EXHIBIT 10.03
 
PDF SOLUTIONS, INC.
 
2001 STOCK PLAN
 
STOCK OPTION AGREEMENT
 
(FRANCE)
 
The Plan and
Other Agreements
PDF Solutions, Inc., a Delaware corporation (the "Company"), hereby grants an
Option as set forth in this Option Agreement (the "Agreement") to you (the
person to whom this Agreement is delivered). The Company's 2001 Stock Plan (the
"Plan") and the Sub-Plan to the PDF Solutions, Inc. 2001 Stock Plan France (the
"Sub-Plan") are incorporated in, and made part of, this Agreement.  Certain
capitalized terms used in this Agreement are defined in the Plan, as amended by
the Sub-Plan.
 
This Agreement and the Plan (as amended by the Sub-Plan) constitute the entire
understanding between you and the Company regarding this Option.  Any prior
agreements, commitments or negotiations concerning this Option are superseded.
 
Preferential Tax Treatment
This Option is intended to qualify for preferential treatment under French tax
and social security laws.
 
Number of Shares, Grant Date, Exercise Price
 
The number of Shares subject to this Option, the Grant Date and the Exercise
Price is set forth in the online grant summary.
 
Vesting
This Option will vest according to the Vesting Schedule in the online grant
summary.
   
Exercisability
This Option is only exercisable on or after the one (1)-year anniversary of the
Date of Option Grant and before the Option expires and then only with respect to
the vested portion of the Option.
   
Term
Your Option will expire in any event (except in the case of your death) at the
close of business at Company headquarters on the day before the one hundred
fourteenth (114th) monthly anniversary of the Date of Option Grant, as shown on
the cover sheet.  Your Option will expire earlier if your Service terminates for
any reason other than your death, as described below.
 
Mandatory Holding Period
The Shares you may acquire upon exercise of this Option are subject to a
mandatory Holding Period, as follows. The Shares subject to this Option may not
be transferred, assigned or hypothecated in any manner before the four (4)-year
anniversary of the Date of Option Grant (the “Holding Period”), except where
such transfer does not lead to any liability of the Company and the Subsidiary
in terms of social security charges or in the event of a Change In Control, if
the Company decides to waive this Holding Period.  Any shares issued prior to
the expiration of the Holding Period may be delivered with a legend to reflect
the foregoing restrictions.  All Shares subject to this Option which you may own
at the time your Service terminates for any reason other than your death or
Disability shall remain subject to the Holding Period .

 
 
1

--------------------------------------------------------------------------------

 

Termination – General
If your Service terminates for any reason, other than for death, Disability or
Cause, as defined below, then:
 
· The unvested portion of your Option, if any, will expire immediately upon your
termination date.
 
· The vested portion of your Option, if any, will expire at the close of
business at Company headquarters on the 90th day after your termination date;
provided that, if you would be prohibited from exercising or selling the vested
portion of your Option during the 90 days following your termination
date because your Service terminates before the one-year or four-year,
respectively, anniversary of the Date of Option Grant (see Exercisability and
Mandatory Holding Period above), the vested portion of your Option, if any, will
expire on the 90th day after the one-year or four-year, as applicable,
anniversary of the Date of Option Grant.
 
Termination for
Cause
If your Service is terminated for Cause, as determined by the Board in its sole
discretion, then you shall immediately forfeit all rights to your Option and the
Option shall immediately expire.  For purposes of this Agreement, “Cause” shall
mean the termination of your Service due to your commission of any act of fraud,
embezzlement or dishonesty; any unauthorized use or disclosure of confidential
information or trade secrets of the Company (or any Parent, Subsidiary or
Affiliate); or any other intentional misconduct adversely affecting the business
or affairs of the Company (or any Parent, Subsidiary or Affiliate) in a material
manner.  This definition shall not restrict in any way the Company’s or any
Parent’s, Subsidiary’s or Affiliate’s right to discharge you for any other
reason, nor shall this definition be deemed to be inclusive of all the acts or
omissions which constitute “cause” for purposes other than this Agreement.

 
 
2

--------------------------------------------------------------------------------

 
 
Death
If your Service terminates because of your death, then:
 
· The unvested portion of your Option, if any, will expire immediately upon your
death.
 
· The vested portion of your Option, if any, will expire at the close of
business at Company headquarters on the date twelve (12) months after the date
of death, irrespective of the normal term of the Option except that, in no
event, shall the Option continue beyond the close of business at Company
headquarters on the tenth (10th) annual anniversary of the Date of Option
Grant.  Notwithstanding the foregoing, if your estate or heirs would be
prohibited from exercising or selling the vested portion of your Option during
the twelve (12) month period following the date of death because the
date of death occurs before the one-year or four-year, respectively, anniversary
of the Date of Option Grant (see Exercisability and Mandatory Holding
Period above), the vested portion of your Option, if any, will expire on the
date twelve (12) months after the one-year or the four-year, as applicable,
anniversary of the Date of Option Grant.  During this period, your estate or
heirs may exercise and/or sell the vested portion of your Option.
 
