Exhibit 10.9

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AVID TECHNOLOGY, INC.

 

SECOND AMENDED AND RESTATED

1996 EMPLOYEE STOCK PURCHASE PLAN

 

The purpose of this Second Amended and Restated 1996 Employee Stock Purchase
Plan (the "Plan") is to provide eligible employees of Avid Technology, Inc. (the
"Company") and certain of its subsidiaries with opportunities to purchase shares
of the Company's common stock, $0.01 par value per share (the "Common Stock"),
commencing on August 1, 1996. An aggregate of Two Million Five Hundred Thousand
(2,500,000) shares of Common Stock have been approved for this purpose. This
Plan is intended to qualify as an "employee stock purchase plan" as defined in
Section 423 of the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder (the "Code"), and shall be interpreted
consistent therewith.

 

1.        Administration. The Plan will be administered by the Company's Board
of Directors (the "Board") or by a Committee appointed by the Board (the
"Committee"). The Board or the Committee has authority to make rules and
regulations for the administration of the Plan and its interpretation and
decisions with regard thereto shall be final and conclusive.

 

2.        Eligibility. Participation in the Plan will neither be permitted nor
denied contrary to the requirements of Section 423 of the Code. All employees of
the Company, including members of the Board who are employees, and all employees
of any subsidiary of the Company (as defined in Section 424(f) of the Code)
unless the Board or the Committee specifies otherwise (each subsidiary
participating in the Plan is referred to herein as a "Participating
Subsidiary"), are eligible to participate in any one or more of the offerings of
Options (as defined in Section 9) to purchase Common Stock under the Plan
provided that:

 

(a)       they are regularly employed by the Company or a Participating
Subsidiary for more than twenty (20) hours per week and for more than five (5)
months in a calendar year; and

 

(b)       they have been employed by the Company or a Participating Subsidiary
for at least two (2) weeks prior to enrolling in the Plan; and

 

(c)       they are employees of the Company or a Participating Subsidiary on the
first day of the applicable Plan Period (as defined below).

 

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No employee may be granted an Option hereunder if such employee, immediately
after the Option is granted, would own five percent (5%) or more of the total
combined voting power or value of the stock of the Company or any subsidiary.
For purposes of the preceding sentence, the attribution rules of Section 424(d)
of the Code shall apply in determining the stock ownership of an employee, and
all stock which the employee has a contractual right to purchase shall be
treated as stock owned by the employee.

 

3.        Offerings. The Company will make offerings ("Offerings") to employees
to purchase Common Stock under this Plan. Offerings will begin each February 1,
May 1, August 1 and November 1, or the first business day thereafter (the
"Offering Commencement Dates"). Each Offering Commencement Date will begin a
three (3) month period (a "Plan Period") during which payroll deductions will be
made and held for the purchase of Common Stock at the end of the Plan Period.
The Board or the Committee may, at its discretion, choose a different Plan
Period of twelve (12) months or fewer.

 

4.        Participation. An employee eligible on the Offering Commencement Date
of any Offering may participate in such Offering by completing and forwarding a
payroll deduction authorization form to the employee's appropriate payroll
office at least seven (7) days prior to the applicable Offering Commencement
Date. The form will authorize a regular payroll deduction from the Compensation
(as defined below) received by the employee during the Plan Period. Unless an
employee files a new form or withdraws from the Plan, his or her deductions and
purchases will continue at the same rate for future Offerings under the Plan as
long as the Plan remains in effect. The term "Compensation" means the amount of
money reportable on the employee's Federal Income Tax Withholding Statement,
excluding overtime, shift premium, incentive or bonus awards, allowances and
reimbursements for expenses such as relocation allowances for travel expenses,
income or gains on the exercise of Company stock options or stock appreciation
rights, and similar items, whether or not shown on the employee's Federal Income
Tax Withholding Statement, but including, in the case of salespersons, sales
commissions to the extent determined by the Board or the Committee.

