Document:

exv10w1

 

Exhibit 10.1

January 13, 2006

Karl Moeller

27400 Loma Prieta Way

Los Gatos CA 95033

Dear Karl:

Alliance Semiconductor Corporation is pleased to offer you employment as an Interim Chief Financial
Officer, reporting to Melvin Keating. Your starting base salary will be $20,000 per month. Your
salary will be paid in accordance with Alliance’s payroll policies, as amended from time to time.

In addition, you will receive an option to purchase 25,000 common shares of Alliance Semiconductor,
based on the same plan and vesting schedule as Melvin Keating.

Also, you will be eligible to receive the medical and dental insurance coverage provided under
Alliance’s group insurance plans, and will be eligible to participate in Alliance’s 401(k) plan.
You will receive ten days paid vacation per year, which accrues on a monthly basis.

As an Alliance employee, you will be expected to abide by company rules and regulations. You will
be expected to sign and comply with our employee agreement which requires, among other provisions,
the assignment of patent rights to any invention made during your employment at Alliance, and
nondisclosure of confidential and proprietary information. This offer is subject to your
completion of an I-9 form and satisfactory documentation respecting your identification and right
to work in the United States, no later than three days after your employment begins. Additionally,
this offer of employment is contingent upon the successful completion of a background check.

Employment at Alliance is on an “AT-WILL” basis. As an employee, you may terminate
employment at any time, and for any reason whatsoever, with notice to Alliance. We request that,
in the event of resignation, you give the company at least two weeks notice. Similarly, Alliance
may terminate your employment at any time, and for any reason whatsoever, with or without cause.
Furthermore, this mutual termination of employment arrangement supercedes any prior written and
oral agreement between us.

This letter sets forth all of the terms relating to your potential employment by Alliance, and
supersedes all other discussions, whether written or oral. The terms relating to your actual or
potential employment by
Alliance, including the terms of this letter, may not be modified or amended, except in writing
signed by both parties. Should any controversy arise between us resulting from this offer, we
agree to submit such a
controversy to binding arbitration, using a neutral arbitrator (either agreed upon, or appointed by
a court of competent jurisdiction), under the rules of the American Arbitration Association,
providing adequate discovery necessary to vindicate each party’s claims, requiring a written
arbitration award, without limitation on statutory remedies, and where Alliance shall pay all
reasonable costs associated with such an arbitration.

 

 

Alliance Offer Of Employment

Page 2

Please give this offer your careful consideration. I believe your association with Alliance would
be very beneficial to both you and Alliance. Please indicate your acceptance of this employment
offer by signing below and returning it to Angel Middour, in the Human Resources Department, by
January 16, 2006.

Sincerely,

/s/ Melvin L. Keating
Melvin L. Keating
Interim President and CEO

 

Acceptance of Offer of Employment

I accept this offer of employment according to the terms of this letter:

                                   /s/ Karl H. Moeller, Jr.

 

                                   signature

                                   Karl H. Moeller, Jr.

 

                                   printed name

                                   1/13/2006

 

                                   date

                                   1/13/2006

 

                                   my proposed start dateexv10w2

 

Exhibit 10.2

Alliance Semiconductor Corporation

2575 Augustine Dr.

Santa Clara, CA 95054

Notice of Grant of Stock Options and Option Agreement

	 	 	 
	Karl H. Moeller, Jr.

	 	Option Number:
	c/o Alliance Semiconductor Corporation

	 	Plan:                         2002 Stock Option Plan, as amended
	2575 Augustine Dr.
	 	 
	Santa Clara, CA United States 95054

	 	ID:

Effective 1/13/2006, you were granted a(n) Incentive Stock Option to buy 25,000 shares of
Alliance Semiconductor (the Company) stock at $2.6600 per share.

The total option price of the shares granted is $66,500.00.

Shares will vest in increments on the vesting dates shown in the table below.

	 	 	 	 	 	 	 	 	 
	 	 	Shares	 	Vesting Date	 	Expiration	 	 
	 
	 	5,000
	 	1/13/2007
	 	1/12/2016	 	 
	 
	 	5,000
	 	1/13/2008
	 	1/12/2016	 	 
	 
	 	5,000
	 	1/13/2009
	 	1/12/2016	 	 
	 
	 	5,000
	 	1/13/2010
	 	1/12/2016	 	 
	 
	 	5,000
	 	1/13/2011
	 	1/12/2016	 	 

By your signature and the Company’s signature below, you and the Company agree that these options
are granted under and governed by the terms and conditions of the Company’s Stock Option Plan as
amended and the Option Agreement, all of which are attached and made a part of this document.

