-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WDXKA/OrW3xx8vMcVguWTG6G5HjlI8RLKdbGxzoJNnfU7RL2JQ7sXGwwVbq8vD19 NJb+0DqIGohWUkuNA9h5Lg== 0000093384-05-000037.txt : 20051026 0000093384-05-000037.hdr.sgml : 20051026 20051026120358 ACCESSION NUMBER: 0000093384-05-000037 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20051014 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051026 DATE AS OF CHANGE: 20051026 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STANDARD MICROSYSTEMS CORP CENTRAL INDEX KEY: 0000093384 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 112234952 STATE OF INCORPORATION: DE FISCAL YEAR END: 0806 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-07422 FILM NUMBER: 051156280 BUSINESS ADDRESS: STREET 1: 80 ARKAY DRIVE CITY: HAUPPAUGE STATE: NY ZIP: 11788 BUSINESS PHONE: 6314342904 MAIL ADDRESS: STREET 1: 80 ARKAY DR CITY: HAUPPAUGE STATE: NY ZIP: 11788 8-K 1 form8k-ghouseweart.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): September 9, 2005 ---------------------------------------- STANDARD MICROSYSTEMS CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 0-7422 11-2234952 (State or other jurisdiction of (Commission File (I.R.S. Employer incorporation) Number) Identification No.) 80 Arkay Drive, Hauppauge, New York 11788 (Address of principal executive offices) (Zip Code) (631) 435-6000 (Registrant's telephone number, including area code) N/A (Former name, former address and former fiscal year, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ---------------------------------------- Item 1.01 - Entry into a Material Definitive Agreement a) On October 14, 2005, SMSC North America, Inc., a subsidiary of Standard Microsystems Corporation ("SMSC") entered into an Early Retirement and General Release agreement (the "Agreement") with George W. Houseweart, Senior Vice President, General Counsel and Secretary of the Corporation. The Agreement became effective on October 22, 2005. Mr. Houseweart relinquished the positions of General Counsel and Secretary of SMSC on October 24, 2005. He will remain as a Senior Vice President until February 1, 2006 at his current salary, wages, bonuses and car allowances, and then will continue to be employed by SMSC in a part time capacity at 75% of his annual base salary until September 30, 2006. Mr. Houseweart also provided a general release to SMSC. This description is qualified in its entirety by the full text of the Agreement, attached hereto as Exhibit 10.1 and incorporated herein by reference. b) On September 9, 2005, the Board of Directors of SMSC amended the Corporation's 2005 Inducement Stock Option and Restricted Stock Plan (the "Plan"): (i) to increase the number of authorized shares to a total of 1,960,000 shares; and (ii) to delete the restriction on the maximum number of options that may be granted to any one individual in a fiscal year. This description is qualified in its entirety by the full text of the Plan attached hereto as Exhibit 10.2 and incorporated herein by reference. Item 9.01 - Financial Statements and Exhibits (c) Exhibits 10.1* -Early Retirement and General Release agreement with George W. Houseweart, dated October 14, 2005. 10.2* -2005 Inducement Stock Option and Restricted Stock Plan of Standard Microsystems Corporation, as amended on September 9, 2005. * Indicates a management contract or compensatory plan or arrangement. ---------------------------------------- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. STANDARD MICROSYSTEMS CORPORATION (Registrant) Date: October 26, 2005 By: /s/ Eric M. Nowling -------------------------------- (Vice President, Controller and Chief Accounting Officer) ---------------------------------------- Exhibit Index Exhibit No. Description 10.1* - Early Retirement and General Release agreement with George W. Houseweart dated October 14, 2005. 10.2* - 2005 Inducement Stock Option and Restricted Stock Plan of Standard Microsystems Corporation, as amended on September 9, 2005. * Indicates a management contract or compensatory plan or arrangement. EX-10.1 2 exhibit_10-1.txt Exhibit 10.1 EARLY RETIREMENT AGREEMENT AND GENERAL RELEASE WHEREAS, George W. Houseweart (the "Employee") is an employee of SMSC North America, Inc. ("SMSC" or the "Company"); and WHEREAS, the Employee's normal retirement date is March 21, 2007; and WHEREAS, the parties have mutually agreed that the Employee will voluntary retire early, effective as of September 30, 2006; and WHEREAS, the parties have agreed to different job titles and responsibilities during the period from October 24, 2005 through September 30, 2006; and WHEREAS, the parties have also agreed to a reduction in compensation and hours effective as of February 1, 2006, in order to allow the Employee to work on a part-time basis for SMSC, while retaining all employee benefits otherwise available to the Employee; and WHEREAS, the Employee is an employee-at-will with SMSC, and no Employment Agreement or Offer Letter exists between the Employee and SMSC providing for the payment of any early retirement benefits; and WHEREAS, the Employee is not being terminated by SMSC and is therefore not entitled to any benefits under the Standard Microsystems Corporation Severance Plan as a result of this Early Retirement Agreement; and WHEREAS, SMSC is willing to make all payments as identified in this Agreement in order to ensure a smooth transition of responsibilities prior to the Employee's early retirement date; and WHEREAS, this Agreement will serve as an individually negotiated Early Retirement Agreement and General Release between the Employee and SMSC; and WHEREAS, the terms and condition of this Agreement are contingent upon execution of this Agreement. NOW, THEREFORE, in consideration of the foregoing statements and the mutual promises set forth below, the Employee and SMSC agree, effective as of the last day of the period during which the Employee may revoke this Agreement, as follows: 1. Early Retirement Date. The Employee's early retirement date will be September 30, 2006 (the "Early Retirement Date"). 2. Job Titles. The Employee will hold the following positions during the period prior to his Early Retirement Date. a. On October 24, 2005, the Employee will relinquish the positions of General Counsel and Secretary of SMSC and will hold the position of Senior Vice President. b. On February 1, 2006, the Employee will relinquish the title of Senior Vice President and will become an Intellectual Property Attorney until the Early Retirement Date. 3. Compensation and Benefits Prior to Early Retirement. During the period from execution of this Agreement until the Employee's Early Retirement Date, the Employee will be entitled to the following general benefits: a. All current salary, wages, bonuses and car allowances will be paid through January 31, 2006, in accordance with SMSC's normal payroll procedures. b. During the period from February 1, 2006 until September 30, 2006, the Employee will receive 75% of the Employee's annual base salary as of January 30, 2006 (i.e., 275,000 x 75% = $206,250), in accordance with normal payroll procedures. The period from February 1, 2006 through September 30, 2006 shall be known as the "Part-Time Employment Period". During the Part-Time Employment Period, the Employee will be expected to work the minimum number of hours necessary to retain all employee benefits for medical, dental, LTD and other insurances for active employees, that will be maintained in accordance with all normal