Document:

Exhibit 10.1

                             MODIFICATION AGREEMENT

     BY THIS MODIFICATION AGREEMENT (the "Agreement"),  made and entered into as
of the 31st day of August, 2000, MICROCHIP TECHNOLOGY  INCORPORATED,  a Delaware
corporation,  as Borrower,  BANK ONE,  NA, a national  banking  association,  as
Lender,  LC  Issuer  and  Administrative   Agent,  WELLS  FARGO  BANK,  National
Association,  as Lender and Syndication Agent, Bank of America,  N.A., as Lender
and  Documentation  Agent,  BANCA DI ROMA,  as  Lender  and THE  NORTHERN  TRUST
COMPANY,  as Lender,  in  consideration of the mutual covenants herein contained
and other good and valuable consideration,  the receipt and sufficiency of which
is hereby acknowledged, hereby confirm and agree as follows:

     SECTION 1. RECITALS.

     SECTION 1.1. Borrower and Bank One, NA, a national banking association,  as
Lender,  LC  Issuer  and  Administrative   Agent,  Wells  Fargo  Bank,  National
Association,  as Lender and Syndication Agent, Bank of America,  N.A., as Lender
and  Documentation  Agent,  Banca Di Roma,  as  Lender  and The  Northern  Trust
Company,  as Lender,  entered into a Credit  Agreement  dated as of May 31, 2000
(the "Credit  Agreement"),  which provided for, among other things,  one or more
Loans in the aggregate principal amount of $100,000,000.00,  evidenced by one or
more   promissory   notes  dated  May  31,   2000,   executed  by  the  Borrower
(collectively,  the  "Notes"),  all  upon the  terms  and  conditions  contained
therein.  All  undefined  capitalized  terms used herein  shall have the meaning
given them in the Credit Agreement.

     SECTION 1.2. Borrower, LC Issuer,  Administrative Agent, Syndication Agent,
Documentation Agent and Lenders desire to modify the Loan Documents as set forth
herein.

     SECTION 2. LOAN AGREEMENT.

     SECTION 2.1.  Section 6.10 of the Credit Agreement is hereby amended by the
addition of the following subsection (iv):

          (iv) Indebtedness evidenced by the issuance by Borrower of convertible
     subordinated notes in principal amount not to exceed  $250,000,000.00 (plus
     an additional 15% principal amount if any note  purchaser's  over-allotment
     option is exercised in full) in the  aggregate,  pursuant to  subordination
     terms and conditions reasonably acceptable to the Administrative Agent.

     SECTION 2.2.  Section 6.16 of the Credit Agreement is hereby amended by the
addition of the  following  provision  to the end of sentence  set forth in such
Section:

          , except any purchase, redemption, retirement or acquisition made with
     respect to (i) principal of, or interest on, any Subordinated  Indebtedness
     at the  scheduled  maturity date for such payment of principal or interest,
<PAGE>
     (ii) any Subordinated Indebtedness in junior securities upon the conversion
     of such Subordinated  Indebtedness that is convertible at the option of the
     holder  thereof  (together  with payments of cash in lieu of any fractional
     share in connection with any such  conversion),  or (iii) any  Subordinated
     Indebtedness in exchange for the net proceeds of any concurrent offering of
     junior  securities.  For  purposes of this Section  6.16,  the term "junior
     securities"  means (A) shares of any stock of any class of  Borrower or (B)
     debt  securities of Borrower that are  subordinated  in right of payment to
     the Obligations to substantially the same extent as, or to a greater extent
     than, the Subordinated Indebtedness being purchased,  redeemed,  retired or
     acquired.

SECTION 3. OTHER MODIFICATIONS, RATIFICATIONS AND AGREEMENTS.

     SECTION 3.1. All  references to the Credit  Agreement in the Loan Documents
are hereby amended to refer to the Credit Agreement as hereby amended.

     SECTION 3.2. Borrower  acknowledges that the indebtedness  evidenced by the
Notes is just and owing,  that the  balance  thereof is  correctly  shown in the
records  of  Lenders  as of the date  hereof,  and  Borrower  agrees  to pay the
indebtedness  evidenced by the Notes  according to the terms thereof,  as herein
modified.

     SECTION   3.3.   Borrower   hereby   reaffirms   to  Lenders  each  of  the
representations,  warranties,  covenants and agreements of Borrower set forth in
the Notes and the  Credit  Agreement,  with the same force and effect as if each
were separately stated herein and made as of the date hereof.

