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EXHIBIT 10.14
C-CUBE SEMICONDUCTOR INC.
NONSTATUTORY STOCK OPTION AGREEMENT
FOR OUTSIDE DIRECTORS
C-Cube Semiconductor Inc., a Delaware corporation (the "Company"), hereby
grants to ________________________ (the "Optionee") an option to purchase a
total of _______________ (_______) shares of the common stock of the Company
(the "Number of Option Shares") under the C-Cube Semiconductor Inc. Directors
Stock Option Plan (the "Plan"), at an exercise price of $______ per share and in
the manner and subject to the provisions of this Option Agreement (the
"Option"). The grant, in all respects, is subject to the terms and conditions of
this Option Agreement and the Plan, the provisions of which are incorporated by
reference herein. Unless otherwise provided in this Option Agreement, defined
terms shall have the meaning given to such terms in the Plan.
1. Grant of the Option. The Option is granted effective as of (the
"Date of Option Grant"). The Number of Option Shares and the exercise price per
share of the Option are subject to adjustment from time to time as provided in
the Plan.
2. Status of the Option. The Option is intended to be a nonstatutory
stock option and shall not be treated as an incentive stock option as described
in section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
3. Term of the Option. The Option shall terminate and may no longer be
exercised on the first to occur of (i) the date ten (10) years after the Date of
Option Grant, (ii) the last date for exercising the Option following termination
of the Optionee's service as a director of the Company as described in paragraph
6 below, or (iii) upon a Transfer of Control of the Company as described in the
Plan.
4. Exercise of the Option.
(a) Right to Exercise.
(i) The Option first becomes exercisable on the day which is
one year from the Date of Option Grant (the "Initial Vesting Date") provided the
Optionee has continuously served as a director of the Company from the Date of
Option Grant until the Initial Vesting Date. The Option shall be exercisable on
and after the Initial Exercise Date and prior to the termination of the Option
in the amount equal to the Number of Option Shares multiplied by the Vested
Ratio as set forth in paragraph 4(a)(ii), below, less the number of shares
previously acquired upon exercise of the Option.
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Vested Ratio
(ii) Prior to Initial Vesting Date 0
On Initial Vesting Date, 1/4
provided the Optionee has
continuously served as a
director of the Company from
the date the Option was
granted until the Initial
Vesting Date.
Plus
For each full month of the 1/48
Optionee's continuous service
as a director of the Company
from the Initial Vesting Date.
(iii) In no event shall the Option be exercisable for
more shares than the Number of Option Shares.
(b) Method of Exercise. The Option may be exercised by written
notice to the Company which must state the election to exercise the Option, the
number of shares of stock for which the Option is being exercised and such other
representations and agreements as to the Optionee's investment intent with
respect to such shares as may be required pursuant to the provisions of this
Option Agreement and the Plan. The written notice must be signed by the Optionee
and must be delivered in person or by certified or registered mail, return
receipt requested, to the Chief Financial Officer of the Company, or other
authorized representative of the Company, prior to the termination of the Option
as set forth in paragraph 3 above, accompanied by full payment of the exercise
price for the number of shares of stock being purchased in a form permitted
under the terms of the Plan.
(c) Withholding. At the time the Option is exercised, in whole or
in part, or at any time thereafter as requested by the Company, the Optionee
shall make adequate provision for the foreign, federal and state tax withholding
obligations of the Company, if any, which arise in connection with the Option
including, without limitations obligations arising upon (i) the exercise, in
whole or in part, of the Option, (ii) the transfer, in whole or in part, of any
shares of stock acquired on exercise of the Option, or (iii) the lapsing of any
restriction with respect to any shares acquired on exercise of the Option.
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(d) Certificate Registration. The certificate or certificates for
the shares of stock as to which the Option shall be exercised shall be
registered in the name of the Optionee, or, if applicable, the heirs of the
Optionee.
