EXHIBITS 10.53
DSP TECHNOLOGY INC.
1991 STOCK OPTION PLAN
(As Amended By the Board Through February 21, 1997)
1. Name, Effective Date and Purpose.
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(a) This document is intended to implement and govern the 1991 Stock
Option Plan (the "Plan") of DSP TECHNOLOGY INC., a California corporation (the
"Company"). The Plan provides for the granting of options that are intended to
qualify as incentive stock options ("Incentive Stock Options") within the
meaning of section 422(b) of the Internal Revenue Code of 1986, as amended (the
"Code") and for the granting of options that are not intended to so qualify
("nonqualified stock options").
(b) The Plan is established effective as of April 23, 1991. The
purpose of the Plan is to promote the growth and general prosperity of the
Company. The Plan will permit the Company to grant options ("Options") to
purchase shares of its common stock ("Common Stock"). The granting of Options
will help the Company attract and retain the best available persons for
positions of substantial responsibility and will provide certain key employees
with an additional incentive to contribute to the success of the Company and its
Affiliated Companies. For purposes of the Plan, the term "Affiliated Companies"
shall mean any component member of a controlled group of corporations, as
defined under section 1563 of the Code, in which the Company is also a component
member, any Parent Corporation of the Company and any Subsidiary Corporation of
the Company.
2. Administration.
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(a) The Plan shall be administered by the Board of Directors of the
Company (the "Board") and/or by a duly appointed committee of the Board as
specified in Subsection 2(c) below. Any subsequent references in the Plan 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 amend or terminate the Plan at any time,
subject to the terms of the Plan and any applicable limitations imposed by law.
(b) The Board shall have sole authority, in its absolute discretion,
to determine which of the eligible persons of the Company and its Affiliated
Companies shall receive Options ("Optionees"), and, subject to the express
provisions and restrictions of the Plan, shall have sole authority, in its
absolute discretion, to determine the time when Options shall be granted, the
terms and conditions of an Option other than those terms and conditions fixed
under the Plan, the number of shares of Common Stock which may be issued upon
exercise of an Option and the means of payment for such shares, and shall have
authority to do everything necessary or appropriate to administer the Plan,
including but not limited to (i) setting different terms and conditions for
different Options and (ii) interpreting the Plan. All decisions, determinations
and interpretations of the Board shall be final and binding on all Optionees.
(c) The Board shall have the authority to delegate some or all of the
powers granted to it pursuant to this Section 2 to a committee (the "Committee")
appointed by the Board and consisting of not less than two (2) members of the
Board. The Board may from time to time remove members from, or add members to,
the Committee, and vacancies on the Committee shall be filled by the Board. All
decisions, determinations and interpretations of the Committee shall be final
and binding on all Optionees.
(d) Definitions.
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(i) Restricted Shareholder: An individual who, at the time
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an Option is granted under the Plan, owns stock possessing more than ten percent
(10%) of the total combined voting power or value of all classes of stock of the
employer corporation or of its Parent Corporation or Subsidiary Corporation,
with stock ownership to be determined in light of the attribution rules set
forth in section 424(d) of the Code.
(ii) Parent Corporation: A corporation as defined in
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Section 424(e) of the Code.
(iii) Subsidiary Corporation: A corporation as defined in
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Section 424(f) of the Code.
(iv) Officer: The president, principal financial officer,
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principal accounting officer (or, if there is no such accounting officer, the
controller), any vice president of the Company in charge of a principal business
unit, division, or function (such as sales, administration, or finance), any
other officer who performs a policy-making function, or any other person who
performs similar policy-making functions for the Company.
3. Eligibility. The Board may, in its discretion, grant one (1) or more
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Options under the Plan to any employee (including officers and any director who
is an employee) of the Company or any of its Affiliated Companies presently
existing or hereinafter organized or acquired. Such options may be granted to
one (1) or more such employees without being granted to other eligible
employees, as the Board may deem fit.
