UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 20, 2006
Analog Devices, Inc.
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(Exact name of registrant as specified in its charter)
Massachusetts 1-7819 04-2348234
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(State or other jurisdiction (Commission (IRS Employer
of incorporation File Number) Identification No.)
One Technology Way, Norwood, MA 02062
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (781) 329-4700
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
Board of Directors Compensation
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On September 20, 2006, the Board of Directors of Analog Devices, Inc.
(the "Registrant"), having received and considered the recommendations of the
Compensation Committee of the Board of Directors, approved various matters
relating to the cash and equity compensation of the non-employee members of the
Board of Directors, effective October 29, 2006.
Cash Compensation - Board
On September 20, 2006, the Board increased the annual cash retainers
payable to each non-employee member of the Board of Directors of the Registrant
from $40,000 to $60,000 per fiscal year, effective October 29, 2006. Such cash
retainers shall be paid in quarterly installments of $15,000 each on the 15th
day of December, March, June and September of each fiscal year.
Cash Compensation - Committee Chairpersons
On September 20, 2006, the Board increased the annual cash retainers
payable to each of the Chairpersons of the Audit Committee and the Compensation
Committee of the Board of Directors from $10,000 to $15,000 per fiscal year,
effective October 29, 2006. Such cash retainers shall be paid in quarterly
installments of $3,750 each on the 15th day of December, March, June and
September of each fiscal year. The annual cash retainer payable to the
Chairperson of the Nominating and Corporate Governance Committee of the Board of
Directors shall remain at $10,000 per fiscal year and shall be paid in quarterly
installments of $2,500 each on the 15th day of December, March, June and
September of each fiscal year.
Equity Compensation
On September 20, 2006, the Board established the following stock option
grant policy for non-employee members of the Board of Directors, effective
October 29, 2006:
Initial Grants. Each newly elected non-employee Director shall
automatically be granted a Non-Qualified Stock Option to purchase 15,000 shares
of Common Stock of the Registrant under the Registrant's 2006 Stock Incentive
Plan (the "2006 Plan") on the 15th day of the month following the date of
initial election as a Director, or if the New York Stock Exchange is closed on
that day, the next succeeding business day that the New York Stock Exchange is
open, at an option exercise price equal to the fair market value of the Common
Stock on the date of grant (which shall equal the closing price of the Common
Stock on the date of grant, unless otherwise determined by the Compensation
Committee), and vesting and becoming exercisable with respect to the shares
covered thereby in three equal installments on each of the first, second and
third anniversaries of the date of grant. Upon the occurrence of a Change in
Control Event (as defined in the 2006 Plan), the vesting of each such option
shall be fully accelerated and the option shall thereafter be exercisable in
full over the remaining term thereof.
Annual Grants. On an annual basis, each incumbent non-employee Director
shall automatically be granted a Non-Qualified Stock Option to purchase 15,000
shares of Common Stock of the Registrant under the 2006 Plan (with the number of
shares subject to the first annual option granted to a Director to be on a pro
rata basis based on the length of service during the calendar year in which such
Director was elected) on the second business day following January 1 that the
New York Stock Exchange is open, at an option exercise price equal to the fair
market value of the Common Stock on the date of grant (which shall equal the
closing price of the Common Stock on the date of grant, unless otherwise
determined by the Compensation Committee), and vesting and becoming exercisable
with respect to the shares covered thereby in three equal installments on each
of the first, second and third anniversaries of the date of grant. Upon the
occurrence of a Change in Control Event (as defined in the 2006 Plan), the
vesting of each such option shall be fully accelerated and the option shall
thereafter be exercisable in full over the remaining term thereof.
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Forms for Usage under 2006 Stock Incentive Plan
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The Compensation Committee administers, among other things, the 2006
Plan. The Compensation Committee has approved the following forms for usage
under the 2006 Plan: (i) Confirming Memorandum for Grants of Non-Qualified Stock
Options to Employees, (ii) Restricted Stock Agreement, and (iii) Restricted
Stock Unit Confirming Memorandum. All of the Registrant's employees (including
executive officers), directors, consultants and advisors are eligible to receive
options, stock appreciation rights, restricted stock, restricted stock units and
other stock-based awards under the 2006 Plan. The 2006 Plan and the forms for
usage thereunder are filed or incorporated by reference as exhibits hereto and
are incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Exhibit No. Description
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99.1 2006 Stock Incentive Plan of the Registrant, incorporated herein
by reference to Appendix A of the Registrant's Definitive Proxy
Statement on Schedule 14A filed with the Securities and Exchange
Commission on February 8, 2006 (File No. 1-7819).
