As filed with the Securities and Exchange Commission on May 19, 1998
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------------
MICRO LINEAR CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 94-2910085
(State of Incorporation) (I.R.S. Employer
Identification No.)
2092 Concourse Drive
San Jose, California 95131
(Address of Principal Executive Offices, including Zip Code)
----------------------------------------
Nonstatutory Stock Option Plan
1991 Stock Option Plan
1994 Employee Stock Purchase Plan
-----------------------------------------
Arthur B. Stabenow
President and Chief Executive Officer
MICRO LINEAR CORPORATION
2092 Concourse Drive
San Jose, California 95131
(415) 433-5200
(Name, address and telephone number of agent for service)
--------------------
Copy to:
J. Robert Suffoletta
WILSON SONSINI GOODRICH & ROSATI, P.C.
650 Page Mill Road
Palo Alto, California 94304-1050
--------------------
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
Title of Securities to be Registered Amount to be Proposed Maximum Proposed Maximum Amount of
Registered Offering Price Aggregate Offering Registration
Per Share(1) Price(1) Fee
Common Stock, $.001 par value, to be 600,000 $5.1875 $3,112,500.00 $ 918.19
issued under the Nonstatutory Stock
Option Plan
Common Stock, $.001 par value, to be 1,409,885 $5.1875 $7,313,778.44 $2,157.56
issued under the 1991 Stock
Option Plan
Common Stock, $.001 par value, to be 175,000 $4.409375 $ 771,640.63 $ 227.63
issued under the 1994 Employee Stock
Purchase Plan
TOTAL: 2,184,885 $11,197,919.07 $3,303.38
<FN>
(1) The Proposed Maximum Offering Price Per Share was estimated pursuant
to Rule 457 under the Securities Act of 1933, as amended (the "Act"). The
price per share was determined by reference to the average between the high
("FMV") and low price reported in the Nasdaq National Market on May 14, 1998.
The price per share for the 1994 Employee Stock Purchase Plan was determined by
reference to 85% of the FMV.
</FN>
</TABLE>
<PAGE>
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents and information previously filed with the Securities
and Exchange Commission (the "Commission") by Micro Linear Corporation (the
"Company") are hereby incorporated by reference in this Registration Statement:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1997 filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act").
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended March 31,
1998 filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act").
(c) The description of the Company's common stock which is contained in the
Company's Registration Statement on Form 8-A filed with the Commission pursuant
to Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and any description of any securities of the Registrant which is
contained in any registration statement filed after the date hereof under
Section 12 of the Exchange Act, including any amendment or report filed for the
purpose of updating any such description.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment which indicates that all securities registered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be part hereof
from the date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
The Company's Certificate of Incorporation limits the liability of directors to
the maximum extent permitted by Delaware law. Delaware law provides that
directors of a company will not be personally liable for monetary damages for
breach of their fiduciary duties as directors, except for liability (i) for any
breach of their duty of loyalty to the company or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct or
knowing violation of law, (iii) for unlawful payments or dividends or unlawful
stock repurchases or redemptions as provided Section 174 of Delaware General
Corporation Law or (iv) for transactions from which the director derived an
improper personal benefit.
The Company's Bylaws provide that the Company shall indemnify its officers and
directors and may indemnify its employees and other agents to the fullest extent
provided by Delaware law, including those circumstances where indemnification
would otherwise be discretionary under Delaware law. The Company believes that
indemnification under its Bylaws covers at least negligence on the part of
indemnified parties. The Bylaws authorize the use of indemnification agreements
and the Company has entered into such agreements with each of its directors and
officers.
The Company carries officer and director liability insurance with respect to
certain matters, including matters arising under the Securities Act.
Delaware Law does not permit a corporation to eliminate a director's duty of
care, and the provisions of the Company's Certificate of Incorporation have no
effect on the availability of equitable remedies such as injunction or
rescission, based upon a director's breach of the duty of care. Insofar as
indemnification for liabilities arising under the Exchange Act may be permitted
to foregoing provisions and agreements, the Company has been informed that in
the opinion of the staff of the Commission such indemnification is against
public policy as expressed in the Exchange Act and is therefore unenforceable.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit
Number Description
4.1 Nonstatutory Stock Option Plan.
4.2 1991 Stock Option Plan, as amended.
4.3 1994 Employee Stock Purchase Plan, as amended.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, P.C.
23.1 Consent of Independent Accountants.
23.2 Consent of Independent Auditors.
23.3 Consent of Counsel (contained in Exhibit 5.1).
24.1 Power of Attorney (see page II-4).
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement to include any material
information with respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such information in the
Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(4) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Exchange Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Exchange Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Jose, State of California, on this 15th day of
May, 1998.
MICRO LINEAR CORPORATION
By: /s/ Arthur B. Stabenow
----------------------
Arthur B. Stabenow
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Arthur B. Stabenow and J. Philip Russell,
and each of them acting individually, as his or her attorney-in-fact, each with
full power of substitution, for him or her in any and all capacities, to sign
any and all amendments to this Registration Statement on Form S-8, and to file
the same, with exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, hereby ratifying and confirming all
that each of said attorneys-in-fact, or any substitute, may do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on May 15th, 1998 by the following
persons in the capacities indicated:
Signature Title
/s/ Arthur B. Stabenow Director, Chief Executive Officer
- ---------------------- and President (Principal
Arthur B. Stabenow Executive Officer)
/s/ J. Philip Russell Chief Financial Officer
- ---------------------- (Principal Financial and Accounting
J. Philip Russell Officer)
/s/ Joseph D. Rizzi Director
- ----------------------
Joseph D. Rizzi
/s/ Roger A. Smullen Director
- ----------------------
Roger A. Smullen
/s/ Jeffrey D. West Director
- ----------------------
Jeffrey D. West
/s/ David Gellatly Director
- ----------------------
David Gellatly
<PAGE>
MICRO LINEAR CORPORATION
REGISTRATION STATEMENT ON FORM S-8
INDEX TO EXHIBITS
Exhibit
Number Description
4.1 Nonstatutory Stock Option Plan.
4.2 1991 Stock Option Plan, as amended.
4.3 1994 Employee Stock Purchase Plan, as amended.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, P.C.
23.1 Consent of Independent Accountants.
23.2 Consent of Independent Auditors.
23.3 Consent of Counsel (contained in Exhibit 5.1).
24.1 Power of Attorney (see page II-4).
EXHIBIT 4.1
MICRO LINEAR CORPORATION
1998 NONSTATUTORY STOCK OPTION PLAN
1. Purposes of the Plan. The purposes of this Nonstatutory Stock Option
Plan are: o to attract and retain the best available personnel for positions of
substantial responsibility, o to provide additional incentive to Employees,
Directors and Consultants, and o to promote the success of the Company's
business. Options granted under the Plan will be Nonstatutory Stock Options.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees as
shall be administering the Plan, in accordance with Section 4 of the Plan.
(b) "Applicable Laws" means the requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options are, or will be, granted under
the Plan.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means a committee of Directors appointed by
the Board in accordance with Section 4 of the Plan.
(f) "Common Stock" means the Common Stock of the Company.
(g) "Company" means Micro Linear Corporation, a Delaware
corporation.
(h) "Consultant" means any person, including an advisor, engaged
by the Company or a Parent or Subsidiary to render services
to such entity.
(i) "Director" means a member of the Board.
(j) "Disability" means total and permanent disability as defined
in Section 22(e)(3) of the Code.
(k) "Employee" means any person, including Officers, employed by
the Company or any Parent or Subsidiary of the Company. A Service Provider shall
not cease to be an Employee in the case of (i) any leave of absence approved by
the Company or (ii) transfers between locations of the Company or between the
Company, its Parent, any Subsidiary, or any successor. Neither service as a
Director nor payment of a director's fee by the Company shall be sufficient to
constitute "employment" by the Company.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(m) "Fair Market Value" means, as of any date, the value of
Common Stock determined as follows:
(i) If the Common Stock is listed on any
established stock exchange or a national market system, including without
limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The
Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or system for the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;
(ii) If the Common Stock is regularly quoted by a
recognized securities dealer but selling
prices are not reported, the Fair Market Value of a Share of Common Stock shall
be the mean between the high bid and low asked prices for the Common Stock on
the last market trading day prior to the day of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems
reliable;
(iii) In the absence of an established market for the
Common Stock, the Fair Market Value shall
be determined in good faith by the Administrator.
(n) "Notice of Grant" means a written or electronic notice
evidencing certain terms and conditions of an individual Option grant. The
Notice of Grant is part of the Option Agreement.
(o) "Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(p) "Option" means a nonstatutory stock option granted pursuant
to the Plan, that is not intended to qualify as an incentive stock option within
the meaning of Section 422 of the Code and the regulations promulgated
thereunder.
(q) "Option Agreement" means an agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
The Option Agreement is subject to the terms and conditions of the Plan.
(r) "Option Exchange Program" means a program whereby outstanding
options are surrendered in exchange for options with a lower exercise price.
(s) "Optioned Stock" means the Common Stock subject to an Option.
(t) "Optionee" means the holder of an outstanding Option granted
under the Plan.
(u) "Parent" means a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
(v) "Plan" means this 1998 Nonstatutory Stock Option Plan.