policies and procedures. The Employee acknowledges that these benefits are governed by the term of all benefit programs. To the extent that any benefits cannot be maintained as a result of the transition to part-time status, SMSC will only be responsible for the premium cost of such benefits, which will be paid to the Employee, with a gross up for any tax liabilities. c. The Employee will be eligible to the Employee's full bonus for the 2006 fiscal year end bonus under the SMSC 2006 Management Incentive Plan ("MIP"); and the fourth quarter bonus for the period ending February 28, 2006 under the MIP (each adjusted for corporate but not individual performance). All of these benefits will be paid in accordance with all applicable plans. d. SMSC will continue to pay the full cost of all individual life and disability policies during the Part-Time Employment Period. e. The Employee will not be entitled to any bonus for the 2007 fiscal year ending February 28, 2007, including any quarterly bonuses. f. Upon the Early Retirement Date, SMSC will vest the Employee in all unvested Restricted Stock Awards, but not any unvested Stock Options or Stock Appreciation Rights. g. In accordance with the January 1, 2005 Amendment to the Standard Microsystems Corporation Executive Retirement Plan (the "SERP"), the Board will approve the determination of the Employee's Base Annual Salary, as defined in the SERP as of the period prior to the Part-Time Employment Period. Accordingly, the Employee will not incur a reduction in the Employee's SERP benefit as a result of the reduction in hours and compensation during the Part-Time Employee Period. h. SMSC will maintain all business telephone and internet services during the Part-Time Employment Period. i. At the commencement of the Part-Time Employment Period, the Employee will relinquish his car allowance and will no longer be eligible for any vacation accruals. All accrued vacation as of the commencement of the Part-Time Employment Period will be paid in the Employee's first payroll in February, 2006 at the rate of compensation prior to the Part-Time Employment Period. 4. Early Retirement Benefits. Following the Employee's Early Retirement Date, the Employee will be entitled to the following general benefits consistent with a normal retirement from SMSC, and the additional COBRA and other benefits: a. The Employee will be entitled to elect to receive continuation health coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA") after the Employee's Early Retirement Date, which is the date of a "qualifying event" under COBRA, if the Employee was receiving medical, dental and vision coverage from SMSC. SMSC agrees to reimburse the Employee and/or directly pay the cost of COBRA benefits for the Employee and the Employee's spouse from October, 2006 through March, 2007, when the Employee would otherwise have attained his normal retirement age. b. All group-term life insurance, long-term disability and short-term disability will terminate in accordance with the provisions of all plans, usually as of the Early Retirement Date. The Employee may be entitled to individual conversion privileges under the various policies. SMSC will provide information to the Employee regarding all individual conversion rights. c. The Employee will be entitled to a distribution of all vested benefits under the Standard Microsystems Corporation Investment Savings and Retirement Plan (the "Section 401(k) Plan"). d. The Employee will be entitled to retain the corporate cell phone, laptop, monitor, fax, file cabinet, and related equipment used by the Employee. The value of such property will be included in the Employee's W-2 Form for the 2006 calendar year. The early retirement benefits whereby SMSC agrees to reimburse or pay for the cost of COBRA coverage for the period between the Employee's Early Retirement Date and the date the Employee would otherwise have attained age 65 will be paid in accordance with the Company's normal payroll procedures. However, no COBRA benefits will be paid, until after the return of all property to SMSC, as provided in Section 6. Notwithstanding any provision to the contrary, the payment of any COBRA benefits will not be treated as extending the Employee's employment for any employee benefit or employment purposes. 5. Adequate Consideration. The Employee acknowledges and agrees that the vesting of all unvested Restricted Stock Awards, the exercise of discretion to determine the Employee's Base Annual Salary under the SERP, and the payment for the cost of COBRA coverage during the period between the Employee's Early Retirement Date and the attainment of age 65 (the "Enhanced Benefits"), are adequate and sufficient consideration for the Employee's execution of the General Release set forth below. 6. Return of Property. To the extent the Employee is in the possession of any SMSC property, excluding the property addressed in Section 4(d), including building access passes and keys, SMSC credit cards, and any SMSC documents, correspondence and related corporate materials, the Employee will return all property to SMSC on or before the Early Retirement Date. 7. Expense Accounts and Reports. The Employee will be allowed to submit a final expense report and accounting to SMSC within 2 weeks after the Early Retirement Date, and will receive all necessary reimbursements from SMSC, if any, in accordance with all corporate policies and procedures. 8. General Release. In exchange for the Enhanced Benefits made available under this Agreement, the Employee agrees to forever release and discharge SMSC, and all subsidiaries and affiliates, as provided under Section 414 of the Internal Revenue Code (the "Code") in determining a single employer for purposes of employee benefits (collectively, "Related Entities"), and all officers, directors, agents, and employees of SMSC or Related Entities, from all claims, grievances, liabilities, and lawsuits whether or not arising out of the Employee's employment or the Employee's early retirement from SMSC, and agrees not to assert any such claim, grievance, liability, or lawsuit. This release includes, but is not limited to, any claim under the following laws: (a) The Constitution of the United States; (b) The Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. ss.621 et seq., which prohibits age discrimination in employment; (c) Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. ss.2000(e) et seq., which prohibits discrimination in employment based on race, color, national origin, religion or sex; (d) The Civil Rights Act of 1866, 42 U.S.C. ss.1981 et seq.; (e) The Equal Pay Act, which prohibits paying men and women unequal pay for equal work; (f) Any other federal, state, or local law or regulation prohibiting employment discrimination; (g) The Employee Retirement Income Security Act, 29 U.S.C. ss.1001 et seq. ("ERISA"); (h) Section 806 of 18 U.S.C. ss.1514A. (i) Executive Orders 11246 and 11141; (j) The Americans with Disabilities Act of 1990, 42 U.S.C. ss.12101 et seq.; (k) The Federal Family and Medical Leave Act, 29 U.S.C. ss.2601 et seq. and any comparable state statutes; (l) The Constitution of the State of New York or any other applicable states; (m) Any claim arising from any express or implied contracts; (n) Any claim under any other statute, regulation, ordinance, or common law rule relating to the Employee's employment or separation from employment, including any claim for wrongful discharge or defamation arising out of employment or otherwise. The Employee waives any claims or rights to payment of any attorney's or professional advisor fees or expenses for review of this document or any issues arising out of the Employee's early retirement. Notwithstanding any provisions to the contrary, this release does not include, a release of: (a) the Employee's rights under this Agreement; (b) the Employee's right, if any, to individual conversion privileges under any medical, dental, long term disability, life insurance, and other welfare programs; (c) any obligations under the SERP; and (d) any obligation of the Company to the Employee under any indemnity agreement or any obligation of the Company to indemnify the Employee pursuant to contract, law, charter, by-law or otherwise. 