	 	 	 
	/s/
Melvin L. Keating

	 	January 20, 2006
	 
	 	 
	ALLIANCE SEMICONDUCTOR CORPORATION
	 	 
	By: Melvin L. Keating
	 	Date
	Title: Interim President and Chief Executive Officer
	 	 
	 
	 	 
	/s/ Karl H. Moeller, Jr.

	 	January 20, 2006
	 
	 	 
	Karl H. Moeller, Jr.

	 	Date

 

 

Option Agreement

This Option Agreement (“Option Agreement”) and the attached Notice of Grant of Stock Options and
Option Agreement (“Notice”), forming one agreement (“Agreement”), is entered into as of effective
date specified in the Notice (“Effective Date”) by and between Alliance Semiconductor Corporation,
a Delaware corporation with executive offices at 2575 Augustine Drive, Santa Clara, California
95054 (“Company”) and the optionee specified in the Notice (“Optionee”).

	1.	 	Grant of Option

The Company hereby grants to the Optionee an option (“Option”) to purchase the total number of
shares of common stock, $0.0l par value, of the Company set forth in the Notice (“Shares”) at the
exercise price per share set forth in the Notice (“Exercise Price”), subject to all of the terms
and conditions of this Agreement and the Company’s 2002 Stock Option Plan, as amended to the date
hereof (“Plan”). If designated as an Incentive Stock Option in the Notice, this Option is intended
to qualify as an “incentive stock option” (“ISO”) within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (“Revenue Code”). Unless otherwise defined herein, capitalized
terms used herein shall have the meanings ascribed to them in the Plan.

	2.	 	Exercise Period of Option

Subject to the terms and conditions of the Plan and this Option Agreement, this Option shall become
exercisable as to portions of the Shares as described in the Notice, provided, however, that this
Option shall expire on the Expiration Date set forth above and must be exercised, if at all, on or
before the Expiration Date.

	3.	 	Restriction on Exercise

This Option may not be exercised unless such exercise is in compliance with the Securities Act of
1933 and all applicable state securities laws as they are in effect on the date of exercise, and
the requirements of any stock exchange or national market system on which the Company’s common
stock may be listed at the time of exercise. Optionee understands that the Company is under no
obligation to register, qualify or list the Shares with the Securities and Exchange Commission
(“SEC”), any state securities commission or any stock exchange to effect such compliance.

	4.	 	Termination of Option

Except as provided below in this Paragraph, this Option shall terminate and may not be exercised if
Optionee ceases to be employed by the Company or any Parent or Subsidiary of the Company (or, in
the case of a nonqualified stock option, an Affiliate of the Company). Optionee shall be
considered to be employed by the Company or any Parent, Subsidiary or Affiliate of the Company for
all purposes under Paragraph 2 and this Paragraph 4 if Optionee is an officer, director or
full-time employee of the Company or of any Parent, Subsidiary or Affiliate of the Company or if
the Committee determines that Optionee is rendering substantial services as a part-time employee,
consultant, contractor or adviser to the Company or to any Parent, Subsidiary or Affiliate of the
Company. The Committee shall have discretion to determine whether Optionee has ceased to be
employed by the Company or by any Parent, Subsidiary or Affiliate of the Company and the effective
date on which such employment terminated (the “Termination Date”).

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	4.1	 	Termination Generally

If Optionee ceases to be employed by the Company or by any Parent, Subsidiary or Affiliate
of the Company for any reason except death or disability, this Option, to the extent (and
only to the extent) that it would have been exercisable by Optionee on the Termination Date,
may be exercised by Optionee within thirty (30) days after the Termination Date, but in no
event later than the Expiration Date.

	4.2	 	Death or Disability

If Optionee’s employment with the Company or with any Parent, Subsidiary or Affiliate of the
Company is terminated because of the death of Optionee or the disability of Optionee within
the meaning of Section 22(e)(3) of the Revenue Code, this Option, to the extent (and only to
the extent) that it would have been exercisable by Optionee on the Termination Date, may be
exercised by Optionee (or by Optionee’s legal representative) within six (6) months after
the Termination Date, but in no event later than the Expiration Date.