99.2 Form of Confirming Memorandum for Grants of Non-Qualified Stock
Options to Employees for usage under the Registrant's 2006 Stock
Incentive Plan.
99.3 Form of Restricted Stock Agreement for usage under the
Registrant's 2006 Stock Incentive Plan.
99.4 Form of Restricted Stock Unit Confirming Memorandum for usage
under the Registrant's 2006 Stock Incentive Plan.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: September 25, 2006 ANALOG DEVICES, INC.
By: /s/ Margaret K. Seif
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Margaret K. Seif
Vice President, General Counsel and
Secretary
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EXHIBIT INDEX
Exhibit No. Description
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99.1 2006 Stock Incentive Plan of the Registrant, incorporated herein
by reference to Appendix A of the Registrant's Definitive Proxy
Statement on Schedule 14A filed with the Securities and Exchange
Commission on February 8, 2006 (File No. 1-7819).
99.2 Form of Confirming Memorandum for Grants of Non-Qualified Stock
Options to Employees for usage under the Registrant's 2006 Stock
Incentive Plan.
99.3 Form of Restricted Stock Agreement for usage under the
Registrant's 2006 Stock Incentive Plan.
99.4 Form of Restricted Stock Unit Confirming Memorandum for usage
under the Registrant's 2006 Stock Incentive Plan.
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EXHIBIT 99.2
STOCK OPTION CONFIRMING MEMORANDUM
GRANT OF NON-QUALIFIED STOCK OPTION
Private & Confidential (Addressee Only)
2006 STOCK INCENTIVE PLAN: GENERAL VERSION
Division: --- COMPANY CODE: --- VESTING CODE:
Location: --- PLAN CODE:
We are pleased to advise you that you have been granted an option to purchase
#,### shares of Analog Devices, Inc. Common Stock on the terms and conditions
set forth below (the "Option"). The grant of this Option reflects Analog's
confidence in your commitment and contributions to the success and continued
growth of Analog Devices, Inc. (the "Company").
GRANT OF OPTION: This memorandum confirms that, subject to the terms and
conditions of the Analog Devices, Inc. 2006 Stock Incentive Plan (the "Plan"),
the Company has granted to you (the "Optionee"), effective on the Date of Grant
set forth below, an option to purchase shares of the Company's Common Stock (the
"Option Shares") as follows:
Date of Grant: 99/99/9999
Number of Option Shares Granted: #,###
Option Exercise Price Per Share: $ ##.##
ALL TERMS NOT DEFINED HEREIN SHALL HAVE THE MEANINGS ASSIGNED TO SUCH TERMS IN
THE PLAN.
EXERCISE OF OPTION: The Option is exercisable as follows:
EXERCISE PERIOD NUMBER OF SHARES
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Vesting Period #1 #,###
Vesting Period #2 #,###
Vesting Period #3 #,###
The right of exercise is cumulative, so that if the Option is not exercised to
the maximum extent permissible during any period, it is exercisable, in whole or
in part, with respect to all shares not so purchased at any time during any
subsequent period prior to the expiration or termination of the Option.
TERM OF OPTION; TERMINATION OF EMPLOYMENT:
1. The term of the Option is ten (10) years after the Date of Grant,
subject, however, to the early termination provisions set forth
herein.
2. Except as otherwise provided herein, the Option shall be exercisable
by the Optionee (or his/her successor in interest) following the
termination of the Optionee's employment only to the extent that the
Option was exercisable on or prior to the date of such termination.
3. The Option shall terminate on the date the Optionee voluntarily
terminates employment with the Company or one of its subsidiaries or
on the date his/her employment is terminated by the Company without
"Cause" (as defined in paragraph 4), but the Option Shares which are
exercisable on the date of such termination shall continue to be
exercisable for a period of three (3) months following such
termination date.