     SECTION 3.4. Borrower hereby ratifies, reaffirms,  acknowledges, and agrees
that the  Notes and the  Credit  Agreement,  represent  valid,  enforceable  and
collectible  obligations  of  Borrower,  and that there are no existing  claims,
defenses,  personal or otherwise, or rights of setoff whatsoever with respect to
any of these documents or instruments.  In addition,  Borrower hereby  expressly
waives,  releases and absolutely and forever  discharges Lenders and its present
and former shareholders,  directors,  officers,  employees and agents, and their
separate and respective heirs, personal representatives, successors and assigns,
from any and all liabilities,  claims,  demands,  damages,  action and causes of
action,  of which Borrower has, or may reasonably be expected to have knowledge,
that  Borrower may now have,  or has had prior to the date  hereof,  or that may
hereafter arise with respect to acts, omissions or events occurring prior to the
date hereof and, without limiting the generality of the foregoing,  from any and
all liabilities,  claims, demands,  damages, actions and causes of action, known
or unknown, contingent or matured, arising out of, or in any way connected with,
the  Loans.  Borrower  further  acknowledges  and  represents  that no event has
occurred and no condition  exists that,  after notice or lapse of time, or both,
would  constitute  a default  under  this  Agreement,  the  Notes or the  Credit
Agreement.

                                       -2-
<PAGE>
     SECTION  3.5. All terms,  conditions  and  provisions  of the Notes and the
Credit  Agreement  are  continued  in full  force and  effect  and shall  remain
unaffected and unchanged  except as specifically  amended hereby.  The Notes and
the Credit Agreement,  as amended hereby,  are hereby ratified and reaffirmed by
Borrower, and Borrower specifically acknowledges the validity and enforceability
thereof.

SECTION 4. GENERAL.

     SECTION 4.1. This  Agreement in no way acts as a release or  relinquishment
of those rights securing payment of the Loans.  Such rights are hereby ratified,
confirmed, renewed and extended by Borrower in all respects.

     SECTION 4.2. The  modifications  contained herein shall not be binding upon
Lenders until Lenders shall have received all of the following:

          (a) An original of this Agreement fully executed by the Borrower.

          (b) Such  resolutions or  authorizations  and such other  documents as
     Lenders may reasonably  require relating to the existence and good standing
     of the  Borrower  and each  Material  Subsidiary  and the  authority of any
     person  executing  this  Agreement  or other  documents  on  behalf  of the
     Borrower.

     SECTION 4.3.  Borrower shall execute and deliver such additional  documents
and do such other acts as Lenders may reasonably  require to fully implement the
intent of this Agreement.

     SECTION 4.4. Borrower shall pay all costs and expenses,  including, but not
limited  to,  reasonable  attorneys'  fees  incurred  by Lenders  in  connection
herewith,  whether or not all of the conditions described in Paragraph 4.2 above
are satisfied.  Lenders,  at their option,  but without any obligation to do so,
may advance funds to pay any such costs and expenses that are the  obligation of
the  Borrower,  and all such funds  advanced  shall bear interest at the highest
rate provided in the Notes and shall be due and payable upon demand.

     SECTION 4.5.  Notwithstanding  anything to the contrary contained herein or
in any other instrument  executed by Borrower or Lenders, or in any other action
or conduct  undertaken by Borrower or Lenders on or before the date hereof,  the
agreements,  covenants and provisions contained herein shall constitute the only
evidence of Lenders'  consent to modify the terms and  provisions  of the Credit
Agreement.   Accordingly,   no  express  or  implied   consent  to  any  further
modifications  involving  any of the  matters  set  forth in this  Agreement  or
otherwise shall be inferred or implied by Lenders'  execution of this Agreement.
Further,  Lenders'  execution of this  Agreement  shall not  constitute a waiver
(either express or implied) of the requirement that any further  modification of
the Loans or of the Notes or the Credit  Agreement,  shall  require  the express
written  approval of Lenders;  no such approval  (either express or implied) has
been given as of the date hereof.

                                       -3-
<PAGE>
     SECTION  4.6.  Time is hereby  declared to be of the essence  hereof of the
Loans,  of the Notes and of the  Credit  Agreement,  and  Lenders  require,  and
Borrower agrees to, strict  performance of each and every  covenant,  condition,
provision and agreement hereof, of the Notes and the Credit Agreement.

     SECTION 4.7. This  Agreement  shall be binding upon, and shall inure to the
benefit  of, the  parties  hereto  and their  heirs,  personal  representatives,
successors and assigns.

     SECTION 4.8. This Agreement is made for the sole  protection and benefit of
the parties hereto, and no other person or entity shall have any right of action
hereon.

     SECTION 4.9. This Agreement shall be governed by and construed according to
the laws of the State of Arizona.

     IN WITNESS  WHEREOF,  these  presents are executed as of the date indicated
above.

