-----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, EI/ZWNnOanQChYb7oruMm05LAvPsnmL+iB6K9V9F5iP27XIfHcfrZV0Z2okrSUCO BllPLFsak2qxsbZ1d4H2wg== 0000895755-96-000054.txt : 19960724 0000895755-96-000054.hdr.sgml : 19960724 ACCESSION NUMBER: 0000895755-96-000054 CONFORMED SUBMISSION TYPE: S-8 POS PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19960723 EFFECTIVENESS DATE: 19960723 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: VARI L CO INC CENTRAL INDEX KEY: 0000917173 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC COMPONENTS, NEC [3679] IRS NUMBER: 060678347 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 POS SEC ACT: 1933 Act SEC FILE NUMBER: 033-88666 FILM NUMBER: 96597657 BUSINESS ADDRESS: STREET 1: 11101 E 51ST AVE CITY: DENVER STATE: CO ZIP: 80239 BUSINESS PHONE: 3033711560 MAIL ADDRESS: STREET 1: 11101 EAST 51ST AVENUE CITY: DENVER STATE: CO ZIP: 80239 S-8 POS 1 As filed with the Securities and Exchange Commission on July 23, 1996 Registration No. 33-88666 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------------------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 VARI-L COMPANY, INC. (Exact name of registrant as specified in its charter) Colorado 06-0678347 (State of incorporation) (I.R.S. Employer ID No.) 11101 East 51st Avenue, Denver, Colorado 80239 (Address of Principal Executive Offices) (Zip Code) VARI-L COMPANY, INC. AMENDED AND RESTATED TANDEM STOCK OPTION AND STOCK APPRECIATION RIGHTS PLAN (Full title of the plans) Joseph H. Kiser Vari-L Company, Inc. 11101 East 51st Avenue Denver, CO 80239 (Name and address of agent for service) (303) 371-1560 (Telephone number, including area code, of agent for service) CALCULATION OF REGISTRATION FEE Title of Amount Proposed maximum Proposed maximum Amount of securities to to be offering aggregate registration be registered registered price per share(1) offering price(1) fee(1) Common Stock $0.01 Par Value(1) 1,518,750 $7.625 $11,580,468 $3,993.29 (1) The price of $7.625 per share, which is the last price reported to the National Association of Securities Dealers Automated Quotation System on July 16, 1996, is set forth solely for purposes of calculating the filing fee. REGISTRATION OF ADDITIONAL SHARES The Registrant incorporates by reference the contents of the earlier Registration Statement, No. 33-88666, for the registration 1,518,750 additional shares for the Registrant's Amended and Restated Tandem Stock Option and Stock Appreciation Rights Plan which additional shares were approved by the shareholders of the Registrant on June 26, 1996. Item 8. Exhibits 4.1 Restated Articles of Incorporation, as Amended. 4.2 Bylaws (incorporated by reference from Exhibit 3.2 of the Registrant's Registration Statement on Form SB-2, SEC No. 33- 74704-D). 4.3 Amended and Restated Tandem Stock Option and Stock Appreciation Rights Plan effective as of June 26, 1996. 5.1 Opinion of Gorsuch Kirgis L.L.C. regarding legality of shares being issued. 23.1 Consent of Haugen, Springer & Co. 23.2 Consent of Gorsuch Kirgis L.L.C. (contained in its opinion at Exhibit 5.1). 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 Denver, State of Colorado, on this 26th day of June, 1996. VARI-L COMPANY, INC. By: /s/ David G. Sherman David G. Sherman, President 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 President, /s/ David G. Sherman Chief Executive Officer, 6-26-96 David G. Sherman Treasurer and Director (Principal Financial Officer) (Principal Accounting Officer) Chairman of the Board, /s/ Joseph H. Kiser Chief Scientific Officer, 6-26-96 Joseph H. Kiser Secretary and Director Executive Vice President, /s/ Alwin E. Branson Chief Operating Officer 6-26-96 Alwin E. Branson and Director /s/ William P. O'Connor Jr. Director 6-26-96 William P. O'Connor Jr. /s/ Sarah L. Booher Director 6-26-96 Sarah L. Booher /s/ David A. Lisowski Director 6-26-96 David A. Lisowski EXHIBIT INDEX
EXHIBIT METHOD OF FILING - ------- ----------------------------- 4.1 Restated Articles of Incorporation, as Amended. Filed herewith electronically 4.2 Bylaws (incorporated by reference from Exhibit 3.2 of the Registrant's Registration Statement on Form SB-2, SEC No. 33-74704-D). 4.3 Amended and Restated Tandem Stock Option and Stock Appreciation Rights Plan effective as of June 26, 1996. Filed herewith electronically 5.1 Opinion of Gorsuch, Kirgis L.L.C. regarding legality of shares being issued. Filed herewith electronically 23.1 Consent of Haugen, Springer & Co. Filed herewith electronically 23.2 Consent of Gorsuch, Kirgis L.L.C. (contained in its opinion at Exhibit 5.1).
EX-4.1 2 Exhibit 4.1 ARTICLES OF AMENDMENT TO THE ARTICLES OF INCORPORATION OF VARI-L COMPANY, INC. Pursuant to the provisions of the Colorado Business Corporation Act, the undersigned Corporation adopts the following Articles of Amendment to its Articles of Incorporation: FIRST: The name of the Corporation is Vari-L Company, Inc. SECOND: The following amendment to the Articles of Incorporation was adopted on June 26, 1996 by a vote of the shareholders sufficient for approval as prescribed by the Colorado Business Corporation Act: Article IV of the Articles of Incorporation is hereby amended in its entirety to read as follows: ARTICLE IV The total authorized capital of the Corporation shall consist of 50,000,000 shares of Common Stock, which shares shall have a par value of $.01. Any and all of such shares may be issued for such consideration expressed in dollars, not less than the par value thereof, as shall be fixed from time to time by the Board of Directors. The consideration shall be paid, in whole or in part, in money, in other property, tangible or intangible, or in labor or services actually performed for the Corporation. The promise of future services shall not constitute payment or part payment for such shares. Neither the promissory