Exhibit
10.21


 


II.            OPTION AGREEMENT


 


1.             Grant
of Option. The Company hereby grants to the optionee named in the attached
Notice of Grant (the “Optionee”), the Option to purchase the Shares, at the
exercise price per Share set forth in the Notice of Grant (the “Exercise Price”)
subject to the terms, definitions and provisions of the Marvell Technology
Group Ltd. Amended and Restated 1995 Stock Option Plan, as the same may be
amended as set forth therein and herein (the “Plan”), which is incorporated
herein by reference. Unless otherwise defined herein, the terms defined in the
Plan shall have the same defined meanings in this Option Agreement and the
Notice of Grant.


 


If
designated in the Notice of Grant as an Incentive Stock Option, this Option is
intended to qualify as an Incentive Stock Option as defined in Section 422
of the Code. However, if this Option is intended to be an Incentive Stock
Option, to the extent that it exceeds the $100,000 rule of Code
Section 422(d) it shall be treated as a Nonstatutory Stock Option.


 


2.             Exercise
of Option. This Option shall be exercisable during its term and shall vest
in accordance with the Vesting Schedule and with the provisions of
Section 9 of the Plan as follows:


 


(i)            Right
to Exercise.


 


(a)           This
Option may not be exercised for a fraction of a Share.


 


(b)           In
the event of Optionee’s death, disability or other termination of Optionee’s
Continuous Service, the exercisability of this Option shall be governed by
Sections 5, 6 and 7 below.


 


(c)           In
no event may this Option be exercised after the date of expiration of the term
of this Option as set forth in the Notice of Grant.


 


(ii)           Method
of Exercise.


 


(a)           This
Option shall be exercisable by written notice (in the form attached as
Exhibit A) which shall state the election to exercise this Option, the
number of Shares in respect of which this Option is being exercised, and such
other representations and agreements as to as may reasonably be required by the
Company. Such written notice shall be signed by Optionee and shall be delivered
in person or by certified mail to the Secretary of the Company. The written
notice shall be accompanied by payment of the aggregate Exercise Price for the
number of Shares in respect of which the Option is being exercised. This Option
shall be deemed to be exercised upon receipt by the Company of such written
notice accompanied by the aggregate Exercise Price for the number of Shares in
respect of which the Option is being exercised.


 


(b)           No
Shares will be issued pursuant to the exercise of an Option unless such
issuance and such exercise shall comply with all relevant provisions of law and
the requirements of any stock exchange or interdealer quotation system upon
which the Shares may then be listed or traded. Assuming such compliance, for
income tax purposes the Shares shall be considered transferred to Optionee on
the date on which this Option is exercised with respect to such Shares.


 

















 


(c)           If
this Option is being exercise by the representative of the Optionee, the
exercise notice shall be accompanied by proof (satisfactory to the Company) of
the representative’s right to exercise this Option.


 


3.             Payment.


 


(a)           Payment of
the Exercise Price shall be by any of the following, or a combination thereof,
at the election of Optionee: (i) cash, (ii) check, (iii) other Shares that have
a Fair Market Value on the date of payment equal to the aggregate exercise
price of the Shares as to which this Option is being exercised, provided that
at such time the Company is legally able to purchase its shares, or (iv)
delivery by a broker or brokerage firm approved by the Administrator of a
properly executed exercise notice together with payment of the Exercise Price
and such other documentation as the Administrator shall require.


 


(b)           Neither
the Optionee nor the Optionee’s representative shall have any rights as a
shareholder with respect to any Shares subject to this Option until the
Optionee or the Optionee’s representative becomes entitled to receive such
Shares by filing a notice of exercise and paying the aggregate Exercise Price
pursuant to Section 2.0 and Section 3(a).


 


4.             Restrictions
on Exercise. This Option may not be exercised until such time as the Plan
has been approved by the shareholders of the Company, or if the issuance of
such Shares upon such exercise or the method of payment of consideration for
such shares would constitute a violation of any applicable federal or state
securities or other law or regulation, including any rule under Part 207
of Title 12 of the Code of Federal Regulations (“Regulation G”) as
promulgated by the Federal Reserve Board. As a condition to the exercise of
this Option, the Company may require Optionee to make any representation and
warranty to the Company as may be required by any applicable law or regulation.


 


5.             Termination
of Relationship. In the event an Optionee’s Continuous Status as an
Employee or Consultant terminates, Optionee may, to the extent this Option was
vested at the date of such termination (the “Termination Date”), exercise this
Option at any time during the 30 day period immediately following the
Termination Date. To the extent that Optionee was not vested in this Option at
the date of such termination, or if Optionee does not exercise this Option
within the time specified herein, this Option shall terminate. Notwithstanding
the foregoing, in no event shall any Option be exercisable later than the
Term/Expiration Date as provided in the Notice of Grant.


