<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 23, 2000
REGISTRATION NO. 333-31896
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
POST-EFFECTIVE
AMENDMENT
NO. 1
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
C-CUBE SEMICONDUCTOR INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 3577 77-0192108
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
1778 MCCARTHY BLVD.
MILPITAS, CALIFORNIA 95035
(408) 490-8000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
ALEXANDRE BALKANSKI
PRESIDENT AND CHIEF EXECUTIVE OFFICER
C-CUBE MICROSYSTEMS INC.
1778 MCCARTHY BLVD.
MILPITAS, CALIFORNIA 95035
(408) 490-8000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------
COPIES TO:
LARRY W. SONSINI, ESQ.
STEVE L. CAMAHORT, ESQ.
KELLY S. BOYD, ESQ.
WILSON SONSINI GOODRICH & ROSATI
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CALIFORNIA 94304
(650) 493-9300
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC:
As soon as practicable after the effective date of this Registration Statement.
------------------------
If any of the securities being registered on this Form are being offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
EXPLANATORY NOTE
This Post-Effective Amendment No. 1 to the Registrant's Registration
Statement on Form S-1 (File No. 333-31896) is being filed solely for the purpose
of filing exhibits.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses payable by the
Registrant in connection with the sale of Common Stock being registered. All
amounts are estimates except the registration fee and the NASD filing fee.
<TABLE>
<CAPTION>
AMOUNT
TO BE
PAID
--------
<S> <C>
Registration Fee............................................ $316,800
NASD Fee.................................................... 6,000
Nasdaq National Market Listing Fee..........................
Printing and Engraving...................................... 300,000
Legal Fees and Expenses..................................... 400,000
Accounting Fees and Expenses................................ 300,000
Blue Sky Fees and Expenses.................................. 6,000
Transfer Agent Fees......................................... 20,000
Miscellaneous............................................... $100,000
--------
Total.....................................................
========
</TABLE>
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As permitted by Section 145 of the Delaware General Corporation Law, the
Registrant's certificate of incorporation includes a provision that eliminates
the personal liability of its directors for monetary damages for breach or
alleged breach of their duty of care to the Company or its stockholders. In
addition, as permitted by Section 145 of the Delaware General Corporation Law,
the certificate of incorporation of the Registrant provides, inter alia, that
each person who is made a party or is threatened to be made a party to or
otherwise involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative (hereinafter a "proceeding"), by reason of the
fact that he or she is or was a director or officer of the Company or, while a
director or officer of the Company, is or was serving at the request of the
Company as a director, officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to an employee benefit plan (hereinafter an "indemnitee"), whether the
basis of such proceeding is alleged action in an official capacity as a director
or officer or in any other capacity while serving as a director or officer, is
authorized to be indemnified and held harmless by the Company to the fullest
extent authorized by the Delaware General Corporation Law, as the same exists or
may hereafter be amended, against all expense, liability and loss (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) reasonably incurred or suffered by such indemnitee in
connection therewith and such indemnification shall continue as to an
indemnitee's heirs, executors and administrators; provided, however, that,
except with respect to the proceedings brought by an indemnitee to enforce
rights to indemnification (subject to certain restrictions and as more fully
described in the Registrant's certificate of incorporation), the Company shall
indemnify any such indemnitee in connection with a proceeding (or part thereof)
initiated by such indemnitee only if such proceeding (or part thereof) was
authorized by the Board of Directors of the Company. The right to
indemnification conferred in the Registrant's certificate of incorporation
includes the right to be paid by the Company the expenses incurred in connection
with any such proceeding in advance of its final disposition; provided, however,
that, if and to the extent that the Delaware General Corporation Law requires,
such an advancement of expenses incurred by an indemnitee in his or her capacity
in which service was or is rendered by such indemnitee, including, without
limitation, service with respect to an employee benefit plan, shall be made only
upon delivery to the Company of an undertaking by or on behalf of such
indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision
II-1
<PAGE> 3
from which there is no further right to appeal that such indemnitee is not
entitled to be indemnified for such expenses under the Company's certificate of
incorporation or otherwise.
The Registrant's policy is to enter into indemnification agreements with
each of its directors and executive officers that provide the maximum indemnity
allowed to directors and executive officers by Section 145 of the Delaware
General Corporation Law and the Bylaws, as well as certain additional procedural
protections. The indemnity agreements provide that directors and executive
officers will be indemnified to the fullest possible extent not prohibited by
law against all expenses (including attorney's fees) and settlement amounts paid
or incurred by them in any action or proceeding, including any derivative action
by or in the right of the Registrant, on account of their services as directors
or executive officers of the Registrant or as directors or officers of any other
company or enterprise when they are serving in such capacities at the request of
the Registrant. Pursuant to the indemnity agreements, the Company will not be
obligated to indemnify or advance expenses to an indemnified party with respect
to proceedings or claims initiated by the indemnified party and not by way of
defense, except with respect to proceedings specifically authorized by the Board
of Directors or brought to enforce a right to indemnification under such
indemnity agreement, the Company's certificate of incorporation, Bylaws or any
statute or law, or as otherwise required under Section 145 of the Delaware
General Corporation Law. Also under the indemnity agreements, the Company is not
obligated to indemnify the indemnified party for (i) any expenses incurred by
the indemnified party with respect to any proceeding instituted by the
indemnified party to enforce or interpret the agreement, if a court of competent
jurisdiction determines that each of the material assertions made by the
indemnified party in such proceeding was not made in good faith or was
frivolous, (ii) acts, omissions or transactions on the part of the indemnified
party from which such party may not be relieved of liability under applicable
law or (iii) expenses and the payment of profits arising from the purchase and
sale by the indemnified party of securities in violation of Section 16(b) of the
Exchange Act, or any similar or successor statute.
The indemnification provisions in the certificate of incorporation and the
indemnification agreements entered into between the Registrant and its directors
and executive officers, may be sufficiently broad to permit indemnification of
the Registrant's officers and directors for liabilities arising under the 1933
Act.
Reference is made to the following documents filed as exhibits to this
Registration Statement regarding relevant indemnification provisions described
above and elsewhere herein:
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
The following sets forth information regarding all securities sold by
Semiconductor since its date of incorporation:
In February 2000, Semiconductor entered into a securities purchase
agreement with Thomson Multimedia S.A.. The securities purchase agreement
provides that, for a purchase price of $19.78 per share of common stock, Thomson
will receive 474,747 shares of Semiconductor's common stock and a warrant to
purchase 949,494 shares of Semiconductor's common stock at an exercise price of
$19.78. The warrant is fully-vested upon issuance and is exercisable
approximately seven (7) years from the date of the agreement. Notwithstanding
this provision, if Thomson attains certain milestones, the warrant will be
accelerated and exercisable in part. All of the securities issued to Thomson
pursuant to the agreement are restricted securities that have not been
registered under the Securities Act and that have been acquired for investment
purposes and not to resell.
If Thomson wishes to dispose of 33% or more of the securities that it
obtained pursuant to the agreement, Semiconductor will have the first right to
repurchase the shares in whole or in part for cash at the amount specified in
the transfer notice provided to Semiconductor by Thomson. If Semiconductor
chooses not to exercise this right, Thomson is free to transfer the shares on
terms not materially less favorable than those offered by Semiconductor to the
potential purchaser. Transfers to qualified institutional buyers are exempt from
this right of first refusal.
