Document:

EX-10.1

CIRRUS LOGIC, INC.

EXECUTIVE SEVERANCE AND CHANGE OF CONTROL PLAN

1. Introduction.

This Cirrus Logic, Inc. (the “Company”) Executive Severance and Change of Control Plan (the
“Plan”) shall be effective as of October 1, 2007.

(a) Purpose. The purpose of the Plan is to describe eligibility for certain benefits
by those individuals employed by the Company and its subsidiaries at the level of Chief Executive
Officer and Vice President or above and reporting directly to the Chief Executive Officer
(“Eligible Executives”) whose employment is terminated other than for Cause, or as a result of, or
following, a Change of Control (as defined below). The Plan is intended to be maintained on an
unfunded basis. No participant shall have any right to, or interest in, any assets of the Company
that may be applied by the Company to the payment of benefits under the Plan.

(b) Effect. This Plan supersedes and replaces any prior policies or practices of the
Company or any of its subsidiaries or affiliated companies that relate to severance payments or
vesting acceleration with respect to options of the Company with respect to Eligible Executives.
Any such policies or procedures, to the extent they relate to severance payments or vesting
acceleration with respect to options of the Company, are hereby rescinded and shall no longer have
any force or effect to the extent such policies or procedures apply to Eligible Executives.
Notwithstanding the foregoing, this Plan is subordinated to any individual written (i) severance
benefit agreement, (ii) change of control severance agreement, or (iii) employment agreement that
provides for severance benefits in existence as of the date hereof between any Eligible Executive
and the Company.

2. Definition of Terms. The following capitalized terms used in this Plan shall have
the following meanings:

(a) Cause . “Cause” shall mean (i) gross negligence or willful misconduct in the
performance of an Eligible Executive’s duties to Company; (ii) a material and willful violation of
any federal or state law by an Eligible Executive that if made public would injure the business or
reputation of Company; (iii) refusal or willful failure by an Eligible Executive to comply with any
specific lawful direction or order of Company or the material policies and procedures of Company
including but not limited to the Company’s Code of Conduct and the Company’s Insider Trading Policy
as well as any obligations concerning proprietary rights and confidential information of the
Company; (iv) conviction (including a plea of nolo contendere ) of an Eligible Executive of a
felony, or of a misdemeanor that would have a material adverse effect on the Company’s goodwill if
such Eligible Executive were to be retained as an employee of the Company; or (v) substantial and
continuing willful refusal by an Eligible Executive to perform duties ordinarily performed by an
employee in the same position and having similar duties as such Eligible Executive; in each case as
reasonably determined by the Board of Directors of Company or the successor to the Company (the
“Board of Directors”).

 

(b) Change of Control. “Change of Control” shall mean the occurrence of one or
more of the following with respect to the Company:

(i) the acquisition by any person (or related group of persons), whether by tender or exchange
offer made directly to the Company’s stockholders, open market purchases or any other transaction
or series of transactions, of stock of the Company that, together with stock of the Company held by
such person or group, constitutes more than fifty percent (50%) of the total fair market value or
total voting power of the then outstanding stock of the Company entitled to vote generally in the
election of the members of the Company’s Board of Directors;

(ii) a merger or consolidation in which the Company is not the surviving entity, except for a
transaction in which both (A) securities representing more than fifty percent (50%) of the total
combined voting power of the surviving entity are beneficially owned (within the meaning of Rule
13d-3 promulgated under the Securities Exchange Act of 1934), directly or indirectly, immediately
after such merger or consolidation by persons who beneficially owned common stock immediately prior
to such merger or consolidation and (B) the members of the Board of Directors immediately prior to
the transaction (the “Existing Board”) constitute a majority of the Board of Directors immediately
after such merger or consolidation;

(iii) any reverse merger in which the Company is the surviving entity but in which either
(A) persons who beneficially owned, directly or indirectly, Common Stock immediately prior to such
reverse merger do not retain immediately after such reverse merger direct or indirect beneficial
ownership of securities representing more than fifty percent (50%) of the total combined voting
power of the Company’s outstanding securities or (B) the members of the Existing Board do not
constitute a majority of the Board of Directors immediately after such reverse merger; or

(iv) the sale, transfer or other disposition of all or substantially all of the assets of the
Company (other than a sale, transfer or other disposition to one or more subsidiaries of the
Company).

