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Exhibit 10.4    
    


 
 
 

TECHWELL, INC.    
    
    2006 STOCK INCENTIVE PLAN    
    
    (Adopted by the Board on November 17, 2005)    




        















TECHWELL, INC.

2006 STOCK INCENTIVE PLAN







 
Table of Contents  



	 
	 
	 	Page
 

	SECTION 1.	ESTABLISHMENT AND PURPOSE.	 	1
	
SECTION 2.	
DEFINITIONS.	
 	

1
	

               (a)	

"Affiliate"	
 	

1
	

               (b)	

"Award"	
 	

1
	

               (c)	

"Board of Directors"	
 	

1
	

               (d)	

"Change in Control"	
 	

1
	

               (e)	

"Code"	
 	

2
	

               (f)	

"Committee"	
 	

2
	

               (g)	

"Company"	
 	

2
	

               (h)	

"Consultant"	
 	

2
	

               (i)	

"Employee"	
 	

3
	

               (j)	

"Exchange Act"	
 	

3
	

               (k)	

"Exercise Price"	
 	

3
	

               (l)	

"Fair Market Value"	
 	

3
	

               (m)	

"ISO"	
 	

3
	

               (n)	

"Nonstatutory Option" or "NSO"	
 	

3
	

               (o)	

"Offeree"	
 	

3
	

               (p)	

"Option"	
 	

4
	

               (q)	

"Optionee"	
 	

4
	

               (r)	

"Outside Director"	
 	

4
	

               (s)	

"Parent"	
 	

4
	

               (t)	

"Participant"	
 	

4
	

               (u)	

"Plan"	
 	

4
	

               (v)	

"Purchase Price"	
 	

4
	

               (w)	

"Restricted Share"	
 	

4
	

               (x)	

"Restricted Share Agreement"	
 	

4
	

               (y)	

"SAR"	
 	

4
	

               (z)	

"SAR Agreement"	
 	

4
	

               (aa)	

"Service"	
 	

4
	

               (bb)	

"Share"	
 	

4
	

               (cc)	

"Stock"	
 	

5
	

               (dd)	

"Stock Option Agreement"	
 	

5
	

               (ee)	

"Stock Unit"	
 	

5
	

               (ff)	

"Stock Unit Agreement"	
 	

5
	 	 	 	 



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               (gg)	

"Subsidiary"	
 	

5
	
SECTION 3.	
ADMINISTRATION.	
 	

5
	

               (a)	

Committee Composition	
 	

5
	

               (b)	

Committee for Non-Officer Grants	
 	

5
	

               (c)	

Committee Procedures	
 	

5
	

               (d)	

Committee Responsibilities	
 	

6
	
SECTION 4.	
ELIGIBILITY.	
 	

7
	

               (a)	

General Rule	
 	

7
	

               (b)	
Automatic Grants to Outside Directors	
 	

7
	

               (c)	

Ten-Percent Stockholders	
 	

8
	

               (d)	

Attribution Rules	
 	

8
	

               (e)	

Outstanding Stock	
 	

8
	
SECTION 5.	
STOCK SUBJECT TO PLAN.	
 	

8
	

               (a)	

Basic Limitation	
 	

8
	

               (b)	

Award Limitation	
 	

9
	

               (c)	

Additional Shares	
 	

9
	
SECTION 6.	
RESTRICTED SHARES.	
 	

9
	

               (a)	

Restricted Stock Agreement	
 	

9
	

               (b)	

Payment for Awards	
 	

9
	

               (c)	

Vesting	
 	

9
	

               (d)	

Voting and Dividend Rights	
 	

9
	

               (e)	

Restrictions on Transfer of Shares	
 	

10
	
SECTION 7.	
TERMS AND CONDITIONS OF OPTIONS.	
 	

10
	

               (a)	

Stock Option Agreement	
 	

10
	

               (b)	

Number of Shares	
 	

10
	

               (c)	

Exercise Price	
 	

10
	

               (d)	

Withholding Taxes	
 	

10
	

               (e)	

Exercisability and Term	
 	

10
	

               (f)	

Exercise of Options	
 	

11
	

               (g)	

Effect of Change in Control	
 	

11
	

               (h)	

No Rights as a Stockholder	
 	

11
	

               (i)	

Modification, Extension and Renewal of Options	
 	

11
	

               (j)	

Restrictions on Transfer of Shares	
 	

11
	

               (k)	

Buyout Provisions	
 	

11
	
SECTION 8.	
PAYMENT FOR SHARES.	
 	

11
	

               (a)	

General Rule	
 	

12
	

               (b)	

Surrender of Stock	
 	

12
	 	 	 	 



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               (c)	

Services Rendered	
 	

12
	

               (d)	

Cashless Exercise	
 	

12
	

               (e)	

Exercise/Pledge	
 	

12
	

               (f)	

Promissory Note	
 	

12
	

               (g)	

Other Forms of Payment	
 	

12
	

               (h)	

Limitations under Applicable Law	
 	

12
	
SECTION 9.	
STOCK APPRECIATION RIGHTS.	
 	

12
	

               (a)	

SAR Agreement	
 	

12
	

               (b)	

Number of Shares	
 	

13
	

               (c)	

Exercise Price	
 	

13
	

               (d)	

Exercisability and Term	
 	

13
	

               (e)	

Effect of Change in Control	
 	

13
	

               (f)	

Exercise of SARs	
 	

13
	

               (g)	

Modification or Assumption of SARs	
 	

13
	

               (h)	

Buyout Provisions	
 	

13
	
SECTION 10.	
STOCK UNITS.	
 	

13
	

               (a)	

Stock Unit Agreement	
 	

14
	

               (b)	

Payment for Awards	
 	

14
	

               (c)	

Vesting Conditions	
 	

14
	

               (d)	

Voting and Dividend Rights	
 	

14
	

               (e)	

Form and Time of Settlement of Stock Units	
 	

14
	

               (f)	

Death of Recipient	
 	

14
	

               (g)	

Creditors' Rights	
 	

15
	
SECTION 11.	
ADJUSTMENT OF SHARES.	
 	

15
	

               (a)	

Adjustments	
 	

15
	

               (b)	

Dissolution or Liquidation	
 	

15
	

               (c)	

Reorganizations	
 	

15
	

               (d)	

Reservation of Rights	
 	

16
	
SECTION 12.	
DEFERRAL OF AWARDS.	
 	

16
	

               (a)	

Committee Powers	
 	

16
	

               (b)	

General Rules	
 	

16
	
SECTION 13.	
AWARDS UNDER OTHER PLANS.	
 	

17
	
SECTION 14.	
PAYMENT OF DIRECTOR'S FEES IN SECURITIES.	
 	

17
	

               (a)	

Effective Date	
 	

17
	

               (b)	

Elections to Receive NSOs, Restricted Shares or Stock Units	
 	

17
	

               (c)	

Number and Terms of NSOs, Restricted Shares or Stock Units	
 	

17
	
SECTION 15.	
LEGAL AND REGULATORY REQUIREMENTS.	
 	

17
	 	 	 	 



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SECTION 16.	
WITHHOLDING TAXES.	
 	

17
	

               (a)	

General	
 	

18
	

               (b)	

Share Withholding	
 	

18
	
SECTION 17.	
OTHER PROVISIONS APPLICABLE TO AWARDS.	
 	

18
	

               (a)	

Transferability	
 	

18
	

               (b)	

Qualifying Performance Criteria	
 	

18
	
SECTION 18.	
NO EMPLOYMENT RIGHTS.	
 	

19
	
SECTION 19.	
DURATION AND AMENDMENTS.	
 	

19
	

               (a)	

Term of the Plan	
 	

19
	

               (b)	

Right to Amend or Terminate the Plan	
 	

19
	

               (c)	

Effect of Termination	
 	

20
	
SECTION 20.	
EXECUTION.	
 	

21




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   TECHWELL, INC.  


 2006 STOCK INCENTIVE PLAN  



SECTION 1.    ESTABLISHMENT AND PURPOSE.  


        The Plan was adopted by the Board of Directors on November 17, 2005, and shall be effective as of the date of the initial offering of Stock to the public
pursuant to a registration statement filed by the Company with the Securities and Exchange Commission (the "Effective Date"). The purpose of the Plan is to promote the long-term success of
the Company and the creation of stockholder value by (a) encouraging Employees, Outside Directors and Consultants to focus on critical long-range objectives, (b) encouraging
the attraction and retention of Employees, Outside Directors and Consultants with exceptional qualifications and (c) linking Employees, Outside Directors and Consultants directly to stockholder
interests through increased stock ownership. The Plan seeks to achieve this purpose by providing for Awards in the form of restricted shares, stock units, options (which may constitute incentive stock
options or nonstatutory stock options) or stock appreciation rights. 


SECTION 2.    DEFINITIONS.  


        (a)   "Affiliate" shall mean any entity other than a Subsidiary, if the Company and/or one of more Subsidiaries own not less
than 50% of such entity. 


        (b)   "Award" shall mean any award of an Option, a SAR, a Restricted Share or a Stock Unit under the Plan. 


