Exhibit 10.1
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SEMTECH CORPORATION
LONG-TERM STOCK INCENTIVE PLAN
(As Amended and Restated)
1. THE PLAN
(a) Purpose. The purpose of this Long-Term Stock Incentive Plan (the "Plan")
is to promote the longer-term financial success of Semtech Corporation (the
"Company") by providing a means to attract, retain and award individuals who can
and do contribute to such success. By using stock-based compensation, the
recipients of awards under the Plan will further identify their interests with
those of the Company's stockholders.
(b) Effective Date. To serve this purpose, the Plan will become effective
upon its approval by the affirmative vote of a majority of the shares present or
represented by proxy at the Company's 1998 Annual Meeting of Stockholders.
2. ADMINISTRATION
(a) Committee. The Plan shall be administered by a Committee, appointed by
the Board of Directors of the Company. So long as the Company's common stock,
par value $.01 per share ("Common Stock") remain registered under the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and Section 16
Participants may receive awards, any committee authorized by the Board to
administer the Plan shall be comprised solely of two or more directors of the
Company who are Non-Employee Directors within the meaning of Rule 16b-3(b)(3)(i)
promulgated under the Exchange Act. Notwithstanding the foregoing, the Board of
Directors of the Company (the "Board") may assume, at its sole discretion,
administration of the Plan. The administrator of the Plan, whether a committee
of the Board or the full Board, is referred to herein as the "Plan
Administrator."
(b) Powers and Authority. The Plan Administrator's powers and authority
include, but are not limited to, selecting individuals who are (1) employees of
the Company or any subsidiary of the Company or other entity in which the
Company has a significant equity or other interest as determined by the Plan
Administrator, or (2) members of the Board; determining the types and terms and
conditions of all awards granted, including performance and other earnout and/or
vesting contingencies; permitting transferability of awards to third parties;
interpreting the Plan's provisions; and administering the Plan in a manner that
is consistent with its purpose.
(c) Award Prices. For Plan purposes, all stock options and stock appreciation
rights shall have an exercise price which shall reflect the average traded price
of a share of Common Stock, on the date as determined by the Plan Administrator,
or if the Common Stock is not traded on such date, the average price on the next
preceding day on which such Common Stock is traded. The applicable date shall be
the date on which the award is granted.
3. SHARES SUBJECT TO THE PLAN
(a) Maximum Shares Available for Delivery. Subject to Section 3(c), the
maximum number of shares of Common Stock that may be delivered to participants
and their beneficiaries under the Plan shall be equal to the sum of (i)
2,000,000 shares of Common Stock; (ii) any shares of Common Stock available for
future awards under the Company's 1994 Long-Term Stock Incentive Plan as of the
effective date of this Plan; (iii) any shares of Common Stock available for
future awards under the Company's 1994 Non-Employee Directors Stock Option Plan
as of the effective date of this Plan; (iv) any shares of Common Stock that are
represented by awards granted under any prior plan of the Company, which are
forfeited, expire or are canceled without the delivery of shares of Common Stock
or which result in the forfeiture of shares of Common Stock back to the Company;
and (v) up to 2,000,000 additional shares of Common Stock, if authorized by the
Board, which are reacquired in the open market or in a private transaction after
the effective date of this Plan. Collectively the shares of Common Stock subject
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to this Plan are referred to herein as "Shares." In addition, any Shares granted
under the Plan which are forfeited back to the Company because of the failure to
meet an award contingency or condition shall again be available for delivery
pursuant to new awards granted under the Plan. Any Shares covered by an award
(or portion of an award) granted under the Plan, which is forfeited or canceled,
expires or is settled in cash, shall be deemed not to have been delivered for
purposes of determining the maximum number of Shares available for delivery
under the Plan. Likewise, if any stock option is exercised by tendering Shares,
either actually or by attestation, to the Company as full or partial payment in
connection with the exercise of a stock option under this Plan or any prior plan
of the Company, only the number of Shares issued net of the Shares tendered
shall be deemed delivered for purposes of determining the maximum number of
Shares available for delivery under the Plan. Further, Shares issued under the
Plan through the settlement, assumption or substitution of outstanding awards or
obligations to grant future awards as a condition of the Company acquiring
another entity shall not reduce the maximum number of Shares available for
delivery under the Plan.
