Form of Option Agreement


 EXHIBIT 10.3 
 APPLIED MICRO CIRCUITS CORPORATION 
 AMENDED AND RESTATED 1992 EQUITY INCENTIVE PLAN 
 STOCK OPTION AGREEMENT 
 (INCENTIVE
STOCK OPTION OR NONSTATUTORY STOCK OPTION) 
 Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this Stock Option Agreement, Applied Micro Circuits Corporation (the “Company”) has granted you an option under its Amended and
Restated 1992 Equity Incentive Plan (the “Plan”) to purchase the number of shares of the Company’s Common Stock indicated in your Grant Notice at the exercise price indicated in your Grant Notice. Defined terms not
explicitly defined in this Stock Option Agreement but defined in the Plan shall have the same definitions as in the Plan. 
 The details of
your option are as follows: 
 1. VESTING. Subject to the limitations contained herein, your option will vest as
provided in your Grant Notice, provided that vesting will cease upon the termination of your Continuous Service. 
 2.
NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common Stock subject to your option and your exercise price per share referenced in your
Grant Notice may be adjusted from time to time for Capitalization Adjustments. 
 3. EXERCISE
RESTRICTION FOR NON-EXEMPT EMPLOYEES. If you are an Employee eligible for overtime compensation under the Fair Labor Standards Act of 1938, as amended (i.e., a
“Non-Exempt Employee”), you may not exercise your option until you have completed at least six months of Continuous Service measured from the Date of Grant specified in your Grant Notice, notwithstanding any other provision
of your option. 
 4. METHOD OF PAYMENT. Payment of the exercise price is due in
full upon exercise of all or any part of your option. You may elect to make payment of the exercise price in cash or by check, bank draft or money order payable to the Company or in any other manner permitted by your Grant Notice,
which may include one or more of the following: 
 (a) In the Company’s sole discretion at the time your option is
exercised and provided that at the time of exercise the Common Stock is publicly traded and quoted regularly in The Wall Street Journal, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that,
prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds. 
 (b) In the Company’s sole discretion at the time your option is exercised and provided that at the time of exercise the Common
Stock is publicly traded and quoted regularly in The Wall Street Journal, by delivery to the Company (either by actual delivery or attestation) of already-owned shares of Common Stock that are owned free and clear of any liens, claims,
encumbrances or security interests, and that are valued at Fair Market Value on the date of 

  

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exercise. “Delivery” for these purposes, in the sole discretion of the Company at the time you exercise your option, shall include delivery to the
Company of your attestation of ownership of such shares of Common Stock in a form approved by the Company. Notwithstanding the foregoing, you may not exercise your option by tender to the Company of Common Stock to the extent such tender would
violate the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock. 
 (c) By a “net exercise” arrangement pursuant to which the Company will reduce the number of shares of Common Stock issued upon exercise by the largest whole number of shares with a Fair Market Value that does not exceed the
aggregate exercise price; provided, however, that the Company shall accept a cash or other payment from you to the extent of any remaining balance of the aggregate exercise price not satisfied by such reduction in the number of whole shares
to be issued; provided, further, that shares of Common Stock will no longer be outstanding under your option and will not be exercisable thereafter to the extent that (i) shares are used to pay the exercise price pursuant to the
“net exercise,” (ii) shares are delivered to you as a result of such exercise, and (iii) shares are withheld to satisfy tax withholding obligations. 
 (d) In any other form of legal consideration that may be acceptable to the Board. 
 5. WHOLE SHARES. You may exercise your option only for whole shares of Common Stock. 
 6. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary contained herein, you
may not exercise your option unless the shares of Common Stock issuable upon such exercise are then registered under the Securities Act or, if such shares of Common Stock are not then so registered, the Company has determined that such exercise and
issuance would be exempt from the registration requirements of the Securities Act. The exercise of your option also must comply with other applicable laws and regulations governing your option, and you may not exercise your option if the Company
determines that such exercise would not be in material compliance with such laws and regulations. 
 7. TERM.
You may not exercise your option before the commencement or after the expiration of its term. The term of your option commences on the Date of Grant and expires upon the earliest of the following: 
 (a) 90 days after the termination of your Continuous Service for any reason other than your Disability or death (the “90
Day Post-Termination Exercise Period”); 
 (b) 12 months after the termination of your Continuous Service
due to your Disability; 
 (c) 12 months after your death if you die either during your Continuous Service or within
three months after your Continuous Service terminates; 
 (d) the Expiration Date indicated in your Grant Notice; or