        (c)   "Board of Directors" shall mean the Board of Directors of the Company, as constituted from time to time. 


        (d)   "Change in Control" shall mean the occurrence of any of the following events: 



        (i)    A
change in the composition of the Board of Directors occurs, as a result of which fewer than one-half of the incumbent directors are directors who either: 



        (A)  Had
been directors of the Company on the "look-back date" (as defined below) (the "original directors"); or 


        (B)  Were
elected, or nominated for election, to the Board of Directors with the affirmative votes of at least a majority of the aggregate of the original directors who were
still in office at the time of the election or nomination and the directors whose election or nomination was previously so approved (the "continuing directors"); or 




        (ii)   Any
"person" (as defined below) who by the acquisition or aggregation of securities, is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the combined voting power of the Company's then outstanding securities 



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ordinarily
(and apart from rights accruing under special circumstances) having the right to vote at elections of directors (the "Base Capital Stock"); except that any change in the relative beneficial
ownership of the Company's securities by any person resulting solely from a reduction in the aggregate number of outstanding shares of Base Capital Stock, and any decrease thereafter in such person's
ownership of securities, shall be disregarded until such person increases in any manner, directly or indirectly, such person's beneficial ownership of any securities of the Company; or 


        (iii)  The
consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not stockholders of
the Company immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization 50% or more of the voting power of the
outstanding securities of each of (A) the continuing or surviving entity and (B) any direct or indirect parent corporation of such continuing or surviving entity; or 


        (iv)  The
sale, transfer or other disposition of all or substantially all of the Company's assets. 




        For
purposes of subsection (d)(i) above, the term "look-back" date shall mean the later of (1) the Effective Date or (2) the date 24 months prior
to the date of the event that may constitute a Change in Control. 


        For
purposes of subsection (d)(ii)) above, the term "person" shall have the same meaning as when used in Sections 13(d) and 14(d) of the Exchange Act but shall exclude (1) a
trustee or other fiduciary holding securities under an employee benefit plan maintained by the Company or a Parent or Subsidiary and (2) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their ownership of the Stock. 


        Any
other provision of this Section 2(d) notwithstanding, a transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company's
incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company's securities immediately before such transaction, and a Change
in Control shall not be deemed to occur if the Company files a registration statement with the United States Securities and Exchange Commission for the initial offering of Stock to the public. 


        (e)   "Code" shall mean the Internal Revenue Code of 1986, as amended. 


        (f)    "Committee" shall mean the Compensation Committee as designated by the Board of Directors, which is authorized to
administer the Plan, as described in Section 3 hereof. 


        (g)   "Company" shall mean Techwell, Inc., a Delaware corporation. 


        (h)   "Consultant" shall mean a consultant or advisor who provides bona fide services to the Company, a Parent, a Subsidiary or
an Affiliate as an independent contractor (not 


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including
service as a member of the Board of Directors) or a member of the board of directors of a Parent or a Subsidiary, in each case who is not an Employee. 


        (i)    "Employee" shall mean any individual who is a common-law employee of the Company, a Parent, a Subsidiary or
an Affiliate. 


        (j)    "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 


        (k)   "Exercise Price" shall mean, in the case of an Option, the amount for which one Share may be purchased upon exercise of
such Option, as specified in the applicable Stock Option Agreement. "Exercise Price," in the case of a SAR, shall mean an amount, as specified in the applicable SAR Agreement, which is subtracted from
the Fair Market Value of one Share in determining the amount payable upon exercise of such SAR. 



        (l)    "Fair Market Value" with respect to a Share, shall mean the market price of one Share, determined by the Committee as
follows: 



        (i)    If
the Stock was traded over-the-counter on the date in question but was not traded on The Nasdaq Stock Market, then the Fair Market Value shall
be equal to the last transaction price quoted for such date by the OTC Bulletin Board or, if not so quoted, shall be equal to the mean between the last reported representative bid and asked prices
quoted for such date by the principal automated inter-dealer quotation system on which the Stock is quoted or, if the Stock is not quoted on any such system, by the Pink Sheets LLC; 



        (ii)   If
the Stock was traded on The Nasdaq Stock Market, then the Fair Market Value shall be equal to the last reported sale price quoted for such date by The Nasdaq Stock
Market; 


        (iii)  If
the Stock was traded on a United States stock exchange on the date in question, then the Fair Market Value shall be equal to the closing price reported for such
date by the applicable composite-transactions report; and 


        (iv)  If
none of the foregoing provisions is applicable, then the Fair Market Value shall be determined by the Committee in good faith on such basis as it deems appropriate. 




In
all cases, the determination of Fair Market Value by the Committee shall be conclusive and binding on all persons. 


        (m)  "ISO" shall mean an employee incentive stock option described in Section 422 of the Code. 


        (n)   "Nonstatutory Option" or "NSO" shall mean an employee stock option that
is not an ISO. 


        (o)   "Offeree" shall mean an individual to whom the Committee has offered the right to acquire Shares under the Plan (other
than upon exercise of an Option). 


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        (p)   "Option" shall mean an ISO or Nonstatutory Option granted under the Plan and entitling the holder to purchase Shares. 


        (q)   "Optionee" shall mean an individual or estate who holds an Option or SAR. 


        (r)    "Outside Director" shall mean a member of the Board of Directors who is not a common-law employee of, or paid
consultant to, the Company, a Parent or a Subsidiary. 


        (s)   "Parent" shall mean any corporation (other than the Company) in an unbroken chain of corporations ending with the
Company, if each of the corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.
A corporation that attains the status of a Parent on a date after the adoption of the Plan shall be a Parent commencing as of such date. 


        (t)    "Participant" shall mean an individual or estate who holds an Award. 



        (u)   "Plan" shall mean this 2006 Stock Incentive Plan of Techwell, Inc., as amended from time to time. 


        (v)   "Purchase Price" shall mean the consideration for which one Share may be acquired under the Plan (other than upon
exercise of an Option), as specified by the Committee. 


        (w)  "Restricted Share" shall mean a Share awarded under the Plan. 



        (x)   "Restricted Share Agreement" shall mean the agreement between the Company and the recipient of a Restricted Share which
contains the terms, conditions and restrictions pertaining to such Restricted Shares. 


        (y)   "SAR" shall mean a stock appreciation right granted under the Plan. 


        (z)   "SAR Agreement" shall mean the agreement between the Company and an Optionee which contains the terms, conditions and
restrictions pertaining to his or her SAR. 


        (aa) "Service" shall mean service as an Employee, Consultant or Outside Director, subject to such further limitations as may
be set forth in the Plan or the applicable Stock Option Agreement, SAR Agreement, Restricted Share Agreement or Stock Unit Agreement. Service does not terminate when an Employee goes 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, for purposes of determining whether an Option is entitled to ISO status, an Employee's employment will be treated as terminating 90 days after such Employee went on leave, unless such
Employee's right to return to active work is guaranteed by law or by a contract. Service terminates in any event when the approved leave ends, unless such Employee immediately returns to active work.
The Company determines which leaves count toward Service, and when Service terminates for all purposes under the Plan. 


        (bb) "Share" shall mean one share of Stock, as adjusted in accordance with Section 8 (if applicable). 


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        (cc) "Stock" shall mean the Common Stock of the Company. 


        (dd) "Stock Option Agreement" shall mean the agreement between the Company and an Optionee that contains the terms,
conditions and restrictions pertaining to his Option. 


        (ee) "Stock Unit" shall mean a bookkeeping entry representing the equivalent of one Share, as awarded under the Plan. 


        (ff)   "Stock Unit Agreement" shall mean the agreement between the Company and the recipient of a Stock Unit which contains the
terms, conditions and restrictions pertaining to such Stock Unit. 


        (gg) "Subsidiary" shall mean any corporation, if the Company and/or one or more other Subsidiaries own not less than 50% of
the total combined voting power of all classes of outstanding stock of such corporation. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be
considered a Subsidiary commencing as of such date. 


        (hh) "Total and Permanent Disability" shall mean permanent and total disability as defined by section 22(e)(3) of the
Code. 


SECTION 3.    ADMINISTRATION.  


        (a)   Committee Composition. The Plan shall be administered by the Committee. The Committee shall consist of two or more
directors of the Company, who shall be appointed by the Board. In addition, the composition of the Committee shall satisfy (i) such requirements as the Securities and Exchange Commission may
establish for administrators acting under plans intended to qualify for exemption under Rule 16b-3 (or its successor) under the Exchange Act; and (ii) such requirements as
the Internal Revenue Service may establish for outside directors acting under plans intended to qualify for exemption under Section 162(m)(4)(C) of the Code. 


        (b)   Committee for Non-Officer Grants. The Board may also appoint one or more separate committees of the Board,
each composed of one or more directors of the Company who need not satisfy the requirements of Section 3(a), who may administer the Plan with respect to Employees who are not considered
officers or directors of the Company under Section 16 of the Exchange Act, may grant Awards under the Plan to such Employees and may determine all terms of such grants. Within the limitations
of the preceding sentence, any reference in the Plan to the Committee shall include such committee or committees appointed pursuant to the preceding sentence. The Board of Directors may also authorize
one or more officers of the Company to designate Employees, other than officers under Section 16 of the Exchange Act, to receive Awards and/or to determine the number of such Awards to be
received by such persons; provided, however, that the Board of Directors shall specify the total number of Awards that such officers may so award. 