II-2
<PAGE> 4
The foregoing transaction did not involve any underwriters, underwriting
discounts or commissions, or any public offering, and we believe that the
transaction was exempt from the registration requirements of the Securities Act
by virtue of Section 4(2) thereof and Regulation D promulgated thereunder. The
recipients in such transactions represented their intention to acquire the
securities for investment only and not with a view to or for sale in connection
with any distribution thereof, and appropriate legends were affixed to the share
certificates and instruments issued in such transactions. All recipients had
adequate access to information about the Company.
ITEM 16. EXHIBITS AND FINANCIAL SCHEDULES
(a) EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
-------------------
<C> <S>
3.1* Certificate of Incorporation of C-Cube Semiconductor Inc.
3.2* Bylaws of C-Cube Semiconductor Inc.
4.2 Specimen Stock Certificate
5.1** Form of Legal Opinion
8.1** Form of Tax Opinion
10.1** Form of Separation and Distribution Agreement between C-Cube
Microsystems Inc. and C-Cube Semiconductor Inc.
10.2** Form of Tax Sharing Agreement between C-Cube Microsystems
Inc. and C-Cube Semiconductor Inc.
10.3** Form of Assignment and Assumption Agreement between C-Cube
Microsystems Inc. and C-Cube Semiconductor Inc.
10.4** Form of Indemnification and Insurance Matters Agreement
between C-Cube Microsystems Inc. and C-Cube Semiconductor
Inc.
10.5** Form of Transitional Services Agreement between C-Cube
Microsystems Inc. and C-Cube Semiconductor Inc.
10.6* Form of Officers' and Directors' Indemnification Agreement.
10.7* Securities Purchase Agreement by and between C-Cube
Semiconductor Inc. and Thomson Multimedia S.A. dated as of
February 11, 2000.
10.8*+ Form of Warrant for Thomson Multimedia S.A.
10.9 2000 Stock Plan
10.10 Form of 2000 Stock Plan Agreement
10.11 2000 Employee Stock Purchase Plan
10.12 Form of 2000 Employee Stock Purchase Plan Agreement
10.13 2000 Director Option Plan
10.14 Form of 2000 Director Plan Agreement
21.1** List of Subsidiaries
23.1** Form of Accountant's Consent
24.1** Power of Attorney (see page II-5)
</TABLE>
- ------------------------
* Previously filed as an exhibit to Semiconductor's Registration Statement on
Form 10.
** Previously filed as an exhibit to Semiconductor's Registration Statement on
Form S-1.
+ Confidential treatment.
II-3
<PAGE> 5
(b) FINANCIAL STATEMENT SCHEDULES
Independent Auditors' Report S-1
Valuation and Qualifying Accounts and Reserves S-2
ITEM 17. UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions referenced in Item 14 of this Registration
Statement or otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act, and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer,
or controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered hereunder, the Registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Act, the
information omitted from the form of Prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form
of Prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Act, each
post-effective amendment that contains a form of Prospectus shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has duly
caused this Registration Statement on Form S-1 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Milpitas, State of
California, on the 23rd day of March, 2000.
C-CUBE SEMICONDUCTOR INC.
By: /s/ UMESH PADVAL
------------------------------------
Umesh Padval
President, Chief Executive Officer
and Director
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<S> <C> <C>
/s/ UMESH PADVAL President and Chief Executive Officer and Director March 23, 2000
- ------------------------------- (Principal Executive Officer)
Umesh Padval
* Chairman of the Board of Directors March 23, 2000
- -------------------------------
Donald T. Valentine
/s/ ALEXANDRE A. BALKANSKI Director March 23, 2000
- -------------------------------
Alexandre A. Balkanski
* Director March 23, 2000
- -------------------------------
T. J. Rodgers
* Director March 23, 2000
- -------------------------------
Donald McKinney
* Director March 23, 2000
- -------------------------------
Baryn S. Futa
* Director March 23, 2000
- -------------------------------
Gregorio Reyes
*By: /s/ ALEXANDRE A.
BALKANSKI
- -------------------------------
Alexandre A. Balkanski
Attorney-in-Fact
</TABLE>
II-5
<PAGE> 7
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
C-Cube Microsystems Inc.:
We have audited the consolidated financial statements of C-Cube
Microsystems Inc. as of December 31, 1999 and 1998, and for each of the three
years in the period ended December 31, 1999, and have issued our report thereon
dated January 20, 2000 (February 10, 2000, as to Note 17). Our audits also
included the consolidated financial statement schedule of C-Cube Microsystems
Inc., listed in the Index at Item 14(a)(2). This consolidated financial
statement schedule is the responsibility of the Company's management. Our
responsibility is to express an opinion based on our audits. In our opinion,
such consolidated financial statement schedule, when considered in relation to
the basic consolidated financial statements taken as a whole, presents fairly in
all material respects the information set forth therein.
/s/ DELOITTE & TOUCHE LLP
- ---------------------------------------------
DELOITTE & TOUCHE LLP
San Jose, California
January 20, 2000
S-1
<PAGE> 8
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<TABLE>
<CAPTION>
ADDITIONS
------------------------
BALANCE AT CHARGED TO CHARGED TO DEDUCTIONS BALANCE
BEGINNING COSTS AND OTHER FROM AT END
OF PERIOD EXPENSES ACCOUNTS RESERVES OF PERIOD
---------- ---------- ---------- ---------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1999:
Sales returns allowance............ $13,124 $ 2,439 $ -- $8,798 $ 6,765
Allowance for doubtful accounts.... 3,910 300 -- -- 4,210
Warranty........................... 1,558 97 -- 348 1,307
YEAR ENDED DECEMBER 31, 1998:
Sales returns allowance............ $ 6,740 $12,553 $ -- $6,169 $13,124
Allowance for doubtful accounts.... 3,435 479 -- 4 3,910
Warranty........................... 1,573 316 -- 331 1,558
YEAR ENDED DECEMBER 31, 1997:
Sales returns allowance............ $11,529 $ 3,297 $ -- $8,086 $ 6,740
Allowance for doubtful accounts.... 2,563 1,010 -- 138 3,435
Warranty........................... 1,859 547 -- 833 1,573
</TABLE>
S-2
<PAGE> 9
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
-------------------
<C> <S>
3.1* Certificate of Incorporation of C-Cube Semiconductor Inc.
3.2* Bylaws of C-Cube Semiconductor Inc.
5.1** Form of Legal Opinion
8.1** Form of Tax Opinion
10.1** Form of Separation and Distribution Agreement between C-Cube
Microsystems Inc. and C-Cube Semiconductor Inc.
10.2** Form of Tax Sharing Agreement between C-Cube Microsystems
Inc. and C-Cube Semiconductor Inc.
10.3** Form of Assignment and Assumption Agreement between C-Cube
Microsystems Inc. and C-Cube Semiconductor Inc.
10.4** Form of Indemnification and Insurance Matters Agreement
between C-Cube Microsystems Inc. and C-Cube Semiconductor
Inc.
10.5** Form of Transitional Services Agreement between C-Cube
Microsystems Inc. and C-Cube Semiconductor Inc.
10.6* Form of Officers' and Directors' Indemnification Agreement.
10.7* Securities Purchase Agreement by and between C-Cube
Semiconductor Inc. and Thomson Multimedia S.A. dated as of
February 11, 2000.
10.8*+ Form of Warrant for Thomson Multimedia S.A.
