Exhibit 10.6

 

National Semiconductor Corporation

Notice of Grant of Stock Option and Option Agreement

 

You have been granted a Non-Qualified Stock Option under one of National
Semiconductor Corporation's Stock Option Plans.

 

Option Grant Date:

 

Option Price:

 

Number of Shares:

 

Vesting Schedule:

 

Plan under which option granted:

 

Option Term:

 

Option Number:

 

Except in certain instances, vesting on options ceases upon termination of
employment. After termination, vested options generally may be exercised within
3 months although certain exceptions apply. Consult the Plan and Prospectus for
details.

 

The option is subject to the terms and conditions of this non-qualified Stock
Option Agreement, the additional terms and conditions of the Stock Option
Agreement, the Plan under which the option was granted, and the Prospectus for
the Company's Stock Option Plans. These documents may be accessed on the
intranet at the National Semiconductor Corporate Human Resources website,
www-hr.nsc.com/Site_Map/site_map.html. Hard copies are available upon request
from Stock Administration, Mail Stop C1-640, 2900 Semiconductor Drive, Santa
Clara, CA 95051, stock.administration@nsc.com.

 

The exercise of a stock option has tax implications. Consult the Prospectus and
your tax adviser for details.

 

PLEASE NOTE: The granting of stock options is solely at the Company's
discretion. There is no guarantee that you will be granted options in the
future. In addition, the Company is not responsible for and does not guarantee
that you will be able to achieve any particular sales price in connection with
your stock option exercise.

 

By agreeing to accept this agreement, you confirm that you have received copies
of and agree to be bound by the terms and conditions of the applicable Stock
Option Plan, Additional Terms of the Stock Option Agreement, and Prospectus. In
particular, you should note that by accepting this agreement, you consent to the
collection, use and transfer of personal data about you as described in the
Additional Terms of the Stock Option Agreement. This option cannot be exercised
unless you have accepted this agreement.

 

*97PL is the 1997 Employees Stock Option Plan, 77PL is the Stock Option Plan,
and EXEC is the Executive Officer Stock Option Plan.

 

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AGREEMENT

ADDITIONAL TERMS AND CONDITIONS

STOCK OPTION PLAN

1997 EMPLOYEES STOCK OPTION PLAN

EXECUTIVE OFFICER STOCK OPTION PLAN

 

Rev. 2/26/07

 

1.      The Option shall terminate and may not be exercised if the Optionee
ceases to be employed by the Company, or any of its subsidiaries, prior to
Optionee's completion of six months of continuous employment following the date
the Option was granted. If Optionee's employment terminates after such six month
period, the Option shall terminate and may not be exercised except as follows:

 

 

(a)

If Optionee's continuous employment terminates for any reason other than (i)
retirement, (ii) permanent disability, or (iii) death, Optionee may exercise the
Option to the extent that Optionee was entitled to exercise it at the date of
such termination at any time within a period of three (3) months following the
date of such termination. If Optionee shall die during such three (3) month
period without having exercised the Option, the person or persons to whom the
Optionee's rights under the Option shall pass by will or by the laws of descent
or distribution may exercise the Option within a period of one year following
Optionee's death but only to the extent the Option was exercisable at the date
of Optionee's termination;

 

(b)

If Optionee's continuous employment is terminated by (i) retirement, (ii)
permanent disability, or (iii) death, the Option may be exercised as provided in
the Vesting Schedule (subject to the accelerated vesting provisions of Paragraph
2 hereof) at any time within a period of five (5) years following the date of
such termination by Optionee, or in the event of Optionee's death, by the person
or persons to whom Optionee's rights under the Option shall pass by will or by
the laws of descent or distribution; provided, however, that if Optionee shall
become employed by or provide services in any manner to a competitor of the
Company or any subsidiary thereof, the Option shall terminate immediately and
may not be exercised.

 

2.    If Optionee has completed at least six months of continuous employment
following the date the Option was granted and Optionee's continuous employment
is terminated by (i) death or (ii) retirement or permanent disability and
Optionee dies within three (3) years following the date of such termination, the
Option shall be fully exercisable upon Optionee's death notwithstanding the
installment exercise provisions of the Vesting Schedule.

 

 

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Exhibit 10.6

 

3.     Nothing contained in Paragraph 1 or Paragraph 2 hereof is intended to
extend the stated term of the Option, and in no event may the Option be
exercised after the Option Term has expired.

 

4.    The Option is exercisable, during the lifetime of the Optionee, only by
the Optionee. The Option shall not be sold, pledged, assigned or transferred in
any manner otherwise than by will or the laws of descent and distribution, and
shall not be subject to attachment or similar process. Any attempted sale,
pledge, assignment, transfer or other disposition of the Option contrary to the
provisions hereof and the levy of any attachment or similar process upon the
Option shall be null and void and without effect.

