EXHIBIT 10.2
SEAGATE TECHNOLOGY
EMPLOYEE STOCK PURCHASE PLAN
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(Restated August 6, 1987)
(As Amended Through October 27, 1994)
(As Amended Through April, 1997)
(As Amended Through August, 1998)
The following constitutes the provisions of the Employee Stock Purchase
Plan (herein called the "Plan") of Seagate Technology (herein called the
"Company").
1. Purpose. The purpose of the Plan is to provide employees of the
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Company and its Designated Subsidiaries (as defined in paragraph 2(f)) with an
opportunity to purchase Common Stock of the Company through payroll deductions.
It is the intention of the Company that the Plan qualify as an "Employee Stock
Purchase Plan" under Section 423 of the Internal Revenue Code of 1986 (the
"Code"). The provisions of the Plan shall, accordingly, be construed so as to
extend and limit participation in a manner consistent with the requirements of
that section of the Code.
2. Definitions.
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(a) "Board" means the Board of Directors of the Company.
(b) "Common Stock" means the Common Stock, $0.01 par value, of the
Company.
(c) "Compensation" means base pay, excluding all other emoluments such
as amounts attributable to overtime, shift premium, incentive compensation,
bonuses and commissions; except that commissions paid with respect to the
Company's sales activities shall be treated as a part of base pay. The Board or
its Committee
(as defined in Paragraph 13) may specifically direct the inclusions of any
excluded item of compensation in a manner consistent with the requirements of
Section 423 of the Code, as provided in Paragraph 1, but subject to the
limitations contained in Paragraph 19 hereof.
(d) "Employee" means any person, including an officer, who is employed
by the Company or one of its Designated Subsidiaries.
(e) "Subsidiary" means any corporation, domestic or foreign, in which
the Company owns, directly or indirectly, 50% or more of the voting shares.
(f) "Designated Subsidiaries" means the Subsidiaries which have been
designated by the Board from time to time in its sole discretion as eligible to
participate in the Plan.
(g) "Offering Date" means the first day of each offering period of the
Plan.
(h) "Termination Date" means the last day of each offering period of
the Plan.
3. Eligibility.
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(a) General Rule. Any employee, as defined in paragraph 2, who has
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been employed by the Company or one of its Designated Subsidiaries for at least
30 days prior to the Offering Date shall be eligible to participate in the Plan,
subject to the limitations imposed by Section 423(b) of the Code.
(b) Exceptions. Any provisions of the Plan to the contrary
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notwithstanding, no employee shall be granted an option under the Plan if,
(i) immediately after the grant, such employee (or any other person whose
stock ownership would be attributed to such employee pursuant to
Section 425(d) of the Code) would
own shares and/or hold outstanding options to purchase shares
possessing five percent (5%) or more of the total
combined voting power or value of all classes of shares of the Company
or of any subsidiary of the Company, or
(ii) the rate of withholding under such option would permit the employee's
rights to purchase shares under all employee stock purchase plans of
the Company and its subsidiaries to accrue (i.e., become exercisable)
at a rate which exceeds Twelve Thousand Five Hundred Dollars ($12,500)
of fair market value of such shares (determined at the time such
option is granted) for each offering period.
4. Offerings. The Plan shall be implemented by one offering during each
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six month period of the Plan, commencing on September 24, 1981, the date of
effectiveness with the Securities and Exchange Commission of the Company's
Registration Statement on Form S-1 relating to its initial public offering and
continuing thereafter until terminated in accordance with paragraph 19 hereof.
5. Participation.
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(a) An eligible employee may become a participant in the Plan by
completing a subscription agreement authorizing payroll deductions on the form
provided by the Company and filing it with the Company's payroll office not less
than 15 days prior to the applicable Offering Date, unless a later time for
filing the subscription agreement is set by the Board for all eligible
employees with respect to a given offering.
(b) Payroll deductions for a participant shall commence with the first
payroll following the Offering Date, or the first payroll following the date of
valid filing of the subscription agreement, whichever is later, and shall end on
the Termination Date of the offering, unless sooner terminated by the
participant as provided in paragraph 10.
6. Payroll Deductions.
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(a) At the time a participant files his subscription agreement, he
shall elect to have payroll deductions made on each payday during the offering
period at a rate not exceeding ten percent (10%), or such other maximum rate
as may be determined from time to time by the Board, of the Compensation which
he would otherwise receive on such payday, provided that the aggregate of such
payroll deductions during the offering period shall not exceed ten percent
(10%), or such other maximum percentage as may be
determined from time to time by the Board, of the Compensation which he would
otherwise have received during said offering period.
