Exhibit 10.2
DSP GROUP, INC.
1993 DIRECTOR STOCK OPTION
PLAN
(Amended and Restated July 19,
1999)
(Amended and Restated July 18,
2001)
(Amended and Restated April 4,
2002)
(Amended and Restated November 25,
2002)
(Amended and Restated January 22,
2003)
(Amended and Restated March 12,
2003)
(Amended and Restated May 5,
2004)
(Amended and Restated March 28,
2006)
(Amended and Restated March 25,
2008)
1. Purposes of the Plan . The
purposes of this Director Stock Option Plan are to attract and
retain the best available personnel for service as Directors of the
Company, to provide additional incentive to the Outside Directors
of the Company to serve as Directors, and to encourage their
continued service on the Board.
All options granted hereunder shall
be “nonstatutory stock options.”
2. Definitions . As used
herein, the following definitions shall apply:
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 DSP Group, Inc., a Delaware corporation.
e. “ Continuous Status as a
Director ” shall mean the absence of any interruption or
termination of service as a Director.
f. “ Director ”
shall mean a member of the Board.
g. “ Effective Date
” shall have the meaning as set forth in Section 6
below.
h. “ Employee ”
shall mean any person, including officers and Directors, employed
by the Company or any Parent or Subsidiary of either company. The
payment of a Director’s fee by the Company or any Parent or
Subsidiary of either company shall not be sufficient in and of
itself to constitute “employment” by the
Company.
i. “ Exchange Act
” shall mean the Securities Exchange Act of 1934, as
amended.
j. “ First Option
” shall have the meaning as set forth in Section 4.b.ii.
below.
k. “ Option ”
shall mean a stock option granted pursuant to the Plan.
l. “ Optioned Stock
” shall mean the Common Stock subject to an
Option.
m. “ Optionee ”
shall mean an Outside Director who receives an Option.
n. “ Outside Director
” shall mean a Director who is not an Employee.
o. “ Parent ”
shall mean a “parent corporation,” whether now or
hereafter existing, as defined in Section 424(e) of the
Code.
p. “ Plan ” shall
mean this 1993 Director Stock Option Plan.
q. “ Share ”
shall mean a share of the Common Stock, as adjusted in accordance
with Section 11 of the Plan.
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r. “ Spin-off
Transaction ” means a distribution by the Company to its
stockholders of all or any portion of the securities of any
Subsidiary of the Company.
s. “ Subsequent Option
” shall have the meaning as set forth in
Section 4.b.iii. below.
t. “ Subsidiary ”
shall mean a “Subsidiary Corporation,” whether now or
hereafter existing, as defined in Section 424(f) of the
Code.
u. “ Affiliate ”
and “ Associate ” shall have the respective
meanings ascribed to such terms in Rule 126-2 promulgated under the
Exchange Act.
v. “ Change in Control
” means a change in ownership or control of the Company
effected through either of the following transactions:
(i) the direct or indirect
acquisition by any person or related group of persons (other than
an acquisition from or by the Company or by a Company-sponsored
employee benefit plan or by a person that directly or indirectly
controls, is controlled by, or is under common control with, the
Company) of beneficial ownership (within the meaning of
Rule 13d-3 of the Exchange Act) of securities possessing more
than fifty percent (50%) of the total combined voting power of
the Company’s outstanding securities pursuant to a tender or
exchange offer made directly to the Company’s stockholders
which a majority of the Continuing Directors who are not Affiliates
or Associates of the offeror do not recommend such stockholders
accept, or
(ii) a change in the composition of
the Board over a period of thirty-six (36) months or less such
that a majority of the Board members (rounded up to the next whole
number) ceases, by reason of one or more contested elections for
Board membership, to be comprised of individuals who are Continuing
Directors.
w. “ Continuing
Directors ” means members of the Board who either
(i) have been Board members continuously for a period of at
least thirty-six (36) months or (ii) have been Board
members for less than thirty-six (36) months and were elected
or nominated for election as Board members by at least a majority
of the Board members described in clause (i) who were still in
office at the time such election or nomination was approved by the
Board.
x. “ Corporate
Transaction ” means any of the following
stockholder-approved transactions to which the Company is a
party:
(i) a merger or consolidation in
which the Company is not the surviving entity, except for a
transaction the principal purpose of which is to change the state
in which the Company is incorporated;
(ii) the sale, transfer or other
disposition of all or substantially all of the assets of the
Company (including the capital stock of the Company’s
subsidiary corporations) in connection with the complete
liquidation or dissolution of the Company; or
(iii) any reverse merger in which
the Company is the surviving entity but in which securities
possessing more than fifty percent (50%) of the total combined
voting power of the Company’s outstanding securities are
transferred to a person or persons different from those who held
such securities immediately prior to such merger.
3. Stock Subject to the Plan
. Subject to the provisions of Section 11 of the Plan, the
maximum aggregate number of Shares which may be optioned and sold
under the Plan is 1,680,875 Shares (the “Pool”) of
Common Stock. The Shares may be authorized, but unissued, or
reacquired Common Stock.