(e) Restriction on Grant of the Option and Issuance of Shares. The
grant of the Option and the issuance of shares of stock on exercise of the
Option shall be subject to compliance with all of the applicable requirements of
federal or state law with respect to such securities. The Option may not be
exercised if the issuance of shares of stock upon such exercise would constitute
a violation of any applicable federal or state securities laws or other law or
regulation. In addition, no Option may be exercised unless (i) a registration
statement under the Securities Act of 1933, as amended (the "Securities Act"),
shall at the time of exercise of the Option be in effect with respect to the
shares of stock issuable upon exercise of the Option, or (ii) in the opinion of
legal counsel to the Company, the shares issuable upon exercise of the Option
may be issued in accordance with the terms of an applicable exemption from the
registration requirements of the Securities Act. As a condition to the exercise
of the Option, the Company may require the Optionee to satisfy any
qualifications that may be necessary or appropriate, to evidence compliance with
any applicable law or regulation and to make any representation or warranty with
respect thereto as may be requested by the Company.
(f) Fractional Shares. The Company shall not be required to issue
fractional shares of stock upon the exercise of the Option.
5. Non-Transferability of the Option. The Option may be exercised
during the lifetime of the Optionee only by the Optionee and may not be assigned
or transferred in any manner except by will or by the laws of descent and
distribution.
6. Termination of Service as a Director.
(a) Termination of Director Status. If the Optionee ceases to be a
director of the Company for any reason except death or disability within the
meaning of section 22(e)(3) of the Code, the Option, to the extent unexercised
and exercisable by the Optionee on the date on which the Optionee ceased to be a
director, may be exercised by the Optionee at any time prior to the expiration
of three (3) months from the date on which the Optionee's service as a director
of the Company terminated, but in any event no later than the Option Term Date.
If the Optionee ceases to be a director of the Company because of the death or
disability of the Optionee within the meaning of section 22(e)(3) of the Code,
the Option, to the extent unexercised and exercisable by the Optionee on the
date on which the Optionee ceased to be a director, may be exercised by the
Optionee (or the Optionee's legal representative) at any time prior to the
expiration of six (6) months from the date on which the Optionee's service as a
director of the Company terminated, but in any event no later than the Option
Term Date. The Optionee's service as a director of the Company shall be deemed
to have terminated on account of death if the Optionee dies within three (3)
months after the Optionee's termination of service as a director of the Company.
Except as provided in this paragraph 6, an Option shall terminate and may not be
exercised after the Optionee ceases to be a director of the Company.
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7. Rights as a Stockholder. The Optionee shall have no rights as a
stockholder with respect to any shares of stock covered by the Option until the
date of the issuance of a certificate or certificates for the shares for which
the Option has been exercised. No adjustment shall be made for dividends or
distributions or other rights for which the record date is prior to the date
such stock certificate or certificates are issued, except as provided in the
Plan.
8. Effect of Change in Stock Subject to the Option. Appropriate
adjustments shall be made in the number, exercise price and class of shares of
stock subject to the Option in the event of a stock dividend, stock split,
reverse stock split, recapitalization, combination, reclassification, or like
change in the capital structure of the Company. In the event a majority of the
shares which are of the same class as the shares that are subject to the Option
are exchanged for, converted into, or otherwise become shares of another
corporation (the "New Shares"), the Company may unilaterally amend the Option to
provide that the Option is exercisable for New Shares. In the event of any such
amendment, the number of shares and the exercise price shall be adjusted in a
fair and equitable manner.
9. Transfer of Control. A "Transfer of Control" shall be deemed to have
occurred in the event any of the following occurs with respect to the Company:
(a) a merger or consolidation in which the Company is not the
surviving corporation;
(b) a merger or consolidation in which the Company is the
surviving corporation where the stockholders of the Company before such merger
or consolidation do not retain, directly or indirectly, at least a majority of
the beneficial interest in the voting stock of the Company after such merger or
consolidation;
(c) the sale, exchange, or transfer of all or substantially all of
the assets of the Company (other than a sale, exchange, or transfer to one (1)
or more subsidiary corporations (as defined in Section 2.1 above) of the
Company);
(d) the direct or indirect sale or exchange by the stockholders of
the Company of all or substantially all of the stock of the Company where the
stockholders of the Company before such sale or exchange do not retain, directly
or indirectly, at least a majority of the beneficial interest in the voting
stock of the Company after such sale or exchange; or
(e) A liquidation or dissolution of the Company.