note of a subscriber or direct purchaser of shares from the Corporation nor the unsecured or nonnegotiable promissory note of any other person shall constitute payment or part payment for such shares. Upon receipt of the consideration in an amount not less than par value, such shares shall be issued and deemed fully paid and nonassessable. THIRD: This Amendment does not effect any exchange, reclassification, or cancellation of issued shares. VARI-L COMPANY, INC. By: /s/ David G. Sherman David G. Sherman, President APPENDIX RESTATED ARTICLES OF INCORPORATION WITH AMENDMENTS OF VARI-L COMPANY, INC. Vari-L Company, Inc., a Colorado corporation (the "Corporation"), does hereby adopt, pursuant to Sections 7-2-107 and 7-2- 112 of the Colorado Revised Statutes the following restatement with amendments of its Articles of Incorporation, which were originally filed June 27, 1985 with the Secretary of State, and amended November 27, 1985, December 9, 1986 and July 16, 1987. Pursuant to Sections 7-2-107 and 7-2- 112 of the Colorado Revised Statutes, the Articles of Incorporation are hereby further amended in their entirety and added to as set forth herein. The shareholders approved the restatement with the amendments of the Articles of Incorporation contained herein on December 30, 1993. These Restated Articles of Incorporation with Amendments correctly set forth the provisions of the Articles of Incorporation, as amended, and they supersede the original Articles of Incorporation and all amendments thereto. Pursuant to the foregoing, the undersigned President and Secretary, respectively, of the Corporation do hereby amend and restate the Articles of Incorporation of this Corporation as follows: ARTICLE I The name of this Corporation is Vari-L Company, Inc. ARTICLE II This Corporation shall have perpetual existence. ARTICLE III The nature of the business of this Corporation and the objects and purposes thereof proposed to be transacted, promoted or carried on are as follows: 1. To design, develop, manufacture, buy, sell, lease or otherwise deal in all types of electronic components and to engage in experimental work of all types. To design, develop, manufacture, buy, sell, lease or otherwise deal in all types of electrical equipment, manufacture of variable inductors and all other types of electrical engineering work. To employ and supply the services of engineers, scientists, technicians and designers, and other experts in consulting with and advising corporations, firms and individuals. To engage in research in connection with all types of mechanical and electrical apparatus for the development of electrical components but not restricted thereto. To purchase, own, hold, occupy, lease, exchange, sell, mortgage, convey, develop, build upon, improve and use in any way not inconsistent with the statutes of the State of Colorado, any and all real estate in the State of Colorado and elsewhere. To acquire and pay for in any manner permitted by statute the goodwill, rights, assets and property and undertake or assume the obligations of any person, firm, association or corporation engaged in the same general character as that for which this Corporation is organized. To acquire, apply for, obtain, register, lease, hold, use, sell, grant licenses in respect of, mortgage or otherwise dispose of letters patent of the United States or any foreign country, patent rights, licenses and privileges, inventions, improvements and processes, copyrights, trademarks and trade names, relating to or useful in connection with any business of this Corporation. To purchase, acquire, hold and dispose of stock, bonds and other securities of any other corporation, and to process and exercise in respect thereto all the rights, powers and privileges of ownership. To enter into, make and perform contracts of every kind and description with any person, firm, corporation, body politic or government or colony or dependency thereof. To borrow or raise monies for any of the purposes of the Corporation and, from time to time, without limit as to the amount, to draw, make, accept, endorse, execute and issue promissory notes, drafts, bills of exchange, warrants, bonds, debentures and other negotiable or non-negotiable instruments and evidences of indebtedness, and to secure the payment of any thereof and of the interest thereon by mortgage upon or pledge, conveyance or assignment in trust of the whole or any part of the property of the Corporation, and to sell, pledge or otherwise dispose of such bonds or other obligations of the Corporation for its corporate purposes. 2. To carry on any other business whether or not related to the foregoing, including the transaction of all lawful business for which corporations may be organized pursuant to the Colorado Corporation Code, to have and exercise all powers, privileges and immunities now or hereafter conferred upon or permitted to corporations by the laws of the State of Colorado, and to do any and all of the things hereinbefore set forth to the same extent as natural persons could do insofar as permitted by the laws of the State of Colorado, these Articles of Incorporation, or the Bylaws of this Corporation. The nature of the business, purposes, objects, and powers specified by the foregoing clauses shall not, except as otherwise expressed in this Article III, be limited or restricted by reference to or inference from the terms of any other clause in these Articles of Incorporation. Each purpose, object or power stated in the foregoing clauses shall be regarded as an independent purpose, object or power. ARTICLE IV The total authorized capital of the Corporation shall consist of 10,000,000 shares of Common Stock, which shares shall have a par value of $.01. Any and all of such shares may be issued for such consideration expressed in dollars, not less than the par value