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Sample Business Contracts

1997 Employee Stock Purchase Plan - Artisan Components Inc.

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                           ARTISAN COMPONENTS, INC.

                       1997 EMPLOYEE STOCK PURCHASE PLAN


     The following constitute the provisions of the 1997 Employee Stock Purchase
Plan of Artisan Components, Inc.

     1.   Purpose.  The purpose of the Plan is to provide employees of the
          -------                                                         
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company through accumulated payroll deductions.  It is the
intention of the Company to have the Plan qualify as an "Employee Stock Purchase
Plan" under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

     2.   Definitions.
          ----------- 

          (a) "Board" shall mean the Board of Directors of the Company.
               -----                                                   

          (b) "Committee" shall mean the committee designated by the Board in
               ---------                                                     
accordance with Section 14 of the Plan.  If at any time as Committee shall be in
office, then the functions of the Committee specified in the Plan shall be
exercised by the Board and any references herein to the Committee shall be
construed as references to the Board.

          (c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
               ----                                                           

          (d) "Common Stock" shall mean the Common Stock of the Company.
               ------------                                             

          (e) "Company" shall mean Artisan Components, Inc. and any Designated
               -------                                                        
Subsidiary of the Company.

          (f) "Compensation" shall mean all W-2 compensation of the participant.
               ------------                                                     

          (g) "Designated Subsidiary" shall mean any Subsidiary which has been
               ---------------------                                          
designated by the Board from time to time in its sole discretion as eligible to
participate in the Plan.

          (h) "Employee" shall mean any individual who is an Employee of the
               --------                                                     
Company for tax purposes whose customary employment with the Company is at least
twenty (20) hours per week and more than five (5) months in any calendar year.
For purposes of the Plan, the employment relationship shall be treated as
continuing intact while the individual is on sick leave or other leave of
absence approved by the Company.  Where the period of leave exceeds 90 days and
the individual's right to reemployment is not guaranteed either by statute or by
contract, the employment relationship shall be deemed to have terminated on the
91st day of such leave.

          (i) "Enrollment Date" shall mean the first day of each Offering
               ---------------                                           
Period.
<PAGE>
 
          (j) "Exercise Date" shall mean the last trading day of each Purchase
               -------------                                                  
Period.

          (k) "Fair Market Value" shall mean, as of any date, the value of
              -----------------                                          
Common Stock determined as follows:

              (1) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system for
the last market trading day on the date of such determination, as reported in
The Wall Street Journal or such other source as the Committee deems reliable,
or;

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

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

              (4) For purposes of the Enrollment Date of the first Offering
Period under the Plan, the Fair Market Value shall be the initial price to the
public as set forth in the final Prospectus included within the Registration
Statement on Form S-1 filed with the Securities and Exchange Commission for the
initial public offering of the Company's Common Stock (the "Registration
Statement").

          (l) "Offering Periods" shall mean the periods of approximately twenty-
               ----------------                                                
four (24) months during which an option granted pursuant to the Plan may be
exercised, commencing on the first Trading Day on or after February 1 and August
1 of each year and terminating on the last Trading Day in the periods ending
twenty-four months later; provided, however, that the first Offering Period
under the Plan shall commence with the first Trading Day on or after the date on
which the Securities and Exchange Commission declares the Company's Registration
Statement effective and ending on the last Trading Day on or before January 31,
2000.  The duration and timing of Offering Periods may be changed pursuant to
Section 4 of this Plan.

          (m) "Plan" shall mean this Employee Stock Purchase Plan.
               ----                                               

          (n) "Purchase Price" shall mean an amount equal to 85% of the Fair
               --------------                                               
Market Value of a share of Common Stock on the Enrollment Date or on the
Exercise Date, whichever is lower.

          (o) "Purchase Period" shall mean the approximately six month period
               ---------------                                               
commencing after one Exercise Date and ending with the next Exercise Date,
except that the first Purchase Period of any Offering Period shall commence on
the Enrollment Date and end with the next Exercise Date.

                                      -2-
<PAGE>
 
          (p) "Reserves" shall mean the number of shares of Common Stock covered
               --------                                                         
by each option under the Plan which have not yet been exercised and the number
of shares of Common Stock which have been authorized for issuance under the Plan
but not yet placed under option.

          (q) "Subsidiary" shall mean a corporation, domestic or foreign, of
               ----------                                                   
which not less than 50% of the voting shares are held by the Company or a
Subsidiary, whether or not such corporation now exists or is hereafter organized
or acquired by the Company or a Subsidiary.

