<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
SPECTRALINK CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
-----------------------------------------------------------------------
(4) Date Filed:
-----------------------------------------------------------------------
<PAGE> 2
SPECTRALINK CORPORATION
5755 CENTRAL AVENUE
BOULDER, COLORADO 80301
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Dear SpectraLink Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
SpectraLink Corporation to be held at the Hotel Boulderado, 2115 13th Street,
Boulder, Colorado, on Wednesday, May 24, 2000 at 10:00 a.m. local time, for the
following purposes:
1. To elect a Board of Directors to serve until the next Annual Meeting of
Stockholders and until their successors are elected and qualified.
2. To approve the adoption of the Company's 2000 Stock Option Plan.
3. To approve the amendment to the Employee Stock Purchase Plan.
4. To ratify the selection of Arthur Andersen LLP, independent public
accountants, as auditors for the Company for the fiscal year ending
December 31, 2000.
5. To transact such other business as may properly come before the meeting
or any adjournment thereof.
All stockholders are welcome to attend the meeting, although only stockholders
of record at the close of business on March 8, 2000, will be entitled to notice
of and to vote at the meeting.
Shares can be voted at the meeting only if the holder is present or represented
by proxy. Even if you plan to attend the meeting, you are urged to date and sign
the enclosed proxy and return it promptly in the accompanying envelope so that
the presence of a quorum will be assured. The giving of a proxy does not affect
your right to vote in person if you attend the meeting. However, if you intend
to vote at the annual meeting and your shares are held of record by a broker,
bank or other nominee, you must bring a letter to the annual meeting from the
broker, bank or nominee, which confirms beneficial ownership. Additionally, in
order to vote at the annual meeting, you must obtain a proxy issued in your name
from the record holder.
By Order of the Board of Directors,
Nancy K. Hamilton
Secretary
March 23, 2000
1
<PAGE> 3
SPECTRALINK CORPORATION
5755 CENTRAL AVENUE
BOULDER, COLORADO 80301
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 24, 2000
THIS PROXY IS SOLICITED IN BEHALF OF THE BOARD OF DIRECTORS.
This statement is furnished in connection with the solicitation of proxies from
holders of the outstanding shares of Common Stock of SpectraLink entitled to
vote at the Annual Meeting of Stockholders. This Proxy Statement and enclosed
proxy are being mailed to stockholders on or about April 7, 2000. A copy of the
Company's Annual Report for 1999 is being mailed to all stockholders with this
Proxy Statement. The Annual Report is not to be regarded as proxy soliciting
material or as a communication by means of which any solicitation is to be made.
The Company's Board has fixed the close of business on March 8, 2000, as the
record date for the determination of stockholders entitled to notice of, and to
vote at, the meeting. On that date, there were outstanding and entitled to vote
19,261,592 shares of Common Stock. Holders of Common Stock are entitled to one
vote for each share of record held on the record date with respect to matters on
which the holder is entitled to vote.
The presence, in person or by proxy, of a majority of the outstanding shares of
Common Stock as of the record date constitutes a quorum and is required in order
for the Company to conduct business at the Annual Meeting. The majority being
present, the election of each nominee for Director requires a plurality of the
votes cast. The affirmative vote of the holders of a majority of the shares of
Common Stock represented in person or by proxy at the Annual Meeting is required
to approve or ratify the other proposals described below. Abstentions and broker
non-votes are counted towards a quorum. Abstentions are counted in the
tabulations of the votes cast, but broker non-votes on any proposal are not
considered to be represented at the meeting as to such proposal and therefore
are not counted for purposes of determining whether a proposal has been
approved.
2
<PAGE> 4
PROPOSAL 1: ELECTION OF DIRECTORS
Pursuant to the Company's Bylaws, the Board has fixed the number of directors at
four, effective as of the annual meeting. The Directors are to be elected by the
holders of the Company's Common Stock, to serve until the next Annual Meeting
and until their successors are elected and qualified. Unless instructions to the
contrary are received, proxies received in response to this solicitation will be
voted in favor of the nominees listed below. If any nominee should become
unavailable for election, the shares represented by the enclosed proxy will be
voted for such substitute nominee as may be proposed by the Board.
<TABLE>
<CAPTION>
<S> <C> <C>
====================================== ================ ========================================================
Name, Age and Principal Occupation During Past Five Years and Other
Position with the Company Director Since Directorships
- -------------------------------------- ---------------- --------------------------------------------------------
Bruce M. Holland, 48 1990 President and Chief Executive Officer of SpectraLink
President, Chief Executive Officer and since 1990; Director of Exabyte Corporation until May
Director 1998.
- -------------------------------------- ---------------- --------------------------------------------------------
Carl D. Carman, 63 1990 General Partner in Hill, Carman Ventures since 1989;
Director Director of Symantec Corporation.
- -------------------------------------- ---------------- --------------------------------------------------------
Burton J. McMurtry, 65 1990 General Partner of various limited partnerships that, in
Director turn, are general partners of various Technology Venture
Investors venture capital partnerships since 1980;
Director of Intuit, Inc.
- -------------------------------------- ---------------- --------------------------------------------------------
Anthony V. Carollo, Jr., 58 1998 Chairman and Chief Executive Officer of Syntellect
Director Corporation since 1997; President of Fujitsu Business
Communication Systems from 1991 to 1998; Director of
Marshall & Lisley Trust Company of Arizona.
====================================== ================ ========================================================
</TABLE>
The Board of Directors met six times during 1999. Each director attended at
least 66% of the meetings of the Board of Directors, as well as of the meetings
of the Committees on which he served.
COMMITTEES
The Board of Directors has Audit and Compensation Committees.
The Compensation Committee consists of Messrs. Carman and McMurtry. The
Compensation Committee recommends to the Board of Directors the compensation to
be paid to employees of the Company and administrators the Company's various
employee benefits plans. The Committee met once during 1999.
The Audit Committee confers periodically with management and the Company's
independent public accountant in connection with the preparation of financial
statements and audits thereof and the maintenance of proper financial records
and controls. The Audit Committee makes recommendations to the Board of
Directors with respect to the foregoing and brings to the attention of the Board
any criticism and recommendation that the independent public accountants or the
Audit Committee itself may suggest. The Audit Committee consists of Messrs.
Carman and Myers. The Committee met five times during 1999. Mr. Gib Myers has
been a director of the Company since 1990, but is not standing for re-election.
3
<PAGE> 5
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
<S> <C>
============================================= ============================================================================
Name, Age and Position with the Company Principal Occupation During Past Five Years
----------------------------------------------------------------------------
- ---------------------------------------------
Bruce M. Holland, 48 President and Chief Executive Officer of SpectraLink since 1990.
President, Chief Executive Officer
- --------------------------------------------- ----------------------------------------------------------------------------
Nancy K. Hamilton, 47 Vice President of Finance and Administration, Chief Financial Officer and
Vice President of Finance & Administration, Secretary of SpectraLink since 1999. Chief Financial Officer and Senior
Chief Financial Officer Vice President of SCC Communications from 1993 to 1999.
- --------------------------------------------- ----------------------------------------------------------------------------
Gary L. Bliss, 49 Vice President of Engineering of SpectraLink since 1990.
Vice President of Engineering
- --------------------------------------------- ----------------------------------------------------------------------------
Michael P. Cronin, 43 Vice President of Sales and Marketing of SpectraLink since 1997; Vice
Vice President of Sales & Marketing President, North American Sales, of VTEL Corporation from 1994 to 1997.
- --------------------------------------------- ----------------------------------------------------------------------------
John H. Elms, 40 Vice President of Operations of SpectraLink since 1999. Vice President,
Vice President of Operations Americas Services and Corporate Support, of Picturetel Corporation from
1998 to 1999; Director, Asia Pacific & Japan for the Enterprise Services
Division of Picturetel Corporation from 1995 to 1997.
- --------------------------------------------- ----------------------------------------------------------------------------
E. Ronald Elswick, 56 Vice President of Operations of SpectraLink from 1991 to October 1999.
Former Vice President of Operations
============================================= ============================================================================
</TABLE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to beneficial
ownership of the Common Stock by (i) each person known by the Company to be the
beneficial owner of more than 5% of the Common Stock; (ii) each of the Company's
directors; (iii) the Company's Chief Executive Officer and each of the Executive
Officers mentioned above; and (iv) the Company's directors and executive
officers as a group. All information is given as of December 31, 1999, unless
otherwise indicated.
<TABLE>
<CAPTION>
Name and Address of Beneficial Owner Shares Beneficially Owned (1) Percentage of Outstanding Common Stock
<S> <C> <C>
Technology Venture Investors (2) 2,182,823 11.5%
2480 Sand Hill Road
Suite 101
Menlo Park, CA 94025
Mayfield VI (3) 906,991 4.8
2800 Sand Hill Road
Suite 250
Menlo Park, CA 94025
The Hill Partnership III (4) 1,300,681 6.8
885 Arapahoe Avenue
Boulder, CO 80302
Carl D. Carman (4) 1,359,137 7.1
Anthony V. Carollo, Jr. (5) 15,312 *
Burton McMurtry (2) 2,182,823 11.5
F. Gibson Myers, Jr. (3) 906,991 4.8
Bruce M. Holland (6) 2,063,837 10.8
Nancy K. Hamilton 1,641 *
Gary L. Bliss (7) 571,866 3.0
Michael P. Cronin (8) 81,249 *
John H. Elms 0 *
E. Ronald Elswick (9) 168,118 *
All directors and executive officers as a
group (10 persons) (10) 7,350,974 38.6
</TABLE>
*less than 1%
4
<PAGE> 6
(1) The persons named in this table have sole voting and investment power with
respect to all shares of Common Stock shown as beneficially owned by them,
subject to community property laws where applicable and except as indicated
in the other footnotes to this table. Beneficial ownership is determined in
accordance with the rules of the Securities and Exchange Commission. In
computing the number of shares beneficially owned by a person and the
percentage ownership of that person, shares of Common Stock subject to
options held by that person that are currently exercisable or exercisable
within 60 days are deemed outstanding. Such shares, however, are not deemed
outstanding for the purpose of computing the percentage ownership of any
other person.
(2) Consists of 576,221 shares held by Technology Venture Investors-3, L.P.,
11,143 shares held by TVI management-3, L.P. and 1,595,459 shares held by
Technology Venture Investors-IV as nominee for certain other TVI
partnerships. Mr. McMurtry, a director of the Company, is a general partner
of partnerships, which are general partners of various TVI and other
partnerships and, as such, may be deemed to share voting and investment
power with respect to such shares. Mr. McMurtry disclaims beneficial
ownership of such shares except to the extent of his interest in such
shares arising from his interests in the entities referred to herein.
(3) Consists of 30,612 shares held by Mayfield Associates and 876,379 shares
held by Mayfield VI. Mr. Myers, a director of the Company, is a general
partner of Mayfield Associates and Mayfield VI and, as such, may be deemed
to share voting and investment power with respect to such shares. Mr. Myers
disclaims beneficial ownership of such shares except to the extent of his
interest in such shares arising from his interest in the entities referred
to herein.
(4) 1,300,681 shares are held by The Hill Partnership III. Mr. Carman holds
58,456 shares. Mr. Carman, a director of the Company, is a general partner
of Hill, Carman Ventures, the general partner of The Hill Partnership III
and, as such, may be deemed to share voting and investment power with
respect to shares held by The Hill Partnership III. Mr. Carman disclaims
beneficial ownership of such shares except to the extent of his interest in
such shares arising from his interest in The Hill Partnership III.
(5) Includes 15,312 shares issuable upon exercise of options.
(6) Includes 22,000 shares held by Mr. Holland's wife as to which he disclaims
beneficial ownership. Also includes 268,749 shares issuable upon exercise
of options.
(7) Includes 160,416 shares issuable upon exercise of options.
(8) Includes 77,749 shares issuable upon exercise of options.
(9) Includes 68,228 shares issuable upon exercise of options.
(10) Includes 590,454 shares issuable upon exercise of options.
5
<PAGE> 7
PERFORMANCE GRAPH
The graph below provides an indicator of cumulative total stockholder returns
for SpectraLink as compared with the NASDAQ Stock Market (U.S.) Index and the
NASDAQ Telecommunications Stocks weighted by market value at each measurement
point.
This graph covers the period of time beginning April 26, 1996, when
SpectraLink's common shares were first traded on the NASDAQ Exchange, through
December 31, 1999.