                                        MICROCHIP TECHNOLOGY INCORPORATED

                                        By: /s/ Gordon Parnell
                                            ------------------------------------
                                            Name: Gordon Parnell
                                            ------------------------------------
                                            Its:  Vice President & CFO
                                            ------------------------------------

                                                                        BORROWER

                                        BANK ONE, NA,
                                        Individually, as LC Issuer and as
                                        Administrative Agent

                                        By: /s/ Joseph Perdenza
                                            ------------------------------------
                                            Title: Assistant Vice President

                                        By: /s/ Stephanie A. Mack
                                            ------------------------------------
                                            Title: Commercial Banking Officer

                                        By: /s/ Peterine M. Svoboda
                                            ------------------------------------
                                            Title: Vice President

                                       -4-
<PAGE>
                                        WELLS FARGO BANK, NATIONAL ASSOCIATION,

                                        Individually and as Syndication Agent

                                        By: /s/ Brenda K. Testerman
                                            ------------------------------------
                                            Title: Vice President

                                        BANK OF AMERICA, N.A.,
                                        Individually and as Documentation Agent

                                        By: /s/ S. Manchanda
                                            ------------------------------------
                                            Title: Vice President

                                        BANCA DI ROMA

                                        By: /s/ Richard G. Dietz
                                            ------------------------------------
                                            Title: Vice President

                                        By: /s/ Thomas C. Woodruff
                                            ------------------------------------
                                            Title: Vice President

                                        THE NORTHERN TRUST COMPANY

                                        By: /s/ Candelario Martinez
                                            ------------------------------------
                                            Title: Vice President

                                       -5-Exhibit 10.2

                   RESTATED MICROCHIP TECHNOLOGY INCORPORATED
                          EMPLOYEE STOCK PURCHASE PLAN

                       AS AMENDED THROUGH AUGUST 18, 2000

     I.   PURPOSE

          The Microchip  Technology  Incorporated  Employee  Stock Purchase Plan
(the "Plan") is intended to provide eligible employees of the Company and one or
more of its Corporate  Affiliates  with the opportunity to acquire a proprietary
interest in the Company through  participation  in a plan designed to qualify as
an employee stock purchase plan under Section 423 of the Code.

     II.  DEFINITIONS

          For purposes of  administration of the Plan, the following terms shall
have the meanings indicated:

          BOARD means the Board of Directors of the Company.

          CODE means the Internal  Revenue Code of 1986, as amended from time to
time.

          COMPANY   means   Microchip   Technology   Incorporated,   a  Delaware
corporation,  and any  corporate  successor to all or  substantially  all of the
assets or voting  stock of  Microchip  Technology  Incorporated  which  shall by
appropriate action adopt the Plan.

          COMMON STOCK means shares of the  Company's  common  stock,  par value
$0.001 per share.

          CORPORATE AFFILIATE means any parent or subsidiary  corporation of the
Company  (as   determined  in  accordance   with  Code  Section  424)  which  is
incorporated   in  the  United  States,   including  any  parent  or  subsidiary
corporation which becomes such after the Effective Date.

          EARNINGS means the sum of the following items of compensation  paid to
a Participant by one or more  Participating  Companies during such  individual's
period of  participation  in the Plan:  (i) regular base  salary,  plus (ii) any
pre-tax  contributions made by the Participant to any Code Section 401(k) salary
deferral plan or any Code Section 125 cafeteria benefit program now or hereafter
established  by the Company or any Corporate  Affiliate  plus (iii) all overtime
payments,   bonuses,   commissions,   profit-sharing   distributions  and  other
incentive-type  payments. There shall, however, be excluded from the calculation
of such Earnings any and all  contributions  (other than Code Section  401(k) or
Code Section 125 contributions) made on the Participant's  behalf by the Company
or one or more Corporate  Affiliates  under any employee benefit or welfare plan
now or hereafter established.
<PAGE>
          EFFECTIVE  DATE  means  March 17,  1993,  the start  date of the first
offering  period under the Plan.  However,  for any  Corporate  Affiliate  which
becomes a  Participating  Company  in the Plan after  such  date,  a  subsequent
Effective Date shall be designated with respect to participation by its Eligible
Employees.

          ELIGIBLE   EMPLOYEE   means  any   person   who  is   engaged,   on  a
regularly-scheduled  basis of more than twenty (20) hours per week for more than
five (5) months per calendar year, in the rendition of personal  services to the
Company or any other  Participating  Company for earnings considered wages under
Section 3121(a) of the Code.

          ENTRY  DATE  means  the date an  Eligible  Employee  first  joins  the
offering period in effect under the Plan. The earliest Entry Date under the Plan
shall be the Effective Date.

          FAIR MARKET  VALUE means the fair market  value of the Common Stock on
any relevant date under the Plan and shall,  for any date  following the initial
March 17, 1993  Effective  Date,  be deemed to be equal to the  closing  selling
price per share of Common Stock on the date in question, as officially quoted on
the Nasdaq National Market.  If there is no quoted selling price for the date in
question,  then the closing  selling price per share of Common Stock on the next
preceding day for which there does exist such a quotation shall be determinative
of Fair Market Value.

          PARTICIPANT means any Eligible Employee of a Participating Company who
is actively participating in the Plan.

          PARTICIPATING  COMPANY means the Company and such Corporate  Affiliate
or Affiliates as may be designated  from time to time by the Board to extend the
benefits of the Plan to their Eligible Employees.

          SEMI-ANNUAL  ENTRY DATE means the first business day of each March and
September  within an  offering  period in effect  under the Plan.  However,  the
earliest  Semi-Annual  Entry  Date  under the Plan  shall be the March 17,  1993
Effective Date.