        (c)   Committee Procedures. The Board of Directors shall designate one of the members of the Committee as chairman. The
Committee may hold meetings at such times and places as it shall determine. The acts of a majority of the Committee members present at 


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meetings
at which a quorum exists, or acts reduced to or approved in writing by all Committee members, shall be valid acts of the Committee. 



        (d)   Committee Responsibilities. Subject to the provisions of the Plan, the Committee shall have full authority and discretion
to take the following actions: 



        (i)    To
interpret the Plan and to apply its provisions; 


        (ii)   To
adopt, amend or rescind rules, procedures and forms relating to the Plan; 


        (iii)  To
adopt, amend or terminate sub-plans established for the purpose of satisfying applicable foreign laws including qualifying for preferred tax treatment
under applicable foreign tax laws; 


        (iv)  To
authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan; 


        (v)   To
determine when Awards are to be granted under the Plan; 


        (vi)  To
select the Offerees and Optionees; 


        (vii) To
determine the number of Shares to be made subject to each Award; 


        (viii) To
prescribe the terms and conditions of each Award, including (without limitation) the Exercise Price and Purchase Price, and the vesting or duration of the Award
(including accelerating the vesting of Awards, either at the time of the Award or thereafter, without the consent of the Participant), to determine whether an Option is to be classified as an ISO or
as a Nonstatutory Option, and to specify the provisions of the agreement relating to such Award; 


        (ix)  To
amend any outstanding Award agreement, subject to applicable legal restrictions and to the consent of the Participant if the Participant's rights or obligations
would be materially impaired; 


        (x)   To
prescribe the consideration for the grant of each Award or other right under the Plan and to determine the sufficiency of such consideration; 



        (xi)  To
determine the disposition of each Award or other right under the Plan in the event of a Participant's divorce or dissolution of marriage; 


        (xii) To
determine whether Awards under the Plan will be granted in replacement of other grants under an incentive or other compensation plan of an acquired business; 


        (xiii) To
correct any defect, supply any omission, or reconcile any inconsistency in the Plan or any Award agreement; 



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        (xiv) To
establish or verify the extent of satisfaction of any performance goals or other conditions applicable to the grant, issuance, exercisability, vesting and/or
ability to retain any Award; and 


        (xv) To
take any other actions deemed necessary or advisable for the administration of the Plan. 




Subject
to the requirements of applicable law, the Committee may designate persons other than members of the Committee to carry out its responsibilities and may prescribe such conditions and
limitations as it may deem appropriate, except that the Committee may not delegate its authority with regard to the selection for participation of or the granting of Options or other rights under the
Plan to persons subject to Section 16 of the Exchange Act. All decisions, interpretations and other actions of the Committee shall be final and binding on all Offerees, all Optionees, and all
persons deriving their rights from an Offeree or Optionee. No member of the Committee shall be liable for any action that he has taken or has failed to take in good faith with respect to the Plan, any
Option, or any right to acquire Shares under the Plan. 


SECTION 4.    ELIGIBILITY.  


        (a)   General Rule. Only common-law employees of the Company, a Parent or a Subsidiary shall be eligible for the
grant of ISOs. Only Employees, Consultants and Outside Directors shall be eligible for the grant of Restricted Shares, Stock Units, Nonstatutory Options or SARs. 


        (b)   Automatic Grants to Outside Directors. 



        (i)    Each
Outside Director who first joins the Board of Directors on or after the Effective Date, and who was not previously an Employee, shall receive a Nonstatutory Option,
subject to approval of the Plan by the Company's stockholders, to purchase 20,000 Shares (subject to adjustment under Section 11) on the date of his or her election to the Board of Directors.
Twenty-five percent (25%) of the Shares subject to each Option granted under this Section 4(b)(i) shall vest and become exercisable on the first anniversary of the date of
grant. The balance of the Shares subject to such Option (i.e. the remaining seventy-five percent (75%)) shall vest and become exercisable monthly over a 3-year period beginning
on the day which is one month after the first anniversary of the date of grant, at a monthly rate of 2.0833% of the total number of Shares subject to such Option. Notwithstanding the foregoing, each
such Option shall become vested if a Change in Control occurs with respect to the Company during the Optionee's Service. 


        (ii)   On
the first business day following the conclusion of each regular annual meeting of the Company's stockholders, commencing with the annual meeting occurring after the
Effective Date, each Outside Director who was not elected to the Board for the first time at such meeting and who will continue serving as a member of the Board of Directors thereafter shall receive
an Option to purchase 10,000
Shares (subject to adjustment under Section 11), provided that such Outside Director has served on the Board of Directors for at least six months. Each Option granted under this
Section 4(b)(ii) 



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shall
vest and become exercisable on the first anniversary of the date of grant; provided, however, that each such Option shall become exercisable in full immediately prior to the next regular annual
meeting of the Company's stockholders following such date of grant in the event such meeting occurs prior to such first anniversary date. Notwithstanding the foregoing, each Option granted under this
Section 4(b)(ii) shall become vested if a Change in Control occurs with respect to the Company during the Optionee's Service. 


        (iii)  The
Exercise Price of all Nonstatutory Options granted to an Outside Director under this Section 4(b) shall be equal to 100% of the Fair Market Value of a Share
on the date of grant, payable in one of the forms described in Section 8(a), (b) or (d). 


        (iv)  All
Nonstatutory Options granted to an Outside Director under this Section 4(b) shall terminate on the earlier of (A) the day before the tenth anniversary
of the date of grant of such Options or (B) the date twelve months after the termination of such Outside Director's Service for any reason; provided, however, that any such Options that are not
vested upon the termination of the Outside Director's Service as a member of the Board of Directors for any reason shall terminate immediately and may not be exercised. 




        (c)   Ten-Percent Stockholders. An Employee who owns more than 10% of the total combined voting power of all
classes of outstanding stock of the Company, a Parent or Subsidiary shall not be eligible for the grant of an ISO unless such grant satisfies the requirements of Section 422(c)(5) of the Code. 



        (d)   Attribution Rules. For purposes of Section 4(c) above, in determining stock ownership, an Employee shall be deemed
to own the stock owned, directly or indirectly, by or for such Employee's brothers, sisters, spouse, ancestors and lineal descendants. Stock owned, directly or indirectly, by or for a corporation,
partnership, estate or trust shall be deemed to be owned proportionately by or for its stockholders, partners or beneficiaries. 


        (e)   Outstanding Stock. For purposes of Section 4(c) above, "outstanding stock" shall include all stock actually issued
and outstanding immediately after the grant. "Outstanding stock" shall not include shares authorized for issuance under outstanding options held by the Employee or by any other person. 


SECTION 5.    STOCK SUBJECT TO PLAN.  


        (a)   Basic Limitation. Shares offered under the Plan shall be authorized but unissued Shares or treasury Shares. The aggregate
number of Shares authorized for issuance as Awards under the Plan shall not exceed 1,990,000 Shares, plus (x) any Shares subject to outstanding options under the Company's 1997 Stock Option
Plan and 2001 Stock Option Plan (the "Predecessor Plans") on the effective date of this Plan that are subsequently forfeited or terminated for any other reason before being exercised and unvested
shares that are forfeited pursuant to the Company's Predecessor Plans after the effective date of this Plan, such number of additional Shares not to exceed an aggregate of 1,000,000 Shares, and
(y) an annual increase on the first day of each fiscal year during the term of the Plan, beginning January 1, 2007, in an 


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amount
equal to the lesser of (i) 1,750,000 Shares, (ii) 4% of the outstanding Shares on the last day of the immediately preceding year or (iii) an amount determined by the Board.
The limitations of this Section 5(a) shall be subject to adjustment pursuant to Section 11. The number of Shares that are subject to Options or other Awards outstanding at any time under
the Plan shall not exceed the number of Shares which then remain available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available
sufficient Shares to satisfy the requirements of the Plan. 


        (b)   Award Limitation. Subject to the provisions of Section 11, no Participant may receive Options, SARs, Restricted
Shares or Stock Units under the Plan in any calendar year that relate to more than 1,000,000 Shares. 


        (c)   Additional Shares. If Restricted Shares or Shares issued upon the exercise of Options are forfeited, then such Shares
shall again become available for Awards under the Plan. If Stock Units, Options or SARs are forfeited or terminate for any other reason before being exercised, then the corresponding Shares shall
again become available for Awards under the Plan. If Stock Units are settled, then only the number of Shares (if any) actually issued in settlement of such Stock Units shall reduce the number
available under Section 5(a) and the balance shall again become available for Awards under the Plan. If SARs are exercised, then only the number of Shares (if any) actually issued in settlement
of such SARs shall reduce the number available in Section 5(a) and the balance shall again become available for Awards under the Plan. 


SECTION 6.    RESTRICTED SHARES.  