(b) Other Plan Limits. Subject to Section 3(c), the following additional
maximums are imposed under the Plan. The maximum number of Shares that may be
covered by stock options intended to comply with Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), ("Incentive Stock Options") shall
be 2,000,000. The maximum number of Shares that may be issued in conjunction
with awards granted pursuant to Section 4(d) shall be 600,000 plus up to an
additional 600,000 to the extent that such Shares are reacquired by the Company
pursuant to Section 3(a). The maximum number of Shares that may be covered by
awards granted to any one individual pursuant to Sections 4(b) and 4(c) shall be
500,000 during any consecutive three calendar years. The maximum payment that
can be made for awards granted to any one individual pursuant to Sections 4(d)
and 4(e) shall be $2,500,000 for any single or combined performance goals
established for a specified performance period. If a payment under Sections 4(d)
or 4(e) is made in Shares, the value of such Shares for determining this maximum
individual payment amount will be the closing price of a Share on the first day
of the applicable performance period. A specified performance period for
purposes of this performance goal payment limit shall not exceed a sixty (60)
consecutive month period.
(c) Payment Shares. Subject to the overall limitation on the number of Shares
that may be delivered under the Plan, the Plan Administrator may use available
Shares as the form of payment for compensation, grants or rights earned or due
under any other compensation plans or arrangements of the Company, including the
plan of any entity acquired by the Company.
(d) Adjustments for Corporate Transactions. The Plan Administrator may
determine that:
(i) In the event that the outstanding shares of Common Stock of the Company
are changed into or exchanged for a different number or kind of shares or other
securities of the Company by reason of any recapitalization, reclassification,
stock split, stock dividend, combination or subdivision, appropriate adjustment
shall be made in the number of shares available under the Plan and under any
stock awards granted under the Plan. Such adjustment to outstanding stock awards
shall be made without change in the total price applicable to the unexercised
portion of such awards, and a corresponding adjustment in the applicable option
price per share shall be made. No such adjustment shall be made which would,
within the meaning of any applicable provisions of the Code, constitute a
modification, extension or renewal of any award or a grant of additional
benefits to the holder of an award.
(ii) In case (A) the Company is merged or consolidated with another
corporation or other entity and the Company is not the surviving corporation,
(B) all or substantially all of the assets or more than 50% of the outstanding
voting stock of the Company is acquired by any other corporation or other entity
or (C) of a reorganization or liquidation of the Company, the Plan Administrator
or the governing body of any entity assuming the obligations of the Company,
shall, as to outstanding awards, either (x) make appropriate provision for the
protection of any such outstanding awards by the substitution on an equitable
basis of appropriate stock of the Company, or of the merged, consolidated or
otherwise reorganized corporation which will be issuable in respect of the
shares of Common Stock of the Company, provided that no additional benefits
shall be conferred upon participants as a result of such substitution, and the
excess of the aggregate fair market value of the shares subject to the awards
immediately after such substitution over the purchase price thereof is not more
than the excess of the aggregate fair market value of the shares subject to the
award immediately before such substitution over the purchase price thereof, or
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(y) upon written notice to the participants, provide that all unexercised awards
must be exercised within a specified number of days of the date of such notice
or they will be terminated. In any such case, the Plan Administrator may, in its
discretion, accelerate the exercise dates of outstanding awards; provided,
however, that subsections (iii) and (iv) of this paragraph (d) shall govern
acceleration of awards with respect to the events described therein. (iii) In
case of (A) any consolidation or merger involving the Company if the
shareholders of the Company immediately before such merger or consolidation do
not own, directly or indirectly, immediately following such merger or
consolidation, more than fifty percent (50%) of the combined voting power of the
outstanding voting securities or interests of the corporation (or its parent
corporation) or other entity resulting from such merger or consolidation in
substantially the same proportion as their ownership of the shares of Common
Stock immediately before such merger or consolidation; (B) any sale, lease,
license, exchange or other transfer (in one transaction or a series of related
transactions) of all, or substantially all, of the business and/or assets of the
Company or assets representing over 50% of the operating revenue of the Company;
or (C) any person (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act who is not, on April 16, 1998, a "controlling person" (as defined
in Rule 405 promulgated under the Securities Act of 1933, as amended) (a
"Controlling Person") of the Company shall become (x) the beneficial owner
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of over
50% of the Company's outstanding Common Stock or the combined voting power of
the Company's then outstanding voting securities entitled to vote generally or
(y) a Controlling Person of the Company, all outstanding awards, regardless of
the date of grant of such awards, shall immediately become exercisable with
respect to 100% of the Shares subject to such awards. This paragraph 3(d)(iii)
shall apply only to awards granted prior to October 3, 2001 and to awards
granted on or after October 3, 2001 to participants who are non-employee
directors on the date of grant.