          SEMI-ANNUAL PERIOD OF PARTICIPATION  means each semi-annual period for
which the  Participant  actually  participates  in an offering  period in effect
under the Plan.  There  shall be a maximum  of four (4)  semi-annual  periods of
participation within each offering period. Except as otherwise designated by the
Plan  Administrator,  the first such  semi-annual  period (which may actually be
less than six (6) months for the initial  offering period) shall extend from the
start date of the  offering  period  through  the last  business  day in August;
subsequent  semi-annual  periods shall then be measured from the first  business
day of September  and March  thereafter to the last business day of February and
August, respectively.

          SEMI-ANNUAL PURCHASE DATE means the last business day of each February
and  August  within  an  offering  period on which  shares  of Common  Stock are
automatically purchased for Participants under the Plan.

                                        2
<PAGE>
          SERVICE means the period during which an individual  performs services
as an Eligible Employee and shall be measured from his or her hire date, whether
that date is before or after the Effective Date of the Plan.

     III. ADMINISTRATION

          The  Plan   shall  be   administered   by  a   committee   (the  "Plan
Administrator")  comprised  of  two  (2)  or  more  non-employee  Board  members
appointed from time to time by the Board. The Plan Administrator shall have full
authority to administer the Plan,  including authority to interpret and construe
any  provision  of  the  Plan  and to  adopt  such  rules  and  regulations  for
administering  the Plan as it may deem  necessary  in order to  comply  with the
requirements  of Section 423 of the Code.  Decisions  of the Plan  Administrator
shall be final and binding on all parties who have an interest in the Plan.

     IV.  OFFERING PERIODS

          A. Shares of Common Stock shall be offered for purchase under the Plan
through a series  of  successive  offering  periods  until  such time as (i) the
maximum  number of shares of Common Stock  available for issuance under the Plan
shall have been purchased or (ii) the Plan shall have been sooner  terminated in
accordance with Article IX.

          B. The Plan shall be  implemented  in a series of successive  offering
periods,  each  to be of a  duration  of  twenty-four  (24)  months  or  less as
designated  by the Plan  Administrator  prior to the  start  date.  The  initial
offering  period  will  begin  on the  Effective  Date  and will end on the last
business day in February  1995.  The next offering  period shall commence on the
first business day in March 1995, and subsequent offering periods shall commence
as designated by the Plan Administrator.

          C. Under no circumstances shall any offering period commence under the
Plan, nor shall any shares of Common Stock be issued hereunder,  until such time
as (i) the Plan shall have been approved by the Company's  stockholders and (ii)
the  Company  shall  have  complied  with  all  applicable  requirements  of the
Securities Act of 1933 (as amended),  all applicable listing requirements of any
securities exchange on which shares of the Common Stock are listed and all other
applicable statutory and regulatory requirements.

          D. The Participant shall be granted a separate purchase right for each
offering  period in which  he/she  participates.  The  purchase  right  shall be
granted on the Entry  Date on which such  individual  first  joins the  offering
period  in  effect  under  the Plan  and  shall be  automatically  exercised  in
successive  semi-annual  installments  on the last business day of each February
and August  within the  remainder  of the  offering  period.  Accordingly,  each
purchase  right may be  exercised  up to two (2)  times  each  calendar  year it
remains outstanding.

          E. The acquisition of Common Stock through plan  participation for any
offering  period shall neither limit nor require the acquisition of Common Stock
by the Participant in any subsequent offering period.

                                        3
<PAGE>
     V.   ELIGIBILITY AND PARTICIPATION

          A. Each Eligible Employee of a Participating Company shall be eligible
to participate in the Plan in accordance with the following provisions:

          -    An  individual  who is an Eligible  Employee with at least thirty
               (30)  days of  Service  prior to the start  date of the  offering
               period may enter that offering  period on the  Semi-Annual  Entry
               Date  coincident  with  such  start  date  or on  any  subsequent
               Semi-Annual  Entry  Date  within  that  offering  period on which
               he/she remains an Eligible  Employee.  The Semi-Annual Entry Date
               on which such  individual  first joins the offering  period shall
               become such individual's  Entry Date for the offering period, and
               on that date such individual  shall be granted  his/her  purchase
               right for the offering period.

          -    An  individual  who is not an  Eligible  Employee  with at  least
               thirty  (30) days of Service  on the start  date of the  offering
               period may  subsequently  enter that offering period on the first
               Semi-Annual  Entry Date on which  he/she is an Eligible  Employee
               with  thirty  (30) or more days of Service  or on any  subsequent
               Semi-Annual  Entry  Date  within  that  offering  period on which
               he/she remains an Eligible  Employee.  The Semi-Annual Entry Date
               on which such  individual  first joins the offering  period shall
               become such individual's Entry Date for that offering period, and
               on that date such individual  shall be granted  his/her  purchase
               right for the offering period.

          B. To  participate  for a  particular  offering  period,  the Eligible
Employee must complete the enrollment forms prescribed by the Plan Administrator
(including a purchase agreement and a payroll deduction  authorization) and file
such forms with the Plan  Administrator  (or its designate) on or before his/her
scheduled Entry Date.