Notwithstanding the foregoing, to the extent that any amount constituting nonqualified
deferred compensation within the meaning of Section 409A of the Internal Revenue Code (including
any applicable final, proposed or temporary regulations and other administrative guidance
promulgated thereunder) would become payable under this Plan by reason of a Change of Control, such
amount shall become payable only if the event constituting a Change of Control would also
constitute a change in ownership or effective control of the Company or a change in the ownership
of a substantial portion of the assets of the Company within the meaning of Section 409A.

(c) Disability. “Disability” shall mean a mental or physical disability, illness or
injury, evidenced by medical reports from a duly qualified medical practitioner, which renders an
Eligible Executive unable to perform any one or more of the essential duties of his or her position
after the provision of reasonable accommodation, if applicable, for a period of greater than ninety
(90) days within a one year period. “Disabled” has a corresponding meaning.

 

(d) Good Reason. “Good Reason” shall mean an Eligible Executive’s resignation
from Company within thirty (30) days following the occurrence of any of the following events with
respect to such Eligible Executive:

(i) without Eligible Executive’s express written consent, the significant reduction of
Eligible Executive’s duties, authority, responsibilities, job title or reporting relationships
relative to Eligible Executive’s duties, authority, responsibilities, job title, or reporting
relationships as in effect immediately prior to such reduction, or the assignment to Eligible
Executive of such reduced duties, authority, responsibilities, job title, or reporting
relationships, which reduction or assigned reduction remains in effect five (5) business days after
written notice by the Eligible Executive to the Chief Executive Officer of such conditions;
however, the occurrence of a Change of Control shall not, in and of itself, constitute a material
adverse change in Eligible Executive’s position, duties or responsibilities;

(ii) a reduction by Company in the base salary of Eligible Executive as in effect immediately
prior to such reduction;

(iii) a material reduction by Company in the kind or level of employee benefits, including
bonuses, to which Eligible Executive was entitled immediately prior to such reduction with the
result that Eligible Executive’s overall benefits package is significantly reduced;

(iv) the relocation of Eligible Executive’s principal work location to a facility or a
location more than fifty (50) miles from Eligible Executive’s then present principal work location,
without Eligible Executive’s express written consent; or

(v) the failure of Company to obtain agreement from any successor contemplated in Section 6
below to provide the benefits provided for in this Plan, as it exists as the time of succession.

(e) Termination Date. “Termination Date” shall mean:

(i) if an Eligible Executive’s employment is terminated by Company for Disability, the date
designated by Company as the last day of such Eligible Executive’s employment;

(ii) if an Eligible Executive dies, the date of death;

(iii) if an Eligible Executive’s employment is terminated by Company for any other reason, the
date designated by Company as the last day of such Eligible Executive’s employment; or

(iv) if an Eligible Executive’s employment is terminated by such Eligible Executive, the date
designated by Company as the effective date of resignation.

 

3. Eligibility for Severance and Other Benefits. Eligible Executives will receive
the benefits described herein under the following circumstances:

(a) Termination in Connection with a Change of Control. If an Eligible Executive’s
employment terminates either by Company without Cause or by such Eligible Executive for Good Reason
at any time during the period commencing upon a Change of Control and ending twelve (12) months
following a Change of Control, then, conditioned upon the Eligible Executive’s execution and
delivery of an effective release of claims against Company and related parties that releases
Company and such parties from any claims whatsoever arising from or related to the Eligible
Executive’s employment relationship with Company including the termination of that relationship in
a form reasonably acceptable to the Company, the Eligible Executive will receive the following:

(i) Eligible Executive’s right, title and entitlement to any unvested stock options or any
other securities or similar incentives that have been granted or issued to Eligible Executive as of
the Termination Date, shall automatically be accelerated in full so as to become immediately and
completely vested. Eligible Executive shall have six months from the Termination Date to exercise
any options. In all other respects, Eligible Executive’s securities shall continue to be subject
to the terms of the applicable equity incentive plan notice of grant and grant agreement.

(ii) a lump sum cash payment equal to twelve (12) months’ salary at the Eligible Executive’s
base salary rate as of the Termination Date (without taking into account any reduction in base
salary that could trigger Eligible Executive’s resignation for Good Reason), less applicable
withholding taxes or other withholding obligations of Company and less any amounts to which
Eligible Executive is otherwise entitled under any statutory or Company long or short term
disability plan; and

(iii) if Eligible Executive elects benefits continuation under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”) following termination of employment, payment in full of a
reasonable estimate of the full cost of such benefits (either directly to Eligible Executive or to
the appropriate carrier or administrator at the Company’s election) for twelve (12) months.