9. No Future Lawsuits. The Employee agrees that the Employee will not file, or permit to be filed in the Employee's name or on the Employee's behalf, any lawsuit or administrative claim against any of the persons or entities released in this Agreement based upon any act or event which occurred before the effective date of this Agreement. The Employee will also not cooperate in the initiation of any lawsuits, except as otherwise required by law. In the event any charge or complaint is filed or any action is pursued by others in the Employee's name or on the Employee's behalf by or before any federal, state, or local agency or court, the Employee hereby waives the right to any damages or other relief from any such action. This paragraph does not apply to a challenge made by the Employee to the knowing and voluntary nature of the Employee's waiver of claims under the Age Discrimination in Employment Act of 1967, as amended ("ADEA"). 10. Non-Admission of Liability. The use of this Agreement by SMSC does not signify any liability by SMSC or any Related Entities to provide any benefits. 11. Period for Review and Consideration of Agreement. The Employee understands that the Employee will be given a period of 21 days to review and consider this Agreement before signing it. The Employee further understands that the Employee may wait up to 21 days prior to signing the Agreement, or may also execute the Agreement prior to the expiration of the 21 day review period. 12. Older Workers Benefit Protection Act. SMSC is not required to provide the Employee with certain demographic information required by the Older Workers Benefit Protection Act of 1990, due to the voluntary early retirement by the Employee. 13. Encouragement to Consult Attorney. The Employee is encouraged to consult with an attorney before signing this Agreement. 14. Right to Revoke Agreement. The Employee may revoke this Agreement within 7 calendar days of the Employee's signing of this Agreement. If this Agreement has not been revoked within such 7 day period, it becomes effective on the 8th day. Revocation can be made by delivering a written notice of revocation to Andy Solowey, Senior Vice President of Human Resources. For this revocation to be effective, written notice must be received by SMSC no later than close of business on the 7th calendar day after the Employee signs this Agreement. If the Employee fails to sign this Agreement or revokes this Agreement, it will not be effective or enforceable and the Employee will not receive the Enhanced Benefits described in Sections 3 and 4 of this Agreement. 15. Intellectual Property and Confidential Information. All of the Employee's obligations under the Patent and Trade Secrets Agreement dated December 12, 1988, will end on the Early Retirement Date, except to the extent provided in Section 16 below. 16. Trade Secrets, Confidential and/or Proprietary Information. The Employee will regard and preserve as confidential: (i) all trade secrets and/or other proprietary and/or confidential information belonging to the Company or any Related Entities; and (ii) all trade secrets and/or other proprietary and/or confidential information belonging to a third party which have been confidentially disclosed to the Company or any Related Entities, which trade secrets and/or other proprietary and/or confidential information described in (i) and (ii) above (collectively, "Confidential Information") have been disclosed to the Employee by reason of the Employee's relationship with the Company or any Related Entities. The Employee will not, without written authority from the Company to do so, use for the Employee's own benefit or purposes, or the benefit or purpose of any person or entity other than the Company, nor disclose to others, any Confidential Information. This provision will not apply to the Employee's general expertise and know-how, nor to Confidential Information that has been voluntarily disclosed to the public by the Company, or otherwise entered the public domain through lawful means. Confidential Information shall include, but not be limited to, all nonpublic information relating to the Company's: (i) business, research, development and marketing plans, strategies and forecasts; (ii) business; (iii) products (whether existing, in development, or being contemplated); (iv) reports; (v) formulas; (vi) specifications; (vii) designs, software and other technology; (viii) research and development programs; (ix) terms of contracts; and (x) any employee information. 17. Return of Documents. Upon the Early Retirement Date, the Employee will return all media on which any Confidential Information may be recorded or located, including, without limitation, documents, program source codes, samples, models, blueprints, photocopies, photographs, drawings, descriptions, reproductions, cards, tapes, discs and other storage facilities (collectively "Documentation") made by the Employee or that came into the Employee's possession by reason of the Employee's employment with the Company that are the property of the Company and shall be returned to the Company. The Employee will not deliver, reproduce, or in any way allow any Documentation to be delivered or used by any third party without the written direction or consent of a duly authorized representative of the Company. 18. Covenant Not to Compete. The Employee agrees that for a period of 1 year after the Early Retirement Date, the Employee will not, directly or indirectly, through any other person, firm, corporation or other entity, compete with the Company or any Related Entities, anywhere in the United States in the performance of services similar to the services being provided prior to the Employee's Early Retirement Date or any prior services provided to SMSC or any Related Entities. The Company and the Employee agree that the Company's and all Related Entities business is national in scope and is highly competitive. 19. No Solicitation of Employees. During the course of employment with the Company, the Employee came into contact and became familiar with the Company's employees, their knowledge, skills, abilities, salaries, commissions, draws, benefits, and other matters with respect to such employees, all of which information is not generally known to the public, but has been developed, acquired or compiled by the Company at its great effort and expense. Any solicitation, luring away or hiring of such employees of the Company will be highly detrimental to the business of the Company and may cause serious loss of business and great and irreparable harm. Consequently, the Employee covenants and agrees that for a period of 1 year after the Employee's Early Retirement Date, the Employee will not, directly or indirectly, whether on behalf of the Employee or others, solicit, lure or hire away any employees of the Company or any Related Entities, or assist or aid in any such activity. 