          C. The payroll deduction authorized by the Participant for purposes of
acquiring  shares of Common  Stock  under  the Plan may be any  multiple  of one
percent (1%) of the Earnings  paid to the  Participant  during each  Semi-Annual
Period of  Participation  within  the  offering  period,  up to a maximum of ten
percent (10%). The deduction rate so authorized shall continue in effect for the
remainder of the offering  period,  except to the extent such rate is changed in
accordance with the following guidelines:

          -    The Participant  may, at any time during a Semi-Annual  Period of
               Participation,  reduce  his/her rate of payroll  deduction.  Such
               reduction  shall become  effective as soon as possible  after the
               filing   of  the   requisite   reduction   form   with  the  Plan
               Administrator  (or its  designate),  but the  Participant may not
               effect  more  than  one  (1)  such  reduction   during  the  same
               Semi-Annual Period of Participation.

          -    The  Participant  may  not  increase   his/her  rate  of  payroll
               deduction  following his/her Entry Date into the offering period.
               However,  the  Participant  may, prior to his/her Entry Date into
               any new offering  period,  increase  the rate of his/her  payroll
               deduction   by  filing  the   appropriate   form  with  the  Plan

                                        4
<PAGE>
               Administrator  (or its  designate).  The new rate  (which may not
               exceed the ten percent (10%) maximum)  shall become  effective as
               of the  Participant's  Entry Date into the first offering  period
               following the filing of such form.

          Payroll  deductions will  automatically  cease upon the termination of
the  Participant's  purchase right in accordance  with the provisions of Section
VII below.

     VI.  STOCK SUBJECT TO PLAN

          A. The Common Stock  purchasable  under the Plan shall,  solely in the
discretion of the Plan  Administrator,  be made available from either authorized
but unissued shares of Common Stock or from shares of Common Stock reacquired by
the Company,  including shares of Common Stock purchased on the open market. The
total  number of shares  which may be issued over the term of the Plan shall not
exceed  5,759,000  shares  (subject to  adjustment  under  Section  VI.B below).
However,  not more than  2,285,000  shares may be issued under the Plan from and
after March 1, 1995, subject to adjustment under Section VI.B below.

          B. In the event any change is made to the outstanding  Common Stock by
reason of any stock dividend, stock split, combination of shares or other change
affecting such outstanding Common Stock as a class without the Company's receipt
of   consideration,   appropriate   adjustments   shall  be  made  by  the  Plan
Administrator  to (i) the class and maximum  number of securities  issuable over
the term of the Plan and from and after the March 1, 1995 effective date of this
restatement,  (ii) the class and maximum  number of securities  purchasable  per
Participant during any one (1) Semi-Annual Period of Participation and (iii) the
class and  number of  securities  and the price per share in effect  under  each
purchase right at the time outstanding under the Plan. Such adjustments shall be
designed to preclude the dilution or  enlargement  of rights and benefits  under
the Plan.

     VII. PURCHASE RIGHTS

          An Eligible  Employee  who  participates  in the Plan for a particular
offering  period shall have the right to purchase  shares of Common Stock,  in a
series of successive semi-annual  installments during such offering period, upon
the terms and conditions set forth below and shall execute a purchase  agreement
embodying such terms and conditions (not inconsistent with the Plan) as the Plan
Administrator may deem advisable.

          PURCHASE  PRICE.  Common  Stock  shall be  issuable at the end of each
Semi-Annual  Period of  Participation  within the offering  period at a purchase
price  equal to  eighty-five  percent  (85%) of the LOWER of (i) the Fair Market
Value per share on the  Participant's  Entry Date into that  offering  period or
(ii) the Fair Market Value per share on the  Semi-Annual  Purchase Date on which
such Semi-Annual  Period of Participation  ends.  However,  for each Participant
whose Entry Date is other than the start date of the offering period, the clause
(i) amount  shall in no event be less than the Fair  Market  Value of the Common
Stock on the start date of that offering period.

                                        5
<PAGE>
          PAYMENT.  Payment for the Common Stock  purchased under the Plan shall
be effected by means of the Participant's  authorized payroll  deductions.  Such
deductions  shall begin with the first full  payroll  period  beginning  with or
immediately  following the Participant's Entry Date into the offering period and
shall (unless sooner terminated by the Participant) continue through the pay day
ending with or  immediately  prior to the last day of the offering  period.  The
amounts so collected shall be credited to the  Participant's  book account under
the  Plan,  but no  interest  shall  be paid on the  balance  from  time to time
outstanding in such account.  The amounts  collected  from a Participant  may be
commingled  with the  general  assets of the Company and may be used for general
corporate purposes.

          NUMBER OF PURCHASABLE  SHARES.  The number of shares  purchasable  per
Participant for each  Semi-Annual  Period of  Participation  during the offering
period  shall be the number of whole  shares  obtained by  dividing  the payroll
deductions  collected from the  Participant  during that  Semi-Annual  Period of
Participation  by the  purchase  price in effect  for the  Participant  for such
period.  No Participant  may purchase more than Twenty  Thousand Two Hundred and
Fifty (20,250) shares of Common Stock per Semi-Annual  Period of  Participation,
subject to periodic adjustment under Section VI.B.