4. The Option shall terminate on the date the Optionee's employment with
the Company or one of its subsidiaries is terminated by the Company
for "Cause", and all Option Shares which are then exercisable shall
forthwith cease to be exercisable. "Cause" for this purpose means
unsatisfactory job performance (as determined by the Company), willful
misconduct, fraud, gross negligence, disobedience or dishonesty.
5. Upon the death of the Optionee while he/she is an employee of the
Company or one of its subsidiaries, the Option shall become
exercisable in full on the date of death and shall continue to be
exercisable (by the Optionee's successor in interest) over the
remaining term of the Option.
6. If the employment of the Optionee terminates due to disability (as
determined by the Company), the Option Shares which are not
exercisable as of the date of disability shall become exercisable on
the date or dates (over the remaining term of the Option) that they
otherwise would have become exercisable if the Optionee's employment
had not been terminated due to disability. Any Option Shares that are
exercisable upon disability prior to giving effect to this provision
shall continue to be exercisable over the remaining term of the
Option.
As used herein, the terms "employment" and "employee" shall mean and include any
one of the following relationships with the Company: director, employee,
consultant or advisor.
PAYMENT OF PURCHASE PRICE: The following payment methods may be used to
purchase Option Shares:
1. A cashless exercise in a manner described in the Plan.
2. Cash or check payable to the Company.
3. Delivery by the Optionee of shares of Common Stock of the Company that
have been owned by the Optionee for at least six months and subject to
such other terms and conditions contained in the Plan.
4. Any combination of the above methods.
NON-TRANSFERABILITY OF OPTION: Except as provided by will or the laws of
descent and distribution, this Option is personal and no rights granted
hereunder shall be transferred, assigned, pledged, or hypothecated in any way
(whether by operation of law or otherwise), nor shall any such rights be subject
to execution, attachment or similar process.
ADJUSTMENT: This Option is subject to adjustment (including with respect to
vesting of the Option Shares) upon certain changes in the Company's common stock
and certain other events, including a Change in Control Event or a
Reorganization Event, as provided in Section 11 of the Plan.
WITHHOLDING TAXES: As a condition to the issuance of shares upon exercise
of the Option, the Company may require the Optionee to remit to the Company an
amount sufficient to satisfy federal, state and local withholding tax
requirements.
A copy of the Plan prospectus and brochure describing the principal features of
the Plan is available on the Company's Intranet at www.analog.com/employee (from
Signals home page, click Knowledge Centers, Employee Stock Programs. The related
documents can be found in the right-hand column). If you have any questions
regarding your stock option, please contact your regional stock plan
administrator, Jennifer Baptiste at (781) 461-3889 or
Jennifer.Baptiste@Analog.com; or Fran Sarro, Assistant Treasurer, at (781)
461-3907 or email Fran.Sarro@Analog.com. If you are unable to access this
information via the Intranet, your regional stock plan administrator can provide
you with copies.
/s/ Ray Stata /s/ Jerald G. Fishman
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Ray Stata Jerald G. Fishman
Chairman of the Board President & Chief Executive Officer
EXHIBIT 99.3
ANALOG DEVICES, INC.
Standard Terms and Conditions Relating to Restricted Stock
Granted Under 2006 Stock Incentive Plan
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1. Restricted Stock Grant. Analog Devices, Inc., a Massachusetts corporation
(the "Company"), hereby grants to the person named on the Confirmation of
Restricted Stock Grant (the "Participant") to which these Standard Terms and
Conditions are appended (the "Confirmation") that number of shares of common
stock, $0.16 2/3 par value, of the Company ("Common Stock"), specified on the
Confirmation (the "Shares") without the payment of any cash by the Participant.
The Company shall issue to the Participant, subject to the terms and conditions
set forth herein (these "Standard Terms" and, together with the Confirmation,
this "Agreement") and in the Company's 2006 Stock Incentive Plan (the "Plan"),
the Shares as of the date set forth on the Confirmation (the "Grant Date"). The
Shares will be held in book entry by the Company's transfer agent in the name of
the Participant for that number of Shares issued to the Participant. The
Participant agrees that the Shares shall be subject to the forfeiture provisions
set forth in Section 2 of these Standard Terms, the restrictions on transfer set
forth in Section 3 of these Standard Terms and the right of the Company to
retain Shares pursuant to Section 7 of these Standard Terms.