          (r) "Trading Day" shall mean a day on which national stock exchanges
               -----------                                                    
and the Nasdaq System are open for trading.

     3.   Eligibility.
          ----------- 

          (a) Any Employee (as defined in Section 2(h)) who shall be employed by
the Company immediately preceding a given Enrollment Date shall be eligible to
participate in the Plan. Notwithstanding the foregoing, however, any Employee
shall be eligible to participate in the Plan who was employed by the Company as
of the effective date of a registration statement filed with the Securities and
Exchange Commission for the initial offering of shares of Common Stock of the
Company to the public.

          (b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) to the extent that,
immediately after the grant, such Employee (or any other person whose stock
would be attributed to such Employee pursuant to Section 424(d) of the Code)
would own capital stock of the Company and/or hold outstanding options to
purchase such stock possessing five percent (5%) or more of the total combined
voting power or value of all classes of the capital stock of the Company or of
any Subsidiary, or (ii) to the extent that his or her rights to purchase stock
under all employee stock purchase plans of the Company and its subsidiaries
accrues at a rate which exceeds Twenty-Five Thousand Dollars ($25,000) worth of
stock (determined at the fair market value of the shares at the time such option
is granted) for each calendar year in which such option is outstanding at any
time.

     4.   Offering Periods.  The Plan shall be implemented by consecutive,
          ----------------                                                
overlapping Offering Periods with a new Offering Period commencing on the first
Trading Day on or after February 1 and August 1 each year, or on such other date
as the Board shall determine, and continuing thereafter until terminated in
accordance with Section 20 hereof; provided, however, that the first Offering
Period under the Plan shall commence with the first Trading Day on or after the
date on which the Securities and Exchange Commission declares the Company's
Registration Statement effective and ending on the last Trading Day on or before
January 31, 2000.   The Board shall have the power to change the duration of
Offering Periods (including the commencement dates thereof) with respect to
future offerings without shareholder approval if such change is announced at
least five (5) days prior to the scheduled beginning of the first Offering
Period to be affected thereafter.

                                      -3-
<PAGE>
 
     5.   Participation.
          ------------- 

          (a) An eligible Employee may become a participant in the Plan by
completing a subscription agreement authorizing payroll deductions in the form
of Exhibit A to this Plan and filing it with the Company's payroll office prior
to the applicable Enrollment Date.

          (b) Payroll deductions for a participant shall commence on the first
payroll following the Enrollment Date and shall end on the last payroll in the
Offering Period to which such authorization is applicable, unless sooner
terminated by the participant as provided in Section 10 hereof.

     6.   Payroll Deductions.
          ------------------ 

          (a)   At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay day
during the Offering Period in an amount not exceeding fifteen percent (15%) of
the Compensation which he or she receives on each pay day during the Offering
Period.
                  
          (b) All payroll deductions made for a participant shall be credited to
his or her account under the Plan and shall be withheld in whole percentages
only.  A participant may not make any additional payments into such account.
                     
          (c) A participant may discontinue his or her participation in the Plan
as provided in Section 10 hereof, or may increase or decrease the rate of his or
her payroll deductions during the Offering Period by completing or filing with
the Company a new subscription agreement authorizing a change in payroll
deduction rate.  The Committee may, in its discretion, limit the number of
participation rate changes during any Offering Period.  The change in rate shall
be effective with the first full payroll period following five (5) business days
after the Company's receipt of the new subscription agreement unless the Company
elects to process a given change in participation more quickly.  A participant's
subscription agreement shall remain in effect for successive Offering Periods
unless terminated as provided in Section 10 hereof.

          (d) Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and Section 3(b) hereof, a participant's
payroll deductions may be decreased to zero percent (0%) at any time during a
Purchase Period.  Payroll deductions shall recommence at the rate provided in
such participant's subscription agreement at the beginning of the first Purchase
Period which is scheduled to end in the following calendar year, unless
terminated by the participant as provided in Section 10 hereof.

          (e) At the time the option is exercised, in whole or in part, or at
the time some or all of the Company's Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company's
federal, state, or other tax withholding obligations, if any, which arise upon
the exercise of the option or the disposition of the Common Stock.  At any time,
the Company may, but will not be obligated to, withhold from the participant's
compensation the amount necessary 

                                      -4-
<PAGE>
 
for the Company to meet applicable withholding obligations, including any
withholding required to make available to the Company any tax deductions or
benefits attributable to sale or early disposition of Common Stock by the
Employee.