20. No Solicitation of Clients. The Employee agrees that for a period of 1 year after the Employee's Early Retirement Date, the Employee will not, directly or indirectly, through any other person, firm, corporation or other entity, solicit any customers or clients of the Company or any Related Entities. 21. Reasonableness of Covenants. The Employee acknowledges that the scope of the Covenant Not to Compete and the Nonsolicitation of Employees and Client provisions contained in this Agreement are reasonable. In the event that any aspect of these provisions is deemed to be unreasonable by a court, the Employee will submit to any reductions as the court will deem reasonable. In the event the Employee violates these provisions, then the time limitations will be extended for a period of time equal to the pendency of such proceedings, including appeals. 22. Confidentiality of Terms. The Employee and SMSC agree that the terms of this Agreement are confidential and will not be disclosed to any person without the written consent of SMSC, except to the Employee's legal and tax advisors and members of the Employee's immediate family, or to the extent required by law. However, the Employee agrees and acknowledges that this Agreement may be introduced as evidence by SMSC in the event the Employee commences any legal, administrative, judicial or arbitration proceedings against SMSC. 23. Non-Defamation. The Employee agrees that the Employee will not, directly or indirectly, in public or private, deprecate, impugn or otherwise make any remarks that would tend to or be construed to tend to defame SMSC or its reputation, nor will the Employee assist any other person, firm or company in engaging in such activities. SMSC also agrees not to engage in any activities, directly or indirectly, that would defame the Employee, or the Employee's reputation. 24. Consequences of Violation of Promises. If the Employee breaks any of the Employee's promises contained within this Agreement and/or files any lawsuit based on legal claims that the Employee has released, the Employee will pay for all costs incurred by SMSC, any Related Entities, or the officers, directors, agents or employees of SMSC or any Related Entities, including reasonable attorney's fees to enforce any provisions or to defend against any claim by the Employee. The Employee also agrees that if the Employee acts in violation of this Agreement, the Employee will remit to SMSC any and all monies paid to the Employee or any other parties under this Agreement, including the cost of any COBRA coverage, and all severance benefits will cease to be paid. The terms of this paragraph will not apply to a challenge to the knowing and voluntary nature of a waiver of claims under the Age Discrimination in Employment Act of 1967 and SMSC will not be penalized for exercising that right. 25. Section 409A. As part of the American Jobs Creation Act of 2004, new Section 409A of the Code was enacted to regulate nonqualified deferred compensation plans. In general, any benefits paid following the termination of an individual's employment, on a voluntary or involuntary basis, may be treated as a form of deferred compensation under Section 409A of the Code, unless a specific regulatory exemption exists. The Proposed Regulations under Section 409A of the Code currently exempt certain arrangements from the definition of deferred compensation. Under these exemptions benefits that are paid within 2 1/2 months after the end of the later of the fiscal year for an employer or the tax year for an employee in which a separation from service occurs, are not considered deferred compensation. Given the fact that the Employee's Early Retirement Date will be September 30, 2006; and the payment of COBRA benefits will be completed in March, 2007, the payment of COBRA benefits following the early retirement of the Employee will not result in any deferred compensation under the "2 1/2 month rule". This result easily occurs, since SMSC has a fiscal year ending February 28, 2007. Accordingly, all COBRA payments will clearly be made within 2 1/2 months of the SMSC tax year in which the early retirement occurs. Furthermore, the Proposed Regulations also provide that any arrangement that entitles an employee to certain reimbursements that are otherwise excludable from gross income, such as the reimbursement for COBRA benefits, that are incurred and paid by the December 31 of the second calendar year following the calendar year in which a separation from service occurs, are not considered to be deferred compensation. Based upon the Proposed Regulations, this Agreement is not subject to Section 409A, which could otherwise impose a 20% excise tax, and underpayment of tax interest penalties, on any form of nonqualified deferred compensation. 26. Entire Agreement. This document, constitutes the entire Agreement between the Employee and SMSC concerning the subject matter hereof, except to the extent the Patent and Trade Secrets Agreement has been incorporated into this Agreement. SMSC has made no promises to the Employee other than those in this Agreement concerning the subject matter hereof. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matters. 27. Waivers. A waiver by either party of any term or condition of this Agreement in any instance will not be deemed or construed to be a waiver of such term or condition for the future, or of any subsequent breach thereof. All rights, remedies, undertakings or obligations contained in this Agreement will be cumulative and none of them will be in limitation of any other right, remedy, undertaking or obligation of either party. 28. Injunctive Relief. The Employee acknowledges that damages may be an inadequate remedy in the event of an intended, threatened or actual breach by the Employee of any of the covenants made in this Agreement. Any breach by the Employee may cause SMSC great and irreparable injury and damage. To the extent that such injury and damage can be demonstrated to a court of competent jurisdiction, SMSC will be entitled, without waiving any additional rights or remedies otherwise available to SMSC at law, or in equity or by statute, to injunctive and other equitable relief in the event of an intended, threatened, or actual breach by the Employee of any said covenants. 29. Sarbanes-Oxley Act of 2002. SMSC and the Employee agree that this early retirement is occurring for the reasons cited above and is not related to any lawful actions taken by the Employee under the provisions of Section 806 of 18 U.S.C. ss.1514A. 30. No Application for Employment. The Employee agrees not to apply for any new positions with SMSC or any Related Entities after the Early Retirement Date. 31. Employment-At-Will. The Employee acknowledges that the Employee remains an employee of SMSC, and is subject to the SMSC employment-at-will policy. The Employee will be responsible for performing all responsibilities in a satisfactory manner. In the event the Employee does not satisfy the responsibilities of the Employee's position and/or violates any policies or procedures of SMSC, the Employee may be immediately terminated. Upon such action, unless such termination is for "Cause", the parties agree that all payments contemplated under this Agreement will immediately be due and payable and the Agreement will be honored. To the extent necessary to avoid any adverse tax consequences under Section 409A, the parties agree to execute a new Agreement maintaining as much of the intent of this Agreement as possible. For purposes of this provision, "Cause" shall include, but not be limited to: any material violation of the terms of this Early Retirement Agreement by the Employee; any material and intentional misstatement contained in the Employee's representations under this Early Retirement Agreement, or in any other corporate records; the commission by the Employee of any crime or fraud against the Employer or any Related Entities or their property or any crime involving moral turpitude or reasonably likely to bring discredit upon the Employer or any Related Entities; the failure to adequately perform the responsibilities of the Employee's position following written notice of such failure and not cured within 30 days; and any material violation of the Employer's published operating policies and procedures. 