<PAGE>
Exhibit 99.3
FIRST AMENDMENT
TO
THE 1996 EMPLOYEE STOCK PURCHASE PLAN
OF
OVERLAND DATA, INC.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
I. PURPOSE................................................................................................1
2. DEFINITIONS............................................................................................1
3. ELIGIBILITY............................................................................................3
4. PARTICIPATION..........................................................................................3
5. OFFERING...............................................................................................4
6. PURCHASE OF STOCK......................................................................................5
7. PAYMENT AND DELIVERY...................................................................................6
8. RECAPITULATION.........................................................................................6
9. MERGER, LIQUIDATION, OTHER CORPORATION TRANSACTIONS....................................................7
10. TRANSFERABILITY........................................................................................7
11. AMENDMENT OR TERMINATION OF THE PLAN...................................................................7
12. ADMINISTRATION.........................................................................................8
13. COMMITTEE RULES FOR FOREIGN JURISDICTIONS..............................................................8
14. SECURITIES LAWS REQUIREMENTS...........................................................................8
15. GOVERNMENT REGULATIONS.................................................................................9
16. NO ENLARGEMENT OF EMPLOYEE RIGHTS......................................................................9
17. GOVERNING LAW..........................................................................................9
18. EFFECTIVE DATE.........................................................................................9
</TABLE>
-i-
<PAGE>
FIRST AMENDMENT
TO
THE 1996 EMPLOYEE STOCK PURCHASE PLAN
OF
OVERLAND DATA, INC.
1. PURPOSE.
The purpose of this Plan is to provide an opportunity for Employees of
Overland Data, Inc. (the "Corporation") and its Designated Subsidiaries, to
purchase Common Stock of the Corporation and thereby to have an additional
incentive to contribute to the prosperity of the Corporation. It is the
intention of the Corporation that the Plan qualify as an "Employee Stock
Purchase Plan" under Section 423 of the Internal Revenue Code of 1986, as
amended, although the Corporation makes no undertaking nor representation to
maintain such qualification.
2. DEFINITIONS.
(a) "BOARD" shall mean the Board of Directors of the Corporation.
(b) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
(c) "COMMITTEE" shall mean the committee appointed by the Board in
accordance with Section 12 of the Plan.
(d) "COMMON STOCK" shall mean the Common Stock of the Corporation, or
any stock into which such Common Stock may be converted.
(e) "COMPENSATION" shall mean an Employee's wages or salary and other
amounts payable to an Employee on account of personal services rendered by the
Employee to the Corporation or a Designated Subsidiary and which are reportable
as wages or other compensation on the Employee's Form W-2, plus pre-tax
contributions of the Employee under a cash or deferred arrangement (401(k) plan)
or cafeteria plan maintained by the Corporation or a Designated Subsidiary, but
excluding, however, (1) non-cash fringe benefits, (2) special payments as
determined by the Committee (e.g., moving expenses, unused vacation, severance
pay), (3) income from the exercise of stock options or other stock purchases and
(4) any other items of Compensation as determined by the Committee.
(f) "CORPORATION" shall mean Overland Data, Inc., a California
corporation.
(g) "DESIGNATED SUBSIDIARY" shall mean a Subsidiary which has been
designated by the Board as eligible to participate in the Plan.
(h) "EMPLOYEE" shall mean an individual classified as an employee
(within the meaning of Code Section 3401(c) and the regulations thereunder) by
the Corporation or a Designated Subsidiary on the Corporation payroll records
during the relevant participation period.
-1-
<PAGE>
(i) "ENTRY DATE" shall mean the first day of each Option Period.
(j) "EXERCISE DATE" shall mean the last business day of each Exercise
Period.
(k) "EXERCISE PERIOD" shall mean a three-month, six-month or other
period as determined by the Board. The first Exercise Period during an Option
Period shall commence on the first day of such Option Period. Subsequent
Exercise Periods, if any, shall run consecutively after the termination of the
preceding Exercise Period. The last Exercise Period in an Option Period shall
terminate on the last day of such Option Period.