        (a)   Restricted Stock Agreement. Each grant of Restricted Shares under the Plan shall be evidenced by a Restricted Stock
Agreement between the recipient and the Company. Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the
Plan. The provisions of the various Restricted Stock Agreements entered into under the Plan need not be identical. 


        (b)   Payment for Awards. Subject to the following sentence, Restricted Shares may be sold or awarded under the Plan for such
consideration as the Committee may determine, including (without limitation) cash, cash equivalents, full-recourse promissory notes, past services and future services. 



        (c)   Vesting. Each Award of Restricted Shares may or may not be subject to vesting. Vesting shall occur, in full or in
installments, upon satisfaction of the conditions specified in the Restricted Stock Agreement. A Restricted Stock Agreement may provide for accelerated vesting in the event of the Participant's death,
disability or retirement or other events. The Committee may determine, at the time of granting Restricted Shares of thereafter, that all or part of such Restricted Shares shall become vested in the
event that a Change in Control occurs with respect to the Company. 


        (d)   Voting and Dividend Rights. The holders of Restricted Shares awarded under the Plan shall have the same voting, dividend
and other rights as the Company's other stockholders. A Restricted Stock Agreement, however, may require that the holders of Restricted Shares invest 


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any
cash dividends received in additional Restricted Shares. Such additional Restricted Shares shall be subject to the same conditions and restrictions as the Award with respect to which the dividends
were paid. 


        (e)   Restrictions on Transfer of Shares. Restricted Shares shall be subject to such rights of repurchase, rights of first
refusal or other restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Restricted Stock Agreement and shall apply in addition to any general restrictions
that may apply to all holders of Shares. 


SECTION 7.    TERMS AND CONDITIONS OF OPTIONS.  


        (a)   Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the
Optionee and the Company. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent with the Plan
and which the Committee deems appropriate for inclusion in a Stock Option Agreement. The Stock Option Agreement shall specify whether the Option is an ISO or an NSO. The provisions of the various
Stock Option Agreements entered into under the Plan need not be identical. Options may be granted in consideration of a reduction in the Optionee's other compensation. 


        (b)   Number of Shares. Each Stock Option Agreement shall specify the number of Shares that are subject to the Option and shall
provide for the adjustment of such number in accordance with Section 11. 


        (c)   Exercise Price. Each Stock Option Agreement shall specify the Exercise Price. The Exercise Price of an ISO shall not be
less than 100% of the Fair Market Value of a Share on the date of grant, except as otherwise provided in 4(c), and the Exercise Price of an NSO shall not be less 85% of the Fair Market Value of a
Share on the date of grant. Subject to the foregoing in this Section 7(c), the Exercise Price under any Option shall be determined by the Committee at its sole discretion. The Exercise Price
shall be payable in one of the forms described in Section 8. 


        (d)   Withholding Taxes. As a condition to the exercise of an Option, the Optionee shall make such arrangements as the
Committee may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such exercise. The Optionee shall also make such
arrangements as the Committee may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with the disposition of Shares acquired
by exercising an Option. 


        (e)   Exercisability and Term. Each Stock Option Agreement shall specify the date when all or any installment of the Option is
to become exercisable. The Stock Option Agreement shall also specify the term of the Option; provided that the term of an ISO shall in no event exceed 10 years from the date of grant (five
years for Employees described in Section 4(c)). A Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee's death, disability, or retirement or other
events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee's Service. Options may be awarded in combination with SARs, and such an Award may
provide that the Options will not be 


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exercisable
unless the related SARs are forfeited. Subject to the foregoing in this Section 7(e), the Committee at its sole discretion shall determine when all or any installment of an Option
is to become exercisable and when an Option is to expire. 



        (f)    Exercise of Options. Each Stock Option Agreement shall set forth the extent to which the Optionee shall have the right to
exercise the Option following termination of the Optionee's Service with the Company and its Subsidiaries, and the right to exercise the Option of any executors or administrators of the Optionee's
estate or any person who has acquired such Option(s) directly from the Optionee by bequest or inheritance. Such provisions shall be determined in the sole discretion of the Committee, need not be
uniform among all Options issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination of Service. 



        (g)   Effect of Change in Control. The Committee may determine, at the time of granting an Option or thereafter, that such
Option shall become exercisable as to all or part of the Shares subject to such Option in the event that a Change in Control occurs with respect to the Company. 


        (h)   No Rights as a Stockholder. An Optionee, or a transferee of an Optionee, shall have no rights as a stockholder with
respect to any Shares covered by his Option until the date of the issuance of a stock certificate for such Shares. No adjustments shall be made, except as provided in Section 11. 



        (i)    Modification, Extension and Renewal of Options. Within the limitations of the Plan, the Committee may modify, extend or
renew outstanding options or may accept the cancellation of outstanding options (to the extent not previously exercised), whether or not granted hereunder, in return for the grant of new Options for
the same or a different number of Shares and at the same or a different exercise price, or in return for the grant of the same or a different number of Shares. The foregoing notwithstanding, no
modification of an Option shall, without the consent of the Optionee, materially impair his or her rights or obligations under such Option. 



        (j)    Restrictions on Transfer of Shares. Any Shares issued upon exercise of an Option shall be subject to such special
forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Stock Option
Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares. 


        (k)   Buyout Provisions. The Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents an
Option previously granted or (b) authorize an Optionee to elect to cash out an Option previously granted, in either case at such time and based upon such terms and conditions as the Committee
shall establish. 


SECTION 8.    PAYMENT FOR SHARES.  


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        (a)   General Rule. The entire Exercise Price or Purchase Price of Shares issued under the Plan shall be payable in lawful
money of the United States of America at the time when such Shares are purchased, except as provided in Section 8(b) through Section 8(g) below. 


        (b)   Surrender of Stock. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by
surrendering, or attesting to the ownership of, Shares which have already been owned by the Optionee or his representative. Such Shares shall be valued at their Fair Market Value on the date when the
new Shares are purchased under the Plan. The Optionee shall not surrender, or attest to the ownership of, Shares in payment of the Exercise Price if such action would cause the Company to recognize
compensation expense (or additional compensation expense) with respect to the Option for financial reporting purposes. 


        (c)   Services Rendered. At the discretion of the Committee, Shares may be awarded under the Plan in consideration of services
rendered to the Company or a Subsidiary prior to the award. If Shares are awarded without the payment of a Purchase Price in cash, the Committee shall make a determination (at the time of the award)
of the value of the services rendered by the Offeree and the sufficiency of the consideration to meet the requirements of Section 6(b). 



        (d)   Cashless Exercise. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by
delivery (on a form prescribed by the Committee) 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. 


        (e)   Exercise/Pledge. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by delivery
(on a form prescribed by the Committee) of an irrevocable direction to a securities broker or lender to pledge Shares, as security for a loan, and to deliver all or part of the loan proceeds to the
Company in payment of the aggregate Exercise Price. 


        (f)    Promissory Note. To the extent that a Stock Option Agreement or Restricted Stock Agreement so provides, payment may be
made all or in part by delivering (on a form prescribed by the Company) a full-recourse promissory note. 


        (g)   Other Forms of Payment. To the extent that a Stock Option Agreement or Restricted Stock Agreement so provides, payment
may be made in any other form that is consistent with applicable laws, regulations and rules. 


        (h)   Limitations under Applicable Law. Notwithstanding anything herein or in a Stock Option Agreement or Restricted Stock
Agreement to the contrary, payment may not be made in any form that is unlawful, as determined by the Committee in its sole discretion. 


SECTION 9.    STOCK APPRECIATION RIGHTS.  



        (a)   SAR Agreement. Each grant of a SAR under the Plan shall be evidenced by a SAR Agreement between the Optionee and the
Company. Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. 


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The
provisions of the various SAR Agreements entered into under the Plan need not be identical. SARs may be granted in consideration of a reduction in the Optionee's other compensation. 


        (b)   Number of Shares. Each SAR Agreement shall specify the number of Shares to which the SAR pertains and shall provide for
the adjustment of such number in accordance with Section 11. 


        (c)   Exercise Price. Each SAR Agreement shall specify the Exercise Price. A SAR Agreement may specify an Exercise Price that
varies in accordance with a predetermined formula while the SAR is outstanding. 



        (d)   Exercisability and Term. Each SAR Agreement shall specify the date when all or any installment of the SAR is to become
exercisable. The SAR Agreement shall also specify the term of the SAR. A SAR Agreement may provide for accelerated exercisability in the event of the Optionee's death, disability or retirement or
other events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee's service. SARs may be awarded in combination with Options, and such an Award
may provide that the SARs will not be exercisable unless the related Options are forfeited. A SAR may be included in an ISO only at the time of grant but may be included in an NSO at the time of grant
or thereafter. A SAR granted under the Plan may provide that it will be exercisable only in the event of a Change in Control. 



        (e)   Effect of Change in Control. The Committee may determine, at the time of granting a SAR or thereafter, that such SAR
shall become fully exercisable as to all Common Shares subject to such SAR in the event that a Change in Control occurs with respect to the Company. 