     7.   Grant of Option.  On the Enrollment Date of each Offering Period, each
          ---------------                                                       
eligible Employee participating in such Offering Period shall be granted an
option to purchase on each Exercise Date during such Offering Period (at the
applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated
prior to such Exercise Date and retained in the Participant's account as of the
Exercise Date by the applicable Purchase Price; provided that in no event shall
an Employee be permitted to purchase during each Purchase Period more than a
number of shares determined by dividing $12,500 by the Fair Market Value of a
share of the Company's Common Stock (subject to any adjustment pursuant to
Section 19) on the Enrollment Date, and provided further that such purchase
shall be subject to the limitations set forth in Sections 3(b) and 12 hereof.
Exercise of the option shall occur as provided in Section 8 hereof, unless the
participant has withdrawn pursuant to Section 10 hereof.  The option shall
expire on the last day of the Offering Period.

     8.   Exercise of Option.  Unless a Participant withdraws from the Plan as
          ------------------                                                  
provided in Section 10 hereof, his or her option for the purchase of shares will
be exercised automatically on the Exercise Date, and the maximum number of full
shares subject to option shall be purchased for such participant at the
applicable Purchase Price with the accumulated payroll deductions in his or her
account.  No fractional shares shall be purchased; any payroll deductions
accumulated in a Participant's account which are not sufficient to purchase a
full share will be retained in the Participant's account for the subsequent
Purchase Period or Offering Period, subject to earlier withdrawal by the
participant as provided in Section 10 hereof.  Any other monies left over in a
participant's account after the Exercise Date shall be returned to the
participant.  During a participant's lifetime, a Participant's option to
purchase shares hereunder is exercisable only by him or her.

     9.   Delivery.  As promptly as practicable after each Exercise Date on
          --------                                                         
which a purchase of shares occurs, the Company shall arrange the delivery to
each participant, as appropriate, of a certificate representing the shares
purchased upon exercise of his or her option.

     10.  Withdrawal.
          ---------- 

          (a) A participant may withdraw all but not less than all the payroll
deductions credited to his or her account and not yet used to exercise his or
her option under the Plan at any time by giving written notice to the Company in
the form of Exhibit B to this Plan.  All of the participant's payroll deductions
credited to his or her account shall be paid to such participant promptly after
receipt of notice of withdrawal and such participant's option for the Offering
Period shall be automatically terminated, and no further payroll deductions for
the purchase of shares shall be made for such Offering Period.  If a participant
withdraws from an Offering Period, payroll deductions shall not resume at the
beginning of the succeeding Offering Period unless the participant delivers to
the Company a new subscription agreement.

                                      -5-
<PAGE>
 
          (b) A participant's withdrawal from an Offering Period shall not have
any effect upon his or her eligibility to participate in any similar plan which
may hereafter be adopted by the Company or in succeeding Offering Periods which
commence after the termination of the Offering Period from which the participant
withdraws.

     11.  Termination of Employment.
          ------------------------- 

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

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

     13.  Stock.
          ----- 

          (a) Subject to Section19, the maximum number of shares of the
Company's Common Stock which shall be made available for sale under the Plan
shall be six hundred thousand (600,000) shares (after giving effect to the one-
for-two reverse stock split approved by the shareholders on November 24, 1997),
together with  an annual increase to the number of shares reserved thereunder on
each anniversary date of the adoption of the Plan equal to the lesser of (i)
200,000 shares (post-split), (ii) one percent of the outstanding shares of the
Company on such date or (iii) a lesser amount determined by the Board.  If, on a
given Exercise Date, the number of shares with respect to which options are to
be exercised exceeds the number of shares then available under the Plan, the
Company shall make a pro rata allocation of the shares remaining available for
purchase in as uniform a manner as shall be practicable and as it shall
determine to be equitable.

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

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

     14.  Administration.
          -------------- 

          (a) Administrative Body.  The Plan shall be administered by the Board
              -------------------                                              
or a committee of members of the Board appointed by the Board.  The Board or its
Committee shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan.  Every finding, decision
and determination 

                                      -6-
<PAGE>
 
made by the Board or its Committee shall, to the full extent permitted by law,
be final and binding upon all parties.