 

5.    In the event there is any change in the shares of the Company through the
declaration of stock dividends or a stock split-up, or through any
recapitalization resulting in share split-up, or combinations or exchanges of
shares, or otherwise, the number of shares subject to the Option and the
purchase price of such shares shall be appropriately adjusted by the Option
Committee. No fractional shares shall be issued upon any exercise of the Option.

 

6.     Subject to the terms and conditions of this Agreement, the Option may be
exercised by giving notice to the Company at such location and in such form,
which may be electronic, as the Company may designate. Such notice shall (i)
state the election to exercise the Option and the number of full shares in
respect of which it is being exercised, and (ii) be signed by the person or
persons so exercising the Option and, in the event the Option is being exercised
(pursuant to Paragraph 1 hereof) by any person or persons other than the
Optionee, be accompanied by appropriate proof of the right of such person or
persons to exercise the Option. Such notice may be in electronic form and shall
be accompanied by payment of the full purchase price of such shares, whereupon
the Company shall issue and deliver, or cause to be issued and delivered a
certificate or certificates representing such shares, which may be in book entry
form, as soon as practicable after such notice is received. The purchase price
for such shares must be paid in full in cash, or paid in full in Common Stock of
the Company held by the Optionee for at least six months or a combination of
cash and Common Stock held for at least six months by the Optionee. Common Stock
tendered in full or partial payment of the purchase price shall be valued at the
opening price of the Common Stock on the New York Stock Exchange on the date of
exercise, or if there is no trading on such date, then on the first previous
date on which there was such trading. The payment of all or part of the required
withholding taxes due upon exercise of the Option, up to the highest marginal
rates then in effect, may be made by the withholding of shares otherwise
issuable upon exercise of the Option. Option shares withheld in payment of such
taxes shall be valued at the opening price of the Company's Common Stock on the
New York Stock Exchange on the date of exercise, or if there is no trading on
such date, then on the first previous date on which there was such trading. The
certificate or certificates for the shares as to which the Option shall have
been so exercised shall be registered in the name of the person or persons so
exercising the Option and shall be delivered as aforesaid to or upon the written
order of the person or persons exercising the Option. The date of the exercise
of the Option will be the date on which the aforesaid notice, properly executed
and accompanied as aforesaid, is received by the Company. All shares that

 

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shall be purchased upon the exercise of the Option as provided herein shall be
fully paid and nonassessable. Until the certificate or certificates have been
issued as aforesaid, the person or persons exercising the Option shall possess
no rights of a record holder with respect to any of such shares.

 

7.     The Company will seek to obtain from each regulatory commission or agency
having jurisdiction such authority as may be required to issue and sell the
shares of stock subject to the Option. Inability of the Company to obtain from
any such regulatory commission or agency authority which counsel for the Company
deems necessary for the lawful issuance and sale of its stock to satisfy the
Option shall relieve the Company from any liability for failure to issue and
sell stock to satisfy the Option pending the time when such authority is
obtained or is obtainable.

 

8.     By entering into this Agreement and accepting the grant of an option
evidenced hereby, Optionee acknowledges that: (i) the Plan is discretionary in
nature and may be amended, suspended or terminated by the Company at any time;
(ii) the grant of the Option is a one-time benefit which does not create any
contractual or other right to receive future grants of options, or benefits in
lieu of options; (iii) all determinations with respect to any such future
grants, including, but not limited to, the times when options shall be granted,
the number of shares subject to each option, the option price, and the time or
times when each option shall be exercisable, will be at the sole discretion of
the Company and the Committee; (iv) the Optionee's receipt of this Option shall
not create a right to further employment with the Company and shall not
interfere with the ability of the Company to terminate the Optionee's employment
relationship at any time with or without cause; (v) the Optionee's participation
in the Plan is voluntary; (vi) the value of the Option is an extraordinary item
of compensation which is outside the scope of the Optionee's employment
contract, if any; (vii) the Option is not part of normal or expected
compensation for purposes of calculating any severance, resignation, redundancy,
end of service payments, bonuses, long-service awards, pension or retirement
benefits or similar payments; (viii) the future value of the underlying shares
is unknown and cannot be predicted with certainty; and (ix) if the underlying
shares do not increase in value, the Option will have no value.

