Mindspeed Technologies, Inc. Directors Stock Plan Stock Option Agreement Stock Option Terms and Conditions
Exhibit 10.33
Directors Stock
Plan
Stock Option Terms and
Conditions
1. Definitions
Capitalized terms used and not defined herein shall have the
respective meanings assigned to such terms in the Plan. As used
in these Stock Option Terms and Conditions, the following words
and phrases shall have the respective meanings ascribed to them
below unless the context in which any of them is used clearly
indicates a contrary meaning:
(a) FAST: Fidelity’s
automated service telephone system that is used to facilitate
stock option transactions.
(b) Fidelity: Fidelity Stock Plan
Services, the stock option administrator whom Mindspeed has
engaged to administer and process all stock option exercises.
(c) Grant Date: The date of the
grant of the Options.
(d) Grant Letter: The letter from
Mindspeed granting the stock option or stock options to you.
(e) Mindspeed: Mindspeed
Technologies, Inc., a Delaware corporation.
(f) NASDAQ: The Nasdaq Global
Market.
(g) Options: The stock option or
stock options listed in the first paragraph of the Grant Letter
and which together with these Stock Option Terms and Conditions
constitutes the Stock Option Agreement.
(h) Option Shares: The shares of
Mindspeed Common Stock issuable or transferable on exercise of
the Options.
(i) Plan: Mindspeed’s
2003 Directors Stock Plan, as such Plan may be amended and
in effect at the relevant time.
(j) Shares: Shares of Mindspeed
Common Stock.
(k) Stock Option Agreement: These
Stock Option Terms and Conditions together with the Grant Letter
to which they are attached.
(l) Web: Fidelity’s website
that is used to facilitate stock option transactions.
2. When
Options May be Exercised
The Options may be exercised, in whole or in part (but only for
a whole number of shares) and at one time or from time to time,
as follows:
|
Beginning
|
Ending
|
|||
|
25% of the Option Shares
|
1 Year from Grant Date | 10 Years from Grant Date | ||
|
25% of the Option Shares
|
2 Years from Grant Date | 10 Years from Grant Date | ||
|
25% of the Option Shares
|
3 Years from Grant Date | 10 Years from Grant Date | ||
|
25% of the Option Shares
|
4 Years from Grant Date | 10 Years from Grant Date |
All vesting increments are rounded to the nearest whole number
of Option Shares and vest only during the period indicated
above, provided that:
(a) if you die while a Director of Mindspeed, your estate,
or any person who acquires the Options by bequest or
inheritance, may exercise all the Options not theretofore
exercised within (and only within) the period beginning on your
date of death (even if you die before you have become entitled
to exercise all or any part of the Options) and ending three
(3) years thereafter or ten (10) years after the Grant
Date, if earlier;
(b) if you retire as a Director at or after age fifty five
(55) and completing at least five (5) years of service
as a Director, you (or if you die after your retirement date,
your estate or any person who acquires the Options by bequest or
inheritance) may thereafter exercise the Options not theretofore
exercised within (and only within) the period beginning on your
retirement date (even if you retire before you have become
entitled to exercise all or any part of the Options) and ending
five (5) years thereafter or on ten (10) years after
the Grant Date, if earlier;
(c) if your service as a Director terminates as a result of
your disability or as a result of your resignation for reasons
of the antitrust laws, compliance with Mindspeed’s conflict
of interest policies or other circumstances that the Committee
may determine as serving the best interests of Mindspeed, you
(or if you die after termination of your service as a Director,
your estate or any person who acquires the Options by bequest or
inheritance) may thereafter exercise the Options not theretofore
exercised that are exercisable on the date your service as a
Director terminates within (and only within) such period, if
any, after your termination date as the Committee may determine
by action taken not more than sixty (60) days after your
termination date, which period shall in no event end more than
five years after your termination date or on ten (10) years
from the Grant Date, if earlier;
(d) in the event a Change of Control shall occur, then all
the Options shall forthwith become fully exercisable whether or
not otherwise then exercisable; provided, however, that each
such Option shall expire at the earlier of five (5) years
from the date of the Change of Control or the expiration date
specified in the Option; and
(e) if your service as a Director terminates for any other
reason, the Options shall terminate forthwith on the date of
termination of your service as a Director and shall not be
exercised thereafter.
3. Exercise
Procedure
(a) To exercise all or any part of the Options, you (or
after your death, your estate or any person who has acquired the
Options by bequest or inheritance) must:
(i) contact the administrator, Fidelity, by using the FAST
or Web system or by speaking to a Fidelity customer service
representative and follow the instructions provided;
(ii) confirm the Option transaction by receiving a
confirmation number through the FAST or Web system or by
speaking to a Fidelity customer service representative;
(iii) submit full payment of the exercise price for the
Option Shares to be purchased on exercise of the Options:
| • | by check or cash; or | |
| • | in Shares; or | |
| • | in a combination of check or cash and Shares; and |
(iv) provide, in the case of an exercise of the Options by
any person other than you seeking to exercise the Options, such
documents as Fidelity or the Secretary of Mindspeed shall
require to establish to their satisfaction that the person
seeking to exercise the Options is entitled to do so.