        (f)    Exercise of SARs. Upon exercise of a SAR, the Optionee (or any person having the right to exercise the SAR after his or
her death) shall receive from the Company (a) Shares, (b) cash or (c) a combination of Shares and cash, as the Committee shall determine. The amount of cash and/or the Fair Market
Value of Shares received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of the Shares subject to the SARs exceeds the
Exercise Price. 


        (g)   Modification or Assumption of SARs. Within the limitations of the Plan, the Committee may modify, extend or assume
outstanding SARs or may accept the cancellation of outstanding SARs (whether granted by the Company or by another issuer) in return for the grant of new SARs for the same or a different number of
shares and at the same or a different exercise price. The foregoing notwithstanding, no modification of a SAR shall, without the consent of the holder, materially impair his or her rights or
obligations under such SAR. 


        (h)   Buyout Provisions. The Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents a
SAR previously granted, or (b) authorize an Optionee to elect to cash out a SAR previously granted, in either case at such time and based upon such terms and conditions as the Committee shall
establish. 


SECTION 10.    STOCK UNITS.  


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        (a)   Stock Unit Agreement. Each grant of Stock Units under the Plan shall be evidenced by a Stock Unit Agreement between the
recipient and the Company. Such Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the
various Stock Unit Agreements entered into under the Plan need not be identical. Stock Units may be granted in consideration of a reduction in the recipient's other compensation. 



        (b)   Payment for Awards. To the extent that an Award is granted in the form of Stock Units, no cash consideration shall be
required of the Award recipients. 


        (c)   Vesting Conditions. Each Award of Stock Units may or may not be subject to vesting. Vesting shall occur, in full or in
installments, upon satisfaction of the conditions specified in the Stock Unit Agreement. A Stock Unit Agreement may provide for accelerated vesting in the event of the Participant's death, disability
or retirement or other events. The Committee may determine, at the time of granting Stock Units or thereafter, that all or part of such Stock Units shall become vested in the event that a Change in
Control occurs with respect to the Company. 


        (d)   Voting and Dividend Rights. The holders of Stock Units shall have no voting rights. Prior to settlement or forfeiture,
any Stock Unit awarded under the Plan may, at the Committee's discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash
dividends paid on one Share while the Stock Unit is outstanding. Dividend equivalents may be converted into additional Stock Units. Settlement of dividend equivalents may be made in the form of cash,
in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions (including without
limitation, any forfeiture conditions) as the Stock Units to which they attach. 


        (e)   Form and Time of Settlement of Stock Units. Settlement of vested Stock Units may be made in the form of (a) cash,
(b) Shares or (c) any combination of both, as determined by the Committee. The actual number of Stock Units eligible for settlement may be larger or smaller than the number included in
the original Award, based on predetermined performance factors. Methods of converting Stock Units into cash may include (without limitation) a method based on the average Fair Market Value of Shares
over a series of trading days. Vested Stock Units may be settled in a lump sum or in installments. The distribution may occur or commence when all vesting conditions applicable to the Stock Units have
been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Stock
Units is settled, the number of such Stock Units shall be subject to adjustment pursuant to Section 11. 


        (f)    Death of Recipient. Any Stock Units Award that becomes payable after the recipient's death shall be distributed to the
recipient's beneficiary or beneficiaries. Each recipient of a Stock Units Award under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the
Company. A beneficiary designation may be changed by filing the prescribed form with the Company at any time before the Award recipient's death. If no beneficiary was designated or if no designated
beneficiary survives the Award recipient, then 


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any
Stock Units Award that becomes payable after the recipient's death shall be distributed to the recipient's estate. 



        (g)   Creditors' Rights. A holder of Stock Units shall have no rights other than those of a general creditor of the Company.
Stock Units represent an unfunded and unsecured obligation of the Company, subject to the terms and conditions of the applicable Stock Unit Agreement. 


SECTION 11.    ADJUSTMENT OF SHARES.  


        (a)   Adjustments. In the event of a subdivision of the outstanding Stock, a declaration of a dividend payable in Shares, a
declaration of a dividend payable in a form other than Shares in an amount that has a material effect on the price of Shares, a combination or consolidation of the outstanding Stock (by
reclassification or otherwise) into a lesser number of Shares, a recapitalization, a spin-off or a similar occurrence, the Committee shall make such adjustments as it, in its sole
discretion, deems appropriate in one or more of: 



        (i)    The
number of Options, SARs, Restricted Shares and Stock Units available for future Awards under Section 5; 



        (ii)   The
limitations set forth in Sections 5(a) and (b); 


        (iii)  The
number of NSOs to be granted to Outside Directors under Section 4(b); 


        (iv)  The
number of Shares covered by each outstanding Option and SAR; 


        (v)   The
Exercise Price under each outstanding Option and SAR; or 


        (vi)  The
number of Stock Units included in any prior Award which has not yet been settled. 




Except
as provided in this Section 11, a Participant shall have no rights by reason of any issue by the Company of stock of any class or securities convertible into stock of any class, any
subdivision or consolidation of shares of stock of any class, the payment of any stock dividend or any other increase or decrease in the number of shares of stock of any class. 


        (b)   Dissolution or Liquidation. To the extent not previously exercised or settled, Options, SARs and Stock Units shall
terminate immediately prior to the dissolution or liquidation of the Company. 



        (c)   Reorganizations. In the event that the Company is a party to a merger or other reorganization, outstanding Awards shall
be subject to the agreement of merger or reorganization. Such agreement shall provide for: 



        (i)    The
continuation of the outstanding Awards by the Company, if the Company is a surviving corporation; 



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        (ii)   The
assumption of the outstanding Awards by the surviving corporation or its parent or subsidiary; 


        (iii)  The
substitution by the surviving corporation or its parent or subsidiary of its own awards for the outstanding Awards; 


        (iv)  Full
exercisability or vesting and accelerated expiration of the outstanding Awards; or 


        (v)   Settlement
of the full value of the outstanding Awards in cash or cash equivalents followed by cancellation of such Awards. 




        (d)   Reservation of Rights. Except as provided in this Section 11, an Optionee or Offeree shall have no rights by
reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend or any other increase or decrease in the number of shares of stock of any class. Any issue by
the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the
number or Exercise Price of Shares subject to an Option. The grant of an Option pursuant to the Plan shall not affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets. 


SECTION 12.    DEFERRAL OF AWARDS.  


        (a)   Committee Powers. The Committee (in its sole discretion) may permit or require a Participant to: 



        (i)    Have
cash that otherwise would be paid to such Participant as a result of the exercise of a SAR or the settlement of Stock Units credited to a deferred compensation
account established for such Participant by the Committee as an entry on the Company's books; 


        (ii)   Have
Shares that otherwise would be delivered to such Participant as a result of the exercise of an Option or SAR converted into an equal number of Stock Units; or 


        (iii)  Have
Shares that otherwise would be delivered to such Participant as a result of the exercise of an Option or SAR or the settlement of Stock Units converted into
amounts credited to a deferred compensation account established for such Participant by the Committee as an entry on the Company's books. Such amounts shall be determined by reference to the Fair
Market Value of such Shares as of the date when they otherwise would have been delivered to such Participant. 




        (b)   General Rules. A deferred compensation account established under this Section 12 may be credited with interest or
other forms of investment return, as determined by the Committee. A Participant for whom such an account is established shall have no rights other than those of a general creditor of the Company. Such
an account shall represent an unfunded and 


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unsecured
obligation of the Company and shall be subject to the terms and conditions of the applicable agreement between such Participant and the Company. If the deferral or conversion of Awards is
permitted or required, the Committee (in its sole discretion) may establish rules, procedures and forms pertaining to such Awards, including (without limitation) the settlement of deferred
compensation accounts established under this Section 12. 


SECTION 13.    AWARDS UNDER OTHER PLANS.  


        The Company may grant awards under other plans or programs. Such awards may be settled in the form of Shares issued under this Plan. Such Shares shall be treated
for all purposes under the Plan like Shares issued in settlement of Stock Units and shall, when issued, reduce the number of Shares available under Section 5. 



SECTION 14.    PAYMENT OF DIRECTOR'S FEES IN SECURITIES.  


        (a)   Effective Date. No provision of this Section 14 shall be effective unless and until the Board has determined to
implement such provision. 


        (b)   Elections to Receive NSOs, Restricted Shares or Stock Units. An Outside Director may elect to receive his or her annual
retainer payments and/or meeting fees from the Company in the form of cash, NSOs, Restricted Shares or Stock Units, or a combination thereof, as determined by the Board. Such NSOs, Restricted Shares
and Stock Units shall be issued under the Plan. An election under this Section 14 shall be filed with the Company on the prescribed form. 


        (c)   Number and Terms of NSOs, Restricted Shares or Stock Units. The number of NSOs, Restricted Shares or Stock Units to be
granted to Outside Directors in lieu of annual retainers and meeting fees that would otherwise be paid in cash shall be calculated in a manner determined by the Board. The terms of such NSOs,
Restricted Shares or Stock Units shall also be determined by the Board. 



SECTION 15.    LEGAL AND REGULATORY REQUIREMENTS.  