  

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 (e) the day before the eighth anniversary of the Date of Grant. 
 If your option is an Incentive Stock Option, note that to obtain the federal income tax advantages associated with an Incentive Stock Option, the Code
requires that at all times beginning on the date of grant of your option and ending on the day three months before the date of your option’s exercise, you must be an employee of the Company or an Affiliate, except in the event of your death or
your permanent and total disability, as defined in Section 22(e) of the Code. (The definition of disability in Section 22(e) of the Code is different from the definition of the Disability under the Plan). The Company has provided for
extended exercisability of your option under certain circumstances for your benefit but cannot guarantee that your option will necessarily be treated as an Incentive Stock Option if you continue to provide services to the Company or an Affiliate as
a Consultant or Director after your employment terminates or if you otherwise exercise your option more than three months after the date your employment with the Company or an Affiliate terminates. 
 8. EXTENSION OF TERM. 
 (a) If during any part of the 90 Day Post-Termination Exercise Period, your option is not exercisable solely because of the
condition set forth in Section 6, your option shall not expire until the earlier of the Expiration Date indicated in your Grant Notice or until it shall have been exercisable for an aggregate period of three months after the termination of your
Continuous Service. 
 (b) If during any part of the 90 Day Post-Termination Exercise Period, the sale of shares issued
upon exercise of your option would violate the Company’s Insider Trading Policy, your option shall not expire until the earlier of the Expiration Date indicated in your Grant Notice or until it shall have been exercisable for an aggregate
period of three months after the termination of your Continuous Service during which you can sell the shares issued upon exercise of your option without violating the Company’s Insider Trading Policy. 
 (c) If (i) you are a Non-Exempt Employee, (ii) you terminate your Continuous Service within six months after the Date of
Grant specified in your Grant Notice, and (iii) you have vested in a portion of your option at the time of your termination of Continuous Service, your option shall not expire until the earlier of (A) the later of the date that is seven
months after the Date of Grant specified in your Grant Notice or the date that is three months after the termination of your Continuous Service or (B) the Expiration Date indicated in your Grant Notice. 
 9. EXERCISE. 
 (a) You may exercise the vested portion of your option during its term by delivering a Notice of Exercise (in a form designated by the Company) together with the exercise price to the Secretary of the Company, or to such other person
as the Company may designate, during regular business hours, together with such additional documents as the Company may then require. 
 (b) By exercising your option you agree that, as a condition to any exercise of your option, the Company may require you to enter into an arrangement providing for the 

  

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payment by you to the Company of any tax withholding obligation of the Company arising by reason of (i) the exercise of your option, (ii) the lapse
of any substantial risk of forfeiture to which the shares of Common Stock are subject at the time of exercise, or (iii) the disposition of shares of Common Stock acquired upon such exercise. 
 (c) If your option is an Incentive Stock Option, by exercising your option you agree that you will notify the Company in writing
within 15 days after the date of any disposition of any of the shares of the Common Stock issued upon exercise of your option that occurs within two years after the date of your option grant or within one year after such shares of Common Stock are
transferred upon exercise of your option. 
 10. TRANSFERABILITY. 
 (a) Restrictions on Transfer. Your option shall not be transferable except by will or by the laws of descent and
distribution and shall be exercisable during your lifetime only by you; provided, however, that the Board may, in its sole discretion, permit you to transfer your option in a manner that is not prohibited by applicable tax and/or securities
laws upon your request. Additionally, if your option is an Incentive Stock Option, the Board may permit you to transfer your option only to the extent permitted by Sections 421, 422 and 424 of the Code and the regulations and other guidance
thereunder. 
 (b) Domestic Relations Orders. Notwithstanding the foregoing, your option may be transferred
pursuant to a domestic relations order; provided, however, that if your option is an Incentive Stock Option, your option shall be deemed to be a Nonstatutory Stock Option as a result of such transfer. 
 (c) Beneficiary Designation. Notwithstanding the foregoing, you may, by delivering written notice to the Company, in a form
provided by or otherwise satisfactory to the Company, designate a third party who, in the event of your death, shall thereafter be entitled to exercise your option. 
 11. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or service contract, and nothing in your option shall be
deemed to create in any way whatsoever any obligation on your part to continue in the employ of the Company or an Affiliate, or of the Company or an Affiliate to continue your employment. In addition, nothing in your option shall obligate the
Company or an Affiliate, their respective stockholders, Boards of Directors, Officers or Employees to continue any relationship that you might have as a Director or Consultant for the Company or an Affiliate. 
 12. WITHHOLDING OBLIGATIONS. 
 (a) At the time you exercise your option, in whole or in part, or at any time thereafter as requested by the Company, you hereby
authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for (including by means of a “cashless exercise” pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with the exercise of
your option. 
  

