GARMIN
LTD.
EMPLOYEE
STOCK PURCHASE PLAN
Amended
and Restated
Effective
January 1, 2008
TABLE
OF CONTENTS
|
|
Page
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I.
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Purpose
and Effective Date
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2
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II.
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Definitions
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2
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III.
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Administration
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4
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IV.
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Number
of Shares
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5
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V.
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Eligibility
Requirements
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6
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VI.
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Enrollment
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6
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VII.
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Grant
of Options on Enrollment
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7
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VIII.
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Payroll
Deductions
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7
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IX.
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Purchase
of Shares
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8
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X.
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Withdrawal
From the Plan; Termination of Employment; Leave of Absence;
Death
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10
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XI.
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Miscellaneous
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11
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GARMIN
LTD.
EMPLOYEE
STOCK PURCHASE PLAN
I. Purpose
and Effective Date
1.1 The
purpose of the Garmin Ltd. Employee Stock Purchase Plan is to provide an
opportunity for eligible employees to acquire a proprietary interest in Garmin
Ltd. through accumulated payroll deductions. It is the intent of the Company
to
have the Plan qualify as an "employee stock purchase plan" under Section 423
of
the Code. The provisions of the Plan shall be construed to extend and limit
participation in a manner consistent with the requirements of Section 423 of
the
Code.
1.2 The
Plan
shall be effective on the Effective Date stated below, subject to the approval
of the Company’s stockholders within one year before or one year after the date
the Plan is approved by the Board of Directors of the Company. No option shall
be granted under the Plan after the date as of which the Plan is terminated
by
the Board in accordance with Section 11.7 of the Plan.
II. Definitions
The
following words and phrases, when used in this Plan, unless their context
clearly indicates otherwise, shall have the following respective
meanings:
2.1 "Account"
means a
recordkeeping account maintained for a Participant to which payroll deductions
are credited in accordance with Article VIII of the Plan.
2.2 "Administrator"
means
the persons or committee appointed under Section 3.1 to administer the
Plan.
2.3 "Article"
means
an Article of this Plan.
2.4 "Accumulation
Period"
means,
as to the Company or a Participating Subsidiary, a period of six months
commencing with the first regular payroll period commencing on or after each
successive January 1 and ending on each successive June 30 and a period of
six
months commencing with the first regular payroll period commencing on or after
each successive July 1 and ending on each successive December 31. The Committee
may modify (including increasing or decreasing the length of time covered)
or
suspend Accumulation Periods at anytime and from time to time.
2.5 "Base
Earnings"
means
base salary and wages payable by the Company or a Participating Subsidiary
to an
Eligible Employee, prior to pre-tax deductions for contributions to qualified
or
non-qualified (under the Code) benefit plans or arrangements, and excluding
bonuses, incentives and overtime pay but including commissions.
2.6 "Board"
means
the Board of Directors of the Company.
2.7 "Code"
means
the Internal Revenue Code of 1986, as amended.
2.8 "Company"
means
Garmin Ltd., a Cayman Islands corporation.
2.9 "Cut-Off
Date"
means
the date established by the Administrator from time to time by which enrollment
forms must be received with respect to an Accumulation Period.
2.10 "Eligible
Employee"
means
an Employee, including an employee on an Authorized Leave of Absence (as defined
in Section 10.3), eligible to participate in the Plan in accordance with Article
V.
2.11 "Employee"
means
an individual who performs services for the Company or a Participating
Subsidiary pursuant to an employment relationship described in Treasury
Regulations Section 31.3401(c)-1 or any successor provision, or an individual
who would be performing such services but for such individual’s Authorized Leave
of Absence (as defined in Section 10.3).
2.12 "Enrollment
Date"
means
the first Trading Day of an Accumulation Period beginning on or after January
1,
2008.
2.13 "Exchange
Act"
means
the Securities Exchange Act of 1934.
2.14 "Fair
Market Value"
means,
as of any applicable date:
(a)
If
the security is listed on any established stock exchange or traded on the
Nasdaq
Global Select Market or the Nasdaq Global Market (formerly the Nasdaq National
Market), the closing price, regular way, of the security on such exchange,
or if
no such reported sale of the security shall have occurred on such date, on
the
latest preceding date on which there was such a reported sale, in all cases,
as
reported in The
Wall Street Journal
or such
other source as the Board deems reliable.
