United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ x ] Quarterly Report Pursuant To Section 13 Or 15(d) Of The Securities
Exchange Act Of 1934 For the Period Ended June 30, 1997
or
[ ] Transition Report Pursuant To Section 10 Or 15(D) Of The Securities
Exchange Act Of 1934 For The Transition Period From _________ To ________
Commission File Number 0-15449
CALIFORNIA MICRO DEVICES CORPORATION
------------------------------------
(Exact name of registrant as specified in its charter)
California 94-2672609
---------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
215 Topaz Street, Milpitas, California 95035-5430
-------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(408) 263-3214
-------------
(Registrant's telephone number, including area code)
Not applicable
--------------
(Former name, former address, and former fiscal year if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
Applicable Only to Corporate Issuers
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
As of June 30, 1997, there were outstanding 9,853,368 shares of Issuer's
Common Stock.
<PAGE>
CALIFORNIA MICRO DEVICES CORPORATION
INDEX
PART I. FINANCIAL INFORMATION
Page Number
Item 1. Financial Statements
Statements of Operations
Three Months Ended June 30, 1997 and 1996 2
Balance Sheets
June 30, 1997 and March 31, 1997 3
Statements of Cash Flows
Three Months Ended June 30, 1997 and 1996 4
Notes to Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 4. Submission of Matters to a Vote of Security Holders 9
Item 6. Exhibits and Reports on Form 8-K 10
Signature 11
ii
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements.
CALIFORNIA MICRO DEVICES CORPORATION
STATEMENTS OF OPERATIONS
(Amounts in Thousands, Except Per Share Data)
(Unaudited)
<TABLE>
Three Months Ended June 30,
1997 1996
---- ----
<S> <C> <C>
Revenues:
Net product sales $ 8,108 $ 9,295
Technology related sales 206 300
-------- --------
Total revenues 8,314 9,595
Cost and expenses:
Cost of sales 5,265 6,224
Research and development 808 987
Selling, marketing and administrative 2,016 2,152
-------- --------
Total costs and expenses 8,089 9,363
-------- --------
Operating income 225 232
Other (income) expense, net 109 (100)
-------- --------
Income before income taxes 116 332
Income taxes - -
-------- --------
Net income $ 116 $ 332
======== ========
Net income per share $ 0.01 $ 0.03
======== ========
Weighted average common shares and
share equivalents outstanding 10,226 11,020
The accompanying notes are an integral part of these financial statements.
</TABLE>
2
<PAGE>
CALIFORNIA MICRO DEVICES CORPORATION
BALANCE SHEETS
(Amounts in Thousands, Except Share Data)
(Unaudited)
<TABLE>
June 30, March 31,
1997 1997
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 95 $ 343
Short-term investments 6,136 6,467
Accounts receivable, less allowance for
doubtful accounts of $465 and $437 3,893 3,938
Inventories 9,295 8,843
Prepaid expenses and other assets 947 874
-------- --------
Total current assets 20,366 20,465
Property and equipment, net 14,408 14,481
Restricted cash 3,142 2,903
Other long-term assets 417 421
-------- --------
Total assets $38,333 $38,270
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,959 $ 2,618
Accrued salaries and benefits 1,113 795
Other accrued liabilities 1,303 1,457
Deferred margin on shipments to distributors 630 576
Current maturities of long-term debt and capital
lease obligations 719 745
------- --------
Total current liabilities 5,724 6,191
Long-term debt, less current maturities 7,315 7, 315
Capital lease obligations less current maturities 1,175 1,184
-------- --------
Total liabilities 14,214 14,690
Shareholders' equity:
Common stock - no par value; authorized 25,000,000;
issued and outstanding 9,853,368 shares 52,389 51,939
Accumulated deficit (28,270) (28,359)
-------- --------
Total shareholders' equity 24,119 23,580
-------- --------
Total liabilities and shareholders' equity $38,333 $38,270
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
CALIFORNIA MICRO DEVICES CORPORATION
STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
(Unaudited)
<TABLE>
Three Months Ended June 30,
1997 1996
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 116 $ 332
Adjustments to reconcile net income to net
cash provided (used) by operating activities:
Depreciation and amortization 673 540
Net increase in inventories (452) (575)
Net decrease/(increase) in accounts receivable 45 (58)
Net (increase)/decrease in prepaid expenses and
other current assets (73) 123
Net decrease in trade accounts payable and
other current liabilities (495) (883)
Net decrease in other long term assets 4 84
Increase/(decrease) in deferred margin on
distributor sales 54 (12)
-------- --------
Net cash used by operating activities (128) (449)
-------- --------
Cash used in investing activities:
Security purchases (499) (2,069)
Security sales 803 4,216
Capital expenditures (600) (2,790)
Net change in restricted cash (239) (239)
-------- --------
Net cash used in investing activities (535) (882)
-------- --------
Cash (used)/provided by financing activities:
Payment of capital lease obligations (35) (524)
Payment of long-term debt - (83)
Proceeds from issuance of common stock 450 936
-------- --------
Net cash provided by financing activities 415 329
-------- --------
Net decrease in cash and cash equivalents (248) (1,002)
Cash and cash equivalents at the beginning of period 343 1,512
-------- --------
Cash and cash equivalents at the end of period $ 95 $ 510
======== ========
Supplemental disclosure of cash flow information:
Interest paid $ 246 $ 64
Income taxes paid $ - $ -
Supplemental disclosures of non-cash investing and financing activities:
Unrealized gain/(loss) on securities $ 27 $ 60
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
CALIFORNIA MICRO DEVICES CORPORATION
Notes to Financial Statements
1. Basis of Presentation
---------------------
In the opinion of management, the accompanying unaudited condensed
financial statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly California Micro Devices
Corporation's (the "Company") financial position as of June 30, 1997, results
of operations for the three month periods ended June 30, 1997 and 1996, and
cash flows for the three-month periods ended June 30, 1997 and 1996. Results
for the quarter are not necessarily indicative of fiscal year results.
The condensed financial statements should be read in conjunction with
the financial statements included with the Company's annual report on Form
10-K for the fiscal year ended March 31, 1997.
2. Use of Estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. Inventories
----------
The components of inventory consist of the following (amounts in
thousands):
June 30, March 31,
1997 1997
-------- --------
Raw materials $ 1,149 $ 1,316
Work-in-process 4,429 3,821
Finished goods 3,717 3,706
-------- --------
$ 9,295 $ 8,843
4. Litigation
----------
Reference should be made to the Company's filings with the SEC,
including its reports on Form 10-K for its 1997 fiscal year. In addition to
the matters reported therein, the following legal proceedings have taken
place:
The settlement of the securities class action became final on June 20,
1997, following Judge Walker's order of May 20, 1997.
The Company has negotiated a settlement of the putative shareholders'
derivative suit, and expects to finalize that settlement shortly and to submit
it to the court for approval.
The Company is a defendant or plaintiff in various other actions which
arose in the normal course of business. In the opinion of management, the
ultimate disposition of these matters will not have a material adverse effect
on the financial condition or overall trends in the results of operation of
the Company.
5
<PAGE>
The Company believes that, with regard to these matters and those
previously reported, it has, to the best of its knowledge, made such
adjustments to its financial statements by means of reserves and expensing the
costs thereof, that these matters will not have any additional adverse impact
on the Company's financial condition.
5. Net Income Per Share
--------------------
Net income per share for each period is computed using the weighted
average number of common shares and dilutive common shares outstanding during
the periods.
6. Adoption of FASB 128
--------------------
In February 1997, the Financial Accounting Standards Board issued
Statement No. 128, Earnings per Share, which is required to be adopted on
December 31, 1997. At that time, the Company will be required to change the
method currently used to compute earnings per share and to restate all prior
periods. Under the new requirements for calculating primary earnings per
share, the dilutive effect of stock options will be excluded. The impact will
not result in any change in primary earnings per share for the quarters ended
June 30, 1997 and 1996.
6
<PAGE>
ITEM 2. Management's Discussion And Analysis of Financial Condition and
---------------------------------------------------------------
Results of Operations.
----------------------
Results of Operations
Product sales for the quarter ended June 30, 1997, decreased by
$1,187,000 or 12% compared to the quarter ended June 30, 1996. The decrease
in product sales was primarily due to a decrease in older telecommunications
and computer related products offset partially by over $500,000 of new
P/Active( products. Thin film products accounted for 62% of product sales
for the quarter ended June 30, 1997 compared with 55% in the year ago quarter.
Compared to the previous quarter ended March 31, 1997, product sales for
the quarter ended June 30, 1997 increased by $866,000 or 12%. The increase
was primarily due to the shipment of new P/Active( products mentioned above.
Thin film products were 63% of product sales for the quarter ended March 31,
1997.
Technology related revenue for the quarters ended June 30, 1997 and June
30, 1996 related to engineering projects partially funded by Hitachi Metals,
Ltd. ("HML"). Technology revenues decreased due to fewer projects being
included in the joint development programs. This decrease amounted to $94,000
and $194,000 as compared to the same quarter in fiscal 1997 and the quarter
ended March 31, 1997, respectively.
Gross margins on net product sales improved overall from the quarter a
year ago from 33% to 35%, primarily due to cost reductions and higher mix of
thin film products. Manufacturing cost reductions are the result primarily of
transfer of more test and finish work overseas and reduced packaging costs, as
well as yield improvements and benefits from prior year capital investments,
partially offset by increased depreciation expense.
Research and development expenditures decreased to $808,000 for the June
30, 1997, quarter compared to $987,000 in the year earlier period due
primarily to reduced spending on materials and outside consulting. Compared
to a year ago, a greater proportion of research and development programs
involve design engineering efforts developing new products, with less
consumption of materials associated with the development of new processes.
Selling, marketing, and administrative costs decreased by $136,000
compared to a year ago. Selling and marketing headcount and advertising
expense have increased, and administrative costs have decreased, including a
$250,000 decrease in legal expenses.
As a result of the factors discussed above, operating income for the
quarter ended June 30, 1997, was $225,000 compared to operating income of
$232,000 for the year earlier quarter.
Other (income)/expense for the current quarter was an expense of $109,000
as compared to income of $100,000 in the 1996 quarter. This was due primarily
to reduced interest income from investments.
No income taxes were accrued for the quarters ended June 30, 1997, or
June 30, 1996, due to the availability of tax loss carry forwards.
The weighted average of common shares outstanding decreased to 10,226,000
shares and share equivalents in the June 30, 1997, quarter compared to
11,020,000 shares and share equivalents for the quarter ended June 30, 1996.
The decrease of 794,000 weighted shares outstanding is primarily due to the
impact of the final settlement of shareholders lawsuits which reduced the
number of shares in the settlement by 891,304 shares.
7
<PAGE>
Liquidity and Capital Resources
Net cash as of June 30, 1997, decreased $579,000 from the period ending
March 31, 1997. This was due in part to the Company investing $600,000 in new
production equipment. Inventory levels increased by $452,000 in anticipation
of new product orders for the P/Active( products. The increase in work in
process inventories was offset by reductions in raw materials while finished
goods remained virtually flat. Accounts payable and other liabilities dropped
$495,000 during the period ending June 30, 1997, as payments were made for
assembly charges accrued at fiscal year-end 1997. Offsetting these decreases
were receipts from common stock purchases by employees through the exercise of
options and the Employee Stock Purchase Plan amounting to $450,000 and
depreciation and amortization of $673,000.
The Company has extended and revised its Line of Credit with a bank to
July 31, 1998, to allow borrowing up to $3,000,000, at prime, with no
collateral required. The terms of the amended agreement require the Company
to pay a commitment fee equal to one-quarter percent (1/4%) per annum on the
average daily unused amount of the Line of Credit. In addition, the Company
is required to meet certain financial covenants during the term of the
agreement. Since its inception in 1995, there have been no borrowings against
this line of credit.
Cautionary Statement
Statements included herein which are not historical facts are forward
looking statements. Such forward looking statements are made pursuant to the
safe harbor provisions of the Private/Securities Litigation Reform Act of
1995. The forward looking statements regarding revenues, orders and sales
involve a number of risks and uncertainties, including but not limited to,
demand for the Company's products, pricing pressures which could affect the
Company's gross margin or the ability to consummate sales, intense competition
within the industry, the need for the Company to keep pace with technological
developments and respond in a timely manner to changes in customer needs, the
Company's dependence on third party suppliers for components for its products
and the Company's dependence upon intellectual property rights which, if not
available to the Company, could have a material adverse effect on the Company.
These same factors, as well as others, such as the continuing litigation
involving the Company, could also affect the liquidity needs of the Company.
8
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings.
------------------
Reference should be made to the Company's filings with the SEC,
including its reports on Form 10-K for its 1997 fiscal year. In addition to
the matters reported therein, the following legal proceedings have taken
place:
The settlement of the securities class action became final on June 20,
1997, following Judge Walker's order of May 20, 1997.
The Company has negotiated a settlement of the putative shareholders'
derivative suit, and expects to finalize that settlement shortly and to submit
it to the court for approval.
The Company is a defendant or plaintiff in various other actions which
arose in the normal course of business. In the opinion of management, the
ultimate disposition of these matters will not have a material adverse effect
on the financial condition or overall trends in the results of operation of
the Company.
The Company believes that, with regard to these matters and those
previously reported, it has, to the best of its knowledge, made such
adjustments to its financial statements by means of reserves and expensing the
costs thereof, that these matters will not have any additional adverse impact
on the Company's financial condition.
ITEM 4. Submission of Matters to a Vote of Security Holders.
----------------------------------------------------
The Company's annual meeting of stockholders, at which the proposals
described below were submitted to stockholders, was held on July 18, 1997.
Proposal No. 1 The proposal to amend the bylaws of the Company to
--------------
eliminate cumulative voting was approved. The results of the voting was as
follows:
FOR AGAINST WITHHELD
--------- --------- ---------
5,474,462 1,010,694 1,642,733
Proposal No. 2 Election of Directors. The following individuals, who
--------------
received the votes indicated, were elected as directors:
NAME FOR WITHHELD
Jeffrey Kalb 6,861,792 1,266,097
Wade Meyercord 6,860,730 1,267,159
Donald Waite 6,859,000 1,268,889
Dr. John Sprague 6,858,740 1,269,149
Dr. Angel Jordan 6,857,740 1,270,149
Stuart Schube 6,857,400 1,270,489
Proposal No. 3 The proposal to ratify the appointment of Ernst &
--------------
Young LLP, as the Company's independent auditors for the current fiscal year
was approved. The results of the voting was as follows:
FOR AGAINST WITHHELD
--------- -------- ---------
7,114,321 241,705 771,863
9
<PAGE>
Proposal No. 4 The proposal to approve the amendment of the 1995
--------------
Employee Stock Purchase Plan was approved. The results of the voting was
as follows:
FOR AGAINST WITHHELD
--------- --------- ---------
6,607,844 1,406,905 113,140
Proposal No. 5 The proposal to approve the amendment of the 1995
--------------
Employee Stock Option Plan was approved. The results of the voting was as
follows:
FOR AGAINST WITHHELD
--------- --------- ---------
5,896,583 2,104,492 126,814
Proposal No. 6 The proposal to approve the amendment of the 1995
--------------
Non-Employee Directors' Stock Option Plan was approved. The results of the
voting was as follows:
FOR AGAINST WITHHELD
--------- --------- ---------
5,781,386 2,216,597 129,906
ITEM 6. Exhibits and Reports on Fork 8-K.