        Shares shall not be issued under the Plan unless the issuance and delivery of such Shares complies with (or is exempt from) all applicable requirements of law,
including (without limitation) the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder, state securities laws and regulations and the regulations of any stock exchange
on which the Company's securities may then be listed, and the Company has obtained the approval or favorable ruling from any governmental agency which the Company determines is necessary or advisable.
The Company shall not be liable to a Participant or other persons as to: (a) the non-issuance or sale of Shares as to which the Company has been unable to obtain from any regulatory
body having jurisdiction the authority deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Shares under the Plan; and (b) any tax consequences expected, but
not realized, by any Participant or other person due to the receipt, exercise or settlement of any Award granted under the Plan. 


SECTION 16.    WITHHOLDING TAXES.  


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        (a)   General. To the extent required by applicable federal, state, local or foreign law, a Participant or his or her successor
shall make arrangements satisfactory to the Company for the satisfaction of any withholding tax obligations that arise in connection with the Plan. The Company shall not be required to issue any
Shares or make any cash payment under the Plan until such obligations are satisfied. 


        (b)   Share Withholding. The Committee may permit a Participant to satisfy all or part of his or her withholding or income tax
obligations by having the Company withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously
acquired. Such Shares shall be valued at their Fair Market Value on the date when taxes otherwise would be withheld in cash. In no event may a Participant have Shares withheld that would otherwise be
issued to him or her in excess of the number necessary to satisfy the legally required minimum tax withholding. 


SECTION 17.    OTHER PROVISIONS APPLICABLE TO AWARDS.  



        (a)   Transferability. Unless the agreement evidencing an Award (or an amendment thereto authorized by the Committee) expressly
provides otherwise, no Award granted under this Plan, nor any interest in such Award, may be sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner (prior to
the vesting and lapse of any and all restrictions applicable to Shares issued under such Award), other than by will or the laws of descent and distribution; provided, however, that an ISO may be
transferred or assigned only to the extent consistent with Section 422 of the Code. Any purported assignment, transfer or encumbrance in violation of this Section 17(a) shall be void and
unenforceable against the Company. 


        (b)   Qualifying Performance Criteria. The number of Shares or other benefits granted, issued, retainable and/or vested under
an Award may be made subject to the attainment of performance goals for a specified period of time relating to one or more of the following performance criteria, either individually, alternatively or
in any combination, applied to either the Company as a whole or to a business unit or Subsidiary, either individually, alternatively or in any combination, and measured either annually or cumulatively
over a period of years, on an absolute basis or relative to a pre-established target, to previous years' results or to a designated comparison group or index, in each case as specified by
the Committee in the Award: (a) cash flow, (b) earnings per share, (c) earnings before interest, taxes and amortization, (d) return on equity, (e) total stockholder
return, (f) share price performance, (g) return on capital, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or
net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin, (n) return on operating revenue, (o) return on invested capital,
or (p) market segment shares ("Qualifying Performance Criteria"). The Committee may appropriately adjust any evaluation of performance under a Qualifying Performance Criteria to exclude any of
the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law,
accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary nonrecurring
items as described in Accounting Principles Board Opinion No. 30 and/or in managements' discussion and analysis of financial condition and results of operations appearing in the Company's
annual report to stockholders for 


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the
applicable year. If applicable, the Committee shall determine the Qualifying Performance Criteria not later than the 90th day of the performance period, and shall determine and
certify, for each Participant, the extent to which the Qualifying Performance Criteria have been met. The Committee may not in any event increase the amount of compensation payable under the Plan upon
the attainment of a Qualifying Performance Goal to a Participant who is a "covered employee" within the meaning of Section 162(m) of the Code. 


SECTION 18.    NO EMPLOYMENT RIGHTS.  


        No provision of the Plan, nor any right or Option granted under the Plan, shall be construed to give any person any right to become, to be treated as, or to
remain an Employee. The Company and its Subsidiaries reserve the right to terminate any person's Service at any time and for any reason, with or without notice. 


SECTION 19.    DURATION AND AMENDMENTS.  


        (a)   Term of the Plan. The Plan, as set forth herein, shall terminate automatically on November 17, 2015 and may be
terminated on any earlier date pursuant to Subsection (b) below. 



        (b)   Right to Amend or Terminate the Plan. The Board of Directors may amend the Plan at any time and from time to time. Rights
and obligations under any Award granted before amendment of the Plan shall not be materially impaired by such amendment, except with consent of the Participant. An amendment of the Plan shall be
subject to the approval of the Company's stockholders only to the extent required by applicable laws, regulations or rules. 


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        (c)   Effect of Termination. No Awards shall be granted under the Plan after the termination thereof. The termination of the
Plan shall not affect Awards previously granted under the Plan. 


[Remainder
of this page intentionally left blank] 


TECHWELL, INC.

2006 STOCK INCENTIVE PLAN

- 20 -







 

SECTION 20.    EXECUTION.  


        To record the adoption of the Plan by the Board of Directors, the Company has caused its authorized officer to execute the same. 



	 	 	TECHWELL, INC.

  
	

 	
 	

By	

  

	

 	
 	

Name	

  

	

 	
 	

Title	

  





TECHWELL, INC.

2006 STOCK INCENTIVE PLAN

- 21 -








  



 
 
 

TECHWELL, INC.    
    
    2006 STOCK INCENTIVE PLAN    
    
    NOTICE OF STOCK OPTION GRANT    
    



        You have been granted the following Option to purchase Common Stock of TECHWELL, INC. (the "Company") under the Company's 2006 Stock Incentive Plan (the
"Plan"): 



	Name of Optionee:	 	[Name of Optionee]
	

Total Number of Option Shares Granted:	
 	

[Total Number of Shares]
	

Type of Option:	
 	

o  Incentive Stock Option
	

 	
 	

o  Nonstatutory Stock Option
	

Exercise Price Per Share:	
 	

$                        
	

Grant Date:	
 	

[Date of Grant]
	

Vesting Commencement Date:	
 	

[Vesting Commencement Date]
	

Vesting Schedule:	
 	

This Option becomes exercisable with respect to the first 1/4th of the shares subject to this Option when you complete 12 months of continuous Service as an Employee or a Consultant from the Vesting Commencement Date. Thereafter, this
Option becomes exercisable with respect to an additional 1/48th of the shares subject to this Option when you complete each additional month of such Service
	

Expiration Date:	
 	

[Expiration Date] This Option expires earlier if your Service terminates earlier, as described in the Stock Option Agreement.





        By
your signature and the signature of the Company's representative below, you and the Company agree that this Option is granted under and governed by the term and conditions of the Plan
and the Stock Option Agreement, both of which are attached to and made a part of this document. 


        By
signing this document you further agree that the Company may deliver by e-mail all documents relating to the Plan or this award (including without limitation, prospectuses
required by the Securities and Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including without limitation, annual reports and proxy
statements). You also agree that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract with the Company. If the Company
posts these documents on a website, it will notify you by e-mail. 


TECHWELL, INC.

NOTICE OF STOCK OPTION GRANT

- 1 -







 


	OPTIONEE:

  	 	TECHWELL, INC.

  
	

  
 Optionee's Signature	
 	

By:	

  

	

  
 Optionee's Printed Name	
 	

Title:	

  





TECHWELL, INC.

NOTICE OF STOCK OPTION GRANT

- 2 -








  



 
 
 

TECHWELL, INC.    
    
    2006 STOCK INCENTIVE PLAN    
    
    STOCK OPTION AGREEMENT    
    



	Tax Treatment	 	This Option is intended to be an incentive stock option under Section 422 of the Internal Revenue Code or a nonstatutory option, as provided in the Notice of Stock Option Grant. Even if this Option is designated as an
incentive stock option, it shall be deemed to be a nonstatutory option to the extent required by the $100,000 annual limitation under Section 422(d) of the Internal Revenue Code.
	

Vesting	
 	

This Option becomes exercisable in installments, as shown in the Notice of Stock Option Grant. This Option will in no event become exercisable for additional shares after your Service as an Employee or a Consultant has terminated for any
reason.
	

Term	
 	

This Option expires in any event at the close of business at Company headquarters on the day before the 10th anniversary of the Grant Date, as shown on the Notice of Stock Option Grant (fifth anniversary for a more than 10% stockholder as provided
under the Plan if this is an incentive stock option). This Option may expire earlier if your Service terminates, as described below.
	

Regular

Termination	
 	

If your Service terminates for any reason except death or "Total and Permanent Disability" (as defined in the Plan), then this Option will expire at the close of business at Company headquarters on the date three (3) months after the date your
Service terminates (or, if earlier, the Expiration Date). The Company has discretion to determine when your Service terminates for all purposes of the Plan and its determinations are conclusive and binding on all persons.
	

Death	
 	

If your Service terminates because of death, then this Option will expire at the close of business at Company headquarters on the date 12 months after the date your Service terminates (or, if earlier, the Expiration Date). During that period of up to
12 months, your estate or heirs may exercise the Option.
	

Disability	
 	

If your Service terminates because of your Total and Permanent Disability, then this Option will expire at the close of business at Company headquarters on the date 12 months after the date your Service terminates (or, if earlier, the Expiration
Date).
	