(b) All payroll deductions authorized by a participant shall be
credited to his account under the Plan. A participant may not make any
additional payments into such account.
(c) A participant may discontinue his participation in the Plan as
provided in paragraph 10, but may not decrease or increase the rate of his
payroll deductions during the offering period.
7. Grant of Option.
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(a) On each Offering Date, each participant shall be granted an option
to purchase (at the option price) the number of full shares of the Company's
Common Stock arrived at by dividing such participant's total payroll deductions
accumulated during such offering period by the lower of (i) eighty-five percent
(85%) of the fair market value of a share of the Company's Common Stock at the
Offering Date, or (ii) eighty-five percent (85%) of the fair market value of a
share of the Common Stock of the Company at the Termination Date, subject to the
limitations set forth in paragraphs 3(b) and 12 hereof. The fair market value
of a share of the Company's Common Stock shall be determined as provided in
paragraph 7(b) herein.
(b) The option price per share of such shares shall be the lower of:
(i) 85% of the fair market value of a share of the
Common Stock of the Company at the Offering Date; or (ii) 85% of the fair market
value of a share of the Common Stock of the Company at the Termination Date
unless: (a) the number of shares available for grant on the first day of the
offering period is less than the number of shares required to be issued for that
offering period, and (b) the fair market value of the Company's stock on the
date additional shares are authorized by the stockholders is higher than it was
on the first day of the offering period, in which case the offering price shall
be the lower of (i) 85% of the fair market value on the date additional shares
are authorized by the stockholders or (ii) 85% of the fair market value on the
last day of the offering period. The fair market value of the Company's Common
Stock on said dates shall be determined by the Company's Board of Directors,
based upon such factors as the Board determines relevant; provided, however,
that if there is a public market for the Common Stock, the fair market value of
a share of Common Stock on a given date shall be the reported bid price for the
Common Stock as of such date; or, in the event that the Common Stock is listed
on a stock exchange, the fair market value of a share of Common Stock shall be
the closing price on the exchange as of such date.
8. Exercise of Option. Unless a participant withdraws from the Plan as
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provided in paragraph 10, his option for the purchase of shares will be
exercised automatically at the Termination Date,
and the minimum number of full shares subject to option will be purchased for
him at the applicable option price with the accumulated payroll deductions in
his account. During his lifetime, a participant's option to purchase shares
hereunder is exercisable only by him.
9. Delivery. As promptly as practicable after the Termination Date of
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each offering, the Company shall arrange the delivery to each participant, as
appropriate, of a certificate representing the shares purchased upon exercise of
his option. Any cash remaining to the credit of a participant's account under
the Plan after a purchase by him of shares at the Termination Date of each
offering period shall be returned to said participant.
10. Withdrawal; Termination of Employment.
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(a) A participant may withdraw all, but not less than all, the payroll
deductions credited to his account under the Plan at any time prior to the
Termination Date by giving written notice to the Company on a form provided for
such purpose. All of the participant's payroll deductions credited to his
account will be paid to him as soon as practicable after receipt of his notice
of withdrawal, and his option for the current offering period will be
automatically cancelled, and no further payroll deductions for the purchase of
shares will be made during such offering period.
(b) Upon termination of the participant's employment for any reason,
including retirement or death, the payroll deductions
accumulated in his account will be returned to him as soon as practicable after
such termination or, in the case of his death, to the person or persons entitled
thereto under paragraph 14, and his option will be automatically cancelled.
(c) A participant's withdrawal from an offering will not have any
effect upon his eligibility to participate in a succeeding offering or in any
similar plan which may hereafter be adopted by the Company.
11. Interest. No interest shall accrue on the payroll deductions of a
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participant in the Plan.
12. Stock.
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(a) The maximum number of shares of the Company's Common Stock which
shall be reserved for sale under the Plan shall be 19,600,000 shares, subject
to further adjustment upon changes in capitalization of the Company as
provided in paragraph 18. The shares to be sold to participants in the Plan
may be, at the election of the Company, either treasury shares or shares
authorized but unissued. If the total number of shares which would otherwise
be subject to options granted pursuant to paragraph 7(a) hereof at the
Offering Date exceeds the number of shares then available under the Plan
(after deduction of all shares for which options have been exercised or are
then outstanding), the Company shall make a pro rata allocation of the shares
remaining available for option grant in as uniform and equitable a manner as
is practicable. In such
event, the Company shall give written notice of such reduction of the number of
shares subject to the option to each participant affected thereby and shall
return any excess funds accumulated in each participant's account as soon as
practicable after the termination date of such offering period.