(b)
If
the security is listed or traded on the Nasdaq Capital Market (formerly the
Nasdaq SmallCap Market), the mean between the bid and asked prices for the
security on the date of determination, as reported in The Wall Street Journal
or
such other source as the Board deems reliable. Unless otherwise provided
by the
Board, if there is no closing sales price (or closing bid if no sales were
reported) for the security on the date of determination, then the Fair Market
Value shall be the mean between the bid and asked prices for the security
on the
last preceding date for which such quotation exists.
(c) In
the
absence of such markets for the security, the value determined by the Board
in
good faith.
2.15 "Participant"
means
an Eligible Employee who has enrolled in the Plan pursuant to Article VI. A
Participant shall remain a Participant until the applicable date set forth
in
Article X.
2.16 "Participating
Subsidiary"
means a
Subsidiary incorporated under the laws of any state in the United States, a
territory of the United States, Puerto Rico, or the District of Columbia, or
such foreign Subsidiary approved under Section 3.3, which has adopted the Plan
as a Participating Subsidiary by action of its board of directors and which
has
been designated by the Board in accordance with Section 3.3 as covered by the
Plan, subject to the requirements of Section 423 of the Code except as noted
in
Section 3.3.
2.17 "Plan"
means
the Garmin Ltd. Employee Stock Purchase Plan as set forth herein and as from
time to time amended.
2.18 "Purchase
Date"
means
the specific Trading Day during an Accumulation Period on which Shares are
purchased under the Plan in accordance with Article IX. For each Accumulation
Period, the Purchase Date shall be the last Trading Day occurring in such
Accumulation Period. The Administrator may, in its discretion, designate a
different Purchase Date with respect to any Accumulation Period.
2.19 "Qualified
Military Leave”
means
an absence due to service in the uniformed services of the United States (as
defined in Chapter 43 of Title 38 of the United States Code) by an individual
employee of the Company or a Participating Subsidiary, provided the individual’s
rights to reemployment under the Uniformed Services Employment and Reemployment
Rights Act of 1994 have not expired or terminated.
2.20 "Section"
means a
section of this Plan, unless indicated otherwise.
2.21 "Securities
Act"
means
the Securities Act of 1933, as amended.
2.22 "Share"
means a
common share, $.01 par value, of Garmin Ltd.
2.23 "Subsidiary"
means
any corporation in an unbroken chain of corporations beginning with the Company
if, as of the applicable Enrollment Date, each of the corporations other than
the last corporation in the chain owns stock possessing 50% or more of the
total
combined voting power of all classes of stock in one of the other corporations
in the chain.
2.24 "Trading
Day"
means a
day the national exchange on which the Shares are listed for trading or, if
not
so listed, a day the New York Stock Exchange is open for trading.
III. Administration
3.1 Subject
to Section 11.7, the Plan shall be administered by the Board, or committee
("Committee") appointed by the Board. The Committee shall consist of at least
one Board member, but may additionally consist of individuals who are not
members of the Board. The Committee shall serve at the pleasure of the Board.
If
the Board does not so appoint a Committee, the Board shall administer the Plan.
Any references herein to "Administrator" are, except as the context requires
otherwise, references to the Board or the Committee, as applicable.
3.2 If
appointed under Section 3.1, the Committee may select one of its members as
chairman and may appoint a secretary. The Committee shall make such rules and
regulations for the conduct of its business as it shall deem advisable;
provided, however, that all determinations of the Committee shall be made by
a
majority of its members.
3.3 The
Administrator shall have the power, in addition to the powers set forth
elsewhere in the Plan, and subject to and within the limits of the express
provisions of the Plan, to construe and interpret the Plan and options granted
under it; to establish, amend and revoke rules and regulations for
administration of the Plan; to determine all questions of policy and expediency
that may arise in the administration of the Plan; to allocate and delegate
such
of its powers as it deems desirable to facilitate the administration and
operation of the Plan; and, generally, to exercise such powers and perform
such
acts as it deems necessary or expedient to promote the best interests of the
Company. The Administrator's determinations as to the interpretation and
operation of this Plan shall be final and conclusive.