(b) Termination Other Than for Cause or in Connection with a Change of Control. If
an Eligible Executive’s employment terminates without Cause (other than in connection with a Change
of Control), then, conditioned upon the Eligible Executive’s execution and delivery of an effective
release of claims against Company and related parties that releases Company and such parties from
any claims whatsoever arising from or related to the Eligible Executive’s employment relationship
with Company including the termination of that relationship in a form reasonably acceptable to the
Company, the Eligible Executive will receive the following:

(i) salary continuation for up to six (6) months’ salary (in the case of the Chief Executive
Officer, twelve (12) months’ salary) at the Eligible Executive’s base salary rate as of the
Termination Date, less applicable withholding taxes or other withholding obligations of Company and
less any amounts to which Eligible Executive is otherwise entitled under any statutory or Company
long or short term disability plan; and

(ii) if Eligible Executive elects benefits continuation under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”) following termination of employment, payment in full of a
reasonable estimate of the full cost of such benefits (either directly to Eligible Executive or to
the appropriate carrier or administrator at the Company’s election) for three (3) months.

(c) Voluntary Resignation; Termination for Cause. If an Eligible Executive’s
employment terminates by reason of voluntary resignation, or if an Eligible Executive is terminated
for Cause, then such Eligible Executive shall not be entitled to receive any benefits under
Sections 3(a) and 3(b) of this Plan.

(d) Disability. If an Eligible Executive suffers from a Disability, Company may
terminate such Eligible Executive’s employment to the extent permitted by law and the Company will
then pay to the Eligible Executive the compensation set forth in Section 3(b) of this Plan. If
such termination occurs within twelve (12) months following a Change of Control, Company will then
pay to that Eligible Executive the compensation set forth in Section 3(a) of this Plan.

 

(e) Death. If an Eligible Executive’s employment is terminated due to the death
of such Eligible Executive, the Company will pay the compensation set forth in Section 3(b) to the
former Eligible Executive’s estate. If an Eligible Executive’s employment is terminated due to the
death of such Eligible Executive within twelve (12) months following a Change of Control, then the
compensation set forth in Section 3(a) of this Plan will be paid to the former Eligible Executive’s
estate.

(f) Application of Section 409A. Notwithstanding any inconsistent provision of this
Plan, to the extent the Company determines in good faith that (a) one or more of the payments or
benefits received or to be received by an Eligible Executive pursuant to this Plan in connection
with such Eligible Executive’s termination of employment would constitute deferred compensation
subject to the rules of Section 409A, and (b) that the Eligible Executive is a “specified employee”
under Section 409A, then only to the extent required to avoid the Eligible Executive’s incurrence
of any additional tax or interest under Section 409A of the Code, such payment or benefit will be
delayed until the date which is six (6) months after the Eligible Executive’s “separation from
service” within the meaning of Section 409A. The Company will revise any applicable provisions of
this Plan to maintain to the maximum extent practicable the original intent of the applicable Plan
provisions without violating the provisions of Section 409A of the Code, if the Company deems such
revisions necessary or advisable pursuant to guidance under Section 409A to avoid the incurrence of
any such interest and penalties. Such revisions shall not result in a reduction of the aggregate
amount of payments or benefits under this Plan.

(g) Coordination with Other Change of Control Benefits, Severance Benefits or Debts.
If an Eligible Executive is entitled to cash payments, accelerated vesting of stock options or
restricted stock grants, or any other benefits from Company following the termination of such
Eligible Executive’s employment under any other agreement, plan, policy or law, then the benefits
received by that Eligible Executive under this Plan shall be reduced by the benefits received by
Eligible Executive from Company under such other plans, programs, arrangements, agreements or
requirements. If an Eligible Executive is indebted to Company at the time of a termination that
would give rise to severance benefits under Sections 3(a) or 3(b), the Company reserves the right
to offset such severance payment under the Plan by the amount of such indebtedness.

4. At-Will Employment. Each Eligible Executive’s employment is and shall continue to
be at-will, as defined under applicable law. If an Eligible Executive’s employment terminates for
any reason other than as specified in Section 3, such Eligible Executive shall not be entitled to
any benefits, damages, awards or compensation under this Plan.

5. Tax Matters. The Company may withhold from any amounts payable under the Plan such
federal, state and local taxes as may be required to be withheld. In the event that any payment or
other benefits provided for in this Plan or otherwise payable to an Eligible Executive
(i) constitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code
of 1986, as amended (the “Code”), and (ii) become subject to the excise tax imposed by Section 4999
of the Code (or any corresponding provisions of state tax law), then, notwithstanding the other
provisions of this Plan, such Eligible Executive’s benefits under Section 3 will not exceed the
amount which produces the greatest after-tax benefit to the Eligible Executive. For purposes of the
foregoing, the greatest after-tax benefit will be determined within thirty (30) days after the
Termination Date, by the Eligible Executive in his/her sole discretion. If no such determination is
made by the Eligible Executive within thirty (30) days of the Termination Date, then the Company
will pay the benefits as provided in Section 3.

