exv10w8



 







Exhibit 10.8




LSI LOGIC CORPORATION

EMPLOYEE STOCK PURCHASE PLAN

Amended and Restated




     The following constitutes the provisions of the Employee Stock Purchase Plan (the “Plan”) of
LSI Logic Corporation amended and restated effective March 31, 1999.


1. PURPOSE. The purpose of the Plan is to provide employees of the Company and its Designated
Subsidiaries with an opportunity to purchase Common Stock of the Company through accumulated
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, as amended. 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.




     (a) “Board” means the Board of Directors of the Company, or to the extent
authorized by the Board, a Committee of the Board.



     (b) “Code” means the Internal Revenue Code of 1986, as amended.



     (c) “Common Stock” means the common stock of the Company.



     (d) “Company” means LSI Logic Corporation and any Designated Subsidiary of the Company.



     (e) “Compensation” means all regular and recurring straight time earnings, payments for
overtime, shift premium, incentive compensation, incentive payments, bonuses, commissions, but
exclusive of other compensation.



     (f) “Designated Subsidiary” means any Subsidiary which has been designated by the Board from
time to time in its sole discretion as eligible to participate in the Plan.



     (g) “Employee” means any individual who is an Employee of the Company for tax purposes whose
customary employment with the Company is at least 20 hours per week and more than five months in a
calendar year. For purposes of the Plan, the employment relationship will be treated as continuing
intact while the individual is on sick leave or other leave of absence approved in writing by the
Company. Where the period of leave exceeds 90 days and the individual’s right to reemployment is
not guaranteed either by statute or by contract, the employment relationship shall be deemed to
have terminated on the 91st day of such leave. It shall not include any independent contractors
providing services to the Company or its Subsidiaries, regardless of the length of such service.



     (h) “Enrollment Date” means the first Trading Day of each Offering Period.



     (i) “Exercise Date” means the last Trading Day of each Purchase Period.



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     (j) “Fair Market Value” means, as of any date, the value of the Common Stock determined as
follows:



          (1) If the Common Stock is listed on any established stock exchange or a national market
system, its Fair Market Value shall be the closing sales price for such stock (or the closing bid,
if no sales were reported) as quoted on such exchange or system for the last market trading day on
the date of such determination, as reported by The Wall Street Journal or such other source as the
Board deems reliable;




          (2) If the Common Stock is regularly quoted by a recognized securities dealer but selling
prices are not reported, its Fair Market Value shall be the mean of the closing bid and asked
prices for the Common Stock on the date of such determination, as reported by The Wall Street
Journal or such other source as the Board deems reliable; or




          (3) In the absence of an established market for the Common Stock, the Fair Market Value shall
be determined in good faith by the Board.




     (k) “Offering Periods” means a period of approximately 12 months during which an option
granted pursuant to the Plan may be exercised as further described in Section 4 The duration and
timing of Offering Periods may be changed pursuant to Sections 4 and 20 of this Plan.



     (l) “Plan” means this Amended and Restated Employee Stock Purchase Plan.



     (m) “Purchase Period” means the approximately six-month period commencing after one Exercise
Date and ending with the next Exercise Date, except that the first Purchase Period of any Offering
Period will commence on the Enrollment Date and end with the next Exercise Date.



     (n) “Purchase Price” means 85% of the Fair Market Value of a share of Common Stock on the
Enrollment Date or on the Exercise Date, whichever is lower; provided, however, that with respect
to the Offering Periods commencing on or after January 1, 1999, unless otherwise directed by the
Board, if the Fair Market Value of a share of Common Stock on the date on which additional shares
of Common Stock (the “New Shares”) are authorized for issuance hereunder by the Company’s
stockholders (the “Authorization Date”) is higher than the Fair Market Value of a share of Common
Stock on the Enrollment Date of any outstanding Offering Period that commenced prior to the
Authorization Date, the Purchase Price for only New Shares to be issued on any remaining Exercise
Date of any Offering Period in effect on the Authorization Date shall be 85% of the Fair Market
Value of a share of Common Stock on the Authorization Date or on the Exercise Date, whichever is
lower. The Purchase Price may be adjusted by the Board pursuant to Section 20.