The
Board
may designate from time to time which Subsidiaries of the Company shall be
Participating Subsidiaries. Without amending the Plan, the Board may adopt
special or different rules for the operation of the Plan which allow employees
of any foreign Subsidiary to participate in the purposes of the Plan. In
furtherance of such purposes, the Board may approve such modifications,
procedures, rules or sub-plans as it deems necessary or desirable, including
those deemed necessary or desirable to comply with any foreign laws or to
realize tax benefits under foreign law. Any such different or special rules
for
employees of any foreign Subsidiary shall not be subject to Code Section 423
and
for purposes of the Code shall be treated as separate and apart from the balance
of the Plan.
3.4 This
Article III relating to the administration of the Plan may be amended by the
Board from time to time as may be desirable to satisfy any requirements of
or
under the federal securities and/or other applicable laws of the United States,
or to obtain any exemption under such laws.
IV. Number
of Shares
4.1 Two
million (2,000,000) Shares (reflecting the Company's 2-for-1 stock split on
August 15, 2006) are reserved for sales and authorized for issuance pursuant
to
the Plan. Shares sold under the Plan may be newly-issued Shares, outstanding
Shares reacquired in private transactions or open market purchases, or any
combination of the foregoing. If any option granted under the Plan shall for
any
reason terminate without having been exercised, the Shares not purchased under
such option shall again become available for the Plan.
4.2 In
the
event of any reorganization, recapitalization, stock split, reverse stock split,
stock dividend, combination of shares, merger, consolidation, acquisition of
property or shares, separation, asset spin-off, stock rights offering,
liquidation or other similar change in the capital structure of the Company,
the
Board shall make such adjustment, if any, as it deems appropriate in the number,
kind and purchase price of the Shares available for purchase under the Plan.
In
the event that, at a time when options are outstanding hereunder, there occurs
a
dissolution or liquidation of the Company, except pursuant to a transaction
to
which Section 424(a) of the Code applies, each option to purchase Shares shall
terminate, but the Participant holding such option shall have the right to
exercise his or her option prior to such termination of the option upon the
dissolution or liquidation. The Company reserves the right to reduce the number
of Shares which Employees may purchase pursuant to their enrollment in the
Plan.
V. Eligibility
Requirements
5.1 Except
as
provided in Section 5.2, each individual who is an Eligible Employee of the
Company or a Participating Subsidiary on the applicable Cut-Off Date shall
become eligible to participate in the Plan in accordance with Article VI as
of
the first Enrollment Date following the date the individual becomes an Employee
of the Company or a Participating Subsidiary, provided that the individual
remains an Eligible Employee on the first day of the Accumulation Period
associated with such Enrollment Date. Participation in the Plan is entirely
voluntary.
5.2 Employees
meeting any of the following restrictions are not eligible to participate in
the
Plan:
(a) Employees
who, immediately upon enrollment in the Plan or upon grant of an Option would
own directly or indirectly, or hold options or rights to acquire, an aggregate
of 5% or more of the total combined voting power or value of all outstanding
shares of all classes of stock of the Company or any Subsidiary (and for
purposes of this paragraph, the rules of Code Section 424(d) shall apply, and
stock which the Employee may purchase under outstanding options shall be treated
as stock owned by the Employee);
(b) Employees
(other than individuals on Authorized Leave of Absence (as defined in Section
10.3)) who are customarily employed by the Company or a Participating Subsidiary
for not more than 20 hours per week; or
(c) Employees
(other than individuals on Authorized Leave of Absence (as defined in Section
10.3)) who are customarily employed by the Company or a Participating Subsidiary
for not more than five (5) months in any calendar year.
5.3 The
Plan
is intended to conform to the extent necessary with all provisions of the
Securities Act and the Exchange Act and any and all regulations and rules
promulgated by the Securities and Exchange Commission thereunder.
