<PAGE>
As filed with the Securities and Exchange Commission on May 23, 1997
Registration No. 33..............
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
_________
SEMTECH CORPORATION
(Exact name of registrant as specified in charter)
DELAWARE 95-2119684
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
652 MITCHELL ROAD
NEWBURY PARK, CALIFORNIA 91320
(Address, including zip code, of
principal executive offices)
_________
1994 LONG-TERM STOCK INCENTIVE PLAN
(Full title of the plan)
JOHN D. POE
Chief Executive Officer & President
SEMTECH CORPORATION
652 Mitchell Road
Newbury Park, California 91320
(Name and address of agent for service)
Telephone number, including area code, of agent for service: (805) 498-2111
_________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
Proposed Proposed
Maximum Maximum
Title of Amount to be Offering Price Aggregate Amount of
Securities to be registered Registered Per Share (1) Offering Price (1) Registration Fee
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 800,000(2) $30.50 $24,400,000 $7,394
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the amount of the
registration fee in accordance with Rule 457 under the Securities Act of
1933, as amended. The proposed Maximum Aggregate Offering Price is based
on the last sale price as quoted on NASDAQ National Market System
May 22, 1997 of $30.50 per share.
(2) Excludes all shares previously registered under Registrant's 1994 Long-
Term Stock Incentive Plan on Form S-8 Registration Statement
(Registration No. 33-85156).
- --------------------------------------------------------------------------------
This Registration Statement contains ___ sequentially numbered pages.
The Exhibit Index appears as sequentially numbered page ___.
<PAGE>
PART II/1/
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents are hereby incorporated into this Registration
Statement and made a part hereof by this reference.
(a) The Annual Report on Form 10-K of Semtech Corporation (the "Company" or
"Registrant") for the fiscal year ended January 26, 1997 (file No. 1-6395)
filed with the Securities Exchange Commission (the "Commission") pursuant
to the Securities Exchange Act of 1934, as amended (the "Exchange Act");
(b) The Company's Proxy Statement for its annual meeting of stockholders to be
held on June 5, 1997 (other than the portions thereof identified as not
deemed filed with the Commission);
(c) The description of the Company's Common Stock contained in the Company's
Registration Statement on Form S-2 filed with the Commission on December
24, 1985, under the Securities Act of 1933, as amended (the "Securities
Act");
(d) Registration Statement on Form S-8, filed October 14, 1994 and January 31,
1996 (Registration No. 33-85156 and Registration No. 33-00597),
registering a total of 700,000 shares of the Company's Common Stock,
reserved under the 1994 Long-Term Stock Incentive Plan, as amended, under
the Securities Act; and
In addition, all Documents filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent
to the date of this
_____________________________
1/ Information required by Part I of Form S-8 is contained in a Section 10(a)
- -
prospectus to be distributed to each optionee and is omitted from this
Registration Statement in accordance with Rule 428 under the Securities Act and
the Note to Part I of Form S-8.
-2-
<PAGE>
Registration Statement, and prior to the filing of a post-effective amendment
which indicates that all securities offered 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 the filing of such documents with the Commission.
ITEMS 4-7. DESCRIPTION OF SECURITIES; INTERESTS OF NAMED EXPERTS AND COUNSEL;
INDEMNIFICATION OF DIRECTORS AND OFFICERS; EXEMPTION FROM
REGISTRATION CLAIMED.
Items 4 through 7, inclusive, are omitted in reliance upon General
Instruction E to Form S-8, and the above incorporation by reference of a
previously filed and currently effective Form S-8 (see Item 3, subpart (f)
above) registering securities of the same class under the same plan as those
registered on this Form S-8.
ITEM 8. EXHIBITS
Exhibit
Number
- ------
4.1 1994 Long-Term Stock Incentive Plan, as amended.
5 Opinion of counsel as to legality of securities being registered.
23.1 Consent of independent public accountants.
23.2 Consent of counsel (included in Exhibit 5).
24.1 Power of Attorney (included herein on the signature page).
ITEM 9. UNDERTAKINGS.
Item 9 is omitted in reliance upon General Instruction E to Form S-
8, and the above incorporation by reference of a previously filed and currently
effective Form S-8 (see Item 3, subpart (f) above) registering securities of the
same class under the same plan as those registered on this Form S-8.
-3-
<PAGE>
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 Newbury Park, State of California, on May 23, 1997.
SEMTECH CORPORATION
By: /s/ John D. Poe
------------------------------------
John D. Poe, President &
Chief Executive Officer
-4-
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints John D. Poe, with full power to act as
his true and lawful attorney-in-fact and agent, with full power of substitution
and resubstitution, for him and in his name, place, and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in connection therewith, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
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 dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ John D. Poe President & Chief Executive May 23, 1997
- ----------------------------------
(John D. Poe) Officer
/s/ David E. Franz, Jr. Vice President, Chief Financial May 23, 1997
- ----------------------------------
(David G. Franz Jr.) Officer & Principal Accounting
Officer
/s/ James P. Burra Director May 23, 1997
- ----------------------------------
(James P. Burra)
/s/ Rock N. Hankin Director May 23, 1997
- ----------------------------------
(Rock N. Hankin)
/s/ Allen H. Orbuch Director May 23, 1997
- ----------------------------------
(Allen H. Orbuch)
/s/ James T. Schraith Director May 23, 1997
- ----------------------------------
(James T. Schraith)
/s/ Jack O. Vance Director May 23, 1997
- ----------------------------------
(Jack O. Vance)
</TABLE>
-5-
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibits Numbered Page
- -------- -------------
<S> <C> <C>
4.1 1994 Long-Term Stock Incentive Plan,
as amended.
5 Opinion of counsel as to legality of securities being
registered.
23.1 Consent of independent public accountants.
23.2 Consent of counsel (included in Exhibit 5).
24.1 Power of Attorney (included herein on the
signature page).
</TABLE>
-6-
<PAGE>
EXHIBIT 4.1
1994 LONG-TERM STOCK INCENTIVE PLAN
OF
SEMTECH CORPORATION
AS AMENDED
1. PURPOSE OF THE PLAN. This 1994 Long-Term Stock Incentive Plan, as
amended, of Semtech Corporation (the "Plan") is intended to encourage officers
and key employees of, and consultants to, the Company and its Subsidiaries to
acquire or increase their ownership of common stock of the Company on reasonable
terms, to provide compensation opportunities for superior financial results and
outstanding personal performance, to foster in participants a strong incentive
to put forth maximum effort for the continued success and growth of the Company
and its Subsidiaries, and to assist in attracting and retaining the best
available individuals to the Company and its Subsidiaries.
2. DEFINITIONS. When used herein, the following terms shall have the
meaning set forth below:
2.1 "Affiliate" shall mean, with respect to any specified person or
-----------
entity, a person or entity that directly or indirectly, through one or more
intermediaries, controls, or is controlled by, or is under common control with,
the person or entity specified.
2.2 "Award" shall mean an SAR, an Option, an Option granted in tandem with
-------
an SAR, a Performance Share, a Stock Bonus Award, or any or all of them.
2.3 "Award Agreement" shall mean a written agreement in such form as may
-----------------
from time to time be hereafter approved by the Committee, which Award Agreement
shall set forth the terms and conditions of an Award under the Plan, and be duly
executed by the Company and the Participant.
2.4 "Board" shall mean the Board of Directors of the Company.
-------
2.5 "Change in Control" shall mean a pending or threatened takeover bid,
-------------------
tender offer or exchange offer for twenty percent (20%) or more of the
outstanding Common Stock or any other class of stock or securities of the
Company (other than a tender offer or exchange offer made by the Company or any
Subsidiary), whether or not deemed a tender offer under applicable federal or
state law, or in the event that any person makes any filing under Section 13(d)
or 14(d) of the Exchange Act with respect to the Company, other than a Schedule
13G.
Notwithstanding anything in this Section 2.5 to the contrary, a Change in
Control shall not be deemed to occur solely because twenty percent (20%) or more
of the then outstanding voting securities is acquired by (i) a trustee or other
fiduciary holding securities under one or more employee benefit plans maintained
by the Company or any of its subsidiaries, or (ii) any corporation which,
immediately prior to such acquisition, is owned directly or indirectly by the
stockholders of the Company in the same proportion as their ownership of stock
in the Company immediately prior to such acquisition.