(iv) In the event of the termination without cause of a participant within one
year following a Change in Control (as defined below) or a Constructive
Termination (as defined below) of a participant, all outstanding awards,
regardless of the date of grant of such awards, shall immediately become
exercisable with respect to 100% of the Shares subject to such awards.
For purposes of this paragraph 3(d)(iv), "Constructive Termination" shall mean
participant's voluntary termination within one year following participant's
knowledge of the occurrence of any of the following: (A) a reduction in
participant's base salary after a "Change in Control" (as defined below) from
that in effect immediately prior to the Change in Control; or (B) a material or
substantial reduction or change in job duties, responsibilities and requirements
after a Change in Control from participant's prior duties, responsibilities and
requirements immediately prior to the Change in Control. Notwithstanding the
foregoing, a termination shall not be treated as a Constructive Termination if
the participant shall have specifically consented in writing to the occurrence
of the event giving rise to the claim of Constructive Termination.
For purposes of this paragraph 3(d)(iv), "Change in Control" shall mean the
occurrence of any of the following events with respect to the Company: (A) any
consolidation or merger involving the Company if the shareholders of the Company
immediately before such merger or consolidation do not own, directly or
indirectly, immediately following such merger or consolidation, more than fifty
percent (50%) of the combined voting power of the outstanding voting securities
or interests of the corporation (or its parent corporation) or other entity
resulting from such merger or consolidation in substantially the same proportion
as their ownership of the shares of Common Stock immediately before such merger
or consolidation; (B) any sale, lease, license, exchange or other transfer (in
one transaction or a series of related transactions) of all, or substantially
all, of the business and/or assets of the Company or assets representing over
50% of the operating revenue of the Company; or (C) any person (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act) who is not, on October 3,
2001, a Controlling Person of the Company shall become (x) the beneficial owner
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of over
50% of the Company's outstanding Common Stock or the combined voting power of
the Company's then outstanding voting securities entitled to vote generally or
(y) a Controlling Person of the Company.
This paragraph 3(d)(iv) shall apply only to awards granted on or after October
3, 2001 to participants who on the date of grant are other than non-employee
directors.
4. TYPES OF AWARDS
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(a) General. An award may be granted singularly, in combination with another
award(s) or in tandem whereby exercise or vesting of one award held by a
participant cancels another award held by the participant. Any award granted
under the Plan shall be evidenced by a written agreement in form and substance
satisfactory to the Plan Administrator. These agreements must conform to the
Plan. The Plan Administrator may include such terms, consistent with the Plan,
as it determines in its discretion. Subject to Section 2(c), an award may be
granted as an alternative to or replacement of an existing award under the Plan
or under any other compensation plans or arrangements of the Company, including
the plan of any entity acquired by the Company. The types of awards that may be
granted under the Plan include:
(b) Stock Option. A stock option represents a right to purchase a specified
number of Shares during a specified period at a price per Share which is no less
than that required by Section 2(c). A stock option may be in the form of an
incentive stock option or in a form which does not qualify for favorable federal
tax treatment. The Shares covered by a stock option may be purchased by means of
a cash payment or such other means as the Plan Administrator may from time to
time permit, including without limitation (i) tendering (either actually or by
attestation) Shares valued using the market price at the time of exercise, (ii)
authorizing a third party to sell Shares (or a sufficient portion thereof)
acquired upon exercise of a stock option and to remit to the Company a
sufficient portion of the sale proceeds to pay for all the Shares acquired
through such exercise and any tax withholding obligations resulting from such
exercise; (iii) crediting toward the purchase price amounts from individuals'
deferred compensation account balances, including accrued dividend equivalent
balances; or (iv) any combination of the above.