Notwithstanding anything herein to the contrary, the Plan shall be administered,
and the options shall be granted and may be exercised, only in such a manner
as
to conform to such laws, rules and regulations. To the extent permitted by
applicable law, the Plan and the options granted hereunder shall be deemed
amended to the extent necessary to conform to such laws, rules and regulations.
VI. Enrollment
6.1 Eligible
Employees will be automatically enrolled in the Plan on the first day of each
Accumulation Period. Any Eligible Employee may consent to enrollment in the
Plan
for an Accumulation Period by completing and signing an enrollment form (which
authorizes payroll deductions during such Accumulation Period in accordance
with
Section 8.1) and submitting such enrollment form to the Company or the
Participating Subsidiary on or before the Cut-Off Date specified by the
Administrator. Payroll deductions pursuant to the enrollment form shall be
effective as of the first payroll period with a pay day after the Enrollment
Date for the Accumulation Period to which the enrollment form relates, and
shall
continue in effect until the earliest of:
(a) the
end
of the last payroll period with a payday in the Accumulation
Period;
(b) the
date
during the Accumulation Period as of which the Employee elects to cease his
or
her enrollment in accordance with Section 8.3; and
(c) the
date
during the Accumulation Period as of which the Employee withdraws from the
Plan
or has a termination of employment in accordance with Article X.
Notwithstanding
anything in the Plan to the contrary, for the initial Accumulation Period the
Administrator may upon notice to Eligible Employees give effect to payroll
deductions as of a payroll period with a pay date after the Cut-Off Date for
the
Accumulation Period, with such deductions effective as to all or a portion
of
Base Earnings either payable or earned on or after the Effective Date.
VII. Grant
of Options on Enrollment
7.1 The
automatic enrollment by an Eligible Employee in the Plan as of an Enrollment
Date will constitute the grant as of such Enrollment Date by the Company to
such
Participant of an option to purchase Shares from the Company pursuant to the
Plan.
7.2 An
option
granted to a Participant pursuant to this Plan shall expire, if not terminated
earlier for any reason, on the earliest to occur of: (a) the end of the
Purchase Date with respect to the Accumulation Period in which such option
was
granted; (b) the completion of the purchase of Shares under the option
under Article IX; or (c) the date on which participation of such
Participant in the Plan terminates for any reason.
7.3 As
of
each Enrollment Date, each Participant shall automatically be granted an option
to purchase, subject to the terms of the Plan, the number of whole Shares equal
to the quotient of $25,000
divided
by the Fair Market Value of a Share on the Enrollment Date.
Notwithstanding
any other provision of this Plan, no Employee may be granted an option which
permits his or her rights to purchase Shares under the Plan and any other Code
Section 423 employee stock purchase plan of the Company or any of its
Subsidiaries or parent companies to accrue (when the option first becomes
exercisable) at a rate which exceeds $25,000 of Fair Market Value of such Shares
(determined at the time such option is granted) for each calendar year in which
such option is outstanding at any time.
VIII. Payroll
Deductions
8.1 An
Employee who files an enrollment form pursuant to Article VI shall elect and
authorize in such form to have deductions made from his or her pay on each
payday he or she receives a paycheck during the Accumulation Period to which
the
enrollment form relates, and he or she shall designate in such form the
percentage (in whole percentages) of Base Earnings to be deducted each payday
during such Accumulation Period. The minimum an Employee may elect and authorize
to have deducted is 1% of his or her Base Earnings paid per pay period in such
Accumulation Period, and the maximum is 10% of his or her Base Earnings paid
per
pay period in such Accumulation Period (or such larger or smaller percentage
as
the Administrator may designate from time to time).
8.2 Except
as
provided in the last paragraph of Section 6.1, deductions from a Participant’s
Base Earnings shall commence upon the first payday on or after the commencement
of the Accumulation Period, and shall continue until the date on which such
authorization ceases to be effective in accordance with Article VI. The amount
of each deduction made for a Participant shall be credited to the Participant’s
Account. All payroll deductions received or held by the Company or a
Participating Subsidiary may be, but are not required to be, used by the Company
or Participating Subsidiary for any corporate purpose, and the Company or
Participating Subsidiary shall not be obligated to segregate such payroll
deductions, but may do so at the discretion of the Board.