2
(b) An exercise of the whole or any part of the Options
shall be effective:
(i) if you elect (or after your death, the person entitled
to exercise the Options elects) to pay the exercise price for
the Option Shares entirely by check or cash, (i) upon
confirmation of your transaction by using the FAST or Web system
or by speaking to a Fidelity customer service representative and
full payment of the exercise price and withholding taxes (if
applicable) are received by Fidelity within three
(3) business days following the confirmation; and
(ii) receipt of any documents required pursuant to
Section 3(a)(iv); and
(ii) if you elect (or after your death, the person entitled
to exercise the Options elects) to pay the exercise price of the
Option Shares in Shares or in a combination of Shares and check
or cash, (i) upon confirmation of your transaction by using
the FAST or Web system or by speaking to a Fidelity customer
service representative and full payment of the exercise price
(as defined in Section 3(d)(i)) and withholding taxes (if
applicable) are received by Fidelity within three
(3) business days following the confirmation; and
(ii) receipt of any documents required pursuant to Section
3(a)(iv).
(c) If you choose (or after your death, the person entitled
to exercise the Options chooses) to pay the exercise price for
the Option Shares to be purchased on exercise of any of the
Options entirely by check or cash, payment must be made by:
| • | delivering to Fidelity a check or cash in the full amount of the exercise price for those Option Shares; or | |
| • | arranging with a stockbroker, bank or other financial institution to deliver to Fidelity full payment, by check, cash or (if prior arrangements are made with Fidelity) by wire transfer, of the exercise price of those Option Shares. |
In either event, in accordance with Section 3(e), full
payment of the exercise price for the Option Shares purchased
must be made within three (3) business days after the
exercise has been conducted and confirmed through the FAST or
Web system or by speaking to a Fidelity customer service
representative.
(d) (i) If you choose (or after your death, the person
entitled to exercise the Options chooses) to use already-owned
Shares to pay all or part of the exercise price for the Option
Shares to be purchased on exercise of any of the Options, you
(or after your death, the person entitled to exercise the
Options) must deliver to Fidelity one or more certificates (and
executed stock powers), or authorize the book-entry transfer to
Mindspeed of Shares, representing:
| • | at least the number of Shares whose value, based on the closing price of the Shares on the NASDAQ reporting system on the day you have exercised your Options through the FAST or Web system or by speaking to a Fidelity customer service representative, equals the exercise price for those Option Shares; or | |
| • | any lesser number of Shares you desire (or after your death, the person entitled to exercise the Options desires) to use to pay the exercise price for those Option Shares and a check or cash in the amount of such exercise price less the value of the Shares delivered, based on the closing price of the Shares on the NASDAQ reporting system on the day you have exercised your Options through the FAST or Web system or by speaking to a Fidelity customer service representative. |
In the event you are using Shares acquired from a Mindspeed
benefit plan, including but not limited to a stock option plan,
restricted stock plan, performance share plan and employee stock
purchase plan, these Shares must have been held for a minimum of
six (6) months from the date of acquisition. You will be
required to provide proper documentation attesting to the fact
that the Shares used to pay all or part of the exercise price
for the Option Shares are mature Shares. In the event you are
using Shares purchased on the open market, there is no required
holding period.
(ii) Fidelity will advise you (or any other person who,
being entitled to do so, exercises the Options) of the exact
number of Shares, valued in accordance with Section 4 of
the Plan at the closing price on the NASDAQ reporting system on
the effective date of exercise under Section 3(a)(ii), and
any funds required to pay in full the exercise price for the
Option Shares purchased. In accordance with Section 3(e),
you (or such other person) must pay, by check or cash, in Shares
or in a combination of check or cash and Shares, any balance
required to pay in full
3
the exercise price of the Option Shares purchased within three
(3) business days following the confirmation date of such
exercise of the Options under Section 3(a)(ii).
(iii) Notwithstanding any other provision of this Stock
Option Agreement, the Secretary of Mindspeed may limit the
number, frequency or volume of successive exercises of any of
the Options in which payment is made, in whole or in part, by
delivery of Shares pursuant to this subparagraph (d) to
prevent unreasonable pyramiding of such exercises.
(e) An exercise conducted and confirmed through the FAST or
Web system or by speaking to a Fidelity customer service
representative, whether or not full payment of the exercise
price for the Option Shares is received by Fidelity, shall
constitute a binding contractual obligation by you (or the other
person entitled to exercise the Options) to proceed with and
complete that exercise of the Options (but only so long as you
continue, or the other person entitled to exercise the Options
continues, to be entitled to exercise the Options on that date).