	4.3	 	No Right to Employment

Nothing in the Plan or in this Option Agreement shall confer on Optionee any right to
continue in the employ of, or other relationship with, the Company or with any Parent,
Subsidiary or Affiliate of the Company or limit in any way the right of the Company or of
any Parent, Subsidiary or Affiliate of the Company to terminate Optionee’s employment or
other relationship at any time, with or without cause.

	5.	 	Manner of Exercise

	5.1	 	Exercise Agreement

This Option shall be exercisable by delivery to the Company of an executed written Stock
Option Exercise Agreement in the form attached hereto, or in such other form as may be
approved by the Company (“Exercise Agreement”), which shall set forth Optionee’s election to
exercise some or all of this Option, the number of Shares being purchased, any restrictions
imposed on the Shares and such other representations and agreements as may be required by
the Company to comply with applicable securities laws.

	5.2	 	Exercise Price

Such Exercise Agreement shall be accompanied by full payment of the Exercise Price for the
Shares being purchased. Payment for the Shares may be made in cash (by check) or, where
permitted by law:

	5.2.1	 	by cancellation of indebtedness of the Company to Optionee;

	5.2.2	 	where approved by the Committee, by surrender of shares of common stock of the Company
having a Fair Market Value equal to the exercise price of the Option that have been owned by
Optionee for more than six (6) months (and which have been paid for within the meaning of SEC
Rule 144 and, if such Shares were purchased from the Company by use of a promissory note, such
note has been fully paid with respect to such shares), or were obtained by Optionee in the
open public market; and are clear of all liens, claims, encumbrances and security interests

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(provided, however, that in the case of ISOs, the Committee’s approval must have been made at the
time of grant);

	5.2.3	 	by waiver of compensation due or accrued to Optionee for services rendered;
	 
	5.2.4	 	provided that a public market for the Company’s stock exists, through a “same day sale”
commitment from Optionee and a broker-dealer that is a member of the National Association of
Securities Dealers (an “NASD Dealer”) whereby Optionee irrevocably elects to exercise the
Option and to sell a portion of the Shares so purchased to pay for the Exercise Price and
whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the
Exercise Price directly to the Company; or
	 
	5.2.5	 	by any combination of the foregoing.

	5.3	 	Withholding Taxes
	 
	 	 	Prior to the issuance of the Shares upon exercise of this Option, Optionee must pay or make
adequate provision for any applicable federal, state or local withholding obligations of the
Company. Optionee may provide for payment of Optionee’s minimum statutory withholding taxes
upon exercise of the Option by requesting that the Company retain Shares with a Fair Market
Value equal to the minimum amount of taxes required to be withheld, all as set forth in
Section 6.3 of the Plan. In such case, the Company shall issue the net number of Shares to
Optionee by deducting the Shares retained from the Shares exercised.
	 
	5.4	 	Issuance of Shares
	 
	 	 	Provided that such Exercise Agreement and payment are in form and substance satisfactory to
counsel for the Company, the Company shall cause the Shares to be issued in the name of
Optionee, Optionee’s legal representative or Optionee’s authorized assignee. Optionee
hereby agrees that in the event that Optionee elects to pay for the Shares by means of a
“same day sale” as set forth in Section 5.2.4, Optionee shall cause the NASD Dealer to pay
the Company the Exercise Price for the Shares. The Company hereby agrees to permit a “same
day sale” sufficient to enable the NASD Dealer to pay the Company the Exercise Price for the
Shares.

	6.	 	Market Standoff Agreement

Optionee agrees in connection with any registration of the Company’s securities that, upon the
request of the Company or the underwriters managing any public offering of the Company’s
securities, Optionee will not sell or otherwise dispose of any Shares or any other securities of
the Company without the prior written consent of the Company or such underwriters, as the case may
be, for such period of time from the effective date of such registration as the Company or the
underwriters may specify for employee shareholders generally. Optionee understands and agrees
that, in order to ensure compliance with the market standoff agreement, the Company may issue
appropriate “stop-transfer” instructions to its transfer agent.