2.6 "Code" shall mean the Internal Revenue Code of 1986, as amended from
------
time to time, and reference to any specific provisions of the Code shall refer
to the corresponding provisions of the Code as it may hereafter be amended or
replaced.
<PAGE>
2.7 "Commission" shall mean the United States Securities and Exchange
------------
Commission and all successors thereto.
2.8 "Committee" shall mean the committee appointed by the Board in
-----------
accordance with Section 4 of the Plan; provided, however, that only those
members of the Committee who participate in decisions relative to Awards under
this Plan shall be deemed to be part of the "Committee" for purposes of this
Plan.
2.9 "Company" shall mean Semtech Corporation, a Delaware corporation.
---------
2.10 "Common Stock" shall mean the common stock, par value $.01 per share,
--------------
of the Company.
2.11 "Disability" shall mean a medically determinable physical or mental
------------
impairment which has made an individual incapable of engaging in any substantial
gainful activity. A condition shall be considered a Disability only if (i) it
can be expected to result in death or has lasted or can be expected to last for
a continuous period of not less than twelve (12) months, and (ii) the Committee,
based upon medical evidence, has expressly determined that Disability exists.
2.12 "Disinterested Person" shall mean a member of the Board who is a
----------------------
"disinterested person" within the meaning of Rule 16b-3(c)(2)(i) promulgated by
the Commission under the Exchange Act, or any successor rule.
2.13 "Eligible Participants" shall mean Employee officers (including
-----------------------
officers who are members of the Board), other key Employees and consultants of
the Company or any of its Subsidiaries.
2.14 "Employees" shall mean individuals who are employed (within the
-----------
meaning of Section 3401 of the Code and the regulations thereunder) by the
Company or a Subsidiary.
2.15 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
--------------
amended from time to time, and reference to any specific provisions of the
Exchange Act shall refer to the corresponding provisions of the Exchange Act as
it may hereafter be amended or replaced.
2.16 "Exercise Price" shall mean the price per Share, determined by the
----------------
Committee, at which an Option may be exercised.
2.17 "Fair Market Value" shall mean the value of one (1) Share of Common
-------------------
Stock, determined as follows:
(i) If the Shares are traded on an exchange or over-the-counter on
the National Market System (the "NMS") of the National Association of Securities
Dealers, Inc. Automated Quotation System ("NASDAQ"), (A) if listed on an
exchange, the closing price as reported for composite transactions on the
business day immediately prior to the date of valuation or, if no sale occurred
on that date, then the mean between the closing bid and asked prices on such
exchange on such date, and (B) if
<PAGE>
traded on the NMS, the last sale price on the business day immediately prior to
the date of valuation or, if no sale occurred on such date, then the mean
between the highest bid and lowest asked prices as of the close of business on
the business day immediately prior to the date of valuation, as reported in the
NASDAQ system;
(ii) If the Shares are not traded on an exchange or the NMS but are
otherwise traded over-the-counter, the mean between the highest bid and lowest
asked prices quoted in the NASDAQ system as of the close of business on the
business day immediately prior to the date of valuation or, if on such day such
security is not quoted in the NASDAQ system, the mean between the representative
bid and asked prices on such date in the domestic over-the-counter market as
reported by the National Quotation Bureau, Inc., or any similar successor
organization; and
(iii) If neither clause (i) nor (ii) above applies, the fair market
value as determined by the Administrator in good faith. Such determination shall
be conclusive and binding on all persons.
2.18 "Incentive Stock Option" shall mean an Option meeting the
------------------------
requirements and containing the limitations and restrictions set forth in
Section 422 of the Code.
2.19 "Majority Change in Control" shall mean a merger or consolidation in
----------------------------
which the shareholders of the Company immediately prior to such merger or
consolidation hold, immediately after such merger or consolidation, less than
50% of the general voting power of the surviving or acquiring entity (or parent
corporation thereof), or the sale of substantially all of the assets of the
Company or a sale of more than 50% of the outstanding Common Stock of the
Company by its shareholders in any single transaction or series of related
transactions.
2.20 "Non-Qualified Stock Option" shall mean an Option other than an
----------------------------
Incentive Stock Option.
2.21 "Option" shall mean the right to purchase, at a price and for a term
--------
fixed by the Committee in accordance with the Plan, and subject to such other
limitations and restrictions as the Plan and the Committee impose, the number of
Shares specified by the Committee. An Option may be either an Incentive Stock
Option or a Non-Qualified Stock Option.
2.22 "Participant" shall mean any Eligible Participant to whom a grant of
-------------
an Award has been made and is outstanding under the Plan.
2.23 "Performance Objectives" shall mean the specific targets and
------------------------
objectives established by the Committee under the following four factors:
earnings per share of the Common Stock, return on average stockholders' equity,
return on capital, and other specific objectives established by the Committee.
Earnings per share, return on average stockholders' equity, return on capital
and total Company stockholder returns shall be determined by and measured in
accordance with generally accepted accounting principles as utilized by the
Company in its reports filed under the Exchange Act.
2.24 "Performance Period" shall mean a period of time established by the
--------------------
Committee for which Performance Objectives have been established, of not less
than one nor more than ten consecutive Company fiscal years.
2.25 "Performance Share" shall mean a right, granted to a Participant
-------------------
under Section 12 of the Plan, representing a fixed number of shares of Common
Stock which vests at a specified time or over a period of time in accordance
with a Performance Objective or Performance Objectives.
2.26 "Plan" shall mean this 1994 Long-Term Stock Incentive Plan, as
------
amended.
<PAGE>
2.27 "Regulation T" shall mean Part 220, Chapter II, Title 12 of the Code
--------------
of Federal Regulations, issued by the Board of Governors of the Federal Reserve
System pursuant to the Exchange Act, as amended from time to time, or any
successor regulation which may hereafter be adopted in lieu thereof.
2.28 "Retirement" shall mean the voluntary cessation of employment by an
------------
Employee upon the attainment of age sixty-five (65) and the completion of not
less than twenty (20) years of service with the Company or a Subsidiary.
2.29 "Rule 16b-3" shall mean Rule 16b-3 of the General Rules and
------------
Regulations of the Exchange Act (or any successor rule or regulation).
2.30 "SAR" shall mean a stock appreciation right, which is a right to
-----
receive cash, Shares, or a combination of cash and Shares, as determined or
approved by the Committee in its sole discretion, in an amount per SAR no
greater than the excess, if any, of (i) the Fair Market Value of a Share on the
date the SAR is exercised, over (ii) the SAR Base Price.
2.31 "SAR Base Price" shall mean the Fair Market Value of a Share on the
----------------
date an SAR was granted, or if the SAR was granted in tandem with an Option
(whether or not the Option was granted on a different date than the SAR), in the
Committee's discretion, the Exercise Price of a Share subject to the Option.
2.32 "Section 16 Participant" shall mean a Participant who is (or, in the
------------------------
opinion of the Administrator, may be) generally subject to the Section 16
Requirements with respect to purchases and sales of Common Stock or other equity
securities of the Company.
2.33 "Section 16 Requirements" shall mean those obligations and
-------------------------
requirements imposed by Sections 16(a) and 16(b) of the Exchange Act and the
rules of the Commission promulgated thereunder.
2.34 "Securities Act" shall mean the Securities Act of 1933, as amended
----------------
from time to time, and reference to any specific provisions of the Securities
Act shall refer to the corresponding provisions of the Securities Act as it may
hereafter be amended or replaced.
2.35 "Share" or "Shares" shall mean a share or shares of the Common Stock,
------- --------
any security of the Company issued in lieu of or in substitution of the Common
Stock or, if by reason of the adjustment provisions contained herein any rights
under an Award under the Plan pertain to any other security, such other
security.
2.36 "Stock Bonus Award" shall mean Shares or the right to receive Shares,
-------------------
but which may, in the Committee's sole discretion, be subject to forfeiture
and/or other restrictions set forth in the related Award Agreement and the Plan.