EDGAR PRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NASDAQ
NASDAQ Stock Telecommunications
Total Return (1) SpectraLink Market (U.S.) Stocks
---------------- ----------- ------------- ------------------
<S> <C> <C> <C>
4/26/96 $ 100.00 $ 100.00 $ 100.00
12/31/96 $ 27.27 $ 108.92 $ 95.22
12/31/97 $ 29.23 $ 133.45 $ 136.25
12/31/98 $ 37.66 $ 188.06 $ 229.27
12/31/99 $ 75.32 $ 339.75 $ 399.25
</TABLE>
<TABLE>
<CAPTION>
April 26, December 31, December 31, December 31, December 31,
1996 1996 1997 1998 1999
-------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
SpectraLink $ 100.00 $ 27.27 $ 29.23 $ 37.66 $ 75.32
NASDAQ Stock
Market (U.S.) $ 100.00 $ 108.92 $ 133.45 $ 188.06 $ 339.75
NASDAQ
Communications
Stocks $ 100.00 $ 95.22 $ 136.25 $ 229.27 $ 399.25
</TABLE>
Footnote:
1) Assumes $100 invested on April 26, 1996, in SpectraLink stock, NASDAQ Stock
Market (U.S.) and NASDAQ Telecommunications Stock. No cash dividends have
been declared on SpectraLink's Common Stock.
6
<PAGE> 8
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding the compensation
earned for services rendered in all capacities to the Company for the three
fiscal years ended December 31, 1999, by the Company's Chief Executive Officer
and each of the other executive officers whose salary and bonus exceeded
$100,000 (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
Securities
Underlying
Name and Options All Other
Principal Position Year Salary ($) Bonus ($) Other ($) Granted (#) Compensation($)
- ------------------------ -------- ---------- ------------ --------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Bruce M. Holland 1999 $164,000 $ 0 $ 0 60,000 $ --
Chief Executive Officer 1998 151,488 0 324 60,000 --
and President 1997 137,394 0 323 100,000 --
Nancy K. Hamilton 1999 (1) 80,192 25,000 (2) 0 175,000 --
Vice President of
Finance &
Administration,
Chief Financial Officer
Gary L. Bliss 1999 148,999 0 0 40,000 --
Vice President of 1998 141,960 0 303 40,000 --
Engineering 1997 131,158 0 301 75,000 --
Michael P. Cronin 1999 161,999 0 1,844 40,000 446,791
Vice President of Sales 1998 154,488 26,922 11,245 20,000 --
& Marketing 1997 (3) 49,688 75,503 (4) 3,216 200,000 --
John H. Elms 1999 (5) 85,396 70,000 (4) 0 175,000 --
Vice President of
Operations
E. Ronald Elswick 1999 (6) 135,590 0 0 40,000 --
Vice President of 1998 140,615 0 774 40,000 --
Operations 1997 129,715 0 491 75,000 --
</TABLE>
(1) Ms. Hamilton began working for the Company in June 1999.
(2) Includes $25,000 signing bonus.
(3) Mr. Cronin began working for the Company in August 1997.
(4) Includes $70,000 bonus in lieu of relocation allowance.
(5) Mr. Elms began working for the Company in April 1999 and became a
corporate officer in November 1999.
(6) Mr. Elswick resigned from the Company in October 1999.
(7) Includes amounts attributable to the exercise of stock options.
7
<PAGE> 9
OPTION GRANTS
The following table contains information concerning the stock options granted
under the Company's Stock Option Plan to each of the Named Executive Officers
during the fiscal year ended December 31, 1999.
OPTION GRANTS IN THE LAST FISCAL YEAR
<TABLE>
<CAPTION>
Individual Grants
Number of Percent of Potential realizable value at
Securities Total Options Assumed Annual Rates of Stock Price
Underlying Granted to Appreciation for Option Term (2)
Options Employees in Exercise or Base Expiration
Name Granted (#)(1) Fiscal Year Price/Share Date 5% 10%
---- -------------- ------------- ---------------- ---------- -- ---
<S> <C> <C> <C> <C> <C> <C>
Bruce M. Holland 60,000 (4) 7.7 $ 4.25 02/24/07 $ 121,751 $ 291,615
Nancy K. Hamilton 82,048 (3) 10.5 4.875 06/18/07 190,975 457,417
92,952 (4) 11.9 4.875 06/18/07 216,355 518,207
Gary L. Bliss 21,667 (3) 2.8 4.25 02/24/07 43,966 105,307
18,333 (4) 2.3 4.25 02/24/07 37,201 89,103
Michael P. Cronin 11,667 (3) 1.5 4.25 02/24/07 23,675 56,705
28,333 (4) 3.6 4.25 02/24/07 57,493 137,706
John H. Elms 103,052 (3) 13.2 3.563 04/28/07 175,309 419,896
8,805 (3) 1.1 4.563 10/20/07 19,183 45,946
46,948 (4) 6.0 3.563 04/28/07 79,867 191,295
16,195 (4) 2.1 4.563 10/20/07 35,283 84,509
E. Ronald Elswick 21,667 (3) 2.8 4.25 02/24/07 43,966 105,307
18,333 (4) 2.3 4.25 02/24/07 37,201 89,103
</TABLE>
(1) All options were granted under the Company's Stock Option Plan.
Generally, options granted under the Company's Stock Option Plan become
exercisable over a four-year period (25% after the first twelve months
and 2.083% each month thereafter) and have eight-year terms, so long as
the optionee's employment with the Company continues. Incentive stock
options are granted at no less than fair market value as determined by
the Board of Directors, provided that grants to 10% stockholders have
an exercise price not less than 110% of fair market value.
Non-qualified stock options have an exercise price of not less than 85%
of fair market value.
(2) This column reflects the potential realizable value of each grant
assuming that the market value of the Company's Common Stock
appreciates at five percent or ten percent annually from the date of
grant over the term of the option. There is no assurance provided to
any executive officer or any other holder of the Company's securities
that the actual stock price appreciation over the option term will be
at the assumed five percent or ten percent levels or at any other
defined level. Unless the market price of the Common Stock does in fact
appreciate over the option term, no value will be realized from the
option grants made to the Named Executive Officers.
(3) Incentive stock option.
(4) Non-qualified stock option.
8
<PAGE> 10
OPTION EXERCISES AND HOLDINGS
The following table sets forth information concerning option exercises and
option holdings under the Company's Stock Option Plan for the fiscal year ended
December 31, 1999, with respect to the Named Executive Officers.
AGGREGATE OPTIONS EXERCISED IN THE LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
Number Number of Unexercised Options Value of Unexercised, In-the-Money
of Shares Held at December 31, 1999 Options at December 31, 1999 (2)
Acquired Value
Name on Exercise Realized ($)(1) Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Bruce M. Holland 0 N/A 247,083 122,917 $ 929,864 $ 397,137
Nancy K. Hamilton 0 N/A 0 175,000 0 415,625
Gary L. Bliss 0 N/A 145,625 84,375 629,844 272,656
Michael P. Cronin 0 N/A 58,583 142,917 205,509 481,616
John H. Elms 0 N/A 0 175,000 0 620,225
E. Ronald Elswick 50,000 578,150 68,228 0 192,768 0
</TABLE>
(1) Based on the fair market value of the Common Stock on the exercise date,
less the per share exercise price.
(2) Based on the fair market value of the underlying shares of Common Stock of
$7.25 per share, the closing price on December 31, 1999, as reported by
NASDAQ, less the per share exercise price.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
For fiscal 1999, the compensation of the executive officers of the Company was
determined by the entire Board of Directors. Since October 11, 1995, the
Company's Compensation Committee has made recommendations to the Board regarding
compensation of executive officers. Mr. Holland, a member of the Board of
Directors and the President of the Company, has participated in the
deliberations of the Board of Directors concerning executive officer
compensation, other than his own compensation.
DIRECTOR COMPENSATION
Directors currently do not receive cash compensation from the Company for their
service as members of the Board, but they are reimbursed for their expenses in
attending board and committee meetings.
Commencing with the first Board of Director meeting after this Stockholder
Meeting, each non-employee director (currently three people) will receive an
annual payment of $5,000 for serving as a director of the Company. In addition,
each non-employee director will receive $1,000 for each Board of Director or
Committee meeting, or $200 for any telephonic Board or Committee meeting,
attended by the director.
Each non-employee director will also receive an annual stock option grant (under
either the Company's new 2000 Stock Option Plan or the current Stock Option Plan
if the 2000 Stock Option Plan is not approved by stockholders at this meeting),
as follows: an initial grant of an option to purchase 20,000 shares of Common
Stock, exercisable at the fair market price of the Common Stock on the date of
grant, with vesting at the rate of 50% of the option at the first anniversary
following the date of grant and monthly thereafter over the following twelve
months (i.e., 4.17% per month). Any new non-employee director will receive this
20,000 share option upon becoming a director of the Company. Thereafter, each
non-employee director will be granted an annual stock option exercisable to
purchase 5,000 shares of Common Stock exercisable at the fair market price of
the Common Stock on the date of grant, with vesting at the rate of 50% of the
option at the first anniversary following the date of grant and monthly
thereafter over the following twelve months (i.e., 4.17% per month). See also
"Proposal 2 - Approve the Adoption of the Company's 2000 Stock Option Plan - New
Plan Benefits."
9
<PAGE> 11
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee reviews and acts on matters relating to compensation
levels and benefit plans for executive officers and key employees. The
Compensation Committee also provides for grants of stock awards, stock options,
stock appreciation rights and other awards to be made under existing incentive
compensation plans.
General Compensation Policy. The fundamental policy of the Compensation
Committee is to provide the executive officers with competitive compensation
opportunities based upon their contribution to the development and financial
success of the Company and their personal performance. The Compensation
Committee's objective is to have a portion of each executive officer's
compensation contingent on the Company's performance as well as on the executive
officer's own level of performance. Accordingly, the compensation package for
each executive officer is comprised of three elements: (1) base salary, which
principally reflects an executive officer's performance and is designed
primarily to be competitive with salary levels in the industry; (2) bonus, which
principally reflects the Company's performance; and (3) long-term incentive
compensation, which strengthens the mutuality of interests between executive
officers and stockholders.
Factors. The principal factors that the Compensation Committee considered in
ratifying the components of each executive officer's compensation package for
1999 are summarized below. The Compensation Committee may apply entirely
different factors in advising the chief executive officer and the board of
directors with respect to executive compensation for future years.
o Base Salary. The suggested base salary for each executive officer is
determined on the basis of experience, personal performance, the salary
levels for comparable positions within and without the industry, and
internal base salary comparability considerations. The weight given to each
of these factors differs from individual to individual, as the Compensation
Committee deems appropriate.
o Bonus. The suggested bonus for each executive officer is determined on the
basis of the Company's performance, personal performance, and the bonus
levels for comparable positions within and without the industry. The
Compensation Committee established maximum annual bonus amounts for each
executive officer based on the bonus levels for comparable positions, and
earned bonus amounts are based on performance results. The weight given to
each of these factors differs from individual to individual, as the
Compensation Committee deems appropriate. In addition, the Compensation
Committee may from time to time award additional cash bonuses when it
determines those bonuses to be in the Company's best interest.
o Long-Term Incentive Compensation. Long-term incentives are provided
primarily through grants of stock options. The grants are designed to align
the interests of each executive officer with those of the stockholders and
to provide each individual with a significant incentive to manage
SpectraLink from the perspective of an owner with an equity stake. Each
option grant allows the executive officer to acquire shares of the common
stock at a fixed price per share, typically equal to the market price on
the grant date, over a specified period of time of up to eight years.
Options generally become exercisable in installments over a 48-month
period, contingent upon an executive officer's continued employment with
SpectraLink. Accordingly, an option grant generally provides a return to
the executive officer only if the executive remains employed by the Company
during the vesting period, and then only if the market price of the
underlying shares appreciates. The number of shares subject to each option
grant is set at a level intended to create a meaningful opportunity for
stock ownership based on the executive officer's current position, the base
salary associated with that position, the size of comparable awards made to
individuals in similar positions within the industry, the executive
officer's potential for increased responsibility and promotion over the
option term, and the executive officer's personal performance in recent
periods. The Compensation Committee also considers the number of unvested
options held by the executive officer in order to maintain an appropriate
level of equity incentive for that executive officer. The Compensation
Committee does not adhere to any specific guidelines as to the relative
option holdings of executive officers.
CEO Compensation - SEC regulations require the board of directors to disclose
the basis for compensation paid to Mr. Bruce Holland, the President and Chief
Executive Officer, in 1999 and to discuss the relationship between the Company's
performance and Mr. Holland's performance in 1999. In advising the Board with
respect to Mr. Holland's compensation, the Compensation Committee seeks to
establish a level of base salary competitive with that paid by companies of
comparable size within the industry and by companies outside of the industry
with which SpectraLink competes for executive talent. The base salary
established for Mr. Holland for 1999 on the basis of the foregoing criteria was
intended to provide a level of compensation which was not affected to any
significant degree by the Company's performance factors.