          (b) Rule 16b-3 Limitations.  Notwithstanding the provisions of
              ----------------------                                    
Subsection (a) of this Section 14, in the event that Rule 16b-3 promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
any successor provision ("Rule 16b-3") provides specific requirements for
administrators of plans of this type, the Plan shall be only administered by
such a body and in such a manner as shall comply with the applicable
requirements of Rule 16b-3.  Unless permitted by Rule 16b-3, no discretion
concerning decisions regarding the Plan shall be afforded to any committee or
person that is not "disinterested" as that term is used in Rule 16b-3.

     15.  Designation of Beneficiary.
          -------------------------- 

          (a) A participant may file a written designation of a beneficiary who
is to receive any shares and cash, if any, from the participant's account under
the Plan in the event of such participant's death subsequent to an Exercise Date
on which the option is exercised but prior to delivery to such participant of
such shares and cash.  In addition, a participant may file a written designation
of a beneficiary who is to receive any cash from the participant's account under
the Plan in the event of such participant's death prior to exercise of the
option.  If a participant is married and the designated beneficiary is not the
spouse, spousal consent shall be required for such designation to be effective.

          (b) Such designation of beneficiary may be changed by the participant
at any time by written notice.  In the event of the death of a participant and
in the absence of a beneficiary validly designated under the Plan who is living
at the time of such participant's death, the Company shall deliver such shares
and/or cash to the executor or administrator of the estate of the participant,
or if no such executor or administrator has been appointed (to the knowledge of
the Company), the Company, in its discretion, may deliver such shares and/or
cash to the spouse or to any one or more dependents or relatives of the
participant, or if no spouse, dependent or relative is known to the Company,
then to such other person as the Company may designate.

     16.  Transferability.  Neither payroll deductions credited to a
          ---------------                                           
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 15 hereof) by the participant.  Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.

     17.  Use of Funds.  All payroll deductions received or held by the Company
          ------------                                                         
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.

     18.  Reports.  Individual accounts shall be maintained for each participant
          -------                                                               
in the Plan. Statements of account shall be given to participating Employees at
least annually, which statements shall

                                      -7-
<PAGE>
 
set forth the amounts of payroll deductions, the Purchase Price, the number of
shares purchased and the remaining cash balance, if any.

     19.  Adjustments Upon Changes in Capitalization, Dissolution, Liquidation,
          ---------------------------------------------------------------------
          Merger or Asset Sale.
          -------------------- 

          (a) Changes in Capitalization.  Subject to any required action by the
              -------------------------                                        
shareholders of the Company, the Reserves, the maximum number of shares each
participant may purchase each Purchase Period (pursuant to Section 7), as well
as the price per share and the number of shares of Common Stock covered by each
option under the Plan which has not yet been exercised shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration".  Such adjustment shall be made by the
Committee, whose determination in that respect shall be final, binding and
conclusive.  Except as expressly provided herein, no issuance by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock subject to an option.

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

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

                                      -8-
<PAGE>
 
     20.  Amendment or Termination.
          ------------------------ 

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

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

     21.  Notices.  All notices or other communications by a participant to the
          -------                                                              
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.

     22.  Conditions Upon Issuance of Shares.  Shares shall not be issued with
          ----------------------------------                                  
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

          As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.

                                      -9-
<PAGE>
 
     23.  Term of Plan.  The Plan shall become effective upon the earlier to
          ------------                                                      
occur of its adoption by the Board of Directors or its approval by the
shareholders of the Company.  It shall continue in effect for a term of ten (10)
years unless sooner terminated under Section 20 hereof.

     24.  Automatic Transfer to Low Price Offering Period.  To the extent
          -----------------------------------------------                
permitted by any applicable laws, regulations, or stock exchange rules if the
Fair Market Value of the Common Stock on any Exercise Date in an Offering Period
is lower than the Fair Market Value of the Common Stock on the Enrollment Date
of such Offering Period, then all participants in such Offering Period shall be
automatically withdrawn from such Offering Period immediately after the exercise
of their option on such Exercise Date and automatically re-enrolled in the
immediately following Offering Period as of the first day thereof.

                                      -10-
<PAGE>
 
                                   EXHIBIT A
                                   ---------


                           ARTISAN COMPONENTS, INC.

                       1997 EMPLOYEE STOCK PURCHASE PLAN

                            SUBSCRIPTION AGREEMENT



_____ Original Application              Enrollment Date: ___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)


1.   _____________________________________________________ hereby elects to
     participate in the Artisan Components, Inc. 1997 Employee Stock Purchase
     Plan (the "Employee Stock Purchase Plan") and subscribes to purchase shares
     of the Company's Common Stock in accordance with this Subscription
     Agreement and the Employee Stock Purchase Plan.