Stock Bonus Awards may be granted as a bonus for services rendered, an incentive
for services to be rendered, or both. Stock Bonus Awards may be subject to
restrictions which lapse over time with or without regard to Performance
Objectives as the Committee in its sole discretion shall determine.
<PAGE>
2.37 "Subsidiary" shall mean any corporation in an unbroken chain of
------------
corporations beginning with the employer corporation if each of the corporations
other than the last corporation in the unbroken chain owns stock possessing
fifty percent (50%) or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.
2.38 "Successor" shall mean the legal representative of the estate of a
-----------
deceased Participant or the person or persons who shall acquire the right to
exercise an Award by bequest or inheritance or by reason of the death of the
Participant.
2.39 "Ten-Percent Stockholder" shall mean an individual who "owns" as
-------------------------
defined in Section 425 of the Code, stock possessing more than ten percent (10%)
of the total combined voting power of all classes of stock of the Company, its
parent, or if applicable, a Subsidiary.
2.40 "Term" shall mean the period during which a particular Award may be
------
exercised.
2.41 "Window Period" shall mean the period beginning on the third business
---------------
day following the date of release of the financial data specified in paragraph
(e)(l)(ii) of Rule 16b-3 and ending on the twelfth business day following such
date.
3. STOCK SUBJECT TO THE PLAN.
3.1 MAXIMUM NUMBER OF SHARES TO BE AWARDED. The maximum number of
Shares for which Awards may be granted under the Plan shall be one million five
hundred (1,500,000). Notwithstanding anything to the contrary contained in this
Section 3.1., in no event shall more than 1,500,000 Shares be cumulatively
available for Awards of Incentive Stock Options under this Plan. The number of
SARs payable in cash under the Plan shall be counted when computing the total
number of Shares available for Awards under the Plan to the extent they are paid
out in cash and to the extent such SARs are intended to satisfy the exclusion of
Rule 16a-1(c)(3)(i) under the Exchange Act.
3.2 CERTAIN LIMITATIONS. The maximum number of Shares with respect to
which Awards related to Shares may be granted during the life of this Plan to
any Eligible Participant shall be twenty percent (20%) of the number of Shares
available under the Plan. The maximum dollar value with respect to Awards
payable in cash which may be granted during any Performance Period to any
Eligible Participant shall be twenty-five thousand dollars ($25,000).
3.3 SHARES UNDERLYING EXPIRED, CANCELLED OR UNEXERCISED AWARDS. Any
Shares subject to issuance upon exercise of an Option or SAR, but which are not
issued because of a surrender, lapse, expiration or termination of any such
Option or SAR prior to issuance of the Shares, or any Shares subject to an SAR
exercised for cash, shall once again be available for issuance in satisfaction
of Awards. Similarly, any Shares issued or issuable pursuant to a Stock Bonus
Award and Performance Shares which are subsequently forfeited or not issued
pursuant to the terms of the grant shall once again be available for issuance in
satisfaction of Awards; provided, however, that any Shares issued or issuable
pursuant to an Award which are subsequently forfeited or not issued as to which
the forfeiting Participant received any benefits of ownership such as dividends
(but excluding voting rights) from the Shares (as determined under Rule 16b-3)
shall not be available again for issuance.
<PAGE>
4. ADMINISTRATION OF THE PLAN. The Board shall appoint the Committee, which
shall consist of not less than two (2) members of the Board, each of whom is a
Disinterested Person. In addition, unless the Board determines otherwise, the
Committee shall be comprised solely of "outside" directors within the meaning of
Section 162(m)(4)(C)(ii) of the Code. Subject to the provisions of the Plan, the
Committee shall have full authority, in its discretion, to determine the
Eligible Participants to whom Awards shall be granted, the number of Shares or
SARs to be covered by each of the Awards, and the terms (including restrictions)
of any such Award; to amend or cancel Awards (subject to Section 21 of the
Plan); to accelerate the vesting of Awards; to require the cancellation or
surrender of any options, stock appreciation rights or stock bonus awards (to
the extent the restrictions have not yet lapsed) previously granted under this
Plan or any other plans of the Company as a condition to the granting of an
Award; to interpret the Plan; and to prescribe, amend, and rescind rules and
regulations relating to it, and generally to interpret and determine any and all
matters whatsoever relating to the administration of the Plan and the granting
of Awards hereunder. The Board may, from time to time, appoint members to the
Committee in substitution for or in addition to members previously appointed and
may fill vacancies, however caused, in the Committee. The Committee shall make
such rules and regulations for the conduct of its business as it shall deem
advisable. All determinations and decisions by the Committee in the exercise of
its powers shall be final, binding and conclusive. No member of the Committee
shall be liable, in the absence of bad faith, for any act or omission with
respect to his service on the Committee.
5. ELIGIBLE PARTICIPANTS TO WHOM AWARDS MAY BE GRANTED. Awards may be
granted in each year or portion thereof while the Plan is in effect to such of
the Eligible Participants as the Committee, in its discretion, shall determine.
In determining the Eligible Participants to whom Awards shall be granted, the
amount of the Award, the number of Shares to be granted or subject to purchase
under such Awards and the number of SARs to be granted, the Committee shall take
into account the duties of the respective Eligible Participants, their present
and potential contributions to the success of the Company and its Subsidiaries,
and such other factors as the Committee shall deem relevant in connection with
accomplishing the purposes of the Plan. No Award shall be granted to any member
of the Committee so long as his or her membership on the Committee continues or
to any member of the Board who is not also an Eligible Participant.
6. STOCK OPTIONS.
6.1 TYPES OF OPTIONS. Options granted under this Plan may be (i)
Incentive Stock Options, (ii) Non-Qualified Stock Options or (iii) a combination
of both. The Award Agreement shall state whether an Option is an Incentive Stock
Option or a Non-Qualified Stock Option. Any Option which is designated as a Non-
Qualified Stock Option shall not be treated by the Company or the Participant to
whom the Option is granted as an Incentive Stock Option for federal income tax
purposes.
6.2 EXERCISE PRICE. Each Award Agreement governing an Option shall
state the Exercise Price. The Exercise Price of any Incentive Option granted
under the Plan shall not be less than the Fair Market Value of the Common Stock
on the date of grant, and in the case of an Incentive Stock Option granted to an
Eligible Participant who, at the time such Incentive Stock Option is granted, is
a Ten-Percent Stockholder, then the Exercise Price of such Incentive Stock
Option shall not be less than one hundred ten percent (110%) of the Fair Market
Value of the Shares covered by the Incentive Stock Option on the date of grant.
The Exercise Price of any Non-Qualified Stock Option shall not be less than
eighty-five percent (85%) of the Fair Market Value of the Common Stock on the
date of grant.
<PAGE>
6.3 TERM OF OPTIONS. Each Award Agreement issued hereunder shall
specify the Term of the Option, which Term shall be determined by the Committee
in accordance with its discretionary authority hereunder. No Option shall be
exercisable for a Term of more than ten (10) years from the date of grant and
shall be subject to earlier termination as hereinafter provided. Notwithstanding
anything herein to the contrary, in the event an Incentive Stock Option is
granted to a Participant who is a Ten-Percent Stockholder at the time of grant,
then such Incentive Stock Option shall not be exercisable more than five (5)
years from the date of grant and shall be subject to earlier termination as
hereinafter provided.
7. LIMIT ON FAIR MARKET VALUE OF INCENTIVE STOCK OPTIONS. The aggregate
Fair Market Value (determined as of the date the Option is granted) of the
Shares with respect to which Incentive Stock Options are exercisable for the
first time by any Participant during the calendar year under the Plan and all
other Plans maintained by the Company, its parent or a Subsidiary shall not
exceed one hundred thousand dollars ($100,000). For purposes of the preceding
sentence, options shall be taken into account in the order in which they were
granted. Any Option granted under the Plan which is intended to be an Incentive
Stock Option, but which exceeds the limitation set forth in this Section 7,
shall be a Non-Qualified Stock Option to the extent that a portion of the Option
exceeds this limitation.