     (o) “Reserves” means the number of shares of Common Stock covered by each option under the
Plan which have not yet been exercised and the number of shares of Common Stock that have been
authorized for issuance under the Plan but not yet placed under option.



     (p) “Subsidiary” means any corporation, domestic or foreign, of which not less than 50% of the
voting shares are held by the Company or a Subsidiary, whether or not such corporation now exists
or is hereafter organized or acquired by the Company or a Subsidiary.



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     (q) “Trading Day” means a day on which national stock exchanges and the Nasdaq System are open
for trading.



3. ELIGIBILITY.




     (a) Any Employee who is employed by the Company on a given Enrollment Date shall be eligible
to participate in the Plan, subject to the requirements of Section 5(a) and the limitations imposed
by Section 423(b) of the Code.



     (b) Any provisions of the Plan to the contrary notwithstanding, no Employee shall be granted
an option under the Plan (i) to the extent that, immediately after the grant, such Employee (or any
other person whose stock ownership would be attributed to such Employee pursuant to Section 424(d)
of the Code) would own capital stock and/or hold outstanding options to purchase shares possessing
five percent or more of the total combined voting power or value of all classes of the capital
stock of the Company or of any Subsidiary, or (ii) to the extent that his or her rights to purchase
stock under all employee stock purchase plans (described in Section 423 of the Code) of the Company
and its Subsidiaries accrue (i.e., become exercisable) at a rate which exceeds $25,000 worth of
stock (determined at the fair market value of the shares at the time such option is granted) for
each calendar year in which such option is outstanding at any time.


4. OFFERING PERIODS. The Plan shall be implemented by consecutive, overlapping Offering Periods
with a new Offering Period commencing on the first Trading Day on or after May 15 and November 15
each year, or on such other date as the Board shall determine, and continuing thereafter until
terminated in accordance with Section 20 hereof, except as set forth in this Section 4. The first
Offering Period of the Plan as amended and restated shall commence with the first Trading Day on or
after May 15, 1999 and end on the last Trading Day on or before May 14, 2000. The Offering Period
which began on October 1, 1998 will end on September 29, 2000 and an Offering Period shall commence
on October 1, 2000 and end on November 14, 2000. The Board shall have the power to change the
duration of Offering Periods (including the commencement dates thereof) with respect to future
offerings without stockholder approval, if such change is announced prior to the scheduled
beginning of the first Offering Period to be affected thereafter.




5. PARTICIPATION.




     (a) An eligible Employee may become a participant in the Plan by completing a subscription
agreement authorizing payroll deductions in the form provided by the Company and filing it with the
Company payroll office prior to the applicable Enrollment Date, unless a later time for filing the
subscription agreement is set for all eligible Employees with respect to such Offering Period.



     (b) Payroll deductions for a participant shall commence with the first payroll following the
Enrollment Date and shall end on the last payroll for the Offering Period to which the subscription
agreement applies, unless sooner terminated by the participant as provided in Section 10.



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6. PAYROLL DEDUCTIONS.




     (a) At the time a participant files his or her subscription agreement, he or she shall elect
to have payroll deductions made on each payday during all subsequent Offering Periods in an amount
not exceeding 15%, or such other rate as may be determined from time to time by the Board,
expressed as a whole percent, of the Compensation which he or she receives on such payday during
said Offering Period and the aggregate of such deduction during the Offering Period shall not
exceed 15%, as applicable in accordance with the foregoing, of the aggregate Compensation during
such Offering Period.



     (b) All payroll deductions authorized by a participant shall be credited to his or her account
under the Plan and shall be withheld in whole percentages only. A participant may not make any
additional payments into such account.



     (c) A participant may discontinue his or her participation in the Plan as provided in Section
10, or may decrease the rate of his or her payroll deductions (but not below 1%) effective
immediately or may increase (but not above 15%) the rate of his payroll deductions effective as of
the first date of the next Purchase Period within such Offering Period by completing and filing
with the Company a new subscription agreement authorizing a change in payroll deduction. The Board
may, in its discretion, limit the number of participation rate changes during any Offering Period.
The change in rate shall be effective as soon as administratively feasible following the Company’s
receipt of the new authorization. A participant’s subscription agreement shall remain in effect
for successive Offering Periods unless terminated as provided in Section 10.