(l) "FAIR MARKET VALUE" shall mean the value of one (1) share of Common
Stock on the relevant date, determined as follows:
(1) If the shares are traded on an exchange, the reported "closing
price" on the next preceding trading day;
(2) If the shares are traded over-the-counter on the NASDAQ System
or on the NASDAQ National Market System, the mean between the highest bid and
the highest asked prices on said System on the next preceding trading day; and
(3) If neither (1) nor (2) applies, the fair market value as
determined by the Committee in good faith. Such determination shall be
conclusive and binding on all persons.
(m) "OPTION PERIOD" shall mean a period of up to twenty-seven (27)
months as determined by the Committee. The Board may determine that the Option
Period and the Exercise Period are the same.
(n) "PARTICIPANT" shall mean a participant in the Plan as described in
Section 4 of the Plan.
(o) "PLAN" shall mean this employee stock purchase plan.
(p) "SHAREHOLDER" shall mean a record holder of shares entitled to vote
shares of Common Stock under the Corporation's by-laws.
(q) "SUBSIDIARY" shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation, as described in Code Section 424(f).
-2-
<PAGE>
3. ELIGIBILITY.
Any Employee regularly employed on a full-time basis by the Corporation
or by any Designated Subsidiary on an Entry Date shall be eligible to
participate in the Plan with respect to the Option Period commencing on such
Entry Date, provided that the Committee may establish administrative rules
requiring that employment commence some minimum period (e.g., one pay period)
prior to an Entry Date to be eligible to participate with respect to that Entry
Date and provided further that (1) the Board may extend eligibility to part-time
Employees pursuant to criteria and procedures established by the Committee and
(2) the Board may impose an eligibility period on participation of up to two
years with respect to participation on any prospective Entry Date. The Board may
also determine that a designated group of highly compensated Employees (e.g.,
Employees subject to Section 16(b) of the Securities Exchange Act of 1934) are
ineligible to participate in the Plan. An Employee shall be considered employed
on a full-time basis unless his or her customary employment is less than 20
hours per week or five months per year. No Employee may participate in the Plan
if immediately after an option is granted the Employee owns or is considered to
own (within the meaning of Code Section 424(d)), shares of stock, including
stock which the Employee may purchase by conversion of convertible securities or
under outstanding options granted by the Corporation, possessing five percent
(5%) or more of the total combined voting power or value of all classes of stock
of the Corporation or of any of its Subsidiaries. All Employees who participate
in the Plan shall have the same rights and privileges under the Plan except for
differences which may be mandated by local law and which are consistent with
Code Section 423(b)(5). The Board may impose restrictions on eligibility and
participation of Employees who are officers and directors to facilitate
compliance with federal or state securities laws or foreign laws.
4. PARTICIPATION.
4.1 An Employee who is eligible to participate in the Plan in
accordance with Section 3 may become a Participant by filing, on a date
prescribed by the Committee prior to an applicable Entry Date, a completed
payroll deduction authorization and Plan enrollment form provided by the
Corporation. An eligible Employee may authorize payroll deductions at the rate
of any whole percentage of the Employee's Compensation, not to exceed fifteen
percent (15%) of the Employee's Compensation, or such lesser percentage as
specified by the Committee as applied to an Entry Date or Option Period. All
payroll deductions may be held by the Corporation and commingled with its other
corporate funds. No interest shall be paid or credited to the Participant with
respect to such payroll deductions except where required by local law as
determined by the Committee. A separate bookkeeping account for each Participant
shall be maintained by the Corporation under the Plan and the amount of each
Participant's payroll deductions shall be credited to such account. A
Participant may not make any additional payments into such account.
4.2 Under procedures established by the Committee, a Participant may
suspend or discontinue participation in the Plan at any time during an Exercise
Period by completing and filing a new payroll deduction authorization and Plan
enrollment form with the Corporation. A Participant may increase or decrease his
or her rate of payroll deductions only effective on an Entry Date by filing a
new payroll deduction authorization and Plan enrollment form. If a new
-3-
<PAGE>
payroll deduction authorization and Plan enrollment form is not filed with the
Corporation, the rate of payroll deductions shall continue at the originally
elected rate throughout the Option Period unless the Board determines to change
the permissible rate.