(c) Stock Appreciation Right. A stock appreciation right is a right to receive
a payment in cash, Shares or a combination, equal to the excess of the aggregate
market price at time of exercise of a specified number of Shares over the
aggregate exercise price of the stock appreciation rights being exercised.
(d) Stock Award. A stock award is a grant of Shares or of a right to receive
Shares (or their cash equivalent or a combination of both) in the future. Each
stock award shall be subject to such conditions, restrictions and contingencies
as the Plan Administrator shall determine. These may include continuous service
and/or the achievement of performance goals. The performance goals that may be
used by the Plan Administrator for such awards shall consist of cash generation
targets, profit, revenue and market share targets, profitability targets as
measured by return ratios, and shareholder returns. The Plan Administrator may
designate a single goal criterion or multiple goal criteria for performance
measurement purposes with the measurement based on absolute Company or business
unit performances and/or on performance as compared with that of other
publicly-traded companies.
(e) Cash Award. A cash award is a right denominated in cash or cash units to
receive a payment, which may be in the form of cash, Shares or a combination,
based on the attainment of pre-established performance goals and such other
conditions, restrictions and contingencies as the Plan Administrator shall
determine. The performance goals that may be used by the Plan Administrator for
such awards shall consist of cash generation targets, profits, revenue and
market share targets, profitability targets as measured by return ratios and
shareholder returns. The Plan Administrator may designate a single goal
criterion or multiple goal criteria for performance measurement purposes with
the measurement based on absolute Company or business unit performance and/or on
performance as compared with that of other publicly-traded companies.
(f) Special Provisions for Incentive Stock Options. Stock Options granted
under the Plan which are intended to be Incentive Stock Options shall be
specifically designated as Incentive Stock Options and shall be subject to the
following additional terms and conditions: (i) Dollar Limitation. The aggregate
fair market value (determined as of the respective date or dates of the grant)
of the Shares with respect to which Incentive Stock Options granted to any
employee under the Plan (and under any other incentive stock option plans of the
Company and any parent corporation and subsidiary) are exercisable for the first
time shall not exceed $100,000 in any one calendar year. In the event that
Section 422 of the Code is amended to alter the limitation set forth therein so
that following such amendment such limitation shall differ from the limitation
set forth in this paragraph (i), the limitation of this paragraph (i) shall be
automatically adjusted accordingly.
(ii) 10% Stockholder. If any employee to whom an Incentive Stock Option is
to be granted under the Plan is at the time of the grant of such option the
owner
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of stock possessing more than 10% of the total combined voting power of all
classes of stock of the Company or of any parent corporation or any subsidiary,
then the following special provisions shall be applicable to the Incentive Stock
Option granted to such individual:
(A) The purchase price per Share subject to such Incentive Stock Options
shall not be less than 110% of the fair market value of one share of Common
Stock at the time of grant; and
(B) The option exercise period shall not exceed five years from the date of
grant.
(iii) Section 422. All Incentive Stock Options shall otherwise comply with the
provisions of Section 422 of the Code, as the same shall be amended from time to
time.
5. AWARD SETTLEMENT AND PAYMENTS
(a) Dividends and Dividend Equivalents. An award may contain the right to
receive dividends or dividend equivalent payments which may be paid currently
credited to a participant's account. Any such crediting of dividends or dividend
equivalents or reinvestment in Shares may be subject to such conditions,
restrictions and contingencies as the Plan Administrator shall establish,
including the reinvestment of such credited amounts in Share equivalents.
(b) Payments. Awards may be settled through cash payments, the delivery of
Shares, the granting of awards or combination thereof as the Plan Administrator
shall determine. Any award settlement, including payment deferrals, may be
subject to such conditions, restrictions and contingencies as the Plan
Administrator shall determine. The Plan Administrator may permit or require the
deferral of any award payment, subject to such rules and procedures as it may
establish, which may include provisions for the payment or crediting of
interest, or dividend equivalents, including converting such credits into
deferred Share equivalents.