8. STOCK APPRECIATION RIGHTS.
8.1 GRANT OF SAR. The Committee, in its discretion, may grant an
Eligible Participant an SAR in tandem with an Option or may grant an Eligible
Participant an SAR on a stand alone basis. The Committee, in its discretion, may
grant an SAR in tandem with an Option either at the time the Option is granted
or at any time after the Option is granted, but no later than six (6) months and
one (1) day prior to the end of the Term of the Option, so long as the grant of
the SAR is made during the period in which grants of SARs may be made under the
Plan. The Committee, in its discretion, may grant an SAR in tandem with an
Option, which is exercisable either in lieu of, or in addition to, exercise of
the related Option.
8.2 LIMITATIONS ON EXERCISE. Each SAR granted in tandem with an Option
shall be exercisable to the extent, and only to the extent, the related Option
is exercisable and shall be for such Term as the Committee may determine. Such
Term, which shall not exceed ten (10) years, may expire prior to the Term of the
related Option. Each SAR granted on a stand-alone basis shall be exercisable to
the extent, and for such Term, as the Committee may determine. If, and to the
extent, a Section 16 Participant is to receive cash in exchange for an SAR, the
SAR and any related Option are exercisable only during a Window Period. The SARs
shall be subject to such other terms and conditions as the Committee, in its
discretion, shall determine and which are not otherwise inconsistent with the
Plan. The terms and conditions may include Committee approval of the exercise of
the SAR, limitations on the time within which and the extent to which such SAR
shall be exercisable, and limitations, if any, on the amount of appreciation in
value which may be recognized with regard to such SAR. The Company's obligation
to any Participant exercising an SAR may be paid in cash or Shares, or partly in
cash or Shares, at the sole discretion of the Committee. The Committee shall
have at all times final control and authority over the form of payment of any
SAR. If, and to the extent that, Shares are issued in satisfaction of amounts
payable upon exercise of an SAR, the Shares shall be valued at their Fair Market
Value on the date of exercise.
<PAGE>
8.3 SARS IN TANDEM WITH INCENTIVE STOCK OPTIONS. With respect to SARs
granted in tandem with Incentive Stock Options, the following shall apply:
(a) No SAR shall be exercisable unless the Fair Market Value of
the Shares on the date of exercise exceeds the Exercise Price of the
related Incentive Stock Option.
(b) In no event shall any amounts paid pursuant to the SAR exceed
the difference between the Fair Market Value of the Shares on the date
of exercise and the Exercise Price of the related Incentive Stock
Option.
(c) The SAR must expire no later than the last date the related
Incentive Stock Option can be exercised.
8.4 SURRENDER OF OPTION OR SAR GRANTED IN TANDEM. If the Award
Agreement related to the grant of an SAR in tandem with an Option provides that
the SAR can only be exercised in lieu of the related Option, then, upon exercise
of such SAR, the related Option or portion thereof with respect to which such
SAR is exercised shall be deemed surrendered and shall not thereafter be
exercisable and, similarly, upon exercise of the Option, the related SAR or
portion thereof with respect to which such Option is exercised shall be deemed
surrendered and shall not thereafter be exercisable. If the Award Agreement
relating to the grant of an SAR in tandem with an Option provides that the SAR
can be exercised in addition to the related Option, then, upon exercise of such
SAR, the related Option or portion thereof with respect to which such SAR is
exercised shall not be deemed surrendered and shall continue to be exercisable
and, similarly, upon exercise of the Option, the related SAR or portion thereof
with respect to which such Option is exercised shall not be deemed surrendered
and shall continue to be exercisable.
<PAGE>
9. EXERCISE OF RIGHTS UNDER OPTION OR SAR AWARDS. A Participant entitled to
exercise an Option or SAR may do so by delivering to the Company (a) a written
notice of exercise in substantially the form prescribed from time to time by the
Committee specifying the number of Shares with respect to which the Option or
SAR is being exercised and any other information the Committee may prescribe,
and, (b) with respect to an Option in full payment of the Exercise Price for
each Share of Common Stock purchased under the Option. Such notice shall specify
the number of Shares of Common Stock with respect to which the Option or SAR is
exercised and shall be signed by the Participant exercising the Option or SAR.
The Option or SAR must be exercised for at least 500 Shares (or, in the case of
an SAR, for cash equal to the Fair Market Value of 500 Shares) at any one time,
unless the total number available for exercise under the Option or SAR is less
than 500. The purchase price of any Shares to be purchased upon exercise of an
Option may be made (i) in cash, (ii) with the Committee's approval (and subject
to the requirements of Rule 16b-3), in Shares valued at Fair Market Value at the
time of exercise, (iii) with the Committee's approval, a combination thereof or
(iv) as otherwise approved by the Committee in its sole and absolute discretion.
No Shares shall be issued upon exercise of an Option or SAR until full payment
has been made therefor. All notices or requests provided for herein shall be
delivered to the Company as determined by the Committee.
10. RIGHTS OF OPTION AND SAR HOLDERS. The holder of an Option or SAR shall
not have any rights of a stockholder of the Company with respect to the Shares
subject to purchase or issuance under such Award, except to the extent that one
or more certificates for such Shares shall be delivered to the holder upon due
exercise of the Option or SAR.
11. STOCK BONUS AWARDS. Stock Bonus Awards granted under the Plan shall be
subject to such terms and conditions as the Committee may, in its discretion,
determine. Stock Bonus Awards issued under the Plan shall be evidenced by an
Award Agreement in such form as the Committee may from time to time determine.
Stock Bonus Awards may be subject to restrictions which lapse over time with or
without regard to Performance Objectives for a specific Performance Period.
<PAGE>
11.1 RECEIPT OF SHARES. Each Award Agreement shall set forth the number
of Shares issuable under the Stock Bonus Award evidenced thereby. Subject to the
restrictions of Sections 11.2, 11.3 and 11.4 of the Plan and as set forth in the
related Award Agreement, the number of Shares granted under a Stock Bonus Award
shall be issued to the recipient Participant thereof on the date of grant of
such Stock Bonus Award or as soon as may be practicable thereafter and deposited
into escrow, if applicable. If the Committee determines that a Stock Bonus Award
shall be subject to the attainment of Performance Objectives, then such specific
Performance Objectives shall be established prior to the grant of the Stock
Bonus Award. In establishing the Performance Objective or Performance
Objectives, the Committee shall also establish a schedule or schedules setting
forth the portion of the Performance Share which will be earned or forfeited
based on the degree of achievement of the Performance Objectives actually
achieved or exceeded as determined by the Committee. The Committee may at any
time adjust the Performance Objectives and any schedules and portions of
payments related thereto, adjust the way in which Performance Objectives are
measured, or shorten any Performance Period if it determines that conditions or
the occurrence of events warrants such actions; provided, that this provision
shall not apply to any Stock Bonus Award that is intended to qualify as
performance-based compensation under Code Section 162(m)(4)(C) if and to the
extent that it would prevent the Award from so qualifying. The Committee shall
have the right to reduce or eliminate the Stock Bonus Award payable upon the
attainment of a Performance Objective, but shall not have the discretion to
increase an Award upon the attainment of a Performance Objective.
11.2 RIGHTS OF RECIPIENT PARTICIPANTS. Shares received pursuant to
Stock Bonus Awards shall be duly issued or transferred to the Participant, and a
certificate or certificates for such Shares shall be issued in the Participant's
name. Subject to the restrictions in Section 11.3 of the Plan and as set forth
in the related Award Agreement, the Participant shall thereupon be a stockholder
with respect to all the Shares represented by such certificate or certificates
and shall have all the rights of a stockholder with respect to such Shares,
including the right to vote such Shares and to receive dividends and other
distributions paid with respect to such Shares. As a condition to issuing
Shares, the Committee may require a Participant to execute an escrow agreement
and any other documents which the Committee may determine. In aid of such
restrictions, certificates for Shares awarded hereunder, together with a
suitably executed stock power signed by each recipient Participant, shall be
held by the Company in its control for the account of such Participant (i) until
the restrictions determined by the Committee, in its discretion, and as set
forth in the related Award Agreement, lapse pursuant to the Plan or the Award
Agreement, at which time a certificate for the appropriate number of Shares
(free of all restrictions imposed by the Plan or the Award Agreement except
those established by the Committee at the time of grant of the Award) shall be
delivered to the Participant, or (ii) until such Shares are forfeited to the
Company and cancelled as provided by the Plan or the Award Agreement.
