EXHIBIT 10-j-2
CONEXANT SYSTEMS, INC.
2004 NEW-HIRE EQUITY INCENTIVE PLAN
STOCK OPTION AGREEMENT
(NONSTATUTORY STOCK OPTION)
Pursuant to your Stock Option Grant Notice ("Grant Notice"), this Stock
Option Agreement and, if applicable, the Additional Terms and Conditions for
Non-U.S. Employees, Conexant Systems, Inc. (the "Company") has granted you an
option under its 2004 New-Hire Equity Incentive Plan (the "Plan") to purchase
the number of shares of the Company's Common Stock indicated in your Grant
Notice at the exercise price indicated in your Grant Notice. Defined terms not
explicitly defined in this Stock Option Agreement but defined in the Plan shall
have the same definitions as in the Plan.
The details of your option are as follows:
1. VESTING. Subject to the limitations contained herein, your option will
vest as provided in your Grant Notice, provided that vesting will cease upon the
termination of your Continuous Service, and provided further that if the
termination of your Continuous Service is due to your death, then your option
will immediately vest in full upon such event.
2. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common
Stock subject to your option and your exercise price per share referenced in
your Grant Notice may be adjusted from time to time for Capitalization
Adjustments.
3. METHOD OF PAYMENT. Payment of the exercise price is due in full upon
exercise of all or any part of your option. You may elect to make payment of the
exercise price in cash or by check or in any other manner PERMITTED BY YOUR
GRANT NOTICE, which may include one or more of the following:
(a) In the Company's sole discretion at the time your option is
exercised and provided that at the time of exercise the Common Stock is publicly
traded, pursuant to a "cashless exercise" program developed under Regulation T
as promulgated by the Federal Reserve Board that, prior to the issuance of
Common Stock, results in either the receipt of cash (or check) by the Company or
the receipt of irrevocable instructions to pay the aggregate exercise price to
the Company from the sales proceeds.
(b) Provided that at the time of exercise the Common Stock is
publicly traded, by delivery of already-owned shares of Common Stock either that
you have held for the period required to avoid a charge to the Company's
reported earnings (generally six (6) months) or that you did not acquire,
directly or indirectly from the Company, that are owned free and clear of any
liens, claims, encumbrances or security interests, and that are valued at Fair
Market Value on the date of exercise. "Delivery" for these purposes, in the sole
discretion of the Company at the time you exercise your option, shall include
delivery to the Company of your attestation of ownership of such shares of
Common Stock in a form approved by the Company. Notwithstanding the foregoing,
you may not exercise your option by tender to the Company of
2004 NHSP T&C 03-05-04
1
Common Stock to the extent such tender would violate the provisions of any law,
regulation or agreement restricting the redemption of the Company's stock.
4. WHOLE SHARES. You may exercise your option only for whole shares of
Common Stock.
5. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option also must comply
with other applicable laws and regulations governing your option, and you may
not exercise your option if the Company determines that such exercise would not
be in material compliance with such laws and regulations.
6. TERM. You may not exercise your option before the commencement or after
the expiration of its term. The term of your option commences on the Date of
Grant and expires upon the earliest of the following:
(a) as of the date of the termination of your Continuous Service if
such termination is for Cause;
(b) three (3) months after the termination of your Continuous
Service for any reason (including your Disability) other than for Cause or
death, provided that if during any part of such three (3) month period your
option is not exercisable solely because of the condition set forth in Section
5, your option shall not expire until the earlier of the Expiration Date or
until it shall have been exercisable for an aggregate period of three (3) months
after the termination of your Continuous Service;
(c) thirty-six (36) months after your death if you die either during
your Continuous Service;
(d) the Expiration Date indicated in your Grant Notice; or
(e) the day before the eighth (8th) anniversary of the Date of
Xxxxx.
7. EXERCISE.
(a) You may exercise the vested portion of your option (and the
unvested portion of your option if your Grant Notice so permits) during its term
by contacting Mellon Investor Services LLC by using the Integrated Voice
Response system that is used to facilitate stock option transactions or the
Mellon Employee ServiceDirect System that is used to facilitate stock option
transactions and is accessible through Conexant NextWeb and tendering the
exercise price (both in such manner as is designated by the Company and
communicated to you), together with such additional documents as the Company may
then require.