2. Vesting.
(a) Subject to the terms of the Plan and this Agreement, the Shares shall
vest and become free from the forfeiture provisions in Section 2(b) hereof and
become free from the transfer restrictions in Section 3 hereof in accordance
with the schedule set forth in the Confirmation. For purposes of this Agreement,
Shares that have not vested as of any particular time in accordance with this
Section 2(a), are referred to as "Unvested Shares."
(b) In the event that the Participant's employment with the Company is
terminated either by the Participant or by the Company for any reason or no
reason (other than due to death or disability, each as provided below), then in
each such case, all of the Unvested Shares as of the date of termination shall
be forfeited immediately and automatically to the Company without any payment by
the Company and the Participant shall have no further rights with respect to
such Unvested Shares.
(c) In the event that the Participant's employment with the Company is
terminated by reason of the Participant's death, all Unvested Shares shall vest
in full as of the date of his or her death.
(d) In the event that the Participant's employment with the Company
terminates due to disability (as determined by the Company), the Unvested Shares
as of the date of his or her disability shall continue to vest in accordance
with the original vesting schedule as if the Participant continued to be
employed by the Company.
(e) For purposes of this Agreement, employment with the Company shall
include employment with a parent or subsidiary of the Company, or any successor
to the Company.
3. Restrictions on Transfer; Restrictive Legends.
(a) The Participant shall not sell, assign, transfer, pledge or otherwise
encumber any Shares, either voluntarily or by operation of law, except by will
or the laws of descent and distribution, until such Shares have vested.
(b) The Company shall not be required (i) to transfer on its books any of
the Shares which have been transferred in violation of any of the provisions set
forth herein or (ii) to treat as owner of such Shares or to pay dividends to any
transferee to whom such Shares have been transferred in violation of any of the
provisions contained herein.
(c) All Unvested Shares shall bear the following restriction, in addition
to any other legends that may be required under federal or state securities
laws:
"The shares of stock represented by this certificate are
subject to forfeiture provisions and restrictions on transfer
set forth in a certain Confirmation of Restricted Stock Grant,
including the related Standard Terms and Conditions, between
the corporation and the registered owner of these shares (or
his predecessor in interest), and such document is available
for inspection without charge at the office of the Secretary
of the corporation."
4. Waiver of Cash Dividends. The Participant hereby irrevocably waives all
rights and interests in and to any and all cash dividends declared by the
Company with respect to any Shares that are Unvested Shares as of the record
date applicable to such cash dividend and shall have no right to receive any
such declared dividends even if and when such Unvested Shares vest.
5. Provisions of the Plan. The Shares, including the grant and issuance
thereof, are subject to the provisions of the Plan. A copy of the Plan
prospectus and brochure describing the principal features of the Plan is
available on the Company's Intranet at www.analog.com/employee (from Signals
home page, click Knowledge Centers, Employee Stock Programs. The related
documents can be found in the right-hand column).
6. Consideration. The Shares granted hereby are in consideration of the
Participant's entering into employment with the Company and/or his continued
employment with the Company.
7. Withholding Taxes; Section 83(b) Election.
(a) The Participant acknowledges and agrees that the Company has the right
to deduct from payments of any kind otherwise due to the Participant any
federal, state, local or other taxes of any kind required by law to be withheld
with respect to the issuance of the Shares to the Participant or the lapse of
the forfeiture provisions. The Participant hereby authorizes and instructs the
Company to retain that number of fully vested whole Shares valued at their Fair
Market Value on the date of the event creating such withholding obligation
(which shall equal the closing price of the Common Stock on the New York Stock
Exchange on such date or, if such date is not a trading date, on the next
following trading date) as is sufficient in the opinion of the Company to
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satisfy such tax obligations. In the event the withholding tax obligation would
result in a fractional number of shares to be withheld by the Company, such
number of shares to be withheld shall be rounded up to the next nearest number
of whole shares. The Participant shall have no further rights with respect to
any Shares that are retained by the Company pursuant to this provision. Under no
circumstances will the Company be required to issue any fractional shares. If,
due to rounding of Shares, the value of the number of Shares retained by the
Company pursuant to this provision is more than the amount required to be
withheld, then the Company may pay such excess amount to the relevant tax
authority as additional withholding with respect to the Participant.