In the event of a Transfer of Control, the Board, in its sole
discretion, may arrange with the surviving, continuing, successor, or purchasing
corporation or parent corporation thereof, as the case may be (the "Acquiring
Corporation"), for the Acquiring Corporation to assume the Company's rights and
obligations under the Option or substitute options for the Acquiring
Corporation's stock for the Option. In the event of a Transfer of Control which
occurs more than two (2) years after the date the Plan is adopted, the
unexercisable and/or unvested portion of the Option shall immediately be
exercisable and vested as of a date prior to the Transfer of Control, as the
Board shall specify. The exercise and/or vesting that is permissible solely by
reason of this
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paragraph shall be conditioned upon the consummation of the Transfer of Control.
To the extent the Option is neither assumed or substituted for by the Acquiring
Corporation in connection with the Transfer of Control nor exercised as of the
date of the Transfer of Control, the Option shall terminate and cease to be
outstanding effective as of the date of the Transfer of Control.
10. Legends. The Company may at any time place legends referencing any
applicable federal or state securities law restrictions on all certificates
representing shares of stock subject to the provisions of this Option Agreement.
The Optionee shall, at the request of the Company, promptly present to the
Company any and all certificates representing shares of stock acquired pursuant
to the Option in the possession of the Optionee in order to effectuate the
provisions of this paragraph.
11. Binding Effect. Option Agreement shall inure to the benefit of the
successors and assigns of the Company and be binding upon the Company and the
Optionee and the Optionee's heirs, executors, administrators, successors and
assigns.
12. Termination or Amendment. The Board, including any duly appointed
committee of the Board, may terminate or amend the Plan and/or the Option at any
time subject to any limitations described in the Plan; provided, however, that
no such termination or amendment may adversely affect the Option or any
unexercised portion hereof without the consent of the Optionee.
13. Integrated Agreement. This Option Agreement and the Plan constitute
the entire understanding and agreement of the Optionee and the Company with
respect to the subject matter contained herein and therein, and there are no
agreements, understandings, restrictions, representations, or warranties among
the Optionee and the Company other than those as set forth or provided for
herein or therein. To the extent contemplated herein and therein, the provisions
of this Option Agreement and the Plan shall survive any exercise of the Option
and shall remain in fun force and effect.
14. Applicable Law. This Option Agreement shall be governed by the laws
of the State of California as such laws are applied to agreements between
California residents entered into and to be performed entirely within the State
of California.
C-CUBE SEMICONDUCTOR INC.
By:
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Title:
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The Optionee represents that the Optionee is familiar with the terms and
provisions of this Option Agreement and the Plan and hereby accepts the Option
subject to all of the terms and provisions thereof. The Optionee hereby agrees
to accept as binding, conclusive and final all decisions or interpretations of
the Board upon any questions arising under this Option Agreement or the Plan.
The undersigned acknowledges receipt of a copy of the Plan.
Date:
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Signature
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NONSTATUTORY STOCK OPTION
NOTICE OF EXERCISE
To: Chief Financial Officer
C-Cube Semiconductor Inc.
I hereby exercise my Option to purchase the number of shares (the
"Shares") of Common Stock of C-Cube Semiconductor Inc. (the "Company') set
opposite my signature below. Full payments for the Shares in the manner set
forth in my Option Agreement accompanies this notice.
I hereby authorize payroll withholding and otherwise will make adequate
provision for foreign, federal and state tax withholding obligations, if any, as
more fully set forth in my Option Agreement.
I understand that the Shares are being purchased pursuant to the terms of
the C-Cube Semiconductor Inc. Directors Stock Option Plan and my Option
Agreement, copies of which I have received and carefully read and understand.
Date of Exercise:
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Date of Option Agreement:
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Shares Being Purchased:
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Price per Share: $
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Signature
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Print Name
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Social Security Number
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Address
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