COMPENSATION COMMITTEE
Carl D. Carman
Burton J. McMurtry
10
<PAGE> 12
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company had no transactions with related affiliates or related parties
during 1999 and 1998.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange commission
(the "SEC"). Such persons are also required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file.
To the best of the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, its officers, directors and greater than 10% beneficial
owners complied with all Section 16(a) filing requirements applicable to
transactions during 1999, except as follows: on or about December 20, 1999, Mr.
Anthony V. Carollo, Jr. reported one transaction that should have been reported
on Form 4 by December 10, 1999; on or about December 15, 1999, Mr. Burton J.
McMurtry reported seven transactions that should have been reported on Form 4 by
December, 10, 1999; on or about December 15, 1999, Technology Venture Investors
Management reported seven transactions that should have been reported on Form 4
by December 10, 1999.
PROPOSAL 2: APPROVE THE ADOPTION OF THE COMPANY'S 2000 OPTION PLAN
The Company's Board of Directors has recommended, and at the meeting the
stockholders will be asked to approve, the adoption of the 2000 Stock Option
Plan (the "2000 Option Plan").
THE FOLLOWING IS A SUMMARY OF THE COMPANY'S 2000 OPTION PLAN AND DOES NOT
PURPORT TO DESCRIBE FULLY THE 2000 OPTION PLAN. A COPY OF THE 2000 OPTION PLAN
HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND IS AVAILABLE ON
THE SEC'S WEB SITE (http://www.sec.gov). ADDITIONALLY, A COPY OF THE 2000 OPTION
PLAN IS AVAILABLE AT NO CHARGE TO ANY PERSON ENTITLED TO VOTE AT THE MEETING,
UPON WRITTEN REQUEST ADDRESSED TO: SPECTRALINK CORPORATION, ATTN: CORPORATE
SECRETARY, 5755 CENTRAL AVENUE, BOULDER, COLORADO 80301.
PURPOSE OF THE PLAN
The purpose of the 2000 Option Plan is to provide a means whereby selected
employees, officers, directors, agents, consultants and independent contractors
of SpectraLink Corporation (the "Company") or of any parent or subsidiary (as
defined in the 2000 Option Plan and referred to hereinafter as "related
corporations") thereof, may be granted incentive stock options and/or
non-qualified stock options to purchase the Common Stock of the Company, in
order to attract and retain the services or advice of such employees, officers,
directors, agents, consultants and independent contractors and to provide added
incentive to them by encouraging stock ownership in the Company.
2000 STOCK OPTION PLAN
The 2000 Option Plan initially permits the Company to grant options to purchase
a maximum of 2,000,000 shares of Common Stock for selected employees, officers,
directors, agents, consultants, and independent contractors of the Company. Such
amount shall automatically be increased on the first day of each fiscal year by
an amount equal to five percent of the total number of shares of Common Stock
outstanding on the last day of the immediately preceding fiscal year, or such
lesser number of shares that is later ratified by the Board of Directors at
their first meeting or action in the new fiscal year; provided, that in no event
shall any annual increase exceed 1,300,000 shares. Adoption of the 2000 Option
Plan will also result in no additional options being granted under the Company's
current Stock Option Plan. There are approximately 1,500,000 shares currently
reserved for the future issuance of options under the Company's current Stock
Option Plan.
Options may be either "incentive stock options" within the meaning of Section
422 of the Internal Revenue Code (the "Code"), or non-qualified options.
Incentive stock options may be granted only to an individual who, at the time
the option is granted, is an employee of the Company or any related corporation,
while non-qualified options may be granted to any director, employee, officer,
agent, consultant or independent contractor of the Company or any related
corporation, whether an individual or an entity. It is estimated that
approximately five officers, four non-officer directors, and 252 employees are
currently eligible to participate in the 2000 Option Plan.
The 2000 Option Plan will be administered by the Board of Directors of the
Company, except to the extent the Board delegates its authority to a committee
of the Board to administer the 2000 Option Plan. The administrator of the 2000
Option Plan shall hereinafter
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be referred to as the "Plan Administrator." Any party to whom an option is
granted under the 2000 Option Plan shall be referred to hereinafter as an
"Optionee."
The maximum number of shares that may be purchased pursuant to the exercise of
each option and the price per share at which such option is exercisable (the
"Exercise Price") shall be established by the Plan Administrator, provided that
the Plan Administrator shall act in good faith to establish the exercise price
which shall be not less than the fair market value per share of the Common Stock
at the time the option is granted with respect to incentive stock options and
not less than par value per share of the Common Stock at the time the option is
granted with respect to non-qualified stock options, and also provided that,
with respect to incentive stock options granted to greater than 10%
stockholders, the exercise price shall be not less than 110% of the fair market
value of a share of Common Stock at the time the incentive stock option is
granted.
Options granted under the 2000 Option Plan and the rights and privileges
conferred hereby may not be transferred, assigned, pledged or hypothecated in
any manner (whether by operation of law or otherwise) other than (i) by will or
by the applicable laws of descent and distribution, (ii) pursuant to a qualified
domestic relations order as defined in Section 414(p) of the Code, or Title I of
the Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder or (iii) as otherwise determined by the Plan Administrator and set
forth in the applicable option agreement. Any attempt to transfer, assign,
pledge, hypothecate or otherwise dispose of any option under this Plan or of any
right or privilege conferred hereby, contrary to the Code or to the provisions
of this Plan, or the sale or levy or any attachment or similar process upon the
rights and privileges conferred hereby, shall be null and void. The designation
by an Optionee of a beneficiary does not, in and of itself, constitute an
impermissible transfer under this Section.
If the Optionee's relationship with the Company or any related corporation
ceases for any reason other than termination for cause, death or total
disability, and unless by its terms the option sooner terminates or expires,
then the Optionee may exercise, for a three-month period, that portion of the
Optionee's option which is exercisable at the time of such cessation, but the
Optionee's option shall terminate at the end of the 90-day period following such
cessation as to all shares for which it has not theretofore been exercised,
unless, in the case of a non-qualified stock option, such provision is waived in
the agreement evidencing the option or by resolution adopted by the Plan
Administrator within 90 days of such cessation. If, in the case of an incentive
stock option, an Optionee's relationship with the Company or related corporation
changes (i.e., from employee to non-employee, such as a consultant), such change
shall constitute a termination of an Optionee's employment with the Company or
related corporation and the Optionee's incentive stock option shall become a
non-qualified stock option.
Options under the 2000 Option Plan must be issued within 10 years from the date
the 2000 Option Plan was adopted by the Company's Board of Directors, which was
February 16, 2000. Stock options granted under the 2000 Option Plan cannot be
exercised more than 10 years from the date of grant. Stock options issued to a
10% Stockholder are limited to five-year terms. Payment of the option price
shall be made in full at the time the notice of exercise of the option is
delivered to the Company and shall be in cash, bank certified or cashier's check
or personal check (unless at the time of exercise the Plan Administrator in a
particular case determines not to accept a personal check).
The Plan Administrator can determine at the time the option is granted for
incentive stock options, or at any time before exercise for non-qualified stock
options, that additional forms of payment will be permitted. To the extent
permitted by the Plan Administrator and applicable laws and regulations
(including, but not limited to, federal tax and securities laws and regulations
and state corporate law), an option may be exercised by delivery of shares of
stock of the Company held by an Optionee for at least six months and having a
fair market value equal to the exercise price, such fair market value to be
determined in good faith by the Plan Administrator; or delivery of a properly
executed exercise notice, together with irrevocable instructions to a broker,
all in accordance with the regulations of the Federal Reserve Board, to promptly
deliver to the Company the amount of sale or loan proceeds necessary to pay the
exercise price and any federal, state or local withholding tax obligations that
may arise in connection with the exercise.
Any unexercised options that expire or that terminate upon an employee's ceasing
to be employed by the Company become available again for issuance under the 2000
Option Plan.
Unless sooner terminated by the Board, this Plan shall terminate on February 15,
2010. No option may be granted after such termination or during any suspension
of this Plan. The amendment or termination of this Plan shall not, without the
consent of the option holder, alter or impair any rights or obligations under
any option theretofore granted under this Plan.
The Board may at any time suspend, amend or terminate this Plan, provided that
except as set forth in Section 7 (related to stock splits, stock dividends,
mergers, share exchanges, and similar transactions), the approval of the holders
of a majority of the Company's outstanding shares of voting capital stock
present and entitled to vote at any meeting is necessary for the adoption by the
Board of any amendment which will: (a) increase the number of shares which are
to be reserved for the issuance of options under this Plan; (b) permit the
granting of stock options to a class of persons other than those presently
permitted to receive stock options under this Plan; or (c) require stockholder
approval under applicable law, including Section 16(b) of the Exchange Act.
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<PAGE> 14
The vesting of outstanding options under the 2000 Option Plan will be subject to
acceleration upon certain changes in the ownership or control of the Company. In
the case of (i) a merger or consolidation in which the Company is not the
surviving corporation (except a merger intended solely to reincorporate the
Company), (ii) a reverse merger in which the Company is the surviving
corporation by the shares of the Company's Common Stock outstanding immediately
preceding the merger are converted by virtue of the merger into other property,
(iii) any other capital reorganization, liquidation or change in control in
which more than fifty percent of the shares of the Company entitled to vote are
exchanged, (iv) the sale of all or substantially all of the Company's assets,
the Board of Directors shall provide for the acceleration of the exercise date
of fifty percent of the non-exercisable portion of outstanding options as of the
day before the closing date of such transaction. The acceleration of the vesting
of options in the event of such changes in control may have the effect of
discouraging a merger proposal, a takeover attempt, or other efforts to gain
control of the Company.
NEW PLAN BENEFITS
Because benefits under the 2000 Option Plan will depend on the Plan
Administrator's actions and the fair market value of common stock at various
future dates, it is not possible to determine the benefits that will be received
by directors, executive officers and other employees if the 2000 Stock Plan is
approved by the stockholders, except the following: upon adoption of the 2000
Option Plan, non-employee directors (currently three people) will be granted
stock options annually under the 2000 Option Plan. The initial grant to each
non-employee director will be options to purchase 20,000 shares of Common Stock;
subsequent annual grants will be for options to purchase 5,000 shares of Common
Stock. The options will be exercisable at the fair market price of the Common
Stock on the date of grant and will vest at the rate of 50% of the option at the
first anniversary following the date of grant and monthly thereafter over the
following twelve months (i.e., 4.17% per month).
REGISTRATION OF SHARES ISSUED UNDER 2000 OPTION PLAN
The Company intends that the shares to be reserved for and issued under the 2000
Option Plan, for which approval is now sought, may be registered under the
Securities Act of 1933, as amended. Such registration, if completed, would in
most cases permit the unrestricted resale in the public market of shares issued
pursuant to the Option Plan.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE 2000 OPTION PLAN UNDER CURRENT
LAW
An optionee will recognize no taxable income at the time an option is granted.
An optionee will recognize no taxable income at the time of exercise of an
incentive stock option. If the optionee makes no disposition of the acquired
shares within two years after the date of grant of the incentive stock option,
or within one year after the exercise of such option, the employee will
recognize no taxable income and any gain or loss that is realized on a
subsequent disposition of such shares will be treated as long-term capital gain
or loss. As to options exercised, the excess, if any, of the fair market value
of the shares on the date of exercise over the option price will be an item of
tax preference for purposes of computing the alternative minimum tax.
If the foregoing holding period requirements are not satisfied, the optionee
will realize (i) ordinary income for federal income tax purposes in the year of
disposition in an amount equal to the lesser of (a) the excess, if any, of the
fair market value of the shares on the date of exercise over the option price
thereof, or (b) the excess, if any, of the selling price over the optionee's
adjusted basis of such shares (provided that the disposition is a sale or
exchange with respect to which a loss (if sustained) would be recognized by such
individual) and (ii) capital gain equal to the excess, if any, of the amount
realized upon the disposition of shares over the fair market value of such
shares on the date of exercise.
Employees, directors, officers, consultants, agents and independent contractors
of the Company will be required to include in their gross income in the year of
exercise of a non-qualified stock option the difference between the fair market
value on the exercise date of the shares transferred and the option price.
The Company will be entitled (provided it complies with certain reporting
requirements with respect to the income received by the employee) to a deduction
for federal income tax purposes at the same time and in the same amount as the
optionee is considered to be in receipt of compensation income in connection
with the exercise of non-qualified stock options or, in the case of an incentive
stock option, a disqualifying disposition of shares received upon exercise
thereof. If the holding period requirements outlined above are met, no deduction
will be available to the Company in connection with an incentive stock option.