 


6.             Disability
of Optionee. Notwithstanding the provisions of Section 5 above, in the
event of termination of an Optionee’s Continuous Status as an Employee or
Consultant as a result of his or her disability, Optionee may, but only within
the 180 day period (or such other period of time in excess of 180 days as is
determined by the Administrator in its absolute discretion) immediately
following the date of such termination, exercise this Option to the extent this
Option was vested at the date of such termination; provided, however, that if
such disability is not a “disability” as such term is defined in Section 22(e)(3)
of the Code, in the case of an Incentive Stock Option such Incentive Stock
Option shall cease to be treated as an Incentive Stock Option and shall be
treated for tax purposes as a Nonstatutory Stock Option on the ninety-first
(91st) day following such termination. To the extent that Optionee was not
vested in this Option at the date of termination, or


 

















 


if Optionee does not exercise this Option within the
time specified herein, this Option shall terminate, and the Shares covered by
this Option shall revert to the Plan. Notwithstanding the foregoing, in no
event shall any Option be exercisable later than the Expiration Date as
provided in the Notice of Grant.


 


7.             Death
of Optionee. Notwithstanding the provisions of Section 5 above, in the
event of termination of Optionee’s Continuous Status as an Employee or
Consultant as a result of the death of Optionee, this Option may be exercised
at any time within the 360 day period immediately following the date of death,
by Optionee’s estate or by a person who acquired the right to exercise this
Option by bequest or inheritance, but only to the extent Optionee could
exercise this Option at the date of death. Notwithstanding the foregoing, in no
event shall any Option be exercisable later than the Expiration Date as
provided in the Notice of Grant. To the extent that Optionee is not vested in
this Option at the date of death, or if this Option is not exercised within the
time specified herein, this Option shall terminate, and the Shares covered by
such Option shall revert to the Plan.


 


8.             Non-Transferability
of Option. This Option may not be transferred in any manner otherwise than
by will or by the laws of descent or distribution and may be exercised during
the lifetime of Optionee only by Optionee. The terms of this Option shall be
binding upon the executors, administrators, heirs, successors and assigns of
Optionee.


 


9.             Term
of Option. This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with
the Plan and the terms of this Option. The limitations set out in
Section 6 of the Plan regarding Options designated as Incentive Stock
Options that are granted to more than ten percent (10%) shareholders shall
apply to this Option. All expiration periods set forth in this Option Agreement
and the Plan shall terminate at 5:00 p.m. California time on the date provided
in this Option Agreement or the Plan.


 


10.           Tax
Consequences. Optionee acknowledges that he or she has read the description
of tax consequences in the Plan Prospectus and has consulted his or her
personal tax advisor regarding the same to the extent he or she has determined
advisable. Optionee is not relying on the Company, or any of its officers,
directors, employees or advisors, for any tax advice or planning information
whatsoever. Set forth below is a brief summary as of the date of this Option of
some of the federal and state tax consequences of exercise of this Option and
disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX
LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. OPTIONEE SHOULD CONSULT A TAX
ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.


 


(i)            Exercise
of Incentive Stock Option. If this Option qualifies as an Incentive Stock
Option, there will be no regular federal income tax liability or state income
tax liability upon the exercise of this Option, although the excess, if any, of
the Fair Market Value of the Shares on the date of exercise over the Exercise
Price will be treated as an adjustment to the alternative minimum tax for
federal tax purposes and may subject Optionee to the alternative minimum tax in
the year of exercise.


 


(ii)           Exercise
of Incentive Stock Option Following Disability. If Optionee’s Continuous
Status as an Employee or Consultant terminates as a result of disability that
is not total


 

















 


and permanent disability as defined in
Section 22(e)(3) of the Code, to the extent permitted on the date of
termination, Optionee must exercise an Incentive Stock Option within 90 days of
such termination for the Incentive Stock Option to be qualified as an Incentive
Stock Option.


 


(iii)          Exercise
of Nonstatutory Stock Option. There may be a regular federal income tax
liability and state income tax liability upon the exercise of a Nonstatutory
Stock Option. Optionee will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the Fair
Market Value of the Shares on the date of exercise over the Exercise Price. If
Optionee is an Employee or a former Employee, the Company will be required to
withhold from Optionee’s compensation or collect from Optionee and pay to the
applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise. If this Optionee is subject to
Section 16 of the Securities Act of 1934, as amended, the date of income
recognition may be deferred for up to six months.