---------------------------------
(a) Exhibit Description
------- -----------
Exhibit 11 Computation of Per Share Earnings
3(ii) By-Laws Of California Micro Devices
Corporation, as amended
10.03 1995 Stock Option Plan Amended As Of July
26, 1996, Amended As Of July 18, 1997
10.04 1995 Non-Employee Directors' Stock Option
Plan Amended As Of July 26, 1996, Amended As
Of July 18, 1997
10.05 1995 Employee Stock Purchase Plan Amended As
Of July 18, 1997
(b) Form 8-K None
(c) Financial Data Schedule (EDGAR Filing Only)
10
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CALIFORNIA MICRO DEVICES CORPORATION
------------------------------------
(Registrant)
Date: August 13, 1997 /s/ John E. Trewin
--------------------------------------
John E. Trewin
Vice President and Chief Financial Officer
11
<PAGE>
EXHIBIT 11
CALIFORNIA MICRO DEVICES CORPORATION
Computation of Per Share Earnings
(Amounts in Thousands, Except Per Share Data)
(Unaudited)
<TABLE>
Three Months Ended June 30,
1997 1996
---------- ----------
<S> <C> <C>
Net income $ 116 $ 332
PRIMARY:
Weighted average common shares outstanding 9,756 10,365
Common equivalents attributable to options 470 655
Total weighted average common and common equivalent
shares outstanding 10,226 11,020
Net income per share $ 0.01 $ 0.03
FULLY DILUTED:
Weighted average common shares outstanding 9,756 10,365
Common equivalent attributable to options 470 657
Total weighted average common and common equivalent
shares outstanding 10,226 11,022
Net income per share $ 0.01 $ 0.03
</TABLE>
12
<PAGE>
EXHIBIT 3(ii)
BY-LAWS
of
CALMIDEV CORPORATION
a California corporation
___________________
ARTICLE I
----------
DIRECTORS; MANAGEMENT
---------------------
Section 1. a. Powers.
-------
Subject to the provisions of the General Corporation Law
of California, effective January 1, 1977 (to which the various Section numbers
quoted herein relate) and subject to any limitation in the Articles of
Incorporation and the By-Laws relating to action required to be approved by
the Shareholders (Sec. 153) or by the outstanding shares (Sec. 152), the
business and affairs of this corporation shall be managed by and all corporate
powers shall be exercised by or under direction of the Board of Directors.
b. Standard of Care.
-----------------
Each Director shall exercise such powers and otherwise
perform such duties in good faith, in the manner such Director believes to be
in the best interests of the corporation, and with such care, including
reasonable inquiry, using ordinary prudence, as a person in a like position
would use under similar circumstances. (Sec. 309)
c. Exception for Close Corporation.
--------------------------------
Notwithstanding the provisions of Section 1, in the event
that this corporation shall elect to become a close corporation as defined in
Sec. 158, its Shareholders may enter into a Shareholders' Agreement as
provided in Sec. 300 (b). Said agreement may provide for the exercise of
corporate powers and the management of the business and affairs of this
corporation by the Shareholders, provided however such agreement shall, to the
extent and so long as the discretion or the powers of the Board in its
management of corporate affairs is controlled by such agreement, impose upon
each Shareholder who is a party thereof, liability for managerial acts
performed or omitted by such person pursuant thereto otherwise imposed upon
Directors as provided in Sec. 300 (d).
Section 2. Number and Qualification.
-------------------------
The authorized number of Directors of the corporation shall be
at least five but no more than nine.
13
<PAGE>
This number may be changed by amendment to the Articles of
Incorporation or by an amendment to this Section 2, ARTICLE I, of these By-
Laws, adopted by the vote or written assent of the Shareholders entitled to
exercise majority voting power as provided in Sec. 212.
Section 3. Election and Tenure of Office.
------------------------------
The Directors shall be elected by ballot at the annual meeting
of the Shareholders, to serve for one year or until their successors are
elected and have qualified. Their term of office shall begin immediately after
election.
Section 4. Vacancies.
----------
Vacancies in the Board of Directors may be filled by a majority
of the remaining Directors, though less than a quorum, or by a sole remaining
Director, and each Director so elected shall hold office until his successor
is elected at an annual meeting of Shareholders or at a special meeting called
for that purpose.
The Shareholders may at any time elect a Director to fill any
vacancy not filled by the Directors, and may elect the additional Directors at
the meeting at which an amendment of the By-Laws is voted authorizing an
increase in the number of Directors.
A vacancy or vacancies shall be deemed to exist in case of the
death, resignation or removal of any Director, or if the Shareholders shall
increase the authorized number of Directors but shall fail at the meeting at
which such increase is authorized, or at an adjournment thereof, to elect the
additional Director so provided for, or in case the Shareholders fail at any
time to elect the full number of authorized Directors.
If the Board of Directors accepts the resignation of a Director
tendered to take effect at a future time, the Board, or the Shareholders,
shall have power to elect a successor to take office when the resignation
shall become effective.
No reduction of the number of Directors shall have the effect
of removing any Director prior to the expiration of his term of office.
Section 5. Removal of Directors.
---------------------
The entire Board of Directors or any individual Director may be
removed from office as provided by Secs. 302, 303 and 304 of the Corporations
Code of the State of California. In such case, the remaining Board members may
elect a successor Director to fill such vacancy for the remaining unexpired
term of the Director so removed.
Section 6. Notice, Place and Manner of Meetings.
-------------------------------------
Meetings of the Board of Directors may be a called by the
Chairman of the Board, or the President, or any Vice President, or the
Secretary, or any two (2) Directors and shall be held at the principle
executive office of the corporation in the
14
<PAGE>
State of California, unless some other place is designated in the notice of
the meeting. No notice need be given of organization meetings or regular
meetings held at the corporate offices at the time and date set forth herein.
Notice shall be given of other meetings as herein provided. Members of the
Board may participate in a meeting through use of a conference telephone or
similar communications equipment so long as all members participating in such
a meeting can hear one another. Accurate minutes of any meeting of the Board,
or any committee thereof, shall be maintained as required by Sec. 1500 of the
Code by the Secretary or other Officer designated for that purpose.
Section 7. Organization Meetings - regular Meetings.
-----------------------------------------
The organization meetings of the newly elected Board of
Directors shall be held immediately following the adjournment of the annual
meetings of the Shareholders.
Other Regular Meetings.
-----------------------
Regular meetings of the Board of Directors shall be held at the
corporate offices, or such other place as may be designated by the Board of
Directors, as follows:
Time of Regular Meeting: 7:30 p.m.
Date of Regular Meeting: third Thursday of August
If said day shall fall upon a holiday, such meetings shall be held on the next
succeeding business day thereafter.
Section 8. Special Meetings - Notices.
---------------------------
Special meetings of the Board may be called at any time by the
President or, if he is absent or unable or refuses to act, by any Vice
President or the Secretary or by any two Directors, or by one Director if only
one is provided.
At least forty-eight (48) hours notice of the time and place of
special meetings shall be delivered personally to the Directors or personally
communicated to them by a corporate Officer by telephone or telegraph. If the
notice is sent to a Director by letter, it shall be addressed to him at his
address as it is shown upon the records of the corporation, (or if it is not
so shown on such records or is not readily ascertainable, at the place in
which the meetings of the Directors are regularly held). In case such notice
is mailed, it shall be deposited in the United States mail, postage prepaid,
in the place in which the principle executive office of the corporation is
located at least four (4) days prior to the time of the holding of the
meeting. Such mailing, telegraphing, telephoning or delivery as above provided
shall be due, legal and personal notice to such Director.
Section 9. Waivers.
--------
When (i) all of the Directors are present at any
organizational, regular or special meeting, however called or noticed,
and sign a written consent thereto on the records
15
<PAGE>
of such meeting, or, (ii) if a majority of the Directors are present and if
those not present sign a waiver of notice of such meeting or a consent to
holding the meeting or an approval of the minutes thereof, whether prior to
or after the holding of such meeting, which said waiver, consent or approval
shall be filed with the corporate records or made a part of the minutes of the
meeting or (iii) if a Director attends a meeting without notice but without
protesting, prior thereto or at its commencement, the lack of notice to him,
then the transactions thereof are as valued as if had at a meeting regularly
called and noticed.
Section 10. Sole Director Provided by Articles of Incorporation.
-----------------------------------------------------
In the event only one Director is required by the By-Laws or
Articles of Incorporation, then any reference herein to notices, waivers,
consents, meetings or other actions by a majority or quorum of the Directors
shall be deemed to refer to such notice, waiver, etc., by such sole Director,
who shall have all the rights and duties and shall be entitled to exercise all
of the powers and shall assume all the responsibilities otherwise herein
described as given to a Board of Directors.
Section 11. Directors Acting by Unanimous Written Consent.
----------------------------------------------
Any action required or permitted to be taken by the Board of
Directors may be taken without a meeting and with the same force and effect as
if taken by a unanimous vote of Directors, if authorized by a writing signed
individually or collectively by all members of the Board. Such consent shall
be filed with the regular minutes of the Board.
Section 12. Quorum.
-------
A majority of the number of Directors as fixed by the Articles
of Incorporation or By-Laws shall be necessary to constitute a quorum for the
transaction of business, and the action of a majority of the Directors present
at any meeting at which there is a quorum, when duly assembled, is valid as a
corporate act; provided that a minority of the Directors, in the absence of a
quorum, may adjourn from time to time, but may not transact any business. A
meeting at which a quorum is initially present may continue to transact
business, notwithstanding the withdrawal of Directors, if any action taken is
approved by a majority of the required quorum for such a meeting.
Section 13. Notice of Adjournment.
----------------------
Notice of the time and place of holding an adjourned meeting
need not be given to absent Directors if the time and place be fixed at the
meeting adjourned and held within twenty-four (24) hours, but if adjourned
more than twenty-four (24) hours, notice shall be given to all Directors not
present at the time of the adjournment.
Section 14. Compensation of Directors.
--------------------------
Directors, as such, shall not receive any stated salary
for their services, but by resolution of the Board a fixed sum and
expense of attendance, if any, may be allowed for att-
16
<PAGE>
endance at each regular and special meeting of the Board; provided that
nothing herein contained shall be construed to preclude any Director from
serving the company in any other capacity and receiving compensation therefor.
Section 15. Committees.
-----------
Committees of the Board may be appointed by resolution passed
by a majority of the whole Board. Committees shall be composed of two or more
members of the Board, and shall have such powers of the Board as may be
expressly delegated to it by resolution of the Board of Directors, except
those powers expressly made non-delegable by Sec. 311.
Section 16. Advisory Directors.
-------------------
The Board of Directors from time to time may elect one or more
persons to be Advisory Directors who shall not by such appointment be members
of the Board of Directors. Advisory Directors shall be available from time to
time to perform special assignments specified by the President, to attend
meetings of the Board of Directors upon invitation and to furnish consultation
to the Board. The period during which the title shall be held may be
prescribed by the Board of Directors. If no period is prescribed, the title
shall be held at the pleasure of the Board.
Section 17. Resignations.
-------------
Any Director may resign effective upon giving written notice to
the Chairman of the Board, the President, the Secretary or the Board of
Directors of the corporation, unless the notice specifies a later time for the
effectiveness of such resignation. If the resignation is effective at a future
time, a successor may be elected to take office when the resignation becomes
effective.
ARTICLE II
----------
OFFICERS
--------
Section 1. Officers.
---------
The Officers of the corporation shall be a Chairman of the
Board or a President or both, a Secretary and a Chief Financial Officer. The
corporation may also have, at the discretion of the Board of Directors, one or
more Vice Presidents, one or more Assistant Secretaries and such other
Officers as may be appointed in accordance with the provisions of Section 3 of
this Article. One person may hold two or more offices.
Section 2. Election.
---------
The Officers of the corporation, except such Officers as
may be appointed in accordance with the provisions of Section 3 or
Section 5 of this Article shall be chosen annually by the Board
of Directors, and each shall hold his office until he
17
<PAGE>
shall resign or shall be removed or otherwise disqualified to serve, or his
successor shall be elected and qualified.
Section 3. Subordinate Officers, Etc.
--------------------------
The Board of Directors may appoint such other Officers as the
business of the corporation may require, each of whom shall hold office for
such a period, have such authority and perform such duties as are provided in
the By-Laws or as the Board of Directors may from time to time determine.
Section 4. Removal and Resignation.
------------------------
Any Officer may be removed, either with or without cause, by a
majority of the Directors at the time in office, at any regular or special
meeting of the Board, or, except in case of an Officer chosen by the Board of
Directors, by any Officer upon whom such power of removal may be conferred by
the Board of Directors.
Any Officer may resign at any time by giving written notice to
the Board of Directors, or to the President, or to the Secretary of the
corporation. Any such resignation shall take effect at the date of the receipt
of such notice or at any later time specified therein; and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary
to make it effective.
Section 5. Vacancies.
----------
A vacancy in any office because of death, resignation, removal,
disqualification or any other cause shall be filled in the manner prescribed
in the By-Laws for regular appointments to such office.
Section 6. Chairman of the Board.
----------------------
The Chairman of the Board, if there shall be such an Officer,
shall, if present, preside at all meetings of the Board of Directors, and
exercise and perform such other powers and duties as may be from time to time
assigned to him by the Board of Directors or prescribed by the By-Laws.
Section 7. President.
----------
Subject to such supervisory powers, if any, as may be
given by the Board of Directors to the Chairman of the Board, if
there be such an Officer, the President shall be the Chief Executive
Officer of the corporation and shall, subject to the control of the
Board of Directors, have general supervision, direction and control
of the business and Officers of the corporation. He shall preside at
all meetings of the Shareholders and in the absence of the Chairman of the
Board, or if there be none, at all meetings of the Board of Directors. He
shall be ex officio a member of all the standing committees, including the
Executive Committee, if any, and shall have the general powers and duties of
management usually vested in the office of President of a corporation, and
18
<PAGE>
shall have such other powers and duties as may be prescribed by the Board of
Directors or the By-Laws.
Section 8. Vice President.
---------------
In the absence or disability of the President, the Vice
Presidents, in order of their rank as fixed by the Board of Directors, or if
not ranked, the Vice President designated by the Board of Directors, shall
perform all the duties of the President, and when so acting shall have all the
powers of, and be subject to, all the restrictions upon, the President. The
Vice Presidents shall have such other powers and perform such other duties as
from time to time may be prescribed for them respectively by the Board of
Directors or the By-Laws.
Section 9. Secretary.
----------
The Secretary shall keep, or cause to be kept, a book of
minutes at the principle office or such other place as the Board of Directors
may order, of all meetings of Directors and Shareholders, with the time and
place of holding, whether regular or special, and if special, how authorized,
the notice thereof given, the names of those present at Directors' meetings,
the number of shares present or represented at Shareholders' meetings and the
proceedings thereof.
