale of assets by
holders  of  Common  Stock  for each  Share  held on the  effective  date of the
transaction (and if holders were offered a choice of consideration,  the type of
consideration  chosen by the holders of a majority of the  outstanding  Shares);
provided,  however, that if such consideration received in the merger or sale of
assets was not solely common stock of the successor  corporation  or its Parent,
the Administrator  may, with the consent of the successor  corporation,  provide
for the  consideration to be received upon the exercise of the Option,  for each
Share of Optioned Stock subject to the Option,  to be solely common stock of the
successor  corporation or its Parent equal in fair market value to the per share
consideration  received  by  holders  of Common  Stock in the  merger or sale of
assets.

     13.  Date of  Grant.  The date of  grant of an  Option  shall  be,  for all
purposes,  the date on which the Administrator makes the determination  granting
such Option,  or such other later date as is  determined  by the  Administrator.
Notice  of the  determination  shall  be  provided  to each  Optionee  within  a
reasonable time after the date of such grant.

     14.  Amendment and Termination of the Plan.

          (a) Amendment and Termination. The Board may at any time amend, alter,
suspend or terminate the Plan.

          (b)  Shareholder  Approval.   The  Company  shall  obtain  shareholder
approval of any Plan  amendment to the extent  necessary and desirable to comply
with  Rule  16b-3 or with  Section  422 of the Code  (or any  successor  rule or
statute or other applicable law, rule or regulation,  including the requirements
of any  exchange  or  quotation  system on which the  Common  Stock is listed or
quoted).


                                      -11-

<PAGE>

Such shareholder approval,  if required,  shall be obtained in such a manner and
to such a degree as is required by the applicable law, rule or regulation.

          (c) Effect of  Amendment or  Termination.  No  amendment,  alteration,
suspension or  termination  of the Plan shall impair the rights of any Optionee,
unless mutually  agreed  otherwise  between the Optionee and the  Administrator,
which agreement must be in writing and signed by the Optionee and the Company.

     15.  Conditions Upon Issuance of Shares.

          (a) Legal  Compliance.  Shares  shall not be  issued  pursuant  to the
exercise of an Option  unless the  exercise of such Option and the  issuance and
delivery  of such  Shares  shall  comply with all  relevant  provisions  of law,
including,  without  limitation,  the  Securities  Act of 1933, as amended,  the
Exchange Act, the rules and regulations promulgated thereunder, Applicable Laws,
and the  requirements  of any stock exchange or quotation  system upon which the
Shares  may then be  listed  or  quoted,  and shall be  further  subject  to the
approval of counsel for the Company with respect to such compliance.

          (b) Investment  Representations.  As a condition to the exercise of an
Option,  the Company may require the person  exercising such Option to represent
and warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company,  such a representation  is
required.



                                      -12-

<PAGE>

     16.  Liability of Company.

          (a)  Inability to Obtain  Authority.  The  inability of the Company to
obtain authority from any regulatory body having  jurisdiction,  which authority
is deemed by the  Company's  counsel to be necessary to the lawful  issuance and
sale of any Shares  hereunder,  shall  relieve the Company of any  liability  in
respect of the failure to issue or sell such  Shares as to which such  requisite
authority shall not have been obtained.

          (b) Grants Exceeding Allotted Shares. If the Optioned Stock covered by
an Option  exceeds,  as of the date of grant,  the number of Shares which may be
issued under the Plan without additional shareholder approval, such Option shall
be void with respect to such excess Optioned Stock, unless shareholder  approval
of an amendment sufficiently increasing the number of Shares subject to the Plan
is timely obtained in accordance with Section 15(b) of the Plan.

     17.  Reservation of Shares. The Company, during the term of this Plan, will
at all  times  reserve  and keep  available  such  number  of Shares as shall be
sufficient to satisfy the requirements of the Plan.

     18.  Shareholder  Approval.  Continuance  of the Plan  shall be  subject to
approval by the  shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted.  Such shareholder approval shall be obtained
in the manner and to the degree required under  Applicable Laws and the rules of
any stock exchange upon which the Common Stock is listed.


                                      -13-




                                   EXHIBIT 5.1



                                 August 16, 1996

Power Spectra, Inc.
919 Hermosa Avenue
Sunnyvale, California 94086

    Re:  Registration Statement on Form S-8

Ladies and Gentlemen:

    We  have  examined  (i)  the   Registration   Statement  on  Form  S-8  (the
"Registration  Statement")  to be filed by Power  Spectra,  Inc.,  a  California
corporation  (the  "Company"  or  "you"),   with  the  Securities  and  Exchange
Commission on or about August 15, 1996 in connection with the registration under
the  Securities  Act of 1933,  as amended (the "Act"),  of an aggregate  of: (A)
1,500,000  shares of your  Common  Stock  (the  "Common  Stock"),  reserved  for
issuance under options  granted or to be granted  pursuant to the Company's 1996
Stock Plan (the "Option Plan"),  (B) 170,000 shares of Common Stock reserved for
issuance  under options  granted or to be granted  under the Company's  Director
Option  Plan (the  "Director  Plan")  (all such  shares  of Common  Stock  being
hereinafter referred to as the "Shares"),  and (ii) the Prospectuses to be dated
on or about August 15, 1996 that relate to the Option Plan and the Director Plan
and to such Registration  Statement pursuant to Rule 428(a)(1) promulgated under
the Act (the  "Prospectuses").  As your  legal  counsel,  we have  reviewed  the
actions  proposed to be taken by you in  connection  with the proposed  sale and
issuance  of the Shares by the Company  under the Option  Plan and the  Director
Plan.

    It is our opinion  that,  upon  completion  of the actions  being taken,  or
contemplated  by us as your counsel to be taken, by you prior to the issuance of
the Shares pursuant to the  Registration  Statement,  the  Prospectuses  and the
Option  Plan and the  Director  Plan,  the Shares  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,  and further consent to the use of our name wherever appearing in the
Registration Statement, the Prospectuses and any subsequent amendment thereto.

                                   Very truly yours,

                                   WILSON SONSINI GOODRICH & ROSATI
                                   Professional Corporation


                                   /s/ Wilson Sonsini Goodrich & Rosati






                                  EXHIBIT 23.1

               CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS




We consent to the  incorporation by reference in the  Registration  Statement of
Power  Spectra,  Inc. on Form S-8 of our report dated  February 29, 1996, of our
audit of the  financial  statements of  Power  Spectra,  Inc. as of December 31,
1995 and for the year ended December 31, 1995, which report is included in Power
Spectra, Inc.'s annual report on Form 10-K for the year ended December 31, 1995.


                                       /s/ GRANT THORNTON LLP



San Jose, California
August 15, 1996





                                  EXHIBIT 23.2

                       CONSENT OF INDEPENDENT ACCOUNTANTS




We consent to the incorporation by reference in the Registration Statement (Form
S-8)  pertaining to the 1996 Stock Plan and 1992  Director  Option Plan of Power
Spectra,  Inc. of our report dated  February 17, 1995 (except Note 4 as to which
the date is April 7, 1995) with  respect to the  financial  statements  of Power
Spectra,  Inc.  included  in its Annual  Report  (Form  10-K) for the year ended
December 31, 1995.



                                              /s/  ERNST & YOUNG LLP



San Jose, California
August 13, 1996




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