11.3 NON-TRANSFERABILITY OF STOCK BONUS AWARDS. Until such time as the
restrictions determined by the Committee or as otherwise set forth in the
related Award Agreement have lapsed, the Shares awarded to a Participant and
held by the Company pursuant to Section 11.2 of the Plan, and the right to vote
such Shares or receive dividends on such Shares, may not be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of; provided, however,
that, if so provided in the Award Agreement, such Shares may be transferred upon
the death of the Participant to such of his legal representatives, heirs and
legatees as may be entitled thereto by will or the laws of intestacy.
<PAGE>
11.4 RESTRICTIONS. Shares received pursuant to Stock Bonus Awards shall
be subject to the terms and conditions as the Committee may determine,
including, without limitation, restrictions on the sale, assignment, transfer or
other disposition of such Shares and the requirement that the Participant
forfeit such Shares back to the Company upon termination of employment for any
reason or for specified reasons.
12. PERFORMANCE SHARES.
12.1 GRANTS OF PERFORMANCE SHARES. Performance Shares may be granted
under the Plan in such form and to such Eligible Participants as the Committee
may from time to time approve. Performance Shares may be granted alone, in
addition to or in tandem with other Awards under the Plan. Subject to the terms
of the Plan, the Committee shall determine the amount or number of Performance
Shares to be granted to a Participant and the Committee may impose different
terms and conditions on any particular grant of Performance Shares to any
Participant. Each grant of Performance Shares shall be evidenced by a written
instrument stating the number of Performance Shares granted, the Performance
Period, the Performance Objective or Performance Objectives, the proportion of
payments for performance between the minimum and full performance levels, if
any, restrictions applicable to Shares receivable in settlement, if any, and any
other terms, conditions, restrictions and rights with respect to such grant as
determined by the Committee. The Committee may determine that the Participant
must forfeit such Performance Shares to the Company upon termination of
employment for any reason or for specified reasons. The Committee may provide,
in its sole discretion, that during a Performance Period, a Participant shall be
paid cash amounts, with respect to each Performance Share held by such
individual in the same manner, at the same time, and in the same amount paid, as
a dividend on any Share.
12.2 PERFORMANCE PERIODS. The Committee shall establish Performance
Periods applicable to Performance Shares. There shall be no limitation on the
number of Performance Periods established by the Committee and more than one
Performance Period may encompass the same fiscal year.
12.3 PERFORMANCE OBJECTIVES. The Committee shall establish one or more
specific Performance Objectives for a Performance Period and such Performance
Objectives shall be established prior to the grant of any Performance Shares
with respect to such period. In establishing the Performance Objective or
Performance Objectives, the Committee shall also establish a schedule or
schedules setting forth the portion of the Performance Shares which will be
earned or forfeited based on the degree of achievement of the Performance
Objectives actually achieved or exceeded as determined by the Committee. The
Committee may at any time adjust the Performance Objectives and any schedules
and portions of payments related thereto, adjust the way Performance Objectives
are measured, or shorten any Performance Period if it determines that conditions
or the occurrence of events warrant such actions; provided, that this provision
shall not apply to any Performance Share that is intended to qualify as
performance-based compensation under Code Section 162(m)(4)(C) if and to the
extent that it would prevent the Award from so qualifying. The Committee shall
have the right to reduce or eliminate the compensation or Award payable upon the
attainment of a Performance Objective but shall not have the discretion to
increase an Award upon the attainment of a Performance Objective.
12.4 NONTRANSFERABILITY OF PERFORMANCE SHARES. Until such time as the
Performance Objectives as determined by the Committee have been met and until
any restrictions upon the Performance Shares have lapsed, Performance Shares and
any rights related thereto may not be sold, exchanged, transferred, pledged,
hypothecated or otherwise disposed of by any Participant.
<PAGE>
12.5 PAYMENT OF AWARDS. As soon as practicable after the end of the
applicable measurement period as determined by the Committee, the Committee
shall determine the extent to which the Performance Objectives have been met and
the extent to which Performance Shares are issuable. Payment in settlement of
Performance Shares shall be payable entirely in cash, entirely in Shares, or in
such combination of Shares and cash as the Committee may determine, in its sole
discretion, at any time prior to such payment. If payment is to be made in the
form of cash, the amount payable for each unit earned shall be equal to the
dollar value of each unit (as determined by the Committee) times the number of
earned units.
13. CESSATION OF EMPLOYMENT.
13.1 CESSATION OF EMPLOYMENT EXCEPT BY DEATH, DISABILITY OR RETIREMENT.
If a Participant ceases to be an Employee for any reason other than his or her
death, Disability or Retirement, such Participant (i) shall have the right,
subject to the restrictions referred to in Section 15 below, to exercise his
Option or SAR at any time within ninety (90) days after cessation of employment,
but, except as otherwise provided in the applicable Award Agreement, only to the
extent that, at the date of cessation of employment, the Participant's right to
exercise such Option or SAR had accrued pursuant to the terms of the applicable
Option Agreement and had not previously been exercised and (ii) shall be
entitled to such portion of his Performance Shares and Stock Bonus Awards which
as of the date of such cessation of employment shall have accrued pursuant to
the terms of the applicable Award Agreement. An Award Agreement may, in the sole
discretion of the Committee, but need not, provide that the Option or SAR shall
cease to be exercisable on the date of such cessation if such cessation arises
by reason of such Employee's misconduct (as defined in any such Award
Agreement). An Employee shall be considered to have been terminated for
misconduct if he or she resigns or is discharged or otherwise terminated on
account of conviction of a felony, misappropriation of the assets of the Company
or any Subsidiaries or any affiliate, continued or repeated insobriety or
illegal drug use, continued or repeated absence from service during the usual
working hours of the employee's position for reasons other than Disability or
sickness, or refusal to carry out a reasonable direction of the Board or of the
chief executive officer of the Company or of any other person designated by such
chief executive officer.
For purposes of this Section 13.1, the employment relationship shall be
treated as continuing intact while the Participant is on military leave, sick
leave or other bona fide leave of absence (to be determined in the sole
discretion of the Committee). The foregoing notwithstanding, in the case of an
Incentive Stock Option, employment shall not be deemed to continue beyond the
ninetieth (90th) day after the Participant ceased active employment, unless the
Participant's reemployment rights are guaranteed by statute or by contract.
<PAGE>
13.2 DEATH OF PARTICIPANT. If a Participant dies while an Employee, or
after ceasing to be an Employee but during the period in which he or she could
have exercised an Option or SAR under this Section 13.2, and has not fully
exercised the Option, then the Option or SAR may be exercised in full, subject
to the restrictions referred to in Section 15 below, at any time within twelve
(12) months after the Participant's death by his Successor, but, except as
otherwise provided in the applicable Award Agreement, only to the extent that,
at the date or death, the Participant's right to exercise such Option or SAR had
accrued and had not been forfeited pursuant to the terms of the applicable Award
Agreement and had not previously been exercised. If an Employee dies while a
Participant and has received Performance Shares or a Stock Bonus Award, such
Participant's Successor shall be entitled to such portion of such Award which as
of the date of death has accrued pursuant to the terms of the Applicable Award
Agreement.
13.3 DISABILITY OF PARTICIPANT. If a Participant ceases to be an
Employee by reason of Disability, such Participant, subject to the restrictions
referred to in Section 15 below, (i) shall have the right, to exercise the
Option or SAR at any time within twelve (12) months after such cessation of
employment, but, except as provided in the applicable Award Agreement, only to
the extent that, at the date of such cessation of employment, the Participant's
right to exercise such Option or SAR had accrued pursuant to the terms of the
applicable Award Agreement and had not previously been exercised, and (ii) shall
be entitled to such portion of his Performance Shares or Stock Bonus Award which
as of the date of cessation of employment shall have accrued pursuant to the
terms of the applicable Award Agreement.