          Under no circumstances shall purchase rights be granted under the Plan
to any Eligible Employee if such individual would,  immediately after the grant,
own (within the meaning of Code Section 424(d)) or hold  outstanding  options or
other  rights to  purchase,  stock  possessing  five percent (5%) or more of the
total  combined  voting power or value of all classes of stock of the Company or
any of its Corporate Affiliates.

          TERMINATION OF PURCHASE RIGHT.  The following  provisions shall govern
the termination of outstanding purchase rights:

          (i)   A Participant  may,  at any  time  prior  to the  last  five (5)
                business days  of  the  Semi-Annual   Period  of  Participation,
                terminate his/her  outstanding  purchase right under the Plan by
                filing  the   prescribed   notification   form   with  the  Plan
                Administrator (or its designate).  No further payroll deductions
                shall be collected  from the  Participant  with  respect  to the
                terminated purchase right, and any payroll deductions  collected
                for the  Semi-Annual  Period  of  Participation  in  which  such
                termination occurs  shall,  at the  Participant's  election,  be
                immediately refunded  or held for the  purchase of shares on the
                next Semi-Annual  Purchase  Date. If no such election is made at
                the time the purchase  right is  terminated, then the deductions
                collected with respect to the terminated right shall be refunded
                as soon as possible.

          (ii)  The termination of such purchase right shall be irrevocable, and
                the Participant may not subsequently  rejoin the offering period
                for which the terminated purchase right was granted. In order to
                resume participation  in any subsequent  offering  period,  such
                individual must re-enroll in the Plan (by making a timely filing
                of a new purchase agreement and payroll deduction authorization)
                on or before his/her scheduled  Entry Date into the new offering
                period.

                                        6
<PAGE>
          (iii) If the Participant  ceases to remain an Eligible  Employee while
                his/her purchase right remains  outstanding,  then such purchase
                right shall immediately  terminate,  and the payroll  deductions
                collected from such Participant  for the  Semi-Annual  Period of
                Participation in which the purchase right so terminates shall be
                promptly refunded to the Participant.  However, in the event the
                Participant's cessation of Eligible  Employee  status  occurs by
                reason of  his/her  death or  permanent  disability,  then  such
                individual (or the  personal  representative  of the estate of a
                deceased  Participant)   shall  have  the  following   election,
                exercisable at any time prior to the last five (5) business days
                of the  Semi-Annual   Period  of  Participation  in  which  such
                cessation of Eligible Employee status occurs:

                    -    to withdraw all of the Participant's payroll deductions
                         for such Semi-Annual Period of Participation, or

                    -    to have such funds held for the  purchase  of shares on
                         the  Semi-Annual  Purchase Date  immediately  following
                         such cessation of Eligible Employee status.

          If a timely election is not made, then the payroll deductions shall be
refunded  as soon as  possible  after  the close of such  Semi-Annual  Period of
Participation.  In no event,  however, may any payroll deductions be made on the
Participant's behalf following his/her cessation of Eligible Employee status.

          STOCK  PURCHASE.   Shares  of  Common  Stock  shall  automatically  be
purchased on behalf of each Participant  (other than Participants  whose payroll
deductions  have  previously been refunded in accordance with the Termination of
Purchase Right provisions above) on each Semi-Annual Purchase Date. The purchase
shall be effected by applying  each  Participant's  payroll  deductions  for the
Semi-Annual  Period of Participation  ending on such  Semi-Annual  Purchase Date
(together with any carryover deductions from the preceding Semi-Annual Period of
Participation)  to the purchase of whole shares of Common Stock  (subject to the
limitation on the maximum number of  purchasable  shares set forth above) at the
purchase  price in effect for the  Participant  for such  Semi-Annual  Period of
Participation.  Any payroll deductions not applied to such purchase because they
are not  sufficient  to purchase a whole share shall be held for the purchase of
Common  Stock in the next  Semi-Annual  Period of  Participation.  However,  any
payroll  deductions not applied to the purchase of Common Stock by reason of the
limitation on the maximum number of shares purchasable by the Participant during
the  Semi-Annual  Period of  Participation  shall be  promptly  refunded  to the
Participant.

          PRORATION  OF PURCHASE  RIGHTS.  Should the total  number of shares of
Common Stock which are to be purchased  pursuant to outstanding  purchase rights
on any  particular  date exceed the number of shares then available for issuance
under the Plan, the Plan Administrator  shall make a pro-rata  allocation of the
available  shares on a uniform  and  nondiscriminatory  basis,  and the  payroll
deductions  of each  Participant,  to the  extent  in  excess  of the  aggregate
purchase price payable for the Common Stock pro-rated to such individual,  shall
be refunded to such Participant.