8.3 As
of the
last day of any month during an Accumulation Period, a Participant may elect
to
cease (but not to increase or decrease) payroll deductions made on his or her
behalf for the remainder of such Accumulation Period by filing the applicable
election with the Company or Participating Subsidiary in such form and manner
and at such time as may be permitted by the Administrator. A Participant who
has
ceased payroll deductions may have the amount which was credited to his or
her
Account prior to such cessation applied to the purchase of Shares as of the
Purchase Date, in accordance with Section 9.1, and receive the balance of the
Account with respect to which the enrollment is ceased, if any, in cash. A
Participant who has ceased payroll deductions may also voluntarily withdraw
from
the Plan pursuant to Section 10.1. Any Participant who ceases payroll deductions
for an Accumulation Period may re-enroll in the Plan on the next subsequent
Enrollment Date following the cessation in accordance with the provisions of
Article VI. A Participant who ceases to be employed by the Company or any
Participating Subsidiary will cease to be a Participant in accordance with
Section 10.2.
8.4 A
Participant may not make any separate or additional contributions to his Account
under the Plan. Neither the Company nor any Participating Subsidiary shall
make
separate or additional contributions to any Participant’s Account under the
Plan.
IX. Purchase
of Shares
9.1 Subject
to Section 9.2, any option held by the Participant which was granted under
this
Plan and which remains outstanding as of a Purchase Date shall be deemed to
have
been exercised on such Purchase Date for the purchase of the number of whole
Shares which the funds accumulated in his or her Account as of the Purchase
Date
will purchase at the applicable purchase price (but not in excess of the number
of Shares for which options have been granted to the Participant pursuant to
Section 7.3). No Shares will be purchased on behalf of any Participant who
fails
to file an enrollment form authorizing payroll deductions for an Accumulation
Period.
9.2 A
Participant who holds an outstanding option as of a Purchase Date shall not
be
deemed to have exercised such option if the Participant elected not to exercise
the option by withdrawing from the Plan in accordance with Section
10.1.
9.3 If,
after
a Participant’s exercise of an option under Section 9.1, an amount remains
credited to the Participant’s Account as of a Purchase Date, then the remaining
amount shall be distributed to the Participant in cash as soon as
administratively practical after such Purchase Date.
9.4 Except
as
otherwise set forth in this Section 9.4, the purchase price for each Share
purchased under any option shall be 85% of the lower of:
(a) the
Fair
Market Value of a Share on the Enrollment Date on which such option is granted;
or
(b) the
Fair
Market Value of a Share on the Purchase Date.
Notwithstanding
the above, the Board may establish a different purchase price for each Share
purchased under any option provided that such purchase price is determined
at
least thirty (30) days prior to the Accumulation Period for which it is
applicable and provided that such purchase price may not be less than the
purchase price set forth above.
9.5 If
Shares
are purchased by a Participant pursuant to Section 9.1, then such Shares shall
be held in non-certificated form at a bank or other appropriate institution
selected by the Administrator until the earlier of the Participant’s termination
of employment or the time a Participant requests delivery of certificates
representing such shares. If any law governing corporate or securities matters,
or any applicable regulation of the Securities and Exchange Commission or other
body having jurisdiction with respect to such matters, shall require that the
Company or the Participant take any action in connection with the Shares being
purchased under the option, delivery of the certificate or certificates for
such
Shares shall be postponed until the necessary action shall have been completed,
which action shall be taken by the Company at its own expense, without
unreasonable delay.
Certificates
delivered pursuant to this Section 9.5 shall be registered in the name of the
Participant or, if the Participant so elects, in the names of the Participant
and one or more such other persons as may be designated by the Participant
in
joint tenancy with rights of survivorship or in tenancy by the entireties or
as
spousal community property, or in such forms of trust as may be approved by
the
Administrator, to the extent permitted by law.
9.6 In
the
case of Participants employed by a Participating Subsidiary, the Board may
provide for Shares to be sold through the Subsidiary to such Participants,
to
the extent consistent with and governed by Section 423 of the Code.
