Micrel Semi seeks to swap worthless stock options

*To seek shareholder permission for stock option exchange

*To revalue "underwater" employee options

April 6 (Reuters) - Analog chip maker Micrel Semiconductor
Inc (MCRL.O) said it will seek permission from its shareholders
to revalue worthless employee stock options, joining a slew of
technology companies that have taken similar action to retain
staff.

Under the plan, Micrel would exchange employees'
underwater stock options -- whose exercise prices are above the
current stock price -- for new options at lower prices.

The offer would be open to all employees, excluding
executive officers and members of the board.

The company's shares have lost nearly a third of their
value since touching a high of $10.77 in April 2008. In its
fourth-quarter report, the company had said nearly all of its
customers significantly reduced their orders and took actions
to lower inventories.

Other technology companies that have taken similar actions
include Intel Inc (INTC.O), Google Inc (GOOG.O), eBay Inc
(EBAY.O) and Motorola Inc (MOT.N).

In a regulatory filing on Monday, Micrel said it expects
that the exchange program will commence on or about July 13 and
that employees will have at least 20 days to elect to exchange
all or none of their eligible options for replacement options.

Shares of the company, which has its annual shareholders'
meeting scheduled for May 21, closed at $7.29 Friday on
Nasdaq.
(Reporting by Saumyadeb Chakrabarty in Bangalore; Editing by
Himani Sarkar)