Initially, 175,000 Shares were
reserved for issuance under the Plan. In June 1999, the Plan was
amended and restated to increase the number of Shares reserved for
issuance under the Plan by 100,000 shares for a total reserve of
275,000 Shares. In March 2000, the Company effected a two-for-one
split of the Company’s common stock thereby increasing the
number of Shares reserved for issuance under the Plan to
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550,000 Shares. In June 2002, the Plan was
amended and restated to increase the number of Shares reserved for
issuance under the Plan by 200,000 Shares for a total reserve of
750,000 Shares. As a result of the Company’s distribution of
all (or substantially all) of the shares of capital stock of Ceva,
Inc. in November 2002, the number of shares reserved for issuance
under the Plan was adjusted so that 890,875 Shares are available
for issuance under the Plan. In January 2003, the Plan was again
amended and restated to increase the number of Shares reserved for
issuance under the Plan by 240,000 Shares for a total reserve of
1,130,875 Shares. In March 2006, the Plan was again amended and
restated to increase the number of Shares reserved for issuance
under the Plan by 250,000 Shares for a total reserve of 1,380,875
Shares. In March 2008, the Plan was again amended and restated to
increase the number of Shares reserved for issuance under the Plan
by 300,000 Shares for a total reserve of 1,680,875
Shares.
If an Option should expire or become
unexercisable for any reason without having been exercised in full,
the unpurchased Shares which were subject thereto shall, unless the
Plan shall have been terminated, become available for future grant
under the Plan. If Shares which were acquired upon exercise of an
Option are subsequently repurchased by the Company, such Shares
shall not in any event be returned to the Plan and shall not become
available for future grant under the Plan.
4. Administration of and Grants
of Options under the Plan .
a. Administrator . Except as
otherwise required herein, the Plan shall be administered by the
Board.
b. Procedure for Grants . All
grants of Options hereunder shall be automatic and nondiscretionary
and shall be made strictly in accordance with the following
provisions:
i) No person shall have any
discretion to select which Outside Directors of the Company shall
be granted Options or to determine the number of Shares to be
covered by Options granted to Outside Directors of the
Company.
ii) Each person who is an Outside
Director of the Company on the Effective Date of this Plan shall be
automatically granted an Option to purchase 30,000 Shares (the
“First Option”) on the Effective Date of this Plan, as
determined in accordance with Section 6 hereof. Each Outside
Director who becomes a member of the Board after the Effective Date
but prior to January 21, 2003 shall be automatically granted
an Option to purchase 30,000 Shares (also a “First
Option”) on the date on which such person first becomes an
Outside Director of the Company, whether through election by the
stockholders of the Company or appointment by the Board to fill a
vacancy. Each Outside Director who becomes a member of the Board
after January 21, 2003 shall be automatically granted an
Option to purchase 60,000 Shares (also a “First
Option”) on the date on which such person first becomes an
Outside Director of the Company, whether through election by the
stockholders of the Company or appointment by the Board to fill a
vacancy. Each Outside Director who becomes a member of the Board
after May 5, 2004 shall be shall be automatically granted an
Option to purchase 30,000 Shares (also a “First
Option”) on the date on which such person first becomes an
Outside Director of the Company, whether through election by the
stockholders of the Company or appointment by the Board to fill a
vacancy.
iii) From January 1, 1997
through December 31, 2003, each Outside Director of the
Company shall be automatically granted (i) an Option to
purchase 10,000 Shares (a “Subsequent Option”), on
January 1 of each year, if on such date, he or she shall have
served on the Board for at least six (6) months and
(ii) an Option to purchase 10,000 Shares (a “Committee
Option”), on January 1 of each year, for each committee
of the Board on which he or she shall have served as the
chairperson for at least six (6) months on such date. From
January 1, 2004 to December 31, 2004, each Outside
Director of the Company shall be automatically granted (i) an
Option to purchase 20,000 Shares (also a “Subsequent
Option”), on January 1 of each year, if on such date, he
or she shall have served on the Board for at least six
(6) months and (ii) an Option to purchase 20,000 Shares
(also a “Committee Option”), on January 1 of each
year, for each committee of the Board on which he or she shall have
served as the chairperson for at least six (6) months on such
date. Beginning on January 1, 2005, each Outside Director of
the Company shall be automatically granted (i) an Option to
purchase 15,000 Shares (also a “Subsequent Option”), on
January 1 of each year, if on such date, he or she shall have
served on the Board for at least six (6) months and
(ii) an Option to purchase 15,000 Shares (also a
“Committee Option”), on January 1 of each year,
for each committee of the Board on which he or she shall have
served as the chairperson for at least six (6) months on such
date.
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iv) Notwithstanding the provisions
of subsections ii) and iii) hereof, in the event that a grant would
cause the number of Shares subject to outstanding Options, plus the
number of shares previously purchased upon exercise of Options to
exceed the Pool, then each such automatic grant shall be for that
number of Shares determined by dividing the total number of Shares
remaining available for grant by the number of grants to be made on
the automatic grant date. Any further grants shall then be deferred
until such time, if any, as additional Shares become available for
grant under the Plan through action of the stockholders to increase
the number of Shares which may be issued under the Plan or through
cancellation or expiration of Options previously granted
hereunder.
v) Notwithstanding the provisions of
subsections ii) and iii) hereof, any grant of an Option made before
the Company has obtained stockholder approval of the Plan in
accordance with Section 17 hereof shall have their
exercisability conditioned upon obtaining such stockholder approval
of the Plan in accordance with Section 17 hereof.
vi) The terms of any Option granted
hereunder shall be as follows:
a) The Option shall be exercisable
only while the Outside Director remains a Director of the Company,
except as set forth in Section 9 hereof.
b) The exercise price per Share
shall be 100% of the fair market value (as defined in
Section 8.b. hereunder) per Share on the date of grant of the
Option.
c) The Option shall vest and become
exercisable as to one-third of the Shares subject to the Option on
the first anniversary of the date of grant of the Option, and shall
vest and become exercisable as to one-third of the Shares subject
to the Option at the end of each twelve-month period thereafter,
subject to the provisions set forth in Section 9,
below.
d) The Board may accelerate the
unvested portion of any Option granted under the Plan held by any
Director whose Continuous Status as Director terminates for any
reason pri