	7.	 	Notice of Disqualifying Disposition of ISO Shares

If the Option granted to Optionee herein is an ISO, and if Optionee sells or otherwise disposes of
any of the Shares acquired pursuant to the ISO within the date two years after the Date of Grant,
or the date one year after exercise of the ISO with respect to the Shares to be sold or disposed,
Optionee shall immediately notify the Company in writing of such disposition. Optionee
acknowledges and agrees that

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Optionee may be subject to income tax withholding by the Company on the compensation income
recognized by Optionee from any such early disposition by payment in cash (or in Shares, to the
extent permissible under Section 5.3) or out of the current wages or other earnings payable to
Optionee. Optionee hereby authorizes his/her broker(s) to provide the Company, promptly at the
Company’s request, with any information concerning the Shares, now or previously in Optionee’s
account(s) with such broker(s), as the Company may request. Optionee agrees that this
authorization may not be revoked or modified in any manner except pursuant to a writing signed by
both Optionee and the Company.

	8.	 	Nontransferability of Option

If this Option is an ISO, or if Optionee is an Insider subject to Section 16(b) of the Securities
Exchange Act of 1934, then this Option may not be transferred in any manner other than by will or
by the law of descent and distribution and may be exercised during the lifetime of Optionee only by
Optionee. Otherwise, this Option may only be transferred to Optionee’s immediate family, to a
trust for the benefit of Optionee or Optionee’s immediate family, or to a charitable entity
qualified under Revenue Code Section 501(c), where “immediate family” shall mean spouse, lineal
descendant or antecedent, brother or sister. The terms of this Option shall be binding upon the
executors, administrators, successors and assigns of Optionee.

	9.	 	Tax Consequences

Set forth below is a brief summary as of the date this form of Option Agreement was adopted of some
of the federal and California 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.

	9.1	 	Exercise of ISO
	 
	 	 	If this Option qualifies as an ISO, there will be no regular federal income tax liability or
California income tax liability upon the exercise of the 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 alternative minimum taxable income for federal income
tax purposes and may subject Optionee to an alternative minimum tax liability in the year of
exercise.
	 
	9.2	 	Exercise of Nonqualified Stock Option
	 
	 	 	If this Option does not qualify as an ISO, there may be a regular federal income tax
liability and a California income tax liability upon the exercise of the 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. The Company may be required to withhold from Optionee’s
compensation or collect from Optionee and pay to the applicable taxing authorities an amount
equal to a percentage of this compensation income at the time of exercise.
	 
	9.3	 	Disposition of Shares
	 
	 	 	In the case of a nonqualified stock option (an “NQSO”), if Shares are held for more than one
year before disposition, any gain on disposition of the Shares will be treated as long-term
capital gain for federal and California income tax purposes. In the case of an ISO, if
Shares are held for more than one year after the date of exercise and more than two years
after the Date of Grant, any gain

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	 	 	on disposition of the Shares will be treated as long-term capital gain for federal and
California income tax purposes. If Shares acquired pursuant to an ISO are disposed of
within such one year or two year periods (a “disqualifying disposition”), gain on such
disqualifying disposition will be treated as compensation income (taxable at ordinary income
rates) to the extent of the excess, if any, of the Fair Market Value of the Shares on the
date of exercise over the Exercise Price (the “Spread”), or, if less, the difference between
the amount realized on the sale of such Shares and the Exercise Price. Any gain in excess
of the Spread shall be treated as capital gain.

	10.	 	Change of Control Acceleration.

Notwithstanding the above, in the event of a Change of Control (as defined below) and irrespective
of whether this Option is assumed, substituted or terminated in connection with the transaction,
the vesting and exercisability of this Option shall accelerate such that this Option shall become
vested and exercisable to the extent of 100% of the Shares then unvested, effective immediately
prior to the consummation of the transaction. For purposes of this Agreement, a “Change of
Control” means:

	 	(i)	 	a sale, transfer or disposition of all or substantially all of the Company’s
assets other than to (A) a corporation or other entity of which at least a majority of
its combined voting power is owned directly or indirectly by the Company, (B) a
corporation or other entity owned directly or indirectly by the stockholders of the
Company in substantially the same proportions as their ownership of Company common
stock, or (C) a continuing or surviving entity described in subsection (ii) below;
	 
	 	(ii)	 	any merger, consolidation or other business combination transaction of the
Company with or into another corporation, entity or person, other than a transaction in
which the holders of at least a majority of the shares of voting capital stock of the
Company outstanding immediately prior to such transaction continue to hold (either by
such shares remaining outstanding or by their being converted into shares of voting
capital stock of the surviving entity) a majority of the total voting power represented
by the shares of voting capital stock of the Company (or the surviving entity)
outstanding immediately after such transaction; or
	 
	 	(iii)	 	the direct or indirect acquisition (including by way of a tender or exchange
offer) by any person, or persons acting as a group, of beneficial ownership or a right
to acquire beneficial ownership of shares representing a majority of the voting power
of the then outstanding shares of capital stock of the Company; provided that the term
“person” shall not include the Company or those entities described in subsections
(i)(A) and (B) above.
	 