(w) "Service Provider" means an Employee including an Officer,
Consultant or Director.
(x) "Share" means a share of the Common Stock, as adjusted
in accordance with Section 12 of the Plan.
(y) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 12 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is Six Hundred Thousand (600,000) Shares. The Shares may be
authorized, but unissued, or reacquired Common Stock.
If an Option expires or becomes unexercisable without having been
exercised in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated).
4. Administration of the Plan.
(a) Administration. The Plan shall be administered by (i) the
Board or (ii) a Committee, which committee shall be constituted to satisfy
Applicable Laws.
(b) Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:
(i) to determine the Fair Market Value of the Common
Stock;
(ii) to select the Service Providers to whom Options may
be granted hereunder;
(iii) to determine whether and to what extent Options are
granted hereunder;
(iv) to determine the number of shares of Common Stock to
be covered by each Option granted
hereunder;
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any
award granted hereunder. Such terms and conditions include, but are not limited
to, the exercise price, the time or times when Options may be exercised (which
may be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option
or the shares of Common Stock relating thereto, based in each case on such
factors as the Administrator, in its sole discretion, shall determine;
(vii) to reduce the exercise price of any Option to the
then current Fair Market Value if the
Fair Market Value of the Common Stock covered by such Option shall have declined
since the date the Option was granted;
(viii) to institute an Option Exchange Program;
(ix) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;
(x) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;
(xi) to modify or amend each Option (subject to Section
14(b) of the Plan), including the discretionary authority to extend the
post-termination exercisability period of Options longer than is otherwise
provided for in the Plan;
(xii) to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option previously
granted by the Administrator;
(xiii) to determine the terms and restrictions applicable
to Options;
(xiv) to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option that number of Shares having a Fair Market
Value equal to the amount required to be withheld. The Fair Market Value of the
Shares to be withheld shall be determined on the date that the amount of tax to
be withheld is to be determined. All elections by an Optionee to have Shares
withheld for this purpose shall be made in such form and under such conditions
as the Administrator may deem necessary or advisable; and
(xv) to make all other determinations deemed necessary or
advisable for administering the Plan.
(c) Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options.
5. Eligibility. Options may be granted to Service Providers; provided,
however, that notwithstanding anything to the contrary contained in the Plan, an
Option may only be granted to an Officer as an inducement essential to his or
her initial employment with the Company.
6. Limitation. Neither the Plan nor any Option shall confer upon an
Optionee any right with respect to continuing the Optionee's relationship as a
Service Provider with the Company, nor shall they interfere in any way with the
Optionee's right or the Company's right to terminate such relationship at any
time, with or without cause.
7. Term of Plan. The Plan shall become effective upon its adoption by
the Board. It shall continue in effect for ten (10) years, unless sooner
terminated under Section 14 of the Plan.
8. Term of Option. The term of each Option shall be stated in the Option
Agreement.
9. Option Exercise Price and Consideration.
(a) Exercise Price. The per share exercise price for the
Shares to be issued pursuant to exercise of
an Option shall be determined by the Administrator.
(b) Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.
(c) Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. Such consideration may consist entirely of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) other Shares which (A) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for
more than six (6) months on the date of surrender, and (B) have a Fair Market
Value on the date of surrender equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised;
(v) consideration received by the Company under a
cashless exercise program implemented by the
Company in connection with the Plan;
(vi) a reduction in the amount of any Company liability
to the Optionee, including any liability attributable to the Optionee's
participation in any Company-sponsored deferred compensation program or
arrangement;
(vii) such other consideration and method of payment for
the issuance of Shares to the extent
permitted by Applicable Laws; or
(viii) any combination of the foregoing methods of
payment.
10. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. An Option may not be exercised for a fraction of
a Share.
An Option shall be deemed exercised when the Company
receives: (i) written or electronic notice of exercise (in accordance with
the Option Agreement) from the person entitled to exercise the Option, and (ii)
full payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 12 of the Plan.
Exercising an Option in any manner shall decrease the
number of Shares thereafter available, both for purposes of the Plan and
for sale under the Option, by the number of Shares as to which the Option is
exercised.
(b) Termination of Relationship as a Service Provider. If an
Optionee ceases to be a Service Provider, other than upon the Optionee's death
or Disability, the Optionee may exercise his or her Option, but only within such
period of time as is specified in the Option Agreement, and only to the extent
that the Option is vested on the date of termination (but in no event later than
the expiration of the term of such Option as set forth in the Option Agreement).
In the absence of a specified time in the Option Agreement, the Option shall
remain exercisable for three (3) months following the Optionee's termination.
If, on the date of termination, the Optionee is not vested as to his or her
entire Option, the Shares covered by the unvested portion of the Option shall
revert to the Plan. If, after termination, the Optionee does not exercise his or
her Option within the time specified by the Administrator, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
(c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option
Agreement, to the extent the Option is vested on the date of termination (but in
no event later than the expiration of the term of such Option as set forth in
the Option Agreement). In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for twelve (12) months following
the Optionee's termination. If, on the date of termination, the Optionee is not
vested as to his or her entire Option, the Shares covered by the unvested
portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert
to the Plan.
(d) Death of Optionee. If an Optionee dies while a Service
Provider, the Option may be exercised within such period of time as is specified
in the Option Agreement (but in no event later than the expiration of the term
of such Option as set forth in the Notice of Grant), by the Optionee's estate or
by a person who acquires the right to exercise the Option by bequest or
inheritance, but only to the extent that the Option is vested on the date of
death. In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for twelve (12) months following the Optionee's
termination. If, at the time of death, the Optionee is not vested as to his or
her entire Option, the Shares covered by the unvested portion of the Option
shall immediately revert to the Plan. The Option may be exercised by the
executor or administrator of the Optionee's estate or, if none, by the person(s)
entitled to exercise the Option under the Optionee's will or the laws of descent
or distribution. If the Option is not so exercised within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.
(e) Buyout Provisions. The Administrator may at any time offer to
buy out for a payment in cash or Shares, an Option previously granted based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.
11. Non-Transferability of Options . Unless determined otherwise by the
Administrator, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee. If the Administrator makes an Option
transferable, such Option shall contain such additional terms and conditions as
the Administrator deems appropriate.
12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
(a) Changes in Capitalization. Subject to any required action by
the shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to such
transaction as to all of the Optioned Stock covered thereby, including Shares as
to which the Option would not otherwise be exercisable. In addition, the
Administrator may provide that any Company repurchase option applicable to any
Shares purchased upon exercise of an Option shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an
Option will terminate immediately prior to the consummation of such proposed
action.
(c) Change of Control. Upon or in connection with an acquisition
of the Company in a transaction or series of related transactions consisting of
a merger, purchase of outstanding stock, sale of all or substantially all of the
Company's assets, or other form of business acquisition or combination, and
which results in a change in control of the Company (the "Acquisition"), all
rights to exercise this Option or to acquire any shares of stock hereunder shall
automatically terminate except as provided in this Section. At such time prior
to the consummation of the Acquisition as the Committee shall designate by
written notice to the Optionee, the Optionee or other person then entitled to
exercise this Option shall have the right to exercise the vested, unexercised
portion of this Option which would, but for this Section, otherwise be vested
and exercisable as of the date on which the Acquisition occurs. If provision is
made in writing in connection with the Acquisition for the assumption of this
Option, or the substitution for this Option of an option covering the stock of a
successor employer corporation, or a parent or subsidiary thereof, with
appropriate adjustments, if any, in accordance with the applicable provisions of
the Plan as to the number and kind of shares optioned and their exercises
prices, then the Optionee shall elect in writing, within time limits as may be
designated in written notice from the Committee to the Optionee, to accept the
assumed or substituted option arrangements, or, in lieu thereof, to exercise the
Option to the extent permitted under this Section, but the Optionee shall not be
entitled in any event to accept the benefits, in whole or in part, of both of
those alternatives. The Optionee agrees that failure to timely accept or
exercise rights under this Section by written confirmation designated in form
and substance by the Committee shall forever bar and release any rights
otherwise granted to the Optionee under this Section or other provisions of this
Option. The Optionee shall have no right to require that this Option be assumed
or replaced with a substitute option in connection with any Acquisition.
13. Date of Grant. The date of grant of an Option shall be, for all
purposes, the date on which the Administrator makes the determination granting
such Option, or such other later date as is determined by the Administrator.
Notice of the determination shall be provided to each Optionee within a
reasonable time after the date of such grant.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time
amend, alter, suspend or terminate the Plan.
(b) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to options granted under the
Plan prior to the date of such termination.
15. Conditions Upon Issuance of Shares.
(a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option unless the exercise of such Option and the issuance and
delivery of such Shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
(b) Investment Representations. As a condition to the exercise of
an Option the Company may require the person exercising such Option to represent
and warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation is
required.
16. Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.
17. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
<PAGE>
MICRO LINEAR CORPORATION
1998 NONSTATUTORY STOCK OPTION PLAN
STOCK OPTION AGREEMENT
Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Option Agreement.