thereof, as shall be fixed from time to time by the Board of Directors. The consideration shall be paid, in whole or in part, in money, in other property, tangible or intangible, or in labor or services actually performed for the Corporation. The promise of future services shall not constitute payment or part payment for such shares. Neither the promissory note of a subscriber or direct purchaser of shares from the Corporation nor the unsecured or nonnegotiable promissory note of any other person shall constitute payment or part payment for such shares. Upon receipt of the consideration in an amount not less than par value, such shares shall be issued and deemed fully paid and nonassessable. ARTICLE V Cumulative voting shall not be allowed in the election of directors. ARTICLE VI Shareholders shall not have a pre-emptive right to acquire unissued or treasury shares or securities convertible into such shares or carrying a right to subscribe to or acquire shares. ARTICLE VII The Board of Directors shall have authority to impose reasonable restrictions on the transfer of the Corporation's shares, provided such restrictions are noted conspicuously on the stock certificate representing the shares. Unless such restrictions are so noted, the restrictions shall be ineffective except against a person with actual knowledge of the restrictions. The shares are also subject to any restrictions imposed by law, including particularly restrictions imposed by federal or state securities laws. ARTICLE VIII The business and affairs of the Corporation shall be under the control and management of a Board of Directors, except as otherwise provided by the Colorado Corporation Code. The number of directors of the Corporation shall be not less than three (3) except that there need be only as many directors as there are shareholders in the event the outstanding shares are held of record by fewer than three (3) shareholders. Subject to such limitation, the number of directors shall be fixed by the Bylaws of the Corporation, and such number may be increased or decreased in the manner provided in the Bylaws, but no decrease shall have the effect of shortening the term of any incumbent director. ARTICLE IX The Board of Directors shall have power to enact, alter, amend and repeal such Bylaws not inconsistent with these Articles of Incorporation and the laws of the State of Colorado as it may deem best for the management of the Corporation. ARTICLE X The following provisions are inserted as notice of the specific intent of the Corporation concerning the management of the business and the conduct of the affairs of the Corporation, and the same are in furtherance of, and not in limitation or exclusion of, the powers conferred by the laws of the State of Colorado. 1. Contracts With Officers and Directors. No contract or other transaction between this Corporation and one or more of its directors or any other corporation, firm, association, or other entity in which one or more of its directors or officers are directors or officers or are financially interested shall be void or voidable solely because of such relationship or interest or solely because such directors are present at the meeting of the Board of Directors or a committee thereof which authorizes, approves, or ratifies such contract or transaction or solely because their votes are counted for such purpose if: (a) The fact of such relationship or interest and is disclosed or known to the Board of Directors or committee which authorizes, approves, or ratifies the contract or transaction by a vote or consent sufficient for the purpose without counting the votes of such interested directors; or (b) The fact of such relationship or interest is disclosed or known to the shareholders entitled to vote and they authorize, approve, or ratify such contract or transaction by vote or written consent; or (c) The contract or transaction is fair and reasonable to the Corporation. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee thereof which authorizes, approves, or ratifies such contract or transaction. 2. Indemnification of Officers and Directors. The Board of Directors of the Corporation shall have every power and duty of indemnification of directors, officers, employees and agents, without limitation, provided by the laws of the State of Colorado. 3. Personal Liability of Directors. The personal liability of any of the Corporation's directors to the Corporation or its shareholders for monetary damages for breach of fiduciary duty as a director is eliminated, except that this provision shall not eliminate the liability of the director to the Corporation or to its shareholders for monetary damages (a) for any breach of the director's duty of loyalty to the Corporation or its shareholders; (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (c) for acts specified in Section 7-5-114 of the Colorado Revised Statutes; or (d) for any transaction from which the director derived an improper personal benefit. This provision shall not eliminate the liability of the director to the Corporation or its shareholders from monetary damages for any act or omission occurring prior to the date of filing of this amended Article to the Articles of Incorporation with the Colorado Secretary of State. IN WITNESS WHEREOF, the Corporation has caused these Restated Articles of Incorporation with Amendments to be signed by its President and Secretary this 30th day of December, 1993. VARI-L COMPANY, INC. ATTEST: /s/ Lynnette S. Kiser /s/ David G. Sherman Lynnette S. Kiser, Secretary David G. Sherman, President EX-4.3 3 EXHIBIT 4.3 TANDEM STOCK OPTION AND STOCK APPRECIATION RIGHTS PLAN As Amended and Restated February 23, 1996 1. PURPOSE. Vari-L Company, Inc. (the "Company") hereby establishes the Tandem Stock Option and Stock Appreciation Rights Plan (the "Plan"). The purpose of the Plan is to advance the interests of the Company and its stockholders by providing a means by which the Company shall be able to attract and retain competent officers, directors, key employees, advisors and consultants by providing them with an opportunity to participate in the increased value of the Company which their effort, initiative, and skill have helped produce. 