4. Stock to be Optioned. Options shall be for the purchase of shares of
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Common Stock, subject to adjustment as provided in Section 20 below. Shares of
Common Stock delivered upon the exercise of Options may be either previously
unissued shares or outstanding shares. Subject to the limitations described in
this Section 4 and adjustment as provided in Section 20, the maximum number of
shares of Common Stock which may be issued under the Plan shall be one million
eighteen thousand three hundred twenty-seven (1,018,327) shares (the "Maximum
Shares"). The Company has a 1985 Incentive Stock Option Plan and 1985
Nonstatutory Stock Option Plan (the "1985 Plans") under which, as of April 23,
1991, (a) the Company had granted and there remained outstanding options to
purchase one hundred seventy-four thousand four hundred thirty-three (174,433)
shares of Common Stock (the "1985 Plan Options"), and (b) there remained one
hundred three thousand eight hundred ninety-four (103,894) shares of Common
Stock available for future grants (the "1985 Plan Available Shares"). Except as
provided below, the Maximum Shares shall be deemed to include the number of
shares subject to the 1985 Plan Options and the 1985 Plan Available Shares. The
aggregate maximum number of shares of Common Stock which may be issued upon the
exercise of Options, determined at any time, shall be equal to the Maximum
Shares reduced by (a) the number of shares remaining subject to outstanding 1985
Plan Options, (b) the number of shares issued upon the exercise of 1985 Plan
Options, and (c) the portion, if any, of the 1985 Plan Available Shares which
are issued upon the exercise of options granted under the 1985 Plans subsequent
to April 23, 1991. In the event that any outstanding option granted under the
Plan for any reason expires or is terminated or canceled or shares of Common
Stock subject to repurchase under the Plan 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 under the Plan.
5. Option Exercise Price. The Option Exercise Price for shares of Common
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Stock to be issued under the Plan shall be not less than the fair market value
of such shares on the date on which the Option covering such shares is granted
by the Board, except that if on the date on which such Option is granted the
Optionee is a Restricted Shareholder, then such Option Exercise Price shall not
be less than one hundred ten percent (110%) of the fair market value of the
shares of Common Stock subject to the Option on the date on which such Option is
granted by the Board. The fair market value of the shares of Common Stock for
all purposes of the Plan is to be determined by the Board in its sole
discretion, exercised in good faith.
6. Term of Plan. The Plan shall become effective on April 23, 1991 and
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shall continue in effect until April 22, 2001, unless terminated earlier by
action of the Board. No Option may be granted hereunder after April 22, 2001.
7. Exercise of Options. Subject to the actions, conditions and/or
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limitations set forth in the Plan and/or any applicable Stock Option Agreement
entered into hereunder, Options granted under the Plan shall be exercisable in
accordance with the following rules:
(a) Options granted under the Plan shall first become exercisable in
whole or in part at such time as the Board shall determine; provided, however,
that no Option granted under the Plan may be exercised in whole or in part until
six (6) months after the date on which the Option is granted by the Board
(hereinafter the "Option Grant Date").
(b) Subject to the specific provisions of this Section 7, Options
shall become exercisable at such times and in such installments (which may be
cumulative) as the Board shall provide in the terms of each individual Option;
provided, however, that by a resolution adopted after an Option is granted the
Board may, on such terms and conditions as it may determine to be appropriate
and subject to the specific provisions of this Section 7, accelerate the time at
which such Option or installment thereof may be exercised. For purposes of the
Plan, any accrued installment of an Option granted hereunder shall be referred
to as an "Accrued Installment."
(c) An Option may be exercised when Accrued Installments accrue as
provided in the terms under which such Option was granted and at any time
thereafter within such period from the Option Grant Date as the Board shall
provide in the terms of each individual Option, subject, however, to the
restrictions contained in this Section 7. Except as provided in the following
sentence, in no event shall any Option be exercised on or after the tenth (10th)
anniversary of the Option Grant Date of such Option, regardless of the
circumstances then existing (including, but not limited to, the death or
termination of employment of the Optionee). If on the date on which any Option
is granted the Optionee is a Restricted Shareholder, then in no event shall such
Option be exercised on or after the fifth (5th) anniversary of the Option Grant
Date of such Option, regardless of the circumstances then existing (including,
but not limited to, the death or termination of employment of the Optionee).