6. Company’s Successors. The Company shall require that any successor to Company
(whether direct or indirect and whether by purchase, merger, consolidation, liquidation or
otherwise) to all or substantially all of Company’s business and/or assets agree to perform in
accordance with this Plan in the same manner and to the same extent as Company would be required to
perform such obligations in the absence of a succession.

7. Exclusive Benefits. Eligible Executives shall not be entitled to any payments,
compensation, benefits or other consideration from the Company, apart from those identified in
Section 3, on account of a termination.

8. Severability, Enforcement. If any provision of this Plan, or the application
thereof to any person, place or circumstance, shall be held by a court of competent jurisdiction to
be invalid, unenforceable or void, the remainder of this Plan and such provisions as applied to
other persons, places and circumstances shall remain in full force and effect.

9. General.

(a) Notice. Notices and all other communications contemplated by this Plan shall be in
writing and shall be deemed to have been duly given either (i) when personally delivered or sent by
facsimile or (ii) five (5) days after being mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. In the case of an Eligible Executive, mailed notices shall
be addressed to him or her at the home address or facsimile number which he or she most recently
communicated to Company in writing. In the case of Company, mailed notices or notices sent by
facsimile shall be addressed to its corporate headquarters, and all notices shall be directed to
the attention of its General Counsel or Chief Financial Officer.

(b) Amendment. The Company reserves the right to amend or terminate this Plan upon
written notice to Eligible Executives. Upon a Change of Control, this Plan will become
non-modifiable without the consent of the affected Eligible Executive(s). Notwithstanding the
foregoing, no Plan amendment that reduces any benefit payable under this Plan, and no Plan
termination or suspension shall be effective for a period beginning one year prior to a Change of
Control and ending one year after a Change of Control. In addition, no Eligible Executive may be
removed as a participant during such period with respect to any benefit payable with respect to
that Change of Control.

(c) Governing Law. The Plan shall be construed, administered, and enforced according
to the laws of the State of Texas, except to the extent such laws are preempted by the federal laws
of the United States of America.

10. Execution. To record the adoption of the Plan as set forth herein, effective as of
October 1, 2007, Cirrus Logic, Inc. has caused its duly authorized officer to execute the same.

 Cirrus Logic, Inc.

	 	 	 
	By:

	 	/s/ Gregory S. Thomas
	
 
	 	 
	Name:

Title:

	 	Gregory S. Thomas

Vice President, General CounselEX-10.2

CIRRUS LOGIC, INC.

2006 STOCK INCENTIVE PLAN

STOCK OPTION AGREEMENT

FOR OUTSIDE DIRECTORS

This Stock Option Agreement (this “Agreement”) is made and entered into as of the Date of
Grant set forth in the related Notice of Grant of Stock Option (“Notice of Grant”) by and between
Cirrus Logic, Inc., a Delaware corporation (the “Company”), and you as the Holder named in the
Notice of Grant (“Holder”):

WHEREAS, the Company, in order to induce you to enter into and/or continue in service to the
Company or its Affiliates in the capacity of Employee, Consultant, or Director, as applicable
(“Service”) and to materially contribute to the success of the Company, agrees to grant you an
option to acquire an interest in the Company through the purchase of shares of common stock of the
Company;

WHEREAS, the Company adopted the Cirrus Logic, Inc. 2006 Stock Incentive Plan, as it may be
amended from time to time (the “Plan”), under which the Company is authorized to grant stock
options to certain employees and service providers of the Company and its Affiliates;

WHEREAS, a copy of the Plan has been furnished to you and shall be deemed a part of this
Agreement as if fully set forth herein and terms capitalized but not defined herein shall have the
meaning set forth in the Plan; and

WHEREAS, you desire to accept the option created pursuant to this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants set forth herein and for other
valuable consideration hereinafter set forth, the parties agree as follows:

1. The Grant. Subject to the conditions set forth below, the Company hereby grants to
you, effective as of the Date of Grant set forth in the Notice of Grant, as a matter of separate
inducement and not in lieu of any salary or other compensation for your services to the Company,
the right and option to purchase (the “Option”), in accordance with the terms and conditions set
forth herein and in the Plan, an aggregate of the number of shares of Common Stock set forth in the
Notice of Grant (the “Option Shares”), at the Exercise Price set forth in the Notice of Grant (the
“Exercise Price”).