If a Participant suspends participation during an Exercise Period, his
or her accumulated payroll deductions will remain in the Plan for purchase of
shares as specified in Section 6 on the following Exercise Date, but the
Participant will not again participate until he or she completes a new payroll
deduction authorization and Plan enrollment form. The Committee may establish
rules limiting the frequency with which Participants may suspend and resume
payroll deductions under the Plan and may impose a waiting period on
Participants wishing to resume suspended payroll deductions. If a Participant
discontinues participation in the Plan, the amount credited to the Participant's
individual account shall be paid to the Participant without interest (except
where required by local law). In the event any Participant terminates employment
with the Corporation or any Subsidiary for any reason (including death) prior to
the expiration of an Option Period, the Participant's participation in the Plan
shall terminate and all amounts credited to the Participant's account shall be
paid to the Participant or the Participant's estate without interest (except
where required by local law). Whether a termination of employment has occurred
shall be determined by the Committee. The Committee may also establish rules
regarding when leaves of absence or change of employment status (e.g., from
full-time to part-time) will be considered to be a termination of employment,
and the Committee may establish termination of employment procedures for this
Plan which are independent of similar rules established under other benefit
plans of the Corporation and its Subsidiaries.
In the event of a Participant's death, any accumulated payroll
deductions will be paid, without interest, to the estate of the Participant.
5. OFFERING.
5.1 The maximum number of shares of Common Stock which may be issued
pursuant to the Plan shall be 500,000 shares. The Board may designate any amount
of available shares for offering for any Option Period determined pursuant to
Section 5.2.
5.2 Each Option Period, Entry Date and Exercise Period shall be
determined by the Board. The Board shall have the power to change the duration
of future Option Periods or future Exercise Periods, and to determine whether or
not to have overlapping Option Periods, with respect to any prospective
offering, without shareholder approval, and without regard to the expectations
of any Participants.
5.3 With respect to each Option Period, each eligible Employee who has
elected to participate as provided in Section 4.1 shall be granted an option to
purchase that number of shares of Common Stock which may be purchased with the
payroll deductions accumulated on behalf of such Employee (assuming payroll
deductions at a rate of 15% of Compensation) during each Exercise Period within
such Option Period at the purchase price specified in Section 5.4 below;
provided, however, (1) in no event shall the Employee be entitled to accrue
rights to purchase shares under the Plan (and all other employee stock purchase
plans, as defined in Code Section
-4-
<PAGE>
423, of the Corporation and its subsidiaries) at a rate which exceeds $25,000 of
the Fair Market Value of such stock (determined at the time the option is
granted) for any calendar year in which such option is outstanding at any time,
and (2) the maximum shares subject to any option shall in no event exceed 1,500.
5.4 The option price under each option shall be the lower of: (i) a
percentage (not less than eighty-five percent (85%)) established by the Board
("Designated Percentage") of the Fair Market Value of the Common Stock on the
Entry Date on which an option is granted, or (ii) the Designated Percentage of
the Fair Market Value on the Exercise Date on which the Common Stock is
purchased. The Board may change the Designated Percentage with respect to any
future Option Period, but not below eighty-five percent (85%).
5.5 If the total number of shares of Common Stock for which options
granted under the Plan are exercisable exceeds the maximum number of shares
offered on any Entry Date, the number of shares which may be purchased under
options granted on the Entry Date shall be reduced on a pro rata basis in as
nearly a uniform manner as shall be practicable and equitable. In this event,
payroll deductions shall also be reduced or refunded accordingly. If an
Employee's payroll deductions during any Exercise Period exceeds the purchase
price for the maximum number of shares permitted to be purchased under Section
5.3, the excess shall be refunded to the Participant without interest (except
where otherwise required by local law).
5.6 In the event that the Fair Market Value of the Corporation's Common
Stock is lower on the first day of an Exercise Period within an Option Period
(subsequent "Reassessment Date") than it was on the Entry Date for such Option
Period, all Employees participating in the Plan on the Reassessment Date shall
be deemed to have relinquished the unexercised portion of the option granted on
the Entry Date and to have enrolled in and received a new option commencing on
such Reassessment Date, unless the Board has determined not to permit
overlapping Option Periods or to restrict such transfers to lower price Option
Periods.