Under the Revenue Reconciliation Act of 1993, the Company may not be able to
deduct compensation to certain employees to the extent compensation exceeds one
million dollars per tax year. Covered employees include the chief executive
officer and the four other highest compensated officers of the Company for that
tax year. Certain performance-based compensation including stock options are
exempt provided that, among other things, the stock options are granted by a
Compensation Committee of the Board of Directors which is comprised solely of
two or more outside directors and the plan under which the options are granted
is approved by stockholders. The Option Plan will not qualify as
performance-based compensation.
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<PAGE> 15
VOTE REQUIRED
The affirmative vote of a majority of the shares represented at the meeting
(exclusive of broker non-votes) will be required to approve the 2000 Option
Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE COMPANY'S 2000
OPTION PLAN, WHICH IS DESIGNATED AS PROPOSAL 2 ON THE ENCLOSED PROXY CARD.
PROPOSAL 3: APPROVE AMENDMENT TO EMPLOYEE STOCK PURCHASE PLAN
The Company's Board of Directors has recommended, and at the meeting the
stockholders will be asked to approve, an amendment to the Employee Stock
Purchase Plan (the "Purchase Plan"), increasing the number of shares of Common
Stock authorized to be issued by 100,000 shares and providing for an annual
increase in the number of shares of Common Stock available under the Purchase
Plan in an amount equal to 60,000 shares per year.
THE FOLLOWING IS A SUMMARY OF THE COMPANY'S STOCK PURCHASE PLAN, AS AMENDED, AND
DOES NOT PURPORT TO DESCRIBE FULLY THE PURCHASE PLAN. A COPY OF THE PURCHASE
PLAN, AS AMENDED, HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
IS AVAILABLE ON THE SEC'S WEB SITE (http://www.sec.gov). ADDITIONALLY, A COPY OF
THE PURCHASE PLAN, AS AMENDED, IS AVAILABLE AT NO CHARGE TO ANY PERSON ENTITLED
TO VOTE AT THE MEETING, UPON WRITTEN REQUEST ADDRESSED TO: SPECTRALINK
CORPORATION, ATTN: CORPORATE SECRETARY, 5755 CENTRAL AVENUE, BOULDER, COLORADO
80301.
PURPOSE OF THE PURCHASE PLAN
The Purchase Plan, adopted in 1995, provides employees (including officers) of
the Company and its majority-owned subsidiaries with an opportunity to purchase
through payroll deductions Common Stock at a purchase price that is 85% of the
lesser of the fair market value of Common Stock at the beginning of an offering
period or the fair market value of Common Stock at the end of an offering
period.
EMPLOYEE STOCK PURCHASE PLAN
The following is a summary of the terms of the Purchase Plan. Copies of the
Purchase Plan are available upon request from the Company. In addition, a copy
of the Purchase Plan is on file with the SEC.
The Purchase Plan may be administered by the Board of Directors of the Company
or by a committee appointed by the Board and is currently being administered by
the Compensation Committee. All questions of interpretation or application of
the Purchase Plan are determined by the Compensation Committee, whose decisions
are final, conclusive, and binding upon all participants.
Any employee (including an officer) who is employed for at least 20 hours per
week and more than five months per calendar year by the Company is eligible to
participate in the Purchase Plan, provided that such employee is so employed on
the date his or her participation in the plan is effective and subject to
limitations imposed by Section 423(b) of the Internal Revenue Code and
limitations on stock ownership described in the Purchase Plan. It is estimated
that approximately five officers and 252 employees are currently eligible to
participate in the Purchase Plan.
Eligible employees become participants in the Purchase Plan by delivering to the
Company's payroll office, prior to the commencement of the applicable offering
period, a subscription agreement authorizing payroll deductions of a whole
percentage of his or her salary, not to exceed 10%. Each offering period lasts
six months, beginning either on January 1 or July 1. On December 31, 1999, the
closing price per share for the Company's Common Stock was $7.25.
Each participant who has elected to participate is automatically granted an
option to purchase shares of common stock on the beginning of the offering
period, provided that no employee will be granted an option if such employee
would then own stock, or a combination of stock and options that exceed 5% of
the total combined voting power of the Company, or if the option would permit
such employee to purchase stock under all employee stock purchase plans of the
Company to accrue at a rate which exceeds $25,000 in fair market value of Common
Stock (determined at the time the option is granted) for each calendar year in
which such option is outstanding.
The option expires at the end of the offering period or upon termination of
employment, whichever is earlier, but is exercised at the end of each offering
period to the extent of the payroll deductions accumulated during such offering
period.
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Termination of a participant's employment for any reason, including death,
immediately cancels his or her option and participation in the Purchase Plan. In
such event, the payroll deductions credited to the participant's account will be
returned without interest to him or her or, in the case of death, to the person
or persons entitled to those deductions.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE PURCHASE PLAN UNDER CURRENT LAW
No income will be taxable to a participant until the shares purchased under the
Purchase Plan are sold or otherwise disposed. Upon sale or other disposition of
the shares, the participant will generally be subject to tax and the amount of
the tax will depend upon the holding period. If the shares are sold or otherwise
disposed of more than two years from the first day of the applicable offering
period and more than one year from the date of transfer of the shares to the
participant, then the participant generally will recognize ordinary income
measured as the lesser of (i) the excess of the fair market value of the shares
at the time of such sale or disposition over the purchase price, or (ii) an
amount equal to 15% of the fair market value of the shares as of the acquisition
date. Any additional gain should be treated as long-term capital gain. If the
shares are sold or otherwise disposed of before the expiration of this holding
period, the participant will recognize ordinary income generally measured as the
excess of the fair market value of the shares on the date the shares are
purchased over the purchase price. Any additional gain or loss on such sale or
disposition will be long-term or short-term capital gain or loss, depending on
the holding period.
The Company is not entitled to a deduction for amounts taxed as ordinary income
or capital gain to a participant except to the extent ordinary income is
recognized by participants upon a sale or disposition of shares prior to the
expiration of the holding period(s) described above. In all other cases, no
deduction is allowed to the Company.
PROPOSED AMENDMENT
In February 2000, the Board of Directors adopted an amendment to the Purchase
Plan (a) to increase the number of shares of Common Stock reserved for issuance
thereunder by 100,000, bringing the total number of shares currently reserved
for issuance under the Purchase Plan to 156,611 shares and (b) providing for an
additional 60,000 shares to be reserved in each year hereafter to replenish
shares sold during the year. The proposed share increase and replenishment
provision will ensure that an adequate number of shares are available for
issuance under the Plan for the foreseeable future.
AMENDED PLAN BENEFITS
Because benefits under the Purchase Plan will depend on employees' elections to
participate and the fair market value of the Company's Common Stock at various
future dates, it is not possible to determine the benefits that will be received
by executive officers and other employees if the amendment to the Purchase Plan
is approved by the share owners. Non-employee directors are not eligible to
participate in the Purchase Plan.
VOTE REQUIRED
The affirmative vote of a majority of the shares represented at the meeting
(exclusive of broker non-votes) will be required to approve the proposed
amendment to the Purchase Plan.
Recommendation
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO AMEND THE PURCHASE
PLAN, WHICH IS DESIGNATED AS PROPOSAL 3 ON THE ENCLOSED PROXY CARD.
PROPOSAL 4. RATIFICATION OF SELECTION OF AUDITORS
The board has selected Arthur Andersen LLP, independent public accountants, as
independent auditors for the Company for 2000. A resolution will be submitted to
stockholders at the meeting for ratification of such selection and the
accompanying proxy will be voted for such ratification, unless instructions to
the contrary are indicated therein. Although ratification by stockholders is not
a legal prerequisite to the Board's selection of Arthur Andersen LLP as the
Company's independent public accountants, the Company believes such ratification
to be appropriate. If the stockholders do not ratify the selection of Arthur
Andersen LLP, the selection of independent public accountants will be
reconsidered by the Board; however, the Board may select Arthur Andersen LLP,
notwithstanding the failure of the stockholders to ratify its selection.
The Board expects that representatives of Arthur Andersen LLP will be present at
the meeting, will have an opportunity to make a statement if they so desire, and
will be available to respond to appropriate questions.
Arthur Andersen LLP has been the Company's independent public accountants since
1991. During the fiscal year ended December 31, 1999, Arthur Andersen LLP
performed audit and other services for the Company including attendance at
meetings with the Audit
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Committee and the Board on matters related to the audit, consultations during
the year on matters related to accounting, financial reporting and the review of
financial and related information that was included in filings with the
Securities and Exchange Commission.
The appointment of auditors is approved annually by the board. The decision of
the board is based upon the recommendation of the Audit committee of the Board.
In making its recommendation as to the appointment of auditors, the Audit
Committee reviews both the proposed audit scope and the estimated audit fees for
the coming year.
THE BOARD OF DIRECTORS OF SPECTRALINK RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 4.
MISCELLANEOUS MATTERS
As of the date of this Proxy Statement, the Board knows of no business that will
be presented for consideration at the meeting other than that which has been
referred to above. As to other business, if any, that may come before the
meeting; proxies in the enclosed form will be voted in accordance with the
judgment of the person or persons voting the proxies.
The Company's Certificate of Incorporation and Bylaws require that there be
furnished to the Company written notice with respect to the nomination of a
person for election as a director (other than a person nominated at the
direction of the Board), as well as the submissions of a proposal (other than a
proposal submitted at the direction of the Board), at a meeting of stockholders.
In order for any such nomination or submission to be proper with respect to the
2001 Annual Meeting, the notice must contain certain information concerning the
nominating or proposing stockholder, and the nominee or the proposal, as the
case may be, and must be furnished to the Company between January 31, 2001, and
March 2, 2001. A copy of the applicable provisions of the Certificate of
Incorporation and Bylaws may be obtained by a stockholder, without charge, upon
written request to the Secretary of the Company, at its principal executive
offices.
In addition to the foregoing, in accordance with the rules of the SEC, any
proposal of a stockholder intended to be presented at the Company's 2001 Annual
Meeting of Stockholders must be received by the Secretary of the Company by
December 12, 2000, in the form and subject to the other requirements of the
applicable rules of the SEC, in order for the proposal to be considered for
inclusion in the Company's notice of meeting, proxy statement and proxy relating
to the 2001 Annual Meeting.
Cost of Proxy Solicitation
The Company will bear the cost of the solicitation of proxies, including the
charges and expenses of brokerage firms and others for forwarding solicitation
material to beneficial owners of shares of Common Stock. In addition to
solicitation by mail, officers and regular employees of the Company may solicit
proxies personally or by telephone. No compensation other than their regular
compensation will be paid to officers or employees for any solicitation, which
they may make.
At any time prior to being voted, the enclosed proxy is revocable by written
notice to the Secretary of the Company or by appearance at the meeting to vote
in person.
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THE BOARD OF DIRECTORS
SPECTRALINK CORPORATION
Dated: March 24, 2000
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SPECTRALINK CORPORATION
2000 STOCK OPTION PLAN
ADOPTED AND APPROVED BY THE BOARD OF DIRECTORS ON FEBRUARY 16, 2000
APPROVED BY THE STOCKHOLDERS ON ____________, 2000
SECTION 1. PURPOSE. The purpose of the SpectraLink 2000 Stock Option
Plan (this "Plan") is to provide a means whereby selected employees, officers,
directors, agents, consultants and independent contractors of SpectraLink
Corporation (the "Company") or of any parent or subsidiary (as defined in
subsection 5.7 and referred to hereinafter as "related corporations") thereof,
may be granted "incentive stock options" (as defined in Section 422 of the
Internal Revenue Code of 1986 (the "Code")) and/or non-qualified stock options
to purchase the Common Stock (as defined in Section 3) of the Company, in order
to attract and retain the services or advice of such employees, officers,
directors, agents, consultants and independent contractors and to provide added
incentive to them by encouraging stock ownership in the Company.
SECTION 2. ADMINISTRATION.
(a) This Plan shall be administered by the Board of Directors of the
Company (the "Board"), except to the extent the Board delegates its authority to
a member of the Board or a committee of the Board to administer this Plan. The
administrator of this Plan shall hereinafter be referred to as the "Plan
Administrator." The Board may appoint a Plan Administrator as described in
subsection 2(b) hereof, which shall have authority to grant options as provided
therein; the Board may also appoint a Plan Administrator with limited authority,
such as to grant options to persons who are not officers or directors of the
Company, for a limited number of shares or pursuant to a matrix by employee
category pre-approved by the Board.
