EXHIBIT 10.3

THE SECURITIES REPRESENTED BY THIS AGREEMENT HAVE NOT BEEN REGISTERED OR
QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, PLEDGED, OR OTHERWISE DISPOSED OF UNLESS SO REGISTERED
OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED BY AN OPINION OF COUNSEL TO THE REGISTERED HOLDER (WHICH OPINION AND
COUNSEL SHALL BOTH BE SATISFACTORY TO THE COMPANY).

INFOSONICS CORPORATION

AMENDED AND RESTATED STOCK OPTION AGREEMENT
(Non-Employee Directors’ Option)

THIS AMENDED AND RESTATED STOCK OPTION AGREEMENT (this “Agreement”) is made and
entered into as of this 13th day of April 2006 and shall be effective as of the
___ day of ______ 2005, to the same extent as if it had been entered into on
that date, by and between InfoSonics Corporation, a Maryland corporation (the
“Company”), and ____________ (the “Optionee”) with respect to the non-qualified
stock option described below (the “Option”) granted by the Company to the
Optionee as of ____________ 2005. The Option is granted outside the Company’s
2003 Stock Option Plan (the “2003 Plan”), but, to the extent applicable, is
subject to all the terms and conditions of the 2003 Plan, unless otherwise
provided in this Agreement. This Agreement replaces and supersedes any other
agreement Optionee may have received with respect to the ____________, 2005
Option and, in consideration of this Agreement, Optionee agrees that he shall
have no further rights under any such other prior agreement.

WITNESSETH:

WHEREAS, effective as of __________, 200_, the Optionee was elected as a
director of the Company;

WHEREAS, the Company agreed to issue to the Optionee an Option to purchase
shares of the $.001 par value common stock of the Company (“Common Stock”), said
Option to be for the number of shares, at the price per share and on the terms
set forth in this Agreement;

WHEREAS, the Optionee is a Non-Employee Director, as defined in the 2003 Plan;
and

WHEREAS, the Optionee desires to receive the Option on the terms and conditions
set forth in this Agreement.

NOW, THEREFORE, the parties agree as follows:

1.      Grant Of Option. Subject to stockholder approval of the terms of this
Agreement at the 2006 Annual Meeting of Stockholders and satisfaction of
American Stock Exchange (“AMEX”) listing requirements for the shares subject to
the Option, the Company hereby grants to the Optionee the Option to purchase all
or any part of an aggregate of 15,000 shares of Common Stock of the Company (the
“Option Shares”) pursuant to the terms and conditions set forth in this
Agreement.

2.      Option Price. At any time when shares are to be purchased pursuant to
the Option, the purchase price (the “Option Price”) for each Option Share shall
be $________ per share, subject to adjustment as provided in this Agreement.

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

 

3.      Vesting/Exercise Period.

(a)          The Option shall be fully vested as of ____________. However, no
portion of the Option shall become exercisable until the date, if any, that
(i) the stockholders of the Company approve the terms of this Agreement and
(ii) AMEX approves the listing of the Option Shares. Upon satisfaction of both
conditions, the Option shall become fully exercisable. If the stockholders do
not approve the terms of this Agreement at the 2006 Annual Meeting of
Stockholders or AMEX does not approve listing of the Option Shares, this
Agreement and any prior agreement regarding the ________2005 Option shall
immediately terminate and the Optionee shall have no further rights under the
Option.

(b)         The period for the exercise of the Option shall terminate at
5:00 p.m., San Diego, California time on ____________, unless the Option is
terminated earlier as provided in this Agreement. Notwithstanding the foregoing,
to the extent not earlier terminated, the vested and exercisable portion of the
Option shall terminate three months after the Optionee ceases to be a director
of the Company.

4.      Exercise Of Option.

(a)          The Option may be exercised in whole or in part by delivering to
the Treasurer of the Company (i) a Notice And Agreement Of Exercise Of Option,
substantially in the form attached hereto as Exhibit A, specifying the number of
Option Shares with respect to which the Option is exercised, and (ii) full
payment of the Option Price for such shares. Payment shall be made by certified
check or cleared funds. The Option may not be exercised in part unless the
purchase price for the Option Shares purchased is at least $1,000 or unless the
entire remaining portion of the Option is being exercised.

(b)         Promptly upon receipt of the Notice And Agreement Of Exercise Of
Option together with the full payment of the Option Price, the Company shall
deliver to the Optionee a properly executed certificate or certificates
representing the Option Shares being purchased.

