EXHIBIT 10.2


 


SRS LABS, INC.


 


Non-employee Director


Nonqualified Stock Option Agreement


(Initial Appointment)


 


Date of Grant:                         


 


WHEREAS,                                         (hereinafter
called the “Optionee”) is a Non-employee Director (as defined in the
SRS Labs, Inc. Amended and Restated 1996 Non-employee Directors Stock
Option Plan, as amended (the “Plan”)) of SRS Labs, Inc. (hereinafter
called the “Company”); and


 


WHEREAS, the Plan provides for the automatic grant of an option to
purchase 10,000 shares of common
stock, par value $.001 per share (the “Common Shares”) of the Company to be
made to each Non-employee Director of the Company on the date such Non-employee
Director is first elected a Non-employee Director, subject to the terms and
conditions of the Plan; and


 


WHEREAS, the Optionee was elected as a Non-employee Director of the
Company on                           
(the “Date of Grant”); and


 


WHEREAS, the execution of a Non-employee Director Nonqualified Stock
Option Agreement substantially in the form hereof (this or the “Agreement”) has
been authorized by a resolution of the Committee (as defined in the Plan); and


 


WHEREAS, the option granted hereby is intended as a nonqualified stock
option and shall not be treated as an “incentive stock option” within the
meaning of that term under Section 422 of the Internal Revenue Code of
1986, as amended.


 


NOW, THEREFORE, the Company hereby grants to the Optionee a
nonqualified stock option (the “Option”) pursuant to the Plan to purchase 10,000 Common Shares of the Company at a
price of $                
per share (the “Option Price”).  The
Company agrees to cause certificates for any shares purchased hereunder to be
delivered to the Optionee upon payment of the Option Price in full, all
subject, however, to the terms and conditions of the Plan and the terms and
conditions hereinafter set forth. 
Capitalized terms used herein without definition shall have the meanings
assigned to them in the Plan.


 


1.                                       This Option
(until terminated as hereinafter provided) shall be exercisable in full as of
the date hereof.  To the extent
exercisable, this Option may be exercised in whole or in part from time to
time.


 


2.                                       This Option
shall be exercised by giving written notice to the Company of the exercise
thereof, accompanied by full payment of the Option Price.  The Option Price shall be payable (a) in cash (including check, bank draft,
or money order or wire or other transfer of funds, or advice of credit to the
Company), (b) by actual or constructive
transfer to the Company of Common Shares, or (c) by
a combination of such methods of payment described in Sections 2(a) or
2(b).  The requirement of payment in cash
shall be deemed satisfied if the Optionee shall have made arrangements
satisfactory to the Company with a bank or broker who is a member of the
National Association of Securities Dealers, Inc. to sell on the exercise date a
sufficient number of shares being purchased so that the net proceeds of the
sale transaction will at least equal the Option Price plus payment of any
applicable withholding taxes and pursuant to which the bank or broker
undertakes to deliver the full Option Price plus payment of any applicable
withholding taxes to the Company on a date satisfactory to the Company, but not
later than the date on which the sale transaction will settle in the ordinary
course of business.


 


3.                                       This Option
shall terminate on the earliest of the following dates:


 


(A)                              the
later of:  (i) one year after the Optionee ceases to be a Director of the
Company or (ii) one year after the
death of the Optionee whether the Optionee dies while a Director of the Company
or within the one-year period set forth in Section 3(A)(i) hereof; or


 


(B)                                ten
years from the Date of Grant.


 


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4.                                       This Option is
not transferable by the Optionee other than (i) by will or the laws of descent
and distribution, (ii) pursuant to a qualified domestic relations order, or
(iii) by gift to a family member (as defined in the rules and regulations
relating to the use of a registration statement on Form S-8 under the
Securities Act of 1933, as amended, or any successor form).   During the lifetime of the Optionee, this
Option may be exercised only by the Optionee or such Optionee’s legal representative
or permitted successor.


 


5.                                       This Option
shall not be exercisable if such exercise would involve a violation of any
applicable federal or state securities law, and the Company hereby agrees to
make reasonable efforts to comply with such securities laws.


 


6.                                       The Board of
Directors of the Company (the “Board) shall make or provide for such
adjustments in the Option Price and the number or kind of Common Shares or
other securities covered by this Option as the Board in its sole discretion,
exercised in good faith, shall determine is equitably required to prevent
dilution or enlargement of the rights of the Optionee that otherwise would
result from (i) any stock dividend,
stock split, combination of shares, issuance of rights or warrants to purchase
stock, spin-off, recapitalization or other changes in the capital structure of
the Company, or (ii) any merger,
consolidation, reorganization or partial or complete liquidation, or (iii) any other corporate transaction or
event having an effect similar to any of the foregoing.  Furthermore, in the event any such
transaction or event described or referred to in the immediately preceding
sentence shall occur, the Board may provide in substitution of any or all of
the Optionee’s rights under this Agreement such alternative consideration
(including securities of any surviving entity) as the Board may in good faith
determine to be equitable under the circumstances and may require in connection
therewith the surrender of this Option to the extent replaced.  In any case, such substitution of securities
shall not require the consent of the undersigned or any other person.


 


7.                                       If the Optionee
becomes an employee of the Company or a Subsidiary after the Date of Grant
while remaining a member of the Board of the Company, any Option rights held
under the Plan by the Optionee at the time of commencement of such employment
shall not be affected thereby.


 


This Agreement is executed by the Company as of the                 
day of                                     .


 


	
   

  	
  SRS LABS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  The undersigned Optionee hereby acknowledges receipt of an executed
  original of this Agreement and accepts the Option granted hereunder, subject
  to the terms and conditions of the Plan and the terms and conditions
  hereinabove set forth.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
								



 


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