The date upon which the term of an Option as set by the Board shall expire shall
be hereinafter designated as the "Option Term Date."
(d) A "Transfer of Control" shall be deemed to have occurred in the
event any of the following occurs with respect to the Company.
(i) 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) a merger in which the Company is not the surviving
corporation, other than a merger the principal purpose of which is to change the
state of the Company's incorporation;
(iii) a merger in which the Company is the surviving
corporation where the shareholders of the Company before such merger do not
retain, directly or indirectly, at least a majority of the beneficial interest
in the voting stock of the Company after such merger;
(iv) the sale, exchange, or transfer of all or substantially
all of the Company's assets (other than a sale, exchange, or transfer to one (1)
or more subsidiary corporations of the Company); or
(v) a liquidation or dissolution of the Company.
Notwithstanding the foregoing provisions of this Section 7, in the event of
a Transfer of Control, the surviving, continuing, successor, or purchasing
corporation or parent corporation thereof, as the case may be (the "Acquiring
Corporation") shall either assume the Company's rights and obligations under
outstanding stock option agreements or substitute options for the Acquiring
Corporation's stock for such outstanding Options. In the event the Acquiring
Corporation elects not to assume or substitute for such outstanding Options in
connection with a merger described in clauses (ii) or (iii) above, the Board
shall provide that any 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 so determines; provided, however, that in no
event shall Optionee's have less than a thirty (30) day period during which to
exercise their Options. Notwithstanding the foregoing, in the event that the
transaction constituting the Transfer of Control is not consummated, any
unexercised unaccrued installments that had become exercisable and/or vested
solely by reason of the provisions of this subsection 7(d) shall again become
unaccrued and unexercisable as of the termination of such proposed transaction,
subject, however, to such installments accruing pursuant to the normal accrual
schedule provided in the terms under which such Option was granted. Any
exercise of an installment prior to termination of such proposed transaction
shall remain effective notwithstanding that such installment became exercisable
solely by reason of the Company undertaking the transaction constituting 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 effective as of the date of the Transfer of Control.
(e) Subject to the provisions of Subsection 7(f) below involving the
death or disability of an Optionee while an employee of the Company, as of the
effective date of the termination of employment of an Optionee with the Company
or an Affiliated Company for any reason other than death or disability (the
"Termination Date"), any unexercised Accrued Installments of the Option granted
hereunder to such terminated Optionee shall expire and become unexercisable as
of the earlier of (i) the applicable Option Term Date, or (ii) ninety (90) days
following such Termination Date; provided, however, that the Board may extend
such ninety (90) day period in the case of a nonqualified stock option to a
period not to exceed one (1) year following the Termination Date, but in no
event beyond the applicable Option Term Date. Any installments of an Option
which have not accrued as of the Optionee's Termination Date shall expire and
become unexercisable as of such Termination Date even if the reason for the
Optionee's termination is death or disability. Any portion of an Option that
expires hereunder shall remain unexercisable and be of no effect whatsoever
after such expiration notwithstanding that such Optionee may be reemployed by
the Company or an Affiliated Company.
(f) Notwithstanding the foregoing provisions of this Section 7, in the
event of the death of an Optionee while an employee of the Company or an
Affiliated Company, or in the event of the termination of employment by reason
of the Optionee's disability, any unexercised Accrued Installments of the Option
granted hereunder to such Optionee shall expire and become unexercisable as of
the earlier of (i) the applicable Option Term Date, or (ii) the first
anniversary of the date of death of such Optionee (if applicable), or (iii) the
first anniversary of the date of the termination of employment by reason of
disability (if applicable). Any such Accrued Installments of a deceased
Optionee may be exercised prior to their expiration by (and only by) the person
or persons to whom the Optionee's Option rights shall pass by will or by the
laws of descent and distribution, if applicable, subject, however, to all of the
terms and conditions of the Plan and the applicable Stock Option Agreement
governing the exercise of Options granted hereunder. For purposes of this
Subsection 7(f), an Optionee shall be deemed employed by the Company or an
Affiliated Company during any period of leave of absence from active employment
as authorized by the Company or an Affiliated Company, as the case may be.