 

5.        Deductions. The Company will maintain payroll deduction accounts for
all participating employees. With respect to any Offering made under this Plan,
an employee may authorize a payroll deduction in any dollar amount up to a
maximum of ten percent (10%) of the Compensation he or she receives during the
Plan Period or such shorter period during which deductions from payroll are
made. However, the maximum contribution during any Plan Period cannot exceed
$2,500. The Board or the Committee may set a minimum payroll deduction
requirement.

 

6.        Deduction Changes. An employee may discontinue his or her payroll
deduction once during any Plan Period, by filing a new payroll deduction
authorization form. However, an employee may not decrease or increase his or her
payroll deduction during a Plan Period. If an employee elects to discontinue his
or her payroll deductions during a Plan Period, but does not elect to withdraw
his or her funds pursuant to Section 8 hereof, funds deducted prior to his or
her election to discontinue will be applied to the purchase of Common Stock on
the Exercise Date (as defined in Section 9).

 

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7.        Interest. Interest will not be paid on any employee accounts, except
to the extent that the Board or the Committee, in its sole discretion, elects to
credit employee accounts with interest at such per annum rate as it may from
time to time determine.

 

8.        Withdrawal of Funds. An employee may at any time prior to the close of
business on the date fourteen (14) days prior to the last business day in the
then current Plan Period and for any reason permanently draw out the balance
accumulated in the employee's account and thereby withdraw from participation in
an Offering. Partial withdrawals are not permitted. The employee may not begin
participation again during the remainder of the Plan Period. The employee may
participate in any subsequent Offering in accordance with terms and conditions
established by the Board or the Committee.

 

9.        Purchase of Shares. On the Offering Commencement Date of each Plan
Period, the Company will grant to each eligible employee who is then a
participant in the Plan an option ("Option") to purchase on the last business
day of such Plan Period (the "Exercise Date") at the applicable Option Price (as
defined below) the largest number of whole shares of Common Stock resulting from
the employee’s accumulated payroll deductions as of the Exercise Date divided by
the Option Price for such Plan Period; provided, however, that no employee may
be granted an Option which permits his or her rights to purchase Common Stock
under this Plan and any other employee stock purchase plan (as defined in
Section 423(b) of the Code) of the Company and its subsidiaries, to accrue at a
rate which exceeds $25,000 of the fair market value of such Common Stock for
each calendar year in which the Option is outstanding at any time.

 

The purchase price for each share purchased will be 85% of the closing price of
the Common Stock on the Exercise Date (the "Option Price"). Such closing price
shall be (a) the closing price on the NASDAQ Global Select Market or other
national securities exchange on which the Common Stock is listed, or (b) the
average of the closing bid and asked prices in the over-the-counter market,
whichever is applicable. If no sales of Common Stock were made on such a day,
the price of the Common Stock for purposes of clause (a) above shall be the
reported price for the next preceding day on which sales were made.

 

Each employee who continues to be a participant in the Plan on the Exercise Date
shall be deemed to have exercised his or her Option at the Option Price on such
date and shall be deemed to have purchased from the Company the number of whole
shares of Common Stock reserved for the purpose of the Plan that his or her
accumulated payroll deductions on such date will pay for (but not in excess of
the maximum number determined in the manner set forth above).

 

Any balance remaining in an employee's payroll deduction account at the end of a
Plan Period will be automatically refunded to the employee, except that any
balance which is less than the purchase price of one share of Common Stock will
be carried forward into the employee's payroll deduction account for the
following Offering, unless the employee elects not to participate in the
following Offering under the Plan, in which case the balance in the employee's
account shall be refunded.

 

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10.      Holding Period. Any shares of Common Stock issued to a participating
employee pursuant to this Plan may not be sold, assigned, pledged, encumbered or
otherwise transferred by such employee for a period of three (3) months after
the applicable Exercise Date. By exercising an Option, the employee shall be
deemed to have agreed to these restrictions on the transferability of such
shares.

