|
Exhibit
10.3(b)
SAIFUN SEMICONDUCTORS
LTD.
2003 SHARE OPTION
PLAN
SHARE OPTION
AGREEMENT
Unless otherwise defined herein, the
terms defined in the 2003 Share Option Plan, as amended from time
to time (the “ Plan ”) of Saifun Semiconductors
Ltd. shall have the same defined meanings in this Share Option
Agreement (the “ Option Agreement ”). Except
where the context otherwise requires, the term “
Company ” shall include Saifun Semiconductors Ltd. and
its Subsidiaries, if applicable.
| I. |
NOTICE OF OPTION GRANT |
|
|
|
|
|
|
1.
Name :
|
|
__________________________(the “ Optionee
”) |
|
|
|
Address:
|
|
__________________________ |
|
|
|
|
__________________________ |
| 2. |
The undersigned Optionee has been granted an Option to purchase
Ordinary Shares, par value NIS 0.01, of Saifun Semiconductors Ltd.,
subject to the terms and conditions of the Plan, this Option
Agreement and Section 102 of the Israeli Income Tax Ordinance
(New Version), 1961 (the “ Tax Ordinance ”) and
any regulations, rules or orders promulgated thereunder, including
the Income Tax Rules (Tax Relief for Issuance of Shares to
Employees), 2003, all as amended from time to time (collectively,
“ Section 102 ”), as follows: |
|
|
|
|
|
|
Date of Grant
|
|
____________________________ |
|
|
|
Vesting Commencement Date
|
|
____________________________ |
|
|
|
Exercise Price per Share
|
|
____________________________ |
|
|
|
Total Number of Shares Granted
|
|
____________________________ |
|
|
|
Type of Option
|
|
Section
102(b)(2) Option - Capital Route |
|
|
|
Term/Expiration Date
|
|
10
years following the Date of Grant |
This Option shall be
exercisable in number of whole shares, according to the following
vesting schedule: 40% of the Options shall vest upon the second
anniversary of the Date of Grant and an additional 20% of the
Options shall vest upon the third, forth and fifth anniversaries of
the Date of Grant, subject to Optionee’s continuing to be an
employee of the Company on each such dates, so that at the end of
five (5) years from the Date of Grant all the Options hereof
shall be exercisable (fully vested).
| 4. |
Provisions for Termination |
In no event may Optionee
exercise this Option after the Term/Expiration Date as provided
above.
In the event that
Optionee’s engagement with the Company should terminate, the
outstanding vested Options on the date of such termination, shall
be exercisable for (i) three (3) months after such
termination (except in the case of termination by reason of death
or Disability); or (ii) six (6) months after such
termination by reason of Optionee’s death or Disability.
Notwithstanding the foregoing, in the event of Optionee’s
death within three (3) months after the date of termination,
the Optionee’s estate or heirs, as applicable, may exercise
all Options, which are vested and exercisable at the time of
Optionee’s termination of engagement, within six
(6) months after the Optionee’s death, but in no event
after the Expiration Date as provided above.
Notwithstanding the above, in
the event that Optionee’s engagement with the Company should
terminate for Cause, the entire unexercised Option (whether vested
or not) shall ipso facto terminate.
For purposes hereof,
termination of Optionee’s engagement shall be deemed
effective as detailed in Section 10.5 of the Plan.
| 1. |
Preamble . The above notice of option grant (the “
Notice of Option Grant ”) constitutes an integral part
of this Option Agreement. |
| |
2.1. |
Subject to the terms and conditions set forth herein, in the
Plan and in the Notice of Option Grant, the Company hereby issues
to the Trustee (as defined below), for the benefit of the Optionee
named in the Notice of Option Grant, an option qualified as
“Section 102(b)(2) Option” (the “ Option
”) to purchase the number of Shares set forth in the Notice
of Option Grant, at the exercise price per Share set forth in the
Notice of Option Grant (the “ Exercise Price
”). |
| |
2.2. |
The Plan, as approved by the Company for use by the Company, is
intended to qualify as an Employee Option Plan within the meaning
of Section 102. The grant of the Option is made pursuant to:
(a) Section 102 and any tax officer’s approval issued
pursuant thereto; and (b) the Trust Agreement (as defined
below). |
| |
2.3. |
The Option is granted pursuant to the Plan, and the said Option
and this Option Agreement are in all respects governed by the Plan
and subject to all of the terms and provisions whether such terms
and provisions are incorporated in this Option Agreement solely by
reference or are expressly cited herein. Any interpretation of this
Option Agreement will be made in accordance with the Plan. Subject
to Section 16.2 of the Plan, in the event of a conflict
between the terms and conditions of the Plan and the terms of this
Option Agreement, the terms and conditions of the Plan shall
prevail, except and to the extent otherwise expressly provided
herein. Notwithstanding the foregoing, in the event of a conflict
between the terms and conditions of the Plan or of this Option
Agreement and any provision of Section 102, the Trust
Agreement or any applicable law, the latter shall govern and
prevail. |
| 3. |
Issuance to Trustee and Lock-Up Period . |
| |
3.1. |
Issuance to Trustee . The Company appointed a trustee,
in accordance with the provisions of Section 102 (the “
Trustee ”) and has entered into a trust agreement with
the Trustee (the “ Trust Agreement ”). Under the
conditions of Section 102(b)(2), the Option and any Shares to
be issued upon exercise of the Option shall be issued to the
Trustee and held in trust for the benefit of Optionee for a period
of no less than the lesser of (a) 30 months, or
(b) twenty-four (24) months from the end of the tax year
in which the Notice of Option Grant was deposited with the Trustee
(the “ Lock-Up Period ”), provided that options
granted after January 1, 2006 are only subject to being held
in trust for two years. |
| |
3.2. |
Lock-Up Period . In order for the tax benefits of
Section 102(b)(2) to apply, during the Lock-Up Period, neither
the Option nor the Shares to be issued upon exercise of the Option,
as the case may be, may be sold or transferred (other than through
a transfer by will or by operation of law), nor may they be the
subject of an attachment or security interest, and no power of
attorney or transfer deed shall be given in respect thereof prior
to the payment of the tax liability. |
2
In the event that Optionee
elects to exercise his Option during the Lock-Up Period, the
Company shall provide the Trustee with the share certificate in the
name of the Trustee, for the benefit of Optionee, in order that the
Trustee will hold it until no sooner than the end of the Lock-Up
Period.