(c)          During the lifetime of the Optionee, the Option shall be
exercisable only by the Optionee or a Permitted Transferee (as defined in
Section 7 of this Agreement); provided, that in the event of the legal
disability of the Optionee, the guardian or personal representative of the
Optionee may exercise the Option. Following the death of the Optionee, the
Option may be exercised by the personal representative of the Optionee during
any remaining term of the Option.

(d)         (1)           If for any reason (other than as a result of the
removal of Optionee as a director of the Company) the Optionee ceases to be a
director of the Company, then the Option may be exercised within three months
after the date Optionee ceases to be a director of the Company, but only to the
extent that (A) the Option was exercisable according to its terms on the date
Optionee ceased to be a director of the Company, and (B) the period for exercise
of the Option, as defined in Section 3 of this Agreement, has not terminated as
of the date of exercise. Upon termination of the respective periods set forth in
the previous sentence, any unexercised portion of the Option shall expire.

(2)            If the Optionee is removed as a director of the Company by a vote
of stockholders in accordance with the law of the Company’s state of
incorporation, the Option shall expire upon delivery to the Optionee of notice
of removal, which may be oral or in writing, and all rights to purchase shares
pursuant to the Option shall terminate immediately upon the delivery of such
notice of removal.

5.      Withholding Taxes. The Company may take such steps as it deems necessary
or appropriate for the withholding of any taxes which the Company is required by
any law or regulation or any governmental authority, whether federal, state or
local, domestic or foreign, to withhold in connection

2

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

with the Option including, but not limited to, the withholding of all or any
portion of any payment owed by the Company to the Optionee or the withholding of
issuance of Option Shares to be issued upon the exercise of the Option.

6.      Securities Laws Requirements. No Option Shares shall be issued unless
and until, in the opinion of the Company, there has been full compliance with,
or an exemption from, any applicable registration requirements of the Securities
Act of 1933, as amended (the “1933 Act”), any applicable listing requirements of
any securities exchange on which stock of the same class has been listed, and
any other requirements of law or any regulatory bodies having jurisdiction over
such issuance and delivery, or applicable exemptions are available and have been
complied with. Pursuant to the terms of the Notice And Agreement Of Exercise Of
Option (Exhibit A) that shall be delivered to the Company upon each exercise of
the Option, the Optionee shall acknowledge, represent, warrant and agree as
follows, to the extent required by the Company:

(a)          Optionee is acquiring the Option Shares for investment purposes
only and the Option Shares that Optionee is acquiring will be held by Optionee
without sale, transfer or other disposition for an indefinite period unless the
transfer of those securities is subsequently registered under the federal
securities laws or unless exemptions from registration are available;

(b)         Optionee’s overall commitment to investments that are not readily
marketable is not disproportionate to Optionee’s net worth and Optionee’s
investment in the Option Shares will not cause such overall commitments to
become excessive;

(c)          Optionee’s financial condition is such that Optionee is under no
present or contemplated future need to dispose of any portion of the Option
Shares to satisfy any existing or contemplated undertaking, need or
indebtedness;

(d)         Optionee has sufficient knowledge and experience in business and
financial matters to evaluate, and Optionee has evaluated, the merits and risks
of an investment in the Option Shares;

(e)          The address set forth on the signature page to this Agreement is
Optionee’s true and correct residence, and Optionee has no present intention of
becoming a resident of any other state or jurisdiction;

(f)          Optionee confirms that all documents, records and books pertaining
to an investment in the Option and the Option Shares that have been requested by
Optionee have been made available or delivered to Optionee. Without limiting the
foregoing, Optionee has received and reviewed the Company’s periodic reports as
filed with the Securities and Exchange Commission, and Optionee has had the
opportunity to discuss the acquisition of the Option and the Option Shares with
the Company, and Optionee has obtained or been given access to all information
concerning the Company that Optionee has requested;

(g)         Optionee has had the opportunity to ask questions of, and receive
the answers from, the Company concerning the terms of the investment in the
Option Shares and to receive additional information necessary to verify the
accuracy of the information delivered to Optionee, to the extent that the
Company possesses such information or can acquire it without unreasonable effort
or expense;

(h)         Optionee understands that the Options and the Option Shares issuable
upon exercise of the Options have not been registered under the 1933 Act or any
state securities laws, and no

3

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

 

federal or state agency has made any finding or determination as to the fairness
of this investment or any recommendation or endorsement of the sale of the
Option Shares;

(i)           The Option Shares that Optionee is acquiring will be solely for
Optionee’s own account, for investment, and are not being purchased with a view
to or for the resale, distribution, subdivision or fractionalization thereof.
Optionee has no agreement or arrangement for any such resale, distribution,
subdivision or fractionalization thereof;

(j)           Optionee acknowledges and is aware of the following:

(i)            The Company has a history of losses. The Option Shares constitute
a speculative investment and involve a high degree of risk of loss by Optionee
of Optionee’s total investment in the Option Shares.