 

11.      Issuance of Shares. Promptly following the end of each Offering, the
number of shares of Common Stock purchased under the Plan shall, subject to the
holding period requirement set forth above, be deposited into an account
established in the name of the employee at a stock brokerage or other financial
services firm designated by the Company (the "ESPP Broker").

 

The employee may direct, by written notice to the Company at the time during his
or her enrollment in the Plan, that his or her ESPP broker account be
established in the name of the employee and another person of legal age as joint
tenants with rights of survivorship or (in the Company’s sole discretion) in the
street name of a brokerage firm, bank or other nominee holder designated by the
employee.

 

12.      Rights on Retirement, Death or Termination of Employment. In the event
of a participating employee's termination of employment prior to the last
business day of a Plan Period, no payroll deduction shall be taken from any pay
due and owing to an employee following the effective date of such termination.
The balance in the employee's account shall be paid to the employee or, in the
event of the employee's death, (a) to a beneficiary previously designated in a
revocable notice signed by the employee (with any spousal consent required under
state law), (b) in the absence of such a designated beneficiary, to the executor
or administrator of the employee's estate, or (c) if no such executor or
administrator has been appointed to the knowledge of the Company, to such other
person(s) as the Company may, in its discretion, designate. If, prior to the
last business day of the Plan Period, the Participating Subsidiary by which an
employee is employed shall cease to be a subsidiary of the Company, or if the
employee is transferred to a subsidiary of the Company that is not a
Participating Subsidiary, the employee shall be deemed to have terminated
employment for the purposes of this Plan.

 

13.      Optionees Not Stockholders. Neither the granting of an Option to an
employee nor the deductions from his or her pay shall constitute such employee a
stockholder of the shares of Common Stock covered by an Option under this Plan
until such shares have been purchased by and issued to him or her.

 

14.      Rights Not Transferable. Rights under this Plan are not transferable by
a participating employee other than by will or the laws of descent and
distribution, and are exercisable during the employee's lifetime only by the
employee.

 

15.      Application of Funds. All funds received or held by the Company under
this Plan may be combined with other corporate funds and may be used for any
corporate purpose.

 

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16.      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 other than an ordinary
cash dividend, (i) the number and class of securities available under this Plan,
(ii) the share limitations set forth in Section 9, and (iii) the Option Price
shall be appropriately adjusted to the extent determined by the Board or the
Committee.

 

17.      Reorganization Events. A “Reorganization Event” shall mean: (a) any
merger or consolidation of the Company with or into another entity as a result
of which all of the Common Stock of the Company is converted into or exchanged
for the right to receive cash, securities or other property or is cancelled, (b)
any exchange of all of the Common Stock of the Company for cash, securities or
other property pursuant to a share exchange transaction or (c) any liquidation
or dissolution of the Company.

 

In connection with a Reorganization Event, the Board or the Committee shall take
any one or more of the following actions as to outstanding Options on such terms
as the Board or the Committee determines: (i) provide that Options shall be
assumed, or substantially equivalent Options shall be substituted, by the
acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written
notice to employees, provide that all outstanding Options will be terminated as
of the effective date of the Reorganization Event and that all such outstanding
Options will become exercisable to the extent of accumulated payroll deductions
as of a date specified by the Board or the Committee in such notice, which date
shall not be less than ten (10) days preceding the effective date of the
Reorganization Event, (iii) upon written notice to employees, provide that all
outstanding Options will be cancelled as of a date prior to the effective date
of the Reorganization Event and that all accumulated payroll deductions will be
returned to participating employees on such date, (iv) in the event of a
Reorganization Event under the terms of which holders of Common Stock will
receive upon consummation thereof a cash payment for each share surrendered in
the Reorganization Event (the “Acquisition Price”), make or provide for a cash
payment to an employee equal to (A) the Acquisition Price times the number of
shares of Common Stock subject to the employee’s Option (to the extent the
Option Price does not exceed the Acquisition Price) minus (B) the aggregate
Option Price of such Option, in exchange for the termination of such Option, (v)
provide that, in connection with a liquidation or dissolution of the Company,
Options shall convert into the right to receive liquidation proceeds (net of the
Option Price thereof) and (vi) any combination of the foregoing.