(b) Notwithstanding the provisions of Section 7(a) above, the Compensation
Committee of the Board of Directors of the Company may, in its discretion,
require that the Participant pay to the Company on or prior to the date of the
event creating such withholding obligation an amount in cash adequate to satisfy
the Company's withholding obligations described in Section 7(a) above instead of
through the Company's retention of Shares in the manner provided in Section 7(a)
above. Alternatively, the Compensation Committee of the Board of Directors of
the Company may, in its discretion, elect to sell any such retained Shares for
the account of the Participant in order to generate net proceeds that are
sufficient to satisfy such tax withholding obligations and such proceeds shall
be retained by the Company for such purposes. In the event of such election, the
Participant hereby authorizes and instructs the Company, or its designee, to
effect such sales for his account.
(c) The Participant has reviewed with the Participant's own tax advisors
the federal, state, local and other tax consequences of this investment and the
transactions contemplated herein. The Participant is relying solely on such
advisors and not on any statements or representations of the Company or any of
its agents. The Participant understands that the Participant (and not the
Company) shall be responsible for the Participant's own tax liability that may
arise as a result of this investment or the transactions contemplated herein.
8. Miscellaneous.
(a) No Rights to Employment. The Participant acknowledges and agrees that
the vesting of the Shares pursuant to Section 2 hereof is earned only by
satisfaction of the performance conditions, if any, and continuing service as an
employee at the will of the Company (not through the act of being hired or
engaged or being granted the Shares hereunder). The Participant further
acknowledges and agrees that the transactions contemplated hereunder and the
vesting schedule set forth herein do not constitute an express or implied
promise of continued engagement as an employee or otherwise for the vesting
period, for any period, or at all.
(b) Severability. The invalidity or unenforceability of any of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, and each other provision of this Agreement shall be severable
and enforceable to the extent permitted by law.
(c) Waiver. Any provision for the benefit of the Company contained in this
Agreement may be waived, either generally or in any particular instance, by the
Board of Directors of the Company.
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(d) Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Company and the Participant and their respective heirs,
executors, administrators, legal representatives, successors and assigns,
subject to the restrictions on transfer set forth in Section 3 of these Standard
Terms.
(e) Notice. Each notice relating to this Agreement shall be in writing
(which shall include electronic form) and delivered in person, electronically or
by first class mail, postage prepaid, to the address as hereinafter provided.
Each notice shall be deemed to have been given on the date it is received. Each
notice to the Company shall be addressed to it at its offices at Analog Devices,
Inc., One Technology Way, Norwood, Massachusetts, 02062, Attention: Chief
Financial Officer. Each notice to the Participant shall be addressed to the
Participant at the Participant's last known mailing or email address, as
applicable, on the records of the Company.
(f) Pronouns. Whenever the context may require, any pronouns used in this
Agreement shall include the corresponding masculine, feminine or neuter forms,
and the singular form of nouns and pronouns shall include the plural, and vice
versa.
(g) Entire Agreement. These Standard Terms, the related Confirmation and
the Plan constitute the entire agreement between the parties, and supersede all
prior agreements and understandings, relating to the subject matter of these
documents.
(h) Governing Law. This Agreement shall be construed, interpreted and
enforced in accordance with the internal laws of the Commonwealth of
Massachusetts without regard to any applicable conflicts of laws.
(i) Interpretation. The interpretation and construction of any terms or
conditions of the Plan, or of these Standard Terms, including the related
Confirmation, or other matters related to the Plan by the Compensation Committee
of the Board of Directors of the Company shall be final and conclusive.
(j) Participant's Acknowledgments. The Participant acknowledges that he or
she: (i) has read this Agreement; (ii) has been represented in the preparation,
negotiation, and execution of this Agreement by legal counsel of the
Participant's own choice or has voluntarily declined to seek such counsel; (iii)
understands the terms and consequences of this Agreement; and (iv) is fully
aware of the legal and binding effect of this Agreement.