Leaves of Absence	
 	

For purposes of this Option, your Service does not terminate when you go on a military leave, a sick leave or another bona fide leave of absence, if the leave was approved by the Company in writing and
if continued crediting of Service is required by the terms of the leave or by applicable law. But your Service terminates when the approved leave ends, unless
	 	 	 	 



TECHWELL, INC.

STOCK OPTION AGREEMENT

- 1 -







 

	

 	
 	

you immediately return to active work.
	

 	
 	

If you go on a leave of absence, then the vesting schedule specified in the Notice of Stock Option Grant may be adjusted in accordance with the Company's leave of absence policy or the terms of your leave. If you commence working on a part-time basis,
 then the vesting schedule specified in the Notice of Stock Option Grant may be adjusted in accordance with the Company's part-time work policy or the terms of an agreement between you and the Company pertaining to your part-time
schedule.
	

Restrictions on

Exercise	
 	

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 inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be
necessary to the lawful issuance and sale of the Company stock pursuant to this Option shall relieve the Company of any liability with respect to the non-issuance or sale of the Company stock as to which such approval shall not have been obtained.
However, the Company shall use its best efforts to obtain such approval.
	

Notice of Exercise	
 	

When you wish to exercise this Option you must notify the Company by completing the attached "Notice of Exercise of Stock Option" form and filing it with the Human Resources Department of the Company. Your notice must specify how many shares you wish
to purchase. Your notice must also specify how your shares should be registered. The notice will be effective when it is received by the Company. 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 Option exercise price for the shares you are purchasing. Payment may be made in the following form(s):
	

 	
 	

•	

Your personal check, a cashier's check or a money order.
	

 	
 	

•	

Certificates for shares of Company stock that you own, along with any forms needed to effect a transfer of those shares to the Company. The value of the shares, determined as of the effective date of the Option exercise, will be applied to the Option
exercise price. Instead of surrendering shares of Company stock, you may attest to the ownership of those shares on a form provided by the Company and have the same number of shares subtracted from the Option shares issued to you. However, you may
not surrender, or attest to the ownership of shares of Company stock in payment of the exercise price if your action would cause the Company to recognize a compensation expense (or additional compensation expense) with respect to this Option for
financial reporting purposes.
	

 	
 	

•	

By delivery on a form approved by the Committee of an irrevocable direction to a securities broker approved by the Company to sell all or
	 	 	 	 



TECHWELL, INC.

STOCK OPTION AGREEMENT

- 2 -







 

	

 	
 	

 	

part of your Option shares and to deliver to the Company from the sale proceeds an amount sufficient to pay the Option exercise price and any withholding taxes. The balance of the sale proceeds, if any, will be delivered to you. The directions must
be given by signing a special "Notice of Exercise" form provided by the Company.
	

 	
 	

•	

By delivery on a form approved by the Committee of an irrevocable direction to a securities broker or lender approved by the Company to pledge Option shares as security for a loan and to deliver to the Company from the loan proceeds an amount
sufficient to pay the Option exercise price and any withholding taxes. The directions must be given by signing a special "Notice of Exercise" form provided by the Company.
	

 	
 	

•	

Any other form permitted by the Committee in its sole discretion.
	

 	
 	

Notwithstanding the foregoing, payment may not be made in any form that is unlawful, as determined by the Committee in its sole discretion.
	

Withholding

Taxes and Stock

Withholding	
 	

You will not be allowed to exercise this Option unless you make arrangements acceptable to the Company to pay any withholding taxes that may be due as a result of the Option exercise. These arrangements may include withholding shares of Company stock
that otherwise would be issued to you when you exercise this Option. The value of these shares, determined as of the effective date of the Option exercise, will be applied to the withholding taxes.
	

Restrictions on

Resale	
 	

By signing this Agreement, you agree not to sell any Option shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as long as you are an employee,
consultant or director of the Company or a subsidiary of the Company.
	

Transfer of Option	
 	

In general, only you can exercise this Option prior to your death. You cannot transfer or assign this Option, other than as designated by you by will or by the laws of descent and distribution, except as provided below. 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 in any event 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 former spouse, nor is the Company obligated to recognize your former spouse's interest in your Option in any other way.
	

 	
 	

However, if this Option is designated as a nonstatutory stock option in the Notice of Stock Option Grant, then the Committee may, in its sole discretion, allow you to transfer this Option as a gift to one or more family members. For purposes of this
Agreement, "family member" means a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, or
	 	 	 	 



TECHWELL, INC.

STOCK OPTION AGREEMENT

- 3 -







 

	

 	
 	

sister-in-law (including adoptive relationships), any individual sharing your household (other than a tenant or employee), a trust in which one or more of these individuals have more than 50% of the beneficial interest, a foundation in which you or
one or more of these persons control the management of assets, and any entity in which you or one or more of these persons own more than 50% of the voting interest.
	

 	
 	

In addition, if this Option is designated as a nonstatutory stock option in the Notice of Stock Option Grant, then the Committee may, in its sole discretion, allow you to transfer this option to your spouse or former spouse pursuant to a domestic
relations order in settlement of marital property rights.
	

 	
 	

The Committee will allow you to transfer this Option only if both you and the transferee(s) execute the forms prescribed by the Committee, which include the consent of the transferee(s) to be bound by this Agreement.
	

Retention Rights	
 	

Neither your Option nor this Agreement gives you the right to be retained by the Company or a subsidiary of the Company in any capacity. The Company and its subsidiaries reserve the right to terminate your Service at any time, with or without
cause.
	

Stockholder

Rights	
 	

You, or your estate or heirs, have no rights as a stockholder of the Company until you have exercised this Option by giving the required notice to the Company and paying the exercise price. No adjustments are made for dividends or other rights if the
applicable record date occurs before you exercise this Option, except as described in the Plan.
	

Adjustments	
 	

In the event of a stock split, a stock dividend or a similar change in Company stock, the number of shares covered by this Option and the exercise price per share may be adjusted pursuant to the Plan.
	

Applicable Law	
 	

This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions).
	

The Plan and

Other Agreements	
 	

The text of the Plan is incorporated in this Agreement by reference. All capitalized terms in the Stock Option Agreement shall have the meanings assigned to them in the Plan. This Agreement and the Plan constitute the entire understanding between you
and the Company regarding this Option. Any prior agreements, commitments or negotiations concerning this Option are superseded. This Agreement may be amended only by another written agreement, signed by both parties.




BY SIGNING THE COVER SHEET OF THIS AGREEMENT,

YOU AGREE TO ALL OF THE TERMS AND CONDITIONS

DESCRIBED ABOVE AND IN THE PLAN.


TECHWELL, INC.

STOCK OPTION AGREEMENT

- 4 -








  



 
 
 

TECHWELL, INC.
  2006 STOCK INCENTIVE PLAN    
    
    NOTICE OF EXERCISE OF STOCK OPTION    
    


You must sign this Notice on the last page before submitting

it to the Company  


OPTIONEE INFORMATION:  



	 	 	 	Social Security	 
	Name:	  
	 	Number:	  

	

Address:	

  
	
 	

Employee Number:	

  






OPTION INFORMATION:  



	Date of Grant:                         ,
200    	 	Type of Stock Option:
	Exercise Price per Share: $                        	 	o    Nonstatutory (NSO)
	Total number of shares of Common Stock of

Techwell, Inc. (the "Company") covered by

option:                   	 	o    Incentive (ISO)





EXERCISE INFORMATION:  


Number
of shares of Common Stock of the Company for which option is being exercised now:                   . (These shares are referred to below as the
"Purchased Shares.") 


Total
exercise price for the Purchased Shares: $                         



Form
of payment enclosed [check all that apply]:


	o
	Check
for $                  , payable to "Techwell, Inc."



	o
	Certificate(s)
for                          shares of Common Stock of the Company that I have owned for at least
six months or have purchased in the open market. (These shares will be valued as of the date when the Company receives this notice.)



	o
	Attestation
Form covering                    shares of Common Stock of the Company. (These shares will be
valued as of the date when the Company receives this notice.) 


TECHWELL, INC.

NOTICE OF EXERCISE OF STOCK OPTION

- 1 -








 

Name(s) in which the Purchased Shares should be registered
 [please check one box]:



	o	In my name only	 
	

o	

In the names of my spouse and

myself as community property	

My spouse's name (if applicable):

  

	o	In the names of my spouse and

myself as joint tenants with the

right of survivorship	 
	

o	

In the name of an eligible

revocable trust	

Full legal name of revocable trust:

  
  
  

	

The certificate for the Purchased Shares

should be sent to the following address:	

  
  
  
  






ACKNOWLEDGMENTS:  


	1.
	I
understand that all sales of Purchased Shares are subject to compliance with the Company's policy on securities trades.



	2.
	I
hereby acknowledge that I received and read a copy of the prospectus describing the Company's 2006 Stock Incentive Plan and the tax consequences of an exercise.



	3.
	In
the case of a nonstatutory option, I understand that I must recognize ordinary income equal to the spread between the fair market value of the Purchased Shares on the date of
exercise and the exercise price. I further understand that I am required to pay withholding taxes at the time of exercising a nonstatutory option.