(b) By exercising your option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the
2004 NHSP T&C 03-05-04
2
payment by you to the Company of any tax withholding obligation of the Company
arising by reason of (1) the exercise of your option, (2) the lapse of any
substantial risk of forfeiture to which the shares of Common Stock are subject
at the time of exercise, or (3) the disposition of shares of Common Stock
acquired upon such exercise.
8. TRANSFERABILITY. Your option is not transferable by you other than by
(a) will, (b) the laws of descent and distribution, or (c) upon dissolution of
your marriage pursuant to a U.S. domestic relations order. Also, during your
lifetime, only you are entitled to exercise your option. Notwithstanding the
foregoing, by delivering written notice to the Company, in a form satisfactory
to the Company, you may designate a third party who, in the event of your death,
shall thereafter be entitled to exercise your option.
9. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or
service contract, and nothing in your option shall be deemed to create in any
way whatsoever any obligation on your part to continue in the employ of the
Company or an Affiliate, or of the Company or an Affiliate to continue your
employment. In addition, nothing in your option shall obligate the Company or an
Affiliate, their respective stockholders, Boards of Directors, Officers or
Employees to continue any relationship that you might have as a Director or
Consultant for the Company or an Affiliate.
10. WITHHOLDING OBLIGATIONS.
(a) At the time you exercise your option, in whole or in part, or at
any time thereafter as requested by the Company, you hereby authorize
withholding from payroll and any other amounts payable to you, and otherwise
agree to make adequate provision for (including by means of a "cashless
exercise" pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board to the extent permitted by the Company), any sums
required to satisfy the federal, state, local and foreign tax withholding
obligations of the Company or an Affiliate, if any, which arise in connection
with the exercise of your option.
(b) Upon your request and subject to approval by the Company, in its
sole discretion, and compliance with any applicable legal conditions or
restrictions, the Company may withhold from fully vested shares of Common Stock
otherwise issuable to you upon the exercise of your option a number of whole
shares of Common Stock having a Fair Market Value, determined by the Company as
of the date of exercise, not in excess of the minimum amount of tax required to
be withheld by law (or such lower amount as may be necessary to avoid variable
award accounting). Any adverse consequences to you arising in connection with
such share withholding procedure shall be your sole responsibility.
(c) You may not exercise your option unless the tax withholding
obligations of the Company and/or any Affiliate are satisfied. Accordingly, you
may not be able to exercise your option when desired even though your option is
vested, and the Company shall have no obligation to issue a certificate for such
shares of Common Stock or release such shares of Common Stock from any escrow
provided for herein unless such obligations are satisfied.
11. NOTICES. Any notices provided for in your option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the
case of notices delivered by
2004 NHSP T&C 03-05-04
3
mail by the Company to you, five (5) days after deposit in the United States
mail, postage prepaid, addressed to you at the last address you provided to the
Company.
12. GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option, and
is further subject to all interpretations, amendments, rules and regulations,
which may from time to time be promulgated and adopted pursuant to the Plan. In
the event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.
2004 NHSP T&C 03-05-04
4
This Page Is Intentionally Blank
2004 NHSP T&C 03-05-04
CONEXANT SYSTEMS, INC.
2004 NEW-HIRE EQUITY INCENTIVE PLAN
ADDITIONAL TERMS AND CONDITIONS FOR NON-U.S. EMPLOYEES
Pursuant to your Stock Option Grant Notice ("Grant Notice") and the Stock
Option Agreement, Conexant Systems, Inc. (the "Company") has granted you an
option under its 2004 New-Hire Equity Incentive Plan (the "Plan") to purchase
the number of shares of the Company's Common Stock indicated in your Grant
Notice at the exercise price indicated in your Grant Notice.
Because you are an Employee of the Company or one of its Affiliates
residing outside the U.S., these Additional Terms and Conditions for Non-U.S.