                                        7
<PAGE>
          RIGHTS AS STOCKHOLDER.  A Participant shall have no stockholder rights
with respect to the shares subject to his/her  outstanding  purchase right until
the shares are actually purchased on the Participant's behalf in accordance with
the  applicable  provisions  of the  Plan.  No  adjustments  shall  be made  for
dividends,  distributions  or other rights for which the record date is prior to
the date of such purchase.

          A  Participant  shall be entitled to receive,  as soon as  practicable
after each  Semi-Annual  Purchase  Date, a stock  certificate  for the number of
shares  purchased on the  Participant's  behalf.  Such certificate may, upon the
Participant's  request,  be issued in the names of the  Participant  and his/her
spouse as community  property or as joint  tenants  with right of  survivorship.
Alternatively,  the Participant may request the issuance of such  certificate in
"street name" for immediate deposit in a designated brokerage account.

          ASSIGNABILITY.  No  purchase  right  granted  under the Plan  shall be
assignable or transferable by the Participant  other than by will or by the laws
of descent and distribution  following the  Participant's  death, and during the
Participant's  lifetime  the  purchase  right shall be  exercisable  only by the
Participant.

          CHANGE IN  OWNERSHIP.  Should  any of the  following  transactions  (a
"Change in Ownership") occur during the offering period:

          (i)   a  merger  or other reorganization in which the Company will not
                be  the  surviving  corporation  (other  than  a  reorganization
                effected  primarily  to change the State in which the Company is
                incorporated), or

          (ii)  a sale of all or substantially  all of the  Company's  assets in
                liquidation or dissolution of the Company, or

          (iii) a reverse   merger  in  which  the  Company  is  the   surviving
                corporation but in which  more than fifty  percent  (50%) of the
                Company's outstanding  voting stock is  transferred to person or
                persons  different  from  those  who  held the stock immediately
                prior to such merger, or

          then  all   outstanding   purchase   rights   under  the  Plan   shall
automatically  be  exercised  immediately  prior to the  effective  date of such
Change in Ownership by applying the payroll  deductions of each  Participant for
the Semi-Annual Period of Participation in which such Change in Ownership occurs
to the purchase of whole shares of Common Stock at eighty-five  percent (85%) of
the  LOWER  of (i) the Fair  Market  Value  per  share  of  Common  Stock on the
Participant's  Entry  Date  into the  offering  period in which  such  Change in
Ownership  occurs  or (ii) the Fair  Market  Value  per  share of  Common  Stock
immediately  prior to the effective  date of such Change in Ownership.  However,
the  applicable  share  limitations  of Articles VII and VIII shall  continue to
apply to any such  purchase,  and the clause (i) amount above shall not, for any
Participant  whose  Entry Date for the  offering  period is other than the start
date of that  offering  period,  be less than the Fair Market Value per share of
Common Stock on such start date.

                                        8
<PAGE>
          The  Company  shall  use its best  efforts  to  provide  at least  ten
(10)-days  advance  written  notice  of the  occurrence  of any such  Change  in
Ownership,  and Participants  shall,  following the receipt of such notice, have
the right to terminate their outstanding  purchase rights in accordance with the
applicable provisions of this Article VII.

     VIII. ACCRUAL LIMITATIONS

          A. No Participant shall be entitled to accrue rights to acquire Common
Stock pursuant to any purchase right  outstanding  under this Plan if and to the
extent such accrual,  when  aggregated  with (I) rights to purchase Common Stock
accrued  under any other  purchase  right  outstanding  under this Plan and (II)
similar  rights  accrued under other  employee  stock purchase plans (within the
meaning of Section 423 of the Code) of the Company or its Corporate  Affiliates,
would otherwise  permit such  Participant to purchase more than $25,000 worth of
stock of the Company or any Corporate Affiliate  (determined on the basis of the
value  of  such  stock  on the  date  or  dates  such  rights  are  granted  the
Participant) for each calendar year such rights are at any time outstanding.

          B. For  purposes of applying  such accrual  limitations,  the right to
acquire Common Stock pursuant to each purchase right  outstanding under the Plan
shall accrue as follows:

          (i)   The right to acquire Common Stock under each such purchase right
                shall accrue in a series of successive semi-annual  installments
                as  and  when  the  purchase right first becomes exercisable for
                each   such  installment  on  the  last  business  day  of  each
                Semi-Annual  Period of Participation for which the right remains
                outstanding.

          (ii)  No right to acquire Common Stock under an  outstanding  purchase
                right shall  accrue to the extent the  Participant  has  already
                accrued in the same calendar  year the right to  acquire  Common
                Stock  under one or more  other  purchase  rights at the rate of
                Twenty-Five Thousand  Dollars  ($25,000)  worth of Common  Stock
                (determined on the basis of the Fair Market Value on the date or
                dates  such rights are  granted)  for each  calendar  year those
                rights are at any time outstanding.

          (iii) If by reason of such accrual limitations,  any purchase right of
                a  Participant  does  not  accrue  for  a particular Semi-Annual
                Period of Participation, then the payroll deductions  which  the
                Participant made during that Semi-Annual Period of Participation
                with respect to such purchase right shall be promptly refunded.