Disability
If your Service terminates because of your Disability, then:
 
· The unvested portion of your Option, if any, will expire immediately upon your
termination date.
 
· The vested portion of your Option, if any, will expire at the close of
business at Company headquarters on the date twelve (12) months after your
termination date; provided that, if you would be prohibited from exercising or
selling the vested portion of your Option during the twelve (12) month
period following your termination date because your Service terminates before
the one-year or four-year, respectively, anniversary of the Date of
Option Grant (see Exercisability and Mandatory Holding Period above), the vested
portion of your Option, if any, will expire on the date twelve (12)
months after the one-year or four-year, as applicable, anniversary of the Date
of Option Grant.
 
Leaves of Absence
For purposes of this Option, your Service does not terminate when you go on a
bona fide leave of absence that was approved by the Company in writing, if the
terms of the leave provide for continued Service crediting, or when continued
Service crediting is required by applicable law.  However, your Service will be
treated as terminating ninety (90) days after you went on leave, unless your
right to return to active work is guaranteed by law or by a contract.  Your
Service terminates in any event when the approved leave ends unless you
immediately return to active work.
 
The Company determines which leaves count for this purpose, and when your
Service terminates for all purposes under the Plan.

 
 
3

--------------------------------------------------------------------------------

 
 
Notice of Exercise
When you wish to exercise this Option, you must notify the Company by filing the
proper “Notice of Exercise” form provided by the Company or its designated
broker at the address given on the form.  Your notice must specify how many
Shares you wish to purchase.  Your notice must also specify how your Shares
should be registered (in your name only or in your and your spouse’s names as
community property or as joint tenants with right of survivorship).  The notice
will be effective when it is received by the Company’s designated broker.
 
If someone else wants to exercise this Option after your death, that person must
prove to the Company’s satisfaction that he or she is entitled to do so.
 
Form of Payment
When you submit your notice of exercise, you must include payment of the
Exercise Price for the Shares you are purchasing.  Payment may be made in one
(or a combination) of the following forms:
 
· Cash, your personal check, a cashier’s check or a money order.
 
· Shares which have already been owned by you for more than six (6) months and
which are surrendered to the Company.  The Fair Market Value of the
Shares, determined as of the effective date of the Option exercise, will be
applied to the Exercise Price.
 
 · To the extent a public market for the Shares exists as determined by the
Company, by delivery (on a form prescribed by the Company) of an irrevocable
direction to a securities broker to sell Shares and to deliver all or part of
the sale proceeds to the Company in payment of the aggregate Exercise Price.
 

 
 
4

--------------------------------------------------------------------------------

 
 
Withholding Taxes
You will not be allowed to exercise this Option unless you make acceptable
arrangements to pay any withholding or other taxes that may be due as a result
of the Option exercise or sale of Shares acquired under this Option.
 
Restrictions on Exercise and Resale
By accepting this Agreement, you agree not to exercise this Option or sell any
Shares acquired under this Option at a time when applicable laws, regulations or
Company or underwriter trading policies prohibit exercise, sale or issuance of
Shares.  The Company will not permit you to exercise this Option if the issuance
of Shares at that time would violate any law or regulation.  The Company shall
have the right to designate one or more periods of time, each of which shall not
exceed one hundred eighty (180) days in length, during which this Option shall
not be exercisable if the Company determines (in its sole discretion) that such
limitation on exercise could in any way facilitate a lessening of any
restriction on transfer pursuant to the Securities Act or any state securities
laws with respect to any issuance of securities by the Company, facilitate the
registration or qualification of any securities by the Company under the
Securities Act or any state securities laws, or facilitate the perfection of any
exemption from the registration or qualification requirements of the Securities
Act or any applicable state securities laws for the issuance or transfer of any
securities.  Such limitation on exercise shall not alter the vesting schedule
set forth in this Agreement other than to limit the periods during which this
Option shall be exercisable.
 
If the sale of Shares under the Plan is not registered under the Securities Act,
but an exemption is available which requires an investment or other
representation, you shall represent and agree at the time of exercise that the
Shares being acquired upon exercise of this Option are being acquired for
investment, and not with a view to the sale or distribution thereof, and shall
make such other representations as are deemed necessary or appropriate by the
Company and its counsel.
 