2. Exercise.

(a) Subject to the relevant provisions and limitations contained herein and in the Plan, you
may exercise the Option to purchase all or a portion of the applicable number of Vested Shares at
any time prior to the termination of the Option pursuant to this Agreement. Option Shares shall be
deemed “Nonvested Shares” unless and until they have become “Vested Shares” in accordance with the
vesting schedule set forth in the Notice of Grant, provided that you remain in the Service of the
Company or its Affiliates until the applicable dates set forth therein. In no event shall you be
entitled to exercise the Option for any Nonvested Shares or for a fraction of a Vested Share. For
administrative or other reasons, the Company may from time to time suspend the ability to exercise
options for limited periods of time, and the Committee may provide for reasonable limitations on
the number of requested exercises during any monthly or weekly period.

(b) Any exercise of the Option by you shall be made by delivery to the Company’s stock plan
administrator of (i) a completed notice of exercise in such form as may be prescribed by the
Committee, which shall specify the number of Option Shares in respect of which the Option is being
exercised and such other information and/or representations as may be required by the Committee,
and (ii) payment of the aggregate Exercise Price for the Option Shares purchased pursuant to the
exercise.

(c) Payment of the Exercise Price may be made, at your election, with the approval of the
Company, (i) in cash, by certified or official bank check or by wire transfer of immediately
available funds, (ii) by delivery to the Company of a number of shares of Common Stock having a
Fair Market Value as of the date of exercise equal to the Exercise Price (provided that such Common
Stock used for this purpose must have been held by you for such minimum period of time as may be
established from time to time by the Committee), (iii) through a “cashless exercise” in accordance
with a Company established policy or program for the same, or (iv) any combination of the
foregoing.

(d) If you are on leave of absence for any reason, the Company may, in its sole discretion,
determine that you will be considered to still be in the Service of the Company, provided that,
except as otherwise determined by the Committee, rights to the Option will be limited to the extent
to which those rights were earned or vested when the leave of absence began.

(e) The Option shall in all events terminate at the close of business on the Expiration Date
set forth in the Notice of Grant (the “Expiration Date”).

3. Effect of Termination of Service on Exercisability. Except as provided in Sections
6 and 7, this Option may be exercised only while you remain in the Service of the Company or any
Affiliate and will terminate and cease to be exercisable upon termination of your Service, except
as follows:

(a) Termination on Account of Disability. If your Service with the Company or any
Affiliate terminates by reason of disability (within the meaning of section 22(e)(3) of the Code),
this Option may be exercised by you (or your estate or the person who acquires this Option by will
or the laws of descent and distribution or otherwise by reason of your death) at any time during
the period ending on the earlier to occur of (i) the date that is twelve (12) months following such
termination, or (ii) the Expiration Date, but only to the extent this Option was exercisable for
Vested Shares as of the date your Service so terminates. You will not be considered to have
terminated your Service by reason of disability unless you furnish proof of such impairment
sufficient to satisfy the Committee in its discretion.

(b) Termination on Account of Death. If your Service with the Company or any
Affiliate terminates by reason of your death, your estate, or the person who acquires this Option
by will or the laws of descent and distribution or otherwise by reason of your death, may exercise
this Option at any time during the period ending on the earlier to occur of (i) the date that is
twelve (12) months following your death, or (ii) the Expiration Date, but only to the extent this
Option was exercisable for Vested Shares as of the date of your death.

(c) Termination not for Cause. If your Service with the Company or any Affiliate
terminates for any reason other than as described in Sections 3(a) or (b), unless such Service is
terminated for Cause (as defined below), this Option may be exercised by you at any time during the
period ending on the earlier to occur of (i) the date that is seven (7) months following your
termination, or (ii) the Expiration Date, or by your estate (or the person who acquires this Option
by will or the laws of descent and distribution or otherwise by reason of your death) during a
period of twelve (12) months following your death if you die during such three-month period, but in
each such case only to the extent this Option was exercisable for Vested Shares as of the date of
your termination. “Cause” means “cause” as defined in your employment agreement, if any, with the
Company or an Affiliate, or in the absence of such an agreement or such a definition, “Cause” will
mean a determination by the Committee that you (A) have engaged in personal dishonesty, willful
violation of any law, rule, or regulation (other than minor traffic violations or similar
offenses), or breach of fiduciary duty involving personal profit, (B) have failed to satisfactorily
perform your duties and responsibilities for the Company or any Affiliate, (C) have been convicted
of, or plead nolo contendere to, any felony or a crime involving moral turpitude, (D) have engaged
in negligence or willful misconduct in the performance of your duties, including but not limited to
willfully refusing without proper legal reason to perform your duties and responsibilities, (E)
have materially breached any corporate policy or code of conduct established by the Company or any
Affiliate as such policies or codes may be adopted from time to time, (F) have violated the terms
of any confidentiality, nondisclosure, intellectual property, nonsolicitation, noncompetition,
proprietary information or inventions agreement, or any other agreement between you and the Company
or any Affiliate related to your Service with the Company or any Affiliate, or (G) have engaged in
conduct that is likely to have a deleterious affect on the Company or any Affiliate or their
legitimate business interests, including but not limited to their goodwill and public image.