9.7 If
the
total number of Shares for which an option is exercised on any Purchase Date
in
accordance with this Article IX, when aggregated with all Shares previously
granted under this Plan, exceeds the maximum number of Shares reserved in
Section 4.1, the Administrator shall make a pro rata allocation of the Shares
available for delivery and distribution in as nearly a uniform manner as shall
be practicable and as it shall determine to be equitable, and the balance of
the
cash amount credited to the Account of each Participant under the Plan shall
be
returned to him or her as promptly as administratively practical.
9.8 If
a
Participant or former Participant sells, transfers, or otherwise makes a
disposition of Shares purchased pursuant to an option granted under the Plan
within two years after the date such option is granted or within one year after
the Purchase Date to which such option relates, or if the Participant or former
Participant otherwise has a taxable event relating to Shares purchased under
the
Plan, and if such Participant or former Participant is subject to U.S. federal
income tax, then such Participant or former Participant shall notify the Company
or Participating Subsidiary in writing of any such sale, transfer or other
disposition within 10 days of the consummation of such sale, transfer or other
disposition, and shall remit to the Company or Participating Subsidiary or
authorize the Company or Participating Subsidiary to withhold from other sources
such amount as the Company may determine to be necessary to satisfy any federal,
state or local tax withholding obligations of the Company or Participating
Subsidiary. A Participant must reply to a written request, within 10 days of
the
receipt of such written request, from the Company, Participating Subsidiary,
or
Administrator regarding whether such a sale, transfer or other disposition
has
occurred.
The
Administrator may from time to time establish rules and procedures (including
but not limited to postponing delivery of Shares until the earlier of the
expiration of the two-year or one-year period or the disposition of such Shares
by the Participant) to cause the withholding requirements to be
satisfied.
X. Withdrawal
From the Plan; Termination of Employment; Leave of Absence;
Death
10.1 Withdrawal
from the Plan.
Effective as of the last day of any calendar quarter during an Accumulation
Period, a Participant may withdraw from the Plan in full (but not in part)
by
delivering a notice of withdrawal to the Company (in a manner prescribed by
the
Administrator) at least ten business days prior to the end of such calendar
quarter (but in no event later than the June 1 or December 1 immediately
preceding the Purchase Date for the Plan's two Accumulation Periods,
respectively). Upon such withdrawal from participation in the Plan, all funds
then accumulated in the Participant’s Account shall not be used to purchase
Shares, but shall instead be distributed to the Participant as soon as
administratively practical after the end of such calendar quarter, and the
Participant’s payroll deductions shall cease as of the end of such calendar
quarter. An Employee who has withdrawn during an Accumulation Period may not
return funds to the Company or a Participating Subsidiary during the same
Accumulation Period and require the Company or Participating Subsidiary to
apply
those funds to the purchase of Shares, nor may such Participant’s payroll
deductions continue, in accordance with Article VI. Any Eligible Employee who
has withdrawn from the Plan may, however, re-enroll in the Plan on the next
subsequent Enrollment Date following withdrawal in accordance with the
provisions of Article VI.
10.2 Termination
of Employment.
Participation in the Plan terminates immediately when a Participant ceases
to be
employed by the Company or any Participating Subsidiary for any reason
whatsoever, including but not limited to termination of employment, whether
voluntary or involuntary, or on account of disability, or retirement, but not
including death, or if the participating Subsidiary employing the Participant
ceases for any reason to be a Participating Subsidiary. Participation in the
Plan also terminates immediately when a Participant ceases to be an Eligible
Employee under Article V or withdraws from the Plan. Upon termination of
participation such terminated Participant’s outstanding options shall thereupon
terminate. As soon as administratively practical after termination of
participation, the Company shall pay to the Participant or legal representative
all amounts accumulated in the Participant’s Account and held by the Company at
the time of termination of participation, and any Participating Subsidiary
shall
pay to the Participant or legal representative all amounts accumulated in the
Participant's Account and held by the Participating Subsidiary at the time
of
termination of participation.
10.3 Leaves
of Absence.