The Secretary shall keep, or cause to be kept, at the principle
office or at the office of the corporation's transfer agent, a share register,
or duplicate share register, showing the names of the Shareholders and their
addresses; the number and classes of shares held by each ; the number and date
of certificates issued for the same; and the number and date of cancellation
of every certificate surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all
the meetings of the Shareholders and of the Board of Directors required by the
By-Laws or by law to be given, and he shall keep the seal of the corporation
in safe custody, and shall have such other powers and perform such other
duties as may be prescribed by the Board of Directors or by the By- Laws.
Section 10. Chief Financial Officer.
------------------------
This Officer shall keep and maintain, or cause to be kept and
maintained in accordance with generally accepted accounting principles,
adequate and correct accounts of the properties and business transactions of
the corporation, including accounts of its assets, liabilities, receipts,
disbursements, gains, losses, capital, earnings (or surplus) and shares. The
books of account shall at all reasonable times be open to inspection by any
Director.
This Officer shall deposit all moneys and other valuables
in the name and to the credit of the corporation with such depositories
as may be designated by the Board of Directors. He shall disburse the funds
of the corporation as may be ordered by the Board of Directors, shall
render to the President and Directors,
19
<PAGE>
whenever they request it, an account of all of his transactions and of the
financial condition of the corporation, and shall have such other powers and
perform such other duties as may be prescribed by the Board of Directors of
the By-Laws.
ARTICLE III
-----------
SHAREHOLDERS' MEETINGS
----------------------
Section 1. Place of Meetings.
------------------
Meetings of the Shareholders shall be held at the principal
executive office of the corporation, in the State of California, unless some
other appropriate and convenient location be designated for that purpose from
time to time by the Board of Directors.
Section 2. Annual Meetings.
----------------
The annual meetings of the Shareholders shall be held, each
year, at the time and on the day following:
Time of Meeting: 7:00 o'clock p.m.
Date of Meeting: third Thursday in August
If this day shall be a legal holiday, then the meeting shall be held on the
next succeeding business day, at the same hour. At the annual meeting, the
Shareholders shall elect a Board of Directors, consider reports of the affairs
of the corporation and transact such other business as may be properly brought
before the meeting.
Section 3. Special Meetings.
-----------------
Special meetings of the Shareholders may be called at any time
by the Board of Directors, the Chairman of the Board, the President, a Vice
President, the Secretary, or by one or more Shareholders holding not less than
one-tenth (1/10) of the voting power of the corporation. Except as next
provided, notice shall be given as for the annual meeting.
Upon receipt of a written request addressed to the Chairman,
President, Vice President, or Secretary, mailed or delivered personally to
such Officer by any person (other than the Board) entitled to call a special
meeting of Shareholders, such Officer shall cause notice to be given, to the
Shareholders entitled to vote, that a meeting will be held at a time requested
by the person or persons calling the meeting, not less than twenty-five nor
more than sixty days after the receipt of such a request. If such notice is
not given within twenty days after receipt of such request, the persons
calling the meeting may give notice thereof in the manner provided by these
By-Laws or apply to the Superior Court as provided in Sec. 305(c).
20
<PAGE>
Section 4. Notice of Meetings - Reports.
-----------------------------
Notice of meetings, annual or special, shall be given in
writing not less than ten nor more than sixty days before the date of the
meeting, to Shareholders entitled to vote thereat by the Secretary or the
Assistant Secretary, or if there be no such Officer, or in the case of his
neglect or refusal, by any Director or Shareholder.
Such notices or any reports shall be given personally or by
mail or other means of written communication as provided in Sec. 601 of the
Code and shall be sent to the Shareholder's address appearing on the books of
the corporation, or supplied by him to the corporation for the purpose of
notice, and in the absence thereof, as provided in Sec. 601 of the Code.
Notice of any meeting of Shareholders shall specify the place,
the day and the hour of meeting, and (1) in case of a special meeting, the
general nature of the business to be transacted and no other business may be
transacted, or (2) in the case of an annual meeting, those matters which the
Board at date of mailing, intends to present for action by the Shareholders.
At any meetings where Directors are to be elected, notice shall include the
names of the nominees, if any, intended at date of Notice to be presented by
management for election.
If a Shareholder supplies no address, notice shall be deemed to
have been given to him if mailed to the place where the principal executive
office of the company, in California, is situated, or published at least once
in some newspaper of general circulation in the County of said principal
office.
Notice shall be deemed given at the time it is delivered
personally or deposited in the mail or sent by other means of written
communication. The Officer giving such notice or report shall prepare and file
an affidavit or declaration thereof.
When a meeting is adjourned for forty-five days or more, notice
of the adjourned meeting shall be given as in case of an original meeting.
Save, as aforesaid, it shall not be necessary to be give any notice of
adjournment or of the business to be transacted at an adjourned meeting other
than by announcement at the meeting at which such adjournment is taken.
Section 5. Validation of Shareholders' Meetings.
-------------------------------------
The transactions of any meeting of Shareholders, however called
and noticed, shall be valid as though had at a meeting duly held after regular
call and notice, if a quorum be present either in person or proxy, and if,
either before or after the meeting, each of the Shareholders entitled to vote,
not present in person or by proxy, sign a written waiver of notice, or a
consent to the holding of such a meeting or an approval of the minutes
thereof. All such waivers, consents or approvals shall be filed with the
corporate records or made a part of the minutes of the meeting. Attendance
shall constitute a waiver of notice, unless objection shall be made as
provided in Sec. 601(e).
21
<PAGE>
Section 6. Shareholders Acting Without a Meeting - Directors.
--------------------------------------------------
Any action which may be taken at a meeting of the Shareholders
may be taken without a meeting or notice of meeting if authorized by a writing
signed by all of the Shareholders entitled to vote at a meeting for such
purpose and filed with the Secretary of the corporation, provided further that
while ordinarily Directors can only be elected by unanimous written consent
under Sec. 603(d), as to vacancy created by death, resignation or other
causes, if the Directors fail to fill a vacancy, then a Director to fill that
vacancy may be elected by the written consent of persons holding a majority of
shares entitled to vote for the election of Directors.
Section 7. Other Actions Without A Meeting.
--------------------------------
Unless otherwise provided in the GCL or the Articles, any action
which may be taken at any annual or special meeting of Shareholders may
be taken without a meeting and without prior notice if a consent in writing,
setting forth the action so taken, shall be signed by the holders of
outstanding shares having not less than the minimum number of votes that would
be necessary to authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted.
Unless the consents of all Shareholders entitled to vote have
been solicited in writing,
(1) Notice if any Shareholder approval pursuant to Secs.
310, 317, 1201 or 2007 without a meeting by less than unanimous written
consent shall be given at least 10 days before the consummation of the action
authorized by such approval, and
(2) Prompt notice shall be given of the taking of any
corporate action approved by Shareholders without a meeting by less than
unanimous written consent, to each of those Shareholders entitled to vote who
have not consented in writing.
Any Shareholder giving a written consent, or the Shareholder's
proxyholders, or a transferee of the shares of a personal representative of
the Shareholder or their respective proxyholders, may revoke the consent by a
writing received by the corporation prior to the time that written consents of
the number of shares required to authorize the proposed action have been filed
with the Secretary of the corporation, but may not do so thereafter. Such
revocation is effective upon its receipt by the Secretary.
Section 8. Quorum.
-------
The holders of a majority of the shares entitled to vote
thereat, present in person, or represented by proxy, shall constitute a
quorum at all meetings of the Shareholders for the transaction of business
except as otherwise provided by law, by the Articles of Incorporation, or by
these By-Laws. If, however, such majority shall not be present or represented
at any meeting of the Shareholders, the Shareholders entitled to vote
thereat, present in person, or by proxy, shall have the power to adjourn
the meeting from time to time, until the requisite amount of voting shares
shall be present. At such adjourned meeting at which the requisite
22
<PAGE>
amount of voting shares shall be represented, any business may be transacted
which might have been transacted at a meeting as originally notified.
If a quorum be initially present, the Shareholders may continue
to transact business until adjournment, not withstanding the withdrawal of
enough Shareholders to leave less than a quorum, if any action taken is
approved by a majority of the Shareholders required to initially constitute a
quorum.
Section 9. Voting Rights; Cumulative Voting.
---------------------------------
Only persons in whose names shares entitled to vote stand on
the stock records of the corporation on the day of any meeting of
Shareholders, unless some other day be fixed by the Board of Directors for the
determination of Shareholders of record, and then on such other day, shall be
entitled to vote at such meeting.
Provided the candidate's name has been placed in nomination
prior to the voting and one or more Shareholders has given notice at the
meeting prior to the voting of the Shareholder's intent to cumulate the
Shareholder's votes, every Shareholder entitled to vote at any election for
Directors of any corporation for profit may cumulate his votes and give one
candidate a number of votes equal to the number of directors to be elected
multiplied by the number of votes to which his shares are entitled, or
distribute his votes on the same principle among as many candidates as he
thinks fit.
The candidates receiving the highest number of votes up to the
number of Directors to be elected are elected.
The Board of Directors may fix a time in the future not
exceeding sixty days preceding the date of any meeting of Shareholders or the
date fixed for the payment of any dividend or distribution, or for the
allotment of rights, or when any change or conversion or exchange of shares
shall go into effect, as a record date for the determination of the
Shareholders entitled to notice of and to vote at any such meeting, or
entitled to receive any such dividend or distribution, or any allotment of
rights, or to exercise the rights in respect to any such change, conversion or
exchange of shares. In such a case only Shareholders of record on the date so
fixed shall be entitled to notice of and to vote at such meeting, or to
receive such dividends, distribution or allotment of rights, or to exercise
such rights, as the case may be, notwithstanding any transfer of any share on
the books of the company after any record date fixed as aforesaid. The Board
of Directors may close the books of the company against transfers of shares
during the whole or any part of such a period.
Section 10. Proxies.
--------
Every Shareholder entitled to vote, or to execute consents,
may do so, either in person or by written proxy, executed in accordance with
the provisions of Secs. 604 and 705 of the Code and filed with the Secretary
of the corporation.
23
Section 11. Organization.
-------------
The President, or in the absence of the President, any Vice
President, shall call the meeting of the Shareholders to order, and shall act
as chairman of the meeting. In the absence of the President and all of the
Vice Presidents, Shareholders shall appoint a chairman for such a meeting. The
Secretary of the company shall act as Secretary of all meetings of the
Shareholders, but in the absence of the Secretary at any meeting of the
Shareholders, the presiding Officer may appoint any person to act as Secretary
of the meeting.
Section 12. Inspectors of Election.
-----------------------
In advance of any meeting of Shareholders the Board of
Directors may, if they so elect, appoint inspectors of election to act at such
a meeting or any adjournments thereof. If inspectors of election be not so
appointed, the chairman of any such meeting may, and on the request of any
Shareholder or his proxy shall, make such appointment at the meeting in which
case the number of inspectors shall be either one or three as determined by a
majority of the Shareholders represented at the meeting.
Section 13. Shareholder' Agreements.
------------------------
Notwithstanding the above provisions in the event this
corporation elects to become a close corporation, an agreement between two or
more Shareholders thereof, if in writing and signed by the parties thereof,
may provide that in exercising any voting rights the shares held by them shall
be voted as provided therein or in Sec. 706, and may otherwise modify these
provisions as to the Shareholders' meetings and actions.
ARTICLE IV
----------
CERTIFICATES AND TRANSFERS OF SHARES
------------------------------------
Section 1. Certificates for Shares.
------------------------
Certificates for shares shall be of such form and device as the
Board of Directors may designate and shall state the name of the record holder
of the shares represented thereby; its number; date of issuance; the number of
shares for which it is issued; a statement of the rights, privileges,
preferences and restrictions, if any; a statement as to the redemption or
conversion, if any; a statement of liens or restrictions upon transfer or
voting, if any; if the shares be assessable or, if assessments are collectible
by personal action, a plain statement of such facts.
Every certificate for shares must be signed by the President
or a Vice-President and the Secretary or an Assistant Secretary or must
be authenticated by facsimiles of the signatures of the President and
Secretary or by a facsimile of the signature of its President and the
written signature of its Secretary or
24
<PAGE>
an Assistant Secretary. Before it becomes effective every certificate for
shares authenticated by a facsimile of a signature must be countersigned by a
transfer agent or transfer clerk and must be registered by an incorporated
bank or trust company, either domestic or foreign, as registrar of transfers.
Section 2. Transfer on the Books.
----------------------
Upon surrender to the Secretary or transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
Section 3. Lost or Destroyed Certificates.
-------------------------------
Any person claiming a certificate of stock to be lost or
destroyed shall make an affidavit or affirmation of that fact and shall if the
Directors so require give the corporation a bond of indemnity, in form and
with one or more sureties satisfactory to the Board, in at least double the
value of the stock represented by said certificate, whereupon a new
certificate may be issued in the same tenor and for the same number of shares
as the one alleged to be lost or destroyed.
Section 4. Transfer Agents and Registrars.
-------------------------------
The Board of Directors may appoint one or more transfer agents
or transfer clerks, and one or more registrars, which shall be an incorporated
bank or trust company - - either domestic or foreign, who shall be appointed
at such times and places as the requirements of the corporation may
necessitate and the Board of Directors may designate.
Section 5. Closing Stock Transfer Books - Record Date.
-------------------------------------------
In order that the corporation may determine the Shareholders
entitled to notice of any meeting or to vote or entitled to receive payment of
any dividend or other distribution or allotment of any rights or entitled to
exercise any rights in respect of any other lawful action, the Board may fix,
in advance, a record date, which shall not be more than sixty nor less than
ten days prior to the date of such meeting nor more than sixty days prior to
any other action.
In no record date is fixed:
The record date for determining Shareholders entitled to notice
of or to vote at a meeting of Shareholders shall be at the close of business
on the business day next preceding the day on which notice is given or, if
notice is waived, at the close of business on the business day next preceding
the day on which the meeting is held.
The record date for determining Shareholders entitled to give
consent to corporate action in writing without a meeting, when no prior action
by the Board is necessary, shall be the day on which the first written consent
is given.
25
<PAGE>
The record date for determining Shareholders for any other
purpose shall be at the close of business on the day on which the Board adopts
the resolution relating thereto, or the 60th day prior to the date of such
other action, whichever is later.
Section 6. Legend Condition.
-----------------
In the event any shares of this corporation are issued pursuant
to a permit or exemption therefrom requiring the imposition of a legend
condition the person or persons issuing or transferring said shares shall make
sure said legend appears on the certificate and on the stub relating thereto
in the stock record book and shall not be required to transfer any shares free
of such legend unless an amendment to such permit or a new permit be first
issued so authorizing such a deletion.
Section 7. Close Corporation Certificates.
-------------------------------
All certificates representing shares of this corporation, in
the event it shall elect to become a close corporation, shall contain the
legend required by Sec. 418 c.
ARTICLE V
---------
CORPORATE RECORDS AND REPORTS - - INSPECTION
--------------------------------------------
Section 1. Records.