10.9 2000 Stock Plan
10.10 Form of 2000 Stock Plan Agreement
10.11 2000 Employee Stock Purchase Plan
10.12 Form of 2000 Employee Stock Purchase Plan Agreement
10.13 2000 Director Option Plan
10.14 Form of 2000 Director Plan Agreement
21.1** List of Subsidiaries
23.1** Independent Auditors' Consent
24.1** Power of Attorney (see page II-5)
</TABLE>
- ------------------------
* Previously filed as an exhibit to Semiconductor's Registration Statement on
Form 10.
** Previously filed as an exhibit to Semiconductor's Registration Statement on
Form S-1.
+ Confidential treatment.
<PAGE> 1
Exhibit 4.2
COMMON STOCK COMMON STOCK
C-CUBE SEMICONDUCTOR INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
CUSIP
FULLY PAID AND NON-ASSESSABLE SHARES OF THE COMMON STOCK $.001 PAR VALUE
PER SHARE OF
C-CUBE SEMICONDUCTOR INC.
CERTIFICATE OF STOCK
/s/ LARRY W. SONSINI [SEAL] /s/ UMESH PADVAL
CORPORATE SECRETARY PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE> 2
A statement of the powers, designations, preferences and relative,
participating, optional or other special rights of each class of stock or notice
thereof and the qualifications, limitations or restrictions of such preferences
and/or rights as established, from time to time, by the Certificate of
Incorporation of the Corporation and by any certificate of determination, the
number of shares constituting each class and series, and the designations
thereof, may be obtained by the holder hereof upon request and without charge at
the principal office of the Corporation.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of
survivorship and not as tenants
in common
UNIF GIFT MIN ACT -- _____________ Custodian ____________
(Cust) (Minor)
under Uniform Gifts to Minors
Act _______________________
(State)
UNIF TRF MIN ACT -- ______________ Custodian (until age ___)
(Cust)
______________ under Uniform Transfers
(Minor)
to Minors Act __________________________
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, ________________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- -------------------------------------
- -------------------------------------
- --------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- ------------------------------------------------------------------------ Shares
of the common stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint
- --------------------------------------------------------------------- Attorney
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.
Dated
--------------------------------
------------------------------------------------------------
NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the
Certificate in every particular, without aboration
or enlargement or any change whatever.
Signature(s) Guaranteed:
BY:
THE SIGNATURE SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP
IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM). PURSUANT TO S.E.C. RULE
17Ad-15.
<PAGE> 1
EXHIBIT 10.9
C-CUBE SEMICONDUCTOR INC.
2000 STOCK PLAN
1. Purposes of the Plan. The purposes of this 2000 Stock Plan are:
- to attract and retain the best available personnel for
positions of substantial responsibility,
- to provide additional incentive to Employees, Directors and
Consultants, and
- to promote the success of the Company's business.
Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options, as determined by the Administrator at the time of
grant.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees as
shall be administering the Plan, in accordance with Section 4 of the Plan.
(b) "Applicable Laws" means the requirements relating to the
administration of stock option plans under U. S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options are, or will be, granted under
the Plan.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means a committee of Directors appointed by the
Board in accordance with Section 4 of the Plan.
(f) "Common Stock" means the common stock of the Company.
(g) "Company" means C-Cube Semiconductor Inc., Inc., a Delaware
corporation.
(h) "Consultant" means any person, including an advisor, engaged
by the Company or a Parent or Subsidiary to render services to such entity.
(i) "Director" means a member of the Board.
(j) "Disability" means total and permanent disability as defined
in Section 22(e)(3) of the Code.
<PAGE> 2
(k) "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, three (3) months following the 91st day of such
leave any Incentive Stock Option held by the Optionee shall cease to be treated
as an Incentive Stock Option and shall be treated for tax purposes as a
Nonstatutory Stock Option. Neither service as a Director nor payment of a
director's fee by the Company shall be sufficient to constitute "employment" by
the Company.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(m) "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:
(i) 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 prior to the time of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems
reliable;
(ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable; or
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.
(n) "Incentive Stock Option" means an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code and
the regulations promulgated thereunder.
(o) "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
(p) "Notice of Grant" means a written or electronic notice
evidencing certain terms and conditions of an individual Option or grant. The
Notice of Grant is part of the Option Agreement.
(q) "Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
-2-
<PAGE> 3
(r) "Option" means a stock option granted pursuant to the Plan.
(s) "Option Agreement" means an agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
The Option Agreement is subject to the terms and conditions of the Plan.
(t) "Option Exchange Program" means a program whereby outstanding
Options are surrendered in exchange for Options with a lower exercise price.
(u) "Optioned Stock" means the Common Stock subject to an Option.
(v) "Optionee" means the holder of an outstanding Option granted
under the Plan.
(w) "Parent" means a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.
(x) "Plan" means this 2000 Stock Plan.
(y) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
(z) "Section 16(b) " means Section 16(b) of the Exchange Act.
(aa) "Service Provider" means an Employee, Director or Consultant.
(bb) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.
(cc) "Subsidiary" means a "subsidiary corporation", whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 13
of the Plan, the maximum aggregate number of Shares that may be optioned and
sold under the Plan is 25,000,000 Shares, plus an annual increase to be added on
the first day of the Company's fiscal year (beginning 2001) equal to the lesser
of (i) 2,000,000 shares, (ii) three percent (3%) of the number outstanding
shares on the last day of the immediately preceding fiscal year, or (iii) a
lesser amount determined by the Board. The Shares may be authorized, but
unissued, or reacquired Common Stock.
If an Option expires or becomes unexercisable without having been
exercised in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated); provided,
however, that Shares that have actually been issued under the Plan, upon
exercise of an Option, shall not be returned to the Plan and shall not become
available for future distribution under the Plan, except that if unvested Shares
are repurchased by the Company at their original purchase price, such Shares
shall become available for future grant under the Plan.
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<PAGE> 4
4. Administration of the Plan.
(a) Procedure.
(i) Multiple Administrative Bodies. Different Committees
with respect to different groups of Service Providers may administer the Plan.
(ii) Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee of two or more "outside
directors" within the meaning of Section 162(m) of the Code.
(iii) Rule 16b-3. To the extent desirable to qualify
transactions hereunder as exempt under Rule 16b-3, the transactions contemplated
hereunder shall be structured to satisfy the requirements for exemption under
Rule 16b-3.
(iv) Other Administration. Other than as provided above, the
Plan shall be administered by (A) the Board or (B) a Committee, which committee
shall be constituted to satisfy Applicable Laws.
(b) Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:
(i) to determine the Fair Market Value;
(ii) to select the Service Providers to whom Options may be
granted hereunder;
(iii) to determine the number of shares of Common Stock to be
covered by each Option granted hereunder;
(iv) to approve forms of agreement for use under the Plan;
(v) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any Option granted hereunder. Such terms and
conditions include, but are not limited to, the exercise price, the time or
times when Options may be exercised (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions, and
any restriction or limitation regarding any Option or the shares of Common Stock
relating thereto, based in each case on such factors as the Administrator, in
its sole discretion, shall determine;
(vi) to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option shall have declined since the date the Option was granted;
(vii) to institute an Option Exchange Program;
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<PAGE> 5
(viii) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;
(ix) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred treatment under foreign
laws;
(x) to modify or amend each Option (subject to Section
15(c) of the Plan), including the discretionary authority to extend the
post-termination exercisability period of Options longer than is otherwise
provided for in the Plan;
(xi) to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option that number of Shares having a Fair Market
Value equal (or less than) to the minimum amount required to be withheld. The
Fair Market Value of the Shares to be withheld shall be determined on the date
that the amount of tax to be withheld is to be determined. All elections by an
Optionee to have Shares withheld for this purpose shall be made in such form and
under such conditions as the Administrator may deem necessary or advisable;
(xii) to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option previously
granted by the Administrator;
(xiii) to make all other determinations deemed necessary or
advisable for administering the Plan.
