-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PL4fsQRv/X5fJl9o0yz7CQCnK4wLlBYI/USEguKREMhtQeA5jVWQK5bjGq8BOURV qFYha78IoiP5V6YzCN2Qkg== 0001047469-99-014723.txt : 19990415 0001047469-99-014723.hdr.sgml : 19990415 ACCESSION NUMBER: 0001047469-99-014723 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19990414 EFFECTIVENESS DATE: 19990414 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DIGITAL MICROWAVE CORP /DE/ CENTRAL INDEX KEY: 0000812703 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 770016028 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-76233 FILM NUMBER: 99593152 BUSINESS ADDRESS: STREET 1: 170 ROSE ORCHARD WAY CITY: SAN JOSE STATE: CA ZIP: 95134 BUSINESS PHONE: 4089430777 MAIL ADDRESS: STREET 1: 170 ROSE ORCHARD WAY CITY: SAN JOSE STATE: CA ZIP: 95134 S-8 1 FORM S-8 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 14, 1999. REGISTRATION NO. 333-_______ - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 DIGITAL MICROWAVE CORPORATION (Exact Name of Registrant as Specified in Its Charter) DELAWARE 77-0016028 (State or Other Jurisdiction (I.R.S. Employer Identification No.) of Incorporation or Organization) 170 ROSE ORCHARD WAY, SAN JOSE, CA 95134 (Address of Principal Executive Offices) (Zip Code) DIGITAL MICROWAVE CORPORATION 1999 NON-OFFICER EMPLOYEE RESTRICTED STOCK PURCHASE PLAN (Full Title of the Plan) CHARLES D. KISSNER CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER DIGITAL MICROWAVE CORPORATION 170 ROSE ORCHARD WAY SAN JOSE, CA 95134 (Name and Address of Agent For Service) 408/943-0777 (Telephone Number, Including Area Code, of Agent For Service) With a copy to: Bruce Alan Mann, Esq. Morrison & Foerster LLP 425 Market Street San Francisco, CA 94105 - -------------------------------------------------------------------------------- Calculation of Registration Fee
- -------------------------------------------------------------------------------- Proposed Proposed Title of Number of Maximum Maximum Amount of Securities to shares to be Offering Price Aggregate Registration be Registered Registered Per Share Offering Price Fee - -------------------------------------------------------------------------------- Common Stock 160,643 $7.59* $1,219,280.37 $338.96 - --------------------------------------------------------------------------------
* Calculated solely for purposes of this offering under Rule 457(h) of the Securities Act of 1933 on the basis of the average of the high and low price per share of Digital Microwave Corporation's Common Stock on the Nasdaq National Market on April 8, 1999. Part I INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS The documents containing the information specified in Part I of Form S-8 (plan information and registrant information and employee plan annual information) will be sent or given to employees as specified by Rule 428(b)(1) of the Securities Act of 1933, as amended (the "Securities Act"). Such document need not be filed with the Securities and Exchange Commission either as part of this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424 of the Securities Act. These documents and the documents incorporated by reference in this Registration Statement pursuant to Item 3 of Form S-8 (Part II hereof), taken together, constitute a prospectus that meets the requirements of Section 10(a) of the Securities Act. I-1 Part II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE Digital Microwave Corporation (the "Registrant") hereby incorporates by reference into this Registration Statement the following documents previously filed with the Securities and Exchange Commission (the "SEC"). (a) The Registrant's latest prospectus filed with the SEC on September 9, 1998, pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "Securities Act"). (b) The Registrant's latest Annual Report on Form 10-K and on Form 10-K/A for the fiscal year ended March 31, 1998 filed with the SEC on June 29, 1998 and July 20, 1998, respectively, pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). (c) The Registrant's Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1998 filed with the SEC on August 14, 1998, pursuant to Section 13(a) of the Exchange Act. (d) The Registrant's Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 1998 filed with the SEC on November 16, 1998, pursuant to Section 13(a) of the Exchange Act. (e) The Registrant's Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 1998 filed with the SEC on February 16, 1999, pursuant to Section 13(a) of the Exchange Act. (f) The Registrant's Current Reports on Form 8-K dated April 3, 1998, July 29, 1998 and October 20, 1998, each filed pursuant to Section 13(a) of the Exchange Act. (g) The Registrant's Registration Statement No. 0-15895 on Form 8-A filed with the SEC on May 22, 1987, in which there is described the terms, rights and provisions applicable to the Registrant's outstanding Common Stock. All reports and definitive proxy or information statements filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, after the date of this Registration Statement and prior to the filing of a post-effective amendment which indicates that all securities offered hereby have been sold or which deregisters all securities then remaining unsold shall be deemed to be incorporated by reference into this Registration Statement and to be a part hereof from the date of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration II-1 Statement to the extent that a statement contained herein or in any subsequently filed document which also is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement. Item 4. DESCRIPTION OF SECURITIES Not Applicable. ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL Not Applicable. ITEM 6. INDEMNIFICATION OF DIRECTOR AND OFFICERS The Registrant's Restated Certificate of Incorporation provides that no director of the Registrant will be personally liable to the Registrant or any of its stockholders for monetary damages arising from the director's breach of his fiduciary duties. However, such exemption from liability does not apply with respect to any action in which the director would be liable under Section 174 of Title 8 of the Delaware General Corporation Law ("Delaware Law"), nor does it apply with respect to any liability in which the director (i) breached his duty of loyalty to the Registrant; (ii) did not act in good faith or, in failing to act, did not act in good faith; (iii) acted in a manner involving intentional misconduct or knowing violation of law or, in failing to act, acted in a manner involving intentional misconduct or knowing violation of law; or (iv) derived an improper personal benefit. Pursuant to the provisions of Section 145 of Delaware Law, the Registrant as a Delaware corporation has the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding (other than an action by or in the right of the Registrant) by reason of the fact that he or she is or was a director, officer, employee or agent of the Registrant or of any corporation, partnership, joint venture, trust or other enterprise for which he or she is or was serving in such capacity at the request of the Registrant, against any and all expenses, judgments, fines and amounts paid in settlement which were reasonably incurred by him or her in connection with such action, suit or proceeding. The power to indemnify applies only if such person acted in good faith and in a manner he or she reasonably believed to be in the best interests, or not opposed to the best interests, of the Registrant and, with respect to any criminal action or proceeding, if he or she had no reasonable cause to believe his or her conduct was unlawful. The power to indemnify also applies to actions brought by or in the right of the Registrant, but only to the extent of defense and settlement expenses and not to the satisfaction of a judgment or settlement of the claim itself. In such actions, however, no indemnification will be made if there is any adjudication of negligence or misconduct, unless the court, in its discretion, finds that in the light of all the circumstances indemnification should apply. II-2 To the extent any such person is successful in the defense of the actions referred to above, such person is entitled pursuant to Section 145 of Delaware Law to indemnification as described above. Section 145 also grants the power to advance litigation expenses upon receipt of an undertaking to reply such advances in the event no right to indemnification is subsequently shown. A corporation may also obtain insurance at its expense to protect anyone who might be indemnified, or has a right to insist on indemnification, under the statute. The Registrant has entered into indemnification agreements with its directors and certain officers which provide for indemnification to the fullest extent permitted by Delaware Law, including Section 145 thereof. The Registrant may also enter into similar agreements from time to time with future directors and/or present or future officers of the Registrant. ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED Not Applicable. ITEM 8. EXHIBITS
Exhibit No. Description - ------------ ----------- 5.1 Opinion of Morrison & Foerster LLP as to the legality of the securities being registered. 23.1 Consent of Arthur Andersen LLP, Independent Public Accountants. 23.2 Consent of Morrison & Foerster LLP (contained in the opinion of counsel filed as Exhibit 5.1 to this Registration Statement). 24.1 Power of Attorney (set forth on the signature page of this Registration Statement). 99.1 Digital Microwave Corporation 1999 Non-Officer Employee Restricted Stock Purchase Plan.
ITEM 9. UNDERTAKINGS A. The undersigned Registrant hereby undertakes: (1) to file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement (i) to include any prospectus required by Section 10(a)(3) of the Securities Act, (ii) to reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement, and (iii) to include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement, provided, however, that clauses (1)(i) and (1)(ii) shall not apply if the information required to be included in a post-effective amendment by those paragraphs is II-3 contained in periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference into this Registration Statement; (2) that for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and (3) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold upon the termination of the Registrant's 1999 Non-Officer Employee Restricted Stock Purchase Plan. B. The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference into this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. C. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or controlling persons of the Registrant pursuant to the indemnity provisions summarized in Item 6 above or otherwise, the Registrant has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Jose, State of California, on April 14, 1999. DIGITAL MICROWAVE CORPORATION By: /s/ CHARLES D. KISSNER ------------------------------------------ Charles D. Kissner Chairman of the Board and Chief Executive Officer II-4 POWER OF ATTORNEY AND ADDITIONAL SIGNATURES Each person whose signature appears below constitutes and appoints Charles D. Kissner and Carl A. Thomsen, and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments to this Registration Statement, including post-effective amendments, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do so and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes, may lawfully do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the date indicated.