I. NOTICE OF STOCK OPTION GRANT
[Optionee's Name and Address]
You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:
Grant Number
Date of Grant
Vesting Commencement Date
Exercise Price per Share $
Total Number of Shares Granted
Total Exercise Price $
Type of Option: Nonstatutory Stock Option
Term/Expiration Date:
Vesting Schedule:
Subject to the Optionee continuing to be a Service Provider on such
dates, this Option shall vest and become exercisable as to ___% of the Optioned
Stock on [date], and as to an additional ___% of the Optioned Stock on ____.
Termination Period:
This Option may be exercised for thirty (30) days after Optionee ceases
to be a Service Provider. Upon the death or Disability of the Optionee, this
Option may be exercised for such longer period as provided in the Plan. In no
event shall this Option be exercised later than the Term/Expiration Date as
provided above.
<PAGE>
II. AGREEMENT
1. Grant of Option. The Plan Administrator of the Company hereby grants
to the Optionee named in the Notice of Grant attached as Part I of this
Agreement (the "Optionee") an option (the "Option") to purchase the number of
Shares, as set forth in the Notice of Grant, at the exercise price per share set
forth in the Notice of Grant (the "Exercise Price"), subject to the terms and
conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(b) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Option Agreement,
the terms and conditions of the Plan shall prevail.
2. Exercise of Option.
(a) Right to Exercise. This Option is exercisable during its term
in accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.
(b) Method of Exercise. This Option is exercisable by delivery of
an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to [Title]. The Exercise Notice shall be
accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company
of such fully executed Exercise Notice accompanied by such aggregate Exercise
Price.
No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws. Assuming such
compliance, for income tax purposes the Exercised Shares shall be considered
transferred to the Optionee on the date the Option is exercised with respect to
such Exercised Shares.
3. Method of Payment. Payment of the aggregate Exercise Price shall be
by any of the following, or a combination thereof, at the election of the
Optionee:
(a) cash;
(b) check;
(c) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan; or
(d) surrender of other Shares which (i) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more
than six (6) months on the date of surrender, and (ii) have a Fair Market Value
on the date of surrender equal to the aggregate Exercise Price of the Exercised
Shares.
4. Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by the Optionee. The terms
of the Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
5. Term of Option. This Option may be exercised only within the term set
out in the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement.
6. Tax Consequences. Some of the federal tax consequences relating to
this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.
(a) Exercising the Option. The Optionee may incur regular federal
income tax liability upon exercise of an NSO. The Optionee will be treated as
having received compensation income (taxable at ordinary income tax rates) equal
to the excess, if any, of the Fair Market Value of the Exercised Shares on the
date of exercise over their aggregate Exercise Price. If the Optionee is an
Employee or a former Employee, the Company will be required to withhold from his
or her compensation or collect from Optionee and pay to the applicable taxing
authorities an amount in cash equal to a percentage of this compensation income
at the time of exercise, and may refuse to honor the exercise and refuse to
deliver Shares if such withholding amounts are not delivered at the time of
exercise.
(b) Disposition of Shares. If the Optionee holds NSO Shares for
at least one year, any gain realized on disposition of the Shares will be
treated as long-term capital gain for federal income tax purposes.
7. Entire Agreement; Governing Law. The Plan is incorporated herein by
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws, but not
the choice of law rules, of California.
8. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES
THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED
ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT
THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A
SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL
NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT
CAUSE.
By your signature and the signature of the Company's representative
below, you and the Company agree that this Option is granted under and governed
by the terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.
OPTIONEE MICRO LINEAR CORPORATION
___________________________________ By: _______________________________
Signature
____________________________________ Title: ____________________________
Print Name
- ------------------------------------
Residence Address
- ------------------------------------
<PAGE>
EXHIBIT A
MICRO LINEAR CORPORATION
1998 NONSTATUTORY STOCK OPTION PLAN
EXERCISE NOTICE
Micro Linear Corporation
2092 Concourse Drive
San Jose, CA 95131
Attention: [Title]
1. Exercise of Option. Effective as of today, ________________, 199__,
the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of Micro Linear Corporation (the "Company")
under and pursuant to the 1998 Nonstatutory Stock Option Plan (the "Plan") and
the Stock Option Agreement dated
, 19___ (the "Option Agreement"). The purchase price for
the Shares shall be $ , as required by the Option Agreement.
2. Delivery of Payment. Purchaser herewith delivers to the Company the
full purchase price for the Shares.
3. Representations of Purchaser. Purchaser acknowledges that Purchaser
has received, read and understood the Plan and the Option Agreement and agrees
to abide by and be bound by their terms and conditions.
4. Rights as Shareholder. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 12 of the
Plan.
5. Tax Consultation. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.
6. Entire Agreement; Governing Law. The Plan and Option Agreement are
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser's interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.
Submitted by: Accepted by:
PURCHASER MICRO LINEAR CORPORATION
__________________________________ By: _______________________________
Signature
__________________________________ Title: ____________________________
Print Name
Date Received
Address: Address:
EXHIBIT 4.2
MICRO LINEAR CORPORATION
1991 STOCK OPTION PLAN
(as amended through May 28, 1997)
I. Purposes of the Plan. The purposes of this Stock Option Plan are:
o to attract and retain the best available personnel for
positions of substantial responsibility,
o to provide additional incentive to Employees and Consultants,
and
o to promote the success of the Company's business.
Options granted under the Plan may be Incentive Stock Options or Nonstatutory
Stock Options, as determined by the Administrator at the time of grant. Stock
Purchase Rights may also be granted under the Plan.
I. Definitions. As used herein, the following definitions shall apply:
(1) "Administrator" means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the
Plan.
(1) "Applicable Laws" means the legal requirements relating to
the administration of stock option plans under state corporate and securities
laws and the Code.
(1) "Board" means the Board of Directors of the Company.
(1) "Code" means the Internal Revenue Code of 1986, as amended.
(1) "Committee" means a Committee appointed by the Board in
accordance with Section 4 of the Plan.
(1) "Common Stock" means the Common Stock of the Company.
(1) "Company" means Micro Linear Corporation, a California
corporation.
(1) "Consultant" means any person, including an advisor, engaged
by the Company or a Parent or Subsidiary to render services and who is
compensated for such services, provided that the term "Consultant" shall not
include Directors who are paid only a director's fee by the Company or who are
not compensated by the Company for their services as Directors.
(1) "Continuous Status as an Employee or Consultant" means the
employment or consulting relationship is not interrupted or terminated by
the Company, any Parent or Subsidiary. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of: (i) any leave of
absence approved by the Board, including sick leave, military leave, or any
other personal leave; provided, however, that for purposes of Incentive Stock
Options, any such leave may not exceed ninety (90) days, unless reemployment
upon the expiration of such leave is guaranteed by contract (including certain
Company policies) or statute; or (ii) transfers between locations of the Company
or between the Company, its Parent, its Subsidiaries or its successor.
(1) "Director" means a member of the Board.
(1) "Disability" means total and permanent disability as
defined in Section 22(e)(3) of the Code.
(1) "Employee" means any person, including Officers and
Directors, employed by the Company or any Parent or Subsidiary of the
Company. Neither service as a Director nor payment of a director's fee by the
Company shall be sufficient to constitute "employment" by the Company.
(1) "Exchange Act" means the Securities Exchange Act of 1934,
as amended.
(1) "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
Nasdaq National Market of the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") System, the Fair Market Value of a Share of
Common Stock shall be the closing sales price for such stock (or the closing
bid, if no sales were reported) as quoted on such system or exchange (or the
exchange with the greatest volume of trading in Common Stock) on the last market
trading day prior to the day of determination, as reported in the Wall Street
Journal or such other source as the Administrator deems reliable;
(ii) If the Common Stock is quoted on the NASDAQ
System (but not on the Nasdaq National Market thereof) or is regularly
quoted by a recognized securities dealer but selling prices are not reported,
the Fair Market Value of a Share of Common Stock shall be the mean between the
high bid and high asked prices for the Common Stock on the last market trading
day prior to the day of determination, as reported in the Wall Street Journal or
such other source as the Administrator deems reliable;
(iii) In the absence of an established market for the
Common Stock, the Fair Market Value shall be determined in good faith by
the Administrator.
(1) "Fully Diluted Shares" means the number of Shares
outstanding as of January 1 of each year assuming
(i) conversion of all securities and other instruments convertible
into Common Stock and (ii) exercise of all outstanding options, warrants,
and other instruments exercisable for Common Stock or preferred stock of the
Company.
(1) "Incentive Stock Option" means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of
the Code and the regulations promulgated thereunder.
(1) "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
(1) "Notice of Grant" means a written notice evidencing
certain terms and conditions of an individual Option or Stock Purchase Right
grant. The Notice of Grant is part of the Option Agreement.
(1) "Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(1) "Option" means a stock option granted pursuant to the Plan.
(1) "Option Agreement" means a written agreement between the
Company and an Optionee evidencing the terms and conditions of an individual
Option grant. The Option Agreement is subject to the terms and conditions of the
Plan.
(1) "Option Exchange Program" means a program whereby
outstanding options are surrendered in exchange for options with a lower
exercise price.
(1) "Optioned Stock" means the Common Stock subject
to an Option or Stock Purchase Right.
(1) "Optionee" means an Employee or Consultant or who holds an
outstanding Option or Stock Purchase Right.