(b) For so long as the Company's Common Stock is registered under
Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), no option shall be granted to a director or officer (who is subject to
Section 16 of the Exchange Act) under this Plan unless (i) approved in advance
by the Board or the Plan Administrator in accordance with the provisions of Rule
16b-3(d)(1) under the Exchange Act (where the Plan Administrator, if not the
entire Board, is a committee of the Board composed solely of two or more
non-employee directors who satisfy the requirements of Rule 16b-3(b)(3) under
the Exchange Act), or (ii) approved in accordance with the provisions of Rule
16b-3(d)(2) under the Exchange Act, except that an option may be granted absent
such approval if the option provides that no officer or director of the Company
may sell shares received upon the exercise of such option during the six-month
period immediately following the grant of such option.
2.1 PROCEDURES. The Board may designate one of the members of the
Plan Administrator as chairman. The Plan Administrator may hold meetings at such
times and places as it shall determine necessary. The acts of a majority of the
members of the Plan Administrator present at meetings at which a quorum exists,
or acts reduced to or approved in writing by all Plan Administrator members
shall be valid acts of the Plan Administrator.
<PAGE> 20
2.2 RESPONSIBILITIES. Except for the terms and conditions
explicitly set forth in this Plan, the Plan Administrator shall have the
authority, in its discretion, to determine all matters relating to the options
to be granted under this Plan, including selection of the individuals to be
granted options, the number of shares to be subject to each option, the exercise
price, and all other terms and conditions of the options, including the
designation of such options as an incentive stock option or non-qualified stock
option. Grants under this Plan need not be identical in any respect, even when
made simultaneously. The interpretation and construction by the Plan
Administrator of any terms or provisions of this Plan or any option issued
hereunder, or of any rule or regulation promulgated in connection herewith,
shall be conclusive and binding on all interested parties, so long as such
interpretation and construction with respect to incentive stock options
corresponds to the requirements of Code Section 422, the regulations thereunder,
and any amendments thereto.
2.3 SECTION 16(b) COMPLIANCE AND BIFURCATION OF PLAN. It is the
intention of the Company that this Plan comply in all respects with Section
16(b) and Rule 16b-3 under the Exchange Act, to the extent applicable, and, if
any Plan provision is later found not to be in compliance with such Section or
Rule, as the case may be, the provision shall be deemed null and void, and in
all events the Plan shall be construed in favor of its meeting the requirements
of Section 16(b) and Rule 16b-3 under the Exchange Act. Notwithstanding anything
in the Plan to the contrary, the Board, in its absolute discretion, may
bifurcate the Plan so as to restrict, limit or condition the use of any
provision of the Plan to participants who are officers and directors or other
persons subject to Section 16(b) of the Exchange Act without so restricting,
limiting or conditioning the Plan with respect to other participants.
SECTION 3. STOCK SUBJECT TO THIS PLAN.
3.1 SHARES RESERVED FOR ISSUANCE PURSUANT TO EXERCISE OF OPTIONS;
AUTOMATIC INCREASE IN RESERVED SHARES. The stock subject to this Plan shall be
the Company's Common Stock, $.01 par value per share (the "Common Stock"),
presently authorized but unissued or subsequently acquired by the Company.
Subject to adjustment as provided in Section 7 hereof, the aggregate amount of
Common Stock to be delivered upon the exercise of all options granted under this
Plan shall not exceed 2,000,000 shares as such Common Stock was constituted
on the effective date of this Plan, and no further options shall be granted
after the date on which the SpectraLink stockholders approve this Plan, under
the SpectraLink Stock Option Plan (in effect as of such date). In addition, the
shares reserved for issuance upon exercise of options granted under this Plan
will automatically be increased on the first day of each fiscal year, beginning
with the fiscal year commencing January 1, 2001, by an amount equal to five
percent (5%) of the total number of shares of Common Stock outstanding on the
last day of the immediately preceding fiscal year, or such lesser number of
shares as is later ratified by the Board at their first meeting or action in
such new fiscal year; provided, that in no event shall any such annual increase
exceed 1,300,000 shares.
3.2 STATUS OF SHARES UNDERLYING SURRENDERED, EXCHANGED, CANCELED
OR TERMINATED OPTIONS. If any option granted under this Plan shall expire, be
surrendered, exchanged for another option, canceled or terminated for any reason
without having been exercised in full, the unpurchased shares subject thereto
shall thereupon again be available for purposes of this Plan, including
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<PAGE> 21
for replacement options which may be granted in exchange for such surrendered,
canceled or terminated options.
SECTION 4. ELIGIBILITY. An incentive stock option may be granted only
to any individual who, at the time the option is granted, is an employee of the
Company or any related corporation. A nonqualified stock option may be granted
to any director, employee, officer, agent, consultant or independent contractor
of the Company or any related corporation, whether an individual or an entity.
Any party to whom an option is granted under this Plan shall be referred to
hereinafter as an "Optionee".
SECTION 5. TERMS AND CONDITIONS OF OPTIONS. Options granted under this
Plan shall be evidenced by written agreements which shall contain such terms,
conditions, limitations and restrictions as the Plan Administrator shall deem
advisable and which are not inconsistent with this Plan (the "Option
Agreement"). Notwithstanding the foregoing, options shall include or incorporate
by reference the following terms and conditions:
5.1 NUMBER OF SHARES AND PRICE. The maximum number of shares that
may be purchased pursuant to the exercise of each option and the price per share
at which such option is exercisable (the "exercise price") shall be as
established by the Plan Administrator, provided that the Plan Administrator
shall act in good faith to establish the exercise price which shall be not less
than the fair market value per share of the Common Stock at the time the option
is granted with respect to incentive stock options and not less than par value
per share of the Common Stock at the time the option is granted with respect to
nonqualified stock options and also provided that, with respect to incentive
stock options granted to greater than "10% shareholders" (as defined in Section
6.1 hereof), the exercise price shall be as required by Section 6.
5.2 TERM AND MATURITY. Subject to the restrictions contained in
Section 6 with respect to granting incentive stock options to greater than 10%
shareholders, the term of each incentive stock option shall be as established by
the Plan Administrator and, if not so established, shall be 10 years from the
date it is granted but in no event shall the term of any incentive stock option
exceed 10 years. The term of each nonqualified stock option shall be as
established by the Plan Administrator and, if not so established, shall be 10
years from the date it is granted. To ensure that the Company or related
corporation will achieve the purpose and receive the benefits contemplated in
this Plan, any option granted to any Optionee hereunder shall, unless the
condition of this sentence is waived or modified in the agreement evidencing the
option or by resolution adopted by the Plan Administrator, be exercisable
according to the following schedule:
Period of Optionee's
Continuous Relationship
With the Company or Related
Corporation From the Date Portion of Total Option
the Option is Granted Which is Exercisable
---------------------------- -----------------------
End of 12 months 25%
Each month thereafter 2.083%
48 months 100%
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<PAGE> 22
5.3 EXERCISE. Subject to any vesting schedule described in
subsection 5.2 above, each option may be exercised in whole or in part; and that
only whole shares will be issued pursuant to the exercise of any option. Options
shall be exercised by delivery to the Company of notice of the number of shares
with respect to which the option is exercised, together with payment of the
exercise price.
5.4 PAYMENT OF EXERCISE PRICE. Payment of the option exercise
price shall be made in full at the time the notice of exercise of the option is
delivered to the Company and shall be in cash, bank certified or cashier's check
or personal check (unless at the time of exercise the Plan Administrator in a
particular case determines not to accept a personal check) for the Common Stock
being purchased.
The Plan Administrator can determine at the time the option is
granted for incentive stock options, or at any time before exercise for
nonqualified stock options, that additional forms of payment will be permitted.
To the extent permitted by the Plan Administrator and applicable laws and
regulations (including, but not limited to, federal tax and securities laws and
regulations and state corporate law), an option may be exercised by:
(a) delivery of shares of stock of the Company held by an Optionee
for at least six months prior to the date of exercise of the option, having a
fair market value equal to the exercise price, such fair market value to be
determined in good faith by the Plan Administrator; or
(b) delivery of a properly executed exercise notice, together with
irrevocable instructions to a broker, all in accordance with the regulations of
the Federal Reserve Board, to promptly deliver to the Company the amount of sale
or loan proceeds necessary to pay the exercise price and any federal, state or
local withholding tax obligations that may arise in connection with the
exercise.
5.5 WITHHOLDING TAX REQUIREMENT. The Company or any related
corporation shall have the right to retain and withhold from any payment of cash
or Common Stock under the Plan the amount of taxes required by any government to
be withheld or otherwise deducted and paid with respect to such payment. At its
discretion, the Company may require an Optionee receiving shares of Common Stock
to reimburse the Company for any such taxes required to be withheld by the
Company and withhold such shares in whole or in part until the Company is so
reimbursed. In lieu thereof, the Company, at its option in its sole discretion,
shall (a) have the right to withhold from any other cash amounts due or to
become due from the Company to the Optionee an amount equal to such taxes or (b)
retain and withhold a number of shares having a market value not less than the
amount of such taxes required to be withheld by the Company to reimburse the
Company for any such taxes and cancel (in whole or in part) any such shares so
withheld. If required by Section 16(b) of the Exchange Act, the election to pay
withholding taxes by delivery of shares held by any person who at the time of
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<PAGE> 23
exercise is subject to Section 16(b) of the Exchange Act, shall be made either
six months prior to the date the option exercise becomes taxable or at such
other times as the Company may determine as necessary to comply with Section
16(b) of the Exchange Act.
5.6 ASSIGNABILITY AND TRANSFERABILITY OF OPTION. Options granted
under this Plan and the rights and privileges conferred hereby may not be
transferred, assigned, pledged or hypothecated in any manner (whether by
operation of law or otherwise) other than (i) by will or by the applicable laws
of descent and distribution, (ii) pursuant to a qualified domestic relations
order as defined in Section 414(p) of the Code, or Title I of the Employee
Retirement Income Security Act of 1974, as amended, or the rules thereunder or
(iii) as otherwise determined by the Plan Administrator and set forth in the
applicable Option Agreement. Any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of any option under this Plan or of any right
or privilege conferred hereby, contrary to the Code or to the provisions of this
Plan, or the sale or levy or any attachment or similar process upon the rights
and privileges conferred hereby shall be null and void. The designation by an
Optionee of a beneficiary does not, in and of itself, constitute an
impermissible transfer under this Section.
5.7 TERMINATION OF RELATIONSHIP. If the Optionee's relationship
with the Company or any related corporation ceases for any reason other than
termination for cause, death or total disability, and unless by its terms the
option sooner terminates or expires, then the Optionee may exercise, for a
90-day period, that portion of the Optionee's option which is exercisable at the
time of such cessation, but the Optionee's option shall terminate at the end of
the 90-day period following such cessation as to all shares for which it has not
theretofore been exercised, unless, in the case of a nonqualified stock option,
such provision is waived in the agreement evidencing the option or by resolution
adopted by the Plan Administrator within 90 days of such cessation. If, in the
case of an incentive stock option, an Optionee's relationship with the Company
or related corporation changes (i.e., from employee to non-employee, such as a
consultant), such change shall constitute a termination of an Optionee's
employment with the Company or related corporation and the Optionee's incentive
stock option shall become a non-qualified stock option.
If an Optionee is terminated for cause, any option granted
hereunder shall automatically terminate as of the first discovery by the Company
of any reason for termination for cause, and such Optionee shall thereupon have
no right to purchase any shares pursuant to such option. "Termination for cause"
shall mean dismissal for dishonesty, conviction or confession of a crime
punishable by law (except minor violations), fraud, misconduct or disclosure of
confidential information. If an Optionee's relationship with the Company or any
related corporation is suspended pending an investigation of whether or not the
Optionee shall be terminated for cause, all Optionee's rights under any option
granted hereunder likewise shall be suspended during the period of
investigation.
If an Optionee's relationship with the Company or any related
corporation ceases because of a total disability, the Optionee's option shall
not terminate or, in the case of an incentive stock option, cease to be treated
as an incentive stock option until the end of the 12-month period following such
cessation (unless by its terms it sooner terminates and expires). As used in
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<PAGE> 24
this Plan, the term "total disability" refers to a mental or physical impairment
of the Optionee which is expected to result in death or which has lasted or is
expected to last for a continuous period of 365 days or more and which causes
the Optionee to be unable, in the opinion of the Company and two (if more than
one is required by the Company in its sole discretion) independent physicians,
to perform his or her duties for the Company and to be engaged in any
substantial gainful activity. Total disability shall be deemed to have occurred
on the first day after the Company and the two (if more than one is required by
the Company in its sole discretion) independent physicians have furnished their
opinion of total disability to the Plan Administrator.
For purposes of this subsection 5.7, a transfer of relationship
between or among the Company and/or any related corporation shall not be deemed
to constitute a cessation of relationship with the Company or any of its related
corporations. For purposes of this subsection 5.7, with respect to incentive
stock options, employment shall be deemed to continue while the Optionee is on
military leave, sick leave or other bona fide leave of absence (as determined by
the Plan Administrator). The foregoing notwithstanding, employment shall not be
deemed to continue beyond the first 90 days of such leave, unless the Optionee's
reemployment rights are guaranteed by statute or by contract.