13.4 RETIREMENT OF PARTICIPANT. If a Participant ceases to be an
Employee by reason of Retirement (and not on account of misconduct as determined
in Section 13.1), such Participant, subject to the restrictions referred to in
Section 15 below, (i) shall have the right to exercise the Option or SAR at any
time within ninety (90) days after cessation of employment, but only to the
extent that, at the date of cessation of employment, the Participant's right to
exercise such Option or SAR had accrued pursuant to the terms of the applicable
Award Agreement and had not previously been exercised, and (ii) shall be
entitled to such portion of his Performance Shares or Stock Bonus Award which as
of the date of cessation of employment shall have accrued pursuant to the terms
of the applicable Award Agreement.
14. AWARD TERMS AND CONDITIONS. Each Award Agreement setting forth an Award
shall contain such other terms and conditions not inconsistent herewith as shall
be approved by the Board or by the Committee. The Committee shall from time to
time adopt policies and procedures applicable to Awards that will govern the
lapse or non-lapse of restrictions.
15. NONTRANSFERABILITY OF AWARDS. During the lifetime of a Participant, no
Award of a Participant under the Plan and no rights and interests therein,
including the right to any amounts or Shares payable, may be assigned, pledged,
hypothecated or otherwise transferred by a Participant. In the event of a
Participant's death, the Award shall not be transferable by the Participant
other than by will or the laws of descent and distribution. During the lifetime
of a Participant, Options and SARs are exercisable only by, and payments in
settlement of Awards will be payable only to the Participant or his or her legal
representative. Any other attempted alienation, assignment, pledge,
hypothecation, attachment, execution or similar process, whether voluntary or
involuntary, with respect to all or any part of any Award or right thereunder,
shall be null and void and, at the Company's option, shall cause all of the
Participant's rights under the Award to terminate.
<PAGE>
16. VESTING OF AWARDS. The Committee may, in its sole discretion, grant
Awards which vest over time and/or are based upon satisfaction of Performance
Objectives. The Committee may, in its discretion, modify or change any
Performance Objectives concerning any Award or accelerate the vesting of any
Award; provided that the Committee shall not modify or change any Performance
Objective or accelerate the vesting of any Award that is intended to qualify as
performance-based compensation under Code Section 162(m)(4)(C) if and to the
extent that such modification, change or acceleration would prevent the Award
from so qualifying.
17. EFFECT OF CERTAIN EVENTS.
17.1 STOCK SPLITS AND DIVIDENDS. Subject to any required action by
stockholders, the number of Shares covered by the Plan as provided in Section 3
hereof, the number of Shares covered by each outstanding Award and the purchase
price thereof, if any, shall be proportionately adjusted for any increase or
decrease in the number of issued Shares resulting from a subdivision or
consolidation of Shares or the payment of a stock dividend (but only if paid in
Common Stock) or any other increase or decrease in the number of issued Shares
effected without receipt of consideration by Company.
17.2 MERGER, SALE OF ASSETS, LIQUIDATION. Subject to any required
action by stockholders, if the Company shall merge with another corporation and
the Company is the surviving corporation in such merger and under the terms of
such merger the shares of Common Stock outstanding immediately prior to the
merger remain outstanding and unchanged, each outstanding Award shall continue
to apply to the Shares subject thereto and shall also pertain and apply to any
additional securities and other property, if any, to which a holder of the
number of Shares subject to the Award would have been entitled as a result of
the merger. If the Company sells or disposes of all or substantially all of its
assets or merges (other than a merger of the type described in the immediately
preceding sentence) or consolidates with or into another corporation or entity,
this Plan and each Award shall terminate, but (a) with respect to an Option or
SAR, only after each Participant (or successor in interest) has been given the
right to exercise any unexpired Option or SAR in full or in part, to the extent
that, on the date of such sale, disposition or merger, the Participant's right
to exercise such Option or SAR had accrued pursuant to the terms of the
applicable Award Agreement and had not previously been exercised, and (b) with
respect to Performance Shares and Stock Bonus Awards, each Participant shall be
entitled to such portion of the Performance Shares or Stock Bonus Award which
has vested as of the date of such sale, disposition or merger. The right to
exercise an Option or SAR, as described in clause (a) above, shall be
exercisable for the period of twenty (20) days ending five (5) days before the
effective date of the sale, merger, or consolidation (or such longer period as
the Committee may specify). Alternatively, in its sole and absolute discretion,
the surviving or acquiring corporation (or the parent company of the surviving
or acquiring corporation) may tender to any Participant (or successor in
interest) a substitute option, stock appreciation right, performance share or
stock bonus award of the surviving or acquiring corporation (or the parent
corporation of the surviving or acquiring corporation). The substitute option,
stock appreciation right, performance share or stock bonus award shall contain
all terms and provisions required substantially to preserve the rights and
benefits of all Awards then held by the Participant (or successor in interest)
receiving the substitute option, stock appreciation right, performance share or
stock bonus award. Any other dissolution or liquidation of the Company shall
cause each Award to terminate.
<PAGE>
At the discretion of the Committee, an Option or SAR exercised in
contemplation of the consummation of the sale of all or substantially all of the
assets of the Company or a merger (other than a merger of the type described in
the first sentence of the immediately preceding paragraph) or consolidation of
the Company with another corporation, may be conditioned upon such sale, merger
or consolidation becoming effective.
17.3 ADJUSTMENT DETERMINATION. To the extent that the foregoing
adjustments relate to securities of the Company, such adjustments shall be made
by the Committee, whose determination shall be conclusive and binding on all
persons.
17.4 LIMITATION ON RIGHTS. Except as expressly provided in this Section
17, the Participants shall have no rights by reason of any subdivision or
consolidation of shares of stock of any class, the payment of any stock dividend
or any other increase or decrease in the number of shares of stock of any class
or by reason of any dissolution, liquidation, merger or consolidation or spin-
off of assets or stock of another corporation, and any issue by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or purchase price of Shares subject to an Award. The
grant of an Award pursuant to the Plan shall not affect in any way the right or
power of the Company to make adjustments, reclassifications, reorganizations or
changes of its capital or business structure, to merge or consolidate or to
dissolve, liquidate, sell or transfer all or any part of its business or assets.
17.5 SUBSTITUTION OF AWARDS. Notwithstanding any inconsistent
provisions or limits under the Plan, in the event the Company acquires (whether
by purchase, merger or otherwise) all or substantially all of the outstanding
capital stock or assets of another corporation or of any reorganization or other
transaction qualifying under Section 424 of the Code, the Committee may, in
accordance with the provisions of that Section, substitute options, stock
appreciation rights, performance shares or stock bonus awards under the Plan for
options, stock appreciation rights, performance shares or stock bonus awards
under the plan of the acquired company; provided, that (i) the excess of the
aggregate fair market value of the shares subject to an option immediately after
the substitution over the aggregate option price of such shares is not more than
the similar excess immediately before such substitution, (ii) the excess of the
fair market value of the shares subject to a stock appreciation right
immediately after the substitution over the base price of the stock appreciation
right is not more than the similar excess immediately before such substitution,
and (iii) the substituted award does not give persons additional benefits,
including without limitation any extension of any applicable exercise period.
18. CHANGE IN CONTROL/MAJORITY CHANGE IN CONTROL
18.1 EFFECT ON AWARDS IN THE EVENT OF A CHANGE IN CONTROL. In the event
of a Change in Control, then the Committee may in its sole discretion, without
obtaining stockholder approval, take one or more of the following actions to the
extent not inconsistent with the other provisions of the Plan:
(i) accelerate the exercise dates of all Options and SARs then
outstanding, or make such Options and SARs fully vested and exercisable as
of the date of the Change in Control, whether or not then exercisable;
(ii) deem all restrictions and conditions of all Stock Bonus
Awards then outstanding to be satisfied as of the date of the Change in
Control;
<PAGE>
(iii) deem all Performance Shares to have been fully earned as
of the date of the Change in Control; or
(iv) make any other adjustments or amendments to the Plan or
Awards.
Moreover, the Committee, in its sole discretion, may at any time, and
subject to the terms and conditions as it may impose:
(i) grant Awards that become exercisable only in the event of a
Change in Control;
(ii) provide for Awards to be exercised automatically and only
for cash in the event of a Change in Control;
(iii) substitute new Awards for old Awards; and
(iv) provide in advance or at the time of a Change in Control for
cash to be paid in settlement of any Award in the event of a Change in
Control.