          C. In the event there is any conflict  between the  provisions of this
Article VIII and one or more  provisions  of the Plan or any  instrument  issued
thereunder,  the  provisions  of this  Article  VIII shall be  controlling.

                                        9
<PAGE>
     IX.  AMENDMENT AND TERMINATION

          A. The  Board  may  alter,  amend,  suspend  or  discontinue  the Plan
following the close of any Semi-Annual  Period of  Participation.  However,  the
Board may not, without the approval of the Company's stockholders:

          (i)   materially increase the number of shares issuable under the Plan
                or the maximum  number of  shares  purchasable  per  Participant
                during any one Semi-Annual Period of Participation,  except that
                the Plan  Administrator shall  have the  authority,  exercisable
                without such stockholder approval,  to effect adjustments to the
                extent necessary  to reflect  changes in the  Company's  capital
                structure pursuant to Section VI.B;

          (ii)  alter the  purchase  price  formula so as to reduce the purchase
                price payable for the shares issuable under the Plan; or

          (iii) materially increase the benefits accruing to Participants  under
                the  Plan  or materially modify the requirements for eligibility
                to participate in the Plan.

          B.  The  Company  shall  have  the  right,  exercisable  in  the  sole
discretion  of the Plan  Administrator,  to terminate all  outstanding  purchase
rights under the Plan immediately  following the close of any Semi-Annual Period
of Participation. Should the Company elect to exercise such right, then the Plan
shall terminate in its entirety.  No further purchase rights shall thereafter be
granted or exercised,  and no further  payroll  deductions  shall  thereafter be
collected, under the Plan.

     X.   DISPOSITION OF SHARES

          A. The Plan Administrator may, in its absolute discretion,  impose, as
a condition to the issuance of the shares of Common  Stock  purchased  under the
Plan,  the  requirement  that each  Participant  provide the Company with prompt
notice of any  transfer or other  disposition  of those shares which is effected
within two (2) years after  Participant's Entry Date into the offering period in
which the  shares  were  purchased  OR  within  one year  after the  Semi-Annual
Purchase  Date  on  which  those  shares  were  in  fact  purchased.   The  Plan
Administrator  may further require the certificate  evidencing such shares to be
endorsed with a legend  indicating the existence of such notice  requirement and
impose  appropriate stop transfer orders with respect to such certificate in the
absence of such notice.

          B. The Company shall not record on its books of record any transfer or
other  disposition  of the shares of Common Stock issued under the Plan which is
not effected in compliance with the foregoing notice requirement.  Moreover, the
Company  may impose,  as a  condition  to the  recordation  of such  transfer or
disposition, the requirement that the Participant satisfy all Federal, state and
local income and  employment  tax  withholding  obligations  applicable  to such
transfer or disposition.

                                       10
<PAGE>
     XI.  GENERAL PROVISIONS

          A. The Plan became effective on the March 17, 1993 Effective Date.

          B. The March 1, 1995  restatement  incorporated a series of amendments
to the Plan  authorized  by the Board in January,  1995 to effect the  following
changes to the Plan: (i) allow Eligible  Employees to join an offering period on
any  Semi-Annual   Entry  Date  within  that  offering  period,   (ii)  prohibit
Participants  from  increasing  their rate of payroll  deduction  under the Plan
after  their  Entry  Date into a  particular  offering  period,  (iii)  obligate
Participants to notify the Company of any disqualifying  disposition (as defined
in Code  Section  423) of the shares  they  acquire  under the Plan and (iv) and
increase in the number of shares of Common Stock available for issuance over the
term of the Plan.

          C. The Plan shall  terminate upon the EARLIER of (i) the last business
day in  February  2013(1)  or (ii) the date on which all  shares  available  for
issuance  under the Plan  shall  have  been sold  pursuant  to  purchase  rights
exercised under the Plan.

          D. All costs and expenses  incurred in the  administration of the Plan
shall be paid by the Company.

          E. Neither the action of the Company in establishing the Plan, nor any
action  taken  under  the Plan by the Board or the Plan  Administrator,  nor any
provision  of the Plan itself  shall be  construed so as to grant any person the
right to remain in the employ of the Company or any of its Corporate  Affiliates
for any  period  of  specific  duration,  and such  person's  employment  may be
terminated at any time, with or without cause.

          F. The  provisions  of the Plan shall be  governed  by the laws of the
State of Arizona without resort to that State's conflict-of-laws rules.

----------
(1)  On August 18, 2000, the  stockholders  approved an amendment to the Plan to
     extend the term of the Plan from the last  business day in February 2003 to
     the last business day in February 2013.

                                       11
<PAGE>
                                   SCHEDULE A

                           COMPANIES PARTICIPATING IN
                          EMPLOYEE STOCK PURCHASE PLAN
                              AS OF AUGUST 18, 2000

                        Microchip Technology Incorporated

                                       12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00017-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00017-of-00352.parquet"}]]