As used herein, the term "related corporation", when referring to
a subsidiary corporation, shall mean any corporation (other than the Company) or
other entity in, at the time of the granting of the option, an unbroken chain of
corporations ending with the Company, if stock or other interests possessing 50%
or more of the total combined voting power of all classes of stock or other
interests of each of the corporations or other entities other than the Company
is owned by one of the other corporations or other entities in such chain. When
referring to a parent corporation or other entity, the term "related
corporation" shall mean any corporation or other entity in an unbroken chain of
corporations or other entities ending with the Company if, at the time of the
granting of the option, each of the corporations or other entities other than
the Company owns stock or other interests possessing 50% or more of the total
combined voting power of all classes of stock or other interests in one of the
other corporations or other entities in such chain.
5.8 DEATH OF OPTIONEE. If an Optionee dies while he or she has a
relationship with the Company or any related corporation or within the 90-day
period (or 12 month period in the case of totally disabled Optionees) following
cessation of such relationship, any option held by such Optionee to the extent
that the Optionee would have been entitled to exercise such option, may be
exercised within one year after his or her death by the personal representative
of his or her estate or by the person or persons to whom the Optionee's rights
under the option shall pass by will or by the applicable laws of descent and
distribution.
5.9 STATUS OF SHAREHOLDER. Neither the Optionee nor any party to
which the Optionee's rights and privileges under the option may pass shall be,
or have any of the rights or privileges of, a shareholder of the Company with
respect to any of the shares issuable upon the exercise of any option granted
under this Plan unless and until such option has been exercised.
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<PAGE> 25
5.10 NO RIGHT TO CONTINUATION OF EMPLOYMENT. Nothing in this Plan
or in any option granted pursuant to this Plan shall confer upon any Optionee
any right to continue in the employ of the Company or of a related corporation,
or to interfere in any way with the right of the Company or of any such related
corporation to terminate his or her employment or other relationship with the
Company at any time.
5.11 MODIFICATION AND AMENDMENT OF OPTION. Subject to the
requirements of Code Section 422 with respect to incentive stock options and to
the terms and conditions and within the limitations of this Plan, the Plan
Administrator may modify or amend outstanding options granted under this Plan.
The modification or amendment of an outstanding option shall not, without the
consent of the Optionee, impair or diminish any of his or her rights or any of
the obligations of the Company under such option. Except as otherwise provided
in this Plan, no outstanding option shall be terminated without the consent of
the Optionee. Unless the Optionee agrees otherwise, any changes or adjustments
made to outstanding incentive stock options granted under this Plan shall be
made in such a manner so as not to constitute a "modification" as defined in
Code Section 424(h) and so as not to cause any incentive stock option issued
hereunder to fail to continue to qualify as an incentive stock option as defined
in Code Section 422(b).
5.12 LIMITATION ON VALUE FOR INCENTIVE STOCK OPTIONS. As to all
incentive stock options granted under the terms of this Plan, to the extent that
the aggregate fair market value (determined at the time the incentive stock
option is granted) of the stock with respect to which incentive stock options
are exercisable for the first time by the Optionee during any calendar year
(under this Plan and all other incentive stock option plans of the Company, a
related corporation or a predecessor corporation) exceeds $100,000, such options
shall be treated as nonqualified stock options. The previous sentence shall not
apply if the Code is amended or if the Internal Revenue Service publicly rules,
issues a private ruling to the Company, any Optionee, or any legatee, personal
representative or distributee of an Optionee or issues regulations, changing or
eliminating such annual limit, in which case the limitation shall be that
provided by the Code or the Internal Revenue Service, as the case may be.
5.13 VALUATION OF COMMON STOCK RECEIVED UPON EXERCISE.
5.13.1 EXERCISE OF OPTIONS UNDER SECTIONS 5.4(A) AND (C). The
value of Common Stock received by the Optionee from an exercise under Sections
5.4(a) and 5.4(c) hereof shall be the fair market value, which shall mean the
last reported sales price, regular way, of the Common Stock on the date of
receipt by the Company of the Optionee's delivery of shares under Section 5.4(a)
hereof or delivery of the exercise notice under Section 5.4(c) hereof (or, if no
sale takes place on any such day, the closing bid price of the Common Stock on
such day), on the principal securities exchange (including the National
Association of Securities Dealers, Inc.'s (the "NASD") National Market System)
on which the Common Stock is admitted or listed for trading, or, if the Common
Stock is not listed on any such exchange on any such day, the highest reported
bid price for the Common Stock as furnished by the NASD through NASDAQ, or a
similar organization if NASDAQ is no longer reporting such information, or, if
the Common Stock is not listed for trading on an exchange and is not quoted on
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<PAGE> 26
NASDAQ or any similar organization on any such day, the fair value of a share of
Common Stock on such day as determined by the Plan Administrator of the Company
in good faith.
5.13.2 EXERCISE OF OPTION UNDER SECTION 5.4(B). The value of
Common Stock received by the Optionee from an exercise under Section 5.4(b)
hereof (a) in the case of the sale of the Common Stock received as a result of
the exercise by a broker on the date of receipt by the Company of the Optionee's
exercise notice, shall equal the sales price received for such shares; and (b)
in all other cases, shall be determined as provided in Section 5.13.1 hereof.
SECTION 6. GREATER THAN 10% SHAREHOLDERS.
6.1 EXERCISE PRICE AND TERM OF INCENTIVE STOCK OPTIONS. If
incentive stock options are granted under this Plan to employees who own more
than 10% of the total combined voting power of all classes of stock of the
Company or any related corporation (a "10% shareholder"), the term of such
incentive stock options shall not exceed five years and the exercise price shall
be not less than 110% of the fair market value of the Common Stock at the time
the incentive stock option is granted. This provision shall control
notwithstanding any contrary terms contained in an option agreement or any other
document. The term and exercise price limitations of this provision shall be
amended to conform to any change required (or, in the sole discretion of the
Plan Administrator, permitted) by a change in the Code or by a ruling or
pronouncement of the Internal Revenue Service.
6.2 ATTRIBUTION RULE. For purposes of subsection 6.1, in
determining stock ownership, an employee shall be deemed to own the stock owned,
directly or indirectly, by or for his or her brothers, sisters, spouse,
ancestors and lineal descendants. Stock owned, directly or indirectly, by or for
a corporation, partnership, estate or trust shall be deemed to be owned
proportionately by or for its stockholders, partners or beneficiaries. If an
employee or a person related to the employee owns an unexercised option or
warrant to purchase stock of the Company, the stock subject to that portion of
the option or warrant which is unexercised shall not be counted in determining
stock ownership. For purposes of this Section 6, stock owned by an employee
shall include all stock owned by him or her, which is actually issued and
outstanding immediately before the grant of the incentive stock option to the
employee.
SECTION 7. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. In case of any
stock split, stock dividend or similar transaction which increases or decreases
the number of outstanding shares of the Company's Common Stock, appropriate
adjustment will be made to both the number of shares which may be purchased
under the Plan and the number and price per share of Common Stock which may be
purchased under any outstanding options to give the optionee the economic
benefit of this option following any such transaction.
7.1.1 EFFECT OF MERGER, LIQUIDATION, REORGANIZATION OR CHANGE IN
CONTROL. Except in the case of a transaction where the options outstanding under
this Plan shall be subject to the provisions of subsection 7.1.2 of the Plan, in
the case of (i) a merger or consolidation involving the Company in which the
Company is not the surviving corporation (except a merger intended solely to
reincorporate the Company under the laws of a new jurisdiction), (ii) a reverse
merger in which the Company is the surviving corporation but the shares of the
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<PAGE> 27
Company's Common Stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property, whether in the form of
other securities, cash or otherwise, (iii) any other capital reorganization,
liquidation or change in control in which more than fifty percent (50%) of the
shares of the Company entitled to vote are exchanged, (iv) the sale of all or
substantially all of the Company's assets, the Board shall provide for the
acceleration of the exercise date of 50% of the non-exercisable portion of any
outstanding option to the day immediately preceding the closing day of such
transaction, and may provide for the replacement of any options with comparable
options to purchase the stock of such other corporation. All options outstanding
on the date any such event or transaction is consummated shall be terminated in
their entirety.
7.1.2 CONVERSION OF OPTIONS ON STOCK FOR STOCK EXCHANGE. If the
stockholders of the Company receive capital stock of another corporation
("Exchange Stock") in exchange for their shares of Common Stock in any
transaction described in subsection 7.1.1 above, all options granted hereunder
shall be converted into options to purchase shares of Exchange Stock unless the
Company and corporation issuing the Exchange Stock, in their sole discretion,
determine that any or all such options granted hereunder shall not be converted
into options to purchase shares of Exchange Stock but instead shall be treated
and terminated in accordance with the provisions of subsection 7.1.1 of the
Plan. The amount and price of converted options shall be determined by adjusting
the amount and price of the options granted hereunder in the same proportion as
used for determining the number of shares of Exchange Stock the holders of the
Common Stock receive in such merger, consolidation, acquisition of property or
stock, separation or reorganization. Unless the Board determines otherwise, the
converted options shall be fully vested whether or not the vesting requirements
set forth in the Plan or the option agreement have been satisfied.
7.2 FRACTIONAL SHARES. In the event of any adjustment in the
number of shares covered by an option, any fractional shares resulting from such
adjustment shall be disregarded and each such option shall cover only the number
of full shares resulting from such adjustment.
7.3 DETERMINATION OF BOARD TO BE FINAL. All Section 7 adjustments
shall be made by the Board, and its determination as to what adjustments shall
be made, and the extent thereof, shall be final, binding and conclusive. Unless
an Optionee agrees otherwise, any change or adjustment to an incentive stock
option shall be made in such a manner so as not to constitute a "modification"
as defined in Code Section 425(h) and so as not to cause his or her incentive
stock option issued hereunder to fail to continue to qualify as an incentive
stock option as defined in Code Section 422(b).
SECTION 8. SECURITIES REGULATION. Shares shall not be issued with
respect to an option granted under this Plan unless the exercise of such option
and the issuance and delivery of such shares pursuant thereto shall comply with
all relevant provisions of law, including, without limitation, any applicable
state securities laws, the Securities Act of 1933, as amended, the Exchange Act,
the rules and regulations promulgated thereunder, and the requirements of any
stock exchange or inter-dealer quotation system 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, including the availability of an
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<PAGE> 28
exemption from registration for the issuance and sale of any shares hereunder.
Inability of the Company to obtain from any regulatory body having jurisdiction
the authority deemed by the Company's counsel to be necessary for the lawful
issuance and sale of any shares hereunder or the unavailability of an exemption
from registration for the issuance and sale of any shares hereunder shall
relieve the Company of any liability in respect of the nonissuance or sale of
such shares as to which such requisite authority shall not have been obtained.
As a condition to the exercise of an option, the Company may require
the Optionee 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 representation is required by any relevant provision of the aforementioned
laws. At the option of the Company, a stop-transfer order against any shares of
stock may be placed on the official stock books and records of the Company, and
a legend indicating that the stock may not be pledged, sold or otherwise
transferred unless an opinion of counsel is provided (concurred in by counsel
for the Company) stating that such transfer is not in violation of any
applicable law or regulation, may be stamped on stock certificates in order to
assure exemption from registration. The Company may also require such other
action or agreement by the Optionees as it may from time to time deem to be
necessary or advisable. THE COMPANY SHALL NOT BE OBLIGATED, BY REASON OF THIS
PROVISION OR OTHERWISE, TO UNDERTAKE REGISTRATION OF THE OPTIONS OR STOCK
HEREUNDER.
Should any of the Company's capital stock of the same class as the
stock subject to options granted hereunder be listed on a national securities
exchange or inter-dealer quotation system, all stock issued hereunder if not
previously listed on such exchange or inter-dealer quotation system shall be
authorized by that exchange or system for listing thereon prior to the issuance
thereof.
SECTION 9. AMENDMENT AND TERMINATION.
9.1 BOARD ACTION. The Board may at any time suspend, amend or
terminate this Plan, provided that except as set forth in Section 7, the
approval of the holders of a majority of the Company's outstanding shares of
voting capital stock present and entitled to vote at any meeting is necessary
for the adoption by the Board of any amendment which will:
(a) increase the number of shares, which are to be reserved
for the issuance of options under this Plan;
(b) permit the granting of stock options to a class of
persons other than those presently permitted to receive stock options under this
Plan; or
(c) require shareholder approval under applicable law,
including Section 16(b) of the Exchange Act.