In no event, however, may an acceleration payment or adjustment be made
under this Section 18.1 which, when aggregated with other payments made to the
Participant, would, in the opinion of the Committee, result in an excess
parachute payment for the Company (or, where applicable, a Subsidiary) would not
receive a federal income tax deduction by reason of Section 280G of the Code.
18.2 EFFECT ON AWARDS IN THE EVENT OF A MAJORITY CHANGE IN CONTROL.
Notwithstanding any other provision to the contrary contained herein, in the
event of a Majority Change in Control, the following shall occur automatically
25 days before the effective date of such Majority Change in Control, without
any further action on the part of the Committee, the Board or the stockholders:
(i) all outstanding Options and SARs shall become fully vested
and exercisable as of the date of the Majority Change in Control, whether
or not then exercisable;
(ii) all restrictions and conditions of all Stock Bonus Awards
then outstanding shall be deemed satisfied as of the date of the Majority
Change in Control; and
(iii) all Performance Shares shall be deemed to have been fully
earned as of the date of the Majority Change in Control.
In no event, however, may an acceleration payment or adjustment be
made under this Section 18.2 which, when aggregated with other payments made to
the Participant, would, in the opinion of the Committee, result in an excess
parachute payment for the Company (or, where applicable, a Subsidiary) would not
receive a federal income tax deduction by reason of Section 280G of the Code.
18.3 TERMINATION OF EMPLOYMENT. Notwithstanding anything contained in
this Plan to the contrary, in the event a Change in Control or a Majority Change
in Control takes place and a Participant's employment or status as a consultant
is terminated prior to the completed Change in Control or Majority Change in
Control, as the case may be, and the Participant reasonably demonstrates that
such termination (i) was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect a Change in Control or
a Majority Change in Control, as the case may be, and who effectuates the Change
in Control or Majority Change in Control, as the case may be, or (ii) otherwise
occurred in connection with or in anticipation of a Change in Control or
Majority Change in Control, as the case may be, which actually occurs, then for
all purposes of this Plan, the date of the Change in Control or Majority Change
in Control, as the case may be, in respect of such Participant shall mean the
date immediately prior to the date of termination of such Participant's
employment.
19. FORM OF AWARDS. Nothing contained in the Plan nor any resolution
adopted or to be adopted by the Board or the stockholders of the Company shall
constitute the granting of any Award. An Award shall be granted hereunder at
such date or dates as the Committee may determine, subject to the Plan. Whenever
the Committee determines to grant an Award, the Secretary or the President of
the Company, or such other person as the Committee appoints, shall send notice
thereof to the Participant, in such form as the Committee approves, stating the
number of Shares and SARs subject to the Award, its Term, and the other
provisions, restrictions and conditions thereof. The notice shall be accompanied
by a written Award Agreement (and in the case of a Stock Bonus Award, by a blank
stock power and/or escrow agreement for execution by the Participant) which
shall have been duly executed by or on behalf of the Company. If the surrender
of previously issued Awards is made a condition of the grant, the notice shall
set forth the pertinent details of such condition. Execution of an Award
Agreement by the recipient in accordance with the provisions of the Plan shall
be a condition precedent to the exercise or settlement of any Award.
<PAGE>
20. WITHHOLDING FOR TAXES.
20.1 COMPANY'S RIGHT TO PAYMENT FOR TAXES REQUIRED TO BE WITHHELD. If
the Company determines that it is required to withhold state or federal income
tax upon the issuance of Shares pursuant to an Award, the Company shall have the
right, before any payment is made or a certificate for any Shares is delivered
or any Shares are credited to any brokerage account, to deduct or withhold from
any payment under the Plan any Federal, state, local or other taxes, including
transfer taxes, required by law to be withheld or to require the Participant or
his beneficiary or estate, as the case may be, to pay any amount, or the balance
of any amount, required to be withheld. The Company may elect to deduct such
taxes from any amounts payable then or any time thereafter in cash or Shares or
otherwise to the Participant. If the Participant disposes of Shares acquired
upon the exercise of an Incentive Stock Option prior to the later of the second
anniversary of the grant of such Incentive Stock Option or the first anniversary
of the issuance of Shares upon the exercise of such Incentive Stock Option, the
Company shall have the right to deduct any taxes required by law to be withheld
from any amounts otherwise payable to the Participant. In addition, the
certificate or certificates registered in the name of the beneficial holder
representing the incentive stock issued upon such exercise shall bear the
following legend during such period:
"Solely to assist the issuer of the shares represented by this
certificate, until the later of the second anniversary of the date of
grant of the Option under which the certificate was originally issued
or one year from the date of original issuance of the shares
represented by the certificate, the Transfer Agent will notify the
issuer of the shares represented hereby of any requested transfer by
the original registered holder."
20.2 PARTICIPANT ELECTION TO WITHHOLD SHARES. The Committee may permit
a Section 16 Participant to satisfy his or her tax liability with respect to the
exercise, vesting or settlement of an Award, by having the Company withhold
Shares otherwise issuable upon the exercise, vesting or settlement of the Award
if such Participant makes an irrevocable election, by way of a written statement
in a form acceptable to the Committee, at least six (6) months before the date
the Participant recognizes federal taxable income with respect to the receipt of
such Shares or during any Window Period.
21. TERMINATION OF PLAN. The Plan shall terminate ten (10) years from the
date hereof, and an Award shall not be granted under the Plan after that date
although the terms of any Awards may be amended at any date prior to the end of
its Term in accordance with the Plan. Any Awards outstanding at the time of
termination of the Plan shall continue in full force and effect according to the
terms and conditions of the Award and this Plan.
22. AMENDMENT OF THE PLAN.
22.1 STOCKHOLDER APPROVAL. The Committee may from time to time, with
respect to any Shares at the time not subject to Awards, suspend or discontinue
the Plan or revise or amend it in any respect whatsoever except that, no
amendment shall be made without the approval of the stockholders of the Company
(i) if required under Section 422 of the Code or Rule 16b-3 or (ii) if such
amendment would change the material terms of performance goals that were
previously approved by the Company's
<PAGE>
stockholders within the meaning of Proposed Treasury Regulation Section 1.162-
27(e)(4)(vi) or a successor provision, unless the Board determines that such
approval is not necessary to avoid loss of a deduction under Section 162(m) of
the Code, will not avoid such a loss of deduction or is not advisable.
Notwithstanding the discretionary authority granted to the Committee in Section
4 of the Plan, no amendment of the Plan or any Award granted under the Plan
shall impair any of the rights of any Participant, without his or her consent,
under any Award theretofore granted under the Plan.
22.2 EXCHANGE ACT. During such time that the Common Stock is registered
under the Exchange Act, the Plan shall be amended by the Committee from time to
time to the extent necessary or advisable, in the judgment of the Committee
after having consulted with the Company's counsel, to enable Section 16
Participants to obtain the benefits of such exclusions or exemptions from the
Section 16 Requirements as may be established by the Commission from time to
time by rule, regulation, administrative order or interpretation (whether such
interpretation is made by the Commission or staff) with respect to (i) the
receipt of Awards, (ii) the exercise, modification, extension, cancellation,
exchange, termination or expiration of Awards, (iii) the purchase of Common
Stock upon the exercise of Awards, (iv) the sale of Common Stock received upon
the exercise of Awards, (v) the issuance of Shares upon the grant of Awards, and
(vi) the administration of this Plan. Anything in the Plan to the contrary
notwithstanding, such amendments may be made without approval of the Company's
stockholders unless and to the extent that, in the judgment of the Committee
after consulting with the Company's counsel, stockholder approval of such an
amendment is a prerequisite to effectuating a desired exclusion or exemption
from the Section 16 Requirements.
With respect to Section 16 Participants, transactions under this Plan
are intended to comply with all applicable conditions of Rule 16b-3 or its
successors under the Exchange Act. To the extent any provision of the Plan or
action by the Committee fails to so comply, it shall be deemed null and void, to
the extent permitted by law and deemed advisable by the Committee.
23. GOVERNING LAW; REGULATIONS AND APPROVALS.
23.1 GOVERNING LAW. This Plan and the rights of all persons claiming
hereunder shall be construed and determined in accordance of the laws of the
State of California without giving effect to the conflicts of laws principles
thereof, except to the extent that such laws are preempted by federal law.