Employees also govern your option granted to you under the Plan. In the event of
any conflict between the provisions of the Grant Notice or Stock Option
Agreement and these Additional Terms and Conditions for Non-U.S. Employees, the
provisions of these Additional Terms and Conditions for Non-U.S. Employees shall
prevail.
Defined terms not explicitly defined in these Additional Terms and
Conditions for Non-U.S. Employees but defined in the Plan shall have the same
definitions as in the Plan.
1. NATURE OF GRANT. In accepting the grant of your option, you acknowledge
that:
(a) the Plan is established voluntarily by the Company, it is
discretionary in nature and it may be modified, amended, suspended or terminated
by the Company at any time, unless otherwise provided in the Plan and in the
Stock Option Agreement;
(b) the grant of the option is voluntary and occasional and does not
create any contractual or other right to receive future grants of options, or
benefits in lieu of options, even if options have been granted repeatedly in the
past;
(c) all decisions with respect to future option grants, if any, will
be at the sole discretion of the Company;
(d) you are voluntarily participating in the Plan;
(e) the option is an extraordinary item that does not constitute
compensation of any kind for services of any kind rendered to the Company or
your employer, and which is outside the scope of your employment contract, if
any;
(f) the option is not part of normal or expected compensation or
salary for any purposes, including, but not limited to, calculating any
severance, resignation, termination, redundancy, end of service payments,
bonuses, long-service awards, pension or retirement benefits or similar
payments;
2004 NHSP T&C 03-05-04
A-1
(g) in the event that you are not an Employee of the Company, the
option grant will not be interpreted to form an employment contract or
relationship with the Company;
(h) the future value of the underlying shares of Common Stock is
unknown and cannot be predicted with certainty;
(i) if the underlying shares of Common Stock do not increase in
value, the option will have no value;
(j) if you exercise your option and obtain shares of Common Stock,
the value of those shares of Common Stock acquired upon exercise may increase or
decrease in value, even below the exercise price;
(k) in consideration of the grant of your option, no claim or
entitlement to compensation or damages shall arise from termination of the
option or diminution in value of the option or shares of Common Stock purchased
through exercise of the option resulting from termination of your Continuous
Service by the Company or your employer (for any reason whatsoever and whether
or not in breach of local labor laws) and you irrevocably release the Company
and your employer from any such claim that may arise; if, notwithstanding the
foregoing, any such claim is found by a court of competent jurisdiction to have
arisen, then you shall be deemed irrevocably to have waived your entitlement to
pursue such claim; and
(l) notwithstanding any terms or conditions of the Plan to the
contrary, in the event of termination of your Continuous Service (whether or not
in breach of local labor laws), your right to vest in your option under the
Plan, if any, will terminate effective as of the date that you are no longer
actively employed and will not be extended by any notice period mandated under
local law (e.g., active employment would not include a period of "garden leave"
or similar period pursuant to local law); furthermore, in the event of
termination of your Continuous Service (whether or not in breach of local labor
laws), your right to exercise your option after termination of Continuous
Service, if any, will be measured by the date of termination of your active
employment and will not be extended by any notice period mandated under local
law; the Board of Directors or the Committee shall have the exclusive discretion
to determine when you are no longer actively employed for purposes of your
option grant.
2. DATA PRIVACY.
(a) YOU HEREBY EXPLICITLY AND UNAMBIGUOUSLY CONSENT TO THE
COLLECTION, USE AND TRANSFER, IN ELECTRONIC OR OTHER FORM, OF YOUR PERSONAL DATA
AS DESCRIBED IN THE GRANT NOTICE, AND THE STOCK OPTION AGREEMENT AND THESE
ADDITIONAL TERMS AND CONDITIONS FOR NON-U.S. EMPLOYEES BY AND AMONG, AS
APPLICABLE, YOUR EMPLOYER, THE COMPANY AND ITS AFFILIATES FOR THE EXCLUSIVE
PURPOSE OF IMPLEMENTING, ADMINISTERING AND MANAGING YOUR PARTICIPATION IN THE
PLAN.
