Exhibit 10.2
RESTATED MICROCHIP TECHNOLOGY INCORPORATED
EMPLOYEE STOCK PURCHASE PLAN
AS AMENDED THROUGH AUGUST 18, 2000
I. PURPOSE
The Microchip Technology Incorporated Employee Stock Purchase Plan
(the "Plan") is intended to provide eligible employees of the Company and one or
more of its Corporate Affiliates with the opportunity to acquire a proprietary
interest in the Company through participation in a plan designed to qualify as
an employee stock purchase plan under Section 423 of the Code.
II. DEFINITIONS
For purposes of administration of the Plan, the following terms shall
have the meanings indicated:
BOARD means the Board of Directors of the Company.
CODE means the Internal Revenue Code of 1986, as amended from time to
time.
COMPANY means Microchip Technology Incorporated, a Delaware
corporation, and any corporate successor to all or substantially all of the
assets or voting stock of Microchip Technology Incorporated which shall by
appropriate action adopt the Plan.
COMMON STOCK means shares of the Company's common stock, par value
$0.001 per share.
CORPORATE AFFILIATE means any parent or subsidiary corporation of the
Company (as determined in accordance with Code Section 424) which is
incorporated in the United States, including any parent or subsidiary
corporation which becomes such after the Effective Date.
EARNINGS means the sum of the following items of compensation paid to
a Participant by one or more Participating Companies during such individual's
period of participation in the Plan: (i) regular base salary, plus (ii) any
pre-tax contributions made by the Participant to any Code Section 401(k) salary
deferral plan or any Code Section 125 cafeteria benefit program now or hereafter
established by the Company or any Corporate Affiliate plus (iii) all overtime
payments, bonuses, commissions, profit-sharing distributions and other
incentive-type payments. There shall, however, be excluded from the calculation
of such Earnings any and all contributions (other than Code Section 401(k) or
Code Section 125 contributions) made on the Participant's behalf by the Company
or one or more Corporate Affiliates under any employee benefit or welfare plan
now or hereafter established.
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EFFECTIVE DATE means March 17, 1993, the start date of the first
offering period under the Plan. However, for any Corporate Affiliate which
becomes a Participating Company in the Plan after such date, a subsequent
Effective Date shall be designated with respect to participation by its Eligible
Employees.
ELIGIBLE EMPLOYEE means any person who is engaged, on a
regularly-scheduled basis of more than twenty (20) hours per week for more than
five (5) months per calendar year, in the rendition of personal services to the
Company or any other Participating Company for earnings considered wages under
Section 3121(a) of the Code.
ENTRY DATE means the date an Eligible Employee first joins the
offering period in effect under the Plan. The earliest Entry Date under the Plan
shall be the Effective Date.
FAIR MARKET VALUE means the fair market value of the Common Stock on
any relevant date under the Plan and shall, for any date following the initial
March 17, 1993 Effective Date, be deemed to be equal to the closing selling
price per share of Common Stock on the date in question, as officially quoted on
the Nasdaq National Market. If there is no quoted selling price for the date in
question, then the closing selling price per share of Common Stock on the next
preceding day for which there does exist such a quotation shall be determinative
of Fair Market Value.
PARTICIPANT means any Eligible Employee of a Participating Company who
is actively participating in the Plan.
PARTICIPATING COMPANY means the Company and such Corporate Affiliate
or Affiliates as may be designated from time to time by the Board to extend the
benefits of the Plan to their Eligible Employees.
SEMI-ANNUAL ENTRY DATE means the first business day of each March and
September within an offering period in effect under the Plan. However, the
earliest Semi-Annual Entry Date under the Plan shall be the March 17, 1993
Effective Date.
SEMI-ANNUAL PERIOD OF PARTICIPATION means each semi-annual period for
which the Participant actually participates in an offering period in effect
under the Plan. There shall be a maximum of four (4) semi-annual periods of
participation within each offering period. Except as otherwise designated by the
Plan Administrator, the first such semi-annual period (which may actually be
less than six (6) months for the initial offering period) shall extend from the
start date of the offering period through the last business day in August;
subsequent semi-annual periods shall then be measured from the first business
day of September and March thereafter to the last business day of February and
August, respectively.