     (d) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of
the Code and Section 3(b) of the Plan, a participant’s payroll deductions may be automatically
decreased to zero percent at any time during a Purchase Period. Payroll deductions shall
recommence at the rate provided in such participant’s subscription agreement at the beginning of
the first Purchase Period which is scheduled to end in the following calendar year, unless
terminated by the participant as provided in Section 10.



     (e) At the time the option is exercised, in whole or in part, or at the time some or all of
the Company’s Common Stock issued under the Plan is disposed of, the participant must make adequate
provision for the Company’s federal, state or other tax withholding obligations, if any, which
arise on the exercise of the option or the disposition of the Common Stock. At any time the
Company may, but shall not be obligated to, withhold from the participant’s compensation the amount
necessary for the Company to meet applicable withholding obligations, including any withholding
required to make available to the Company any tax deductions or benefits attributable to sale or
early disposition of Common Stock by the Employee.


7. GRANT OF OPTION. On each Enrollment Date of each Offering Period, each eligible Employee
participating in such Offering Period shall be granted an option to purchase on each Exercise Date
during such Offering Period (at the applicable Purchase Price) up to a number of full shares of the
Company’s Common Stock determined by dividing such Employee’s payroll deductions accumulated for
that Exercise Date and retained in the Employee’s account as of the Exercise Date by the applicable
Purchase Price; provided that in no event shall an Employee be


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permitted to purchase more than
1,000 shares in each Purchase Period within each Offering Period, provided further that such
purchase shall be subject to the limitations set forth in Sections 3(b) and 13. The Board may, for
future Offering Periods, increase or decrease, in its absolute discretion, the maximum number of
shares of the Company’s Common Stock an Employee may purchase during each Purchase Period of such
Offering Period. Exercise of the option shall occur as provided in Section 8, unless the
participant has withdrawn pursuant to Section 10. The option shall expire on the last day of the
Offering Period.




8. EXERCISE OF OPTION.




     (a) Unless a participant withdraws from the Offering Period as provided in Section 10, his or
her option for the purchase of shares will be exercised automatically on the Exercise Date, and the
maximum number of full shares subject to option will be purchased at the applicable Purchase Price
with the accumulated payroll deductions in his or her account. For this purpose, only payroll
deductions from payroll dates that are more than three business days before an Exercise Date will
be applied to the purchase of shares on that Exercise Date. Payroll deductions from payroll dates
that occur on an Exercise Date or within three business days before an Exercise Date will be
applied to the purchase of shares on the next following Exercise Date. In any event, no fractional
shares will be purchased. Any payroll deductions accumulated in a participant’s account that are
not sufficient to purchase a full share or that exceed the $25,000 cap described in Section 3 above
will be refunded to the participant following the purchase of shares, subject to earlier withdrawal
by the participant as provided in Section 10 or unless the Offering Period has been
over-subscribed, in which event such amount shall be refunded to the participant. During his or
her lifetime, a participant’s option to purchase shares hereunder is exercisable only by the
participant.



     (b) If the Board determines that, on a given Exercise Date, the number of shares with respect
to which options are to be exercised may exceed (i) the number of shares of Common Stock that were
available for sale under the Plan on the Enrollment Date of the applicable Offering Period, or (ii)
the number of shares available for sale under the Plan on such Exercise Date, the Board may in its
sole discretion provide that the Company shall make a pro rata allocation of the shares of Common
Stock available for purchase on such Enrollment Date or Exercise Date, as applicable, in as uniform
a manner as shall be practicable and as it shall determine in its sole discretion to be equitable
among all participants exercising options to purchase Common Stock on such Exercise Date, and (x)
continue all Offering Periods then in effect, or (y) terminate any or all Offering Periods then in
effect pursuant to Section 20. The Company may make pro rata allocation of the shares available on
the Enrollment Date of any applicable Offering Period pursuant to the preceding sentence,
notwithstanding any authorization of additional shares for issuance under the Plan by the Company’s
stockholders subsequent to such Enrollment Date.


9. DELIVERY. As promptly as practicable after each Exercise Date on which a purchase of shares
occurs, the Company shall arrange for the shares purchased upon exercise of his or her option to be
electronically credited to the participant’s brokerage account at the securities brokerage firms
designated by the Company for its direct deposit program from time to time.