Signature Title Date - --------------------------- -------------------------- -------------- /s/ CHARLES D. KISSNER - --------------------------- Charles D. Kissner Chairman of the Board and April 14, 1999 Chief Executive Officer /s/ RICHARD C. ALBERDING - --------------------------- Richard C. Alberding Director April 14, 1999 /s/ PAUL S. BACHOW - --------------------------- Paul S. Bachow Director April 14, 1999 /s/ JOHN W. COMBS - --------------------------- John W. Combs Director April 14, 1999 /s/ CLIFFORD H. HIGGERSON - --------------------------- Clifford H. Higgerson Director April 14, 1999 /s/ JAMES D. MEINDL - --------------------------- James D. Meindl Director April 14, 1999 /s/ V. FRANK MENDICINO - --------------------------- V. Frank Mendicino Director April 14, 1999 II-5 Signature Title Date - --------------------------- -------------------------- -------------- /s/ BILLY B. OLIVER - --------------------------- Billy B. Oliver Director April 14, 1999 /s/ HOWARD ORINGER - --------------------------- Howard Oringer Director April 14, 1999 /s/ CARL A. THOMSEN - --------------------------- Carl A. Thomsen Vice President, Chief April 14, 1999 Financial Officer and Secretary (Principal Financial and Accounting Officer)
II-6 EX-5.1 2 EXHIBIT 5.1 EXHIBIT 5.1 April 13, 1999 Digital Microwave Corporation 170 Rose Orchard Way San Jose, California 95134 Ladies and Gentlemen: At your request, we have examined the Registration Statement on Form S-8 to be filed by Digital Microwave Corporation, a Delaware corporation (the "Company"), with the Securities and Exchange Commission in connection with the registration under the Securities Act of 1933, as amended, of 160,643 shares of the Company's common stock, $0.01 par value per share (the "Common Stock"). As counsel to the Company, we have examined the proceedings taken by the Company in connection with the reservation of the 160,643 additional shares of the Common Stock to be reserved for issuance under the Company's 1999 Non-Officer Employee Restricted Stock Purchase Plan. It is our opinion that the 160,643 shares of Common Stock which may be issued and sold by the Company, when issued and sold in the manner referred to in the Registration Statement, will be legally and validly issued, fully paid and nonassessable. We consent to the use of this opinion as an exhibit to the Registration Statement and further consent to all references to us in the Registration Statement and any further amendments thereto. Very truly yours, /s/ MORRISON & FOERSTER LLP EX-23.1 3 EXHIBIT 23.1 EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this registration statement of our reports dated April 21, 1998 included in or incorporated by reference in Digital Microwave Corporation's Form 10-K for the year ended March 31, 1998. /s/ ARTHUR ANDERSEN LLP San Jose, California April 12, 1999 EX-99.1 4 EX-99.1 EXHIBIT 99.1 DIGITAL MICROWAVE CORPORATION 1999 NON-OFFICER EMPLOYEE RESTRICTED STOCK PURCHASE PLAN The following constitutes the provisions of the 1999 Non-Officer Employee Restricted Stock Purchase Plan of Digital Microwave Corporation. 1. PURPOSE. The purpose of the Plan is to provide Employees (excluding Officers) of the Company with the opportunity to use their ESPP Account Balance to purchase Restricted Shares. 2. DEFINITIONS. As used herein, the following definitions shall apply: (a) "APPLICABLE LAWS" means the legal requirements relating to the administration of the Plan, if any, under applicable provisions of federal securities laws, state corporate and securities laws, the Code, the rules of any applicable stock exchange or national market system, and the rules of any foreign jurisdiction applicable to participation in the Plan by residents therein. (b) "BOARD" means the board of directors of the Company. (c) "CHANGE IN CONTROL" means a change in ownership or control of the Company effected through the direct or indirect acquisition by any person or related group of persons (other than an acquisition from or by the Company or by a Company-sponsored employee benefit plan or by a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities. (d) "CODE" means the Internal Revenue Code of 1986, as amended. (e) "COMMON STOCK" means the common stock of the Company. (f) "COMPANY" means Digital Microwave Corporation, a Delaware corporation. (g) "CONSULTANT" means any person (other than an Employee or a Director, solely with respect to rendering services in such person's capacity as a Director) who is engaged by the Company or any Related Entity to render consulting or advisory services to the Company or such Related Entity. (h) "CONTINUOUS SERVICE" means the provision of services to the Company or a Related Entity in any capacity by an Employee that is not interrupted or terminated. Continuous Service shall not be considered interrupted in the case of (i) any approved leave of absence, (ii) transfers among the Company, any Related Entity, or any successor, in any capacity of 1 Employee, Director or Consultant or (iii) any change in status