(1) "Parent" means a "parent corporation", whether now or
hereafter existing, as defined in Section 424(e) of the Code.
(1) "Plan" means this Micro Linear Corporation 1991 Stock
Option Plan as amended from time to time.
(1) "Restricted Stock" means shares of Common Stock acquired
pursuant to a grant of Stock Purchase Rights under Section 11 below.
(1) "Restricted Stock Purchase Agreement" means a written
agreement between the Company and the Optionee evidencing the terms and
restrictions applying to stock purchased under a Stock Purchase Right. The
Restricted Stock Purchase Agreement is subject to the terms and conditions of
the Plan and the Notice of Grant.
(1) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised
with respect to the Plan.
(1) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.
(1) "Stock Purchase Right" means the right to purchase Common
Stock pursuant to Section 11 of the Plan, as evidenced by a Notice of
Grant.
(1) "Subsidiary" means a "subsidiary corporation", whether now
or hereafter existing, as defined in Section 424(f) of the Code.
I. Stock Subject to the Plan. Subject to the provisions of
Section 13 of the Plan, the maximum aggregate number of Shares which may be
optioned and sold under the Plan is 3,864,000 Shares of Common Stock plus an
annual increase on each of January 1, 1998 and January 1, 1999 equal to the
lesser of (i) 750,000 shares or (ii) 4% percent of the Fully Diluted Shares. The
Shares may be authorized, but unissued, or reacquired Common Stock. However,
should the Company reacquire Shares which were issued pursuant to the exercise
of an Option or Stock Purchase Right, such Shares shall not become available for
future grant under the Plan.
If an Option or Stock Purchase Right expires or becomes
unexercisable without having been exercised in full, the unpurchased Shares
which were subject thereto shall become available for future grant under the
Plan (unless the Plan has terminated); provided, however, that Shares that have
actually been issued under the Plan, whether upon exercise of an Option or
Right, shall not be returned to the Plan and shall not become available for
future distribution under the Plan, except that if Shares of Restricted Stock
are repurchased by the Company at their original purchase price, and the
original purchaser of such Shares did not receive any benefits of ownership of
such Shares, such Shares shall become available for future grant under the Plan.
For purposes of the preceding sentence, voting rights shall not be considered a
benefit of Share ownership.
I. Administration of the Plan.
(1) Procedure.
1. Multiple Administrative Bodies.
The Plan may be administered by different Committees with respect to
different groups of Service Providers.
1. Section 162(m). To the extent that
the Administrator determines it to be desirable to qualify Options granted
hereunder as "performance-based compensation" within the meaning of Section
162(m) of the Code, the Plan shall be administered by a Committee of two or more
"outside directors" within the meaning of Section 162(m) of the Code.
1. Rule 16b-3. To the extent
desirable to qualify transactions hereunder as exempt under Rule 16b-3, the
transactions contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.
1. Other Administration. Other than
as provided above, the Plan shall be administered by (A) the Board or (B) a
Committee, which committee shall be constituted to satisfy Applicable Laws.
(b) Powers of the Administrator. Subject to the provisions of
the Plan, and in the case of a Committee, subject to the specific duties
delegated by the Board to such Committee, the Administrator shall have the
authority, in its discretion:
(a) to determine the Fair Market Value
of the Common Stock, in accordance with Section 2(n) of the Plan;
(a) to select the Consultants and
Employees to whom Options and Stock Purchase Rights may be granted
hereunder;
(a) to determine whether and to what
extent Options and Stock Purchase Rights or any combination thereof, are
granted hereunder;
(a) to determine the number of shares
of Common Stock to be covered by each Option and Stock Purchase Right
granted hereunder;
(a) to approve forms of agreement for
use under the Plan;
(a) to determine the terms and
conditions, not inconsistent with the terms of the Plan, of any award
granted hereunder. Such terms and conditions include, but are not limited to,
the exercise price, the time or times when Options or Stock Purchase Rights may
be exercised (which may be based on performance criteria), and any restriction
or limitation, or any waiver of forfeiture restrictions regarding any Option or
Stock Purchase Right or the shares of Common Stock relating thereto, based in
each case on such factors as the Administrator, in its sole discretion, shall
determine;
(b) to reduce the exercise price of any
Option or Stock Purchase Right to the then current Fair Market Value if the
Fair Market Value of the Common Stock covered by such Option or Stock Purchase
Right shall have declined since the date the Option was granted;
(a) to construe and interpret the terms
of the Plan;
(a) to prescribe, amend and rescind
rules and regulations relating to the Plan, including rules and regulations
relating to sub-plans established for the purpose of qualifying for preferred
tax treatment under foreign tax laws;
(a) to modify or amend each Option or
Stock Purchase Right (subject to Section 15(c) of the Plan), including the
discretionary authority to extend the post-termination exercisability period of
Options longer than is otherwise provided for in the Plan;
(a) to authorize any person to execute
on behalf of the Company any instrument required to effect the grant of an
Option or Stock Purchase Right previously granted by the Administrator;
(a) to allow Optionees to satisfy
withholding tax obligations by electing to have the Company withhold from
the Shares to be issued upon exercise of an Option or Stock Purchase Right that
number of Shares having a Fair Market Value equal to the amount required to be
withheld. The Fair Market Value of the Shares to be withheld shall be determined
on the date that the amount of tax to be withheld is to be determined. All
elections by an Optionee to have Shares withheld for this purpose shall be made
in such form and under such conditions as the Administrator may deem necessary
or advisable;
(a) to institute an Option Exchange Program;
(a) to determine the terms and restrictions
applicable to Options and Stock Purchase Rights and any Restricted Stock;
and
(a) to make all other determinations deemed
necessary or advisable for administering the Plan.
(c) Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options or Stock Purchase Rights.
I. Eligibility. Nonstatutory Stock Options and Stock Purchase
Rights may be granted to Employees and Consultants. Incentive Stock Options may
be granted only to Employees. If otherwise eligible, an Employee or Consultant
who has been granted an Option or Stock Purchase Right may be granted additional
Options or Stock Purchase Rights.
I. Limitations.
(1) Each Option shall be designated in the Notice of Grant as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designations, to the extent that the aggregate Fair Market
Value:
(i) of Shares subject to an Optionee's incentive
stock options granted by the Company, any Parent or Subsidiary, which
(ii) become exercisable for the first time during any
calendar year (under all plans of the
Company or any Parent or Subsidiary)
exceeds $100,000, such excess Options shall be treated as Nonstatutory Stock
Options. For purposes of this Section 6(a), incentive stock options shall be
taken into account in the order in which they were granted, and the Fair Market
Value of the Shares shall be determined as of the time of grant.
(1) Neither the Plan nor any Option or Stock
Purchase Right shall confer upon an Optionee any right with respect to
continuing the Optionee's employment or consulting relationship with the
Company, nor shall they interfere in any way with the Optionee's right or the
Company's right to terminate such employment or consulting relationship at any
time, with or without cause.
(1) The following limitations shall apply to
grants of Options and Stock Purchase Rights to Employees:
(i) No Employee shall be granted, in any fiscal
year of the Company, Options and Stock Purchase Rights to purchase more
than 250,000 Shares.
(ii) The foregoing limitations shall be adjusted
proportionately in connection with any change in
the Company's capitalization as described in Section 13 hereof.
(iii) If an Option or Stock Purchase Right is
canceled in the same fiscal year of the Company in which it was granted
(other than in connection with a transaction described in Section 13 hereof, the
canceled Option or Stock Purchase Right will be counted against the limit set
forth in Section 6(c)(i) hereof. For this purpose, if the exercise price of an
Option or Stock Purchase Right is reduced, the transaction will be treated as a
cancellation of the Option or Stock Purchase Right and the grant of a new Option
or Stock Purchase Right.
I. Term of Plan. Subject to Section 19 of the Plan, the Plan
shall become effective upon the earlier to occur of its adoption by the Board or
its approval by the shareholders of the Company as described in Section 19 of
the Plan. It shall continue in effect for a term of ten (10) years unless
terminated earlier under Section 15 of the Plan.
II. Term of Option. The term of each Option shall be stated in
the Notice of Grant; provided, however, that the term shall be ten (10) years
from the date of grant or such shorter term as may be provided in the Notice of
Grant. However, in the case of an Incentive Stock Option granted to an Optionee
who, at the time the Incentive Stock Option is granted, owns stock representing
more than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary, the term of the Incentive Stock Option
shall be five (5) years from the date of grant or such shorter term as may be
provided in the Notice of Grant.
I. Option Exercise Price and Consideration.
(1) Exercise Price. The per share exercise
price for the Shares to be issued pursuant to exercise of an Option shall
be determined by the Administrator, subject to the following:
(a) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the
time the Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall be no less than 110% of the
Fair Market Value per Share on the date of grant.
(B) granted to any Employee other than an
Employee described in paragraph (A)immediately above, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.
(a) In the case of a Nonstatutory Stock
Option, the per Share exercise price shall be determined by the
Administrator. In the case of a Nonstatutory Stock Option intended to qualify as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the per Share exercise price shall be no less than 100% of the Fair Market
Value per Share on the date of grant.
(a) Notwithstanding the foregoing, Options may
be granted with a per Share exercise price of less than 100% of the Fair
Market Value per Share on the date of grant pursuant to a merger or other
corporate transaction.