--------
The corporation shall maintain , in accordance with generally
accepted accounting principles, adequate and correct accounts, books and
records of its business and properties. All of such books, records and
accounts shall be kept at its principle executive office in the State of
California, as fixed by the Board of Directors from time to time.
Section 2. Inspection of Books and Records.
--------------------------------
All books and records provided for in Sec. 1500 shall be open
to inspection of the Directors and Shareholders from time to time and in the
manner provided in said Sec. 1600-1602.
Section 3. Certification and Inspection of By-Laws.
----------------------------------------
The original or a copy of these By-Laws, as amended or
otherwise altered to date, certified by the Secretary, shall be kept at the
corporation's principal executive office and shall be open to inspection by
the Shareholders of the company, at all reasonable times during office hours,
as provided in Sec. 213 of the Corporation Code.
Section 4. Checks, Drafts, Etc.
--------------------
All checks, drafts or other orders for payment of money, notes
or other evidence of indebtedness, issued in the name of or payable to the
corporation, shall be signed or endorsed by such person or persons and in such
manner as shall be determined from time to time by resolution of the Board of
Directors.
26
<PAGE>
Section 5. Contracts, Etc. - How Executed.
-------------------------------
The Board of Directors, except as in the By-Laws otherwise
provided, may authorize any Officer or Officers, agent or agents, to enter
into any contract or execute any instrument in the name of and on behalf of
the corporation. Such authority may be general or confined to specific
instances. Unless so authorized by the Board of Directors, no Officer, agent
or employee shall have any power or authority to bind the corporation by any
contract or agreement, or to pledge its credit, or to render it liable for any
purpose or to any amount, except as provided in Sec. 313 of the Corporations
Code.
ARTICLE VI
----------
ANNUAL REPORTS
--------------
Section 1. Due Date, Contents.
-------------------
The Board of Directors shall cause an annual report or
statement to be sent to the Shareholders of this corporation not later than
120 days after the close of the fiscal or calendar year in accordance with the
provisions of Secs. 1500 - 1501. Such report shall be sent to Shareholders at
least fifteen days prior to the annual meeting of Shareholders. Such report
shall contain a balance sheet as of the end of the fiscal year, an income
statement and a statement of changes in financial position for such fiscal
year, accompanied by any report thereon of an independent accountant, or if
there is no such report, a certificate of the Chief Financial Officer or
President that such statements were prepared without audit from the books and
records of the corporation.
Section 2. Waiver.
-------
The foregoing requirement of an annual report may be waived by
the Board so long as this corporation shall have less than 100 Shareholders.
ARTICLE VII
-----------
AMENDMENTS TO BY-LAWS
---------------------
Section 1. By Shareholders.
----------------
New By-Laws may be adopted or these By-Laws may be repealed or
amended at their annual meeting, or at any other meeting of the Shareholders
called for that purpose, by a vote of Shareholders entitled to exercise a
majority of the voting power of the corporation, or by written assent of such
Shareholders.
Section 2. Powers of Directors.
--------------------
Subject to the right of the Shareholders to adopt, amend or
repeal By-Laws, as provided in Section 1 of this Article VII, and the
limitations of Sec 204 (a) (5) and Sec. 212, the Board of Directors may adopt,
amend or repeal any of these By-Laws other than a By-Law or amendment thereof
changing the authorized number of Directors.
27
<PAGE>
Section 3. Record of Amendments.
---------------------
Whenever an amendment or new By-Law is adopted, it shall be
copied in the book of By-Laws with the original By-Laws, in the appropriate
place. If any By-Law is repealed, the fact of repeal with the date of the
meeting at which the repeal was enacted or written assent was filed shall be
stated in said book.
ARTICLE VIII
------------
MISCELLANEOUS
-------------
Section 1. References to Code Sections.
----------------------------
"Sec." references herein refer to the equivalent Sections of the
General Corporation Law effective January 1,1977 as amended.
Section 2. Effect of Shareholders' Agreement.
----------------------------------
Any Shareholders' Agreement authorized by Sec. 300 (b), shall
only be effective to modify the terms of these By-Laws if this corporation
elects to become a close corporation with appropriate filing of or amendment
to its Articles as required by Sec. 202 and shall terminate when this
corporation ceases to be a close corporation. Such an agreement cannot waive
or alter Secs. 158, (defining close corporations), 202 (requirements of
Articles of Incorporation), 500 and 501 relative to distribution, 111
(merger), 1201(e) (reorganization) or Chapters 15 (Records and Reports), 16
(Rights of Inspection), 18 (Involuntary Dissolution) or 22 (Crimes and
Penalties). Any other provisions of the Code or these By-Laws may be altered
or waived thereby, but to the extent they are not so altered or waived, these
By-Laws shall be applicable.
Section 3. Representation of Shares in Other Corporations.
-----------------------------------------------
Except as provided in Sec. 703, shares of other corporations
standing in the name of this corporation may be voted or represented and all
incidents thereto may be exercised on be-half of the corporation by the
Chairman of the Board, the President or any Vice President and the Secretary
or an Assistant Secretary.
Section 4. Subsidiary Corporations.
------------------------
Shares of this corporation owned by a subsidiary shall not be
entitled to vote on any matter. A subsidiary for these purposes is defined in
Sec. 189 (a) and (b).
Section 5. Indemnity.
----------
The corporation may indemnify any Director, Officer, agent or
employee as to those liabilities and on those terms and conditions as are
specified in Sec. 317. In any event, the corporation shall have the right to
purchase and maintain insurance on behalf of any such persons whether or not
the corporation would have the power to indemnify such person against the
liability insured against.
28
<PAGE>
CERTIFICATE OF ADOPTION OF BY-LAWS
Adoption by Incorporator(s) or First Director(s).
- -------------------------------------------------
The undersigned person(s) appointed in the Articles of
Incorporation to act as the Incorporator(s) or First Director(s) of the above
named corporation hereby adopt the same as the By-Laws of said corporation.
Executed this 9th day of July, 1980.
/S/ Chan Desaigoudar
------------------------
Name Chan Desaigoudar
Certificate by Secretary.
- -------------------------
I DO HEREBY CERTIFY AS FOLLOWS:
That I am the duly elected, qualified and acting Secretary of
the above named corporation; That the foregoing By-Laws were adopted as the
By-Laws of said corporation in the date set forth above by the person(s)
appointed in the Articles of Incorporation to act as the Incorporator(s) or
First Director(s) of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
corporate seal this 9th day of July, 1980
/S/ Paul I. Myers, Jr.
---------------------------------
Secretary Paul I. Myers, Jr.
Certificate by Secretary of Adoption by Shareholders' Vote.
- -----------------------------------------------------------
THIS IS TO CERTIFY:
That I am the duly elected, qualified and acting Secretary of
the above named corporation and that the above and foregoing Code of By-Laws
was submitted to the shareholders at their first meeting held on the date set
forth in the By-Laws and recorded in the minutes thereof, was ratified by the
vote of shareholders entitled to exercise the majority of the voting power of
said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand this _____day
of _______________________, 19____.
______________________________
Secretary
29
<PAGE>
MEMORANDUM OF
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California corporation
Effective: July 21, 1986
Pursuant to resolution adopted by the corporation's Board of
Directors on July 21, 1986, the Bylaws of the corporation are amended to read
as following:
The authorized number of Directors of the corporation
shall be at least five, and no more than nine.
This number may be changed by amendment to the Articles
of Incorporation or by an amendment to this Section 2,
Article I, of these Bylaws, adopted by the vote or written
assent of the shareholders entitled to exercise majority
voting power as provided in S212.
30
<PAGE>
MEMORANDUM OF
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California corporation
Effective: October 10, 1986
Pursuant to resolution adopted by the corporation's Board of
Directors on October 10, 1986, Article I of the Bylaws of the corporation are
amended to add the following:
Section 2.a. Exact Number of Directors.
-----------------------------------------
The exact number of directors of this
corporation, within the range authorized
elsewhere in these bylaws, shall be as
determined by the Board of Directors.
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MEMORANDUM OF
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California Corporation
Effective: January 13, 1987
Pursuant to resolution adopted by the corporation's Board of
Directors on January 13, 1987, the Bylaws of the Corporation are amended to
include the following provision:
Indemnification
The corporation has the power to indemnify any
person who is or was a director, officer, employee,
or other agent of this corporation or of its
predecessor, or is or was serving as such of
another corporation, partnership, joint venture,
trust, or other enterprise, at the request of this
corporation against expenses, judgments, fines,
settlements, and other amounts actually and
reasonably incurred in connection with any
threatened, pending, or completed action or
proceeding, whether civil, criminal, administrative,
or investigative, as provided in Section 317 of
the California Corporation Code, as that section now
exists or may hereafter from time to time be amended
to provide.
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MEMORANDUM OF
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California corporation
Effective: April 22, 1987
Pursuant to resolution adopted by the corporation's Board of
Directors on April 22, 1987, Article III, Section 2 of the Bylaws of the
corporation are amended to read as following:
Section 2. Annual Meetings.
-------------------------------
The annual meeting of the shareholders shall
be held, each year, within one hundred twenty (120)
days of the close of the corporation's last fiscal
year. The date and time of each annual meeting shall
be selected by the corporation's Board of Directors,
and notice thereof given in the manner prescribed in
Section 4 of Article III of these Bylaws.
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MEMORANDUM
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California corporation
Effective: July 25, 1987
Pursuant to resolution adopted by the corporation's Board of
Directors on July 25, 1987, Article III, Section 2 of the Bylaws of the
corporation are amended to read as following:
Section 2. Annual Meetings.
----------------
The annual meeting of the shareholders shall
be held, each year, no later than 150 days after
the end of the company's fiscal year upon a date
and at a time as selected by the Board of Directors,
and notice thereof given in the manner prescribed
in Section 4 of Article III of these Bylaws.
At the annual meeting, the shareholders shall
elect a Board of Directors, consider reports of the
affairs of the corporation, and transact such other
business as may be properly brought before the meeting.
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MEMORANDUM OF
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California corporation
Effective July 14, 1995
Pursuant to resolution adopted by the corporation's Board of
Directors on July 14, 1995, Article III, Section 4 of the Bylaws of the
corporation are amended to include the following provision:
Section 4. Notice of Meetings - Reports.
-----------------------------
The Company's Secretary must receive written
notice of the intent of a shareholder to nominate
a person not named in the Proxy Statement for the
position director not less than thirty (30) days
before the date of the Annual Meeting. Notices of
intent to nominate must include a statement from
the intended nominee indicating their willingness
to serve if elected and disclosing their principal
occupations or employment during the last five (5)
years. Nominations for directors not named in the
Proxy Statement at the Annual Meeting are made
without compliance with this section will be ruled
out of order at the Annual Meeting.
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MEMORANDUM OF
AMENDMENT TO BYLAWS
OF
CALIFORNIA MICRO DEVICES CORPORATION
a California corporation
Effective July 18, 1997
Pursuant to resolution adopted by the shareholders on July 18,
1997, Article III, Section 9 of the Bylaws of the corporation are amended to
read as follows:
Section 9. Voting Rights; Cumulative Voting.
---------------------------------
The election of directors by the shareholders
shall not be by cumulative voting. At each election
of directors, each shareholder entitled to vote may
vote all the shares held by that shareholder for each
of the several nominees for director up to the number
of directors to be elected. The shareholder may not
cast more votes for any single nominee than the number
of shares held by that shareholder. This paragraph
shall remain effective so long as the corporation is
a "listed corporation" within the meaning of Section
301.5(d) of the California General Corporation Law.
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EXHIBIT 10.03
CALIFORNIA MICRO DEVICES CORPORATION
1995 STOCK OPTION PLAN
-----------------------
AMENDED AS OF JULY 26, 1996, AMENDED AS OF JULY 18, 1997
--------------------------------------------------------
1. PURPOSE.
--------
The purpose of the CALIFORNIA MICRO DEVICES CORPORATION 1995 Stock Option
Plan (the "Plan") is to advance the interests of the Corporation and its
shareholders by providing a means by which the Corporation and its
Subsidiaries shall be able to attract and retain qualified employees and
consultants.
2. DEFINITIONS.
------------
(a) "Affiliate" shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations that includes the
Corporation if each of such corporations, other than the last corporation in
the chain, owns at least 50% of the total voting power of one of the other
corporations.
(b) "Affiliated Group" shall mean an affiliated group of
corporations, as defined in Code Section 1504, which includes the Corporation.
(c) "Board" shall mean the Board of Directors of the Corporation.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(e) "Committee" shall mean the committee appointed by the Board, in
accordance with Section 3(a) hereof, to administer the Plan.
(f) "Common Stock" shall mean the voting common stock of the
Corporation.
(g) "Consultant" shall mean any person who, or any employee of any firm
which, is engaged by the Company or any Affiliate to render consulting
services.
(h) "Corporation" shall mean CALIFORNIA MICRO DEVICES CORPORATION, a
California corporation.
(i) "Effective Date" shall mean February 10, 1995.
(j) "Employee" shall mean any individual who is employed, within the
meaning of Section 3401 of the Code and the regulations thereunder, by the
Corporation or by any Affiliate. For purposes of the Plan and only for
purposes of the Plan, and in regard to Nonstatutory Stock Options but not for
Incentive Stock Options, a Consultant of the Corporation or any Affiliate
shall be deemed to be an Employee, and service as a Consultant with the
Corporation or any Affiliate shall be deemed to be employment, but no
Incentive Stock Option shall be granted to a Consultant who is not an employee
of the Corporation or any Affiliate within the meaning of Section 3401 of the
Code and the regulations thereunder. In the case of a Consultant, the
provisions governing when a termination of employment has occurred for
purposes of the Plan shall be set forth in the written stock option agreement
between the Optionee and the corporation, or, if not so set forth, the
Committee shall have the discretion to determine when a termination of
"employment" has occurred for purposes of the Plan.
(k) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
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(l) "Exercise Price" shall mean the price per Share at which an Option
may be exercised, as determined by the Committee and as specified in the
Optionee's stock option agreement.
(m) "Fair Market Value" shall mean the value of one Share of Common
Stock, determined as follows: (i) if the Shares are traded on an exchange or
on the NASDAQ National Market System, the reported "closing price" on the date
of valuation or if no trading occurred on such date, the next preceding day on
which trading occurred; (ii) if the Shares are traded over-the-counter on the
NASDAQ System (other than on the NASDAQ National Market System), the mean
between the bid and the ask prices on said System at the close of business on
the date of valuation or if no trading occurred on such date, the next
preceding day on which trading occurred; and (iii) if neither (i) nor (ii)
applies, the fair market value as determined by the Committee in good faith.
Such determination shall be conclusive and binding on all persons.
(n) "Incentive Stock Option" shall mean an Option of the type described
in Section 422(b) of the Code.
(o) "Nonstatutory Stock Option" shall mean an Option of the type not
described in Section 422(b) or 423(b) of the Code.
(p) "Option" shall mean an option to purchase Common Stock granted
pursuant to the Plan.
(q) "Optionee" shall mean any person who holds an Option pursuant to
the Plan.