6. PURCHASE OF STOCK.
Upon the expiration of each Exercise Period, a Participant's option
shall be exercised automatically for the purchase of that number of full shares
of Common Stock which the accumulated payroll deductions credited to the
Participant's account at that time shall purchase at the applicable price
specified in Section 5.4.
-5-
<PAGE>
7. PAYMENT AND DELIVERY.
Upon the exercise of an option, the Corporation shall deliver to the
Participant the Common Stock purchased and the balance of any amount of payroll
deductions credited to the Participant's account not used for the purchase. The
Board may permit or require that shares be deposited directly with a broker
designated by the Participant (or a broker selected by the Committee) or to a
designated agent of the Company, and the Committee may utilize electronic or
automated methods of share transfer. The Board may require that shares be
retained with such broker or agent for a designated period of time (and may
restrict dispositions during that period) and/or may establish other procedures
to permit tracking of disqualifying dispositions of such shares or to restrict
transfer of such shares. To the extent the unused cash balance represents a
fractional share, the unused cash balance credited to the Participant's account
shall be carried over to the next Exercise Period, if the Participant is also a
Participant in the Plan at that time or refunded to the Participant, as
determined by the Committee. The Corporation shall retain the amount of payroll
deductions used to purchase Common Stock as full payment for the Common Stock
and the Common Stock shall then be fully paid and non-assessable. No Participant
shall have any voting, dividend, or other stockholder rights with respect to
shares subject to any option granted under the Plan until the option has been
exercised and shares issued.
8. RECAPITALIZATION.
If after the grant of an option, but prior to the purchase of Common
Stock under the option, there is any increase or decrease in the number of
outstanding shares of Common Stock because of a stock split, stock dividend,
combination or recapitalization of shares subject to options, the number of
shares to be purchased pursuant to an option, the share limit of Section 5.3 and
the maximum number of shares specified in Section 5.1 shall be proportionately
increased or decreased, the terms relating to the purchase price with respect to
the option shall be appropriately adjusted by the Board, and the Board shall
take any further actions which, in the exercise of its discretion, may be
necessary or appropriate under the circumstances.
The Board, if it so determines in the exercise of its sole discretion,
also may adjust the number of shares specified in Section 5.1, as well as the
price per share of Common Stock covered by each outstanding option and the
maximum number of shares subject to any individual option, in the event the
Corporation effects one or more reorganizations, recapitalizations, spin-offs,
split-ups, rights offerings or reductions of shares of its outstanding Common
Stock.
The Board's determinations under this Section 8 shall be conclusive and
binding on all parties.
-6-
<PAGE>
9. MERGER, LIQUIDATION, OTHER CORPORATION TRANSACTIONS.
In the event of the proposed liquidation or dissolution of the
Corporation, the Option Period will terminate immediately prior to the
consummation of such proposed transaction, unless otherwise provided by the
Board in its sole discretion, and all outstanding options shall automatically
terminate and the amounts of all payroll deductions will be refunded without
interest to the Participants.
In the event of a proposed sale of all or substantially all of the
assets of the Corporation, or the merger or consolidation of the Corporation
with or into another corporation, then in the sole discretion of the Board, (1)
each option shall be assumed or an equivalent option shall be substituted by the
successor corporation or parent or subsidiary of such successor corporation, (2)
a date established by the Board on or before the date of consummation of such
merger, consolidation or sale shall be treated as an Exercise Date, and all
outstanding options shall be deemed exercisable on such date or (3) all
outstanding options shall terminate and the accumulated payroll deductions shall
be returned to the Participants.
10. TRANSFERABILITY.
Options granted to Participants may not be voluntarily or involuntarily
assigned, transferred, pledged, or otherwise disposed of in any way, and any
attempted assignment, transfer, pledge, or other disposition shall be null and
void and without effect. If a Participant in any manner attempts to transfer,
assign or otherwise encumber his or her rights or interest under the Plan, other
than as permitted by the Code, such act shall be treated as an election by the
participant to discontinue participation in the Plan pursuant to Section 4.2.