(ii)           There are substantial restrictions on the transferability of the
Option Shares. Except as otherwise provided in Section 7 of this Agreement, the
Option Shares cannot be transferred, pledged, hypothecated, sold or otherwise
disposed of unless they are registered under the 1933 Act or an exemption from
such registration is available and established to the satisfaction of the
Company; investors in the Company have no rights to require that the Option
Shares be registered; there is no right of presentment of the Option Shares and
there is no obligation by the Company to repurchase any of the Option Shares;
and, accordingly, Optionee may have to hold the Option Shares indefinitely and
it may not be possible for Optionee to liquidate Optionee’s investment in the
Company.

(iii)          Unless the issuance of the Option Shares is registered, each
certificate issued representing the Option Shares shall be imprinted with a
legend that sets forth a description of the restrictions on transferability of
those securities, which legend will read substantially as follows:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED OR
QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, PLEDGED, OR OTHERWISE DISPOSED OF UNLESS SO REGISTERED
OR QUALIFIED OR UNLESS AN EXEMPTION EXISTS, THE AVAILABILITY OF WHICH IS TO BE
ESTABLISHED BY AN OPINION OF COUNSEL TO THE REGISTERED HOLDER (WHICH OPINION AND
COUNSEL SHALL BOTH BE SATISFACTORY TO THE COMPANY).”

(k)          No Option Shares shall be sold or otherwise distributed in
violation of the 1933 Act or any other applicable federal or state securities
laws;

(l)           The Company may, without liability for its good faith actions,
place legend restrictions upon the certificates representing the Option Shares
and issue “stop transfer” instructions requiring compliance with applicable
securities laws and the terms of the Option;

(m)         The Optionee shall report all sales of Option Shares to the Company
in writing on a form prescribed by the Company; and

4

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

 

(n)           If and so long as the Optionee is subject to reporting
requirements under Section 16(a) of the Securities Exchange Act of 1934, as
amended (the “1934 Act”), the Optionee shall (i) be aware that any sale by the
Optionee or the Optionee’s immediate family of shares of the Company’s Common
Stock or any of the Option Shares within six months before or after any
transaction deemed to be a “purchase” of an equity security of the Company may
create liability for the Optionee under Section 16(b) of the 1934 Act,
(ii) consult with the Optionee’s counsel regarding the application of
Section 16(b) of the 1934 Act prior to any exercise of the Option, and prior to
any sale of shares of the Company’s Common Stock or the Option Shares,
(iii) furnish the Company with a copy of each Form 4 filed by the Optionee, and
(iv) timely file all reports required under the federal securities laws.

The restrictions described in this Section 6 may be placed on the certificates
representing the Option Shares purchased pursuant to the Option, and the Company
may refuse to issue the certificates or to transfer the Option Shares on its
books unless it is satisfied that no violation of such restrictions will occur.

7.      Transferability Of Option. No Option shall be transferable by the
Optionee otherwise than by will or by the laws of descent and distribution or
pursuant to a domestic relations order (within the meaning of Rule 12a-12
promulgated under the 1934 Act), and Options shall be exercisable during the
lifetime of an Optionee only by the Optionee or the Optionee’s guardian or legal
representative. Notwithstanding the foregoing, Options may be transferred to
Permitted Transferees (as defined below) of the Optionee, and for purposes of
this Agreement, a Permitted Transferee of an Optionee shall be deemed to be the
Optionee. The terms of an Option shall be final, binding and conclusive upon the
beneficiaries, executors, administrators, heirs and successors of the Optionee.
A “Permitted Transferee” means Optionee’s immediate family, trusts solely for
the benefit of such family members and partnerships in which such family members
and/or trusts are the only partners. For this purpose, immediate family of a
person means the person’s spouse, parents, children, stepchildren and
grandchildren and the spouses of such parents, children, stepchildren and
grandchildren.

8.      Adjustment By Stock Split, Stock Dividend, Etc. If at any time the
Company increases or decreases the number of its outstanding shares of Common
Stock, or changes in any way the rights and privileges of such shares, by means
of the payment of a stock dividend or the making of any other distribution on
such shares payable in its Common Stock, or through a stock split or subdivision
of shares, or a consolidation or combination of shares, or through a
reclassification or recapitalization involving its Common Stock, the numbers,
rights and privileges of the shares of Common Stock included in the Option shall
be increased, decreased or changed in like manner as if such shares had been
issued and outstanding, fully paid and nonassessable at the time of such
occurrence.