(b) The participant will have no interest or voting right in shares
covered by his option until such option has been exercised.
(c) Shares to be delivered to a participant under the Plan will be
registered in the name of the participant or in the name of the participant and
his spouse.
13. Administration. The Plan shall be administered by the Board of
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Directors of the Company or a committee (the "Committee") appointed by the
Board. The administration, interpretation or application of the Plan by the
Board or the Committee shall be final, conclusive and binding upon all
participants. Members of the Board or the Committee who are eligible employees
are permitted to participate in the Plan, provided that:
(a) Members of the Board who are eligible to participate in the Plan
may not vote on any matter affecting the administration of the Plan or the grant
of any option pursuant to the Plan.
(b) No member of the Board who is eligible to participate in the Plan
may be counted in determining the existence of a
quorum at any meeting of the Board during which action is taken with respect to
the granting of options pursuant to the Plan.
(c) If a Committee is established to administer the Plan, no member of
the Board who is eligible to participate in the Plan may be a member of the
Committee.
14. Designation of Beneficiary.
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(a) A participant may file a written designation of a beneficiary who
is to receive shares and/or cash, if any, from the participant's account under
the Plan in the event of such participant's death at a time when cash or
shares are held for his account.
(b) Such designation of beneficiary may be changed by the participant
at any time by written notice. In the event of the death of a participant in
the absence of a valid designation of a beneficiary who is living at the time of
such participant's death, the Company shall deliver such shares and/or cash to
the executor or administrator of the estate of the participant; or if no such
executor or administrator has been appointed (to the knowledge of the Company),
the Company, in its discretion, may deliver such shares and/or cash to the
spouse or to any one or more dependents or relatives of the participant; or if
no spouse, dependent or relative is known to the Company, then to such other
person as the Company may designate.
15. Transferability. Neither payroll deductions credited to a
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participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution, or as provided in paragraph 14 hereof) by the participant. Any
such attempt at assignment, transfer, pledge or other disposition shall be
without effect, except that the Company may treat such act as an election to
withdraw funds in accordance with paragraph 10.
16. Use of Funds. All payroll deductions received or held by the Company
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under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.
17. Reports. Individual accounts will be maintained for each participant
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in the Plan. Statements of account will be given to participating employees
semi-annually as soon as practicable following the Termination Date, which
statements will set forth the amounts of payroll deductions, the per share
purchase price, the number of shares purchased and the remaining cash balance,
if any.
18. Adjustments Upon Changes in Capitalization. Subject to any required
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action by the shareholders of the Company, the number of shares of Common Stock
covered by each option under the Plan which has not yet been exercised and the
number of shares of Common Stock which have been authorized for issuance under
the Plan but
have not yet been placed under option (collectively, the "Reserves"), as well as
the price per share of Common Stock covered by each option under the Plan which
has not yet been exercised, shall be proportionately adjusted for any increase
or decrease in the number of issued shares of Common Stock resulting from a
stock split or the payment of a stock dividend (but only on the Common Stock) or
any other increase or decrease in the number of shares of Common Stock effected
without receipt of consideration by the Company; provided, however, that
conversion of any convertible securities of the Company shall not be deemed to
have been "effected without receipt of consideration". Such adjustment shall be
made by the Board, whose determination in that respect shall be final, binding
and conclusive. Except as expressly provided herein, no issue by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock subject to option.
The Board may, if it so determines in the exercise of its sole discretion,
also make provision for adjusting the Reserves, as well as the price per share
of Common Stock covered by each outstanding option, in the event that the
Company effects one or more reorganizations, recapitalizations, rights
offerings or other increases or reductions of shares of its outstanding Common
Stock, and in the
event of the Company being consolidated with or merged into any other
corporation.
19. Amendment or Termination. The Board of Directors of the Company may
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at any time terminate or amend the Plan. No such termination will affect
options previously granted, nor may an amendment make any change in any option
theretofore granted which adversely affects the rights of any participant, nor
may an amendment be made without prior approval of the shareholders of the
Company if such amendment would:
(a) Increase the number of shares that may be issued under the Plan;
(b) Materially modify the requirements as to eligibility for
participation in the Plan; or
(c) Materially increase the benefits which may accrue to participants
under the Plan.