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10. WITHDRAWAL; TERMINATION OF EMPLOYMENT.




     (a) A participant may withdraw all, but not less than all, the payroll deductions credited to
his or her account and not yet used to exercise his or her option under the Plan at any time by
giving written notice to the Company on a form provided for such purpose. All of the participant’s
payroll deductions credited to his or her account will be paid to the participant as soon as
practicable after receipt of the notice of withdrawal, his or her option for the current Offering
Period will be automatically canceled, and no further payroll deductions for the purchase of shares
will be made during such Offering Period. If a participant withdraws from an Offering Period,
payroll deductions shall not resume at the beginning of the succeeding Offering Period unless the
participant delivers to the Company a new subscription agreement.



     (b) A participant’s withdrawal from an Offering Period will not have any effect upon his or
her eligibility to participate in a succeeding Offering Period which begins after the end of the
Offering Period from which the participant withdraws or in any similar plan which may hereafter be
adopted by the Company.


11. TERMINATION OF EMPLOYMENT. Upon a participant’s ceasing to be an Employee for any reason,
including retirement or death, he or she will be deemed to have elected to withdraw from the Plan
and the payroll deductions accumulated in his or her account during the Offering Period but not yet
used to exercise the option will be returned to him or her as soon as practicable after such
termination or, in the case of death, to the person or persons entitled thereto under Section 15,
and his or her option will be automatically terminated. The preceding sentence notwithstanding, a
participant who receives payment in lieu of notice of termination of employment shall be treated as
continuing to be an Employee for the participant’s customary number of hours per week of employment
during the period in which the participant is subject to such payment in lieu of notice. In the
case of death of the participant, the payroll deductions credited to the participant’s account will
be paid to the person or persons entitled thereto under paragraph 15, and such participant’s option
will be automatically terminated.



12. INTEREST. No interest shall accrue on the payroll deductions of a participant in the Plan.




13. STOCK.




     (a) Subject to adjustment upon changes in capitalization of the Company as provided in Section
19, the maximum number of shares of the Company’s Common Stock which shall be reserved for sale
under the Plan shall be 78,314,110 shares, plus an annual increase to be added as of the first day
of each fiscal year by an amount equal to (x) 1.15% of the shares of the Company’s Common Stock
issued and outstanding on the last day of the immediately preceding fiscal year less (y) the number
of shares available for future option grants under the Plan on the last
day of the immediately preceding fiscal year, or a lesser amount determined by the Board, but not
to exceed 3,000,000 shares (subject to any adjustment pursuant to Section 19) in any fiscal year.



     (b) The participant will have no interest or voting rights in shares covered by his or her
option until such option has been exercised.



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     (c) Shares to be delivered to a participant under the Plan shall be registered in the name of
the participant or in the name of the participant and his or her spouse.


14. ADMINISTRATION. The Plan shall be administered by the Board or a committee of members of the
Board appointed by the Board. The Board or its committee shall have full and exclusive
discretionary authority to construe, interpret and apply the terms of the Plan, to determine
eligibility and to adjudicate all disputed claims filed under the Plan. Every finding, decision
and determination made by the Board or its committee shall, to the full extent permitted by law, be
final and binding upon all parties.




15. DESIGNATION OF BENEFICIARY.




     (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 or her account. If the
participant is married and the designated beneficiary is not the spouse, spousal consent shall be
required for such designation to be effective.



     (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 reasonably designate.


16. TRANSFERABILITY. Neither payroll deductions credited to a 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 Section 15 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 Section 10.



17. USE OF FUNDS. All payroll deductions received or held by the Company 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.



18. REPORTS. Individual accounts will be maintained for each participant in the Plan. Statements
of account will be given to participating Employees at least annually, and will set forth the
amounts of payroll deductions, the Purchase Price, the number of shares purchased and the remaining
cash balance to be refunded, if any.





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19. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.




     (a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the Reserves, the maximum number of shares each participant may purchase each Purchase
Period (under Section 7), as well as the price per share and the number of shares of Common Stock
covered by each option under the Plan that 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, reverse stock split, stock dividend, combination or reclassification of 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 issuance 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.