(b) YOU UNDERSTAND THAT THE COMPANY AND YOUR EMPLOYER MAY HOLD
CERTAIN PERSONAL INFORMATION ABOUT YOU, INCLUDING, BUT NOT LIMITED TO, YOUR
NAME, HOME ADDRESS AND TELEPHONE NUMBER, DATE OF BIRTH, SOCIAL INSURANCE NUMBER
OR OTHER IDENTIFICATION NUMBER, SALARY, NATIONALITY, JOB TITLE, ANY SHARES OF
COMMON STOCK OR DIRECTORSHIPS HELD IN THE COMPANY, DETAILS OF ALL OPTIONS OR ANY
OTHER ENTITLEMENT TO SHARES OF COMMON STOCK AWARDED, CANCELED, EXERCISED,
VESTED, UNVESTED OR OUTSTANDING
2004 NHSP T&C 03-05-04
A-2
IN YOUR FAVOR, FOR THE PURPOSE OF IMPLEMENTING, ADMINISTERING AND MANAGING THE
PLAN ("DATA").
(c) YOU UNDERSTAND THAT DATA MAY BE TRANSFERRED TO ANY THIRD PARTIES
ASSISTING IN THE IMPLEMENTATION, ADMINISTRATION AND MANAGEMENT OF THE PLAN, THAT
THESE RECIPIENTS MAY BE LOCATED IN YOUR COUNTRY OR ELSEWHERE, AND THAT THE
RECIPIENT'S COUNTRY MAY HAVE DIFFERENT DATA PRIVACY LAWS AND PROTECTIONS THAN
YOUR COUNTRY. YOU UNDERSTAND THAT YOU MAY REQUEST A LIST WITH THE NAMES AND
ADDRESSES OF ANY POTENTIAL RECIPIENTS OF THE DATA BY CONTACTING YOUR LOCAL HUMAN
RESOURCES REPRESENTATIVE. YOU AUTHORIZE THE RECIPIENTS TO RECEIVE, POSSESS, USE,
RETAIN AND TRANSFER THE DATA, IN ELECTRONIC OR OTHER FORM, FOR THE PURPOSES OF
IMPLEMENTING, ADMINISTERING AND MANAGING YOUR PARTICIPATION IN THE PLAN,
INCLUDING ANY REQUISITE TRANSFER OF SUCH DATA AS MAY BE REQUIRED TO A BROKER OR
OTHER THIRD PARTY WITH WHOM YOU MAY ELECT TO DEPOSIT ANY SHARES OF COMMON STOCK
ACQUIRED UPON EXERCISE OF YOUR OPTION. YOU UNDERSTAND THAT DATA WILL BE HELD
ONLY AS LONG AS IS NECESSARY TO IMPLEMENT, ADMINISTER AND MANAGE YOUR
PARTICIPATION IN THE PLAN.
(d) YOU UNDERSTAND THAT YOU MAY, AT ANY TIME, VIEW DATA, REQUEST
ADDITIONAL INFORMATION ABOUT THE STORAGE AND PROCESSING OF DATA, REQUIRE ANY
NECESSARY AMENDMENTS TO DATA OR REFUSE OR WITHDRAW THE CONSENTS HEREIN, IN ANY
CASE WITHOUT COST, BY CONTACTING IN WRITING YOUR LOCAL HUMAN RESOURCES
REPRESENTATIVE. YOU UNDERSTAND, HOWEVER, THAT REFUSING OR WITHDRAWING YOUR
CONSENT MAY AFFECT YOUR ABILITY TO PARTICIPATE IN THE PLAN. FOR MORE INFORMATION
ON THE CONSEQUENCES OF YOUR REFUSAL TO CONSENT OR WITHDRAWAL OF CONSENT, YOU
UNDERSTAND THAT YOU MAY CONTACT YOUR LOCAL HUMAN RESOURCES REPRESENTATIVE.
3. GOVERNING LAW.
(a) The laws of the State of Delaware shall govern all questions
concerning the construction, validity and interpretation of your option grant
without regard to such state's conflict of laws rules, as provided in the Plan.