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<PAGE> 29
9.2 AUTOMATIC TERMINATION. Unless sooner terminated by the Board,
this Plan shall terminate ten years from the earlier of (a) the date on which
this Plan is adopted by the Board or (b) the date on which this Plan is approved
by the stockholders of the Company. No option may be granted after such
termination or during any suspension of this Plan. The amendment or termination
of this Plan shall not, without the consent of the option holder, alter or
impair any rights or obligations under any option theretofore granted under this
Plan.
SECTION 10 EFFECTIVENESS OF THIS PLAN. This Plan shall become effective
upon approval by the holders of a majority of the Company's outstanding shares
of voting capital stock present and entitled to vote at any meeting at any time
within 12 months after the adoption of this Plan.
Adopted and approved by the Board of Directors on February 16, 2000.
Approved by the stockholders on ____________, 2000.
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<PAGE> 30
SPECTRALINK CORPORATION
NONQUALIFIED STOCK OPTION LETTER AGREEMENT
DATE:______________________________
TO: _______________________________
We are pleased to inform you that you have been selected by the Plan
Administrator of SpectraLink Corporation (the "Company") 2000 Stock Option Plan
(the "Plan") to receive an option under the Plan. The Plan was adopted by the
Board of Directors and approved by the stockholders. When you sign and return to
the Company the Acceptance and Acknowledgment attached to this Stock Option
Agreement you will be entitled to receive a nonqualified option for the purchase
of ________ shares of the Company's common stock, $.01 par value ("Common
Stock"), at an exercise price of $____ per share, subject to the vesting
provisions set forth herein. A copy of the Plan is attached and the provisions
of the Plan are incorporated into this Agreement by reference. THIS OPTION IS
NOT INTENDED TO CONSTITUTE AN INCENTIVE STOCK OPTION, AS THAT TERM IS DEFINED IN
SECTION 422 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
The terms of the option are as set forth in the Plan and in this
Agreement. The most important of the terms set forth in the Plan are summarized
below:
Number of Shares: The option granted to you covers an aggregate of
______ shares of Common Stock.
Exercise Price: The exercise price per share of Common Stock subject to
your option is _____ per share (the "Exercise Price").
Adjustments. The number of shares of Common Stock subject to your
option and the Exercise Price may be subject to adjustment under certain
circumstances as described in the Plan.
Date of Grant: The date of grant of the option is _______________.
Term: The term of the option is ten years from date of grant, unless
sooner terminated.
<PAGE> 31
Vesting: Your option shall vest according to the following schedule,
provided you continue your relationship with the Company or a related
corporation:
Period of Your Continuous
Relationship With the
Company or a Related
Corporation From the Portion of Total Option
Date Option is Granted Which is Exercisable
------------------------- -----------------------
End of 12 months 25%
Each month thereafter 2.083%
48 months 100%
Exercise: The vested portion of the option may be exercised, in whole
or in part, but not as to any fractional shares, during the term of the option.
You should use a Notice of Exercise of Nonqualified Stock Option in the form
attached to this Agreement when you exercise the option. During your lifetime
only you can exercise the option. The Plan also provides for exercise of the
option by the personal representative of your estate or the beneficiary thereof
following your death.
Payment for Shares: The vested portion of this option may be exercised
by the delivery of:
(a) Cash, personal check (unless, at the time of exercise, the Plan
Administrator determines otherwise), certified or bank cashier's checks in an
amount equal to the aggregate Exercise Price for the number of shares as to
which the option is being exercised together with a properly executed Notice of
Exercise;
(b) Unless the Plan Administrator in its sole discretion determines
otherwise, shares of the capital stock of the Company held by you for at least
six months prior to the date of exercise of the option, having a fair market
value at the time of exercise, as determined by the Plan Administrator in
accordance with the Plan, equal to the aggregate Exercise Price for the number
of shares as to which the option is being exercised with properly executed
Notice of Exercise; or
(c) Unless the Plan Administrator in its sole discretion determines
otherwise, a properly executed Notice of Exercise together with irrevocable
instructions to a broker to promptly deliver to the Company the amount of sale
or loan proceeds to pay the aggregate Exercise Price for the number of shares as
to which the option is being exercised;
Upon receipt of written Notice of Exercise and payment and delivery of
any other required documentation, the Company shall deliver to the person
exercising the option a certificate or certificates for the appropriate number
of shares of Common Stock. It shall be a condition to the performance of the
Company's obligation to issue or transfer Common Stock upon exercise of this
option that you pay, or make provision satisfactory to the Company for the
payment of, any taxes, which the Company is obligated to collect with respect to
the issue or transfer of Common Stock upon exercise.
-2-
<PAGE> 32
Termination: Your option will terminate immediately upon termination
for cause, as defined in the Plan, or three months after cessation of your
relationship with the Company or a related corporation, unless cessation is due
to death or total disability, in which case the portion of this option which is
vested at the time of such termination shall terminate one year after cessation
of such relationship. All unvested options will terminate immediately upon the
cessation of your relationship with the Company or a related corporation for any
reason, including, without limitation, termination for cause, resignation, death
or disability.
Transfer of Option: The option is not transferable except by will or by
the applicable laws of descent and distribution or pursuant to a qualified
domestic relations order.
Notice: All notices sent in connection with this option shall be in
writing and, if to the Company, shall be delivered personally to the President
of the Company or mailed to its principal office, addressed to the attention of
the President, and, if to you, shall be delivered personally or mailed to you at
the address noted on the attached Acceptance and Acknowledgment. Such addresses
may be changed at any time by notice from one party to the other.
COMPLIANCE WITH SECURITIES LAWS. YOUR PARTICULAR ATTENTION IS DIRECTED
TO SECTION 8 OF THE PLAN, WHICH DESCRIBES CERTAIN IMPORTANT CONDITIONS RELATING
TO FEDERAL AND STATE SECURITIES LAWS THAT MUST BE SATISFIED BEFORE THE OPTION
CAN BE EXERCISED AND BEFORE THE COMPANY CAN ISSUE ANY SHARES TO YOU. THE COMPANY
HAS NO OBLIGATION TO REGISTER THE SHARES THAT WOULD BE ISSUED UPON THE EXERCISE
OF YOUR OPTION, AND IF IT NEVER REGISTERS THE SHARES, YOU WILL NOT BE ABLE TO
EXERCISE THE OPTION UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE
PRESENT TIME, EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE SECURITIES
LAWS ARE VERY LIMITED AND MIGHT BE UNAVAILABLE TO YOU PRIOR TO THE EXPIRATION OF
THE OPTION. CONSEQUENTLY, YOU MIGHT HAVE NO OPPORTUNITY TO EXERCISE THE OPTION
AND TO RECEIVE SHARES UPON SUCH EXERCISE. IN ADDITION, YOU SHOULD CONSULT WITH
YOUR TAX ADVISOR CONCERNING THE RAMIFICATIONS TO YOU OF HOLDING OR EXERCISING
YOUR OPTIONS OR HOLDING OR SELLING THE SHARES UNDERLYING SUCH OPTIONS.
Compliance with Section 16 of the Securities Exchange Act of 1934. It
is the intention of the Company that this Plan comply in all respects with
Section 16(b) and Rule 16b-3 under the Securities Exchange Act of 1934 (the
"Exchange Act"), to the extent applicable, and, if any Plan provision is later
found not to be in compliance with such Section or Rule, as the case may be, the
provision shall be deemed null and void, and in all events the Plan shall be
construed in favor of its meeting the requirements of Section 16(b) and Rule
16b-3 under the Exchange Act. Notwithstanding anything in the Plan to the
contrary, the Board, in its absolute discretion, may bifurcate the Plan so as to
restrict, limit or condition the use of any provision of the Plan to
participants who are officers and directors or other persons subject to Section
16(b) of the Exchange Act without so restricting, limiting or conditioning the
Plan with respect to other participants.
Plan Interpretation. All decisions or interpretations made by the Plan
Administrator with regard to any question arising hereunder or under the Plan
shall be binding and conclusive on the Company and you.
-3-
<PAGE> 33
Binding Effect. This Agreement shall bind and inure to the benefit of
the parties hereto and the successors and assigns of the Company and, to the
extent provided in the Plan, your executors, administrators, legatees and heirs.
Please execute the Acceptance and Acknowledgment set forth below on the
enclosed copy of this Agreement and return it to the Company, to the attention
of the undersigned.
Very truly yours,
SpectraLink Corporation
By:
----------------------------
-4-
<PAGE> 34
ACCEPTANCE AND ACKNOWLEDGMENT
I, a resident of the State of ______________, accept the nonqualified
stock option described above in the SpectraLink Corporation 2000 Stock Option
Plan, and acknowledge receipt of a copy of this Agreement, including a copy of
the Plan. I have read and understand this Agreement and the Plan, including (but
not limited to) the provisions of Section 8 of the Plan. I have also read and
signed the Notice of Grant of Stock Options and Option Agreement.
Dated:
-----------------------------
- ------------------------------------
Print Name
- ------------------------------------ ---------------------------------
Signature Taxpayer I.D. Number
By his or her signature below, the spouse of the Optionee, if such
Optionee is legally married as of the date of his or her execution of this
Agreement, acknowledges that he or she has read this Agreement and the Plan and
is familiar with the terms and provisions thereof, and agrees to be bound by all
the terms and conditions of this Agreement and the Plan.
Dated:
-----------------------------
- ------------------------------------
Print Name
- ------------------------------------
Spouse's Signature
<PAGE> 35
NOTICE OF EXERCISE
SpectraLink Corporation
5755 Central Avenue
Boulder, Colorado 80301-2848
Re: Exercise of Stock Option
Ladies and Gentlemen:
I hereby exercise my right to purchase shares of Common Stock (the
"Shares") of SpectraLink Corporation, a Delaware corporation, pursuant to, and
in accordance with, the SpectraLink Corporation 2000 Nonqualified Stock Option
Agreement ("Agreement") dated . As provided in that Agreement, I deliver
herewith a certified or bank cashier's check in the amount of the aggregate
option price (unless alternative payment methods have been approved by the Plan
Administrator, in which case, payment of the exercise price is hereby tendered
in accordance with such method). Please deliver to me stock certificates
representing the subject shares registered as follows:
Name:
------------------------------------------
Address:
---------------------------------------
---------------------------------------
Social Security Number:
-----------------------
The aggregate exercise price is $___________________ (total number of
shares to be purchased x $________________________ per share).
1. If the sale of the Shares and the resale thereof has not, prior to
the date hereof, been registered pursuant to a registration statement filed and
declared effective under the Securities Act of 1933, as amended (the "Act"), I
hereby agree, represent, and warrant that:
(a) I am acquiring the Shares for my own account (and not for the
account of others), for investment and not with a view to the distribution or
resale thereof;
(b) by virtue of my position, I have access to the same kind of
information, which would be available in a registration statement filed under
the Act;
(c) I am a sophisticated investor and am capable of protecting my
own interests in connection with this transaction;
(d) I understand that I may not sell or otherwise dispose of the
Shares in the absence of either (i) a registration statement filed under the Act
or (ii) an exemption from the registration provisions thereof; and
<PAGE> 36
(e) the certificates representing the Shares may contain a legend
to the effect of subsection (d) of this Section 1.
2. If the sale of the Shares and the resale thereof has been registered
pursuant to a registration statement filed and declared effective under the Act,
the undersigned hereby represents and warrants that he or she has received the
applicable prospectus and a copy of the Company's most recent Annual Report, as
well as all other material sent to stockholders generally.
3. I acknowledge that the number of shares of Common Stock subject to
the Agreement is hereafter reduced by the number of shares of Common Stock
represented by the Shares.
4. I understand that there are certain tax implications of my exercise
of my right to purchase shares of Common Stock pursuant to the exercise of this
option. I also understand that it is my obligation to confer with my own tax
advisor with respect to such tax implications, and to the extent I felt it
necessary, I have done so prior to exercising this option.
Very truly yours,
------------------------------------
(Signature)
------------------------------------
(Please type or print name)
-2-
<PAGE> 37
SPECTRLINK CORPORATION
INCENTIVE STOCK OPTION LETTER AGREEMENT
DATE:______________________________
TO: _______________________________
We are pleased to inform you that you have been selected by the Plan
Administrator of the SpectraLink Corporation (the "Company") 2000 Stock Option
Plan (the "Plan"). The Plan was adopted by the Board of Directors, and approved
by the stockholders. When you sign and return to the Company the Acceptance and
Acknowledgment attached to this Stock Option Agreement you will be entitled to
receive an incentive option for the purchase of __________________________
shares of the Company's common stock, $.01 par value ("Common Stock"), at an
exercise price of $______________ per share subject to the vesting provisions
set forth herein. A copy of the Plan is attached and the provisions of the Plan
are incorporated into this Agreement by reference.