SEMI-ANNUAL PURCHASE DATE means the last business day of each February
and August within an offering period on which shares of Common Stock are
automatically purchased for Participants under the Plan.
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SERVICE means the period during which an individual performs services
as an Eligible Employee and shall be measured from his or her hire date, whether
that date is before or after the Effective Date of the Plan.
III. ADMINISTRATION
The Plan shall be administered by a committee (the "Plan
Administrator") comprised of two (2) or more non-employee Board members
appointed from time to time by the Board. The Plan Administrator shall have full
authority to administer the Plan, including authority to interpret and construe
any provision of the Plan and to adopt such rules and regulations for
administering the Plan as it may deem necessary in order to comply with the
requirements of Section 423 of the Code. Decisions of the Plan Administrator
shall be final and binding on all parties who have an interest in the Plan.
IV. OFFERING PERIODS
A. Shares of Common Stock shall be offered for purchase under the Plan
through a series of successive offering periods until such time as (i) the
maximum number of shares of Common Stock available for issuance under the Plan
shall have been purchased or (ii) the Plan shall have been sooner terminated in
accordance with Article IX.
B. The Plan shall be implemented in a series of successive offering
periods, each to be of a duration of twenty-four (24) months or less as
designated by the Plan Administrator prior to the start date. The initial
offering period will begin on the Effective Date and will end on the last
business day in February 1995. The next offering period shall commence on the
first business day in March 1995, and subsequent offering periods shall commence
as designated by the Plan Administrator.
C. Under no circumstances shall any offering period commence under the
Plan, nor shall any shares of Common Stock be issued hereunder, until such time
as (i) the Plan shall have been approved by the Company's stockholders and (ii)
the Company shall have complied with all applicable requirements of the
Securities Act of 1933 (as amended), all applicable listing requirements of any
securities exchange on which shares of the Common Stock are listed and all other
applicable statutory and regulatory requirements.
D. The Participant shall be granted a separate purchase right for each
offering period in which he/she participates. The purchase right shall be
granted on the Entry Date on which such individual first joins the offering
period in effect under the Plan and shall be automatically exercised in
successive semi-annual installments on the last business day of each February
and August within the remainder of the offering period. Accordingly, each
purchase right may be exercised up to two (2) times each calendar year it
remains outstanding.
E. The acquisition of Common Stock through plan participation for any
offering period shall neither limit nor require the acquisition of Common Stock
by the Participant in any subsequent offering period.
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V. ELIGIBILITY AND PARTICIPATION
A. Each Eligible Employee of a Participating Company shall be eligible
to participate in the Plan in accordance with the following provisions:
- An individual who is an Eligible Employee with at least thirty
(30) days of Service prior to the start date of the offering
period may enter that offering period on the Semi-Annual Entry
Date coincident with such start date or on any subsequent
Semi-Annual Entry Date within that offering period on which
he/she remains an Eligible Employee. The Semi-Annual Entry Date
on which such individual first joins the offering period shall
become such individual's Entry Date for the offering period, and
on that date such individual shall be granted his/her purchase
right for the offering period.
- An individual who is not an Eligible Employee with at least
thirty (30) days of Service on the start date of the offering
period may subsequently enter that offering period on the first
Semi-Annual Entry Date on which he/she is an Eligible Employee
with thirty (30) or more days of Service or on any subsequent
Semi-Annual Entry Date within that offering period on which
he/she remains an Eligible Employee. The Semi-Annual Entry Date
on which such individual first joins the offering period shall
become such individual's Entry Date for that offering period, and
on that date such individual shall be granted his/her purchase
right for the offering period.
B. To participate for a particular offering period, the Eligible
Employee must complete the enrollment forms prescribed by the Plan Administrator
(including a purchase agreement and a payroll deduction authorization) and file
such forms with the Plan Administrator (or its designate) on or before his/her
scheduled Entry Date.