(k) Delivery of Certificates. The Participant may request that the Company
deliver the Shares in certificated form with respect to any Shares that have
ceased to be subject to forfeiture pursuant to Section 2.
(l) Changes in Capitalization. In the event of any stock split, reverse
stock split, stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in capitalization
or event, or any distribution to holders of Common Stock, any and all new,
substituted or additional securities issued with respect to the Shares shall be
subject to this Agreement in the same manner and to the same extent as the
Shares, and the provisions of this Agreement shall be appropriately adjusted.
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ANALOG DEVICES, INC.
Confirmation of Restricted Stock Grant
Under 2006 Stock Incentive Plan
-------------------------------
Date of Grant:
Name of Participant:
Number of Shares:
Vesting Schedule:
The undersigned Participant hereby accepts and agrees to all of the terms and
conditions set forth in this Confirmation of Restricted Stock Grant and the
Standard Terms and Conditions Relating to Restricted Stock Granted Under the
2006 Stock Incentive Plan, appended hereto (the "Standard Terms").
The undersigned Participant specifically acknowledges the waiver of cash
dividends with respect to the Unvested Shares set forth in Section 4 of the
Standard Terms.
[NOTE: This confirmation may be converted into electronic format and accepted
electronically by the Participant]
PARTICIPANT ANALOG DEVICES, INC.
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(signature) (signature)
EXHIBIT 99.4
FORM OF
RESTRICTED STOCK UNIT CONFIRMING MEMORANDUM
GRANT OF RESTRICTED STOCK UNIT
Private & Confidential (Addressee Only)
Name:
Division:
Location:
We are pleased to advise you that Analog Devices, Inc., a Massachusetts
corporation (the "Company"), has granted to you Restricted Stock Units ("RSUs")
on the terms and conditions set forth below (the "Award"). This Award reflects
the Company's confidence in your commitment and contributions to the success and
continued growth of the Company.
1. Restricted Stock Unit Award.
This memorandum confirms that, subject to the terms and conditions of the
Analog Devices, Inc. 2006 Stock Incentive Plan (the "Plan"), the Company has
granted to you (the "Participant"), effective on the Date of Grant set forth
below, that number of RSUs set forth below:
Date of Grant: xx/xx/xx
Number of RSUs: x,xxx
Vesting Schedule:
Each one (1) RSU shall, if and when it vests in accordance with this Award,
automatically convert into one (1) share of common stock, $0.16 2/3 par value,
of the Company ("Common Stock") issuable as provided below. The RSUs are subject
to the vesting provisions set forth in Section 2, the restrictions on transfer
set forth in Section 3 and the right of the Company to retain Shares (as defined
below) pursuant to Section 7.
2. Vesting and Conversion.
(a) Subject to the terms of the Plan and this Award, the RSUs shall vest in
accordance with the schedule set forth in Section 1. For purposes of this Award,
RSUs that have not vested as of any particular time in accordance with this
Section 2(a), are referred to as "Unvested RSUs." The shares of Common Stock
that are issuable upon the vesting and conversion of the RSUs are referred to in
this Award as "Shares". As soon as administratively practicable after the
issuance of any Shares upon the vesting and conversion of RSUs, and subject to
the terms and conditions set forth herein, the Company shall deliver or cause to
be delivered evidence (which may include a book entry by the Company's transfer
agent) of the Shares so issued in the name of the Participant to the brokerage
firm designated by the Company to maintain the brokerage account established for
the Participant. Notwithstanding the foregoing, the Company shall not be
obligated to issue Shares to or in the name of the Participant upon the vesting
and conversion of any RSUs unless the issuance of such Shares shall comply with
all relevant provisions of law and other legal requirements including, without
limitation, any applicable securities laws and the requirements of any stock
exchange upon which shares of Common Stock may then be listed.
(b) In the event that the Participant's employment with the Company is
terminated either by the Participant or by the Company for any reason or no
reason (other than due to death or disability, each as provided below), then in
each such case, all of the Unvested RSUs as of the date of termination shall
terminate and be cancelled immediately and automatically and the Participant
shall have no further rights with respect to such Unvested RSUs.
