PIXELWORKS, INC.
AMENDED AND RESTATED 2006 STOCK INCENTIVE PLAN
TERMS AND CONDITIONS OF OPTION GRANT
These Terms and
Conditions of Option Grant (these “ Terms ”)
apply to a particular stock option (the “ Option
”) if referenced in the Notice of Grant of Stock Options (the
“ Grant Notice ”) corresponding to that
particular grant. The recipient of the Option identified in the
Grant Notice is referred to as the “ Grantee .”
The per share exercise price of the Option as set forth in the
Grant Notice is referred to as the “ Exercise Price
.” The effective date of grant of the Option as set forth in
the Grant Notice is referred to as the “ Award Date
.” The exercise price and the number of shares covered by the
Option are subject to adjustment under Section 11 of the
Plan.
The Option was
granted under and subject to the Pixelworks, Inc. Amended and
Restated 2006 Stock Incentive Plan (the “ Plan
”). Capitalized terms are defined in the Plan if not defined
herein. The Option has been granted to the Grantee in addition to,
and not in lieu of, any other form of compensation otherwise
payable or to be paid to the Grantee. The Grant Notice and these
Terms are collectively referred to as the “ Option
Agreement ” applicable to the Option.
2.
Vesting; Limits on Exercise; Incentive Stock Option Status
.
The Option shall
vest and become exercisable in percentage installments of the
aggregate number of shares subject to the Option as set forth on
the Grant Notice. The Option may be exercised only to the extent
the Option is vested and exercisable.
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Cumulative Exercisability
. To the extent that the
Option is vested and exercisable, the Grantee has the right to
exercise the Option (to the extent not previously exercised), and
such right shall continue, until the expiration or earlier
termination of the Option.
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No Fractional Shares
. Fractional share
interests shall be disregarded, but may be cumulated.
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Minimum Exercise
. No fewer than 100
shares of Common Stock (subject to adjustment under Section 11
of the Plan) may be purchased at any one time, unless the number
purchased is the total number at the time exercisable under the
Option.
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Incentive Stock Option Status;
$100,000 Value Limit . The Grant Notice indicates
whether the Option is intended as an Incentive Stock Option (within
the meaning of Section 422 of the U.S. Internal Revenue Code)
or a Nonqualified Stock Option. If the Option is intended to
qualify as an Incentive Stock Option and the aggregate fair market
value of the shares with respect to which Incentive Stock Options
(whether granted under the Option or otherwise) first become
exercisable by the Grantee in any
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calendar year exceeds $100,000, as
measured on the applicable Award Dates, the limitations of
Section 5.2 of the Plan shall apply and to such extent the
Option will be rendered a Nonqualified Stock Option.
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3.
Continuance of Employment/Service Required; No
Employment/Service Commitment .
The vesting
schedule applicable to the Option requires Continuous Status as an
Employee or Consultant through each applicable vesting date as a
condition to the vesting of the applicable installment of the
Option and the rights and benefits under this Option Agreement.
Employment or service for only a portion of the vesting period,
even if a substantial portion, will not entitle the Grantee to any
proportionate vesting or avoid or mitigate a termination of rights
and benefits upon or following a termination of employment or
services as provided in Section 5 below or under the
Plan.
Nothing contained
in this Option Agreement or the Plan constitutes a continued
employment or service commitment by the Company or any of its
Subsidiaries, affects the Grantee’s status, if he or she is
an employee, as an employee at will who is subject to termination
without cause, confers upon the Grantee any right to remain
employed by or in service to the Company or any Subsidiary,
interferes in any way with the right of the Company or any
Subsidiary at any time to terminate such employment or service, or
affects the right of the Company or any Subsidiary to increase or
decrease the Grantee’s other compensation.
4. Method
of Exercise of Option .
The Option shall
be exercisable by the delivery to the Secretary of the Company (or
such other person as the Administrator may require pursuant to such
administrative exercise procedures as the Administrator may
implement from time to time) of:
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a
written notice stating the number of shares of Common Stock to be
purchased pursuant to the Option or by the completion of such other
administrative exercise procedures as the Administrator may require
from time to time,
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payment in full for the Exercise
Price of the shares to be purchased in cash, check or by electronic
funds transfer to the Company, or (subject to compliance with all
applicable laws, rules, regulations and listing requirements and
further subject to such rules as the Administrator may adopt as to
any non-cash payment) in shares of Common Stock already owned by
the Grantee, valued at their fair market value (as determined under
the Plan) on the exercise date;
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any
written statements or agreements required pursuant to
Section 16.1 of the Plan; and
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satisfaction of the tax withholding
provisions of Section 10 of these Terms.
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The
Administrator also may, but is not required to, authorize a
no
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