C. The payroll deduction authorized by the Participant for purposes of
acquiring shares of Common Stock under the Plan may be any multiple of one
percent (1%) of the Earnings paid to the Participant during each Semi-Annual
Period of Participation within the offering period, up to a maximum of ten
percent (10%). The deduction rate so authorized shall continue in effect for the
remainder of the offering period, except to the extent such rate is changed in
accordance with the following guidelines:
- The Participant may, at any time during a Semi-Annual Period of
Participation, reduce his/her rate of payroll deduction. Such
reduction shall become effective as soon as possible after the
filing of the requisite reduction form with the Plan
Administrator (or its designate), but the Participant may not
effect more than one (1) such reduction during the same
Semi-Annual Period of Participation.
- The Participant may not increase his/her rate of payroll
deduction following his/her Entry Date into the offering period.
However, the Participant may, prior to his/her Entry Date into
any new offering period, increase the rate of his/her payroll
deduction by filing the appropriate form with the Plan
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Administrator (or its designate). The new rate (which may not
exceed the ten percent (10%) maximum) shall become effective as
of the Participant's Entry Date into the first offering period
following the filing of such form.
Payroll deductions will automatically cease upon the termination of
the Participant's purchase right in accordance with the provisions of Section
VII below.
VI. STOCK SUBJECT TO PLAN
A. The Common Stock purchasable under the Plan shall, solely in the
discretion of the Plan Administrator, be made available from either authorized
but unissued shares of Common Stock or from shares of Common Stock reacquired by
the Company, including shares of Common Stock purchased on the open market. The
total number of shares which may be issued over the term of the Plan shall not
exceed 5,759,000 shares (subject to adjustment under Section VI.B below).
However, not more than 2,285,000 shares may be issued under the Plan from and
after March 1, 1995, subject to adjustment under Section VI.B below.
B. In the event any change is made to the outstanding Common Stock by
reason of any stock dividend, stock split, combination of shares or other change
affecting such outstanding Common Stock as a class without the Company's receipt
of consideration, appropriate adjustments shall be made by the Plan
Administrator to (i) the class and maximum number of securities issuable over
the term of the Plan and from and after the March 1, 1995 effective date of this
restatement, (ii) the class and maximum number of securities purchasable per
Participant during any one (1) Semi-Annual Period of Participation and (iii) the
class and number of securities and the price per share in effect under each
purchase right at the time outstanding under the Plan. Such adjustments shall be
designed to preclude the dilution or enlargement of rights and benefits under
the Plan.
VII. PURCHASE RIGHTS
An Eligible Employee who participates in the Plan for a particular
offering period shall have the right to purchase shares of Common Stock, in a
series of successive semi-annual installments during such offering period, upon
the terms and conditions set forth below and shall execute a purchase agreement
embodying such terms and conditions (not inconsistent with the Plan) as the Plan
Administrator may deem advisable.
PURCHASE PRICE. Common Stock shall be issuable at the end of each
Semi-Annual Period of Participation within the offering period at a purchase
price equal to eighty-five percent (85%) of the LOWER of (i) the Fair Market
Value per share on the Participant's Entry Date into that offering period or
(ii) the Fair Market Value per share on the Semi-Annual Purchase Date on which
such Semi-Annual Period of Participation ends. However, for each Participant
whose Entry Date is other than the start date of the offering period, the clause
(i) amount shall in no event be less than the Fair Market Value of the Common
Stock on the start date of that offering period.
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PAYMENT. Payment for the Common Stock purchased under the Plan shall
be effected by means of the Participant's authorized payroll deductions. Such
deductions shall begin with the first full payroll period beginning with or
immediately following the Participant's Entry Date into the offering period and
shall (unless sooner terminated by the Participant) continue through the pay day
ending with or immediately prior to the last day of the offering period. The
amounts so collected shall be credited to the Participant's book account under
the Plan, but no interest shall be paid on the balance from time to time
outstanding in such account. The amounts collected from a Participant may be
commingled with the general assets of the Company and may be used for general
corporate purposes.
NUMBER OF PURCHASABLE SHARES. The number of shares purchasable per
Participant for each Semi-Annual Period of Participation during the offering
period shall be the number of whole shares obtained by dividing the payroll
deductions collected from the Participant during that Semi-Annual Period of
Participation by the purchase price in effect for the Participant for such
period. No Participant may purchase more than Twenty Thousand Two Hundred and
Fifty (20,250) shares of Common Stock per Semi-Annual Period of Participation,
subject to periodic adjustment under Section VI.B.