4. Non-Transferability. The Option, and any rights or interests therein, may not be
transferred in any manner except by will or the laws of descent and distribution or to the extent
approved by the Committee in accordance with the terms of the Plan.

5. Compliance with Securities Law. Notwithstanding any provision of this Agreement to
the contrary, the grant of the Option and the issuance of Common Stock will be subject to
compliance with all applicable requirements of federal, state, and foreign securities laws and with
the requirements of any stock exchange or market system upon which the Common Stock may then be
listed. The Option may not be exercised if the issuance of shares of Common Stock upon exercise
would constitute a violation of any applicable federal, state, or foreign securities laws or other
law or regulations or the requirements of any stock exchange or market system upon which the Common
Stock may then be listed. In addition, the Option may not be exercised unless (1) a registration
statement under the Securities Act of 1933, as amended (the “Act”), is at the time of exercise of
the Option in effect with respect to the shares issuable upon exercise of the Option or (2) in the
opinion of legal counsel to the Company, the shares issuable upon exercise of the Option may be
issued in accordance with the terms of an applicable exemption from the registration requirements
of the Act. YOU ARE CAUTIONED THAT THE OPTION MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS
ARE SATISFIED. ACCORDINGLY, YOU MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH
THE OPTION IS VESTED. The inability of the Company to obtain from any regulatory body having
jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the
lawful issuance and sale of any shares subject to the Option will relieve the Company of any
liability in respect of the failure to issue or sell such shares as to which such requisite
authority has not been obtained. As a condition to the exercise of the Option, the Company may
require you to satisfy any qualifications that may be necessary or appropriate to evidence
compliance with any applicable law or regulation and to make any representation or warranty with
respect to such compliance as may be requested by the Company.

6. Extension if Exercise Prevented by Law. Notwithstanding Section 3, if the exercise
of the Option within the applicable time periods set forth in Section 3 is prevented by the
provisions of Section 5, the Option will remain exercisable until 30 days after the date you are
notified by the Company that the Option is exercisable, but in any event no later than the
Expiration Date. The Company makes no representation as to the tax consequences of any such
delayed exercise. You should consult with your own tax advisor as to the tax consequences of any
such delayed exercise.

7. Extension if You are Subject to Section 16(b). Notwithstanding Section 3, if a
sale within the applicable time periods set forth in Section 3 of shares acquired upon the exercise
of the Option would subject you to suit under Section 16(b) of the Securities Exchange Act of 1934,
as amended, the Option will remain exercisable until the earliest to occur of (1) the 10th day
following the date on which a sale of such shares by you would no longer be subject to such suit,
(2) the 190th day after your termination of Service with the Company and any Affiliate, or (3) the
Expiration Date. The Company makes no representation as to the tax consequences of any such
delayed exercise. You should consult with your own tax advisor as to the tax consequences of any
such delayed exercise.

8. Withholding Taxes. The Committee may, in its discretion, require you to pay to the
Company at the time of the exercise of an Option or thereafter, the amount that the Committee deems
necessary to satisfy the Company’s current or future obligation to withhold federal, state or local
income or other taxes that you incur by exercising an Option. In connection with such an event
requiring tax withholding, you may (a) direct the Company to withhold from the shares of
Common Stock to be issued to you the number of shares necessary to satisfy the Company’s obligation
to withhold taxes, that determination to be based on the shares’ Fair Market Value as of the date
of exercise; (b) deliver to the Company sufficient shares of Common Stock (based upon the
Fair Market Value as of the date of such delivery) to satisfy the Company’s tax withholding
obligation; or (c) deliver sufficient cash to the Company to satisfy its tax withholding
obligations. If you elect to use a Common Stock withholding feature you must make the election at
the time and in the manner that the Committee prescribes. The Committee may, at its sole option,
deny your request to satisfy withholding obligations through shares of Common Stock instead of
cash. In the event the Committee subsequently determines that the aggregate Fair Market Value (as
determined above) of any shares of Common Stock withheld or delivered as payment of any tax
withholding obligation is insufficient to discharge that tax withholding obligation, then you shall
pay to the Company, immediately upon the Committee’s request, the amount of that deficiency in the
form of payment requested by the Committee.