(g) An Option shall be deemed exercised when written notice of such
exercise has been given to the Company at its principal business office by the
person entitled to exercise the Option and full payment in cash or cash
equivalent (or with shares of Common Stock pursuant to Section 9 below or by the
assignment of the proceeds of a sale of some or all of the shares of Common
Stock being acquired upon the exercise of the Option pursuant to Section 10
below) for the shares of Common Stock with respect to which the Option is
exercised has been received by the Company. Until the issuance of the
certificate or certificates for the shares of Common Stock, no right to vote or
receive dividends or any other rights as a shareholder shall exist with respect
to optioned shares notwithstanding the exercise of the Option. No adjustment
shall be made for a dividend or other rights for which the record date is prior
to the date the certificate or certificates are issued except as provided in
Section 20 below.
(h) An Option may be exercised in accordance with this Section 7 as to
all or any portion of the shares of Common Stock covered by any Accrued
Installment of the Option from time to time during the applicable option period,
but shall not be exercisable with respect to fractions of a share.
(i) As soon as practicable after any proper exercise of an Option in
accordance with the provisions of the Plan, the Company shall, without charging
transfer or issue tax to the Optionee, deliver to the Optionee at its principal
business office, or such other place as shall be mutually acceptable, a
certificate or certificates representing the shares of Common Stock as to which
the Option has been exercised. The time of issuance and delivery of the shares
of Common Stock may be postponed by the Company for such period as may be
required for its with reasonable diligence to comply with any applicable listing
requirements of any national or regional securities exchange and any law or
regulation applicable to the issuance and delivery of such shares.
8. Authorized to Grant Options and Shareholder Approval. Options granted
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under the Plan shall be conditioned upon the Company obtaining any required
permit from the Department of Corporations of the State of California and/or
other appropriate governmental agencies, free of any conditions not acceptable
to the Board, authorizing the Company to grant such Options; provided, however,
that such condition shall lapse as of the effective date of issuance of such
permit(s) in a form to which the Company does not object within sixty (60) days.
The grant of Options under the Plan also is conditioned on approval of the Plan
by the shareholders of the
Company; and no Option granted hereunder shall be effective or exercisable
unless and until the Plan has been so approved.
9. Payment of Option Exercise Price with Company Stock. The Board may
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provide that, upon exercise of an Option, the Optionee may elect to pay for some
or all of the shares of Common Stock underlying the Option with shares of Common
Stock of the Company previously acquired and owned at the time of exercise by
the Optionee, provided that the Optionee will make representations and
warranties satisfactory to the Company regarding his or her title to the shares
used to effect the purchase, including, without limitation, representations and
warranties that the Optionee has good and marketable title to such shares free
and clear of any and all liens, encumbrances, charges, equities, claims,
security interests, options, or restrictions and has full power to deliver such
shares without obtaining the consent or approval of any person or governmental
authority other than those which have already given consent or approval in a
form satisfactory to the Company. The equivalent dollar value of the shares of
Common Stock used to effect the purchase shall be the fair market value of the
shares on the date of the exercise as determined by the Board in its sole
discretion, exercised in good faith.
10. Payment of Option Exercise Price with Same-Day-Sale Proceeds. The
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Board may provide that the Optionee may pay for some or all of the shares of
Common Stock underlying the Option by the assignment of the proceeds of a sale
of some or all of the shares of Common Stock being acquired upon the exercise of
the 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). 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 procedures for the
exercise of Options by means of an assignment of the proceeds of a sale of some
or all of the shares of Common Stock to be acquired upon such exercise.