2. GENERAL PROVISIONS. (a) The Plan will be administered by the Compensation Committee of the Board of Directors of the Company (the "Committee"). The Committee shall be comprised of two or more independent outside directors designated by the Board of Directors. The Committee shall have full power to construe and interpret the Plan and to establish and amend rules and regulations for its administration. Each member of the Committee shall be a "disinterested person" within the meaning of Rule 16b-3 promulgated under the Securities Exchange Act of 1934. Any action of the Committee with respect to the Plan shall be taken by majority vote or by the unanimous written consent of the Committee members. (b) The Committee shall determine, in its sole discretion, which participants under the Plan shall be granted stock options or stock appreciation rights, the time or times at which options and rights are granted, as well as the number of shares and the duration of the options or rights which are granted to participants, provided, however, that no participant may be granted more than 300,000 options during any three year period under the Plan. (c) The Committee shall also determine any other terms and conditions relating to options and rights granted under the Plan as the Committee may prescribe, in its sole discretion. (d) The Committee may, in its discretion, delegate its administrative duties with respect to the Plan to an officer or employees, or to a committee composed of officers or employees, of the Company. (e) The Committee shall make all other determinations and take all other actions which it deems necessary or advisable for the administration of the Plan. (f) All decisions, determinations and interpretations made by the Committee shall be binding and conclusive on all participants in the Plan and on their legal representatives, heirs and beneficiaries. (g) Notwithstanding anything to the contrary herein, the Committee shall have no authority to determine the amount, price or timing of grants hereunder to members of the Committee. All grants of options or rights to members of the Committee shall be made only in accordance with and pursuant to the provisions of Section 5(g) hereof. 3. ELIGIBILITY. Officers, directors and employees of the Company and advisors and consultants to the Company shall be eligible to participate in the Plan and to receive options and rights hereunder, provided, however, that: (1) Incentive Stock Options may only be granted to employees (including officers and directors who are employees) of the Company or its subsidiaries; (2) advisors and consultants shall be eligible for grants only if they provide bona fide services that are not rendered in connection with the offer or sale of securities or in a capital-raising transaction; and (3) members of the Committee are only eligible to receive grants in accordance with the provisions of Section 5(g) hereof. 4. NUMBER OF SHARES SUBJECT TO PLAN. The aggregate number of shares of the Company's $.01 par value Common Stock which may be granted to participants shall be 3,000,000 shares, subject to adjustment only as provided in Sections 5(h) and 7 hereof. These shares may consist of shares of the Company's authorized but unissued Common Stock or shares of the Company's authorized and issued Common Stock reacquired by the Company and held in its treasury or any combination thereof. If an option granted under this Plan is surrendered, or for any other reason ceases to be exercisable in whole or in part, the shares as to which the option ceases to be exercisable shall be available for options to be granted to the same or other participants under the Plan, except to the extent that an option is deemed surrendered by the exercise of a tandem stock appreciation right and that right is paid by the Company in stock, in which event the shares issued in satisfaction of the right shall not be available for new options or rights under the Plan. 5. STOCK OPTION. (a) Type of Options. Options granted on or after January 28, 1994 may be either Nonqualified Stock Options or Incentive Stock Options as determined by the Committee in its sole discretion and as reflected in the Notice of Grant issued by the Committee. All Options granted under the Plan prior to January 28, 1994 were nonqualified stock options. "Incentive Stock Option" means an option intended to qualify as an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986 (the "Code"). "Nonqualified Stock Option" means an option not intended to qualify as an Incentive Stock Option or an Incentive Stock Option which is converted to a Nonqualified Stock Option under Section 5(f) hereof. (b) Option Price. The price at which options may be granted under the Plan shall be determined as follows: (i) For Nonqualified Stock Options and Incentive Stock Options the option price shall be equal to 100% of the Fair Market Value of the stock on the date the option is granted provided, however, that Incentive Stock Options granted to any person who, at the time such option is granted owns (as defined in Section 422 of the Code) shares possessing more than 10% of the total combined voting power of all classes of shares of the Company or its parent or subsidiary corporation, the Option Price shall be 110% of the Fair Market Value. (ii) For purposes of this Plan, "Fair Market Value" means the closing price per share on the date of the grant on the stock exchange, automated quotation system or other recognized