By your acceptance of this Stock Option Agreement, you agree
(for yourself and on behalf of any other person who becomes
entitled to exercise the Options) to deliver or cause to be
delivered to Fidelity any balance of the exercise price for the
Option Shares to be purchased upon the exercise pursuant to the
transaction conducted through the FAST or Web system or by
speaking to a Fidelity customer service representative required
to pay in full the exercise price for those Option Shares, that
payment being by check, cash, wire transfer, in Shares or in a
combination of check or cash and Shares, on or before the later
of the third
(3rd)
business day after the date on which you confirm the transaction
through the FAST or Web system or by speaking to a Fidelity
customer service representative. If such payment is not made,
you (for yourself and on behalf of any other person who becomes
entitled to exercise the Options) authorize Mindspeed, in its
discretion, to set off against salary payments or other amounts
due or which may become due you (or the other person entitled to
exercise the Options) any balance of the exercise price for
those Option Shares remaining unpaid thereafter.
(f) A book-entry statement representing the number of
Option Shares purchased will be issued as soon as practicable
(i) after Fidelity has received full payment therefor or
(ii) at Mindspeed’s or Fidelity’s election in
their sole discretion, after Mindspeed or Fidelity has received
(x) full payment of the exercise price of those Option
Shares and (y) any reimbursement in respect of withholding
taxes due pursuant to Section 5.
4. Transferability
You are not entitled to transfer the Options except: (i) by
will or by the laws of descent and distribution; or (ii) by
gift to any member of your immediate family or to a trust for
the benefit of one or more members of your immediate family or
to a family charitable trust established by you or one of your
immediate family members; provided, however, that no
transfer pursuant to this clause (ii) shall be effective
unless you have notified Mindspeed’s Office of the
Secretary (Attention: Stock Administration) in writing
specifying the Option or Options transferred, the date of the
gift and the name and Social Security or other Taxpayer
Identification Number of the transferee. During your lifetime,
only you are entitled to exercise the Options unless you have
transferred any Option in accordance with this paragraph to a
member of your immediate family, a trust for the benefit of one
or more members of your immediate family or to a family
charitable trust established by you or one of your immediate
family members, in which case only that transferee (or the legal
representative of the estate or the heirs or legatees of that
transferee) shall be entitled to exercise that Option. For
purposes of this paragraph, your “immediate family”
shall mean your spouse and natural, adopted or step-children and
grandchildren.
5. Withholding
Mindspeed or Fidelity shall have the right, in connection with
the exercise of the Options in whole or in part, to deduct from
any payment to be made by Mindspeed or Fidelity under the Plan
an amount equal to the taxes required to be withheld by law with
respect to such exercise or to require you (or any other person
entitled to exercise the Options) to pay to it an amount
sufficient to provide for any such taxes so required to be
withheld. By your acceptance of this Stock Option Agreement, you
agree (for yourself and on behalf of any other person who
becomes entitled to exercise the Options) that if Mindspeed or
Fidelity elects to require you (or such other person) to remit
an
4
amount sufficient to pay such withholding taxes, you (or such
other person) must remit that amount within three
(3) business days after the confirmation of the Option
exercise (Section 3(a)(ii)). If such payment is not made,
Mindspeed, in its discretion, shall have the same right of
set-off with respect to payment of the withholding taxes in
connection with the exercise of the Option as provided under
Section 3(e) with respect to payment of the exercise price.
6. Rights
as Shareowner
You will not have any rights as a shareowner with respect to any
Option Shares unless and until you become the holder of such
Option Shares on the books and records of Mindspeed. No
dividends or dividend equivalents will be paid by Mindspeed with
respect to the Option Shares.
7. Headings
The section headings contained in these Stock Option Terms and
Conditions are solely for the purpose of reference, are not part
of the agreement of the parties and shall in no way affect the
meaning or interpretation of this Stock Option Agreement.
8. References
All references in these Stock Option Terms and Conditions to
Sections, paragraphs, subparagraphs or clauses shall be deemed
to be references to Sections, paragraphs, subparagraphs and
clauses of these Stock Option Terms and Conditions unless
otherwise specifically provided.
9. Entire
Agreement
This Stock Option Agreement and the Plan embody the entire
agreement and understanding between Mindspeed and you with
respect to the Options, and there are no representations,
promises, covenants, agreements or understandings with respect
to the Options other than those expressly set forth in this
Stock Option Agreement and the Plan.
10. Applicable
Laws and Regulations
This Stock Option Agreement and Mindspeed’s obligation to
issue Option Shares hereunder are governed by the laws of
Delaware and the Federal law of the United States.
5