9. Status of Common Stock. With respect to the status of the Common Stock, at the
time of execution of this Agreement you understand and agree to all of the following:

(a) You agree that the shares of Common Stock that you may acquire by exercising this Option
will not be sold or otherwise disposed of in any manner that would constitute a violation of any
applicable securities laws, whether federal or state. You also agree that the certificates
representing the shares of Common Stock purchased under this Option may bear such legend or legends
as the Committee deems appropriate to assure compliance with applicable securities laws.

(b) You agree that (1) the Company may refuse to register the transfer of the shares of Common
Stock purchased under this Option on the stock transfer records of the Company if such proposed
transfer would in the opinion of counsel satisfactory to the Company constitute a violation of any
applicable securities law and (2) the Company may give related instructions to its transfer agent,
if any, to stop registration of the transfer of the shares of Common Stock purchased under this
Option.

10. Notice of Sales Upon Disqualifying Disposition of ISO. If the Option is
designated as an Incentive Stock Option in the Notice of Grant, you must comply with the provisions
of this Section. You must promptly notify the Company in writing if you dispose of any of the
shares acquired pursuant to the Option within one year after the date you exercise all or part of
the Option or within two years after the Date of Grant. Until such time as you dispose of such
shares in a manner consistent with the provisions of this Agreement, unless otherwise expressly
authorized by the Company, you must hold all shares acquired pursuant to the Option in your name
(and not in the name of any nominee) for the one-year period immediately after the exercise of the
Option and the two-year period immediately after the Date of Grant. At any time during the
one-year or two-year periods set forth above, the Company may place a legend on any certificate
representing shares acquired pursuant to the Option requesting the transfer agent for the Company’s
stock to notify the Company of any such transfers. Your obligation to notify the Company of any
such transfer will continue notwithstanding that a legend has been placed on the certificate
pursuant to the preceding sentence.

11. Right to Terminate Services. Nothing contained in this Agreement shall confer
upon you the right to continue in the employ of or performing services for the Company or any
Affiliate, or interfere in any way with the rights of the Company or any Affiliate to terminate
your employment or service relationship at any time.

12. Furnish Information. You agree to furnish to the Company all information
requested by the Company to enable it to comply with any reporting or other requirement imposed
upon the Company by or under any applicable statute or regulation. You further agree to notify the
Company upon any change in the residence address indicated on the Notice of Grant.

13. Dispute Resolution. The provisions of this Section shall be the exclusive means
of resolving disputes arising out of or relating to the Notice of Grant, the Plan, the Option and
this Agreement. The Company, you, and your assignees pursuant to Sections 3 and 4 (the “parties”)
shall attempt in good faith to resolve any disputes arising out of or relating to the Notice of
Grant, the Plan, the Option and this Agreement by negotiation between individuals who have
authority to settle the controversy. Negotiations shall be commenced by either party by notice of
a written statement of the party’s position and the name and title of the individual who will
represent the party. Within thirty (30) days of the written notification, the parties shall meet
at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary,
to resolve the dispute.

Any controversy, dispute or claim that has not been settled by negotiation within thirty (30)
days of the written notification as set forth above shall be finally settled by arbitration under
the Commercial Arbitration Rules of the American Arbitration Association (“AAA”) by three
arbitrators. In such event, the claimant will deliver a written notice to the respondent(s) and
the AAA initiating arbitration and naming an arbitrator. Within twenty (20) days after receipt of
such arbitration notice, the respondent(s) shall name an arbitrator. Within twenty (20) days from
the naming of the two arbitrators, the two arbitrators shall name a third arbitrator. If there are
multiple claimants and/or multiple respondents, all claimants and/or all respondents shall attempt
to agree upon naming their respective arbitrator. If the claimants or respondents, as the case may
be, fail to name their respective arbitrator, or if the two arbitrators fail to name a third
arbitrator, or if within twenty (20) days after any arbitrator shall resign or otherwise cease to
serve as such a replacement arbitrator is not named by the party that originally named such
arbitrator, such arbitrator as to which agreement cannot be reached or as to which a timely
appointment is not made shall be named by the AAA. The place of arbitration shall be Austin,
Texas. The award of the arbitrators may be entered in any court of competent jurisdiction. The
costs of the arbitration shall be shared by the disputing parties equally. Notwithstanding
anything to the contrary herein, the arbitrators shall not award nor shall the Company have any
liability for any consequential, punitive, special, incidental, indirect or similar damages.