securities trading market on which the Company's stock is traded. If the Company's stock is traded on a securities market which does not quote a single closing price, then "Fair Market Value" means the average of the closing prices quoted or, if no closing prices are quoted, the average of the high and low prices quoted. If the Company's stock is not traded on any securities market, "Fair Market Value" means the most recent appraised value of the shares or, if an appraisal has not been done since the date of the Company's most recent audited financial statements, then the book value per share as indicated by the Company's most recent audited financial statements. (c) Exercise of Option. The right to purchase shares covered by any option or options under this Plan shall be exercisable only in accordance with the terms and conditions of the grant to the participant. Such terms and conditions may include a time period or schedule whereby some of the options granted may become exercisable, or "vested", over time and certain conditions, such as continuous service or specified performance criteria or goals, must be satisfied for such vesting. The determination as to whether to impose any such vesting schedule or requirements, and the terms of such schedule or requirements, shall be within the sole discretion of the Committee. These terms and conditions may be different for different participants so long as all options satisfy the requirements of the Plan. Options shall be paid for in cash or in shares of the Company's common stock, which shares shall be valued at the Fair Market Value of the shares on the date of exercise, or any combination thereof. The Committee may, in its discretion and subject to ratification by the entire Board of Directors, loan one or more participants all or a portion of the exercise price for up to three (3) years with interest payable at the prime rate quoted in the Wall Street Journal on the date of exercise. Members of the Committee may receive such loans for the exercise of their options without Committee approval or Board ratification. (d) Duration of Options. Unless otherwise prescribed by the Committee or this Plan, options granted hereunder shall expire ten (10) years from the date of grant, subject to early termination as provided in Section 5(f) hereof. (e) Incentive Stock Options Limitations. In no event shall an Incentive Stock Option be granted to any person who, at the time such option is granted, owns (as defined in Section 422 of the Code) shares possessing more than 10% of the total combined voting power of all classes of shares of the Company or of its parent or subsidiary corporation, unless the option price is at least 110% of the Fair Market Value of the stock subject to the Option, and such Option is by its terms not exercisable after the expiration of five (5) years from the date such Option is granted. Moreover, the aggregate Fair Market Value (determined as of the time that option is granted) of the shares with respect to which Incentive Stock Options are exercisable for the first time by any individual employee during any single calendar year under the Plan shall not exceed $100,000. In addition, in order to receive the full tax benefits of an Incentive Stock Option, the employee must not resell or otherwise dispose of the stock acquired upon exercise of the Incentive Stock Option until two (2) years after the date the option was granted and one (1) year after it was exercised. (f) Early Termination of Options. In the event a participant's employment with or service to the Company shall terminate as the result of total disability or the result of retirement at 65 years of age or later, then any options granted to such participant shall terminate and may no longer be exercised three (3) months after the time such participant is no longer an employee, officer or director of, or advisor or consultant to, the Company. If the participant dies while employed or engaged by the Company, to the extent that the option was exercisable at the time of the participant's death, such option may, within one year after the participant's death, be exercised by the person or persons to whom the participant's rights under the option shall pass by will or by the applicable laws of descent and distribution; provided, however, that an option may not be exercised to any extent after the expiration of the option as originally granted. In the event a participant's employment or engagement by the Company shall terminate as the result of any circumstances other than those referred to above, whether terminated by the participant or the Company, with or without cause, then all options granted to such participant under this Plan shall terminate and no longer be exercisable as of the date of such termination, provided, however, that if an employee with an Incentive Stock Option terminates employment prior to its exercise, but after such termination becomes or remains a non- employee officer, director, advisor or consultant eligible for Nonqualified Stock Options hereunder, then the Incentive Stock Option shall be converted to a Nonqualified Stock Option on the date the Incentive Stock Option would otherwise have terminated. An employee who is absent from work with the Company because of total disability, as defined below, shall not by virtue of such absence alone be deemed to have terminated such participant's employment with the Company. All rights which such participant would have had to exercise options granted hereunder will be suspended during the period of such absence and may be exercised cumulatively by such participant upon his return to the Company so long as such rights are exercised prior to the expiration of the option as originally granted. For purposes of this Plan, "total disability" shall mean disability, as a result of sickness or