Notwithstanding the above, in
the event the Optionee shall elect to release the Option and/or the
Shares, as the case may be, prior to the conclusion of the Lock-up
Period, the sanctions under Section 102 shall apply to and
shall be borne solely by the Optionee.
| |
3.3. |
End of Lock-Up Period . Upon the conclusion of the
Lock-Up Period and subject to any further period included in the
Plan and/or herein, the Trustee may release the Option and/or the
Shares issued upon exercise of such Option to Optionee only after
(i) the receipt by the Trustee of an acknowledgment from the
income tax authority that Optionee has paid any applicable tax due
pursuant to Section 102 and the Tax Ordinance, or
(ii) the Trustee withholds any applicable tax due pursuant to
Section 102 and the Tax Ordinance. |
| |
3.4. |
Additional Rights . In the event of a distribution of
rights, including an issuance of bonus shares, in connection with
the Option and/or Shares issued upon exercise of such Option (the
“ Additional Rights ”), all such Additional
Rights shall be deposited with and/or issued to the Trustee for the
benefit of the Optionee, and shall be held by the Trustee and
treated in accordance with the provisions of Section 102 and
the capital gain tax route. |
| 4. |
Non-Transferability of Option . This 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 Optionee
only by Optionee. The terms of the Plan and this Option Agreement
shall be binding upon the executors, administrators, heirs,
successors and assigns of Optionee. |
| 5. |
Term of Option . This Option may be exercised only
within the term set out in the Notice of Option Grant, and may be
exercised during such term only in accordance with the Plan, the
terms of this Option Agreement and the Trust Agreement. In the
event the Option shall not be exercised within its term, such
Option, or such part thereof, shall expire and all interests and
rights of the Optionee in and to the same shall
terminate. |
| |
6.1. |
Right to Exercise . This Option shall be exercisable
during its term to the extent vested in accordance with the vesting
schedule set out in the Notice of Option Grant and with the
applicable provisions of the Plan, this Option Agreement and the
Trust Agreement. |
| |
6.2. |
Continuous Engagement Required . Except as otherwise
provided in the Notice of Option Grant, this Option may not be
exercised unless the Optionee, at the time he exercises this Option
is, and has been at all times since the date of grant set out in
the Notice of Option Grant engaged by the Company. Transfer between
locations of the Company or between the Company, its Subsidiaries
or its successor shall not be considered termination of engagement.
In case of an approved leave of absence, the vesting of the Option
shall be suspended during such leave of absence. |
| |
6.3. |
Method of
Exercise . This Option shall be exercised by delivery of a
signed notice of exercise substantially in the form attached hereto
as Exhibit A (the “ Notice of Exercise
”), which shall state the election to exercise the Option,
the number of Shares with respect to which the Option is being
exercised, and shall be accompanied with such other representations
and agreements, as may be required by
|
3
the Company and/or the
Trustee. This Option shall be deemed to be exercised upon receipt
by the Company of such fully executed Notice of Exercise and
settlement of payment of the aggregate Exercise Price in such form
satisfactory to the Company. The Optionee may purchase less than
the number of Shares covered by the vested portion of the Option,
provided that no partial exercise of this Option may be for a
fraction of a Share.
| |
6.4. |
Method of Payment; Cashless Exercise . Payment of the
aggregate Exercise Price for the purchased Shares shall be made by
Optionee’s relinquishment of a portion of his Option having a
Fair Market Value equal to the aggregate Exercise Price, so that
the Company shall issue to the Optionee only the amount of Shares
of the Company having an aggregate Fair Market Value equal to the
difference between (x) the aggregate Fair Market Value of the
Shares so purchased; and (y) the aggregate Exercise Price
applicable for such exercised Options (the “ Cashless
Exercise ”). For the purpose of the Cashless Exercise
hereof, the Committee shall determine the Fair Market Value of the
Shares in accordance with the provisions of the Plan. |
| |
6.5. |
Notification to Trustee . The Company will notify the
Trustee of any exercise of the Option as set forth in the Notice of
Exercise. If such notification is delivered during the Lock-Up
Period, the Shares issued upon the exercise of the Option shall be
issued directly to the Trustee on behalf of the Optionee, and shall
be held by the Trustee in trust on behalf of the Optionee, unless
the Optionee elects to receive the Shares directly to his
possession, pursuant to which the sanctions under Section 102
shall apply and shall be borne solely by the Optionee. In the event
such notification is delivered after the Lock-Up Period, the Shares
issued upon the exercise of the Option shall be transferred either
to the Trustee or to Optionee directly, at the election |
|