(r) "Outside Director" shall mean a member of the Board who (1) is not
a current employee of any member of the Affiliated Group; (2) does not receive
compensation for prior services (other than benefits under a tax-qualified
retirement plan) from any member of the Affiliated Group during a taxable year
in which he or she serves on the Committee; (3) has never been an officer of
any member of the Affiliated Group; and (4) does not receive remuneration from
any member of the Affiliated Group, either directly or indirectly, in any
capacity other than as a director.
(s) "Plan" shall mean this stock option plan as it may be amended from
time to time.
(t) "Purchase Price" shall mean at any particular time the Exercise
Price times the number of Shares for which an Option is being exercised.
(u) "Share" shall mean one share of authorized Common Stock.
3. ADMINISTRATION.
---------------
(a) The Committee.
--------------
The Plan shall be administered by a Committee of Outside Directors
which shall consist of not less than two members, who during the one year
prior to service as an administrator of the Plan, shall not have been granted
or awarded equity securities pursuant to the Plan or any other plan of the
Corporation or any of its Affiliates except as permitted under Rule 16b-3
under the Exchange Act. The Board may from time to time designate individuals
as ineligible to participate in the Plan for a specified period in order to
become eligible to be a member of the Committee.
(b) Powers of the Committee.
------------------------
Subject to the provisions of the Plan, the Committee shall have the
authority, in its discretion and on behalf of the Corporation:
(i) to grant Options;
(ii) to determine the Exercise Price per Share of Options to be
granted;
(iii) to determine the Employees to whom, and the time or times at
which, Options shall be
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<PAGE>
granted and the number of Shares for which an Option will be exercisable;
(iv) to interpret the Plan;
(v) to prescribe, amend, and rescind rules and regulations
relating to the Plan;
(vi) to determine the terms and provisions of each Option granted
and, with the consent of the holder thereof, modify or amend each Option;
(vii) to accelerate or defer, with the consent of the Optionee,
the exercise date of any Option;
(viii) to authorize any person to execute on behalf of the
Corporation any instrument required to effectuate the grant of an Option
previously granted by the Committee;
(ix) with the consent of the Optionee, to reprice, cancel and
regrant, or otherwise adjust the Exercise Price of an Option previously
granted by the Committee; and
(x) to make all other determinations deemed necessary or
advisable for the administration of the Plan.
(c) Board's Determination of Fair Market Value.
-------------------------------------------
The Board shall have the authority to determine, upon review of
relevant information, the Fair Market Value of the Common Stock, subject to
the provisions of the Plan and irrespective of whether the Board has appointed
a Committee to administer the Plan. The Board may delegate this authority to
the Committee.
d) Committee's Interpretation of the Plan.
---------------------------------------
The interpretation and construction by the Committee of any
provision of the Plan or of any Option granted hereunder shall be final and
binding on all parties claiming an interest in an Option granted under the
Plan. No member of the Committee shall be liable for any action or
determination made in good faith with respect to the Plan or any Option.
4. PARTICIPATION.
--------------
(a) Eligibility.
------------
The Optionees shall be such persons as the Committee may select
from among the Employees, provided that Consultants are not eligible to
receive Incentive Stock Options. Notwithstanding anything to the contrary set
forth herein, members of the Board are not eligible for grants of Options.
(b) Ten Percent Shareholders.
-------------------------
Any Employee who owns Stock possessing more than 10% of the total
combined voting power of all classes of outstanding stock of the Corporation
or any Affiliate shall not be eligible to receive an Option unless:
(i) the Exercise Price of the Shares subject to such Option when
granted is at least 110% of the Fair Market Value of such Shares, and
(ii) such Option by its terms is not exercisable after the
expiration of five years from the date of grant.
(c) Stock Ownership.
----------------
For purposes of Paragraph 4(b), in determining stock ownership, an
Employee shall be considered as owning the stock owned, directly or
indirectly, by or for his or her brothers and sisters, spouse, ancestors, and
lineal descendants. Stock owned, directly or indirectly, by or for a
corporation, partnership,
39
<PAGE>
estate, or trust shall be considered as being owned
proportionately by or for its shareholders, partners, or beneficiaries,
respectively. Stock with respect to which such Employee or any other person
holds an option shall be disregarded.
(d) Outstanding Stock.
------------------
For purposes of Section 4(b), the term "outstanding stock" shall
include all stock actually issued and outstanding immediately after the grant
of the Option to the Optionee but shall not include any share for which an
Option is exercisable by any person.
5. STOCK.
------
(a) Shares Subject to This Plan.
----------------------------
The aggregate number of Shares which may be issued upon exercise of
Options under the Plan shall not exceed Two million Three Hundred Seventy
Thousand (2,370,000), subject to adjustment pursuant to Section 9 hereof.
(b) Options Not to Exceed Shares Available.
---------------------------------------
The number of Shares for which an Option is exercisable at any time
shall not exceed the number of Shares remaining available for issuance under
the Plan. If any Option expires or is terminated, the number of Shares for
which such Option was exercisable may be made exercisable pursuant to other
Options under the Plan. The limitations established by this Section 5(b)
shall be subject to adjustment in the manner provided in Section 9 hereof upon
the occurrence of an event specified therein.
(c) Limitation on Grants.
---------------------
No person shall be granted in any one fiscal year options for more
than 500,000 Shares.
6. TERMS AND CONDITIONS OF OPTIONS.
--------------------------------
(a) Stock Option Agreements.
------------------------
Options shall be evidenced by written stock option agreements
between the Optionee and the Corporation in such form as the Committee shall
from time to time determine. No Option or purported Option shall be a valid
and binding obligation of the Corporation unless so evidenced in writing.
(b) Number of Shares.
-----------------
Each stock option agreement shall state the number of Shares for
which the Option is exercisable and shall provide for the adjustment thereof
in accordance with Section 9 hereof.
(c) Vesting.
--------
An Optionee may not exercise his or her Option for any Shares until
the Option, in regard to such Shares, has vested. Each stock option agreement
shall include a vesting schedule which shall show when the Option becomes
exercisable. The vesting schedule shall not impose upon the Corporation or
any Affiliate any obligation to retain the Optionee in its employ or under
contract for any period or otherwise change the employment-at-will status of
an Optionee who is an employee of the Corporation or any Affiliate.
(d) Lapse of Options.
-----------------
Each stock option agreement shall state the time or times when the
Option covered thereby lapses and becomes unexercisable in part or in full.
An Option shall lapse on the earliest of the following events (unless
otherwise determined by the Committee and reflected in an option agreement):
(i) The tenth anniversary of the date of granting the Option;
(ii) The first anniversary of the Optionee's death;
(iii) The first anniversary of the date the Optionee ceases to be
an Employee due to total and permanent disability, within the meaning of
Section 22(e)(3) of the Code;
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<PAGE>
(iv) On the date provided in Section 6(h)(i), unless with respect
to a Nonstatutory Stock Option, the Committee otherwise extends such period
before the applicable expiration date;
(v) On the date provided in Section 9 for a transaction described
in such Section;
(vi) The date the Optionee files or has filed against him or her a
petition in bankruptcy; or
(vii) The expiration date specified in an Optionee's stock option
agreement.
(e) Exercise Price.
---------------
Each stock option agreement shall state the Exercise Price for the
Shares for which the Option is exercisable. Subject to Section 4(b), the
Exercise Price of an Incentive Stock Option and a Nonstatutory Stock Option
shall, when granted, be not less than 100% and 85% of the Fair Market Value of
the Shares for which the Option is exercisable, respectively, and not less
than the par value of the Shares.
(f) Medium and Time of Payment.
---------------------------
The Purchase Price shall be payable in full in cash upon the
exercise of an Option but the Committee may allow the Optionee to pay the
Purchase Price:
(i) by surrendering Shares in good form for transfer, owned by
the Optionee and having a Fair Market Value on the date of exercise equal to
the Purchase Price;
(ii) by delivery of a full recourse promissory note ("Note") made
by the Optionee in the amount of the Purchase Price, bearing interest,
compounded semiannually, at a rate not less than the rate determined under
Section 7872 of the Code to insure that no "foregone interest", as defined in
such section, will accrue, together with the delivery of a duly executed
standard form security agreement securing the Note by a pledge of the Shares
purchased; or
(iii) in any combination of such consideration or such other
consideration and method of payment for the issuance of Shares to the extent
permitted under applicable law Code as long as the sum of the cash so paid,
the Fair Market Value of the Shares so surrendered, and the amount of any Note
equals the Purchase Price.
The Committee or a stock option agreement may prescribe requirements
with respect to the exercise of Options, including the submission by the
Optionee of such forms and documents as the Committee may require and, the
delivery by the Optionee of cash sufficient to satisfy applicable withholding
requirements. The Committee may vary the exercise requirements and procedures
from time to time to facilitate, for example, the broker-assisted exercise of
Options.
(g) Nontransferability of Options.
------------------------------
During the lifetime of the Optionee, the Option shall be
exercisable only by the Optionee or the Optionee's conservator or legal
representative and shall not be assignable or transferable except pursuant to
a qualified domestic relations order as defined by the Code. In the event of
the Optionee's death, the Option shall not be transferable by the Optionee
other than by will or the laws of descent and distribution.
(h) Termination of Employment Other than by Death or Disability.
(i) If an Optionee ceases to be an Employee for any reason other
than his or her death or disability, the Optionee shall have the right,
subject to the provisions of this Section 6, to exercise any Option held by
the Optionee at any time within ninety (90) days after his or her termination
of employment, but not beyond the otherwise applicable term of the Option and
only to the extent that on such date of termination of employment the
Optionee's right to exercise such Option had vested.
(ii) For purposes of this Section 6(h), the employment
relationship shall be treated as continuing intact while the Optionee is an
active employee of the Corporation or any Affiliate, or is on military
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<PAGE>
leave, sick leave, or other bona fide leave of absence to be determined in the
sole discretion of the Committee. The preceding sentence notwithstanding, in
the case of an Incentive Stock Option, employment shall be deemed to terminate
on the date the Optionee ceases active employment with the Corporation or any
Affiliate, unless the Optionee's reemployment rights are guaranteed by statute
or contract.
(i) Death of Optionee.
------------------
If an Optionee dies while an Employee, or after ceasing to be an
Employee but during the period while he or she could have exercised an Option
under Section 6(h), any Option granted to the Optionee may be exercised, to
the extent it had vested at the time of death and subject to the Plan, at any
time within 12 months after the Optionee's death, by the executors or
administrators of his or her estate or by any person or persons who acquire
the Option by will or the laws of descent and distribution, but not beyond the
otherwise applicable term of the Option.
(j) Disability of Optionee.
-----------------------
If an Optionee ceases to be an Employee due to becoming totally and
permanently disabled within the meaning of Section 22(e)(3) of the Code, any
Option granted to the Optionee may be exercised to the extent it had vested at
the time of cessation and, subject to the Plan, at any time within 12 months
after the Optionee's termination of employment, but not beyond the otherwise
applicable term of the Option.
(k) Rights as a Shareholder.
------------------------
An Optionee, or a transferee of an Optionee, shall have no rights
as a shareholder of the Corporation with respect to any Shares for which his
or her Option is exercisable until the date of the issuance of a stock
certificate for such Shares. No adjustment shall be made for dividends,
ordinary or extraordinary or whether in currency, securities, or other
property, distributions, or other rights for which the record date is prior to
the date such stock certificate is issued, except as provided in Section 9
hereof.
(l) Modification, Extension, and Renewal of Options.
------------------------------------------------
Within the limitations of the Plan, the Committee may modify,
extend or renew outstanding Options or accept the cancellation of outstanding
Options for the granting of new Options in substitution therefor.
Notwithstanding the preceding sentence, no modification of an Option shall,
without the consent of the Optionee, alter or impair any rights or obligations
under any Option previously granted.
(m) Other Provisions.
-----------------
The stock option agreements authorized under the Plan may contain
such other provisions which are not inconsistent with the terms of the Plan,
including, without limitation, restrictions upon the exercise of the Option,
as the Committee shall deem advisable.
7. $100,000 PER YEAR LIMITATION ON VESTING OF ISOs.
------------------------------------------------
To the extent that the Fair Market Value of Shares (determined for each
Share as of the date of grant of the Option covering such Share) subject to
Options granted under this Plan (or any other plan of the Corporation or any
Affiliate) which are designated as Incentive Stock Options and which become
exercisable by an Optionee for the first time during a single calendar year
exceeds $100,000, the Option(s) (or portion thereof) covering such Shares
shall be recharacterized (to the extent of such excess over $100,000) as a
Nonstatutory Stock Option. In determining which Option(s) shall be treated as
Nonstatutory Stock Options under the preceding sentence, the Options shall be
taken into account in the order granted, with the result that a later granted
Option shall be recharacterized as a Nonstatutory Stock Option prior to such
recharacterization of a previously granted Option.
8. TERM OF PLAN.
-------------
Options may be granted pursuant to the Plan until ten years following
the Effective Date, and all Options which are outstanding on such date shall
remain in effect until they are exercised or expire by their terms. The Plan
shall expire for all purposes on the date 20 years following the Effective
Date.
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9. RECAPITALIZATION, TAKEOVERS, AND LIQUIDATIONS.
----------------------------------------------
(a) Reorganizations.
----------------
The number of Shares covered by the Plan, as provided in Section 5
hereof, and the number of Shares for which each Option is exercisable shall be
proportionately adjusted for any increase or decrease in the number of issued
Shares resulting from the payment of a Common Stock dividend, a stock split, a
reverse stock split or any other event which results in an increase or
decrease in the number of issued Shares effected without receipt of
consideration by the Corporation, and the Exercise Price shall be
proportionately increased in the event the number of Shares subject to such
Option are decreased and shall be proportionately decreased in the event the
number of Shares subject to such Option are increased. For the purposes of
this paragraph, conversion of any convertible securities of the Corporation
shall not be deemed to have been "effected without receipt of consideration."
Adjustments 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 Corporation 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) Liquidation.
------------
In the event of the dissolution or liquidation of the Corporation,
each Option shall terminate immediately prior to the consummation of such
action. The Committee shall notify the Optionee not less than fifteen (15)
days prior to the proposed consummation of a pending dissolution or
liquidation, and the Option shall be exercisable as to all Shares which are
vested prior to expiration until immediately prior to the consummation of such
action.
(c) Merger.
-------
In the event of a merger or acquisition involving an acquisition of
the Corporation or an acquisition by the Corporation of another company, the
result of which is that the outstanding voting securities of the Corporation
do not represent, or are not converted into, a majority of the outstanding
voting securities of the surviving corporation, except as otherwise provided
in any particular Option agreement, the vesting of all unvested Options shall
be accelerated and all options shall be immediately exercisable. Without
limiting the generality of the foregoing, in the event of (i) a proposed
merger of the Corporation with or into another corporation, as a result of
which the Corporation is not the surviving corporation and (ii) the Option is
not assumed or an equivalent option substituted by the successor corporation
or a parent or subsidiary of the successor corporation, then in such case each
Option shall terminate immediately prior to the consummation of such
transaction. The Committee shall notify the Optionee not less than fifteen
(15) days prior to the proposed consummation of such transaction, and the
Option shall be exercisable as to all Shares which are subject to the Option
until immediately prior to the consummation of such transaction.