2.   I hereby authorize payroll deductions from each paycheck in the amount of
     ____% of my Compensation on each payday (from 1 to _____%) during the
     Offering Period in accordance with the Employee Stock Purchase Plan.
     (Please note that no fractional percentages are permitted.)

3.   I understand that said payroll deductions shall be accumulated for the
     purchase of shares of Common Stock at the applicable Purchase Price
     determined in accordance with the Employee Stock Purchase Plan.  I
     understand that if I do not withdraw from an Offering Period, any
     accumulated payroll deductions will be used to automatically exercise my
     option.

4.   I have received a copy of the complete Employee Stock Purchase Plan.  I
     understand that my participation in the Employee Stock Purchase Plan is in
     all respects subject to the terms of the Plan. I understand that my ability
     to exercise the option under this Subscription Agreement is subject to
     shareholder approval of the Employee Stock Purchase Plan.

5.   Shares purchased for me under the Employee Stock Purchase Plan should be
     issued in the name(s) of (Employee or Employee and Spouse only):
     ___________________________________________________________________________
     ___________.

6.   I understand that if I dispose of any shares received by me pursuant to the
     Plan within 2 years after the Enrollment Date (the first day of the
     Offering Period during which I purchased such shares) or one year after the
     Exercise Date, I will be treated for federal income tax purposes as having
     received ordinary income at the time of such disposition in an amount equal
     to the excess of the fair market value of the shares at the time such
     shares were purchased by me over the price which I paid for the shares.  I
                                                                              -
     hereby agree to notify the Company in writing within 30 days after
     ---------------------------------------------------------------------------
<PAGE>
 
     the date of any disposition of my shares and I will make adequate provision
     ---------------------------------------------------------------------------
     for Federal, state or other tax withholding obligations, if any, which
     ---------------------------------------------------------------------------
     arise upon the disposition of the Common Stock. The Company may, but will
     -----------------------------------------------
     not be obligated to, withhold from my compensation the amount necessary to
     meet any applicable withholding obligation including any withholding
     necessary to make available to the Company any tax deductions or benefits
     attributable to sale or early disposition of Common Stock by me. If I
     dispose of such shares at any time after the expiration of the 2-year and
     1-year holding periods, I understand that I will be treated for federal
     income tax purposes as having received income only at the time of such
     disposition, and that such income will be taxed as ordinary income only to
     the extent of an amount equal to the lesser of (1) the excess of the fair
     market value of the shares at the time of such disposition over the
     purchase price which I paid for the shares, or (2) 15% of the fair market
     value of the shares on the first day of the Offering Period. The remainder
     of the gain, if any, recognized on such disposition will be taxed as
     capital gain.

7.   I hereby agree to be bound by the terms of the Employee Stock Purchase
     Plan.  The effectiveness of this Subscription Agreement is dependent upon
     my eligibility to participate in the Employee Stock Purchase Plan.

8.   In the event of my death, I hereby designate the following as my
     beneficiary(ies) to receive all payments and shares due me under the
     Employee Stock Purchase Plan:


NAME:  (Please print)______________________________________________
                      (First)         (Middle)               (Last)


_____________________________    _____________________________________________
Relationship

                                 _____________________________________________
                                 (Address)

                                       2
<PAGE>
 
Employee's Social
Security Number:                    ____________________________________



Employee's Address:                 ____________________________________

                                    ____________________________________
   
                                    ____________________________________


I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.



Dated:_________________________    ________________________________________
                                   Signature of Employee


                                   _______________________________________
                                   Spouse's Signature (If beneficiary other than
                                    spouse)

                                      -3-
<PAGE>
 
                                   EXHIBIT B
                                   ---------


                            ARTISAN COMPONENTS, INC.

                       1997 EMPLOYEE STOCK PURCHASE PLAN

                              NOTICE OF WITHDRAWAL



     The undersigned participant in the Offering Period of the Artisan
Components, Inc. 1997 Employee Stock Purchase Plan which began on ____________,
19____ (the "Enrollment Date") hereby notifies the Company that he or she hereby
withdraws from the Offering Period.  He or she hereby directs the Company to pay
to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The
undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated.  The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period and the undersigned shall be eligible to participate
in succeeding Offering Periods only by delivering to the Company a new
Subscription Agreement.

                                    Name and Address of Participant:

                                    ________________________________
                                    ________________________________
                                    ________________________________


                                    Signature:


                                    ________________________________


                                    Date:__________________________