(c) Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options.
5. Eligibility. Nonstatutory Stock Options may be granted to Service
Providers. Incentive Stock Options may be granted only to Employees.
6. Limitations.
(a) Each Option shall be designated in the Option Agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.
(b) Neither the Plan nor any Option shall confer upon an Optionee
any right with respect to continuing the Optionee's relationship as a Service
Provider with the Company, nor shall they interfere in any way with the
Optionee's right or the Company's right to terminate such relationship at any
time, with or without cause.
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<PAGE> 6
(c) The following limitations shall apply to grants of Options:
(i) No Service Provider shall be granted, in any fiscal
year of the Company, Options to purchase more than 500,000 Shares.
(ii) In reply to: connection with his or her initial
service, a Service Provider may be granted Options to purchase up to an
additional 500,000 Shares, which shall not count against the limit set forth in
subsection (i) above.
(iii) The foregoing limitations shall be adjusted
proportionately in connection with any change in the Company's capitalization as
described in Section 13.
(iv) If an Option is cancelled in the same fiscal year of
the Company in which it was granted (other than in connection with a transaction
described in Section 13), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option.
7. Term of Plan. Subject to Section 19 of the Plan, the Plan shall
become effective upon its adoption by the Board. It shall continue in effect for
a term of ten (10) years unless terminated earlier under Section 15 of the Plan.
8. Term of Option. The term of each Option shall be stated in the
Option Agreement. In the case of an Incentive Stock Option, the term shall be
ten (10) years from the date of grant or such shorter term as may be provided in
the Option Agreement. Moreover, in the case of an Incentive Stock Option granted
to an Optionee who, at the time the Incentive Stock Option is granted, owns
stock representing more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or any Parent or Subsidiary, the
term of the Incentive Stock Option shall be five (5) years from the date of
grant or such shorter term as may be provided in the Option Agreement.
9. Option Exercise Price and Consideration.
(a) Exercise Price. The per share exercise price for the Shares to
be issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:
(i) In the case of an Incentive Stock Option
(1) granted to an Employee who, at the time the
Incentive Stock Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall be no less than 110% of the
Fair Market Value per Share on the date of grant.
(2) granted to any Employee other than an Employee
described in paragraph (A) immediately above, the per Share exercise price shall
be no less than 100% of the Fair Market Value per Share on the date of grant.
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<PAGE> 7
(ii) In the case of a Nonstatutory Stock Option, the per
Share exercise price shall be determined by the Administrator. In the case of a
Nonstatutory Stock Option intended to qualify as "performance-based
compensation" within the meaning of Section 162(m) of the Code, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.
(iii) Notwithstanding the foregoing, Options may be granted
with a per Share exercise price of less than 100% of the Fair Market Value per
Share on the date of grant pursuant to a merger or other corporate transaction.
(b) Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions that must be satisfied before the
Option may be exercised.
(c) Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) other Shares which (A) in the case of Shares acquired
upon exercise of an option, have been owned by the Optionee for more than six
months on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;
(v) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;
(vi) a reduction in the amount of any Company liability to
the Optionee, including any liability attributable to the Optionee's
participation in any Company-sponsored deferred compensation program or
arrangement;
(vii) any combination of the foregoing methods of payment; or
(viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.
10. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. Unless the
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<PAGE> 8
Administrator provides otherwise, vesting of Options granted hereunder shall be
tolled during any unpaid leave of absence. An Option may not be exercised for a
fraction of a Share.
An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 13 of the Plan.
Exercising an Option in any manner shall decrease the number
of Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.
(b) Termination of Relationship as a Service Provider. If an
Optionee ceases to be a Service Provider, other than upon the Optionee's death
or Disability, the Optionee may exercise his or her Option within such period of
time as is specified in the Option Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence of
a specified time in the Option Agreement, the Option shall remain exercisable
for three (3) months following the Optionee's termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
(c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
(d) Death of Optionee. If an Optionee dies while a Service
Provider, the Option may be exercised within such period of time as is specified
in the Option Agreement (but in no event
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<PAGE> 9
later than the expiration of the term of such Option as set forth in the Notice
of Grant) but only to the extent that the Option is vested on the date of death.
In the absence of a specified time in the Option Agreement, the Option shall
remain exercisable for twelve (12) months following the Optionee's death. The
Option may be exercised by the Optionee's designated beneficiary, provided such
beneficiary has been designated prior to Optionee's death in a form acceptable
by the Administrator. If no such beneficiary has been designated by the
Optionee, then such Option may be exercised within the applicable time period by
the personal representative of the Optionee's estate or by the person or persons
to whom the Option is transferred pursuant to the Optionee's will or in
accordance with the laws of descent and distribution. If, at the time of death,
the Optionee is not vested as to his or her entire Option, the Shares covered by
the unvested portion of the Option shall immediately revert to the Plan. If the
Option is not so exercised within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
(e) Buyout Provisions. The Administrator may at any time offer to
buy out for a payment in cash or Shares an Option previously granted based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.
11. Non-Transferability of Options. Unless determined otherwise by the
Administrator, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee. If the Administrator makes an Option
transferable, such Option shall contain such additional terms and conditions as
the Administrator deems appropriate.
12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
(a) Changes in Capitalization. Subject to any required action by
the shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, 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 issued 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 Board,
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 Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to
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<PAGE> 10
such transaction as to all of the Optioned Stock covered thereby, including
Shares as to which the Option would not otherwise be exercisable. In addition,
the Administrator may provide that any Company repurchase option applicable to
any Shares purchased upon exercise of an Option shall lapse as to all such
Shares, provided the proposed dissolution or liquidation takes place at the time
and in the manner contemplated. To the extent it has not been previously
exercised, an Option will terminate immediately prior to the consummation of
such proposed action.
(c) Transfer of Control.
(i) 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 shareholders 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 Subsidiaries);
(d) the direct or indirect sale or exchange by the
shareholders of the Company of all or substantially all of the stock of the
Company where the shareholders 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.
(ii) In the event of a Transfer of Control of the Company,
each outstanding Option will be assumed or an equivalent option substituted by
the successor corporation or a parent or Subsidiary of the successor corporation
(the "Successor Corporation"). In the event that an Option is not assumed or
substituted for, such Option shall terminate as of the date of the Transfer of
Control. For the purposes of this paragraph, the Option shall be considered
assumed if, following the Transfer of Control, the option confers the right to
purchase or receive, for each Share of Optioned Stock subject to the Option
immediately prior to the Transfer of Control the consideration (whether stock,
cash, or other securities or property) received in the Transfer of Control by
holders of Common Stock for each Share held on the effective date of the
transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Transfer of
Control was not solely common stock of the Successor Corporation, the
Administrator may, with the consent of the Successor Corporation, provide for
the consideration to be received upon the exercise of the Option for each Share
of Optioned Stock subject to the Option to be solely common stock of the
Successor Corporation equal in fair market value to the per share consideration
received by holders of Common Stock in the Transfer of Control.