32. Execution of Agreement. This Agreement may be executed in two or more counterparts, each of which will be deemed an original and all of which together will constitute one and the same instrument. 33. Severability Clause. If any one or more provisions contained in this Agreement will, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability will not affect any other provision of this Agreement, but this Agreement will be construed as if such invalid, illegal or unenforceable provision had never been contained herein. 34. No Release of Future Claims. This Agreement does not waive or release any rights or claims that the Employee may have under the Age Discrimination in Employment Act which arise after the effective date of the Agreement, if applicable. 35. Reference. Reference inquiries from prospective employers will be handled by only verifying the Employee's dates of employment and last position held with SMSC consistent with SMSC's usual human resource policies and procedures. 36. Binding Agreement. The provisions of this Agreement will be binding upon the Employee, and SMSC and their successors, assigns, heirs, executors and beneficiaries. Execution of this Agreement binds the Employee to the Early Retirement Date designated above, which date may not be extended without the mutual agreement of SMSC and the Employee. 37. Captions. The captions used in this Agreement are designed for convenience of reference only and are not to be resorted to for the purpose of interpreting any provision of this Agreement. 38. New York Law. The Employee and SMSC agree that this Agreement and any interpretation thereof will be governed by the laws of the State of New York. THE EMPLOYEE ACKNOWLEDGES THAT THE EMPLOYEE HAS READ THIS AGREEMENT, UNDERSTANDS IT AND IS VOLUNTARILY ENTERING INTO IT. EMPLOYEE Dated: October 14, 2005 By: /s/ George W. Houseweart ___________________________________ George W. Houseweart SMSC NORTH AMERICA, INC. Dated: October 14, 2005 By: /s/ Steven J. Bilodeau ___________________________________ Steven J. Bilodeau Chairman and Chief Executive Officer For internal use: Date Delivered to Employee: October 14, 2005. 21-day Period for Consideration Ends November 4, 2005. Date signed: 10/14/05 7-day Period for Revocation Ends: 10/21/05 October 14, 2005 EX-10.2 3 exhibit_10-2.txt Exhibit 10.2 2005 INDUCEMENT STOCK OPTION AND RESTRICTED STOCK PLAN OF STANDARD MICROSYSTEMS CORPORATION As Amended September 9, 2005 1. Purpose of the Plan The purpose of this Standard Microsystems Corporation 2005 Inducement Stock Option And Restricted Stock Plan (the "Plan") is to promote the interests of Standard Microsystems Corporation, a Delaware corporation (together with its subsidiaries, "SMSC" or the "Company") and its stockholders by providing prospective employees of SMSC (including prospective employees who would join SMSC in connection with any corporate transaction) with an appropriate and material incentive to accept employment with SMSC. Accordingly, SMSC may, from time to time, grant to such prospective employees as may be selected in the manner hereinafter provided, options ("Options") to purchase shares of common stock, $.10 par value, of Standard Microsystems Corporation ("Common Stock") and/or awards of restricted Common Stock ("Awards"), subject to the conditions hereinafter provided. 2. Administration of the Plan (a) This Plan will be administered by the Compensation Committee (the "Committee") of the Board of Directors (the "Board"). All members of the Committee shall be both "Non-Employee Directors" within the meaning of paragraph (b)(3)(i) of Rule 16b-3 promulgated under the Securities Exchange Act of 1934 (the "Exchange Act") and "outside directors" within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code") and Treasury Regulations promulgated thereunder. The Committee shall have and may exercise all of the powers of the Board under the Plan, other than the power to appoint a director to Committee membership. A majority of the Committee shall constitute a quorum, and acts of the majority of members present at any meeting at which a quorum is present shall be deemed the acts of the Committee. The Committee may also act by instrument signed by all members of the Committee. (b) The Committee shall have plenary authority in its discretion, subject to and consistent with the express provisions of the Plan, to direct the grants of Options or Awards; to determine the numbers of shares of Common Stock covered by each Option or Award, the purchase price of the Common Stock covered by each Option, the individuals to whom and the time or times at which Options or Awards shall be granted or Options may be exercised; to prescribe, amend and rescind rules and regulations relating to the Plan, including, without limitation, such rules and regulations as it shall deem advisable so that transactions involving Options or Awards may qualify for exemption under such rules and regulations as the Securities and Exchange Commission may promulgate from time to time exempting transactions from Section 16(b) of the Exchange Act; to determine the terms and provisions of, and to cause the Company to enter into, agreements with Grantees (as defined below) in connection with Options or Awards that may be granted under the Plan ("Agreements"), which Agreements may vary from one another, as the Committee shall deem appropriate; to amend any such Agreement from time to time, with the consent of the Grantee; and to make all other determinations the Committee may deem necessary or advisable for the administration of the Plan. (c) Each Option or Award under this Plan shall be deemed to have been granted when the determination of the Committee with respect to such Option or Award is made or, if so determined by the Committee, at a specific future date. Once an Option has been granted, all conditions and requirements of this Plan with respect to such Option shall be deemed to be conditions upon the exercise of the Option but not upon the grant thereof. (d) Every action, decision, interpretation or determination by the Committee or the Board with respect to the application or administration of this Plan shall be final and binding upon the Company and each person holding or claiming any right or interest pursuant to any Option or Award granted under this Plan. (e) No member of the Committee or the Board shall be liable for any action or determination made in good faith with respect to this Plan or any Option or Award. To the full extent permitted by law, the Company shall indemnify and hold harmless each person made or threatened to be made a party to any civil or criminal action or proceeding by reason of the fact that such person, or such person's testator or intestate, is or was a member of the Committee. (f) In the event of a conflict between the terms of this Plan and the terms of any Agreement, the terms of this Plan, as determined by the Committee in its discretion, shall govern. 