14. Notices. Any notice required or permitted hereunder shall be given in writing and
shall be deemed effectively given upon personal delivery or upon deposit in the United States mail
by certified mail (if the parties are in the United States) or upon deposit for delivery by an
internationally recognized express mail courier service (for international delivery of notice),
with postage and fees prepaid, addressed to the other party at its address as such party may
designate in writing from time to time to the other party.

15. No Liability for Good Faith Determinations. The Company and the members of the
Committee and the Board shall not be liable for any act, omission or determination taken or made in
good faith with respect to this Agreement or the Option granted hereunder.

16. Execution of Receipts and Releases. Any payment of cash or any issuance or
transfer of shares of Common Stock or other property to you, or to your legal representative, heir,
legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be
in full satisfaction of all claims of such persons hereunder. The Company may require you or your
legal representative, heir, legatee or distributee, as a condition precedent to such payment or
issuance, to execute a release and receipt therefore in such form as it shall determine. 

17. No Guarantee of Interests. The Board and the Company do not guarantee the Common
Stock of the Company from loss or depreciation. 

18. Company Records. Records of the Company regarding your Service and other matters
shall be conclusive for all purposes hereunder, unless determined by the Company to be incorrect.

19. Successors. This Agreement shall be binding upon you, your legal representatives,
heirs, legatees and distributees, and upon the Company, its successors and assigns.

20. Severability. If any provision of this Agreement is held to be illegal or invalid
for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but
such provision shall be fully severable and this Agreement shall be construed and enforced as if
the illegal or invalid provision had never been included herein.

21. Headings. The titles and headings of paragraphs are included for convenience of
reference only and are not to be considered in construction of the provisions hereof.

22. Governing Law. All questions arising with respect to the provisions of this
Agreement shall be determined by application of the laws of the State of Delaware, without giving
any effect to any conflict of law provisions thereof, except to the extent Delaware law is
preempted by federal law. The obligation of the Company to sell and deliver Common Stock hereunder
is subject to applicable laws and to the approval of any governmental authority required in
connection with the authorization, issuance, sale, or delivery of such Common Stock.

23. Electronic Delivery. The Company may, in its sole discretion, decide to deliver
any documents related to the Option granted under the Plan or future options that may be granted
under the Plan by electronic means or to request your consent to participate in the Plan by
electronic means. You hereby consent to receive such documents by electronic delivery and, if
requested, to agree to participate in the Plan through an on-line or electronic system established
and maintained by the Company or another third party designated by the Company.

24. Word Usage. Words used in the masculine shall apply to the feminine where
applicable, and wherever the context of this Agreement dictates, the plural shall be read as the
singular and the singular as the plural.

25. Miscellaneous.

(a) This Agreement is subject to all the terms, conditions, limitations and restrictions
contained in the Plan. In the event of any conflict or inconsistency between the terms hereof and
the terms of the Plan, the terms of the Plan shall be controlling.

(b) The Option may be amended by the Board or by the Committee at any time (i) if the Board or
the Committee determines, in its sole discretion, that amendment is necessary or advisable in light
of any addition to or change in any federal or state, tax or securities law or other law or
regulation, which change occurs after the Date of Grant and by its terms applies to the Option; or
(ii) other than in the circumstances described in clause (i) or provided in the Plan, with your
consent.

(c) If this Option is designated as an Incentive Stock Option in the Notice of Grant, then in
the event the Option Shares (and all other options granted to you by the Company or any parent of
the Company or subsidiary that are designated as incentive stock options within the meaning of
section 422 of the Code) that first become exercisable in any calendar year have an aggregate fair
market value (determined for each Option Share as of the Date of Grant) that exceeds $100,000, the
Option Shares in excess of $100,000 shall be treated as subject to a Nonstatutory Stock Option.

By your signature below, or by your electronic acceptance of this Agreement, you agree to all
the terms and conditions of the Option, the Plan, and this Agreement. You acknowledge that you
have had the opportunity to review the Plan and this Agreement in their entirety and to obtain the
advice of counsel prior to executing this Agreement. You agree to accept as binding, conclusive
and final all decisions or interpretations of the Committee upon any questions relating to the
Option, the Plan, or this Agreement.

AGREED AND ACCEPTED:

     

Signature of Holder

     

Printed Name of Holder

Date:      

699594_4

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