(c) In the event that the Participant's employment with the Company is
terminated by reason of the Participant's death, all Unvested RSUs shall vest in
full as of the date of his or her death.
(d) In the event that the Participant's employment with the Company
terminates due to disability (as determined by the Company), the Unvested RSUs
as of the date of his or her disability shall continue to vest in accordance
with the original vesting schedule as if the Participant continued to be
employed by the Company.
(e) For purposes of this Award, employment with the Company shall include
employment with any direct or indirect parent or subsidiary of the Company, or
any successor to the Company or any such parent or subsidiary of the Company.
3. Restrictions on Transfer.
(a) The Participant shall not sell, assign, transfer, pledge or otherwise
encumber any RSUs, either voluntarily or by operation of law, except by will or
the laws of descent and distribution.
(b) The Company shall not be required (i) to transfer on its books any of
the RSUs which have been transferred in violation of any of the provisions set
forth herein or (ii) to treat as the owner of such RSUs any transferee to whom
such RSUs have been transferred in violation of any of the provisions contained
herein.
4. Not a Shareholder.
The RSUs represent an unfunded, unsecured promise by the Company to deliver
Shares upon vesting and conversion of the RSUs, and until vesting of the RSUs
and issuance of the Shares, the Participant shall not have any of the rights of
a shareholder with respect to the Shares underlying the RSUs. For the avoidance
of doubt, the Participant shall have no right to receive any dividends with
respect to the Shares underlying the RSUs for which the record date is on or
before the date on which the Shares underlying the RSUs are issued to the
Participant.
5. Provisions of the Plan.
The RSUs and Shares, including the grant and issuance thereof, are subject
to the provisions of the Plan. A copy of the Plan prospectus and brochure
describing the principal features of the Plan is available on the Company's
Intranet at www.analog.com/employee (from Signals home page, click Knowledge
Centers, Employee Stock Programs. The related documents can be found in the
right-hand column).
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6. Consideration. Any Shares that are issued and any cash payment that is
delivered, in either case upon settlement of the RSUs pursuant to this Award,
will be in consideration of the Participant's entering into employment with the
Company and/or his continued employment with the Company, which consideration is
deemed sufficient.
7. Withholding Taxes.
(a) The Company has the right to deduct from payments of any kind otherwise
due to the Participant any federal, state, local or other taxes of any kind
(including payroll and social security taxes) required by law to be withheld
with respect to the award of the RSUs to the Participant, the vesting of the
RSUs or the issuance of the Shares. Upon the vesting of the RSUs and issuance of
the Shares, the Company may retain that number of whole Shares valued at their
Fair Market Value on the date of the event creating such withholding obligation
(which shall equal the closing price of the Common Stock on the New York Stock
Exchange on such date or, if such date is not a trading date, on the next
following trading date) as is sufficient in the opinion of the Company to
satisfy such tax obligations. In the event the withholding tax obligation would
result in a fractional number of shares to be withheld by the Company, such
number of shares to be withheld shall be rounded up to the next nearest number
of whole shares. The Participant shall have no further rights with respect to
any Shares that are retained by the Company pursuant to this provision. Under no
circumstances will the Company be required to issue any fractional shares. If,
due to rounding of Shares, the value of the number of Shares retained by the
Company pursuant to this provision is more than the amount required to be
withheld, then the Company may pay such excess amount to the relevant tax
authority as additional withholding with respect to the Participant.
(b) Notwithstanding the provisions of Section 7(a) above, the Compensation
Committee of the Board of Directors of the Company may, in its discretion,
require that the Participant pay to the Company on or prior to the date of the
event creating such withholding obligation an amount in cash adequate to satisfy
the Company's withholding obligations described in Section 7(a) above instead of
through the Company's retention of Shares in the manner provided in Section 7(a)
above. Alternatively, the Compensation Committee of the Board of Directors of
the Company may, in its discretion, elect to sell any such retained Shares for
the account of the Participant in order to generate net proceeds that are
sufficient to satisfy such tax withholding obligations and such proceeds shall
be retained by the Company for such purposes. In the event of such election, the
Company, or its designee, is authorized to effect such sales for the
Participant's account.