11. Stock Option Agreement. The terms and conditions of Options granted
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under the Plan shall be evidenced by a Stock Option Agreement (hereinafter
referred to as the "Agreement") executed by the Company and the person to whom
the Option is granted. Each Agreement shall contain the following provisions:
(a) A provision fixing the number of shares of Common Stock which may
be issued upon exercise of the Option;
(b) A provision establishing the Option Exercise Price per share;
(c) A provision establishing the times and the installments in which
Options may be exercised;
(d) A provision incorporating therein the Plan by reference;
(e) A provision clarifying which Options are intended to be Incentive
Stock Options and which are intended to be nonqualified stock options;
(f) A provision fixing the maximum duration of the Option as set by
the Board; provided, however, that such period shall not be more than ten (10)
years from the Option Grant Date;
(g) Such representations and warranties by the Optionee as may be
required by Section 21 below or as may be required by the Board in its sole
discretion;
(h) Any other restrictions (in addition to those established under the
Plan) as may be established by the Board with respect to the exercise of the
Option, the transfer of the Option, and/or the transfer of the shares of Common
Stock purchased by exercise of the Option, provided that such restrictions are
not in conflict with the Plan; and
(i) Such other terms and conditions not inconsistent with the Plan as
may be established by the Board.
12. Taxes, Fees and Expenses. The Company shall pay all original issue
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and transfer taxes (but not income taxes, if any) with respect to the grant of
Options and/or the issue and transfer of shares of Common
Stock pursuant to the exercise of such Options, and all other fees and expenses
necessarily incurred by the Company in connection therewith, and will from time
to time use its best efforts to comply with all laws and regulations which, in
the opinion of legal counsel for the Company, shall be applicable thereto.
13. Withholding of Taxes. The grant of Options hereunder and the issuance
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of shares of Common Stock pursuant to the exercise of such Options is
conditioned upon the Company's reservation of the right to withhold, in
accordance with any applicable law, from any compensation payable to the
Optionee any taxes required to be withheld by federal, state, or local law as a
result of the grant or exercise of any such Option.
14. Amendment or Termination of the Plan.
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(a) The Board may amend the Plan from time to time in such respects as
the Board may deem advisable; provided, however, that no such amendment shall
operate to (i) affect adversely an Optionee's right under the Plan with respect
to any Option granted hereunder prior to the adoption of such amendment, except
as may be necessary, in the judgment of legal counsel for the Company, to comply
with any applicable law or regulation, or (ii) increase the maximum aggregate
number of shares of Common Stock which may be optioned and sold under the Plan
or change the class of persons eligible to receive Options under the Plan unless
such increase or change has been approved by the shareholders of the Company.
(b) The Board may at any time terminate the Plan. Any such
termination of the Plan shall not, without the written consent of the Optionee,
alter the terms of Options already granted and such Options shall remain in full
force and effect as if the Plan had not been terminated.
15. Options Not Transferable. Options granted under the Plan may not be
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sold, pledged, hypothecated, assigned, encumbered, gifted, or otherwise
transferred or alienated in any manner, either voluntarily or involuntarily by
operation of law, other than by will or by the laws of descent or distribution,
and may be exercised during the lifetime of an Optionee only by such Optionee.
16. Restrictions on Transfer of Stock. Shares of Common Stock issued
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pursuant to the exercise of an Option granted under the Plan (hereinafter, the
"Optioned Stock"), or any interest in such Optioned Stock, may be sold, pledged,
hypothecated, assigned, encumbered, gifted, or otherwise transferred or
alienated in any manner by the holder(s) thereof. However, the Board, in its
absolute discretion, may impose such restrictions on the transferability of the
Optioned Stock as it deems appropriate and any such restriction shall be set
forth in the respective Stock Option Agreement and may be referred to on the
certificate or certificates evidencing such shares. The Board may require the
Optionee to give the Company prompt notice of any disposition of shares of
Optioned Stock acquired by exercise of an Incentive Stock Option within two (2)
years from the date of granting such Option or one (1) year after the transfer
of such shares to such Optionee. The Board may direct that the certificate or
certificates evidencing shares of Optioned Stock refer to such requirement to
give prompt notice of such disposition. All transfers of Optioned Stock shall
also be subject to any representations or warranties required under Section 21
below and also subject to compliance with any applicable federal, state, or
other local law, regulation, or rule governing the sale or transfer of stock or
securities.