3. Stock Subject to this Plan (a) The shares of Common Stock to be issued upon exercise of Options or constituting Awards granted under this Plan shall be made available, at the discretion of the Board, either from the authorized but unissued shares of Common Stock or from shares of Common Stock reacquired by the Company, including shares purchased in the open market. The aggregate number of shares of Common Stock for which Options and Awards may be granted under this Plan shall not exceed 1,960,000. Such aggregate numbers shall be subject to adjustment as provided in paragraph 12. If any Option granted under this Plan shall expire or terminate for any reason without having been exercised in full, or if any Common Stock subject to an Award shall be forfeited, the unpurchased or forfeited shares shall (unless this Plan shall have been terminated) become available for grant of Options or Awards to other individuals. (b) A Grantee to whom an Award has been made shall have, after delivery to him of, or after notification that there is being held in custody for him, a certificate or certificates for the number of shares of Common Stock awarded, absolute ownership of such shares including the right to vote the same and to receive dividends thereon, subject however, to the terms, conditions and restrictions described in this Plan and in any Agreement relating to the Award. 4. Eligibility of Grantees Options and Awards may be granted under this Plan only as a material inducement to any individual who has neither been employed by SMSC nor served on the Board to become an employee of SMSC, including individuals who may become employees of SMSC in connection with a corporate transaction, provided, that an individual who has been employed by SMSC or served on the Board may also receive inducement grants of Options and/or Awards under this Plan following a bona fide break in employment and Board service, as determined under NASD Rule 4350(c) (each individual receiving an Option or Award, a "Grantee"). Options and Awards shall not become effective unless and until the Grantee actually commences employment with SMSC. Eligible individuals may receive grants of either or both Options and Awards. 5. Option Price The purchase price per share of Common Stock under each Option shall be established by the Committee, but shall not be less than the fair market value (as hereinafter defined) of a share of Common Stock on the date such Option is granted. 6. Restrictions (a) No Option granted under this Plan shall be transferable by the Grantee, either voluntarily or by operation of law, otherwise than by last will and testament or by laws of descent and distribution, and such Option shall be exercised during the lifetime of the Grantee, only by the Grantee, or by his or her guardian or legal representative. (b) Until the restrictions set forth in this paragraph 6(b) shall lapse pursuant to paragraph 6(c) or 6(d), shares of Common Stock awarded to a Grantee pursuant to an Award: (i) shall not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, and (ii) shall, if delivered to or to the order of the Grantee, be returned to the Company forthwith, and all rights of the Grantee to such shares shall immediately terminate without any payment of consideration by the Company, if the Grantee's continuous employment with the Company or any of its subsidiaries shall terminate for any reason, except as provided in paragraph 6(d); provided, however, that the Board shall have the right to waive such forfeiture, in whole or in part, and in connection with such waiver to impose any terms or restrictions on the continued ownership of such shares by the Grantee under the Plan. If the Grantee's interests in the shares of Common Stock granted pursuant to an Award shall be terminated pursuant to this clause (ii), the Grantee shall forthwith deliver to the Secretary or any Assistant Secretary of the Company the certificates for shares of Common Stock so terminated, accompanied by such instrument of transfer as may be required by the Secretary or any Assistant Secretary of the Company. (c) Unless the Committee shall fix a different schedule in an Agreement relating to an Award, except as set forth in paragraph 6(d), the restrictions set forth in paragraph 6(b) hereof shall lapse to the extent of 25% of the shares covered by the Award on each of the first and second anniversaries of the date of grant of such Award and as to the remaining 50% on the third anniversary of the date of grant. (d) Any provision of paragraph 6(b) hereof to the contrary notwithstanding, if a Grantee who has been in the continuous employment of the Company or of any subsidiary since the date on which an Award was granted to him shall, while in such employment, die, terminate employment by reason of disability as defined in this paragraph 6(d), or attain age 65, and any of such events shall occur more than one year after the date on which an Award shall have been granted to him, then the restrictions set forth in paragraph 6(b) hereof shall lapse, as to all shares of Common Stock awarded to such Grantee pursuant to such Award, on the date of such event. As used in this paragraph 6(d) the term "disability" shall mean a condition that is within the meaning of Section 22(e)(3) of the Code. (e) Each Grantee granted an Award shall agree that, subject to the provisions of paragraph 6(f): (i) no later than the date of the lapse of the restrictions mentioned in paragraph 6(b) hereof and in any Agreement respecting the Award, the Grantee will pay to the Company, or make arrangements satisfactory to the Committee regarding payment of, any federal, state or local withholding taxes of any kind required by law to be paid by the Company or its subsidiaries with respect to the shares of Common Stock subject to the Award, and (ii) the Company and its subsidiaries shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to the Grantee any federal, state or local taxes of any kind required by law to be withheld with respect to the shares of Common Stock subject to the Award. (f) If a Grantee granted an Award properly files with the Internal Revenue Service a written election within 30 days of the date of grant, to include in gross income for federal income tax purposes an amount equal to the fair market value of the shares of Common Stock awarded on the date of grant, the Grantee shall make arrangements satisfactory to the Committee to pay in the year of such grant any federal, state or local withholding taxes required to be paid by the Company or its subsidiaries with respect to such shares. If the Grantee shall fail to make such payments, the Company and its subsidiaries shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to the Grantee any federal, state or local taxes of any kind required by law to be withheld with respect to such shares of Common Stock. (g) Certificates evidencing shares of Common Stock subject to Awards shall bear an appropriate legend referring to the terms, conditions, and restrictions described in the Plan and in any Agreement relating to the Award. Any attempt to dispose of any such shares of Common Stock in contravention of the terms, conditions and restrictions described in the Plan or any related Agreement shall be ineffective. The shares acquired, together with stock powers (if required by the Company) or other instruments of transfer appropriately endorsed in blank by the Grantee, shall be held by the Company, for the use and benefit and subject to the rights of such Grantee as owner thereof. After the lapse of all restrictions with respect to particular shares, the Company shall deliver the certificates for such shares held by the Company to the Grantee concerned. 