(b) For purposes of litigating any dispute that arises directly or
indirectly from the relationship of the parties evidenced by the option grant,
the Grant Notice and the Stock Option Agreement, the parties hereby submit to
and consent to the exclusive jurisdiction of the State of California and agree
that such litigation shall be conducted only in the courts of Orange county,
California, or the federal courts for the United States for the Southern
District of California, and no other courts, where this grant is made and/or to
be performed.
4. LANGUAGE. If you have received any document related to the Plan
translated into a language other than English and if the translated version is
different than the English version, the English version will control.
5. ELECTRONIC DELIVERY. The Company may, in its sole discretion, decide to
deliver any documents related to your option granted under and participation in
the Plan or future options that may be granted under the Plan by electronic
means or to request your consent to participate in the Plan by electronic means.
You hereby consent to receive such documents by electronic delivery and, if
requested, to agree to participate in the Plan through an on-line or electronic
system established and maintained by the Company or another third party
designated by the Company.
2004 NHSP T&C 03-05-04
A-3
6. SEVERABILITY. The provisions of the Stock Option Agreement and these
Additional Terms and Conditions for Non-U.S. Employees are severable and if any
one or more provisions are determined to be illegal or otherwise unenforceable,
in whole or in part, the remaining provisions shall nevertheless be binding and
enforceable.
7. COUNTRY-SPECIFIC PROVISIONS.
(a) Notwithstanding Section 6(c) of the Plan and Section 3 of the
Stock Option Agreement, if you are an Employee residing in CHINA, INDIA or the
NETHERLANDS, you are restricted to using the "cashless exercise" program
described in Section 3(a) of the Stock Option Agreement to pay the exercise
price. Under this program, you will not be entitled to receive any shares of
Common Stock upon exercise of your option.
(b) In addition, if you are an Employee residing in the NETHERLANDS,
you confirm that taxation of your option shall be deferred until exercise of
your option. By accepting this award, you hereby waive all rights to repeal this
method of taxation, as provided under the Dutch General Tax Act (Algemene Wet
Inzake Rijksbelastingen) and the Dutch General Administrative Law Act (Algemene
Wet Bestuursrecht).
(c) If you are an Employee residing in ITALY, by accepting this
award, you specifically and expressly acknowledge that you have read, understood
and approved the following provisions in the Stock Option Agreement and in these
Additional Terms and Conditions for Non-U.S. Employees: Section 6 of the Stock
Option Agreement ("Term"); Section 7 of the Stock Option Agreement ("Exercise");
Section 10 of the Stock Option Agreement ("Withholding Obligations"); Section 1
of these additional Terms and Conditions for Non-U.S. Employees ("Nature of
Grant"); Section 2 of these additional Terms And Conditions for Non-U.S.
Employees ("Data Privacy"); and Section 3 of these additional Terms and
Conditions for Non-U.S. Employees ("Governing Law").
(d) Notwithstanding Section 10 of the Stock Option Agreement, if you
are an Employee residing in the UNITED KINGDOM, as a condition of exercising
your option, you agree to pay or make adequate arrangements satisfactory to the
Company and/or your employer to satisfy all withholding obligations of the
Company and/or your employer by the Due Date, which is 90 days, or such other
period as required under U.K. law, after the grant, vesting, exercise,
assignment, release or cancellation of your option (the "Chargeable Event"). In
this regard, you authorize the Company and/or your employer to withhold all
applicable income tax, primary Class 1 National Insurance contributions and any
other tax-related withholding ("Tax-Related Items") legally payable by you from
your wages or other cash compensation paid to you by the Company and/or your
employer or from proceeds of the sale of the shares of Common Stock.