Under no circumstances shall purchase rights be granted under the Plan
to any Eligible Employee if such individual would, immediately after the grant,
own (within the meaning of Code Section 424(d)) or hold outstanding options or
other rights to purchase, stock possessing five percent (5%) or more of the
total combined voting power or value of all classes of stock of the Company or
any of its Corporate Affiliates.
TERMINATION OF PURCHASE RIGHT. The following provisions shall govern
the termination of outstanding purchase rights:
(i) A Participant may, at any time prior to the last five (5)
business days of the Semi-Annual Period of Participation,
terminate his/her outstanding purchase right under the Plan by
filing the prescribed notification form with the Plan
Administrator (or its designate). No further payroll deductions
shall be collected from the Participant with respect to the
terminated purchase right, and any payroll deductions collected
for the Semi-Annual Period of Participation in which such
termination occurs shall, at the Participant's election, be
immediately refunded or held for the purchase of shares on the
next Semi-Annual Purchase Date. If no such election is made at
the time the purchase right is terminated, then the deductions
collected with respect to the terminated right shall be refunded
as soon as possible.
(ii) The termination of such purchase right shall be irrevocable, and
the Participant may not subsequently rejoin the offering period
for which the terminated purchase right was granted. In order to
resume participation in any subsequent offering period, such
individual must re-enroll in the Plan (by making a timely filing
of a new purchase agreement and payroll deduction authorization)
on or before his/her scheduled Entry Date into the new offering
period.
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(iii) If the Participant ceases to remain an Eligible Employee while
his/her purchase right remains outstanding, then such purchase
right shall immediately terminate, and the payroll deductions
collected from such Participant for the Semi-Annual Period of
Participation in which the purchase right so terminates shall be
promptly refunded to the Participant. However, in the event the
Participant's cessation of Eligible Employee status occurs by
reason of his/her death or permanent disability, then such
individual (or the personal representative of the estate of a
deceased Participant) shall have the following election,
exercisable at any time prior to the last five (5) business days
of the Semi-Annual Period of Participation in which such
cessation of Eligible Employee status occurs:
- to withdraw all of the Participant's payroll deductions
for such Semi-Annual Period of Participation, or
- to have such funds held for the purchase of shares on
the Semi-Annual Purchase Date immediately following
such cessation of Eligible Employee status.
If a timely election is not made, then the payroll deductions shall be
refunded as soon as possible after the close of such Semi-Annual Period of
Participation. In no event, however, may any payroll deductions be made on the
Participant's behalf following his/her cessation of Eligible Employee status.
STOCK PURCHASE. Shares of Common Stock shall automatically be
purchased on behalf of each Participant (other than Participants whose payroll
deductions have previously been refunded in accordance with the Termination of
Purchase Right provisions above) on each Semi-Annual Purchase Date. The purchase
shall be effected by applying each Participant's payroll deductions for the
Semi-Annual Period of Participation ending on such Semi-Annual Purchase Date
(together with any carryover deductions from the preceding Semi-Annual Period of
Participation) to the purchase of whole shares of Common Stock (subject to the
limitation on the maximum number of purchasable shares set forth above) at the
purchase price in effect for the Participant for such Semi-Annual Period of
Participation. Any payroll deductions not applied to such purchase because they
are not sufficient to purchase a whole share shall be held for the purchase of
Common Stock in the next Semi-Annual Period of Participation. However, any
payroll deductions not applied to the purchase of Common Stock by reason of the
limitation on the maximum number of shares purchasable by the Participant during
the Semi-Annual Period of Participation shall be promptly refunded to the
Participant.
PRORATION OF PURCHASE RIGHTS. Should the total number of shares of
Common Stock which are to be purchased pursuant to outstanding purchase rights
on any particular date exceed the number of shares then available for issuance
under the Plan, the Plan Administrator shall make a pro-rata allocation of the
available shares on a uniform and nondiscriminatory basis, and the payroll
deductions of each Participant, to the extent in excess of the aggregate
purchase price payable for the Common Stock pro-rated to such individual, shall
be refunded to such Participant.