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 (b) Upon your request and subject to approval by the Company, in its sole
discretion, and compliance with any applicable legal conditions or restrictions, the Company may withhold from fully vested shares of Common Stock otherwise issuable to you upon the exercise of your option a number of whole shares of Common Stock
having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the minimum amount of tax required to be withheld by law (or such lower amount as may be necessary to avoid variable award accounting). If the date of
determination of any tax withholding obligation is deferred to a date later than the date of exercise of your option, share withholding pursuant to the preceding sentence shall not be permitted unless you make a proper and timely election under
Section 83(b) of the Code, covering the aggregate number of shares of Common Stock acquired upon such exercise with respect to which such determination is otherwise deferred, to accelerate the determination of such tax withholding obligation to
the date of exercise of your option. Notwithstanding the filing of such election, shares of Common Stock shall be withheld solely from fully vested shares of Common Stock determined as of the date of exercise of your option that are otherwise
issuable to you upon such exercise. Any adverse consequences to you arising in connection with such share withholding procedure shall be your sole responsibility. 
 (c) You may not exercise your option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when desired even though your option is vested, and the Company shall have no obligation to issue a certificate for such shares of Common Stock or release such shares of Common Stock from any
escrow provided for herein unless such obligations are satisfied. 
 13. NOTICES. Any notices provided for in
your option or the Plan shall be in writing and shall be hand delivered or sent by first class mail or reputable overnight delivery service, expenses prepaid. Notice may also be given by electronic mail or facsimile and shall be effective on the
date transmitted if confirmed within 24 hours thereafter by a signed original sent in a manner provided in the preceding sentence. Notices to the Company or the Board shall be delivered or sent to the Company’s headquarters, to the attention of
its Chief Financial Officer. Notices to any Optionholder or holder of shares of Common Stock issued pursuant to your option shall be sufficient if delivered or sent your address as it appears in the regular records of the Company or its transfer
agent. 
 14. AMENDMENT. This Stock Option Agreement may be amended only by a writing executed by the Company
and you which specifically states that it is amending this Stock Option Agreement. Notwithstanding the foregoing, this Stock Option Agreement may be amended solely by the Board (or appropriate committee thereof) by a writing which specifically
states that it is amending this Stock Option Agreement, so long as a copy of such amendment is delivered to you, and provided that no such amendment adversely affecting your rights hereunder may be made without your written consent. Without limiting
the foregoing, the Board (or appropriate committee thereof) reserves the right to change, by written notice to you, the provisions of this Stock Option Agreement in any way it may deem necessary or advisable to carry out the purpose of the grant as
a result of any change in applicable laws or regulations or any future law, regulation, ruling, or judicial decision, provided that any such change will be applicable only to rights relating to that portion of the option which is then subject to
restrictions as provided herein. 
  

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 15. EXECUTION OF DOCUMENTS. You hereby
acknowledge and agree that the manner selected by the Company by which you indicate your consent to your Grant Notice is also deemed to be your execution of your Grant Notice and of this Stock Option Agreement. You further agree that such manner of
indicating consent may be relied upon as your signature for establishing your execution of any documents to be executed in the future in connection with your option. This Stock Option Agreement shall be deemed to be signed by the Company and you
upon the respective signing by the Company and you of the Grant Notice to which it is attached. 
 16. GOVERNING
PLAN DOCUMENT. Your option is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your option, and is further subject to all interpretations, amendments, rules and
regulations, which may from time to time be promulgated and adopted pursuant to the Plan. In the event of any conflict between the provisions of your option and those of the Plan, the provisions of the Plan shall control. 
  

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