The terms of the option are as set forth in the Plan and in this
Agreement. The most important of the terms set forth in the Plan are summarized
as follows:
Number of Shares: The option granted to you covers an aggregate of
_______________ shares of Common Stock.
Exercise Price: The exercise price per share of Common Stock subject to
your option is $_____ per share (the "Exercise Price").
Adjustments. The number of shares of Common Stock subject to your
option and the Exercise Price may be subject to adjustment under certain
circumstances as described in the Plan.
Date of Grant: The date of grant of the option is
______________________.
Term. The term of the option is ten years from date of grant, unless
sooner terminated.
<PAGE> 38
Vesting: Your option shall vest according to the following schedule,
provided you continue your relationship with the Company or a related
corporation:
Period of Your Continuous
Relationship With the
Company or a Related
Corporation From the Portion of Total Option
Date Option is Granted Which is Exercisable
------------------------- -----------------------
End of 12 months 25%
Each month thereafter 2.083%
48 months 100%
Exercise. The vested portion of the option may be exercised, in whole
or in part, but not as to any fractional shares, during the term of the option.
You should use a Notice of Exercise of Incentive Stock Option in the form
attached to this Agreement when you exercise the option. During your lifetime
only you can exercise the option. The Plan also provides for exercise of the
option by the personal representative of your estate or the beneficiary thereof
following your death.
Payment for Shares. The vested portion of this option may be exercised
by the delivery of:
(a) Cash, personal check (unless at the time of exercise the Plan
Administrator determines otherwise), or certified or bank cashier's checks in an
amount equal to the aggregate Exercise Price for the number of shares as to
which the option is being exercised together with a properly executed Notice of
Exercise;
(b) Unless the Plan Administrator in its sole discretion determines
otherwise, a properly executed Notice of Exercise, together with shares of the
capital stock of the Company held by you for at least six months prior to the
date of exercise of the option, having a fair market value at the time of
exercise, as determined by the Plan Administrator in accordance with the Plan,
equal to the aggregate Exercise Price for the number of shares as to which the
option is being exercised; or
(c) Unless the Plan Administrator in its sole discretion determines
otherwise, a properly executed Notice of Exercise together with irrevocable
instructions to a broker to promptly deliver to the Company the amount of sale
or loan proceeds to pay the aggregate Exercise Price for the number of shares as
to which the option is being exercised.
Upon receipt of written Notice of Exercise and payment and delivery of
any other required documentation, the Company shall deliver to the person
exercising the option a certificate or certificates for the appropriate number
of shares of Common Stock. It shall be a condition to the performance of the
Company's obligation to issue or transfer Common Stock upon exercise of this
option that you pay, or make provision satisfactory to the Company for the
payment of, any taxes, which the Company is obligated to collect with respect to
the issue or transfer of Common Stock upon exercise.
-2-
<PAGE> 39
Termination. Your option will terminate immediately upon termination
for cause, as defined in the Plan, or 90-days after cessation of your
relationship with the Company or a related corporation thereof, unless cessation
is due to death or total disability, in which case the portion of this option
which is vested at the time of such termination shall terminate one year after
cessation of such relationship. All unvested options will terminate immediately
upon the cessation of your relationship with the Company or a related
corporation for any reason, including, without limitation, termination for
cause, resignation, death or disability.
Transfer of Option. The option is not transferable except by will or by
the applicable laws of descent and distribution or pursuant to a qualified
domestic relations order.
Notice: All notices sent in connection with this option shall be in
writing and, if to the Company, shall be delivered personally to the President
of the Company or mailed to its principal office, addressed to the attention of
the President, and, if to you, shall be delivered personally or mailed to you at
the address noted on the attached Acceptance and Acknowledgment. Such addresses
may be changed at any time by notice from one party to the other.
COMPLIANCE WITH SECURITIES LAWS. YOUR PARTICULAR ATTENTION IS DIRECTED
TO SECTION 8 OF THE PLAN, WHICH DESCRIBES CERTAIN IMPORTANT CONDITIONS RELATING
TO FEDERAL AND STATE SECURITIES LAWS THAT MUST BE SATISFIED BEFORE THE OPTION
CAN BE EXERCISED AND BEFORE THE COMPANY CAN ISSUE ANY SHARES TO YOU. THE COMPANY
HAS NO OBLIGATION TO REGISTER THE SHARES THAT WOULD BE ISSUED UPON THE EXERCISE
OF YOUR OPTION, AND IF IT NEVER REGISTERS THE SHARES, YOU WILL NOT BE ABLE TO
EXERCISE THE OPTION UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE
PRESENT TIME, EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE SECURITIES
LAWS ARE VERY LIMITED AND MIGHT BE UNAVAILABLE TO YOU PRIOR TO THE EXPIRATION OF
THE OPTION. CONSEQUENTLY, YOU MIGHT HAVE NO OPPORTUNITY TO EXERCISE THE OPTION
AND TO RECEIVE SHARES UPON SUCH EXERCISE. IN ADDITION, YOU SHOULD CONSULT WITH
YOUR TAX ADVISOR CONCERNING THE RAMIFICATIONS TO YOU OF HOLDING OR EXERCISING
YOUR OPTIONS OR HOLDING OR SELLING THE SHARES UNDERLYING SUCH OPTIONS.
Compliance with Section 16 of the Securities Exchange Act of 1934. It
is the intention of the Company that this Plan comply in all respects with
Section 16(b) and Rule 16b-3 under the Securities Exchange Act of 1934 (the
"Exchange Act"), to the extent applicable, and, if any Plan provision is later
found not to be in compliance with such Section or Rule, as the case may be, the
provision shall be deemed null and void, and in all events the Plan shall be
construed in favor of its meeting the requirements of Section 16(b) and Rule
16b-3 under the Exchange Act. Notwithstanding anything in the Plan to the
contrary, the Board, in its absolute discretion, may bifurcate the Plan so as to
restrict, limit or condition the use of any provision of the Plan to
participants who are officers and directors or other persons subject to Section
16(b) of the Exchange Act without so restricting, limiting or conditioning the
Plan with respect to other participants.
Plan Interpretation. All decisions or interpretations made by the Plan
Administrator with regard to any question arising hereunder or under the Plan
shall be binding and conclusive on the Company and you.
-3-
<PAGE> 40
Binding Effect. This Agreement shall bind and inure to the benefit of
the parties hereto and the successors and assigns of the Company and, to the
extent provided in the Plan, your executors, administrators, legatees and heirs.
Please execute the Acceptance and Acknowledgment set forth below on the
enclosed copy of this Agreement and return it to the undersigned.
Very truly yours,
SpectraLink Corporation
By:
------------------------------
-4-
<PAGE> 41
ACCEPTANCE AND ACKNOWLEDGMENT
I, a resident of the State of , accept the stock option described above
granted under the SpectraLink Corporation 2000 Stock Option Plan, and
acknowledge receipt of a copy of this Agreement, including a copy of the Plan. I
have read and understand this Agreement and the Plan, including the provisions
of Section 8 thereof. I have also read and signed the Notice of Grant of Stock
Options and Option Agreement.
Dated:
-------------------------------
- -------------------------------------- -----------------------------------
Signature Taxpayer I.D. Number
By his or her signature below, the spouse of the Optionee, if such
Optionee is legally married as of the date of such Optionee's execution of this
Agreement, acknowledges that he or she has read this Agreement and the Plan and
is familiar with the terms and provisions thereof, and agrees to be bound by all
the terms and conditions of this Agreement and the Plan.
Dated:
--------------------------------
- --------------------------------------
Spouse's Signature
- --------------------------------------
Printed Name
<PAGE> 42
NOTICE OF EXERCISE
SpectraLink Corporation
5755 Central Avenue
Boulder, Colorado 80301-2848
Ladies and Gentlemen:
I hereby exercise my right to purchase ________________ shares of
Common Stock (the "Shares") of SpectraLink Corporation, a Delaware corporation,
pursuant to, and in accordance with, the SpectraLink Corporation 2000 Incentive
Stock Option Agreement ("Agreement") dated ___________________. As provided in
that Agreement, I deliver herewith a certified or bank cashier's check in the
amount of the aggregate option price (unless alternative payment methods have
been approved by the Plan Administrator, in which case, payment of the exercise
price is hereby tendered in accordance with such method). Please deliver to me
stock certificates representing the subject shares registered as follows:
Name:
-----------------------------------
Address:
--------------------------------
--------------------------------
Social Security Number:
-----------------
The aggregate exercise price is $______________________ (total number
of shares to be purchased x $____________________ per share).
1. If the sale of the Shares and the resale thereof has not, prior to
the date hereof, been registered pursuant to a registration statement filed and
declared effective under the Securities Act of 1933, as amended (the "Act"), I
hereby agree, represent, and warrant that:
(a) I am acquiring the Shares for my own account (and not for the
account of others), for investment and not with a view to the distribution or
resale thereof;
(b) by virtue of my position, I have access to the same kind of
information, which would be available in a registration statement filed under
the Act;
(c) I am capable of protecting my own interests in connection with
this transaction;
(d) I understand that I may not sell or otherwise dispose of the
Shares in the absence of either (i) a registration statement filed under the Act
or (ii) an exemption from the registration provisions thereof; and
(e) the certificates representing the Shares may contain a legend
to the effect of subsection (d) of this Section 1.
<PAGE> 43
2. If the sale of the Shares and the resale thereof has been registered
pursuant to a registration statement filed and declared effective under the Act,
I hereby represent and warrant that I have received the applicable Prospectus
and a copy of the Company's most recent Annual Report, as well as all other
material sent to stockholders generally.
3. I acknowledge that the number of shares of Common Stock subject to
the Agreement is hereafter reduced by the number of shares of Common Stock
represented by the Shares.
4. I understand that there are certain tax implications of my exercise
of my right to purchase shares of Common Stock pursuant to the exercise of this
option. I also understand that it is my obligation to confer with my own tax
advisor with respect to such tax implications, and to the extent I felt it
necessary, I have done so prior to exercising this option.
Very truly yours,
----------------------------------
(Signature)
----------------------------------
(Please type or print name)
<PAGE> 44
FROM SPECTRALINK CORPORATION
ELLEN VINESKI, 303-440-5330
PROXY
SPECTRALINK CORPORATION
5755 Central Avenue
Boulder, Colorado 80301
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Bruce M. Holland and Nancy K. Hamilton each
with the power to appoint his substitute and hereby authorizes them to
represent and to vote as designated on the reverse side, all shares of common
stock of SpectraLink Corporation (the "Company") held of record by the
undersigned on March 8, 2000 at the Annual Meeting of Stockholders to be held
on May 24, 2000 and any adjournment thereof.
THIS PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED. IF NO DIRECTION
IS GIVEN WITH RESPECT TO A PARTICULAR PROPOSAL, THIS PROXY WILL BE VOTED FOR
SUCH PROPOSAL.
PLEASE MARK, DATE, SIGN, AND RETURN THIS PROXY CARD PROMPTLY, USING THE
ENVELOPE, NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE.
<PAGE> 45
FROM SPECTRALINK CORPORATION
ELLEN VINESKI, 303-440-5330
Dear Stockholder:
Please take note of the important information enclosed with this Proxy. There
are a number of issues related to the operation of the Company that require
your immediate attention.
Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.
Please mark the boxes on the proxy card to indicate how your shares will be
voted. Then sign the card, detach it, and return your Proxy in the enclosed
postage paid envelope.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
SpectraLink Corporation
<PAGE> 46
FROM SPECTRALINK CORPORATION
ELLEN VINESKI, 303-440-5330
[X] Pleases mark votes as in this example
<TABLE>
<S> <C>
For Against Abstain
1. Election of Directors 4. Proposal to ratify [ ] [ ] [ ]
the selection of
NOMINEES: Bruce M. Holland, Carl D. Carman, Arthur Anderson LLP,
Anthony V. Carollo, Jr., Burton J. McMurtry, independent public
accountants, as
For Withheld auditors.
[ ] [ ] In their discretion, the proxies are authorized to
vote upon any other business that may properly
[ ] come before the meeting.
------------------------------------------
For all nominees except noted above Mark here for address change. [ ]
For Against Abstain
2. Proposal to approve [ ] [ ] [ ]
the company's
2000 stock option
plan. Please sign exactly as your name appears hereon.
Joint owners should each sign. Executors,
For Against Abstain administrators, trustees, guardians, or other
fiduciaries should give full title as such. If
3. Proposal to amend [ ] [ ] [ ] signing for a corporation, please sign in full
the company's corporate name by a duly authorized officer.
stock purchase
plan.
Signature: Date: Signature: Date:
----------------------- ------- ----------------------- -------
</TABLE>