 


(iv)          Disposition
of Shares. In the case of an Nonstatutory Stock Option, if Shares are held
for at least one year, any gain realized on disposition of the Shares will be
treated as long-term capital gain for federal and state income tax purposes. In
the case of an Incentive Stock Option, if Shares transferred pursuant to this
Option are held for at least one year after exercise and are disposed of at
least two years after the Date of Grant, any gain realized on disposition of
the Shares will also be treated as long-term capital gain for federal and
California income tax purposes. If Shares purchased under an Incentive Stock
Option are disposed of within such one-year period or within two years after
the Date of Grant, any gain realized on such disposition will be treated as
compensation income (taxable at ordinary income rates) to the extent of the
difference between the Exercise Price and the lesser of (1) the Fair Market
Value of the Shares on the date of exercise, or (2) the sale price of the
Shares.


 


(v)           Notice
of Disqualifying Disposition of Incentive Stock Option Shares. If this
Option granted to Optionee herein is an Incentive Stock Option, and if Optionee
sells or otherwise disposes of any of the Shares acquired pursuant to the
Incentive Stock Option on or before the later of (1) the date two years
after the Date of Grant, or (2) the date one year after the date of
exercise, Optionee shall immediately notify the Company in writing of such
disposition. Optionee agrees that Optionee may be subject to income tax
withholding by the Company on the compensation income recognized by Optionee.


 


11.           Tax
Withholding. If the Company determines that it is required to withhold any
tax as a result of the exercise of this Option, the Optionee, as a condition to
the exercise of this Option, shall make arrangements satisfactory to the
Company to enable it to satisfy all withholding requirements. The Optionee
shall also make arrangements satisfactory to the Company to enable it to timely
satisfy any withholding requirements that may arise in connection with the
vesting or disposition of Shares subject to this Option.


 

















 


12.           Entire
Agreement; Governing Law. The Plan is incorporated herein by reference. The
Plan, the Notice of Grant and this Option Agreement constitute the entire
agreement of the parties with respect to the subject matter hereof and
supersede in their entirety all prior undertakings and agreements and all
contemporaneous oral undertakings and agreements of the Company and Optionee
with respect to the subject matter hereof, including but not limited to the
grant or promise of any right or option to purchase shares of capital stock of
the Company to Optionee pursuant to any employment agreement or offer letter
delivered by the Company to Optionee or otherwise, and may not be modified to
materially and adversely affect the Optionee’s interest except by means of a
writing signed by the Company and Optionee. This Option Agreement is governed
by California law except for that body of law pertaining to its conflict of
laws.


 


13.           Optionee
Acknowledgments. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF
SHARES PURSUANT TO THE OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY
OR EMPLOYMENT AT THE WILL OF THE COMPANY (NOT THROUGH ANY OTHER MEANS,
INCLUDING WITHOUT LIMITATION, THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION
OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
NOTHING IN THIS AGREEMENT, NOR IN THE PLAN WHICH IS INCORPORATED HEREIN BY
REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION OF
EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE IN ANY WAY
WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S EMPLOYMENT
OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.


 


Optionee
acknowledges receipt of a copy of the Plan and represents that he or she is
familiar with the terms and provisions thereof, and hereby accepts this Option
subject to all of the terms and provisions thereof. Optionee has reviewed the
Plan, this Option Agreement and the Notice of Grant in their entirety, has had
an opportunity to obtain the advice of counsel prior to executing this Option
and fully understands all provisions of such documents. Optionee hereby agrees
to accept as binding, conclusive and final all decisions or interpretations of
the Administrator upon any questions arising under the Plan, the Notice of
Grant or this Option Agreement. Notwithstanding the foregoing, if any party
brings any action, suit, counterclaim, cross-claim, appeal, arbitration, or
mediation for any relief against the other to enforce the terms of or to
declare rights under this Plan or the Option Agreement, in addition to any
damages and costs which the prevailing party otherwise would be entitled, the
non-prevailing party shall pay to the prevailing party a reasonable sum for
attorneys’ fees and costs incurred in bringing and prosecuting or defending
such action or enforcing any judgment, order, ruling, or award. Optionee agrees
to timely notify the Company upon any change in the residence address indicated
below, and acknowledges that the Company may at in its discretion deliver share
certificates representing Shares issued pursuant to the exercise of this Option
to such address. Optionee agrees to provide the Company within 7 days of the
execution of this Option Agreement the Consent of Spouse attached hereto if
applicable, or within 7 days of any event that would cause such consent to be
applicable. Optionee acknowledges that the Company will rely on such agreement.