as long as the individual remains in the service of the Company or a Related Entity in any capacity of Employee, Director or Consultant. (i) "CORPORATE TRANSACTION" means any of the following transactions: (i) a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the state in which the Company is incorporated; (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company (including the capital stock of the Company's subsidiary corporations) in connection with complete liquidation or dissolution of the Company; (iii) any reverse merger in which the Company is the surviving entity but in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such merger; or (iv) an acquisition by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities (whether or not in a transaction also constituting a Change in Control), but excluding any such transaction that the Plan Administrator determines shall not be a Corporate Transaction. (j) "DIRECTOR" means a member of the Board or the board of directors of any Related Entity. (k) "EMPLOYEE" means any individual (excluding Officers) who performs services while in the employ of the Company or a Related Entity, subject to the control and direction of the employer entity not only as to the work to be performed but also as to the manner and method of performance. (l) "ESPP ACCOUNT BALANCE" means the amount of contributions withheld from a Participant's compensation under the Company's 1996 Employee Stock Purchase Plan for the period beginning on September 1, 1998 and ending on February 28, 1999, that was not refunded to the Participant or used to purchase Common Stock under the Company's 1996 Employee Stock Purchase Plan. (m) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. (n) "OFFICER" means a person who is an officer of the Company or a Related Entity within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder. 2 (o) "PARENT" means a corporation that owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in the Company. (p) "PARTICIPANT" means an Employee of the Company or a Related Entity who selects "Alternative 2 - Restricted Stock Plan" on the DMC ESPP Participation Statement and returns such Statement to the Company's San Jose Personnel Office by noon Pacific Standard Time on March 8, 1999. (q) "PARTICIPANT ELECTION DATE" means the date on which an Employee of the Company or a Related Entity becomes a Participant. (r) "PLAN" means this 1999 Non-Officer Employee Restricted Stock Purchase Plan. (s) "PLAN ADMINISTRATOR" means either the Board or a committee of the Board that is responsible for the administration of the Plan as is designated from time to time by resolution of the Board. (t) "PURCHASE PRICE" means an amount equal to a Participant's purchase price for a share of Common Stock under the Company's 1996 Employee Stock Purchase Plan for the period beginning on September 1, 1998, and ending on February 28, 1999. (u) "RELATED ENTITY" means any Parent, Subsidiary and any business, corporation, partnership, limited liability company or other entity in which the Company, a Parent or a Subsidiary holds a substantial ownership interest, directly or indirectly (v) "RESTRICTED SHARES" means the Shares sold to a Participant under this Plan that have not vested in accordance with Section 5. (w) "SHARES" means shares of Common Stock sold under this Plan. (x) "SUBSIDIARY" means each corporation (other than the Company) in an unbroken chain of corporations beginning with the Company, provided each such corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in any other corporation in such chain. (y) "TOTAL NUMBER OF RESTRICTED SHARES AWARDED" means the whole number of Restricted Shares determined by dividing a Participant's ESPP Account Balance by the Participant's Purchase Price disregarding any resulting fractional Restricted Shares. 3. STOCK SUBJECT TO THE PLAN. The number of Shares reserved for sale under the Plan shall be 160,643 Shares. 3 4. PURCHASE OF SHARES. The Company hereby sells to each Participant the Total Number of Restricted Shares Awarded calculated for such Participant. Payment for the Total Number of Restricted Shares Awarded shall be made automatically to the Company from the Participant's ESPP Account Balance on the Participant Election Date without further action by the Participant. 