(d) Determination by Committee.
----------------------------
All adjustments described in this Section 9 shall be made by the
Committee, whose determination shall be conclusive and binding on all persons.
(e) Limitation on Rights of Optionee.
--------------------------------
Except as expressly provided in this Section 9, no Optionee shall
have any rights by reason of any payment of any stock dividend, stock split or
reverse stock split or any other increase or decrease in the number of shares
of stock of any class, or by reason of any reorganization, consolidation,
dissolution, liquidation, merger, exchange, split-up or reverse split-up, or
spin-off of assets or stock of another corporation. Any issuance by the
Corporation of Shares, Options or securities convertible into Shares or
Options shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or Exercise Price of the Shares for which an
Option is exercisable. Notwithstanding the foregoing, if the Corporation
shall enter into a transaction affecting the Corporation's capital stock or
distributions to the holders of its capital stock for which a revision in the
terms of each Option is not required pursuant to this Section 9, the Committee
shall have the right, but not the obligation, to revise the terms of each
Option in a manner the Committee, in its sole discretion, deems fair and
reasonable given the transaction involved. If necessary or appropriate in
connection with such transaction, the Committee may declare that any Option
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shall terminate as of a date fixed by the Committee and give each Optionee the
right to exercise his Option in whole or in part, including exercise as to
Shares to which the Option would not otherwise be exercisable.
(f) No Restriction on Rights of Corporation.
---------------------------------------
The grant of an Option shall not affect or restrict in any way the
right or power of the Corporation to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure, or to merge
or consolidate, or to dissolve, liquidate, sell, or transfer all or any part
of its business or assets.
10. SECURITIES LAW REQUIREMENTS.
----------------------------
The Corporation shall not be under any obligation to issue any Shares
upon the exercise of any Option unless and until the Corporation has
determined that: (i) it and the Optionee have taken all actions required to
register the Shares under the Securities Act of 1933, or to perfect an
exemption from the registration requirements thereof; (ii) any applicable
listing requirement of any stock exchange on which the Common Stock is listed
has been satisfied; and (iii) all other applicable provisions of state and
Federal law have been satisfied.
11. EXERCISE OF UNVESTED OPTIONS.
-----------------------------
The Committee may grant any Optionee the right to exercise any Option
prior to the complete vesting of such Option. Without limiting the generality
of the foregoing, the Committee may provide that if an Option is exercised
prior to having completely vested, the Shares issued upon such exercise shall
remain subject to vesting at the same rate as under the Option so exercised
and shall be subject to a right, but not an obligation, of repurchase by the
Corporation with respect to all unvested Shares if the Optionee ceases to be
an Employee for any reason. For the purposes of facilitating the enforcement
of any such right of repurchase, at the request of the Committee, the Optionee
shall enter into the Joint Escrow Instructions with the Corporation and
deliver every certificate for his or her unvested Shares with a stock power
executed in blank by the Optionee and by the Optionee's spouse, if required
for transfer.
12. AMENDMENT OF THE PLAN.
----------------------
The Board or the Committee may, from time to time, terminate, suspend or
discontinue the Plan, in whole or in part, or revise or amend it in any
respect whatsoever including, but not limited to, the adoption of any
amendment(s) deemed necessary or advisable to qualify the Options under rules
and regulations promulgated by the Securities and Exchange Commission with
respect to Employees who are subject to the provisions of Section 16 of the
Securities Exchange Act of 1934, as amended, or to correct any defect or
supply any omission or reconcile any inconsistency in the Plan or in any
Option granted thereunder, without approval of the shareholders of the
Corporation, but without the approval of the Corporation's shareholders, no
such revision or amendment shall:
(i) Increase the number of Shares subject to the Plan, other than any
increase pursuant to Section 9;
(ii) Materially modify the requirements as to eligibility for
participation in the Plan;
(iii) Materially increase the benefits accruing to Optionees under the
Plan;
(iv) Extend the term of the Plan; or
(v) Amend this Section to defeat its purpose.
No amendment, termination or modification of the Plan shall affect any
Option theretofore granted in any material adverse way without the consent of
the Optionee.
44
<PAGE>
13. APPLICATION OF FUNDS.
---------------------
The proceeds received by the Corporation from the sale of Common Stock
pursuant to the exercise of an Option shall be used for general corporate
purposes.
14. APPROVAL OF SHAREHOLDERS.
------------------------
The Plan shall be subject to approval by the affirmative vote of the
holders of a majority of all classes of the outstanding shares present and
entitled to vote at the first meeting of shareholders of the Corporation
following the adoption of the Plan or by written consent, and in no event
later than one (1) year following the Effective Date. Prior to such approval,
Options may be granted but shall not be exercisable. Any amendment described
in Section 12 (i) to (iv) shall also be subject to approval by the
Corporation's shareholders.
15 WITHHOLDING OF TAXES.
---------------------
In the event the Corporation or a Affiliate determines that it is
required to withhold Federal, state, or local taxes in connection with the
exercise of an Option or the disposition of Shares issued pursuant to the
exercise of an Option, the Optionee or any person succeeding to the rights of
the Optionee, as a condition to such exercise or disposition, may be required
to make arrangements satisfactory to the Corporation or the Affiliate to
enable it to satisfy such withholding requirements.
16 RIGHTS AS AN EMPLOYEE.
----------------------
Neither the Plan nor any Option granted pursuant thereto shall be
construed to give any person the right to remain in the employ of the
Corporation or any Affiliate, or to affect the right of the Corporation or any
Affiliate to terminate such individual's employment at any time with or
without cause. The grant of an Option shall not entitle the Optionee to, or
disqualify the Optionee from, participation in the grant of any other Option
under the Plan or participation in any other benefit plan maintained by the
Corporation or any Affiliate.
17 DISAVOWAL OF REPRESENTATIONS, UNDERTAKINGS OR CREATION OF IMPLIED RIGHTS.
-------------------------------------------------------------------------
In adopting and maintaining this Plan and granting options hereunder,
neither the Corporation nor any Affiliate makes any representations or
undertakings with respect to the initial qualification or treatment of Options
under federal or state tax or securities laws. The Corporation and each
Affiliate expressly disavows the creation of any rights in Employees,
Optionees, or beneficiaries of any obligations on the part of the Corporation,
any Affiliate or the Committee, except as expressly provided herein.
18. INSPECTION OF RECORDS.
----------------------
Copies of the Plan, records reflecting each Optionee's Option, and any
other documents and records which an Optionee is entitled by law to inspect
shall be open to inspection by the Optionee and his or her duly authorized
representative at the office of the Committee at any reasonable business hour.
19. INFORMATION TO OPTIONEES.
-------------------------
Each Optionee shall be provided with such information regarding the
Corporation as the Committee from time to time deems necessary or appropriate;
provided however, that each Optionee shall at all times be provided with such
information as is required to be provided from time to time pursuant to
applicable regulatory requirements, including, but not limited to, any
applicable requirements of the Securities and Exchange Commission, the
California Department of Corporations and other state securities agencies.
45
<PAGE>
EXHIBIT 10.04
CALIFORNIA MICRO DEVICES CORPORATION
1995 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
----------------------------------------------
AMENDED AS OF JULY 26, 1996, AMENDED AS OF JULY 18, 1997
--------------------------------------------------------
1. PURPOSE.
--------
The purpose of the CALIFORNIA MICRO DEVICES CORPORATION Non-Employee
Directors' Stock Option Plan (the "Plan") is to secure for the Corporation and
its shareholders the benefits of the incentive inherent in increased common
stock ownership by the members of the Board of Directors (the "Board") of the
Corporation who are not employees of the Corporation or any of its
subsidiaries.
2. DEFINITIONS.
------------
(a) "Board" shall mean the board of directors of the Corporation.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Committee" shall mean the committee appointed by the Board to
administer the Plan, or if no such committee is appointed, by the Board.
(d) "Common Stock" shall mean the voting common stock, of the
Corporation.
(e) "Corporation" shall mean CALIFORNIA MICRO DEVICES CORPORATION, a
California corporation.
(f) "Director" shall mean a member of the Board.
(g) "Effective Date" shall mean February 10, 1995.
(h) "Exercise Price" shall mean the price per Share at which an Option
may be exercised, as determined by the Committee and as specified in the
Optionee's stock option agreement.
(i) "Fair Market Value" shall mean for any day the average of the
closing bid and asked prices of the Stock in the over-the-counter market, as
reported through the National Association of Securities Dealers ("NASD")
Automated Quotation System or, if the Stock is listed or admitted to trading
on the Nasdaq National Market System or any national securities exchange or if
the last reported sale price of such Stock is generally available, the last
reported sale price on such system or exchange. The Fair Market Value for any
day for which there is no such bid and asked or last reported sales price
shall be the Fair Market Value of the next preceding day for which there is
such a price.
(j) "Non-Employee Director" shall mean a Director who is not an
employee of the Corporation or any of its subsidiaries.
(k) "Option" shall mean an option to purchase Common Stock granted
pursuant to the Plan.
(l) "Optionee" shall mean any person who holds an Option pursuant to
the Plan.
(m) "Plan" shall mean the CALIFORNIA MICRO DEVICES CORPORATION 1995
Non-Employee Directors' Stock Option Plan, as it may be amended from time to
time.
46
<PAGE>
(n) "Purchase Price" shall mean at any particular time the Exercise
Price times the number of Shares for which an Option is being exercised.
(o) "Share" shall mean one share of authorized Common Stock.
3. ADMINISTRATION.
---------------
(a) The Committee.
--------------
The Plan shall be administered by a Committee which shall consist
of not less than three members of the Board.
(b) Powers of the Committee.
-----------------------
Subject to the provisions of the Plan, the Committee shall have the
authority, in its discretion and on behalf of the Corporation shall, subject
to the provisions of the Plan, grant Options and shall have the power to
construe the Plan, to determine all questions arising thereunder and to adopt
and amend such rules and regulations for the administration of the Plan as it
may deem desirable. Any decision of the Committee in the administration of
the Plan, as described herein, shall be final and conclusive. No member of
the Committee shall be liable for anything done or omitted to be done by such
member or by any other member of the Committee in connection with the Plan,
except for such member's own willful misconduct or as expressly provided by
statute.
4. PARTICIPATION.
--------------
Each Non-Employee Director shall be eligible to receive Options in
accordance with the Plan. The adoption of this Plan shall not be deemed to
give any director any right to be granted an option to purchase Common Stock
of the Corporation, except to the extent and upon such terms and conditions
are provided herein.
5. STOCK.
------
(a) Shares Subject to This Plan.
----------------------------
The aggregate number of Shares which may be issued upon exercise of
Options under the Plan shall not exceed Two Hundred and Twenty Thousand
(220,000) subject to adjustment pursuant to Section 8 hereof.
(b) Options Not to Exceed Shares Available.
---------------------------------------
The number of Shares for which an Option is exercisable at any time
shall not exceed the number of Shares remaining available for issuance under
the Plan. If any Option expires or is terminated, the number of Shares for
which such Option was exercisable may be made exercisable pursuant to other
Options under the Plan. The limitations established by this Section 5 shall
be subject to adjustment in the manner provided in Section 8 hereof upon the
occurrence of an event specified therein.
6. TERMS AND CONDITIONS OF OPTIONS.
--------------------------------
(a) Stock Option Agreements.
------------------------
Options shall be evidenced by written stock option agreements
between the Optionee and the Corporation in such form as the Committee shall
from time to time determine. No Option or purported Option shall be a valid
and binding obligation of the Corporation unless so evidenced in writing.
(b) Number of Shares.
-----------------
Each stock option agreement shall state the number of Shares for
which the Option is exercisable in accordance with the following and shall
provide for the adjustment thereof in accordance with Section 8 hereof.
47
<PAGE>
(i) Upon adoption of this Plan by the Board, and subject to the
approval of the Plan by the Shareholders of the Corporation in accordance with
Section 14 hereof, each Non-Employee Director then in office shall, without
further action required, be granted an Option for the purchase of Ten Thousand
(10,000) Shares. Each other person appointed or elected to serve as a Non-
Employee Director during the term of this Plan shall be granted an option for
Fifteen Thousand (15,000) Shares upon his or her appointment or election.
(ii) Subject to the approval of the Plan by the Shareholders of the
Corporation in accordance with Section 14 hereof, each year, as of the date of
the Annual Meeting of Shareholders of the Corporation, each Non-Employee
Director who has been elected or re-elected or who is continuing as a member
of the Board as of the adjournment of the Annual Meeting (other than any Non-
Employee Director eligible for a grant pursuant to paragraph (b)(i)) shall
automatically receive an Option for Ten Thousand (10,000) shares of Common
Stock.
(c) Vesting.
-------
An Optionee may not exercise his or her Option for any Shares until
the Non-Employee Director has served one year as a member of the Board since
the date the option was granted. An Optionee may exercise the Option as to
one fourth of the Shares at the end of the 4th full calendar quarter following
the date the Option was granted and as to an additional 1/16th of the Shares
at the end of each of the full calendar quarter commencing with the 5th full
calendar quarter following the date the Option was granted. The right to
exercise the Option shall be cumulative. An Optionee may buy all, or from
time to time any part, of the maximum number of shares which are exercisable
under the an Option, but in no case may Optionee exercise the Option with
regard to a fraction of a share, or for any share for which the Stock Option
is not exercisable.
(d) Lapse of Options.
-----------------
Each stock option agreement shall state the time or times when the
Option covered thereby lapses and becomes unexercisable in part or in full.
An Option shall lapse on the earliest of the following events (unless
otherwise determined by the Committee and reflected in an option agreement):
(i) The tenth anniversary of the date of granting the Option;
(ii) The first anniversary of the Optionee's death;
(iii) The first anniversary of the date the Optionee ceases to be a
Director due to total and permanent disability, within the meaning of Section
22(e)(3) of the Code;
(iv) Ninety (90) days after the Optionee ceases to be a Director
for any reason other than his or her death or total and permanent disability;
(v) The date the Optionee files or has filed against him or her a
petition in bankruptcy; or
(vi) The expiration date specified in an Optionee's stock option
agreement.
(e) Exercise Price.
---------------
Each stock option agreement shall state the Exercise Price for the
Shares for which the Option is exercisable. The Exercise Price of all Options
shall be the Fair Market Value of the Shares for which the Option is
exercisable, and not less than the par value of the Shares.
(f) Medium and Time of Payment.
---------------------------
The Purchase Price shall be payable in full in cash upon the
exercise of an Option but the Committee may allow the Optionee to pay the
Purchase Price:
(i) by surrendering Shares in good form for transfer, owned by
the Optionee and having a Fair Market Value on the date of exercise equal to
the Purchase Price;
48
<PAGE>
(ii) by delivery of a full recourse promissory note ("Note") made
by the Optionee in the amount of the Purchase Price, bearing interest,
compounded semiannually, at a rate not less than the rate determined under
Section 7872 of the Code to insure that no "unstated interest", as defined in
such section will accrue, together with the delivery of a duly executed
standard form security agreement securing the Note by a pledge of the Shares
purchased; or
(iii) in any combination of such consideration or such other
consideration and method of payment for the issuance of Shares to the extent
permitted under applicable law as long as the sum of the cash so paid, the
Fair Market Value of the Shares so surrendered, and the amount of any Note
equals the Purchase Price.