(1) Waiting Period and Exercise Dates. At the
time an Option is granted, the Administrator shall fix the period within
which the Option may be exercised and shall determine any conditions which must
be satisfied before the Option may be exercised. In so doing, the Administrator
may specify that an Option may not be exercised until the completion of a
service period.
(1) Form of Consideration. The Administrator shall determine
the acceptable form of consideration for exercising an Option, including the
method of payment. In the case of an Incentive Stock Option, the Administrator
shall determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:
(i) cash,
(ii) check,
(iii) promissory note,
(iv) other Shares which (A) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for
more than six months on the date of surrender, and (B) have a Fair Market Value
on the date of surrender equal to the aggregate exercise price of the Shares as
to which said Option shall be exercised,
(v) delivery of a properly executed exercise notice
together with irrevocable instructions to a broker to promptly deliver to
the Company the amount of sale or loan proceeds required to pay the exercise
price,
(vi) a reduction in the amount of any Company
liability to the Optionee, including any liability attributable to the
Optionee's participation in any Company-sponsored deferred compensation program
or arrangement;
(vii) any combination of the foregoing methods of
payment, or
(viii) such other consideration and method of payment
for the issuance of Shares to the extent permitted by Applicable Laws.
I. Exercise of Option.
(1) Procedure for Exercise; Rights as a
Shareholder. Any Option granted hereunder shall be exercisable according to
the terms of the Plan and at such times and under such conditions as determined
by the Administrator and set forth in the Option Agreement.
An Option may not be exercised for a fraction of a
Share.
An Option shall be deemed exercised when the Company
receives: (i) written notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the stock certificate evidencing such Shares is issued (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company), no right to vote or receive dividends or any
other rights as a shareholder shall exist with respect to the Optioned Stock,
notwithstanding the exercise of the Option. The Company shall issue (or cause to
be issued) such stock certificate promptly after the Option is exercised. No
adjustment will be made for a dividend or other right for which the record date
is prior to the date the stock certificate is issued, except as provided in
Section 13 of the Plan.
Exercising an Option in any manner shall decrease the
number of Shares thereafter available, both for purposes of the Plan and
for sale under the Option, by the number of Shares as to which the Option is
exercised.
(1) Termination of Employment or Consulting
Relationship. In the event an Optionee's Continuous Status as an Employee
or Consultant terminates (other than upon the Optionee's death or Disability),
the Optionee may exercise his or her Option, but only within such period of time
as is determined by the Administrator, and only to the extent that the Optionee
was entitled to exercise it at the date of termination (but in no event later
than the expiration of the term of such Option as set forth in the Notice of
Grant). In the case of an Incentive Stock Option, the Administrator shall
determine such period of time (in no event to exceed ninety (90) days from the
date of termination) when the Option is granted. If, at the date of termination,
the Optionee is not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to the Plan. If,
after termination, the Optionee does not exercise his or her Option within the
time specified by the Administrator, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan.
Notwithstanding the above, in the event of an Optionee's
change in status from Consultant or Director to Employee or Employee or Director
to Consultant, an Optionee's Continuous Status as a Director or Consultant shall
not automatically terminate solely as a result of such change in status.
However, in such event, an Incentive Stock Option held by the Optionee shall
cease to be treated as an Incentive Stock Option and shall be treated for tax
purposes as a Nonstatutory Stock Option three months and one day following such
change of status from an Employee to a Consultant.
(1) Disability of Optionee. In the event an
Optionee's Continuous Status as an Employee or Consultant terminates as a
result of the Optionee's Disability, the Optionee may exercise his or her
Option, but only within twelve (12) months from the date of such termination,
and only to the extent that the Optionee was entitled to exercise it at the date
of such termination (but in no event later than the expiration of the term of
such Option as set forth in the Notice of Grant). If, at the date of
termination, the Optionee is not entitled to exercise his or her entire Option,
the Shares covered by the unexercisable portion of the Option shall revert to
the Plan. If, after termination, the Optionee does not exercise his or her
Option within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
(1) Death of Optionee. In the event of the
death of an Optionee, the Option may be exercised, at any time within
twelve (12) months following the date of death (but in no event later than the
expiration of the term of such Option as set forth in the Notice of Grant), by
the Optionee's estate or by a person who acquired the right to exercise the
Option by bequest or inheritance, but only to the extent the Optionee was
entitled to exercise the Option at the date of death. If, at the time of death,
the Optionee was not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to the Plan. If,
after death, the Optionee's estate or a person who acquired the right to
exercise the Option by bequest or inheritance does not exercise the Option
within the time specified herein, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan.
I. Stock Purchase Rights.
(a) Rights to Purchase. Stock Purchase Rights may be issued
either alone, in addition to, or in tandem with other awards granted under the
Plan and/or cash awards made outside of the Plan. After the Administrator
determines that it will offer Stock Purchase Rights under the Plan, it shall
advise the offeree in writing, by means of a Notice of Grant, of the terms,
conditions and restrictions related to the offer, including the number of Shares
that the offeree shall be entitled to purchase, the price to be paid, and the
time within which the offeree must accept such offer, which shall in no event
exceed six (6) months from the date upon which the Administrator made the
determination to grant the Stock Purchase Right. The offer shall be accepted by
execution of a Restricted Stock Purchase Agreement in the form determined by the
Administrator.
(b) Repurchase Option. Unless the Administrator determines
otherwise, the Restricted Stock Purchase Agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
the purchaser's employment with the Company for any reason (including death or
Disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock purchase agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company. The repurchase option shall lapse at a rate determined by the
Administrator.
(c) Other Provisions. The Restricted Stock Purchase March 25,
1997 Agreement shall contain such other terms, provisions and conditions not
inconsistent with the Plan as may be determined by the Administrator in its sole
discretion. In addition, the provisions of Restricted Stock Purchase Agreements
need not be the same with respect to each purchaser.
(d) Rights as a Shareholder. Once the Stock Purchase Right is
exercised, the purchaser shall have the rights equivalent to those of a
shareholder, and shall be a shareholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 13
of the Plan.
I. Non-Transferability of Options and Stock Purchase Rights.
Unless determined otherwise by the Administrator, an Option or Stock Purchase
Right may not be sold, pledged, assigned, hypothecated, transferred, or disposed
of in any manner other than by will or by the laws of descent or distribution
and may be exercised, during the lifetime of the Optionee, only by the Optionee.
If the Administrator makes an Option or Stock Purchase Right transferable, such
Option or Stock Purchase Right shall contain such additional terms and
conditions as the Administrator deems appropriate.
I. Adjustments Upon Changes in Capitalization,
Dissolution or Merger.
(1) Changes in Capitalization. Subject to any required action
by the shareholders of the Company, the number of shares of Common Stock covered
by each outstanding Option and Stock Purchase Right, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or which have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option or Stock
Purchase Right.
(1) Dissolution or Liquidation. In the event
of the proposed dissolution or liquidation of the
Company, to the extent that an Option or Stock Purchase Right has not been
previously exercised, it will terminate immediately prior to the consummation of
such proposed action. The Board may, in the exercise of its sole discretion in
such instances, declare that any Option or Stock Purchase Right shall terminate
as of a date fixed by the Board and give each Optionee the right to exercise his
or her Option or Stock Purchase Right as to all or any part of the Optioned
Stock, including Shares as to which the Option or Stock Purchase Right would not
otherwise be exercisable.
(1) Merger or Asset Sale. In the event of a
merger of the Company with or into another corporation, or the sale of
substantially all of the assets of the Company, each outstanding Option and
Stock Purchase Right may be assumed or an equivalent option or right may be
substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event the successor corporation does not assume or
substitute the Options and Stock Purchase Rights, then the Administrator shall
provide for the Optionee to fully vest in and have the right to exercise the
Option or Stock Purchase Right as to all or a portion of the Optioned Stock,
including Shares as to which it would not otherwise be vested or exercisable. If
the Administrator makes an Option or Stock Purchase Right exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the
Administrator shall notify the Optionee that the Option or Stock Purchase Right
shall be fully vested and exercisable for a period of fifteen (15) days from the
date of such notice, and the Option or Stock Purchase Right will terminate upon
the expiration of such period. For the purposes of this paragraph, the Option or
Stock Purchase Right shall be considered assumed if, following the merger or
sale of assets, the option or right confers the right to purchase, for each
Share of Optioned Stock subject to the Option or Stock Purchase Right
immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) received in the merger or sale of
assets by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the type
of consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the merger or sale of
assets was not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option or Stock
Purchase Right, for each Share of Optioned Stock subject to the Option or Stock
Purchase Right, to be solely common stock of the successor corporation or its
Parent equal in fair market value to the per share consideration received by
holders of Common Stock in the merger or sale of assets.
I. Date of Grant. The date of grant of an Option or Stock
Purchase Right shall be, for all purposes, the date on which the Administrator
makes the determination granting such Option or Stock Purchase Right, or such
other later date as is determined by the Administrator. Notice of the
determination shall be provided to each Optionee within a reasonable time after
the date of such grant.
I. Amendment and Termination of the Plan.
(1) Amendment and Termination. The Board may
at any time amend, alter, suspend or terminate the Plan.