	 	 	 	Notwithstanding anything stated herein, a transaction shall not constitute a “Change
of Control” if its sole purpose is to change the state of the Company’s
incorporation, to create a holding company that will be owned in substantially the
same proportions by the persons who hold the Company’s securities immediately before
such transaction, or to consummate an equity financing approved by the Board.

	11.	 	Interpretation

Any dispute regarding the interpretation of this Option Agreement shall be submitted by Optionee or
the Company to the Committee for review. The resolution of such a dispute by the Board or
Committee shall be final and binding on the Company and on Optionee.

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	12.	 	Privileges of Stock Ownership

Optionee shall not have any of the rights of a stockholder with respect to any Shares until
Optionee exercises the Option and pays the Exercise Price.

	13.	 	Notices

All notices required or permitted by this Agreement must be in writing and shall be deemed to have
been duly given if delivered by hand; mailed, postage prepaid, by certified or registered mail,
return receipt requested; or deposited with any return receipt express courier, prepaid; and
addressed to Company at the address listed above or Optionee at their address listed in the Notice.
Optionee shall be obligated to timely notify the Company in writing of any change in Optionee’s
address. Notice of change of address shall be effective only when done in accordance with this
subparagraph. All notices shall be deemed to have been given or delivered upon: personal delivery;
three days after deposit in the United States mail by certified or registered mail, return receipt
requested; or one business day after deposit with any return receipt express courier (prepaid).

	14.	 	Successors and Assigns

The Company may assign any of its rights under this Option Agreement. This Option Agreement shall
be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to
the restrictions on transfer set forth herein, this Option Agreement shall be binding upon Optionee
and Optionee’s heirs, executors, administrators, legal representatives, successors and assigns.

	15.	 	Entire Agreement

The Notice, the Plan, and the Exercise Agreement are incorporated herein by this reference. This
Option Agreement, the Notice, the Plan and the Exercise Agreement (the “Stock Agreements”)
constitute the entire agreement of the parties hereto and supersede all prior undertakings and
agreements, oral or written, with respect to the subject matter hereof. The Stock Agreements may
not be contradicted by evidence of any prior or contemporaneous agreement. To the extent that the
policies and procedures of the Company apply to Optionee and are inconsistent with the terms of the
Stock Agreements, the provisions of the Stock Agreements shall control.

	16.	 	Amendments and Waivers

None of the Stock Agreements may be modified, amended, or terminated except by an instrument in
writing, signed by each of the parties (in the case of the Company, such instrument must be signed
by the President of the Company to be effective). No failure to exercise and no delay in
exercising any right, remedy, or power under any of the Stock Agreements shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, or power under any of the
Stock Agreements preclude any other or further exercise thereof, or the exercise of any other
right, remedy, or power provided herein or by law or in equity. All rights and remedies, whether
conferred by any of the Stock Agreements, by any other instrument or by law, shall be cumulative,
and may be exercised singularly or concurrently.

	17.	 	Severability and Enforcement

If any provision of this Agreement is held invalid, illegal or unenforceable in any respect
(“Impaired Provision”), (a) such Impaired Provision shall be interpreted in such a manner as to
preserve, to the maximum extent possible, the intent of the parties, (b) the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or impaired thereby,
and (c) such decision shall not

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affect the validity, legality or enforceability of such Impaired Provision under other
circumstances. The parties agree to negotiate in good faith and agree upon a provision to
substitute for the Impaired Provision in the circumstances in which the Impaired Provision is
invalid, illegal or unenforceable.

	18.	 	Attorneys’ Fees and Costs

In any legal action, arbitration, or other proceeding brought to enforce or interpret the terms of
any of the Agreements, the substantially prevailing party shall be entitled to recover reasonable
attorneys’ fees and costs.