(a)
If
a
Participant takes a leave of absence (other than an Authorized Leave of Absence)
without terminating employment, such Participant will be deemed to have
discontinued contributions to the Plan in accordance with Section 8.3, but
will
remain a Participant in the Plan through the balance of the Accumulation Period
in which his or her leave of absence begins, so long as such leave of absence
does not exceed 90 days. If a Participant takes a leave of absence (other than
an Authorized Leave of Absence) without terminating employment, such Participant
will be deemed to have withdrawn from the Plan in accordance with Section 10.1
if such leave of absence exceeds 90 days.
(b)
An
Employee on an Authorized Leave of Absence shall remain a Participant in the
Plan and, in the case of a paid Authorized Leave of Absence, shall have
deductions made under Section 8.1 from payments that would, but for the
Authorized Leave of Absence, be Base Earnings. An Employee who does not return
from an Authorized Leave of Absence on the scheduled date (or, in the case
of
Qualified Military Leave, prior to the date such individual’s reemployment
rights under the Uniformed Services Employment and Reemployment Rights Act
of
1994 have expired or terminated) shall be deemed to have terminated employment
on the last day of such Authorized Leave of Absence (or, in the case of
Qualified Military Leave, the date such reemployment rights expire or are
terminated).
(c)
An
“Authorized Leave of Absence” means (a) a Qualified Military Leave, and (b) an
Employee’s absence of more than 90 days which has been authorized, either
pursuant to a policy of the Company or the Participating Subsidiary that employs
the Employee, or pursuant to a written agreement between the employer and the
Employee, which policy or written agreement guarantees the Employee’s rights to
return to employment.
10.4 Death.
As soon
as administratively feasible after the death of a Participant, amounts
accumulated in his or her Account shall be paid in cash to the beneficiary
or
beneficiaries designated by the Participant on a beneficiary designation form
approved by the Board, but if the Participant does not make an effective
beneficiary designation then such amounts shall be paid in cash to the
Participant’s spouse if the Participant has a spouse, or, if the Participant
does not have a spouse, to the executor, administrator or other legal
representative of the Participant’s estate. Such payment shall relieve the
Company and the Participating Subsidiary of further liability with respect
to
the Plan on account of the deceased Participant. If more than one beneficiary
is
designated, each beneficiary shall receive an equal portion of the Account
unless the Participant has given express contrary instructions. None of the
Participant’s beneficiary, spouse, executor, administrator or other legal
representative of the Participant’s estate shall, prior to the death of the
Participant by whom he has been designated, acquire any interest in the amounts
credited to the Participant’s Account under the Plan.
XI. Miscellaneous
11.1 Interest.
Interest or earnings will not be paid on any Employee Accounts.
11.2 Restrictions
on Transfer.
The
rights of a Participant under the Plan shall not be assignable or transferable
by such Participant, and an option granted under the Plan may not be exercised
during a Participant’s lifetime other than 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 from
the
Plan in accordance with Section 10.1.
11.3 Administrative
Assistance.
If the
Administrator in its discretion so elects, it may retain a brokerage firm,
bank,
other financial institution or other appropriate agent to assist in the purchase
of Shares, delivery of reports or other administrative aspects of the Plan.
If
the Administrator so elects, each Participant shall (unless prohibited by
applicable law) be deemed upon enrollment in the Plan to have authorized the
establishment of an account on his or her behalf at such institution. Shares
purchased by a Participant under the Plan shall be held in the account in the
Participant’s name, or if the Participant so indicates in the enrollment form,
in the Participant’s name together with the name of one or more other persons in
joint tenancy with right of survivorship or in tenancy by the entireties or
as
spousal community property, or in such forms of trust as may be approved by
the
Administrator, to the extent permitted by law.
11.4 Costs.
All
costs and expenses incurred in administering the Plan shall be paid by the
Company or Participating Subsidiaries, including any brokerage fees on the
purchased Shares; excepting that any stamp duties, transfer taxes, fees to
issue
stock certificates, and any brokerage fees on the sale price applicable to
participation in the Plan after the initial purchase of the Shares on the
Purchase Date shall be charged to the Account or brokerage account of such
Participant.
11.5 Equal
Rights and Privileges.