9.      Change in Control and Reorganization Events.

Upon consummation of a “Change in Control” or a “Reorganization Event” (as such
terms are defined in the 2003 Plan), the Option shall terminate to the extent
not exercised or cashed out, which cash out, if any, shall occur in accordance
with the terms and conditions applicable to other outstanding options under the
2003 Plan.

10.    Registration Rights. Optionee shall have no registration rights unless
otherwise agreed by the Company.

11.    Common Stock To Be Received Upon Exercise. Optionee understands that
(a) the Company is under no obligation to register the issuance of the Option
Shares, and (b) in the absence of any such registration, the Option Shares
cannot be sold unless they are sold pursuant to an exemption from registration
under the 1933 Act. Optionee also understands that with respect to Rule 144,
routine

5

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

sales of securities made in reliance upon such Rule can be made only in limited
amounts in accordance with the terms and conditions of the Rule, and that in
cases in which the Rule is inapplicable, compliance with either Regulation A or
another disclosure exemption under the 1933 Act will be required. Thus, the
Option Shares will have to be held indefinitely in the absence of registration
under the 1933 Act or an exemption from registration.

12.    Privilege Of Ownership. Optionee shall not have any of the rights of a
stockholder with respect to the shares covered by the Option except to the
extent that one or more certificates for such shares shall be delivered to him
upon exercise of the Option.

13.    Relationship To Employment Or Position. Nothing contained in this
Agreement (i) shall confer upon the Optionee any right with respect to
employment or continuance of service as a director of the Company, or (ii) shall
interfere in any way with the right of the Company at any time to remove
Optionee as a director of the Company or determine not to nominate Optionee for
an additional term as a director.

14.    Section 409A Compliance. Notwithstanding anything in this Agreement or
the Plan to the contrary, the Company may adopt such amendments to this
Agreement and adopt other policies and procedures (including amendments,
policies and procedures with retroactive effect) or take other actions that the
Company determines are necessary or appropriate to exempt the Award from
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), or
to comply with Section 409A of the Code.

15.    Notices. All notices, requests, demands, directions and other
communications (“Notices”) concerning this Agreement shall be in writing and
shall be mailed or delivered personally or sent by telecopier or facsimile to
the applicable party at the address of such party set forth below in this
Section 15. When mailed, each such Notice shall be sent by first class,
certified mail, return receipt requested, enclosed in a postage prepaid wrapper,
and shall be effective on the fifth business day after it has been deposited in
the mail. When delivered personally, each such Notice shall be effective when
delivered to the address for the respective party set forth in this Section 15,
provided that it is delivered on a business day and further provided that it is
delivered prior to 5:00 p.m., local time of the party to whom the Notice is
being delivered, on that business day; otherwise, each such Notice shall be
effective on the first business day occurring after the Notice is delivered.
When sent by telecopier or facsimile, each such Notice shall be effective on the
day on which it is sent provided that it is sent on a business day and further
provided that it is sent prior to 5:00 p.m., local time of the party to whom the
Notice is being sent, on that business day; otherwise, each such Notice shall be
effective on the first business day occurring after the Notice is sent. Each
such Notice shall be addressed to the party to be notified as shown below:

 

(a)

if to the Company:

InfoSonics Corporation

 

 

 

5880 Pacific Center Blvd.

 

 

 

San Diego, California 92121

 

 

 

Facsimile No. (858) 373-1503

 

 

 

Attention: President

 

(b)

if to the Optionee:

__________________

 

 

 

At the address set forth on the signature page

 

 

 

of this Agreement

 

Either party may change its respective address for purposes of this Section 15
by giving the other party Notice of the new address in the manner set forth
above.

6

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

 

16.    General Provisions. This instrument (a) contains the entire agreement
between the parties, (b) subject to Section 14 of this Agreement, may not be
amended nor may any rights hereunder be waived except by an instrument in
writing signed by the party sought to be charged with such amendment or waiver,
(c) shall be construed in accordance with, and governed by the laws of
California, except where conflicts of law rules require the application of
Maryland law, and (d) shall be binding upon and shall inure to the benefit of
the parties and their respective personal representatives and assigns, except as
above set forth. All pronouns contained herein and any variations thereof shall
be deemed to refer to the masculine, feminine or neuter, singular or plural as
the identity of the parties hereto may require.

IN WITNESS WHEREOF, the parties have executed this Agreement on the dates set
forth below.

 

 

 

 

INFOSONICS CORPORATION

 

 

 

 

 

 

 

 

 

 

Date:

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Printed Name And Title

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPTIONEE

 

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Address

 

 

 

 

 

 

 

 

 

 

 

 

 

 

City, State and Zip Code

 

 

 

 

Facsimile No. (      )

 

7

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