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RIGHTS AS STOCKHOLDER. A Participant shall have no stockholder rights
with respect to the shares subject to his/her outstanding purchase right until
the shares are actually purchased on the Participant's behalf in accordance with
the applicable provisions of the Plan. No adjustments shall be made for
dividends, distributions or other rights for which the record date is prior to
the date of such purchase.
A Participant shall be entitled to receive, as soon as practicable
after each Semi-Annual Purchase Date, a stock certificate for the number of
shares purchased on the Participant's behalf. Such certificate may, upon the
Participant's request, be issued in the names of the Participant and his/her
spouse as community property or as joint tenants with right of survivorship.
Alternatively, the Participant may request the issuance of such certificate in
"street name" for immediate deposit in a designated brokerage account.
ASSIGNABILITY. No purchase right granted under the Plan shall be
assignable or transferable by the Participant other than by will or by the laws
of descent and distribution following the Participant's death, and during the
Participant's lifetime the purchase right shall be exercisable only by the
Participant.
CHANGE IN OWNERSHIP. Should any of the following transactions (a
"Change in Ownership") occur during the offering period:
(i) a merger or other reorganization in which the Company will not
be the surviving corporation (other than a reorganization
effected primarily to change the State in which the Company is
incorporated), or
(ii) a sale of all or substantially all of the Company's assets in
liquidation or dissolution of the Company, or
(iii) a reverse merger in which the Company is the surviving
corporation but in which more than fifty percent (50%) of the
Company's outstanding voting stock is transferred to person or
persons different from those who held the stock immediately
prior to such merger, or
then all outstanding purchase rights under the Plan shall
automatically be exercised immediately prior to the effective date of such
Change in Ownership by applying the payroll deductions of each Participant for
the Semi-Annual Period of Participation in which such Change in Ownership occurs
to the purchase of whole shares of Common Stock at eighty-five percent (85%) of
the LOWER of (i) the Fair Market Value per share of Common Stock on the
Participant's Entry Date into the offering period in which such Change in
Ownership occurs or (ii) the Fair Market Value per share of Common Stock
immediately prior to the effective date of such Change in Ownership. However,
the applicable share limitations of Articles VII and VIII shall continue to
apply to any such purchase, and the clause (i) amount above shall not, for any
Participant whose Entry Date for the offering period is other than the start
date of that offering period, be less than the Fair Market Value per share of
Common Stock on such start date.
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The Company shall use its best efforts to provide at least ten
(10)-days advance written notice of the occurrence of any such Change in
Ownership, and Participants shall, following the receipt of such notice, have
the right to terminate their outstanding purchase rights in accordance with the
applicable provisions of this Article VII.
VIII. ACCRUAL LIMITATIONS
A. No Participant shall be entitled to accrue rights to acquire Common
Stock pursuant to any purchase right outstanding under this Plan if and to the
extent such accrual, when aggregated with (I) rights to purchase Common Stock
accrued under any other purchase right outstanding under this Plan and (II)
similar rights accrued under other employee stock purchase plans (within the
meaning of Section 423 of the Code) of the Company or its Corporate Affiliates,
would otherwise permit such Participant to purchase more than $25,000 worth of
stock of the Company or any Corporate Affiliate (determined on the basis of the
value of such stock on the date or dates such rights are granted the
Participant) for each calendar year such rights are at any time outstanding.
B. For purposes of applying such accrual limitations, the right to
acquire Common Stock pursuant to each purchase right outstanding under the Plan
shall accrue as follows:
(i) The right to acquire Common Stock under each such purchase right
shall accrue in a series of successive semi-annual installments
as and when the purchase right first becomes exercisable for
each such installment on the last business day of each
Semi-Annual Period of Participation for which the right remains
outstanding.
(ii) No right to acquire Common Stock under an outstanding purchase
right shall accrue to the extent the Participant has already
accrued in the same calendar year the right to acquire Common
Stock under one or more other purchase rights at the rate of
Twenty-Five Thousand Dollars ($25,000) worth of Common Stock
(determined on the basis of the Fair Market Value on the date or
dates such rights are granted) for each calendar year those
rights are at any time outstanding.
(iii) If by reason of such accrual limitations, any purchase right of
a Participant does not accrue for a particular Semi-Annual
Period of Participation, then the payroll deductions which the
Participant made during that Semi-Annual Period of Participation
with respect to such purchase right shall be promptly refunded.
