Microchip Technology Issues New PSU & RSU Awards to CFO in Form 4

Rhea-AI Filing Summary

Microchip Technology Inc. (MCHP) – Form 4 insider filing dated 07/03/2025 discloses new equity awards to Senior Vice President & CFO James Eric Bjornholt.

• Derivative grants: • 2,747 Performance Stock Units (PSUs) and • 2,746 Restricted Stock Units (RSUs) were awarded on 07/01/2025 (Transaction Code “A”). No consideration was paid (exercise price $0).
• PSU structure: Payout is contingent on Microchip achieving a cumulative non-GAAP operating margin target of 29.0% over 12 quarters (ending 06/30/2028). The target share amount may scale up or down based on actual performance. Earned units vest 08/15/2029.
• RSU schedule: The 2,746 RSUs cliff-vest on 08/15/2029, subject to continued service.
• Ownership post-grant: After these transactions Mr. Bjornholt directly holds 2,747 PSUs and 2,746 RSUs, and indirectly holds 34,313 common shares in a trust.

No sales or dispositions were reported; therefore the filing represents long-term, performance-linked incentive compensation rather than an immediate change in insider shareholdings or liquidity.

Positive

• Performance-linked incentive structure: PSUs tied to 29% cumulative non-GAAP operating margin encourage long-term value creation.
• Long vesting horizon (2029) enhances executive retention and shareholder alignment.
• No insider selling; transaction is purely an equity grant, avoiding negative supply signal.

Negative

• Potential dilution, albeit <0.001% of shares outstanding, marginally increases share count.
• Five-year cliff vesting delays transparency of ultimate share issuance until 2029.

Insights

Corporate Governance Expert

TL;DR: Long-dated PSU/RSU award aligns CFO incentives with multi-year margin target; negligible dilution, neutral to mildly positive.

The grant ties compensation to a demanding 29% cumulative non-GAAP operating margin over three fiscal years, encouraging sustained profitability. Five-year cliff vesting (to 2029) strengthens retention. Because the award size is modest relative to Microchip’s ~545 million shares outstanding (<0.001%), dilution risk is immaterial. No shares were sold, so market supply is unaffected. From a governance view, the structure is shareholder-friendly and signals confidence in reaching long-term targets, warranting a slightly positive interpretation.

Portfolio Manager

TL;DR: New equity grants signal management commitment; impact on valuation negligible, sentiment modestly positive.

Insider awards with zero cash cost do not alter cash flows or immediate EPS. However, requiring a 29% non-GAAP margin over 12 quarters suggests management believes margins can remain elevated despite semiconductor cyclicality. The CFO’s indirect holding of 34k shares plus performance-tied units increases economic exposure, reducing agency risk. The five-year vesting horizon dovetails with typical investment timeframes, but given Microchip’s >$60 billion market cap, the transaction is not materially impactful. Overall, the filing is directionally positive for alignment but neutral for near-term stock price.

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

OMB APPROVAL

OMB Number:			3235-0287
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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

Check this box to indicate that a transaction was made pursuant to a contract, instruction or written plan for the purchase or sale of equity securities of the issuer that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c). See Instruction 10.

1. Name and Address of Reporting Person^*

Bjornholt James Eric

(Last) (First) (Middle)

C/O MICROCHIP TECHNOLOGY INCORPORATED

2355 WEST CHANDLER BOULEVARD

(Street)

CHANDLER AZ 85224-6199

(City) (State) (Zip)

2. Issuer Name and Ticker or Trading Symbol
MICROCHIP TECHNOLOGY INC [ MCHP ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

	Director		10% Owner
X	Officer (give title below)		Other (specify below)
	SENIOR VP AND CFO

3. Date of Earliest Transaction (Month/Day/Year)
07/01/2025

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Stock								34,313	I	Shares held Indirectly, by Trust.

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Performance Stock Units	(1)	07/01/2025		A		2,747		(2)	(2)	Common Stock	2,747	$0	2,747	D
Restricted Stock Units	(3)	07/01/2025		A		2,746		(4)	(4)	Common Stock	2,746	$0	2,746	D

Explanation of Responses:

1. Each performance stock unit represents a contingent right to receive one share of Microchip Technology Incorporated common stock.

2. Each Performance Stock Unit (PSU) granted under the Microchip Technology Incorporated (Microchip) 2004 Equity Incentive Plan represents a contingent right to receive shares of Microchip common stock based on Microchip's cumulative non-GAAP operating margin over a period of 12 quarters ending June 30, 2028. The target number of PSU shares that may be earned is reported in the table above and is based on Microchip achieving a cumulative non-GAAP operating margin of 29.0% over the 12 quarter measurement period. The actual number of shares that may be earned can be higher or lower than the target depending on Microchip's non-GAAP operating margin over the measurement period. Earned PSUs will vest on August 15, 2029 as long as the reporting person remains a service provider through the vesting date. Vested shares will be delivered to the reporting person upon vest.

3. Each restricted stock unit represents a contingent right to receive one share of Microchip Technology Incorporated common stock.

4. The restricted stock units will vest in full on August 15, 2029 as long as the individual remains a service provider through the vesting date. Vested shares will be delivered to the reporting person upon vest.

Remarks:

	Deborah L. Wussler, as Attorney-in-Fact	07/03/2025
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
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FAQ

What insider activity did Microchip Technology (MCHP) report on 07/03/2025?

CFO James Eric Bjornholt received 2,747 PSUs and 2,746 RSUs; no shares were sold.

How many shares does the CFO now indirectly own?

34,313 common shares are held in a trust after the reported transaction.

What performance metric governs the PSUs for MCHP?

Payout depends on achieving a 29% cumulative non-GAAP operating margin over 12 quarters ending 06/30/2028.

When do the newly granted RSUs and PSUs vest?

Both awards fully vest on 08/15/2029, subject to continued employment.

Is the Form 4 transaction dilutive to existing shareholders?

Dilution is minimal (about 0.001% of shares outstanding), posing negligible impact on EPS.