(1) Shareholder Approval. The Company shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Sections 162(m) and 422 of the Code (or any successor rule or statute or
other applicable law, rule or regulation, including the requirements of any
exchange or quotation system on which the Common Stock is listed or quoted).
Such shareholder approval, if required, shall be obtained in such a manner and
to such a degree as is required by the applicable law, rule or regulation.
(1) Effect of Amendment or Termination. No
amendment, alteration, suspension or termination of the Plan shall impair
the rights of any Optionee, unless mutually agreed otherwise between the
Optionee and the Administrator, which agreement must be in writing and signed by
the Optionee and the Company.
II. Conditions Upon Issuance of Shares.
(1) Legal Compliance. Shares shall not be issued pursuant to
the exercise of an Option or Stock Purchase Right unless the exercise of such
Option or Stock Purchase Right and the issuance and delivery of such Shares
shall comply with all relevant provisions of law, including, without limitation,
the Securities Act of 1933, as amended, the Exchange Act, the rules and
regulations promulgated thereunder, and the requirements of any stock exchange
or quotation system upon which the Shares may then be listed or quoted, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.
(1) Investment Representations. As a condition to the exercise
of an Option or Stock Purchase Right, the Company may require the person
exercising such Option or Stock Purchase Right to represent and warrant at the
time of any such exercise that the Shares are being purchased only for
investment and without any present intention to sell or distribute such Shares
if, in the opinion of counsel for the Company, such a representation is
required.
I. Liability of Company.
(1) Inability to Obtain Authority. The inability of the
Company to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by the Company's counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, shall relieve the Company of any
liability in respect of the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.
(1) Grants Exceeding Allotted Shares. If the Optioned Stock
covered by an Option or Stock Purchase Right exceeds, as of the date of grant,
the number of Shares which may be issued under the Plan without additional
shareholder approval, such Option or Stock Purchase shall be void with respect
to such excess Optioned Stock, unless shareholder approval of an amendment
sufficiently increasing the number of Shares subject to the Plan is timely
obtained in accordance with Section 15(b) of the Plan.
I. Reservation of Shares. The Company, during the term of this
Plan, will at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.
I. Shareholder Approval. Continuance of the Plan shall be
subject to approval by the shareholders of the Company within twelve (12) months
before or after the date the Plan is adopted. Such shareholder approval shall be
obtained in the manner and to the degree required under applicable federal and
state law.
EXHIBIT 4.3
MICRO LINEAR CORPORATION
1994 EMPLOYEE STOCK PURCHASE PLAN
(as amended through May 28, 1997)
The following constitute the provisions of the 1994 Employee Stock
Purchase Plan of Micro Linear Corporation.
I. Purpose. The purpose of the Plan is to provide employees of
the Company and its Designated Subsidiaries with an opportunity to purchase
Common Stock of the Company through accumulated payroll deductions. It is the
intention of the Company to have the Plan qualify as an "Employee Stock Purchase
Plan" under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.
I. Definitions.
A. "Board" shall mean the Board of Directors
of the Company.
A. "Code" shall mean the Internal Revenue Code
of 1986, as amended.
A. "Common Stock" shall mean the Common Stock
of the Company.
A. "Company" shall mean Micro Linear
Corporation, a California corporation and any Designated Subsidiary of the
Company.
A. "Compensation" shall mean all base straight
time gross earnings including payments for overtime, shift premium,
incentive compensation, incentive payments, commissions or other compensation
but excluding bonuses.
A. "Designated Subsidiaries" shall mean the
Subsidiaries which have been designated by the Board from time to time in
its sole discretion as eligible to participate in the Plan.
A. "Employee" shall mean any individual who is
an employee of the Company for tax purposes whose customary employment with
the Company is at least twenty (20) hours per week and more than five (5) months
in any calendar year. For purposes of the Plan, the employment relationship
shall be treated as continuing intact while the individual is on sick leave or
other leave of absence approved by the Company. Where the period of leave
exceeds 90 days and the individual's right to reemployment is not guaranteed
either by statute or by contract, the employment relationship will be deemed to
have terminated on the 91st day of such leave.
B. "Enrollment Date" shall mean the first day
of each Offering Period.
A. "Exercise Date" shall mean the last day of
each Offering Period.
A. "Fair Market Value" shall mean, as of any
date, the value of Common Stock determined as follows:
1. If the Common Stock is listed on
any established stock exchange or a national market system, including
without limitation the Nasdaq National Market of the National Association of
Securities Dealers, Inc. Automated Quotation ("NASDAQ") System, its Fair Market
Value shall be the closing sale price for the Common Stock (or the mean of the
closing bid and asked prices, if no sales were reported), as quoted on such
exchange (or the exchange with the greatest volume of trading in Common Stock)
or system on the date of such determination, as reported in The Wall Street
Journal or such other source as the Board deems reliable, or;
1. If the Common Stock is quoted on
the NASDAQ System (but not on the Nasdaq National Market thereof) or is
regularly quoted by a recognized securities dealer but selling prices are not
reported, its Fair Market Value shall be the mean of the closing bid and asked
prices for the Common Stock on the date of such determination, as reported in
The Wall Street Journal or such other source as the Board deems reliable, or;
1. Notwithstanding paragraphs (1) and
(2), in the case of an Offering Period commencing substantially concurrent
with the Company's initial public offering, the Fair Market Value may be
determined by the Board to be equal to the initial price to the public of shares
of Common Stock in such offering; or
1. In the absence of an established
market for the Common Stock, the Fair Market Value thereof shall be
determined in good faith by the Board.
A. "Offering Period" shall mean a period of
approximately six (6) months, commencing on the first Trading Day of the
Company's first fiscal quarter and terminating on the last Trading Day of the
Company's second fiscal quarter, or commencing on the first Trading Day of the
Company's third fiscal quarter and terminating on the last Trading Day of the
Company's fourth fiscal quarter, during which an option granted pursuant to the
Plan may be exercised. The duration of Offering Periods may be changed pursuant
to Section 4 of this Plan. Notwithstanding the foregoing, in the event the
Company shall effect an initial public offering of Common Stock, the Board may
determine to commence an Offering Period substantially concurrent with the
public offering, such Offering Period to continue until the next succeeding May
31 or November 30 as the Board may determine.
A. "Plan" shall mean this Employee Stock
Purchase Plan.
A. "Purchase Price" shall mean an amount
equal to 85% of the Fair Market Value of a share of Common Stock on the
Enrollment Date or on the Exercise Date, whichever is lower.
A. "Reserves" shall mean the number of shares
of Common Stock covered by each option under the Plan which have not yet
been exercised and the number of shares of Common Stock which have been
authorized for issuance under the Plan but not yet placed under option.
A. "Subsidiary" shall mean a corporation,
domestic or foreign, of which not less than 50% of the voting shares are
held by the Company or a Subsidiary, whether or not such corporation now exists
or is hereafter organized or acquired by the Company or a Subsidiary.
A. "Trading Day" shall mean a day on which national
stock exchanges and The NASDAQ Stock Market are open for trading.
I. Eligibility.
A. Any Employee (as defined in Section 2(g)),
who shall be employed by the Company on a given Enrollment Date shall be
eligible to participate in the Plan.
A. Any provisions of the Plan to the contrary
notwithstanding, no Employee shall be granted an option under the Plan (i)
to the extent, immediately after the grant, such Employee (or any other person
whose stock would be attributed to such Employee pursuant to Section 424(d) of
the Code) would own capital stock of the Company and/or hold outstanding options
to purchase such stock possessing five percent (5%) or more of the total
combined voting power or value of all classes of the capital stock of the
Company or of any Subsidiary, or (ii) to the extent his or her rights to
purchase stock under all employee stock purchase plans of the Company and its
subsidiaries to accrue at a rate which exceeds Twenty-Five Thousand Dollars
($25,000) worth of stock (determined at the fair market value of the shares at
the time such option is granted) for each calendar year in which such option is
outstanding at any time.
I. Offering Periods. The Plan shall be implemented by
consecutive Offering Periods with a new Offering Period commencing on the first
Trading Day of the Company's first and third fiscal quarters, or on such other
date as the Board shall determine, and continuing thereafter until terminated in
accordance with Section 19 hereof. The Board shall have the power to change the
duration of Offering Periods (including the commencement dates thereof) with
respect to future offerings without shareholder approval if such change is
announced at least fifteen (15) days prior to the scheduled beginning of the
first Offering Period to be affected thereafter.
I. Participation.
A. An eligible Employee may become a
participant in the Plan by completing a subscription agreement authorizing
payroll deductions in the form of Exhibit A to this Plan and filing it with the
Company's payroll office prior to the applicable Enrollment Date.
A. Payroll deductions for a participant shall
commence on the first payroll following the Enrollment Date and shall end
on the last payroll in the Offering Period to which such authorization is
applicable, unless sooner terminated by the participant as provided in Section
10.
I. Payroll Deductions.
(a) At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay day
during the Offering Period in an amount not exceeding ten percent (10%) of the
Compensation which he or she receives on each pay day during the Offering
Period.
(b) All payroll deductions made for a participant shall be
credited to his or her account under the Plan and will be withheld in whole
percentages only. A participant may not make any additional payments into such
account.