The Committee or a stock option agreement may prescribe requirements with
respect to the exercise of Options, including the submission by the Optionee
of such forms and documents as the Committee may require and the delivery by
the Optionee of cash sufficient to satisfy applicable withholding
requirements. The Committee may vary the exercise requirements and procedures
from time to time to facilitate, for example, the broker-assisted exercise of
Options.
(g) Nontransferability of Options.
------------------------------
During the lifetime of the Optionee, the Option shall be
exercisable only by the Optionee or the Optionee's conservator or legal
representative and shall not be assignable or transferable except pursuant to
a qualified domestic relations order as defined by the Code. In the event of
the Optionee's death, the Option shall not be transferable by the Optionee
other than by will or the laws of descent and distribution.
(h) Termination of Directorship Other than by Death or Disability.
--------------------------------------------------------------
If an Optionee ceases to be a Director for any reason other than
his or her death or disability, the Optionee shall have the right, subject to
the provisions of this Section 6, to exercise any Option held by the Optionee
at any time within ninety (90) days after his or her termination as a
Director, but not beyond the otherwise applicable term of the Option and only
to the extent that on such date of termination as a Director the Optionee's
right to exercise such Option had vested.
(i) Death of Optionee.
------------------
If an Optionee dies while a Director, or after ceasing to be a
Director but during the period while he or she could have exercised an Option
under Section 6(h) hereof, any Option granted to the Optionee may be
exercised, to the extent it had vested at the time of death and subject to the
Plan, at any time within twelve (12) months after the Optionee's death, by the
executors or administrators of his or her estate or by any person or persons
who acquire the Option by will or the laws of descent and distribution, but
not beyond the otherwise applicable term of the Option.
(j) Disability of Optionee.
-----------------------
If an Optionee ceases to be a Director due to becoming totally and
permanently disabled within the meaning of Section 22(e)(3) of the Code, any
Option granted to the Optionee may be exercised to the extent it had vested at
the time of cessation and, subject to the Plan, at any time within twelve (12)
months after the termination of Optionee's position as a Director, but not
beyond the otherwise applicable term of the Option.
(k) Rights as a Shareholder.
------------------------
An Optionee, or a transferee of an Optionee, shall have no rights
as a shareholder of the Corporation with respect to any Shares for which his
or her Option is exercisable until the date of the issuance of a stock
certificate for such Shares. No adjustment shall be made for dividends,
ordinary or extraordinary or whether in currency, securities, or other
property, distributions, or other rights for which the record date is prior to
the date such stock certificate is issued, except as provided in Section 8
hereof.
(l) Other Provisions.
-----------------
The stock option agreements authorized under the Plan may contain
such other provisions
49
<PAGE>
which are not inconsistent with the terms of the Plan, including, without
limitation, restrictions upon the exercise of the Option, as the Committee
shall deem advisable.
7. TERM OF PLAN.
-------------
Options may be granted pursuant to the Plan until ten (10) years
following the Effective Date, and all Options which are outstanding on such
date shall remain in effect until they are exercised or expire by their terms.
The Plan shall expire for all purposes on the date twenty (20) years following
the Effective Date.
8. REORGANIZATIONS.
----------------
(a) Reorganizations.
----------------
The number of Shares covered by the Plan, as provided in Section 5
hereof, and the number of Shares for which each Option is exercisable shall be
proportionately adjusted for any increase or decrease in the number of issued
Shares resulting from the payment of a Common Stock dividend, a stock split, a
reverse stock split or any other event which results in an increase or
decrease in the number of issued Shares effected without receipt of
consideration by the Corporation, and the Exercise Price shall be
proportionately increased in the event the number of Shares subject to such
Option are decreased and shall be proportionately decreased in the event the
number of Shares subject to such Option are increased. Adjustments 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
Corporation 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) Liquidation.
------------
In the event of the dissolution or liquidation of the Corporation,
each Option shall terminate immediately prior to the consummation of such
action. The Committee shall notify the Optionee not less than fifteen (15)
days prior to the proposed consummation of a pending dissolution or
liquidation, and the Option shall be exercisable as to all Shares which are
vested prior to expiration until immediately prior to the consummation of such
action.
(c) Merger.
-------
In the event of a merger or acquisition involving an acquisition of
the Corporation or an acquisition by the Corporation of another company, the
result of which is that the outstanding voting securities of the Corporation
do not represent, or are not converted into, a majority of the outstanding
voting securities of the surviving corporation, except as otherwise provided
in any particular Option agreement, the vesting of all unvested Options shall
be accelerated and all options shall be immediately exercisable. Without
limiting the generality of the foregoing, in the event of (i) a proposed
merger of the Corporation with or into another corporation, as a result of
which the Corporation is not the surviving corporation and (ii) the Option is
not assumed or an equivalent option substituted by the successor corporation
or a parent or subsidiary of the successor corporation, then in such case each
Option shall terminate immediately prior to the consummation of such
transaction. The Committee shall notify the Optionee not less than fifteen
(15) days prior to the proposed consummation of such transaction, and the
Option shall be exercisable as to all Shares subject to such Option until
immediately prior to the consummation of such transaction.
(d) Determination by Committee.
---------------------------
All adjustments described in this Section 8 shall be made by the
Committee, whose determination shall be conclusive and binding on all persons.
(e) Limitation on Rights of Optionee.
---------------------------------
Except as expressly provided in this Section 8, no Optionee shall
have any rights by reason of any payment of any stock dividend, stock split or
reverse stock split or any other increase or decrease in the number of shares
of stock of any class, or by reason of any reorganization, consolidation,
dissolution, liquidation, merger, exchange, split-up or reverse split-up, or
spin-off of assets or stock of another corporation. Any issuance by the
Corporation of Shares, Options or securities convertible into Shares or
50
<PAGE>
Options shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or Exercise Price of the Shares for which an
Option is exercisable.
(f) No Restriction on Rights of Corporation.
----------------------------------------
The grant of an Option shall not affect in any way the right or
power of the Corporation to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure, or to merge
or consolidate, or to dissolve, liquidate, sell, or transfer all or any part
of its business or assets.
9. SECURITIES LAW REQUIREMENTS.
----------------------------
(a) Legality of Issuance.
No Share shall be issued upon the exercise of any Option unless
and until the Corporation has determined that:
(i) The Corporation and the Optionee have taken all actions
required to exempt the issuance of the Shares from the registration
requirements under the Securities Act of 1933, as amended (the "Act"), or the
Corporation and the Optionee shall determine that the registration
requirements of the Act do not apply to such exercise;
(ii) Any applicable listing requirement of any stock exchange on
which the Common Stock is listed has been satisfied; and
(iii) Any other applicable provision of state or Federal law has
been satisfied.
(b) Restrictions on Transfer; Representations of Optionee; Legends.
---------------------------------------------------------------
Regardless of whether the offering and sale of Shares has been
registered under the Act or has been registered or qualified under the
securities laws of any state, the Corporation may impose restrictions upon the
sale, pledge, or other transfer of such Shares, including the placement of
appropriate legends on stock certificates, if, in the judgment of the
Corporation and its counsel, such restrictions are necessary or desirable in
order to achieve compliance with the provisions of the Act, the securities
laws of any state, or any other law. If the sale of Shares is not registered
under the Act and the Corporation shall determine that the registration
requirements of the Act apply to such sale, but an exemption is available
which requires an investment representation or other representation, the
Optionee shall be required, as a condition to purchasing Shares by exercise of
his or her Option, to represent that such Shares are being acquired for
investment, and not with a view to the sale or distribution thereof, except in
compliance with the Act, and to make such other representations as are deemed
necessary or appropriate by the Corporation and its counsel. Stock
certificates evidencing Shares acquired pursuant to an unregistered
transaction to which the Act applies shall bear such restrictive legends as
are required or deemed advisable under the Plan or the provisions of any
applicable law. Any determination by the Corporation and its counsel in
connection with any of the matters set forth in this section shall be
conclusive and binding on all persons.
(c) Registration or Qualification of Securities.
--------------------------------------------
The Corporation may, but shall not be obligated to, register or
qualify the sale of Shares under the Act or any other applicable law.
(d) Exchange of Certificates.
-------------------------
If, in the opinion of the Corporation and its counsel, any legend
placed on a stock certificate representing Shares sold hereunder is no longer
required, the Optionee or the holder of such certificate shall be entitled to
exchange such certificate for a certificate representing the same number of
Shares but lacking such legend.
10. AMENDMENT OF THE PLAN.
----------------------
The Plan may be amended at any time and from time to time by the Board as
the Board shall deem
51
<PAGE>
advisable including, but not limited to amendments necessary to qualify for
any exemption or to comply with applicable law or regulations, provided,
however, that except as provided in Section 8, the Board may not, without
further approval by the shareholders of the Corporation, materially increase
the number of shares of Common Stock as to which Options may be granted under
the Plan, materially increase the benefits accruing to Participants under the
Plan or materially modify the requirements as to eligibility for Participants
in the Plan. No amendment of the Plan shall materially and adversely affect
any right of any Optionee with respect to any Option theretofore granted
without such Optionee's written consent. The Plan may not be amended more
frequently than once every six months with respect to the number of shares
subject to Options granted to members of the Board of Directors, the timing of
such Option grants and the determination of the exercise price of such Options
other than to comport with changes in the Code, the Employee Retirement
Security Act, or the rules thereunder. Notwithstanding anything to the
contrary contained herein, this Plan shall not be amended except in accordance
with the provisions of Rule 16b-3(c) under the Securities Exchange Act of
1934, as amended, or any successor rule thereto.
11. APPLICATION OF FUNDS.
---------------------
The proceeds received by the Corporation from the sale of Common Stock
pursuant to the exercise of an Option shall be used for general corporate
purposes.
12. APPROVAL OF SHAREHOLDERS.
-------------------------
The Plan shall be subject to approval by the affirmative vote of the
holders of a majority of all classes of the outstanding shares present and
entitled to vote at the first meeting of shareholders of the Corporation
following the adoption of the Plan, and in no event later than one (1) year
following the Effective Date. Prior to such approval, Options may be granted
but shall not be exercisable.
13. WITHHOLDING OF TAXES.
---------------------
In the event the Corporation or a Subsidiary determines that it is
required to withhold Federal, state, or local taxes in connection with the
exercise of an Option or the disposition of Shares issued pursuant to the
exercise of an Option, the Optionee or any person succeeding to the rights of
the Optionee, as a condition to such exercise or disposition, may be required
to make arrangements satisfactory to the Corporation or the Subsidiary to
enable it to satisfy such withholding requirements.
14. RIGHTS AS A DIRECTOR.
---------------------
Neither the Plan nor any Option granted pursuant thereto shall be
construed to give any person the right to remain as a Director of the
Corporation or any Subsidiary.
52
<PAGE>
EXHIBIT 10.05
CALIFORNIA MICRO DEVICES CORPORATION
1995 EMPLOYEE STOCK PURCHASE PLAN
---------------------------------
AMENDED AS OF JULY 18, 1997
---------------------------
1. PURPOSE.
--------
The purpose of this Plan is to provide an opportunity for Employees of
California Micro Devices Corporation (the "Corporation") and its Designated
Subsidiaries, to purchase Common Stock of the Corporation and thereby to have
n additional incentive to contribute to the prosperity of the Corporation. It
is the intention of the Corporation that the Plan qualify as an "Employee
Stock Purchase Plan" under Section 423 of the Internal Revenue Code of 1986,
as amended, and the Plan shall be construed in accordance with this intention.
2. DEFINITIONS.
------------
(a) "Board" shall mean the Board of Directors of the Corporation.
-------
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
------
(c) "Committee" shall mean the committee appointed by the Board in
-----------
accordance with Section 12 of the Plan.
(d) "Common Stock" shall mean the Common Stock of the Corporation, or
--------------
any stock into which such Common Stock may be converted.
(e) "Compensation" shall mean an Employee's wages or salary and other
--------------
amounts payable to an Employee on account of personal services rendered by the
Employee to the Corporation or a Designated Subsidiary and which are
reportable as wages or other compensation on the Employee's Form W-2, plus
pre-tax contributions of the Employee under a cash or deferred arrangement
(401(k) plan) or cafeteria plan maintained by the Corporation or a Designated
Subsidiary, but excluding, however, (1) non-cash fringe benefits, (2) special
payments as determined by the Committee (e.g., moving expenses, unused
vacation, severance pay), (3) income from the exercise of stock options or
other stock purchases and (4) any other items of Compensation as determined by
the Committee.
(f) "Corporation" shall mean California Micro Devices Corporation, a
-------------
California corporation.
(g) "Designated Subsidiary" shall mean a Subsidiary which has been
-----------------------
designated by the Board as eligible to participate in the Plan.
(h) "Employee" shall mean an individual employed (within the meaning of
----------
Code section 3401(c) and the regulations thereunder) by the Corporation or a
Designated Subsidiary.
(i) "Entry Date" shall mean the first day of each Option Period.
------------
The first Entry Date shall be such date as is determined by the Committee.
(j) "Exercise Date" shall mean the last business day of each Exercise
---------------
Period.
(k) "Exercise Period" shall mean a six-month or other period as
-----------------
determined by the Committee. The first Exercise Period during an
Option Period shall commence on the first day of such Option Period.
Subsequent Exercise Periods, if any, shall run consecutively after the
termination of the preceding Exercise
53
<PAGE>
Period. The last Exercise Period in an Option Period shall terminate on
the last day of such Option Period.
(l) "Fair Market Value" shall mean the value of one (1) share of Common
-------------------
Stock on the relevant date, determined as follows:
(1) If the shares are traded on an exchange or on the Nasdaq
Stock Market, the reported "closing price" on the next preceding trading day
(provided that in the case of the first Entry Date, the Fair Market Value
shall be the initial price to the public in the Company's initial public
offering);
(2) If the shares are traded over-the-counter on the NASDAQ
System (other than on the Nasdaq Stock Market), the mean between the bid and
the ask prices on said System at the close of business on the next preceding
trading day (provided that in the case of the first Entry Date, the Fair
Market Value shall be the initial price to the public in the Company's initial
public offering); and
(3) If neither (1) nor (2) applies, the fair market value as
determined by the Committee in good faith. Such determination shall be
conclusive and binding on all persons.
(m) "Option Period" shall mean a period of up to twenty-seven (27)
---------------
months as determined by the Committee.
(n) "Participant" shall mean a participant in the Plan as described in
-------------
Section 4 of the Plan.
(o) "Plan" shall mean this employee stock purchase plan.
------
(p) "Subsidiary" shall mean any corporation (other than the
------------
Corporation) in an unbroken chain of corporations beginning with the
Corporation, as described in Code section 424(f).