injury, to the extent that the participant is prevented from engaging in any substantial gainful activity and is eligible for and receives a disability benefit under Title II of the Federal Social Security Act. (g) Automatic Grants to Committee Members. No action may be taken by the Committee to grant any options to members of the Committee, provided, however, that irrespective of any such action, on the date of each meeting of the Board of Directors or a committee thereof, each member of the Committee that attends such meeting in person shall receive a grant of a ten year, fully vested, Nonqualified Stock Option to purchase 500 shares of the Company's common stock at Fair Market Value on that date. (h) Reload by Payment in Shares. To the extent that a participant pays for the exercise of an option with shares of the Company's stock rather than cash, the tendered shares shall be deemed to be added back to the Plan, increasing the total number of shares subject to and reserved for the Plan by that amount. 6. STOCK APPRECIATION RIGHTS. (a) Grant. Stock appreciation rights may be granted by the Committee under this Plan upon such terms and conditions as it may prescribe. A stock appreciation right may be granted only in connection with an option previously granted to or to be granted under this Plan. Each stock appreciation right shall become nonexercisable and be forfeited if the related option is exercised. "Stock appreciation right" as used in this Plan means a right to receive the excess of Fair Market Value, on the date of exercise, of a share of the Company's Common Stock on which an appreciation right is exercised over the option price provided for in the related option and is issued in consideration of services performed for the Company or for its benefit by the participant. Such excess is hereafter called "the differential." (b) Exercise of Stock Appreciation Rights. Stock appreciation rights shall be exercisable and be payable in the following manner: (i) A stock appreciation right shall be exercisable by the participant at the same time or times that the option to which it relates could be exercised. A participant wishing to exercise a stock appreciation right shall give written notice of such exercise to the Company. Upon receipt of such notice, the Company shall determine, in its sole discretion, whether the participant's stock appreciation rights shall be paid in cash or in shares of the Company's Common Stock or any combination of cash and shares and thereupon shall, without deducting any transfer or issue tax, deliver to the person exercising such right an amount of cash or shares of the Company's Common Stock or a combination thereof with a value equal to the differential. The date the Company receives the written notice of exercise hereunder is the exercise date. The shares issued upon the exercise of a stock appreciation right may consist of shares of the Company's authorized but unissued Common Stock or of its authorized and issued Common Stock reacquired by the Company and held in its treasury or any combination thereof. No fractional share of Common Stock shall be issued; rather, the Committee shall determine whether cash shall be given in lieu of such fractional share or whether such fractional share shall be eliminated. (ii) The exercise of a stock appreciation right shall automatically result in the surrender of the related stock option by the participant on a share for share basis. Likewise, the exercise of a stock option shall automatically result in the surrender of the related stock appreciation right. Shares covered by surrendered options shall be available for granting further options under this Plan only to the extent and in the amount that such rights are paid by the Company with shares of stock. (iii) The Committee may impose any other terms and conditions it prescribes upon the exercise of a stock appreciation right, which conditions may include a condition that the stock appreciation right may only be exercised in accordance with rules and regulations adopted by the Committee from time to time. (c) Limitation on Payments. Notwithstanding any other provision of this Plan, the Committee may from time to time determine, including at the time of exercise, the maximum amount of cash or stock which may be given upon exercise of any stock appreciation right in any year, provided, however, that all such amounts shall be paid in full no later than the end of the year immediately following the year in which the participant exercised such stock appreciation rights. Any determination under this paragraph may be changed by the Committee from time to time provided that no such change shall require the participant to return to the Company any amount theretofore received or to extend the period within which the Company is required to make full payment of the amount due as the result of the exercise of the participant's stock appreciation rights. (d) Expiration or termination of stock appreciation rights. (i) Each stock appreciation right and all rights and obligations thereunder shall expire on the date on which the related option expires or terminates. (ii) A stock appreciation right shall terminate and may no longer be exercised upon the expiration or termination of the related option. 7. CAPITAL ADJUSTMENTS. The aggregate number of shares of the Company's Common Stock subject to this Plan, the maximum number of shares as to which options may be granted to any one participant hereunder, and the number of shares and the price per share subject to outstanding options, shall be appropriately adjusted by the Committee for any increase or decrease in the number of shares of Common Stock which the Company has issued resulting from any stock split, reverse stock split, stock dividend, combination of shares or any other change, or any exchange for other securities or any reclassification, merger, reorganization, consolidation, redesignation, recapitalization, or otherwise. Similar adjustments shall be made to the terms of stock appreciation rights. 