23.2 DELIVERY OF SHARES. The obligation of the Company to issue, sell
and deliver Shares with respect to any Awards granted under this Plan shall be
subject to all applicable laws, rules and regulations, including all applicable
federal and state securities laws, and the obtaining of all such approvals by
governmental agencies as may be deemed necessary or appropriate by the
Committee.
23.3 SECURITIES LAW REQUIREMENTS.
(a) Legality of Issuance. No Award shall be granted nor shall any
--------------------
Shares be issued upon the exercise of any Award unless and until the Company has
determined that:
(i) it and the Participant have taken all actions required to
register the offer and sale of the Shares under the Securities Act, or to
perfect an exemption from the registration requirements thereof;
<PAGE>
(ii) any applicable listing requirement of any stock exchange on
which the Common Stock is listed has been satisfied; and
(iii) any other applicable provision of state or federal law has
been satisfied.
(b) Restrictions on Transfer; Representations of Optionee; Legends.
--------------------------------------------------------------
Regardless of whether the offering and sale of Shares under the Plan has been
registered under the Securities Act or has been registered or qualified under
the securities laws of any state, the Company may impose restrictions upon the
sale, pledge or other transfer of such Shares (including the placement of
appropriate legends on stock certificates) if, in the judgment of the Company
and its counsel, such restrictions are necessary or desirable in order to
achieve compliance with the provisions of the Securities Act, the securities
laws of any state or any other law. In the event that the issuance of Shares
under the Plan is not registered under the Securities Act but an exemption is
available which requires an investment representation or other representation,
each Participant shall be required to represent that such Shares are being
acquired for investment, and not with a view to the sale or distribution
thereof, and to make such other representations as are deemed necessary or
appropriate by the Company and its counsel. Stock certificates evidencing
Shares acquired under the Plan pursuant to an unregistered transaction shall
bear the following restrictive legend and such other restrictive legends as are
required or deemed advisable under the provisions of any applicable law:
"THE SALE OF THE SECURITIES REPRESENTED HEREBY HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE 'ACT'). ANY TRANSFER OR PLEDGE
OF SUCH SECURITIES WILL BE INVALID UNLESS A REGISTRATION STATEMENT
UNDER THE ACT IS IN EFFECT AS TO SUCH TRANSFER OR IN THE OPINION OF
COUNSEL FOR THE ISSUER SUCH REGISTRATION IS UNNECESSARY IN ORDER FOR
SUCH TRANSFER OR PLEDGE TO COMPLY WITH THE ACT."
Any determination by the Company and its counsel in connection with
any of the matters set forth in this Section 22.3 shall be conclusive and
binding on all persons.
(c) Registration or Qualification of Securities. The Company may, but
-------------------------------------------
shall not be obligated to, register or qualify the sale of Shares under the
Securities Act or any other applicable law. The Company shall not be obligated
to take any affirmative action in order to cause the sale of Shares under the
Plan to comply with any law.
(d) Exchange of Certificates. If, in the opinion of the Company and
------------------------
its counsel, any legend placed on a stock certificate representing Shares sold
under the Plan is no longer required, the holder of such certificate shall be
entitled to exchange such certificate for a certificate representing the same
number of Shares but without such legend.
23.4 PERFORMANCE-BASED COMPENSATION. The Plan is intended to give the
Committee the authority, in its discretion, to grant Awards that qualify as
performance-based compensation under Code Section 162(m)(4)(C).
<PAGE>
24. DEFERRAL ELECTIONS. The Committee may permit any Participant receiving
an Award to elect to defer his or her receipt of a payment of cash or the
delivery of Shares that would be otherwise due such individual by virtue of the
exercise, settlement, vesting or lapse of restrictions regarding any Award made
under the Plan. If any such election is permitted, the Committee shall establish
rules and procedures for such payment deferrals, including the possible payment
or crediting of reasonable interest on such deferred amounts credited in cash
and the payment or crediting of dividend equivalents in respect of deferrals
credited in Shares.
25. MISCELLANEOUS.
25.1 EMPLOYMENT RIGHTS. Neither the Plan nor any action taken hereunder
shall be construed as giving any Participant the right to participate under the
Plan, and a grant of an Award under the Plan shall not be construed as giving
any recipient of the grant any right to be retained in the employ of the
Company.
25.2 NO TRUST OR FUND CREATED. Neither the Plan nor any grant made
hereunder shall create or be construed to create a trust or separate fund of any
kind or a fiduciary relationship between the Company and any recipient of a
grant of an Award or any other person. To the extent that any person acquires a
right to receive payments from the Company pursuant to a grant under the Plan,
such right shall be no greater than the right of any unsecured general creditor
of the Company. Nothing herein shall prevent or prohibit the Company from
establishing a trust or other arrangement for the purpose of providing for the
payment of the benefits payable under the Plan.
25.3 AWARDS TO FOREIGN NATIONALS. Without amending the Plan, Awards may
be granted to participants who are foreign nationals or who are employed outside
the United States or both, on such terms and conditions different than those
specified in the Plan as may, in the judgment of the Committee, be necessary or
desirable to further the purpose of the Plan.
25.4 OTHER PROVISIONS. As used in the Plan, and in Awards and other
documents prepared in implementation of the Plan, references to the masculine
pronoun shall be deemed to refer to the feminine or neuter, and references in
the singular or the plural shall refer to the plural or the singular, as the
identity of the person or persons or entity or entities being referred to may
require. The captions used in the Plan and in such Awards and other documents
prepared in implementation of the Plan are for convenience only and shall not
affect the meaning of any provision hereof or thereof.
26. EFFECTIVENESS OF THE PLAN. This Plan was effective on June 1, 1994; the
amendments to the original plan document were effective on June 8, 1995 and
January 6, 1996.
<PAGE>
EXHIBIT 5
---------
Paul, Hastings, Janofsky & Walker LLP
555 S. Flower Street
Twenty-Third Floor
Los Angeles, California 90071
Telephone (213) 683-6000
Facsimile (213) 627-0705
May 20, 1997
Semtech Corporation
652 Mitchell Road
Newbury Park, California 91320
Ladies and Gentlemen:
We are furnishing this opinion of counsel to Semtech Corporation, a
Delaware corporation (the "Company"), for filing as Exhibit 5 to the
Registration Statement on Form S-8 (the "Registration Statement") to be filed by
the Company with the Securities and Exchange Commission under the Securities Act
of 1933, as amended, relating to the issuance and sale by the Company of up to
an additional 800,000 shares of its Common Stock (the "Shares") upon the
exercise of stock options granted pursuant to the Company's 1994 Long-Term Stock
Incentive Plan, as amended (the "Plan").
We have examined the Certificate of Incorporation and Bylaws, each as
amended to date, of the Company, and the originals, or copies certified or
otherwise identified, of records of corporate action of the Company as furnished
to us by the Company, certificates of public officials and of representatives of
the Company, and such other instruments and documents as we deemed necessary, as
a basis for the opinions hereinafter expressed. In such examination we have
assumed the genuineness of all signatures, the authenticity of all corporate
records and other documents submitted to us and the conformity to original
documents submitted to us as certified or photostatic copies.
Based upon our examination as aforesaid, and in reliance upon our
examination of such questions of law as we
<PAGE>
deem relevant under the circumstances, we are of the opinion that the Shares,
when purchased and issued as described in the Registration Statement and in
accordance with the Plan (including the receipt of the full purchase price
therefor), will be validly issued, fully paid and nonassessable.
We express no opinion with respect to the applicability or effect of
the laws of any jurisdiction other than the Delaware General Corporation Law, as
in effect as of the date hereof.
We hereby consent to the filing of this opinion of counsel as Exhibit
5 to the Registration Statement.
Very truly yours,
/s/ Paul, Hastings, Janofsky & Walker LLP
<PAGE>
EXHIBIT 23.1
[LETTERHEAD OF ARTHUR ANDERSEN]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our report
and to all references to our firm included in or made a part of this
Registration Statement on Form S-8.
/s/ ARTHUR ANDERSEN LLP
-----------------------------
ARTHUR ANDERSEN LLP
Los Angeles, California
May 23, 1997