 

For purposes of clause (i) above, an Option shall be considered assumed if,
following consummation of the Reorganization Event, the Option confers the right
to purchase, for each share of Common Stock subject to the Option immediately
prior to the consummation of the Reorganization Event, the consideration
(whether cash, securities or other property) received as a result of the
Reorganization Event by holders of Common Stock for each share of Common Stock
held immediately prior to the consummation of the Reorganization Event (and if
holders were offered a choice of consideration, the type of consideration chosen
by the holders of a majority of the outstanding shares of Common Stock);
provided, however, that if the consideration received as a result of the
Reorganization Event is not solely common stock of the acquiring or succeeding
corporation (or an affiliate thereof), the Company may, with the consent of the
acquiring or

 

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succeeding corporation, provide for the consideration to be received upon the
exercise of Options to consist solely of common stock of the acquiring or
succeeding corporation (or an affiliate thereof) equivalent in value (as
determined by the Board) to the per share consideration received by holders of
outstanding shares of Common Stock as a result of the Reorganization Event.

 

18.      Amendment of the Plan. The Board may at any time, and from time to
time, amend this Plan in any respect, except that (a) if the approval of any
such amendment by the shareholders of the Company is required by Section 423 of
the Code, such amendment shall not be effected without such approval, and (b) in
no event may any amendment be made which would cause the Plan to fail to comply
with Section 423 of the Code.

 

19.      Insufficient Shares. In the event that the total number of shares of
Common Stock specified in elections to be purchased under any Offering plus the
number of shares purchased under previous Offerings under this Plan exceeds the
maximum number of shares issuable under this Plan, the Board or the Committee
will allot the shares then available on a pro rata basis.

 

20.      Termination of the Plan. This Plan may be terminated at any time by the
Board. Upon termination of this Plan all amounts in the accounts of
participating employees shall be promptly refunded.

 

21.      Governmental Regulations. The Company's obligation to sell and deliver
Common Stock under this Plan is subject to the listing requirements of the
NASDAQ Global Select Market or other applicable national stock exchange and the
approval of all governmental authorities required in connection with the
authorization, issuance or sale of such stock. The Plan shall be governed by
Delaware law except to the extent that such law is preempted by federal law.

 

22.      Issuance of Shares. Shares may be issued upon exercise of an Option
from authorized but unissued Common Stock, from shares of Common Stock held in
the treasury of the Company, or from any other proper source.

 

23.      Notification upon Sale of Shares. Each employee agrees, by enrolling in
the Plan, to promptly give the Company notice of any disposition of shares
purchased under the Plan where such disposition occurs within two years after
the date of grant of the Option pursuant to which such shares were purchased.

 

24.      Effective Date and Approval of Shareholders. The Company's 1996
Employee Stock Purchase Plan took effect on February 12, 1996 subject to
approval by the stockholders of the Company as required by Section 423 of the
Code, which approval was obtained on June 5, 1996. This Second Amended and
Restated 1996 Employee Stock Purchase shall be effective on May 1, 2008, subject
to the number of authorized shares of Common Stock (1,700,000) previously
approved by the Company's stockholders until such date as the greater number of
authorized shares set forth in the introductory paragraph of this Plan
(2,500,000) shall be approved by the stockholders of the Company as required by
Section 423 of the Code. The Company shall submit the increase in the number of
authorized shares under the Plan for stockholder approval at the Company's 2008
Annual Meeting of Stockholders on May 21, 2008.

 

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AVID TECHNOLOGY, INC.

 

Amendment No. 1 to the Avid Technology, Inc. Second Amended and Restated 1996
Employee Stock Purchase Plan  

 

That Section 2(a) of the Avid Technology, Inc. Second Amended and Restated 1996
Employee Stock Purchase Plan is hereby deleted in its entirety.

 

Approved by the Board of Directors of Avid Technology, Inc. on August 12, 2008

 

 

 

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