(c) The Participant is urged to review with the Participant's own legal and
tax advisors the federal, state, local and other tax consequences of this grant
and the transactions contemplated herein. The Participant should rely solely on
such advisors and not on any statements or representations of the Company or any
of its agents. The Participant (and not the Company) shall be responsible for
the Participant's own tax liability that may arise as a result of this grant or
the transactions contemplated herein.
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8. Option of Company to Deliver Cash.
Notwithstanding any of the other provisions of this Award, at the time the
RSUs vest, the Company may elect, in the sole discretion of the Compensation
Committee of the Board of Directors, to deliver by wire transfer to the
Participant in lieu of Shares an equivalent amount of cash (determined by
reference to the closing price of the Common Stock on the New York Stock
Exchange on the applicable vesting date). If the Company elects to deliver cash
to the Participant, the Company is authorized to retain such amount as is
sufficient in the opinion of the Company to satisfy the tax withholding
obligations of the Company.
9. Miscellaneous.
(a) No Rights to Employment. The vesting of the RSUs pursuant to Section 2
hereof is earned only by satisfaction of the performance conditions, if any, and
continuing service as an employee at the will of the Company (not through the
act of being hired or engaged or being granted the RSUs hereunder). The
transactions contemplated hereunder and the vesting schedule set forth herein do
not constitute an express or implied promise of continued engagement as an
employee or otherwise for the vesting period, for any period, or at all.
(b) Severability. The invalidity or unenforceability of any provision of
this Award shall not affect the validity or enforceability of any other
provision of this Award, and each other provision of this Award shall be
severable and enforceable to the extent permitted by law.
(c) Waiver. Any provision for the benefit of the Company contained in this
Award may be waived, either generally or in any particular instance, by the
Compensation Committee of the Board of Directors of the Company.
(d) Binding Effect. This Award shall be binding upon and inure to the
benefit of the Company and the Participant and their respective heirs,
executors, administrators, legal representatives, successors and assigns,
subject to the restrictions on transfer set forth in Section 3 of this Award.
(e) Notice. Each notice relating to this Award shall be in writing (which
shall include electronic form) and delivered in person, electronically or by
first class mail, postage prepaid, to the address as hereinafter provided. Each
notice shall be deemed to have been given on the date it is received. Each
notice to the Company shall be addressed to it at its offices at Analog Devices,
Inc., One Technology Way, Norwood, Massachusetts, 02062, Attention: Chief
Financial Officer. Each notice to the Participant shall be addressed to the
Participant at the Participant's last known mailing or email address, as
applicable, on the records of the Company.
(f) Pronouns. Whenever the context may require, any pronouns used in this
Award shall include the corresponding masculine, feminine or neuter forms, and
the singular form of nouns and pronouns shall include the plural, and vice
versa.
(g) Entire Agreement. This Award and the Plan constitute the entire
understanding between the parties, and supersede all prior agreements and
understandings, relating to the subject matter of these documents.
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(h) Governing Law. This Award shall be construed, interpreted and enforced
in accordance with the internal laws of the Commonwealth of Massachusetts
without regard to any applicable conflicts of laws.
(i) Interpretation. The interpretation and construction of any terms or
conditions of this Award or the Plan, or other matters related to the Plan, by
the Compensation Committee of the Board of Directors of the Company shall be
final and conclusive.
(j) Participant's Acceptance. The Participant is urged to read this Award
carefully and to consult with his or her own legal counsel regarding the terms
and consequences of this Award and the legal and binding effect of this Award.
By virtue of his or her acceptance of this Award, the Participant is deemed to
have accepted and agreed to all of the terms and conditions of this Award and
the provisions of the Plan.
(k) Changes in Capitalization. In the event of any stock split, reverse
stock split, stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in capitalization
or event, or any non-cash distribution to holders of Common Stock, the number of
RSUs, and Shares issuable upon vesting and conversion thereof shall be
appropriately adjusted in such manner as shall be determined by the Compensation
Committee of the Board of Directors of the Company.
(l) Amendment. This Award may be amended or modified only by a written
instrument executed by both the Company and the Participant.
/s/ Ray Stata /s/ Jerald Fishman
- --------------------- ------------------
Ray Stata Jerald Fishman
Chairman of the Board President & CEO
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