All
Eligible Employees shall have equal rights and privileges with respect to the
Plan so that the Plan qualifies as an "employee stock purchase plan" within
the
meaning of Section 423 or any successor provision of the Code and the
related regulations. Notwithstanding the express terms of the Plan, any
provision of the Plan which is inconsistent with Section 423 or any
successor provision of the Code shall without further act or amendment by the
Company or the Board be reformed to comply with the requirements of Code
Section 423. This Section 11.5 shall take precedence over all other
provisions in the Plan.
11.6 Applicable
Law.
The
Plan shall be governed by the substantive laws (excluding the conflict of laws
rules) of the State of Kansas.
11.7 Amendment
and Termination.
The
Board may amend, alter or terminate the Plan at any time; provided, however,
that no amendment which would amend or modify the Plan in a manner requiring
stockholder approval under Code Section 423 or the requirements of any
securities exchange on which the Shares are traded shall be effective unless,
within one year after it is adopted by the Board, it is approved by the holders
of a majority of the voting power of the Company’s outstanding shares. In
addition, the Board (if appointed under Section 3.1) may amend the Plan as
provided in Section 3.3, subject to the conditions set forth therein and in
this
Section 11.7.
If
the
Plan is terminated, the Board may elect to terminate all outstanding options
either prior to their expiration or upon completion of the purchase of Shares
on
the next Purchase Date, or may elect to permit options to expire in accordance
with the terms of this Plan (and participation to continue through such
expiration dates). If the options are terminated prior to expiration, all funds
accumulated in Participants’ Accounts as of the date the options are terminated
shall be returned to the Participants as soon as administratively
feasible.
11.8 No
Right of Employment.
Neither
the grant nor the exercise of any rights to purchase Shares under this Plan
nor
anything in this Plan shall impose upon the Company or Participating Subsidiary
any obligation to employ or continue to employ any employee. The right of the
Company or Participating Subsidiary to terminate any employee shall not be
diminished or affected because any rights to purchase Shares have been granted
to such employee.
11.9 Requirements
of Law.
The
Company shall not be required to sell, issue, or deliver any Shares under this
Plan if such sale, issuance, or delivery might constitute a violation by the
Company or the Participant of any provision of law. Unless a registration
statement under the Securities Act is in effect with respect to the Shares
proposed to be delivered under the Plan, the Company shall not be required
to
issue such Shares if, in the opinion of the Company or its counsel, such
issuance would violate the Securities Act. Regardless of whether such Shares
have been registered under the Securities Act or registered or qualified under
the securities laws of any state, the Company may impose restrictions upon
the
hypothecation or further sale or transfer of such shares (including the
placement of appropriate legends on stock certificates) if, in the judgment
of
the Company or its counsel, such restrictions are necessary or desirable to
achieve compliance with the provisions of the Securities Act, the securities
laws of any state, or any other law or are otherwise in the best interests
of
the Company. Any determination by the Company or its counsel in connection
with
any of the foregoing shall be final and binding on all parties.
If,
in
the opinion of the Company and its counsel, any legend placed on a stock
certificate representing Shares issued under the Plan is no longer required
in
order to comply with applicable securities or other laws, the holder of such
certificate shall be entitled to exchange such certificate for a certificate
representing a like number of shares lacking such legend.
The
Company may, but shall not be obligated to, register or qualify any securities
covered by the Plan. The Company shall not be obligated to take any other
affirmative action in order to cause the grant or exercise of any right or
the
issuance, sale, or deliver of Shares pursuant to the exercise of any right
to
comply with any law.
11.10 Gender.
When
used herein, masculine terms shall be deemed to include the feminine, except
when the context indicates to the contrary.
11.11 Withholding
of Taxes.
The
Company or Participating Subsidiary may withhold from any purchase of Shares
under this Plan or any sale, transfer or other disposition thereof any local,
state, federal or foreign taxes, employment taxes, or other taxes at such times
and from such other amounts as it deems appropriate. The Company or
Participating Subsidiary may require the Participant to remit an amount in
cash
sufficient to satisfy any required withholding amounts to the Company or
Participating Subsidiary, as the case may be.
Executed
this 27th day of October, 2007. |
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GARMIN
LTD. |
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By: |
/s/ Min
H.
Kao |
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Min
H. Kao
Chairman
and CEO
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