7. Exercise of Option (a) Each Option granted under this Plan shall by its terms expire not later than ten years from the date on which it was granted. (b) Unless the Committee shall fix a different schedule at the time a particular Option is granted, each Option granted under this Plan shall vest and become exercisable, as to 20% of the Common Stock subject to such Option on each of the first five anniversaries of the Option grant date, provided that the Grantee remains continuously employed by SMSC through each such vesting date. Notwithstanding the foregoing, the Committee may declare any outstanding Option immediately and fully vested and exercisable (but in no event prior to the first anniversary of the date of grant). (c) A Grantee electing to exercise an Option shall give written notice to the Company of such election and of the number of shares he or she has elected to purchase; provided that no Option may be exercised as to fewer than 100 shares unless it is then exercised as to all of the shares then purchasable thereunder. Such notice shall be accompanied by payment to the Company of the full purchase price in cash; provided that, unless otherwise determined by the Committee, the purchase price may be paid in whole or in part, by surrender or delivery to the Company of Common Stock of the Company having a fair market value on the date of exercise equal to the portion of the purchase price being so paid. In addition, a Grantee shall, upon notification of the amount due and prior to or concurrently with delivery to the Grantee of a certificate representing such shares, pay, in cash, any amount necessary to satisfy federal, state and local tax requirements. (d) No Grantee shall have the rights of a stockholder with respect to shares covered by an Option until such Grantee becomes the holder of record of such shares. (e) Except as provided in paragraph 8 or paragraph 9, no Option granted to a Grantee may be exercised, unless, at the time of exercise, the Grantee is an employee of the Company. Options granted under the Plan to a Grantee shall not be affected by any change of duties or position so long as the Grantee continues to be an employee of the Company. (f) Notwithstanding any other provision of this Plan, the Company shall not be required to issue or deliver any share of stock upon the exercise of an Option prior to (a) the admission of such share to listing on any stock exchange or automated quotation system on which the Company's Common Stock may then be listed and (b) the completion of such registration or other qualification of such share under any state or federal law, rule or regulation as the Company shall determine to be necessary or advisable. 8. Termination of Grantee's Relationship to the Company (a) In the case of an Option granted to a Grantee, if the Grantee shall cease to be an employee of the Company, other than by reason of death or permanent and total disability within the meaning of Section 22(e)(3) of the Code, any Option held by such Grantee may be exercised (to the extent that the Grantee was entitled to exercise such Option at the termination of such employment) at any time within three months after such termination, but not later than the expiration date of such Option; provided, however, that any Option held by a Grantee whose employment shall be terminated by the Company for cause shall, to the extent not theretofore exercised, forthwith terminate. (b) Notwithstanding the provisions of paragraph 7 specifying the installments in which an Option shall be vested and exercisable, in the case of an Option granted to a Grantee, unless the Committee specifies otherwise at the time a particular Option is granted, upon a Grantee's actual retirement at age 65 or thereafter, the Option shall be exercisable (within the time periods set forth in paragraph 8(a)) as to all shares of Common Stock remaining subject to the Option. (c) Any Agreement may contain such provisions as the Board shall approve with reference to the determination of the date employment terminates for purposes of the Plan (which provisions may allow periods of consultancy to be treated as periods of employment) and the effect of leaves of absence, which provisions may vary from one another. (d) In the case of an Option or Award granted to a Grantee whose employment relationship terminates prior to the applicable vesting date of such Option or Award but the Grantee continues to serve SMSC as a consultant, the Grantee's consultancy shall be treated as employment for purposes of this Plan. (e) Nothing in the Plan or in any Agreement shall confer upon any Grantee any right to continue in the employ of the Company or affect the right of the Company to terminate such employment relationship at any time for any reason, or for no reason. 9. Death or Disability of Grantee Notwithstanding the provisions of paragraph 7 specifying installments in which an Option shall be vested and exercisable, unless the Committee specifies otherwise at the time a particular Option is granted, if a Grantee shall die or become permanently and totally disabled within the meaning of Section 22(e)(3) of the Code, while he or she is employed by the Company or within three months after the termination of his or her employment (other than termination by the Company for cause), such Option may be exercised, as to all shares of Common Stock remaining subject to the Option, within the later to occur of (a) three months after the termination of the Grantee's employment or (b) thirty days after the appointment of a legal representative or guardian, but in no case more than one year after termination of employment and in no case after the original expiration date of the Option. 10. Amendments to the Plan The Board may at any time terminate or from time to time modify, amend or suspend this Plan, including any amendment for the purpose of complying with or securing the benefit of any change in the Exchange Act or the Code or any regulation adopted under either. No suspension, termination, modification or amendment of the Plan may, without the consent of the Grantee to whom an Option or Award shall theretofore have been granted, materially and adversely affect the rights of such Grantee under such Option or Award, provided, that SMSC shall have the right, in connection with a corporate transaction or otherwise, to terminate any or all Awards under this Plan at any time in exchange for cash or other consideration equal to the then-current fair value of any such Award and, with respect to each share underlying an Option, the excess, if any, of the fair market value per share over the exercise price per share, as determined in the sole discretion of the Committee, and no such termination shall constitute a material and adverse affect on the rights of any Grantee. 