	19.	 	Governing Law and Jurisdiction

The Stock Agreements shall be governed by and construed in accordance with the law of the State of
California, without reference to that body of law concerning choice of law or conflicts of law,
except that the General Corporation Law of Delaware (“GCLD”) shall apply to all matters governed by
the GCLD, including without limitation matters concerning the validity of grants of stock options
and actions of the Company’s board of directors or any committee thereof.

	20.	 	Action by the Company

All actions required or permitted to be taken under any of the Stock Agreements by the Company,
including without limitation, exercise of discretion, consents, waivers, and amendments to any of
the Agreements, shall be made and authorized only by the President or by his or her representative
specifically authorized to fulfill these obligations under the Stock Agreements.

	21.	 	No Duty to Disclose

Optionee acknowledges and agrees that neither the Company nor any of the Company’s officers,
directors, shareholders, employees, agents or representatives has any duty or obligation to
disclose to Optionee any information whatsoever, including but not limited to information
concerning the Company that might if made public affect the value of the Shares. Such information
includes without limitation any information concerning the Company’s actual or potential financial
performance, actual or potential material contracts to which the Company is or may become a party,
or actual or potential material transactions that involve or may involve the Company, including but
not limited to plans to effect a merger or to acquire or dispose of a material amount of assets.
Optionee acknowledges and understands that he or she (a) might exercise his or her Option (or a
portion thereof) prior to the public dissemination of such information, and that the value of the
Shares may decrease after the public dissemination of such information, or (b) might exercise his
or her Option (or a portion thereof) and sell, pledge or encumber the Shares (or a portion thereof)
prior to the public dissemination of such information, and that the value of the Shares may
increase after the public dissemination of such information; and Optionee acknowledges and agrees
that he or she will not bring or participate in any claim whatsoever against the Company or against
any of the Company’s officers, directors, shareholders, employees, agents or representatives
related to the failure to have disclosed such information prior to Optionee’s exercise and/or sale,
pledge or encumbrance.

	22.	 	Agreement to Arbitrate

Optionee and the Company recognize that differences may arise between them during or following
Optionee’s employment with the Company, and that those differences may or may not be related to the
grant of options herein or to Optionee’s employment. Optionee understands and agrees that by
entering into this Option Agreement, Optionee anticipates the benefits of a speedy, impartial
dispute-resolution

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procedure of any such differences. As used in this Section 22, the “Company” shall also refer to
all benefit plans, the benefit plans’ sponsors, fiduciaries, administrators, affiliates, and all
successors and assigns of any of them.

	22.1	 	Arbitrable Claims
	 
	 	 	ALL DISPUTES BETWEEN OPTIONEE (AND HIS SUCCESSORS AND ASSIGNS) AND THE COMPANY (AND ITS
AFFILIATES, SHAREHOLDERS, DIRECTORS, OFFICERS AND ASSIGNS) RELATING IN ANY MANNER WHATSOEVER
TO THE EMPLOYMENT OR TERMINATION OF OPTIONEE, INCLUDING WITHOUT LIMITATION ALL DISPUTES
ARISING UNDER ANY OF THE STOCK AGREEMENTS (“ARBITRABLE CLAIMS”) SHALL BE RESOLVED BY
ARBITRATION. Arbitrable Claims shall include, but are not limited to, contract (express or
implied) and tort claims of all kinds, as well as all claims based on any federal, state, or
local law, statute, or regulation (including but not limited to claims alleging unlawful
harassment or discrimination in violation of Title VII and/or Title IX of the U.S. Code, of
the Age Discrimination in Employment Act, of the Americans with Disabilities Act, of state
statute, or otherwise), excepting only claims under applicable workers’ compensation law and
unemployment insurance claims. Arbitration shall be final and binding upon the parties and
shall be the exclusive remedy for all Arbitrable Claims. Except as provided in the
following sentences of this Paragraph 21(a).
	 
	22.2	 	Arbitration Procedure
	 
	22.2.1	 	American Arbitration Association Rules; Initiation of Arbitration; Location of
Arbitration. Arbitration of Arbitrable Claims shall be in accordance with the Employment
Dispute Resolution Rules of the American Arbitration Association (“AAA Employment Rules”),
except as provided otherwise in this Option Agreement. Arbitration shall be initiated by
providing written notice to the other party with a statement of the claim(s) asserted, the
facts upon which the claim(s) are based, and the remedy sought. The arbitration shall take
place in San Jose, California or in the county in which the claims arose.
	 