8. NONTRANSFERABILITY. During a participant's lifetime, an option may be exercisable only by the participant and options granted under the Plan and the rights and privileges conferred thereby shall not be subject to execution, attachment or similar process and may not be transferred, assigned, pledged or hypothecated in any manner (whether by operation of law or otherwise) other than by will or by the applicable laws of descent and distribution. Notwithstanding the foregoing, to the extent permitted by applicable law and Rule 16b-3, the Committee may (i) permit a recipient of a Nonqualified Stock Option to designate in writing during the participant's lifetime a beneficiary to receive and exercise the participant's Nonqualified Stock Options in the event of such participant's death (as provided in Section 5(f)), (ii) grant Nonqualified Stock Options that are transferable to the immediate family or a family trust of the recipient, and (iii) modify existing Nonqualified Stock Options to be transferable to the immediate family or a family trust of the recipient. Any other attempt to transfer, assign, pledge, hypothecate or otherwise dispose of any option under the Plan or of any right or privilege conferred thereby, contrary to the provisions of the Plan shall be null and void. 9. AMENDMENT, SUSPENSION, OR TERMINATION OF PLAN. The Committee may at any time suspend or terminate the Plan and may amend it from time to time in such respects as the Committee may deem advisable in order that options and rights granted hereunder shall conform to any change in the law, or in any other respect which the Committee may deem to be in the best interests of the Company; provided, however, that no such amendment shall, without the participant's consent, alter or impair any of the rights or obligations under any option or stock appreciation rights theretofore granted to him under the plan; and provided further that no such amendment shall, without shareholder approval: increase the total number of shares available for grants of options or rights under the Plan (except as provided by Section 7 hereof); (a) materially modify the benefits to participants or the eligibility requirements for grants under the Plan; or (b) effect any change to the Plan which is required to be approved by shareholder by the Code. In addition, the provisions of Section 5(g) relating to the amount, price and timing of grants to members of the Committee shall not be amended more than once every six (6) months other than to comport with applicable changes to the Code, the Employee Retirement Income Security Act or rules thereunder. 10. EFFECTIVE DATE. The effective date of the Plan shall be December 31, 1987, provided, however, that the effective date of the Plan as it relates to Incentive Stock Options shall be January 28, 1994 and no Incentive Stock Option may be granted hereunder before January 28, 1994. If the January 28, 1994 amendment to and restatement of the Plan is not approved by the affirmative vote of a majority of the Company's shareholders on or before January 28, 1995, then the Plan shall remain in effect as it was last amended on June 14, 1990. The failure of the shareholders to approve such amendment and restatement of the Plan shall not, however, affect the validity, duration or any other terms and conditions of options or rights granted prior to January 28, 1994, and shall affect the terms and conditions of options or rights granted after that date only to the extent required by law. 11. TERMINATION DATE. Unless this Plan shall have been previously terminated by the Committee, this Plan shall terminate on January 28, 2004, except as to options and rights theretofore granted and outstanding under the Plan at that date, and no stock option or stock appreciation rights shall be granted after that date. 12. RESALE OF SHARES PURCHASED. All shares of stock purchased under this Plan may be freely resold, subject to applicable state and federal securities laws restricting their transfer. As a condition to exercise of an option, the Company may impose various conditions, including a requirement that the person exercising such option represent and warrant that, at the time of such exercise, the shares of common stock being purchased are being purchased for investment and not with a view to resale or distribution thereof. The resale of shares purchased upon the exercise of Incentive Stock Options may, however, cause the employee to lose certain tax benefits if the employee fails to comply with the holding period requirements described in Section 5(e) hereof. 13. ACCELERATION OF OPTIONS. If the Company or its shareholders enter into an agreement to dispose of all or substantially all of the assets or stock of the Company by means of a sale, merger or other reorganization, liquidation, or otherwise, any option granted pursuant to the Plan shall become immediately exercisable with respect to the full number of shares subject to that option during the period commencing as of the date of the agreement to dispose of all or substantially all of the assets or stock of the Company and ending when the disposition of assets or stock contemplated by that agreement is consummated or the option is otherwise terminated in accordance with its provisions or the provisions of the Plan, whichever occurs first; provided that no option shall be immediately exercisable under this Section on account of any agreement of merger or other reorganization where the shareholders of the Company immediately before the consummation of the transaction will own 50% or more of the total combined voting power of all classes of stock entitled to vote