11. Granting of Options and Awards (a) The grant of any Option or Award pursuant to the Plan shall be entirely in the discretion of the Committee, and nothing in the Plan shall be construed to confer on any Grantee any right to receive any Option or Award under the Plan. (b) Subject to the terms, conditions and restrictions of the Plan, the Committee shall, in its sole discretion, select the Grantees to whom Options or Awards are to be granted without limiting the generality of Paragraph 2, the Committee shall also have power to determine (i) whether Options or Awards are to be made, (ii) the number of shares of Common Stock covered by each Option or Award, (iii) the time or times when Options or Awards will be made, and (iv) in accordance with paragraph 6, the restrictions applicable to shares of Common Stock awarded pursuant to Awards. (c) The grant of an Option or Award pursuant to the Plan shall not constitute an agreement or an understanding, express or implied, to employ the Grantee for any specified period. 12. Adjustments upon Changes in Capitalization (a) The Board may at any time make such provision as it shall consider appropriate for the adjustment of the number and class of shares covered by each Option or Award and the price as to which an Option shall be exercisable, in the event of changes in the outstanding Common Stock of the Company by reason of any stock dividend, split-up, reorganization, liquidation, and the like. In the event of any such change in the outstanding Common Stock of the Company, the aggregate number of shares as to which Options and Awards may be granted under the Plan shall be appropriately adjusted by the Board, whose determination shall be conclusive. No adjustment shall be made in the requirements set forth in paragraph 7 with respect to the minimum number of shares that must be purchased upon any exercise of an Option. (b) In the event (i) of a dissolution, liquidation, merger or consolidation of the Company or (ii) of a sale of all or substantially all of the assets of the Company or the sale of substantially all of the assets or stock of a subsidiary of which a Grantee is then an employee, or (iii) a change in control (as hereinafter defined) of the Company has occurred or is about to occur, then, the Board may determine that each Option and/or Award under the Plan, if such event shall occur with respect to the Company, or each Option granted to an employee of such subsidiary, shall become immediately and fully exercisable or that restrictions on shares subject to any Award shall immediately lapse. 13. Effectiveness of the Plan and Options and Awards; Termination of the Plan This Plan shall be effective as of the date that it receives Board approval, which shall be the date of the consummation of the transaction described in the Share Purchase Agreement by and among Standard Microsystems Corporation and the Shareholders of OASIS SiliconSystems Holding AG, dated as of March 30, 2005 (the "Effective Date"). No Option or Award under this Plan shall become effective until it has been approved by the Committee. No Options or Awards shall be made on or after the tenth anniversary of the Effective Date, provided, that any Options or Awards outstanding on the Effective Date shall continue to be governed by this Plan until they are terminated. 14. Severability In the event that any one or more provisions of the Plan or any Agreement, or any action taken pursuant to the Plan or such Agreement, should, for any reason, be unenforceable or invalid in any respect under the laws of the United States, any state of the United States or any other government, such unenforceability or invalidity shall not affect any other provision of the Plan or of such or any other Agreement, but in such particular jurisdiction and instance the Plan and the affected Agreement shall be construed as if such unenforceable or invalid provision had not been contained therein or as if the action in question had not been taken thereunder. 15. Effect on Prior Option and Award Plans The adoption of the 2005 Plan shall have no effect on outstanding Options or Awards granted by the Company under any other plan or agreement. 16. Notices All notices and other communications hereunder shall be in writing and shall be given and shall be deemed to have been duly given if delivered in person, by cable, telegram, telex or facsimile transmission, to the parties as follows: If to the Grantee, to the Grantee's last known address. If to the Company: Standard Microsystems Corporation Attention: Secretary 80 Arkay Drive Hauppauge, New York 11788 or to such other address as any party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall only be effective upon receipt. 17. Governing Law This Plan shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, without regard to the provisions governing conflict of laws. 18. Certain Definitions (a) The terms "parent" and "subsidiary" shall have the meanings respectively, of "parent corporation" and "subsidiary corporation" as set forth in Sections 424(e) and (f) of the Code, respectively. (b) The term "fair market value" of a share of Common Stock shall mean, as of the date on which such fair market value is to be determined, the closing price (or the average of the latest bid and asked prices) of a share of Common Stock as reported in The Wall Street Journal (or a publication or reporting service deemed equivalent to The Wall Street Journal for such purpose by the Board or the Committee) for the over-the-counter market or any national securities exchanges and other securities markets which at the time are included in the stock price quotations of such publication. (c) The term "termination of employment for cause" or words to like effect shall mean termination by the Company of the employment of the Grantee by reason of the Grantee's (i) willful refusal to perform his or her obligations to the Company, (ii) willful misconduct, contrary to the interests of the Company, or (iii) commission of a serious criminal act, whether denominated a felony, misdemeanor or otherwise. In the event of any dispute whether a termination for cause has occurred, the Board may by resolution resolve such dispute and such resolution shall be final and conclusive on all parties. (d) The term "Company" shall include SMSC and any parent or subsidiary of SMSC. (e) The term "change in control" shall mean an event or series of events that would be required to be described as a change in control of the Company on Form 8-K promulgated under the Exchange Act. The determination whether and when a change in control has occurred or is about to occur shall be made by vote of a majority of the Non-Employee Directors who shall have constituted the Board immediately prior to the occurrence of the event or series of events constituting such change in control. (f) The term "corporate transaction" shall mean any corporate event or transaction (including, but not limited to, a change in the shares of SMSC or the capitalization of SMSC) such as a merger, consolidation, reorganization, recapitalization, separation, stock dividend, stock split, reverse stock split, split up, spin-off, or other distribution of stock or property of SMSC, combination or exchange of shares of Common Stock, dividend in kind, extraordinary cash dividend or other change in capital structure or distribution (other than normal cash dividends) to shareholders of SMSC, or any similar corporate event. -----END PRIVACY-ENHANCED MESSAGE-----