Alternatively, or in addition, the Company may sell or arrange for the sale of
the shares of Common Stock that you acquire to meet the withholding obligation
for Tax-Related Items. You shall pay to the Company or your employer any amount
of Tax-Related Items that the Company or your employer may be required to
withhold with respect to the Chargeable Event that cannot be satisfied by the
means previously described. If payment or withholding is not made by the Due
Date, you agree that the amount of any uncollected Tax-Related Items shall
constitute a loan owed by you to your employer, effective on the Due Date. You
agree that the loan will bear interest at the then-current Inland Revenue
Official Rate and it will be immediately due and
2004 NHSP T&C 03-05-04
A-4
repayable, and the Company and/or your employer may recover it at any time
thereafter by any of the means referred to above. If any of the foregoing
methods of collection are not allowed under applicable law or if you fail to
comply with your obligations in connection with the Tax-Related Items as
described in this section, the Company may refuse to honor the exercise of your
option and to deliver the shares of Common Stock acquired under the plan.
BY ACCEPTING THE GRANT OF YOUR OPTION, YOU AGREE TO ALL OF
THE TERMS AND CONDITIONS IN THE GRANT NOTICE, THE STOCK OPTION AGREEMENT, THE
PLAN, AND THESE ADDITIONAL TERMS AND CONDITIONS FOR NON-U.S. EMPLOYEES. IF YOU
DO NOT EXPRESSLY REJECT YOUR OPTION BY NOTIFYING THE COMPANY OF YOUR REJECTION
WITHIN 30 DAYS OF RECEIPT OF YOUR GRANT MATERIALS, YOU WILL BE DEEMED TO HAVE
IRREVOCABLY ACCEPTED YOUR OPTION.
2004 NHSP T&C 03-05-04
A-5
[Date]
[Name]
[Address]
Employee ID: [ID Number]
[Dear [Name]:
RE: CONEXANT SYSTEMS, INC. STOCK OPTION GRANT NOTICE (2004 NEW-HIRE EQUITY
INCENTIVE PLAN)
Conexant Systems, Inc. (the "Company"), pursuant to its 2004 New-Hire Equity
Incentive Plan (the "Plan"), hereby grants to you (Optionholder) an option to
purchase the number of shares of the Company's Common Stock set forth below.
This option is subject to all of the terms and conditions as set forth herein,
in the Stock Option Agreement, the Plan and, if applicable, in the Additional
Terms and Conditions for Non-U.S. Employees, all of which are available on the
Company's Intranet and incorporated herein in their entirety. To access this
information, please go to Conexant NextWeb, select Departments, Human Resources,
Compensation, Stock Administration. If you have any questions, please contact
Stock Administration at (000) 000-0000 or xxxxx.xxxxx@xxxxxxxx.xxx. Please read
all documents carefully.
Optionholder: ____________________________________
Date of Grant: ____________________________________
Vesting Commencement Date: ____________________________________
Number of Shares Subject to Option: ____________________________________
Exercise Price (Per Share): ____________________________________
Expiration Date: ____________________________________
EXERCISE SCHEDULE: Same as Vesting Schedule.
VESTING SCHEDULE: [Percentage] of the shares vest on each anniversary of
the Vesting Commencement Date.
PAYMENT: By one or a combination of the following items (described
in the Stock Option Agreement and, if applicable, subject
to the Additional Terms and Conditions for Non-U.S.
Employees):
[X] By cash or check
[X] Pursuant to a Regulation T ("Cashless Exercise")
Program
[X] By delivery of already-owned shares
ADDITIONAL TERMS/ACKNOWLEDGEMENTS: The Optionholder acknowledges receipt of, and
understands and agrees to, this Stock Option Grant Notice, the Stock Option
Agreement, the Plan and, if applicable, the Additional Terms and Conditions for
Non-U.S. Employees. Optionholder further acknowledges that as of the Date of
Grant, this Stock Option Grant Notice, the Stock Option Agreement, the Plan and,
if applicable, the Additional Terms and Conditions for Non-U.S. Employees set
forth the entire understanding between Optionholder and the Company regarding
the acquisition of stock in the Company and supersede all prior oral and written
agreements on that subject.
/s/ Xxxxxx X. X'Xxxxxx
Xxxxxx X. X'Xxxxxx
Senior Vice President,
Chief Legal Officer & Secretary