(c) A participant may discontinue his or her participation in
the Plan as provided in Section 10 hereof, or may increase or decrease the rate
of his or her payroll deductions during the Offering Period by completing or
filing with the Company a new subscription agreement authorizing a change in
payroll deduction rate. The Board may, in its discretion, limit the number of
participation rate changes during any Offering Period. The change in rate shall
be effective with the first full payroll period following five (5) business days
after the Company's receipt of the new subscription agreement unless the Company
elects to process a given change in participation more quickly. A participant's
subscription agreement shall remain in effect for successive Offering Periods
unless terminated as provided in Section 10 hereof.
(d) Notwithstanding the foregoing, to the extent necessary to
comply with Section 423(b)(8) of the Code and Section 3(b) hereof, a
participant's payroll deductions may be decreased to 0% at such time during any
Offering Period which is scheduled to end during the current calendar year (the
"Current Offering Period") that the aggregate of all payroll deductions which
were previously used to purchase stock under the Plan in a prior Offering Period
which ended during that calendar year plus all payroll deductions accumulated
with respect to the Current Offering Period equal $21,250. Payroll deductions
shall recommence at the rate provided in such participant's subscription
agreement at the beginning of the first Offering Period which is scheduled to
end in the following calendar year, unless terminated by the participant as
provided in Section 10 hereof.
(e) At the time the option is exercised, in whole or in part,
or at the time some or all of the Company's Common Stock issued under the Plan
is disposed of, the participant must make adequate provision for the Company's
federal, state, or other tax withholding obligations, if any, which arise upon
the exercise of the option or the disposition of the Common Stock. At any time,
the Company may, but will not be obligated to, withhold from the participant's
compensation the amount necessary for the Company to meet applicable withholding
obligations, including any withholding required to make available to the Company
any tax deductions or benefits attributable to sale or early disposition of
Common Stock by the Employee.
I. Grant of Option. On the Enrollment Date of each Offering
Period, each eligible Employee participating in such Offering Period shall be
granted an option to purchase on the Exercise Date of such Offering Period (at
the applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated
prior to such Exercise Date and retained in the Participant's account as of the
Exercise Date by the applicable Purchase Price; provided that in no event shall
an Employee be permitted to purchase during each Offering Period more than a
number of Shares determined by dividing $12,500 by the Fair Market Value of a
share of the Company's Common Stock on the Enrollment Date, and provided further
that such purchase shall be subject to the limitations set forth in Sections
3(b) and 12 hereof. Exercise of the option shall occur as provided in Section 8
hereof, unless the participant has withdrawn pursuant to Section 10 hereof, and
shall expire on the last day of the Offering Period.
I. Exercise of Option. Unless a participant withdraws from the
Plan as provided in Section 10 below, his or her option for the purchase of
shares shall be exercised automatically on the Exercise Date, and the maximum
number of full shares subject to option shall be purchased for such participant
at the applicable Purchase Price with the accumulated payroll deductions in his
or her account. No fractional shares shall be purchased; any payroll deductions
accumulated in a participant's account which are not sufficient to purchase a
full share shall be retained in the participant' s account for the subsequent
Offering Period, subject to earlier withdrawal by the participant as provided in
Section 10 hereof. Any other monies left over in a participant's account after
the Exercise Date shall be returned to the participant. During a participant's
lifetime, a participant's option to purchase shares hereunder is exercisable
only by him or her.
I. Delivery. As promptly as practicable after each Exercise
Date on which a purchase of shares occurs, the Company shall arrange the
delivery to each participant, as appropriate, of a certificate representing the
shares purchased upon exercise of his or her option.
I. Withdrawal; Termination of Employment.
A. A participant may withdraw all but not less
than all the payroll deductions credited to his or her account and not yet
used to exercise his or her option under the Plan at any time by giving written
notice to the Company in the form of Exhibit B to this Plan. All of the
participant's payroll deductions credited to his or her account will be paid to
such participant promptly after receipt of notice of withdrawal and such
participant's option for the Offering Period will be automatically terminated,
and no further payroll deductions for the purchase of shares will be made during
the Offering Period. If a participant withdraws from an Offering Period, payroll
deductions will not resume at the beginning of the succeeding Offering Period
unless the participant delivers to the Company a new subscription agreement.
A. Upon a participant's ceasing to be an
Employee (as defined in Section 2(g) hereof) for any reason, he or she will
be deemed to have elected to withdraw from the Plan and the payroll deductions
credited to such participant's account during the Offering Period but not yet
used to exercise the option will be returned to such participant or, in the case
of his or her death, to the person or persons entitled thereto under Section 14
hereof, and such participant's option will be automatically terminated. The
preceding sentence notwithstanding, a participant who receives payment in lieu
of notice of termination of employment shall be treated as continuing to be an
Employee for the participant's customary number of hours per week of employment
during the period in which the participant is subject to such payment in lieu of
notice.
A. A participant's withdrawal from an Offering
Period will not have any effect upon his or her eligibility to participate
in any similar plan which may hereafter be adopted by the Company or in
succeeding Offering Periods which commence after the termination of the Offering
Period from which the participant withdraws.
I. Interest. No interest shall accrue on the payroll
deductions of a participant in the Plan.
I. Stock.
A. The maximum number of shares of the
Company's Common Stock which shall be made available for sale under the
Plan shall be 455,000 shares, subject to adjustment upon changes in
capitalization of the Company as provided in Section 18 hereof. If on a given
Exercise Date the number of shares with respect to which options are to be
exercised exceeds the number of shares then available under the Plan, the
Company shall make a pro rata allocation of the shares remaining available for
purchase in as uniform a manner as shall be practicable and as it shall
determine to be equitable.
A. The participant will have no interest or
voting right in shares covered by his option until such option has been
exercised.
A. Shares to be delivered to a participant
under the Plan will be registered in the name of the participant or in the
name of the participant and his or her spouse.
I. Administration.
A. Administrative Body. The Plan shall be
administered by the Board or a committee of members of the Board appointed
by the Board. The Board or its committee shall have full and exclusive
discretionary authority to construe, interpret and apply the terms of the Plan,
to determine eligibility and to adjudicate all disputed claims filed under the
Plan. Every finding, decision and determination made by the Board or its
committee shall, to the full extent permitted by law, be final and binding upon
all parties.
I. Designation of Beneficiary.
A. A participant may file a written
designation of a beneficiary who is to receive any shares and cash, if any,
from the participant's account under the Plan in the event of such participant's
death subsequent to an Exercise Date on which the option is exercised but prior
to delivery to such participant of such shares and cash. In addition, a
participant may file a written designation of a beneficiary who is to receive
any cash from the participant's account under the Plan in the event of such
participant's death prior to exercise of the option.
A. Such designation of beneficiary may be
changed by the participant at any time by written notice. In the event of
the death of a participant and in the absence of a beneficiary validly
designated under the Plan who is living at the time of such participant's death,
the Company shall deliver such shares and/or cash to the executor or
administrator of the estate of the participant, or if no such executor or
administrator has been appointed (to the knowledge of the Company), the Company,
in its discretion, may deliver such shares and/or cash to the spouse or to any
one or more dependents or relatives of the participant, or if no spouse,
dependent or relative is known to the Company, then to such other person as the
Company may designate.
I. Transferability. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 14 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.
I. Use of Funds. All payroll deductions received or held by
the Company under the Plan may be used by the Company for any corporate purpose,
and the Company shall not be obligated to segregate such payroll deductions.
I. Reports. Individual accounts will be maintained for each
participant in the Plan. Statements of account will be given to participating
Employees at least annually, which statements will set forth the amounts of
payroll deductions, the Purchase Price, the number of shares purchased and the
remaining cash balance, if any.
I. Adjustments Upon Changes in Capitalization.
(a) Changes in Capitalization. Subject to any required action
by the shareholders of the Company, the Reserves as well as the price per share
of Common Stock covered by each option under the Plan which has not yet been
exercised shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be deemed
to have been "effected without receipt of consideration." Such adjustment shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issue by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an option.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Offering Period will terminate
immediately prior to the consummation of such proposed action, unless otherwise
provided by the Board.
(c) Merger or Asset Sale. In the event of a proposed sale of
all or substantially all of the assets of the Company, or the merger of the
Company with or into another corporation, each option under the Plan shall be
assumed or an equivalent option shall be substituted by such successor
corporation or a parent or subsidiary of such successor corporation. In the
event the successor corporation refuses to assume or substitute for the options,
then the Board shall shorten the Offering Period then in progress by setting a
new Exercise Date (the "New Exercise Date"). If the Board shortens the Offering
Period then in progress in lieu of assumption or substitution in the event of a
merger or sale of assets, the Board shall notify each participant in writing, at
least ten (10) business days prior to the New Exercise Date, that the Exercise
Date for his option has been changed to the New Exercise Date and that his
option will be exercised automatically on the New Exercise Date, unless prior to
such date he has withdrawn from the Offering Period as provided in Section 10
hereof. For purposes of this paragraph, an option granted under the Plan shall
be deemed to be assumed if, following the sale of assets or merger, the option
confers the right to purchase, for each share of option stock subject to the
option immediately prior to the sale of assets or merger, the consideration
(whether stock, cash or other securities or property) received in the sale of
assets or merger by holders of Common Stock for each share of Common Stock held
on the effective date of the transaction (and if such holders were offered a
choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding shares of Common Stock); provided, however, that if
such consideration received in the sale of assets or merger was not solely
common stock of the successor corporation or its parent (as defined in Section
424(e) of the Code), the Board may, with the consent of the successor
corporation, provide for the consideration to be received upon exercise of the
option to be solely common stock of the successor corporation or its parent
equal in fair market value to the per share consideration received by holders of
Common Stock and the sale of assets or merger.