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<PAGE> 11
13. Date of Grant. The date of grant of an Option shall be, for all
purposes, the date on which the Administrator makes the determination granting
such Option, or such other later date as is determined by the Administrator.
Notice of the determination shall be provided to each Optionee within a
reasonable time after the date of such grant.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan.
(b) Shareholder Approval. The Company shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.
(c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to Options granted under the
Plan prior to the date of such termination.
15. Conditions Upon Issuance of Shares.
(a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option unless the exercise of such Option and the issuance and
delivery of such Shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
(b) Investment Representations. 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.
16. Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.
17. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan. 18. Shareholder Approval.
The Plan shall be subject to approval by the shareholders of the Company within
twelve (12) months after the date the Plan is adopted. Such shareholder approval
shall be obtained in the manner and to the degree required under Applicable
Laws.
18. Shareholder Approval. The Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months after the date the Plan is
adopted. Such shareholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.
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<PAGE> 1
EXHIBIT 10.10
C-CUBE SEMICONDUCTOR INC.
2000 STOCK PLAN
STOCK OPTION AGREEMENT
Unless otherwise defined herein, the terms defined in the Plan shall have
the same defined meanings in this Option Agreement.
I. NOTICE OF STOCK OPTION GRANT
[Optionee's Name and Address]
You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:
Grant Number
-------------------------------------
Date of Grant
-------------------------------------
Vesting Commencement Date
-------------------------------------
Exercise Price per Share
$-------------------------------------
Total Number of Shares Granted
-------------------------------------
Total Exercise Price
$-------------------------------------
Type of Option: Incentive Stock Option
-----
Nonstatutory Stock Option
-----
Term/Expiration Date:
-------------------------------------
Vesting Schedule:
Subject to accelerated vesting as set forth below, this Option may be
exercised, in whole or in part, in accordance with the following schedule:
[25% OF THE SHARES SUBJECT TO THE OPTION SHALL VEST TWELVE MONTHS AFTER
THE VESTING COMMENCEMENT DATE, AND 1/48 OF THE SHARES SUBJECT TO THE OPTION
SHALL VEST EACH MONTH THEREAFTER, SUBJECT TO THE OPTIONEE CONTINUING TO BE A
SERVICE PROVIDER ON SUCH DATES].
<PAGE> 2
Termination Period:
This Option may be exercised for three months after Optionee ceases to be
a Service Provider. Upon the death or Disability of the Optionee, this Option
may be exercised for twelve months after Optionee ceases to be a Service
Provider. In no event shall this Option be exercised later than the
Term/Expiration Date as provided above.
II. AGREEMENT
A. Grant of Option.
The Plan Administrator of the Company hereby grants to the Optionee
named in the Notice of Grant attached as Part I of this Agreement (the
"Optionee") an option (the "Option") to purchase the number of Shares, as set
forth in the Notice of Grant, at the exercise price per share set forth in the
Notice of Grant (the "Exercise Price"), subject to the terms and conditions of
the Plan, which is incorporated herein by reference. Subject to Section 14(c) of
the Plan, in the event of a conflict between the terms and conditions of the
Plan and the terms and conditions of this Option Agreement, the terms and
conditions of the Plan shall prevail.
If designated in the Notice of Grant as an Incentive Stock Option
("ISO"), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive
Stock Option, to the extent that it exceeds the $100,000 rule of Code Section
422(d) it shall be treated as a Nonstatutory Stock Option ("NSO").
B. Exercise of Option.
(a) Right to Exercise. This Option is exercisable during its term
in accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.
(b) Method of Exercise. This Option is exercisable by delivery of
an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to the Stock Plan Administrator of the Company.
The Exercise Notice shall be accompanied by payment of the aggregate Exercise
Price as to all Exercised Shares, and any and all withholding taxes. This Option
shall be deemed to be exercised upon receipt by the Company of such fully
executed Exercise Notice accompanied by such aggregate Exercise Price and
applicable withholding taxes.
No Shares shall be issued pursuant to the exercise of this
Option unless such issuance and exercise complies with Applicable Laws. Assuming
such compliance, for income tax purposes the Exercised Shares shall be
considered transferred to the Optionee on the date the Option is exercised with
respect to such Exercised Shares.
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<PAGE> 3
C. Method of Payment.
Payment of the aggregate Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee:
1. cash; or
2. check; or
3. consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan.
D. Non-Transferability of Option.
This Option may not be transferred in any manner otherwise than by
will or by the laws of descent or distribution and may be exercised during the
lifetime of Optionee only by the Optionee. The terms of the Plan and this Option
Agreement shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.
E. Term of Option.
This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with
the Plan and the terms of this Option Agreement.
F. Tax Obligations.
1. Withholding Taxes. Optionee agrees to make appropriate
arrangements with the Company (or the Parent or Subsidiary employing or
retaining Optionee) for the satisfaction of all Federal, state, local and
foreign income and employment tax withholding requirements applicable to the
Option exercise. Optionee acknowledges and agrees that the Company may refuse to
honor the exercise and refuse to deliver Shares if such withholding amounts are
not delivered at the time of exercise.
2. Notice of Disqualifying Disposition of ISO Shares. If the
Option granted to Optionee herein is an ISO, and if Optionee sells or otherwise
disposes of any of the Shares acquired pursuant to the ISO on or before the
later of (1) the date two years after the Date of Grant, or (2) the date one
year after the date of exercise, the Optionee shall immediately notify the
Company in writing of such disposition. Optionee agrees that Optionee may be
subject to income tax withholding by the Company on the compensation income
recognized by the Optionee.
G. Entire Agreement; Governing Law.
The Plan is incorporated herein by reference. The Plan and this
Option Agreement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and Optionee with respect to the subject matter
hereof, and may not be modified adversely to the Optionee's interest except by
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<PAGE> 4
means of a writing signed by the Company and Optionee. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.
H. NO GUARANTEE OF CONTINUED SERVICE.
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT
TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE
PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED,
BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED
HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS
OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING
PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT
OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIP AS A SERVICE
PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.
By your signature and the signature of the Company's representative below,
you and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.
OPTIONEE: C-CUBE SEMICONDUCTOR INC.
- ------------------------------------- -------------------------------------
Signature By
- ------------------------------------- -------------------------------------
Print Name Title
- -------------------------------------
Residence Address
- -------------------------------------
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<PAGE> 5
CONSENT OF SPOUSE
The undersigned spouse of Optionee has read and hereby approves the terms
and conditions of the Plan and this Option Agreement. In consideration of the
Company's granting his or her spouse the right to purchase Shares as set forth
in the Plan and this Option Agreement, the undersigned hereby agrees to be
irrevocably bound by the terms and conditions of the Plan and this Option
Agreement and further agrees that any community property interest shall be
similarly bound. The undersigned hereby appoints the undersigned's spouse as
attorney-in-fact for the undersigned with respect to any amendment or exercise
of rights under the Plan or this Option Agreement.
-------------------------------------
Spouse of Optionee
<PAGE> 6
EXHIBIT A
C-CUBE SEMICONDUCTOR INC.
2000 STOCK PLAN
EXERCISE NOTICE
C-Cube Semiconductor Inc.