 

9.    For Optionees employed at international locations: The Company and/or the
Optionee's employer will assess its requirements regarding tax, social insurance
and any other payroll tax (Tax-Related Items") withholding and reporting in
connection with the Option, including the grant, vesting or exercise of the
Option or sale of shares acquired pursuant to such exercise. These requirements
may change from time to time as laws or interpretations change. Regardless of
the actions of the Company and/or the Optionee's employer in this regard, the
Optionee hereby acknowledges and agrees that the ultimate liability for any and
all Tax-Related Items is and remains his or her responsibility and liability and
that the Company and/or the Optionee's employer (i) makes no representations nor
undertakings regarding treatment of any Tax-Related Items in connection with any
aspect of the Option grant, including the grant, vesting or exercise of the
Option and the subsequent sale of shares acquired pursuant to such exercise; and
(ii) does not commit to structure the terms of the

 

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grant or any aspect of the Option to reduce or eliminate the Optionee's
liability regarding Tax-Related Items. In the event that the Company and/or the
Optionee's employer must withhold any Tax-Related Items as a result of the
grant, vesting, or exercise of the Option or sale of shares, the Optionee agrees
to make arrangements satisfactory to the Company and/or the Optionee's employer
to satisfy all withholding requirements. The Optionee authorizes the Company
and/or the Optionee's employer to withhold all applicable Tax-Related Items
legally due from the Optionee from his or her wages or other cash compensation
paid him or her by the Company and/or the Optionee's employer or from proceeds
from the sale of shares.

 

10.    As a condition of the grant of the Option, the Optionee consents to the
collection, use and transfer of personal data as described in this Paragraph 10.
The Optionee understands that the Company and its subsidiaries hold certain
personal information about the Optionee, including the Optionee's name, home
address and telephone number, date of birth, social security number or
identification number, salary, nationality, job title, any shares of stock or
directorships held in the Company, details of all options or any other
entitlement to shares of stock awarded, cancelled, exercised, vested, unvested
or outstanding in the Optionee's favor, for the purpose of managing and
administering the Plan ("Data"). The Optionee further understands that the
Company and/or its subsidiaries will transfer Data amongst themselves as
necessary for the purpose of implementation, administration and management of
the Optionee's participation in the Plan, and that the Company and/or any of its
subsidiaries may each further transfer Data to any third parties assisting the
Company in the implementation, administration and management of the Plan. The
Optionee understands that these recipients may be located in the European
Economic Area, or elsewhere, such as the United States. The Optionee authorizes
them to receive, possess, use, retain and transfer the Data, in electronic or
other form, for the purposes of implementing, administering and managing the
Optionee's participation in the Plan, including any requisite transfer to a
broker or other third party with whom the Optionee may elect to deposit any
shares of stock acquired upon exercise of the Option such Data as may be
required for the administration of the Plan and/or the subsequent holding of
shares of stock on his or her behalf. The Optionee understands that he or she
may, at any time, view Data, require any necessary amendments to it or withdraw
the consents herein in writing by contacting his or her local Human Resources
representative. Withdrawal of consent may, however, affect Optionee's ability to
exercise or realize benefits from the Option.

 

11.    Capitalized terms not defined herein or in the Notice of Grant of Stock
Option and Agreement shall have the meaning ascribed to them in the Plan.
Moreover, as used in this Option Agreement, the following terms shall have the
meanings set forth in this Paragraph 11:

 

 

(a)

"subsidiary": any corporation in which the Company controls, directly or
indirectly, 50% or more of the combined voting power of all classes of stock;

 

 

(b)

"continuous employment": the absence of any interruption or termination of
employment by the Company or any of its subsidiaries. Employment shall not be
considered interrupted

 

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in the case of transfers between payroll locations of the Company and/or its
subsidiaries, or in the case of sick leave or any other leave of absence
approved by the Company;

 

 

(c)

"retirement": a permanent termination of employment with the Company or any of
its subsidiaries (i) after reaching age sixty-five (65) or after reaching age
fifty five (55) and the Optionee's age plus years of service in the employ of
the Company or any of its subsidiaries is sixty-five (65) or more, and (ii) with
no intention to engage in a full-time vocation;

 

 

(d)

"permanent disability": a permanent and total incapacity to perform any services
for the Company or any of its subsidiaries;

 

 

(e)

"Committee": the Compensation Committee of the Board of Directors of the
Company.

 

12.    This Option Agreement shall be governed by the laws of the State of
Delaware.

 

13.    This Option is granted pursuant to the Plan specified in the Notice of
Grant of Stock Option and Option Agreement. A copy of the Plan is available in
electronic form on the Company's Human Resources website or in hard copy from
the Stock Administration department and is by reference incorporated herein. In
the event of any inconsistency between the terms hereof and the provisions of
the Plan, the Plan shall govern.

 

 

 

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