The Board may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the price
per share of Common Stock covered by each outstanding option, in the event the
Company effects one or more reorganizations, recapitalizations, rights offerings
or other increases or reductions of shares of its outstanding Common Stock, and
in the event of the Company being consolidated with or merged into any other
corporation.
I. Amendment or Termination.
A. The Board of Directors of the Company may
at any time and for any reason terminate or amend the Plan. Except as
provided in Section 18, no such termination can affect options previously
granted, provided that an Offering Period may be terminated by the Board of
Directors on any Exercise Date if the Board determines that the termination of
the Plan is in the best interests of the Company and its shareholders. Except as
provided in Section 18 hereof, no amendment may make any change in any option
theretofore granted which adversely affects the rights of any participant. To
the extent necessary to comply with Section 423 of the Code (or any successor
rule or provision or any other applicable law or regulation), the Company shall
obtain shareholder approval in such a manner and to such a degree as required.
A. Without shareholder consent and without
regard to whether any participant rights may be considered to have been
"adversely affected," the Board (or its committee) shall be entitled to change
the Offering Periods, limit the frequency and/or number of changes in the amount
withheld during an Offering Period, establish the exchange ratio applicable to
amounts withheld in a currency other than U.S. dollars, permit payroll
withholding in excess of the amount designated by a participant in order to
adjust for delays or mistakes in the Company's processing of properly completed
withholding elections, establish reasonable waiting and adjustment periods
and/or accounting and crediting procedures to ensure that amounts applied toward
the purchase of Common Stock for each participant properly correspond with
amounts withheld from the participant's Compensation, and establish such other
limitations or procedures as the Board (or its committee) determines in its sole
discretion advisable which are consistent with the Plan.
I. Notices. All notices or other communications by a
participant to the Company under or in connection with the Plan shall be deemed
to have been duly given when received in the form specified by the Company at
the location, or by the person, designated by the Company for the receipt
thereof.
I. Conditions Upon Issuance of Shares. Shares shall not be
issued with respect to an option unless the exercise of such option and the
issuance and delivery of such shares pursuant thereto shall comply with all
applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules
and regulations promulgated thereunder, and the requirements of any stock
exchange upon which the shares may then be listed, and shall be further subject
to the approval of counsel for the Company with respect to such compliance.
As a condition to the exercise of an option, the Company may
require the person exercising such option to represent and warrant at the time
of any such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.
I. Term of Plan. The Plan shall become effective upon the
earlier to occur of its adoption by the Board of Directors or its approval by
the shareholders of the Company. It shall continue in effect for a term of ten
(10) years unless sooner terminated under Section 19 hereof.
<PAGE>
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EXHIBIT A
MICRO LINEAR CORPORATION
1994 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_____ Original Application Enrollment Date: ___________
_____ Decrease [Change] in Payroll Deduction Rate
_____ Change of Beneficiary(ies)
1. hereby elects to participate in the Micro Linear Corporation 1994
Employee Stock Purchase Plan (the "Employee Stock Purchase Plan") and
subscribes to purchase shares of the Company's Common Stock in
accordance with this Subscription Agreement and the Employee Stock
Purchase Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount
of ____% of my Compensation on each payday (not to exceed 10%) during
the Offering Period in accordance with the Employee Stock Purchase
Plan. (Please note that no fractional percentages are permitted.)
3. I understand that said payroll deductions shall be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Employee Stock Purchase Plan. I
understand that if I do not withdraw from an Offering Period, any
accumulated payroll deductions will be used to automatically exercise
my option.
4. I have received a copy of the complete "Employee Stock Purchase Plan."
I understand that my participation in the Employee Stock Purchase Plan
is in all respects subject to the terms of the Plan. I understand that
the grant of the option by the Company under this Subscription
Agreement is subject to obtaining shareholder approval of the Employee
Stock Purchase Plan.
5. Shares purchased for me under the Employee Stock Purchase Plan should
be issued in the name(s) of (Employee or Employee and Spouse Only): .
6. I understand that if I dispose of any shares received by me pursuant
to the Plan within 2 years after the Enrollment Date (the first day of the
Offering Period during which I purchased such shares), I will be treated for
federal income tax purposes as having received ordinary income at the time of
such disposition in an amount equal to the excess of the fair market value of
the shares at the time such shares were purchased by me over the price which I
paid for the shares. I hereby agree to notify the Company in writing within 30
days after the date of any disposition of shares and I will make adequate
provision for Federal, state or other tax withholding obligations, if any, which
arise upon the disposition of the Common Stock. The Company may, but will not be
obligated to, withhold from my compensation the amount necessary to meet any
applicable withholding obligation including any withholding necessary to make
available to the Company any tax deductions or benefits attributable to sale or
early disposition of Common Stock by me. If I dispose of such shares at any time
after the expiration of the 2-year holding period, I understand that I will be
treated for federal income tax purposes as having received income only at the
time of such disposition, and that such income will be taxed as ordinary income
only to the extent of an amount equal to the lesser of (1) the excess of the
fair market value of the shares at the time of such disposition over the
purchase price which I paid for the shares, or (2) 15% of the fair market value
of the shares on the first day of the Offering Period. The remainder of the
gain, if any, recognized on such disposition will be taxed as capital gain
7. I hereby agree to be bound by the terms of the Employee Stock Purchase
Plan. The effectiveness of this Subscription Agreement is dependent
upon my eligibility to participate in the Employee Stock Purchase Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Employee Stock Purchase Plan:
NAME: (Please print) _____________________________________________
(First) (Middle) (Last)
- ------------------------- -------------------------------------
Relationship
-------------------------------------
(Address)
NAME: (Please print) __________________________________________________
(First) (Middle) (Last)
- ------------------------- -------------------------------------
Relationship
-------------------------------------
(Address)
Employee's Social
Security Number: ___________________________________
Employee's Address: __________________________________
----------------------------------
----------------------------------
I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.
Dated: ___________________ __________________________________
Signature of Employee
----------------------------------
Spouse's Signature (If beneficiary
other than spouse)
<PAGE>
EXHIBIT B
MICRO LINEAR CORPORATION
1994 EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
The undersigned participant in the Offering Period of the Micro Linear
Corporation 1994 Employee Stock Purchase Plan which began on ___________ 19__
(the "Enrollment Date") hereby notifies the Company that he or she hereby
withdraws from the Offering Period. He or she hereby directs the Company to pay
to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The
undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated. The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period and the undersigned shall be eligible to participate
in succeeding Offering Periods only by delivering to the Company a new
Subscription Agreement.
Name and Address of Participant:
-------------------------------
-------------------------------
-------------------------------
Signature:
-------------------------------
Date: _________________________
EXHIBIT 5.1
May 18, 1998
Micro Linear Corporation
2092 Concourse Drive
San Jose, California 95131
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by you
with the Securities and Exchange Commission on or about May 19, 1998, in
connection with the registration under the Securities Act of 1933, as amended,
of (i) 600,000 shares of Common Stock (the "NSO Shares") to be issued under your
Nonstatutory Stock Option Plan (the "NSO Plan"), (ii) 1,409,885 shares of Common
Stock (the "Option Shares") to be issued under your 1991 Stock Option Plan (the
"Option Plan") and (iii) 175,000 shares of Common Stock (the "ESPP Shares") to
be issued under your 1994 Employee Stock Purchase Plan (the "ESPP").
As your legal counsel, we have examined the proceedings taken and are
familiar with the proceedings proposed to be taken by you in connection with the
sale and issuance of the NSO Shares, the Option Shares (collectively, the
"Shares"). It is our opinion that the Shares, when issued and sold in the manner
referred to in the NSO Plan, the OPtion Plan and the ESPP (collectively, the
"Plans"), and pursuant to the agreements which accompany the Plans, will be
legally and validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to said Registration
Statement and further consent to the use of our name wherever appearing in said
Registration Statement and any amendments thereto.
Sincerely,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
/s/ WILSON SONSINI GOODRICH & ROSATI
EXHIBIT 23.1
Consent of Independant Accountants
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 21, 1998 appearing on page 29
of Micro Linear Corporation's Annual Report on Form 10-k for the year ended
December 28, 1997.
/s/ PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
San Jose, California
May 15, 1998
EXHIBIT 23.2
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the Nonstatutory Stock Option Plan, the 1991 Stock
Option Plan and the 1994 Employee Stock Purchase Plan of Micro Linear
Corporation of our report dated January 20, 1998, with respect to the financial
statements and schedule of Micro Linear Corporation included in the Annual
Report (Form 10-K) for the year ended December 28, 1997.
ERNST & YOUNG LLP
San Jose, California
May 18, 1998