1778 McCarthy Blvd.
Milpitas, CA 95305
Attention: Stock Plan Administrator
1. Exercise of Option. Effective as of today, ________________, _____,
the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of C-Cube Semiconductor Inc. (the "Company")
under and pursuant to the 2000 Stock Plan (the "Plan") and the Stock Option
Agreement dated, _____ (the "Option Agreement"). The purchase price for the
Shares shall be $_____, as required by the Option Agreement.
2. Delivery of Payment. Purchaser herewith delivers to the Company the
full purchase price for the Shares, and any and all withholding taxes due in
connection with the purchase of the Shares.
3. Representations of Purchaser. Purchaser acknowledges that Purchaser
has received, read and understood the Plan and the Option Agreement and agrees
to abide by and be bound by their terms and conditions.
4. Rights as Shareholder. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 14 of the
Plan.
5. Tax Consultation. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.
<PAGE> 7
6. Entire Agreement; Governing Law. The Plan and Option Agreement are
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser's interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.
Submitted by: Accepted by:
PURCHASER: C-CUBE SEMICONDUCTOR INC.
- ------------------------------------- -------------------------------------
Signature Signature
- ------------------------------------- -------------------------------------
Print Name Title
Address: Address:
- ------------------------------------- C-CUBE SEMICONDUCTOR INC.
1778 McCarthy Blvd.
- ------------------------------------- Milpitas, CA 95305
-------------------------------------
Date Received
<PAGE> 1
EXHIBIT 10.11
C-CUBE SEMICONDUCTOR INC.
EMPLOYEE STOCK PURCHASE PLAN
The following constitute the provisions of the Employee Stock Purchase
Plan of C-Cube Semiconductor 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) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(c) "Common Stock" shall mean the Common Stock of the Company.
(d) "Company" shall mean C-Cube Semiconductor Inc. and any
Designated Subsidiary of the Company.
(e) "Compensation" shall mean all base straight time gross
earnings, commissions, overtime, profit sharing and bonuses, but exclusive of
payments for shift premium, incentive compensation, incentive payments and other
compensation.
(f) "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.
(g) "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.
(h) "Enrollment Date" shall mean the first day of each Offering
Period.
(i) "Exercise Date" shall mean the last Trading Day of each
Purchase Period.
(j) "Fair Market Value" shall mean, as of any date, the value of
Common Stock determined as follows:
<PAGE> 2
(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 Administrator 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 Board 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
Board.
(k) "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 approximately twenty-four months later; provided, however, the first
Offering Period under the Plan shall commence on the first Trading Day following
the spin-off of the Company from C-Cube Microsystems Inc. and continue until
January 31, 2002. The duration and timing of Offering Periods may be changed
pursuant to Section 4 of this Plan.
(l) "Plan" shall mean this Employee Stock Purchase Plan.
(m) "Purchase Price" shall mean 85% of the lower of the Fair
Market Value of a share of Common Stock on (i) the day prior to the Enrollment
Date or (ii) on the Exercise Date, unless otherwise provided in Section 13(b)
hereof.
(n) "Purchase Period" shall mean the approximately six month
period commencing on one Exercise Date and ending with the next Exercise Date.
However, the first Purchase Period under the Plan shall commence on the first
Trading Day following the spin-off of the Company from C-Cube Microsystems Inc.
and end on July 31, 2000.
(o) "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.
(p) "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.
(q) "Trading Day" shall mean a day on which national stock
exchanges and the Nasdaq System are open for trading.
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<PAGE> 3
3. Eligibility.
(a) Any Employee who shall be employed by the Company on a given
Enrollment Date shall be eligible to participate in the Plan.
(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 of 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 on the first Trading Day following the
spin-off of the Company from C-Cube Microsystems Inc. and continue until January
31, 2002. The duration and timing of Offering Periods may be changed pursuant to
Section 4 of this Plan.
5. Participation.
(a) An eligible Employee may become a participant in the Plan by
completing a subscription agreement in the form of Exhibit A attached to this
Plan and filing it with the Company's stock administrator prior to the
applicable Enrollment Date. Such subscription agreement shall (without
limitation) authorize payroll deductions and, with respect to the first Offering
Period under the Plan and subject to Section 5(c) below, indicate the amount of
additional funds, if any, the Employee elects to contribute to the purchase of
shares of Common Stock under the Plan. Any such additional funds must be
delivered to the Company at such time and in such manner as the Company shall
specify.
(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.
(c) In addition to Employee's authorized payroll deductions, an
eligible Employee may contribute up to $3,000 to the purchase of shares under
the first Offering Period in effect under Plan. Such contribution shall be made
in any of the following forms of consideration: (i) cash, (ii) check made
payable to the Company, or (iii) accumulated payroll deductions in
-3-
<PAGE> 4
Employee's account under the C-Cube Microsystems Inc. Employee Stock Purchase
Plan as of the effective date of the spin-off of the Company from C-Cube
Microsystems Inc.
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 ten percent (10%) 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. Subject to Section 5(c) above, 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 Board 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 shall not be obligated to, withhold from the participant's
compensation the amount necessary 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 the amount retained in the Employee's account prior
to the Exercise Date pursuant to the Employee's accumulated payroll deductions
and, with respect to the first Offering Period, any amounts contributed by the
Employee
-4-
<PAGE> 5
pursuant to Section 5(c), by the applicable Purchase Price; provided that in no
event shall an Employee be permitted to purchase during each Purchase Period
more than 10,000 shares of the Company's Common Stock (subject to any adjustment
pursuant to Section 19), 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.
(a) Unless a participant withdraws from the Plan as provided in
Section 10 hereof, his or her option for the purchase of shares shall 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 amount retained in the participant's account
as of the Exercise Date pursuant to the participant's accumulated payroll
deductions and, with respect to the first Offering Period, any amounts
contributed by the participant pursuant to Section 5(c). No fractional shares
shall be purchased; any amounts in a participant's account which are not
sufficient to purchase a full share shall 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.
(b) The participant shall have no interest or voting right in
shares covered by his option until such option has been exercised.
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. 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.
10. Withdrawal.
(a) A participant may withdraw all but not less than all of the
amounts 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 attached to this Plan. All of the amounts credited to the
participant's 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.
(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
-5-
<PAGE> 6
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 amounts
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 either the amounts contributed
by participant pursuant to Section 5(c) or the payroll deductions of a
participant in the Plan.
13. Stock.
(a) Subject to adjustment upon changes in capitalization of the
Company as provided in Section 19 hereof, the maximum number of shares of the
Company's Common Stock which shall be made available for sale under the Plan
shall initially be no more than five hundred thousand (500,000) shares, plus an
annual increase to be added on the first day of the Company's fiscal year
(beginning 2001) equal to the lesser of (i) 600,000 shares, (ii) one percent
(1%) of the number of outstanding shares on the last Trading Day of the
immediately preceding fiscal year 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) If, the Board determines that, on a given Exercise Date, the
number of shares with respect to which options are to be exercised may exceed
the number of shares of Common Stock that are available for sale under the Plan,
the Board may in its sole discretion (i) provide that the Company shall make a
pro rata allocation of the shares of Common Stock available for purchase in as
uniform a manner as shall be practicable and as it shall determine to be
equitable among all participants exercising options to purchase Common Stock on
such Exercise Date, notwithstanding any subsequent authorization of additional
shares of Common Stock for issuance under the Plan by the Company's
stockholders, (ii) provide that the Company shall make a pro rata allocation of
the shares available for purchase in as uniform a manner as shall be practicable
and as it shall determine to be equitable among all participants exercising
options to purchase Common Stock on such Exercise Date and terminate all
Offering Periods pursuant to Section 20 hereof or (iii) provide that, if the
Fair Market Value of a share of Common Stock on the date on which additional
shares of Common Stock are authorized for issuance hereunder by the Company's
stockholders (the "Authorization Date") is higher than the Fair Market Value of
a share of Common Stock on the Enrollment Date of any outstanding Offering
Period that commenced prior to the Authorization
-6-
<PAGE> 7
Date, the Purchase Price for authorized shares available to be issued on any
remaining Exercise Date of any Offering Period in effect on the Authorization
Date shall be 85% of the Fair Market Value of a share of Common Stock on the
Authorization Date or on the Exercise Date, whichever is lower.