C. In the event there is any conflict between the provisions of this
Article VIII and one or more provisions of the Plan or any instrument issued
thereunder, the provisions of this Article VIII shall be controlling.
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IX. AMENDMENT AND TERMINATION
A. The Board may alter, amend, suspend or discontinue the Plan
following the close of any Semi-Annual Period of Participation. However, the
Board may not, without the approval of the Company's stockholders:
(i) materially increase the number of shares issuable under the Plan
or the maximum number of shares purchasable per Participant
during any one Semi-Annual Period of Participation, except that
the Plan Administrator shall have the authority, exercisable
without such stockholder approval, to effect adjustments to the
extent necessary to reflect changes in the Company's capital
structure pursuant to Section VI.B;
(ii) alter the purchase price formula so as to reduce the purchase
price payable for the shares issuable under the Plan; or
(iii) materially increase the benefits accruing to Participants under
the Plan or materially modify the requirements for eligibility
to participate in the Plan.
B. The Company shall have the right, exercisable in the sole
discretion of the Plan Administrator, to terminate all outstanding purchase
rights under the Plan immediately following the close of any Semi-Annual Period
of Participation. Should the Company elect to exercise such right, then the Plan
shall terminate in its entirety. No further purchase rights shall thereafter be
granted or exercised, and no further payroll deductions shall thereafter be
collected, under the Plan.
X. DISPOSITION OF SHARES
A. The Plan Administrator may, in its absolute discretion, impose, as
a condition to the issuance of the shares of Common Stock purchased under the
Plan, the requirement that each Participant provide the Company with prompt
notice of any transfer or other disposition of those shares which is effected
within two (2) years after Participant's Entry Date into the offering period in
which the shares were purchased OR within one year after the Semi-Annual
Purchase Date on which those shares were in fact purchased. The Plan
Administrator may further require the certificate evidencing such shares to be
endorsed with a legend indicating the existence of such notice requirement and
impose appropriate stop transfer orders with respect to such certificate in the
absence of such notice.
B. The Company shall not record on its books of record any transfer or
other disposition of the shares of Common Stock issued under the Plan which is
not effected in compliance with the foregoing notice requirement. Moreover, the
Company may impose, as a condition to the recordation of such transfer or
disposition, the requirement that the Participant satisfy all Federal, state and
local income and employment tax withholding obligations applicable to such
transfer or disposition.
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XI. GENERAL PROVISIONS
A. The Plan became effective on the March 17, 1993 Effective Date.
B. The March 1, 1995 restatement incorporated a series of amendments
to the Plan authorized by the Board in January, 1995 to effect the following
changes to the Plan: (i) allow Eligible Employees to join an offering period on
any Semi-Annual Entry Date within that offering period, (ii) prohibit
Participants from increasing their rate of payroll deduction under the Plan
after their Entry Date into a particular offering period, (iii) obligate
Participants to notify the Company of any disqualifying disposition (as defined
in Code Section 423) of the shares they acquire under the Plan and (iv) and
increase in the number of shares of Common Stock available for issuance over the
term of the Plan.
C. The Plan shall terminate upon the EARLIER of (i) the last business
day in February 2013(1) or (ii) the date on which all shares available for
issuance under the Plan shall have been sold pursuant to purchase rights
exercised under the Plan.
D. All costs and expenses incurred in the administration of the Plan
shall be paid by the Company.
E. Neither the action of the Company in establishing the Plan, nor any
action taken under the Plan by the Board or the Plan Administrator, nor any
provision of the Plan itself shall be construed so as to grant any person the
right to remain in the employ of the Company or any of its Corporate Affiliates
for any period of specific duration, and such person's employment may be
terminated at any time, with or without cause.
F. The provisions of the Plan shall be governed by the laws of the
State of Arizona without resort to that State's conflict-of-laws rules.
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(1) On August 18, 2000, the stockholders approved an amendment to the Plan to
extend the term of the Plan from the last business day in February 2003 to
the last business day in February 2013.
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SCHEDULE A
COMPANIES PARTICIPATING IN
EMPLOYEE STOCK PURCHASE PLAN
AS OF AUGUST 18, 2000
Microchip Technology Incorporated
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