5. VESTING OF SHARES. (a) Subject to the Participant's Continuous Service and other limitations set forth in this Plan, the Participant's Restricted Shares will "vest" in accordance with the following schedule: one-twelfth (1/12) of the Total Number of Restricted Shares Awarded shall vest on April 21, 1999, and one-twelfth (1/12) of the Total Number of Restricted Shares Awarded shall vest on the third Wednesday of each month thereafter until the Restricted Shares are fully vested. (b) For purposes of this Plan, the term "vest" shall mean, with respect to any Restricted Shares, that such Restricted Shares are no longer subject to cancellation and shall be released to the Participant without restrictions, subject to satisfaction of any withholding obligations provided in Section 7. If the Participant would become vested in a fraction of a Restricted Share, such fraction of a Restricted Share shall not vest until the Participant becomes vested in the entire Restricted Share. (c) The Participant shall have full stockholder rights with respect to the Shares sold to the Participant pursuant to Section 4, whether or not they are Restricted Shares. Accordingly, the Participant shall have the right to vote such Restricted Shares and to receive any regular cash dividends paid on such Restricted Shares, less any applicable withholding obligations. Any new, additional or different shares of stock or other property (including money paid other than as a regular cash dividend) which the Participant may have the right to receive with respect to his or her Restricted Shares by reason of any stock dividend, stock split, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class shall be subject to the same vesting requirements applicable to the Participant's Restricted Shares. (d) If a Participant's Continuous Service terminates for any reason, with or without cause (including death or disability), any Restricted Shares that have not vested as of the date the Participant's Continuous Service terminates (the "Termination Date") shall be cancelled by the Company and the Participant shall have no further stockholder rights or other interests or rights with respect to those Restricted Shares. Upon such cancellation, the Company shall become the legal and beneficial owner of the Restricted Shares and all rights and interest therein and related thereto, and the Company shall have the right to transfer to its own name such Restricted Shares, without any further action by the Participant or his or her successor in interest. Within thirty (30) days of the Termination Date, the Company shall repay to the Participant or the Participant's estate an amount of cash equal to the number of canceled Restricted Shares multiplied by the Purchase Price (disregarding any resulting fractional cents), such amount to be paid without any interest. 4 (e) Notwithstanding the terms of Section 5(a), in the event of the Participant's change in status from Employee to Director or Consultant, the vesting of the Restricted Shares shall continue only to the extent determined by the Plan Administrator as of such change in status. 6. TRANSFER RESTRICTIONS. The Restricted Shares sold to the Participant hereunder may not be sold, transferred by gift, pledged, hypothecated, or otherwise transferred or disposed of by the Participant prior to the date when the Restricted Shares have fully vested pursuant to Section 5. Any attempt to transfer Restricted Shares in violation of this Section 6 will be null and void and will be disregarded. 7. SECTION 83(b) ELECTION AND WITHHOLDING OF TAXES. The Participant shall provide the Plan Administrator with a copy of any timely election made pursuant to Section 83(b) of the Code or similar provision of state law (collectively, an "83(b) Election"), a form of which is attached hereto as EXHIBIT A. If the Participant makes a timely 83(b) Election, the Participant shall immediately pay the Company the amount necessary to satisfy any applicable foreign, federal, state, and local income and employment tax withholding obligations. If the Participant does not make a timely 83(b) Election, the Participant shall, as Restricted Shares vest or at the time withholding is otherwise required by any Applicable Law, pay the Company the amount necessary to satisfy any applicable foreign, federal, state, and local income and employment tax withholding obligations. 8. CORPORATE TRANSACTIONS AND CHANGE IN CONTROL. (a) Upon the occurrence of any Corporate Transaction, all Restricted Shares that are outstanding under this Plan shall immediately vest in full. (b) The Plan Administrator shall have the discretionary authority, exercisable at any time while Restricted Shares remain outstanding under the Plan, to provide for the immediate and automatic vesting of those Restricted Shares in whole or in part upon the occurrence of a Change in Control. 9. USE OF PROCEEDS. Cash proceeds received by the Company from the sale of Shares under the Plan may be used for general corporate purposes. 10. ADMINISTRATION. The Plan shall be administered by the Plan Administrator which shall have full and exclusive discretionary authority to construe, interpret and apply the terms of the Plan and to adjudicate all disputed claims filed under the Plan. Every finding, decision and determination made by the Plan Administrator shall, to the full extent permitted by Applicable Law, be final and binding upon all persons. 11. AMENDMENT OR TERMINATION. The Plan Administrator may at any time and for any reason terminate or amend the Plan. Except as provided in Section 8, no such termination can affect Restricted Shares previously granted and no such amendment may make any change in any 5 Restricted Shares theretofore granted which adversely affects the rights of any Participant without the consent of affected Participants. 