Transfer of Option
Prior to your death, only you may exercise this Option.  You cannot transfer or
assign this Option.  For instance, you may not sell this Option or use it as
security for a loan.  If you attempt to do any of these things, this Option will
immediately become invalid.  You may, however, dispose of this Option in your
will.
 
Regardless of any marital property settlement agreement, the Company is not
obligated to honor a notice of exercise from your spouse, nor is the Company
obligated to recognize your spouse’s interest in your Option in any other way.

 
 
5

--------------------------------------------------------------------------------

 
 
Retention Rights
Your Option or this Agreement does not give you the right to be retained by the
Company (or any Parent or any Subsidiaries or Affiliates) in any capacity.  The
Company (or any Parent and any Subsidiaries or Affiliates) reserves the right to
terminate your Service at any time and for any reason, subject to applicable
laws.  By accepting this Option, upon your termination of Service, you shall be
deemed irrevocably to have waived any claim to future vesting, damages or
specific performance for breach of contract or dismissal, compensation for loss
of office, tort or otherwise with respect to the Plan (as amended by the
Sub-Plan), this Option or any other option that is forfeited and/or is
terminated by its terms or to any future option.
 
Stockholder Rights
You, or your estate or heirs, have no rights as a stockholder of the Company
until a certificate for your Option’s Shares has been issued.  No adjustments
are made for dividends or other rights if the applicable record date occurs
before your stock certificate is issued, except as described in the Plan.
 
Adjustments
In the event of a stock split, a stock dividend or a similar change in the
Company stock, the number of Shares covered by this Option (rounded up to the
nearest whole number) and the exercise price per Share may be adjusted (and
rounded down to the nearest whole number) pursuant to the Plan (as amended by
the Sub-Plan).  Your Option shall be subject to the terms of the agreement of
merger, liquidation or reorganization in the event the Company is subject to
such corporate activity.
 
Legends
All certificates representing the Shares issued upon exercise of this Option
shall, where applicable, have endorsed thereon the following legends:
 
 
“THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED ONLY IN
ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE
STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY
ISSUING THE SHARES REPRESENTED BY THIS CERTIFICATE.”

 
 
6

--------------------------------------------------------------------------------

 
 
Applicable Law
This Agreement will be interpreted and enforced under the laws of the State of
Delaware.
 
French Securities Laws
Note that neither the Plan nor the Sub-Plan entails the issue of an information
memorandum receiving the visa of the Autorité des Marchés Financiers and the
Plan and the Sub-Plan have not been authorized by the Autorité des Marchés
Financiers.  You can only participate in the Plan to your own account in
accordance with the provisions of French Decree no. 2006-557 of May 16, 2006,
such as codified in Articles D.411-1 to D.411-4 of the French Financial and
Monetary Code.  The direct or indirect diffusion to the public in France of the
financial instruments acquired as a result of participation in the Plan is
strictly limited and may only be carried out in accordance with Articles
L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3 of the French Financial and
Monetary Code.
 
Data Protection
Optionee acknowledges that the Company, its Subsidiaries and its Affiliates may
process confidential or sensitive personal data about Optionee. Such data
includes but is not limited to appropriate personal and financial data about
Optionee. Optionee hereby gives explicit consent to the Company to process any
such personal data and/or sensitive personal data. Optionee also hereby gives
explicit consent to the Company to transfer any such personal data and/or
confidential or sensitive personal data outside the country in which Optionee is
employed, as well as to the providers of benefits or administration services to
the Company or employees, and Optionee agrees to the processing, disclosing and
transmitting of such information as is disclosed. The legal person for whom such
personal data is intended is the Company (or any of its Subsidiaries or
Affiliates). Optionee understands that he/she has the right of access and
correction to his/her personal data by making a request to the Company’s
Secretary. Optionee further understands that the Company or a Subsidiary may
report information regarding this Option to any tax authorities and other
governmental agencies as may be required to comply with applicable law.
 

No Entitlements
Optionee's rights, if any, in respect of or in connection with this Option are
derived solely from the discretionary decision of the Company to permit the
Optionee to participate in the Plan (as amended by the Sub-Plan) and to benefit
from a discretionary Option.  By accepting this Option, Optionee expressly
acknowledges that there is no obligation on the part of the Company to continue
the Plan or the Sub-Plan and/or grant any additional options to Optionee.  This
Option is not intended to be compensation of a continuing or recurring nature,
or part of a Optionee's normal or expected compensation, and in no way
represents any portion of Optionee's salary, compensation, or other remuneration
for purposes of pension benefits, severance, redundancy, resignation or any
other purpose.
 

By accepting this Agreement electronically on the website of the Company’s
designated broker, you agree to all of the terms and conditions described above
and in the Plan, as amended by the Sub-Plan.
 

 
7