17. Reservation of Shares of Common Stock. The Company, during the term
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of the Plan, shall at all times keep available such number of shares of its
Common Stock as shall be sufficient to satisfy the requirements of the Plan.
18. Restrictions on Issuance of Shares. The Company, during the term of
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the Plan, will use its best efforts to seek to obtain from the appropriate
regulatory agencies any requisite authorization in order to issue and sell such
number of shares of its Common Stock as shall be sufficient to satisfy the
requirements of the Plan. The inability of the Company to obtain from any such
regulatory agency having jurisdiction thereof the authorization deemed by legal
counsel for the Company to be necessary to the lawful issuance and sale of any
shares of its Common Stock hereunder or the inability of the Company to confirm
to its satisfaction that any issuance and sale of any such shares will meet
applicable legal requirements shall relieve the Company of any liability in
respect of the non-issuance or sale of such shares as to which such
authorization or confirmation has not been obtained.
19. Notices. Any notice to be given to the Company pursuant to the
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provisions of the Plan shall be addressed to the Company in care of its
Secretary at its principal business office, and any notice to be given to a
person to whom an Option is granted hereunder shall be addressed to him or her
at the address given beneath his or her signature on his or her Stock Option
Agreement, or at such other address as such person or his or her transferee
(upon the transfer of Optioned Stock) may hereafter designate in writing to the
Company. Any such notice shall be deemed duly given when enclosed in a properly
sealed envelope or wrapper addressed as aforesaid, registered or certified, and
deposited, postage and registry or certification fee prepaid, in a post office
or branch post office regularly maintained by the United States Postal Service.
It shall be the obligation of each Optionee and each transferee holding Optioned
Stock to provide the Secretary of the Company, by letter mailed as provided
hereinabove, with written notice of his or her correct mailing address.
20. Adjustments Upon Changes in Capitalization. If the outstanding shares
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of Common Stock of the Company are increased, decreased, changed into, or
exchanged for a different number or kind of shares of the Company through
reorganization, recapitalization, reclassification, stock dividend, stock split,
or reverse stock split, then upon proper authorization of the Board an
appropriate and proportionate adjustment shall be made in the number or kind of
shares which may be issued upon exercise of Options granted under the Plan as
determined under Section 4, in the number and kind of shares subject to
outstanding Options, and in the Option Exercise Price of outstanding Options;
provided, however, that no such adjustments need be made if, upon the advice of
legal counsel, the Board determines that such adjustments may result in the
receipt of federally taxable income to holders of Options granted hereunder or
the holders of Common Stock or other classes of the Company's securities.
21. Representations and Warranties. As a condition to the exercise of any
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portion of an Option, the Company may require the person exercising such Option
to make any representation and/or warranty to the Company as may, in the
judgment of legal counsel for the Company, be required under any applicable law
or regulation, including, but not limited to, a representation and warranty that
the shares are being acquired only for investment and without any present
intention to sell or distribute such shares if, in the opinion of legal counsel
for the Company, such a representation is required under the Securities Act of
1933, as amended, or any other applicable law, regulation, or rule of any
governmental agency.
22. No Enlargement of Employee Rights. The Plan is purely voluntary on
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the part of the Company, and while the Company hopes to continue it
indefinitely, the continuance of the Plan shall not be deemed to constitute a
contract between the Company and any employee, or to be consideration for or a
condition of the employment of any employee. Nothing contained in the Plan
shall be deemed to give any employee the right to be retained in the employ of
the Company or its Affiliated Companies, or to interfere with the right of the
Company or an Affiliated Company to discharge or retire any employee thereof at
any time for any reason, with or without cause. No employee shall have any
right to or interest in Options authorized hereunder prior to the grant of such
an Option to such employee, and upon such grant he or she shall have only such
rights and interests as are expressly provided herein, subject, however, to all
applicable provisions of the Articles of Incorporation of the Company, as the
same may be amended from time to time.