14. Administration. 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 made by the Board or its committee shall, to the full extent
permitted by law, be final and binding upon all parties.
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, amounts contributed by participant pursuant to Section
5(c), 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 amounts held by the Company under the Plan
pursuant to either payroll deductions or contributions under Section 5(c) may be
used by the Company for any corporate purpose, and the Company shall not be
obligated to segregate such amounts.
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 set forth the amounts of
payroll deductions and, if applicable, contributions under Section 5(c), the
Purchase Price, the number of shares purchased and the remaining cash balance,
if any.
-7-
<PAGE> 8
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 (including the number of shares
that may be added annually to the Reserves pursuant to Section 13(a)(i)), 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 Board, 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> 9
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 Offering Period 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 or received by participant pursuant to Section 5(c),
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> 10
23. Term of Plan. The Plan shall become effective upon the effectiveness
of the spinoff of the Company from C-Cube Microsystems Inc. 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.
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<PAGE> 1
EXHIBIT 10.12
C-CUBE SEMICONDUCTOR INC.
EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_____ Original Application Enrollment Date: ___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)
1. ____________________ ("Employee") hereby elects to participate in the
C-Cube Semiconductor Inc. (the "Company") 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 (not to exceed 10%) during the
Offering Period in accordance with the Employee Stock Purchase Plan.
(Please note that no fractional percentages are permitted.)
3. I hereby elect to contribute an additional $_______________ (not to exceed
a total of $3,000 for both A. and B. below) to the purchase of shares of
common stock on the first Purchase Date to occur under the Employee Stock
Purchase Plan. Furthermore, I hereby agree to pay such amount as follows
(check all that apply):
[ ] A. I hereby authorize the Company to apply all of the accumulated
payroll deductions retained in my account under the C-Cube
Microsystems Inc. Employee Stock Purchase Plan as of the effective
date of the spin-off of the Company from C-Cube Microsystems Inc. to
the purchase of shares under the Company's Employee Stock Purchase
Plan.
[ ] B. Attached is a check in the amount of $_______________ made
payable to C-Cube Semiconductor Inc.
4. I understand that said payroll deductions and other contributions 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 and other contributions will be used to
automatically exercise my option.
5. 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.
<PAGE> 2
6. Shares purchased for me under the Employee Stock Purchase Plan should be
issued in the name(s) of [PLEASE PRINT]:
[ ] A. Employee:
----------------------------------------------------
[ ] B. Employee and Spouse: and
------------------- ------------------
7. 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 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.
8. 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.
9. 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> 3
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)
Employee ID Number:
-------------------------------------
Employee's Social Security Number:
-------------------------------------
Employee's Address:
-------------------------------------
-------------------------------------
-------------------------------------
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<PAGE> 4
EXHIBIT B
C-CUBE SEMICONDUCTOR INC.
EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
The undersigned participant in the Offering Period of the C-Cube
Semiconductor Inc. Employee Stock Purchase Plan which began on ,
------------
20 (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 and any
other amounts 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:
-------------------------------------
<PAGE> 1
EXHIBIT 10.13
C-CUBE SEMICONDUCTOR INC.
DIRECTORS STOCK OPTION PLAN
1. Purpose. The C-Cube Semiconductor Inc. Directors Stock Option Plan
(the "Plan") shall become effective upon the effectiveness of the spinoff of
C-Cube Semiconductor Inc. (the "Company") from C-Cube Microsystems Inc. (the
"Effective Date"). The purpose of the Plan is to create additional incentive for
the non-employee directors of the Company and any of its successor to promote
the financial success and progress of the Company and any present or future
parent and/or subsidiary corporations of the Company. For purposes of the Plan,
a parent corporation and a subsidiary corporation shall be as defined in
sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended (the
"Code").
2. Administration. The Plan shall be administered by the Company's
Board of Directors (the "Board") and/or by a duly appointed committee of the
Board having such powers as shall be specified by the Board. Any subsequent
references herein to the Board shall also mean the committee if such committee
has been appointed and, unless the powers of the committee have been
specifically limited, the committee shall have all of the powers of the Board
granted herein, including, without limitation, the power to terminate or amend
the Plan at any time, subject to the terms of the Plan and any applicable
limitations imposed by law. The Board shall have no authority, discretion, or
power to select the non-employee directors of the Company who will receive
options under the Plan, to set the exercise price of the options granted under
the Plan, to determine the number of shares of common stock to be granted under
option or the time at which such options are to be granted, to establish the
duration of option grants, or alter any other terms or conditions specified in
the Plan, except in the sense of administering the Plan subject to the
provisions of the Plan. All questions of interpretation of the Plan or of any
options granted under the Plan (an "Option") shall be determined by the Board,
and such determinations shall be final and binding upon all persons having an
interest in the Plan and/or any Option. Any officer of the Company shall have
the authority to act on behalf of the Company with respect to any matter, right,
obligation, or election which is the responsibility of or which is allocated to
the Company herein, provided the officer has apparent authority with respect to
such matter, right, obligation, or election.
3. Eligibility and Type of Option. Options may be granted only to
directors of the Company who, at the time of such grant, are not employees of
the Company or of any parent or subsidiary corporation of the Company ("Outside
Directors"). Options granted to Outside Directors shall be nonstatutory stock
options; that is, options which are not treated as having been granted under
section 422(b) of the Code.
4. Shares Subject to Option. Options shall be for the purchase of
shares of authorized but unissued common stock or treasury shares of common
stock of the Company (the "Stock"), subject to adjustment as provided in
paragraph 8 below. The maximum number of shares of Stock which may be issued
under the Plan shall be 450,000 shares. In the event that any outstanding Option
for any reason expires or is terminated and/or shares of Stock subject to
repurchase are repurchased by the Company, the shares allocable to the
unexercised portion of such Option, or such repurchased shares, may again be
subject to an Option grant.
<PAGE> 2
5. Time for Granting Options. All Options shall be granted, if at all,
within ten (10) years from the Effective Date.
6. Terms, Conditions and Form of Options. Options granted pursuant to
the Plan shall be evidenced by written agreements specifying the number of
shares of Stock covered thereby, in substantially the form attached hereto as
Exhibit A (the "Option Agreement"), which written agreement may incorporate all
or any of the terms of the Plan by reference and shall comply with and be
subject to the following terms and conditions:
(a) Automatic Grant of Options. Subject to execution by an Outside
Director of an appropriate Option Agreement, options shall be granted
automatically and without further action of the Board, as follows:
(i) On the Effective Date, each Outside Director holding
office on the Effective Date who does not then hold an option to acquire shares
of Stock shall be granted an Option to purchase Forty Thousand (40,000) shares
of Stock.