6. PLAN AMENDMENT AND TERMINATION
(a) Amendments. The Company's Board of Directors may amend this Plan as it
deems necessary and appropriate to better achieve the Plan's purpose; provided
however, that any amendment to the Plan which would require approval of the
Company's stockholders under applicable law, or under the rules or guidelines of
any exchange or automatic quotation system on which the Shares are traded or
included, then, in any of such events, such stockholder approval of any such
amendment shall also be obtained.
(b) Plan Suspensions and Termination. The Board of Directors of the Company
may suspend or terminate this Plan at any time. Any such suspension or
termination shall not of itself impair any outstanding award granted under the
Plan or the applicable participant's rights regarding such award. If not earlier
terminated, this Plan shall terminate upon the tenth anniversary of the
effective date of the Plan. Unless an earlier termination is specified, awards
granted under the Plan shall terminate upon the tenth anniversary of their date
of grant.
7. MISCELLANEOUS
(a) No Individual Rights. No person shall have any claim or right to be
granted an award under the Plan. Neither the Plan nor any action taken hereunder
shall be construed as giving any employee or other person any right to continue
to be employed by or to perform services for the Company, any subsidiary or
related entity. The right to terminate the employment of or performance of
services by any Plan participant at any time and for any reason is specifically
reserved to the employing entity.
(b) Binding Arbitration. Any dispute or disagreement regarding participation
and/or an award recipient's rights under the Plan shall be settled solely by
binding arbitration in accordance with the applicable rules of the American
Arbitration Association.
(c) Unfunded Plan. The Plan shall be unfunded and shall not create (or be
construed to create) a trust or a separate fund or funds. The Plan shall not
establish any fiduciary relationship between the Company and any participant or
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beneficiary of a participant. To the extent any person holds any obligation of
the Company by virtue of an award granted under the Plan, such obligation shall
merely constitute a general unsecured liability of the Company and accordingly
shall not confer upon such person any right, title or interest in any assets of
the Company.
(d) Other Benefit and Compensation Programs. Unless otherwise specifically
determined by the Plan Administrator, settlements of awards received by
participants under the Plan shall not be deemed a part of a participant's
regular, recurring compensation for purposes of calculating payments or benefits
from any Company benefit plan or severance program. Further, the Company may
adopt other compensation programs, plans or arrangements as it deems
appropriate.
(e) No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any award, and the Plan Administrator shall determine
whether cash shall be paid or transferred in lieu of any fractional Shares, or
whether such fractional Shares or any rights thereto shall be canceled.
(f) Special Provision Regarding Termination of Directorship. If a participant
that is a member of the Board terminates his or her services as a member of the
Board by reason of death, disability or retirement (as defined by the Plan
Administrator in the written agreement evidencing the award to such Board
member), an award granted hereunder held by such person shall be automatically
accelerated with respect to its exercisability and shall become immediately
exercisable in full for the remaining number of Shares subject to such award for
three years after the date of such termination or until the expiration of the
stated term of such award, whichever period is shorter, and thereafter such
award shall terminate; provided, however, that if such person dies or suffers a
disability during said three-year period after retirement such award shall
remain exercisable in full for a period of three years after the date of such
death or disability or until the expiration of the stated term of such award,
whichever period is shorter, and thereafter such award shall terminate. If a
participant that is a member of the Board terminates his or her services as a
member of the Board for any other reason, any portion of an award granted
hereunder held by such person which is not then exercisable shall terminate and
any portion of such award which is then exercisable may be exercised for three
months after the date of such termination or until the expiration of the stated
term of such award, whichever period is shorter, and thereafter such award shall
terminate; provided, however, that if such person dies or suffers a disability
during such three month period, such award may be exercised for a period of one
year after the date of such person's death or disability or until the expiration
of the stated term of such award, whichever period is shorter, in accordance
with its terms, but only to the extent exercisable on the date of such person's
death or disability.
01-03-02
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