	4.
	In
the case of an incentive stock option, I agree to notify the Company if I dispose of the Purchased Shares before I have met both of the tax holding periods applicable to incentive
stock options (that is, if I make a disqualifying disposition).



	5.
	I
acknowledge that the Company has encouraged me to consult my own adviser to determine the form of ownership that is appropriate for me. In the event that I choose to transfer my
Purchased Shares to a trust that does not satisfy the requirements of the Internal Revenue Service (i.e., a trust that is not an eligible revocable trust), I also acknowledge that the transfer will be
treated as a "disposition" for incentive stock option tax purposes. As a result, the favorable incentive stock option tax treatment will be unavailable and other unfavorable tax consequences may
occur. 


TECHWELL, INC.

NOTICE OF EXERCISE OF STOCK OPTION

- 2 -







 

SIGNATURE AND DATE:  



	

  
	
 	

  
	
 	

  
	

, 200	

  
	
 	

 




TECHWELL, INC.

NOTICE OF EXERCISE OF STOCK OPTION

- 3 -








  



 
 
 

TECHWELL, INC.
  2006 STOCK INCENTIVE PLAN
  NOTICE OF RESTRICTED STOCK AWARD    
    



        You have been granted restricted shares of Common Stock of Techwell, Inc. (the "Company") on the following terms: 



	
Date of Grant:	
 	

[Date of Grant]
	
Name of Recipient:	
 	

[Name of Recipient]
	
Total Number of Shares Granted:	
 	

[Total Shares]
	
Fair Market Value per Share:	
 	

$[Value Per Share]
	
Total Fair Market Value Of Award:	
 	

$[Total Value]
	
Vesting Commencement Date:	
 	

[Vest Day]
	
Vesting Schedule:	
 	

The first [Cliff Percent]% of the shares subject to this award vest when you complete [Cliff Period] months of continuous Service as an Employee or a Consultant from the Vesting Commencement Date. Thereafter, an additional [Percent]% of the shares
subject to this award vest when you complete each month of Service.




TECHWELL, INC.

NOTICE OF RESTRICTED STOCK AWARD

- 1 -







 

        By signing this document, you and the Company agree that these shares are granted under and governed by the terms and conditions of the Techwell, Inc. 2006
Stock Incentive Plan (the "Plan") and the Restricted Stock Agreement, which is attached to and made a part of this document.



        By signing this document you further agree that the Company may deliver by e-mail all documents relating to the Plan or this award (including without
limitation, prospectuses required by the Securities and Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including without limitation,
annual reports and proxy statements). You also agree that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract with the
Company. If the Company posts these documents on a website, it will notify you by e-mail.



	[NAME OF RECIPIENT]	 	TECHWELL, INC.
	

 	
 	

By:	
 	

 
	
	 	 	 	

	

 	
 	

Title:	
 	

 
	 	 	 	 	





TECHWELL, INC.

NOTICE OF RESTRICTED STOCK AWARD

- 2 -








  



 
 
 

TECHWELL, INC.
  2006 STOCK INCENTIVE PLAN
  RESTRICTED STOCK AGREEMENT    
    


SECTION 1.    PAYMENT FOR SHARES.  


        No payment is required for the shares that you are receiving. 


SECTION 2.    GOVERNING PLAN.  


        The shares that you are receiving are granted pursuant and subject in all respects to the applicable provisions of the Techwell, Inc. 2006 Stock Incentive
Plan (the "Plan"), which is incorporated herein by reference. Terms not otherwise defined in this Agreement have meanings ascribed to them in the Plan. 


SECTION 3.    VESTING.  


        The shares that you are receiving will vest in installments, as shown in the Notice of Restricted Stock Award. 


        No
additional shares vest after your Service as an Employee or a Consultant has terminated for any reason. 



SECTION 4.    SHARES RESTRICTED.  


        Unvested shares will be considered "Restricted Shares." You may not sell, transfer, pledge or otherwise dispose of Restricted Shares without the written consent
of the Company, except as provided in the next sentence. You may transfer Restricted Shares to your spouse, children or grandchildren or to a trust established by you for the benefit of yourself or
your spouse, children or grandchildren. However, a transferee of Restricted Shares must agree in writing on a form prescribed by the Company to be bound by all provisions of this Agreement. 



SECTION 5.    FORFEITURE.  


        If your Service terminates for any reason, then your shares will be forfeited to the extent that they have not vested before the termination date and do not vest
as a result of termination. This means that the Restricted Shares will immediately revert to the Company. You receive no payment for Restricted Shares that are forfeited. The Company determines when
your Service terminates for this purpose. 


SECTION 6.    LEAVES OF ABSENCE AND PART-TIME WORK.  


        For purposes of this award, your Service does not terminate when you go on a military leave, a sick leave or another bona
fide leave of absence, if the leave was approved by the Company in writing and if continued crediting of Service is required by applicable law, 


TECHWELL, INC.

RESTRICTED STOCK AGREEMENT

- 1 -







 

the
Company's leave of absence policy or the terms of your leave. But your Service terminates when the approved leave ends, unless you immediately return to active work. 



        If
you go on a leave of absence, then the vesting schedule specified in the Notice of Restricted Stock Award may be adjusted in accordance with the Company's leave of absence policy or
the terms of your leave. If you commence working on a part-time basis, then the vesting schedule specified in the Notice of Restricted Stock Award may be adjusted in accordance with the
Company's
part-time work policy or the terms of an agreement between you and the Company pertaining to your part-time schedule. 


SECTION 7.    STOCK CERTIFICATES.  


        The certificates for Restricted Shares have stamped on them a special legend referring to the forfeiture restrictions. In addition to or in lieu of imposing the
legend, the Company may hold the certificates in escrow. As your vested percentage increases, you may request (at reasonable intervals) that the Company release to you a non-legended
certificate for your vested shares. 


SECTION 8.    SHAREHOLDER RIGHTS.  


        During the period of time between the date of grant and the date the shares become vested, you shall have all the rights of a shareholder with respect to the
shares except for the right to transfer the shares, as set forth in Section 4. Accordingly, you shall have the right to vote the shares and to receive any cash dividends paid with respect to
the shares. 



SECTION 9.    WITHHOLDING TAXES.  


        No stock certificates will be released to you unless you have made acceptable arrangements to pay withholding taxes that may be due as a result of this award or
the vesting of the shares. With the Company's consent, these arrangements may include (a) withholding shares of Company stock that otherwise would be delivered to you when they vest or
(b) surrendering shares that you previously acquired. The fair market value of the shares you surrender, determined as of the date when taxes otherwise would have been withheld in cash, will be
applied as credit against the withholding taxes. 


SECTION 10.    RESTRICTIONS ON RESALE.  



        You agree not to sell any shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This
restriction will apply as long as your Service continues and for such period of time after the termination of your Service as the Company may specify. 


SECTION 11.    NO RETENTION RIGHTS.  


TECHWELL, INC.

RESTRICTED STOCK AGREEMENT

- 2 -







 

Your
award or this Agreement does not give you the right to be employed or retained by the Company or a subsidiary of the Company in any capacity. The Company and its subsidiaries reserve the right to
terminate your Service at any time, with or without cause. 


SECTION 12.    ADJUSTMENTS.  


        In the event of a stock split, a stock dividend or a similar change in Company stock, or a merger or a reorganization of the Company, the forfeiture provision of
Section 5 will apply to all new, substitute or additional securities or other properties to which you are entitled by reason of your ownership of the shares. 


SECTION 13.    APPLICABLE LAW.  


        This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law
provisions). 


SECTION 14.    THE PLAN AND OTHER AGREEMENTS.  


        The text of this Plan is incorporated in this Agreement by reference. This Agreement and the Plan constitute the entire understanding between you and the Company
regarding this award. Any prior agreements, commitments or negotiations concerning this award are superseded. This Agreement may be amended only by another written agreement between the parties. 


SECTION 15.    SUCCESSORS AND ASSIGNS.  


        The rights and benefits of this Agreement shall inure to the benefit of, and be enforceable by, the Company's successors and assigns. Your rights and obligations
under this Agreement may only be assigned with the prior written consent of the Company. 



SECTION 16.    NOTICE.  


        Any notice required or permitted under this Agreement shall be given in writing and shall be deemed effectively given upon the earliest of personal delivery,
receipt or the third full day following deposit in the United States Post Office with postage and fees prepaid, addressed to the other party hereto at the address last known or at such other address
as such party may designate by ten (10) days' advance written notice to the other party hereto. 



SECTION 17.    NO ORAL MODIFICATION.  


        No modification of this Agreement shall be valid unless made in writing and signed by the parties hereto. 


TECHWELL, INC.

RESTRICTED STOCK AGREEMENT

- 3 -











QuickLinks



Exhibit 10.4


FORM OF TECHWELL, INC. 2006 STOCK INCENTIVE PLAN



NOTICE OF STOCK OPTION GRANT


STOCK OPTION AGREEMENT


NOTICE OF EXERCISE OF STOCK OPTION


NOTICE OF RESTRICTED STOCK AWARD


RESTRICTED STOCK AGREEMENT