20. Notices. All notices or other communications by a participant to the
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Company in connection with the Plan shall be deemed to have been duly given when
received in the form specified by the Company at the location, or by the person,
designated by the Company for the receipt thereof.
21. Shareholder Approval. Continuance of the Plan shall be subject to
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approval by the affirmative vote of the holders of a majority of the outstanding
shares of the Company present or represented and entitled to vote thereon,
which approval shall be:
(a) (1) solicited substantially in accordance with Section 14(a) of
the Securities Act of 1934, as amended (the "Act") and the rules and regulations
promulgated thereunder, or (2) solicited after the Company has furnished in
writing to the holders entitled to vote substantially the same information
concerning the Plan as that which would be required by the rules and regulations
in effect under Section 4(a) of the Act at the time such information is
furnished; and
(b) obtained at or prior to the first annual meeting of shareholders
held subsequent to the first registration of Common Stock under Section 12 of
the Act.
In the case of approval by written consent, the shares "present
or represented" shall mean all outstanding shares.
22. Conditions Upon Issuance of Shares. Shares shall not be issued with
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respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.
As a condition to the exercise of an option and if required by applicable
securities laws, the Company may require the participant for whose account the
option is being exercised to represent and warrant at the time of any such
exercise that the shares are being purchased only for investment and without any
present intention to sell or distribute such shares if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned applicable provisions of law.
SEAGATE TECHNOLOGY
EMPLOYEE STOCK PURCHASE PLAN
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SUBSCRIPTION AGREEMENT
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______ Original Application
______ Change in Payroll Deduction Rate
______ Change of Beneficiary(ies)
1. ___________________________________ hereby elects to participate in the
SEAGATE TECHNOLOGY Employee Stock Purchase Plan (the "Plan") and subscribes
to purchase shares of the Company Common Stock in accordance with this
Agreement and the Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount of
______% of my base pay in accordance with the Plan.
3. I understand that said payroll deductions shall be accumulated for the
purchase of shares in accordance with the Plan, and that shares will be
purchased for me automatically at the end of the offering period unless I
withdraw from the Plan by giving written notice to the Company.
4. I understand that prior to the delivery of any shares I will receive a copy
of the Company's most recent prospectus which describes the Plan. A copy
of the complete "Seagate Technology Employee Stock Purchase Plan" is on
file with the Company.
5. Shares purchased for me under the Plan should be issued in the name(s) of:
_____________________________________________________________
_____________________________________________________________
_____________________________________________________________
6. I understand that if I dispose of any shares received by me pursuant to the
Plan within 2 years after the first day of the offering period during which
I purchased such shares or within 1 year after the date on which such
shares were delivered to me, I may be treated for federal income tax
purposes as having received ordinary income at the time of such disposition
in an amount equal to the excess of the fair market value of the shares at
the time such shares were delivered to me over the option price paid for
the shares. I hereby agree to notify the Company in writing within 30 days
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after the date of any such disposition. However, if I dispose of such
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shares at any
time after the expiration of the 2-year and 1-year holding periods, I
understand that I will be treated for federal income tax purposes as
having received income only at the time of such disposition, and that such
income will be taxed as ordinary income only to the extent of an amount
equal to the lesser of (1) the excess of the fair market value of the
shares at the time of such disposition over the amount paid for the shares
under the option, or (2) the excess of the fair market value of the shares
over the option price, measured as if the option had been exercised on the
first day of the offering period during which I purchased such shares. The
remainder of the gain, if any, recognized on such disposition will be taxed
at capital gains rates.
7. I hereby agree to be bound by the terms of the Plan. The effectiveness of
this Subscription Agreement is dependent upon my eligibility to participate
in the Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the Plan:
NAME: (Please print) ________________________________________
First Middle Last
______________________ ________________________________________
Relationship
________________________________________
Address
NAME: (Please print) ________________________________________
First Middle Last
______________________ ________________________________________
Relationship
________________________________________
Address
Date: ____________________ _____________________________
Signature of Employee
_________________________________________________________________
_________________________________________________________________
I do not wish to participate in the Employee Stock Purchase Plan.
Date: ___________________ _____________________________________
Signature of Employee