	22.2.2	 	Selection of Arbitrator. All disputes involving Arbitrable Claims shall be decided
by a single arbitrator (“Arbitrator”), who shall be selected as follows. The American
Arbitration Association (“AAA”) shall give each party a list of eleven (11) arbitrators drawn
from its panel of employment arbitrators. Each party may strike all names on the list it
deems unacceptable. If only one common name remains on the lists of all parties, that
individual shall be designated as the Arbitrator. If more than one common name remains on the
lists of all parties, the parties shall strike names alternately until only one remains. If
no common name remains on the lists of all parties, the AAA shall furnish an additional list
or lists until an Arbitrator is selected. Notwithstanding any other provision herein to the
contrary, if a party strikes all eleven names on each of the first and the second lists
provided by the AAA, such party shall be deemed to have stricken such names in bad faith, and
all twenty-two names on the lists shall be deemed acceptable to such party, and the other
party shall select the Arbitrator.
	 
	22.2.3	 	Conduct of the Arbitration.

22.2.3.1      Discovery. To help prepare for the arbitration, Optionee and the Company shall be
entitled to conduct that discovery that the arbitrator deems necessary to enable the party to
reasonably investigate their claims or defenses. At least thirty (30) days before the arbitration,
the parties must exchange lists of witnesses, including any expert witnesses, and copies of all
exhibits intended to be used at the arbitration.

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22.2.3.2      Authority. The Arbitrator shall have jurisdiction to hear and rule on pre-hearing
disputes and is authorized to hold pre-hearing conferences by telephone or in person as the
Arbitrator deems necessary. The Arbitrator shall have the authority to entertain a motion to
dismiss and/or a motion for summary judgment by any party and shall apply the standards governing
such motions under the Federal Rules of Civil Procedure. The Arbitrator shall apply the
substantive law (and the law of remedies, if applicable) of the state in which the claim arose, or
federal law, or both, as applicable to the claim(s) asserted. The Arbitrator shall have the
authority to award equitable relief, damages, costs and fees as provided by the law for the
particular claim(s) asserted. The arbitrator shall not have the power to award remedies or relief
that a California court could not have awarded. The Federal Rules of Evidence shall apply. The
burden of proof shall be allocated as provided by applicable law. The Arbitrator, and not any
federal, state, or local court or agency, shall have exclusive authority to resolve any dispute
relating to the interpretation, applicability, enforceability or formation of the Agreements,
including but not limited to any claim that all or any part of any of the Agreements is void or
voidable. The arbitration shall be final and binding upon the parties.

22.2.3.3      Costs. Either party, at its expense, may arrange for and pay the cost of a court reporter
to provide a stenographic record of the proceedings. If the Arbitrator orders a stenographic
record, the parties shall split the cost. Except as otherwise provided in this Paragraph and in
Paragraph 18, Optionee and the Company shall equally share the fees and costs of the arbitration
and the Arbitrator except that Optionee shall not be required to pay any costs that the Optionee
would not be obligated to pay if his claim as brought in court.

	22.3	 	Enforceability

Either party may bring an action in any court of competent jurisdiction to compel arbitration under
this Option Agreement and to enforce an arbitration award. Except as provided above, neither party
shall initiate or prosecute any lawsuit or administrative action in any way related to any
Arbitrable Claim. The Federal Arbitration Act shall govern the interpretation and enforcement of
this Paragraph.

	23.	 	Acceptance

	23.1	 	Optionee hereby acknowledges by signing the Notice:
	 
	 	 	I have received a copy this Option Agreement, the Notice, the Plan and Exercise Agreement; I
have had the opportunity to consult legal counsel in regard to the Stock Agreements, and
have availed myself of that opportunity to the extent I wish to do so (I understand the
Company’s attorneys represent the Company and not myself, and I have not relied on any
advice from the Company’s attorneys); I have read and understand this Agreement; I AM FULLY
AWARE OF LEGAL EFFECT OF THIS OPTION AGREEMENT, INCLUDING WITHOUT LIMITATION THE EFFECT OF
PARAGRAPH 21 HEREOF CONCERNING ARBITRATION; and I have entered into this Agreement freely
and voluntarily and based on my own judgment and not on any representations or promises
other than those contained in this Agreement.