12. CONDITIONS UPON ISSUANCE OF SHARES. At the time of vesting pursuant to Section 5(a), Shares shall not be issued with respect to Restricted Shares that are vesting unless the vesting of such Restricted Shares and the issuance and delivery of such Shares pursuant thereto shall comply with all Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. As a condition to the issuance of Shares, the Company may require the Participant to represent and warrant at the time of any such issuance that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned Applicable Laws. 13. TERM OF PLAN. The Plan shall become effective upon its adoption by the Board. It shall terminate on May 1, 2000 unless sooner terminated under Section 11. 14. NO EMPLOYMENT RIGHTS. Neither the action of the Company in establishing the Plan, nor any action taken by the Plan Administrator hereunder, nor any provision of the Plan shall be construed so as to grant any individual the right to remain in the Continuous Service of the Company (or a Related Entity) for any period of specific duration, and the Company (or any Related Entity retaining the services of such individual) may terminate such individual's Continuous Service at any time and for any reason, with or without cause. 15. NO EFFECT ON RETIREMENT AND OTHER BENEFIT PLANS. Except as specifically provided in a retirement or other benefit plan of the Company or a Related Entity, participation in the Plan shall not be deemed compensation for purposes of computing benefits or contributions under any retirement plan of the Company or a Related Entity, and shall not affect any benefits under any other benefit plan of any kind or any benefit plan subsequently instituted under which the availability or amount of benefits is related to level of compensation. The Plan is not a "Retirement Plan" or "Welfare Plan" under the Employee Retirement Income Security Act of 1974, as amended. 16. GOVERNING LAW. The Plan is to be construed in accordance with and governed by the internal laws of the State of California (as permitted by Section 1646.5 of the California Civil Code, or any similar successor provision) without giving effect to any choice of law rule that would cause the application of the laws of any jurisdiction other than the internal laws of the State of California to the rights and duties of the parties, except to the extent the internal laws of the State of California are superseded by the laws of the United States. Should any provision of the Plan be determined by a court of law to be illegal or unenforceable, the other provisions shall nevertheless remain effective and shall remain enforceable. 6 EXHIBIT A ELECTION UNDER SECTION 83(b) OF THE INTERNAL REVENUE CODE OF 1986 The undersigned taxpayer hereby elects, pursuant to the Internal Revenue Code, to include in gross income for 1999 the amount of any compensation taxable in connection with the taxpayer's receipt of the property described below: 1. The name, address, taxpayer identification number and taxable year of the undersigned are: TAXPAYER'S NAME: SPOUSE'S NAME: TAXPAYER'S SOCIAL SECURITY NO.: SPOUSE'S SOCIAL SECURITY NO.: TAXABLE YEAR: Calendar Year 1999 ADDRESS: 2. The property which is the subject of this election is __________ shares of common stock of Digital Microwave Corporation. 3. The property was transferred to the undersigned on March __, 1999. 4. The property is subject to repurchase at the original purchase price if the taxpayer terminates employment prior to the vesting of the transferred shares. 5. The fair market value of the property at the time of transfer (determined without regard to any restriction other than a restriction which by its terms will never lapse) is: $_______ per share x ________ shares = $___________. 6. The undersigned paid $______ per share x _________ shares for the property transferred or a total of $______________. The undersigned has submitted a copy of this statement to the person for whom the services were performed in connection with the undersigned's receipt of the above-described property. The undersigned taxpayer is the person performing the services in connection with the transfer of said property. The undersigned will file this election with the Internal Revenue Service office to which he files his annual income tax return not later than 30 days after the date of transfer of the property. A copy of the election also will be furnished to the person for whom the services were performed. Additionally, the undersigned will include a copy of the election with his income tax A-1 return for the taxable year in which the property is transferred. The undersigned understands that this election will also be effective as an election under _____________ law. Dated: ------------------------- ------------------------- Taxpayer The undersigned spouse of taxpayer joins in this election. Dated: ------------------------- ------------------------- Spouse of Taxpayer A-2 -----END PRIVACY-ENHANCED MESSAGE-----