     (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Offering Period then in progress will be shortened by setting a new
Exercise Date (the “New Exercise Date”), and shall terminate immediately prior to the consummation
of such proposed dissolution or liquidation, unless otherwise provided by the Board. The New
Exercise Date shall be before the date of the Company’s proposed dissolution or liquidation. The
Company shall notify each participant in writing at least ten business days prior to the New
Exercise Date, that the Exercise Date for the participant’s option has been changed to the New
Exercise Date and that the participant’s option shall be exercised automatically on the New
Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as
provided in Section 10.



     (c) Merger or Asset Sale. In the event of a proposed sale of all or substantially all
of the assets of the Company, or the merger of the Company with or into another corporation, each
option under the Plan shall be assumed or an equivalent option shall be substituted by the
successor corporation or a parent or Subsidiary of the successor corporation. If the successor
corporation refuses to assume or substitute for the option, any Purchase Periods then in progress
shall be shortened by setting a new Exercise Date (the “New Exercise Date”) and any Offering
Periods then in progress shall end on the New Exercise Date. The New Exercise Date shall be before
the date of the Company’s proposed sale or merger. The Company shall notify each participant in
writing prior to the New Exercise Date, that the Exercise Date for the participant’s option has
been changed to the New Exercise Date and that the participant’s option will be exercised
automatically on the New Exercise Date, unless prior to such date the participant has withdrawn
from the Offering Period as provided in Section 10.


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.




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20. AMENDMENT OR TERMINATION.




     (a) The Board of Directors of the Company may at any time and for any reason terminate or
amend the Plan. Except as provided in Section 19, no such termination will affect options
previously granted, provided that an Offering Period may be terminated by the Board on any Exercise
Date if the Board determines that the termination of the Offering Period or the Plan is in the best
interests of the Company and its stockholders. Except as provided in Section 19 and this Section
20, no amendment may make any change in any option theretofore granted which adversely affects the
rights of any participant. To the extent necessary to comply with Section 423 of the Code (or any
successor rule or provision or any other applicable law, regulation or stock exchange rule), the
Company shall obtain stockholder approval in such a manner and to such a degree as required.



     (b) Without stockholder consent and without regard to whether any participant rights may be
considered to have been “adversely affected,” the Board shall be entitled to change the Offering
Periods, limit the frequency and/or number of changes in the amount withheld during an Offering
Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S.
dollars, permit payroll withholding in excess of the amount designated by a participant in order to
adjust for delays or mistakes in the Company’s processing of properly completed withholding
elections, establish reasonable waiting and adjustment periods and/or accounting and crediting
procedures to ensure that amounts applied toward the purchase of Common Stock for each participant
properly correspond with amounts withheld from the participant’s Compensation and establish such
other limitations or procedures as the Board determines in its sole discretion advisable which are
consistent with the Plan.



     (c) In the event the Board determines that the ongoing operation of the Plan may result in
unfavorable financial accounting consequences, the Board may, in its discretion and, to the extent
necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequence
including, but not limited to:



          (i) altering the Purchase Price for any Offering Period including an Offering Period underway
at the time of the change in Purchase Price;




          (ii) shortening any Offering Period so that the Offering Period ends on a new Exercise Date,
including an Offering Period underway at the time of the Board action; and




          (iii) allocating shares.



Such modifications or amendments shall not require stockholder approval or the consent of any Plan
participants.



21. NOTICES. All notices or other communications by a participant to the 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


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receipt thereof. Notices given by means of the Company’s intranet or similar system will be deemed to be written
notices under the Plan.



22. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued with 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, 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 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.



23. TERM OF PLAN. The Plan shall become effective upon the earlier to occur of its adoption by the
Board of Directors of the Company or it is approved by the stockholders. It shall continue in
effect for a term of 10 years unless sooner terminated under Section 20.



24. EMPLOYMENT RELATIONSHIP Nothing in the Plan shall be construed as creating a contract for
employment for any period or shall interfere with or limit in any way the right of the Company or
of any Subsidiary to terminate any participant’s employment relationship at any time, with or
without cause, nor confer upon any participant any right to continue in the employ of the Company
or any Subsidiary.





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