11. AMENDMENT OR TERMINATION OF THE PLAN.
11.1 The Plan shall continue until, January 31, 2007 unless previously
terminated in accordance with Section 11.2.
11.2 The Board may, in its sole discretion, insofar as permitted by
law, terminate or suspend the Plan, or revise or amend it in any respect
whatsoever, except that, without approval of the shareholders, no such revision
or amendment shall:
(a) materially increase the number of shares subject to the Plan,
other than an adjustment under Section 8 of the Plan;
(b) materially modify the requirements as to eligibility for
participation in the Plan, except as otherwise specified in this Plan;
(c) materially increase the benefits accruing to Participants;
(d) reduce the purchase price specified in Section 5.4, except as
specified in Section 8;
-7-
<PAGE>
(e) extend the term of the Plan beyond the date specified in
Section 11.1; or
(f) amend this Section 11.2 to defeat its purpose.
12. ADMINISTRATION.
The Board shall appoint a Committee consisting of at least two members
who will serve for such period of time as the Board may specify and who may be
removed by the Board at any time. The Committee will have the authority and
responsibility for the day-to-day administration of the Plan, the authority and
responsibility specifically provided in this Plan and any additional duties,
responsibility and authority delegated to the Committee by the Board, which may
include any of the functions assigned to the Board in this Plan. The Committee
shall have full power and authority to promulgate any rules and regulations
which it deems necessary for the proper administration of the Plan, to interpret
the provisions and supervise the administration of the Plan, and to take all
action in connection with administration of the Plan as it deems necessary or
advisable, consistent with the delegation from the Board. Decisions of the Board
and the Committee shall be final and binding upon all participants. Any decision
reduced to writing and signed by a majority of the members of the Committee
shall be fully effective as if it had been made at a meeting of the Committee
duly held. The Corporation shall pay all expenses incurred in the administration
of the Plan. No Board or Committee member shall be liable for any action or
determination made in good faith with respect to the Plan or any option granted
thereunder.
13. COMMITTEE RULES FOR FOREIGN JURISDICTIONS.
The Committee may adopt rules or procedures relating to the operation
and administration of the Plan in non-United States jurisdictions to accommodate
the specific requirements of local laws and procedures. Without limiting the
generality of the foregoing, the Committee is specifically authorized to adopt
rules and procedures regarding handling of payroll deductions, payment of
interest, conversion of local currency, withholding procedures and handling of
stock certificates which vary with local requirements.
14. SECURITIES LAWS REQUIREMENTS.
The Corporation shall not be under any obligation to issue Common Stock
upon the exercise of any option unless and until the Corporation has determined
that: (i) it and the Participant have taken all actions required to register the
Common Stock under the Securities Act of 1933, or to perfect an exemption from
the registration requirements thereof; (ii) any applicable listing requirement
of any stock exchange on which the Common Stock is listed has been satisfied;
and (iii) all other applicable provisions of state, federal and applicable
foreign law have been satisfied.
-8-
<PAGE>
15. GOVERNMENTAL REGULATIONS.
This Plan and the Corporation's obligation to sell and deliver shares
of its stock under the Plan shall be subject to the approval of any governmental
authority required in connection with the Plan or the authorization, issuance,
sale, or delivery of stock hereunder.
16. NO ENLARGEMENT OF EMPLOYEE RIGHTS.
Nothing contained in this Plan shall be deemed to give any Employee the
right to be retained in the employ of the Corporation or any Designated
Subsidiary or to interfere with the right of the Corporation or Designated
Subsidiary to discharge any Employee at any time.
17. GOVERNING LAW.
This Plan shall be governed by California law.
18. EFFECTIVE DATE.
This Plan shall be effective on the first date in 1997 in which the
Common Stock trades on the NASDAQ System or NASDAQ National Market System,
subject to approval of the shareholders of the Corporation within 12 months of
its adoption by the Board of Directors.
-9-
