The company has also delayed making the interest payments on its senior notes. And rumors are also flying that Spansion (Sunnyvale, Calif.) will implement another layoff this week, reportedly in Austin, Texas, sources said.

Earlier this month, the NOR-flash leader named John Kispert, former president and COO of KLA-Tencor Corp., as its new chief executive and member of the board. He replaced Bertrand Cambou, who stepped down.

Spansion is running out of options amid losses and poor demand. On Jan. 15, Spansion announced it was exploring strategic alternatives for a sale or merger. The company also announced plans to restructure its balance sheet.

Sources indicate that Spansion is mulling bankruptcy fillings. Its Japanese unit did file for bankruptcy. And at one time, Toshiba Corp. was looking at buying Spansion. Micron Technology Inc. is also reportedly looking at Spansion.

On Feb. 12, 2009, Kispert joined the company, ''to which he is entitled to compensation of $75,000 per month,'' according to a recent filing at the U.S. Securities and Exchange Commission (SEC).

According to the filing, ''the company will pay Mr. Kispert a nonrefundable advance of four months salary. In addition, Mr. Kispert is entitled to a bonus of $1.75 million upon the first to occur of either of the following transactions:

''A merger or consolidation of the company with any other corporation which constitutes a change in ownership of the securities of the company representing more than fifty percent of the total voting power represented by the company's then outstanding securities, other than a merger or consolidation which would result in holders of pre-transaction debts of the company generally holding at least fifty percent of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or

''(ii) The sale, lease or other disposition by the Company of all or substantially all the company's assets, which occurs on the date that any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the company that have a total gross fair market value equal to or more than eighty-five percent of the total fair market value of all of the assets of the company immediately prior to such acquisition or acquisitions.''