23.2     Optionee accepts this Option subject to all the terms and conditions of the Plan and this
Option Agreement. Optionee acknowledges that there may be adverse tax consequences upon exercise
of this Option or disposition of the Shares and that Optionee should consult a tax adviser prior to
such exercise or disposition.

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Exercise Agreement

I hereby elect to purchase the number of shares of Common Stock of Alliance Semiconductor
Corporation, a Delaware corporation (the “Company”) as set forth below:

	 	 	 	 	 	 	 
	Optionee:

	 	 	 	Number of Shares Purchased:	 	 
	 

	 	 
	 	 	 	 

	 	 	 	 	 	 	 
	Social Security Number:

	 	 	 	Purchase Price Per Share:  $	 	 
	 

	 	 
	 	 	 	 

	 	 	 	 	 	 	 
	Address:

	 	 	 	Aggregate Purchase Price: $	 	 
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 

	 	 
	 	 
	 	 

Date of Optionee’s Stock Option Agreement: ____________________ (the “Option Agreement”)

	 	 	 	 	 
	Type of Option:
	 	 ̈Incentive Stock Option
	 	Exact Name of Title Desired for Shares:
	(check one)
	 	 ̈Nonqualified Stock Option
	 	 
	 
	 	 
	 	 

Optionee hereby delivers to the Company the Aggregate Purchase Price, to the extent permitted in
the Option Agreement, as follows (check as applicable and complete):

 ̈ in cash or by check in the amount of $                    ;

 ̈ where approved by the Committee, by delivery of fully-paid, nonassessable and vested shares
of the common stock of the Company owned by Optionee for at least six (6) months prior to the date
hereof (and which have been paid for within the meaning of SEC Rule 144), or obtained by Optionee
in the open public market, and owned free and clear of all liens, claims, encumbrances or security
interests, valued at the current Fair Market Value of $                     per share (provided, however,
that in the case of ISOs, such Committee approval must have been made at the time of grant);

 ̈ by cancellation of indebtedness of the Company to Optionee in the amount of $                    ;

 ̈ by the waiver hereby of compensation due or accrued to Optionee for services rendered in
the amount of $                    ; or

 ̈ through a “same-day-sale” commitment, delivered herewith, from Optionee and the NASD Dealer
named therein, in the amount of $                    .

Market Standoff Agreement. Optionee agrees in connection with any registration of the Company’s
securities that, upon the request of the Company or the underwriters managing any public offering
of the Company’s securities, Optionee will not sell or otherwise dispose of any Shares or any other
securities of the Company without the prior written consent of the Company or such underwriters, as
the case may be, for such period of time from the effective date of such registration as the
Company or the underwriters may specify for employee shareholders generally. Optionee understands
and agrees that, in order to ensure compliance with the market standoff agreement, the Company may
issue appropriate “stop-transfer” instructions to its transfer agent.

Tax Consequences. OPTIONEE UNDERSTANDS THAT OPTIONEE MAY SUFFER ADVERSE TAX CONSEQUENCES AS A
RESULT OF OPTIONEE’S PURCHASE OR DISPOSITION OF THE

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SHARES. OPTIONEE REPRESENTS THAT OPTIONEE HAS CONSULTED WITH ANY TAX CONSULTANT(S) OPTIONEE DEEMS
ADVISABLE IN CONNECTION WITH THE PURCHASE OR DISPOSITION OF THE SHARES AND THAT OPTIONEE IS NOT
RELYING ON THE COMPANY FOR ANY TAX ADVICE.

Entire Agreement. The Company’s 2002 Stock Option Plan (“Plan”) the Option Agreement and Notice of
Grant of Stock Options and Option Agreement (“Notice”) are incorporated herein by reference. This
Exercise Agreement, the Plan, the Option Agreement and the Notice constitute the entire agreement
of the parties with respect to the subject matter hereof and supersede in their entirety all prior
undertakings and agreements of the Company and Optionee, oral or written, with respect to the
subject matter hereof, and may not be modified except in a writing signed by the President of the
Company and Optionee.

	 	 	 	 	 	 	 
	Date:

	 	 	 	Signature of Optionee:	 	 
	 

	 	 
	 	 	 	 

-11-

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