(ii) Each person who is newly elected or appointed as an
Outside Director after the Effective Date shall be granted an Option on the day
immediately following such initial election or appointment to purchase Forty
Thousand (40,000) shares of Stock.
(iii) Each Outside Director shall be granted on each Outside
Director's Anniversary Date an Option to purchase Ten Thousand (10,000) shares
of Stock. For purposes of this section, an Outside Director's Anniversary Date
shall be as follows:
(A) For an Outside Director holding office on the
Effective Date, the Anniversary Date shall be the date which is one year after
the Effective Date and successive annual anniversaries thereof.
(B) For each Outside Director who is first elected or
appointed after the Effective Date, the Anniversary Date shall be the date which
is one year after such election or appointment and successive annual
anniversaries thereof.
(iv) Notwithstanding the foregoing, any Outside Director may
elect not to receive an Option granted pursuant to this paragraph 6(a) by
delivering written notice of such election to the Board, which, in the case of
an initial Option grant, shall be no later than the Effective Date or the date
upon which such Outside Director is appointed or elected to the Board.
(v) Notwithstanding any other provision of the Plan to the
contrary, no Option shall be granted to any individual on a day when he or she
is no longer serving as an Outside Director of the Company.
(b) Option Exercise Price. The exercise price per share of Stock
subject to an Option shall be the fair market value of a share of the common
stock of the Company on the date of the granting of the Option. If the common
stock of the Company 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
-2-
<PAGE> 3
sales price for such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or system on the date of grant or, if the date of grant
does not fall on a day on which the common stock of the Company is traded, on
the last market trading day prior to the date of grant, as reported in The Wall
Street Journal or such other source as the Board deems reliable. If the common
stock of the Company is regularly quoted by a recognized securities dealer but
selling prices are not reported, the fair market value of a Share of common
stock of the Company shall be the mean between the high bid and low asked prices
for the common stock on the date of grant or, if the date of grant does not fall
on a day on which the common stock of the Company is traded, on the last market
trading day prior to the date of grant, as reported in The Wall Street Journal
or such other source as the Administrator deems reliable.
(c) Exercise Period and Exercisability of Options.
(i) An Option granted pursuant to the Plan shall be
exercisable for a term of ten (10) years.
(ii) Subject to section 6(c)(iii), Options granted pursuant
to Sections 6(a)(i) and 6(a)(ii) of the Plan shall first become exercisable on
the day (the "Initial Vesting Date") which is one year from the date on which
the Option was granted. The Option shall be exercisable on and after the Initial
Vesting Date and prior to termination of the Option in an amount equal to the
number of Option Shares multiplied by the Vested Ratio as set forth below, less
the number of shares previously acquired upon exercise of the Option.
Vested Ratio
(A) 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
(B) For each full month of the 1/48
Optionee's continuous service
as a director of the Company
from the Initial Vesting Date.
(iii) Notwithstanding anything contrary in this Plan, Options
granted pursuant to section 6(a)(i) to Outside Directors who were serving on the
Board of Directors of C-Cube Microsystems Inc. immediately prior to the
Effective Date shall vest and become exercisable
-3-
<PAGE> 4
in forty-eight (48) successive equal monthly installments upon the Optionee's
completion of each month of continuous service as a director measured from the
Effective Date.
(iv) Each ten thousand (10,000)-share option granted
pursuant to Section 6(a)(iii) shall become exercisable in forty-eight (48)
successive equal monthly installments upon the Optionee's completion of each
month of continuous service as a director measured from the option grant date.
(d) Payment of Option Exercise Price. Payment of the exercise
price for the number of shares of Stock being purchased pursuant to any Option
shall be made (i) in cash, by check, or in cash equivalent, (ii) by the
assignment of the proceeds of a sale of some or all of the shares being acquired
upon the exercise of an Option (including, without limitation, through an
exercise complying with the provisions of Regulation T as promulgated from time
to time by the Board of Governors of the Federal Reserve System), or (iii) by
any combination thereof. The Company reserves, at any and all times, the right,
in the Company's sole and absolute discretion, to establish, decline to approve
and/or terminate any program and/or procedure for the exercise of Options by
means of an assignment of the proceeds of a sale of some or all of the shares of
Stock to be acquired upon such exercise.
(e) 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:
(i) a merger or consolidation in which the Company is not
the surviving corporation;
(ii) 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;
(iii) 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 paragraph 1 above) of the
Company;
(iv) 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
(v) 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 outstanding Options or substitute options for the Acquiring
Corporation's stock for such outstanding Options. In the event of a Transfer of
Control which occurs more than two years after the date the Plan is adopted, the
Board shall provide that any
-4-
<PAGE> 5
unexercisable and/or unvested portion of the outstanding Options shall be
immediately exercisable and vested as of a date prior to the Transfer of
Control, as the Board shall specify. The exercise and/or vesting that was
permissible solely by reason of this paragraph 6(e)(v) shall be conditioned upon
the consummation of the Transfer of Control. Any Options which are neither
assumed or substituted for by the Acquiring Corporation nor exercised as of the
date of the Transfer of Control shall terminate and cease to be outstanding
effective as of the date of the Transfer of Control.
(f) Stockholder Approval Any Option granted pursuant to the Plan
shall be subject to obtaining stockholder approval of the Plan prior to the
grant thereof.
7. Authority to Vary Terms. The Board shall have the authority from
time to time to vary the terms of the Option Agreements either in connection
with the grant of an individual Option or in connection with the authorization
of a new standard form or forms; provided, however, that the terms and
conditions of such revised or amended standard form or forms of stock option
agreement shall be in accordance with the terms of the Plan. Such authority
shall include, but not by way of limitation, the authority to grant Options
which are immediately exercisable subject to the Company's right to repurchase
any unvested shares of Stock acquired by the Optionee on exercise of an Option
in the event such Optionee's service as a director of the Company is terminated
for any reason.
8. Effect of Change in Stock Subject to Plan. Appropriate adjustments
shall be made in the number and class of shares of Stock subject to the Plan,
the number of shares to be granted under the Plan and to any outstanding Options
and in the Option exercise price of any outstanding Options in the event of a
stock dividend, stock split, recapitalization, reverse stock split, combination,
reclassification, or like change in the capital structure of the Company.
9. Options Non-Transferable. Unless otherwise determined by the
Administrator, an Option shall not be assignable or transferable by the
Optionee, except by will or by the laws of descent and distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee. If the
Administrator makes an Option transferable, such Option shall contain such
additional terms and conditions as the Administrator deems appropriate.
10. Termination or Amendment of Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend, or discontinue the Plan, but no amendment, alteration,
suspension, or discontinuation shall be made which would impair the rights of
any Optionee under any grant theretofore made, without his or her consent. In
addition, to the extent necessary and desirable to comply with any applicable
law, regulation or stock exchange rule, the Company shall obtain stockholder
approval of any Plan amendment in such a manner and to such a degree as
required.
(b) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated.
-5-
<PAGE> 1
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.
<PAGE> 2
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.
<PAGE> 3
(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.
<PAGE> 4
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
<PAGE> 5
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:
----------------------------------
Title:
-------------------------------
<PAGE> 6
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
<PAGE> 7
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:
----------------------
Date of Option Agreement:
--------------
Shares Being Purchased:
----------------
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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