23. Legends on Certificates. Each certificate representing shares of
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Common Stock issued under the Plan shall bear whatever legends are required by
federal or state law or by any governmental agency. In particular, unless an
appropriate registration statement is filed pursuant to the Securities Act of
1933, as amended, with respect to the shares of Common Stock issuable under the
Plan, each certificate representing such shares of Common Stock shall be
endorsed on its face with the following legend or its equivalent:
"Neither the Option pursuant to which the shares represented by this
certificate are issued nor said shares have been registered under the
Securities Act of 1933, as amended (the "Act"). Transfer or sale of such
securities or any interest therein is unlawful except after registration,
or pursuant to an exemption from the registration requirements, as provided
in the Act and the regulations thereunder."
A copy of the Plan shall be delivered to the Secretary of the Company
and shall be shown by him or her to any eligible person making reasonable
inquiry concerning it.
24. Specific Performance. The Options granted under the Plan cannot be
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readily purchased or sold in the open market, and, for that reason among others,
the Company and its shareholders will be irreparably damaged in the event that
the Plan is not specifically enforced. Should any dispute arise concerning the
sale or
other disposition of an Option, an injunction may be issued restraining such
sale or other disposition of such Option pending the determination of such
controversy. In the event of any controversy concerning the right or obligation
to purchase or sell any such Option, such right or obligation shall be
enforceable in a court of equity by a decree of specific performance. Such
remedy shall, however, be cumulative and not exclusive, and shall be in addition
to any other remedy which the parties may have.
25. Invalid Provisions. In the event that any provision of the Plan is
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found to be invalid or otherwise unenforceable under any applicable law, such
invalidity or unenforceability shall not be construed as rendering any other
provisions contained herein invalid or unenforceable, and all such other
provisions shall be given full force and effect to the same extent as though the
invalid or unenforceable provision was not contained herein.
26. Applicable Law. The Plan shall be governed by and construed in
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accordance with the laws of the State of California.
27. Reports to Optionees. The Company, during the term of the Plan, will
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distribute to all Optionees a copy of its annual financial statements in
accordance with the requirements of applicable state law.
28. Successors and Assigns. The Plan shall be binding on and inure to the
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benefit of the Company or its successors and the employees to whom an Option is
granted hereunder, and such employees' heirs, executors, administrators,
legatees, personal representatives, assignees and transferees.
29. Mergers and Acquisitions.
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(a) If the Company at any time should succeed to the business of
another corporation through a merger or consolidation, or through the
acquisition of assets or stock of such corporation, Options may be granted under
the Plan to option holders of such corporation or its subsidiaries, in
substitution for options or rights to purchase stock of such corporation held by
them at the time of succession. The Board shall have sole and absolute
discretion to determine the extent to which such substitute Options shall be
granted (if at all), the person or persons to receive such substitute Options
(who need not be all option holders of such corporation), the number of Options
to be received by each such person, the Option Exercise Price of such Option,
and the terms and conditions of such substitute Options; provided, however, that
the terms and conditions of the substitute Options shall comply with the
provisions of section 424(a) of the Code, such that the excess of the aggregate
fair market value of the shares subject to such substitute Option immediately
after the substitution or assumption over the aggregate option exercise price of
such shares is not more than the excess of the aggregate fair market value of
all shares subject to the substitute Option immediately before such substitution
or assumption over the aggregate option exercise price of such shares, and the
substitute Option or the assumption of the old option does not give the holder
thereof additional benefits which he or she did not have under such old option.
(b) Notwithstanding anything to the contrary herein, no Option shall
be granted, nor any action taken, permitted, or omitted, which would cause the
Plan, or any Options granted hereunder as to which Rule 16b-3 under the
Securities Exchange Act of 1934, as amended, may apply, not to comply with such
rule.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies that
the foregoing DSP Technology Inc. 1991 Stock Option Plan was duly adopted by the
Board of Directors on the April 23, 1991 and subsequently amended on April 1,
1993, February 24, 1994, April 14, 1995, February 22, 1996 and February 21,
1997.
DSP TECHNOLOGY INC.
By: /s/ Jose M. Millares
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Jose M. Millares, Jr., Secretary