3. ELIGIBILITY.
------------
Any Employee regularly employed on a full-time basis by the Corporation
or by any Designated Subsidiary on an Entry Date shall be eligible to
participate in the Plan with respect to the Option Period commencing on such
Entry Date, provided that the Committee may establish administrative rules
requiring that employment commence some minimum period (e.g., one pay period)
prior to an Entry Date to be eligible to participate with respect to that
Entry Date. An Employee shall be considered employed on a full-time basis
unless his or her customary employment is less than 20 hours per week or five
months per year. No Employee may participate in the Plan if immediately after
an option is granted the Employee owns or is considered to own (within the
meaning of section 424(d) of the Code), shares of stock, including stock which
the Employee may purchase by conversion of convertible securities or under
outstanding options granted by the Corporation, possessing five percent (5%)
or more of the total combined voting power or value of all classes of stock of
the Corporation or of any of its Subsidiaries. All Employees who participate
in the Plan shall have the same rights and privileges under the Plan except
for differences which may be mandated by local law and which are consistent
with Code section 423(b)(5). The Committee may impose restrictions on
eligibility and participation of Employees who are officers and directors to
facilitate compliance with federal or state securities laws.
4. PARTICIPATION.
--------------
4.1 An Employee who is eligible to participate in the Plan in
accordance with Section 3 may become a Participant by filing, on a
date prescribed by the Committee prior to an applicable Entry Date,
a completed payroll deduction authorization and Plan enrollment form
provided by the Corporation. An eligible Employee may authorize
payroll deductions at the rate of any whole percentage of the
Employee's Compensation, not to exceed fifteen percent (15%) of the
Employee's Compensation, or such lesser percentage as specified by the
Committee as applied to an Entry Date or Option Period. All payroll
deductions may be held by the Corporation and commingled with its other
corporate funds. No interest shall be paid or credited to the Participant
with respect to such payroll deductions except where required by local
54
<PAGE>
law as determined by the Committee. A separate bookkeeping account for each
Participant shall be maintained by the Corporation under the Plan and the
amount of each Participant's payroll deductions shall be credited to such
account. A Participant may not make any additional payments into such
account.
4.2 Under procedures established by the Committee, a Participant may
suspend or discontinue participation in the Plan or may reduce the rate of his
or her payroll deductions at any time during an Offering Period by completing
and filing a new payroll deduction authorization and Plan enrollment form with
the Corporation, provided that the Committee may, in its discretion, impose
restrictions on a Participant's ability to change the rate of payroll
deductions. A Participant may increase his or her rate of payroll deductions
only effective on an Entry Date by filing a new payroll deduction
authorization and Plan enrollment form. If a new payroll deduction
authorization and Plan enrollment form is not filed with the Corporation, the
rate of payroll deductions shall continue at the originally elected rate
throughout the Option Period unless the Committee determines to change the
permissible rate.
If a Participant suspends participation during an Exercise Period,
his or her accumulated payroll deductions will remain in the Plan for purchase
of shares as specified in Section 6 on the following Exercise Date, but the
Participant will not again participate until he or she completes a new payroll
deduction authorization and Plan enrollment form. The Committee may establish
rules limiting the frequency with which Participants may suspend and resume
payroll deductions under the Plan and may impose a waiting period on
Participants wishing to resume suspended payroll deductions. If a Participant
discontinues participation in the Plan, the amount credited to the
Participant's individual account shall be paid to the Participant without
interest (except where required by local law). In the event any Participant
terminates employment with the Corporation or any Subsidiary for any reason
(including death) prior to the expiration of an Option Period, the
Participant's participation in the Plan shall terminate and all amounts
credited to the Participant's account shall be paid to the Participant or the
Participant's estate without interest (except where required by local law).
Whether a termination of employment has occurred shall be determined by the
Committee. The Committee may also establish rules regarding when leaves of
absence or change of employment status (e.g., from full-time to part-time)
will be considered to be a termination of employment, and the Committee may
establish termination of employment procedures for this Plan which are
independent of similar rules established under other benefit plans of the
Corporation and its Subsidiaries.
In the event of a Participant's death, any accumulated payroll
deductions will be paid, without interest, to the estate of the Participant.
5. OFFERING.
---------
5.1 The maximum number of shares of Common Stock which may be issued
pursuant to the Plan shall be 300,000 shares. The Committee may designate any
amount of available shares for offering for any Option Period determined
pursuant to Section 5.2.
5.2 Each Option Period, Entry Date and Exercise Period shall be
determined by the Committee. The Committee shall have the power to change the
duration of future Option Periods or future Exercise Periods, and to determine
whether or not to have overlapping Option Periods, with respect to any
prospective offering, without shareholder or Board approval.
5.3 With respect to each Option Period, each eligible Employee who has
elected to participate as provided in Section 4.1 shall be granted an option
to purchase that number of shares of Common Stock which may be purchased with
the payroll deductions accumulated on behalf of such Employee (assuming
payroll deductions at a rate of 15% of Compensation) during each Exercise
Period within such Option Period at the purchase price specified in Section
5.4 below; provided, however, (1) in no event shall the Employee be entitled
to accrue rights to purchase shares under the Plan (and all other employee
stock purchase plans, as defined in Code section 423, of the Corporation and
its subsidiaries) at a rate which exceeds $25,000 of the Fair Market Value of
such stock (determined at the time the option is granted) for any calendar
year in which such option is outstanding at any time, and (2) the maximum
shares subject to any option shall in no event exceed 10,000.
55
<PAGE>
5.4 The option price under each option shall be the lower of:
(i) eighty-five percent (85%) of the Fair Market Value of the Common Stock on
the Entry Date on which an option is granted, or (ii) eighty-five percent
(85%) of the Fair Market Value on the Exercise Date on which the Common Stock
is purchased.
5.5 If the total number of shares of Common Stock for which options
granted under the Plan are exercisable exceeds the maximum number of shares
offered on any Entry Date, the number of shares which may be purchased under
options granted on the Entry Date shall be reduced on a pro rata basis in as
nearly a uniform manner as shall be practicable and equitable. In this event,
payroll deductions shall also be reduced or refunded accordingly. If an
Employee's payroll deductions during any Exercise Period exceeds the purchase
price for the maximum number of shares permitted to be purchased under Section
5.3, the excess shall be refunded to the Participant without interest (except
where otherwise required by local law).
5.6 In the event that the Fair Market Value of the Corporation's Common
Stock is lower on the first day of an Exercise Period within an Option Period
(subsequent "Reassessment Date") than it was on Entry Date for such Option
Period, all Employees participating in the Plan on the Reassessment Date shall
be deemed to have relinquished the unexercised portion of the option granted
on the Entry Date and to have enrolled in and received a new option commencing
on such Reassessment Date, unless the Committee has determined not to permit
overlapping Option Periods or to restrict such transfers to lower price Option
Periods.
6. PURCHASE OF STOCK.
------------------
Upon the expiration of each Exercise Period, a Participant's option shall
be exercised automatically for the purchase of that number of full shares of
Common Stock which the accumulated payroll deductions credited to the
Participant's account at that time shall purchase at the applicable price
specified in Section 5.4.
7. PAYMENT AND DELIVERY.
---------------------
Upon the exercise of an option, the Corporation shall deliver to the
Participant the Common Stock purchased and the balance of any amount of
payroll deductions credited to the Participant's account not used for the
purchase. The Committee may permit or require that shares be deposited
directly with a broker designated by the Participant (or a broker selected by
the Committee), and the Committee may utilize electronic or automated methods
of share transfer. To the extent the unused cash balance represents a
fractional share, the unused cash balance credited to the Participant's
account shall be carried over to the next Exercise Period, if the Participant
is also a Participant in the Plan at that time or refunded to the Participant,
as determined by the Committee. The Corporation shall retain the amount of
payroll deductions used to purchase Common Stock as full payment for the
Common Stock and the Common Stock shall then be fully paid and non-assessable.
No Participant shall have any voting, dividend, or other stockholder rights
with respect to shares subject to any option granted under the Plan until the
option has been exercised and shares issued.
8. RECAPITALIZATION.
-----------------
If after the grant of an option, but prior to the purchase of Common
Stock under the option, there is any increase or decrease in the number of
outstanding shares of Common Stock because of a stock split, stock dividend,
combination or recapitalization of shares subject to options, the number of
shares to be purchased pursuant to an option, the share limit of Section 5.3
and the maximum number of shares specified in Section 5.1 shall be
proportionately increased or decreased, the terms relating to the purchase
price with respect to the option shall be appropriately adjusted by the
Committee, and the Committee shall take any further actions which, in the
exercise of its discretion, may be necessary or appropriate under the
circumstances.
56
<PAGE>
The Committee, if it so determines in the exercise of its sole
discretion, also may adjust the number of shares specified in Section 5.1, as
well as the price per share of Common Stock covered by each outstanding option
and the maximum number of shares subject to any individual option, in the
event the Corporation effects one or more reorganizations, recapitalizations,
spin-offs, split-ups, rights offerings or reductions of shares of its
outstanding Common Stock.
The Committee's determinations under this Section 8 shall be conclusive
and binding on all parties.
9. MERGER, LIQUIDATION, OTHER CORPORATION TRANSACTIONS.
----------------------------------------------------
In the event of the proposed liquidation or dissolution of the
Corporation, the Option Period will terminate immediately prior to the
consummation of such proposed transaction, unless otherwise provided by the
Committee in its sole discretion, and all outstanding options shall
automatically terminate and the amounts of all payroll deductions will be
refunded without interest to the Participants.
In the event of a proposed sale of all or substantially all of the assets
of the Corporation, or the merger or consolidation of the Corporation with or
into another corporation, then in the sole discretion of the Committee, (1)
each option shall be assumed or an equivalent option shall be substituted by
the successor corporation or parent or subsidiary of such successor
corporation, (2) a date established by the Committee on or before the date of
consummation of such merger, consolidation or sale shall be treated as an
Exercise Date, and all outstanding options shall be deemed exercisable on such
date or (3) all outstanding options shall terminate and the accumulated
payroll deductions shall be returned to the Participants.
10. TRANSFERABILITY.
----------------
Options granted to Participants may not be voluntarily or involuntarily
assigned, transferred, pledged, or otherwise disposed of in any way, and any
attempted assignment, transfer, pledge, or other disposition shall be null and
void and without effect. If a Participant in any manner attempts to transfer,
assign or otherwise encumber his or her rights or interest under the Plan,
other than as permitted by the Code, such act shall be treated as an election
by the participant to discontinue participation in the Plan pursuant to
Section 4.2.
11. AMENDMENT OR TERMINATION OF THE PLAN.
-------------------------------------
11.1 The Plan shall continue until February 9, 2005, unless previously
terminated in accordance with Section 11.2.
11.2 The Board may, in its sole discretion, insofar as permitted by
law, terminate or suspend the Plan, or revise or amend it in any respect
whatsoever, except that, without approval of the stockholders, no such
revision or amendment shall:
(a) materially increase the number of shares subject to the Plan
other than an adjustment under Section 8 of the Plan;
(b) materially modify the requirements as to eligibility for
participation in the Plan;
(c) materially increase the benefits accruing to Participants;
(d) reduce the purchase price specified in Section 5.4, except
as specified in Section 8;
(e) extend the term of the Plan beyond the date specified in
Section 11.1; or
(f) amend this Section 11.2 to defeat its purpose.
57
<PAGE>
12. ADMINISTRATION.
---------------
The Plan shall be administered by a Committee which shall consist of at
least three members appointed by the Board. The Committee shall have full
power and authority to promulgate any rules and regulations which it deems
necessary for the proper administration of the Plan, to interpret the
provisions and supervise the administration of the Plan, and to take all
action in connection with administration of the Plan as it deems necessary or
advisable. Decisions of the Committee shall be made by a majority of its
members and shall be final and binding upon all participants. Any decision
reduced to writing and signed by a majority of the members of the Committee
shall be fully effective as if it had been made at a meeting of the Committee
duly held. The Corporation shall pay all expenses incurred in the
administration of the Plan. No Committee member shall be liable for any
action or determination made in good faith with respect to the Plan or any
option granted thereunder.
13. COMMITTEE RULES FOR FOREIGN JURISDICTIONS.
------------------------------------------
The Committee may adopt rules or procedures relating to the operation
and administration of the Plan in non-United States jurisdictions to
accommodate the specific requirements of local laws and procedures. Without
limiting the generality of the foregoing, the Committee is specifically
authorized to adopt rules and procedures regarding handling of payroll
deductions, conversion of local currency, withholding procedures and handling
of stock certificates which vary with local requirements.
14. SECURITIES LAWS REQUIREMENTS.
-----------------------------
The Corporation shall not be under any obligation to issue Common Stock
upon the exercise of any option unless and until the Corporation has
determined that: (i) it and the Participant have taken all actions required to
register the Common Stock under the Securities Act of 1933, or to perfect an
exemption from the registration requirements thereof; (ii) any applicable
listing requirement of any stock exchange on which the Common Stock is listed
has been satisfied; and (iii) all other applicable provisions of state and
federal law have been satisfied.
15. GOVERNMENTAL REGULATIONS.
-------------------------
This Plan and the Corporation's obligation to sell and deliver shares of
its stock under the Plan shall be subject to the approval of any governmental
authority required in connection with the Plan or the authorization, issuance,
sale, or delivery of stock hereunder.
16. NO ENLARGEMENT OF EMPLOYEE RIGHTS.
----------------------------------
Nothing contained in this Plan shall be deemed to give any Employee the
right to be retained in the employ of the Corporation or any Designated
Subsidiary or to interfere with the right of the Corporation or Designated
Subsidiary to discharge any Employee at any time.
17. GOVERNING LAW.
--------------
This Plan shall be governed by California law, but shall be interpreted
to be consistent with the requirements of any employee stock purchase plan
under Code section 423.
18. EFFECTIVE DATE.
---------------
This Plan shall be effective February 10, 1995, subject to approval of
the shareholders of the Corporation within 12 months of its adoption by the
Board of Directors.
58
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> JUN-30-1997
<CASH> 95
<SECURITIES> 6,136
<RECEIVABLES> 4,358
<ALLOWANCES> (465)
<INVENTORY> 9,295
<CURRENT-ASSETS> 20,366<F1>
<PP&E> 25,072
<DEPRECIATION> (10,664)
<TOTAL-ASSETS> 38,333<F2>
<CURRENT-LIABILITIES> 5,724
<BONDS> 0
0
0
<COMMON> 52,389
<OTHER-SE> (28,270)
<TOTAL-LIABILITY-AND-EQUITY> 38,333
<SALES> 8,108
<TOTAL-REVENUES> 8,314<F3>
<CGS> 5,265
<TOTAL-COSTS> 5,265
<OTHER-EXPENSES> 2,695<F4>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 238
<INCOME-PRETAX> 116
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 116
<EPS-PRIMARY> .01
<EPS-DILUTED> .01
<FN>
<F1>Includes Prepaid expenses and other assets - 947.
<F2>Includes Restricted cash - 3,142; and Other long-term assets - 417.
<F3>Includes Technology related sales - 206.
<F4>Includes Research and development - 808; Selling, marketing,
and administrative - 2,016; Interest (income) - (127);
Other (income)/expense - (2).
</FN>
</TABLE>