of the surviving entity (whether the Company or some other entity) immediately after the consummation of the transaction. In the event the transaction contemplated by the agreement referred to in this section is not consummated, but rather is terminated, cancelled or expires, the options granted pursuant to the Plan shall thereafter be treated as if that agreement had never been entered into. 13. WRITTEN NOTICE REQUIRED; TAX WITHHOLDING. Any option or right granted pursuant to the Plan shall be exercised when written notice of that exercise by the participant has been received by the Company at its principal office and, with respect to options, when such notice is received and full payment for the shares with respect to which the option is exercised has been received by the Company. Participant agrees that, to the extent required by law, the Company shall withhold or require the payment by participant of any state, federal or local taxes resulting from the exercise of an option or right, provided however that to the extent permitted by law, the Committee may in its discretion, permit some or all of such withholding obligation to be satisfied by the delivery by the participant of, or the retention by the Company of, shares of its common stock. 14. COMPLIANCE WITH SECURITIES LAWS. Shares shall not be issued with respect to any option or right granted under the Plan unless the exercise of that option and the issuance and delivery of the shares pursuant thereto shall comply with all relevant provisions of state and federal law, including without limitation the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder and the requirements of any stock exchange or automated quotation system upon which the shares may then be listed or traded, and shall be further subject to the approval of counsel for the Company with respect to such compliance. Further, each participant must consent to the imposition of a legend on the certificate representing the shares of common stock issued upon the exercise of the option or right restricting their transferability as may be required by law, the option, or the Plan. 14. WAIVER OF VESTING RESTRICTIONS BY COMMITTEE. Notwithstanding any provision of the Plan, in the event a participant dies, becomes disabled, retires as an employee, officer or director of, or as an advisor or consultant to, the Company, the Committee shall have the discretion to waive any vesting restrictions on the retiree's options, or the early termination of any Nonqualified Stock Options held by the retiree. 15. REPORTS TO PARTICIPANTS. The Company shall furnish to each participant a copy of the annual report sent to the Company's shareholders. Upon written request, the Company shall furnish to each participant a copy of its most recent annual report and each quarterly report to shareholders issued since the end of the Company's most recent fiscal year. 16. NO EMPLOYEE CONTRACT. The grant of an option or right under the Plan shall not confer upon any participant any right with respect to continuation of employment by, or the rendition of advisory or consulting services to, the Company, nor shall it interfere in any way with the Company's right to terminate the participant's employment or services at any time. Adopted by the Board of Directors of the Company on January 29, 1994 and approved by the Company's Shareholders on June 20, 1994. Adopted as amended and restated by the Compensation Committee on February 23, 1996 and approved by the Company's Shareholders on June 26, 1996. DAVID G. SHERMAN, JOSEPH H. KISER, President Chairman of the Board and Secretary EX-5.1 4 EXHIBIT 5.1 GORSUCH KIRGIS L.L.C. Attorneys at Law 1401 Seventeenth Street, Suite 1100 Denver, Colorado 80202 Telephone (303) 299-8900 Fax (303) 298-0215 July 19, 1996 Vari-L Company, Inc. 11101 East 51st Avenue Denver, Colorado 80239 Re: Vari-L Company, Inc. Registration Statement on Form S-8 SEC No. 33-88666 Gentlemen: We are counsel to Vari-L Company, Inc., a Colorado corporation (the "Company"), in connection with the preparation of an amendment to the registration statement on Form S-8 (SEC No. 33-88666) to be filed with the Securities and Exchange Commission (the "Registration Statement"), relating to the proposed offering by the Company of up to 1,518,750 additional shares of Common Stock pursuant to the Company's Tandem Stock Option and Stock Appreciation Rights Plan (the "Plan"). In this connection, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such corporate records, certificates and written or oral statements of officers, legal counsel and accountants of the Company and of public officials, and other documents that we have considered necessary and appropriate, and, based thereon, we advise you that in our opinion: 1. The Company is a corporation duly organized and validly existing under the laws of the State of Colorado. 2. The shares offered by the Company, when issued pursuant to and in accordance with the Plan will be validly issued, fully paid and nonassessable. We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement. Very truly yours, /s/ Gorsuch Kirgis L.L.C. GORSUCH KIRGIS L.L.C. EX-23.1 5 EXHIBIT 23.1 HAUGEN, SPRINGER & CO. Certified Public Accountants 9250 East Costilla Avenue Robert S. Haugen, C.P.A. Suite 150 Charles K. Springer, C.P.A. Englewood, Colorado 80012 (303) 799-6969 FAX (303) 799-6974 CONSENT OF INDEPENDENT AUDITORS ------------------------------- The Board of Directors and Stockholders Vari-L Company, Inc. We consent to the incorporation by reference of our report on the financial statements of Vari-L Company, Inc. (the "Company") as of December 31, 1995 and 1994 and for the years then ended to the Company's Registration Statement on Form S-8 (SEC No. 33-88666). /s/Haugen, Springer & Co. HAUGEN, SPRINGER & CO. July 16, 1996 -----END PRIVACY-ENHANCED MESSAGE-----